Category: Uncategorized

Design values are values, again

Here’s a good rant against bloat and ad-tracking and everything else Maciej Cieglowski has been warning you about for years. Now, somewhere on Twitter I saw @annehelen asking why it didn’t say anything about the look and feel of the nutter right’s websites. And I also saw this project, where a classic Cranky Old Engineer type swapped media diet with a fairly classic Lib Dem Type.

Hilarity ensued. More to the point, the project was a great example of some principles I keep going on about.

Trying to keep up with the world by only reading the Drudge Report was “a nightmare,” Leija said. Drudge aggregates news stories from multiple sources on the Internet and places them in a list with the same, small headline size. I found it hard over the course of the week to know what the important stories were,” Leija said. “I felt under-informed because all that tiny text creates a sense of not being able to tell what is important. It was depressing in a strange way.”

There are several design choices to discuss here. First of all, there’s the anti-design; this is a bit like Harris+Hoole, the chain of fake independent coffee houses run by Tesco. Throughout its existence, Drudge Report has projected a lo-fi, DIY aesthetic while mostly relying for news on briefings from Republican politicians and their staffers. This reminds me a bit of the biggest category of Chinese trolls here; the ones who seem normal and then turn out to have connections in the Public Security Bureau, who know the real story.

Second, there’s the Angus Steakhouse element. Microsoft Research worked out that there’s a reason spammers are so obvious. I’ve blogged this again and again. They’re trying to put off anyone who’s likely to get wise to them, as early as possible. You can try to spot the suckers, or you can arrange things so you only ever deal with people who have already flagged themselves as suckers. Which strategy would you pick? Spammers do this, and so do notoriously horrible London restaurants. It’s ugly for a reason; if you care that it’s an ugly, dodgy-looking mess, they don’t want you there.

Third, there’s some research about typography suggesting messages that are harder to read remain in the mind longer. On the other hand, more readable messages are more likely to be read and understood. There’s a trade-off between conveying information, and making converts. Interestingly, real typographers do behave a bit like this. Signage is usually modernist sans-serif fonts, body text in books is usually a greeked serif. This blog is the opposite, which may mean I’m a clown, or perhaps that I want you to remember that post of Yorksranter’s…but come back and read it again.

So much for type. What about the other stuff? Our guinea pig listens to the radio:

“I was shocked,” Knuth said. “I had never listened to a radio station like that before. I was shocked to see that it was actually just a series of programs of Rush Limbaugh-type guys. It was wall-to-wall programming of these cranky personalities, who were engaged mainly in complaining.”

After years of listening almost exclusively to public radio, which does not take advertising, Knuth was disturbed by the amount of air time taken up by ads on The Patriot, including one ad he heard repeatedly featuring former congressman and presidential candidate Ron Paul hawking a food dehydrator.

“I was just constantly frustrated.” Knuth said. “I like to know what happens in the world, and I constantly felt like I didn’t know anything, and also frustrated by the endless sales pitches, which made me annoyed.”

This reminds me of Daniel Kahneman’s work, or more precisely the deliberately crude gloss I wrote here as Kahneman for Thugs. Specifically, Target the Depleted…and Deplete the Targeted. People are easier to convince when they’re tired, ill, or distracted. You can use this to exploit them by picking people like that. It’s possible that audience pre-selection works a bit like this; the Angus Steakhouse model likes people who are too tired and cranky to care.

You can also make them like that by yelling, pouring an undifferentiated stream of irrelevant stories at them, and by filling up the visual field with noisy graphics. Interestingly, one of the best predictors of being banned as a troll is bad English, specifically, your score on standard metrics of readability. This suggests both that trolls are depleted, and that their misspelt yelling imposes cognitive costs on those around them.

Back at the source, our cranky engineer was still cranky, especially because people on Jezebel are really sweary and aggressive and the NYT is often wrong – tell us about it! – but interestingly he seemed happier about changing radio stations because he found NPR less abrasive. In some sense he was aware of the effort all the shouting consumed on his part. And he chose to undergo a “news blackout”, supposedly for other reasons.

So yes, it’s both a style statement and an element of technique.

Are you thinking what I’m thinking?

Thinking about Michael Howard’s interview fart over the weekend, I done a twitter and they liked it:

And then I remembered the sheer weirdness of standing in Parliament Square being addressed by Alistair Campbell the other day. I think it’s fair to say I never imagined my life would take that particular turn. But now it makes sense. One of the important political dualities is between the people who represent self-control and the public face, and the people who represent letting it blurt, as Lester Bangs titled. As with all dualities, the advanced student will notice that the point is to use them in combination, whether by presenting radical content as consensus or consensus and conservatism as exciting novelty.

You could call them the Ego Party and the Party of Id, and perhaps the civil service plays the super-ego. After all, are you thinking what I’m thinking? Here’s a party political broadcast on behalf of Michael Howard. Filthy!

Then, as well as perpetrating cod psychoanalysis I’m also doing billiard-ball realism here. Parties are not homogenous. If you realise that one of the major achievements of Thatcherism was the UK becoming a central actor in the European project – ’87, ’92, and all that – it’s perhaps worth remembering that those Normal European Countries people go on about usually have two conservative parties. Very often the divide is based on how Catholics responded to the Enlightenment and the Industrial Revolution. One party is founded on the early 20th century social theory and then NATO, the other on the Counter-Reformation and the Occupation.

The UK *gained* two conservative parties during the peak years of its integration in Europe. I don’t really mean UKIP, but rather the continuing fight over whether the Tories would be more like the German CDU or CSU. Would they be a party upholding a Euro-Atlantic multilateral order – the Ego Party – or a basically revisionist movement, the Party of Id? Howard made his choice even while John Major was trying to make the opposite choice stick.

Wikipedia

So I went to the Royal Academy’s Russia exhibition yesterday, which led to me looking up oligarch/collector Petr Aven on Wikipedia. He’s Mikhail Fridman’s business partner in Alfa Group, which means ironically enough I was looking at paintings belonging to the guy whose employees built a whole fake website to confuse me about their ownership of Russian mobile operator Megafon back in 2006, but failed because I used the magic of traceroute, WHOIS, and the Firefox built-in developer console to unmask their stinking act.

Anyway, Fridman’s entry led me to this North London landmark, this related Yorkshire chemical corporation, one of their original key products, its main application, and via one of the stated alternative applications, to music, magic, its texts, their sources, and Bismarckian-era German Jewish historical scholarship that evidently had unintended consequences.

A bit like looking up Petr Aven on Wikipedia, then.

Scarcity and political complexity

So I’m watching the chute, and then the experimenters chuck down this pellet, which turns out to be some sort of libertarian riffing off my Neo-Edwardians post around the idea that perhaps the move away from a simple, Posh vs. Oiks politics is to do with the rise of post-scarcity, idea dear to the hearts of SF readers.

Now I might get snarky and point out that I can see people sleeping in doorways in central London and it was -4 degrees C last night and where’s your post-scarcity now, eh, eh? (Insert the canonical Jabbing of the Virtual Finger.) But I think it’s worth examining this a bit. What would we mean by saying that some good or other is post-scarce? Well, I would start by saying that its marginal cost is zero, or for practical purposes, that its marginal cost of production (and therefore price, for the firm in perfect competition) has fallen below the overhead cost of charging for it.

Put like that, there’s more of it about than you might think.

The obvious example is information of one kind or another. It’s not just that Google has an advertising-funded business model – it’s also evident that the marginal cost of a search is extremely tiny, so much so that it’s probably indistinguishable from zero. The economics and politics of information goods are notoriously weird, which might both reassure us that we’re onto something and also suggest that perhaps this is just some boring Internet thing with no connection to the real world. You’d be wrong, though. It’s become, if not exactly routine, not unusual for the price of electricity to become negative in some markets where there is a lot of wind or solar power on the grid. And by “some markets” I mean Germany, half of the world’s manufacturing heartland. If you have to pay people to take it away, it ain’t scarce. A lot of industrial products are stupidly cheap at scale – the canonical example is micro-electronics. Even something as drastically physical as ocean freight is very, very cheap.

The example of electricity is an interesting one. The costs of production for these sources are basically made up of equipment, i.e. panels or turbines, interest on its capital cost and construction costs, and rent, because the sun is already post-scarce. As far as the equipment goes, it is getting remorselessly cheaper or in other words less scarce, like manufactured goods in general. Interest rates are of course nobbut bugger-all at the moment, and the construction cost is getting amortised over 25 years or more for wind machines. We can see from this that there are some specific sources of scarcity:

Enduring scarcity

First up, land, which they famously aren’t making any more. Those panels have to go on somebody’s property and that somebody can charge rent. Land as such is interesting not just because it’s permanently limited in supply, but because it’s radically heterogenous. You occasionally see economists saying things like “Houses are so much cheaper in the US’s open market cities! Silly people! All you need do is move to Bismarck, North Dakota and you’ll be rich!” Which is funny, because some of the same people will also tell you that cities are important because of agglomeration effects. Even if we could create land cheaply, we couldn’t make it all be in London. Landlords are still going to be with us. And to repeat the point about agglomeration, this isn’t just because some addresses are posher than others; people create cities because they are useful and enjoyable.

Economists have a nasty habit of rolling the whole planet up as undifferentiated “land”, so it’s worth noting separately that even if goods are extremely cheap, perhaps because we were using post-scarce solar energy to keep re-using the same elements, natural capital (e.g. the atmosphere) might still be scarce. This is hard to think about because the economy doesn’t do a good job of pricing it and it ends up as an externality, aka the Big Bin of Things Not To Think About. The obvious party to eventually stick a tag on this is the state.

Transitional scarcity

Even though a lot of industrial processes are hyper-deflationary, some of the technological pathways seem very resistant to commoditisation. Countries that can barely scrape into the middle-income category manufacture cars and even aircraft, but the number of firms worldwide that can make a jet engine is still probably smaller than the number that could make a nuclear bomb, and even more so if you restrict that to ones who should make them rather than risking the passengers’ lives unnecessarily. Think about that one for a moment; Frank Whittle’s first effort ran for the first time in 1937, so it’s stayed very high technology for a long time. Similarly, electronics is incredibly cheap and incredibly deflationary, but the suppliers of tooling like ASME are a very select bunch. Software is often free, and being digital information, its marginal cost is zero. But good software, free or not, is painfully rare.

A common feature of these cases is that they are often intensive in craft skills and hard-to-automate tacit knowledge, something which is also very common in the services economy. In many ways, this branch of scarcity is defined by the fact that it’s people. It might not stay that way, which is why I categorise this as transitional scarcity. But I also did that to remind us that a transitional phase can be very long, in fact, permanent for practical purposes. That brings us to:

Artificial scarcity

Because one man’s craft skill is another’s guild mystery! Google searches are abundant, but their private-use software very much isn’t. Unlike the tacit skills of their SREs, embodied in the people who possess them, this stuff could be leaked on pastebin or deliberately released into open source, so I classify its scarcity as artificial. Artifical scarcity is created either by a monopoly or else by an act of state. As it’s basically a social decision to have it, there is no reason to think it’s going anywhere. One of the absolute classic examples of this is copyright, but perhaps the more important one today is the associated right (called the database right in Europe) to collect, use, and claim property rights in data.

And, you know, I think I see it. If everything else is getting less scarce and you own land, you’re going to be very rich. If you’re a monopolist of technology or information that’s important to the nonscarce sector (or as I remember Mark Kleiman calling it, the communist sector) you’re going to be very rich and very keen on defending that monopoly. And if you are the technology, you ought to get paid for it. So what do we see? Skyrocketing land prices, extreme inequality between individuals, and huge profits at oligopolistic technology- and data-intensive firms, which match my three forms of enduring scarcity rather nicely. And political systems that were based on the assumption of fairly high scarcity, evenly distributed between sectors, aren’t functioning well. We also see deflation, which is what you’d expect if chunks of the world economy were approaching the zero lower bound on price. Hey! Zero lower bound, didn’t I hear that somewhere? Perhaps the secular stagnation concept is how capitalism ultimately defends scarcity and the benefits it brings to the rich. There’s a thought.

To wind up, eventually, in a substantially post-scarce future, what remains scarce is what society chooses to value. What that is, and how much it gets paid, is a political decision. ***prolonged, stormy applause as the giant gilt idol representing plutocracy is toppled***

2016 in a link

This is a cracking piece of work from the Bellingcat gang. It’s also quite possibly the most grimly 2016 thing of 2016 – having to do OSINT verification on a 7-year old girl’s Twitter from the siege of Aleppo, because the trolls are denying she ever existed.

Everyone else is whining about Peter Thiel so why can’t I?

Here’s a long read on Peter Thiel’s brilliant scheme to pull brilliant young people out of boring old university and get them to take risks! with skin in the game! on the big technologies of the future. And what have they delivered? The short answer would be the square root of fuck-all. The slightly longer answer would be that they’ve produced a string of utterly trivial and unoriginal startups. In fact, it recalls nothing more than the heyday of Rocket Ventures in Berlin, cranking out slightly localised clones of Facebook, Soundcloud etc one after the other. But now, rather than the periphery copying the core, the clones are coming from inside the Valley.

In Boston, Grace Xiao, 20, is working on Kynplex, a social networking software for scientific innovations and Brian Truong, 23, is building software that replaces ads with questions for online publishers. In Durham, North Carolina, Ivonna Dumanyan, 22, is building wearable sensors for athletes. In Los Angeles, Anthony Zhang, 21, is building an on-demand food delivery app for college kids.

OK so, the first of those is a copy of Mendeley which itself is a copy of that web browser extension all the academics I know used to swear by and kept asking me if I might re-implement. The next is yet another ads company in the crashing online ad market. The next is a clone, too, and the one after that is a clone of Deliveroo, which itself is a clone of a clone. The piece’s protagonist is in ad-tech, too, and there’s even a Theranos clone in there. Apparently they’re going to get it right this time – pinky promise.

What gets me about this is the utter absence of anything like innovation or originality or indeed technology. It turns out that if you maximise the consequences of failure, people adopt solutions that they know will work for the most restricted possible definition of “work” – in this case, off-the-peg VC-friendly clone startups with minimal technology content, plus massive investment in privilege. Conformity is precisely what Thiel created, and precisely what he should have expected.

And, to be honest, what we should have expected from him. His success was built on having enough privilege to dick around until he lucked into Facebook, and on getting on the defence contracting gravy-train with Palantir. His graduates are quite clear that this is their plan, too. You stick it out through the hazing process and then you’re on the inside.

There was a look he shot me then, a look I’d come to recognize. It was the look that said, you don’t get it. Maybe his idea wouldn’t work, he said, and his company would fail. That happened. But there would be a half-dozen more ideas that he’d reach for, and after that, a half-dozen more. Each idea was just practice for realizing the next idea. And thanks to Thiel, he’d know the people — funders, engineers, advisors — that could best help him translate those ideas into companies. Yes, he could go back to Stanford any time. But why would he ever turn away from the thing that he’d started to build, which was not a company, but a network — and start all over again? This network, he contended, was far more valuable than any he could build in college — even at Stanford.

But I think it’s worth harping on the point that this isn’t the creation of an elite of technologists, but just the creation of an elite. This is not innovation and it has nothing to do with technology as such. It is just as dull and as grey as any small-town chamber of commerce. As a result, we can denounce it with confidence that we’re not losing anything but yet another cockroach startup trying to get you to turn off your ad blocker.

Blitzed: the Third Reich as a society on drugs

So my copy of Norman Ohler’s splendidly-titled Blitzed showed up. This could have been a really disappointing book – in the acknowledgments, Ohler mentions a Berlin DJ friend who told him Nazis took masses of drugs, and I can well imagine going from that beginning to lurid Hitler Channel kitsch. But Ohler has achieved so much more, and the mass of archival references in the back shows us how and why. Although this is quite a short book, it does something genuinely interesting and difficult, a new view on the Third Reich. Also, as well as the superb title, Shaun Whiteside has produced a really excellent translation of a text heavy with Nazi and bureaucratic jargon, street slang, and pharmaceutical technicalities.

Pervitin: getting cranked up from below

Where to begin? Perhaps we could kick off with the so-called discovery of fatigue back in the nineteenth century, as scientists and especially the military began to explore the limits of human performance. Obviously, there was a limit. Nutrition was involved; physical training could push the limit out further. And fascinatingly, the limit was closely linked up, in complicated ways, with the emotional and psychological forces of motivation, leadership, and unit-cohesion. Some people took this all the way to believing that the soul, the supernatural, or previously unknown physics was at work. Otto Ranke, a German physiologist, was running the German army’s medical research at the outbreak of war and specifically working on these problems.

If Nazism was anything, it was a doctrine that claimed Germany could overcome the limits of its purely material resources through the combination of new technology, inspired leadership, and ideological motivation through hatred. It was necessary to do more, push higher, go faster, succeed through will, outdo the other guy in working towards the leader. As the brilliance of Adolf Hitler and of German military commanders would inspire soldiers to triumph on the battlefield, the brilliance of great scientists and entrepreneurs wouid lead Germany to the economic triumph that was also required to win. Ohler’s first case study speaks directly to this.

The one branch of science that was most identified with Nazism was chemistry. Fischer-Tröpsch coal-to-liquids technology would provide the petrol to fuel the blitzkrieg; further advances in polymerisation would use F-T feedstocks to provide synthetic rubber and plastics. IG Farben’s money funded the party, and the party served IG Farben. We all know where this is going. But what about chemistry directed towards Germans, rather than the enemy?

Temmler-Werke of Johannisthal, Berlin didn’t invent methamphetamine – they pinched it from the Japanese – but they did do what industrial chemists mostly do all day. They scaled up the production process, nailed down consistent purity, and packaged it as conveniently shelf-stable and orally administered tablets. Pervitin was born. Then Temmler’s marketers did what pharma marketers mostly do all day; they corrupted the medical profession, lavishing entertainment, advertising, and copious free samples on every GP in Germany. Very soon you could get it in any chemist’s shop, and Germans took it in epic quantities. By mid-1941, Temmler was manufacturing 30 million “units” a month; it’s not clear whether a unit was one tablet, or a pack of 30, so it’s possible they were producing enough to give every German a couple of tabs a day.

Nazi policy on drugs was contradictory in a way that reflects Nazism. In one direction, they were very punitive – Ohler’s endnotes mention the terrifying case of a dentist accused of sampling the superbly pure Merck liquid cocaine he had access to, who was ordered to undergo compulsory detox and was gassed under Aktion T-4 the very next day – but they also conceptualised drugs as foreign, degenerate, possibly Jewish substances associated with dodgy Weimar characters. Meth, as an innovative and pharmaceutically pure product of Germany’s great chemical industries, didn’t fit into this worldview at all. And it didn’t help that it seemed to speak to Nazi aims and methods; everyone who was desperately competing for power, pushing production targets, choking down their doubts, or marching frantically across the heaths found it supremely useful and then, of course, indispensable. It fit with a society built on hyper-motivation.

In this way, Nazi Germany got cranked up on speed from below. Ohler shows a string of letters Heinrich Böll wrote home from the army during the Phoney War, asking his parents to send more Pervitin urgently because it kept him from sleeping on watch.

This brings us back to Otto Ranke. As the German army worked through a complex set of wargames to evaluate the official plan for the invasion of France versus the minority report created by Erich von Manstein, known as Operation SICHELSCHNITT, a key variable became obvious. When it took the German side less than five days to get to the River Meuse, they usually won; when they didn’t, the Allies usually did. If SICHELSCHNITT was to be implemented, nobody could afford to sleep, and Dr Ranke had just what they needed, 31 million Pervitin pills. Later, after Dunkirk, as the campaign entered its second phase of operations against Paris and the French reserve armies, Ranke made his own tour of the front distributing his own kind of resupply from a sack in his car. Where Colonel Hentsch of the General Staff had toured the Marne in 1914 spreading doubt and despondency, Staff Surgeon Ranke toured the front spreading synthetic certainty. Ohler makes a decent case that the Western campaign of 1940 was won through chemical warfare, with the unusual feature that the chemical was administered to friendly forces rather than the enemy.

(That said, Ohler’s military history is shaky on Dunkirk, where he uncritically relates the myth of the decisive halt order.)

The Wehrmacht was well satisfied, if increasingly twitchy; they ordered as much Pervitin again for each army group invading Russia.

Eukodal: Shooting up at the top

Ohler now switches focus. If the Pervitin experience got Germany high from below, what impact did drugs have on the men at the top? We’ve seen that, in an important sense, Nazism aimed to be like a drug itself; testimonies from the time are full of references to the “intoxication” of the great rallies and the leader’s speeches. And of course leadership is a drug. The motivational effects evoked by emotion are, in the end, biochemical. Nazi slang reflected this; as the war went on and got worse, the term for being cheered up by an interview with Hitler was a Betonspritze, a shot of concrete.

The relationship between dictator and subject can be seen as a drug relationship in more than one ways. For a start, there is the direct effect of the leader on the led. This also works the other way around, though. Ohler points out that Hitler’s own drug abuse began when he radically reduced his public speaking; denied the swing from stage-fright to performance high as a drug, he turned to other drugs. And how; his daily pharmacopeia included, during the winter of 1944, pervitin, barbiturates, intravenous oxycodone, cocaine, and testosterone all at once.

Addictiveness seems to have been an important and under-discussed feature of the tyrant’s personality – when he first received Eukodal, he was begging for more and drug-seeking by the end of the day, and Ohler quotes him rhapsodising to his ear, nose, and throat specialist about “that wonderful cocaine”. Perhaps that was why he was so keen on prohibition and lecturing those around about their health – was he aware of this trait and projecting? On one occasion, Hitler’s doctor miscalculated the dose and only gave him half his usual fix. Hitler was hysterical. The doctor gave him more. Hitler was delighted and pathetically grateful. Ohler glosses his meltdown in the bunker as, in part, withdrawal from opiates after the supply broke down. Certainly, he exhibited all the classic symptoms of opiate addiction, notably constipation. He also had several typical problems related to steroid use.

Morell: The dictator, his dealer, and occupied Europe

His doctor, Theodor Morell, had been best known as a sort of Dr Robert figure who served Weimar celebrity by keeping his prescribing pad open and his mouth shut, two services for which he was well paid. Ohler makes the fascinating point that, because Morell rarely gave Hitler the same shot twice, Hitler was unable to feel dependent on any particular molecule, but rather became addicted to his doctor. Looking at Morell and his bag of pills and potions, the only bag ever allowed into Hitler’s presence without search, we see much more about the Third Reich. Morell was getting hooked on Hitler. The dictator took up all his time; he was terrified of the Gestapo, and only one man could protect him from them; he couldn’t resist the financial possibilities being Hitler’s doctor gave him.

Morell managed to arrogate an aryanised drug factory in Czechoslovakia to himself and followed this up by claiming dibs on all the glands from the Ukraine’s slaughterhouses for his hormone preparations, escalating to the minister or even Hitler every time the military tried to grab back his rolling stock. Ohler quotes dozens of letters and telegrams of Morell’s badgering various officials for the glands. He had to have the glands. In a sense, he had become a vampire – sucking the blood out of the Ukraine and injecting it into the Nazi elite to keep them young. He even got a carve-out from the drug-approval regulations so that he would be allowed to sell anything he used successfully in his practice at the leader’s headquarters.

Like Morell, the German bourgeoisie didn’t like what it was getting into but couldn’t resist the opportunities, and the servitude it entered into was all the more servile for being the comfortable kind.

The closed system

A thought: every political party contains what Karl Popper would call a closed system of knowledge, rather as Lloyd George said each man has a House of Lords in his own head. This system incorporates the symbols of its identity and the tropes of its internal culture. The party also, however, must needs contain an open system of knowledge, in order to work with the institutions of the state and strategise against the opposition. If you want to achieve anything you must have one foot in both.

Today, all the parties seem to have been taken over by the closed system. So you have Kelvin Hopkins suggesting that perhaps Labour should make a priority of abolishing private health insurance, you have Liam Fox plotting to escape the EU’s ban on trade with China that only exists in his head. In Scotland, of course, it’s different – the closed system took over the country, not just a party.

I’m not sure where to go with this insight, but it doesn’t look like they’re trying to learn anything, does it?

I know, let’s put the Work Programme in charge of Brexit

So here’s the disgraced Liam Fox being all rah-rah about globalisation and free trade. You’d think in that case he’d be pretty keen on:

A single market without barriers—visible or invisible—giving you direct and unhindered access to the purchasing power of over 300 million of the world’s wealthiest and most prosperous people.

Bigger than Japan. Bigger than the United States. On your doorstep. And with the Channel Tunnel to give you direct access to it.

It’s not a dream. It’s not a vision. It’s not some bureaucrat’s plan. It’s for real

People often talk about the distinction between Keynesianism and Keynes, but check out the radical fracture between Thatcher and Thatcherites. Anyway, it’s blindingly obvious that Liam Fox, especially, is negotiating with the EU in his head. We’re looking at people with a very different mental model of reality to nearly anyone else, thrashing around in Boydian incoherence as they come up against it.

So, given that there is no shortage of civil servants who have spent decades managing the UK’s involvement in the European Union, who’s briefing them? Let’s have a look.

The all-new Department for International Trade basically consists of the UK Trade & Investment directorate, carved out of the Foreign & Commonwealth Office, plus some pieces from the Department for Business, Energy, and Industrial Strategy (i.e. BIS, DTI as was). That sounds like a good start. After all, UKTI has been assessed as being the best such agency in the developed world, which does rather raise the question as to why we’re fiddling with it and how anyone thinks the government somehow doesn’t do trade.

Its top officials are listed on its web page and profiled here by Civil Service World.

The boss, Sir Martin Donnelly, is the former BIS permanent secretary, was the FCO’s director of Europe and Globalisation, and before that, the deputy head of the Cabinet Office European Affairs Secretariat. I doubt it’s him who doesn’t know the difference between the customs union and the single market. Catherine Raines was the UKTI CEO, and before that ran AstraZeneca’s respiratory drugs supply chain among other things. John Alty is a career BIS official and the director of the Intellectual Property Office. Emma Squire was Sajid Javid’s private secretary at BIS, and before that, among other things, she ran the Treasury’s energy policy desk, the BIS nuclear desk, and the multilateral trade negotiating team.

I really doubt it’s any of these people. Not only is he evidently competent, Donnelly is actually doing two jobs, as he’s still got BEIS to run. Also, the ex-FCO people are technically on loan and the two departments are still arguing about whether they transfer over or not. Obviously, the FCO has vastly greater institutional heft in that fight. (Important CSW piece here. Interestingly, all snark aside, David Davis’ team seems quite a bit less flaky.)

Information about the new government’s SPADs is thin on the ground – neither CSW nor any of the PR firms has issued a full list like this one yet. DeSmogBlog names Fox’s press secretary David Goss, a Tory press officer. But that sounds a little bit meh.

What about this guy? Paul McComb rejoices in the title of Managing Director of Strategy UKTI and Transition Programme Director, and appears to have absolutely no relevant experience whatsoever. Better, he joins from the DWP, where he was Iain Duncan Smith’s principal private secretary and Deputy Director of Welfare Policy. Can it be…the guy who brought you Universal Credit? His LinkedIn page is here.

And that’s when I found something interesting.

Fascinatingly, a Paul McComb born in November 1967 appears in the register of companies as a director of Health and Employment Partnerships Ltd, private limited company 09431037. Astonishingly, H&EP Ltd. is actually up to date with its filings. It is classified under “Other business support services”, and it is worth pointing out here that it is not repeat not a charity or nonprofit of any kind. It is a plain-vanilla commercial company.

Is that the right McComb? The civil servant did his first university degree (Open, BSc Computer Science) in 1990. November ’67 guy would be 23 that year, which sounds a plausible age to take finals.

So what the balls is a health and employment partnership? The idea seems to be that ill people who are out of work have two problems, and dealing with them both might be sensible. But the combination of indifference, judgementalism, and relentless boosterism that characterised IDS’s – or shall we say Paul McComb’s – DWP can be counted on to take a reasonable idea and make it hellish. It doesn’t even take the length of this short blogpost to get from there to embedding Work Programme badgering into GP surgeries. So why do you think you’re anxious GET A JOB and JOB depressed OR WE’LL DOCK YOUR BENNIES then DON’T SWEAR WE HAVE A BEHAVIOUR POLICY WELL YOU SHOULD HAVE GOT THE LETTER?

And, it turns out, McComb and friends saw themselves implementing this on the other side of the table.

Social Finance has developed a new platform to co-commission health and employment services in partnership with a range of potential commissioning partners. HEP is a wholly-owned social purpose company whose mission is to work with commissioners, providers, and social investors to roll out best practice and innovative approaches to improving the wellbeing of people with health issues, through supporting them into employment.

“Social purpose company”; I like that. You might think that meant it was a company limited by guarantee not for profit. As we saw earlier, it isn’t. There’s more detail of what they were planning in this presentation; the whole idea was bound up with another wizard wheeze, social impact bonds. There’s a pilot project in Islington, funded out of Islington’s budget, which drew an angry demo – interestingly, another H&EP Ltd director is a top Islington Council official.

Is this really appropriate? It seems that people commissioning from this entity, with your money, are also directors of this entity and potentially beneficiaries of it.

Beyond that, I think this is really worrying. DWP was both the most ideologically warped department under the last government, and the least administratively effective. While McComb is settling into the DIT offices, aka a cupboard in the Foreign Office, the new minister, Damien Green, is in the process of shutting down IDS’s comedy crusades.

If there is one thing Britain’s trading relationships post-referendum don’t need, it’s the culture of Iain Duncan Smith’s DWP.

A clear statement about migration

I wrote this for Politico Europe, but they weren’t interested after much editing about. Apparently there were too many charts.

A clear statement about migration, says Theresa May of the vote for Brexit. The last thing you’ll find in the data is clarity. Or migration.

There has been a wealth of efforts to understand Brexit through data. But the most telling statistic in most of them is the R^2 value, the measure of how well a regression line fits the data. The higher the R^2, the more of the spread in your data you’ve managed to explain. Famously, although there is a faint correlation between some measures of migration and the vote, the R^2 value is pathetic – the data set is nothing but outliers.

It gets worse. Some analysts tried to save migration as an explanation by looking at the change in foreign-born population, rather than its level. This chart from The Economist is the classic statement. Perhaps the voters were shocked and bewildered by the speed of change, rather than its content, or something like that. Or maybe it’s a soft racist argument like Jacques Chirac’s Le bruit et l’odeur speech.

econochart

The problem is, again, the R^2 – without a very few extreme outliers, mostly very conservative small towns in the Fens with significant numbers of migrant farm workers, there wouldn’t be any effect at all, as Jo Mitchell points out here. You’ll notice they didn’t quote an R^2.

It gets still worse, though. Those outliers are dramatic, but they disappear when we control for the size of their population (from here). Small populations exaggerate all percentage changes; they show extremely high rates of immigration precisely because they have so few immigrants, and even if they voted Leave by a big margin, they had little impact on the contest because they have so few voters. We can deal with this by plotting votes rather than percentages – I’ve plotted the net Leave lead, i.e. Leave minus Remain, giving us each local authority’s contribution to the overall result.

brexitimmigrationvotes

As you can see, the Fenland outliers have vanished and so has the correlation. It makes sense; nobody ever won a general election in South Holland and the Deepings, a constituency that has been Conservative since 1922. Instead, a clutch of populous, Leave-leaning but contested, urban but not metropolitan districts emerge as the key battlegrounds. Dudley, for example, contributed 61,666 net Leave votes.

Let’s try something else. One argument – classically put by Daniel Davies in Vox – is that the problem is migration, but it’s internal migration. Post-industrial northern towns and the run-down seaside are emptying out as the young seek opportunity in the big city. It’s an elegant argument, with all the more emotional force because both Dan and I did just that ourselves. Unfortunately, the data doesn’t stand it up.

brexitinternalmigration1

In fact, it’s the other way round, the correlation is quite strong, and the R^2 is at least less bad. This seems baffling; London is actually more populous now than it’s ever been, and deeply Remainy. Also, Cornwall is hardly the land of opportunity. The explanation may be age structure – young people flock into the big cities, retirees go the other way – but we’re already trying to save our hypothesis by fitting stories to an unconvincing data set. It needs a lot of nuance.

What about total population growth? Sorry, but that’s even less helpful.

brexitpopulation

We could try some other approach. The Right is convinced it’s all about immigration. The Left is convinced it was a massive protest vote about austerity. This is hard to test because there is no official data on total government spending by locality. Without it, we’d have to build our own private hell of cost-allocation problems. The Centre for Cities managed to create a snapshot for 2013-2014, but austerity is all about change in the fiscal stance. Also, a Keynesian would object that the allocation of the government deficit is what counts, so we’d need tax revenue data as well. And, anyway, it doesn’t tell us much.

brexitausteritycentral

There is, however, data for spending by local governments. A large fraction of the UK austerity programme consists of cuts to the Department for Communities and Local Government’s financing to town councils, so this ought to be a useful proxy for total spending.

We don’t find much correlation with the level of spending. But we do with the change from 2012-2016. Austerity, defined as the reduction in local government spending power, predicts about 20% of the variation in the net vote for Leave.

brexitausterity

Another variable that does seem to have some predictive power is pay. The short-term change in median gross weekly earnings doesn’t seem to matter, but their level does, quite strongly. In fact, it’s better than austerity as a predictor; it’s the best one I found, with R^2 of 0.23. I ran the same analysis, using the Annual Survey of Hours and Earnings data set, for the 25th, 75th, and 90th percentiles of earners, but I didn’t find anything interesting.

brexitpay

So, it looks like the immigration story is a bust. The internal migration one might be saved with a lot more nuance, and you know what they say about nuance? And a pretty direct leftwing story about austerity and poverty seems to work better than anything else. Until you actually look at poverty itself. The standard measure of poverty in Britain is the government’s Index of Multiple Deprivation, which sums up a gaggle of social evils as a handy score.

This is interesting because the IMD tells us what happened after the welfare state did its thing – it’s a measure of poverty and inequality after redistribution, while the ASHE is a measure of income as determined by the market, before taxes and transfer payments. And the IMD doesn’t seem to show any correlation at all.

brexitpoverty

Now this is interesting. A major economic and political orthodoxy throughout the world since the late 1980s has been that economic change, however jarring, is basically healthy because the winners can compensate the losers through the tax and transfer system. This doctrine was the source of legitimacy for the whole free-trade agenda – NAFTA in the States, Single Market completion and the Eurozone in Europe. And now it’s breaking down. Transfers don’t buy legitimacy, and maybe they never did.

For the UK, there’s an important and difficult problem here. The UK doesn’t do regional policy well, but redistribution of income between regions does happen to a very significant extent. Leaving aside the rows about the Barnett formula and Scottish oil, let’s just remember that 30% of all taxes paid in the UK are paid by Londoners, who make up 13% of the population. How much more are you going to ask them for?

Part of the problem is that redistribution must be done, but it must also be seen to be done, like justice. The UK, very unusually among federations, doesn’t really have an explicit political process to determine how government spending is divvied up. There’s no equivalent of a Länderfinanzausgleich. Therefore, it’s hardly surprising nobody thinks they have any control over it.

This also suggests another way economic unions fail. It’s a commonplace that the Eurozone is troubled because it lacks both a big discretionary budget and full labour mobility, unlike the United States or Germany. Therefore, bits of it can end up with an inappropriate real exchange rate and high unemployment for an indefinite period of time. But the UK doesn’t have any language barriers, and it does have a big federal budget. You could say the same for the US. However, bits of it still seem to end up stuck in a low-income equilibrium for decades.

Perhaps that internal migration hypothesis deserves another look? Perhaps, without explicit and forceful regional policy, some places just empty out? And does that remind anyone of Donald Trump?