JOURNAL: Searching for Assumption Errors

One of the best ways to determine the viability of any future scenario is to examine its assumptions (aka its initial conditions). For example, there's an interesting 2001 report from Shell on energy futures called, "Energy Needs, Choices and Possibilities: Scenarios to 2050." This report paints a rosy picture of a technological fix (through an energy substitution process, which is commonly conveyed via intellectual fast food like the Whale oil story) to future energy needs. However, if you dig into the assumptions you find this:

“Personal Choices – related to values, the environment and lifestyles – influence the energy system. Affordability is not the key constraint in OECD countries.” (page 24)

and this:

"... scarcity of oil supplies -- including unconventional and natural gas liquids -- is unlikely before 2025... Technology improvements are likely to outpace rising depletion costs for at least the next decade, keeping new supplies below $20 per barrel. The costs of biofuels and gas to liquids should both fall well below $20 per barrel of oil equivalent over the next two decades, constraining oil prices." (page 18)

Of course, seven years of hindsight makes it easy to see these assumptions are false. It is much harder to find assumption errors that have yet to play out.

Comments

[SWIMMER21]

Your post is a half a surprise to me. Half because Shell has a reputation of being quite good at scenario making. Half also because it's always a challenge to foresee future. To be noticed : Shell is part of Society for Organizational Learning (http://www.solonline.org/)

[Globalscout]

Shell isn't the bad guy per say, but just like the rest us, their vision of the future is educated speculation at best. Corporate speak always attempts to emphasize the positive for obvious reasons, but the downside is too many people (those who prefer to view the world through rosy glasses) blindly accepts this type of speculation as fact, so problems are dismissed and not dealt with until they are a crisis. You're absolutely right about it being difficult to realize what assumptions are wrong until after the fact. I still think we'll see more state versus state wars, due to the shortage of key commodities, so one of us will be wrong, but we won't know for several years.

[dryki]

It's not hard to realize what assumptions are wrong until after the fact; that is relatively easy. What is hard to understand is what is right. Relatively - keep that in mind.

For example the Shell document. No need to get to page 20 something. The first page of text - the Foreward - is total hogwash. Paragraph 1:

The ways in which we provide and use the energy the world depends on are bound to change greatly over the next 50 years, in response to three fundamental challenges:
· giving all people access to the benefits of efficient, commercial energy from which nearly a fifth of us are still excluded,
· meeting the expanding and shifting energy needs of an urbanising world as economic development raises the living standards of billions of people, and
· preventing the pollution which damages health, blights environments and threatens vital natural systems.

Yeah, that would be a Great Change. What are they smoking and where can I get some?

[enigma_foundry]

I have some posts on exactly this issue; most of the errors in assumptions involve inflection points in processes or faulty analogies. Here are excerpts from two with links:

Looking through the overstock of my Grandfather’s bookstore, I have quite a number of Architectural Magazines, including many editions of “The American Architect,” “The Architectural Forum” (which actually covered Architecture, unlike today’s Architectural Forum, which almost no Architects read) and “The International Studio.” They cover the period from from the early teens to the late Thirties, but most fall between 1928 and 1934.
From the December 1930 edition of “The American Architect” there is an interesting article about Seadromes. Of course, no one today knows what a Seadrome is because they were never built, so this article is just about the only source I am aware of. There isn’t even an entry on Wikipedia. (Although there is a paragraph about them in the entry for Edward Robert Armstrong, the Engineer who had conceptualized and advocated the Seadrome concept.)

http://enigmafoundry.wordpress.com/2007/01/01/journey-to-the-end-of-the-night-seadrome-edition/

For example, the industry of the future seems to be a linear extrapolation of trends in the 1930’s. The airplanes of the 1970’s are huge propeller driven monstrosities, with about 10 engines on each wing. There is no thought that perhaps something different would come along. The development of industry seems to proceed with ever large steam driven locomotives of some kind powering a new industrial revolution, that looks much like the first, only its less sooty and much cleaner. What we have here is an extrapolation of the then-current trends, with out any changes or non-linear developments in technology.
And those inflection points are exactly the kinds of things that are very difficult to see, and are often the result of interaction of different fields of knowledge in unexpected ways. For example, the enormous increase in destructive capacity in state controlled armaments, i.e., the nuclear bomb, did not bring lasting warfare without end, but lasting peace, or least restraint from all-out war, between enemies.

http://enigmafoundry.wordpress.com/2006/11/30/journey-to-the-end-of-the-night-hg-wells-edition/

The whole category relating to what I call predictive frameworks is here:

http://enigmafoundry.wordpress.com/category/predictive-frameworks/

[Duncan Kinder]

One of the assumptions that recently has been floated is that private military corporations could serve as some sort of counter to guerrilla insurgencies.

The recent Lebanon uprising apparently rebuts this, according to the Los Angeles Times:

"For a year, the main Lebanese political faction backed by the United States built a Sunni Muslim militia here under the guise of private security companies, Lebanese security experts and officials said.

The fighters, aligned with Saad Hariri's Future movement, were trained and armed to counter the heavily armed Shiite Muslim militant group Hezbollah and protect their turf in a potential military confrontation.

But in a single night late last week, the curious experiment in private-sector warfare crumbled."

http://www.latimes.com/news/nationworld/world/la-fg-security12-2008may12,0,6458359.story

Of course, a highly motivated organization with social legitimacy, such as Hezbollah, is not necessarily the same as a drug cartel, so PMCs arguably might have some use in other contexts.

But the early results are in, and they must be accounted for.