Coming back soon

29 Sep 2021

I have stopped updating this site for a while now but I hope to be back with an updated version before too long. What this space. In the meantime you can follow me on twitter 

I appear in a new Worldwrite video report on the Price of London Life.

Debate in Durham

5 Feb 2019

I will be debating the efficacy of trade versus aid in development at the Durham Union Society this coming Friday.

My debate from the Battle of Ideas 2018 on “Trust: 10 years after the financial crisis” is now available to watch online.

I am delighted to be speaking at two sessions at this year’s Battle of Ideas festival in London on the weekend of 13-14 October. At 10am on Sunday 14th I will be talking about big business in the developing world. Then at 12 noon there will be session on 10 years after the financial crisis.  However, I recommend attending the whole weekend.

This is the full text of my review essay published on spiked on 13 September. 

The bankruptcy a decade ago of Lehman Brothers, a Wall Street investment bank, is widely seen as turning point in early 21st-century history. Many view it as a trigger for the global financial crisis, which in turn precipitated the worst economic downturn since the 1930s. The subsequent imposition of austerity is widely seen as a key factor in the rise of populism across the Western world.

Given that Crashed has quickly come to be regarded as the definitive work on the crisis and its aftermath, it is an important book to examine. Adam Tooze, a professor of history at Columbia University in New York, has certainly assembled a huge amount of empirical material. The main text is over 600 pages long and there are another 70 pages of footnotes in both English and German. But, despite some insights, what the book inadvertently reveals is the inability of even the sharpest of mainstream thinkers to get to the root of recent developments.

Tooze argues that the financial crisis is both a global and an ongoing affair. The September 2008 collapse of Lehman Brothers on Wall Street may have become a key reference point, but the crisis quickly engulfed other parts of the world. Tooze maintains, convincingly, that an over-extended European banking system was particularly vulnerable to collapse. After 2012, this crisis ‘morphed’ (his word) ‘into a comprehensive political and geopolitical crisis of the post-Cold War era’. This leads him to examine a wide range of ‘aftershocks’, including: widening inequality in the US; turmoil in the Ukraine; events in Greece; the election of Donald Trump as US president; and Brexit.

The problem is that the enormous breath of Tooze’s analysis becomes a substitute for examining any question in sufficient depth. He fails to adequately explain either the roots of the financial crisis or the dynamic behind the diverse political trends he discusses.

At a minimum, a truly definitive work on the crisis would be expected to explain why it came about. Instead there are several assertions, but no systematic explanations. For example, like many others before him, Tooze suggests that financial deregulation was an important factor, but this is never examined in detail. The claim here is that lax regulation made it possible for financial institutions to act in irresponsible ways. He also asserts that ‘ground zero was America’s housing market, for sure’. In other words, the flawed financial instruments linked to the US mortgage market played a key role in bringing down Lehman and other financial institutions.

Yet only nine months after Lehman’s collapse, the Bank for International Settlements, the central bankers’ central bank, had already gone further than Crashed does in identifying different possible explanations. These included, among others, the claim that a protracted period of low interest rates had created the basis for asset-price bubbles to emerge in areas such as property. Another argument was that a build-up of international imbalances, such as the huge US trade deficit and the Chinese surplus, played an important role in destabilising markets.

Tooze should, of course, be free to reject such explanations in favour of those he prefers. But nowhere in Crashed is there a methodical examination of the causes of the crisis. There is certainly nothing comparable to the argument put forward by Phil Mullan previously on spiked. For Mullan, the Lehman crisis was a manifestation of problems that had been brewing in Western economies for several decades. Writing on the 10th anniversary of the financial problems that preceded Lehman, he argued that, ‘dramatic as the events of summer 2007 were, their real significance was not that they were the start of a financial crisis, but rather that they looked like the end of the protracted second act of the Long Depression’.

For Mullan, the Long Depression dated back to the slowdown in investment and productivity growth in the 1970s. Although this initially caused a shock in the mid-1970s and early 1980s, by the end of the 1980s Western capitalism had entered a more tranquil and slow-moving phase. Western elites benefited from the defeat of working-class politics at home and the relative stability brought about by the end of the Cold War. This created the basis for a more financialised world economy with greater capital flows between nations and a rapid expansion of debt. This financialised environment provided the backdrop to Lehman’s collapse. But Lehman was an outcome of earlier economic trends, rather than a force for instability in itself.

Few mainstream thinkers even explore such possibilities as they tend to fetishise finance. That is, they see the financial markets and financial institutions as forces in their own terms rather than examining whether there are any more fundamental economic forces at work. The simple fact that a severe recession followed Lehman’s collapse is often taken as sufficient evidence that the financial crisis was the cause of the downturn. But that is a common logical fallacy. Just because one event follows another, it does not mean that the previous event is necessarily the cause.

In the case of Lehman, it is too often forgotten that its collapse happened in an environment of chronic economic weakness. Focusing too much on finance is like explaining a forest fire by saying someone lit a match to set it alight. That may be true, but if the forest was already bone dry, that in turn has to be explained. No amount of examination of the match in question will tell anything like the full story.

If Crashed fails as an explanation of the financial crisis, it is also lacking in its examination of subsequent events. Part of the problem lies with Tooze’s conception of the financial crisis ‘morphing’ into a geopolitical one. If he was merely claiming that the financial crisis, in some respects, influenced subsequent events, that would be fair enough. But if he is arguing that it is the predominant influence on subsequent events, then that is a different matter. In the event, it is not clear what he is saying.

Perhaps the US presidential elections of 2016 provide the clearest example of the financial crisis influencing the vocabulary of the election. As Tooze argues, one of the leading Democratic Party candidates, Bernie Sanders, did focus his campaign on attacking Wall Street. Trump, too, often attacked financiers as part of his campaign. Meanwhile, Hillary Clinton, the eventual Democratic party nominee for the presidency, no doubt lost support as a result of being too close to Wall Street. Among other things, she famously earned hefty speakers’ fees for giving talks to prestigious financial institutions.

But even in the American case, it is far from clear that the aftershock of the Lehman collapse was the predominant factor. Some commentators, such as Arlie Hochschild, a sociologist at the University of California, Berkeley, have pointed to the huge cultural gap that has opened up between the American elite and a large section of the population. Many Americans felt estranged from the espousal of identity politics and PC culture that had become prevalent in elite circles. And a large number of Americans felt estranged from politics despite living in what claims to be a democracy.

Admittedly, this cultural divide comes on top of a prolonged period of stagnant wages for a substantial section of the American population. But the protracted period of static real wages goes back several decades. In other words, it long pre-dated the financial crisis only a decade ago. The Lehman collapse of 2008 clearly could not be responsible for stagnant wages in the 1970s, 1980s and 1990s.

In any case, Tooze feels no obligation to explore either the protracted period of static wages or the importance of cultural factors in Trump’s election victory. On the contrary, the narrow prism of finance precludes Tooze from doing either. Instead, he follows the common path of many self-defined ‘liberals’, with side-swipes condemning ordinary Americans as stupid and xenophobic. He fails to see that many Americans had good reason to resent an aloof and arrogant establishment, which had no qualms about condemning them as ‘a basket of deplorables’.

In the case of Britain, the connection between the financial crisis and the Brexit referendum result is even less convincing. Tooze makes a just about plausible case that one reason David Cameron decided to announce the referendum in January 2013 was to help protect the status of the City of London. The then prime minister assumed that a ‘yes’ vote would strengthen his hand in negotiations with other members of the European Union. Whether or not this is true, it is hard to see it as anything more than a footnote in the voluminous discussion around Brexit.

In Britain, as in the US, there was a sharp divide between a ruling technocratic elite and a large swathe of the population. Many in Britain felt, rightly, that they were marginalised from politics. Key decisions about how the country is run, including control over its borders, had been taken out of the realm of democratic debate. Only in Britain, the choice was not between an establishment presidential candidate and an irascible political maverick, but over leaving the EU or remaining within it.

However, there is one way in which Tooze, almost despite himself, does help explain why many people on both sides of the Atlantic felt estranged from decision-making. He does show several instances where both central banks and the EU act in blatant disregard of democracy. For example, he talks of a ‘spiral of silence’, in which central banks played down the huge scale of their international financial collaboration. This was an important economic development on which there has been no democratic debate.

To his credit, although he is a self-professed supporter of the EU, he also points to flagrant disregard for democracy within it. For instance, he points to how, at the G20 Cannes summit in November 2013, the leaders of France and Germany colluded to remove the democratically elected leaders of Greece and Italy. In both cases they were replaced by unelected technocrats. If Tooze had probed the significance of such developments further, he probably would have developed a better understanding of the role of populism.

Crashed fails as it provides neither a convincing explanation of the roots of the financial crisis, nor a balanced account of subsequent political developments. The definitive works on all of these topics remain to be written. But trying to explain complex political shifts through the narrow prism of finance was always bound to fail.

Spiked has published my review of Adam Tooze’s Crashed, already widely hailed as the definitive work on the global financial crisis. I will upload the full text at a later date.



This is the full text of my article for the August 2018 edition of the Spiked review.

Attitudes towards the internet have shifted incredibly over the past few years. Where many used to praise the supposedly liberatory power of digital technology, now they talk gloomily about its allegedly malign influence. The main focus is on social-media platforms, Facebook most of all, but this new fear encompasses many other internet companies, too.

Given how much perceptions have changed over the years, a reminder of how things used to be not that long ago provides a salutary lesson. The election of Barack Obama as America’s first black president was a high point in positivity. Use of social media was widely praised, especially among self-defined liberals, for helping Obama to overcome decades of racism and win the election. For example, Arianna Huffington, editor-in-chief of the Huffington Postsaid: ‘Were it not for the internet, Barack Obama would not be president.’ She went on: ‘Were it not for the internet, he wouldn’t even have been the democratic nominee.’

The Arab Spring of 2011 bought the hype about new technology to even further heights of ecstasy. Many self-proclaimed progressives credited social media as the driving force behind the popular uprisings against the autocratic rulers of several Arab countries. Paul Mason, a prominent left-wing commentator, described the protests in Egypt that year as ‘a revolution planned on Facebook, organised on Twitter and broadcast to the world via YouTube’.

This is not the place to examine the two sets of events except to say that the claims they were victories driven by social media have not stood the test of time. It is true that the Obama 2008 campaign, with its promise of radical change, inspired a large section of the American electorate. But although social media may have helped to spread the message, they did not create the conditions of public disenchantment with traditional political leaders. Likewise, social media may have helped activists promote protests in Egypt, Tunisia and elsewhere, but the key component of the Arab Spring – corroded systems of government overseen by geriatric rulers – had little to do with Facebook or Twitter.

In any case, the subsequent setbacks in both the US and the Middle East call into question the breathless claims about social media creating a new progressive epoch.

Fast forward to the present, though, and elite attitudes towards social media have taken on a much darker hue. It is hard to follow the news without being bombarded with hysterical claims about the supposed dangers of the internet and associated technology. The litany of charges includes: undermining democracy; spreading ‘fake news’; eroding privacy; facilitating tax dodging; fostering new forms of addiction; letting sexual harassment run riot; failing to tackle inequality; and endangering children. Anyone who thinks this list is exaggerated can use Google to verify it.

This is not to say there were no criticisms of digital technology a decade ago or that there are no positive voices today. But the balance of opinion has shifted in a short time from a generally rosy outlook to a frequently doom-laden one.

Jamie Bartlett, director of the Centre for the Analysis of Social Media at the think-tank Demos, has probably done more than anyone else in Britain to draw attention to this shift. His two-part BBC2 documentary on the Secrets of Silicon Valley, first broadcast in 2017, contended that a backlash against digital technology had begun. The People Vs Tech is essentially an elaboration of the arguments in part two of Secrets of Silicon Valley.

Bartlett tries hard to maintain an even-handed approach to the new technology, although he ultimately comes down on the side of the pessimists. For him the ‘techlash’, as he calls it, ‘is a welcome brake on the runaway tech train’. However, he does go on to warn there is a danger that ‘it’s turning into a blind emotional rage against the machines’. Tellingly, he writes that his own approach to social media has become negative in his decade following the subject: ‘My optimism drifted into realism, then morphed into nervousness. Now it is approaching mild panic.’

Much more of a problem, though, is his failure properly to explore the reasons behind the shift. The furthest Bartlett goes is to argue that it is motivated by the revenge of the Old Media on the New Media. In other words, newspapers, their advertising revenue savaged by the internet platforms, have facilitated criticism of the new technology.

But given the huge scale of the onslaught against digital technology this is not entirely convincing. Governments across the Western world, along with supranational institutions, such as the European Union, have led an onslaught against the new tech giants on many fronts. The range of new laws and regulations that have either been implemented or will soon be implemented is astounding. There are also several examples of massive fines imposed on tech companies. These include the European Commission’s €4.34 billion (£3.85 billion) fine on Google for allegedly engaging in anti-competitive practices with its android software. In the name of protecting public safety and countering fake news, there is a concerted drive to counter the expression of non-mainstream opinions on the internet.

Before outlining some of these measures, it is necessary to identify the forces behind the dramatic shift. The most obvious is the rise of populism. It is personified in the shift between two famous social-media users: Barack Obama and Donald Trump. Trump has become notorious for his angry and often ill-judged tweets. Whereas social media as a whole was once seen as a vehicle for progressive cool, it is now associated with angry populism. Ironically, it is often those most guilty of hype in relation to the Obama campaign who have become digital technology’s most trenchant critics.

But although this abrupt reversal in perceptions is symbolised by these two presidents, it goes much further. It represents a fear on the part of large sections of the ruling elite that their hold over public opinion is disappearing. This is represented by the Brexit referendum in Britain, Trump’s victory in the US and the growing support for many populist parties in continental Europe.

From an elite perspective, a key danger of social media is that it allows political trends outside of the mainstream to spread their arguments more easily. Yascha Mounk, a politics lecturer at Harvard and executive director at the Tony Blair Institute for Global Change, has expressed this fear in relation to the decline of traditional media ‘gatekeepers’ in the US.

Mounk’s reasoning is worth quoting at length because it makes clear both the issues at stake and the anti-democratic nature of the argument. He describes the traditional elite conception of democracy as telling the people that ‘as long as you let us call the shots, we will pretend to let you rule’. He then goes on to argue: ‘It’s a deal that has proven phenomenally successful for 250 years. Today, that deal is becoming increasingly difficult to sustain, and the reason is both unlikely and counterintuitive: the rise of the internet and social media is making the ideological foundation of liberal democracy – which has had a tight hold over our imagination for the better part of two centuries – look increasingly brittle.’

Bartlett’s argument is not explicitly anti-democratic but his assessment is similar to Mounk’s. The new technology gives voices which might once have been marginal the capacity to influence political debate.

This, then, is the trend across the Western world. The rise of social media is viewed with horror by political elites now that they realise it could help forces from outside the traditional mainstream. Our embattled rulers like to flatter themselves by presenting the political divide as a clash of cosmopolitan liberals against the bigoted public. But their real fear is that the new media threatens their hold over political debate.

Before concluding with the dangerous consequences of the turn against social media, it is important to recognise that there are more long-standing elite fears about technology. For example, technological development is generally associated with economic progress; a development which mainstream thinking has come to fear. This is a topic I have written about at length in my book Ferraris for All. But it is the rise of populism that explains the spectacularly rapid recent shift in elite attitudes towards social media in particular.

Given the elite’s fear and loathing of the public, it should not be a surprise that the measures it is implementing will act to curb free expression. There are so many of them, coming from so many different angles and covering so many different countries, that it is hard to keep up. They include regulations relating to fake news, hate speech, copyright, data protection, child protection and alleged monopoly practices. But the overall effect is to tighten state control over the new media at the expense of free expression and democracy.

It should be no surprise that some of these regulations exist at a European Union (EU) level. For example, the General Data Protection Regulation (GDPR) gives regulators far more power over the flow of data than they previously had. One side effect is that many leading American outlets, unwilling to comply with the onerous legislation, have blocked access to those who live inside the EU.

Meanwhile, in Germany, a new law is not only undermining free speech at home but has set a dangerous precedent that is in the process of being taken up elsewhere. As Bartlett pointed out in his BBC documentary, the 2017 Network Enforcement Act (Netzwerkdurchsetzungsgesetz or NetzDG) breaks the key legal principle that social-media platforms are not responsible for uploaded content. The new law means that social-media sites became liable under Germany’s pre-existing hate-speech laws.

Under NetzDG, a social-media platform can be fined up to €50million (£44million) if it does not remove blatantly illegal material within 24 hours. Hate speech or fake news that is not unequivocally illegal must be removed within seven days, or a lesser fine could be imposed. This measure will inevitably have a chilling effect on free speech. Facebook and Twitter have reportedly recruited many hundreds of German-language moderators to sift through the huge volume of material posted on their sites. No doubt there will be strong desire to play it safe and delete any material that could be considered troublesome.

In Britain, a trenchant parliamentary report on social media, published by the Department for Digital, Culture, Media & Sport (DCMS) select committee, recently gained widespread publicity. Among its recommendations was, in line with the precedent set by the NetzDG, giving technology firms clear legal liability for ‘harmful and illegal content’. This pushes censorship even further by proposing that social-media platforms should be responsible for material deemed harmful even if it is perfectly legal.

As it happens, the DCMS was pushing at an open door. The government is already in the process of extensively reviewing laws regarding the internet. It has completed a consultation over an Internet Safety Strategy, which entails extensive new controls over the internet. A White Paper, proposing future legislation, is expected before the end of the year. And all this is on top of the Digital Charter on internet safety published in January and the Data Protection Act 2018, which incorporates the EU’s GDPR into British law. The overall effect is that use of the internet will be far more regulated than it was in the past.

If this international legislative onslaught is designed to keep anyone safe, it is not the vulnerable but the political elites themselves. Public criticisms of those in power will find it harder to gain an airing. It represents a comprehensive assault on freedom of speech. Resisting this offensive is essential for all those who believe in democracy.

The spiked review has published an article by me on how the fear of ‘populism’ has led to an elite turn against social media. I will upload the full text at a later date but for now it is available by simple following the link.

My introduction to last week’s Academy of Ideas Economy Forum discussion on the backlash against Silicon Valley is now available to listen to on the event’s webpage.