Infrastructure and the Genoa bridge

Infrastructure hasn’t over the years been a topic of too much debate. It simply went on, all around us, yet curiously out of sight. We’d complain, some of us, about HS2 and Hinckley Point, but these are new glamour projects. Not the day to day. The day to day is about detail, hard graft, the invisible – and the maintenance of what we have.

All has been suddenly thrown into a much sharper perspective by last week’s collapse of the Morandi bridge in Genoa. The human cost is terrible, the economic cost (access to Genoa’s port, north-south communication) serious, the political cost (Italians disillusioned with government now even more so – but to whom do they turn?) likely to be high.  Italy’s interior minister blames the Eurozone’s strict rules on budget deficits – but as the Financial Times points out ‘a bigger constraint is the crushing burden of interest payments on Italy’s public debt’, 132% of annual economic output. (Source: Tony Barber, FT 18/19 August.)

Italy is not alone. Germany has bridge issues of its own. Obama’s transportation secretary described the US as ‘one big pothole’. Much of the road network across Britain, once you leave the motorway system, is in a poor state of repair: not dangerous, but a significant impediment to good communication.

(How many other bridges small as well as large on motorways across the developed world are suspect? The Genoa bridge had passed all its tests. I’m reminded of the long-term roadworks on the M5 just south of the M6 junction. You see few workers on the motorway itself: there are 40 or so (notices tell us) out of sight, working below the road surface. That at least is re-assuring.)

Quoting Tony Barber again: in the UK, ‘governments of all political stripes tend to neglect unglamorous small scale infrastructure projects and repair work in favour of ostentatious schemes with predictably spiralling costs.’

HS2 (high speed rail link) is a case in point. Local infrastructure (taking in the north-west, north-east, south, and south-west of England, and Wales and Scotland – HS2 may in twenty years time, with a following wind, just about reach Manchester and Leeds) and high levels of maintenance of existing infrastructure would be a far wiser way to spend money. In the case of Hinckley B (our very own Chinese-financed nuclear power station), funding requirements have trumped political considerations – and reduced our scope for independence and influence in the world.

One other consideration, which Italy’s situation highlights. Massive infrastructure self-evidently requires massive maintenance and repair costs, and that assumes continuing stellar economic performance. Will we need our skyscrapers in fifty (or a hundred) years’ time? Will our road networks be underused, radically underused, as we develop new modes of transport?

We move too fast, too blindly, and that won’t stop any time soon. The Chinese Belt and Road initiative is one guarantee of that. Development is driven as much by political and strategic as well as economic considerations. (One powerful reason why we need to be part of the EU – only that way will we have serious political heft in the world.)

What we can do is hold to the simple truth that infrastructure requires maintenance, and put aside the money in national budgets across the world to ensure that it is carried out to the highest level. That is the imperative now. (Easy to say, immeasurably harder to ensure it happens.) As for the future, we cannot simply rely on continuing high levels of prosperity as a guarantee of the required levels of funding, via taxation and borrowing or private investment.

If we cannot be confident in the long-term maintenance of our infrastructure, then we shouldn’t be building. One day our leaps into the dark will come to haunt us.

The politics of aid

The press, parliament and the aid agencies

Press and parliament have had a field day damning the aid agencies for their handling of sexual misconduct among their employees – for allowing (that one word is weighted) the exploitation of the most vulnerable people on the planet.

No-one, least of all the agencies (whatever committees of MPs might report), would downplay the issue. But there is another side. As Kevin Watkins (of Save The Children) wrote in the Guardian a story that started out ‘as a report on predatory behaviour by some Oxfam staff in Haiti has transmuted into a crisis of trust, an attack on aid, and a threat to humanitarian action’.

Why does it matter, he asks:

‘That question matters for some of the world’s most disadvantaged people. Agencies like Save the Children are a link in the chain between UK public money and the women and children whose lives have been torn apart by humanitarian emergencies. UK aid and public donations mean that we can provide life-saving maternal and child health services for Rohingya refugees in Bangladesh. They enable us to deliver education to Syrian refugees, immunisation to children in the Democratic Republic of the Congo, and protection to unaccompanied children in South Sudan.’

Last Monday (30th July) a parliamentary committee released a report, which the BBC summed up as follows:

‘The aid sector is guilty of “complacency verging on complicity” over an “endemic” sex abuse scandal, a damning report from MPs has said. Stephen Twigg, chairman of the international development committee, said charities were “more concerned to protect their own reputation”.’

John Humphrys’ interview on the Today programme on Monday morning, just after report was published, gave only a complainant’s story. I believe her story, but the advantage in such interviews, when you have the interviewer’s support, is all with the attack. There’s no place for the defence. Humphry’s, and the BBC’s, approach in such matters is tied to the 24-hours news culture. As it was (and is) with the MPs’ expenses scandal, climate change and Brexit. Reithian values of ‘educate’ and ‘inform’ should be demanded of the headlines and the opening stories as well as the back story.

The BBC still does the back story very well. And I’m not suggesting we should hold back on our anger with aid agencies who fail to address one of the big issues of our time. But they are the ones with the difficult job. Reporting, whether a House of Commons’ committee, or the BBC, comes easy. They don’t have to face the consequences of their actions.

I don’t believe for a moment that the sector is ‘complicit’, or ‘more concerned to protect their own reputation’. They have the hardest job in the world, working with least privileged, in often terrible circumstances. There are sexual offenders wherever adults work with the young or the defenceless or the underprivileged. In children’s homes, in the Catholic church, in aid agencies.

The ‘back story’, the real story in this case, is put well by Kevin Watkins in the same piece in the Guardian: ‘An epidemic has affected institutions across our society… [an] epidemic rooted in the unequal power relationships that enable powerful and predatory men to exploit women and children through bullying, sexual harassment and outright violence. The only antidote is a culture of zero tolerance, backed by rules, recruitment practices, and leadership.’

‘Development agencies cannot get this wrong,’ he continues.  ‘We are dealing with some of the world’s most vulnerable people.’

The news I want to hear is how each agency is handling this issue, not just in terms of codes of conduct or investigations, but in practical terms, on the ground. I will give Kevin Watkins the last word:

‘In Save the Children, we have been working to strengthen our screening systems to keep predators and bullies out of the organisation … How do we stop humanitarian aid workers who violate our values moving from one organisation to another?’

We don’t need the hyperbole, we need people like Kevin Watkins reporting back, keeping us in the loop.

Spring, Michele Hanson, Pinker, Kahneman, Brexit, Ursula LeGuin – a few one-sentence blogs

Time is pressing and I’m off on holiday to an island where I’ll face south across the ocean and follow the sun, and climb up to the cloud forest behind. But there are blogs that I’ve wanted to write. So I thought – how about a blog of single sentence. (Max two, but you’ll see how this expands.)

Brexit: in his speech to his party’s spring conference yesterday, LibDem leader Vince Cable argued that “nostalgia for a world where passports were blue, faces were white and the map was coloured imperial pink” had driven some older voters to Brexit. In response to the uproar from some in the Tory ranks I’d simply say that some truths are self-evident – and add the reminder that without anti-immigrant sentiment Brexit would have been decisively defeated.

Michele Hanson: the Guardian columnist died a few days ago, after 34 years (I think) of writing a column for the Guardian. I knew her a little back in the 70s, we had mutual friends, and I’ve caught up today with a few of the columns I didn’t read, and found them both downbeat and upbeat, wise, warm and rather wonderful – whether she’s writing on care homes, dogs, family, personal hygiene – she engaged so many people with moments and issues in life they could connect with.

At the other extreme my old bete noir, the fluffy-white-haired guru Steven Pinker, paired in this instance with the 18th century Scottish genius-philosopher, David Hume, whom Pinker neglects to mention when talking about the enlightenment – and who stated clearly and succinctly that “reason is, and ought only to be the slave of the passions”. In other words, don’t give reason space which it oughtn’t to have – give it, I’d argue, shared space, let one inform the other, and take both out beyond our private lives into the public sphere.

Thoughts from Tim Harford in the FT, quoting Daniel Kahneman: “When faced with a difficult question we often answer an easier one instead, usually without noticing the substitution.” In the case of the referendum the difficult question being “Should the UK remain in the EU”, and the easier substitution “Do I like the way this country is going”.

The last item was two sentences – so I’m adding a third from Harford as a separate item – a rather obvious cheat. “No voter can master every issue … referendums instead invite us to ignore the question, give the snake-oil peddlars an edge, concentrate our ignorance into a tightly-focused beam, and hold nobody accountable for results.” Right on.

For something completely different … Alexander Harris in the Tate Etc Magazine: “So I became a collector of early autumn evenings. In the ancient analogy … the time of youth is spring. But I remember only one or two spring days from my childhood – it is all autumn: the orange of the late crocosmia flowers meets the spotted yellow fringes of hawthorn leaves; blue skies deepen above glowing stone walls, and then it all softens to a yellowy grey haze…” That set me thinking, and I only half-agree, and maybe that’s because my pre-eminent spring memory is of a day in May walking in the Cheshire hills with my first girlfriend, and spring was suffused with birdsong and a funny feeling of elation, of walking on air, that I’ve never quite recaptured …

(Treating Alexander Harris’ quote as one sentence …)

A quote from Neil Collins, an old-friend from the 70s who I haven’t seen in maybe forty years, in the FT, in the context of the collapse of Toys R Us and Maplins: “Is yours a zombie company… [zombie being] defined as a company that has failed to earn its interest cost for two consecutive years and is valued at less than three times sales. …[The Deutsche Bank] comprehensive analysis of the world’s 3000 biggest businesses implies that more of them [this year than last] have discovered a strategy for survival – [instead of just] clinging on, merely waiting a mercy killing from rising interest rates.” Two reasons for including: one, a reminder to me and anyone who enjoys abstruse speculation that there’s a hard business world out there, and if we choose to rant against capitalism we have to remember how bloody hard and ruthless the business world is  … and, two, whatever’s happening in High Street retail, things are getting slightly better – are they???

Rediscovering Ursula LeGuin, someone else who’s died recently: there’s a new book which collects together her non-fiction, ‘Dreams Must Explain Themselves’. She had Taoist beliefs … that established an instant bond – the Tao, or Dao, the way, is the wisest, simplest yet most all-encompassing of notions; and she admired Calvino, Borges, Woolf, Twain, Tolstoy and Tolkien. And how about: “To think that realistic fiction is by definition superior to imaginative fiction is to think that imitation is superior to invention.” I’ll add my own comment – never curtail that sense of wonder, of fantasy and myth – walk on the wild as well as the wise side.

Four sentences. Time to exit.

Is reason enough?

(References are to Steven Pinker’s new book, ‘Enlightenment Now: A Manifesto for Science, Reason, Humanism and Progress’, and Philip Ball’s excellent review of the book in the March edition of Prospect. Also to Philip Dodd who took on Pinker is a determined interview on the Radio 3 Free Thinking programme.)

A brief weather note to begin. Spring we thought might almost be upon us, but Siberia has chased it away, and the snowdrops are looking a little out of place, and the daffodils have all but gone to earth.

So too reason? And, specifically, the pursuit of reason in political argument and debate?

I’m reading so much about identity, culture wars, anger and estrangement – and now with Steven Picker’s new book, the Enlightenment is in the news. How can I not be a big fan? The rigorous application of reason brought to bear on all aspects of our activities. As advocated by Diderot, author of the Encyclopedie, the seminal text of the Enlightenment.

Sleep of reason

Goya’s The Sleep of Reason, ‘the sleep of reason produces monsters’, from his series of etchings, Los Caprichos, 1799.

But has the Enlightenment also gone to earth? Pinker thinks not – argues powerfully against.

I’d love to sign up unreservedly to his paean to progress – things are getting better, as the statistics and graphs tell us, incontrovertibly so – we are all living longer, better educated, immeasurably better off if we take the world as a whole. But what troubles me is his ‘aversion to anything subjective’, as Philip Ball puts in his review. Pinker denies religion any role, likewise identity, tribal identity – and that means shared beliefs in progress, humanity, compassion, sometimes God. He has no place for out-there institutions, places of worship, and the collective action they often embody – action against poverty, hardship, exclusion – inspired by and acting out of love. Compassion, as I argued in a post of a few years back, discussing Pinker’s last book, The Better Angels Of Our Nature, doesn’t get a look in.

Can reason be enough of itself to triumph over violence?

For Pinker man is ‘born into a pitiless universe [and] shaped by a force that is ruthlessly competitive’. Only reason can hold out against this. And reason finds expression in democracy as the most effective way to gain traction. Thomas Hobbes had a similar view of mankind, but saw our only hope as lying in contracting with an autocratic ruler. With Xi Jinping seeking president-and-party-leader-for-life status we’ve a good example of that alternative path closer to hand. Turkey likewise, and Hungary and Poland moving in that direction.

Reason simply isn’t enough on its own. It’s not solus reason that’s leading the charge, it’s religion, and reason together, and by religion (a maybe controversial definition!) I mean the exercise – the acting out – of an innate compassion, a rather un-Darwinian concept. Not just the compassion of mother to child, or a care worker to her charges, or a priest or minister toward his congregation, but compassion as an innate moral code that informs the wider political workings of society.

Pinker’s right in there, unworried about his PC status, arguing that the left, supposedly champions of the working-class and the left-behind, has focused too much on issues of sexual and cultural identity – and lost connection with the old working class. Marx is excluded from the pantheon but Hobbes indeed is one of the good guys. Fascinating as intellectual debate, but where is the connection with the everyday?

Reason is too chill to excite, too cerebral to inspire (unless you’re Pinker). We are where we are today because the passion and compassion of reformers, secular and religious, has consistently challenged enterprise and competition – to the benefit of all. Championing education, social welfare, safety nets in time of need. It’s when society believes in and acts out a shared morality that we move forward.

Pinker has run himself into hot water in recent weeks arguing that inequality isn’t a major issue for our times – the majority worldwide is in our times so much better off – but inequality is a key driver of social action. Inequality is tied in with a sense of being left behind, on the outside. There’s a big poker game running, but it’s (the UK) down south, or (the USA) up in the north-east, or out on the West Coast, and I’m not invited.

If society isn’t inclusive, if it isn’t compassionate, those who perceive themselves as excluded will set themselves up as ‘the majority’, will scale down compassion to actions within their own social group, and society will polarise, and nations seek out their own identities, and close borders, and all the grand tenets of the Enlightenment will be even more confined to discussion among academics.

This zenpolitics blog is about strategies for living, if that doesn’t sound too grand – I’ve summarised them before as enterprise and compassion, social justice and capability. Yes, there’s a violent side to all our natures, but it’s more our competitive instinct that dominates and drives society forward. Violence arises when we push back selfish boundaries too far.

Compassion and competition work together. If competition is centrifugal, tearing apart, at its extremes, violence, then compassion is the opposite, it is the instinct that binds – and it is innate. Pinker would scorn such notions.

Pinker’s wonderful to listen to – he signed my copy of Better Angels at a Royal Society of Arts talk some five years ago, and we had a few words back then. (Our subject – was war inevitable in 1914?) But his argument hasn’t the essential motor, the sine qua non, to progress.

It will fire the campus and the book pages. But beyond?

Free trade – whatever the cost?

Free trade and a hard Brexit are all but synonymous. There’s an obsessive quality about free traders, men on a mission, who feel their time has come: seize the moment, lest it slip away.

Daniel Hannan and Boris Johnson recently helped launch the Institute of Free Trade, arguably duplicating the work of the long-established Institute of Economic Affairs. I’ve always had a sense of vast lacunae between argument and reality among free traders, and I turned to an article on the IEA website, by its chief economist, Julian Jessop, to check out whether this judgement was justified. For the full article see:  https://iea.org.uk/whos-afraid-of-free-trade/

Jessop expresses puzzlement as to why ‘the economics commentariat’ (i.e. most economists) had given a ‘sceptical, with some downright hostile’ response to two papers advocating a policy a free trade once the UK leaves the EU, by Professors Kevin Dowd and Patrick Minford.

It may be unfair to quote passages and not reproduce the whole article, but to my mind they do speak for themselves.

‘… it has been suggested that Prof Minford’s analysis shouldn’t be taken too seriously because his forecasts of the economic and market impacts of the vote itself were inaccurate. As it happens I don’t know what Prof Minford was forecasting in 2016. But nor, frankly, do I care….’

‘Professor Minford’s current and past work in this area has been challenged for using what some regard as a simplistic and out-dated model of world trade. But the ‘gravity models’ favoured by many of his critics also have their flaws. Even if Professor Minford’s numbers are only as good as his models (which is always the case) …’

The phrase, ‘the underlying principles are as sound as any’, is key: there is a millenarianist belief in free trade as a universal panacea, the UK’s adoption of which will open the eyes of the rest of the world, as Britain did once before, in the early 19th century. ‘Gravity models’ refers to the long-established and incontrovertible pattern of a much heavier weighting toward trade with one’s neighbours, than with more distant countries.

Nonetheless, whatever the correct interpretation here, these legal points do not weaken the more important economic argument that the UK would be better off lowering its own trade barriers regardless of how the rest of the EU responds.

Free trade it seems works because it works, regardless of circumstance. In what sense better off – who would be better off?

‘… of course, there would be some losers from free trade among consumers as well as producers …

‘….there would be some losers..’ The reality is that the disruption would be extraordinary.

Others have suggested that trade can never be fully ‘free’, because of non-tariff barriers. But this is tedious semantics. Even if unilateral free trade only results in freer trade, relative to the status quo, that would be an improvement.

‘…tedious semantics’? There’s an impatience here, a touch of the Gadarene swine.

What then about things that we do produce ourselves but where other countries have a genuine comparative advantage? Why should we subsidise domestic producers if consumers can buy better or cheaper products elsewhere?

A few suggestions as to why… Easily disrupted supply chains, sourcing expensively at long distance, security implications, quite apart from the disruption to urban and rural landscapes as industries close and new ones – we would hope – spring up elsewhere. But in the chaos, and the economic disruption, what certainty is there that new industries, competitive on the world stage, would rise up?

**

Read the whole article: you may find you’re on his side, not mine.

The Grenfell aftermath – and the future of housing

I was discussing the Grenfell inquiry with friends last night. We were vociferous, and of divided opinions.  But I also wanted to see where we might go beyond the inquiry.

We already have a highly polarised, and political, debate.

The great danger – the more political the inquiry becomes, and the more personal, the longer it will take, and the more ensnared it will become. The local MP has called for the inquiry chair to be replaced: she wants ‘somebody with a bit of a human face’. We recently had the Mail seeking to disparage judges and the rule of law, we now have Emma Dent Coad seeking to do the same. Whoever heads the inquiry needs first and foremost to be impartial.

George Monbiot in the Guardian has damned the enquiry as a stitch-up. I don’t believe it will be – or can be. It will, as did Chilcot on Iraq, develop its own momentum. Monbiot has already decided that the Grenfell Tower disaster is a crime pure and simple. He’s linking it with the government’s Red Tape initiative, intended to cut back regulations, including building regulations. Let the inquiry takes its course – the government’s attitude to regulation is already a big issue – let’s see where the evidence trail leads us.

What we don’t need is calls to boycott the inquiry on the one hand, and the kind of sustained disparagement of groups of local campaigners as agitators (the speciality of the Telegraph) on the other.

But the inquiry should be only part of our response. There’s a wider field in play.

What we need above all is a radical focus on building new homes, and a radical reappraisal of the role of tower blocks in public housing. This was for me the main point of our discussion last night – would any significant change, wider social change, come out of the Grenfell aftermath and enquiry?

I want to see us, see the country, the government, establish a different direction of travel. Policy goals and green papers will follow later. But after forty and more years of failure housing as an issue now needs to become centre stage.

Put in simple terms, we need a radical increase in the building of new homes: new homes for the young; new homes in areas of rapid population growth; but above all new homes for the urban working-class, who have been shovelled into ill-kept tower blocks for far too long. Ultimately and long term I’d to see high-rises, with all their empty space around, replaced by something much more low-rise, more community-focused.

Building would need to be of a much higher standard, and funded by local councils to whom the government would devolve funding. Housing associations would be encouraged to build up and not sell off their housing stock.

The Grenfell tragedy has focused minds – we need a rigorous, impartial inquiry – but we also need to look beyond.

Austerity versus stimulus

Don’t let anyone say I avoid the big subjects!

Whatever one’s instincts, where lies truth? Is there any definable ‘truth’ when it comes to this debate – stimulus versus austerity. A good starting-point is a book of that name, just published, a collection of essays edited by Robert Skidelsky and Nicolo Fraccaroli.

The question, as Robert Skidelsky and David Blanchflower argue, ‘is whether Britain should be compared to Greece… Britain could, the Keynesians argue, continue to expand its debt with no risk of lowering confidence in the economy, as long as that debt expansion was used to pay for growth expanding projects’. But does high government borrowing push up interest rates and inhibit private investment? – Friedrich Hayek’s argument.  Is there a danger that people will lose faith in the management of the economy? – Niall Ferguson.

The UK national debt will peak this year at 89% of GDP, the biggest since the 1960s and up 36% from a decade ago.  (Paul Wallace, Prospect, July 2017.) I’ve seen figures for the first quarter of 2015 indicating that the annual cost of servicing the debt was £43 billion, but a third of the interest in that debt is the government paying interest to itself – the result of quantitative easing. On the other hand interest rates are currently very low, and could rise, and in  Paul Wallace’s words, ‘The Treasury is right to worry about maintaining fiscal headroom to respond to a future downturn.’ But if we take out that one-third which the government is paying itself, then it doesn’t look quite so bad.

Comparisons with other countries are helpful, and confusing. My data isn’t up-to-date, but the USA debt was over 100% in 2011, and  Japan’s debt is approaching 200% of GDP. Paul Wallace quotes the IMF, which puts our public debt as the sixth highest of 26 advanced economies. The CIA World Factbook ranked us 18th internationally.

And what about total public spending, another key indicator? Down from 45% in 2009-10 to 39% now – which is its pre-crisis level of 2007-8.  Wallace points out that in the late 1980s Britain spent virtually the same on health and defence. Today we spend nearly four times as much on health.

What this tells me is that there’s a case to be argued on both sides. For stimulus and for austerity. But I’m a Keynesian at heart. Keynes understood that confidence is everything, investment and not retrenchment is the key, and that the private sector is the driver of all successful economies. At the same time there is nothing intrinsically wrong or to be frightened of when it comes to public expenditure.

I think the phrase I quote above is key, ‘as long as that debt expansion was used to pay for growth expanding projects’. So – just one example, but an easy one – scrap HS2. Any growth benefits will be miniscule compared to the benefits from investing the money elsewhere – not least in other infrastructure projects.

Where does this leave the NHS? Real spending on the NHS increased at a rate of 1.1% under the coalition, compared to 4.1% a year over the past few decades. In addition, much of social care is in crisis. Benefits will be pared back further in the coming years. Prisons are too often scary and ineffective places…. This where increases in current expenditure have to be focused. Not on re-nationalising energy supply or the railways, whether such goals are worthy or not. As for scrapping student loans – a contributory scheme, an adjustment to rather than a scrapping of the scheme, may be one way forward. Paying off existing loans would not be a sensible use of resources. And what of scrapping the 1% pay increase limit for public sector workers – a highly inequitable restriction, enforced for four years – and now the subject of very public bickering among cabinet members?

This takes us to current arguments about increased taxation, and how effective that might be. Could it be increases in VAT, and /or a mansion tax (highly controversial) – where revenue streams would be certain in a way that that increasing the top rates of tax or hiking corporation tax wouldn’t be.

With continuing impacts from globalisation, and automation, the future is massively unpredictable. My only sure conclusion at this time is that austerity, as currently enforced and anticipated, is unnecessary and counter-productive. But how we spend wisely – and at the same time promote investment and encourage business and international trade – that is another matter.

What is absolutely certain is that we don’t need the tomfoolery of Brexit. And we do desperately need a competent government.