with our current job, or negotiating to get a better deal in our current job, or getting or taking other offers, or changing careers, or taking some time away from work. There is always opportunity cost in choosing one path over others.
The betting elements of decisions—choice, probability, risk, etc.—are more obvious in some situations than others. Investments are clearly bets. A decision about a stock (buy, don’t buy, sell, hold, not to mention esoteric investment options) involves a choice about the best use of financial resources. Incomplete information and factors outside of our control make all our investment choices uncertain. We evaluate what we can, figure out what we think will maximize our investment money, and execute. Deciding not to invest or not to sell a stock, likewise, is a bet. These are the same decisions I make during a hand of poker: fold, check, call, bet, or raise.
We don’t think of our parenting choices as bets but they are. We want our children to be happy, productive adults when we send them out into the world. Whenever we make a parenting choice (about discipline, nutrition, school, parenting philosophy, where to live, etc.), we are betting that our choice will achieve the future we want for our children more than any other choice we might make given the constraints of the limited resources we have to allocate—our time, our money, our attention.
Job and relocation decisions are bets. Sales negotiations and contracts are bets. Buying a house is a bet. Ordering the chicken instead of the steak is a bet. Everything is a bet.
Most bets are bets against ourselves
One of the reasons we don’t naturally think of decisions as bets is because we get hung up on the zero-sum nature of the betting that occurs in the gambling world; betting against somebody else (or the casino), where the gains and losses are symmetrical. One person wins, the other loses, and the net between the two adds to zero. Betting includes, but is not limited to, those situations.
In most of our decisions, we are not betting against another person.
Rather, we are betting against all the future versions of ourselves that we
are not choosing. We are constantly deciding among alternative futures: one where we go to the movies, one where we go bowling, one where we stay home. Or futures where we take a job in Des Moines, stay at our current job, or take some time away from work. Whenever we make a choice, we are betting on a potential future. We are betting that the future version of us that results from the decisions we make will be better off. At stake in a decision is that the return to us (measured in money, time, happiness, health, or whatever we value in that circumstance) will be greater than what we are giving up by betting against the other alternative future versions of us.
Have you ever had a moment of regret after a decision where you felt, “I knew I should have made the other choice!”? That’s an alternative version of you saying, “See, I told you so!”
When Pete Carroll called for a pass on second down, he didn’t need an inner voice second-guessing him. He had the collective cry of the Seahawks fans yelling, “When you called for Wilson to pass, you bet on the wrong future!”
How can we be sure that we are choosing the alternative that is best for us? What if another alternative would bring us more happiness, satisfaction, or money? The answer, of course, is we can’t be sure. Things outside our control (luck) can influence the result. The futures we imagine are merely possible. They haven’t happened yet. We can only make our best guess, given what we know and don’t know, at what the future will look like. If we’ve never lived in Des Moines, how can we possibly be sure how we will like it? When we decide, we are betting whatever we value (happiness, success, satisfaction, money, time, reputation, etc.) on one of a set of possible and uncertain futures. That is where the risk is.
Poker players live in a world where that risk is made explicit. They can get comfortable with uncertainty because they put it up front in their decisions. Ignoring the risk and uncertainty in every decision might make us feel better in the short run, but the cost to the quality of our decision- making can be immense. If we can find ways to become more comfortable with uncertainty, we can see the world more accurately and be better for it.