1. In general, risk is a word used to describe adverse consequences that occur by chance. Depending on its probability/ consequence characteristics, a risk can be a mere nuisance, a source of unwelcome (and possibly quite costly) variability, or a danger to our existence. We need to carefully delineate these properties when dealing with risk.
2. Risk is a physical property of the world, not some abstract mathematical concept. To understand risk, we need to understand its physical properties. Mathematical analysis is not enough. To be useable, the analysis must be concrete, not abstract.
3. Statistical risks manifest themselves over a relatively observable time frame, and are amenable to management via cost/ benefit calculations based on "averages", or expected values. Catastrophic risks are rare, but their consequences enormous. We don't get a "second chance". They can not be treated statistically since in the long run, there is no long run (the "Catastrophe Problem").
4. In dealing with high-stakes risk, uncertainties due to knowledge imperfection enter. The probabilities of rare, complex events simply can not be known with any degree of precision. We need to consider uncertainty due to knowledge imperfection, in addition to randomness, when making decisions about these risks.
5. The crucial first step in the high stakes decision process is recognizing the possibility of serious adverse consequences, i.e., those exposures that may fall into the "Danger Zone" . We need to be especially cautious with exposures that may increase the natural, or "background", level of risk.
6. When risks are catastrophic, only two decision criteria make sense: Precautionary avoidance, or fatalistic acceptance ("if it happens, it happens"). There is no in-between. Reconciling the two is the key function of risk management.
7. Precautionary avoidance of catastrophic risks can be expensive. By avoiding some risky activities, we may also forego critical benefits. The result is Risk Dilemmas: We are doomed if we do, doomed if we don't. Post-fact risk management - managing catastrophic risks only after they become entrenched - exacerbates the dilemma. The careful analysis of alternatives, early on in the process of planning for progress (i.e., preaction), can help eliminate these dilemmas.
8. Those affected by high-stakes risks must ultimately make the decisions about their treatment. To prevent against the threat of being mislead, intentionally or unintentionally, decision makers need to cultivate their innate intuitions about risk.
