This is what Taleb means when he says this type of “heads I win, tails you lose” privilege is possessed by executives. He adds that “this system is called ‘incentive-based’ and supposed to correspond to capitalism. Supposedly managers’ interests are aligned with those of the shareholders. What incentive? There is upside and no downside, no disincentive at all.” In short, “no skin in the game.”

Likewise, when Congress abdicated their constitutional war-declaring authority to President George W. Bush in 2003, members of Congress and their families had no skin in the game. These politicians who gave Bush the power to unlawfully invade Iraq paid no price. Indeed, they retained their upwardly mobile status. The White House with its mass propaganda machine and the cowardly Congress paid no penalties for violating the Constitution.

Had there been a law requiring the drafting of able-bodied, age-qualified members of their families whenever the government plunged the country into war, these legislators would have had a personal downside. There would have been deliberative public hearings, where some of the hundreds of vocal anti-war retired high military, national security and diplomatic officials would have exposed the Bush/Cheney lies, deceptions and cover-ups leading to catastrophe for the people of Iraq, the U.S. economy, and military families who especially suffered the downsides.

via Having “Skin in the Game” | The Nader PageThe Nader Page.
HatTip to @DaveMc9ee