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Reviewing “Peak: Secrets from The New Science of Expertise”, by Anders Ericsson and Robert Pool

It seems strange to call a book about self-improvement “Peak”. Perhaps the publishers balked at “Uphill Struggle”, though that would have been much more fitting for a tome in which Anders Ericsson – the psychologist behind Malcom Gladwell’s “10,000 hour rule” – and science writer Robert Pool channel the Calvinist spirit to insist that greatness is possible for everyone. So long, that is, as we work at it…

Read the rest on the THE website or download the PDF.

This review appeared in Times Higher Education, 9-15 June 2016

 

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The promise and paradise of austerity

Out online, my review of Martijn Konings’ The emotional logic of capitalism (Stanford University Press, 2015). Here’s an extract:

‘Certain questions dog progressive thought: why, in view of the manifest failures of financial capitalism, is its hold on our society stronger than ever? Why, despite the empirical evidence of foreclosures, vacant building lots and food banks are people unable to see the catastrophic consequences of current economic arrangements? How has neoliberalism emerged from calamity ever stronger (Mirowski, 2013)? Why, as Crouch (2011) puts it, will neoliberalism simply not die? With this slim book Martijn Konings, a scholar of political economy at the University of Sydney, sketches out an answer: that progressive understandings of capitalism have neglected its emotional logics – its therapeutic, traumatic-redemptive, even theological qualities – and failed to recognise our emotional investment in money, our belief in the social role of credit as an ordering, regulatory mechanism, and our need for the redemptive promise of austere, well-disciplined economy… ‘

You can read the rest here

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Cost-benefits and twitter follows: eleven weeks of good stuff, week 2

So far so good. It’s Sunday morning, the second week of January and I’m sitting down to write the second installment of my 11 weeks (or thereabouts) of good stuff. Each week I’ll take a section from the manifesto published in A Richer Life, and post it on this blog with some additional commentary.

As I review the not-very-inspiring viewer statistics for last week’s effort, here’s a supremely appropriate second extract:

And kick our cost- benefit habit. Efficiency is not the only virtue. A society needs justice, and empathy, with all the obligations that go alongside them. It’s too easy, faced with a difficult political decision, to emphasize benefits over costs and take refuge in ‘trustworthy’ numbers and scientific calculations. But when we examine those numbers, they turn out to be politics in disguise. We need conversation and debate over what is best, and best for whom, not what is cheapest; to open up the black boxes of measurements and metrics so that we can see what these metrics really are, and what they do. Cost-benefit thinking is corrosive in our own lives too. If we act only in anticipation of a return, we will all be the poorer, while a society where all contribute will be a far richer place. So go to that team meeting, even though it really isn’t part of your job. Take your friend/spouse/children to the play/film/concert, even though you’ll hate it; they’ll have fun and you may well find that’s enough.

The world has changed a great deal since the summer of 2014 when I wrote those words. The horrors of last year – Charlie Hebdo, our awakening to the ‘existential threat’ posed by Daesh, the attacks in Paris, and most of all, the refugee crisis in the Mediterranean and Europe – have forced a sudden maturing of political discourse. While economics still has plenty to say on the topic of migration – largely positive, as it happens – it is just one of many competing voices: the Christian left, for example, represented by Giles Fraser here, or the Archbishop of Canterbury’s careful association of British patriotism with welcome: ‘In today’s world, hospitality and love are our most formidable weapons against hatred and extremism’. Equally, there is an understandable fear, driven by the shadow of attacks that weren’t, and the ugly violence that manifested itself in Cologne on New Year’s Eve.

Closer to home, just look at the change in political discourse over flood defences. At the beginning of 2014 the coalition government demanded a great hike – a 60% increase in benefits – for every pound spent on flood defences. Following this winter’s deluge, we see the environment agency advocating a holistic approach to flood prevention, and stating ‘people will always come first’.

In fact, in such a climate, there is something appealing about the cool voice of reason provided by economic analysis – a dispassionate assessment of the long-term costs and benefits of any action. But it’s clear for now that there are bigger questions at stake.

We must be careful to distinguish between efficiency as a means of distinguishing between solutions to rival problems, and competing solutions to the same problem. In the latter instance, cost benefit has a lot to say. The problem comes in the assumption of transferability. An absurd example will illustrate the point: let’s say the cost benefit payoff of dealing with floods is better than that of dealing with refugees. There is an economic argument to say that we should sort out the floods first, whatever the human costs. That may sound crazy, but in debates over global warming, for example, it’s more or less what many economists have said. When an eminent American economist says that it’s unethical to invest in climate change prevention projects of uncertain return, one can’t help seeing a politics that privileges the haves of the developed world over the have-nots of those countries like Bangladesh.

But my book isn’t really about policy. I’m concerned about the corrosive effect that cost benefit calculations have on us as people – as persons. I argue that individually self-interested action, often driven by cost-benefit analysis, is collectively impoverishing. Private vice is not, despite what contemporary neo-Smithians like to say, a recipe for public virtue. Not at all.

Cost-benefit reasoning is a mode of thinking that we slip into very naturally, so naturally in fact that thinkers such as Daniel Dennet have argued it to be the only truly natural way of thinking. We are all its victims. Indeed, as I drag myself to my shed on a Sunday morning to write these words I can’t help noticing that the views of last week’s endeavour could be numbered on fingers and toes. Why on earth should I bother?

When I’ve finished the blog, I’ll announce it on twitter. I’m fascinated by the economics of twitter, and particularly the cost-benefits of following others. Being a twitter dilettante (a twittertante? A dilettwit?) I just drop in now and then to see what’s going on, catch up on the news and so forth. My friend and fellow twitterante @cfhelgesson captures the mood of this social media existence nicely when describes his news feed as being like rain: when he’s thirsty he can cup his hands and take what he wants, and when he’s not it simply passes by.

A diletwit like me can only cope with following a couple of hundred accounts, beyond which there is a ‘diminishing marginal return’ on each additional follow. (CF, more industrious than I, follows over 700. I will ask him how he does it.) Thus I am operating a clear-cost benefit algorithm for managing my twitter follows; the costs in terms of missed tweets and time required imposed by following one more person outweigh the potential benefits in terms of hilarity, news, political acumen, feline cuteness and so forth. It’s one in, one out, pretty much.

How then do people rack up 10,000 follows? Surely the cost of keeping up with each of these additional follows will greatly outweigh any infinitesimal marginal benefit? Unless, of course, the game is different; if a user is only interested in building up his or her own following, then the economics suddenly work out very well. There is no cost in any additional follow because one has no intention of paying any attention to anything they do, nor is there a cost for any additional follower. But if one sees value in a huge following the marginal return on each follower is increasingly large. The whole economy is suddenly upside down. (The same applies, oddly, to the business of being super rich. When one is wealthy enough to start buying yachts, football clubs and politicians, each extra dollar becomes worth a whole lot more than the last one.)

If one follows total strangers in the expectation that some of them will follow you back, then following huge numbers is an efficient and instrumental means of generating value, and ‘building an online platform’ as the marketers like to say. I was followed last week by ‘a self-taught photographer and photoshop artist located in Los Angeles’ who tweets gorgeous head shots and theatrical bon-mots to an audience of 11,000, but follows 9,999. Including me. Enough said.

Presumably, not everyone follows back, and that 9,999 number requires careful curation. 30,000 follows to 10,000 followers might look bad; better to keep it level. So every time I encounter a twitter profile following a four figure number, or more, and a matching level of followers I think ‘Aha!’

I’m sure anyone with any level of sophistication regarding social media figured this out long ago – but on the other hand, if they did, why does the following trick still works at all? (Maybe it doesn’t – maybe there is, across twitter, a diminishing marginal return on following for followers. That would be truly ironic.)

I instinctively dislike this game. There are two ways of approaching twitter. The first is as a community, where one can share jokes and articles, strange gifs and pictures of cats and all the other things that make the Internet go round. The emphasis, though, is on share, because sharing implies receiving and participating as well as giving. It involves a certain degree of empathy in as much as one expects that people may be interested in whatever it is that one has chosen to tweet. It involves treating people as worth something in them themselves.

The second is to treat twitter as a gigantic tool for self-aggrandizement: building an online profile, getting famous, driving business, ultimately cashing in. It involves asking people to pay attention to you – to spend their time, their efforts on you – without any sense that you will pay attention in return. That additional follow, your ten thousandth, is a trick, a con. It is a message sent to someone saying ‘Hey, you’re interesting…’ that means no such thing.

Of course, if cost benefit is your only measure of moral purpose, then such a game is completely legitimate. It’s a cheap and easy way to hoover up followers, and you’d be a fool not to. That’s why cost benefit alone is such a damaging moral standard, because it mandates instrumental and collectively impoverishing courses of action. The twitter following game is a synecdoche for a much bigger discussion: we need ways of talking and thinking that transcend cost benefit in our own private lives as much as our public sphere. If everyone behaved according to the rules of the twitter following game in real life, we really would have some problems.

All of which brings me back to the business of writing this blog. If I were driven by cost benefit alone I would have sat in the warm and read the paper, pausing only to follow a few more hundred total strangers. I certainly wouldn’t have spent a precious Sunday morning hunched in the shed, peering at the screen, tapping out words while my toes go steadily numb.

I’d like it to be read, of course. I’d like the number of readers to exceed the number of my fingers and toes (so if you like it, please pass it on!). But that’s not why I wrote it. I did so because I said that I would, and I have a promise to keep to myself as much as to the invisible Internet. I did so because I know some people –CF, perhaps – will read it, and I hope they will like it. Perhaps it will raise a smile here and there.

And finally, I did so because I consume blogs too, many of them very good, and I want to be a genuine part of that community of writers and thinkers. I don’t expect this blog will make me rich and famous, and I’m not building an online platform; I simply believe that the world is a better place for the collective effort of writing decent prose and sticking it online. Because lots of us think that, it is.

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Eleven weeks of good stuff

It’s New Year. The time of December parties, Christmas celebrations, of self-indulgence and sofa-slouching is over. The Hogmanay hangover is easing its vile claws from your frontal lobes. It’s time, as diet gurus and health fads tell us, for the New You; for a booze-free January, a gym subscription, and resolutions that must not be broken in the first few days.

In the spirit of all those thirty-day programmes, I am offering my own contribution to our self-improvement. Eleven weeks of good stuff, or thereabouts.

The epilogue to my book, A Richer Life, contains a Manifesto – suggestions for ways in which we might improve our political discourse, our polity, and our personal lives. Introducing it, I wrote:

‘We are all economists now. Every day we think in terms of cost and benefits, and follow the measure of our own self-interest. In the shops, in politics, even in love, we expect value for money and efficiency, high returns for low risk. Economic reasoning is withering our social and political institutions, and the strategic, instrumental self-advancement that it advocates is corroding our personal relationships.

How can we be different? How should we think, talk and act; what tools should we use and institutions should we build to be better persons? What must we do to live a richer life?

Here are my suggestions. Some are big ideas, and others are things we can each do today. Together, they call for nothing less than an inversion of contemporary political economy: for an economics that is grassroots, not top-down, for trade that is embedded in relationship, and for a world where the claims of capital and property and are not allowed to ride roughshod over the dignity and worth of individuals.’

There are eleven suggestions. Not for any particular literary or aesthetic reason, but simply because I stopped when I had done. Once a week, for the next eleven weeks, I’m going to post each one on my website with some elaboration and comment. I hope they will make you think, and even better, talk. Maybe even act. If you like them, pass them on, tell your friends. If you don’t – fair enough, but I hope you stopped to think why. (If you didn’t, I suggest you listen to Tim Minchin on the virtue of being hard on your opinions).

So here’s point number one.

  1. Let’s cure our obsession with price. We must find a way of speaking about priceless things – the environment, biodiversity, culture, care, relationships, quality of life – that does not depend on price. Putting a price on nature, for example, makes it interchangeable and consumable, an outcome that is neither needed nor intended. Something is priceless, as the philosopher Roger Scruton points out, because we discover its value only through experience and interaction and therefore there is nothing for which it can be meaningfully exchanged. The virtues of a loving relationship are worked out and manifested as we go through life: they defy foreknowledge and transcend price. We must cultivate a political discourse dignified and intelligent enough to recognise the limits of our knowledge and accept the worth of things around us.

Price is often shorthand for knowledge. According to mainstream economic theory, it is the price mechanism that translates our rich and varied preferences into a single currency through which needs can be met. But the logic of the market often takes another step and claims that price is the only way of knowing about something. Virtues which cannot be expressed in price cannot be virtues at all. To say that something is priceless – a work of art, for example – often just means that it is very, very expensive.

Price is all knowing, and that omniscience means that we must be able to see into the future. Possible benefits must be factored into present price, just as the future revenue streams from a new piece of machinery in a factory are factored into its upfront cost. This is how the discourses of contemporary life encourage us to think about the choices we make. A purchase, a leisure activity, a new fitness regime, a new job, a boyfriend or girlfriend – all of these are to be planned as investments and understood in terms of their payoffs.

But Scruton, himself a defender of markets, hits the mark when he says that pricelessness means exactly the reverse: that for whatever reason, we cannot know or understand what these future values may be. The only way to find out is by doing, sometimes putting ourselves at risk in the process. The tendency to price is a tendency to control, a will to power over the uncertainty and chaos that adds depth – delight and despair – to our lives. Who would wish to live like a factory machine?

Accepting the limits of our ability to price things involves a certain humility and requires us to develop other ways of speaking and thinking. There is an argument that putting a price on nature gives it a seat at the table, allowing it to be factored into calculations and decisions. That argument is really an indictment of our own lack of imagination: we have to find other ways of allowing the priceless to speak.

There’s a subtle politics at work in our obsession with price. Prices are numbers and we tend to think of numbers as objective and scientific. But all kinds of mechanisms may be at work in the construction of those numbers. In my book, I talk about the practicalities of finding prices for things that can’t be bought and sold – landscapes and bodily organs, for example – and show how tendentious and political many of these mechanisms are. They are often unfair, too. Once we get into the land of calculation, the person with the biggest calculator always wins; the supermarket’s calculative power and customer data is a hugely powerful tool in shaping our choices. A neoliberal free market enthusiast will argue that the market is the biggest calculator of all. It is, indeed, but not one that is necessarily fair – ability and willingness to pay are not the same thing at all.

Price is a mode of speech available only to those who are able to pay. By taking price as the sole measure of value, we exclude and disenfranchise those who can least afford to be excluded.

Three good reasons to cure our obsession with price.

A well-known brand of cosmetics advertises itself with the slogan ‘because you’re worth it’. These words serve to focus the action of valuing – of worth and deeming worthy – on ourselves, while reducing everything and everyone else to commodities exchangeable in pursuit of our own satisfaction. These For a New Year’s resolution we could try the reverse – ‘because they’re worth it’ – as a justification for any kind of action.

Now that is a slogan I’d like to hear in public life.

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The problem with economics, again

A very happy New Year to all – to celebrate, here’s something from the archives. I wrote this for the LSE Politics and Policy blog in the spring of 2014, just after my book had been published. It circulated for a while, and popped up again at the end of the year as one of the blog’s ten most interesting reads from 2014. I’ve seen it on twitter a couple of times since. It hasn’t gone out of date: the year of horrors that was 2015 threw up so many issues about which economics would have something to say, notably the crises over European debt and migration. With typical humility and understatement I chose the title ‘The problem with economics’. So, without further ado, here it is once again:

‘In my recent book, I Spend Therefore I Am, I claim that economics is itself one of the biggest problems we face today. By economics, I don’t just mean something that happens in universities, but a way of thinking based on and institutionalizing certain assumptions: that we are driven primarily by self-interest, organised by competition, and governed by the calculation of future returns over costs. I argue that the logic of the market has even become embedded in our daily, personal interactions. And I suggest that, as the real challenges for our future – such as the distribution of wealth, global welfare and climate change – cannot be usefully discussed, let alone settled, in those terms, economics itself is in need of some attention.

Judging by some of the reviews, I have ruffled a few feathers. I have been accused, even by the more benevolent, of doing economics a disservice, setting it up as a straw man to be knocked down. In one sense this is true. In the UK, at least, university departments of economics are heterodox, interesting places, housing scholars of all hues: Marxist economists, development economists, and labour economists who work happily alongside behavioural economists and financial econometricians. I freely admit this but it’s what happens outside universities that matters, and the diaspora of one particular kind of economic thought, that represented in economic textbooks, PPE degrees, and the business case justification, is almost universal.

Universal it may be, but fit for purpose it is not. It crowds out other values and leads conversation into a cul-de-sac of squabbles over calculation. In February, a major healthcare institute hit the headlines with the suggestion that statins (anti-cholesterol drugs) should be prescribed to the majority of men over 50 and women over 60, on the grounds that it is more cost-effective to flood the nation with drugs than deal with a tsunami of heart-related health care issues. This may be true but it obscures some more pressing questions: should we eat less, eat better, spend more time out of the office, and be subjected to less stress? Is there something fundamentally wrong with the organization of our society of which heart disease is just a side-effect?

The economist’s answer is that we just need better (read more complex) models. But ceding authority to models rob us of the ability to talk about what we should do, or even to recognize that the best we can do is far from good enough. If we object to contested and complex models sitting as unelected legislators in our parliament, then more sophisticated models will simply worsen the situation: more sophistication equals less transparency and less opportunity for the lay-citizen to contest the models’ judgement.

This kind of economics is ever present in our public discourse. It appears when we ask what we should do about higher education or the flooding in the South West. Government officials charged with looking after culture are obsessed by the Treasury’s Green Book and preoccupied by the thought of market failure. The way that we talk tells us what counts and what does not and helps us assign value to certain things. But talk alone is not enough to ensure the dominance of economics in our public and private lives. For that we need economic things: models, tools and organizational architectures. It’s not a metaphorical ploy to suggest that economic artefacts are active legislators in the world around us. The complexities of arriving at a decision in the modern world force us to share the burden of calculation with devices, which become, in the words of the French sociologist Michel Callon, ‘prostheses’ for economic action. These things do. They act in the world and our agency is shared out amongst them.

So, for example, when one adopts the methods of the Green Book, or switches on an investment bank trading screen, one takes up calculative tools in which certain economic assumptions are embedded. The discounted cash flow, central to business case analysis, produces in the world a very particular set of effects with its roots in economic theory – the diminishing value of money (and sometimes persons) in the future. Philosophers may be less than happy with its assumptions (how can one discount a life?) but every day in offices and trading rooms around the globe, the discounted cash flow really does make the world into a place where the future is worth less than the present.

Often, economic devices are naturalised such that we often don’t notice their effects. Let me offer another example. My colleague Shiona Chillas and I have spent some time investigating the mechanics of online dating sites. We have been able to trace the progress of particular economic ideas and methodologies into the construction of dating algorithms and interfaces. When a user enters the site, they form a temporary partnership with the machinery and act in a certain way, to maximise return on their own value. Our findings align neatly with the substantial body of research on the tactics of users on the sites: they become economic, they shop, they maximise dynamic preferences. Some sites analyse previous searches and show you matches according to your ‘revealed preference’. The machine knows you better than you know yourself, so long as you choose a partner as you might a pair of trousers. Under these conditions, it’s impossible to maintain the fiction that a user’s choices are not shaped by the site’s mechanics, when the machinery does so much of the work. Nor is it much of a defence to claim that the school disco was also instrumental. It may have been, but the cybernetic rationality of online dating is something else altogether. We don’t know for sure how much of this cyborg dater spills into the world around us, but I suggest that the prognosis is not benign.

Many will agree that our economized public discourse is lacking. But examples like online dating, healthcare, and the grimy world of Punternet (an online review site for sex workers, promising that better information will lead to ‘less stressful, more enjoyable and mutually respectful visits’) encourage me to push the argument a little bit further. Economic rationality is powerful, and in its thoroughgoing solipsism it drives out other virtues: if we must only care about ourselves, how can we possibly care about others? When we reduce our interpersonal relations to calculations of cost and benefit, disciplined by competition and mediated by the manifold devices of economics in the world – the same discipline that we must focus upon ourselves – then we run the risk of losing something far more precious: our humanity.’

Happy New Year to you all. I hope 2016 brings us all good things.

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Review: The Dark Side of Management

Just a quick update: my short review of Gerard Hanlon’s ‘The Dark Side of Management: A Secret History of Management Theory’ newly published in Times Higher Education. Hanlon wants us to rethink the old Frederick Taylor bad/Elton Mayo good divide. Taylor, of course, invented scientific management and worked to increase the efficiency of production by cheapening labour as much as possible, taking the need for skill or judgement from the workers and passing it to a new class of managers. Mayo, on the other hand, is often seen as being on the workers’ side, his interviews and coaching designed to help people identify with their job and become happier in it. For Hanlon, scientific management and the Mayo’s new human relations movement are just two sides of the same coin: it’s all about making more money for capital. The historical material in Hanlon’s book is interesting enough (though Harry Braverman’s seminal 1974 account of Taylorism as the bedrock of the labour process is strangely absent).  But I think there are some more compelling stories about exploitation in the twenty-first century begging to be told. Well, here’s the review if you’re interested.

21 February: Article scan available here OHanlon THE 030115.

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Tell Sid and get on yer bike: the panoptic world of the private investor

My article ‘Elephants can’t gallop’: performativity, knowledge and power in the market for lay-investing was published in Journal of Marketing Management earlier this year. The JMM team have been kind enough to remind everyone with a tweet – thank you! – so in return, here is an extract from my book A Richer Life. It is a discussion of private investors taken from chapter 4  Making Economic Man and it sums up the key themes of my JMM paper. If you want the Foucault-inspired analysis in full, you can find the article here.

***

‘Margaret Thatcher did not only sell off housing stock. She also turned thousands of individuals into shareholders through a series of massive privatizations. The wave of deregulation that she brought in to break up the sleepy monopolies of the City, known at the time as the ‘Big Bang’ of October 1986, opened London up to the brashness of Wall Street. It also made it possible for the ‘man in the street’ to buy and sell shares. In a few short years, Thatcher created the private investor.

In the United Kingdom, privatization was fronted by the iconic ‘Tell Sid’ advertising campaign, a pre-social-media take on a viral advertising message: a postman is knocked off his bicycle by an Everyman character, fresh from the pub, who says, ‘I’m glad you’re here, this will interest you . . . these British Gas shares, they come out in November . . . If you see Sid, tell him.’ The postman relays the message to an elderly lady, with the additional flourish, ‘They’re really easy to do . . . if you see Sid, tell him.’ The name Sid was well chosen, with its connotations of lower-middle-class solidity, the same staunch Thatcher supporter who had bought his own home not so long before, and at the weekend polished his beloved Ford Sierra to a perfect shine.

Private investors have always puzzled people who know about finance. They don’t seem to do very well in the market, systematically underperforming the various benchmarks. In all fairness, most professional investors underperform the benchmarks as well, but that is an aside: private investors get dismissed as dumb, or reckless, or worse. Habits such as overconfidence drive returns down (men are much worse offenders than women here, and it costs them an additional 1.4 per cent a year in lost revenues).14 But they persist in investing. Why?

As a doctoral student I set out to explore this riddle, one of which I had some personal experience. I had worked briefly as a stocks and shares journalist during the Internet boom years and ensuing bust; I had ended up on the board of a small quoted company that specialized in providing information on other small companies. It also specialized in spending shareholders’ money more quickly than it made profits, and I walked the plank after just a few months at the helm. Nonetheless, that period gave me an insight into the world of the private investor: not dumb, not stupid, possessed of a solid pot of capital that had usually been acquired through a successful career somewhere else. Yet they were still investing in small companies like the one I worked for and the others I knew; two-bit outfits where good ideas and dreams could rapidly sour to losses and disappointment in the cold reality of commerce.

So I spent time with a clipboard, I conducted interviews and hung round investor shows. I discovered – and I’m pleased to say that others doing similar research in the United States and Australia at the same time drew similar conclusions – that private investors live their investing lives in a panopticon-like, self-contained world that directs and manages their investing habits. The same techniques, artefacts and devices that make it possible for individuals to participate in stock markets configure them in a particular manner, for better, or for worse; what it is to be a ‘private investor’ is inseparable from the world that they inhabit.

Their story was nearly always the same. People became investors because they were fed up with the poor performance and fat fees of the ‘so-called professionals’. They sought to take responsibility for their own financial destiny, pulling their savings and investments, sometimes even their pension pots, out of mutual funds and embarking on a journey of financial self-education. Their projects are a manifestation of Thatcher’s enterprise culture, which, in the words of the eminent sociologist Nikolas Rose, ‘links up a seductive ethics of the self, a powerful critique of contemporary institutional and political reality, and an apparently coherent design for the radical transformation of contemporary social arrangements’.1 And so they venture to go it alone. Once the step has been taken, they are sustained by a pervasive narrative of ‘us against them’, of outsmarting the financiers with their ‘hundreds and hundreds of highly paid investment analysts . . .’1

Learning to invest is no easy matter. Before embarking on a career in finance one is expected to go to business school and learn the basics of asset pricing and portfolio management, but no such arrangements exist for private investors. Instead, you must educate yourself by attending investment shows, reading magazines or books, browsing online and chatting to others in the same position. Investment websites are thriving communities of chatter where individuals can share ideas, discuss strategies, celebrate success or commiserate over failure; the relationships formed with electronic others often do more to sustain investment practice than the real-world attachments they build up in shows and seminars. In this way investors learn how the market works and how they should understand it, and at the same time they purchase mechanisms for making the market visible and tractable. They may be ‘chartists’ who chase Fibonacci numbers through the financial market, or ‘fundamental’ investors hunting down hidden value in the smaller company markets; in either case they pay fees, subscriptions and commissions, and in return have the burden of market calculation lifted from them, enabling them to participate in the market.

As one might expect, there is nothing extraordinary about the technologies of governance that surround private investors. Some of them purchase computer programs that will analyse investment opportunities or draw elaborate graphs of share price movements, while others subscribe to tip sheets and magazines. Still others visit shows and speak to the management of firms seeking investment. Nevertheless, these mundane technologies, programs and artefacts enforce very particular ways of behaving in the market. Calculation is embedded in each of these devices, and serves to configure the investor who uses them in a specific way. Subject to this technology of self-entrepreneurship, they become not just economic men and women, but specialized economic men and women, positioned to offer maximum advantage to their curators – not the investors themselves but the owners of the technology that they use.

For example, one investor, whom I shall call Terry, told me about the magic numbers that he believed shaped the seemingly random movements of prices:

Fibonacci ratios exist everywhere, they exist in art, they exist in the human body. If you measure the distance from your shoulder to your ankles, and then you measure the distance of your arm you’ll see that that is a Fibonacci ratio, I think it’s about 1.618, or .618, or your arm is a ratio of your body.

How does one discover such a complex code among the noise of stock market prices? It is, of course, invisible to the naked eye and the investor who wishes to find Fibonacci ratios must spend plenty of real money in the course of his pursuit. When I spoke to him, Terry had already spent thousands of pounds on training CDs, charting software and attending courses, and had invested most of his spare time for nine months on testing out new methods, with the hope of becoming a full-time investor in the near future. When one method disappointed he simply moved on to another, claiming that his system was not yet quite perfect and ignoring the other equally plausible explanation: that there are no magic numbers in the stock market, or at least, none magic enough.

The institution that surrounds private investors is so total that they are unable to see beyond it. The promise of the self-reliant, entrepreneurial future hangs in front of them, and combines with the sense that it really is their responsibility to improve their lot, to provide for themselves in old age, to take charge of their destiny and shape it accordingly.

Another told me in all seriousness that while he invested successfully in dividend-paying multinational corporations on behalf of his mother and his sister, his own investment activities in smaller, high-risk companies had ‘always been a disaster’. When I pushed him as to why he kept on with this investing he replied that if he could just erase emotion, if he could act rationally, then it should be a good way of making money.

Private investors are outgunned on all sides by sheer calculative power: trapped between the professional investors with huge reserves of capital and ‘all those PhDs’ on the one side, and the investment service firms who will charge fees whether they win or lose on the other. Why do they continue in the market? Mental accounting, such as separating gains and losses, for example, and simple self-deceit carry a fair share of blame. I often heard statements such as ‘excluding the bad ones, I did quite well’, or ‘the professionals had manipulated the market’, or ‘the very day I was intending to take profits, it collapsed’. More pernicious, though, was an underlying sense that the golden egg lay just round the corner, that success was only a few tweaks to the system or minor adjustments to strategy away, that it was the investor’s fault for getting emotional, or attached to a share. The possibility of riches and success, or the idea of working on a laptop from a poolside at your tropical retreat, are strong enough to blind investors to the grinding reality of financial loss. The more exotic the product, the higher the risk, the stronger this motif of eventual breakthrough and escape became. Only in one instance did I hear an investor express any doubt in the possibility of making money from one particular branch of investment activity. And so, he told me as he sipped thoughtfully on his beer, he was becoming a chartist instead.

Interviewing people can be difficult. The dispassionate social scientist is not allowed to interfere, even when the pleasant man you are talking to tells you he is moving his pension fund into a spread-betting portfolio. And if I had rebuked him, he would probably have replied that professional fund managers had eaten up so much of his money already, he would rather lose the rest himself. I would have struggled to answer that. Private investors find themselves in a panopticon much more insidious than that of the fishermen; their aspirations, energies and personal savings tied into a system in which it seems they lose whichever way they try. There are some decent firms in the investment service sector, and I’ve worked for one of them, but no amount of decency can diminish the fact that there is a huge structural problem: individuals, failed by mainstream finance, are forced to fend for themselves in an unfriendly market where they become the prey of those very same financial institutions. Moreover, this arrangement is offered to us as part of a social settlement where we are expected to consider ourselves liberated and empowered in making arrangements for our own old age.’

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‘Reorganizing growth’ – lecture in Cologne

Organization, growth, faith, prosperity – what a fascinating and tangled nest of concepts they are. So when I was invited to speak on just these topics, in Cologne, of course I accepted. The conference ‘Ihr aber glaubet’ was held on 12-14 June, and funded by the German Federal Cultural Foundation. My thanks to everyone involved, to those others in my session – Marcia Pally, Christian Felber, and Wolfram Eilenberger (editor-in-chief, Philosophy Magazine), who moderated the debate so effectively. I’m publishing my lecture below; its a ‘long read’. If you’re interested, here’s a running commentary on the session, ‘Making sense of Pally, Roscoe and Felber’.

“Good morning. First of all, let me say what a pleasure it is to be here and to have the opportunity to speak to you at the beginning of what promises to be a fascinating two days. And also, to admit that, to my shame, I speak no German. Perhaps the reason is my own idleness at school, or that my many German friends have always indulged me in my own language; the fact of the matter is I’m going to have to speak to you in English, and for that I can only apologise.

Many years ago, while I was a master’s student among the dreaming spires of Oxford, I had the good fortune to edit and translate two chapters of an ancient Arabic manuscript. It had been written by an Alexandrian physician called Abd al Latif al Baghdadi, and was a gloss on the work of an earlier Greek commentator, himself paraphrasing Aristotle. It had been stored in the library of a Turkish monastery for hundreds of years, copied many times by hand, and was enough to make a young student’s eyes water. This manuscript (right) was all about ‘tadbir’ or Providence. Manuscript

Since mankind’s earliest intellectual adventures we have sought reassurance that the world is ordered by something other than ourselves. The ancients thought that the world was at the centre of the universe, and imagined a set of celestial spheres sliding one upon the other, ever less changeable and more perfect, moving away from the chaos and disorder of the world until eventually one reaches the untouchable heavens, the fixed stars, the realm of the divine soul. According to Abd al Latif, Providence, a divine power emanating from the perfect heavens, seeped inwards to organize the earth; things live and breathe, think and talk, on account of differing measures of the divine soul. It is the fundamental animating, organizing force of nature.

I would like to say that things have moved on a bit since then. But when I read Hayek, for example, who suggests that the natural order of crystalline structures is somehow a model for the organisational structures of a free-market economy, I wonder if we have just swapped one set of beliefs for another. We still seem to need the reassurance of divine order, and to be able to place our faith in something beyond our own everyday experience. For the last few decades, that faith seems to have centred on markets and economics.

It is the consequences of that faith – in terms of our humanity – that I would like to talk about today. I want especially to talk about growth, an idea that is so closely linked to economic prosperity. Growth is expansion, proliferation, there being more of something today than there was yesterday. I won’t get clever and say that growth can be spiritual too. But I will suggest that growth can be pointed in different directions, and have different consequences; in this talk, perhaps I can sketch out a vision of growth that offers more possibilities for humanity.

Adam_Smith_The_Muir_portraitAnd faith: well let’s get to faith now, and back once again to providence. The notion of providence is more closely entwined with modern economic ideas than you might think. You will know that Adam Smith (left), philosopher, man of letters, economist, and pillar of the eighteenth-century Enlightenment, breathed life into the idea of self-interest as a motivating force in society. In The Wealth of Nations, published in 1776, he told us it was the self-interest of the baker, brewer and butcher that would provide our supper, not their innate kindness or charity. (Although, as feminist author Katrine Marcal has pointed out, Smith lived at home and was fed and watered by his mother). Smith argued that mankind had a ‘propensity to truck, barter, and exchange’ and that he was distinguished from the beasts, not by the gift of stewardship over the earth, nor through being made in God’s image, but by our ability to exchange. Smith’s understanding of the division of labour as the source of wealth has proved so influential that it adorns the Bank of England’s £20 sterling note. But his understanding of people is even more persuasive. Trade makes us what we are, he says, and if you need something from someone, you had better rely upon their base self-interest, because that’s the only thing you can trust.

The enlightenment, of course, sought to do away with the dead hand of religion, looking forward to a better society, one driven by progress and illuminated by science. In the enlightenment, nature took on the mantle of providential organiser, and acted as the mirror of the divine in a more secular worldview; Smith believed that nature, if left to its own devices, would channel economic activity in the most beneficial manner: ‘By directing that industry’ he wrote ‘in such a manner as its produce may be of the greatest value, [the businessman] intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.’

Smith’s name regained prominence in the 1980s as the champion of free markets, the classical economist who first pointed out the ‘invisible hand’ of the market, which became the best, if not the only, justification for notions like the trickle-down effect: the idea that a healthy market will, left to its own devices, self-regulate and turn competing self-interests into wealth for all. Those free market evangelists of the twentieth century took Smith’s name in vain: he is less advocating untrammelled self-interest, than making a theological point about the immanence of divine intention in nature, and therefore in the world. He isn’t really saying that you can only trust the baker’s most base instincts. He’s saying: what a wonderful world we inhabit where even the lowest instincts can produce such virtuous outcomes as our supper. For the Enlightenment thinkers it was nature, not scripture, that offered mankind comprehension of the Divine; the laws of heaven were written into the laws of nature, and thus into the wonderful, ineffable operations of the market.

So Smith, and those little Smithians who follow after him, believe that a particular kind of human relationship is central to human well-being and progress. Not one of kindness or generosity, altruism or imagination, but one based upon self-interest and competition. Private vice, they say, leads to public virtue. Self-interest provides the motivation for any action and competition the disciplinary mechanism. By this way of thinking, the more interactions are colonised by economic exchange and given over to self-interest, the better society will be. In 1956 the British economist Dennis Robertson argued that job of the economist is to economise on love, to make sure we rely on self-interest to organise society; we mustn’t carelessly use love up, or there won’t be any left when it is needed. I’ll leave that point for now. I’ll just say that growth doesn’t just involve the growth of wealth, but also the proliferation of ways of doing things. Growth in wealth seems to mean growth in markets and therefore growth in market-based relationships. And so growth becomes intimately linked with another question: how best should we organise society?

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In parallel with the history of faith in markets and economy, it is possible to tell another history – of the growth and proliferation of commodities: a history of wealth and accumulation. That history would chart the move from the village-based craft production of goods, through the growth of trade in the Middle Ages, to the coming of industrialisation and the birth of the manufactured commodity. In the present day, it would deal with the new frontier of production and accumulation that is the digital world.

Of course, wealth has always been associated with status and accumulation. Rereading Homer’s Iliad, I was struck by the importance that the circulation of artefacts plays in the story and the obsessive, fetishistic detail with which the poet describes these goods: swords, shields, helmets, tripods and cooking vessels, armour, chariots and plates. Our concerns haven’t changed much since then. There doesn’t seem much difference between ancient Odysseus and modern day James Bond: both black-hearted, cunning, lucky with goddesses, and decked out in the best and most expensive ornamentation. If Omega had made watches back in the days of heroes, I’m sure Odysseus would have worn one.

In mediaeval times, most wealth was in the shape of weaponry and land, which conferred advantages of power on whoever happened to hold them. Then, as trade bloomed, a growing merchant class used precious goods – buildings, cloth, art, spices, even sugar – to demonstrate their status and equality with the landowners. Later still, during the Industrial Revolution, commodities became mass-market, and the growth of wealth began to accelerate. Material status symbols were no longer the preserve of the wealthy elite. The 20th century, particularly after the Second World War, saw the rise of consumer culture, a boom in production and consumption driven by technical advances and petrochemical exploitation; the great democratisation of wealth, the proliferation of stuff, a social contract that dreamed of equal economic participation, and after the fall of the Berlin Wall, the final triumph of free-market capitalism and claims of the ‘end of history’.

But it wasn’t the end of history at all, not for growth and accumulation. Digital technology, the Internet, and social media have opened up incredible new possibilities for the production of commodities and the accumulation of wealth. The early Internet evangelists argued that digital technology would cut out the middleman, and put producers directly in touch with consumers; instead, we seem worse off than before. We have giant, monopolistic gatekeepers, taxi firms that don’t run taxies and bed-and-breakfast brokers who don’t hold a single room, each worth millions of dollars.

There are new forms of labour, unpaid and invisible. In class I ask students how many hours they spend on Facebook or YouTube. It’s a lot. Then I ask them who is getting rich? It’s certainly not the students, though they seem to be doing all the work, creating, organising and consuming content. The digital frontier has become a wild west of wealth ready to be grabbed; instead of gold there is personal data and the unpaid labour of children, students and the unemployed, in fact anyone with time available to spend labouring online.

It is ironic that such new forms of work are tagged as liberating, aspirational and entrepreneurial. Despite hopes that the Internet would lead to community, sharing and even new kinds of civic virtue, it has turned into yet another competitive arena where participants fight to capture the benefits of communal activity to their own advantage. YouTube, once upon a time a service for collective video sharing, has become a space where would-be celebrities, many of them children, work hard to develop content and find subscribers. Once again, layers of middlemen have appeared to shackle these youngsters in contracts and take a cut of their already pitiful earnings.

Or consider the business of ‘modding’ or hacking new games, which takes place in communities of amateur software programmers, deploying their skills for the love of the task and the reward of community acclaim. Software firms have been quick enough to recognise the process as one long, free job interview, and periodically hire the most successful programmers. Now that success is defined in terms of getting a job – that is, in tangible monetary terms – the borrowing that goes on from other programmers in order to make a successful ‘mod’ is less an act of communal sharing and more one of snatch and grab. And to be honest, I’m doing something like that just now, because the example I’ve given you isn’t mine, but comes from the sociologist Detlev Zwick, now based in Canada but originally trained in this fine city.

So growth doesn’t just mean the accumulation of wealth. It also means an expansion of doing and valuing according to the rules of the markets. Growth, thus understood, may leave us financially rich but impoverished in so many other, less tangible, ways. All of this, of course, is the Enlightenment dream being put into practice: an ever increasing proliferation of commodities, even more expansive frontiers for growth and accumulation, and ever more human relationships being turned over to instrumental, trading exchanges driven by self-interest and policed by the providential mechanism of competition.

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The final commodity is, of course, our own selves. Let me give you another example, one that exemplifies everything I have talked about: the entrepreneurial capture of yet another area of our social life, the commoditisation of persons as a tradable product, and the subsequent replacement of a pre-existing pattern of social relationships with ways of doing and valuing demanded by the market. I’m talking, of course, about online dating.

Since the birth of the Internet, online dating has emerged as a serious commercial force and social phenomenon. Global online dating firms turn over hundreds of millions of euros every year. They promise, well, that’s the point, what exactly do they promise? Some promise scientific methods which can help you find your partner for life. Others promise to help you find someone who is right for you, who shares interests, someone with whom you can enjoy your hobbies and activities. Still others promise to find you a woman or man in uniform, or somebody who went to the same university as you, or reads the same newspaper. Whatever you fancy, that’s up to you – and that’s the point: reengineering love as a consumer choice makes it something that can be parcelled up and sold. Love, which is so central to happiness, self-knowledge and even faith, is reduced to the status of a tradable, exchangeable commodity.

But how exactly does this happen? As is often the case, human relationships can be turned on their head by a little bit of machinery, a few measures and incentives. So, for example, many online dating sites allow people to search for potential partners using a mechanism that will be familiar to anyone who has ever used the Internet to search for a second-hand car or a house. These interfaces offer a detailed menu of choices, allowing users to select partner attributes such as age, height, type of figure, hair length, hair colour, interests, marital status, ethnic origin, religion, education, children, and where you stand on drinking and smoking. I am not, by the way, betraying any prejudices when I list hair length and colour before education – that’s how they appear on the screen, and, I suspect, a suggestion of their perceived importance. At the top of the screen, a counter lists the availability of matches. It tumbles downwards as you design your perfect partner online, until eventually, you must trade off desired characteristics and scarcity.Search screen

How does a user behave when presented with such an interface? There is no alternative but to try to maximize one’s preferences in searching for a potential partner. We seek the best that we can get from the available supply, making decisions as to the relative merits of available attributes and their value against our own. A kind of market-economic behaviour has been brought into being through the use of a technical interface. The user, in combination with the dating website, has become the individual economic agent, the instrumentally rational, maximizing actor of economic theory: a cyborg dater. Hang on, you say, isn’t economic man selfish, instrumental and even strategically dishonest? If we want evidence that online dating changes the way people go looking for love plenty has been provided by researchers in psychology: individuals go armed with a shopping list of perfect partner characteristics to be ticked off; people are prone to petty dishonesties in their self-descriptions, getting slightly taller and a little bit thinner; and skimming through endless profiles fosters the illusion of choice and lowers commitment. We hear plenty of stories about selfish men (I’m afraid it usually seems to be guys) online; but the evidence is that the online systems bring out the worst in people. Online dating isn’t even fair, at least not in the sense of equal opportunity for all. We’re not terribly good at finding people who are attractive to us in person by looking at photographs and profiles. Instead we tend to pick on people who are ‘generically’ attractive and they become immediately popular online at the expense of everyone else.

Online dating demands that we treat falling in love as a moment of active and rational choice, where personal attributes and compatibility form the basis of attraction. But people are not like a fine wine or a holiday; they are not things to be selected and ‘experienced’, as dating services would have us believe. Experiencing is a self-centred occupation, and a glass of wine serves no purpose beyond the temporary gratification of the drinker’s senses. Flourishing human relationships, on the other hand, are mutually rewarding, ongoing endeavours.

I do understand why people look for love online and I’m genuinely happy for anyone who builds a long and loving relationship from the flimsy start that an online match offers. The point I’m trying to make is a more general one – that human relationships organized by market exchange are instrumental, self-interested and solipsistic, and therefore inferior to those organized by service to others, sharing and empathy. You could put that even more simply. Does the good life involve getting more and more of what you want, or is it achieved in relationship with others? Or even, as the Christian tradition might put it, in service and devotion to God?

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So back to faith. Faith offers a means of placing oneself in the world. In contemporary politics we can see more than just the pursuit of growth and accumulation. There is a quasi-religious belief in the ordering power of markets, in the justice of economic action, and in the ability of the system to distribute wealth where it is most deserved. You can follow, as I have done and in this talk, the parallel development of ideas about the spontaneous organisation of markets and the accumulation of commodities and wealth. Markets are the mirror of nature, and therefore of God; from the delicate balance of the world we can deduce the moral righteousness of economic growth. But it does not look as if the current arrangements are sustainable, either in terms of the planet’s capacity to support unlimited growth and production, or in terms of generational and geographic equity, when those who find themselves comfortably off do so at the expense of younger, future, or foreign others. It seems that blind faith in the providential ordering of growth is as fanciful as Abdullatif’s long dissertation on the heavenly spheres.

A little while ago I mentioned the economist Dennis Robertson, who claimed that we must economize love, in case we run out of it when it is really needed. Michael Sandel, the Harvard philosopher, has an answer for that: love, or altruism, is a habit that flourishes with practice. A little altruism, carefully applied, should lead to a little more, a virtuous circle of benign, non-instrumental social relations. But how to kick-start such a virtuous circle? I would like to encourage everyone to think nice thoughts and suddenly become altruistic, but I suspect we might need a little help, and, as someone who researches organisation my thoughts naturally turn in that direction. We can certainly organize for misery, so surely we can organize for happiness and fulfilment too. Markets are not in and of themselves bad things, so the challenge is this: can we build markets, or other such economic structures, that deliver riches to the soul, or to the community, rather than to the pockets of a few? Can we occupy economics and repurpose growth?

Juan Pablo Pardo-Guerra is a sociologist at the London School of Economics and a fellow student of markets. He has been struck by the radical programme of synthetic biology, which aims to produce toolkits and building blocks that will allow anyone to build novel biological structures, and wonders if the same rules could be applied to markets. Imagining markets based on, and coupled to, biological systems could result in markets that are, in his words, ‘pragmatic, even civic’ – Pardo-Guerra envisages a hacker-paradise of self-contained, made-to-measure markets able to tackle specific problems and bring about certain ends: the conservation of the rhino, for example. Would it be possible, he wonders, to construct a market that wraps up and destroys the trade, one that changes social norms so that it strangles itself on its own success?

Let me offer an example of an economic form that does, I believe, just what Pardo-Guerra intends. It doesn’t solve the problem of the rhino horn, but it does confront another problem, one closer to home: the contemporary town. A place where no one knows anyone else, where some leave for work early and return late, where others remain isolated at home, perhaps old or infirm, or unemployed and marginalised. A town whose residents are disenchanted and alienated, and where relationships have been permeated by instrumental, selfish behaviour and casual competition. Would it be possible to imagine a market capable of rejuvenating a social space? Since the 1970s, some radicals have thought that it is. Their proposal comes in the shape of the local exchange trading scheme.

The principle of the scheme is simple enough. Members advertise services, skills or produce that they can offer, and others that they would like to receive. Usually there is some kind of directory and members contact each other to request whatever it is that they want. They agree a ‘price’ in the scheme’s notional currency, and the transaction is recorded by means of a cheque or an online system. All of which sounds very economic, with its talk of bargains and cheques –and that is doubtless the point, as these schemes are an attempt to subvert and re-purpose existing market arrangements. The big difference comes in the agreement of the price. This is based around the amount of time it takes to provide a good or service: three hours of one service costs the same as three hours of another, irrespective of the nature of the service or who provides it.

The equivalence of value and time is a foundational principle of any such scheme. Organizers understand that there is something fundamentally liberating about pricing everybody’s time at the same level; the unemployed, economically excluded individual is valued the same as the wealthy professional, no matter what service or product is offered. By participating in a LETS transaction, each individual actively recognizes the value of the other in a communal exchange.

Sceptical observers will point out that the success of trading schemes is mixed. It’s true. Even successful ones tend to collapse under the weight of the bureaucracy required to manage them. The experience of those participants I have spoken to is that schemes eventually peter out. Does this mean that they are worthless? I don’t think so. Local exchange trading schemes offer a window onto a new way of organizing markets, one that highlights the role of trust and empathy in economic exchange, and makes it possible to imagine that economics could be different: that it could be an economics for us, locally organized and productive, and one which we control in a very local, specific way.

It may even be that a local trading scheme is exactly the kind of hacker-paradise-market that Pardo Guerra envisages, self-contained and for purpose. That any trading scheme is a necessarily short-lived thing, with the seeds of its own demise sown in its success. For once the scheme has succeeded in establishing trading relationships among people who were previously strangers, the bureaucracy is no longer needed, and the scheme wastes away. It leaves in its place a community.

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I have argued that the growth of market-like ways of doing and thinking, which has accompanied the economic growth of the last 30 years, corrodes our interactions and somehow robs us of capacities as humans. But markets are here to stay. So perhaps what we need is not less markets, but better markets; not less growth but better growth.

Now, I don’t imagine for a moment that a few well-meaning people swapping homemade jam for lawn-mowing, or cat-sitting for elementary Mandarin lessons, constitutes a prescription for the overflow of global capitalism. But, in an age when the possibilities of growth seem to have been captured by so very few, I do think that such novel forms of organization may offer us a way forward. Wouldn’t it be wonderful to imagine specialized markets that could build communities, work for fairness and inclusivity, and, most of all, become spaces where altruism could be developed and worked on. Where, turning Adam Smith on his head, public vice leads to private virtue. In structures such as the local trading scheme, each exchange reanimated with social content, perhaps we can begin to glimpse a language and vocabulary robust enough to sustain us into the future: aneconomics filled by dignity, compassion and humanity. A kind of growth that is decent, meaningful, and ultimately human.

Thank you very much.”

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Mr Miliband not ‘leadership material’? That suits me fine

I’m not well qualified to write about politics, but I do have a professional interest in chief executives, and one thing is clear to me: you wouldn’t want a CEO running your country. Not a heroic corporate leader of the sort that business schools have been churning out for the last two decades. Nor, I think, a chief executive of the careful, bean-counting variety, very good at balancing the books; someone who talks shareholder value and tough choices as factories close and food banks fill up.

When someone says Ed Miliband isn’t leadership material, they really mean he isn’t CEO material. It’s true, he isn’t. He lost his footing as he walked off the stage at BBC Question Time. He eats a bacon sandwich in a funny way, and his face moves around when he’s thinking. In short, he seems a pretty ordinary chap.

You can’t imagine Richard Fuld, formerly of Lehman Brothers, tripping on some stairs. But then, Fuld went out of his way never to be seen on stairs at all. He lived a life of chauffeured limousines, personal jets and private elevators; you’d expect Fuld to catch a magic carpet rather than use his own legs.

When most people make mistakes, they slip, stumble, or struggle with a sandwich; a missed deadline or bureaucratic error, something that can be put right easily enough. Chief executives, however, make mistakes of Olympian proportions. The chief executive slips up, and everyone pays, sometimes for decades. When Fuld’s testosterone-charged, corrupt Lehman Brothers imploded it very nearly took the global financial system with it.

Why should this be? How can a chief executive’s capacity for disaster be so exponentially greater than our own? Why doesn’t someone, somewhere in these globe-circling corporations waggle a finger and say, look, Sir Fred, if you do this much more you’ll be the most hated man in Britain for a decade?

Part of the problem, I think, lies in the ‘charismatic’ management style often seen in big corporations. By this account, chief executives really are something special. They’re godlike individuals, possessed of unique moral and intellectual skills, and personally responsible for every success of their corporation (though, remarkably, almost none of its failures). Management gurus peddle this kind of nonsense all the time; I’m not joking about the God stuff either – if you’re interested and have an hour and some to spare, here’s guru Ken Blanchard explaining how to ‘lead like Jesus’.

Or take the late Steve Jobs. No need to say more.

No one is allowed to question, or to puncture the chief executive’s bubble. The smallest misdemeanour can lead to tantrums and dismissals: remember no-longer-Sir Fred Goodwin and his pink wafer biscuit apoplexy? Jobs, by all accounts, couldn’t get in a lift without firing someone, and used to lob prototype iPods into his fish tank to show his cowering engineers they could be made still smaller (bubbles = space = room for improvement).

The very worst chief executives remind me of Roman politicians, who squirmed their way up the greasy pole of provincial administration until they reached the top and could squeeze whole countries for all they were worth. Here’s Jimmy Cayne, who worked his way up from traveling salesman to chief executive of giant investment bank Bear Stearns, and who was playing bridge in another state when his bank went under. There’s Verres, a corrupt governor so uninterested in the world outside his own pleasure palace that he knew it was spring only when the first bouquets of flowers arrived. Whether reported by the Wall Street Journal or Cicero, there’s not much difference.

But here’s the rub. We hold our national leaders to account on the very terms we should level at chief executives. While chief executives stuff themselves with gold until they burst, we harangue would be prime-ministers about balancing the books, or what they can offer GB plc. As the sociologist William Davies has pointed out, we have achieved an ‘ontological parity’ between chief executive and PM, puffing up business leaders as charismatic visionaries, and grinding down politicians through relentless business-style audit.

Pity Natalie Bennett, not knowing how she would fund the building of her half million starter homes. Who cares, she should have said. When the banks were in trouble, the Chancellor found a trillion pounds down the back of the sofa – I’m sure a few little houses won’t even be noticed. Doesn’t the fact that five hundred thousand families suddenly have somewhere to live, that they are no longer socially and economically excluded, seem in anyway important to you, Mr Ferrari?

Chief executives, ever ready to weigh into political debate, might be loath to admit it, but states and corporations are not the same thing. Corporations, in the end, exist to make and sell us things: lawnmowers, burgers, mobile phones and face cream. They pay taxes in Luxemburg or the Bahamas and hire the cheapest labour they can find on the worst possible contracts. And, as Lehman Brothers showed us, their capacity for inflicting misery is immense.

Nations, on the other hand, should serve and support their people. Their job is to guarantee law, arbitrate fairness, and permit free and flourishing lives for their citizens. Their leaders needn’t be charismatic, but should be decent, upstanding, and empathetic. A bit of humanity, vulnerability – even the occasional trip – goes a long way in showing they have the capacity to know what matters. Sure, Miliband isn’t CEO material. That suits me just fine.

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St Andrews’ graduation, 1 December 2014

On 1 December 2014, I was privileged to give the graduation address for our departing students – Master’s graduates and several PhDs. The ceremony took place in the Younger Hall of the University of St Andrews and was streamed live to to watching parents, families, and friends all over the world.

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Here’s the text of my address, which, I’m glad to say, was very well received:

‘Chancellor, ladies and gentlemen, and most of all new graduates.

It is a universal human failing to want to have the last word, and I am as culpable as anyone. So what a pleasure and a privilege it is to stand at this lectern and offer you the last words you will hear in your university career, or at least, in this part of it.

And as with so much that you will have heard over the last year, or years, I imagine that you are only half listening; the chairs are becoming uncomfortable, the hall stuffy, and your robes hot. You are looking forward to stepping into the December cold, to processing down North Street and into the Quad, to this final rite of passage and of parting.

Many of you, parents and students alike, have travelled from all over the globe to attend this ceremony. Parents and families, I thank you. Thank you for travelling here today to see your children, siblings and friends graduate. I hope that you have a splendid, happy day and that you are not disappointed by the gaudy, mediaeval spectacle of graduation at this historic university.

More than that, I thank you for the support and encouragement that you have given to those who are graduating today. I’m sure that much of what is being celebrated here could not have been achieved without you.

New graduates, you too have travelled a long way to be here. But it cannot have escaped your notice that you have been on a much more important journey, one of growing, learning, and developing. You are no longer those nervous souls who arrived in St Andrews not so long ago. You have learned so much, and not just from books and lectures.

You now know, for example, how it feels to charge into the North Sea at dawn on May Day – a sensation of which I, and I suspect many others on the stage behind me, remain blissfully ignorant. You have come to know the ancient stones of this unique city, famous for having not one, not two, but three streets. And you understand the quiet satisfaction of living in a town where the last exciting thing to happen was the castle siege in 1546.

You have made friends, building relationships with others that will sustain you through your adult lives. Some of you will have met partners who will keep you company for the rest of your days. These are not the fragile friendships of casual acquaintance, but deep bonds of reciprocity, strong enough to ride out whatever bumps life may throw at you, generous enough to celebrate successes and triumphs joyfully and without envy. Today might be the last time you see a friend for many years, but you can be sure that the friendships you have formed here will transcend time and place.

Metaphors of journey come naturally to graduation and to St Andrews. According to legends of the town’s founding, St Rule was instructed to carry the bones of St Andrew to the end of the earth. I like to imagine the saint arriving, one cold, foggy night, staking his claim and giving thanks that he had finished his wearisome travels. History does not record what he said when the sun rose over Dundee the following morning.

As St Rule would have been painfully aware, journeys are hard work. Travel is much more fun after the fact. Beneath your still-fresh recollections of bonfires on the beach and endless blue summer evenings there are shadows of December exams and nine o’clock lectures in February. A collective shudder runs round the hall as you remember those teachers who challenged your intellects, discomfited your comforts, and unsettled your assumptions. It wasn’t always easy, but you coped, grew, progressed, and now you are passing on, setting out into the next stage of life.

Do not forget what you have learned here. We have taught you to think critically and responsibly. Reflect for a moment, and recognise that you have been blessed with talent, opportunity, and education; gifts of nature, of chance, and indeed, of the generosity of those who have helped you along the way, many of whom have come to see you graduate. It’s good to be fortunate, and today you celebrate just that.

I ask one only thing: that you, who have so much opportunity and possibility ahead, make the best of what you have been given. Do not forget those who are less fortunate. You have studied Management and International Relations. I ask that you, when the time comes, manage thoughtfully and with empathy, organise for flourishing and fulfilment, and work to build a polity worthy of future generations.

Students have been graduating in this University for six centuries. Such history bestows great responsibilities, and you cannot wear it lightly. I’m sure you are up to the task.

But enough talk! The future can wait until tomorrow. Today is your day. Enjoy it to the full, and beyond. My very last word is this: Congratulations!’

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