Category: Business

The new buccaneers

A curious piece, tongue-in-cheek, but neat, in a recent edition of The Economist.

‘Mr Johnson understood intuitively that the financial crisis had ended the neoliberal consensus…No mere Trumpian wrecking ball he is trying to reshape globalisation in the mould of Britain’s buccaneering maritime past, rather than in the European Union’s bureaucratic pettifoggery.’

Buccaneering. How do you ‘buccaneer’ these days?

Container ships could be the new buccaneers. Where once we had tea clippers and cargo ships. We’ll need a bit of the old aggression, against Chinese and indeed the Americans if we’re to capture markets, and of course against our old friends, the Europeans. Piracy would help. Conquest shouldn’t be ruled out.

Or if that’s beyond us, overseas markets will least welcome a bit of the old imperial chutzpah. It will be as if we’d never been away.

The EU’s ‘bureaucratic pettifoggery’. But isn’t it what successful free trade requires, a bit of pettifoggery? Small print. A few regulations, so we’re all on the same page. In olden times, we wrote our own. It was easier then. (Yes, regulations need to be reined it: it was always thus.)

You need the high seas and a big reach if you’re to buccaneer. But ‘big reach’, also known as globalisation, isn’t really that fashionable at the moment, beyond our shores. Buy American is the watchword over the pond. China is focusing more on its internal market, and on its Belt and Road for which there’s no equivalent here in the West. China on its doorstep bludgeons with overwhelming economic power. We negotiate as best we can.

We had our own strong internal market, just twenty miles away over the Channel, twenty-eight countries strong, but we gave it up, and put stop-gaps and confusion in its place. And hide our confusion with hyperbole.

Liz Truss’s article on the Politico website back in March is a fine example. A few quotes:

‘We will work together to reshape the rules of global trade to reflect our core values…The U.K.’s values-driven policy has already delivered successes in trade negotiations….Just as free trade made the U.K. great in the 19th century, we can be even greater still in the 21st by becoming a global hub for services and digital trade.’

We’re back to being … buccaneers. And nowadays the world’s awash with buccaneers. We could find ourselves with brief spells of comparative advantage, where we outperform our rivals, or corner a niche in the market, only to find we’re overtaken as other countries seek to build advantage for themselves in the same areas, which could be digital, medical or services. As a mature economy we specialise at the high end. As other economies mature, so will they.

Free trade in the highly fluid modern world can’t remotely be compared with the 19th century as a driver of community prosperity. That was built on certainty, and the confidence born of certainty, and it was even then a long, rocky, risky and highly uncertain road. Politics in the wrong hands deals in simplicities. History hits you hard with a reminder of just how extraordinarily complex is the reality.

Strong communities and long supply lines can be a poor mix, with little connection between businesses tucked away in business parks and nearby towns and villages. Community in its widest sense requires shorter, more guaranteed lines of supply, with industries which can sell strongly into local markets, or into UK-wide markets, or indeed into EU-wide markets. We need a different and wiser mindset, which focuses in developing our UK and European markets, and which, while promoting trade with China, Japan, India and the ASEAN countries, avoids obsession.

We’ve also had Johnson’s 15th July ‘levelling up’ speech.

‘We are turning this country into a science superpower, doubling public investment in R and D to £22 billion and we want to use that lead to trigger more private sector investment and to level up across the country so that we have hubs or research and innovation like the one we are in today which is actually driving battery technology.’

All this is admirable. But is this government competent to deliver? Have we any reason save their bluster to believe them? Our best hope lies in the local mayors of cities lie Manchester, Birmingham and Bristol, also Teesside. Labour and Tory – they do have the competence.

We simply have the wrong people in power to get close to addressing, let alone solving, the issues of our time. We’ve over the last twenty years seen the disappearance of men and women of calibre from our politics. Johnson has ensured that the old high-calibre politicians won’t touch his party. On the other side, Corbyn didn’t help. The way back isn’t proving easy.

A little bit of lobbying – revisited

(If you read my last post you might want to miss this. It is simply a shortened, and updated, version. Last time there was too much Adam Smith, however fascinating he might be.)

We have finally put austerity behind us. We’re no longer frightened of deficits, here or in the USA. $1.9 trillion is Biden’s rescue package, and then some. More than ever, in these times, we need financial probity. How government interacts with the private sector, in all its aspects, is a key issue for our time.

As a convenient reminder, we have the lobbying scandal involving Cameron and Greensill Capital. And in the last two days we learn that, in March last year, Boris Johnson was exchanging text messages with his friend and Tory supporter Sir James Dyson. We needed ventilators quickly, Sir James could provide, and Johnson promised (‘“I will fix it tomo!’) no negative tax implications for Dyson staff who came to the UK to help.

It was a time of crisis, Johnson argued in the House of Commons. That doesn’t excuse. It only exemplifies how government without proper supervision, of the kind exemplified by the government’s plans to reduce the scope of judicial review, can operate via back doors and personal contacts. Whether ‘cronyism’ is the appropriate word I’ll leave for the reader to judge.  

I’ll skip direct quotes from Adam Smith, but will include a pivotal quote from Jesse Norman’s book about Adam Smith: ‘Yet as technology spreads big data, insider knowledge, digital technologies, there are increasing dangers of a new tech-enabled crony capitalism: a self-reinforcing cycle in which greater insider power encourages the development of bent markets…’

What intrigues me is that Jesse Norman is a Tory MP and Financial Secretary to the Treasury, and like Cameron, an Old Etonian. He will, I trust, have been making his views on crony capitalism widely known.  (There was, quite co-incidentally, a curious spat between Cameron and Norman over House of Lords reform back in 2012.)

‘What me, guv?’ I imagined Cameron as saying. The game is so entrenched. Market forces as experienced by ordinary consumers are one thing.  Financial engineering and derivatives are another story. Begetters of boom and bust, and multiple shenanigans.

Greensill Capital, advocacy for which got Cameron into trouble, was a clever financial idea (I wondered about the term ‘ruse’) where business bills are settled immediately for a fee, assisting thereby with the issue of late payments.

Cameron, a humble politician earning a relative pittance, stood to make a lot of money. Big share options were on offer. I sense he simply got out of his depth. That’s the kindest thing one can say.

And finally (as I mentioned in my last post) …I was intrigued to see how the Daily Mail is trying to turn the lobbying scandal into a plot by Labour anti-Brexit insiders within the Civil Service trying to blacken the government. It goes with Palace ‘insiders’ telling us what really went at the Duke of Edinburgh’s funeral between Harry and Kate and Will.

As always with the Mail, don’t believe a word of it.

A little bit of lobbying on the side

Remember Philip Hammond desperately trying to balance the books as Chancellor? Now all the talk is of how foolish Osborne was to batten down for so long. And it looks as if Hammond wasted his time. Expansion and big rescue packages and capital spending are the order of the day. In the USA, the same. Biden’s $1.9 trillion rescue package. And big plans for infrastructure. The debate in the USA is whether it will cause inflation to get out of hand. The Economist is putting out dire warnings on the one hand – but supporting a big spending approach for the EU on the other.

How government interacts with the private sector will be more than ever in the spotlight. The lobbying scandal involving David Cameron and Greensill Capital is just one example of how this relationship can go wrong.

Adam Smith provides context. He tends to be associated, by way of a selective reading of The Wealth of Nations, with a freewheeling free-market philosophy. By which bad behaviours might be somehow balanced out by good. Not so, as his ‘The Theory of Moral Sentiments’ reveals. ‘It carries within it a crucial Smithean insight, that innumerable human interactions can yield vast but entirely unintended collective consequences – social benefits, yes, but also social evils…’ (Jesse Norman, ‘Adam Smith, What He Thought And Why It Matters’)

There is a good, and ‘Smithean’, argument to be made as follows. In a commercial society we are all merchants. The pursuit of wealth is of itself a good thing (depending on how ‘wealth’ is defined). The desire for human betterment drives that process. War and violence have, for all of history, brought about division. Commerce binds us together.

But over-accumulation, growth for its own sake, inequality, the pursuit of self-interest, the handing-on of wealth from one generation to the next – wealth for its own sake and not as the driver of a society’s welfare – they are among the great enemies. The fact that David Cameron’s activities were ‘legal’ exemplifies, all the more, how easily the pursuit of wealth as an ultimate social good can be corrupted.

Jesse Norman, who is incidentally an Old Etonian, and Tory MP (read into that what you may), has an intriguing paragraph in his biography of Adam Smith: ‘Yet as technology spreads big data, insider knowledge, digital technologies, there are increasing dangers of a new tech-enabled crony capitalism: a self-reinforcing cycle in which greater insider power encourages the development of bent markets; these in turn create popular demands for more government regulation, create more complexity and opportunity for lobbying, a further boost to the power of insiders, and so on.’

‘What me, guv?’ I can imagine Cameron as saying. The game is so entrenched. We’re, many of us, wary believers in market capitalism, where market forces ‘drive prices down and quality up, and consumers have a very wide choice’, in Norman’s words. We’re talking of food, clothes, everyday items.

Financial engineering and derivatives are another story. Begetters of boom and bust, and multiple shenanigans. (They were of course unknown to Adam Smith.) Greensill Capital, advocacy for which got Cameron into trouble, was a clever financial idea (I wondered about the term ‘ruse’) where business bills are settled immediately for a fee, assisting thereby with the issue of late payments.

Now, as much if not more than ever, with big money and big contracts in play, we have a whole new raft of opportunities for crony capitalism, re-working old business and school networks, rent-seeking, inside knowledge, and conflicts of interest. More than ever we need to be wary – to be aware.

Heading off at a slight tangent there’s a paragraph from an American author*, writing on the subject of meritocracy, I’d like to quote: ‘Someone who wants an elite income … must do one of a narrowly constricted category of jobs, heavily concentrated in finance, management, law and medicine.’ Teaching, public service, ‘even engineering’ don’t get a look in. (How medicine and money came to be quite so conflated is a uniquely American story.)

Cameron, a humble politician earning a relative pittance, wanted to be part of that big-earning brigade, with big stock options on offer.

Many had a high regard for Cameron. He will be wondering how he surrendered it so easily.  

And finally …I’m intrigued to see how the Daily Mail is trying to turn the lobbying scandal into a plot by Labour anti-Brexit insiders within the Civil Service trying to blacken the government. It goes with Palace ‘insiders’ telling us what really went at the funeral between Harry and Kate and Will.

Don’t believe a word of it.

*Daniel Markovits, ‘The Meritocracy Trap’, quoted by Stefan Collini in the London Review of Books)

Fog and politics

A single bird was in unusual and glorious voice in thick fog at the top of the Common this early morning.  It’s the first day of February. I slowed my run, and listened. As if to a nightingale in the silence. Also this morning a coup in Myanmar, and by lunchtime indications that the South African version of the virus has touched down in the UK. We’ve incipient vaccine wars with the EU, who I want to support, but who’ve made fools of themselves, turning on Astra-Zeneca, and threatening UK supplies.

Back home, after breakfast I take refuge from all that’s happening and about to happen by putting, with my partner, Hazel, a few more pieces into our 1000-piece jigsaw. Jigsaws like early-morning runs (pilates for Hazel) can be surprisingly therapeutic.

I needed a little therapy. It’s a morning when the news gets you down. Might the answer be to walk away from it all? Does politics, as a discussion in the current edition of Prospect, has it, really matter? Academic Freya Johnston is pitched against old-school politician, Malcolm Rifkind.

Politics for Johnston is inseparable from the public dislike of politicians. ‘One reason that polls demonstrate indifference to politics is the public contempt for politicians.’ Rifkind accepts, as I do, that ‘normal people are more interested in their own well-being than by what happens on the national stage’. But on the plus side he quotes the vision of the politicians behind the launch of the NHS. Johnston ripostes that ‘rather, it responded to increasing social and cultural pressures’. Politics is of course the interplay between the two, politicians and public. Aneurin Bevan, who championed the NHS in parliament, was a good guy, and a hero. (We do need more like him.)

The exchange was depressing, with both sides reduced to quoting Jane Austen. Johnston needs reminding we are in a world of stark dualities, good and evil, compassion and cruelty, and, yes, liberal democracy and various forms of often brutal autocracy (and Trumpian shades inbetween). We can take nothing for granted. Public opinion does need to engage, whether it likes it or not.

Both the Economist (23rd January) and TLS (8th January) have featured a new book, ‘Out of the Ordinary’, by Marc Stears, which doesn’t shy away from voters’ disdain for politics and politicians. On the one hand we’ve the ‘technocrats’ of the Blair/Cameron era, on the other the ‘ideologues’ and zealotry of the Labour left. In both cases it’s ‘direction by others’. (Brexit has landed us instead with the zealotry of the Tory right, and their market obsessions.)

Stears argues for another approach, ‘the politics of the ordinary’. He likes the JB Priestley of ‘English Journey’. Nothing sentimental. Ditto George Orwell. We’re reminded of the Orwell aphorism that ‘to see what is in front of one’s nose needs a constant struggle’. Community engagement is fundamental to the picture, but I’d argue it’s not enough. Nor is the top-down, vote-buying capital investment the Tories talk about.

A genuine change of direction won’t come about by asserting that good sense and communitarian spirit will somehow win out in the end. But it would be helped by connecting ordinary folk, the you and me, and the next road, and the estate beyond the main road, with the economic and business as well as the social life of a community.

It would require a revival of a style of local government and local engagement that underpinned our politics until quite recent times. It would also involve short as well as long supply lines. Local suppliers employing local people to provide goods produced at a local level, alongside local services. Creating a landscape, a literal landscape, of SMEs – small and medium-sized enterprises, with government money supporting local business in a way people can connect to.  

It’s a direction of travel, not an easy answer. And it doesn’t discount the need for political and economic expertise, elites if you will. But it does require, and here I’m with Stears, that elites aren’t self-referential and self-serving, that they’re always connected, and don’t automatically renew.

I’m not arguing we turn our backs of the global world, or that we shouldn’t trade with Japan or South Korea or even China, but we do need a fundamental shift in the balance.

In this context I can’t let Freya Johnson get away with her ridiculous statement that ‘indifference [to the business of government] isn’t necessarily something to be lamented. It might even be strength’.

A few old-style ‘tribunes of the people’ might help. Marcus Rashford as he might be in a few years time. Trade unionists, remember Ernie Bevin and Jim Callaghan, brought hard experience from street and factory floor to government. It’s not so easy these days, but it’s that kind of connection from the street level via councils and other assemblies right up to parliament and the Cabinet that we need. I’m not against the occasional toff – we just need to mix them up with a few folk who’ve cut their teeth at a local level, and can bring a certain street-fighting capability to the business of government.

The obfuscations of 24-hour news, the miseries of Murdoch and Fox Media, the oddities of the Daily Mail – we have to do better. We thought the half-truths of social media were bad enough. Then came alternative truths, with conspiracy theories hot on their heels. We need an entirely different route, and disengagement Freya-Johnston-style from the process would be utterly foolish.

She’s an easy target, Freya Johnston, and I should dwell on her. Best to end by repeating that Orwell aphorism, ‘to see what is in front of one’s nose needs a constant struggle’.

Mill country – from Hebden Bridge to Stroud

[The first paragraphs of this blog originally appeared as the blog, ‘One cheer for enterprise and two for poor’. I’d taken my cue from EM Forster’s short book from 1950, Two Cheers for Democracy. I’ve decided rather late that both title and allusion are too obscure – but there still is a story to tell.]

Back in 1907 there was a creditors’ meeting in Manchester. A low-key winding-up. Not such an unusual occurrence. In this case it was ‘Mr Joseph Spencer, carrying on business… as tailor and outfitter’. He was my great-grandfather.

You saw an opportunity, you seized it, ‘set up shop’, a mill maybe – or literally a shop. That’s what Joseph Spencer did, in Hebden Bridge in Upper Calderdale, that hybrid seriously-Yorkshire but edging-Lancashire area which, with the Rochdale Canal sneaking through the Pennines, linked to Manchester as much as Halifax, and manufactured cotton goods (especially fustian) which traded on the Manchester Exchange.

In the 1890s he looked west, across the border, and opened further shops in Burnley, Accrington and Oldham, and in 1901 transferred his main business to Deansgate Arcade in Manchester. His son, my grandfather, Thomas, aged 22, stayed behind to run the Hebden Bridge business.

I will need to research further whether Joseph simply over-traded and ran out of money, or whether there was a wider slump. Either way, it’s in the nature of enterprise. Our lives run on enterprise, our own, or that of others. Small traders live on the edge, big businesses ossify. Get taken over, or in extremis, they collapse. Shipbuilding and steel. Coal. BHS, Arcadia, Debenhams.

My house in Stroud, in Gloucestershire, is next to the old Severn-Thames canal. An abundance of Cotswold wool, fast-flowing rivers in the ‘five valleys’ and, later, coal brought up the Severn, drove a multitude of mills, many of which, re-purposed, still survive.  It seems I can’t escape from mills, though it was wool in Stroud, and cotton (and especially fustian) in Hebden Bridge.

Across the canal from my house a mill turned out military uniforms, and a few yards to the west two mills co-existed with the railway viaduct which sweeps over both the canal and the river Frome. To the north, up on the hill, was the workhouse, a substantial structure, an ever-present reminder of how the wheel of fortune goes up, and also comes down.

It’s a peaceful landscape now. As indeed is Hebden Bridge. Both places, as I’m finding, have remarkable stories to tell. Once upon a time they were all energy, and noise, the endless working out of success and failure. All has leaked away downriver. (In Hebden Bridge’s case with an occasional big flood. The Frome in Stroud runs a deeper channel.) Downriver – and overseas.

There are many remarkable personal stories to tell. My great-grandfather’s being one. He was fortunate. He wasn’t brought low by his bankruptcy. But it’s a useful reminder to me (if Covid wasn’t enough!) how fickle fortune can be.

Hard truths about a hard Brexit

I’m helping making marmalade at the moment. Messy but satisfying. An early New Year diversion from Covid-19 and the Brexit-induced mess of our politics.

We’ve left, and Zenpolitics needs to put a marker down. This blog has been going eleven years, and it can’t let the Brexit Agreement pass without comment.

As a first and most basic proposition, we will achieve far more if we have the widest perspective – as citizens of Britain, of Europe and of the world. The one naturally folding into the other. We are foolish to think otherwise. Recent events represent a closing-in not an opening-out of our society, whatever the absurd and grandiose claims of the Johnson government.

Our Brexit divisions have often been compared to fractured personal relationships, where the only hope of coming together lies in attempting some understanding of the other side’s position.

I go along with that. It is after all what Zenpolitics espouses. But it’s hard when you’re dealing with a series of false promises, a disregard as it suits for truth and precedent. Michael Gove has expressed the hope that the agreement will see politics move away from the bitterness surrounding the 2016 referendum. He and his like fed that bitterness to serve their own ends. We are a polarised society, and that is unlikely to change.

Looking across the pond, we see Republican senators still trying to undermine Biden’s election – with no chance of success but taking what they see as a longer-term perspective – hanging in with the hard-line Trump agenda, however divisive the consequences. Brexit has bred a similar though less extreme cynicism. But the direction of travel is the same.

Johnson talks of friends in Europe, when insulting and misrepresenting them has been his trademark over twenty years.  There will be no easy coming together. Insofar as it happens it will be the pro-Europeans, who will never give up on working closely with old allies, who will be responsible.

Pro-Europeans will never abandon their position or their loyalties. They – we – know where the future lies. There must, if we are to hold any position in the world, be a coming together again with Europe. We will need another, wiser government before this happens. Taking back control is an absurd slogan – Brexit is by definition a losing of control, a losing of influence, a diminution of status, a constriction of sovereignty.

Yes, we are off-shore Europeans. We haven’t been invaded, or lost wars. We’ve no sense of needing to escape from our past. Our links with Europe are born of sympathy, common culture, convenience – not of necessity. Many of us are, as de Gaulle reminded us, closer to USA and Commonwealth countries than other European countries. But that gave us the priceless benefit of being a bridge, which we can be no more. Brexit has exacerbated an ‘outsider’ instinct, which will serve us ill.

This isn’t to downplay the issues which pushed Brexit up the agenda. Immigration was perceived to be out of control. Between 2008 and 2019 the UK’s Polish population more than doubled. Cameron’s government consistently aspired to and failed to bring the numbers down, and that helped focus the issue further.

In previous decades the failings of Common Agricultural Policy dominated debate. It rewards scale, guarantees the supply of food, and holds down prices, but in market terms it’s highly inefficient. But food was abundant, and prices were low. So it wasn’t a key issue. It wouldn’t resonate with voters.

The Leave side looked elsewhere. Fishing, however small as a sector of our economy, became a totemic issue. ‘Metropolitan elites’ likewise. The EU ‘elite’ and the ‘metropolitan’ became merged in the public mind.

Leave attached itself to the innate social conservatism of the ordinary voter. The Tory party as the party of Leave has been the big beneficiary. Opposition to overtly ‘woke’ behaviour has become a rallying cry in the popular press. Likewise, four years on from the Brexit vote, opposition, not always covert, to Black Lives Matter.

The likes of Douglas Murray stir the waters with articles in The Spectator and elsewhere. AN Wilson sounds off in The Times against the Archbishop of Canterbury. Johnson would rather be above all this but, being one for whom popularity is the ultimate aim, he will bend before the party wind as much as he needs to.

There’s always that sense we’re governed for the benefit of party, to ensure the Tory Party retain its role as the natural party of government. That’s an old accusation, party before country, but it rings true.

Jeremy Corbin and Militant Labour lent a big helping hand. For the Tories to sustain their northern vote through to and, they hope, beyond the next election a big south-to-north transfer of funds will be required. We thought we were dealing with a party which believes in hands-off government. All the more so since free marketeers staged their internal coup (and radically reduced the Tory talent base at the same time). And yet – we now have free marketeers becoming big-state spenders. They’re the ones in cabinet. The true diehards remain on the fringes.

The government’s language is palpably foolish. They talk of Global Britain. The country has ‘changed beyond all recognition’.  It now has ‘global perspectives’. There’s a notion spread about that the EU is somehow inward-looking. Yes, in the sense that it is more stubborn and hard-nosed, as Brexit negotiations have demonstrated. It has to be, in a world where the real battleground is between the three great economic power blocks, the USA, China – and the EU.

Both sides of the Brexit debate trade statistics on the relative performance of the UK as opposed to the wider EU economy. The hard truth is, to quote The Economist, ‘Britain’s recent performance has been poor, and Brexit will be a further drag on growth.’  Taking the most recent statistics from the House of Commons Library, ‘compared with the same quarter a year before (that is, Q3 2019) [UK] GDP was -9.6%. In the Eurozone it was -4.3% and in the US it was -2.9%.’

The current edition of The Economist further underscores the hard realities: ‘Since 2005 British firms’ share of world market capitalisation has fallen from over 7% to 3%, a much greater slippage than any other large European economy. Over the same period the share of the stock of global cross-border investment attributable to British-headquartered multinationals has fallen from 10% to 6%, also a bigger drop than for any other major economy.’

It is indeed curious how a government so committed to ‘free trade’, so focused in their aspirations on our future economic performance,  should have allowed ‘sovereignty’ and the 0.1% of our economy that is the contribution of the fishing industry to be the make-or-break issues in the final months of the Brexit negotiations. The multitude of new restrictions we now face as a result of leaving the Customs Union and the Single Market were treated as secondary considerations. For a brief summary of (some of) what we face see below.*

Services, including the financial sector, along with foreign policy and defence, are not part of the agreement just concluded. In great part the Brexit deal is defined by what is leaves out.

We won’t get better deals than we got under the EU. Brexiteers thought to court China. But investment in China is now the subject of close scrutiny. The EU has, as of last week, confirmed a China trade deal after seven years of negotiation. The best we can hope to get is a mirror image. That said, China has a long memory of Britain’s arrogance in our 19th century China dealings. Hong Kong doesn’t help. And China is happily wreaking vengeance on Australia for being the first to demand an independent investigation into the origins of the coronavirus epidemic.

We also have a weakling foreign secretary.

That touches on another big issue. We have a weak government of Brexit conformists, with free market attitudes which do not connect to the realities of our times, and abilities which fall well short of the abilities their briefs require. Raab, Truss and Patel were key figures behind the 2012 book Britannia Unchained. ‘The British are among the worst idlers in the world,’ is one quote I remember. Their subservience to Cummings told its own story.

Along with ‘Global Britain’ we have a ‘brave new future’. There’s something pathetic in these rallying calls. We’ve seen them all through Covid. Big statements and then they row-back, change tack, always positioning themselves behind the curve. (This should be a case study for future students of politics.)

We’ve had a defence review where hard decisions are helped by a big expenditure splurge. We will shortly have a much-delayed foreign policy ‘integrated review’. We will have to see what it says. We do of course have a permanent seat on the UN Security Council. We’re the second biggest contributors to NATO.  We have language on our side. But match that against a big reduction in the esteem in which we, and our democracy, a direct consequence of Brexit shenanigans, are held around the world. False pride is a biblical term that comes to mind.

Students of British politics in Europe, the USA and elsewhere will also be wondering about Scottish independence, and the likelihood of a united Ireland. The Johnson government is blind to what might well be realities, and further bitter divisions.

One lesson of history is that events never deliver on expectations. And the more radical the disturbance to the status quo the more disruptive the outcome. (Disruption was of course Cumming’s avowed aim). Brexit supporters back in 2016 thought we’d get a soft Brexit. A hard Brexit was for the extremists. And what do we have?

Another lesson is that you achieve by coming together, and not by splitting apart. A third would be that you don’t define your nation and your economy on the basis of its past achievements. We didn’t win 20th century wars on our own. We dispensed with Empire long ago, and we need to dispense with hangover imperial attitudes and sensitivities. We built our 19th century economy on cheap labour and captive markets. India had no choice but to buy our cotton manufactures. We don’t have those advantages now.

The sub-continent and Asian ‘tiger’ economies got their own back in the end. We have our expertise in specific sectors, defence, aviation, high tech, chemicals. But old Ricardian notions of comparative advantage mean very little these days. Tiger economies have shown how readily they can find investment funding, and how quickly they can overtake us in areas where we thought our advantage was well set.

Trade with our biggest partner is, by a vast margin, our best guarantee of future prosperity. At the same time we need to retain a healthy degree of cynicism. The idealism of the early years of the Common Market, when aspiration and market realities readily matched, is long gone. As a major driver of reform we have done the EU a disservice by leaving. That is, ironically, another reason for wanting to remain.

We won’t of course be rejoining in a hurry. But as and when, and if, we do, the EU in all probability is some shape or form will still be there. Many Brexiteers anticipated a wider fragmentation, precipitated by our departure. They have already been proved very wrong.

We have cast ourselves as outsiders, and it’s not a good place to be.

______________________________________________________________________________________________________________

*Quoted from an article by Charles Grant, director of the Centre for European Reform:

‘Most British people have no idea how hard Brexit will be…

Manufacturers and farmers will face irksome checks at borders for things like customs, VAT, safety and security, plant and animal health, and much else. Services companies will lose access to the single market unless they set up subsidiaries within it. British airlines and freight firms will no longer be able to operate freely within the EU. Citizens will lose the right to travel for as long as they wish, work, study or reside in the EU. Industries and institutions that have become accustomed to employing EU citizens – including farming, food processing, hospitality, care homes, construction and universities – will face difficulties. Britain is leaving a plethora of EU agencies, such as those that deal with medicines, chemicals, air safety and food safety. The British police will lose direct access to many EU criminal databases.’

Not all news is political…

Writing a blog can be a little like penning an article for a newspaper. Only it isn’t. You don’t have editors, querying content, or facts, or insisting on cuts, or rubbishing it altogether – denying your piece its ‘nihil obstat’ (as the Catholic Church would have it), ‘there is no objection.’

I’ve been my own editor in this case. I’ve objected and made changes. My original blog, ‘The very great and the very small’, is no more. If you did read that blog you’ll see I’ve re-worked the material, and put it into a different context.

I often put aside articles or news items that in some way or another hit home. It could be snippet or a long article in a periodical. They’re discussion points. I sometimes imagine myself in a college senior common room, chatting to specialists from a wide range of disciplines, non-specialist engaging with specialist. It could be Eng Lit meets astrophysics, microbiologist meets political scientist, or …

They get on to today’s news.

Politics… version one of this blog referred to the government’s £275m Culture Recovery Fund, and the £784,000 that’s been awarded to Cheltenham Festivals, which include science, jazz, classical music, and of course books.  As a regular visitor to Cheltenham’s remarkable festivals this is good news. I also mentioned, as a stark contrast, a Liverpool publican and his worries about his business’s future if Liverpool suffers a level three, almost total, lockdown for any length of time.

But that didn’t begin to do the subject justice, encompassing as it does local or national lockdowns, ‘circuit breakers’ – or avoiding lockdowns altogether, with at-risk groups self-isolating on a voluntary basis. Over in France Macron is bringing in curfews.

At which point a voice might say – no politics. Likewise no religion, and certainly no sex or scandal…

So my grumble (anger?) about the way the term ‘creative destruction’ has been used during the pandemic – it will be under-performing and less successful businesses which will go to wall, so we shouldn’t worry too much – would be not be allowed.

We move on to another subject.

Astrophysics… we have the Nobel Prize for Physics, awarded to three scientists for their work on black holes. There’s a black hole, Sagittarius A, is the very heart of our galaxy. It’s a mere four million times the mass of our sun, and it is of course invisible, because light can’t escape from it.

The first-ever image a black hole (outlined against the visible gases swirling around it) was released in April 2019. It’s at the centre of galaxy M87, which is a mere 53 million light years from earth. 53 million years for the light to reach us … roughly when the first primitive primates evolved, according to a New Scientist timeline of human evolution.

Chemistry … the Nobel Prize this year has been awarded to two scientists for their work on gene editing (editing ‘parts of the genome by removing, adding or altering sections of the DNA sequence’). Out of it could come new therapies for cancer, disease-resistant crops, ‘and which may, perhaps, end hereditary disease in human beings’.

Before we exult too much, we should remember that Covid-19 is not a hereditary disease. But human ingenuity, we hope and trust, will find a way.

History … another item I’ve recently put aside is a review by Christopher Clark of a new book on the Austrian stateman Metternich, which contains a quote from Napoleon, the simple brutality of which brought me up short. ‘You are no soldier,’ Napoleon said to Metternich, ‘and you do not know what goes on in the soul of a soldier. I was brought up in military camps, I know only the camps, and a man such as I does not give a fuck about the lives of a million men.’ (‘Fuck’ it seems is a fair translation.)

Contrast, lest we forget, what’s happening in Yemen, or on a smaller scale in Nagorna Karabakh. The simple, brute indifference to life. Or the 5.6 million Syrians are refugees, the 6.2 million displaced within Syria.

Are we getting political? Just where lies the divide? Migration and refugees are contentious subjects. And we’re back as if we hadn’t left them to refugees in the English Channel, to Brexit… to the American election, and the Mexican border fence.

If this is all part of a post-prandial conversation, then time, I think, for a coffee break.

How will they see us fifty years from now?

Impute a moral basis to society and you’re immediately on dangerous ground. If it’s hard to define morality in individuals how much harder is it to define morality in society. To keep the subject at a practical level I’m taking the UN declaration on human rights (see below) is a starting-point. But, as the issue of climate change exemplifies, it is only a starting-point. We have a responsibility to our own generations – but also to future generations.

American writer, Rebecca Solnit, in ‘Hope in the Dark’ (new edition 2016) asks ‘how human beings a half century or a century from now will view us … when climate change was recognised, and there was so much that could be done about it .. They may … see us as people who squandered their patrimony … regard us as people who rearranged the china when the house was on fire.’

She may be right, but new generations have always had the ability to adapt to their circumstances. Their world is the ‘new’ normal. Radicals will challenge it, as ever. And conservatives defend, as if the world had always been this way.

We must always beware complacency. Politics (not society as while) has over the last forty years lost its moral narrative. So many would argue. Some on the political right would counter that society shouldn’t have a moral narrative: the market, the free market, is the best determinant of human fortunes, and the state should interfere in only the most minimalist of ways. This also includes any attempt at world governance, so the United Nations and its various agencies, the WHO and the like, will always be suspect.

The Preamble to the UN’s Universal Declaration of Human Rights is a reminder of how moral purpose was defined in 1948 – and a marker against which we can judge our present society.

Whereas the peoples of the United Nations have in the Charter reaffirmed their faith in fundamental human rights, in the dignity and worth of the human person and in the equal rights of men and women and have determined to promote social progress and better standards of life in larger freedom, … Now, Therefore THE GENERAL ASSEMBLY proclaims THIS UNIVERSAL DECLARATION OF HUMAN RIGHTS as a common standard of achievement for all peoples and all nations

(NB The Preamble refers to ‘peoples’, not ‘nations’.)

Steven Pinker (psychologist, and author of ‘Enlightenment Now’, published in 2018) might not dissent, but he has an optimism which many of us wouldn’t share. He sees the progress in reducing inequality around the world (primarily in China and developing countries) as proof that moral purpose is still embedded in our society. Looked at in numerical terms there’s also been a massive reduction in violence (see ‘The Better Angels  of Our Nature’, published in 2011). This, he’d argue, is the working out of reason, the highest Enlightenment ideal.

There are powerful counter-arguments against both positions.  Inequality, and indeed poverty, and violence are still deep-woven into our society. Natural or man-induced calamities could have catastrophic consequences.

Reason, for Pinker, underpins progress and progress is essential, and sustainable. Take the environment as an example. He sees the damage done by carbon emissions, but the answer, he argues, is not to rail against consumption. Consumption is tied to many human goods, not least keeping cool in summer, and warm in winter. To quote from Andrew Anthony’s 2018 interview with Pinker in The Guardian, ‘how do we get the most human benefit with the least human damage’.

Pinker is right. We need, all of us, to take great care in lambasting consumption. Most people might well agree in principle, but demur when it affects them. We cannot avoid in society as currently constituted the kind of focus on science and technology, working in a capitalist context, that Pinker would advocate.

But how does Pinker imagine we got to where we are now? He rests too comfortably in the present. His argument for reason of necessity plays down the role the passions have played in driving social progress over the more than 250 years since the ‘Encyclopedie’ was published in 1750s France.

The old working class has to a great degree been ‘brought into the community – as voters, as citizens, as participants’. (See ‘Ill Fares The Land’, by the historian, Tony Judt, 2010) We didn’t get there simply by the exercise of reason. We avoided revolution, in Western Europe, but not by much. Post-war society addressed the five wants (squalor, want, ignorance, disease, and idleness) highlighted in 1942 by William Beveridge head on. But we’re now faced with what Judt described as ‘the social consequences of technological change’, as the nature of work changes radically. Judt was prescient. The historian, Peter Hennessy, has recently put forward five wants for a post-Covid times: solving social care, social housing, technical education, climate change, artificial intelligence.

Finding answers will require passion and moral purpose, and the application of enlightened and far-sighted ideas. Consumption will not get us there. (Though high levels of consumption are imperative if we’re to keep the economy firing at the level it will need to do if goals are to be met. High ideals, in the old phrase, butter no parsnips.)

Yes, capitalism will drive the foreseeable future as it has the recent past. (How it might be reconstituted is a whole other subject.) But it will challenged by, and ultimately will have no choice but to come to terms with, crises of inequality, population, resource exploitation and climate which could spell the world’s demise.

Pinker is not wrong: we have made progress in the context of human values and living conditions. But we are also radically dis-connecting from the natural world, changing permanently our ways of communicating, and our environment. We are heading into territory we don’t understand. We may or may not have the wherewithal to deal with this new dispensation when we get there. Dis-connect is high risk. Having the wherewithal doesn’t mean it will in any sense be a good place.

Science in this sense cannot be morally neutral. And does sometimes get on a roll, and head in directions which are high risk.  The theory of evolution took on a life of its own. The splitting of the atom opened a Pandora’s box we have no way of closing. Neuroscience and AI are working in tandem toward higher forms of intelligence which may yet radically change who we are as human beings. *

Rebecca Solnit imagined an observer in fifty tears time who is very much a replica of a typical individual in our own time. But we may be moving into very different spaces by that time.

Back to the UN Charter and its focus on ‘the dignity and worth of human person’. We vest in them specific meanings which we cannot take for granted.

—- —- —-

* The Economist, referring to academics who worry about existential risk, which could be super-eruptions, climate collapse, geomagnetic storms and the like, comments that they ‘frequently apply a time-agnostic version of utilitarianism which sees “humanity’s long-term potential” as something far grander than the lives of billions on Earth today: trillions and trillions of happy lives of equal worth lived over countless millennia to come’.   The Economist is referring specifically to Oxford’s Future of Humanity Institute.  We should indeed be engaged deeply  in such matters. But while doing so let’s never forget – the worth and the moral worth of each individual in the here and now has to be our starting-point.

We live fragile times …

Evening skies are, it seems, always clear these days. Even when the day turns cloudy and cold, and winds hit 40mph, by 8pm the sky is clearing, and Venus shines brilliantly, as it has since February. It will later this year shine brightly as a morning star, and return as an evening star in the autumn of 2021. We have the certainty of billions of years.

How marked the contrast with the fragility of our Covid times. None of us knows how the exit will work out. There are two fundamental directions – two well-defined attitudes. One, a re-set to where we were. There will be some big shake-outs, but we will revert to the old norms as we did after 2008. Old inequalities may be embedded even deeper. We will be in denial.

The other, an awareness of the fragility that our climate and health crises have highlighted, translated into a determination, in Europe and the USA at least, to re-set our priorities – with regard to conditions of work and taxation, and to the way we care for our planet, and moving beyond our respective health services to the way we care for each other.  (The USA in this regard has further to go than others.)

Nadia Whittome, at 23 the youngest MP in the House of Commons, is working weekends during the crisis in a care home. She recalls how, a couple of months ago, she ‘asked Priti Patel which aspect of social care she considered to be low skilled and she couldn’t tell me’. She thinks Patel’s response might be different now. ‘We’ve found out,’ Whittome continues,’ during this pandemic whom we couldn’t do without. It’s not the offshore companies, the hedge fund managers and the bankers; it’s the porters, the cleaners, the delivery drivers, care workers.’

This is the change of emphasis, more than emphasis – a change to fundamentals, we might hope to see. Though I’m not sure I share her optimism about Patel.

But we can’t do without growth. Without it we’ve no hope of financing the vast deficit we’re racking up, rising (according to a leaked Treasury document quoted in the Telegraph) from £55 billion before the pandemic to £337 billion. Extending the furlough scheme alone could be £80 billion on its own.

At the same time, growth on its own, without a re-set, will only polarise societies even further. ‘Agitation for more progressive and distributive policies’ will not go away. (Historian Walter Scheidel, quoted in The Guardian.)

There’s little sign that the government has any understanding of this. They’ve intervened in an extraordinary way, out of sheer necessity, but their instinct is and will be to free up market forces as soon as possible. Some Tory MPs are demanding that the government shouldn’t, post-crisis, be supporting unprofitable companies. I won’t critique this daft idea further other than to say that profit is too often a short-term measure, and a poor guide to the public utility, or longer-term success, of an enterprise. And what agency would be deputed to make these decisions?

This would be a different kind of shake-out for the one we might hope for. But it would fit well with the government’s Brexit agenda. As I’ve argued before, a post-Covid financial crisis will hide the economic debacle that’s likely to follow from a country operating post-Brexit under WTO rules.

Keir Starmer has declined to join the other parties in demanding a delay to the 31st December cut-off date for negotiations with the EU. I’m not sure he’s right on this – but it does mean he keeps his powder dry. Brexit is a high-risk card to play in any form for Labour. If, or when, talks collapse, and the government shows no signs of wanting to make the compromises a free trade deal with the EU will require, he will be in a stronger position.

His focus, as it was in the second (and largely unreported) part of his reply to Boris Johnson’s speech last Monday, has to be on creating a better society post-pandemic. One, as he put it, where we no longer under-invest in our public services – and yet expect front-line workers to protect us.

I don’t want this blog to be party political. First principles for me are compassion and enterprise, or enterprise and compassion, operating in tandem. But in the current climate I have no trust in the Conservatives, and I do have some hopes that the sheer common sense and decency of Starmer might yet deliver – exactly what, time will tell.

A society, and a wider world, which is a little, maybe even a lot, less fragile, is something to aim for.

Big ideas for the future

There are big ideas about the future out there, about seizing the moment – now is the time for radical change. Two of many examples:

The Committee on Climate Change would like the much lower carbon emissions during lockdown as a stepping off point. And Wolfgang Munchau argues in The Spectator for a bout of creative destruction. Letting ‘failing’ industries and businesses go to the wall.

The aviation industry would be in the firing line on both counts. We’ve already seen Flybe go the wall. And Virgin withdrawing from Gatwick, while BA has stated that ‘there is no certainty as to when or if these [Gatwick] services can or will return’.

Nick Timothy in his new book, ‘Remaking One Nation: The Future of Conservatism’ (reviewed in the London Review of Books by Colin Kidd),  has a different take. Both Boris Johnson and Timothy ‘would claim to want to revamp the interest of the British economy in the interests of workers as well as bosses’. That is indeed very much the mandate on which the current government was elected. But creative destruction can’t take account of workers’ interests. So we’ve a clear and present conflict here.

The Thomas Cook collapse was a recent example. How many businesses, I wonder, would be allowed to go the wall? How much unemployment could the government countenance? Where would the new jobs, many if not most at the high-tech end of the spectrum, be located?

Munchau damns the EU for being ‘good at protecting existing interests’, and for ‘stifling innovation in the process’. The EU’s General Data Protection Regulation (GDPR) would hold back ‘an unparalleled opportunity for the artificial intelligence industry’. Again, we’ve a conflict – between the interests of the wider public and an open-field approach to AI.

We owe the term ‘creative destruction’ to the economist Joseph Schumpeter. It is in the very nature of enterprise and capitalism. New businesses opening up new territory. Old businesses go the wall, and workers lose their jobs.

But Munchau and his like treat creative destruction as a gospel. Likewise commentators in the Telegraph. Brexit is the great new opportunity to throw off fetters. New businesses will rise up and even as the world turns in on itself we will find major new markets which will transform our economy. The theory is excellent. The practical outcome is likely to be disastrous.

What I would like to see is a new dispensation at a European level. Retaining data privacy. But encouraging innovation – with new market opportunities open to all member states. For the UK radical approaches to innovation are far more likely to work out operating at a European level than worldwide. For Europe and the EU trading relationships are in place. On our own we’ll be one amongst a plethora of countries potentially pursuing radical business ideas, and it won’t be easy to stand out from the crowd.

Munchau fears that the EU will put constraints on, for example, an innovation fund he’d like to see set up. He may, or may not, be right. That indeed is the challenge for the EU. I don’t want to re-fight Brexit here. But I do want to see punctured some of the pie-in-the-sky hopes that some, including Munchau, have for a WTO (World Trade Organisation)-rules post-Brexit world.

Above all, his hope that UK industry unshackled from the EU and newly ‘energised’ will finally break out of the cycle of low productivity. This involves a multitude of presuppositions. If we do break out it certainly won’t be because we’ve waved a Brexit magic wand. 

The assumption now is that with an economy in crisis we’re already halfway to a new radical dispensation. But this isn’t like World War Two. People will be expecting their old jobs back, and government won’t be wanting to have them as a drain on resources any longer than it can help it.

My gripe against Nick Timothy is another one, an old one. He’s a Brexit go-it-aloner. The enemy: ultra-liberals and international elites. (‘Citizens of nowhere’, the phrase with which he landed Theresa May, he now claims refers to that elite – not to Remainers. If that’s the case he didn’t tell Theresa.)  Let the new Tory party identify with the working class, not assume that everyone’s aspiration is to rise out of it. It’s ordinary folk who should call the tune. I’ll go along with him on that. (With strong reservations about how opinion is manipulated.) Cameron conservatism assumed people would live with the elitism implicit in its attitudes. Brexit proved they won’t.

His book was written before the Covid crisis but let’s assume that he too sees big opportunities now post-crisis. They will bring a new statist, big-spending, austerity-a-dirty-words approach to the economy. Social conscience won’t be a dirty word. But social conservatism will be the dominant mood. A closed-world mentality at one level, Global Britain at another. How this will play out, who knows. The Conservative party has an old and dreadful habit of equating its own interest with that of the nation. But which interest? The market economy and the old Ayn Randian ideas, on the one hand, pitched against the big state of Joseph Chamberlain and his avatar, Nick Timothy, on the other.

Chamberlain was the great advocate of imperial preference. That idea is still there. A touch of the old divine right. But post-Brexit it will be a hot sweaty world in the engine room. We no longer rules the seas. And big ideas too easily run aground.

Big state will be important post-crisis. So too big ideas, big innovation. Building out from a world which may or may not be changed forever. But if we imagine we can do this alone, without Europe, we’re badly mistaken. Yes, we could become a fifty-first state. Some may prefer this. But going it alone should never be an option. We need that agreement with the EU by 31st December.

Munchau argues that ‘compared to the great lockdown, the effect of a WTO Brexit would be small’. True, but it assumes people at large will be prepared to accept that the economy doesn’t get back to its pre-virus levels. That they won’t mind us limping along for a while, in the vague hope of a new wider prosperity further down the line. It looks to me dangerously like using the virus as a cover for the economy under-performing.

We’re on dangerous ground here. But an economy and overseas trade operating on WTO rules looks to be what we will have unless a new wisdom prevails before the end of the year.

A great sadness will be that we miss the great opportunity of working with like-minded people across Europe to build a better post-Covid world. Anyone who imagines a sudden tiger-economy-style breakthrough is simply in cloud-cuckoo-land.