David Boyle's Blog, page 78

CQC, the bargain basement counting warehouse

I have mentioned before, rather too often for my own comfort, that the coalition missed a political trick by failing to articulate the absolute failure of New Labour's regime to control and manage public services.

Yes, they talked about the failures of central targets, but that was all. They did not join the dots and explain the core of the muddle they had inherited, as they could have done - perhaps because they had not quite grasped it themselves. Perhaps also because they were still half in the same mindset.

A few months into the new government in 2010, I asked a senior civil servant at the Department of Communities how they could square abolishing targets with embracing payment-by-results (really just targets with money attached) and just got blank faces.

I was reminded of this by the story about the goings-on at the Care Quality Commission (CQC), because I can't do better than the analysis by the influential NHS blogger Roy Lilley this morning:

"It is not honest to say central regulation works. It self evidently doesn't."

So, the real issue for me is not what should happen to the CQC managers who shredded a damning report, but why these catastrophic failures happen in the regulatory control regime the coalition inherited so innocently from New Labour, and which they haven't seen clearly enough to unravel.

Because New Labour was infected beyond any other government with the utilitarian fantasy that regulation was a matter of counting things.  It assumed that every public service was simply a version of an assembly line and could be tackled by standardising responses, and tuning the people involved into regulated machines.

So every time the system tightened up, the chances of the brilliant human beings in the front line to make things happen were that much more constrained. It has been a tragic tale of reduced effectiveness bought in the name of efficiency – and it isn’t over yet.

There was even a room at the Department for Education where you could stand surrounded by the data that poured in from schools around the country, and feel yourself at the controls of a giant education machine.

Nowhere in government was the fantasy of control as strong as it was there, as civil servants and ministers could sit there and feel they were looking at the dashboard of UK education. It was only when you got into real classrooms that the depth of this fantasy was obvious.

A friend of mine was a teaching assistant whose teacher, also an Ofsted inspector, spent much of the week in the stationery cupboard because she could no longer cope with the class. Yet the school was moving up the league tables.

The truth is that Frederick Taylor and Henry Ford's systems, applied to regulation in the UK, only seemed to increase efficiency.  It was a fantasy cheered on by the huge compliance industry, that helps companies measure their way to compliance with international legislation, but which fosters a peculiar obsession with figures at the expense of what is actually happening.  As the systems thinker John Seddon says, targets make organisations less effective and more expensive.

It was a fantasy of management like a giant machine, checking that the processes were followed, and believing the numbers that emerged.  This was what was responsible for the care failures being debated today, which led to the controversial shreded report.

CQC is a staggeringly dysfunctional organisation, a bargain basement counting warehouse, without insight or intuition, far too big to do more than count the numbers that pour in by fax (and yes, until recently, most of their care home returns were organised by fax).

It was designed by a government which believed that service regulation was all about minding the vast humming machine.  Its predictable failure should not mean that we all scurry about working out how to replace one kind of dysfunctional central control with another - but work out how we can hold services to account better locally.

You can find out what this means in practice in my book The Human Element.  But it is going to mean more people, more judgement and a great deal less counting.  But it will also mean a different style of control inside those services so that they might begin to claw back the effectiveness they lost during those utilitarian years of fantasy.

Why Krugman got it wrong on the Luddites

It is always rather a dangerous business appealing to the Luddites.  They got a bad press two centuries ago and they get a bad press now.  They remain the byword for people who, as we used to say in the 1970s, "stand in the way of progress" - who cling to stage coaches in an age of rockets.

But the legendary liberal economist Paul Krugman appeals to them bravely and rightly in a column for the New York Times (and thank you Amanda @briesias for pointing it out or I would have missed it).

And I was glad he did, because he backed the thesis in my new book Broke: Who Killed the Middle Classes.  The economy is entering a new phase, and it doesn't look good for the middle classes - especially as knowledge work is increasingly being automated.

Of course, what Krugman means by the 'middle classes' is rather different - he means blue collar workers, and there is nothing controversial about their economic plight.  No argument.

These are also global trends that threaten to destroy the livelihoods of graduates, leaving behind a shrinking elite and a huge proletariat - and I've tended to concentrate on avoidable UK trends so far.  But he is right that there is a problem.

Today's edition of Today had a series of items that put this at the top of the agenda - from the frustration of the new middle classes in Latin America to the 20 per cent rise in rents in the UK over five years (based on house prices).

He's also right that the Industrial Revolution did, in fact, uproot and destroy the lives and livelihoods of generations of the first English industrial workers.  It took those generations for the rewards of the Industrial Revolution to raise the living standards more widely.

So, he says, we need an effective safety net.  I'm sure we do, but that isn't a solution.

It is a nervous moment before disagreeing fundamentally with Krugman.  Many people don't survive the experience - but he's wrong.  He's wrong for the following reasons:
A springier, more effective safety net, is not going to halt the shift in power and resources to the very rich.  We need to tackle the inefficient structures of business which allow a small elite to capture all the benefits.  Our business structures are still industrial age ones and they urgently need reform.  Call it pre-distribution if you like; we need it.Krugman assumes that the IT revolution we are seeing now will be a repeat of the Industrial Revolution then, and that eventually, painfully, the rewards will be spread.  There is really no evidence that history will repeat itself in this way - quite the reverse in fact.  It required major anti-trust legislation to prevent the enrichment of a tiny elite last time, and it will require the same all over again.There are a whole range of knowledge processes which are not amenable to virtualisation - and they are the preserve of professionals: doctors and teachers can benefit from IT enormously, but we will all be poorer if they are replaced by it.  Some professions require human relationships to make them effective.So there is hope for the middle classes, however defined - but not from weaving themselves a new, improved, glorified safety net for them to live in.
They are going to have to build a political force capable of clawing back power and wealth from the new elite, and to defend the middle class life.
They are also going to have to patrol and defend their own front line.  If they accept that teaching and doctoring can be digitised, and all the other professions that require relationships to be effective, they will be helping to usher in an age of ineffectiveness.
That is bad enough - but they will also be undermining their own last bastion.

Taking back pre-distribution from Labour

Some years ago, I wrote an essay for an excellent book of counterfactuals, edited by the equally excellent Duncan Brack, trying to explain why it was the the British Left had moved away from the kind of co-operative culture that was embraced in Scandinavia.

I imagined the difference was because Beatrice Webb failed to marry Joseph Chamberlain, as she had hoped, and turned away from Liberal co-operatives as a solution in favour of dour state Fabianism.

The only review I got was from the left wing Tribune, which called it "an insult to everyone involved".

Possibly it was.  But the basic message was important.  Something shifted the direction of UK reform in the wrong direction, with disastrous results - because the whole business of reform has to be fought for now all over again.

A century ago, the two sides were still slugging it out.  The New Age was battling with the Fabian New Statesman week by week for a more all-embracing radicalism.  Unfortunately, the two papers merged and the Fabians ended up on top.

So it was that Labour, and to some extent Liberal, policy was governed by an approach that left the basic structures of business intact, but then tried to redistribute a bit afterwards using the tax system.

As a result, successive Labour governments took office convinced of the need to change nothing, but to fiddle a lot with tax codes and tax credits and benefits.  The staggering wealth of the new elite, and the inflationary pressure that brings on the rest of us, is testament to their failure.

I mention all this because the American commentator Jacob Hacker has been in town at events organised by the Policy Network, about the term he coined 'predistribution'.  This is what he said in the Guardian:

"Finance was at the heart of the crisis and is at the heart of rising inequality, and policies should be retooled to foster long-term investments in entrepreneurship and innovation, not quick profits based on volume, leverage, or insider knowledge."

Predistribution is never going to take off as a slogan, but as a guideline for policy-makers it is extremely important.  For the first time in a century, it allows us to escape the dead hand of Fabianism and re-visit those radical ideas that even the Liberals lost faith in during the Edwardian era - co-ops, local institutions, and re-organising business so that the rewards spread more evenly and more efficiently.

It cannot be efficient, for example, for investors to buy a lifetime interest in their investments when they are only actually interested in 25 years.

So I hope that Liberals will embrace redistribution, but make it distinctively Liberal.  Because, with the best will in the world, we can't rely on the Labour Party to do more than gargle with the word and leave everything exactly as it always was.

And remember, if you doubt it, what Beatrice Webb's inspiration was by the end.  "Some old ladies fall in love with their chauffeur; I have fallen in love with Soviet communism", she said in 1944, during the great years of Josef Stalin.

Beatrice Webb's love life has a lot to answer for.

What's missing from the Lib Dem Million Jobs campaign

The Lib Dem Million Jobs campaign is well and truly launched, and my in-box is weighed down by homilies from Vince Cable and Nick Clegg about its importance - putting jobs right at the heart of the Lib Dem effort in the coalition.

It is a brave and powerful campaign, and it is about precisely what the party ought to be campaigning about. Regular readers of this blog (if there are any) may remember that I gargled with David Lloyd George's 1929 slogan 'We Can Conquer Unemployment'.

For all the Lib Dem rhetoric about fairness and civil liberties, the party has to make bold economic claims if they are going to hold together some kind of purpose which will strike a chord with voters.

That's what I said, and - although I doubt very much whether anybody read by blog before coming up with the new campaign - that is what I meant.

There is also a good story to tell.  There is huge effort from the Lib Dem side of the coalition going into making jobs happen, from the apprenticeships to the Green Investment Bank, and it is having an effect.

But there has been some scepticism about the campaign in the Lib Dem blogosphere (I can't believe it: I have reduced myself to using a word like 'blogosphere').  Jonathan Calder quoted my blog about blocking the RBS sell-off until it can be turned into a useful lending infrastructure, as a more distinctively Liberal approach to economics.

Actually, I don't think the two are mutually exclusive.  Yet there is something missing here.  Something very important.  It is the missing implication of what people ought to do about it.

By itself, the list of Lib Dem policy successes reads a little like Harold Wilson's 'white heat of technological revolution'; it carries the same dated whiff of naivety.  And of course there is a great deal about grants and clever ideas to encourage companies to take on staff.

These are all worthy and important achievements, but why do they imply that anyone should back the Lib Dems because of them?

Any political party can give out grants and come up with clever ideas to tweak the company tax code.  They can and they do.  Most political parties will claim an interest in rising employment and will stake a claim to any successes going.  Why vote Lib Dem?  What is the public reaction supposed to be to the Million Jobs campaign?

Because if it is public gratitude, then don't hold your breath.  People are not grateful to political parties.  They don't vote for them because they had some clever ideas in the past.  They vote for them because they believe they have the answer to the future, and have the capacity and will to make it happen.

That is the crucial missing element in the campaign.  If we can conquer unemployment, we have to articulate a new approach - that goes beyond the Million Jobs and explains why we uniquely have the answer.  That is what Lloyd George claimed with that slogan in 1929, and - although it was not adopted by the British government - it was adopted by Roosevelt in the USA as the New Deal.

Can the Lib Dems conjure up an approach to economic recovery as fundamental as Keynesian economics?  Perhaps not overnight, but the basic outlines are clear:
An asset-based approach to local revitalisation, based on effective local lending, maximising local money flows, plugging the leaks in the local economy with new enterprise, and making local spending go further (see for example my report Ten Steps to Save the Cities.)An approach to recovery that understands we need local institutions, to lend to and to support new enterprises (see for example the first sections of the recent Lib Dem policy document on sustainable jobs).Labour thinking is veering towards regional banking but they do not yet see the central truth - that every area has the basic resources it needs to recover (at least to begin to recover), if only it had the right institutions to make it possible.

Come and discuss the plight of the middle classes with me

The publicity about my book Broke: Who Killed the Middle Classes seems to be continuing.  Fingers crossed that people are actually reading it.  But it is an important debate about the future of our society, and whether we are hurtling towards a new semi-feudalism - and talking about the middle class is always fun.

So do come and join in the conversation.  I'm speaking about the book at the following events:

The Centre for Local Economic Strategies summit in Manchester (27 June) - actually that is mainly about local economics, but I'm happy to talk about the middle classes too.

Ways With Words at Dartington (8 July at 1pm).

Whitechapel Gallery (26 July at 12.30pm)

Edinburgh Book Festival (19 August at 4pm) with Richard Brooks

Whitechapel Gallery (30 August at 12.30pm) panel discussion.

Soho Literary Festival (27 September at 4pm, this is the correct date) with Harriet Sergeant, Henry Hitchings and Owen Jones.

I should also be at the Chiswick Book Festival but I'm waiting to confirm this.

Some of these are liable to be explosive.  All of them are going to be fun, especially when we start talking about the innermost fears of the middle classes to audiences of the middle classes....

Why are fairies making a comeback?

It seems inappropriate somehow in a serious political blog (well, relatively serious) to talk about fairies, but that is what I'm going to do. My reason for doing so will become clear, but the hook is the report in the last edition of Countryfile about Elizabeth-Jane Baldry's amazing fairy feature films shot in and around Chagford (see clip, from 31.20).

But fairies are having rather a comeback these days.  There are fairy events all over the UK, and especially now in the USA.  Huge fairy exhibitions, Susannah Clarke's novels and goodness knows what else.  There is an event coming up in Cornwall next week.

Something is in the air. Just when you thought it was safe at the bottom of the garden – when the whole notion of the ‘little people’ had been consigned to effete affectation – the idea of fairies seems to be making a comeback. What is going on?

Some years ago, I tried to track down the Fairy Investigation Society, founded by Sir Quentin Craufurd in the 1920s, and designed to promote serious study. Over the years, it managed to attract a number of prominent supporters, including Walt Disney and the Battle of Britain supremo Air Chief Marshal Lord Dowding, whose career was not helped by his public expressions of belief.

But by the 1970s, the Society could stand the cynical public climate no longer and it went underground. I wrote to their last known address outside Dublin, when I was first interested in these things, and had a strange letter back. It was from a man claiming that he knew the society’s secretary, but he said he didn’t want to talk to anybody. 
Not only the fairies had disappeared, but the fairy researchers seemed to have fled as well.

So why are they staging a comeback? Partly I think because they are an antidote to Tesco and the Public Sector Borrowing Requirement. There does seem to be something about fairies which not only recognises the mystery, hidden life and sheer magic of woods, forests and the natural world, but which also flies in the face of brute fact.
Partly because, as Brian Froude said on the Countryfile clip, they are the spiritual personification of natural processes.  I could go for that, natural features seem from different dimensions.  Certainly I prefer to live in a world where there are parallel ways of looking at reality, just as there are shades of opinion, than the miserable cut-and-dried utilitarian world I seem to have been born into.

Will this admission help my career in the world of think-tanks and politics? Almost certainly not. But, when all is said and done, we do need to stand up for a bit of magic.

“A man can’t always do as he likes,” said John Ruskin in his Slade lecture ‘Fairyland’ in 1893, “but he can always fancy what he likes.” One of the problems for 20th century audiences was, of course, that Ruskin did rather fancy fairies – or at least their human equivalent. But let’s leave that on one side. The point is that fairies were for him, and maybe also for us, an antidote to grim reality.

All of which is a way of saying that my own novel about fairies Leaves the World to Darkness (it's for grown-ups; there is sex in it) is now published as an ebook by Endeavour Press.
It is my small contribution to undermining the utilitarian consensus.

Why the Lib Dems need to block the RBS sell-off

I don’t feel that sorry for outgoing RBS boss Stephen Hester. Nobody with a licence to extract money from the economy – in this case for severance package worth £5.8m – really deserves much sympathy.

But he has had an impossible job. Does he follow the regulators' demands (reserves) or the Treasury’s demands (profits leading to early privatisation)? Or does he follow the political imperative (lending to small business)?

In fact, of course, the infrastructure making small business lending possible has been dismantled long ago, so that is impossible, but he can’t admit that in public – any more than his fellow bank CEOs, all with their own licences to extract money from the economy.

In practice, Hester has tried to do all three and so has displeased his masters at the Treasury. But what is really unacceptable is that the Treasury’s instructions have not been about facilitating recovery at all – how otherwise can we explain that small business lending has been lower for the banks in public ownership than the rest? It has been about early privatisation.

Nobody would have welcomed the 2008 banking collapse. But given that we ended up taking RBS into public ownership, it would be a tragedy if it was returned to the market in the same dysfunctional structure that it was in before.

Britain is crying out for a small banking infrastructure like our competitors. The unbalanced state of the economy demands it.  The coalition agreement promises to "foster diversity, promote mutuals and create a more competitive banking industry". How can the coalition justify returning the RBS monolith to the market without making it a useful and effective supporter of business recovery again?
The Commission for Banking Standards report is published today and will recommend breaking it up - though it isn't clear as I write what this means, and how far the report leans towards the Archbishop of Canterbury's view that the break-up must be into more useful regional banks.
The Treasury can go ahead with a sell-off and ignore the Commission if it wants to, but it can't ignore the Lib Dem half of the coalition.  It seems to me a clear cut case for the Lib Dems here: vetoing early privatisation until RBS can be returned to the market as a useful and effective lending infrastructure, which it manifestly isn't at the moment.
That alone would justify the party's involvement in the coalition.  The prize could not be more important: providing the UK with an effective lender to expanding business which is so urgently needs.

Choice works, so why not in legal aid?

This blog post is cross-posted from Lib Dem Voice: http://www.libdemvoice.org/choice-works-so-why-not-in-legal-aid-34893.html

Choice is a funny thing. I spent seven months studying how it worked in practice when I was running the Barriers to Choice Review for the Cabinet Office.

Despite the rhetoric from parts of the left, I believe that people can improve public services by being able to choose between different providers.

I’m also only too aware how many people are excluded from that – by a lack of information or advice, by a lack of transport and any number of other factors.

I am also aware of the political confusion around the term, when words like choice, competition and co-production, are often used interchangeably. As service users know very well, there are times when choice and competition are aligned, but there are also times when they cancel each other out.

This is so, for example, when the actual choice is made, not by patients, but by service commissioners choosing between two alternative candidates for block contracts. Or when the weight of demand is such – as it is for some popular schools or GP surgeries – that the choice is made by the institution, not by the user. In both cases, there is competition, but no user choice

But the basic concept is right. Nobody should have to put up with poor or patronising service - and people’s ability to choose does give the poor or marginalised the right to say no, and go elsewhere.

I also believe in the underlying purpose of choice in public services. It puts pressure on managers to be aware of what people want. It reminds staff that services are not designed for the convenience of professionals.

The systems set up over the past decade or so miss out a great deal, but holding the basic price steady, and letting service users choose, can improve services.

The evidence can be ambiguous on this point, but the basic argument is widely accepted inside and outside government – giving people some choice between providers is a safeguard for service quality and it often improves it.

But there is a peculiarity at the heart of this. It may even be a stark contradiction.

For some reason, successive governments which believe these things suddenly stop believing them when it comes to services for poor or desperate people.

Some services directed at the at the most disadvantaged people are notable by their almost complete absence of choice. If choice encourages responsibility, flexibility and better success rates in other areas of public services, then it is probably time some element of choice of providers was introduced also in drug and alcohol rehabilitation services, and in employment services.

None of these services are intended to be punishments – they are there to support people back to work or out of addictions – and they would benefit from the same kind of choices that users enjoy in other services.

Which brings us to the proposed changes to legal aid. If choice improves services in the health and education sector, and underpins the rights of individuals not to put up with careless or uncaring professionals, why does the same not apply to legal aid?

The proposed changes take choice away from individuals, and hand it over to the commissioners - the precise reverse of policy in social care, health and education.
Unfortunately, the Justice Department seems to have fallen for one of the other great mistakes of successive governments – that economies of scale will make services more efficient.

There is no evidence for this at all. What evidence there is suggests that where there are big providers, which owe nothing to the individuals they are supposed to be helping, then the diseconomies of scale – the small inefficiencies and miscarriages – very rapidly overtake the economies.

We will see. But I suspect the plans will not just decrease choice, they will also increase costs.

How to tell useful IT projects from useless ones

I’ve spent the last two days in a couple of seminars at the European Commission in Brussels about the future of work, and it was fascinating. I was there to talk about time banks across Europe and how they are developing, but I also heard about the developments in crowdfunding, crowdsourcing, micro-finance and online volunteering.

All this is developing extremely fast, and it was good to chat to Wingham Rowan, the founder of Slivers of Time – the website that allows people to work very flexibly for a few hours a week, when they can.

In this case, incidentally, they have been frustrated by benefit rules that want people either to be in jobs or not, but hopefully this conundrum can be broken by the new universal credit, which positively encourages people to work where and when they can.

It took a little while to strip away the heroic West Coast rhetoric about the internet being a brave new world, and to realise that – in nearly all these cases – they are making possible local interactions which had become too difficult before.

People wanting to work flexibly. People who want to raise local finance from friends and family for a business idea (and in practice crowdfunding usually is from friends and family). People who want to use their life skills to help out in a local health centre. All these are made possible by these innovations.

What they are not is internet-driven disappearances into virtual reality, where nobody meets. They enhance geography, they don’t try to make it irrelevant.

This is the truth about the internet, when it is used effectively. It can’t in the end subsume human needs for real face-to-face connection – that is a California fantasy. But it can make possible local institutions which had become impossible before.

In lots of ways, the internet brings back a world where a man in a van delivers groceries to your door (as they used to deliver to my grandparents’ door - Mr Botting, he was called).

It brings back a world where local people could pool local savings to create a friendly society to provide themselves with revolving loans.

Or it does potentially. We are not there yet on any scale.

And what gets in the way, apart from the wrong kind of regulation – or officials who want to describe and circumscribe precisely what these innovations are, so that they stop innovating – is the rhetoric of virtualisation.

It all goes wrong where the internet mega-corps think you can somehow measure digitally and replace vital human components like trust or love.  When they believe they can digitise human skills, and pretend that the complexity and care with which we deal with each other as human beings is somehow irrelevant.  
When public services fall for this stuff, the result is services which don't work very well - or which don't work for any non-standard cases which, as the systems thinker John Seddon points out, simply locks in costs.

So I feel a little justified in my continuing scepticism by my visit to Brussels, and finding that - where these internet innovations really work - it is by making local institutions possible, where people are more able to meet or work together.
So, for me, it is social innovation plus technology that matters. Not thinking machines that are supposed to keep an eye out for lonely old people – would you want to replace human interaction with a thinking machine? 
Instead, we have technology making it possible to gather money and people to that they can do something effective again.

You will get bizarre side-effects of this stuff. Online programmers in Bangalore mending your computer in Brighton, but that si just back-office work.  Or, more worryingly, Chinese factories paying semi-slave rates to do online gaming – creating online ‘gold’ that can be sold to rich American gamers (there are supposed to be 400,000 of these, and that was years ago, doing what is known as 'gold-farming').
But don't let's pretend this is a whole new work paradigm/  And don’t ever forget, the internet works most effectively when it makes real life, real geographical life, better – and begins, by the way, to replace our lost local financial institutions.

Toward the Setting Sun available briefly for free

It is no great secret that what I most want to do in life is write history books.  I've written about Richard the Lionheart's journey in disguise, about the strange hidden history of money, and I'm finishing a short ebook about the submarine passage of the Dardanelles in 1915.

Where someone like me can find a new angle on old stories, it seems to me, is by putting familiar stories in context.  When I published a book about the 'discovery' of America in the USA five years ago, that's what I did.

Who remembers, after all, that Columbus, Cabot and Vespucci were making their amazing voyages during the hegemony of the Borgias, while Leonardo and Michelangelo were at their height (Leonardo knew both Vespucci and Cabot), and during the brief reign of Savonarola - not to mention the rebellion of Perkin Warbeck, which nearly prevented Cabot's voyage in the first place.

When you do that, you find that the three great explorers all knew each other and were deeply involved in each other's lives.  It may be that Cabot began by working with the Columbus brothers.  We don't know.

But I'm glad to say that my book Toward the Setting Sun: Columbus, Cabot, Vespucci and the Race for America is now available in the UK as an ebook published by Endeavour Press.

In fact, for the next three days, the ebook is downloadable for free from this link:

http://www.amazon.co.uk/Toward-Setting-Sun-Columbus-ebook/dp/B00CP6VL2S/ref=sr_1_2?s=books&ie=UTF8&qid=1370942809&sr=1-2&keywords=boyle+toward+setting+sun