10/10/2012 01:42 pm ET Updated Dec 10, 2012

Observations Concerning Distinguishing Facts, Opinions, Lies, and Distortions

In this comment my definition of "fact" is something that has actual existence or is part of objective reality. "Opinion" is a personal view or judgment. "Lie" is a knowingly untrue assertion made with the intent to deceive. "Distortion" is a deceptive twisting of fact.

It seems increasingly difficult to distinguish between facts, opinions, lies, and distortions in the business, political and social world. In part, this is because of the increasing complexity of knowledge. In part, it is because there are multiple sources of information available. Finally, social and psychological research helps one understand our inherent intellectual limitations.

It has been asserted that no one understood financial derivatives. They were too complex. Does anyone truly know with certainty the future? No, but many assert various coming events with certainty. So a preliminary understanding is that the business world is more complicated than "buy low, sell high" and the political and social world is more complicated than a five second sound bite. In distinguishing facts, opinions, lies, and distortions one must beware of simple formulas and quickly stated generalizations.

A second difficulty is the paradox that with more sources of information it is increasingly difficult to thoroughly examine and evaluate these sources. For example, technology tools may be used to alter photos, video, audio and documents. What are the belief systems of informants that consciously or unconsciously influence communications? What financial or political interest in a particular outcome does an informant have? What is the current psychological or emotional state of the informant? Does the informant know the difference between "facts" and "opinion," assuming the speaker knows if an assertion is a lie? These same questions may be asked of the recipient of the information. What individual has the time and resources to conduct an investigation into the sources of information? Traditionally we rely upon trusted "experts" or the "news media." Unfortunately, we increasingly know that these sources also may have agendas and are not without bias. Classic affinity fraud relies upon deceiving trusted opinion leaders who in turn unknowingly spread lies.

The third difficulty lies within each of us. Genetics, environmental influences, and group memberships are increasingly understood to shape our worldview. A worldview, once established, is difficult to change and colors our interpretation of events. Consequently two individuals may draw opposing conclusions from the same information. Consider the frequent reaction of cult members who rationalize or explain failed predictions. We all carry psychological filters that may influence what we perceive.

Distortions have a core truth but the presentation is designed to favor a particular viewpoint. For example, if one begins with $1.00 and currently has $2.00 that might be presented as a 100 percent increase, a $1.00 increase, a huge increase (in percentage terms), or a small increase (in constant dollars). If the increase occurred over fifty years, for example, is the presentation made in constant dollars or inflation adjusted dollars? If shown on a graph, how does the scale used change the appearance of the graph? These are just a few examples among many of presenting truth in a manner that favors a particular viewpoint.

What must one remember in the quest to distinguish facts, opinions, lies, and distortions? Clearly humility is appropriate. Certainty is illusive. One must be open to hearing opposing views. Secondly, one must understand that it is easy but dangerous to take shortcuts in deferring to the statements and analysis of others. Thirdly, one needs to be conscious of the typical tools of manipulation that are employed in a "media savvy" world. Finally, and this list could be expanded, one must acknowledge the large role of trust in all interactions and the destructive impact on our business, political and social world when trust is knowingly violated. Integrity is truly the interpersonal glue of all societies.

Are we able to distinguish facts, opinions, lies, and distortions? We hope so, but the process is much more difficult than we might suppose. In order to have a functioning business, political and social world, we must try to make these distinctions.

There is a real danger to society when factual information is intentionally manipulated for tactical gains. Mixing-up fact, opinion, lies, and distortions may seem to be a short-term path to business or political success, but in the long term the informational system will collapse. If individuals distrust sources and are unable to distinguish between accurate and distorted information then any dialogue based upon fact is impossible. Many historical accounts point to the importance of all parties in the communication process distinguishing facts, opinions, lies, and distortions. Let us hope that integrity in presenting information does not vanish and additionally that we have the wisdom to select reliable and undistorted sources of information.