Presenting the Complex

 Audrey recently finished watching the HBO mini-series Chernobyl, which has the same showrunner as our current infatuation The Last of Us. It is absolutely brilliant television, dramatically recreating one of the world's greatest industrial tragedies and the heroic efforts needed to undo a situation created by greed, ambition and secrecy.

But one of the highlights for me was the show trial at the end. The trial was a political requirement so the Soviet people (and to a lesser degree, the rest of the world) could rest assured that the culpable parties were punished, and thus, repetition of the accident practically impossible.

During the trial, atomic scientist Valery Legasov (Jared Harris) must explain the accident at Chernobyl Nuclear Power Plant #4 in such a way that the military, judicial and political judges understand it. Conveniently, this means he must also explain it in a manner so that the viewers (like myself) can also understand it. 

Legasov must do this without 3D computer animation (as there was no such thing in 1987) or any other technological crutches. That he manages to do so with a simple set of red and blue placards and a display board was absolutely spellbinding to me.

A reactor does two things, he explains: it increases reactivity (the red cards) and decreases reactivity (the blue cards). Uranium atoms begin splitting (red) but then boron control rods dampen the reaction (blue). He takes us through a normal set of reactions and controls and the resulting generation of electrical power, demonstrating the complex balancing act keeping everything in check. 

He then recreates the accident, which saw power levels lowered, which then created a series of effects that removed a number of red cards and left far more blue cards on the display, reflecting the foundering of the reactor and explaining the loss of power production. But he breaks it down in such a way that when an improper action is taken, even a liberal arts graduate like myself can not only understand but actually anticipate what is going to happen. 

In a series full of dramatic and human moments, this technical presentation felt like the highwater mark to me (and not just to me, but to this energy litigator who outlines it far better than I do in this LinkedIn article).

I think part of why it resonated with me so deeply is because I work in pensions.

No, seriously - hear me out. 

Pensions, particularly defined benefit pension plans like the ones I work with, are not only complex but also highly counter intuitive. There is no direct correlation between the amount of money a person (and their employer) contributes and the monthly pension they eventually draw from the plan. I mean, there is an indirect linkage, sure, as those contributions are a percentage of their pay, but even those rates can go up and down over time.

But the actual pension is derived from a formula and the only two variables in that basic formula are how long did you work (pensionable service) and what were your five highest earning years taken as an average (highest average salary). 

The other thing about pensions is that you can end up talking to plan members with an incredible range of both education and understanding; you could speak to the Chief Financial Officer of a major metropolitan hospital on one call, and then to the person who empties their wastebaskets. And ironically, the custodial person might have a better understanding of their pension, as it represents the majority of their retirement income, and they may have educated themselves out of a sense of necessity.

But people from all walks of life end up calling in, many of them making incorrect assumptions that their pensions are similar to other financial products, or are bound by rules they have heard around the water cooler. And sometimes folks have a hard time wrapping their heads around the fundamental basis of pensions, like the fact they are a lifetime benefit that does not run out or exhausted. I shared this example with my coworkers last week:

I had kind of a breakthrough during one of those familiar conversations about "why can't I see my employer's contributions on my statement?" I had explained that these cons are not used in any calcs, but employee cons with interest are shown because a CV [commuted value]-based payout cannot be any lower than that.

He wasn't really interested in the CV though - he kept coming back to "but if employer cons aren't used, why should the employer even pay anything?" [At this point it is clear to me he doesn't understand the key principle of the lifetime benefit.]

I said, "let's try a different tack - let's say you quit on Jan 1 of 2022, the day after the info on the statement we are looking at. See how you have a base pension of $500 a month? Imagine you get to age 65 and start receiving that - it's about $6,000 a year, right?

"Well, after 7 yrs, you will already have earned more from the pension than your $39K in cons, right? And 7 years after that, more than your employer's cons as well, and you will still only be 79..."

And he goes, "ah, I get it!"

Probably the most satisfactory moment I have had on the phone all year!

It was a great reminder to me of how important it is to sometimes forget what you know, and try to see things from an outside perspective; something the writers of Chernobyl clearly understood. 

Too bad I can't use coloured cards on the telephone.