Monthly Archives: February 2020

The economic consequences of George Osborne

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Last September there was a terrific conference in King’s College, Cambridge to celebrate the centenary of the publication of John Maynard Keynes’s famous pamphlet, The Economic Consequences of the Peace. In a mischievous spirit in the months before the event, I tried to persuade a well-known economist of my acquaintance to compose another pamphlet, The Economic Consequences of George Osborne, that we could unveil on the weekend before the Keynes conference.

Osborne, as most people know, was Chancellor of the Exchequer in the Coalition and Tory governments led by David Cameron following the 2010 general election. In that role he was the prime architect of the ‘austerity’ policy of slashing public expenditure (and therefore welfare benefits) using the preposterous rationale that somehow the public deficit brought about by rescuing the banks was due to extravagant spending by a Labour administration living beyond the country’s means. In fact, working on the principle that one should never let a good crisis go to waste, Osborne used this rationale as a cover for what he always had been seeking to do, namely to shrink the state in best Hayekian style.

Sadly, my tame expert was unable to help with the pamphlet, having been unexpectedly headhunted for a demanding role which left him little time for entertaining pursuits. So the booklet remained unwritten — until now.

But it has just surfaced under a different title and with a different set of authors. It’s  Health Equity in England: The Marmot Review 10 Years On, written by a team led by Professor Sir Michael Marmot. Although the authors are much too polite and reserved to put it like this, the report shows that the consequences of George Osborne are as numerous and bleak as I had supposed. British subjects can expect to spend more of their lives in poor health, for example. Improvements to life expectancy have stalled, and declined for the poorest 10% of women. The health gap has grown between wealthy and deprived areas. And place really matters – living in a deprived area of the North East is worse for your health than living in a similarly deprived area in London, to the extent that life expectancy is nearly five years less.

In more detail, the research underpinning the report says:

  • Since 2010 life expectancy in England has stalled; this has not happened since at least 1900. If health has stopped improving it is a sign that society has stopped improving. When a society is flourishing health tends to flourish.
  • The health of the population is not just a matter of how well the health service is funded and functions, important as that is. Health is closely linked to the conditions in which people are born, grow, live, work and age and inequities in power, money and resources – the social determinants of health.
  • The slowdown in life expectancy increase cannot for the most part be attributed to severe winters. More than 80 percent of the slowdown, between 2011 and 2019, results from influences other than winter-associated mortality.
  • Life expectancy follows the social gradient – the more deprived the area the shorter the life expectancy. This gradient has become steeper; inequalities in life expectancy have increased. Among women in the most deprived 10 percent of areas, life expectancy fell between 2010-12 and 2016-18.
  • There are marked regional differences in life expectancy, particularly among people living in more deprived areas. Differences both within and between regions have tended to increase. For both men and women, the largest decreases in life expectancy were seen in the most deprived 10 percent of neighbourhoods in the North East and the largest increases in the least deprived 10 percent of neighbourhoods in London.
  • There has been no sign of a decrease in mortality for people under 50. In fact, mortality rates have increased for people aged 45-49. It is likely that social and economic conditions have undermined health at these ages.
  • The gradient in healthy life expectancy is steeper than that of life expectancy. It means that people in more deprived areas spend more of their shorter lives in ill-health than those in less deprived areas.
  • The amount of time people spend in poor health has increased across England since 2010. As we reported in 2010, inequalities in poor health harm individuals, families, communities and are expensive to the public purse. They are also unnecessary and can be reduced with the right policies.
  • Large funding cuts have affected the social determinants across the whole of England, but deprived areas and areas outside London and the South East experienced larger cuts; their capacity to improve social determinants of health has been undermined.

I could go on, but you will get the point.

Since being unceremoniously sacked by Theresa May, Osborne has led an exceedingly comfortable life, topping up the income from his family Trust Fund with a lavish salary as Editor of the London Evening Standard and £650,000 for working one day a week for the investment fund Blackwater.

The low-down on COVID-19

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From The Atlantic:

Coronaviruses are similar to influenza viruses in that they are both single strands of RNA. Four coronaviruses commonly infect humans, causing colds. These are believed to have evolved in humans to maximize their own spread—which means sickening, but not killing, people.

By contrast, the two prior novel coronavirus outbreaks—SARS (severe acute respiratory syndrome) and MERS (Middle East respiratory syndrome, named for where the first outbreak occurred)—were picked up from animals, as was H5N1. These diseases were highly fatal to humans. If there were mild or asymptomatic cases, they were extremely few. Had there been more of them, the disease would have spread widely. Ultimately, SARS and MERS each killed fewer than 1,000 people.

COVID-19 is already reported to have killed more than twice that number. With its potent mix of characteristics, this virus is unlike most that capture popular attention: It is deadly, but not too deadly. It makes people sick, but not in predictable, uniquely identifiable ways. Last week, 14 Americans tested positive on a cruise ship in Japan despite feeling fine—the new virus may be most dangerous because, it seems, it may sometimes cause no symptoms at all.

Krugman on Bernie

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From today’s NYT. He’s not overly impressed by Sanders, but…

I’m more concerned about (a) the electability of someone who says he’s a socialist even though he isn’t and (b) if he does win, whether he’ll squander political capital on unwinnable fights like abolishing private health insurance. But if he’s the nominee, it’s the job of Dems to make him electable if at all possible.

To be honest, a Sanders administration would probably leave center-left policy wonks like me out in the cold, at least initially. And if a President Sanders or his advisers say things I think are foolish, I won’t pretend otherwise in an attempt to ingratiate myself. (Sorry, I’m still not a convert to Modern Monetary Theory.) But this is no time for self-indulgence and ego trips. Freedom is on the line.

The real test of an AI machine? When it can admit to not knowing something

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This morning’s Observer column on the EU’s plans for regulating AI and data:

Once you get beyond the mandatory euro-boosting rhetoric about how the EU’s “technological and industrial strengths”, “high-quality digital infrastructure” and “regulatory framework based on its fundamental values” will enable Europe to become “a global leader in innovation in the data economy and its applications”, the white paper seems quite sensible. But as for all documents dealing with how actually to deal with AI, it falls back on the conventional bromides about human agency and oversight, privacy and governance, diversity, non-discrimination and fairness, societal wellbeing, accountability and that old favourite “transparency”. The only discernible omissions are motherhood and apple pie.

But this is par for the course with AI at the moment: the discourse is invariably three parts generalities, two parts virtue-signalling leavened with a smattering of pious hopes. It’s got to the point where one longs for some plain speaking and common sense.

And, as luck would have it, along it comes in the shape of Sir David Spiegelhalter, an eminent Cambridge statistician and former president of the Royal Statistical Society. He has spent his life trying to teach people how to understand statistical reasoning, and last month published a really helpful article in the Harvard Data Science Review on the question “Should we trust algorithms?”

Read on

Ministers who can’t count

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Pritti Patel, the current British Home Secretary (third from left, top row), recently introduced the UK’s “tough” new points-based immigration system that will come into force on January 1, 2021. Faced with criticism that the system will severely impair certain sectors of British industry, Ms Patel asserted that the new rules will be a golden opportunity for 8.48m “economically inactive” British people between the ages of 16 and 64 to join the workforce.

Writing in today’s Financial Times, Bronwen Maddox points out that, according to the Office of National Statistics, 2.3m of those are students, 2.1m are long-term sick or disabled, 1.9m are looking after their family or home, 1.1m are retired and 160,000 are temporarily sick. This leaves 1.87m who might like a job and do not have one.

Perhaps one of them would like a job in the Home Secretary’s office, handling the arithmetic.

Some historical perspective on the dominance of current tech giants

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From this week’s Economist:

As big tech’s scope expands, more non-tech firms will find their profits dented and more workers will see their livelihoods disrupted, creating angry constituencies. One crude measure of scale is to look at global profits relative to American GDP. By this yardstick, Apple, which is expanding into services, is already roughly as big as Standard Oil and US Steel were in 1910, at the height of their powers. Alphabet, Amazon and Microsoft are set to reach the threshold within the next ten years.

Remember what happened to Standard Oil and US Steel?

Quote of the Day

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“As big tech’s scope expands, more non-tech firms will find their profits dented and more workers will see their livelihoods disrupted, creating angry constituencies. One crude measure of scale is to look at global profits relative to American gdp. By this yardstick, Apple, which is expanding into services, is already roughly as big as Standard Oil and US Steel were in 1910, at the height of their powers. Alphabet, Amazon and Microsoft are set to reach the threshold within the next ten years.”

  • This week’s Economist.

If tech companies think they’re states, then they should accept the same responsibilities as states

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It’s amazing to watch the deluded fantasies of tech bosses about their importance. In part, this is because their pretensions are taken seriously by political leaders who should know better. The daftest move thus far in this context was the Danish government’s decision in 2017 to appoint an ‘ambassador’ to the tech companies in Silicon Valley, but it’s clear that some other administrations share the same delusions.

Marietje Schaake, the former MEP who is now International policy director at Stanford’s Cyber Policy Center, has noted this too.

Last month, Microsoft announced it would open a “representation to the UN”, while at the same time recruiting a diplomat to run its European public affairs office. Alibaba has proposed a cross-border, online free trade platform. When Facebook’s suggestion of a “supreme court” to revisit controversial content moderation decisions was criticised, it relabelled the initiative an “oversight board”. It seems tech executives are literally trying to take seats at the table that has thus far been shared by heads of state.

At the annual security conference in Munich, presidents, prime ministers and politicians usually share the sought-after stage to engage in conversations about conflict in the Middle East, the future of the EU, or transatlantic relations. This year, executives of Alphabet, Facebook and Microsoft were added to the speakers list.

Facebook boss Mark Zuckerberg went on from Munich to Brussels to meet with EU commissioners about a package of regulatory initiatives on artificial intelligence, data and digital services. Commissioner Thierry Breton provided the apt reminder that companies must follow EU regulations — not the other way around.

In a brisk OpEd piece in yesterday’s Financial Times, Schaake reminds tech bosses that if they really want change, there is no need to wait for government regulation to guide them in the right direction. (Which is their current mantra.) They own and totally control their own platforms. They can start in their own “republics” today. Nothing stops them proactively aligning their terms of use with human rights, democratic principles and the rule of law. When they deploy authoritarian models of governing, they should be called out. “Instead of playing government”, she writes,

they should take responsibility for their own territories. This means anchoring terms of use and standards in the rule of law and democratic principles and allowing independent scrutiny from researchers, regulators and democratic representatives alike. Credible accountability is always independent. It is time to ensure such oversight is proportionate to the power of tech giants.

Companies seeking to democratise would also have to give their employees and customers more of a say, as prime “constituents”. If leaders are serious about their state-like powers, they must walk the walk and treat consumers as citizens. Until then, calls for regulations will be seen as opportunistic, and corporations unfit to lead.

Bravo! Couldn’t have put it better myself.