Stumbling and Mumbling

Hillary the Nietzschean

Everyone's mocked Hillary for her "mis-speaking." Only Bryan Appleyard, however, has come close to diagnosing the underlying illness. Her narcissism, he says, has caused her to elevate the survival and propagation of her self-image above all other values, such as a respect for reality.
In this sense, Hillary is a good Nietzschean. So-called "truth", he said, is just "a mobile army of metaphors, metonyms, and anthropomorphisms -- in short, a sum of human relations, which have been enhanced, transposed, and embellished poetically and rhetorically" in the service of the pursuit of power.
To him, the founding fact about the world is not external reality but rather our own wills: 

Nothing is “given” as real other than our world of desires and passions and...we cannot access from above or below any “reality” other than the direct reality of our drives...Seen from inside, the world defined and described according to its “intelligible character” would be simply “will to power” and nothing else. (Beyond Good and Evil.)

The important thing here, though, is that Hillary is not unique. Prioritizing the will to power over the truth is a defining feature of managerialism. Managers presume that the world can be bent according to their will. And, time being a tricky thing, it's a small step from thinking the future is wholly malleable to thinking the past and present are as well - as Stalin knew in his notorious doctoring of Russian history. Hillary's "mis-speaking" is in the same category as New Labour's smearing of David Kelly and bosses' presentation of company accounts not as objective measures of corporate performance but as vindications of their own success. All subordinate "truth" to ego.
Now, I'm not suggesting Hillary, or bosses generally, do this consciously. I suspect instead that Hillary has lived so long within the purely imaginary world of the decision-maker that she has long forgotten the distinction between her own will and reality.
But the distinction does exist, if only because "reality" is the product of others' wills as well as her own. So perhaps Hillary's tragedy is not merely her Nietzschean narcissism, but also her solipsism.

Credibility and public borrowing

I had hoped to avoid the Budget, being unable to improve upon the mighty Mash's coverage. But I had the misfortune to hear Darling on the Today programme, which reminded me of why I so loathe the whole pantomime. It's a perversion of economics.
Darling was repeatedly asked: why should we believe your forecasts for public borrowing? His answer was pretty much wibble.
But the thing is, there's an answer which is both consistent with reasonable economics, and which defends him. It runs roughly thus:

You shouldn't believe my forecasts. Forecasts for public borrowing have always been subject to huge margins of error. There's a rule of thumb, which dates back at least as far as Nigella's dad, which says that the average error is 1% of GDP for each year of forecasting horizon - for both Treasury or private sector forecasts. That means my forecast for net borrowing of £43bn next year (pdf) should read £28-58bn, and the £38bn for 2009-10 should read £8-68bn, with a roughly one-third chance of borrowing being outside these ranges.
One reason for such big margins of error is that the government  isn't much in control of the public finances. Government borrowing is, by definition, the counterpart of private sector lending (Table I of this pdf). And this has recently been much higher than could have been expected, in two senses. First, company profits have persistently been higher than capital spending. Second, fast-growing Asian economies have generated high savings, which - because of asset shortages in the region - have been invested in developed economies such as ours; balance of payments figures (table J of this pdf) show that  foreign buying of UK debt (not just gilts) have been a record levels in recent years.
If someone's lending, someone's got to borrow. That's the government.
This flood of savings explains an important  fact - that despite the prospect of continued public borrowing, gilt yields are very low; index-linked yields are below 1%. Debt markets, then, are acting as if there's no problem with the public finances. And if the people who are stumping up the money don't seem to be worried about public borrowing, why should you be?

This answer, of course, raises other questions - not least about the fact that borrowing is only ever deferred taxation. But it answers the question about the credibility of borrowing forecasts.
But the thing is, Darling didn't say anything like this. He preferred to give the impression that he's on top of things, rather than give an economically coherent answer.
Which is why I hate Budgets. They are part of a folie a deux, in which both Chancellors and their media interlocuters pretend that it's possible to manipulate the public finances in detail. But the truth is that Chancellors don't have such control. And, with gilt yields so low, it doesn't - for now at least - much matter.

All talk

Unusually, Matthew Parris's column today misses the point. He invites us to imagine a politician who eschews grandiose rhetoric about "vision" and "renewal" actually makes real improvements:

This woman and her philosophy could take the British electorate by storm. We would fast realise how sick we have become of the overblown and confessional rhetoric of the 21st-century political communications industry.

However, Matthew fails to ask the important question. Why do we have to imagine a politician who untangles the tax credit mess, introduces a sensible recycling policy and opens GPs surgeries at sensible times? Why don't such politicians actually exist?
You know my answer - it's because the sort of management expertise that would enable a politician to do such things is just unattainable. Almost no-one can manage big organizations from the top down.
In this sense, politicans do not choose "overblown rhetoric" rather than humble competence. Such competence is not available to them. Their rhetoric is an effort to cover up this fact, to offer the appearance of managerial competence in place of the substance thereof.
They are like those charlatan authors of self-help books who add "PhD" after their names. They hope that if they draw attention to illusory credentials, no-one will notice that they're offering nothing else. Vacuous talk is all they have.

Incompetence & the crisis of the Left

The Boss Party's incompetence at managing things is the result of a deeper intellectual crisis. This thought struck me whilst reading this:

Ed Miliband, who clearly disliked all talk of an early election, has admitted that ministers are “probably undertrained” for their jobs...
Nick Raynsford, a decent minister sacked without good cause by Blair, echoes him: “The only difference I would take with him is his use of the three letters ‘der’ in undertrained. There is no organisation in the world with similar responsibilities which is as utterly cavalier as British government about the capability of people it puts into ministerial positions.” Another former minister told the Guardian: “It’s hopeless. I was appointed before the weekend and was making big spending decisions on the Monday.”
France deploys professionals from institutes of administration. Here few ministers have even run the proverbial whelk stall.

But why are members of the Boss Party so badly equipped to be managers? This should be impossible for any proper, thinking, leftist party. I say so for two reasons.
1. For years, one big political question has been: what should the state do and what should the market do? You can't answer this without a knowledge of transaction cost economics, as developed by Coase (pdf) and Williamson, which asks: what are the relative merits of arranging a transaction through the market versus within an organization? And this in turn raises the question: what can an organization do to maximize the benefits of having the transaction done in house?
Any leftist with a genuine interest in the proper boundaries of the state would therefore have developed an interest in how to manage things.
2. Another question any truly egalitarian party should ask is: why do workers have so little power? Why must they be vulnerable to managers' whims? This leads to questions of the relative merits of hierarchy versus more egalitarian management structures.
So, there are two paths which lead the Left to an interest in management. And yet almost no-one in the Boss Party took either path. They seem to take it for granted that the state and hierarchy are good ways of organizing things, without showing the foggiest interest in why this should be, or how they can make it true.
Nick Cohen is fond of pointing out how the far left has lost its intellectual moorings and drifted into mindless sectarian babble. But the same can be said for the government too.

Chrissy elsewhere

At Liberal Conspiracy - the Left vs Hierarchy.

Public sector bosses

Simon Parker tries to defend high pay for public sector bosses against this, and fails badly. He says:

People who call for more efficient government need to recognise that the only [emphasis added - CD] way to get it is to appoint excellent chief executives and senior managers to key jobs - and excellent people don't come cheap.

First, getting excellent chief executives is certainly not the only way to get more efficient government. The reason why the private sector is more efficient than government is not that it has more excellent bosses, but that it has competition. And competition at least weeds out the least efficient performers.
Second, decent bosses can come cheap. The Institute of Directors reports (pdf) that the  average managing director of a firm with turnover below £5m gets a basic salary of just £65,000. One with a turnover of £50-500m gets £141,440. These are decent professional salaries, but not a fortune.
And the survey also finds that public sector bosses are already paid more than private ones, at least outside financial companies (which are managed so much better, of course).

Demand as ideology

Imagine a parallel world. In it, office cleaners are very well paid. This is because most people believe a clean office is vital for an organization’s productivity. Germs in the office cause sick building syndrome which not only leads to absenteeism, but reduce the effectiveness of workers by  putting them under the weather. In contrast, a clean office boosts productivity by raising morale as well as health.
Of course, there‘s a huge supply of people who can clean offices half-well, the world thinks. But there‘s only a handful of people with the ability to clean it really well. To attract, motivate and retain these super cleaners, salaries have to be high.
In this world, there are some rebels, who question the contribution cleaners make to organizational effectiveness. But these are dismissed as cranks.
By contrast, in this world, bosses aren’t especially well paid. Sure, there’s a need for people to co-ordinate different departments and organize things, this world thinks. But these are good professional skills, justifying decent professional salaries but no more. Sure, it’s possible that a super-manager could add lots of value to an organization. But our chances of spotting such a boss are small, and the costs of getting it wrong are high. Better just to look for someone who meets the basic requirements for the job, the wordl thinks.
I raise this thought experiment for two reasons. First, to ask: why, exactly, is this world wrong? Second, to show a point that’s overlooked - that the forces of demand and supply that cause high or low salaries can be ideological constructs. In our parallel world, ideology creates a high demand for cleaners and low one for bosses. In our actual world, things are reversed.
Which brings me to this, via the Taxpayers Alliance:

The top 300 bosses in the state sector saw their salaries increase 12.8% last year, boosting their pay to an average £237,564, according to a public sector “rich list”. Seventeen earned more than £500,000 per year.

Bloggertarians will spout the usual about this. What they’ll miss is the true fault of New Labour the Boss Party that has caused such waste - that it has unquestioningly adopted an ideological faith in managers.
Yes I know I sound like a broken record here. I’ll shut up if and when others start talking about it.

The leadership illusion

It looks as if the Lib Dems are falling into the error that blighted the Tories for years after 1997 - believing that their problems will be solved, if only they can find the right leader.
This highlights one of the paradoxes of our political culture: that as the real world has become increasingly sceptical in recent years about the power of leadership, political parties have become more obsessed with it.
Outside of politics, we've learnt since the around the mid-80s that decentralized decision-making often works best - this is the lesson of the collapse of the Soviet Union; that individuals lack the knowledge or cognitive power to control big organizations; that there's wisdom in crowds rather than in centralized organizations; that self-managed structures are more flexible than top-down ones; and that network governance deals better than hierarchy with complexity.
Sensible organizations have learnt from this - hence the delayering of many corporate bureaucracies and growth of outsourcing. It's a very dim firm these days that thinks the personality of its chief executive matters more than corporate structure, strategy or market positioning.
But when we look at political parties, we see the opposite development - an increasing obsession with leadership and centralism; just look how party conferences have declined from policy-making bodies to mere rallies.
I suspect one reason why increasing numbers of us aren't voting or joining mainstream parties is a dissatisfaction, albeit inarticulated, with this fixation upon leadership.
This raises the question: why are the parties out of step with public sentiment and intellectual developments?
Undoubtedly, the MSM is part of the story. Its obsession with personalities rather than difficult questions of policy, allied to journalists' natural tendency to cringe in front of wealth, power and "senior sources", encourages the leadership illusion.  But is this the whole story?

Negative credibility

Take three recent events:
1. Gordon Brown says there's little interest in a petition calling for an early election, leading thousands of people to sign the petition they had previously ignored.
2. When Schillings try to stop Craig Murray making allegations against Alisher Usmanov, hundreds of bloggers and MEP Tom Wise refer to those allegations, giving them far more publicity than they'd have got if Schillings had done nothing.
3.  After the FSA, Chancellor and British Bankers Association say Northern Rock is solvent, despositers rush to withdraw their money from the bank.
These are examples of statements by the ruling class - politicians, lawyers, bosses - being wholly counter-productive, leading to events that would probably not have happened had they stayed quiet.
These might just be examples of counter-suggestion - and our rulers' ignorance of this shows how little they understand of human nature. 
But might something else be happening? Could it be that the ruling class now has negative credibility? Maybe people are now taking seriously the old Yes, Minister joke - that one should never believe anything until it's officially denied.
If so, doesn't this have serious implications? It means not merely that the managerial class has lost one of the weapons it can use to control us, but that the weapon, when used, actually fires upon its user.

Against "vision"

What is it with politicians and "vision"? In that laughable interview with Andrew Marr, Brown tried to talk about "my vision for the future", echoing Cameron's "vision for Britain." 
Such talk might be the normal rhetoric of party politics. But we should be wary of it, for four reasons.
1. The question isn't: what is your vision for the country? It's: what skills and tools do you have for making that vision reality? Talk of "vision" serves to distract us from questions of competence. It's a managerialist trope, intended to invite us to applaud the speaker's ideals, without questioning his skills; managerialists have "visions", skilled professionals do not.
2. "Vision" misperceives the nature of rationality.  "A cook is not a man who first has a vision of a pie and then tries to make it" said Michael Oakeshott in his essay, Rational Conduct. Rationality, to Oakeshott, is not about having big ideas. Instead, it's embedded in particular practices. A rational scientist, or cook, or lawyer, is one who knows how to answer particular questions. Likewise, a rational politician is one who understands the nature of government, its scope and limits.
3. Government is not necessarily about visions of the future. Instead, it's the art of providing a framework for people to freely pursue their own ideals, with as little conflict of interest as possible. Here's Oakeshott again:

Government, then, as the conservative in this matter understands it, does not begin with a vision of another, different, and better world, but with the observation of the self-government practised even by men of passion in the conduct of their enterprises; it begins in the informal adjustments of interests to one another which are designed to release those who are apt to collide from the mutual frustration of a collision. 

4. What's striking about both Cameron's and Brown's visions is how limited they are. If you had to have a vision about Britain, wouldn't it include something about the possibility of how changes in institutions can, in the long-run, change people's character for the better?  About how the power of the rich to control politics should be limited?  Or about how the political class woudn't be so distant from real people?  Strangely, neither Cameron nor Brown's visions include these.