Human Tendency Toward Loss Aversion Makes Rapid Resolution To Systemic Racism Impossible

This is more of a thought experiment, so apologies in advance for any errors.

It’s difficult not to be cynical when you think about the mountainous task of ridding American society of systemic racism. Just the mere term “systemic racism” carries a tremendous amount of weight. It’s like trying remove all the chunks of apple from an apple pie or cookies and cream ice-cream of all the little bits of Oreo cookies.

Unless you go to the very beginning and setup the system again, it’s very difficult to imagine how one would go about creating a society without the layers upon layers of implicit racism. It’s not like humans can reset to factory settings—the ones we had when we first came out of the womb—and then reboot with a completely new operating system that doesn’t include all those subconsciously-racist lines of code that were surreptitiously inserted into our psyche.

The other option involves making the victims of systemic racism whole by giving up what the collective society has presumably acquired over the years and propping up the injured segment of society (i.e. transfers of wealth, creation of a fixed percentage of seats in congress, senate, courts, boardrooms, workplaces, etc. for members of the victim party).

This latter suggestion makes sense—in theory—but in practice it is all but impossible simply due to the human psychological tendency toward loss aversion. I view loss aversion as like a super power of how our brain works. When I first read about loss aversion, I remember thinking that its level of importance to our internal decision-making is at par with to how important the laws of gravity are to the physical world.

I think a proper definition is in order, so let’s head to Wikipedia: “loss aversion refers to people’s tendency to prefer avoiding losses to acquiring equivalent gains: it is better to not lose $5 than to find $5.” Moreover, people weigh choices using an internal reference point (i.e. their current position in life). If that wasn’t enough, the two psychologists who first coined this term, Daniel Kahneman and Amos Tversky, also note that losses and gains are viewed asymmetrically in our brains, meaning impending losses are viewed more adversely than potential gains! The last bit is what throws a big wrench into the problem.

If you take a second to process that definition, then you might come to similar conclusions about society’s longstanding battle with systemic racism: A) good luck getting a large segment of the non-African-American population to give up things they currently possess because, while they might sympathize with the grievances, they don’t think they are the responsible party. B) if (A) is a no-go, then does the government take on huge debts to pay reparations? Or maybe, C) do we break down all institutions and start again?

See what I mean? Getting rid of systemic racism will undoubtedly take a long time—possibly even generations—to accomplish simply because you need a fresh batch of people who don’t have such a high loss aversion threshold in order to make the required changes. Having said that, there’s no better time to try than during a global pandemic!