Cautionary Tales with Tim Harford - La La Land: Galileo’s Warning (Classic)

Episode Date: March 10, 2023

With the 95th Academy Awards just around the corner, Tim Harford looks back at a basic lesson. Galileo tried to teach us that adding more and more layers to a system intended to avert disaster often makes catastrophe all the more likely. This principle has been ignored in nuclear power plants, financial markets and at the Oscars... all resulting in chaos. For a full list of sources for this episode, go to timharford.com. Listener questions Tim is taking your questions. Do you have any queries about one of the stories we've covered? Are you curious about how we make the show?  Send in your questions, however big or small, and Tim will do his best to answer them in a special Q&A episode. You can email your question to [e-mail] or leave a voice note at 914-984-7650. That's a US number, so please be aware that if you're calling from outside the US international rates will apply.See omnystudio.com/listener for privacy information.

Do you want to know what it's like to hang out with MS-13 Nelsabrador? How the Russian Mafia fought battles all over Brooklyn in the 1990s? What about that time I got lost in the Burmese jungle hunt in the world's biggest MF lab? Why the Japanese Yakuza have all those crazy dragons at those? I'm Sean Williams. And I'm Danny Goldz. And we're the host of the Underworld podcast. We're journalists that have traveled all over, reporting on dangers people in places.

And every week we'll be bringing you a new story about organized crime from all over the world. We know this stuff because we've been there we've seen it and we've got the near misses and embarrassing tales to go with it. We'll mix in reporting with our own experiences in the field and we'll throw in some bad jokes while we're at it. The only world podcast explores the criminal underworld that affect all of our lives whether we we know it or not. Available wherever you get your podcasts. Pushkin The 95th Academy Awards are just around the corner.

And loyal cautionary tales listeners will know that the Academy Awards ceremony was not so long ago, the stage for one of the most bizarre, fascinating, and instructive errors in entertainment history. We explored that mistake in one of the very first episodes of cautionary tales, and it remains one of our best loved stories. If you want to know more about the ideas in this episode, check out our show notes and in particular, the wonderful book Meltdown by Chris Cleafield and András Tildrick. But first, another chance to hear La La Land, Galileo's warning.

You've heard this story before. You might even have watched it happening live. 33 million people did. There they stand, together on stage, fade on away and Warren Beatty, Bonnie and Clyde together again after 50 years. Even for a pair of veteran Hollywood stars, it must have been a nerve-wracking moment, yet their tasks seemed simple. Open a red envelope, take out a card, and read out the title of the film that had won the Academy Award for Best Picture. Bati opens the envelope, so far so good. Then he looks at the card in his hand. He hesitates.

Then he looks inside the envelope again, as though checking to see if there was a cover note. He looks over it done away, then raises both eyebrows. She reaches over and touches his arm affectionately. And the Academy Award. Bati begins. He pauses again. He looks at the Academy Award. Bati begins. He pauses again. He looks at the card again.

He slips his hand inside the envelope one more time. The audience laughs. But the moment of maximum tension that old rogue is playing with everyone's emotions. He continues. For best picture. He stops again. Fade underway, thinks he's goofing around too. You're impossible, she says, come on.

He shows her the card. She doesn't hesitate for a moment. The audience erupts in applause and the producers of La La Lounge take to the stage to give their acceptance speeches. Meanwhile, off in the wings, an accountant named Brian Cullenon knows that the biggest screw-up in the history of the Academy Awards is in full flow. The 2016 winner of Best Picture isn't La La Land. It's moonlight. So, yes, you've heard this story. Have you understood

what it really means? You're listening to another cautionary town. There's a simple way to tell the story of this fiasco, as Warren Beatty walked on stage. Brian Cullenen's job was to hand him the envelope for best picture. Instead, Cullenen handed over the envelope for best actress. A few moments earlier, that award had been won by Emma Stone for her performance in La La Land. And so when Beatty opened the envelope, he saw, Emma Stone, La La Land. Jimmy Kimmel, the host of the Oscars that evening, jokingly blamed it all on Bati. Warren, what did you do? I wanted to tell you what happened.

But it really wasn't Bati's fault. He didn't understand what he was looking at, and rather than say the wrong thing, he hesitated. Then he turned to fade out of the way. She was the person who actually uttered the title of the wrong film, but it wasn't her fault either. Imagine her situation. She's on stage in front of the most star-studded audience imaginable, plus tens of millions watching live on television. Bati seems to be messing around, and she doesn't know why. The first thing she sees on the card is La La Land and straight away that's what she says.

Some people blame Beatty, some people blame Dunnoway, most people blame Brian Cullinan, the accountant who handed over the wrong envelope. But all of those people, I think, are making a mistake. Almost a decade ago, years before this fiasco, I interviewed one of the world's most important thinkers on how accidents happen. He's a sociologist named Charles Perot, and he told me something that stuck in my mind, that we always blame the operator. It's always, he says, a case of pilot error.

Charles Perot is a wise old man. He's older than the Academy Awards themselves. He was four back in 1929 when they were first presented. And Perot is absolutely right. We inevitably look for someone to blame, and that inclination leads us astray. Our instinct is to blame the accountant Brian Cullenon. He did give Bati the wrong envelope. He was distracted. He tweeted a photograph of Emma Stone holding her Oscar statue at. At a time he

should have been focusing on giving Bati the right envelope he was on his phone, enjoying being close to one of the world's most beautiful people at her moment of triumph. We can all learn a lesson from that. Get off your phone, get off your phone when you're supposed to be having dinner with your family, get off your phone when you're supposed to be driving and get off your phone when you're supposed to be giving the envelope containing the best picture card to Warren Beatty. But the reason that it's a mistake to simply blame Colonnon is because Colonnon was just being human.

Humans are always getting distracted. Humans are always making mistakes. If our systems can't cope with those mistakes, then it's hopeless to demand better humans. We need better systems. When La La Land, fleetingly one moonlight oscar, some rich and successful people suffered some embarrassment and some heartache, but nobody died. Yet the lessen of the fiasco is far from trivial. The same kind of mistake in different situations can be catastrophic. Such mistakes can lead to nuclear accidents and financial meltdowns.

And when I say, can lead, I mean have lead, such disasters have already occurred. So let's try to understand what really happened that strange night at the Oscars, perhaps we can use that insight to prevent far more serious calamities. Do you want to know what it's like to hang out with MS-13, Nusabrador? How the Russian Mafia fought battles all over Brooklyn in the 1990s? Or what about that time I got lost in the Burmese jungle hunt in the world's biggest MF lab? But why the Japanese Yakuza have all those crazy dragons at those? I'm Sean Williams. And I'm Danny Goldz.

And we're the host of the Underworld podcast. We're journalists that have traveled all over, reporting on dangerous people in places. And every week we'll be bringing you a new story about organized crime from all over the world. We know this stuff because we've been there. We've seen it, and we've got the near misses and embarrassing tales to go with it. We'll mix in reporting with our own experiences in the field, and we'll throw in some bad jokes while we're at it. The only world podcast explores the criminal underworlds that affect all of our lives,

whether we know it or not, available wherever you get your podcasts. Let's talk about problem number one. Bad typography. I know it sounds strange, but it's true. The card that Bati took out of the envelope had nine words on it, and the largest word is oscars. Really? Is that really the most important piece of information? Are we worried that without it, Warren Beatty's going to think he's at the Iowa State Fair handing out a medallion for the best hog? The words La La Land and Emma Stone are printed with equal weight. Even though the winner is Emma Stone, the rest is detail.

Meanwhile, the important words best actress, a tucked away at the bottom of the card, and they're tiny. If best actress had been prominent, Warren Bates he wouldn't have been confused he would have known that he had the wrong card in his hand. And if Emma Stone had been in larger type than La La Land, Faye Dunnoay wouldn't have blurted out the name of the wrong film. It would have been awkward for Bating and Dunnoay to walk off stage to get the right envelope, but not nearly as awkward as not walking off stage to get the right envelope. So, the Academy should have hired a designer, but they're not the only ones. Imagine that you're the night shift supervisor at a nuclear power plant.

It's 4 o'clock in the morning, and you don't know it yet, but the turbine system that draws away the heat from the reactor core has just shut down. You're going to have to make some quick decisions, assuming you can figure out what's going wrong, and why. What's that? During the first few minutes of the accident, more than 100 alarms went off, and there was no system for suppressing the unimportant signals so that operators could concentrate on the significant alarms. Information was not presented in a clear and sufficiently understandable form.

That's from the overview of the official inquiry into what was then arguably the world's most serious nuclear accident at 3 Mile Island in 1979. It destroyed the reactor, came close to a serious release of radioactive material on the eastern seaboard, and shattered the reputation of the American nuclear industry. It's striking how quickly the inquiry focused in on the question of design. But to anyone who studies how accidents happen, it's not surprising at all. The plan's control rooms were so poorly designed that error was inevitable. Don Norman, the director of the design lab at UC San Diego, was asked to help analyze

the problems at Three Mile Island. Design was at fault, not the operators. The control panels were baffling. They displayed almost 750 lights, some next to the relevant switches, or above them, or below them, sometimes nowhere near the relevant switch at all. Red lights indicated open valves or active equipment. Green indicated closed valves or inactive equipment, but since some of the lights were typically red and others were normally green, the overall effect was dizzying. So yes, the operators made mistakes at 3 mile island, but with better design they might not have. Warren Beatty and Faye Dunno

Way would sympathise. But something else went wrong that night at the Oscars, something deeper and more surprising. It's a strange effect, and it was first observed by a man less famous for looking at why things go wrong and more famous for looking at the stars. Galileo Galilei is known for his astronomy, and because his work was consigned to the Church's index-liberorum-prohibitorum, the list of forbidden books. But the Great Man's final work opens with a less provocative topic, the correct method of storing a stone column on a building site. Bear with me. This book, from 1638, is going to explain the Oscar Fiasco and much more.

I must relate to circumstance which is worthy of your attention, as indeed are all events which happen contrary to expectation. Especially when a precautionary measure turns out to be a cause of disaster. A precautionary measure turns out to be a cause of disaster. That's a very interesting Galileo. Please go on. A large marabal column was laid out so that its two ends rested each upon a piece of beam. I can picture that in my mind, support the column while it's being stored horizontally,

ready for use. If you lay it on the ground, it may get stained, and you'll probably break it when you try to get ropes underneath it to pull it upright. So yes, store it flat, but propped up by a support at one end, and a support at the other. But what if the column can't support its own weight like that and simply snaps in half? Galileo has thought of that. A little later, it occurred to a mechanic that, in order to be doubly sure of its not breaking in the middle, it would be wise to lay a third support midway.

This seemed to all an excellent idea. Yes, if two supports are good, surely three supports are better. It was quite the opposite. For not many months passed, before the column was found cracked and broken, exactly above the new meter support. How did that happen? One of the end supports had, after a long while while become decayed and sunken, but the middle one remained hard and strong, thus causing one half of the column to project in the air without any support. The central support didn't make the column safer, it pressed into it like the central pivot

of a sea saw snapping it in half. Galileo's tail isn't really about storing columns, and neither is mine. It's about what I'm going to call Galileo's principle. The steps we take to make ourselves safe sometimes lead us into danger. The problem Galileo described is well known to safety engineers. There's an article in the Fine Scholarly Journal, Process Safety Progress titled, No Good Deed Goes Unpunished. Case Studies of Incidents and Potential Incidents caused by protective systems. These case studies are magnificent.

There's a chemical plant where two pressure relief systems interact in a way that means neither of them work. There's a flare designed to destroy pollutants, which ends up causing the release of toxic gases. There's an explosion suppression device that causes an explosion. This kind of thing happens more than you might think. An example is one of the earliest nuclear accidents at Fermi-1, an experimental reactor in Michigan. It's barely remembered now, except in Gil Scott Heron's song,

we almost lost Detroit this time. The operators at Firmy-1 lost control of the nuclear reaction, for reasons that were baffling to them. Some of the reactor fuel melted, it was all touch and go. Eventually, they got the reactor under control, shut it all down, and waited until it was safe to take it all apart. It was almost a year before the reactor under control, shut it all down and waited until it was safe to take it all apart. It was almost a year before the reactor had cooled enough to identify the culprit. A piece of metal, the size of a crushed beer can, had blocked the circulation of the coolant in the reactor core. It was a filter that had been installed at the last moment for safety reasons at the express request of the Nuclear Regulatory Commission. It had come loose and caused

the entire problem. Galileo's principle strikes again. Why do safety systems sometimes backfire? The wise old sociologist Charles Perot's most famous book is called Normal Accidents. It's about how certain kinds of system are vulnerable to catastrophic failure. So vulnerable, in fact, that we should view accidents in those systems as inevitable. The vulnerable systems have two features. The first is that they're what perot calls tightly coupled. In a tightly coupled system, one thing leads to another, and another, and another. It's like domino toppling, which is actually a great example of a tightly coupled system.

Once you start, it's hard to hit the pause button. A second feature is complexity. A complex system has elements that interact in unexpected ways. A rain forest is a complex system, so is Harvard University. But Harvard University usually isn't tightly coupled. If there's a problem, there's also time to find a solution. A system that's both complex and tightly coupled is dangerous.

The complexity means there will occasionally be surprises. The tight coupling means that there will be no time to deal with the surprises. Charles Perot's theory explains Galileo's principle. Every time you add a feature that's designed to prevent a problem, you're adding complexity. The middle support for the column added complexity. So did the safety filter that damaged the Fermi-1 reactor. Safety systems don't always make us safe.

Do you want to know what it's like to hang out with MS-13 Nusabrador? How the Russian Mafia fought battles all over Brooklyn in the 1990s? What about that time I got lost in the Burmese jungle hunt in the world's biggest Meflab? Or why the Japanese Yakuza have all those crazy dragons at to's? I'm Sean Williams. And I'm Danny Goldz, and we're the host of the Underworld podcast. We're journalists that have traveled all over, reporting on dangerous people in places.

And every week, we'll be bringing you a new story about organized crime from all over the world. We know this stuff because we've been there. We've seen it, and we've got the near misses and embarrassing tales to go with it. We'll mix in reporting with our own experiences in the field, and we'll throw in some bad jokes while we're at it. The Underworld podcast explores the criminal Under underworlds that affect all of our lives, whether we know it or not, available wherever you get your podcasts. Here's the question we should be asking about that bizarre evening at the Oscars.

How was it even possible for the distracted accountant, Brian Cullenon, to give Warren Bati the wrong envelope? A few minutes earlier, the envelope for best actress, the envelope containing the card that read Emma Stone La La Land, that envelope had been in the hands of Leonardo DiCaprio, as he stood on stage announcing her win. How could that envelope have made its way into the hands of Warren Beatty? The answer... it didn't. There were two envelopes. Every envelope for every category had a duplicate version waiting in the wings. These duplicate envelopes were there as a safety measure.

And that safety measure is what made the fiasco possible. Galileo's principle had bitten hard. Charles Perot's argument is that when systems are both complex and tightly coupled, we should expect catastrophic accidents. Does the Academy Award ceremony fit that description? It's certainly tightly coupled, you can't easily interrupt a live TV spectacular in front of millions of people to ask for advice. The show must go on.

Yet, the ceremony doesn't have to be complex. Giving an envelope to Warren Beatty doesn't have to be complex. But you can make it complex, if you try. Brian Cullenen's partner in crime that evening was Martha Ruiz. Like Cullenen, she was a senior accountant. The pair of them carried identical briefcases with an identical set of envelopes. On the day of the show, we'll get the ballots and Brian and I will go to the theater on two separate roads. He'll go one route and I'll go another route.

That's how Martha Ruiz helpedfully explain things to journalists just before Oscar night. Both she and Colonnoman have been proudly giving interviews about the foolproof system. We do that to ensure that in case anything happens to one, the other will be there on time and delivering what's needed with the full set. We do have security measures up until we're at the theater and delivering that envelope to

the presenter just seconds before they walk on stage. We'll be in two different locations, Brian will be on stage right and I'll be on stage left. It all sounds sensible and in many ways it is sensible. It's also complicated. The system of twin envelopes meant that every time an envelope was opened on stage, its duplicates in the wings had to be set aside. Martha Ruiz, stage left, handed the envelope for best actress to Leonardo DiCaprio, leaving Brian Cullinan, stage right, with a job of discarding the duplicate, the job he failed to do. If there hadn't been that set of twin envelopes, Warren Beatty could never have been given the wrong one. So, bad design helped cause the Oscar fiasco. It also helped cause the accident at 3 mile island.

And a complicated safety system was at the root of the Oscar Fast, it was also at the root of the Fermi-1 accident. But it's not just Oscars and Nuclear Power. I promised you a financial catastrophe too, and in this one, both safety systems and bad typography at a blame. They might even start to see the banking crisis in a very different light. In September 2008, at the height of the financial crisis, an insurance executive named Robert Willemstad requested a meeting with Tim Geithner. Geithner would later be the Treasury Secretary. At the time, he was the President of the New

York Federal Reserve. That meant he was responsible for supervising Wall Street's banks, including Lehman Brothers, which was on the brink of collapse. Robert Willemstad was the boss of an insurance company called AIG, and since AIG wasn't a bank, it was far from obvious why Willemstad was Geithner's problem. In his book Too Big To Fail, the journalist Andrew Ross Sorkin reports the intimate details of this ill-fated meeting. I'm really sorry, Mr. Willemstedt. Mr. Gattner's going to be a few minutes. No problem. I have time. I'm sorry, I know you've been waiting a long time. Mr. Gattner's on the phone to the boss

of Lehman Brothers. He's up to his eyeballs and Lehman. Tim Gattner was also exhausted. He'd been on an overnight flight from a banking conference in Switzerland. He must have felt completely overwhelmed. Who wouldn't have? Uh, Bob, is it? Sorry to keep you waiting, come in. Willemstadt got his moment. He badly needed to be able to borrow from the Fed, not normally something AIG would be allowed to do. But he also didn't want to panic Geitner. He needed to walk a tightrope to suggest that AIG could use some help, but wasn't actually

bankrupt. Is this a critical or emergency situation, Bob? Well, you know, let me just say that it would be very beneficial to AIG, Mr. Geigner. Perhaps I can leave this with you. Willemstadt handed Geigner a briefing note. Berid, deep within it, was a fast ticking time bomb. The largest firms on Wall Street were relying on AIG to pay out on insurance against financial trouble. The total sum insured was a truly ludicrous $2,700 billion.

AIG couldn't possibly pay if all the claims came in, and it was starting to look as though they might. But that meant that the big Wall Street banks wouldn't get the insurance payments they were relying on. AIG was both a bigger threat to the financial system than Lehman Brothers and a far more surprising one. If AIG was a safety net, it was one that wasn't going to break anyone's fall. But to realise that Tim Geithner would actually have to read and absorb the information in the note, and

he was busy. Really busy. So instead he filed it away and turned back to the Lehman Brothers problem. A.I.G. would melt down a few days later. The parallels with Oscar Knight are uncanny. For one thing, Geithner, who's no fool, had no idea how to interpret what he was looking at. It was unexpected and the key information was buried in the small print. Fade on away and Warren Beatty know the feeling.

Then there's Galileo's principle. Safety systems don't always make us safe. Those insurance contracts were supposed to offset risk, not create it, right? But by now we know that safety systems also introduce new ways for things to go wrong. The insurance contracts that were about to destroy AIG were called credit default swaps. They'd become popular as a way to offset risk with the blessing of regulators. They seemed a smart idea.

Just as the third support for the columns seems like a smart idea, and the metal filters at the Fermi reactor and the duplicate set of award envelopes. But they backfired. Wall Street banks were relying on these credit default swaps to keep them safe if there was trouble. When it became clear that insurance companies such as AIG couldn't possibly pay out, for banks all scramble to sell off their risky investments at the exact same time, for the exact same reason. A few days after Willemstadt had met Geintner, officials and bankers worked through the weekend

on the Lehman Brothers problem. Only on Sunday evening did one of those bankers receive a request from a Treasury official to ask if she could drop everything and work on rescuing AIG instead. The surprising phone call was greeted with a response that was unsurprisingly unsuitable for family ears. Hold on, hold on. You're calling me on a Sunday night saying that we just spent the entire weekend on layman and now we have this?

How the fuck did we spend the past 48 hours on the wrong thing? How indeed. For the same reason, they gave the Oscar to the wrong movie, confusing communication, and above all, a safety system that created a brand new way to fail. The banking crisis of 2008 shook the world financial system and destroyed millions of jobs. More than a decade later we're still living with the consequences. It was, in its way, a more serious crisis than any nuclear accident. It was certainly far greater than a bungalow at the Oscars, yet the same problems were

at the roots of all these accidents. After the La La Land Shambles, Vanity Fair reported, The Oscars have an intense, six-step plan to avoid another envelope disaster. The six steps include getting rid of the two accounting partners, Brian Colonyn and Martha Ruiz, and the twin sets of envelopes. Instead, says Vanity Fair, there will be three partners. A third partner will sit in the show's control room with the producers, all three partners will have a complete set of envelopes.

If having two sets cause the problem, having three sets is better, right? I'm not sure Galileo would agree. You've been listening to Corsionary Tales. I expand on some of the ideas in this episode in my book Adapt. You might like it. Corsionary Tales is written and presented by me, Tim Halford. Our producers are Ryan Dilly and Marilyn Rust. The sound designer and mixer was Pascal Weiss who also composed the amazing music. This season stars Alan Cumming, Archie Panjabi, Toby Stevens and Russell Tovey with Enso Chalente, Ed Gochen, Melanie Gutteridge, Mercyham and Ro, Rufus Wright, and introducing Malcolm Gladwell. Thanks to the team at Pushkin Industries, Julia Barton, Heather Fame, Mia LeBelle, Carly

Milleori, Jacob Weisberg, and of course, the mighty Malcolm Gladwell. And thanks to my colleagues at the financial times. you Business notifications getting out of hand, buried under an avalanche of customer emails, texts, and social media messages, keep your edge with Thrive Small Business Software and never miss a message again. Thrive offers one solution to communicate, market, and run your business, but simply, small businesses run better on Thrive. Get Command Center for free today at thrive.ca. That's THR-Y-V dot CA. Terms and conditions apply.

Free plans have limited functionality. Do you want to know what it's like to hang out with MS-13 Nusabrador? How the Russian Mafia fought battles all over Brooklyn in the 1990s? What about that time I got lost in the Burmese jungle hunt in the world's biggest meth lab? Why the Japanese Yakuza have all those crazy dragons at those? I'm Sean Williams. And I'm Danny Gold. And we're the host of the Underworld podcast.

We're journalists that have traveled all over, reporting on dangerous people in places. And every week we'll be bringing you a new story about organized crime from all over the world. We know this stuff because we've been there. We've seen it, and we've got the near misses and embarrassing tales to go with it. We'll mix in reporting with our own experiences in the field, and we'll throw in some bad jokes while we're at it. The Underworld podcast explores the criminal Underworld that affect all of our lives, whether we know it or not.

Available wherever you get your podcasts.