Science Writing Prize 2012 – Mark Henderson
The 2012 Wellcome Trust Science Writing Prize, in association with the Guardian and the Observer, opened last week. Between now and the competition deadline, we’ll be hearing from established science writers about a piece of science writing they admire and what makes it so good.
When it comes to building a compelling narative about a complex subject, Michael Lewis is the best in the business, says Mark Henderson.
That’s because, when it comes to building a compelling narrative about a complex factual subject that most ordinary readers would find rather arcane, Lewis is quite simply the best in the business. And as David Dobbs – himself a fine exponent of the art of nonfiction – put it to me at this year’s Science Online festival in January, the narrative structures, characterisation and explanatory approach that Lewis deploys to make collateralised debt obligations and on-base percentage sing are just as applicable to science as they are to investment banking and sports statistics.
You don’t have to like baseball, or even know anything about it, to love Moneyball. You don’t have to understand sub-prime mortgages to be gripped by The Big Short – indeed, the less you know to begin with, the more remarkable you’ll find it.
It’s no accident that both Moneyball and The Blind Side were made into highly successful Hollywood movies, which performed well even in countries where few people follow American sport. The storylines, the characters, the ideas, are so strong that you’re drawn into a field you might never otherwise have explored. Despite yourself, you discover that you care.
What Lewis does to perfection is to take highly technical subject matter that the uninitiated regard as comprehensible only to nerds, and turn it into a story that can’t help but fascinate. Does that sound like something a good science writer should be able to do?
Lewis’s first and most important trick is the simplest. He never takes the view that a subject is going to be too complex for his readers to understand. But he also accepts that he won’t bring his readers with him if he plunges straight into a stream of incomprehensible jargon.
It’s almost as if he’s read and digested a maxim set out by the Guardian’s own Tim Radford in his Manifesto for the Simple Scribe. “If in doubt, assume the reader knows nothing,” says Radford. “However, never make the mistake of assuming that the reader is stupid. The classic error in journalism is to overestimate what the reader knows and underestimate the reader’s intelligence.”
Lewis achieves that by taking the reader on a journey of discovery. It’s usually led by a protagonist who is seeking to understand something complicated. In Moneyball, it’s the manager of the Oakland Athletics, Billy Beane, who learns to use sophisticated statistics developed by baseball enthusiasts such as Bill James to compete with the riches of the New York Yankees.
In The Big Short, his masterful deconstruction of the sub-prime mortgage crisis that did for Lehman Brothers, it’s a small group of investors, hedge fund managers and bankers who spotted that lending large sums of money to fundamentally insolvent housebuyers was bound to end in tears. In Boomerang, it’s the author himself who travels to Greece, Iceland and Ireland to discover why their economies collapsed in the chaos that followed.
As he tells these personal stories, Lewis slips in the difficult stuff along the way. He feeds in just enough technical information to allow his readers to follow what’s happening and understand his characters’ motivations, without ever leaving them gasping for air. He explains by helpful analogy, and recaps his explanations at useful intervals.
These actors are often flawed. What’s to like about investors who made hundreds of millions of dollars from the US economy blowing up? Yet because you travel with them, learning as they do, you find yourself rooting for them. You start to see the opportunities they see, to the point that you can anticipate what’s coming. Almost without realising it, you become wiser about a hitherto unintelligible world.
Chapter two of The Big Short – which was excerpted in Vanity Fair, and works almost as well as a standalone article – illustrates this beautifully. It begins by introducing you to Michael Burry, a 32-year-old hedge fund manager. Burry, you discover, wanted to understand the sub-prime mortgage bond market. And Lewis explains pithily what he found:
A giant number of individual loans got piled up into a tower. The top floors got their money back first and so got the highest ratings from Moody’s and S&P, and the lowest interest rate. The low floors got their money back last, suffered the first losses, and got the lowest ratings from Moody’s and S&P. Because they were taking on more risk, the investors in the bottom floors received a higher rate of interest than investors in the top floors. Investors who bought mortgage bonds had to decide in which floor of the tower they wanted to invest, but Michael Burry wasn’t thinking about buying mortgage bonds. He was wondering how he might short, or bet against, sub-prime mortgage bonds.
That’s all in the first paragraph of the piece. Lewis is describing a financial instrument called an asset-backed security, but he doesn’t use the jargon and assume you’ll know what it means. He doesn’t even introduce the term until a few paragraphs later, by which time you’re familiar with the concept. Instead, he uses everyday language and an analogy that intelligent readers can grasp. And he follows up with a kicker – Burry wanted to understand these bonds not because he wanted to invest in them, but because he thought they might fail.
He continues, turning financial jargon against itself to make his point, that these securities were complex because they were a smoke-and-mirrors trick to present a poor risk as a better one:
But as early as 2004, if you looked at the numbers, you could clearly see the decline in lending standards. In Burry’s view, standards had not just fallen but hit bottom. The bottom even had a name: the interest-only negative-amortising adjustable-rate sub-prime mortgage. You, the homebuyer, actually were given the option of paying nothing at all, and rolling whatever interest you owed the bank into a higher principal balance. It wasn’t hard to see what sort of person might like to have such a loan: one with no income. What Burry couldn’t understand was why a person who lent money would want to extend such a loan. ‘What you want to watch are the lenders, not the borrowers,’ he said. ‘The borrowers will always be willing to take a great deal for themselves. It’s up to the lenders to show restraint, and when they lose it, watch out.’ By 2003 he knew that the borrowers had already lost it. By early 2005 he saw that lenders had, too.
The opportunity presented, Lewis introduces an obstacle. You’re now convinced, like Burry, that these bonds were doomed to fail. Yet the investor had no way to bet against them. Cue the introduction of another complex instrument: the credit-default swap, a kind of insurance policy that allowed Burry to place his wager. By linking these Byzantine devices, Lewis forces you to make the effort to understand them. You want to know how Burry is going to place the bet that seems impossible – and you’re already getting a fair idea of how it’s going to play out.
Then comes the backstory. Who is Michael Burry?
He sensed that he was different from other people before he understood why. Before he was two years old he was diagnosed with a rare form of cancer, and the operation to remove the tumour had cost him his left eye. A boy with one eye sees the world differently from everyone else, but it didn’t take long for Mike Burry to see his literal distinction in more figurative terms. Grown-ups were forever insisting that he should look other people in the eye, especially when he was talking to them. ‘It took all my energy to look someone in the eye,’ he said. ‘If I am looking at you, that’s the one time I know I won’t be listening to you.’ His left eye didn’t line up with whomever he was trying to talk to; when he was in social situations, trying to make chitchat, the person to whom he was speaking would steadily drift left. ‘I don’t really know how to stop it,’ he said, ‘so people just keep moving left until they’re standing way to my left, and I’m trying not to turn my head anymore. I end up facing right and looking left with my good eye, through my nose.’
Burry is an oddball. We later learn he has Asperger’s syndrome. But he’s also a human being. He’s about to make a ton of money from others’ financial misfortune, but you don’t mind. In fact, you will him to succeed. As the story progresses, you feel, as he does, that the banks on the other side of the bet are craven idiots who deserve to be fleeced. Strange as he might seem, Burry is a crusader for sanity in a mad world.
By this stage, you’re so drawn in that you struggle to fathom how anybody could think differently. Yet many of Burry’s investors haven’t got the point: they scramble to pull out of his hedge fund, at the very point when you understand enough to know that they should be doing the reverse. You, the reader, now feel yourself to be smarter, with a better grasp of sub-prime mortgage bonds, than some of the smartest people on Wall Street. Of course, by now you know that they were never that smart at all.
Michael Burry is the little boy in The Emperor’s New Clothes. Michael Lewis is Hans Christian Andersen.
Find out more about the Science Writing Prize on the Wellcome Trust website – the closing date is 25 April 2012.