On the Edge, the new book by the brilliant political forecaster and poker player Nate Silver, is one of the most interesting works of the post-Covid era. As the author notes, the pandemic has exposed a significant divide not only among individuals but, more importantly, between elites: risk preference.  

However, On the Edge is not merely about intra-elite rivalry. It could inspire reflection on the essence of Western exceptionalism.  

Aside from the gallery of colourful and fascinating characters Silver interviews in his book — ranging from the tech nerd cum financial criminal Samuel Bankman-Fried to famous poker players and a female astronaut — what stands out most is the typology of elites he introduces. Silver describes America as divided into two ecosystems of people and ideas, which he calls “The River” and “The Village”, representing different ways of perceiving the world and addressing its challenges. 

The most intellectually sophisticated subset of the River (which one would call the “probability mindset class”) consists of rationalists and effective altruists. Then, there is the Midriver, which includes Silicon Valley and Wall Street, venture capitalists and hedge funds. What the author refers to as Downriver consists of gamblers who attempt to create their own luck in casinos and other places, rationally seeking an “edge” — an elusive advantage that helps them beat the odds. 

What sets Riverians apart is, as was already mentioned, their style of thinking. Decoupling comes naturally to them — a cool intellectual approach that, in the words of Sarah Constantin, is “the ability to block out context … the ability to separate, to view things in the abstract, to play devil’s advocate.” 

Another trait that sets them apart is the propensity for contrarian thinking. To beat the market or the odds, one cannot be afraid to challenge the consensus. When Riverians seek answers, they are neither swayed by the pressure to conform nor fearful of how others will feel about their convictions. 

A high tolerance for risk completes the picture of the probability mindset class. Breaking from the consensus and going against the grain is not the safest career path. However, Riverians are not driven exclusively by a natural attraction to risk; they are calculated, and they approach their bets and decisions through the lens of game theory. It dominates their intellectual toolkit. Silver defines it as “the mathematical study of the strategic behavior of two or more agents (‘players’) in situations where their actions dynamically impact one another.” 

While the River steers clear of establishment institutions, people in the Village work within the bureaucracy, government, academia, or media. What matters here is not contrarianism but the ability to discern the direction in which the prevailing consensus is evolving or, in the parlance of venture capitalist Marc Andreessen, “the Current Thing”. They prioritise tribal loyalty over the skill of impartial, abstract thinking. Riverians accuse Villagers of being too political, claiming that they view facts solely through the prism of political allegiance. 

The Village is principally left of centre politics and the Democratic party. Today, the conflict between the River and the Village continues in earnest, with the New York Times suing OpenAI and Wall Street billionaires campaigning to remove Ivy League university presidents. It was Covid that revealed this profound difference, when it was apparent that experts were driven more often by political loyalty than by scientific evidence (for example, withholding studies on vaccine effectiveness until after the American presidential election). While the Riverians are a rag-tag bunch, the Village is ideologically homogenized, creating a kind of cognitive bubble that comprises the American establishment. The Riverians are for free speech, the Village for political correctness; the former regard the market as the best of non-human-designed mechanisms, the latter see in all things natural a form of injustice. Distrust of the ruling classes intellectually and politically reinforces in Riverians the attitude of generalists: the inclination to lateral thinking needed to figure out the truth on their own.  

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Silver notes that during the pandemic, crypto-currencies became “the proletariat’s way to gamble.” Together with day trading and sports gambling, it provided a way for young men without economic prospects to improve their position in the wealth distribution in the absence of other opportunities. This observation leads us to another thinker, Reuven Brenner, an economist for whom risk constitutes the core of reflection on society.  

In his works, such as World of Chance: Betting on Religion, Games and Wall Street, Brenner seeks to dispel the myths that have formed around gambling. He cites a number of contemporary studies that prove there is no link between gambling and crime or other behavioral disorders. It is simply an unconventional social mobility strategy. Not surprisingly, at a period when young men are having a harder time, many are looking for other channels to improve their lot. 

The role of gambling and games of chance in the development of the West, especially America, is still underestimated. Silver seems to have an inkling of this when he writes that risk-takers began winning continuously in history starting in 1776. Gambling often functioned as a banking institution, and clearinghouses or investment banks have their roots in gambling establishments. In America, where people were reluctant to pay taxes, both the federal government and states held lotteries to fund infrastructure or public buildings. New York had 140 of them, Philadelphia more than 200, also in the South it became customary to finance public projects with lotteries. Lottery brokers set up big banks like Chase National Bank. 

The ability to take risks and a certain instinct towards heterodoxy are sorely lacking in Western elites

Western ruling classes are seized by a mimetic mania, which, as thinker Robin Hanson rightly pointed out, was particularly evident during the pandemic, when countries did not actually differ in their approach to the virus, but blindly followed a consensus that changed over time. “Elites all over the world talk, and then form a consensus, and then authorities everywhere are pressured into following that consensus. Regulators almost everywhere are quite reluctant to deviate from what most other regulators are doing,” Hanson explained. He compares these elites to foraging tribes that establish a consensus among themselves, from which none dares to deviate in order to avoid losing their status within the group. 

The ability to take risks and a certain instinct towards heterodoxy are sorely lacking in Western elites. The West differed from all other civilizations in that it established institutions that encouraged broad experimentation. Today’s elites, with their blind safetyism, put that in peril. 

On the Edge also attempts to outline possible scenarios that the future may bring. One is a pessimistic vision of Casino Capitalism, where a ruthless part of the River uses AI-powered algorithms to manipulate people’s desires and behavior and squeeze the last penny out of them. The second vision involves deliberately halting the progress of AI in the name of a green, sustainable future.  

One regrets that there is no effort to sketch out possible changes in the wider geopolitical context. Silver has written a book about America, but the reader wishes he had addressed issues such as the attitude toward risk among elites in other great powers, like China or Russia. Would more Riverian elites bring a safer world or a more unpredictable one? How would it affect nuclear deterrence, for example? Regardless of the fact that On the Edge arouses rather than satisfying intellectual hunger, it is a book that every European should read. It is a voice from another world to which we once belonged. And a reminder that the fate of our countries depends on the vital few who are willing to take risks and the institutions that allow them to do so.