Craving Competence

After Covid exposed many leaders around the world, and after the global chaos created in the Trump White House, it is interesting to note a trend in 2021 towards a desire for competence. 

Competence in a political leader has an innate problem, which is that the competence to get elected often proves a hindrance to governing and vice versa. Getting elected involves plotting, charisma, vision and exaggeration. Governing involves delegation, teamwork, plans and patience. Few have both, and we usually only learn this once we have elected somebody wholly unsuitable. But it is our own fault because we make the same mistakes again and again.

 

Two elections this month exemplify the trend, admittedly in two rather competent, nay boring, countries, Canada and Germany.

 

Yesterday, Justin Trudeau appears to have been re-elected as prime minister of Canada, but when he called the election his purpose was to secure a majority mandate. In reality he failed to even secure a plurality of votes and only won the most seats thanks to a favourable election system, but only enough to continue with an unstable minority administration similar to that he enjoyed before calling the election.

 

How did this happen? Well, Trudeau looked at his primary opposition and saw a Conservative party with a dull new leader struggling to find his feet, and thought he could turn that to his advantage. He was wrong, because Erin O’Toole actually fought a superior campaign, cleverly tuned in to what the centre of the electorate sought, competence. I loved his slogan that Canada needs a handyman not a poster child. Well, they still have their poster child, but the handyman certainly threw a spanner into the works.

 

The German example is even stronger. The Germans have benefited from a plainly competent and competently plain leader for many years in the form of Angela Merkel. Since she announced that she would be retiring three years ago, her party has tried out at least three possible successors. After some humiliating failures, they landed on Armin Laschet, a clubbable sort of bloke with some of the charm they hoped would be effective in an election. Wrong again. Laschet has never been known for his competence, and managed to mess up handling the August floods during the campaign, among other blunders. Meanwhile Olaf Scholz successfully portrayed himself as a Merkel clone, experienced and dull, and competent. His slogan was something like “Olaf will sort it out”. He is another handyman, and this one looks set to become Chancellor, reversing a generational decline in the fortunes of his party.

 

There are other examples of the trend. Mario Draghi in Italy fits the bill, although he owes his position more to politics than votes. Sir Keir Starmer is trying to use exactly the same positioning in the UK, so far without noticeable success. It goes beyond politics too. In business, we seem happier listening to a Tim Cook than a modern day Jack Welch, though Elon Musk is defying gravity, even earthly gravity, for the time being. Bill Gates secures plenty of airtime with his dull but accurate analysis. 

 

Maybe the best example of all is President Xi. We might not care for some cynical policies, or the centralisation of elite power, or even some economic actions, but one thing they all have in common is competence in execution. Economically, his team has navigated many growing pains with remarkable success, and I am backing them to continue their good run. And politically China is out-manoeuvring the US at every turn.

 

So that brings us to the US. The same trend is in evidence. It was noticeable in the New York mayoral primary that the poster children flamed out while competence became a magic sauce. Kathryn Garcia, as dull a performer as is imaginable, nearly won based on how competently she had managed New York's  garbage collection agency. Fiery Democrats in other cities are toning down the rhetoric and focusing on building a track record of results. Hooray for that.

Biden campaigned as the antithesis of Trump, and competence was clearly a part of that story. Domestically his team have appeared competent so far, steering through a Covid relief bill, forming a feasible strategy for his larger economic package, and handling everyday matters neatly, including the vaccine minefield. But foreign policy has told a different story.

 

Antony Blinken and Jake Sullivan were sold to us as experienced and reliable operators, but I have seen little evidence so far. The first meeting with China was reportedly a shambles, disintegrating into a shouting match within minutes. There is much talk of inflection points and new doctrines, but so far I see no substance and a consistent misreading and misanalysis of the main competitor.

 

Then we can add in the execution of the withdrawal from Afghanistan. How could the intelligence have been so far out? I guess we can blame the same complacent military spokespeople who blithely made false initial claims about their shocking drone strike. The whole operation was mis-sold and poorly executed.

 

A rare ray of hope comes from the climate progress, and, despite a lacklustre G7 meeting, I am optimistic for Glasgow. But that can be attributed to the smart appointment of (competent) John Kerry rather than anything achieved by Blinken’s team. But that same G7 also failed to provide the required and eminently achievable bazooka of global vaccine billions.

 

Of course Biden and Blinken have a fair excuse that Trump actively destroyed the State department during his tenure. Building back confidence and competence will be a job for multiple presidencies, and it also must be tough to get allies to work together with the US after the betrayals of trust under Trump, and the nagging fear that he may return.

 

But now we have another awful own goal with the questionable policy of equipping Australia with nuclear power submarines (aren't there treaties about this sort of thing?). This has the feel of something rushed through to create positive domestic headlines after Afghanistan. But to have annoyed the French to the extent that a nominally close ally and vital player on the UN Security Council should actually withdraw ambassadors shows just how incompetently the whole incident was handled. This never happened under De Gaulle, and not in the “freedom fries” era of the Iraq war, so we can guess how angry the French are.

 

There are a few more encouraging signs. Biden talked to Xi for ninety minutes last week and took a collaborative tone at the UN today. But this feels pro forma; I will start to believe in competence when I see the team consider how they might look to China and consider some steps that make cold war less likely rather than more. Some respect for international institutions would be a good start.

 

It is hard to know how long the sober mood among electorates may last. In many places a handyman is not on the ballot even if the public would vote for one – think Brazil, Argentina, India or even Russia. Perhaps Boris Johnson’s long honeymoon will end eventually. And perhaps competence will be important in 2022 and 2024 in the USA. There is no space for anybody competent on the Republican side just now, so we need the Democrats to step up. Admittedly foreign policy does not weigh a lot on voters’ minds, but it is foreign policy that ultimately has the most impact. Blinken is running out of time to demonstrate that he and his team are up to the task.    

9/11: The Question rarely asked

I have recently become a grandfather. Even though Kiara lives in Dubai, we have been lucky enough to spend her with her twice already. Life and its development is such a miracle, so wonderful to behold. Having said all that, how parents can find the energy required to get through those months is an extraordinary part of that miracle and a part I’m grateful not to have to endure again.

 

Everything in the makeup of small children is designed to grow and to learn. It is remarkable to see those tiny limbs learning to achieve small breakthroughs and to observe those young eyes absorbing everything around them in order to feed the developing brain with the information it needs to learn. Observing Kiara it became easy to understand how important a supportive environment is to a new baby, right from the very start and probably also in the womb. So much of our destiny is determined in the first phases of our lives.

 

I spent a lot of the time with Kiara recalling the first months and years of her mother. At the time I was blessed to have a job where I could spend half of my working week at home, so I could participate and observe more than most fathers of my generation. A particular tendency that came to mind was the way children go through a phase when it seems virtually their entire vocabulary consists of the word “why”.

 

It was so tiresome, constantly trying to find new explanations for everything around us using language that a young child might comprehend and learn from. Luckily the phase only lasts a year or so: perhaps the child starts to realize that the parent doesn’t have so much to offer, or is becoming too frustrated to give of their best and might start punishing them in other ways for their curiosity.

 

But of course there is a reason for the choice of question. Asking why is the most efficient way to learn the most, and as part of the miracle children are somehow programmed to understand this. There also realize that asking why repeatedly can help to deepen that learning, because answers can move beyond the superficial towards deeper insights. The parent becomes tired (again), but crucial wisdom is being imparted through the process.

 

It is strange how later on we tend to forget the value of asking why. There are one or two situations where I have retained the good habit. Whenever I was involved in any sort of root cause analysis, I developed a good habit called “five levels of why”, in other words asking why something may have occurred at least five times to establish deeper truths.

 

Last weekend a car driving on the wrong side of a small street in Brooklyn crashed into another car, causing the death of a child pedestrian. Why? Well the car was on the wrong side of the road. Why? Maybe the weather was bad or lighting or signalisation was not good. Why else? The car and driver had been flagged for over 150 violations over the last five years yet were still on the road. Why? Now it is starting to get interesting.

 

I also found the why question very useful when interviewing people for jobs. Candidates tend to prepare a series of pat answers to questions they expect, and interviewers often feed those questions, with long enough preambles for the candidate to be able to navigate the course. Hearing what a suspected might be a superficial answer, I would just simply ask: “why?” The question was always unexpected and always revealing. Good candidates might need to pause but could then articulate something to develop their previous answer. Unqualified candidates could not.

 

This past week has seen a lot of introspection in the US brought on by the twentieth anniversary of 9/11. I have been impressed by a lot of the commentary. The PBS news hour, as usual, has led the way. One of their leading journalists, Amna Nawas, is always piercing in her interviews. During the pandemic we have become used to her home, and the two spaces she uses to broadcast there, one with a sober green background in a corner of what may be a living room and the other probably an office. The office has a prominent poster on the wall, with all the common interrogatives listed in last print, no doubt a treasured aide memoire from her early days as a journalist. Of course the why question sits proudly towards the bottom of the list.

 

Yet for all their excellence, even the PBS news hour often neglects to ask that why question, or at least fails to employ it enough times. There were strong panel discussions with military and diplomatic officials, but mainly they focussed on how the USA reacted to 9/11, the justifiable moves and the mistakes made. As usual on Friday David Brooks made intelligent observations while Jonathan Capehart bored with inanities – how did he get that job?

 

But for all the strong journalism, I don’t think I ever heard anybody asking what for me is the most revealing and valuable question: why? Why did Al Qaeda attack the USA? The USA security had become complacent and because various regimes were permitted to harbour extremists. Why? Bin Laden exploited those weaknesses with an admittedly brilliant plan, which in the end achieved its goal of destabilising the west. Why? Bin Laden and his coterie were evil. Why? Now it might start to get interesting.

 

Intelligent and ambitious Sunni Muslims have not had a legitimate political outlet for many generations. Too much misogynistic and proselytising dogma has taken root in mosques and governments, and not enough poverty reduction or education. Muslims have grown up angry from listening to true stories of an insulting lack of respect against their kin. Western policy moved from harbouring despots during the cold war, through disinterest and triumphalism, towards the hypocrisy of defending a so-called rules-based global order that was empty and optional for its own people.

 

Ah, now we are getting somewhere. The harbouring of despots contributed to the lack of political outlet. The harmful dogma was tolerated because parallel dogmas of other religions bankrolled politics in the west. The rules-based order is unchallenged propaganda, while any remaining high ground has been surrendered in Guantanamo and Abu Ghraib. There is little attempt to understand the cultures and wishes of foreign nationals.

 

The saddest outcome of the last twenty years of folly has been that all of these root causes remain true today; indeed they have all become more entrenched. Creating policies to address them is tough: nation building is usually mishandled and is inherently arrogant. But such policies can only emerge if the lessons from the past are actually teased out. And that only happens when the adults learn from their own children and grandchildren and are humble enough to ask the why question, again and again and again. Let us pray that it does not take another twenty years before such a process can start to occur.    

The next Cold War

 It is widely claimed that the USA and its NATO allies won last cold war. In 1989 the Soviet Union collapsed, and for a decade NATO and the US banks reigned supreme, even trying to impose their economic model on the rump of their former adversary, with predictably disastrous consequences.

 

Few would claim that the Soviets won, but many had cause to regret that the war took place at all. The development of Africa was compromised when its newly independent political structures were undermined by strongmen tied to one side or the other. South America fared little better. Korea and Vietnam were among many countries to endure tragic loss of human life in the name of nebulous goals. Even though the fragile peace gave us i-phones and second cars, it is reasonable to argue that we were all losers in the cold war. At least they somehow avoided nuclear war.

 

This week sees the twentieth anniversary of the 9/11 attacks, and a chance to reflect on the wars, cold or hot, of the last twenty years. Many commentators have linked the shock of that attack to the suspicion, nationalism and introspection now prevalent in the USA, epitomized by Donald Trump. Perhaps that era reached an end last month with the ignominious withdrawal from Afghanistan. The USA is surely ripe for a new philosophy. We have reached a tipping point.

 

While the USA was wasting its resources and focus in the Middle East, a new kid has emerged on the block. The world’s most populous nation started focusing on development over ideology under Deng and has used its own playbook to create spectacular success, taking more than half its huge population out of poverty.

 

China’s leaders have been very clever. Until recently they have not tried to challenge things that the USA and its allies hold dear, complying more or less with the so-called rules based order that is essentially a recipe for the moneyed nations to do whatever they like. Instead they worked out what those moneyed nations craved and set out to provide it. First China became the cheap manufacturing and logistics hub for the developed world. Once this created some wealth, it propped up the western financial system by offering tempting investments and depositing its own money. Lastly it offered its own growing market as customers for western firms to grow. The west loved it and those of us who own stocks became richer as a result.

 

Nowadays we like to moan about how China cheated, but it is not really a substantial claim. Western firms were all too happy to allow local partners into their Chinese ventures and for intellectual property to leak, because the benefits outweighed the costs.

 

China became richer, and many of its citizens reaped the benefits. Gradually, this allowed the leaders to become bolder. The massive trade surplus did not all have to sit in western securities: some could be invested in other countries, shoring up the Chinese supply chains and building leverage. Some limited military leverage could be created too – not to attack anybody beyond its own backyard, but to deter others from interfering. The citizens were so happy becoming richer that they became more trusting in the leaders even when some liberties were removed. It is a fair bargain when some national pride is warranted and there is more pork on the table.

 

Through all this, the goals of the Chinese leaders have been clear and consistent. They want to grow the prosperity of their people, while avoiding internal strife, minimising external threats and dealing with what they see as historical anomalies such as Tibet, Hong Kong or Taiwan. The leaders have showed strategic patience and executional brilliance.

 

Perhaps it won’t last, but perhaps it is time to revisit the patronising orthodoxy favouring democracy and capitalism. Picking winners does not work if the goals are corrupt or short-term political, but the Chinese certainly seem to be developing a strong track record.

 

We are led to believe that China has changed over the last ten years, but in reality it is not China but America. Problems were bubbling under, but then came Trump. He tried to humiliate China, an experience the leaders will not forget. China has taken away many lessons. It must make its economy independent of America. It must build leverage to counteract future building. America is not to be trusted. America will lose a staring contest. And America will bluster but not act.

 

I do not have the expertise to explain how, but I see the recent Chinese moves to rebalance its economy as primarily to build defence and leverage against America. It does not wish to use these tools, but is creating them just in case. It is a wise move. Trump is gone, for now, but one of the few things Congress can agree on just now is a desire to bully China. One sad example concerns the berating of Anthony Fauci for allegedly collaborating with China on research about infectious diseases. Surely that should be lauded? But nobody is truing to defend it, only to claim it did not happen.

 

The drift towards a new cold war seems rather inevitable. Who will win? Well, America has military power, but seems to lose most conflicts and has little appetite to confront China regarding its “historical anomalies”. America has money, but look closely and a lot of it is actually Chinese. America has cultural strengths, but smart young Chinese are happy in China – something that smart young Russians never thought. America has the best universities, but I would not expect that lead to survive one more generation.

 

If we think about the USA and China as two giant companies, which one should we invest in? One has unified leadership, clear and consistent long-term goals, a committed workforce, credible plans, key points of leverage and a strong culture of execution. The other is the USA.

 

The Economist’s excellent Chaguan column tried to explain Chinese economic policy a couple of weeks ago. There were valid criticisms about some nanny state tendencies, such as curtailing private tutoring and limiting screen gaming time for kids. But the broad thrust was impressive. It featured development (taking the other half out of poverty), controlling inequality, avoiding corruption, growing strategic sectors, and using the untrammelled power of the state for rapid execution. If a party credibly offered that in its manifesto in the west, it would have my vote.

 

Of course China has challenges. The four goals usually work well in parallel but may also lead to potential conflicts. Much is also made of the unfavourable demographic outlook. Some welfare structures must be developed. There are economic imbalances to handle. Six per cent growth will not be achievable indefinitely, but they seem in a strong position to handle most of the challenges.

 

I wonder if Anthony Blinken and his team, chastened in Afghanistan in the process of rebuilding competence after the carnage of Trump, might be coming to realise how futile this new cold war actually is for the USA. I am encouraged to read that Biden and Xi talked for ninety minutes yesterday. There is an alternative path available. China can meet its goals quite well with authentic American collaboration, if US credibility can be re-established over time.

 

Most wars do not have winners, only losers. We will all lose if the USA continues down the wrong path. Perhaps the UN, or people like the Pope or an Angela Merkel with more time on her hands, can help. The opportunities at this tipping point will surely be fleeting.      

The Follies of the Left

 Growing up, I remember coming across an old saying. Anybody supporting the left in their twenties has no heart, but anyone supporting them in their forties has no head.

 

I am obviously headless. I have always tilted leftwards, but over the last fifteen years or so my tendency has moved further and further to the left. Give me Elisabeth Warren over Joe Biden any day.

 

I suppose part of my leftward drift has come from living in the USA, where I daily witness the greed and emptiness of the right and the negative consequences of their dominance since the Great Wrong Turning in 1980. But I am also far from sure that the old saying works anymore. There has been a gradual swapping over of support between right and left, so that a patriotic, working class, rooted person without a college degree can now be a reliable supporter of the right, while people like me have moved in the opposite direction.

 

This confusing change is partially explained in a new book about the USA I read this week,Last Best Hope by George Packer. I was initially attracted to the book after an author interview on PBS, in which he started to describe four models of archetypical voters. For all their flaws, I love models, and it seems Mr. Packer does too.

 

Packer describes his first model as Free America, epitomized by Reagan (and Thatcher to we Brits). Societal responsibility means little beyond creating wealth, and markets with minimal regulation are the engine for that. Freedom comes to embody a desire for everybody else to get out of the way of greedy desires.

 

The Smart America of Clinton or Obama accepts part of Free America’s diagnosis, while disguising the greed of its adherents behind a cloak of meritocracy. Education and connections yield rewards, and the Smart use their advantages to hoard more and more of the benefits, turning a blind eye with theatrical hand-wringing to those locked out from some opportunities.

 

Free America flatters to deceive, and Smart America adds condescension to the mix, and the outcome is Trump’s Real America, a land of delusion, nostalgia and revenge. Basic competence and truth are casualties as only the Messiah is deemed credible. The creed speaks of freedom, but the entry fee includes subservience to the demagogue.

 

The author, plainly a Smart American suffused by guilt, is suitably disdainful about Free and Real peers, but reserves his greatest ire for his fourth model, Just America. The creed here is of original sin, a pit from which nobody born white or wealthy or male or cisgender can escape. Practical solutions are jettisoned on the altar of unending blame.

 

The models feel just about coherent and explanatory, and tell a story of spiralling dysfunction without an easy way out. The right lost its heart when it became Free, and its soul when it embraced the Real. The left lost its belief when it became Smart and then its head when it moved to Just. But the intelligent of today cannot but try to repel the Real, finding homes where the left has arrived.

 

As so often, the diagnosis and models are more compelling than the solutions, which read uncomfortably like the Biden agenda. The exit from the spiral lies with rediscovering Equal America, where everybody can feel respected. Journalism, education and activism are positioned as possible weapons, but I will not hold my breath, though the author does suggest that similar crises have been endured before. If his logic about respect is valid, then he and I must agree about the Great Wrong Turning, for that was surely the original sin of the current spiral.

 

Sadly, the left does not make itself easy to support. I can actually live with the fanatical wokeness of cancel culture: naïve youth has to have its dogma. For me the bigger problem is its shambolic analytical discipline.

 

Each week I read The Guardian Weekly of the left and The Economist of what remains of the intelligent right. One exudes pessimism, bemoans everything with lazy generalisations about companies that put profits before people and rarely offers any practical solutions. The other has tight and balanced analysis supported by outstanding graphics and does not shirk from brave advocacy. The left may have become Smart, but is often not very smart.

 

A great example is climate change. To its credit, The Guardian has been banging on about environmental concerns for far longer than most publications and devotes many column inches to the subject. But the analysis is never properly quantified and the solutions seem to involve going back to the dark ages. The Economist was slower to the subject but far more compelling once it found its feet, brimming with data and practical priorities, most recently highlighting methane as a low-hanging opportunity.

 

Probably the greatest book on Climate Change policy was issued this year, written by Bill Gates. It contains his characteristic wide and dispassionate analysis, and offers a workable blueprint to deal with the crisis. I have hopes that many attendees of the upcoming Glasgow summit will have read the book and arrive ready to drive to implement its ideas.

 

How did The Guardian review Gates’ book? His content received little attention, in favour of something of an attempt to undermine the author. Somehow it was not acceptable for such prescriptions to come from somebody so rich whose own environmental footprint is so large, what with his yachts and his travel schedule. The review had Just America’s flaws all over it.

 

Another example is the Amazon project for New York City. The behemoth was planning to invest in Queens, creating maybe hundreds of thousands of permanent jobs if all of the associated activity is considered. As soon as the investment was announced, Just America cast it aside, citing the subsidy the City was offering and the general labour practices of Amazon. Within a week, Amazon had decided to go elsewhere.

 

Amazon are not the flashiest employer, but they follow the law, pay on time and provide consistent working conditions and more security than many. The people deprived of their new jobs were not Brooklyn hipsters or the sons of the Smart, they were people eking out a living in multiple sweat shops, probably paid below minimum wage in cash and with the women touched up by the boss on a regular basis. Just America and Smart America conspired to make their compatriots poorer, all over defending a questionable principle.

 

We can do better than that. The left can do better than that, but we languish in lazy out-dated rhetoric rather than trying to address the needs of those we purport to support. We could start by learning from The Economist, starting with metrics. GDP is a wonderful metric for bankers, but a hopeless one for real people. Yet we persist in letting the bankers’ metric be the accepted determinant for human development. Why can the Guardian print a detailed analysis of trends in healthy life expectancy, using country and state comparisons to nail the blame on our Free and Real adversaries? Indeed, how did I observe the 2020 election without hearing a single reference to healthy life expectancy?

 

I represent the Smart. I can be smug. I make sure my own family have all the unearned advantages on offer. But I don’t accept that I have lost my heart, and I urge my Smart colleagues to promote an agenda to equalise those advantages. Elisabeth Warren I a good role model, but even she could go further.     

The All In Society

 One of the more depressing things about travelling in less developed societies is the low value placed on human life. The absence of basic standards in areas such as food or traffic safety, or in police or military behaviour, forces everybody to run unreasonable risks every day. This is turn leads to reckless behaviour and low respect for others, and perpetuates gangs and abuse of force. In such societies, mothers tended to have many children, partly because their own health is not valued and partly to make it more likely that the family farm had enough surviving heirs to continue.

 

In much of the world humanity has made great progress. A virtuous cycle of better healthcare and education is supported by more humane government policy, leading to smaller families and greater value on every individual life. 

 

Sometimes I can argue it goes too far. In pampered societies, the whole concept of the value of a life becomes taboo, causing scarce resources to be widely allocated to keeping centenarians alive for one more month, and to strange decisions in matters such as hostage negotiations. Perhaps the abortion debate falls in the same category, though there do seem to be double standards among many: how can an undeveloped foetus be so precious when a death row inmate or homeless addict or foreign war victim attracts so little support?

 

A key difference between Europe and the USA can be how a human life seems to be valued. It might have to do with the respective histories, with two world wars on one side and a pioneer mentality on the other, but Europe does seem to value its humans more highly. The whole gun culture, universal healthcare, maternity care and traffic standards are examples where Europe seems to have taken a different collective stand. The EU can take credit for exporting its humane standards to its formerly communist members with great success.

 

It does not surprise me that the USA and Europe have been heading in opposite directions along the key metric of healthy life expectancy. With its more positive legacy from the world wars, the USA used to lead the pack (along with Japan). In successive generations, it has been caught up and then overtaken by Europe, so it is now a clear laggard in the developed world. How this is not a major policy debate in the USA is a mystery to me, at least until I consider which interest groups set the policy agenda.

 

I think I perceive a related development emerging in the USA. Respect for life has manifestations at individual, family and societal level. Among individuals in the USA, I have observed something I am calling the “All In” mentality. This is a new recklessness, one that does not directly threaten death, but does risk the prospects of a life that meets basic quality standards.

 

A lot of this comes down to opportunity. When we all lived in villages, we could be reckless in how we used our plough, but most had little chance to stake our wellbeing on chancy business ventures. Nowadays, we can travel and experiment as wildly as we wish.

 

My mother personified the immediate post-war culture in the UK. She was brought up in a sweet shop, and was taught to count the pennies, avoid debt and accept the lot her class determined for her. She was always concerned with risk and instilled cautious values in me too.

 

Especially in the US, there are many societal pressures towards taking risks. Parents and church leaders are listened to much less nowadays than influencers. Hollywood and politicians relentlessly peddle the fiction of the American dream, whereas in fact social mobility is now lower than Europe’s. So often we hear of mantras encouraging risk taking in the name of ambition. The financial industry likes nothing more than to entrap us in debt that we can just about service trends up not down with no prospect of full repayment. The likes of Bitcoin and Robinhood only expand such temptation.

 

Legislators do their part too. Consumer protection in the US is threadbare: every time I hear an advert promoting some loan as “almost like free money” I cringe. Governments cannot resist the easy revenue from lotteries and sports betting. Pensions are now personal responsibility rather than tied to employment, further reducing incentives for prudent saving. Then there is the exaggerated feel-good drumbeat of social media and the consequent pressure to be a star.

 

Some of this is good. The Internet has led to a society full of great hustles that only existed for the privileged a generation ago. It is so easy to set up a business, obtain credit and find a niche with low overheads and genuine prospects. The smart can do very well these days.

 

But not everyone can be both smart and lucky, and a losing streak can quickly lead to a place of doom with no feasible exits. Trends of rising gun violence, addiction, suicide and homelessness testify to this growing band of losers. The excellent Nomadland chronicles one common end state. This is by no means the worst-case scenario: many suffer premature death, and feed the US decline down the global mortality league table.

 

The classic policy prescription for this malaise is welfare, in the form of support during periods of unemployment or rehabilitation. I support this, and of course the failure to deal with the prevalence of guns in society is a national disgrace too.

 

But I would also advocate a response more geared towards education. High flyers in finance understand that there is little to justify their exorbitant bonuses than knowledge of risk and odds. It is stunning how little understood this simple concept is in the rest of society.

 

Covid is a great example of this. Everything about Covid comes to understanding a spectrum of risks and odds. We bleat about herd immunity, but there is no such thing, certainly not at a fixed percentage of vaccinated people, only a possible outcome when risks become tolerably low. There is nothing magical about six feet of distance or masks. In some situations (such as a chanting crowd) risks were always high even at twelve feet and masked up, whereas in others risks remained low at two feet and mask free. A vaccine does not confer immunity, only a reduced risk, especially of serious illness. If we understand the nuance of risk and odds, all of this is obvious. But sadly that remains beyond most Americans.

 

I remember a particular maths lesson from when I was sixteen. It was the end of term and the teacher had completed the syllabus and wanted something to entertain us for the day. He chose gambling. Why do bookies make money? It is nothing to do with knowing which horse is more likely to win. It is all about the spread margin factor, something that we can all calculate but few bother with.

 

Consider a three horse race where the offered odds are respectively evens, two to one and three to one. Properly hedged and over the long term, the bookmaker will retain 50% of the total stake for the first horse, 33% for the second and 25% for the third. The margin is a modest 8%. In practice, most margins are more like 20-30%. That is why we all lose and they can afford all the adverts on TV to entice us into their kingdom.

 

Risk and odds are critical to a good life education, but I only learned that lesson because I had a great teacher who found some spare teaching time. There are many good applications in finance. We would all understand insurance much better if we had that knowledge, and the debate about climate change would be much more enlightened, even among so called leaders.

 

This thinking can also help us plan our lives. Taking on debt and some financial risk makes sense in our twenties, when our future earning potential is high. But once we turn fifty we ought to be thinking of paying down debts and finding ways to save, unless we fancy finding more about Nomadland from practical experience.

 

Humanity has made stunning progress, and healthy life expectancy is one powerful measure to demonstrate it. The “All In” society jeopardises some of that progress. Education about risk, at societal and family level, is one way to reduce its corrosive effects. 

Accommodating China

It is astonishing how opinions of China in the West have changed over the last ten years. Hostility has steadily climbed, and now there seems little hope of a change of trajectory. This feels like a tragic mistake to me, one that will harm all of humanity, especially the western nations pursuing the policy.

 

The Chinese people have endured much hardship. European colonialism left its mark and the nation was slow to develop in the modern era. Hostility with Japan was followed by a civil war and then an inward looking regime. Mao did untold damage during the Cultural Revolution, pitting citizen against citizen, murdering many and impoverishing everybody else.

 

Only after Mao’s death were Deng and his successors able to drag the country forwards, and what has been achieved has been truly remarkable. As many as half a billion people, the population of any other continent except Africa, have been raised up from subsistence into a life with substantial modern comforts. Using the GDP type measures preferred by the West’s financiers, China has contributed more than half of global growth during the past thirty years or so. The Chinese are doing something right.

 

Since 1947 China has been following a path labelled communism, but, as far as I can tell, Marx would recognise almost nothing from his manifesto. It is more helpful to consider China in terms of its people, its governance, the apparent goals of its leaders, and the impacts on the populace and the rest of humanity. Some of these are negative, but many seem to be positive.

 

During my lifetime the Western press and politicians have peddled a series of simplistic narratives about China. First they were folksy and backward. I experienced my youth in blissful ignorance of Mao’s atrocities, mainly because communications were so much more limited at the time, and perhaps because propaganda wanted to avoid discussion of atrocities being carried out in our names nearby in Cambodia, Laos and Vietnam.

 

Once China escaped Mao, the narrative moved on, starting with disdain. Just like with Japan, we mocked early attempts to emulate western methods, and were then embarrassed by the ability to learn and even overtake our own standards. A sort of patronising admiration followed, including some do-gooding and some greed, as western companies spied the growing market and decided to take a share of the action. Then the Chinese learned to copy the elements of our methods we were less proud of, such as bullying and stealing and fixing the rules, and we started to cry foul, while still greedily grabbing what we could.

 

Then came Trump and the pointless fight back, lacking any goals or strategy beyond creating sound bites. China’s response has been to become as USA-proof as possible, and who can blame it? Biden’s team are more logical but possibly even more combative, and recent meetings have descended into acrimony. And how can China be sure that Trump, or worse, will not return?

 

It reminds me of the mistakes we all make as parents. Once our children are no longer cute and accepting, but instead demanding and rebellious, our reaction can lack maturity. When our offspring start to mimic our own flaws and to outperform us in other areas, it is hard for us to accept the required change in terms of our relationships. In some cases, we can resort to bullying and restrictions, generally making the situation worse for all sides.

 

Currently, it is hard to read any opinion about China that does not parrot the official negative propaganda. We hear about Hong Kong, Taiwan and Xinjiang without any attempt at seeing the Han Chinese perspective. How is the Chinese approach in Xinjiang more reprehensible to the American approach in Afghanistan, or for that matter towards its own indigenous population? The military build up is exaggerated and not seen as a logical response to US militarism, and explained as against an international law that our own side applies selectively. Economically, China’s inward moves are condemned, despite each step being a natural response to a provocation.

 

It is very sad for humanity. We should remember that the Chinese miracle did more than raise living standards for Chinese people. We all have China to thank for our abundance of cheap gadgets, and, more important, the rest of the developing world was being pulled up by Chinese bootstraps. Now this is all stopping and a new cold war is unfolding. Let us be clear: this is not China’s fault.

 

The silliest thing about the US policy is that it is bound to fail. The western economies are far more dependent on China than the Chinese one is on the west, even before the active Chinese decoupling taking place now. China must work out that military action by the west will surely not be a practical option, and at some point they will integrate Taiwan, thereby also securing dominance in one more critical sector, that of semiconductors. Demographics and education are strongly on China’s side.  Arguably, so is their political model, being more able to mobilise and push through aggressive measures: just look at Covid for evidence of that.

 

This tragedy is wholly unnecessary. I believe that China would be willing to accept a rebalancing of the world order that could lead to growing prosperity for a new generation. It is true that the small cabal of leaders at the heart of the Chinese communist party think first of their own power, but they are strategic and smart, and probably see that their best chance of holding on to power lies in continued development.

 

Viewed from China, external threats are everywhere. Their own shipping lanes are dominated by the US military, and hostile nuclear weapons lie nearby in Japan, Korea and Guam. The US holds the world economy hostage via the dominance of the dollar and overuse of sanctions. Cyber spies are ubiquitous. Increasingly, Chinese students and companies are no longer welcome in the west.

 

The new world order would need to rekindle the spirit of 1947. In terms of governance, a refigured and less skewed UN security council could find respect and be bolstered by international law that even the powerful accepted. Nuclear weaponry and other military spending could be curtailed by a rule that 50% of all new spending must be multilateral.

 

In economics, a true world bank could set monetary policy from a currency that no nation had excessive influence over, and a global Tobin tax could fund items of global importance, most notably climate change, but also cyber security, bioscience and poverty reduction.

 

The toughest nut to crack would be the social side. Neither China nor the US would find it easy to agree to any human rights charter that Eleanor Roosevelt might applaud, and especially not any enforcement mechanism. I would love a world moving towards global free movement, with transitional obligations on migrants towards their new and former domiciles. But I have to concede that we are long way from that utopia.

 

Apart from the social side, I believe China would support a fair new world order, and indeed would be happy to take a leading role in forming it. The EU offers a wonderful template and many effective diplomats. Sadly, the stumbling block is the USA. Biden has to keep at least one eye focused on 2024 and a possible Trump return. But even so, I find it very sad that I find no discussion at all of any alternative to the current unintelligent, imaginative and ultimately doomed China policy. I believe our children will look back on this decade as a historic lost opportunity.  

Why is Violent Crime Increasing?

 I was shocked last month when finally returning to live choral rehearsals in Manhattan for the first time since the pandemic started. It was a joy to ride on half empty subways. But I was taken aback when the conductor asked if anybody wanted to finish the rehearsal early because they did not feel safe getting home.

 

Nobody spoke up, the rehearsal finished at the expected time, and I travelled home on the subway safely. It didn’t feel dangerous to me. But the comment of the conductor gave me pause for thought.

 

The first time I visited New York City was in 1982 as a tourist. I recall how shabby the city was. Walking only two or three blocks from Times Square, I took a wrong turning and immediately felt unsafe, the subject of prying eyes sizing up my potential for robbery. I understand things became worse by 1990, before Rudy Giuliani became mayor, launched zero tolerance, and started the clean up. Coming to live in the city from 2012, I have been a beneficiary. I am not especially careful about where and how I get about, yet I have not once felt unsafe here.

 

New York is not alone. I first lived in London in the early 1980’s, and my landlady in Herne Hill took out an A to Z on my first night there and pointed out various local streets and neighbourhoods that I should avoid. I suspect the need for such caution is much less now.

 

And yet the last eighteen months has seen worrying increases in violent crime in many cities in the developed world. Of course the papers and social media and even the police exaggerate the problem, quoting eye-popping percentages. Why do we overuse percentages so much? If Covid is up 300% in my district I don’t really care if the base line is low enough, yet I have to research in order to discover what that base line is.

 

Still, undoubtedly there is a problem. Gun crime, homicide and violent assault are all on the rise. Eric Adams captured the popular mood to win the mayoral primary. My conductor had been taken in by the scaremongering, but increasing violence is not good, and what if it is going to get worse? It is certainly worth trying to understand the causes.

 

To start to analyse the possible causes of the increase in violent crime requires first trying to understand why violent crime decreased so much in the long period before. Giuliani got things started in a positive direction, but violence has continued to reduce markedly ever since until the recent uptick. And Giuliani cannot take all the credit, because the same trend took root everywhere, including places where zero tolerance never became a mantra.

 

Still, smarter policing surely played a role. Perhaps more valuable than zero tolerance has been the use of technology, with lots of cameras to solve crimes and lots of data to pinpoint neighbourhoods for focused effort.

 

Demographics always play an important role in trends. In the USA, the number of people aged 15-22, the cohort responsible for most crime, decreased steadily since the millennium, but has ticked upwards recently (though it is set to decline again soon). Smaller families offer a second benefit too, because the number of kids growing up in chaotic surroundings will be fewer.

 

Improved education for the most disadvantaged kids must have played a role, as well as other public policies such as rehabilitation of the homeless and those leaving prison and support for children of poor families. The USA still lags in all of these areas, but I can believe that what efforts exist have become gradually more efficient. Other policies should not be overlooked either. It is reputed that lead in the water, formerly ubiquitous, caused young brains to be anxious and potentially more violent. Nutrition does not appear to have improved much, but faltering efforts to reduce salt and sugar, especially in school meals, may have helped as well.

 

Then there is more professional crime. My image of the hardened criminal has changed since the 1990’s, from somebody roaming the streets stealing cars and prone to violence when provoked, to somebody at a computer terminal hacking bank accounts. The latter probably does more societal harm, but is surely less violent. Probably many gangs have taken up less violent methods as well.

 

Hence the context of the recent rise in violent crime is a long trend of reduction, probably caused by a combination of causes, many of which are still in play today. So what is different that might have reversed the trend?

 

The most obvious difference is the pandemic, and the increase in violence seemed to start around about when the pandemic struck. My image here is of somebody becoming steadily more desperate and eventually succumbing to violence. The pandemic has made life seem hopeless at times, and being cooped up in an unhappy home without the social outlets of school or activities must have been tough for many.

 

An extreme example of this came to mind yesterday when I attended a funeral, and the priest told a story about an incident that reminded him of his mortality and led him to think about the really important things in life, love and kindness. We should indeed live each day as if it were our last. But what about somebody in anger or despair? Might such thinking during the pandemic have led people into reckless acts? If life is truly hopeless, how about taking out the partner you have lived in misery with for that last decade?

 

The second factor that has clearly changed since 2020 is policing. George Floyd and the ensuing protests will have made police intelligence and community work more difficult, and some police may be choosing to avoid tough situations for fear of becoming the next Derek Chauvin. In New York, we have one more factor. The start of 2020 saw a major change to the use of bail, which had previously been used to keep habitually violent people locked away in Rikers Island for long stretches, despite not having been convicted. Now more of them are on the streets, and more violence is a likely consequence, however well intentioned the reform.

 

No doubt police practice will find a more healthy balance again over time as wise voices prevail and lessons are learned. The pandemic will pass too. So can we expect the more positive trends on violence to resume soon? Perhaps, but could it also be that the pandemic has simply accelerated a trend that would be occurring anyway? If the latter view is correct, we can expect more violence in the near future, not less.

 

Pessimists might extrapolate from my story of the one whose anger bubbles up until it explodes into violence. It is not only the pandemic that makes this more likely. In the USA, Trump stirred up enormous pent up anger that shows no sign of abating. Social media and popular culture make us believe we can achieve anything, yet most of us cannot. Many may mortgage their future on some hustle, or a self-image, or reckless behaviour, only to see everything collapse. Watching baseball nowadays, most adverts between innings are for sports betting – one more temptation for the unwary. For vulnerable young men, the wonderful march of female emancipation will have made some angrier as well.

 

All these societal trends are accelerating, so perhaps we are in for a prolonged period of more violence. Of course it does not help at all in the USA that guns are so readily available, so the angry have ready means to create havoc. A different possibility is all about gangs and organised crime. Perhaps something has changed recently in that landscape. If so, I have no idea what it can be.

 

The decline in violence has surprised many experts, and there is still much debate about its causes. No doubt the same will be true of the reversal of the trend. There are certainly many possible factors to consider. We might have reached an unfortunate tipping point, or we made simply be seeing a negative blip in a positive story. Let us hope it is the latter.