346 AAssignmentsReading #6

Work_with_Human_Nature.pdf

Home >English homework help > 346 AAssignmentsReading #6

116

[6]

W O R K W I T H H U M A N N AT U R E

In 2017, the city of Cape Town, South Africa’s second most- important economic center, began to run out of water. Experiencing a drought of historic proportions, officials in the city of nearly four million people watched with trepidation as water levels in key reservoirs declined at alarming rates. Most worried was Patricia de Lille, a former laboratory technician and labor- union leader who served as Cape Town’s mayor. “ We are in a very serious crisis and we know there are still some customers who are acting as if our resources are not under strain,” she warned in February 2017.1 In October 2017, de Lille said that “[i] f consumption is not reduced to the required levels of 500 million liters (132 million gallons) of collective use per day, we are looking at about March 2018 when supply of municipal water would not be available.”2 The fateful date soon became more precise: March 13, 2018. The countdown began to what came to be known as Day Zero— the day when, for the first time in modern history, the taps of a major city would run dry.

To avert the crisis, de Lille and her team rolled out every tool available. The government raised water rates, imposed fines on de- linquent water users, tightened enforcement, and expanded leak de- tection and repair. It rushed to bring new infrastructure on line to increase water supply, including new desalination plants. The city

Building a Resilient Tomorrow: How to Prepare for the Coming Climate Disruption. Alice C. Hill and Leonardo Martinez-Diaz, Oxford University Press (2020). © Oxford University Press. DOI: 10.1093/oso/9780190909345.003.0007

W O R K W I T H H U M A N N AT U R E

117

imposed a water- use target of 50 liters (~30 gallons) per person per day— enough for drinking, cooking, hygiene, doing dishes and laundry, a ninety- second shower, and one toilet flush.

But as late as January 2018, only about half of the city’s residents were complying with water restrictions.3 So the mayor complemented the carrots and sticks already in place with tools drawn from behavioral science. In addition to all its other measures, her government experimented with “nudging,” that is, applying techniques designed to prod behavior in a predictable direction, but which by themselves do not forbid options or significantly change economic incentives. The government turned to a study commis- sioned some years before by the South Africa Water Research Commission that suggested significant additional water savings could occur if customers received notice of how their excessive water use compared to their neighbors’ water use.4 The govern- ment decided to harness the power of peer pressure— naming and shaming, as well as recognizing achievement— to change behavior.

Cape Town authorities applied this concept on a large scale. The city launched a web- based water map, which allowed anyone to see the water usage of individual properties across the entire city, based on the latest meter readings. Properties using less than 1,600 liters (6,000 gallons) showed up on the screen with a bright green dot; those consuming more than that were shown with a dark green dot. The goal was to turn the city bright green. The city also pub- licly identified the streets where the one hundred largest water users resided. Alongside this, Cape Town authorities distributed informa- tion and “tips” on how to reduce water consumption.

The concept of Day Zero itself proved key to the government’s nudging strategy. Day Zero made the threat real— particularly to the largest water users and wealthy owners of water- guzzling lawns and pools. The city launched a web- based “water dashboard,”

B U I L D I N G A R E S I L I E N T T O M O R R O W

118

showing weekly data on the water levels in reservoirs, the city’s col- lective water consumption, and how consumption compared to the government’s targets. The authorities also set up a Facebook page illustrating some of the measures that would be put in place should Day Zero arrive, including vivid descriptions of the hardships of water rationing, the locations of water distribution points, and busi- ness closures. The pain these measures would impose was not lost on well- heeled Cape Town residents, who started referring to this as “the crazy page.” “Day Zero,” one Cape Town resident and environ- mental advocate told us, “scared the shit out of middle- class white people.”

In the end, Day Zero did not arrive. High- income households cut water demand by 80 percent, and low- income families reduced it by 40 percent.5 Many of the demand- reduction measures, including the behavioral interventions, remain in place and are becoming the new normal. To be sure, not every intervention worked as expected, and some of the measures, such as the water map, remain deeply unpopular. It is not yet clear whether Cape Town avoided disaster or merely postponed it; that will depend on the city’s long- term planning. But the combined measures achieved massive cuts in de- mand in a short amount of time, and that has officials from water- stressed regions around the world, from California to São Paulo, trying to learn from Cape Town’s story.

Cape Town’s water crisis illustrates a larger phenomenon. Human beings are not psychologically well- equipped to prepare for the impacts of climate change. We are not good at dealing with dangers we have trouble picturing in our minds, and we often suc- cumb to excessive optimism. We are reluctant to pay short- term costs that are certain in exchange for future, uncertain benefits. Given the enormity of the climate resilience challenge, we are at risk of feeling overwhelmed and therefore paralyzed by the scope of the

W O R K W I T H H U M A N N AT U R E

119

problem. If we are going to build resilience to climate change suc- cessfully, we are going to have to work around some of these cog- nitive limitations. Human nature is difficult, if not impossible to change, so it is best to deploy a variety of approaches and “nudges” that work with human nature, not against it.

GRAPPLING WITH HUMAN BEHAVIOR

Never before have policymakers paid as much attention to the scien- tific study of human behavior as they do today. Over the past twenty years, psychologists, neuroscientists, and economists have joined forces to understand in more rigorous ways how humans make decisions. Behavioral science has rapidly captured the attention of decision- makers in politics and business. In 2002, American- Israeli psychologist Daniel Kahneman received the Nobel Prize in eco- nomics for his insights into human judgment and decision- making. His 2011 book, Thinking , Fast and Slow, has become a bestseller and is frequently found on the bedside tables of influential people.

In 2010, British Prime Minister David Cameron created the Behavioural Insights Team, nicknamed “the Nudge Unit” inside his office. He gave it two years to prove that behavioral science could improve public policy and deliver a tenfold return on its costs.6 The unit proved its worth by demonstrating how modest interventions could, for example, boost the rate at which taxpayers paid back taxes and the number of people who chose to insulate their attics, cutting energy waste. The unit has since reincorporated as a public- service company and today supports public- service organizations glob- ally. In 2015, President Obama created the Social and Behavioral Sciences Team at the White House and ordered all executive agencies to develop strategies for applying behavioral science to

B U I L D I N G A R E S I L I E N T T O M O R R O W

120

programs and recruit relevant experts.7 At least a dozen countries have integrated the insights of behavioral science into their opera- tions.8 So far, however, nudge units have not paid enough attention to helping communities cope with climate impacts. It’s time to put these insights to work for resilience.

Behavioral science suggests that certain biases regularly im- pede good decision- making. A long catalogue of these exists. Here, the focus is only on a few that are most relevant for climate resil- ience. A key one is availability bias, or the tendency to judge an event based on how easily we can call to mind a relevant example. This bias can lead us to underestimate the likelihood of events we have never seen before. In the context of a changing climate, this is obviously a problem, since we are constantly confronted with new extremes.

Consider the surprise expressed by politicians, news comm- entators, and homeowners at the never- before- seen trajectory of Hurricane Sandy, which drove it into New York and New Jersey from the Caribbean in 2012, or the record- breaking scale of California fires in recent years, or the fact that 2017 was the first time in re- corded history that three Category 4 hurricanes made landfall in the United States in a single year. Climate change will create conditions for which humans have no collective memory. To adapt to climate change, we are going to have to visualize possible futures, even those that seem quite unfamiliar.

Another stumbling block is optimism bias, or the tendency to overestimate the likelihood that we will experience good events and underestimate the likelihood that bad events will befall us. Many people believe they will be safe from extreme climate events not because they can’t imagine disasters happening, but because they

W O R K W I T H H U M A N N AT U R E

121

don’t imagine disasters will happen to them. This tendency shows up clearly in polling data.

In a 2018 public opinion survey, over 70 percent of respondents said that global warming will cause harm to plants, animals, and fu- ture generations.9 Sixty percent expect that harm will also come to people in the United States, and half said the harm will extend to their communities and even their own families. But only 42 percent think they will be personally harmed by climate change. Likewise, millions of people let optimism get the best of them when it comes to property insurance. Once memories of a disaster fade, the number of people buying coverage declines as customers let their fire or flood insurance policies lapse. Many can’t help but think that they will somehow escape through skill or luck, even when others are afflicted.

Another cognitive bias worth highlighting is loss aversion, which is the tendency to give greater weight to losses in com- parison to gains. Loss aversion comes from the perception that a loss hurts, say, twice as badly as a gain feels good, even when the loss and gain are objectively of the same size. This is a well- documented phenomenon in the investment world. An investor might insist on holding on to an investment that is losing value, even though the economically rational thing to do would be to cut losses and sell immediately. Yet the mental pain of real- izing the loss keeps the investor from dumping the asset, which only makes his or her financial situation worse. With regard to resilience, loss aversion bias can mean that communities avoid making investments today that carry short- term costs, even if those investments will protect them in the long run from bigger climate- related losses.

B U I L D I N G A R E S I L I E N T T O M O R R O W

122

INSTITUTIONALIZING IMAGINATION (COUNTERING AVAILABILITY BIAS)

After the attacks of September 11, 2001, the US government set up a commission to study the event and draw lessons on how to guard against similar tragedies. In its final report, the commis- sion famously identified “failure of imagination” as a factor in the government’s inability to foresee and prevent the massacres. It con- cluded that “at least some government agencies were concerned about the hijacking danger and had speculated about various sce- narios. The challenge was to flesh out and test those scenarios, then figure out a way to turn a scenario into constructive action.”10

How to address this failure to take preventive action? “Imagina- tion is not a gift usually associated with bureaucracies,” the com- mission concluded dryly. “It is therefore crucial to find a way of routinizing, even bureaucratizing, the exercise of imagination.”11 This sounds like a contradiction in terms. We think of imagination as something that belongs to the realm of unstructured, serendipi- tous thinking, not to the regimented world of bureaucracy.

Part of the answer lies in making the exercise of imagination a regular, even mandatory practice. This is what scenario planning is all about. It’s not about predicting the future, but about considering what different futures might look like regardless of how likely or unlikely they may seem. The goal is to expand the range of worlds and events decision- makers can visualize, especially when these are outside their direct experience. If these worlds become more men- tally “available” to leaders and the public, they will be able to grapple more effectively with these possible futures.

Scenario planning focused on climate impacts is already being put to use. In 2017, more than a dozen globally active banks, many

W O R K W I T H H U M A N N AT U R E

123

of them household names, got together to ask a single question. How might climate change affect customers and their capacity to repay loans in the years and decades to come?12 The banks modeled several scenarios involving average global- warming increases of 2°C (3.6°F) and 4°C (7°F) above preindustrial levels. What they found was sobering but also helpful.

The Canadian banking giant TD Bank looked at how cli- mate change might affect the electric utilities to which it lends money. It subjected a sample of its customers to simulations of a warmer climate and concluded that, under all scenarios, a ma- jority of the utilities would see their creditworthiness deteriorate because of climate change impacts. Another major bank, which decided to remain anonymous, analyzed a sample of its clients in the agriculture sector and found that almost all would see signifi- cant declines in revenue and credit downgrades in a 2°C warmer world. In a 4°C warmer world, the decline would double in se- verity. Interestingly, most of the financial damage in both banks’ simulations resulted from slow- onset impacts, such as water stress and rising average temperatures, not from sudden extreme events, such as hurricanes.

Scenario planning is not just for banks. The private- sector- led Task Force on Climate- Related Financial Disclosures (see chapter 3) has recommended that all companies undertake climate change scenario analysis and disclose the results. Another example is the Obama administration’s work with state and municipal leaders to use scenario planning to prepare for local climate threats. In Texas, the White House and the Federal Emergency Management Administration (FEMA) worked with Houston to imagine a hur- ricane hitting the city, eerily foreshadowing Harvey’s devastation several years later.

B U I L D I N G A R E S I L I E N T T O M O R R O W

124

In 2014, the White House and FEMA also teamed up with local leaders in Norfolk to analyze climate- impact projections, discuss their implications for the city, and propose short- term actions to begin addressing long- term risks. Participants in the exercise con- sidered risk in two time horizons— one referred to as “our children’s time,” which ran until 2044 and another called “our grandchildren’s time,” which ran until 2084. FEMA’s planning division deliberately framed the exercise in terms of time horizons that would feel per- sonal and real to participants; that’s why the planners referenced cycles of family life. The exercise produced a range of thoughtful recommendations, some of which have since been implemented, including revising the city’s building code to require resilient construction.

Another way of institutionalizing imagination is through design competitions. In 2013, the US government launched an initiative called Rebuild by Design. The program offered over a billion dollars to support innovative projects that leveraged climate resilience strategies to rebuild areas hit by Superstorm Sandy. Conceived as a competition, Rebuild by Design hoped to unlock the creativity needed to build for a different future. One of the first projects to be awarded funding was called “The Big U” (Figure 6). Its architects proposed constructing a belt of hardened, flood- protection infra- structure all around lower Manhattan, but this infrastructure would not look like a barrier separating the community from the water- front. Instead, the architects designed it to double as a structure for public recreation, sightseeing, environmental education, and even farming. “We put designers at the center of [the program] because design is a discipline that teaches you to imagine things that people haven’t seen,” recalled Shaun Donovan, Obama’s Housing and Urban Development Secretary.13

W O R K W I T H H U M A N N AT U R E

125

TAKING OFF THE ROSE- COLORED GLASSES (COUNTERING OPTIMISM BIAS)

At 10:11a.m. on August 28, 2005, as Hurricane Katrina was closing in on Louisiana, the local office of the National Weather Service (NWS) issued a public warning that screamed, in characteristic cap- ital letters:

devastating damage expected . . . all wood framed low rising apartment buildings will be destroyed . . . the majority of industrial buildings will become non functional . . . airborne debris will be widespread . . . per- sons . . . exposed to the winds will face certain death if

Figure 6 Rendering of the Big U in Manhattan, New York City. Source: © Rebuild by Design.

B U I L D I N G A R E S I L I E N T T O M O R R O W

126

struck . . . water shortages will make human suffering in- credible by modern standards.14

Subsequent analyses of evacuation during Katrina have suggested that this terrifying official statement convinced people to evacuate and saved lives.15 The message shook people out of their optimism bias and got them to take off their rose- colored glasses. In the com- plex world of emergency warnings, public officials must work hard to nudge people out of their optimism bias and get them to evac- uate. Sending a scary message is one way to do it, but experience shows that authorities should use this approach carefully. Getting people to respond appropriately in the face of danger is more diffi- cult than it seems.

Sometimes, scary messages can backfire. In one revealing exper- iment, conducted in Florida’s Miami- Dade County and published in 2016, researchers created a fictional storm (“Hurricane Julia”) and provided local residents with information about the storm.16 They tested different warning messages on different groups of residents to see how they would react. Not surprisingly, the group that re- ceived a “scary” message (if . . . you stay in the area, you may die) reported a higher desire to evacuate than those who received a less scary message: there will be storm surge of 4 feet or higher along coastal areas. But the “scary” message led many participants to regard the information as overblown and the official source as unreliable.

The experiment also showed warnings that cite probabilities can backfire, too. For example, when some residents received a probabi- listic warning (there is a 55 percent chance that the eye of the hurricane will make landfall in miami- dade county), they wrongly associated the 55 percent likelihood not only with hur- ricane landfall, but also storm surge and other impacts. More people

W O R K W I T H H U M A N N AT U R E

127

decided to play the odds and stay put, even when the probabilistic warning was accompanied by the scary message (you may die).

At the same time, the experiment found that when residents received an actionable warning (if you live in an area at risk from storm surge or flooding, evacuation is the most ef- fective way to protect yourself and your family), more people decided to evacuate, and fewer felt the information was over- blown or unreliable.

All this suggests that public officials face tricky dilemmas. Do they omit discussion of probabilities because people may misunder- stand them? Do they risk putting people in harm’s way if they don’t use scary messaging, even if it undermines their credibility in future emergencies? Behavioral science seems to be saying that optimism bias can be managed with the right messages. Scaring people can prove effective but must be done sparingly. Giving the public clear information about the risks and providing them with actionable recommendations can nudge desirable behavior. As we move into a world where extreme weather may become a permanent feature of life, resilience will mean finding the best ways to get people to pro- tect themselves instead of making foolhardy wagers with their lives and property. That will involve undertaking much more research into how people respond to different messages.

RETURN THE MONEY OR BUILD THE FLOODWALL? (COUNTERING LOSS AVERSION)

In the fall of 2012, Superstorm Sandy flooded 80 percent of the city of Hoboken, New Jersey. Best known as Frank Sinatra’s birthplace, the city was founded on an island surrounded by marshland, making

B U I L D I N G A R E S I L I E N T T O M O R R O W

128

it highly prone to flooding. During Sandy, flood waters swamped all the city’s electrical substations, casting its 53,000 residents into darkness and immersing streets in a dangerous mix of water, toxic chemicals, and raw sewage. After the waters receded and the city restored some semblance of normality, Hoboken Mayor Dawn Zimmer made it a top priority to protect her city from future storms.

Under Zimmer’s leadership, Hoboken applied for and received $230 million in funding from Rebuild by Design. Hoboken’s plan called for a floodwall and structures designed to delay flood waters, a retention system that would hold up to a million gallons of water, and a pump station to discharge the retained water. But before it could receive the money, the city would have to go through an ex- tensive process of public consultation and analysis to narrow down the design options. Here Zimmer’s floodwall and other design features ran into a different kind of wall— a wall of public opposi- tion, some of which reflected residents’ loss aversion bias.

Even though Sandy’s destruction had not yet faded from memory, many Hoboken residents staunchly opposed the de- sign options, fearing that their property values would take an im- mediate hit if the city built unsightly flood- protection structures close to their homes. The plan provided long- term benefits for the city and its residents by making them safer from flooding, but the minds of many residents focused only on their immediate losses due to devalued properties. Zimmer recalls an early meeting with residents: “I arrived at the meeting with two hundred infuriated people, who literally were screaming at me to give back the money.”17

No doubt helped by her background in crisis communica- tions, Zimmer committed herself to finding a way forward. That way forward involved highlighting the present and future benefits of the project for residents. Zimmer organized dozens of neighbor- hood meetings and community gatherings and visited concerned

W O R K W I T H H U M A N N AT U R E

129

residents. She pushed the engineers to come up with alterna- tive design options. They shifted the location of some structures and, echoing New York’s “Big U” proposal, added parks, benches, murals, and green walls so that the protective infrastructure would offer Hoboken’s residents amenities. The process enabled people to focus on the present and future benefits of the new infrastructure, rather than solely on their immediate losses. Zimmer secured public backing for the project, and Hoboken got the grant. The following year, the Metropolitan Waterfront Alliance recognized Zimmer as a “Hero of the Harbor” for her work in making Hoboken a national model for preparedness.

THE POWER OF WANTING TO FIT IN

The science of nudging leans heavily on the idea that the framing of choices can influence what people choose. One way to foster cer- tain types of resilient behavior is to capitalize on the fact that people want their peers to respect and admire them. Consider the findings of a large- scale experiment in Atlanta, Georgia, the results of which were published in 2011.18 Researchers divided about 100,000 water customers of the Cobb County Water System into three groups (with a fourth control group). One group received a two- sided sheet offering tips on how to reduce water usage and how to get more in- formation. A second group got the tip sheet plus a “soft social norm” message in the form of an official letter making the case for water conservation: “Reducing our water consumption today is impor- tant for preserving our environment and our economy for future generations.” The third group received a “strong social norm” mes- sage. This was a letter reporting a resident’s total water consumption and comparing it to his or her neighbors’ average consumption for

B U I L D I N G A R E S I L I E N T T O M O R R O W

130

the same period. It also contained a message saying, for example, “You consumed more water than 73 percent of your Cobb County neighbors.”

The experiment found that the strong social- norm message resulted in the largest water savings. If all households in the ex- periment had received the strong message, they would have saved the county an estimated 186 million gallons (700 million L) of water— the equivalent of cutting the water service to some 5,100 households. The highest water users proved to be the most respon- sive to the message. Indeed, high users reduced water consumption by almost 6 percent, while low users averaged only a 3 percent reduc- tion. Perhaps this difference simply reflects the fact that high- user households, with their pools and lawns, had more room to cut than low users, whose water needs were more basic. Disappointingly, though, the study also found that the effect of the measure wears off with time. Three months after the strong social norm letter led to big reductions in water use, about a third of the water savings disappeared as some users returned to their old ways.

Back in Cape Town, researchers also discovered the power of peer comparison. Around the time of Day Zero, a team of researchers tested a suite of nudging techniques to identify what worked best at inducing residents to save water.19 They found that of all the techniques, the most effective was advertising to customers that the city government would publicly recognize the biggest water savers. (Those who preferred not to be “outed” could opt out.) On average, using that approach alone resulted in water- usage reductions of al- most 2 percent, or nearly 132 gallons (500 L) per household per month. Harnessing the power of social recognition for climate ac- tion, and for resilience in particular, can be a useful nudging tool, though it must be combined with other policies to yield lasting results.

W O R K W I T H H U M A N N AT U R E

131

Behavioral science holds no silver bullet for meeting the chal- lenge of climate resilience, but the examples in this chapter show that the field offers useful and actionable insights. For that reason, countries that have established “nudge units” should focus signifi- cantly more attention on climate resilience. Those that have not set up such units should strongly consider doing so. The World Bank has assembled its own behavioral science team and has identified some tips for how to establish a nudge unit.20 These include enlisting a champion within the government, securing a two- to three- year commitment to give the unit time to show results, and focusing first on the low- hanging fruit— issues on which behavioral science theo- ries can be tested quickly, easily, and at little cost.

Establishing climate nudge units dedicated to emissions reduc- tion and climate resilience efforts could improve decision- making. The climate nudge units could focus on such challenges as institu- tionalizing imagination and road- testing messages that shape the public’s perception of climate risk. The units could also conduct large- scale experiments, share their results, and learn from one an- other. Leaders in business and at all levels of government should actively participate in the effort. The resulting nudges can provide communities with another tool that can be brought to bear on the challenge of building resilience.

PRESCRIPTIONS AND PROVOCATIONS

• Governments should apply behavioral science insights to rel- evant policies, programs, and operations, where such insights are likely to advance significantly climate resilience.

• Large companies should integrate regular climate- risk scenario analysis into key planning processes, including

B U I L D I N G A R E S I L I E N T T O M O R R O W

132

assessments of climate impacts on their supply chains and continuity of business operations.

• The federal government should support a research program to road test the effectiveness of different types of communi- cations and warnings regarding climate and weather- related threats.

• A climate nudge unit should be established at the federal level, with a clear mandate and resources to study, design, pilot, and evaluate behavioral science initiatives that promote climate resilience.