My Journey from Accounting to International Security

The Professor

It was the fifth, and final year of my Master’s program in accounting when I realized that accounting wasn’t for me.

I was enrolled in a course called “Accounting for Risk” — a seemingly boring title for a class that was anything but that. The course was taught by a PhD student. From the start, we could tell he wasn’t like the other professors. He wore jeans and flip flops to class every day, had tattoos painted across his left arm, and was rarely clean shaven. He looked more like a washed-up surfer from Malibu, than a student earning his PhD in Accounting.

The first day of class, he told us his story. Like many of us, he had graduated with his Master’s in Accounting and went on to work for one of the “Big 4” accounting firms. The pay was okay, and like any accountant will tell you, the hours were dreadfully long. He described some days being spent at his cubicle “gouging his eyes out” after hours spent reading excel sheets. These were all warnings we had heard before — warnings which would be brushed off after looking at the six-figure salary a partner earns, or the “street cred” that becoming a Certified Public Accountant provides.

“So why get a PhD?” I asked.

He looked up slowly and said, “Because that’s where the creativity begins.”

Accounting is unique in that it’s very difficult to master, but also incredibly simple. Accountants have to know every aspect of business: Marketing, Finance, Economics, etc. But the main goal is simple: Know GAAP (the rules of accounting), and the Tax Code. Even at the Master’s level, your goal is to memorize, not think. Only once you get to the PhD level do you have to move past memorizing the rules, and really use your brain.

What made this course interesting, was for one of the few times in our program we were forced to think outside of the rules. By the end of the course, I had completely changed the way I think.

We were given three options for books to read, and had to pick one. All three seemed weird for an accounting course. One was about regulatory efficiency, the second about behavioral economics, and the third about forecasting. On a whim, I decided to go with the third book, Superforecasting: The Art and Science of Prediction. By the end of the book, I had developed a newfound interest in world affairs, and a burning excitement to predict future events. I would have to learn to think creatively again.

The Tournament

Over the past few decades, the U.S. Intelligence Community (IC) has faced some major defeats, and been forced to take a hard look at its mistakes. In the early 1990s, after the end of the first Gulf War, the U.S. was caught off guard when it found Saddam Hussein’s nuclear development program had progressed much further than expected. Years later, the IC failed to prevent the September 11 attacks against the World Trade Center, and soon after that made embarrassingly incorrect claims about weapons of mass destruction in Iraq. Intelligence was failing, and something needed to change.

The Intelligence Advanced Research Projects Activity (IARPA) was tasked with improving the IC’s prediction abilities. At first using space in newspapers, IARPA funded the development of forecasting tournaments to find the best forecasters and learn their methods. Ordinary citizens were challenged to answer complex geopolitical questions that spanned well into the future. For example: Will there be a violent confrontation between China and one or more of its neighbors by March 2018 in the South China Sea?

One group of researchers was exceptional at finding good forecasters. By taking the top 2% of forecasters from the population (Who were crowned “Superforecasters”), and combining them into teams, researchers found that the superforecasters became even more accurate in their predictions. When these teams of superforecasters were placed against career intelligence analysts, individuals with access to troves of classified information, the superforecasters’ predictions were found to be 30% more accurate. IARPA had found who they were searching for. 

So what sets these superforecasters apart from the rest of the world, and professional analysts in the Intelligence Community? Mainly, superforcasters vigilantly track when they’re right and when they’re wrong, and adjust their forecasts accordingly. Pride is set aside in addressing failures, and replaced with an open-mind for adjusting their old predictions.

Even more important, the process by which superforecasters predict events is systematic, and arguably obsessive. Superforecasters start by removing the details of a challenge — exposing the question to its most naked form. From there, they create a base-line prediction using research of past events. They then adjust their base-line prediction by adding more details to the question, until its back to its original form. The final prediction is then updated (often daily) as new events and information emerge.

But the coolest part about superforecasters? They are all ordinary people. One of the best superforecasters IARPA worked with was simply an IT consultant. Others were just avid readers of the newspaper and history. However all of them found joy in learning new things. After finishing the book, I decided I would become the next superforecaster.

The Prediction

IARPA’s tournament was called The Good Judgement Project, and it’s still run today. The first prediction I found regarded military action in the Middle East. Having little knowledge on the rich culture and history of the region, let alone recent military activity, I began reading everything I could on the subjects. I quickly found that the question was a lot more complex than, say, whether or not to expense a certain item on a company’s books. There was no handbook, set of rules, or court precedent to guide the way. This would be a test of creative thinking.

The complexities of geopolitics are staggering – thousands of pieces moving toward outcomes of immeasurable importance. I quickly found that the past five years I hadn’t enjoyed studying accounting, I had simply felt comfortable with it. Studying International Affairs was difficult. The questions were high-stakes, and the answers always included uncertainties. But through the challenge, I found fulfillment. The Good Judgement Project made me question the world and change the way I think. It made me want to learn again.

I hope to share the products of my research in this blog. Feel free to learn with me.