Monday, September 27, 2010

Dusk of the Dead

I caught the final performance of The Plough and The Stars at the Abbey on Saturday. It was a powerful reminder of the economic poverty and political abandonment that Dublin's working class have endured for so long. As we headed out to O'Connell Street after the performance I was reminded how little has changed...

Inner city Dublin, especially around the northside quays, Abbey Street and O'Connell Street is a very disturbing place these days. It may have been a matter of timing, but there was an extraordinary number of drug addicts roaming the streets, some in groups of 10-12, and many completely out of their head. I witnessed some Italian tourists running in front of traffic to get away from a group of addicts occupying a traffic island at one point. To say it felt like walking into a remake of Dawn of the Dead would be only a slight exaggeration. Dublin these days is definitely more George Romero than Sean O'Casey.

What is to be done? The Sunday Independent yesterday pointed out the spectacular failure of various policies and plans to make any difference:
There are 15 heroin treatment centres within a small area north of the Liffey and three more in the area immediately to the south of the river in central Dublin, attracting thousands of addicts into the city centre each day.

One centre alone, the Drug Treatment Centre in Pearse Street, Dublin 2, is doling out methadone to 1,200 addicts daily, it reported last year. There are no available statistics for how many people are being given methadone -- a synthetic form of heroin -- in the other 17 "treatment" centres in Dublin city centre.

The last figures available from the Health Service Executive (HSE) suggest that it also gave out almost 50,000 needles to addicts in 2007, the vast majority in Dublin city centre.
Part of the problem is the continuing treatment of our drug crisis as a crime problem rather than a health problem. Which is why I feel controlled legalisation is better than uncontrolled criminalisation. Not a solution, I might add, just a policy direction less likely to fail addicts, their families and their communities than the current direction we're heading in.

These days Fluther Good is too out of his head to be of any use to Bessie Burgess. Inner-city Dublin's long suffering working class deserves better.

Sunday, September 26, 2010


Everybody is entitled to their own opinions,
but not to their own facts.
Patrick Moynihan
There has been a bit of a kerfuffle over a recent UK study on sexual identity in the UK. Apparently Northern Ireland has the lowest percentage of homosexuals in the UK (gay, lesbian or bisexual), at just 0.9% of the population aged 16 and over. The UK average is 1.5% according to Measuring sexual identity: an evaluation report from the UK government's statistical division (ONS). It is obvious from the report that the statisticians behind it went to great lengths not to 'bias' the answers to their survey, even running it twice using different methodologies (telephone and face-to-face).

And yet the findings have provoked criticism from gay activists claiming the findings are false, as recently reported in the Irish Times. Why? One obvious implication of the findings is that adults in the UK are overwhelmingly heterosexual (94.8% to be precise, excluding the 3.3% who refused to answer). This isn't exactly a huge surprise, and indeed I've noted that precisely the same situation applies to Ireland.

What's interesting therefore is why such a backlash from gay lobbyists? I guess part of the answer is the standard motivation of self-interest. After all, if you are in receipt of enormous amounts of funding from the state and other funding institutions - because of the prevalence of the issues that you champion - then it's kind of awkward if the figures show that your organisation exists solely for the purpose of championing the needs of just 1% of the population.

But I suspect there's more to it than that. It's the logical consequence of the 'equality absolutism' that now applies to all gender issues nowadays (and a few other issues come to think of it). Equality absolutism states that one gender orientation is as valid as another, and in fact every gender orientation must be treated with the same equality of status and esteem as all others. But the fact that 97-99% of the adult population in Ireland and the UK are heterosexual - and it is a fact - sits rather awkwardly with the abolutist equality agenda.

However when the facts get in the way of ideology, the reaction is not to accept the facts but to indulge in a bout of 'heterophobia' (straights are 'breeders' after all). Odd that - and I thought the idea was to be tolerant. I'm all for tolerance myself, but it only works in the long run if everyone abides by the same rules. A bit like facts, for that matter.

Friday, September 24, 2010

Ulster's New Covenant

My work has taken me to Belfast recently, and it's always interesting to see the different perspectives on things 'up North'. I was especially struck by their sense of dread about impending public spending cuts because of the UK government's plan to balance their budget by 2015-16. This could mean cuts in the North of up to £2 billion a year. Northern Ireland is about to be mugged by economic reality - and it won't be pretty.

The North's politicians are doing what they do best - blaming others for the province's problems - without advancing any viable solutions of their own. The CBI has weighed in with proposals for a renewed focus on public sector efficiency, on the spending side as well as on the taxation side (ht Ultonia). Down South we called it the 'Croke Park Agreement' - I'll believe it when I see it.

But I think there's an opportunity to go further. As Eamonn Butler has noted:
In the rent-seeking economy of Northern Ireland, it is deemed politic to blame others for the withdrawal of funding across the economy. It is also an indictment of both the poverty of aspiration and lack of imagination among the political class.

... More importantly, as the political class seems increasing remote for the electorate, perhaps it is time to think how government could be devolved back to the individual. Northern Ireland government requires a total rethink.

For too long, Northern Ireland has been North Korea with grants. The cold winds of economic reality will not be welcomed by the North's tax-addicted politicians (that's taxes on English taxpayers, of course). However the North's struggling, yet highly capable private sector will be glad to have access to the talent and resources too often gobbled-up by the North's bloated public sector. The next five years will provide a fascinating opportunity for free markets to tackle Northern Ireland's chronic economic and social problems. And given the innate entrepreneurial talents on both sides of the political divide there, I have no doubt the North will be a much better place by 2016.

A new Ulster Covenant is being forged, one that gives pride of place to the talent and ambitions of individuals and their communities. I think we'll learn a lot down South from what happens up North in the years ahead.

Wednesday, September 22, 2010

Married to Welfare

Imagine there was just one lifestyle change, a single, simple social practice that could eradicate child poverty almost completely. And it wouldn't cost the taxpayer a cent. I would imagine that any organisation concerned with social justice and the eradication of poverty would champion such a practice from the rooftops. Especially an organisation founded, operated and funded by Christian organisations. Yet I would be wrong.

For we have such an organisation - Social Justice Ireland (née CORI) - run by a priest and a nun, and yet they have no interest in the social practice I am talking about, namely: marriage. Their latest report - More Taxes, More Government Please (sorry, that should read: The Future of the Welfare State) mentions marriage twice. Once as a footnote, and the second time as part of the phrase 'gay marriage'. And that's it. God barely gets mentioned either, but that's their issue, not mine.

But what is my issue - and yours if you pay tax - is that the authors of the report are wilfully blind to the potential for marriage to reduce poverty. Take the recent ESRI report on poverty trends in Ireland. The single biggest factor influencing the incidence of poverty is the presence or otherwise of both parents. The report finds that:
Household composition is also a strong predictor of consistent poverty. Risks of consistent poverty among children in lone parent families are even more pronounced than those in the income poverty models. These children are 15 times more likely to be in consistent poverty than children living in two adults plus one or two children households.

Despite the reduction in both measures, children in lone parent families in particular still had a very high likelihood of being in poor households compared to other children. Moreover, demographic trends mean that the number of lone parent families increased over the period, as did the concentration of child poverty among lone parent families. By 2007, children in lone parent families accounted for 65 per cent of children in consistent poverty. These results suggest that reducing the disadvantages experienced by lone parent families will be crucial for tackling child poverty.
Now the SJI solution to 'reducing the disadvantages' is to take more money from taxpayers in order to provide a Basic Income that will lift everyone out of poverty. A rising tide raising all boats, if you will. Strangely, for an organisation that waxes eloquently about the numerous failings of money-obsessed, free market capitalism, they do seem to have a singularly strong attachment to the old paper-and-coin stuff themselves when it comes to solving all the problems that they see.

Bizarrely, despite mounting evidence in Ireland and abroad that marriage is one of the most powerful anti-poverty practices in the world, SJI would prefer to completely ignore the matter. Better to tax affluent and not-so-affluent workers it seems (and their capitalist employers, of course) than actually advocate that would-be parents make a wiser choice about their future family status instead.

The SJI report suffers from many (many) other inadequacies - their ideological bias can best be thought of as a form of 'socialism with group hugs' - but that can be forgiven to the extent that they wear their ideology on their sleeves. Less forgiveable is a deliberate, PC-driven blindness to the role of marriage simply because it would demand judging some lifestyle choices better than others. Or treating grown ups as independent adults rather than welfare supplicants, if you will.

And sadly, they'll probably prevail with their doomed-to-fail policy ambitions. Get your chequebooks out...

Tuesday, September 21, 2010

Losing Our Freedom

Whilst folk fret about the bond markets a more serious problem is unfolding: we are losing our freedom. The latest Economic Freedom of the World Report 2010 shows Ireland slipping from number 4 (in 2005) in the world in terms of economic freedom to number 11 in 2008. I suspect things have deteriorated considerably since.

There are many factors implicated in the decline, but by far the largest is the growth of the government's share of economic activity. Some of this is cyclical (increases in social welfare payments due to unemployment) and will recede as recovery gathers pace. But in Ireland's case we must beware structural forces driving government's influence in the economy. The EFW report highlights one such force in particular, namely crony capitalism:
As this debate unfolds, it is important to distinguish between market entrepreneurs and crony capitalists. Market entrepreneurs succeed by providing customers with better products, more reliable service, and lower prices than are available elsewhere. They succeed by creating wealth: by producing goods and services that are worth more than the value of the resources required for their production. Crony capitalists are different: they get ahead through subsidies, special tax breaks, regulatory favors, and other forms of political favoritism. Rather than providing consumers with better products at attractive prices, crony capitalists form an alliance with politicians. The crony capitalists provide the politicians with contributions, other political resources, and, in some cases, bribes in exchange for subsidies and regulations that give them an advantage relative to other firms. Rather than create wealth, crony capitalists form a coalition with political officials to plunder wealth from taxpayers and other citizens.
Sounds familiar? To paraphrase Lenin, the crony capitalists will sell the rope that the statists will use to hang the market entrepreneurs. And it's only going to get worse: pretty soon we'll all be paid by the state...

Monday, September 20, 2010

Let's Get Econophysical

Sorry Olivia, I couldn't resist the pun. I've been reading Paul Ormerod's presentations on econophysics lately: it's a fascinating subject and one with real potential - just like behavioural economics - to fundamentally change our understanding of microeconomics in particular. Paul takes his cue from Hayek:
An economist who is only an economist cannot be a good economist. Hayek, 1974
More and more economists are taking this to heart: hence the new fusions of behavioural psychology, neuroscience and even - gulp! - sociology that push the boundaries of the discipline. The RSA have just published an essay by Paul - N Squared: Public Policy and the Power of Networks - that links the world of behavioural economics - or Nudge - to that of econophysics: specifically the modelling of network effects. Paul is sceptical about the power of behavioural economics-based policies alone to be effective. As he explains it:
A final, and crucial, point to stress about nudging is that the aim of behavioural economics is to try to provide better descriptions of how people really do behave as individuals. The assumption behind mainstream economics is that agents act autonomously and do not take directly into account the behaviour of other agents. Networks, in contrast, do. And their implications can be dramatic.

...Many of the decisions we make are based not so much on the independent, rational calculation of the costs and benefits of different actions – the mode of behaviour posited in economic theory – but on observing and copying others.
These network effects - observing and copying others - are what intrigue Paul and others in the econophysics space. The RSA essay contains scores of fascinating commercial, political and historical examples of how network effects - whether 'random', 'scale-free', or 'small-world' - can flip seemingly modest policy interventions into runaway successes - or spectacular failures:
In Sardinia during the 1990 World Cup, the English supporters were feared for their violent reputation. One evening in Cagliari, a large number gathered in the streets. Facing them were the police. Various individuals made attempts to stir the fans into collective action without success; the ‘cascade’ that was intended by these people did not take place. But in response to the actions of one particular youth, a police captain fired his pistol into the air. The English supporters immediately began to destroy property and attack the police. The action intended to nudge them into quiescence, provoked exactly the opposite reaction across the network of fans.
These network effects can help explain many 'suddenly-increasing' phenomena - from obesity, to binge drinking to single parenthood - that have frustrated policy makers everywhere as they deal with the consequences, and try various behaviour-changing policies (including plain old fashioned price increases/welfare restrictions) to no avail. But policies that combine 'nudge' with 'networks' (the N Squared in the title) are more likely to succeed.

I also think the impact of network effects on business and consumer confidence is also hugely important. Take this example from the essay:
A relevant practical example is sentiment about the future; the degree of optimism or pessimism which firms feel at any point in time – Keynes’ ‘animal spirits’ – is an important determinant of the boom and bust of the business cycle. We can think of a firm in state A as being optimistic. The economy receives a small shock, a bit of bad news, and a few firms switch to state B, pessimistic. How many others will abandon their optimism? If enough do so the economy will move from boom to bust. The economy in this case has only received a small adverse shock. Can this really be sufficient to precipitate a full-blown recession?

The answer is both yes and no! The same small initial disturbance can have dramatically different outcomes. Most of the time, the initial switch by a small number of agents from A to B, does not spread very far. But occasionally, there will be a cascade across the system and most agents will end up with B. This is critical for policymakers who are generally schooled in trying to design interventions that will make relatively small predictable changes, with minimal risk.
The good news is that it can work the same way from widespread pessimism to widespread optimism. Which is why I'm more confident about the prospects for economic recovery here in Ireland than many: even if our policy makers seem to be doing their best to prevent it happening. The sooner we all get econophysical the better.

Sunday, September 19, 2010

Privatising the Future

Don't worry, I'm not talking about our state-owned treasures (I mean, would you buy a used car from that lot currently in power?) I'm talking specifically about maintaining a space for privacy in the future. Or rather, Sherry Turkle is in her contribution to a new series of essays in Discover magazine on scientific prospects for the next thirty years. She thinks it is important that we leave room for dissent:

But sometimes a citizenry should not be good. You have to leave room for this—space for dissent, real dissent. You need to leave technical space (a sacrosanct mailbox) and mental space. The two are intertwined. We make our technologies, and they, in turn, make and shape us...

In a democracy, perhaps we all need to begin with the assumption that everyone has something to hide, a zone of private action and reflection, a zone that needs to be protected. My hope is that we rediscover our need for privacy. To me, opening up a conversation about rethinking the Net, privacy, and civil society is not backward-looking nostalgia in the least. It seems like part of a healthy process of democracy defining its sacred spaces.
I agree, in a culture that only tolerates diversity so long as it is compliant with politically-correct orthodoxy, then making room for dissent is more important than ever.

The overall tone of the different essays on the future of science are nevertheless positive. As they should be: most of us are alive today (and enjoying better lives than our forebears could even have imagined) thanks to science. But not everyone is as optimistic. James Le Fanu fears science is at a dead end:
So the best of times—but also the worst. Pose the question, What does it all add up to? and the answer, on reflection, seems surprisingly little—certainly compared to a century ago, when funding was an infinitesimal fraction of what it has become. In the first decade of the 20th century, Max Planck’s quantum and Einstein’s special theory of relativity would together rewrite the laws of physics; Ernest Rutherford described the structure of the atom and discovered gamma radiation; William Bateson rediscovered Mendel’s laws of genetic inheritance; and neurophysiologist Charles Sherrington described the “integrative action” of the brain and nervous system. The revolutionary significance of these and other discoveries were recognised at the time, but they also opened the door to many scientific advances over succeeding decades.

By contrast, the comparable landmarks of the recent past have been rather disappointing. The cloning of a sheep generated much excitement but Dolly is now a stuffed exhibit in a Scottish museum and we are none the wiser for the subsequent cloning of dogs, cats and cows. It will no doubt be a similar story with Craig Venter’s recent creation of “artificial life.” Fabricating a basic toolkit of genes and inserting them into a bacterium—at a cost of $40m and ten years’ work—was technologically ingenious, but the result does less than what the simplest forms of life have been doing for free and in a matter of seconds for the past three billion years.

Diminishing marginal returns are setting in, it seems. But I think Le Fanu misses the obvious: it is the application of science, not just the process of discovery itself, that contributes to the human condition. The people with the greatest incentive to discover and apply are those on the margins: those who want to change things. Robin Hanson makes a similar point, citing the work of Thorstein Veblen which found that 'diversity induces far view talk, which finds creative answers'.

It is the outsiders who dissent and who therefore discover. They're more often business people than scientists. To the extent that our smart economy strategy is simply channelling money to the scientifically orthodox, then the lower the chances that it will succeed. Which is why we need to make room for dissent.

Failing that we can always sell our state-owned treasures...

Saturday, September 18, 2010

History Doesn't Rhyme, It's Arrhythmic

Niall Ferguson doesn't think there are cycles in history. In a lecture which takes its cue from Thomas Cole's famous five-part portrayal of The Course of Empire, he suggests that history is arrhythmic, prone to sudden transitions from seeming calm to unforeseen chaos. But as an historian he does divine some clues as to when the transition might occur (from about 27 minutes into his lecture):

Imperial falls - forget declines, there isn’t a decline, just a fall: bang, off a cliff - are nearly always associated with fiscal crises. With dramatic imbalances between revenues and expenditures. And above all - here’s the key idea - these crises, these dramatic falls, are associated with a mounting cost of servicing a huge public debt. ... When all of your ordinary tax revenues are going on interest payments it is, ladies and gentlemen, game over.
Of course, Ireland doesn't have an empire so we can relax, right? A recent Davy report argues that our debt problems are greatly exaggerated as our debt service costs - though a growing share of taxes (20% of all taxes and rising) - are a long way away from Ferguson's trigger point:

Perhaps. Time will tell, indeed. But Ferguson's arrhythmic view of history warns us not take anything - especially extrapolations - for granted. Whether you're a small country or an empire. It's worth watching the whole thing: sure it's an hour long, but we'll all be living for the rest of our lives with the consequences Ferguson anticipates from the 'history' now being made. Turbulence ahead indeed...

Friday, September 17, 2010

Illiberal Democracy

This week's Spiked! is a corker. Frank Ferudi observes about the vitriolic reaction by many to the Pope's visit to the UK that:
Indeed, anti-Catholic prejudice is one of the main themes of today’s increasingly conformist imagination. It has reached a level where anyone who doesn’t possess a strong feeling of animosity towards the pope and his visit is viewed as a hopeless apologist for the abusive authority of theocratic despots.

We've reached a curious point where the measure of one's liberal tolerance is the strength of one's intolerance. Liberal democracy is becoming increasingly illiberal it seems. Secular sectarianism is still sectarian, and just as ugly as the religious variety. As David Quinn points out in today's Independent, the new atheists are now on the same side as Ian Paisley! Must-be-some-mistake-surely?

Every belief system has its shadow-side. The shadow side of liberal humanism and the good things associated with the Enlightenment is its propensity to turn universalist values into uniform values. Kenneth Minogue observes it clearly (ht Let A Thousand Nations Bloom):
My concern with democracy is highly specific. It begins in observing the remarkable fact that, while democracy means a government accountable to the electorate, our rulers now make us accountable to them. Most Western governments hate me smoking, or eating the wrong kind of food, or hunting foxes, or drinking too much, and these are merely the surface disapprovals, the ones that provoke legislation or public campaigns. We also borrow too much money for our personal pleasures, and many of us are very bad parents. Ministers of state have been known to instruct us in elementary matters, such as the importance of reading stories to our children. Again, many of us have unsound views about people of other races, cultures, or religions, and the distribution of our friends does not always correspond, as governments think that it ought, to the cultural diversity of our society. We must face up to the grim fact that the rulers we elect are losing patience with us...

Some may forgive these intrusions because they are so well intentioned. Who would defend prejudice, debt, or excessive drinking? The point, however, is that our rulers have no business telling us how to live. They are tiresome enough in their exercise of authority—they are intolerable when they mount the pulpit. Nor should we be in any doubt that nationalizing the moral life is the first step towards totalitarianism.
The increasing illiberalism of modern societies, including Ireland (Stage 2 of the plan to deny us access to incandescent light bulbs kicked in this month), will exact a high price in the future. Universal uniformity didn't work especially well when Popes ruled Europe, and it won't work any better when the secular sectarians get their way.

Wednesday, September 15, 2010

The Mercantilist Century

Whilst we're still figuring out who to blame here on Depression Island, the rest of the world seems to be getting on with business. But it isn't business as usual. If anything the global economic crisis has accelerated a profound shift in the relative weight and roles of the major economic blocs around the world. The shift has been in favour of the BRIC economies, especially China. But with the shift has come a very different type of global economy - one characterised less by 'free markets' (to the extent they were really free), and more by a new mercantilism in which economic activities are directed by states in pursuit of nationalist goals.

I listened recently to Ian Bremmer's talk at the RSA (a series you should definitely add to your podcast feed). Ian's take - wearing his Eurasia Group hat - is that the future of the global economy will increasingly be dominated by the mercantilism of countries like China, Saudi Arabia and even Brazil. Especially by state owned companies intent on maximising exports in order to generate the flow of funds their governments need in order to meet their various objectives (political and military). He doesn't think this is necessarily a 'good thing' (as he explains it, mercantilism is even more dependent on continuing economic growth than the 'free market' variety), but he does think it's the new reality and that all Western businesses will have to get used to.

One remarkable consequence of the new mercantilism is the surge in demand for land around the world. What Ambrose Evans-Pritchard calls the global landgrab. Which is another reason why I think land (of the farming variety) is the best long term investment opportunity for those who weren't wiped out by the land-for-building bubble. But beyond land, the new mercantilism is already making itself felt in a host of markets and sectors. The challenge for Ireland will be how best to align our internationally-traded sector with these new realities, whilst also insuring ourselves against the inevitable fall out (trade wars etc) from mercantilism's failure. Because one things for sure, the new variety will fail just like the old variety, though perhaps more spectacularly.


For those interested in the world beyond early morning radio interviews on RTE, I highly recommend subscribing to the Eurasia Group blog and twitter feeds as well as those for the equally excellent Stratfor (their unfolding analysis of American involvement in Iraq/Iran/Afghanistan is second-to-none).

Tuesday, September 14, 2010

Circling Over Shannon

Was this morning Brian Cowen's Yeltsin Moment? For our younger readers, Boris Yeltsin was famous for a press conference he gave in Shannon airport in 1994 when he was the Russian President, or rather, that he didn't give.

Personally I don't have a problem with Brian Cowen letting his hair down and enjoying a few drinks with his friends. We all do it from time-to-time after a busy day. I just have a problem with him being Taoiseach. Boris wasn't too popular either at the end, come to think of it - his approval rate upon leaving office a few years after the Shannon incident was just 2%.

Though in fairness, the Taoiseach's approval rate stands at a far higher 5%. Maybe he better keep circling over Shannon.

Sunday, September 12, 2010

Creating the Future

Maybe it's the tyranny of round numbers or something, but here's yet another look ahead to 2020, this time from Forbes. It's not bad actually - John Maeda's essay on Your Life in 2020 is close to my own heart with his emphasis on the explosive potential for a new renaissance of creativity and art in the years ahead:
We'll witness a return to the integrity of craft, the humanity of authorship, and the rebalancing of our virtual and physical spaces. We'll see a 21st-century renaissance in arts- and design-centered approaches to making things, where you--the individual--will take center stage in culture and commerce.
He's channelling Frederick Turner and even John Maynard Keynes:
I see us free, therefore, to return to some of the most sure and certain principles of religion and traditional virtue‑that avarice is a vice, that the exaction of usury is a misdemeanour, and the love of money is detestable, that those walk most truly in the paths of virtue and sane wisdom who take least thought for the morrow. We shall once more value ends above means and prefer the good to the useful. We shall honour those who can teach us how to pluck the hour and the day virtuously and well, the delightful people who are capable of taking direct enjoyment in things, the lilies of the field who toil not, neither do they spin.
There are a couple of other interesting essays and views in the Forbes 2020 feature (including some interesting visual treatments of the topic, and a 'vote for the future' feature). Lisa Gansky things consumers will get used to sharing in the future rather than owning them thanks to the emergence of what she calls 'Mesh Businesses'. It has already started.

Apart from the tyranny of round numbers, I suspect part of the motivation for these type of prospective rather than retrospective pieces is to do with the seemingly insoluble nature of our present day problems. A feeling not just confined to Ireland obviously. Sure it's a form of escapism, but it serves a more noble purpose. It reminds us that we are not victims of circumstances beyond our control: we are masters of our own destiny to the extent that the future we get will be the one we 'deserve', either through what we do in the present, or what we fail to do.

Therefore thinking about the future we want and acting accordingly is the most responsible thing we can do right now. And also the most creative.

Saturday, September 11, 2010

The Business of Books

Kevin Kelly has a new book out. His thoughts on the experience are amusing:
You too can own one of these remarkable reading gizmos. No batteries, ambient light screen, random access, containing the full text of my 120,000 word manifesto...

Another reason to order this fine physical specimen: I suspect this will be the last paper-native book that I do. The amount of work required to process atoms into a sheaf of fibers and ink and then ship it to your house or the local bookstore is more than most of us are willing to pay any more. And of course the extra time needed upfront to print and transport it is shocking. This book was finished, designed, proofed, and ready to be read four months ago. But atoms take time, while bits are instant.
I've been thinking some of the same things now that my own book has been published by Mercier Press. It is delightful to hold in your hand a physical artefact that you have 'created' yourself (okay, with a little help from a lumber company, a paper manufacturer, a printer, a savvy editor and a great book publisher!)

But a little like KK, I find myself wondering about the future of the publishing business model (as, no doubt, do most publishers). Compared to the 'instantaneous' nature of blogging, writing a book is a remarkably slow process. It has to be, of course, for reasons such as proofing, editing and pre-selling the book to possible stockists. Parts of the process can be speeded up (you can order my book online at Amazon, for example, rather than go to a bookshop), but as Kevin says, atoms take time, while bits are instant. My book will eventually be available for the iPad and Kindle, so I suppose I will have bridged the atom/bit divide by that point. And I've set up a web site - The 2016 Proclamation - to provide the kind of reader feedback and a forum for discussion that only the world of bits makes economically possible.

The question for the book publishing industry, of course, is what business model will allow them to straddle the atom/bit divide - profitably. About half of all Irish adults say they will eventually read books on digital media such as the iPad. But then again, half of them say they won't. And it isn't just the readers. As a writer - already used to seeing my words expressed in 'bits' - it's still thrilling to see them expressed in atoms.

So I'll probably buy the atoms version of Kevin's book on Amazon, though I realise I may have to buy his future books in the bits version only. And of course, if you feel like getting your hands on the atoms version of my own book then it's only a click away :)

Friday, September 10, 2010

Dreaming of Determinism

Jeff Randall quotes J K Galbraith today:
We have two classes of forecasters: those who don't know—and those who don't know they don't know.
Jeff proposes a third class: those who thought they knew, but now know they didn't in light of continuing economic uncertainty. In a delightful essay - On Prediction - Robert Tietelman steps back from day-to-day economics and shares a more philosophical take on the forecasting challenges we face:

We live in a prediction society.

That's another way of saying we live for the future, our minds restlessly casting forward to some concatenation of forces, energies and tendencies that will produce a certain effect at a specific time: a sunny day, high of 87, meteor shower at midnight or, better yet, Dow 36,000. Homo sapiens has undoubtedly always needed to peer ahead through the banana leaves to an uncertain future, if only to get that next meal. But our fixation on the future, our deep, often subconscious belief in progress, is an aspect of modernity, fueled by the acceleration of technological change, and the rise of growth-oriented economies driven by free markets. In a performance culture, the future always beckons.
Our fixation drives us to frenetic efforts at forecasting:
We look back only to peer forward; the past has become a warehouse of shrouded furniture awaiting new digs. We drill into historical prices in hopes of establishing a discernible pattern into the future. We poll the masses, or accumulate Internet data, to extract some sense of how they'll react in the future. We ponder charts. We strain to master mechanisms -- economic, market, governance, sentiment -- in the belief that a known set of causes will create a known set of effects. We live for prediction because we need to believe in an orderly world where a known past shapes a predictable future. We're free agents dreaming of determinism.
I love that last line: we are free agents dreaming of determinism. I suspect a lot of commentators on Ireland's continuing economic misfortunes are such dreamers. They imagine that if only the 'right decisions' are taken on Anglo Irish Bank, on NAMA, on taxes, and on public spending then - and only then - will things start to get better and the true path to future recovery will beckon. But the world isn't determinist. To re-quote Paul Ormerod:
To repeat a key phrase which needs to be hard-wired into the brain of every decision-maker, whether in the public or private sector, intent is not the same as outcome. Humans, whether acting as individuals or in a collective fashion in a firm or government, face massive inherent uncertainty about the effect of their actions.
Which is why I find myself in Jeff Randall's third class: less certain in the face of growing uncertainty. Ireland today faces greater uncertainty about it's future than at any stage since the formation of the Irish Free State and Northern Ireland in 1922. Today's uncertainties are clearly different and less violent than those in 1922. Mainly because our economy is now more integrated into the global economy and therefore more exposed to developments elsewhere beyond our control.

However, uncertainty goes both ways: the future could be worse... or it could be better. The latter outcome - admittedly the less 'likely' one according to most prediction makers - could come about if....... Oops, I nearly fell into the determinist trap there. The thing is, I don't know what precise combination of decisions, measures and actions will 'solve' our problems. No one does. I do know there are things that should not be done, e.g.: making it more expensive to hire workers or less worthwhile to hold on to them. And I know that there are things that should be done, e.g.: stop propping up a bank that isn't lending to businesses so other banks can start to access the capital they need in order to lend to businesses.

I also know that it will the cumulative effects of the individual actions of employers, employees, savers, consumers, investors, fund managers, bank managers, civil servants, TDs, government ministers, newspaper editors and a host of others that will shape our nation's response to the uncertainties that we face. Nobody can forecast each of those individual actions, nor their cumulative effects. And I find that profoundly encouraging: our future is not completely in the hands of any one government or bond market or bank.

We should stop dreaming of determinism and determine to dream of a better future for our country, one shaped by the actions of every single one of us. With uncertainty comes probability and with probability comes chance. And chance - or fortune - favours the brave. Fear the forecasts and do it anyway.

Tuesday, September 7, 2010

The New Protestants

Chris Horn links early 20th century Irish history, on both sides of the border, to the 21st century task of growing Ireland's economy. And it doesn't involve the M1:

It is interesting to reflect on the economic and social concerns of the founders of our State in the early 1920s. At the time, Great Britain was arguably the world’s superpower, and despite the destitution of the first world war, it still led the world in political and military might. Belfast and Northern Ireland were amongst the bedrock of the British economy, with Harland and Wolff, other heavy engineering companies and the linen industry. Northern Ireland was largely Protestant, an ethos which in turn places an emphasis on the independence of the individual, including a direct relationship with God. Entrepreneurship and individual hard work are understood by its devotees as a duty to society and as necessary to build one’s life and social status.

In founding Ireland in the 1920s, I suspect that there may have been a certain reaction against the capitalist ethos of much of Northern Ireland at that time. Most believed that workers were being exploited, that many were marginalised, and that the standards of living were poor whilst all the time entrepreneurs continued to accumulate wealth. The Roman Catholic Church was no doubt very influential on the themes for the new Irish State: cherish all citizens, high ethical standards, and a socially oriented state, rather than rampantly capitalistic. Whilst Protestantism places an emphasis on the individual, Catholicism expects the Church and its leaders to make decisions on behalf of the people. The people in turn arguably expect the Church to deliver their salvation, rather than each individual by himself or herself. Individual initiative, including wealth creation, may have been seen by some as challenging the role of authority and what was best for society as a whole.

Unfortunately the dire realities of our new found (relative) poverty require us to be a lot more 'Protestant' in the South:

I believe that Ireland is at a cross roads. We have created an economy which is open to international trade, but which is now internationally viewed as having an uncertain future. We have created an expectation of the State paternally providing for its citizens, and in particular for employment and for welfare, but which is now threatened by unsustainable national debt. We have created a society in which personal wealth is viewed with deep suspicion about how it was accumulated, what strokes may have been involved, and to what extent tax is being evaded.

He's right, of course. We can't go back to a dysfunctional combination of 'Catholic Corporatism' coupled with an emigration safety-valve to stop our youth taking to the streets. We have to become more 'Protestant' in the Weberian sense: looking to ourselves rather than to others to build businesses, create jobs and accumulate wealth (of the real variety, rather than the ponzi version we got during the boom). The good news - according to a recent IDA/IMI report on innovation in Ireland - is that we not only know what it takes to be entrepreneurial and innovative, we've got what it takes.

And the other thing going for the Republic of Ireland right now is that it isn't Northern Ireland: ironically the Protestant Ethic is fading fast up North. As the Centre for Social Justice report on Breakthrough Northern Ireland makes clear, the North is now in the grip of a level of state economic dependency and societal collapse that is a far cry from the future envisaged by Edward Carson back in the 1920s when the economic future looked so much brighter North of the border.

The next ten years may well widen the economic divide on this island, even as the new M1/A1 brings us closer.

Monday, September 6, 2010

Feeling Cyclical

History is seasonal, but its outcomes are not foreordained. Much will depend on how tall we stand in the trials to come. But there is more to do than just wait for that time to come. The course of our national and personal destinies will depend in large measure on what we do now, as a society and as individuals, to prepare.
The Fourth Turning
There is something fascinating about cyclical theories of history. Apart from the obvious excitement of wondering 'where are we in the cycle now', they also help to make sense of the day-to-day confusion of news and events. Kondratieff was one of the great cyclical theorists of the twentieth century (see summary of his theory of cycles here), and then there is the Elliot Wave Principle - still used by some investors to plan their strategies.

But the other thing cyclical theories of history do is to remind you that there's nothing new under the sun - this time isn't different - and so we can learn from our predecessors and how they handled the same or even greater challenges successfully in the past. And one of the key learnings is about what we have to do as individuals - in our families, communities, workplaces and so on - to be prepared and to rise to the challenge.

I've been re-reading the work of William Strauss and Neil Howe in relation to The Fourth Turning. They posit a cyclical, generational model of change - mostly referring to the United States - which they describe as turnings:
A turning is an era with a characteristic social mood, a new twist on how people feel about themselves and their nation. It results from the aging of the generational constellation. A society enters a turning once every twenty years or so, when all living generations begin to enter their next phases of life. Like archetypes and constellations, turnings come four to a saeculum, and always in the same order:
  • The First Turning is a High. Old Prophets disappear, Nomads enter elderhood, Heroes enter midlife, Artists enter young adulthood—and a new generation of Prophets is born.
  • The Second Turning is an Awakening. Old Nomads disappear, Heroes enter elderhood, Artists enter midlife, Prophets enter young adulthood—and a new generation of child Nomads is born.
  • The Third Turning is an Unraveling. Old Heroes disappear, Artists enter elderhood, Prophets enter midlife, Nomads enter young adulthood—and a new generation of child Heroes is born.
  • The Fourth Turning is a Crisis. Old Artists disappear, Prophets enter elderhood, Nomads enter midlife, Heroes enter young adulthood—and a new generation of child Artists is born.
    Right now, they reckon the United States is well on the way to the Fourth Turning, which they describe thus:
    A Crisis arises in response to sudden threats that previously would have been ignored or deferred, but which are now perceived as dire. Great worldly perils boil off the clutter and complexity of life, leaving behind one simple imperative: The society must prevail. This requires a solid public consensus, aggressive institutions, and personal sacrifice.

    People support new efforts to wield public authority, whose perceived successes soon justify more of the same. Government governs, community obstacles are removed, and laws and customs that resisted change for decades are swiftly shunted aside. A grim preoccupation with civic peril causes spiritual curiosity to decline. A sense of public urgency contributes to a clampdown on “bad” conduct or “anti-social” lifestyles. People begin feeling shameful about what they earlier did to absolve guilt. Public order strengthens, private risk-taking abates, and crime and substance abuse decline. Families strengthen, gender distinctions widen, and child rearing reaches a smothering degree of protection and structure. The young focus their energy on worldly achievements, leaving values in the hands of the old. Wars are fought with fury and for maximum result.

    Eventually, the mood transforms into one of exhaustion, relief, and optimism. Buoyed by a newborn faith in the group and in authority, leaders plan, people hope, and a society yearns for good and simple things.
    Sure, their language is arcane (it reminds me of writings about the Enneagram), and maybe it's little more than a form of 'secular astrology' (I'm sure that's the professional historian's view of this sort of thing). And yet, and yet... It seems to me we are going through some kind of very real 'turning' here in Ireland, a real generational shift, and one that is following some of the patterns ascribed to the United States.

    It certainly feels like a crisis - and not just a run-of-the-mill recession that we'll soon bounce back from. But as the authors of the Fourth Turning point out, such turnings also present rare opportunities to bring about radical changes that would otherwise be impossible in 'easier' times - and which will also equip us to get through the crisis to the better times ahead.

    And don't forget it's cyclical. Spring always follows winter - as Kondratieff reminded us.

    Sunday, September 5, 2010

    Tony's Fallacy

    Tony Blair's training as a barrister has served him well. He is a master of linguistic jujitsu, as evidenced by his performance on the Late Late Show. But his performance is also a master class in argumentative fallacies.

    Mike Labossiere has produced a very handy guide to 42 Fallacies over at the Talking Philosophy blog. I scored Tony Blair on several of them, in particular the fallacy of an Appeal to Fear. Here's Mike's explanation:
    The Appeal to Fear is a fallacy with the following pattern:

    1) Y is presented (a claim that is intended to produce fear).
    2) Therefore claim X is true (a claim that is generally, but need not be, related to Y in some manner).

    This line of “reasoning” is fallacious because creating fear in people does not constitute evidence for a claim.
    It struck me listening to Blair's justification for the invasion of Iraq - namely that Saddam might have had weapons of mass destruction, and he might have used them on his opponents outside of Iraq, therefore we had to invade - is very much an Appeal to Fear. Some of the same now applies to Iran. We also have a similar fallacy in play over Anglo-Irish Bank with such disgraceful claims as that by Brian Cowen TD about a €70 billion price tag if we don't do what the Government says.

    If we could create a 'Fallacy Filter' and apply it to all politicians' pronouncements then the world might well be a better place. And the news less alarming. The next task for Mike perhaps?

    Saturday, September 4, 2010

    A Return to Judgement

    I've noted before that the only remaining 'sin' in a secular society is that of passing judgement. I have argued that a culture of unwillingness to judge people and their behaviour is responsible for a large number of the major social and economic problems that we face. From the deaths of teenagers in traffic accidents to rogue bankers (and civil servants) still in their jobs, we seem to live in a society in which nobody is held accountable for the consequences of their own actions. A typically right wing, reactionary lament of course.

    Which is why it is interesting to see some on the Left now also beginning to question our lack of judgement. Writing in the left-of-centre Democracy - A Journal of Ideas, Roger Berkowitz is anxious to explain Why We Must Judge. As Berkowitz explains it:
    At the root of our problem with judgment is the undeniable victory of relativism over truth. Judgment requires, above all, what Kant called disinterestedness and what Arendt called enlarged mentality, seeing the question from another’s point of view. While it is singular, judgment is not mere personal taste or preference. To judge is to speak the truth, a truth that must always appeal to a common sense beyond one’s own prejudices. At a time when tolerance trumps truth, judgment’s claim to the truth leaves it vulnerable to mockery and derision.
    We so fear judgment today that we banish it from public life. We even banish it from law. Why? Because judgment is unruly, singular, and unpredictable. It is personal instead of objective and grounded in prejudices at the expense of rationality. It asserts a truth amidst skepticism about truth. It thus rejects the liberal values of relativism, equality, and scientific objectivity that define our time. In other words, judgment accomplishes little and costs much.
    And finally:
    Instead of judging, we reckon and negotiate. Judgments like those of Athena, Orestes, and Agamemnon discriminate. They assert a truth. They address particular persons and singular events and risk saying: This person is guilty, this one is innocent. Such judgments are often unreasoned, but this makes them neither irrational nor thoughtless. They are often intolerant and unfair, but this makes them neither racist nor unjust. Amidst the unquestioned hatred of all discrimination, we have forgotten that discrimination, the art of making relevant distinctions, is actually the root of judging. In our passion for rationality and fairness, we sacrifice judgment, and with judgment, we abandon our sense of justice.
    It's a thoughtful essay - and a hopeful one too. Berkowitz recognises that judgement binds a society together through its recognition of the 'common sense' of what is right and wrong, of what is acceptable behaviour and what is unacceptable. If our society - here in Ireland and in the West in general - is to remain cohesive as well as open, we must be more explicitly moral. Morality, at its most basic, is that sense that guides our interactions with one another. A return to judgement should even fit with the traditional values of the Left (fairness, inclusion) as well as the Right (freedom, hierarchy).

    And it may even go some way towards halting those individual and group behaviours that continue to threaten our social and economic future.

    Friday, September 3, 2010

    Here's to Tomorrow

    Here's somethng you won't read in an Irish Times editorial: drinking alcohol in moderation is better for you than excessive drinking (obviously) and abstention (less obviously). Specifically:
    Controlling only for age and gender, compared to moderate drinkers, abstainers had a more than 2 times increased mortality risk, heavy drinkers had 70% increased risk, and light drinkers had 23% increased risk. A model controlling for former problem drinking status, existing health problems, and key sociodemographic and social-behavioral factors, as well as for age and gender, substantially reduced the mortality effect for abstainers compared to moderate drinkers. However, even after adjusting for all covariates, abstainers and heavy drinkers continued to show increased mortality risks of 51 and 45%, respectively, compared to moderate drinkers. (ht: Overcoming Bias)
    So there you go: eat, drink and be merry - for there's a better chance you'll see tomorrow.
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