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The Financial Times Says: "Daniel Davies Told Us So!"

Lina Saigol:

Warning by bank 10 years ago was ignored: The Bank of England issued a stark warning to the City of London more than a decade ago that big bonuses encouraged traders to take excessive risks – but no action was taken. The Bank’s financial stability review published in March 1997 warned that large, variable bonuses that depended on some measure of performance could become a one-way bet for traders. Dealers won if they generated profits for the business but did not have to pay back their bonuses if they lost money.

“The highest bonuses usually go to ‘stars’, who may feel compelled to justify their status by taking greater risks in the hope of making higher and higher profits,” Daniel Davies, a senior economist at the Bank wrote. “Employees’ contracts almost always involve limited liability; they may share profits from favourable trading outcomes but it is difficult or impossible to make them compensate their employers for losses,” he added. That same year, Howard Davies, then the Bank’s deputy governor, threatened to set more stringent capital requirements for banks that paid big bonuses.

The City’s high-octane performance culture was being blamed for catastrophes, including the £860m of losses run up by Nick Leeson, the futures trader who sank Barings in 1995. Daniel Davies recommended that banks consider introducing deferred bonus schemes, where bonuses would be allocated for a trading period but not paid until some time later. “This gives firms the opportunity to pay negative bonuses by removing money from the deferred bonus if performance deteriorates,” the economist wrote.

The Bank wanted bonus schemes to put greater emphasis on traders’ long-term performance. But City institutions defended their pay practices and said that attempts to regulate would be counter-productive.

In general, I think, the Financial Times--and a fortiori any other newspaper--could improve its quality by simply running a daily box containing archive entries from Daniel Davies's weblog, like:



Why You Should Invest in Private Equity: Daniel Davies gives the big important argument for investing in private equity:

Dear investors,

If you believe that you have the self-discipline to "buy and hold" a portfolio of "mid cap value stocks" for ten years, despite the fact that during that time many of them will deliver heartbreakingly awful newsflow and earnings, then go for it.

Love,

The private equity industry.

PS: The evidence of the entire history of investing is that you don't.


Hypocrisy as a virtue:

[T]he question of "hypocrisy" bears a bit more explanation because it does appear to go to the heart of a lot of people's emotional politics. Think about it this way. In my post below, I suggested that the difference between the progressivity of the tax systems students suggested for income versus for their own grades "might serve as a useful index of the hypocrisy of leftist students". When I use the word "hypocrisy" here, what do we actually mean? Well, the combination of the following two qualities:

  1. A moral belief that (some loosely defined concept of) equality is (an actual or instrumental) good.
  2. A personal desire to accumulate more, even at the expense of others.

The first is simply a baseline definition of what it means to have left wing politics. The second ... well put it this way, Buddhist monks spend twenty years living ascetically and meditating for hours at a time before they presume to believe that they have conquered all selfish desires. If you're talking about "leftist hypocrisy", you're just talking about "leftists who have not been able to transcend history, biology and socialisation in order to develop an unparticularised love for all sentient things". In other words, you're just talking about "leftists who happen to be humans".

Contrast with rightwing politics. As I've posted earlier, the single most sensible thing said in political philosophy in the twentieth century was JK Galbraith's aphorism that the quest of conservative thought throughout the ages has been "the search for a higher moral justification for selfishness". Some rightwingers are not hypocrites because they admit that their basic moral principle is "what I have, I keep". Some rightwingers are hypocrites because they pretend that "what I have, I keep" is always and everywhere the best way to express a general unparticularised love for all sentient things. Then there are the tricky cases where the rightwingers happen to be on the right side because we haven't yet discovered a better form of social organisation than private property for solving several important classes of optimisation problem. But at base, the test of someone's politics is simple; if their political aim is to advance all of humanity, they're on our side, while if they have an overriding constraint that the current owners of property must always be satisfied first, they're playing for the opposition. Hypocrisy doesn't really enter into the equation with rightwing politics; you don't (or shouldn't) get any extra points for being sincere about being selfish.

So where does that leave our students? Well, they're young. They're most likely insecure. They don't actually have a lot, and it's hardly surprising that they're a bit precious about what they have (a close runner for the most sensible thing said in political philosophy in the twentieth century was Michael Oakeshott's remark that "a conservative is a man with something to lose", and the genius of this remark is its ambiguity). One shouldn't blame them for not being Boddhisattvas.

In general, one of the biggest problems with the psychological politics of left and right is the need that people feel to think of themselves as not just having made what looks like on balance the best decision given the things they regard as important, but as morally good people themselves. People in general seem to be horribly uncomfortable with the idea that, by the standards they use to judge political situations, they themselves don't come out as moral heroes. At base, this is a fairly childish and decidedly illiberal attitude; childish because it demands a sort of moral perfection which everyone intellectually knows can't exist outside fairy stories (unless you count the way that parents appear to their children) and illiberal because it suggests that you're only prepared to have normal social interactions with people who pass your own personal moral examination (a rather prominent political philosopher has told me to my face on a couple of occasions that he regards me as morally beyond the pale because of the job I do; I've nonetheless been made to feel very welcome at his house).

So anyway, hypocrisy in people is not a vice, particularly when the alternative is to be sincerely horrible. In political parties, it's much worse; people who presume to take control of the state's monopoly on the use of ppowerhave to be held to a much higher standard of honesty, because they are explicitly asking for us to trust them on matters important to our lives. A double standard? Perhaps. But I just told you that I don't care about hypocrisy. Perhaps I should have termed my imaginary measure above an "index of political self-righteousness". On which score, it seems fairly clear, the political science professor himself would outscore most of his students.


D-squared Digest -- FOR bigger pies and shorter hours and AGAINST more or less everything else:

Hullo there Paul Krugman readers. Yes, I did say "Good ideas do not need lots of lies told about them in order to gain public acceptance", and as a general maxim I wholeheartedly recommend it. I don't necessarily, however, either endorse or whatever-the-opposite-of-endorse the specific use of that maxim in the context of Prof. Krugman's post about the Paulson bailout plan; I don't actually have a fully formed view about that plan. I do, however, wholeheartedly endorse "Development, Geography and Economic Theory", which I think is a terribly underrated economics book, and am at this moment rather starstruck at having one of my essays admired by the nearest modern equivalent to my hero JK Galbraith...


The D-Squared Digest One Minute MBA - Avoiding Projects Pursued By Morons 101:

Literally people have been asking me: "How is it that you were so amazingly prescient about Iraq? Why is it that you were right about everything at precisely the same moment when we were wrong?" No honestly, they have. I'd love to show you the emails I've received, there were dozens of them, honest. Honest. Anyway, I note that "errors of prewar planning" is now pretty much a mainstream stylised fact, so I suspect that it might make some small contribution to the commonweal if I were to explain how it was that I was able to spot so early that this dog wasn't going to hunt. I will struggle manfully with the savage burden of boasting, self-aggrandisement and ego-stroking that this will necessarily involve. It's been done before, although admittedly by a madman in the process of dying of syphilis of the brain. Sorry, where was I?

Anyway, the secret to every analysis I've ever done of contemporary politics has been, more or less, my expensive business school education (I would write a book entitled "Everything I Know I Learned At A Very Expensive University", but I doubt it would sell). About half of what they say about business schools and their graduates is probably true, and they do often feel like the most collossal waste of time and money, but they occasionally teach you the odd thing which is very useful indeed. Here's a few of the ones I learned which I considered relevant to judging the advisability of the Second Iraq War.

Good ideas do not need lots of lies told about them in order to gain public acceptance. I was first made aware of this during an accounting class. We were discussing the subject of accounting for stock options at technology companies. There was a live debate on this subject at the time. One side (mainly technology companies and their lobbyists) held that stock option grants should not be treated as an expense on public policy grounds; treating them as an expense would discourage companies from granting them, and stock options were a vital compensation tool that incentivised performance, rewarded dynamism and innovation and created vast amounts of value for America and the world. The other side (mainly people like Warren Buffet) held that stock options looked awfully like a massive blag carried out my management at the expense of shareholders, and that the proper place to record such blags was the P&L account.

Our lecturer, in summing up the debate, made the not unreasonable point that if stock options really were a fantastic tool which unleashed the creative power in every employee, everyone would want to expense as many of them as possible, the better to boast about how innovative, empowered and fantastic they were. Since the tech companies' point of view appeared to be that if they were ever forced to account honestly for their option grants, they would quickly stop making them, this offered decent prima facie evidence that they weren't, really, all that fantastic.

Application to Iraq. The general principle that good ideas are not usually associated with lying like a rug1 about their true nature seems to have been pretty well confirmed. In particular, however, this principle sheds light on the now quite popular claim that "WMDs were only part of the story; the real priority was to liberate the Iraqis, which is something that every decent person would support".

Fibbers' forecasts are worthless. Case after miserable case after bloody case we went through, I tell you, all of which had this moral. Not only that people who want a project will tend to make innacurate projections about the possible outcomes of that project, but about the futility of attempts to "shade" downward a fundamentally dishonest set of predictions. If you have doubts about the integrity of a forecaster, you can't use their forecasts at all. Not even as a "starting point". By the way, I would just love to get hold of a few of the quantitative numbers from documents prepared to support the war and give them a quick run through Benford's Law.

Application to Iraq This was how I decided that it was worth staking a bit of credibility on the strong claim that absolutely no material WMD capacity would be found, rather than "some" or "some but not enough to justify a war" or even "some derisory but not immaterial capacity, like a few mobile biological weapons labs". My reasoning was that Powell, Bush, Straw, etc, were clearly making false claims and therefore ought to be discounted completely, and that there were actually very few people who knew a bit about Iraq but were not fatally compromised in this manner who were making the WMD claim. Meanwhile, there were people like Scott Ritter and Andrew Wilkie who, whatever other faults they might or might not have had, did not appear to have told any provable lies on this subject and were therefore not compromised.

The Vital Importance of Audit. Emphasised over and over again. Brealey and Myers has a section on this, in which they remind callow students that like backing-up one's computer files, this is a lesson that everyone seems to have to learn the hard way. Basically, it's been shown time and again and again; companies which do not audit completed projects in order to see how accurate the original projections were, tend to get exactly the forecasts and projects that they deserve. Companies which have a culture where there are no consequences for making dishonest forecasts, get the projects they deserve. Companies which allocate blank cheques to management teams with a proven record of failure and mendacity, get what they deserve.

I hope I don't have to spell out the implications of this one for Iraq. Krugman has gone on and on about this, seemingly with some small effect these days. The raspberry road that led to Abu Ghraib was paved with bland assumptions that people who had repeatedly proved their untrustworthiness, could be trusted. There is much made by people who long for the days of their fourth form debating society about the fallacy of "argumentum ad hominem". There is, as I have mentioned in the past, no fancy Latin term for the fallacy of "giving known liars the benefit of the doubt", but it is in my view a much greater source of avoidable error in the world. Audit is meant to protect us from this, which is why audit is so important.

And so the lesson ends. Next week, perhaps, a few reflections on why it is that people don't support the neoconservative project to bring democracy to the Middle East (a trailer for those who can't wait; the title is going to be something like "If You Tell Lies A Lot, You Tend To Get A Reputation As A Liar"). Mind how you go.


I find myself with a few spare minutes and make the mistake of reading Thomas Friedman again...:

I find myself with a few spare minutes and make the mistake of reading Thomas Friedman again. His conclusion after a long, dull and witless ramble about the introduction of "democracy" to Iraq (just what the Gulf region needs, more puppet states) reads "If [it is] done right, the Middle East will never be the same. If done wrong, the world will never be the same". There's not much you can say to that except "shut up you silly man". But it does inspire in me the desire for a competition; can anyone, particularly the rather more Bush-friendly recent arrivals to the board, give me one single example of something with the following three characteristics:

  1. It is a policy initiative of the current Bush administration
  2. It was significant enough in scale that I'd have heard of it (at a pinch, that I should have heard of it)
  3. It wasn't in some important way completely &*%$@# up during the execution.

It's just that I literally can't think what possible evidence Friedman might be going on in his tacit assumption that the introduction of democracy to Iraq (if it is attempted at all) will be executed well rather than badly. Worst piece of counterfactual speculation by Friedman since the day he pondered the question "If I grew a moustache well, I would look distinguished and stylish; if I grew one badly, I'd look like a pillock".


Reputations are made of...:

[T]he concept of “military strategy” he is talking about here comes directly from Thomas Schelling. The idea is that the war is costing huge amounts of money and lives with no real prospect of success and a distinct danger that it is making things much worse. However, to do the logical thing would send the signal to our enemies that we will give up if fought to a pointless bloody standstill.Therefore, for strategic reasons, we must redouble our efforts, in order to send the signal to our enemies that we will fight implacably and mindlessly in any battle we happen to get into, forever, in order to dissuade them from attacking us in the first place. It’s got the kind of combination of “counter-intuitive” thinking and political conveniencethat always appeals to the armchair Machiavelli, as well as to the kind of person who thinks it’s witty to describe things as “Economics 101”(Airmiles has been all over this one for ages, naturally). What’s it like as a piece of game-theoretic reasoning?

Lousy. It is certainly true that one of the benefits of doing something stupid is that it saves you from having to spend money on maintaining your reputation as an idiot. However, is the reputation of an idiot really worth having?

It turns out that it can be proved by theorem that the answer is no. If the game of being a belligerent idiot with no sensible regard for one’s own welfare was worth the candle, in the sense of conferring benefits which outweighed the cost of gaining it, then everyone would want to get that reputation, whether they were genuinely an idiot or not. But if everyone wanted that reputation,then everyone would know that simply acting like an idiot didn’t mean that you were one, in which case it would be impossible to establish a reputation as an idiot in the first place. The point here is that it’s one of the more important things in game theory that a signal has to be a costly signal to be credible; like membership of the Modern Languages Association, a reputation in deterrence theory is something that is worth having, but not worth getting. People who use the word “signal” in this context (usually on the basis of a poorly understood or second-hand reading of Schelling) don’t always seem to realise that they are explicitly admitting that the costs of being in Iraq are greater than the benefits.

Because of this, in my opinion it is very difficult for a democracy to establish this kind of credibility. The reason is that although leaders are often idiots, democratic polities rarely are. It is very hard for a democratically elected leader to credibly commit to a policy of stupidity, because everyone else knows that it is highly likely that the electorate will not support it. I hasten to add that to take this obvious fact and turn it into a Dolchstosslegende, or to bemoan the lack of national vigour in the manner of Victor Davis Hanson is to get the analysis back to front. It is a good thing about democracies that they don’t in general do stupid things, and the fact that an argument from “credibility” and “deterrence” can be constructed to make the case that it is a weakness (even “a fatal weakness”) of democracies that they are insufficiently inclined to pointless military dead-endism is just another example of the Davies-Folk Theorem. Here’s the same point made by someone else if you like it dressed up in numbers and 2×2 boxes.

Furthermore, even if we were to accept this bogus argument, it is worth remembering that it is of rather general application. As the marketers will tell you, delivery has to be consistent with the brand; you can’t tell people to ignore part of your message. If it were true that by sticking it out past the bitter end,we were signalling that we were bitter-enders, then what othermessages might we have been sending out over the last few years? In particular, what message does our behaviour since 2003 convey on such important topics as: whether or not we want to fight a war against theIslamic ummah? Or whether the best way to protect yourself against us invading you is to get nuclear weapons? Or whether we are reliable allies? Whether our public statements to the United Nations can be trusted? When you start thinking in these terms, you start really worrying about the reputation that we are actually getting.


"Tricky Cases Where the Rightwingers Happen to Be Right" Department:

[T]he single most sensible thing said in political philosophy in the twentieth century was JK Galbraith's aphorism that the quest of conservative thought throughout the ages has been "the search for a higher moral justification for selfishness". Some rightwingers are not hypocrites because they admit that their basic moral principle is "what I have, I keep". Some rightwingers are hypocrites because they pretend that "what I have, I keep" is always and everywhere the best way to express a general unparticularised love for all sentient things. Then there are the tricky cases where the rightwingers happen to be on the right side because we haven't yet discovered a better form of social organisation than private property for solving several important classes of optimisation problems...


No Riff-Raff:

Entering into the Brad DeLong Eat The Rich Controversy, I offer this observation: If it is not the case "that the rich are spiteful--that they enjoy the envy of the poor", then why is the word "exclusive" so popular in the marketing material for hotels, nightclubs, holiday resorts and residential property developments.

"Exclusive" is probably these days an advertising man's synonym for "nice", but it also has a clear and specific literal meaning. It means that the hotel, nightclub, resort etc is providing a bundled service; partly, the provision of a normal hotel or nightclub, and partly the service of excluding a segment of the population from that service. One pays extra to go to a health club whose swimming pool is not polluted by the greasy, hairy polloi.

The reason that this service is valuable is that those who consume it get utility from a) dividing society into two groups, rich and poor, b) creating institutions which physically and socially segregate these two groups and c) them being in the "rich" group. Nobody would apply for membership of Bouji's or the Bucks if it was just a matter of waiting your turn and paying your fee. This would completely defeat the point of the exercise and destroy the value proposition. The point is that in order to attract a better class of customer, you have to keep the riff-raff out. Basil Fawlty understood this; why doesn't the blogosphere?


Is there a general skill of “management”?: Synopsis: yes.

I promised this post in comments to Chris’s on Blackburn’s myths below, where I took my life in my hands and disagreed with John. I think that actually, there probably is “a general skill called management which works in any and all domains”, and, just to raise the tariff and secure gold medal position for myself in the Steven Landsburg Memorial Mindless Contrariolympiad, I’ll also defend the proposition that this skill is pretty closely related to what they teach on MBA courses. But first a couple of remarks on Blackburn’s own “Myth of Management“.

In his very definition, Blackburn pretty much gives it away; he says that “[the myth of management] claims that people can be managed like warehouses and airports”. What does this even mean? How do you manage a warehouse or an airport if it’s impossible to manage people? If he had said “like machines” or even “like factories”, then it might have been comprehensible, but a warehouse which doesn’t have any people working in it is just a shed full of stuff and doesn’t require any management because no deliveries or shipments are being made. And an airport without people is just a warehouse for planes. Warehousing and transport are two very labour-intensive industries.

There are two possibilities here. One is merely that Blackburn is a snob – that writing as a professor of philosophy in the THES, he felt entitled to assume his audience would know that “people” meant “middle class people”, and would agree with the implicit assertion that “people” of this sort were capable of independent thought and could not be tied down, man, unlike the meat robots who packed their books for Amazon or swiped their tickets at Heathrow. But to assume this would be wildly uncharitable. The other, and I think more likely, explanation, is that Blackburn has no idea whatsoever about what managing a warehouse or an airport would entail, and no real interest in finding out.

There is a clear analogy here to CP Snow’s famous point about “Two Cultures”;

A good many times I have been present at gatherings of people who, by the standards of the traditional culture, are thought highly educated and who have with considerable gusto been expressing their incredulity of scientists. Once or twice I have been provoked and have asked the company how many of them could describe the Second Law of Thermodynamics. The response was cold: it was also negative. Yet I was asking something which is the scientific equivalent of: Have you read a work of Shakespeare’s?

I now believe that if I had asked an even simpler question—such as, What do you mean by mass, or acceleration, which is the scientific equivalent of saying, Can you read?—not more than one in ten of the highly educated would have felt that I was speaking the same language. So the great edifice of modern physics goes up, and the majority of the cleverest people in the western world have about as much insight into it as their neolithic ancestors would have had

What I mean, of course, is that if a middle manager were to mention over the dinner table that one of his proudest boasts was that he had never engaged in abstract thought in the last twenty years, had consistently managed to avoid doing so throughout his career, and that indeed whenever he was asked to provide an informed opinion on a general or abstract subject, he typically did it intentionally badly in order to make sure he was never asked again, then we would presumably agree that we were dealing with an unusually awful species of pig-ignorant chucklehead.

And yet of course, for both of CP Snow’s intellectual cultures, the parallel view of administration and management is so commonplace as to be a cliche. The abhorrence of academics of management is notorious (the abominable fashion in which so many academic institutions are actually managed even more so). Conversely, the practical men of engineering have developed an entire culture of their own based round the assumption that everything in the world is done by small groups of engineers who spontaneously organise themselves into work units, with occasional interference and distraction caused by “marketroids” who perform no function at all. Very rare indeed is a figure like Fred Brooks who actually applies scientific principles to the analysis of the organisation of computer programmers, and when he does arise, he’s honoured but largely ignored; real engineers write code, they don’t do admin.

This of course has fairly severe real-world consequences. As anyone who followed the link to my comment in the first paragraph will know, the kernel of my argument for the existence of a general skill of management is that it is pretty obvious that there is a general deficit or “negative skill” of mismanagement, which equally obviously appears to work in roughly the same way in a variety of fields, and that therefore an opening stab at a definition of the general skill of management would be that it’s the absence of this deficit. Someone like Larry Summers had a particular form of this deficit in spades. It was widely known, throughout the economics profession and beyond, that Summers was not good at handling people. The job of President of Harvard is a management job, the vast majority of which involves being good at handling people. Nevertheless, Summers was given the job by fellow academics who respected his intellect, energy and ideas and who either rationalised to themselves or never even considered the fact that they were giving an important job to somebody who very clearly didn’t have the necessary skills for it.

Then a year later, he had crashed and burned in the job, because he was no good at handling people. Nobody learned a damn thing from this debacle, of course; in general, lots of institutions are surprisingly resistant to the idea that talent in management ought to be a criterion for awarding management jobs, and the reason is that they don’t believe in a general skill of management, despite universally recognising (and often admitting to possessing) a generally applicable skill of disorganisedness.

The general skill of management has two basic components – administration and leadership.

The first is the ability to keep track of and prioritise detail. Some people are naturally better at this than others, but natural ability doesn’t actually make much of a difference in terms of one’s possession of the skill of management. The reason for this is that more or less any management task bigger than a single in-tray (and there are plenty of us, including me, who are flat out keeping control of one of those) is going to exhaust a normal human being’s memory and attention span. In order to cope with this, people through the ages have come up with a number of technologies to extend the human ability to administrate, such as alphabetical filing systems, double-entry accounts, activity reports and so on; the majority of the structures in Fred Brooks’ book fall into this category too. The majority of the skill of organisation is having the mastery of these tools and the self-discipline to use them consistently. The first is what they teach you in business schools; the second sounds more like an innate ability, but I would guess that it too can be taught.

The second is basically a species of emotional intelligence; some people are better applied psychologists than others. I must say I didn’t get much out of the “leadership” course I went on, but I wouldn’t necessarily say that there is nothing about motivating and managing people that can be taught; at the very least there’s an obvious body of applied economics which could be brought to bear to make sure that you don’t create incentives which are fundamentally inimical to yourself. So in summary, I think that there is a pretty identifiable set of skills, which can be grouped together into a category at least as coherent as most of the other things that we regard as subjects and which can be defensibly identified as the general skill of management ability.

Of course, the fact that there’s a general skill of management doesn’t mean that everything can be managed, any more than the fact that there’s a general attribute of strength means that everything can be lifted. Organisations have a lot more to them than the simple will of the people managing them and some organisations can be (or become) so pathological that there’s no managing them – either they’re too lacking in the necessary infrastructure to administer, or they’re so riven with interpersonal conflicts or perverse incentives that they can’t be led, or both.

Nor does it necessarily mean that there is a caste of individuals who can be dropped into managerial roles in any organisation and immediately start managing successfully; any organisation above trivial size is going to have a lot of idiosyncratic information (explicit and tacit) which is relevant to its management, and learning this is a difficult or even impossible task. On the other hand, it does suggest that if you have a management problem, there is some sense in asking someone who’s really good at management if they have some advice about it, which is the basis of the consultancy industry (a rather large global industry, which certainly might owe its existence purely to the desire of a self-perpetuating elite to look after their own and act as scapegoats for unpopular decisions; on the other hand, a lot of people think university education is just a racket providing certificates of entry to the middle class, and they’re wrong too).

What it does mean is that the fundamental attribution error is not always an error in this context. As in military matters, where the different abilities of generals often really do make an important difference, it really can be the case that one company succeeds and another fails because of the abilities of the person at the top. There really is a right way and a wrong way to run a warehouse.


Beyond the area of his expertise:

dsquared 04.28.08 at 8:37 am

The myth that there exists a general skill called management which works in any and all domains has been repeatedly refuted.

I don’t agree with this and should probably write a post on the subject. (The kernel of my argument is that there definitely exists a deficit or negative skill called “disorganisation” which works in any and all domains).


Venue Change:

It is a strange fact about organisations that although we can put men on the moon and grow human ears on the backs of mice, there is no force on earth that can stop people from double-booking rooms. One of the most unrealistic things about Star Wars is that Darth Vader never swept into a conference room ready to do something dramatic and evil, only to find a bunch of IT people with sandwiches having their monthly planning meeting.


What do we owe?:

On the front page of the Times today, it appears that the UK is attempting to wriggle out of its commitments to Iraqi employees of the British Army, even as we’re preparing to leave Basra. Part of me wants to believe that this is a matter of bureaucratic callousness rather than anything else, but as Brad DeLong says, the Cossacks work for the Czar – if people in David Milliband’s department are trying to wriggle out of a commitment that David Milliband made, then they’re doing it because he told them to, or because he doesn’t care whether they do it or not.

The last time we had a discussion of this on Crooked Timber, it turned pretty ugly pretty quickly, but I’m prepared to have another go. The general obligations of a country which is carrying out a morally unjustified war of aggression[1] to the locals of the country it is invading are set out pretty clearly in the relevant Geneva Conventions, but what special obligations exist to local employees?

Personally I think this is pretty cut and dried. On grounds of fairness, the invading power should not discriminate between its employees on grounds of nationality, so they have a duty to give local employees the same kind of protection against harm that they would one of their own citizens. On prudential grounds, it is fairly obvious that any country has a long-term interest in establishing a reputation for protecting its employees. I am not convinced by any of the arguments against, most of which seem to involve fairly empty assertions about whether people might have been accessories to war crimes, combined with a strange insouciance about whether these alleged offences should be prosecuted in a proper court, or enforced ad hoc by death squads.

If anyone wants to argue either side of the case, go ahead. If you end up being convinced by my view, then perhaps you’d care to express this opinion to the British government. As far as I can tell, the most effective means to doing this (by far – the difference to the next best alternative is orders of magnitude) is by writing a letter or email to your MP. Dan Hardie has got a lot of anecdotal evidence that these letters have made a big difference so far in preventing this issue from being swept under the rug. (Update: You could ask your MP to sign Early Day Motion 401, tabled by Lynne Featherstone MP, please).


Simple answers etc etc:

In the course of an article arguing that a large vote for Obama is not a vote for his policies (and, equally curiously, that the total and utter failure of conservative policies is not in and of itself a reason to try something else), Gerard Baker, who is to Thomas Friedman as Ricky Valance was to Richie Valens, says:

What, in these circumstances, would a scientific model predict as the winning margin for the Democratic presidential candidate: 10, 15, 20 percentage points? In fact, as of yesterday, Mr Obama seemed to have a solid but by no means overwhelming advantage of between 5 and 6 percentage points.

In fact, the Ray Fair model, with default values, predicts four points.

It is actually quite easy to look these things up you know.

And the chorus:

arbitrista 10.31.08 at 2:48 pm: I’ve always liked the Abramowitz model better. http://www.forecastingprinciples.com/PollyVote/images/articles/abramowitz_forecasting2008_timeforchange.pdf

Steve LaBonne 10.31.08 at 3:12 pm: See, it’s against the “journalist” trade rules to actually look stuff up, but now maybe he can report “Daniel Davies claimed…”

Michael Drake 10.31.08 at 3:36 pm: Easier though to ask tendentious rhetorical questions.

Daniel 10.31.08 at 3:38 pm: That was the easy gotcha, but what really did astound me is that Baker seems to argue: the only reason that Obama is popular is that conservative policies have been a dreadful failure, thus he is not really popular, thus his (presumed non-conservative) policies are not really supported by the American population, thus if elected, he only has a mandate to carry out a policy agenda which is not only ex hypothesi disastrous, but (also ex hypothesi) extremely unpopular. I do wonder – what could the American people actually do, if they wanted to convince Gerard Baker that they don’t want conservative policies? Clearly, simply saying that they don’t like them in opinion polls doesn’t work, and nor does voting for the candidate who promises to get rid of them. Do you think that boycotting Murdoch owned newspapers and sending a letter to News Corporation demanding that Gerard Baker be horsewhipped until he gets the message might work? Isn’t it at least worth a try.

J Thomas 10.31.08 at 3:55 pm: How could we get explanations about how stupid Baker’s points are, out to many of the people who read Baker and don’t think about it enough to see through it? They’re the appropriate target audience for criticism of his reasoning, right?

MQ 10.31.08 at 3:58 pm: yeah, the Abramowitz model predicting a 10 point Democratic win seems much more correct. On the other hand, I think a major reason Obama isn’t up by 10 is that McCain is running hard away from Bush. And a 10 point Dem win on election day isn’t out of the question.

See, it’s against the “journalist” trade rules to actually look stuff up

right…no facts please, I’m a reporter!

Preachy Preach 10.31.08 at 4:12 pm: I thought you had a ‘no-US elections’ rule…

Matthew 10.31.08 at 4:14 pm: On the other hand it’s better than Melanie Phillips, who has convinced herself that the Americans are voting for marxism and capitulation to the enemy.

Lex 10.31.08 at 4:24 pm: No, Mel P is better, because reading her is more fun. Question for those in a predictive mood – can the insanity of the wingnut commentariat grow any greater, without posing a serious danger to the stability of the body politic itself [e.g. by provoking poor saps to actually try to kill elected officials…]? Or can it achieve a steady-state derangement, where those of us with critical faculties just have to accept that our interlocutors across the proverbial aisle are not functioning on the same plane of reality, and yet life goes on? Yes, wingnuttery has a long and ignoble history back to McCarthy and beyond, but is the intensity of circulation it achieves with modern technology propelling us to disaster, or is it all somehow survivable, no matter how bad it gets?

Righteous Bubba 10.31.08 at 4:47 pm:

On the other hand it’s better than Melanie Phillips, who has convinced herself that the Americans are voting for marxism and capitulation to the enemy.

Encourage it. It’s self-marginalization.

nick s 11.01.08 at 6:28 pm: I’ve seen the ‘so, why isn’t Obama leading in the polls by 20 points?’ line from a number of right-wing sources, without a retroactive apology for treating, say, GW Bush’s 2004 victory as an overwhelming popular mandate. Gerard Baker may well be too dense to appreciate that a 53-47 popular vote spread generally makes the electoral college map look like this. I do wonder – what could the American people actually do, if they wanted to convince Gerard Baker that they don’t want conservative policies? Move en masse to Canada France Norway.


Fat Hominid:

There’s a paper to be written at some point on the economics of fad diets (I suspect that it already exists and that there’s a 90% chance it’s dreadful). I personally believe that they’re potentially a rich source for the self-organising systems literature and a good case study of how irrational and somewhat self-destructive beliefs spread through proselytisation (a subject which one might think of quite important general interest in these troubled times). My sketch model of something like the Atkins Diet or cabbage soup detox or whatever would go as follows, on the assumption that the spread of these trends through the population is based on about 10% fundamentals and 90% bubble.

The idea being that nearly everyone’s digestive system is different; when one stops to think about it, this is unbelievably, blindingly obvious from simple casual empiricism. Different foods agree and disagree with different people, depending on flukes of genetics, medical history, intestinal flora and whatever else. There is also a space of fad diets which can, to a first approximation, be modelled as more or less spanning the possible combinations of foods – there are literally hundreds of the bloody things out there. For this reason, every now and then, someone is going to come across a fad diet which really really really works, for them, because it happens to not include whatever food is giving them their current digestive troubles.

Someone like that is very likely to become an evangelist for their preferred fad diet; after all, they have first-hand empirical evidence that it really really really works. And sudden relief from digestive discomfort, or very rapid weight loss, is an experience the emotional impact and profundity of which should not be underestimated[1]; it’s the sort of thing which is often mistaken for a religious experience. A particularly passionate advocate for a fad diet can often persuade a couple of dozen acquaintances to try it out, with the obvious potential for a chain reaction if one of them happens to have a similar digestion. I’m sure Kieran could draw you a graph.

Of course, the vast majority of people on fad diets are getting no real benefit from them, other than from the incidental factor that most of them are basically calorie controlled (either by design or, per Atkins Diet, de facto by simply being such inconvenient and unpleasant ways to eat). Thinking about these sorts of things and their spread through the community gets you onto the subject quite quickly of Charles Mackay and Extraordinary Popular Delusions, which is why it’s a bit of a disappointment to me to see that a sharp cookie like Nassim Nicholas Taleb[2] appears to have fallen hook line and sinker for a fad diet.


There ain’t no “just war”, there’s just war:

One of the inevitable consequences of any Middle Eastern conflict is the collateral damage caused by the unprovoked and disproportionate attacks which tend to be launched by Michael Walzer on his own credibility.... I kid, I kid, of course. I have no real problem with the way he shapes the argumentation around the policy; Walzer has built up a huge amount of social capital in the political philosophy world, he can’t take it with him and if he wants to spend it this way, fair enough.

What irks me though, is that throughout the piece, Walzer asks important questions in a manner which is meant to suggest that he is the first to raise them, when for the most part they are extremely cut and dried points of international humanitarian law... he doesn’t quite realise that... the publication of “Just and Unjust Wars” was not the most important thing in the subject area to happen in 1977; that was the year that the Protocols to the Geneva Convention were agreed. And the really striking thing is that the Protocols (particularly Protocol 1, Article 57) actually answer most of the questions Walzer asks, and do so for the most part in a much clearer, more intellectually rigorous and more morally acceptable way than anything he says himself, after thirty years’ reflection on a theory he largely invented.

For example, Walzer correctly states that the concept of “proportionality” in just war theory is all over the place and is much more often used as an excuse for unacceptable violence than as a proscription on it. Score one for the Geneva architecture, which doesn’t use such a fuzzy concept at all. Under Protocol 1, Article 57, a commander has three duties (explained very clearly in “Constraints on the Waging of War: An Introduction to International Humanitarian Law” by Frits Kalshoven and Liesbeth Zegveld):

  1. to do everything feasible to verify that the chosen target is a military objective
  2. to take all feasible precautions in the choices of means and methods to avoid, or in any event minimise harm to civilians and damage to civilian objects
  3. to refrain from carrying out an attack if may be reasonably be expected to cause such harm or damage in a quantity which would be excessive relative to the concrete and definite military advantage anticipated.

So, under international law, for example, “minimising civilian casualties” is a basic primary requirement – it’s something you always have to do, not something you get extra brownie points for and certainly not something you can trade off against a slightly dodgy choice of target. Furthermore, “minimised” casualties could still be “excessive” relative to the concrete and definite military advantage anticipated. And international law’s clear on other topics that appear to vex Walzer too about the kind of objective that can be set against the civilian casualties; it has to be “concrete” (no messing around with intangibles like “avoiding the rocketing of New York”), “definite” (as in, with a clear chain of causation to the enemy’s ability to wage war) and “military” (no bombing objectives in order to gain political advantage).

International law’s also very clear on the subject of “negative reciprocity” – the question of whether one side’s failure to play fair releases the other side from its obligations. The answer is it doesn’t....

There’s obvious harm done in the real world by the fact that the doyen of just war theory is blowing squid ink around the relevant international humanitarian law – it makes it much easier for all sorts of people to use bad arguments to provide political cover for illegal actions – and I would be very interested in knowing whether he’s doing it on purpose or out of a lack of knowledge. “Just and Unjust Wars”... cites the Geneva Convention precisely twice (once in the preface and once on a point about uniforms not related to noncombatants). The Protocols aren’t mentioned at all....

I find that really quite freakish. Surely Walzer must have been aware that the Protocols were being negotiated, while he was writing his book? Is academic political philosophy really that disconnected from the real world? It really isn’t that difficult to get oneself involved in a debate of this sort, if one’s got any sort of professional standing and surely a professor of ethics would be able to. What am I missing here?... [W]hen Walzer sternly admonishes:

Asking the hard questions and worrying about the right answers—these are the moral obligations of commentators and critics, who are supposed to enlighten us about the moral obligations of soldiers. There hasn’t been much enlightenment these last days.

then he really needs to pull the stick out of his $%^. The Geneva Conventions were for the most part drawn up by lawyers and soldiers, and it really is unseemly for Walzer to go about patting himself on the back (and high-fiving his mates over “the triumph of just war theory”, odds bodkins) for being the only person morally serious enough to think about these ever so difficult questions, while reinventing the wheel, badly.

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