High vs. Low Stakes: idioms describing risk

Wooden stakes 

High vs. Low Stakes: idioms describing risk

Many decisions can involve some risk, especially in business. Making the wrong decision can be very costly and even lead to complete failure. Other decisions have less serious or inconsequential levels of risk. In other words, decisions can have high levels of risk or virtually no risk at all. Deciding what shirt to wear in the morning has little risk for me, while deciding where to invest my retirement savings could have disastrous results.

Inconsequential decisions are often called “low stakes” situations because what happens does not matter very much. Wearing my blue shirt instead of my gray one will likely make no difference. “High stakes” situations include college admission tests, dating and marriage, job interviews, etc. You have a lot to gain or lose at critical points. Casinos try to attract “high stakes” gamblers who will bet a lot of money. For corporate boards, selecting a CEO is a process that is often critical. Because the potential risk is so high, the board is “playing for high stakes.” Here in Silicon Valley, a lot of venture capitalists compete for high stakes, such as funding the next Apple or Google.

So what is a “stake” exactly? Because of the spelling we know it isn’t for dinner (steak), even though the pronunciation is exactly the same. Please look this up because I am only offering my guess here, but the most common meaning of stake is a piece of wood that is sharpened on one end, to help stick the wood into the ground. For example, we use fence stakes to hold up fences. In the old days, people marked the corners of their property with wood stakes, so others would recognize the boundary. Even today, surveyors use wooden stakes to measure the land very precisely. Often the tops are sprayed orange or a colorful ribbon is tied around the top. If you camp, you probably have tent stakes to hold up your tent. Though originally made of wood, most tent stakes now are metal or plastic.

Stake supporting sapling

White settlers pushed west after 1865. The Homestead Act signed at the end of the Civil War encouraged western expansion by giving land for free to anyone who would go live there and put the land to use for seven years. Free land was a big incentive, and the settlers used wood stakes to mark out their land claims. Quickly, “staking a claim” meant asserting ownership over a piece of land, and eventually anything else. During many gold rushes in the west, each miner established his area by staking a claim, both literally and then figuratively, by registering with authorities. Before miners could travel west and stake their claim, they had to save or borrow a grubstake, so they could eat (grub=food) until they found gold.

Some mines grew very rich and attracted outside investors who often paid dearly for a small share, or stake, of a company. Initially, investors held only a “small stake” in the mine. By stock manipulation and other tactics they quickly grew their investments until they gained control. These days, people who own corporate stock are called stockholders, but we use “stakeholders” to indicate all those affected by group decisions. For example, all Americans are stakeholders in our democracy because how the government operates will affect us. Corporate employees who do not own stock are still stakeholders because their jobs are at stake.

To make a long story short, what started out as a piece of wood pointed on one end became a verb meaning “to claim,” and then evolved into a noun describing value (I wish I owned a big stake in Google!). Please post a comment or send me an email if you wish to correct or add anything. Accuracy is important to me because my reputation is at stake.