Intro. [Recording date: July 17, 2025.]
Russ Roberts: Today is July 17th, 2025.
Before introducing today’s guest, I want to mention that we will be doing an EconTalk Book Club in two weeks, an episode on Ernest Hemingway’s novel of the Spanish Civil War, For Whom the Bell Tolls. I encourage you to read the book. Before that episode airs, I’ll be talking with Hemingway scholar, David Wyatt, about the book, fascism versus communism, Hemingway’s passion for grace under pressure, his literary reputation, and many other things. So, if you’d like to read the book in advance, please do so. It’ll air, again, in about two weeks.
Now on to today’s guest: author, consultant, and former submarine commander, David Marquet. His latest book, co-authored with Michael Gillespie, is Distancing: How Great Leaders Refrain to Make Better Decisions.
David, welcome to EconTalk.
David Marquet: Thanks so much for having me on the show, Russ.
Russ Roberts: Now, near the beginning of the book, you tell an incredible story, which I will never forget. I think it’s both fascinating and useful. You tell the story of Andy Grove and Gordon Moore in the early days of Intel. Gordon Moore was the founder of the company. Andy Grove was his first hire. At one point, they faced a crucial decision, and how did what you call distancing help them?
David Marquet: Yeah, so we all know Intel. We all know that they make microprocessors, but that’s not how they started. They started with memory chips. And so, Grove and Moore in the 1960s started building this company, and they did extremely well, as we know, and they grew the company up. And then, by the time the 1980s came along, memory chips were being commoditized, and there were competitive squeezes from mainly the Asian manufacturers who were doing better on both price and, frankly, quality.
At the same time, they had this little tiny product called the 4004 Microprocessor. And so, now we’re in the early 1980s, and they can’t make enough of these things. But it’s a minute part of the company, and it wasn’t what the company was started with.
And so, Grove and Moore are going back and forth for a year about what they should do with the company. And, any external observer would look and say, ‘Well, that’s obvious. You need to throw it all in on the microprocessor.’ But, that’s not what they did. They kind of debated, and they debated, and debated about it. And, Grove talks about it in his book, and he says, ‘We were memory chips. Our identity was linked to memory chips. Intel was memory chips.’ And so, they were at this impasse.
One day, a year into this stasis, they’re in a meeting, just the two of them. And, Grove describes, he’s looking out the window. So, there’s sort of this distance perspective. He talks about seeing flags off in the distance. And, he looks at Moore, and he says, ‘If we got fired and we got replaced, and the board brought in new people to run the company, what would those new people do?’ And immediately Moore says, ‘They would shift over to microprocessors.’
And, the thing that’s really amazing about this–well, of course the punch line is that’s what they did. And then, Intel–yeah, Intel Inside–Intel became even more famous with the microprocessor. But, what’s really interesting is the decision was not impaired through a lack of market research, through data, through consultants, or anything like that. It was simply impaired because of the way they thought about the problem, and the fact that they identified with this whole accumulation of all these previous decisions that resulted in them being rich and famous, and the company being successful, that had to do with memory chips. And, this, we find, is the biggest problem with decision-making. It’s not all these other things that we think it is.
Russ Roberts: I mean, it’s a fantastic story, I think, for two reasons. The first is just the phenomenon, the challenge of, as you write about extensively, stepping outside yourself. Forgetting–which seems like a bad idea, but it’s a good idea in some situations–forgetting the fact that you’ve built this company in a particular way with a particular product, which is actually locking you in. It’s actually this wonderful sense of success that you’ve had, all the thrills, all the identity, as you talk about: it’s actually a trap. It’s a terrible, terrible trap. So, that’s the first thing I love.
The second thing I love is this thought experiment, which is mind-blowing. Like what would they do? And, then, well, why don’t we just–‘I think you’re right. Why don’t we just go outside and come back in and do that?’ What they were going to do.
Russ Roberts: ‘Pretend we’re them.’
‘Oh, okay. What a good idea.’
David Marquet: Right. And it’s so freeing.
And we know, of course these examples will be well known to your listeners as well, but we know the stories of Kodak, and Blockbuster, and other companies that are stuck way too long with their product. And, again, it’s not because they’re not reading the market research. It’s just because, mentally, their brains are processing it in a way which tricks you. We live in a curated reality, but we think we live in a pure reality. We think that what we see, feel, sense, and interpret is the truth, but it’s not.
And, we all know from reading about human biases and Kahneman’s work that that’s the case, but we sort of have this calculus that says, ‘Well, that happens to other people. Oh, I can see that in other people.’ But, you never see it in yourself because that’s the trick of the brain. Because it says, ‘Oh no, this is the truth. Don’t pay attention to that. Here’s why.’ And, it will feel so genuine.
And it’s that stepping out of yourself and imagining you are somebody else, even for a moment. We don’t advise living your life in this sort of out-of-body mode, but there are key times when it’s super, super powerful.
Russ Roberts: Yeah. I think as powerful as it is in a corporate or business setting, I think in a personal setting it’s even more powerful. Because, we talked about the identity that Intel had as a memory chip company. But, we as individuals have identities as followers of certain ideologies, having a certain career path, a label after our name that describes our occupation. And, changing that and pivoting–which is the polite way of saying doing something radically different–it sounds so innocent, by the way: ‘I’m just going to pivot. I’m going to turn a little bit.’ But, it actually requires an enormous leap of faith. It’s extremely hard.
And, I think of it–what your book does–the way I think of it is: you go get outside counsel. You ask someone for advice. You say, ‘If you were me, what would you do?’ And, often that answer is,, like, ‘Oh yeah, that does make a lot of sense.’ And, in your case, you’re saying: You actually don’t need outside counsel. You might, but you can also treat yourself as the outside counsel. Step away and look at your situation with what Adam Smith called the impartial spectator–someone who doesn’t have all that baggage, and the self-confirmation bias, and all the other problems that come with decision-making on our own.
David Marquet: Yeah, exactly. You have a built-in outside observer because humans have the ability to imagine ourselves as somebody else. It’s a superpower. But, most of us don’t take full advantage of it, or don’t take near enough advantage of it.
We can imagine ourselves–there’s three dimensions we talk about. You can imagine yourself as someone else, like Gordon and Moore did. You can imagine yourself as somewhere else.
And so, psychologists do studies where they say, ‘Okay, tell the story as if you were a fly on the wall, watching you as an actor in the story.’ And, there’s so many benefits of this when people retell, for example, traumatic things that have happened to them in the past.
First of all, there’s sort of a natural tendency in depositions where, when people get to the real traumatic part of the story, they often will shift to third person. They’ll say, ‘So, I was jogging in the woods. And then, there she was, laying there.’ And, they’ll shift to the second or third person. That’s your brain protecting you. And, be someone else, somewhere else, or sometime else.
And, that sometime else is typically your future self. And so, all these are really interesting and useful.
I like to imagine just being my coach. My experience of my life is, I sort of view myself as the quarterback, and I’m on the field, and I get sacked, and the guy across on the other line says something bad about my sister, and it hits me personally. And, when I get knocked on the ground, I feel the bruises; and the coach is sitting there over on the sidelines, like, ‘Oh wow, that’s going to hurt.’ And, the word is ‘immersed.’ You’re, like, in it. The sweat–and, you see the sweat on the other player, and you’re in it. You’re immersed. You get cut off in traffic–‘Oh, they did that to me.’ And then, you have this immediate, ‘Ugh.’ But, an hour from now, hopefully you can’t even remember it, because it’s not important.
And so, it’s that idea that we jump out. I like to say, ‘Okay, imagine I’m my coach. Now, my coach is going to tell me what to do.’ And, it helps both ways. One, it helps with what you should do, and then it helps with actually following through on your things. Because now you’re doing something. It could be something easy like, I’m not going to eat desserts. Or it could be something–
Russ Roberts: It’s not easy, David. Don’t use that example. It’s a bad example. Pick a different example–
David Marquet: like, I’m going to retire. Or a move: ‘I’m going to stop traveling and move to France.’ Whatever it is, the coach can see it more clearly. So, when you then re-immerse yourself in yourself, you’re not doing what you want to do. You want to do what your coach wants to do. We all know the experience of having an accountability partner in business, or in workouts, or whenever it is. And so, now I want to keep coach happy.
And so, that also plays a trick on your brain, where you say, ‘Hey, my coach says I got to get out and walk for an hour a day, and I should get out and walk for an hour a day.’ And, you want to do it because you’re making the coach happy. So, in all these ways, we think it’s a super, super powerful mental manipulation.
Russ Roberts: Well, a coach is a great example because a lot of times we don’t notice our own failings. We’re oblivious to them. And, we don’t want a real coach: ‘Oh boy. Somebody’s going to tell us what we’re doing wrong all the time? I don’t need that.’ But of course, we do, often. And, the idea of doing it without the humiliation of that third person, that second person, but it’s you. It’s a great trick. It’s really a clever trick.
And, you give the example–it’s moving–of Itzhak Perlman, one of the greatest violinists of all time. And, you ask why he didn’t have a coach. A lot of great performers don’t have coaches. Some do, for parts of their game, obviously. But, he talked about his wife. What did he say about his wife?
David Marquet: Yeah, basically she played the role of the honest–she was the one who stepped on the outside. She was the independent observer, and she was able to give him honest feedback. And, here’s the key: he listened to her.
Russ Roberts: Yeah. But, when I read that part of the book, I thought about the idea–which I love–when I’m writing, of the reader over your shoulder. For most of my life, that was my father. And, sometimes it was my wife. My father’s passed away, so now it’s my wife more than others. And, when you have a co-author, sometimes it’s your co-author. But, the idea that it’s not just, ‘Oh, I’ll get advice from them,’ it’s while you’re in the moment, you are in the embodiment of the stepped-away, slightly distanced–or maybe greatly distanced–observer, helping you perform in a way you can’t when you’re afraid, when you’re tense, when there’s pressure. Or when you’re prone to just going off on a crazy side mission that’s a mistake. Your coach–whether it’s your spouse, or parent, or yourself imagining yourself as a mentor–can make a huge difference.
David Marquet: Yeah. So, the idea is: you become the other person. It’s not like you consider the perspective of the other person. I want you to go deeper than that.
So, there’s another story we tell in the book, which was where Jeff Bezos was talking about starting Amazon–
Russ Roberts: That’s a crazy–
David Marquet: And, he uses the vector of be some time else. So, the story is–
Russ Roberts: Say that again. He used the vector of what?
David Marquet: Be some time else. He became his future self. So, the three dimensions are: be someone else, be somewhere else, be some time else.
So, you could be someone else like, ‘Moore, Grove, I’ll be the coach, I’ll be my replacement, I’ll be my kids, I’ll be the board.’ Then somewhere else is, ‘I’ll view myself from the balcony.’ So, don’t be on the stage giving a speech. Be in the balcony, dispassionately looking, and say, ‘What do I think?’ Not the Instagram self-absorbed perspective, but just disparagingly[?].
And then, the third dimension is be some time else. So, what you do is you fast-forward yourself into the future, and then you inhabit that yourself–your future self. And, then, from that vantage point, you coach your current self.
And, I did this on the submarine. I used six months–was my typical window. And, I actually had a physical calendar that showed six months in the future. And, I would say, ‘What would the six-months-from-now David want today’s David to do in this situation?’
And, it’s so good because today you’re just like, you have all these competing factors, and you just kind of want to get through the day, and you’re sort of tempted to either overreact in certain situations or not really fix the problem, but just sort of solve it yourself. That’s the classic: I’ll just tell them what to do, and then we’ll be moving forward, rather than really teaching the team how to think about and solve their own problems. And then, you talk to your six-months-in-the-future self-and it says, ‘Well, if you keep doing that, you’re just going to keep doing that. So, how about you solve it once and for all, and invest some time and energy now? It’ll be more work today, but in the long run you’ll be way better off.’ And then, I would say, ‘Okay, that’s what I’m going to do.’ And, that was really, really helpful.
And, this is what Bezos did when he had to decide to start Amazon because he left a sure thing. He had a great job on Wall Street. He would have still made a lot of money–not as much, I don’t think, as he is making with Amazon. But, the thing that happens is, when you leap–he leaped out to 80 years. He said, ‘When I’m 80, what am I going to regret more? Starting and failing, or not having tried it?’ And, when you’re on the far side of the decision, looking back, that fear that you talked about gets reframed in your brain as regret. ‘Oh, I wish I had done this.’ And, therefore, you’re now more biased towards taking some of these bold leaps, which in today’s society may feel scary, but they’re really not dangerous.
Russ Roberts: Yeah. I like it because it’s a way to offset the other human tendency of: the future’s so far away, I’m not even going to think about it. This is to bring it into the moment.
The thing about Bezos that I loved, though, is, as you write, he went and got outside counsel. He went and asked somebody for advice. I think his boss on Wall Street–or who was it?
David Marquet: Yeah. He asked his boss. He says, ‘Hey, I got this idea to sell books on the Internet.’ So, this is back in 1994. And, his boss says, ‘Well, I think that’s a great idea for someone who doesn’t already have a good job.’ But then, his boss counseled him and said, ‘Hey, why don’t you go take the weekend and think about it?’ And so, over the weekend–well, he was basically by himself thinking about it–this is how he frames his way of thinking about it: He thought about himself as an 80-year-old thinking back to the situation in the day.
And, he talks about it. He says, ‘I was going to get a big bonus. I had to pay rent.’ And, when you’re way out there–the way we describe it in the book is: you today are your practical self. You have all these conflicting things going on in your life that you got to try and balance. So, you’re making compromises. When you strip all that away and just go way out, you say, ‘When I’m 80, what do I really wish I’d done?’ You become your ideal self. You look at it from the perspective of: what are my real values? And, it’s easier then to say, ‘You know what? Yeah, I might have trouble with my rent. I might have to go to a smaller place or whatever,’ but at the end of your life, you’ll have fewer regrets, and you’ll be happier to live a bigger, fuller life because of that.
Russ Roberts: Yeah. The part also I love, though, is the boss’s calculus, which is not ridiculous. You’ve got a good job. Why would you–not just a good job, by the way–that’s being polite. You got a great job. He’s making an enormous amount of money, and he’s saying, ‘Why would you throw that away for something that is, first of all, uncertain, and might turn out very, very badly?’ And, of course, there are many, many answers to that. But, the part that Bezos was focused on was, ‘Yeah, but what if it comes out really, really well?’
And so much of human frailty, as our evolutionary inheritance, is fear.
And a lot of your book is about overcoming fear, right? Your natural impulse is: I’m in a hammock. I am comfortable. Why would you roll out of the hammock, which is high above the ground, and run around the savanna and risk getting eaten? And, that’s what the boss said. And, it’s good advice on a certain level.
But, Bezos had the courage to say, ‘I will regret this,’ which of course he didn’t know he would regret it. The internet might’ve turned out to be a flash in the pan. Amazon could have failed–which it came close to doing many times–and then he might’ve said, ‘Why didn’t I listen to my boss?’
And, it turned out well for him. It might not have. And, for many others, it didn’t turn out well, by the way, who made the same calculation. But, they didn’t have that regret. But, I think the idea of knowing that you have, as a human being, this natural tendency towards security and a fear of failure that you might want to push back against. And this is a tool to help you do that.
David Marquet: Yeah. So, my co-author is the brains behind the outfit[?]; and he’s the Ph.D.-in-psychology guy. So, he was mustering up all this research that we read through. By ‘we,’ I mean sort of me and mostly him. But, there’s a lot of really interesting research about how we process emotional pain.
And, it turns out that if you go back on an evolutionary level, as we were developing as a species, we had wiring for physical pain. Most basic animals have wiring for physical pain. I smash my finger, I feel it. It’s wired through certain conductors into my brain. It’s processed as pain, on and on and on.
When we became mammals and we started to become social animals, our organism needed to process social pain–things like ostracism, or ‘Oh, I said the wrong thing,’ or ‘I’m worried they don’t like me’–because these are very important in the social context. And, our bodies just sort of borrowed or scaffolded onto this physical pain system to process our social pain. So, our social pain is processed on the physical pain system, which means it feels like physical pain. So, social pain can be mitigated by taking an aspirin, for example.
Russ Roberts: Physical pain. Physical pain.
David Marquet: Physical, yep. And social pain. Social pain can be mitigated by taking an aspirin because it’s using the same system that the physical pain system is using, which is really, really interesting.
So, these social pain things–so now in today’s modern society, most of the stuff you can do is safe. You’re going to live a long time, you’re going to have plenty to eat, you’re going to be fine. You can quit, you can keep doing something, you can move to another country. You can do a lot more than our brains want to make us think we can. Because why would you mess it up? Why would you mess up a good thing? You’re lying in your hammock, you’re still alive, and that’s number one. So, therefore, anything you do can either continue being alive–which is really basically where you are–or you can be dead, which is a risk. And, that’s how your brain processes it.
Russ Roberts: So, I love the story you tell–it’s obviously a different kind of fear story–which is: you get on an airplane, and you find yourself surrounded by NFL–National Football League–referees.
Now, listeners out there who are American football fans have a certain image of umpires, referees– every sport, whatever sport you like and watch. We just finished Wimbledon–the people who make the calls in or out–and we have an image. And, this story, one of the reasons I like the story is it really shakes up that image. And, you say that before the door even closed, this group of referees had taken out iPads and were watching the game they had just called, and they were critiquing themselves.
And then, you later saw them at the Super Bowl as the referees, because obviously they were one of the best teams of referees in the country–because they paid attention.
A couple of things I like about this, right? First of all, it’s very hard to watch yourself perform. Many people just don’t ever want to do it. Of course, it’s a fantastic way to get better–to film yourself. And, these guys were stuck being filmed, whether they liked it or not. So they thought, maybe we ought to watch and see what we did wrong, and maybe try to improve on it. And, I love that. That’s really true distancing, right? They’re literally watching themselves from outside the game and realizing what they did right and wrong, and getting better.
David Marquet: Yeah. It’s so important. And again, it ties up with your identity.
So, the thing that’s really interesting is, these guys were one of the top ref teams in the NFL–probably the top one, because they were the ones selected to ref the Super Bowl that year. So, they have the self-image, ‘Hey, I’m a good referee,’ but they’re still watching themselves.
So, I took up open-water swimming a few years ago. When I took up open-water swimming–I mean, I had swum, but I never really got any coaching. So there’s really no expectation that I was going to be a good swimmer and that I was going to have any kind of correct form. And, I was super-eager to get coaching. And, my wife would videotape. I had a coach in Australia, Bretton Ford who was an amazing guy. And I would send my tapes in to him, and he would say, ‘Okay, this is what’s happening. Your hand’s coming across, so do this drill.’ It was great. I was seeking that feedback. It didn’t feel threatening or anything.
And then, I started to compare that to my experience as a speaker. Which, after I was a submarine commander, and I wrote a book–first it was–and it started selling; and then I started getting invited to do talks. But, again, there’s no expectation that I was going to be any kind of a good speaker. And, so, at the beginning, I was, like, ‘Hey, how was that? What could I spend more time on?’ I was, again, with that curious, eager, seeking feedback mode.
And now, 10 years into it, a thousand speeches later, someone comes up to me and says, ‘Hey, can I give you some feedback?’ I mean, my brain goes to a dark place. I’m, like, ‘You know? No.’ I’ll say yes; I’ll pretend to be interested. But really, my brain–I’m, like–my brain makes up all these bad–and says, ‘Well, how many speeches have you given?’ And, blah, blah, blah. ‘How much do you get paid to speak, Bob?’
Because, my brain is still–I haven’t trained it fully to be eager and seeking that feedback. Well, it happened for a while, but then, when my identity kind of started to merge too closely–
So, I changed my bio a while back. This was partly under the advice of Simon Sinek at the time. Because my bio used to say, ‘David Marquet, bestselling author, expert in leadership.’ I didn’t write it, but it said ‘expert in leadership.’ He says, ‘You should change that to student.’ I was, like, ‘Yes.’
Russ Roberts: What a great idea.
David Marquet: So, now it says ‘Student of leadership.’ Which I really, really, really, really like. Way better. But, every once in a while someone just misreads it or something. They’ll say, ‘Expert in leadership.’ I’m, like, ‘Noooo.’
Russ Roberts: So, there’s a line in your book about leadership that I really love, that really encapsulates, for me, both organizational leadership–I’m the president of a college, so I think about this a lot with my team–and also public policy.
And, you contrast what you call a leader-leader organization versus a leader-follower.
Now, leader-follower–everybody knows that there is a boss, called the leader, and the boss tells people what to do. That’s what bosses do, isn’t it? I mean, that’s what the leader does. The leader tells people what to do. And, in economic policy, we would call that top-down.
The alternative in economic policy is bottom-up–letting people make their own individual decisions with the information they have. And, you call that a leader-leader organization, which is basically: instead of having followers, you’re creating leaders among your team and your staff.
And, here’s the part I like. So, a leader-leader, a bottom-up organization, is where the, quote, “the governing principle is to push authority to those with the information, not push information to those with the authority.”
So, in the leader-follower organization, the boss curates all the inflow. People make reports to the boss so the boss can make the good decisions. In a leader-leader organization, the boss empowers the people who already have the information to make those decisions. And, by the way, not just at the end of the week or the end of the month, but often in real time.
And that is, for me, the gold standard–when possible. It’s not possible in every public policy area. Obviously, there are areas where government has to make decisions, and leaders–the politicians–have to make decisions, and heads of bureaucracies have to make decisions. But, in the best kinds of situations, it’s the people who make the decisions because they’re close to the information.
And, I’ll just close with this and let you respond. A friend of mine said, ‘How many organizations have you been in that are top-down, where the people who have their boots on the ground–the people in the trenches–say: Oh, the boss is so great. The boss makes all the best decisions’? Instead of what really happens, which is, ‘The boss is an idiot. He doesn’t know anything. Why did he tell us to do X? He has no idea what’s actually going on.’
And, that is the essence of military–good military–leadership in time of war. I’m sitting here in Israel, which is famous for empowering its soldiers to make decisions in real time, where a hierarchy is incredibly minimal relative to other armies. And, it’s a good lesson for life.
David Marquet: Yeah. So, that, I think, is a legacy–when I was running the submarine, I took over the worst-performing submarine in the fleet, and I was trained for another submarine. So, I didn’t know the detailed way to operate the submarine. And, what I needed was more thinking. I didn’t need more compliance. I didn’t need people to nod their heads and do what they were told. I needed people to think.
We dealt with this in a lot of hard ways, but the short story is: it started with me refusing to give them orders. I would just refuse to tell them what to do. And then, they had to come to me.
If you say, ‘Hey, I think 737 MAX is a great product. We’ve got the FAA [Federal Aviation Administration] on board. We’re going to catch up to Airbus,’ blah, blah, blah. ‘What do you guys think?’ you may get someone speaking up who is independently wealthy and doesn’t really care about their job–but you’re probably not.
And then, later, the reason we do that is so that we can say, ‘Well, you guys had a chance to speak up.’ It is not because I’m really interested in an honest conversation about it.
So, we speak industrial-age English, is what I now call it. Why? Because during the Industrial Age, the workforce was largely illiterate. Not dumb, but uneducated. And so, work and life are built of these two basic building blocks: thinking and doing. And, it’s always: I got to balance, is this a time for action or is this a time for pause and contemplation? And, we got to balance those two things.
The way an industrial-age organization saw that is: they simply divided the world into a caste system where the people on top did the thinking, and the people on the bottom did the doing.
And then, we thought we became enlightened, where we said, ‘Oh no, we’re going to ask the doers what they think.’ But, it’s still a little bit shy of actually letting them make decisions, because I’m still holding all the cards. I may say words like, ‘Oh, you’re empowered,’ and blah, blah, blah. But, in the context of this industrial-age English, where I then ask questions that are, ‘Is that going to work?’ ‘Uhhhh, yeah.’ So, these binary questions also are a component of this industrial-age English. And, they’re just microcoercions to basically stop people from thinking–again, go along with your decision, which is what we wanted. In the Industrial Age, we didn’t want people to bring their brains to work.
Of course, now that’s all changed. And so, we see all these organizations wring themselves upside down and inside out to try and get thinking. They know they want thinking. They know thinking. But, at the bottom level, when the CEO is running a meeting, they still do it in the same old way, using the same old language patterns.
And, we don’t have a transcript from when Boeing made this decision. I’m not even sure if they made a deliberate decision. But, we all know, from the external evidence, that the CEO [Chief Executive Officer] was publicly behind it–on and on–and that the test pilots in the simulator knew the thing was acting wildly. But, it didn’t get out. It didn’t get acted on. And, we have that.
And so, when you look at situations like Deepwater Horizon, or Boeing 737, or Volkswagen, the Wells Fargo ‘Eight is Great,’ or all these–basically the worst kind of things that organizations have done recently–it’s the exact same pattern. It’s this industrial-age, English, where people are told what to do. And the reason that’s so pernicious is because it gives people permission. It gives them excuse. It absolves them of responsibility. ‘I knew it was messed up. I knew it was wrong, but the boss told me to do it.’
Russ Roberts: Yeah. Before I forget, I just want to mention, when we talk about information, I’m going to use your quote again: “When you push authority to those with the information, not push information to those with the authority.”
The classic example in 20th-century economics was whether market behavior and market forces could be improved on by a deliberate effort from the top down to allocate resources to the most valuable things. Could use a computer to do that. It’s–the calculation debate, it was called. And we had an episode on it recently–I think it was with Pete Boettke.
But, if you listen to Adam Smith, who uses 18th-century language, or Vernon Smith–no relation, Nobel Prize winner–the way Vernon talks–or Hayek–Vernon talks about it very powerfully, is, basically: You’ve got information in the heads of the millions of people out in the world, and you need to aggregate that information in some way to make good decisions. One way to aggregate it is: Everybody sends the information up to the top, and then they use some algorithm–or, if we’re lucky, rather than their own corrupt personal goals. But, you send that information up to the top to make a, quote, “good decision.” Because then the person has more information than any one individual.
The miracle of the marketplace and markets is that prices encourage that information to be acted on without a single person [?] having to have that information. Letting prices emerge and result from competition among buyers and sellers, is one of the most extraordinary human achievements that there is.
And, we don’t fully understand it. I would argue most economists struggle with it. I sometimes don’t fully appreciate it.
But, to go back to this question of within an organization–as opposed to the national policy issue–the other piece of this, which you talk about in passing–and, by the way, we’ll put a link up to your talk at Google about some of these leadership issues when you were on the submarine. It’s a fantastic talk. I loved it.
It’s not just that you’re missing an opportunity to get information from the rank and file, who often know a lot more than you do. It takes all the fun out of work.
No one wants to be a drone. Right? When you empower someone, you don’t just get a better decision. You get a workplace that’s more engaged and paying attention. And, I think people often forget that.
And ideally–I don’t always live up to this ideal–but as the president of a college, I see my role ideally as being the person who worries about risk, reward, tradeoffs, and decisions: that, it’s hard to appreciate any one person in their daily activity. But, we’re making a decision about what’s best in their area. It’s a bad system if you think you as the outsider can make a better decision because you’ve made more decisions than they have.
The only time that comes into play is on the subtleties of risk and reward–and especially the worries of deep downside risk. Deep downside risk, that there has to be someone who takes responsibility for it. Because everybody within an organization is often going to be biased toward risk-taking because they’re not going to pay the price for that. But, the CEO, or the head of the organization, needs to worry about that. And that’s their main job.
I’ve criticized Netanyahu here in Israel because of what he just recently said–on October 7th, it wasn’t his fault. Well, history will make that call, not him. But, that’s his job. His job is to make sure that a few thousand people don’t come over the border, rape, murder, and kill a bunch of Israeli citizens. That’s his main job. It’s not what he thinks of every day, because if you’re not careful, you forget about it because it’s a low-probability event. But, as the CEO, or the head of the organization, or the captain of the submarine, you have to focus on the low-probability disaster–because you’re the one who bears the–is worrying about it, is going to think about it naturally, if you’re doing your job.
Russ Roberts: Tell the story of when you tried to get the submarine to speed up on its electric motor as an example of how the mindset of an employee or a person on staff changes in different kinds of organizations.
David Marquet: Yeah. So, I like to poke fun at the employees at Volkswagen for going along, or Wells Fargo, or Boeing, or whatever–but it happened to me. I did it. I did it myself.
When I was a brand-new captain of a submarine, I was transferred to the ship at the very last minute because the captain resigned, and I wasn’t trained for it. And so, I took over.
And, by the way, they were also the worst-performing submarine in the fleet with the worst morale.
So, I took over. We go to sea. It’s the very first day. It’s at the end of the day, it’s past midnight. It was hard getting to sea, checking all the blocks, making sure the reactor and everything was just right. We were all exhausted. But, I was bound and determined to run this first exercise, which was to shut down the reactor and pretend there was a fault with it and see how the team reacted.
And, it was a very tense time on a nuclear submarine because you only have one reactor. When you don’t have it, you’re sort of creeping up to the surface. And then, when you get to the surface, you can use your diesel engine.
Russ Roberts: So, this is a drill that you’re doing at the end of your first day, which is–but you’re going to show them that you are not going to cut corners, and–
David Marquet: Right, right, right. Yeah, we’re not going to cut–I’m the new guy. I’m there to fix them. I’ve been the fixer in the Navy, and I had a career of going to places that needed help and, quote, “fixing them,” on the dint and the power of my great decision-making. And, we’re not going to let a little thing like the fact that we’re all exhausted and it’s 1:30 in the morning stop us.
So, the exercise starts, and I’m standing in the control room. Most of the activity takes place back in the engine.
A couple minutes go by, and things seem to be going okay. And, the officer is doing the right thing. He shifts to the backup motor, which is this electric motor. And, he’s creeping up–conserving the battery–up to the surface where we’ll eventually be able to get the diesel engine running and start providing a very small amount of supplementary power, but enough to get us home if we can’t get the reactor fixed.
I really want to test my crew, because I’ve been told over and over they’re the worst crew in the Navy, so I want to see how bad it is. So, I get the idea that, ‘Hey, let’s speed up’–which is the way, on all the older submarines which I’d served, there was another speed on this motor.
And, I said, ‘So, hey, let’s speed up on this electric motor.’ And, the officer, who’d been there over two years, gave the order just like this.
And, the poor sailor, who is sitting, who is supposed to just turn the knob–to order this thing–his shoulders go up like this. And, I’m standing behind him, and I say, ‘Hey, what’s going on?’
He says, ‘Captain, on the Santa Fe, it’s a one-speed motor. There is no second gear.’
And, I have to tell you, that was like a hammer blow to the head. Because, I was immediately internally focused. I looked down at my shoes. I was there to fix them, and I’d made this huge mistake.
I mean, submarine captains know all the answers. This is like, ‘What color is your car?’ ‘Oh, I can’t remember.’ It’s so basic.
And, that’s when everything got better. Because I said, ‘Stop the drill. Officers, assemble. We’ve got to talk about this.’ And, that’s when I made the vow: never give another order.
Russ Roberts: But, you did ask your second-in-command why he told–because he knew.
David Marquet: Right. Yeah, yeah, yeah. So, I look over. I looked at the officer.
Well, first, I’m really internally focused. I’m thinking about myself and how this makes me look, blah, blah, blah, blah, blah. It’s all about me. It’s a classic immersed mindset.
So, then I have this lightbulb–boom: I actually didn’t order it. I suggested it. It’s the officer who was the one actually giving these specific commands to the ship.
And, I said, ‘Hey, did you know about this?’ He kind of gives me the smirk–annoyingly–and he says, ‘Yes, sir, I did.’
I said, ‘Why did you order it?’
And, we all know what he said: ‘Because you told me to.’
The way I think about it now is: When you give an order–when you tell someone what to do–you give them a little ticket that says, ‘But, don’t bother thinking. Shut down your brain, because I’m doing the thinking for the two of us.’
And, this is the–the most underutilized thing in all these huge organizations–the militaries, the governments, these big companies, I am convinced, over and over and over, having over a thousand interactions with companies since my first book came out, it’s what’s up here: It’s the brainpower of the total organization.
And, what you want is not to–you personally, when you’re sitting near the top of one of these–you being twice as smart is going to make zero difference. Getting everyone in the organization to be 1% smarter will make a huge difference.
And so, that’s what you want to work on over and over and over and over, in my opinion, over and over and over and over and over again. And, good leadership is a journey towards irrelevance. Because you’re going to leave one day. And, if you haven’t left a good organization behind–there is a big question about Apple–in my mind and others’–‘Okay, what’s going to happen when Jobs dies?’
And, Tim Cook’s there now. They seem to be doing pretty well. Because I was skeptical. I said, ‘I don’t know about Jobs because the way he kind of leads–it’s kind of like he’s the guy, he’s the genius, he makes the decisions.’ But, we now see, it looks like maybe there’s other people thinking at Apple. Thank goodness.
Russ Roberts: Yeah, that’s a tough one. History–again, I’ll make a judgment there–I think Apple is a very successful company. Can’t deny it. It’s not an extraordinary company anymore without Jobs. And, he’s maybe one of a kind. And I’ll say this about him, by the way: I remember when the book came out, Walter Isaacson’s book, and a lot of people read it and told me about it. I very quickly made a decision I wasn’t going to read it. And, I made that decision because it was pretty clear what people were telling me was in the book. It’s that he was a jerk. And I knew that already. So, I need to read a book about–a 700-page book or whatever it is. But, I started it, and I love that book. It’s a phenomenal book, because that is not what the book’s about. That’s what a lot of people took away from the book because there was a certain exposure, a baring of secrets about Jobs, many of his flaws. He had many flaws–
David Marquet: His family–
Russ Roberts: His family–
David Marquet: ‘Oh, we can find all these problems. Let’s unmask the emperor.’
Russ Roberts: But the thing that I took from that book was how much people wanted to work with him, because he brought out the best in them. It’s true: He was a visionary; he imposed his vision on everybody. He would say that people don’t know that they need it. ‘I’ll teach them if they need it. They’ll find out that they need it,’ his arrogant self-centeredness that we all look down on in certain dimension.
But, he wasn’t a jerk in the normal sense of the word because people loved the right kind of person, loved who could handle it, loved working for him. And it’s clear why. It’s because they did great things. So, he made decisions that are famous. ‘Oh, the inside of the Mac is going to look just as good as the outside–even though no one’s going to ever see it–because that’s going to make us a certain kind of organization.’ And, you think, ‘Well, that’s expensive. I don’t know. Is that really worth it?’
And so, we hear about these sort of famous decisions he made where he imposed his will on the team. But, that can’t be the whole story. So, I think stereotyping him as this sort of old-fashioned leader-follower guy is not the whole story.
David Marquet: Yeah. Let me just close. I’ll tell you one quick story about that.
I think that’s okay. Part of the genius of the human species is that we have this big, broad distribution from risk-seekers to risk-avoiding people. It’s that distribution that keeps the species alive. Some people got to go on the far side of the valley, go over the mountain range, and they’re not going to come back. But, eventually someone’s going to come back, and the whole species is going to be better for it. I made one of those decisions on the submarine. People, they’ll read my book and say: Oh–they kind of get a feeling, this touchy-feely teddy bear. That was not the case.
Russ Roberts: Yeah: ‘Anything goes. You just let them do whatever they wanted because you were the–‘
David Marquet: No, no, no. I mean, you know that. But, I worked really hard on the structure. I really worked really hard on the structure.
So, for example, we had this problem where–this is, like, six months into it. Things were going really, really well. Then all of a sudden I get this gut punch where a guy goes UA [Unauthorized Absence]. We’re pulling in to San Diego. He crosses the brow to the pier and he says, ‘I’ve had enough of this’–sort of in sailor talk–and has up[?]. And, long story short–
Russ Roberts: You say ‘UA’?
David Marquet: Yeah, Unauthorized Absence. He AWOLed [Absent without Leave].
Russ Roberts: Okay. He quits.
David Marquet: Yeah. He quit.
And so, I’m thinking about it, and I’m talking to my guy–his supervisors. I’ve got this whole line of people. And, it turned out the guy hadn’t had any sleep for, like, two days. And, I felt bad because I sort of remember seeing him all the time. But, there were a lot more people who were more directly responsible for taking care of their people.
I was really not happy about this, so I personally went and found the guy–who was just on base someplace in the barracks trying to get some sleep.
So, none of this really made sense. And, instead of punishing him, I gave him sort of a way out. Which he took.
And, I came back, I said, ‘We’ve got a new rule. And the rule is: No one can have a watch rotation cycle better than someone under them.’ And, the way it was on the ship was people at the bottom were on watch, like six on, six off, or six on, 12 off. Six hours on, 12 hours off. And then, as you got higher and higher, your motivation to rise in the ranks was then you became six on, 18 off. You got more and more sleep. And, I said, ‘This is not what I mean when I say take care of your people. So, here’s the rule. If the watch below you is six on, six off, you’re going to be six on, six off.’
And because everything is the hierarchy in the submarine, that meant the most senior guys were six on and six off. They did not like it. They would have never elected this thing.
But, the most amazing things happened because then they filled in the ranks below. They got the right people qualified. And then, pretty soon the whole submarine was one in four, which is really unheard of. It’s man for one in three. And so, we’re giving hundreds of hours of free time back to the sailors, and everyone’s getting more sleep. The advancement rate went up because the sailors had more time to study.
Russ Roberts: The thing I liked about the not-giving-an-order is that sometimes you would know what the right thing to do was, but you’d pretend you didn’t. And, again, that gave the staff the ability to gather information rather than saying, ‘Oh, I don’t need to do this because David will know.’ And also, you weren’t always shooting him down by saying, ‘Oh yeah, I already knew that. Let me tell you what to do.’ So, talk about that for a minute, and then we’ll come back to distancing.
David Marquet: So, not giving an order–there’s two nuances. First of all, it’s not really true. I gave orders when it came to controlling language and structure. So, the way we ran a meeting–so for example, one of the things that we did was we vote first, then discuss something.
Most groups, if I say, ‘Hey, I need you to make a decision. What do you think the price of oil is going to be on December 31st?’ they’ll discuss it and then they may take some kind of a vote. And, this is the wrong way to do it. What you want to do is let everybody vote, like, ‘Hey, write your number down. Don’t talk about it because you contaminate it. Write it on a card. Everyone show your card.’
Now, step two: embrace the outlier. So, I imposed rules on process, which resulted in the better decisions just coming up naturally. But, I tried to stop–I was pretty successful stopping making decisions about, ‘Hey, load this torpedo. Start the reactor. Shut down the reactor, whatever it is–reposition the submarine of the north,’ because the process resulted in the decision-making machine plopping out a worthy decision at the end. And, the way I think about it is–Go ahead.
Russ Roberts: No, go ahead.
David Marquet: Yeah. So, one of the things I thought about was: how do I want to show up as a leader? And, it’s sort of a silly question because for 20 years of my naval career, I said, ‘Well, that’s obvious.’ I call it the knowing/doing axis. Or knowing/telling axis. I want to know the answer, of course, and I want to get my team to do it by telling them, ‘Hey, let’s do it.’ And, by doing that, I’m moving the team forward or making progress, the product’s going to come out sooner, whatever.
And so, those things were linked. Because of my experience on the Santa Fe, I ended up transitioning through all four of those quadrants where, first of all, I went to not knowing, but telling; and then not knowing, not telling. And, it’s actually not that hard if you don’t know the answer to not tell the team what to do. If the team comes to you with a big problem and say, ‘Well, I don’t know. Should we launch this new product or invest money in this new product?’ and you don’t really know, it’s like, ‘Well, hey, what do you guys all think?’ That’s not that hard. It’s when you think you know.
But I’d seen the benefit. And, the more time I spent on the submarine, the more I learned things, and the more I was susceptible to being lured back in that knowing/telling. But I’d seen how powerful it was when I kept my mouth shut and saw what these guys thought.
And, for some things I would step in and say, ‘No, we’re not going to do it that way. We’re going to do it this way.’ And, I didn’t give a big lecture. I just said, ‘Here’s why,’ whatever. ‘Let’s keep going.’ And, no one–hurt no one feelings.
So, at the end, where I think you want to be as a leader is you want to know the answer–because you’re the goalie–but don’t tell them. You can know the answer; you can decouple these two things in your head. Stop being so impulsive. Know the answer, but then hold it back. Even if you think at the end of the–‘Hey, go work on that for a day. Come back.’ Even if you know tomorrow when they come back, you’re going to tell them what to do. It doesn’t matter. They’ve worked on it for a day; they’ve exercised their brains. And, now you know what they would do without you, which is super-valuable.
Russ Roberts: So, we talk a lot on the program about the virtues of saying ‘I don’t know,’ but I usually talk about that when I don’t know. It’s even more powerful–and it takes more courage–to say ‘I don’t know’ when you do know. And, that’s a beautiful example and story.
Russ Roberts: I want to talk about Elle Cordova–I don’t know how to pronounce her name. She’s a–I don’t know what she is–she’s an Internet person. She’s famous for a dialogue between a bunch of fonts–typefaces–talking to each other. It’s a clever thing. It has millions of views.
But, she has a much more powerful story, in my view, that you talk about. And, I want to just share it with the listeners, and you can comment on and expand on it if you want.
She says: Imagine you are having a bad day. It’s a rotten day. You’re on the couch maybe, you’re doomscrolling through social media, or maybe you’re flicking through channels on your TV, or you’re going between tabs on your computer, and, just, you’re in a grey mood. You’re just not happy. It’s just one of those days.
And, she suggests: Fast-forward. And, she has a nice way of talking about it, but basically: imagine yourself decades from now. Go through all the transitions. Imagine speeding up your life. You watch yourself maybe get married, have kids, get old, get sick, lose friends, etc.
And, all of a sudden, you’re on your deathbed.
And she says, ‘Imagine there’s a technology, and on the last day of your life, you’re going to get to experience exactly what it was like on one single day.’
It’s a little bit like Nozick’s experience machine–which we’ve talked about many times on the program. But: You’re going to get one day. It’s going to be chosen at random. What if they chose today? This day, when you’re having this awful, laying-on-the-couch, doomscrolling, mediocrity of a day?
And, it’s a brilliant experiment. Because it basically says: Well, don’t waste today. What if today is the day that they come back to? What if it’s the day that gets chosen?
And so, go outside. She says, ‘Feel the sun on your skin. Call your friends that you haven’t talked to in a long time so you can re-experience that.’
And, what it’s really saying is: live your life to create memories of what you might enjoy in the future. But, more than that: Life is finite. Don’t throw it away. Live it to the fullest. It’s a beautiful image.
I’ll just say for the record, I kissed my wife last night one time more than I would have because I thought of that story. And, if that’s all it accomplishes, it’s not a small thing. But I think it’s a beautiful thing.
David Marquet: Oh, well, thanks for telling me. Well, reminds me of the story–it’s an amazing story. You get to relive one day and it’s today. Stop moping around. There’s a British neurosurgeon who has got a book out, and he’s basically retired; he is in his 70s at this point. But at one point he got cancer. And so, now he’s on the other side of the medical system. And, he describes, ‘I was moping around, I was feeling bad for myself, Blah, blah, blah. And then, he kind of did the same thing, but he chose the be-someone-else vector where he said, ‘So, I’d imagine if I had a friend who was in this situation, what would I tell him? Oh, your life is now more limited than you thought it was, and you’re going to spend it moping around?’ Like, ‘What? You’re an idiot.’ And so, that’s how he coached himself.
But, again, I think that these are super-powerful stories. And, you just got to get out of this–again–the immerse state: it’s me here and now. And, we know that the more sort of that pressure of the, ‘Okay, I need to respond immediately. Oh, I just was slighted. I got to speak up.’ The more urgent it feels is probably it’s a signal that it’s more necessary. Take a pause, jump out, and everything will be better. You’ll be more emotionally regulated. You’ll see it more clearly that it really is not that–yeah, it’s not imaginary. It’s not that this doesn’t matter, but it’s just not as important in the big scheme of things as your brain is trying to make it right now.
Russ Roberts: So, let’s close with what you just mentioned in passing, because when I was reading the book for a while, part of the time I thought it’s a great idea. It’s really interesting. It could be very useful. I can imagine many times in my life I wish I’d done this. But sometimes, it’s hard to remember to do it. Because, it’s easy to say it, ‘Oh yeah, just be the coach.’ But, when you’re under pressure and life is coming at you fast; and you talk at the end of the book, which I love, about the pause–you just mentioned it in passing–you can use that to sensitize yourself to taking a break, which gives you that tiny opportunity to think about what you’re actually doing rather than just being compelled by events. So, talk about that for a couple minutes.
David Marquet: Yeah. We spend so much time reacting–I always say the most important reader of the book is the author. At least that’s for my books. I’m target number one, because this exactly happened to me, just the other day after I’d written this book where I was in a conversation, I kind of got emotional, and I said something, and I was like, ‘Oh, that would have been a good time to pause and distance.’ It’s easy to see afterwards.
But, here’s the thing. We know that there are certain situations where the likelihood that you’ll feel more immersed is higher and that therefore you might want to take a pause before you go into them.
For example, if it’s a performance and you’re feeling under pressure–and when I mean[?] performance, I mean anything where you’re going to be judged–an annual feedback session, for example, but going on stage or making a presentation could also be the same thing. Landing an airplane where you’re being evaluated to be certified in the next bigger aircraft. Any of these kinds of things–and these are stressful situations.
Time pressure is another one, a sense of urgency. If you’ve been slighted–one of the really interesting studies is they had doctors walk down the hallway. They were in one room, they were going to go to the other room and give a diagnosis. And, unknownst to the doctors in this little short hallway walk, some of them got bumped by someone kind of rudely–
Russ Roberts: Yeah, that’s awesome–
David Marquet: who did, rather than apologizing, said something like, ‘Watch where you’re going.’ So, these people were bumped into and treated poorly on the way. Well, guess what? The ones who suffered through that made worse diagnoses. Well, that’s kind of bad. You don’t want that.
So, if that happens to you, don’t make any big decisions. Take a minute, recompose yourself, meditate, whatever you need to do, and then come back to it having forgotten that and with a fresh, calm perspective. Because people’s lives–whether you’re landing an airplane or doing surgery or making a decision about operating a nuclear power plant–people’s lives are going to matter.
Russ Roberts: My guest today has been David Marquet. His book is Distancing. David, thanks for being part of EconTalk.
David Marquet: Thanks for having me on the show. Thanks for your listeners.
