Skin in the Game

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The term having “skin in the game” is quite versatile and is used in business, finance, politics, sports, and of course the gaming industry. The message it delivers is quite clear, namely that someone is making a commitment to something and is putting up something of value to solidify that commitment. If taken literally, one might conjure up thoughts of barbarism, but in proving the accuracy of the phrase, there would be little chance of finding anyone willing to give up on something so quickly if they had their own skin literally at stake. Encyclopedic references are unable to determine the origin of the term however; it is used quite widely in business and often, but erroneously, attributed to famed investor, Warren Buffet.

Another euphemistic variation of the term is “pound of flesh,” the origin of which is often attributed to William Shakespeare and relates to a possible consequence should one with skin in the game find himself on the short side of the ledger. As any non-native English speaker would attest, the English language is wrought with complexities weighted with cultural and regional influences, and these continue to evolve in lock step with American cultural changes. Examples are found in the range of accents one would encounter from people in areas like Brooklyn, NY, or Boston, MA, or Chicago, IL or Charleston, SC, or New Orleans, LA. Words and phrases spoken in those regions not only sound different, but could very well have different meanings altogether.

The dictionary defines words as units of language; a principal carrier of meaning. When someone uses the phrase he has skin in the game, in today’s culture he is communicating seriousness or perhaps even a sense of bravado towards the issue at hand, and he is not to be taken lightly. A web search of the phrase results in approximately 17,000,000 instances.

If one were to examine the second noun in the phrase he might wonder what game is being referenced. This would infer the existence of a situation where there would be a winner or a loser; a profit or a loss; or a success or a failure as an outcome. The item at stake of course would be something of value; theoretically, one’s skin. With the millions of instances of the phrase being referenced worldwide, its meaning should be understood fairly consistently across cultural and regional boundaries.

Other examples of the phrase deserving consideration would be one’s emotional investment in a relationship. It could be successfully argued that a person’s emotions towards their spouse would be considered the skin while the marriage is equated with the game. An airline pilot has his skin in the game to safely land the plane whereas the pilot of a drone aircraft would have no skin in the game. Politicians confront skin-in-the-game situations on a regular basis. They must faithfully represent their constituents or suffer the loss of credibility, political capital, and possibly their chances of being re-elected.

Speech and the manner in which people express themselves are always changing and people are always looking for ways to improve communication; to be better understood. To say that one has skin in the game conveys what may often be a very complex message while using the fewest words.

By Mark Politi

New York Times
Securities and Exchange Commission

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