Thursday, 6 August 2015

The boneheaded conservatism of the BBC

You don't have to be what used to be called 'right wing' to be conservative.

Tony Blair made a speech in 1999 about what he called the "forces of conservatism". It wasn't perhaps clear then, as it is now, that he was part of these same forces himself in his deference to the most powerful player in any situation - political realism, taken to those lengths, is preternaturally conservative.

But the same is also true of his nemesis, Jeremy Corbyn. Harking back to the solutions and institutions of the 1970s - the CEGB, the Ministry of Prices and Consumer Protection, the DHSS - may seem fresh because it is all a long time ago, but it is just as conservative in its own way.

But, I fear, the most conservative of them all is the BBC - in its determination that the only political issue is the size of the state.

I found myself chewing the carpet with frustration over their coverage of the RBS sell-off - pitting a Treasury statement against one from Corbyn himself, and then leaving it lazily at that.

It doesn't seem to occur to the BBC political editors that the issue isn't that at all.  There aren't many of us, except for Corbyn, who want to keep RBS in state ownership forever.  Or even those who believe that every penny of the bail-out should be paid back.  

Why don't they understand that the main objection to George Osborne's plans are its sheer waste? Why do we want to return RBS to its tiny group of dysfunctional and corrosive financial giants - when nothing has been done to solve the basic problem? There are no local lenders capable of nurturing the UK SME sector. Every other European country bar Hungary has this; we don't.

The truth is that the besetting sin of the BBC is not left-wing bias, it is boneheaded conservatism.  See my chapter on the BBC in Eminent Corporations to see what I mean.

It was ever so. Once the General Strike hit them in 1926, the director-general Reith solved the problem as all his successors solved the problem after him, sooner or later. To stay independent, to avoid being ordered about by ministers, there really was only on strategy available – and that was to do what they were told. Preferably before they were told.

The Chancellor of the Exchequer Winston Churchill demanded that the BBC should be subsumed into his propaganda operation. The daily newspapers could not print. Only the BBC remained as an ‘objective’ source of news – but how objective could they be? 

Reith cleverly hitched his wagon to that of the more moderate Prime Minister Stanley Baldwin, and persuaded him to insert a short passage about into his broadcast about “longing and working and praying for peace”.

He also banned Labour speakers and any supporters of the strike from the microphone. With relief, nine days later, Reith was reading the news himself when the rumours emerged that the strike was over and the BBC had not succumbed to direct government control, at least formally.

“We do not believe,” he wrote afterwards, “that any other government … would have allowed the broadcasting authority under its control greater freedom than was enjoyed by the BBC during the crisis.”

Like a medieval church, the BBC’s inner priesthood came to believe that the defence of their independence was their predominant objective. Their right to inform and inspire, as they saw fit, to discharge the sacred duty of providing quality programmes, had to be unsullied by the dull compromises of politics. 

They were right, but this meant tiptoeing around politics. Indeed, it meant tiptoeing round everything. One early script by the poet and BBC employee Louis MacNeice even lost the sentence “Henry VIII had vulgar tastes” on the grounds that people might mishear it as “Edward VIII had vulgar tastes”. 

When in 2009 the BBC clung so much to the letter of their independence that they refused to air a humanitarian appeal for the victims of the war in Gaza, it was part of a long tradition of not quite seeing the wood for the trees.

It was no coincidence, therefore, that the BBC nailed its colours to the fence in the way that they did, and continue to. There would be flurries of exciting new projects and daring innovations and opinions. But otherwise, they would be enthusiastically, passionately, middle of the road. 

In fact, it was a key factor in their success with the public. People knew they would never be surprised, never shocked, never told anything that was too clever for them, never have an issue packaged for them with more than two sides, and they took the BBC to their hearts as a result, as their own beloved, predictable, dull-witted Auntie.

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Wednesday, 5 August 2015

Obscure? No, authenticity, Englishness, Enigma, Liberalism are all connected

Years ago, I was having lunch with my then American publisher who asked me – as American publishers tend to do – what I wanted to do with my life from then on. I said I wanted to write as many books as I possibly could.

I thought he would be pleased by this, but he wasn't. “Why quantity?” he asked. It was a good question.

I mention this because a number of people have mentioned to me over the past week (thank you, Simon!) that they were surprised at the range of subjects I was writing about.  I know they meant well, but it is rather a sensitive subject. The publishers certainly hate it. The bookshops prefer neat categorisations, and there is just a hint, the merest hint, that maybe I am dashing the things off in some way.

The thing is that, as far as I'm concerned, everything I write about is connected. It's just that, often, I'm the only one who can see how. So I thought I would maybe try people's patience with a blog post trying to explain how.

I have had two books published this month, both the result of literally YEARS of work. One is How to be English, which derives from a growing interest in culture, Englishness and class - and my own obsession with teaching my own children about their roots.

I wrote two non-fiction books which fed into this one – Broke (about the struggling middle classes) and Authenticity about the new way we were increasingly searching for a complex and, in some ways, problematic ideal.

With me so far? So how did I also end up publishing Operation Primrose, subtitled, ‘U110, the Bismarck and the Enigma Code'?

The answer is that I first became interested in Alan Turing when I was writing Authenticity, and because I was increasingly interested and critical of the Turing Test when I wrote about the future of organisations in The Human Element, with what I regarded as a healthy scepticism about IT systems in public services.

Turing himself, I think, would have understood this concern, but I'm not sure his true believers do. So I wrote a short biography of Turing which was published early last year.

Writing about Turing took me seamlessly into writing about Enigma, and I've always been passionate about naval history. But Operation Primrose in some ways brings me full circle.

Because once you put the Enigma cryptographers back into context, and realise that Turing, Knox and their colleagues were in hour by hour conflict with Wilhem Tranow and his colleagues at Bletchley's German rivals B-Dienst – and that Tranow succeeded in cracking the British wartime naval code as early as 1935 – you then start wondering about the really big question.

Which is this: why did one side win and one side, despite these huge advantages, lose?  It seems unlikely to have been greater courage, especially given the fatality rate among the U-boat crews. Why did one side’s systems of intelligence and code-breaking win out in the end? Why did democracy trump the so-called efficiency of technocracy?

And the answer it seems to me has lessons for us now – because systems which share knowledge tend to win out over systems which hoard it. Informal systems tend to win out over formal ones. Sceptical ones prepared to tolerate difficult people asking difficult questions tend to win out over systems that tend to blame every setback on traitors.

In the end, the real story of Enigma raises questions about political and organisational structures that are very relevant to today. That's why I wrote the book. See what you think.

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Tuesday, 4 August 2015

The new 'human' megatrend. Not before time.

I was looking back at the introduction I wrote to The Human Element, eventually published in 2011 but inspired by the dysfunctional approach to public services by the Blair-Brown regime (the real New Labour 'virus').

This is what I wrote about the prevailing fear of human error:

"We live in a world which believes two contradictory things at the same time: we must set people free to innovate to make things work, but we must control them tightly to make sure they don’t make a hash of it. We believe both these even though we can see the consequences all around us, and even though in practice they cancel each other out. We believe in people’s skills but we are terrified of their ability to mess up. It’s a perfectly sane position – both thoughts are true – but, in practice, this is a destructive contradiction which simply stops things working as they could. It is the reason for so much frustration....

"Nobody wants to live in a world without processes. We don’t want to make it all up again from moment to moment. But the truth is that it is this very distrust of the human factor by the technocratic systems that run our lives that is the real problem. It is true that humans make mistakes every day, especially when they are tired or unhappy. They don’t fit neatly into the required categories. But they also possess the most extraordinary abilities, and do so from birth. They learn to live, to bring up children, to lead – most of them – generally happy lives where they fall in love and make things happen, and they do so every day.

"Human beings do cause mistakes, but they also deal with human complexity better than any machine. We are in danger of forgetting one of the most important truths about the world: the human element may be a source of error, but it is also the only source of genuine change."

I apologise for such a lengthy quotation. The reason for doing so is the latest cover story of Fortune magazine, which carries the headline 'Humans are underrated'

This turns out to be based on a book with the same title by the most forward-thinking of all Fortune's writers, Geoff Colvin, with the subtitle 'What High Achievers Know That Brilliant Machines Never Will'.

It seems to me that there is something emerging here.  Colvin's book is about business, making the point that actually the skill shortage is not going to be coders - whatever it might seem now - but people with empathy, who can build relationships and make things happen.

My book was about organisations, and especially public services.  There is also Steve Hilton's new book More Human, which says similar - or at least related - things about public policy.  All of us are, in one way or another, standing on the shoulders of Bryan Appleyard.

The point is that machines are now superior to humans for most practical tasks. That is an economic problem and challenge - there will need to be some other way of providing people with the basic necessities. But it also puts the spotlight on those skills which we have downgraded - the human ones.

Colvin ends like this:

"For the past 10 generations in the developed world, and shorter but still substantial periods in many emerging economies, most people have succeeded by learning to do machine work better than machines could do it. Now that era is ending. Machines are increasingly doing such work better than we ever could. We face at least the opportunity to create new and better lives.

"Staking our futures to our profoundest human traits may feel strange and risky. Fear not. When you change perspectives and look inward rather than outward, you’ll find that what you need next has been there all along. It has been there forever. In the deepest possible sense, you’ve already got what it takes. Make of it what you will."

What I find infuriating is that, as the most successful corporations are discovering how this relates to success, our public services - still in the grip of McKinsey-inspired Taylorism - are still peddling the old suspicion. No wonder services have got so expensive.

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Monday, 3 August 2015

It is time to prevent the RBS sale. This is how.

The whisper in the Sunday papers was that George Osborne will start the process of selling off the state owned RBS some time today, with an independent investigation into how it might best be achieved and the best timetable - it is far too big to sell all at once.

Now, this is a more important issue than it might seem at first sight.  The government has an obligation either to get back the money they originally spent bailing it out - or to convert it in such a way that RBS can play a useful role.

Small business lending is still flatlining in the UK, despite the recovery - unlike the rest of Europe - because we lack banking institutions capable of providing the support to SMS, as practically every one of our European competitors do.

This is how the Economist celebrated a new bank in the USA, only the second in the past five years:

"The resultant dearth of bank startups is troubling. Although small banks accounted for just 22% of all bank lending in America in 2014, they held 51% of all small-business loans and 77% of all agricultural loans, according to a study from Harvard University. That is partly because their loan officers can use their personal knowledge of a borrower and the local economy to evaluate credit risk."

I couldn't have put it better myself, yet the UK has virtually no small banking sector to account for half of our small business loans.  The new government can't see the link between the dearth of small banks in the UK and the dearth of middle tier companies.

So if Osborne is determined to sell RBS off, just to go back to the good old pre-2008 dysfunctional gravy train, that's important.  It would mark the reversal of the coalition's attempt to rebalance the economy. It is a destructive slap in the face for beleaguered SMEs. It is an anti-business measure.

It is also a test of the question of whether the new parliament, and the new Lib Dem leadership in particular, is able to act effectively and decisively to make sure that - whatever happens to RBS - it starts to serve the SME sector.

The sell-off is only possible if investors want to buy and, I expect, the more they know, the less they will want to. So here are seven questions I would ask, and quickly:

1. Will the Chancellor publish the advice on whether RBS is viable that he has been receiving from the Treasury - and if not, why not?

2. How will losing £7bn to return RBS to its old dysfunctional state going to do anything to rebalance the economy?

3. Will Osborne wait until the elusive report on RBS' 'vulture' operation, feeding off the small businesses that came to it for help, before off-loading the company?

4. Will he consider, after the first tranche is sold, restructuring RBS along regional lines to provide some kind of diversity in the UK banking market?

5. If he doesn't come clean about the real state of RBS finances, or the future fines, then how can he honestly sell shares - except below their market value?

6. Alternatively, has the Treasury considered Nick Goodway's plan to sell it one third to investors, one third to customers and one third to staff - and if not, why not? A John Lewis approach would also bring a little diversity and real competition to the banking market.

7. Failing those solutions, how does he intend to speed up the glacial progress towards a diverse banking system that is able to support UK business?

It so happens that the official opposition's attention is elsewhere at the moment, and may be permanently, so the opposition is going to have to be led in Parliament by Tim Farron and Caroline Lucas.

In particular, it is an opportunity for the Lib Dems to make the small business agenda their own, as they should have done long ago.

My impression is that people are desperate to see politicians working together on this, and many other urgent issues where Parliament has to be forged into an effective instrument to make things happen - rather than just a backdrop to the posturing of opposition campaigns.

In the meantime, if there is anyone out there in a position to know the real financial state of RBS, I hope you will get in touch with someone in Parliament, or with one of the key journalists associated with the issue, immediately.

I hope then that we might convert RBS into an effective lending institution, supporting the UK economy, not corroding it - before it is too late.

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Thursday, 30 July 2015

The day they captured an Enigma machine

It was the morning of 9 May 1941 south of Iceland. The commander of U110, Fritz-Julius Lemp had fired four torpedoes into the convoy in quick succession.

There had been an audible explosion in the distance echoing through the icy sea, but there was also an immediate problem. The fourth torpedo had failed to leave the tube. Sea water had been pumped into the tube ready to fire, but it had failed to shoot out again with a burst of compressed air as it should have done. Consequently the submarine was now too heavy at the bows and Lemp began to lose control.

There was a short struggle to rebalance the trim and, when Lemp was finally satisfied and his crew breathed a sigh of relief, there was the warning throb of a warship coming straight towards them.

Lemp ordered U110 to dive and they could hear the terrifying and literally deafening roar of depth charges exploding all around them.

Silence at last. The crew looked for reassurance from Lemp, who was leaning theatrically against a periscope. “It’s OK,” he said. “We’re all going to be fine. You don’t think I’m going to let them catch me and shoot me, do you?”

It was a reference to the Athenia sinking eighteen months before, a Cunard liner sunk without warning on the first day of the war, and it was the kind of robust humour that was called for at this nervous moment.

Then the reports began coming into the control room. They weren’t good. The rudders were damaged. The batteries were giving off poisonous chlorine fumes, which they did in contact with water. The wheel that was used to blow the ballast tanks had come off. The depth meters had failed.

The engineer Hans-Joachim Eichelborn struggled quickly to fit new pressure gauges to the main cooling water pipes for the diesel engines, so he knew they were not actually sinking, but there was the noise of pressurised air escaping from somewhere. If they ever wanted to get to the surface, they would have to blow the tanks soon. The deciding factor was discovering that one of the propeller shafts had bent. It was clear they had no choice. They had to surface.

“We must wait and see what happens,” said Lemp quietly. “I want you all now to think of home, or something beautiful.”

It was a terrifying moment. The crew waited for the pressures on the hull to increase until it crushed them and the sea water rushed in as they sank to the depths of the Atlantic. Instead, there was a surprise. Suddenly, the boat was rocking. They must be on the surface after all. “Last stop!” shouted Lemp, like a bus conductor. “Everybody out!”

From the bridge of the destroyer Bulldog, they could see U110 on the surface dead ahead and the convoy commander Joe Baker-Cresswell ordered his engine room to increase speed to ram. As they got closer it was clear that the crew were on the deck and he put Bulldog’s engines into reverse to come alongside. Then there was a moment of indecision: were the crew actually clustering around the gun? Bulldog opened fire again with a machine gun until Baker-Cresswell confirmed that the crew were actually jumping into the water.

The scene on deck of U110 was almost as terrifying as it had been under water. Two warships were making fast towards them – the destroyers Bulldog and Broadway – and they were shooting. Shells and bullets were flying overhead. The journalist on board, Helmut Ecke, wrote later that he saw a man’s head blown to pieces next to him. He leapt into the water forgetting that his lifejacket had not yet been inflated. 

 Then came the crucial moment. The radio operator, Högel, climbed up the conning tower and asked Lemp if he should destroy the codebooks and Enigma machine. “The U-boat is sinking!” shouted Lemp. He went back inside to get the codebooks, but remembered his own notebooks and poetry for his girlfriend and got them instead.

Lemp and his first lieutenant, Dietrich Loewe, made sure than the vents had been opened and jumped into the sea themselves, the last to leave. It was only when they were halfway between U110 and Bulldog that it became clear that something was not right. The submarine was not actually sinking after all, at least not nearly so fast. Lemp shouted that they should go back, but a wave swept Loewe away and instead he made for Bulldog.

What happened to Lemp has never been clear. The British side suggests that he was never seen again. The German side suggests that he was shot before he could reboard his submarine. There are no eye-witness accounts either way. 

On board Bulldog, the same thought was also dawning on Baker-Cresswell – the U-boat next to him was not actually sinking. “By God!” he said on Bulldog’s bridge. “We'll do a Magdeburg!" Magdeburg had been a German cruiser, captured by the Russians in 1914 with codebooks intact. It was an enticing prospect.

Could they reach the submarine before it sank and take possession of the Enigma machine along with the codebooks with it? Could they change the balance of the Battle of the Atlantic? 

Find out in my new ebook Operation Primrose: U110, the Bismarck and the Enigma Code, a companion e-volume to my book about Alan Turing – attempting to set the Enigma breakthrough into some kind of context (and it only costs £1.99!)

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Wednesday, 29 July 2015

Cameron's big Lords misunderstanding

I am now 57 and feel too old to act like an Incredible Hulk, politically of course.  When that old despair and rage returns about the way my own government is behaving, my main feeling is exhaustion.  It saps the strength.

If I've occasionally seemed too much of a compromiser, here is my excuse. I feel I need to understand why decisions are taken, why officials don't understand, how we might in practice move things forward.

I'm not saying that everyone should share this, just that for me, personally, now, I'm no longer prepared just to campaign fruitlessly against things. I want to be part of making things happen.  That's why I wrote the book People Powered Prosperity: it was an honest attempt to break a logjam.

The last time I just felt furious was about the Blair-Brown approach to public services, and their determination to force me to carry an ID card. That was back in 2009.

It wasn't that I agreed with everything the coalition did - far from it (and the decision to build a new nuclear power station was pretty infuriating, but seems likely to cost so much that it won't ever happen). But I understood why the decisions had been taken in the way they had.  So for five years, I've been blissfully rage free.

So I've found the last week exhausting.  First there was the battery of wrong-headed decisions to end the progress made by the coalition on low carbon technologies - selling the Green Investment Bank, ending support for solar, closing down the low carbon homes initiative, wasting the resources of all the companies which had invested in it.

Then there was the perverse decision to overturn the ban on neonicotinoids in pesticides, which appear to be behind the death of bees. The Labour Party has less important matters on its mind, but I hope some parliamentarian will demand to see the suppressed minutes of the government's advisors - I hope a campaign group can challenge the decision in the courts. I know Parliament is in recess - that is why they made the announcement now - but this one should be winnable with sufficient opposition energy.

But I must say what really sent me into a fulminating spin of rage this afternoon was hearing David Cameron's answer about House of Lords reform, taken from his speech yesterday in Singapore. He was explaining that he intended to increase the number of Conservative peers:

“I'm not proposing to get there in one go. It is important to make sure the House of Lords more accurately reflects the situation in the House of Commons."

We know that Conservatives failed to keep their end of the coalition agreement to bring in some kind of democratic element to the Lords. In the absence of that, then the Lords certainly does need to be politically balanced.  But if the objective is to make it reflect the dysfunctional and undemocratic electoral system in the Commons, that simply compounds one injustice on another.

I accept, of course, that Lib Dems may now be quite well represented. But is Cameron intending to open the doors to Ukip or Green peers to reflect the number of people who voted for them?

The only justification for a second revising house is that it isn't a clone of the Commons. In those circumstances, what's the point?

As I raged to myself about this during the afternoon, I realised that this is not just a Conservative error, it is a utilitarian error often made by Labour too - to mistake the counting system for reality.

We have a bizarre democratic scoring system for electing governments. Perhaps it might be possible to accept the result, under certain circumstances, because it is at least a traditional method of election. But to fall into the trap of believing the perverse result of the election actually reflected the way people think is the same kind of boneheaded utilitarianism that New Labour used for its target system.

I remember hearing about a room under Labour at the Department for Education, set out like a dashboard, filled with information from targets and league tables pouring in from all over the nation - and encouraging a technocratic fantasy that the figures represented reality.

I happened to know one teaching assistant at the time in a school that was shooting up the leagues.  Her teacher had spent the whole term hiding in the stationary cupboard.

Which is a way of saying the following. We are not machines. Human objectives are complex and multi-faceted.  There are shades of black and white. The growth figures are not the economy. The target figures are not the hospitals. And the general election voting figures are not the only democratic blueprint.

When you think they are, it isn't just democracy that is undermined. The language is impoverished and we find ourselves in a narrowed universe, unable to see truths that were obvious to previous generations.

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Tuesday, 28 July 2015

The three problems with Corbynomics

My time for Labour MP Graham Stringer's conspiracy theory about the Labour leadership rather expired when he said there were Lib Dems joining his party to prevent Jeremy Corbyn becoming leader. In my experience, most Lib Dems I know find Corbyn's campaign rather a refreshing change.

I realise that contradicts the world view of many of the stodgy Labour Party types who are some miles from understanding their Liberal opponents. But so it is. Corbyn is offering an alternative, and it is about time somebody did.

But is it a forward-looking alternative or a backward-looking one? Well, spurred on by James Graham, I read his economics document and listened to his interview with Andrew Marr - and I think I agree with James.  The problem with Corbyn's economics is:

"His solution to everything is state centralisation."

It is fascinating and exciting that someone has managed to break the Labour blancmange but there are difficulties with an economic policy that claims to be about 'rebalancing' but is actually deeply conservative. So here are my three problems with Corbynomics:

1. Where are the mutuals? There is very little about transformative new structures of enterprise like mutuals, especially those which can be genuinely innovative running public services.

2. Where is the local lending?  The idea of a national infrastructure bank, spending money created by the Bank of England, is a sound one - but it doesn't solve the problem about how that money filters down to the entrepreneurs at local level because that requires access to local risk information. It makes precisely the same mistake as the coalition, assuming that - if they provided money to the big banks and told them to lend it to SMEs - they would be able to do so. In fact, as it proved, the banks had long since abandoned their own local structures and were consequently unable to lend the money effectively.

3.  Who is the community? Corbyn claimed in one sentence that "the state, the government, the community" were all one and the same. This is precisely the mistake that state socialists have made throughout - they can't see the distinction between the Man in Whitehall, the ministers who instruct them, and you and me. Here is the basis of a new kind of tyranny: The People have spoken, and we must do their bidding.

A nervous shiver ran down my spine when I heard that he wanted to re-nationalise energy production.  Because, of all the institutions that have disappeared over recent decades, I go down my my knees to thank providence that we don't any more have to contend with the old Central Electricity Generating Board (CEGB).

I remember the futurist Francis Kinsman describing an encounter with one of their managers after a talk he gave on the rise of the ‘inner-directed’ approach to life – those people who put independence, health and self-improvement above keeping up with the Joneses.

While much of the discussion had been about the benefits to business of independence of mind, the CEGB manager took him aside afterwards to ask how they could recognise inner-directed people on the payroll.

It transpired that his interest was not to promote them, or get ideas from them, but so that they could weed them out.

Let’s face it, only centralised bureaucracies on a truly Soviet scale – buttressed by centralised assumptions – could have succeeded in producing the staggering waste, delay, expense and secrecy of the British nuclear industry over the past half century.

This is not to suggest that the current oligopoly is much of an improvement, but don't let's leap out of the frying pan and into the fire.

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