The narrow path from votes of despair

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I read Sam Freedman’s Failed State: Why Nothing Works and How We Fix It with a mixture of nods of recognition and gasps of disbelief. It’s all too apparent  that – as the subtitle puts it – nothing works in aspects of life in the UK dependent in some way on the successful design and implementation of government policy (which is most aspects tbh). Those of us who have engaged with the policy world in some way will have our own experiences; the relevant chapters of the book reflect my own very accurately. What makes this an incredibly sobering book (although well-written, with humour) is the accumulation of evidence across all eight chapters, covering everything from parliament and the excessive growth of executive power, the House of Lords, political parties and the character of MPs, the judiciary, the criminal justice system, the civil service, local government, non-departmental public bodies and the media. A relentless accumulation of depressing dysfunction.

I’m very much on board with the book‘s main recommended fix, substantial devolution of power from central to sub-national governments – this is a journey I’ve been advocating since first getting involved with Greater Manchester’s case for greater powers from 2008 on. But this is not a simple matter. Many people point to the hollowing out of capacity in local government – true to some extent but one can see how to tackle that. Harder are the questions of accountability that raises. But – as the book argues – it’s hard to see any other plausible change that would shift the dial on interconnected institutional reforms. And equally hard to see how nothing can change: “Public trust in politicians and politics – never high – has crashed through the floor.” The governance travails of the Labour Government in the few weeks since the election suggest the time for something to change can’t be far away – surely? There has at least being slowly growing consensus about the need for decentralisation from Whitehall and Westminster, as a potentially feasible path for reducing the powers of an over-dominant executive branch that can’t deliver and can’t cope.

This book joins other incisive critiques and reviews of how the UK is governed – my colleague Mike Kenny led a major inquiry into the constitution, the Institute for Government documents failures across the board, and others such as Martin Stanley are excellent on specific aspects (the civil service and regulatory state in his case). It’s cold comfort that other countries are experiencing similar failures against a background of slow growth and hyper-fast social media, and colder still that in so many extremist parties are capturing the votes of despair. It’s a narrow path from today’s failures to a less disturbing outcome. The book ends posing a question to those in central government with the power and opportunity to start the process of change: if the UK goes down the path of crisis and reaction, “Politicians will find themselves asking: why didn’t we do things differently when we had the chance?”

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The welcome application of good sense to AI hype

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Summer over in a flash, autumn wind and rain outside – perhaps cosy evenings will speed up both my reading and review-posting.

I just finished AI Snake Oil by Arvind Narayanan and Sayash Kapoor, having long been a fan of the blog of the same name. The book is a really useful guide through the current hype. It distinguishes 3 kinds of AI: generative, predictive and content moderation AI – an interesting categorisation.

On the generative AI so much in the air since ChatGPT was launched in late 2022, and the persuasive debunking here is of the idea that we are anywhere close to ‘general’ machine intelligence, and of the notion that such models pose existential risks. The authors are far more concerned with the risks associated with the use of predictive AI in decision-making. These chapters provide an overview of the dangers: from data bias to model fragility or overfitting to the broad observation that social phenomena are fundamentally more complicated than any model can predict. As Professor Kevin Fong said in his evidence to the Covid inquiry last week, “There is more to know than you can count.” An important message in these times of excessive belief in the power of data.

The section on the challenges of content moderation were particularly interesting to me, as I’ve not thought much about it. The book argues that content moderation AI is no silver bullet to tackle the harms related to social media – in the authors’ view it is impossible to remove human judgement about context and appropriateness. They would like social media companies to spend far more on humans and on setting up redress mechanisms for when the automated moderation makes the wrong call: people currently have no recourse. They also point out that social media is set up with an internal AI conflict: content moderation algorithms are moderating the content the platform’s recommendation algorithms are recommending. The latter have the upper hand because it doesn’t involve delicate judgements about content, only tracking the behaviour of platform users to amplify popular posts.

There have been a lot of new books about AI this year, and I’ve read many good ones. AI Snake Oil joins the stack: it’s well-informed, clear and persuasive – the cool breeze of knowledge and good sense are a good antidote to anybody inclined to believe the hyped claims and fears.

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Techno-financial imperium

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Underground Empire: How America Weaponized the World Economy by Henry Farrell and Abraham Newman is a rip-roaring read and simultaneously terrifying. The reader is left with the clear impression of fragility in the world financial system – bad enough in itself – that could tip over into armed conflict. Eek.

The book is about the intersection of the discovery by the US of physical choke-points in the global internet with legal choke points in the world economy and financial system, globalized as it has become. Specifically, the NSA started to find it convenient, post 9/11, to start gathering data on a massive scale on financial movements through the internet. Just seven sites in the US act as bottlenecks for internet traffic, while in other countries there are a similarly small number of such sites. This realisation became the Underground Empire of the title, the deployment of a set of technical and financial mechanisms using these choke points, allowing the US “to cut off businesses and even whole countries from access to key global networks that wove the world’s economy together.”

As the book goes on to describe, the initial post-9/11 responses merged into a haphazard but ever more extensive set of policies and legal tools that enabled the US to extert increasing leverage over extra-territorial entities – not only businesses but also governments. These have included using the power and reach of the US dollar as a reserve currency and currency of trade to “persuade” the Swift network into applying US requirements to exclude for example North Korean and Iranian entities from international payments, and more recently sanctions on US chip technology or IP being exported. The authors write: “From outside, the underground empire seems like a relentless machine of domination, the product of decades of engineering. From inside, it looks quite different, a haphazard construction lashed together from ad hoc bureaucratic decisions and repurposed legal authorities.”

And yet it is a powerful empire and has contributed to increasing geopolitical tensions, and in particular US-China rivalry – although it has also, thanks to its increasingly evident power, prompted countervailing efforts to escape imperial power. But the book concludes “There is no visible exit from the underground empire. … The roots of imperium go far too deep ever to be fully torn out.” The globalisation dream of peace through markets has turned into a nightmare of potential conflict thanks to the realisation elsewhere that markets are built on the foundations of American physical, financial and intangible infrastructure. The book concludes that it is up to the US now to turn the empire into more of a commonwealth, serving the interests of others as well as itself – something hard to see happening in the current political moment.

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Where did summer go?

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Already September 1st, and a tang of autumn in the morning air. I had a two-week holiday with no laptop or emails, and lots of reading. Then a two-week scramble to catch up with the accumulated email and work. So here is a summary of the books I got through.

A couple were directly about AI: I, Warbot: The dawn of artificially intelligent combat by Kenneth Payne and The Age of AI by Henry Kissinger, Eric Schmidt and Daniel Huttenlocher. This is not at all my territory but it seemed a good idea to learn something about AI and conflict as we have a relevant project at the Bennett Institute. Both left me pretty terrified, particularly the former: “The warbot doesn’t want anything and it isn’t troubled by our moral dilemmas,” writes Payne. The delegation of decisions from the localized (is that person spotted by facial recognition a valid target?) to the global (is it time to launch a major attack) to AI seems inevitable; the book ends calling for serious reflection. Indeed. As for the other, I certainly know less about geopolitics than do the authors, but some of the claims on which the geopolitical analysis is constructed seem over the top. The book suggests AI is changning the human relationship with reason, challenging the possibility of a free society and free will, and that we will be letting AI decide for us when we have ambiguous contexts or goals. “The boundary between AI and humans is strikingly porous,” they write. The book concludes AI is significantly changing human consciousness and moving us “close to knowing reality beyond the confines of our own perception.” Hm. It’s doing all sorts of things but I’m not sure about this kind of claim. I like better my colleague Neil Lawrence’s reflections in The Atomic Human on humanity in the light of AI.

Screenshot 2024-09-01 at 15.02.03My favourite read about tech was Scott Shapiro’s Fancy Bear Goes Phishing: The dark history of the information age in five extraordinary hacks. The book pulls off the impressive feat of being a cracking good read with compelling stories and a super-clear technical explanation of why the internet is so easy to hack. (Incidentally, the name Fancy Bear for the notorious Russian state hackers was devised by the co-funder of CrowdStrike, the company that became famous for triggering Microsoft’s global Blue Screen of death meltdown while I was away. And ironically, the book explains that Microsoft had already improved its safeguards so that developers accessing the kernel would be far less likely to trigger a Blue Screen event.)  One thing I particularly liked about the book was its designation of ‘downcode’ and ‘upcode’, the former being the computer code of all the various types, the latter the societal laws, regulations and norms within which the internet operates. “Change the upcode and you will change the kind of downcode produced.” Highly recommended.
Screenshot 2024-09-01 at 15.04.40I also enjoyed Shane O’Mara’s Talking Heads: How Conversation Shapes Us, which the publisher kindly sent to me. A book about neuroscience, it argues that thinking requires memories, and memories are collectively constructed through conversation. Our individual memory systems contribute to a cultural memory repository. “A society without memory has no capacity to repair itself, it has no capacity to evolve, it has no capacity to adapt, it has no capacity to remember or learn.” There is a two-way process of individual thoughts shaping the collective and in turn being shaped by them. Conversations or narratives or other cognitive artefacts enable co-ordination and collective action. (This reminded me of my friend Celia Heyes’ concept of Cognitive Gadgets.) Thus nationalism is a cognitive concept and needs a psychological understanding. The book doesn’t discuss social media directly but clearly the way we have conversations about the world has changed as a result, and not in a good way.

On with the gloomy theme. I was looking forward to Abby Innes’s book Late Soviet Britain: Why materialist utopias fail not least because the title is so brilliant. It has three parts. The first argues that central planning and the neoclassical competitive economy are equivalent – as indeed formally they are, one where quantities adjust and one prices. Francis Spufford’s superb book Red Plenty dramatizes this equivalence. (This isn’t cited here – I think the author would enjoy it.) I was mildly annoyed by the book’s referring to the ‘materialism’ of both – the former Soviet bloc certainly measured material product but the western metric of domestic product is 80% non-material. But maybe there’s a technical meaning of materialism I don’t know.

The second part of the book describes the growing dysfunctions of neoliberal regimes in the west, whereby the concepts of neoclassical economics and market primacy were translated into political practice. For instance, New Public Management, the book argues, has failed just as central planning failed in practice, by incentivising individuals to deliver to target rather than the genuine aim (and just as machine learning systems fail due to their ‘alignment problem’, automated New Public Management if we’re not careful). The third, short, section is a brief history of Britain’s political evolution – why we did Brexit and why the Conservatives are in a mess.

The whole didn’t quite come together for me because I couldn’t follow the step from the formal theoretical equivalence of the two ‘ideal’ economic models to the argument that “actually existing neoliberalism” was as doomed to failure as central planning. Neither system in practice was very similar to the theoretical ideal. For instance, New Public Management was arguably a quantity-planning mechanism rather than a market mechanism. But the book’s central construct is a stimulating idea and I enjoyed reading it.

Screenshot 2024-09-01 at 15.07.08Finally in the non-fiction, Anne Applebaum’s short and compelling

, pointing out the emergence of autocracy as a global, internet-enabled business model. Time to pull the plug on the enabling industry of lawyers, accountants and bankers. What will it take to get other nation-state governments to stop supporting hostile autocrats by permitting their business interests to carry on unimpeded?

Screenshot 2024-09-01 at 15.09.05Along with all these I read a ton of fiction, from detective novels (Elly Griffiths, Donna Leon, C.J. Sansom) to Sarah Perry’s terrific Enlightenment, Atsuhiro Yoshida’s sweet Goodnight Tokyo (a taxi driver version of my favourite TV programme Midnight Diner*) all the way to the seriously serious Solenoid by Mircea Cartarescu (a gift from a Romanian former student).

* A good illustration of why Netflix is a poor substitute for domestically-produced programmes, if you compare the 1st series with the Netflixed later ones.

 

Standards

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Colleen Dunlavy’s Small, Medium, Large is an interesting and thought provoking read – and relevant to today’s debate on industrial policy. It’s a relatively short book, a history of the emergence of standards in US goods in the 1910s and 1920s. For example, in 1918-21 there were 78 different mattress sizes on the market and in 1922 the industry agreed to bring this down to 4 standard sizes, the ones we still use in the US and UK (apart from Ikea’s!). I write ’emergence’ but the book tells the fascinating history of the way industry agreements were brokered by the US government. During the years of US participation on World War 1 this was for reasons of prioritising production capacity and materials for the war effort. In the 1920s and beyond it continued at the behest of Herbert Hoover as Commerce Secretary in a drive to improve the productivity of US manufacturing. This took places under the auspices of a division ofhte Department with the wonderful name of Division of Simplified Practice (‘Simplified Practice’ sounded less socialist than ‘standardisation’.) Making multiple models in short production runs meant US firms could not capture economies of scale. Meanwhile in the UK and Germany separate standardisation drives were under way.

Of course, this meant not giving customers what they had wanted in terms of variety and choice – it was the Henry Ford approach of any colour you like as long as it’s black. A Ford executive is quoted as saying, “We standardized the customers.”  Officials railed against the “excessive mulitiplicity of styles” as wasteful.  The customers got mass production and lower prices in return, but they were kept out of the government-organisaed co-ordination between producers. Of course, another word for this might be ‘collusion’ and the book notes the obvious tension with anti-trust policy. By definition, if competition occurs over price rather than variety or attributes, this kills small producers.

Anyway, the history was new to me, and the book set me thinking about the role of standards. There has been a proliferation of variety and personalisation of goods because the technological possibilities have made this cheap enough to do without losing the benefits of flexible and rapid manufacturing. Yet as the well-known Marc Levinson book The Box pointed out, some standards have transformative productivity effects – the GSM mobile phone standard would be another example. This seems a highly relevant question now as we continue the ‘war on carbon’ – when is avoiding waste a good rationale for enforced co-operation over technical standards? At what level of the production or technology stack should governments want standardisation – requiring collaboration – so as to enable competition and variety at higher levels – for example in generative AI now? The dimensions along which firms compete are to some extent a social choice variable.