Slavoj Žižek on the Riots (and everything else!)

Repetition, according to Hegel, plays a crucial role in history: when something happens just once, it may be dismissed as an accident, something that might have been avoided if the situation had been handled differently; but when the same event repeats itself, it is a sign that a deeper historical process is unfolding. When Napoleon lost at Leipzig in 1813, it looked like bad luck; when he lost again at Waterloo, it was clear that his time was over. The same holds for the continuing financial crisis. In September 2008, it was presented by some as an anomaly that could be corrected through better regulations etc; now that signs of a repeated financial meltdown are gathering it is clear that we are dealing with a structural phenomenon.

We are told again and again that we are living through a debt crisis, and that we all have to share the burden and tighten our belts. All, that is, except the (very) rich. The idea of taxing them more is taboo: if we did, the argument runs, the rich would have no incentive to invest, fewer jobs would be created and we would all suffer. The only way to save ourselves from hard times is for the poor to get poorer and the rich to get richer. What should the poor do? What can they do?

Although the riots in the UK were triggered by the suspicious shooting of Mark Duggan, everyone agrees that they express a deeper unease – but of what kind? As with the car burnings in the Paris banlieues in 2005, the UK rioters had no message to deliver. (There is a clear contrast with the massive student demonstrations in November 2010, which also turned to violence. The students were making clear that they rejected the proposed reforms to higher education.) This is why it is difficult to conceive of the UK rioters in Marxist terms, as an instance of the emergence of the revolutionary subject; they fit much better the Hegelian notion of the ‘rabble’, those outside organised social space, who can express their discontent only through ‘irrational’ outbursts of destructive violence – what Hegel called ‘abstract negativity’.

There is an old story about a worker suspected of stealing: every evening, as he leaves the factory, the wheelbarrow he pushes in front of him is carefully inspected. The guards find nothing; it is always empty. Finally, the penny drops: what the worker is stealing are the wheelbarrows themselves. The guards were missing the obvious truth, just as the commentators on the riots have done. We are told that the disintegration of the Communist regimes in the early 1990s signalled the end of ideology: the time of large-scale ideological projects culminating in totalitarian catastrophe was over; we had entered a new era of rational, pragmatic politics. If the commonplace that we live in a post-ideological era is true in any sense, it can be seen in this recent outburst of violence. This was zero-degree protest, a violent action demanding nothing. In their desperate attempt to find meaning in the riots, the sociologists and editorial-writers obfuscated the enigma the riots presented.

The protesters, though underprivileged and de facto socially excluded, weren’t living on the edge of starvation. People in much worse material straits, let alone conditions of physical and ideological oppression, have been able to organise themselves into political forces with clear agendas. The fact that the rioters have no programme is therefore itself a fact to be interpreted: it tells us a great deal about our ideological-political predicament and about the kind of society we inhabit, a society which celebrates choice but in which the only available alternative to enforced democratic consensus is a blind acting out. Opposition to the system can no longer articulate itself in the form of a realistic alternative, or even as a utopian project, but can only take the shape of a meaningless outburst. What is the point of our celebrated freedom of choice when the only choice is between playing by the rules and (self-)destructive violence?

Alain Badiou has argued that we live in a social space which is increasingly experienced as ‘worldless’: in such a space, the only form protest can take is meaningless violence. Perhaps this is one of the main dangers of capitalism: although by virtue of being global it encompasses the whole world, it sustains a ‘worldless’ ideological constellation in which people are deprived of their ways of locating meaning. The fundamental lesson of globalisation is that capitalism can accommodate itself to all civilisations, from Christian to Hindu or Buddhist, from West to East: there is no global ‘capitalist worldview’, no ‘capitalist civilisation’ proper. The global dimension of capitalism represents truth without meaning.

The first conclusion to be drawn from the riots, therefore, is that both conservative and liberal reactions to the unrest are inadequate. The conservative reaction was predictable: there is no justification for such vandalism; one should use all necessary means to restore order; to prevent further explosions of this kind we need not more tolerance and social help but more discipline, hard work and a sense of responsibility. What’s wrong with this account is not only that it ignores the desperate social situation pushing young people towards violent outbursts but, perhaps more important, that it ignores the way these outbursts echo the hidden premises of conservative ideology itself. When, in the 1990s, the Conservatives launched their ‘back to basics’ campaign, its obscene complement was revealed by Norman Tebbit: ‘Man is not just a social but also a territorial animal; it must be part of our agenda to satisfy those basic instincts of tribalism and territoriality.’ This is what ‘back to basics’ was really about: the unleashing of the barbarian who lurked beneath our apparently civilised, bourgeois society, through the satisfying of the barbarian’s ‘basic instincts’. In the 1960s, Herbert Marcuse introduced the concept of ‘repressive desublimation’ to explain the ‘sexual revolution’: human drives could be desublimated, allowed free rein, and still be subject to capitalist control – viz, the porn industry. On British streets during the unrest, what we saw was not men reduced to ‘beasts’, but the stripped-down form of the ‘beast’ produced by capitalist ideology.

Meanwhile leftist liberals, no less predictably, stuck to their mantra about social programmes and integration initiatives, the neglect of which has deprived second and third-generation immigrants of their economic and social prospects: violent outbursts are the only means they have to articulate their dissatisfaction. Instead of indulging ourselves in revenge fantasies, we should make the effort to understand the deeper causes of the outbursts. Can we even imagine what it means to be a young man in a poor, racially mixed area, a priori suspected and harassed by the police, not only unemployed but often unemployable, with no hope of a future? The implication is that the conditions these people find themselves in make it inevitable that they will take to the streets. The problem with this account, though, is that it lists only the objective conditions for the riots. To riot is to make a subjective statement, implicitly to declare how one relates to one’s objective conditions.

We live in cynical times, and it’s easy to imagine a protester who, caught looting and burning a store and pressed for his reasons, would answer in the language used by social workers and sociologists, citing diminished social mobility, rising insecurity, the disintegration of paternal authority, the lack of maternal love in his early childhood. He knows what he is doing, then, but is doing it nonetheless.

It is meaningless to ponder which of these two reactions, conservative or liberal, is the worse: as Stalin would have put it, they are both worse, and that includes the warning given by both sides that the real danger of these outbursts resides in the predictable racist reaction of the ‘silent majority’. One of the forms this reaction took was the ‘tribal’ activity of the local (Turkish, Caribbean, Sikh) communities which quickly organised their own vigilante units to protect their property. Are the shopkeepers a small bourgeoisie defending their property against a genuine, if violent, protest against the system; or are they representatives of the working class, fighting the forces of social disintegration? Here too one should reject the demand to take sides. The truth is that the conflict was between two poles of the underprivileged: those who have succeeded in functioning within the system versus those who are too frustrated to go on trying. The rioters’ violence was almost exclusively directed against their own. The cars burned and the shops looted were not in rich neighbourhoods, but in the rioters’ own. The conflict is not between different parts of society; it is, at its most radical, the conflict between society and society, between those with everything, and those with nothing, to lose; between those with no stake in their community and those whose stakes are the highest.

Zygmunt Bauman characterised the riots as acts of ‘defective and disqualified consumers’: more than anything else, they were a manifestation of a consumerist desire violently enacted when unable to realise itself in the ‘proper’ way – by shopping. As such, they also contain a moment of genuine protest, in the form of an ironic response to consumerist ideology: ‘You call on us to consume while simultaneously depriving us of the means to do it properly – so here we are doing it the only way we can!’ The riots are a demonstration of the material force of ideology – so much, perhaps, for the ‘post-ideological society’. From a revolutionary point of view, the problem with the riots is not the violence as such, but the fact that the violence is not truly self-assertive. It is impotent rage and despair masked as a display of force; it is envy masked as triumphant carnival.

The riots should be situated in relation to another type of violence that the liberal majority today perceives as a threat to our way of life: terrorist attacks and suicide bombings. In both instances, violence and counter-violence are caught up in a vicious circle, each generating the forces it tries to combat. In both cases, we are dealing with blind passages à l’acte, in which violence is an implicit admission of impotence. The difference is that, in contrast to the riots in the UK or in Paris, terrorist attacks are carried out in service of the absolute Meaning provided by religion.

But weren’t the Arab uprisings a collective act of resistance that avoided the false alternative of self-destructive violence and religious fundamentalism? Unfortunately, the Egyptian summer of 2011 will be remembered as marking the end of revolution, a time when its emancipatory potential was suffocated. Its gravediggers are the army and the Islamists. The contours of the pact between the army (which is Mubarak’s army) and the Islamists (who were marginalised in the early months of the upheaval but are now gaining ground) are increasingly clear: the Islamists will tolerate the army’s material privileges and in exchange will secure ideological hegemony. The losers will be the pro-Western liberals, too weak – in spite of the CIA funding they are getting – to ‘promote democracy’, as well as the true agents of the spring events, the emerging secular left that has been trying to set up a network of civil society organisations, from trade unions to feminists. The rapidly worsening economic situation will sooner or later bring the poor, who were largely absent from the spring protests, onto the streets. There is likely to be a new explosion, and the difficult question for Egypt’s political subjects is who will succeed in directing the rage of the poor? Who will translate it into a political programme: the new secular left or the Islamists?

The predominant reaction of Western public opinion to the pact between Islamists and the army will no doubt be a triumphant display of cynical wisdom: we will be told that, as the case of (non-Arab) Iran made clear, popular upheavals in Arab countries always end in militant Islamism. Mubarak will appear as having been a much lesser evil – better to stick with the devil you know than to play around with emancipation. Against such cynicism, one should remain unconditionally faithful to the radical-emancipatory core of the Egypt uprising.

But one should also avoid the temptation of the narcissism of the lost cause: it’s too easy to admire the sublime beauty of uprisings doomed to fail. Today’s left faces the problem of ‘determinate negation’: what new order should replace the old one after the uprising, when the sublime enthusiasm of the first moment is over? In this context, the manifesto of the Spanish indignados, issued after their demonstrations in May, is revealing. The first thing that meets the eye is the pointedly apolitical tone: ‘Some of us consider ourselves progressive, others conservative. Some of us are believers, some not. Some of us have clearly defined ideologies, others are apolitical, but we are all concerned and angry about the political, economic and social outlook that we see around us: corruption among politicians, businessmen, bankers, leaving us helpless, without a voice.’ They make their protest on behalf of the ‘inalienable truths that we should abide by in our society: the right to housing, employment, culture, health, education, political participation, free personal development and consumer rights for a healthy and happy life.’ Rejecting violence, they call for an ‘ethical revolution. Instead of placing money above human beings, we shall put it back to our service. We are people, not products. I am not a product of what I buy, why I buy and who I buy from.’ Who will be the agents of this revolution? The indignados dismiss the entire political class, right and left, as corrupt and controlled by a lust for power, yet the manifesto nevertheless consists of a series of demands addressed at – whom? Not the people themselves: the indignados do not (yet) claim that no one else will do it for them, that they themselves have to be the change they want to see. And this is the fatal weakness of recent protests: they express an authentic rage which is not able to transform itself into a positive programme of sociopolitical change. They express a spirit of revolt without revolution.

The situation in Greece looks more promising, probably owing to the recent tradition of progressive self-organisation (which disappeared in Spain after the fall of the Franco regime). But even in Greece, the protest movement displays the limits of self-organisation: protesters sustain a space of egalitarian freedom with no central authority to regulate it, a public space where all are allotted the same amount of time to speak and so on. When the protesters started to debate what to do next, how to move beyond mere protest, the majority consensus was that what was needed was not a new party or a direct attempt to take state power, but a movement whose aim is to exert pressure on political parties. This is clearly not enough to impose a reorganisation of social life. To do that, one needs a strong body able to reach quick decisions and to implement them with all necessary harshness.

Norman Macrae (RIP)

WHEN Norman Macrae died on June 11th, aged 89, no major British newspaper published an obituary of him. You could blame The Economist’s tradition of anonymity; you could blame the extraordinary modesty of the man himself who, if you tried to take his photo, would duck down and giggle, convinced that no one could possibly be interested in him.

Yet Norman was one of the intellectual giants of post-war Britain: one of the very few journalists who could bear comparison with the best brains of his time. Like Milton Friedman, he applied free-market principles to public services such as education and council housing. Like Daniel Bell, he charted the shift from the industrial to the post-industrial society. And like Peter Drucker he illuminated the internal workings of companies, the organisations that drove the West’s prosperity and guaranteed its freedoms.

He kept the flame of free-market thinking burning during the long night of collectivism. He predicted the collapse of the Soviet Union, at a time when the CIA was obsessed by Russia’s growing strength, and foresaw the privatisation of industry, when other intellectuals were celebrating the triumph of the “mixed economy”.

Norman was the first journalist to “discover” Japan. In 1962 he wrote a survey predicting that a country most Westerners regarded as synonymous with knick-knacks and knock-offs would become an industrial power-house. He was also the first journalist to “discover” the internet. In 1984 he wrote another survey arguing that life was about to be transformed by “terminals” which would give users access to giant databases. He predicted that the 1973 energy shock would eventually lead to a surge in the supply of energy. He also dismissed the Club of Rome’s prediction that the world was about to run out of food as arrant nonsense.

The Economist was fortunate that Norman decided to park his formidable intellect at 25 St James’s Street. During his almost 40 years here—23 of them, from 1965 to 1988, as deputy editor—he did more than anyone else to provide the intellectual originality of what he liked to describe as “the world’s favourite viewspaper”. He constantly enlivened editorial meetings with proposals to allow Disneyworld to run the West’s cities or to move the British government from London to York. Roy Jenkins rightly described him as the “epitome of the internal spirit of The Economist”.

He could be a brutal editor and a savage critic of flabby ideas. He altered colleagues’ copy with abandon. But he was greatly liked, generous with his time and amiable in conversation. He was also a loyal company man, never allowing his growing renown to go to his head. He frequently slept in his office, his large frame heaped on the floor, and sweated blood to correct errant facts as well as to expunge creeping heresy. More than anyone else, he made sure that The Economist was not blown off course by the winds of ideological fashion or becalmed in routine reporting.

But if The Economist was lucky to find Norman, he was lucky to find The Economist. His website poses a question at the end of each of his essays: “Brilliant? Batty?” and invites readers to join the fray. His undoubted eccentricity was partly a matter of personal style. The words tumbled out in an incoherent jumble interrupted by heaving shoulders and gales of cackling laughter. His handwriting was such a scrawl that only one person in the world, his loyal secretary, Elizabeth Methold, could decipher it—and she could perform this miracle only by holding the script at arm’s length, half-shutting her eyes and (in her words) going into a trance.

The eccentricity extended to his writing. Norman was a punctilious student of statistics. But he was quite happy to illustrate a 1969 article on American productivity with the assertion that a time-and-motion study of housewives at the kitchen sink would “almost certainly find” that the average American housewife was twice as efficient as the average British one. Why? Because the American housewife was capable of instinctively working out in her head, for each chore, “some rough approximation of what modern businessmen call a critical path analysis”.

The Economist provided him with the ideal mixture of freedom and discipline. He could travel to any corner of the world he fancied to produce lengthy reports on anything he wished, from the state of America to the future of mankind. Many of these special reports became books. But he was reined in when he got a bit too wild—as when he advocated writing a cover leader championing a nasal spray to “cure” homosexuals (who, he thought, were driven that way by their aversion to the smell of their mothers). He was passed over three times for the editorship. But, in truth, he was in exactly the right position.

The crystal ball

His greatest gift was his uncanny ability to predict the future. But the problem with the future is that it eventually arrives. Visions that are called from the vasty deep become reality. Ideas that were once pooh-poohed as outlandish become commonplace. “Nobody listened, then everybody did,” Norman wrote ruefully in a 1991 article called “A future history of privatisation, 1992-2022”. To grasp his prescience, it is necessary to return to an era when today’s commonplaces were heresies.

Not so murky to him

During much of the post-war period the market was “out” and the benevolent state was “in”. Public intellectuals such as Kenneth Galbraith argued that the age of the entrepreneur had given way to the age of the giant corporation. Practical politicians poured money into British Steel and the Concorde project. The market meant chaos and unemployment; industrial policy meant smooth growth and jobs for all.

Norman saw this as a recipe for flabby politics and failed economics. In 1954 he coined the term “Butskellism” to describe the portmanteau politics of the Conservative chancellor of the exchequer, R.A. Butler, and a Labour predecessor, Hugh Gaitskell. Throughout the Butskellite era he relentlessly documented the failures of industrial policy and government planning.

This makes it sound as if Norman was nothing more than a prophet of the new right. But the truth is more complicated—and, as befits the man, more idiosyncratic. Even while he embraced the market on micro-economic policy, he remained more or less a Keynesian on macroeconomic policy until the late 1970s. He was a firm believer in pumping up demand with deficit spending and holding down inflation with incomes policy. No deficit was too big and no incomes policy too hopeless. He greeted the first macroeconomic flushes of Reaganism and Thatcherism with sceptical editorials before finally admitting that he had been wrong. It was perhaps the only time he was not ahead of the debate.

Norman also had no time for social conservatism. He worried about broken families and out-of-wedlock births, but entirely from a utilitarian rather than a moral point of view. He dismissed the religious right as vigorously as he dismissed feminists and environmentalists (“both simple and psychotic Americans have too often been dominated by religious liars”). He argued that one of man’s greatest problems in the coming years would be growing life-expectancy—and advocated a “system of planned death” to deal with it. In a survey of America in 1975 he predicted that euthanasia would soon be as acceptable as abortion: “It will not be at all surprising if there is in some quite near decade-and-a-half a similarly swift and equally civilised dash to acceptance of killing off old codgers (by then, like me) as there has been, in so short a twinkling, towards the more emotive act of killing unborn babies.”

In Stalin’s Russia

Why did Norman think as he did? Why did he reject the post-war consensus about the virtues of government? And why did he keep his distance from a new right that embraced so many of his ideas? Part of the answer lies in his personality. Norman was an extraordinarily self-contained figure. He seldom used his telephone to call people, preferring to sit in his office poring over statistics. He had few doubts about the rightness of his opinions. Once he had an idea in his head he pushed it to its logical conclusion—and if he was proved wrong he simply shifted to another idea, which he pursued with equal certainty. Richard Holt Hutton once wrote about Walter Bagehot’s “dash and doubt”. Norman was just dash.

But his outlook was also shaped by his odd adolescence. His father was a British consul in Moscow in 1935-38, and Norman’s summer holidays from school were spent there at the height of Stalin’s purges. He saw members of the embassy staff—including maids his own age—disappearing, probably to be shot. Before and after his posting to Moscow his father also had jobs in Nazi-dominated Europe. Many of his family’s Jewish friends were terrorised and later slaughtered.

When he left school in 1941, Norman wrote later,

my first job was a public-sector one, with public-sector productivity, as a teenager supposed to throw bombs about as an RAF navigator, creating a slum in the heart of the continent. By the time I got there, the Russians were coming in from the other side. All the politicians, including Churchill and Roosevelt, told us these were fine liberating democrats. And of course I knew from those school summer holidays so briefly before that those were astonishing lies. That has given me one advantage in my 40 years as a newspaperman. I have never since then believed a word either politicians or public relations officers have said.

Norman’s early experiences did not just sour him to politicians. They soured him to collectivism in all its many varieties. He had no time for the government-worshipping intellectuals he found when he studied economics at Cambridge in 1945-47. He loathed the feminists and black-power activists he came across in America in the late 1960s and 1970s, smelling in their affection for group rights and their willingness to use intimidation the same intolerance he had smelt in Europe in the 1930s and 1940s. He took his children on trips to eastern Europe in order to teach them the difference between freedom and tyranny. He seldom missed an opportunity to champion the “hard hats” over the “soft heads”.

Norman’s case for market capitalism did not rest merely on its ability to create wealth, but on its capacity to advance individual freedom. He was almost as critical of big-company capitalism as he was of big-government socialism. In a 1976 survey on “The coming entrepreneurial revolution” he argued that big business was as doomed as big government. Hierarchical managers sitting in their skyscrapers could no longer arrange how brain workers should best use their imaginations. The future lay with small firms that could exploit individual creativity and with bigger firms that could split themselves into small centres and encourage competition between them.

Norman’s critique of the welfare state was inspired by a similar belief in individualism. He pointed out that the market had produced a remarkable equalisation in people’s lives. Rich and poor had access to the same consumer goods—the same television programmes, the same comfortable armchairs, the same plethora of goods in supermarkets, which were spreading from the suburbs to the slums. In 1945 the average Englishman had only one pair of trousers; in the swinging 1960s he had access not only to lots of pairs of (tight) trousers but also to holidays in the sun and cheap mortgages.

The great exception to this story of equalisation was the state. The state distributed its largesse disproportionately to the rich—exactly the opposite of what was supposed to happen—allowing them to end up with better schools and better health services. It also trapped the poorest in poverty, in sink estates with lousy schools and soaring crime and in public-sector jobs with little prospect of long-term prosperity. Norman argued that the only way to change this was to empower individuals—to allow them to own their own homes, through privatisation, and to choose their own schools, through vouchers. Give power to the state and you end up with self-serving interest groups. Give power to the individual and you apply the same creative ingenuity to public services as companies have long done to the invention of washing powder.

Norman’s belief in individualism also drove his enthusiasm for technology. This enthusiasm provoked widespread mirth at The Economist. The man who predicted the rise of the internet in 1984 and preached the virtues of telecommuting in articles on almost anything was by far the most incompetent member of the staff when it came to using new (or not so new) inventions. In battles with the office fax machine he usually came off worse. It was rumoured that paper clips baffled him. The staff were amazed when the Atex publishing system was introduced in 1982 and Norman revealed that he could actually type.

But as a techno-visionary he had few equals. He predicted a world in which “books, files, television programmes, computer information and telecommunications will merge”—in which people could explore the world’s knowledge repositories at a touch of a button, and in which readers would have access to custom-made newspapers paid for by targeted advertising (in typical fashion, he imagined this newspaper emerging from a fax machine at the back of the television). He saw that this revolution would have huge implications for the balance of power. Giant organisations such as governments and companies would lose their comparative advantage. Entrepreneurs would be empowered. Taxpayers would flee the coop and telecommute from rural villages—thus putting more pressure on governments to give up their powers and start serving people rather than bossing them about.

The last clue to Norman was that he was a consummate newspaperman. In print—or indeed on the lecture podium—the cackling incoherence of his speech simply vanished, and he was invariably lucid and frequently amusing, even coruscating. (A similar stylishness could be seen on the tennis court, where the immobility of middle age did nothing to inhibit a well-aimed slice that flummoxed younger and nimbler players.) He was one of the best word-coiners of his generation, producing “intrapreneurship” and “telecommuting” (the coinage of “privatisation” and “Eurocrat” is disputed). He littered his prose with memorable phrases. Milton Friedman was “the maddening gnome of Chicago”. American ghettoes exhibited “public squalor amid private non-affluence”. In diagnosing the failure of British firms to get the most out of computers, he likened them to “former slum dwellers who, when promoted into being council-house tenants, tended to keep coal in the bath”. In championing the virtues of entrepreneurship and people working in small teams, he pointed out that “Jesus Christ tried 12, and that proved one too many.”

Everything he wrote was compulsively readable—partly because he mixed battiness with brilliance and partly because he came at everything from such unexpected angles. His 1975 survey of “America’s third century” started by posing a surprising public-policy quandary:

Our children will probably “progressively” be able to order their babies with the shape and strength and level of intelligence that they choose, as well as alter existing human beings so as to insert artificial intelligence, retune brains, change personality, modify moods, control behaviour.

That raised troubling ethical issues which would be best decided by a world that was shaped by America rather than “the inexperienced Japanese”.

Yet it was those Japanese who best demonstrated Norman’s skills as a journalist. In 1962 he visited Japan to get a measure of how the country had changed since the second world war. He learned little from talking to British ex-pats. But then, in a Mitsubishi factory, he came across a British machine-tool salesman who told him that Japanese workers were getting three times as much out of their machines as their better paid British counterparts.

The resulting article, “Consider Japan”, sealed his global reputation as a journalist and turned him into a hero in Japan (on his retirement in 1988 he was honoured by the emperor with the Order of the Rising Sun). He argued that the key to Japanese success lay in their plethora of tiny entrepreneurial component-makers and in their ability to break up huge plants into “small but brotherly” profit centres. He predicted that the Japanese productivity miracle would transform the world economy.

An eternal optimist

But for all his interest in the rest of the world, he was a very English figure. His ideas were rooted in the English liberalism of the 19th century—a liberalism that celebrated the individual over the collective, progress over reaction, free thought over superstition. This set him against both the “over-government” that had triumphed in his youth and the religious conservatism that prospered under Reaganism. But it also turned him into an irrepressible optimist. Few people since Bagehot and Macaulay have been so convinced that life is getting better, and that it will get better still if only a few doltish politicians can be elbowed out of the way.

This commitment to classical liberalism ensures that much of his work continues to sing. Norman devoted his energies to two of the most ephemeral bits of journalism—opinionated leaders and lengthy exercises in futurology. Yet a remarkable amount of what he wrote remains relevant today. His 1975 survey on America’s 200th birthday, in which he chastises the Democrats for flirting with the Fabian cult of government expertise, conservatives for flirting with religious extremism, and business for underinvesting in innovation, might easily be a portrait of Barack Obama’s America. Big government has been on the march for much of the past decade. The Beijing consensus celebrates the alliance of big government and big companies. Much of the public sector has resisted the power of vouchers and internal markets. The battle that Norman fought for so long has still not been won.

Claude Levi-Strauss (RIP)

An Impressive Reading

Title: Fidel Castro, My Life. With Ignacio Ramonet.
Original Title: Fidel Castro, Biografia A Dos Voces.
Translated By: Andrew Hurley.
Published By: Penguin.
Number of pages: 724.

Black Swan

Taleb says rich should not pay more tax to help the poor

A US academic billed as David Cameron's new intellectual guru takes a Darwinian approach to economics and says it is wrong for the rich to pay higher taxes to help the less well-off.

Nassim Nicholas Taleb, a professor of risk engineering at New York University, attacked Barack Obama for increasing his tax bill as part of a series of anti-recessionary measures.

The remarks by Taleb, the conservative author of the book Black Swan, were made during an appearance with Cameron at the Royal Society for the Encouragement of Arts, Manufactures and Commerce (RSA) on Tuesday.

Labour attacked Cameron, who says Taleb's work confirms his own prejudices, because the "eccentric" academic says economic crashes are a good thing.

In some of his most provocative remarks at his appearance with Cameron, the Lebanese-American academic criticised Obama for increasing his taxes as he harked back to Darwin's theory of evolution.

"I happen to do OK. I am paying more taxes," Taleb said. "How can you have evolution if those who do the right thing have to finance those who did the wrong thing? If you are making money in 2009 – that means you have a robust business in the cycle – you are paying more taxes. If you are losing money in 2009 you get a bigger tax break. It is the opposite of everything I believe in."

Taleb has become a conservative folk hero following the success of his book, which examines the phenomena of "Black Swans" or "low-probability, high-impact events" that can have a major impact on the world.

Cameron praised Taleb and said his book had confirmed his own prejudices. "I very much enjoyed Black Swan. I am trying to come to terms with Black Swan thinking and what it might mean for politics … The danger with reading somebody's book is that it just confirms some of your prejudices and that is why you like it," the Tory leader said.

But Taleb has beliefs which are outside the political mainstream in Britain. These include:

• Economic crashes are a good thing. "I like crashes. I just like the world to be robust with them. The world is not robust. In 2000 Silicon Valley was very robust."

• Debt is nearly always dangerous. "Christianity early on did not like debt. Islam banned debt. It is not without reason. The Romans had problems with debt. A lot of wars were caused by debt. So debt was not necessarily a good thing. You say in moderation. But we don't know what moderation is."

• Climate change may not be man-made. "I'm a hyper-conservative ecologically. I don't want to mess with Mother Nature, OK. Even I don't believe that carbon thing is necessarily anthropogenic [man made], right. I just don't want to mess with Mother Nature. I don't understand Mother Nature. It is much more intelligent than us. It has been around for longer than anything else." Cameron made clear he disagrees with Taleb on this.

Taleb yesterday criticised the British press for the reporting of his remarks, saying they may have become "lost in translation". His views on economic crashes had been distorted, he said. "I said that free markets generate fads, crashes, massive movements. Attempts to control the cycle proved futile – what we need is citizens to become robust to them, to be immune to their impact. My point is that we cannot predict Black Swans, but we know their impact and can be prepared for them. Again taken backwards: 'Taleb loves crashes'. This is incompetent journalism in its most insidious form."

Climate experts and bank risk managers have both failed us

I'm not a denier. We just do not know the consequences of our actions

I am honoured to see my conversation with David Cameron at the RSA covered in your paper (Cameron's guru says rich should not pay more tax to help the poor, 20 August). However, your reporting was in complete reverse to my positions on three subjects.

First, you say I believe that "Climate change may not be man-made"; and Lucy Mangan describes me as a "climate-change denier" (This week, 22 August). In fact, ecologically I am hyper-conservative (meaning super-Green), and I am one of the authors of the King of Sweden's recent Bönhamn declaration on attitudes to climate change. My position on the climate is to avoid releasing pollutants into the atmosphere, regardless of current expert opinion. Climate experts, like banking risk managers, have failed us in the past in foreseeing long-term damage. This is an extension of my general belief: "Do not disturb a complex system." We do not know the consequences of our actions (this idea also makes me anti-war), and I have explicitly stated the need to leave the planet the way we got it.

Second, I was portrayed as someone who "loves crashes". By coincidence I spoke at the same venue, the RSA, two and a half years earlier – well before the current crash – as part of my crusade against the risk of financial collapse. I find it depressing that the British public could have saved a trillion pounds and hundreds of thousands of jobs had these hidden systemic risks been addressed.

My position is that a robust system needs to produce frequent crashes, with citizens immune to them, rather than infrequent total collapses which we cannot cope with. By constraining cycles and assuming "no more boom and bust" (as your current government did) you end up with a very large bust – and I am sure that I do not need more events like the recent crisis to prove the point.

Thirdly, I was quoted as saying "How can you have evolution if those who do the right thing have to finance those who did the wrong thing?" But this is not the same as saying "[the] rich should not pay more tax to help the poor", as your headline stated. I spent 13 years fighting bankers' bonuses (when no one else did) and am currently crusading for past payments to be clawed back. I have also shown how regular taxpayers have been financing millionaire bankers' bonuses: "socialism for the losses, capitalism for the profits". We are still financing those who got us here, with tax hikes on those who do the right thing, and larger tax breaks for those who blew us up. Companies who made mistakes and weakened the system are being subsidised by the countercyclical ones who make it more robust.

Nowhere do your articles discuss my central idea, that the risks that were in the system two years ago are still with us now, and that unless we lower debt to "definancialise" the economy (instead of increasing deficits through stimulus) we face more risks of blow-ups. With the same distortion of views one could easily make Karl Marx an apologist of capitalism and Adam Smith a promoter of communism.

Turn Left for Growth

by Joseph E. Stiglitz

Both the left and the right say they stand for economic growth. So should voters trying to decide between the two simply look at it as a matter of choosing alternative management teams?

If only matters were so easy! Part of the problem concerns the role of luck. America’s economy was blessed in the 1990s with low energy prices, a high pace of innovation, and a China increasingly offering high-quality goods at decreasing prices, all of which combined to produce low inflation and rapid growth.

President Clinton and then-Chairman of the US Federal Reserve Alan Greenspan deserve little credit for this – though, to be sure, bad policies could have messed things up. By contrast, the problems faced today – high energy and food prices and a crumbling financial system – have, to a large extent, been brought about by bad policies.

There are, indeed, big differences in growth strategies, which make different outcomes highly likely. The first difference concerns how growth itself is conceived. Growth is not just a matter of increasing GDP. It must be sustainable: growth based on environmental degradation, a debt-financed consumption binge, or the exploitation of scarce natural resources, without reinvesting the proceeds, is not sustainable.

Growth also must be inclusive; at least a majority of citizens must benefit. Trickle-down economics does not work: an increase in GDP can actually leave most citizens worse off. America’s recent growth was neither economically sustainable nor inclusive. Most Americans are worse off today than they were seven years ago.

But there need not be a trade-off between inequality and growth. Governments can enhance growth by increasing inclusiveness. A country’s most valuable resource is its people. So it is essential to ensure that everyone can live up to their potential, which requires educational opportunities for all.

A modern economy also requires risk-taking. Individuals are more willing to take risks if there is a good safety net. If not, citizens may demand protection from foreign competition. Social protection is more efficient than protectionism.

Failures to promote social solidarity can have other costs, not the least of which are the social and private expenditures required to protect property and incarcerate criminals. It is estimated that within a few years, America will have more people working in the security business than in education. A year in prison can cost more than a year at Harvard. The cost of incarcerating two million Americans – one of the highest per capita rates in the world – should be viewed as a subtraction from GDP, yet it is added on.

A second major difference between left and right concerns the role of the state in promoting development. The left understands that the government’s role in providing infrastructure and education, developing technology, and even acting as an entrepreneur is vital. Government laid the foundations of the Internet and the modern biotechnology revolutions. In the nineteenth century, research at America’s government-supported universities provided the basis for the agricultural revolution. Government then brought these advances to millions of American farmers. Small business loans have been pivotal in creating not only new businesses, but whole new industries.

The final difference may seem odd: the left now understands markets, and the role that they can and should play in the economy. The right, especially in America, does not. The New Right, typified by the Bush-Cheney administration, is really old corporatism in a new guise.

These are not libertarians. They believe in a strong state with robust executive powers, but one used in defense of established interests, with little attention to market principles. The list of examples is long, but it includes subsidies to large corporate farms, tariffs to protect the steel industry, and, most recently, the mega-bail-outs of Bear Stearns, Fannie Mae, and Freddie Mac. But the inconsistency between rhetoric and reality is long-standing: protectionism expanded under Reagan, including through the imposition of so-called voluntary export restraints on Japanese cars.

By contrast, the new left is trying to make markets work. Unfettered markets do not operate well on their own – a conclusion reinforced by the current financial debacle. Defenders of markets sometimes admit that they do fail, even disastrously, but they claim that markets are “self-correcting.” During the Great Depression, similar arguments were heard: government need not do anything, because markets would restore the economy to full employment in the long run . But, as John Maynard Keynes famously put it, in the long run we are all dead.

Markets are not self-correcting in the relevant time frame. No government can sit idly by as a country goes into recession or depression, even when caused by the excessive greed of bankers or misjudgment of risks by security markets and rating agencies. But if governments are going to pay the economy’s hospital bills, they must act to make it less likely that hospitalization will be needed. The right’s deregulation mantra was simply wrong, and we are now paying the price. And the price tag – in terms of lost output – will be high, perhaps more than $1.5 trillion in the United States alone.

The right often traces its intellectual parentage to Adam Smith, but while Smith recognized the power of markets, he also recognized their limits. Even in his era, businesses found that they could increase profits more easily by conspiring to raise prices than by producing innovative products more efficiently. There is a need for strong anti-trust laws.

It is easy to host a party. For the moment, everyone can feel good. Promoting sustainable growth is much harder. Today, in contrast to the right, the left has a coherent agenda, one that offers not only higher growth, but also social justice. For voters, the choice should be easy.

Joseph E. Stiglitz, Professor at Columbia University, received the 2001 Nobel Prize in economics. He is the co-author, with Linda Bilmes, of The Three Trillion Dollar War: The True Costs of the Iraq Conflict.

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