Where Is Our Nate Silver?

Jay Jaffe _03 01 2013

In case you missed the 2012 presidential election in the United States, one election guru, Nate Silver, batted nearly 1.000 in predicting the state-by-state presidential results and just missed predicting the winners in all of the 33 Senate races. Silver’s FiveThirtyEight blog is now the standard by which all other election predictions are measured.

But Silver did not just become a rock star level statistician as a result of his 2012 election predictions—he did two other things. First, Silver’s work has changed the election landscape. For the foreseeable future, election predictions will be made using modeling tools and data such as used by Silver. And, second, he has established in the minds of the public the credibility of statistical models as a tool for predicting political events. This latter accomplishment is not only significant in and of itself, but also because it offers a golden opportunity for other statistical based professions, such as actuaries, to capitalize on this realization to improve how they interact with their various constituencies.

In the February/March issue of the SOA’s the Actuary magazine, I wrote a “point of view” posing my thoughts on why the actuarial profession needs its own Nate Silver. There are at least two good reasons it would be helpful to have one or more actuaries with Silver’s public presence and communication skills/savvy.  You can read about my reasons in the magazine however, here’s a hint — think raising visibility.

So, here, in the real-time cyber world, I’m encouraging a discussion.   What do you think?  How can we, as a profession, help develop or identify this person?  Is there a role for the SOA to play in the development of our Nate Silver?  What concrete, compelling examples can we offer that best highlight our expertise? Or, even better — do you know an actuary who is already our very own Nate Silver?

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Discussion

One response to "Where Is Our Nate Silver?"

  • robert says:

    Having ‘our own Nate Silver’ seems appealing on the surface (I followed the story with enthusiasm) but I don’t anticipate the profession succumbing to this for the following reasons:

    a) Sticking our necks out is anathema to the profession. When we actually do well at predicting or managing the financial risk of Exciting Events, we wipe our brow and move on rather. There have been few press conferences announcing the company’s continued solvency.

    b) Exciting Events to us are catastrophes. No one likes a chicken little, especially a chicken little who gives a range of potential outcomes.

    c) Lack of Sexiness. Not exclusively, but in large part (or primarily) we deal with insurance-related risks. In many cases they are risks that everyone bears (life, property, health), removing most glamour.

    d) Jinxing the name. Having the public visibility of a Nate Silver-style may focus unwanted media attention on us, possibly leading to those who root for our name to be tarnished. Think of Jamie Dimon or the guys described in Michael Lewis’ The Big Short – the Median Joe probably despises them.

    I am all for a higher plane of communication among the profession. For example, I applaud our Social Security actuaries for responding in full force to criticism in the New York Times (http://www.ssa.gov/oact/NOTES/pdf_notes/note150.pdf). As Krugman later wrote it was “a brutally polite intellectual takedown”. We should strive to blog and tweet and place our opinions among the business-intelligentsia.

    As much as I would root for them, though, I’m not sure Rock Star Actuaries will be a boon to the profession.

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