Thai restaurant business plan

S w
907B01
THAIFOON RESTAURANT
Anuj Chandarana wrote this case under the supervision of
Elizabeth M.A. Grasby solely to provide material for class
discussion.
The authors do not intend to illustrate either effective or
ineffective handling of a managerial situation. The authors may
have
disguised certain names and other identifying information to
protect confidentiality.
Ivey Management Services prohibits any form of reproduction,
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Reproduction of
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of
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(519) 661-3208; fax (519) 661-3882; e-mail [email protected]
Copyright © 2007, Ivey Management Services Version: (A)

2008-04-30
It was the middle of May 2005. Eddy Phimphrachanh, whose
family owned and managed several Thai
food restaurants in Canada and the United States, sat at his
desk, determined to decide whether to open
Thaifoon Restaurant (Thaifoon) in downtown London, Ontario.
From a young age, Phimphrachanh had a
desire to start a restaurant of his own. Having received advice
from his family and others in the business
community, he was eager to open the restaurant and to live out
his dream provided that all the pieces of his
business plan looked favorable. If he proceeded, Thaifoon
would begin operating January 1, 2006.
THE CITY OF LONDON, ONTARIO
Phimphrachanh was inclined to open Thaifoon Restaurant in
London, Ontario, in order to stay close to his
family and friends. London, the 10th largest metropolitan area
in Canada, was located halfway between
Toronto, Ontario, and Detroit, Michigan. The city’s population
of approximately 356,000 was expected to
increase to over 374,000 people by 2011. Major industries
included education, health care, tourism and
manufacturing.1
Downtown London
Downtown London was of particular interest to Phimphrachanh.
In recent years, the City of London had
invested over $110 million in downtown large-scale projects to

revitalize the area, including the
construction of the John Labatt Centre, the Covent Garden
Market, public park improvements, and
upgrades to Museum London and the Central Library.2
1 Source: City of London files, http://www.london.ca, and
Wikipedia online encyclopedia,
en.wikipedia.org/wiki/London,Ontario, January 5, 2007.
2 Source: MainStreet London, a publicly funded downtown
revitalization group that sponsors and encourages façade
improvements, recruits new quality retail and business tenants,
promotes safety and cleanliness, facilitates retail peer
support and promotes downtown events and festivals. Do
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This document is authorized for educator review use only by
MUHAMMAD ATHER ELAHI, Institute of Business
Administration until Sep 2021. Copying or posting is an
infringement of
copyright. [email protected] or 617.783.7860

9B07B001
The John Labatt Centre was a 10,000-seat venue for sports
events and entertainment groups. It was ranked
the third largest venue in Canada in ticket sales, behind the Air
Canada Centre in Toronto and the Bell
Centre in Montreal, with over 600,000 ticket sales in its first
year. The John Labatt Centre attracted high-
profile concerts, including Cher, Elton John, Rod Stewart,
Nickelback and Our Lady Peace. The Covent
Garden Market was a popular destination for eating, shopping
and local festivals. The market attracted
37,000 people a month and an even greater number when
festivals and farmers’ markets were taking place
on site.
The private sector was also investing in the establishment of
new businesses and the development of new
residential areas in the downtown core. The number of
residential units had increased from 2,700 in 1996
to 3,800 in recent years. As well, there were approximately 500
businesses operating in the core. By
2005, over 30,000 people worked in downtown London, and
over 100,000 residents lived within three
kilometres of the downtown core.3
EDDY PHIMPHRACHANH
By 20 years of age, Phimphrachanh had garnered considerable
experience, academically and in terms of
hands-on experience, in the restaurant industry. He had
graduated from the Hotel, Restaurant and Casino
Management program at Westervelt College, where he took

courses in front-desk operations, sanitation,
food and beverage management, hotel management, casino
management and bartending. He also enrolled
in and successfully completed Smart Serve Ontario,4 Workplace
Hazardous Materials Information System
(WHMIS)5 and the Wine Council of Ontario (WCO)6
certification courses.
Additionally, Phimphrachanh worked in his aunt’s three popular
Thai food establishments in London (Thai
House, Thai Delight and Bangkok Pad Thai) in multiple
capacities including dishwashing, serving and
bartending. His mother was the dining room manager and his
father helped with general maintenance at
these same restaurants. Phimphrachanh’s aunt was a valuable
source of knowledge and inspiration. She
encouraged Phimphrachanh to learn about all aspects of the
restaurant business and clearly conveyed that
he could earn a prosperous living owning and managing his own
restaurants. She was not worried that his
restaurant would pose a competitive threat since the location
and customer profile would likely be
different, and she thought there was enough demand to support
four restaurants in the London area.
In terms of opening Thaifoon, Phimphrachanh’s primary
objectives were to:
1. Gain knowledge and experience as an entrepreneur in the
restaurant business.
2. Be personally involved with all critical aspects such as menu
selection, restaurant design, website
design and public relations.
3. Financially support a comfortable lifestyle while following
his passion.

4. Contribute to the revival of London’s downtown core.
5. Expand his business and personal networks.
3 Ibid.
4 Smart Serve Ontario has been developed to provide
information about safe alcohol service at work and at home,
https://smartserve.org, January 5, 2007.
5 WHMIS is Canada’s national hazard communication standard.
The key elements of the system are cautionar y labelling of
containers of WHMIS “controlled products,” the provision of
material safety data sheets (MSDSs) and worker education and
training programs, http://www.hc-sc.gc.ca/ewh-semt/occup-
travail/whmis-simdut/index_e.html/, January 5, 2007.
6 WCO is a non-profit trade association with a leadership role
in marketing and establishing policy and future directions for
the wine industry in Ontario. It acts as a liaison and co-
ordinating body between Ontario wineries, grape growers, and
government groups, http://winesofontario.org/, January 5, 2007.
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THE RESTAURANT INDUSTRY
The foodservice industry in Canada was vibrant, innovative and
large. There were over 62,500 restaurants,
cafeterias, snack bars, pubs and catering locations in Canada,
most of which were owned and operated by
local independent entrepreneurs. The industry provided jobs for
more than one million Canadians. The
average profit in the foodservice industry was 3.6 per cent. The
largest expenses were food (37.5 per cent)
and labor (31.1 per cent). The average Canadian foodservice
operator realized annual sales of $614,290 in
2004, with a pre-tax profit of $22,114. Foodservice sales were
projected to grow to more than $50 billion
in 2006, representing 3.8 per cent of Canada’s gross domestic
product.7
To understand London’s specific data, Phimphrachanh turned to
the Yellow Pages. There were over 550
restaurants in London and, of those, approximately 10 were
Thai restaurants. When reviewing more
closely the restaurants in the downtown core, he found that
there were approximately 50 restaurants in the
core, five of which served Thai food; three of these were owned
by his aunt.

THE LOCATION
Phimphrachanh understood that his choice of location was
paramount to the restaurant’s success. He had
narrowed his search to the corner of Dundas Street and Talbot
Street, in the heart of downtown London
(see Exhibit 1) due to the location’s proximity to popular
entertainment venues such as the John Labatt
Centre, Museum London, Covent Garden and the Grand Theatre.
Foot traffic8 was particularly heavy at
lunch hour, given the proximity to several large corporate
offices. In addition, the rent at this location was
three to four times less than more prestigious areas of
downtown London, some of which were located one
or two city blocks from the Dundas Street and Talbot Street
location.
The location also entailed some risks. Phimphrachanh noticed
that approximately 50 per cent of the
neighboring units on Dundas Street were vacant. The street was
typically not busy after dinnertime since
there were very few establishments open after 5 p.m. The
chosen location had no available customer
parking, and only minimal parking was available on Dundas
Street.
Phimphrachanh had heard from MainStreet London9 that the
street was on the “road to recovery,” and he
had recently witnessed significant positive change. He
wondered whether he should look elsewhere or
settle on this location at the corner of Dundas and Talbot.
OPERATIONS
Seating Plan

Phimphrachanh had obtained a floor plan from the building’s
owner. The size of the kitchen, bathrooms,
bar, office and waiting area was pre-determined, but he would
be able to design the seating arrangement in
the dining area (see Exhibit 2).
7 Canadian Restaurant and Foodservices Association.
8 “Foot traffic” refers to people walking through an area, as
opposed to driving or using any other mode of transportation.
9 MainStreet London is a publicly funded downtown
revitalization group that sponsors and encourages façade
improvements, recruits new quality retail and business tenants,
promotes safety and cleanliness, facilitates retail peer
support and promotes downtown events and festivals. Do
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Although Phimphrachanh knew that his seating arrangement
would determine his capacity, which would
thereby affect sales projections, he was interested in keeping
the number of seats at or below 30 since this
avoided legal regulations requiring a licensed engineer design, a
second fire escape and other costly items.
Phimphrachanh was also keen on leaving enough space between
the tables and chairs for customers and
servers to walk. Any design should allow for a quick
modification to accommodate larger or smaller
groups. The tables chosen for the restaurant measured 2.5 feet
by 2.5 feet, and a 1.5 by two-foot space was
needed for each chair. Two other seating options included
booths or benches, which could be any length
and up 1.5 feet wide.
Financial Projections
In addition to investing $10,000 of his own savings,
Phimphrachanh’s aunt and mother had agreed to grant
him a $90,000, unlimited-term, no-interest loan to start the
business. They offered him these favorable
terms because they were convinced that his venture would be
successful. They also wanted to show their
appreciation to him for helping with the existing restaurants.
Furnishing the new restaurant would use approximately $85,000
of these funds. The furnishings were to
be amortized on a straight-line basis, over five years, with no

salvage value. Another $3,200 would be
used to purchase computer equipment, which had an estimated
life of three years and would be amortized
using the double-declining balance method, with no salvage
value. Phimphrachanh would also have to
make one-time purchases of a liquor licence and a master
business licence, amounting to $1,055 and $350,
respectively. These intangibles would be amortized using the
straight-line method over five years.
Phimphrachanh estimated sales based on the number of turns10
each day during the lunch and dinner hours
(see Exhibit 3). The restaurant would be open 52 weeks each
year. Phimphrachanh projected an average
lunch bill would amount to $12, of which $10 would be for food
and $2 for beverages. Similarly, he
projected an average bill at dinner would amount to $25 per
person, of which $20 would be for food and $5
for beverages.
Variable costs would include food (37 per cent of food sales),
labor (30 per cent of total sales), drink (25
per cent of drink sales), and credit card fees (two per cent of
credit card sales, which were projected to be
75 per cent of total sales). All other anticipated annual costs
are listed in Exhibit 4.
Phimphrachanh planned to keep approximately 15 days of food
inventory and approximately seven days of
drink inventory on hand. Upon moving in, he would have to
pay his landlord the first month’s rent of
$1,282 along with a deposit equal to the last month’s rent
payment of another $1,282. He would pay his
advertising, hydro, land phone, insurance, Internet, and mobile
phone expenses, approximately 15 days
after the invoices were received.

Phimphrachanh knew that restaurant sales were difficult to
forecast, given the unpredictability of
competitive and economic forces, and he wondered what his
financial projections would look like if he
were to fall short or exceed his sales estimation by 20 per cent.
If the restaurant’s results were to fall
drastically below expectations, there was no formal contingency
plan in place.
10 A turn refers to the number of times the restaurant’s capacity
is served. For example, if a restaurant has 50 seats, two
turns represents meal service provided to 100 customers. Do
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DECISION
Phimphrachanh was eager to open Thaifoon Restaurant. He
would consider his assessment of his own
capabilities, the attractiveness of the industry, the suitability of
the location, the seating plan selection and
related financial projections, including a projected income
statement and balance sheet for the year ending
December 31, 2006, before making a final decision. His aunt
had mentioned that if Phimphrachanh
wanted to be wealthy, he would have to open his own business.
To this end, one of his financial goals was
to be able to draw $100,000 from the business by the end of
fiscal year 2006. His expectation was loosely
based on his family’s Thai restaurant experience in London. He
appreciated the wisdom and support of his
mother and aunt, and he wanted, above all, to make sure that
their financial commitment to his success was
protected.
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Exhibit 1
PROPOSED LOCATION
Legend:
Thaifoon Restaurant
John Labatt Centre
Covent Garden Market (in which Thai Delight was located,
owned by Phimphrachanh’s aunt)
Central Library
Museum London

Ben Thanh Restaurant
Source: www.mapquest,ca
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Exhibit 2
PROPOSED FLOOR PLAN

Access to
kitchen
and bathrooms
14
' 9
4'2
19
'4
16'2
31
’
12'
Front Entrance
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Exhibit 3
PROJECTED SALES
Turns per Day
Monday Tuesday Wednesday Thursday Friday Saturday Sunday
Lunch 1.0 1.0 1.0 1.0 1.0 closed closed
Dinner 1.5 1.5 1.5 1.5 2.5 2.5 2.0
Source: Company files.
Exhibit 4

PROJECTED ANNUAL COSTS
Amortization* $ 19,414
Rent 15,384
Advertising 10,000
Hydro 8,000
Truck 6,840
Phone, Yellow Pages 6,480
Donations and sponsorships 3,000
Annual repairs and maintenance 3,000
Printing 2,000
Laundry 2,000
Miscellaneous 2,000
Cleaning supplies 1,950
Gas 1,920
Website 1,600
Insurance 1,200
Internet 720
Accounting services 650
Mobile phone 552
Staff uniforms 500
Office supplies 500
ADT (security system) 360
TOTAL $ 87,789
* (85,000 ÷ 5 years) + (3,200 × 2/3 years) + ([1,055 + 350] ÷ 5
years) = $19,414
Source: Company files.
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8
“This Article Won’t Change Your Mind”
Author: Julie Beck
“I remember looking at her and thinking, ‘She’s totally lying.’
At the same time, I remember something in my mind saying,
‘And that doesn’t matter.’” For Daniel Shaw, believing the
words of the guru he had spent years devoted to wasn’t blind
faith exactly. It was something he chose. “I remember actually
consciously making that choice.”
There are facts, and there are beliefs, and there are things you
want so badly to believe that they become as facts to you.
Back in 1980, Shaw had arrived at a Siddha Yoga meditation
center in upstate New York during what he says was a “very
vulnerable point in my life.” He’d had trouble with
relationships, and at work, and none of the therapies he’d tried

really seemed to help. But with Siddha Yoga, “my experiences
were so good and meditation felt so beneficial [that] I really
walked into it more and more deeply. At one point, I felt that I
had found my life’s calling.” So, in 1985, he saved up money
and flew to India to join the staff of Gurumayi Chidvilasananda,
the spiritual leader of the organization, which had tens of
thousands of followers. Shaw rose through the ranks, and spent
a lot of time traveling for the organization, sometimes with
Gurumayi, sometimes checking up on centers around the U.S.
But in 1994, Siddha Yoga became the subject of an exposé
in The New Yorker. The article by Lis Harris detailed
allegations of sexual abuse against Gurumayi’s predecessor, as
well as accusations that Gurumayi forcibly ousted her own
brother, Nityananda, from the organization. Shaw says he was
already hearing “whispers” of sexual abuse when he joined in
the 80s, but “I chose to decide that they couldn’t be true.” One
day shortly after he flew to India, Shaw and the other staff
members had gathered for a meeting, and Gurumayi had
explained that her brother and popular co-leader was leaving the
organization voluntarily. That was when Shaw realized he was
being lied to. And when he decided it didn’t matter—“because
she’s still the guru, and she’s still only doing everything for the
best reasons. So it doesn’t matter that she’s lying.’” (For her
part, Gurumayi has denied banishing her brother, and Siddha
Yoga is still going strong. Gurumayi, though unnamed, is
presumed to be the featured guru in Elizabeth Gilbert’s 2006
bestseller Eat, Pray, Love.)
But that was then. Shaw eventually found his way out of Siddha
Yoga and became a psychotherapist. These days, he dedicates
part of his practice to working with former cult members and
family members of people in cults.
The theory of cognitive dissonance—the extreme discomfort of
simultaneously holding two thoughts that are in conflict—was
developed by the social psychologist Leon Festinger in the
1950s. In a famous study, Festinger and his colleagues
embedded themselves with a doomsday prophet named Dorothy

Martin and her cult of followers who believed that spacemen
called the Guardians were coming to collect them in flying
saucers, to save them from a coming flood. Needless to say, no
spacemen (and no flood) ever came, but Martin just kept
revising her predictions. Sure, the spacemen didn’t show up
today, but they were sure to come tomorrow, and so on. The
researchers watched with fascination as the believers kept on
believing, despite all the evidence that they were wrong.
“A man with a conviction is a hard man to change,” Festinger,
Henry Riecken, and Stanley Schacter wrote in When Prophecy
Fails, their 1957 book about this study. “Tell him you disagree
and he turns away. Show him facts or figures and he questions
your sources. Appeal to logic and he fails to see your point …
Suppose that he is presented with evidence, unequivocal and
undeniable evidence, that his belief is wrong: what will happen?
The individual will frequently emerge, not only unshaken, but
even more convinced of the truth of his beliefs than ever
before.”
This doubling down in the face of conflicting evidence is a way
of reducing the discomfort of dissonance, and is part of a set of
behaviors known in the psychology literature as “motivated
reasoning.” Motivated reasoning is how people convince
themselves or remain convinced of what they want to believe—
they seek out agreeable information and learn it more easily;
and they avoid, ignore, devalue, forget, or argue against
information that contradicts their beliefs.
It starts at the borders of attention—what people even allow to
breach their bubbles. In a 1967 study, researchers had
undergrads listen to some pre-recorded speeches, with a catch—
the speeches were pretty staticky. But, the participants could
press a button that reduced the static for a few seconds if they
wanted to get a clearer listen. Sometimes the speeches were
about smoking—either linking it to cancer, or disputing that
link—and sometimes it was a speech attacking Christianity.
Students who smoked were very eager to tune in to the speech
that suggested cigarettes might not cause cancer, whereas

nonsmokers were more likely to slam on the button for the
antismoking speech. Similarly, the more-frequent churchgoers
were happy to let the anti-Christian speech dissolve into static
while the less religious would give the button a few presses.
Outside of a lab, this kind of selective exposure is even easier.
You can just switch off the radio, change channels, only like the
Facebook pages that give you the kind of news you prefer. You
can construct a pillow fort of the information that’s
comfortable.
Most people aren’t totally ensconced in a cushiony cave,
though. They build windows in the fort, they peek out from time
to time, they go for long strolls out in the world. And so, they
will occasionally encounter information that suggests something
they believe is wrong. A lot of these instances are no big deal,
and people change their minds if the evidence shows they
should—you thought it was supposed to be nice out today, you
step out the door and it’s raining, you grab an umbrella. Simple
as that. But if the thing you might be wrong about is a belief
that’s deeply tied to your identity or worldview—the guru
you’ve dedicated your life to is accused of some terrible things,
the cigarettes you’re addicted to can kill you—well, then people
become logical Simone Bileses, doing all the mental gymnastics
it takes to remain convinced that they’re right.
People see evidence that disagrees with them as weaker,
because ultimately, they’re asking themselves fundamentally
different questions when evaluating that evidence, depending on
whether they want to believe what it suggests or not, according
to psychologist Tom Gilovich. “For desired conclusions,”
he writes, “it is as if we ask ourselves ‘Can I believe this?’, but
for unpalatable conclusions we ask, ‘Must I believe this?’”
People come to some information seeking permission to believe,
and to other information looking for escape routes.
In 1877, the philosopher William Kingdon Clifford wrote an
essay titled “The Ethics of Belief,” in which he argued: “It is
wrong always, everywhere, and for anyone to believe anything
on insufficient evidence.”

Lee McIntyre takes a similarly moralistic tone in his 2015
book Respecting Truth: Willful Ignorance in the Internet Age:
“The real enemy of truth is not ignorance, doubt, or even
disbelief,” he writes. “It is false knowledge.”
Whether it’s unethical or not is kind of beside the point,
because people are going to be wrong and they’re going to
believe things on insufficient evidence. And their
understandings of the things they believe are often going to be
incomplete—even if they’re correct. How many people who
(rightly) believe climate change is real could actually explain
how it works? And as the philosopher and psychologist William
James noted in an address rebutting Clifford’s essay, religious
faith is one domain that, by definition, requires a person to
believe without proof.
Still, all manner of falsehoods—conspiracy theories, hoaxes,
propaganda, and plain old mistakes—do pose a threat to truth
when they spread like fungus through communities and take
root in people’s minds. But the inherent contradiction of false
knowledge is that only those on the outside can tell that it’s
false. It’s hard for facts to fight it because to the person who
holds it, it feels like truth.
At first glance, it’s hard to see why evolution would have let
humans stay resistant to facts. “You don’t want to be a denialist
and say, ‘Oh, that’s not a tiger, why should I believe that’s a
tiger?’ because you could get eaten,” says McIntyre, a research
fellow at the Center for Philosophy and History of Science at
Boston University.
But from an evolutionary perspective, there are more important
things than truth. Take the same scenario McIntyre mentioned
and flip it on its head—you hear a growl in the bushes that
sounds remarkably tiger-like. The safest thing to do is probably
high-tail it out of there, even if it turns out it was just your
buddy messing with you. Survival is more important than truth.
And of course, truth gets more complicated when it’s a matter
of more than just “Am I about to be eaten or not?” As Pascal
Boyer, an anthropologist and psychologist at Washington

University in St. Louis points out in his forthcoming book The
Most Natural Thing: How Evolution Explains Human Societies:
“The natural environment of human beings, like the sea for
dolphins or the ice for polar bears, is information provided by
others, without which they could not forage, hunt, choose
mates, or build tools. Without communication, no survival for
humans.”
In this environment, people with good information are valued.
But expertise comes at a cost—it requires time and work. If you
can get people to believe you’re a good source without actually
being one, you get the benefits without having to put in the
work. Liars prosper, in other words, if people believe them. So
some researchers have suggested motivated reasoning may have
developed as a “shield against manipulation.” A tendency to
stick with what they already believe could help protect people
from being taken in by every huckster with a convincing tale
who comes along.
“This kind of arms-race between deception and detection is
common in nature,” Boyer writes.
Spreading a tall tale also gives people something even more
important than false expertise—it lets them know who’s on their
side. If you accuse someone of being a witch, or explai n why
you think the contrails left by airplanes are actually spraying
harmful chemicals, the people who take you at your word are
clearly people you can trust, and who trust you. The people who
dismiss your claims, or even those who just ask how you know,
are not people you can count on to automatically side with you
no matter what.
“You spread stories because you know that they’re likely to be a
kind of litmus test, and the way people react will show whether
they’re prepared to side with you or not,” Boyer says. “Having
social support, from an evolutionary standpoint, is far more
important than knowing the truth about some facts that do not
directly impinge on your life.” The meditation and sense of
belonging that Daniel Shaw got from Siddha Yoga, for example,
was at one time more important to his life than the alleged

misdeeds of the gurus who led the group.
Though false beliefs are held by individuals, they are in many
ways a social phenomenon. Dorothy Martin’s followers held
onto their belief that the spacemen were coming, and Shaw held
onto his reverence for his guru, because those beliefs were
tethered to a group they belonged to, a group that was deeply
important to their lives and their sense of self.
Shaw describes the motivated reasoning that happens in these
groups: “You’re in a position of defending your choices no
matter what information is presented,” he says, “because if you
don’t, it means that you lose your membership in this group
that’s become so important to you.” Though cults are an intense
example, Shaw says people act the same way with regard to
their families or other groups that are important to them.
And in modern America, one of the groups that people have
most intensely hitched their identities to is their political party.
Americans are more politically polarized than they’ve been in
decades, possibly ever. There isn’t public-opinion data going
back to the Federalists and the Democratic Republicans, of
course. But political scientists Keith Poole and Howard
Rosenthal look at the polarization in Congress. And the most
recent data shows that 2015 had the highest rates of polarization
since 1879, the earliest year for which there’s data. And that
was even before well, you know.
Party Polarization, 1879-2015
Now, “party is a stronger part of our identity,” says Brendan
Nyhan, a professor of government at Dartmouth College. “So
it’s easy to see how we can slide into a sort of cognitive
tribalism.”
Though as the graph above shows, partisanship has been on the
rise in the United States for decades, Donald Trump’s election,
and even his brief time as president, have made partisanship and
its relationship to facts seem like one of the most urgent
questions of the era. In the past couple of years, fake news
stories perfectly crafted to appeal to one party or the other have

proliferated on social media, convincing people that the Pope
had endorsed Trump or that Rage Against the Machine was
reuniting for an anti-Trump album. While some studies suggest
that conservatives are more susceptible to fake news—one fake
news creator told NPR that stories he’d written targeting
liberals never gained as much traction—after the election, the
tables seem to have turned. As my colleague Robinson Meyer
reported, in recent months there’s been an uptick in progressive
fake news, stories that claim Trump is about to be arrested or
that his administration is preparing for a coup.
Though both Hillary Clinton and Donald Trump were disliked
by members of their own parties—with a “Never Trump”
movement blooming within the Republican Party—ultimately
most people voted along party lines. Eighty-nine percent of
Democrats voted for Clinton and 88 percent of Republicans
voted for Trump, according to CNN’s exit polls.
Carol Tavris, a social psychologist and co-author of Mistakes
Were Made, But Not by Me, says that for Never Trump
Republicans, it must have been “uncomfortable to them to feel
they could not be wholeheartedly behind their candidate. You
could hear the dissonance humming within them. We had a year
of watching with interest as Republicans struggled to resolve
this. Some resolved it by: ‘Never Trump but never Hillary,
either.’ Others resolved it by saying, ‘I’m going to hold my
nose and vote for him because he’s going to do the things that
Republicans do in office.’”
“Partisanship has been revealed as the strongest force in U.S.
public life—stronger than any norms, independent of any
facts,” Vox’s David Roberts wrote in his extensive
breakdown of the factors that influenced the election. The many
things that, during the campaign, might have seemed to render
Trump unelectable—boasting about sexual assault, encouraging
violence at his rallies, attacking an American-born judge for his
Mexican heritage—did not ultimately cost him the support of
the majority of his
party. Republican commentators and politicians even decried

Trump as not a true conservative. But he was the Republican
nominee, and he rallied the Republican base.
In one particularly potent example of party trumping fact, when
shown photos of Trump’s inauguration and Barack Obama’s
side by side, in which Obama clearly had a bigger crowd, some
Trump supporters identified the bigger crowd as Trump’s. When
researchers explicitly told subjects which photo was Trump’s
and which was Obama’s, a smaller portion of Trump supporters
falsely said Trump’s photo had more people in it.
While this may appear to be a remarkable feat of self-deception,
Dan Kahan thinks it’s likely something else. It’s not that
they really believed there were more people at Trump’s
inauguration, but saying so was a way of showing support for
Trump. “People knew what was being done here,” says Kahan, a
professor of law and psychology at Yale University. “They
knew that someone was just trying to show up Trump or trying
to denigrate their identity.” The question behind the question
was, “Whose team are you on?”
In these charged situations, people often don’t engage with
information as information but as a marker of identity.
Information becomes tribal.
In a New York Times article called “The Real Story About Fake
News Is Partisanship,” Amanda Taub writes that sharing fake
news stories on social media that denigrate the candidate you
oppose “is a way to show public support for one’s partisan
team—roughly the equivalent of painting your face with team
colors on game day.”
This sort of information tribalism isn’t a consequence of people
lacking intelligence or of an inability to comprehend evidence.
Kahan has previously written that whether people “believe” in
evolution or not has nothing to do with whether they understand
the theory of it—saying you don’t believe in evolution is just
another way of saying you’re religious. Similarly, a recent Pew
study found that a high level of science knowledge didn’t make
Republicans any more likely to say they believed in climate
change, though it did for Democrats.

What’s more, being intelligent and informed can often make the
problem worse. The higher someone’s IQ, the better they are at
coming up with arguments to support a position—but only a
position they already agree with, as one study showed. High
levels of knowledge make someone more likely to engage in
motivated reasoning—perhaps because they have more to draw
on when crafting a counterargument.
People also learn selectively—they’re better at learning facts
that confirm their worldview than facts that challenge it. And
media coverage makes that worse. While more news coverage of
a topic seems to generally increase people’s knowledge of
it, one paper, “Partisan Perceptual Bias and the Information
Environment,” showed that when the coverage has implications
for a person’s political party, then selective learning kicks into
high gear.
“You can have very high levels of news coverage of a particular
fact or an event and you see little or no learning among people
who are motivated to disagree with that piece of information,”
says Jennifer Jerit, a professor of political science at Stony
Brook University and a co-author of the partisan-perception
study. “Our results suggest that extraordinary levels of media
coverage may be required for partisans to incorporate
information that runs contrary to their political views,” the
study reads. For example, Democrats are overwhelmingly
supportive of bills to ban the chemical BPA from household
products, even though the FDA and many scientific studies have
found it is safe at the low levels currently used. This reflects a
“chemophobia” often seen among liberals, according to Politico.
Fact-checking erroneous statements made by politicians or
cranks may also be ineffective. Nyhan’s work has shown that
correcting people’s misperceptions often doesn’t work, and
worse, sometimes it creates a backfire effect, making people
endorse their misperceptions even more strongly.
Sometimes during experimental studies in the lab, Jerit says,
researchers have been able to fight against motivated reasoning
by priming people to focus on accuracy in whatever task is at

hand, but it’s unclear how to translate that to the real world,
where people wear information like team jerseys. Especially
because a lot of false political beliefs have to do with issues
that don’t really affect people’s day-to-day lives.
“Most people have no reason to have a position on climate
change aside from expression of their identity,” Kahan says.
“Their personal behavior isn’t going to affect the risk that they
face. They don't matter enough as a voter to determine the
outcome on policies or anything like this. These are just badges
of membership in these groups, and that’s how most people
process the information.”
In 2016, Oxford Dictionaries chose “post-truth” as its word of
the year, defined as “relating to or denoting circumstances in
which objective facts are less influential in shaping public
opinion than appeals to emotion and personal belief.”
It was a year when the winning presidential candidate lied
almost constantly on the campaign trail, when fake news
abounded, and when people cocooned themselves thoroughly in
social-media spheres that only told them what they wanted to
hear. After careening through a partisan hall of mirrors, the
“facts” that came through were so twisted and warped that
Democrats and Republicans alike were accused of living in a
“filter bubble,” or an “echo chamber,” or even an “alternate
reality.”
Farhad Manjoo’s book, True Enough: Learning to Live in a
Post-Fact Society, sounds like it could have come out
yesterday—with its argument about how the media is
fragmenting, how belief beats out fact, and how objective
reality itself gets questioned—but it was actually published in
2008.
“Around the time [the book] came out, I was a little bit unsure
how speculative and how real the idea was,” says Manjoo, who
is now a technology columnist for The New York Times. “One
of my arguments was, in politics, you don’t pay a penalty for
lying.” At the time, a lot of lies were going around about

presidential candidate Barack Obama—that he was a Muslim,
that he wasn’t born in the United States—lies that did not
ultimately sink him.
“Here was a person who was super rational, and believed in
science, and was the target of these factless claims, but won
anyway,” Manjoo says. “It really seemed like that election was
a vindication of fact and truth, which in retrospect, I think it
was just not.”
There was plenty of post-truth to go around during the Obama
administration, whether it was the birther rumors (famously
perpetuated by the current president) that just wouldn’t die, or
the debate over the nonexistent “death panels” in the Affordable
Care Act.
“I started to get a sense that my idea was probably realer than I
thought,” Manjoo says. “And then you had the 2016 election,
which confirmed every worst fear of mine.”
But the problem, Nyhan says, with “post-truth, post-fact
language is it suggests a kind of golden age that never existed
in which political debate was based on facts and truth.”
People have always been tribal and have always believed things
that aren’t true. Is the present moment really so different, or do
the stakes just feel higher?
Partisanship has surely ramped up—but Americans have been
partisan before, to the point of civil war. Today’s media
environment is certainly unique, though it’s following some
classic patterns. This is hardly the first time there have been
partisan publications, or many competing outlets, or even
information silos. People often despair at the loss of the mid-
20th-century model, when just a few newspapers and TV
channels fed people most of their unbiased news vegetables. But
in the 19th century, papers were known for competing for
eyeballs with sensational headlines, and in the time of the
Founding Fathers, Federalist and Republican papers
were constantly sniping at each other. In times when
communication wasn’t as easy as it is now, news was more
local—you could say people were in geographical information

silos. The mid-20th-century “mainstream media” was an
anomaly.
The situation now is in some ways a return to the bad old days
of bias and silos and competition, “but it’s like a supercharged
return,” Manjoo says. “It’s not just that I’m reading news that
confirms my beliefs, but I’m sharing it and friending other
people, and that affects their media. I think it’s less important
what a news story says than what your friend says about the
news story.” These silos are also no longer geographical, but
ideological and thus less diverse. A recent study in
the Proceedings of the National Academy of Sciences that
analyzed 376 million Facebook users’ interactions with 900
news outlets reports that “selective exposure drives news
consumption.”
Not everyone, however, agrees that the silos exist. Kahan says
he’s not convinced: “I think that people have a preference for
the sources that support their position. That doesn’t mean that
they're never encountering what the other side is saying.”
They’re just dismissing it when they do.
The sheer scale of the internet allows you to find evidence (if
sometimes dubious evidence) for any claim you want to believe,
and counterevidence against any claim you don’t want to have
to believe. And because humans didn’t evolve to operate in such
a large sea of people and information, Boyer says people can be
fooled into thinking some ideas are more widespread than they
really are.
“When I was doing fieldwork in small villages in Africa, I've
seen examples of people who have a strange belief,” he says.
“[For example], they think that if they recite an incantation they
can make a small object disappear. Now, most people around
them just laugh and tell them that’s stupid. And that’s it. And
the belief kind of disappears.”
But as a community gets larger, the likelier it is that a person
can find someone else who shares their strange belief. And if
the “community” is everyone in the world with an internet
connection who speaks your language, well.

“If you encounter 10 people who seem to have roughly the same
idea, then it fools your system into thinking that it must be a
probable idea because lots of people agree with it,” Boyer says.
“One thing you assume, unconsciously, is that these 10 people
came to the same belief independently. You don’t think that
nine of these are just repeating something that the 10th one
said.”
Part of the problem is that society has advanced to the point that
believing what’s true often means accepting things you don’t
have any firsthand experience of and that you may not
completely understand. Sometimes it means disbelieving your
own senses—Earth doesn’t feel like it’s moving, after all, and
you can’t see climate change out your window.
In areas where you lack expertise, you have to rely on trust.
Even Clifford acknowledges this—it’s acceptable, he says, to
believe what someone else tells you “when there is reasonable
ground for supposing that he knows the matter of which he
speaks.”
The problem is that who and what people trust to give them
reliable information is also tribal. Deferring to experts might
seem like a good start, but Kahan has found that people see
experts who agree with them as more legitimate than experts
who don’t.
In the United States, people are less generally trusting of each
other than they used to be. Since 1972, the General Social
Survey has asked respondents: “Generally speaking, would you
say that most people can be trusted or that you can’t be too
careful in dealing with people?” As of 2014, the most recent
data, the number of people saying most others can be trusted
was at a historic low.
(GRAPH OMITTED)
On the other hand, there’s “particularized trust”—specifically,
the trust you have for people in your groups. “Particularized
trust destroys generalized trust,” Manjoo wrote in his book.
“The more that people trust those who are like themselves—the
more they trust people in their own town, say—the more they

distrust strangers.”
This fuels tribalism. “Particularized trusters are likely to join
groups composed of people like themselves —and to shy away
from activities that involve people they don’t see as part of
their moral community,” writes Eric Uslaner, a professor of
government and politics at the University of Maryland, College
Park.
So people high on the particularized-trust scale would be more
likely to believe information that comes from others in their
groups, and if those groups are ideological, the people sharing
that information probably already agree with them. And so it
spirals.
This is also a big part of why people don’t trust the media. Not
that news articles are never biased, but a hypothetical perfectly
evenhanded piece of journalism, that fairly and neutrally
represented all sides would still likely be seen as biased by
people on each side. Because, Manjoo writes, everyone
thinks their side has the best evidence, and therefore if the
article were truly objective, it would have emphasized their side
more.
This is the attitude Trump has taken toward the media, calling
any unfavorable coverage of him—even if it’s true—“unfair”
and “fake news.” On the other hand, outlets that are biased in
his favor, like Fox and Friends and the pro-Trump conservative
blog The Gateway Pundit, Trump bills as “very honorable” and
he invites them to the White House. (This is a reversal of
fortune for Fox, which got a similar “fake news” style brush-off
in 2009, when Obama’s communications director said the
administration wouldn’t “legitimize them as a news
organization.”) Trump’s is an extreme, id-fueled version of
particularized trust, to be sure, but it’s akin to a mind-set many
are prone to. Objectivity is a valiant battle, but sometimes, a
losing one.
Alternative facts” is a phrase that will live in infamy. Trump
counselor Kellyanne Conway famously used it to describe White
House Press Secretary Sean Spicer’s lie that Trump’s

inauguration had drawn the “largest audience to ever witness an
inauguration—period.”
Spicer has also said to reporters, “I think sometimes we can
disagree with the facts.”
These are some of the more explicit statements from an
administration that shows in ways subtle and not-at-all subtle
that it often does not, as McIntyre would put it, “respect the
truth.” This sort of flippant disregard for objective reality is
deeply troubling, but the extreme nature of it also exposes more
clearly something that’s always been true about politics: that
sometimes when we argue about the facts, we’re not arguing
about the facts at all.
The experiment where Trump supporters were asked about the
inauguration photos is one example. In a paper on political
misperceptions, Nyhan suggests another: a survey asking people
whether they agree with the statement “The murder rate in the
United States is the highest it’s been in 45 years,” something
Trump often said on the campaign trail, as well as something
that’s not true. “Because the claim is false,” Nyhan writes, “the
most accurate response is to disagree. But what does it mean if
a person agrees with the statement?”
It becomes unclear whether the person really believes that the
false statement is true, or whether they’re using it as a shortcut
to express something else—their support for Trump regardless
of the validity of his claims, or just the fact that they feel
unsafe and they’re worried about crime. Though for the media
outlets that are fact-checking these things, it’s a matter of truth
and falsehood, for the ordinary person evaluating, adopting,
rejecting, or spreading false beliefs, that may not be what it’s
really about.
These are more often disputes over values, Kahan says, about
what kind of society people want and which group or politician
aligns with that. “Even if a fact is corrected, why is that going
to make a difference?” he asks. “That’s not why they were
supporting the person in the first place.”
So what would get someone to change their mind about a false

belief that is deeply tied to their identity?
“Probably nothing,” Tavris says. “I mean that seriously.”
But of course there are areas where facts can make a difference.
There are people who are just mistaken or who are motivated to
believe something false without treasuring the false belief like a
crown jewel.
“Personally my own theory is that there’s a slide that happens,”
McIntyre says. “This is why we need to teach critical thinking,
and this is why we need to push back against false beliefs,
because there are some people who are still redeemable, who
haven’t made that full slide into denialism yet. I think once
they’ve hit denial, they’re too far gone and there’s not a lot you
can do to save them.”
There are small things that could help. One recent
study suggests that people can be “inoculated” against
misinformation. For example, in the study, a message about the
overwhelming scientific consensus on climate change included a
warning that “some politically motivated groups use misleading
tactics to try to convince the public that there is a lot of
disagreement among scientists.” Exposing people to the fact
that this misinformation is out there should make them more
resistant to it if they encounter it later. And in the study at
least, it worked.
While there’s no erasing humans’ tribal tendencies, muddying
the waters of partisanship could make people more open to
changing their minds. “We know people are less biased if they
see that policies are supported by a mix of people from each
party,” Jerit says. “It doesn’t seem like that’s very l ikely to
happen in this contemporary period, but even to the extent that
they see within party disagreement, I think that is meaningful.
Anything that's breaking this pattern where you see these two
parties acting as homogeneous blocks, there’s evidence that
motivated reasoning decreases in these contexts.”
It’s also possible to at least imagine a media environment that’s
less hospitable to fake news and selective exposure than our
current one, which relies so heavily on people’s social -media

networks.
I asked Manjoo what a less fake-newsy media environment
might look like.
“I think we need to get to an information environment where
sharing is slowed down,” Manjoo says. “A really good example
of this is Snapchat. Everything disappears after a day—you
can’t have some lingering thing that gets bigger and bigger.”
Facebook is apparently interested in copying some of
Snapchat’s features—including the disappearing messages. “I
think that would reduce virality, and then you could imagine
that would perhaps cut down on sharing false information,”
Manjoo says. But, he caveats: “Things must be particularly bad
if you’re looking at Snapchat for reasons of hope.”
So much of how people view the world has nothing to do with
facts. That doesn’t mean truth is doomed, or even that people
can’t change their minds. But what all this does seem to suggest
is that, no matter how strong the evidence is, there’s little
chance of it changing someone’s mind if they really don’t want
to believe what it says. They have to change their ow n.
As previously noted, Daniel Shaw ultimately left Siddha Yoga.
But it took a long time. “Before that [New Yorker] article came
out,” he says, “I started to learn about what was going to be in
that article, and the minute I heard it is the minute I left that
group, because immediately it all clicked together. But it had
taken at least five years of this growing unease and doubt,
which I didn’t want to know about or face.”
It seems like if people are going to be open-minded, it’s more
likely to happen in group interactions. As Manjoo noted in his
book, when the U.S. government was trying to get people to eat
organ meat during World War II (you know, to save the good
stuff for our boys), researchers found that when housewives had
a group discussion about it, rather than just listening to a
nutritionist blather on about what a good idea it was, they were
five times more likely to actually cook up some organs. And
groups are usually better at coming up with the correct answers
to reasoning tasks than individuals are.

Of course, the wisdom of groups is probably diminished if
everyone in a group already agrees with each other.
“One real advantage of group reasoning is that you get critical
feedback,” McIntyre says. “If you’re in a silo, you don’t get
critical feedback, you just get applause.”
But if the changes are going to happen at all, it’ll have to be
“on a person-to-person level,” Shaw says.
He tells me about a patient of his, whose family is involved in
“an extremely fundamentalist Christian group. [The patient] has
come to see a lot of problems with the ideology and maintains a
relationship with his family in which he tries to discuss in a
loving and compassionate way some of these issues,” Shaw
says. “He is patient and persistent, and he chips away, and he
may succeed eventually.”
“But are they going to listen to a [news] feature about why
they’re wrong? I don’t think so.”
When someone does change their mind, it will probably be more
like the slow creep of Shaw’s disillusionment with his guru. He
left “the way most people do: Sort of like death by a thousand
cuts.”
Beck, Julie. “This Article Won’t Change Your Mind.” The
Atlantic. 13 March 2017, https://www.theatlantic.com/
science/archive/2017/03/this-article-wont-change-your-
mind/519093/.

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