"So, how does this hoax work, anyway?"

[Hektor]

I want to take some time here to review some of the literature in the field of hoaxes, lying and group consensus.

Good idea. I probably should have included more "theory" in the OP. I'll add a link to your post. There's a lot of relevant literature in a number of fields.

A classic text would be Thomas Kuhn's The Structure of Scientific Revolutions. Kuhn was a philosopher of science. The old quip "science advances one funeral at a time" captures the main idea. The ideal of science is steady progress based on dispassionate consideration of evidence. In practice, it seems there's a lot of friction due to big egos and other human factors. Major changes/advances require "paradigm shifts" which are difficult for people to accept. Kuhn was specifically interested in hard science, but the same principles apply even more strongly to more politically charged topics.

In psychology, there is a large literature on cognitive biases and related concepts.

• Motivated reasoning
• Confirmation bias
• Belief perseverance
• Cognitive dissonance
• Overconfidence effect

Social psychology considers is more focused on group interaction.

Pluralistic ignorance - where an individual privately disbelieves something but publicly goes along with something because they assume (falsely) that everyone else believes

Sociological models of belief, as we would expect, focus on group dynamics. ...

Kuhn, who was Jewish was also influenced by Ludwik Fleck in his thinking. Fleck developed the idea of thought collectives. Meaning that there are social networks in academia that entertain similar thoughts or belief systems. This can also lead to fallacious reasoning. Ludwig Fleck was a concentration camp inmate who also researched on Typhus and its prevention inside the concentration camps.

The idea is however as old as the scientific method itself. Francis Bacon did already point to "idols of the mind" in his Novum Organon. They dictate the reasoning of those affected and lead to wrong conclusions all the time. It's always funny, when folks that claim to be enlightened, emancipated and rational fall for those idols and biases. And you can't win with them. They always find "reasons" for why they are right on a subject. I mean Holocaust Revisionists get those types of rhetorical devices posing as arguments thrown their way all the time. "Where did they go, if they weren't gassed?". "Do all witnesses lie?" - "Are you saying there is a grand conspiracy that decided to lie about concentration camps?".

Quite elaborate work all to sail around the evidence that should be there, if the Holocaust Narrative was true.

[Archie]

This story is well-known, but the details of it are pretty interesting. The TLDR is that Holmes managed to raise billions of dollars for her blood testing startup by pretending to have breakthrough proprietary tech that she didn't have. The pitch was that Theranos had found a way to do hundreds of blood tests from just a drop of blood. She got money from Silicon Valley and used the hype to cut deals with Walgreens and Safeway. She then used those deals to raise more money. She recruited many notable people to serve on the board.

In July 2011, Holmes was introduced to former U.S. Secretary of State George Shultz, who joined the Theranos board of directors that month.[134] Over the next three years, Shultz helped to introduce almost all the outside directors on the "all-star board", which included William Perry (former U.S. Secretary of Defense), Henry Kissinger (former U.S. Secretary of State), Sam Nunn (former U.S. Senator), Bill Frist (former U.S. Senator, senate majority leader and heart-transplant surgeon), Gary Roughead (Admiral, USN, retired), Jim Mattis (General, USMC), Richard Kovacevich (former Wells Fargo Chairman and CEO) and Riley P. Bechtel (chairman of the board and former CEO at Bechtel Group).[134][135][136]

https://en.wikipedia.org/wiki/Theranos

In retrospect, it seems incredible that so many people fell for this. This particular scam was doomed from the beginning since you can only get by for so long by promising things without actually having a product. And in medical services where you have agreements to deliver actual blood tests, it's going to become apparent if you can't do what you say. It still went on for much longer than it ever should have.

A few lessons stand out to me.

-If people like a particular narrative and want to believe, they will. In this case, they wanted to believe in Holmes as the first female superstar CEO in Silicon Valley. The "female Steve Jobs." They wanted to believe she had really revolutionized medicine.
-Some lies are so brazen that it is hard for people to accept that they could be lies. It was hard for the Walgreens execs to believe that a company that seemed so credible could be an outright fraud.
-Quite a few people were onto Theranos or had suspicions, but they could get anywhere. The company used legal threats and NDAs to keep former employees quiet. This is something people don't seem to understand. They think things just fall apart the second anybody comes forward, but that's not how things work. Often people come forward and get crushed and nothing else happens.

https://statmodeling.stat.columbia.edu/ ... y-startup/