Man-with-a-hammer syndrome
> What gummed up Skinner’s reputation is that he developed a case of what I always call man-with-a-hammer syndrome: to the man with a hammer, every problem tends to look pretty much like a nail. The Psychology of Human Misjudgment is an brilliant talk given by Charlie Munger that I still return to and read every year to gain a fresh perspective. There’s a lot of wisdom to be distilled from that piece but the one thing I want to talk about today is the man-with-a-hammer syndrome. Man-with-a-hammer syndrome is pretty simple: you think of an idea and then, pretty soon, it becomes THE idea. You start seeing how THE idea can apply to anything and everything, it’s the universal explanation for how the universe works. Suddenly, everything you’ve ever thought of before must be reinterpreted through the lens of THE idea and you’re on an intellectual high. Utilitarianism is a good example of this. Once you independently discover Utilitarianism you start to believe that an entire moral framework can be constructed around a system of pleasures and pains and, what’s more, that this moral system is both objective and platonic. Suddenly, everything from the war in the middle east to taking your mid-morning dump at work because you need that 15 minutes of reflective time alone with yourself before you can face the onslaught of meaningless drivel that is part of corporate America but feeling guilty about it because you were raised to be a good Randian and you are not providing value from your employers so you’re committing and act of theft can be fit under the Utilitarian framework. And then, hopefully, a few days later, you’re over it and Utilitarianism is just another interesting concept and you’re slightly embarrassed about your behavior a few days prior. Unfortunately, some people never get over it and they become those annoying people write long screeds on the internet about their THE idea. The most important thing to realize about man-with-a-hammer syndrome is that there’s
Another failure of rationality is failing to understand the difference between investment goods and consumption goods. A $745,000 house may cost more to buy than a $710,000 house but you're also likely to be able to sell it for more as well. The "true" cost is not $35K, instead, it's a complex calculation of marginal mortgage payments, expected rise or fall of housing prices and cash flow considerations.