Opinion

For example, I remain deeply concerned about the long-term trajectory of our debt to G.D.P. ratio. Yet during the Covid crisis, I publicly supported the $1.9 trillion rescue plan proposed by President Biden and backed by all but one congressional Democrat. Someone with a more absolutist mind-set might see these two positions as mutually exclusive. But I examined the likely costs, did the same with the likely benefits, and then made a judgment that the latter outweighed the former. Performing that kind of analysis — one that doesn’t shy away from nuance and complexity — is an essential element of sound decision-making.

Employing the yellow pad also helps one learn the right lessons from the past. Here, the mistake people too often make is to judge a prior decision solely based on the outcome that occurred. Outcomes do matter. But they’re not all that matters.

One common way in which outcomes can be deceiving involves pursuing a course of action with a high potential benefit but a low chance of success. This is what happened during the Clinton administration when the Russian economy fell into crisis and we had to decide whether to support it. We concluded that intervention was unlikely to work. But we also concluded that, in the unlikely event an intervention did work, it would be so beneficial to our efforts to foster political reform in Russia (something that was at the time a realistic possibility) that it was worth trying despite the low odds of success. As it turned out, the higher probability outcome occurred, and we had to abandon our intervention.

A few years later, at the end of my term, the incoming Treasury secretary from a new administration said this proved that the United States and the International Monetary Fund made the wrong call regarding Russia. I remember being frustrated, not by the fact that a new administration disagreed with the previous one but by the argument the incoming secretary employed: that our efforts had not proved successful, so therefore we had been wrong to try. (When asked why he approved of our economic intervention in Mexico, which was similar to that in Russia, he again pointed to outcomes: “What I liked about it is that it worked.”) Evaluating decisions solely based on outcomes rather than also analyzing the judgments that led to the decision and took place before those outcomes occurred can cause leaders to learn the wrong lessons going forward.

There is no secret that will allow us to overcome the most dangerous and difficult challenges we face. There is, however, a pressing need for leaders of today and tomorrow to make the best possible decisions in an uncertain world. To borrow the spirit of Mrs. Collins’s question, what we will become — as individuals, as a country, and even as a planet — is likely to depend on it.