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Transcript
Rob Johnson:
I’m here today with Gillian Tett. She is a board member in the governing board of the Institute for New Economic Thinking. She has been a mentor to me as the leader of this process, and I’ll come to that in a little bit, and she chairs the Editorial Board of the United States for The Financial Times. She’s been a many-time award winner, has written all kinds of books. I remember around the time of the great financial crisis and even before that, when you wrote a book about Japan, coming out of the Japanese crisis, and all I can say is, every time you’ve written a book, the silo effect during the time when I’ve been working on… Every time you’ve written a book, I’ve learned a tremendous amount, and I even have to admit to sometimes being impatient because you’ve taught me so much, I’m longing for your next vision or book.
And today I can be satisfied in the sense that, we have a book that’s forthcoming shortly. It’s from Avid Reader Press, I believe. It’s called Anthro-Vision: A New Way to See in Business and Life. And I think this is just what the doctor ordered. Gillian is someone who, when we first started INET, said to me, “Rob, if you want to do this right, what you have to do is study the silences, because when you see the road map of the silences, you’ll know where power is and you’ll know what you have to change.” With our interest in finance at that time and this notion of reflexivity through the writings of George Soule, she turned me on to some fantastic writings by the sociologist Pierre Bourdieu.
Rob Johnson:
In particular, there was one called In Other Words: Essays Towards the Reflexive Sociology, and I thought that the epigraph that started that book was germane to this conversation that I have today. “The spirit of the castle is in the drawbridge,” said the French writer, Rene Char. Well, Gillian, your new book has a very, very powerful epigraph at the beginning and I’m going to change the wording a little bit. “The wise woman doesn’t give the right answers. She poses the right questions.” Claude Lévi-Strauss. That’s what I think you’re doing with this book and that’s why I’m so excited to have this conversation with you. Thanks for joining me.
Gillian Tett:
Well, thank you very much indeed for having me on, and I just start by saluting what INET has done over the years and what it is doing in terms of having an incredibly important and badly needed debate about where economics is coming from and where it’s going, because what’s become very clear, not just in the financial crisis but the last couple of years, that we can’t use old-fashioned narrations of economics. We needed to widen the lens, and that’s absolutely what INET is at the center of.
Rob Johnson:
So, Gillian, what inspired you to write this book? What did you see happening in the world, and what did you see happening in the world of ideas given the vantage point of being an anthropologist that inspired you to bring this anthro-vision, what you call the new AI, into our awareness?
Gillian Tett:
Well, when I say the new AI, I mean, actually, anthropology intelligence, which is I think what we really need to cope with the world where we’re all constantly dazzled by AI in the sense of artificial intelligence and big data sets and economic models, and very narrow definitions of corporate balance sheets. And what really prompted me to write this book was that over the years working as a financial journalist, talking to people in the corridor of power, people who are paid to forecast the future and design policy solutions and tell us where the economy is going, as I spoke to them over the years they often asked me about my background and I said I had a PhD in anthropology, I’m studying marriage rituals in Tajikistan. That was indeed my academic topic of investigation.
And, 15 years ago, people would roll their eyes and say, “Gosh, how cute and how irrelevant.” And then there was a financial crisis and suddenly people were forced to realize that culture and social systems mattered, and actually having a background studying those was quite useful. But there was still a sense that it was kind of supplementary to any grown-up discussion of economics and policymaking. What has happened in the last two or three years with COVID-19, with the eruption of concerns around climate change, around the racial and gender issues, around inequality, all of the social complex we’re dealing with today, what’s happened as a result of that is that suddenly people are saying, “You know, this cultural social stuff, maybe it does matter even when we think about economics and policymaking.”
And so these days I find that when people ask me why did I study anthropology, they do so not so much with scorn but interest. So, I wrote this book really to explain to them what anthropology is. It’s not just about looking at old bones in museums. Why it matters so deeply right now, what are the key elements you need to know to understand it, and why I truly believe that having what I call anthro-vision, taking the specter from anthropology is going to be one of the key steps we all need to do to try to build back better in a post-pandemic world.
Rob Johnson:
We have, I guess, a series of challenges vis-a-vis anthropology. You spoke early in the book about it being what you might call multiple shades of gray. Like it’s very nuanced. It’s very subtle. It’s not a simplistic paradigm. We’re in a very frightened time right now, as you mentioned. Pandemic, prospective climate change, social disruption related to race and gender and inequality. The social sustainability is clearly not being taken care of by the consciousness and the, what you might call, charts for sailing the ship of the world that we have created in recent past.
So, as this tradition has to change, people get frightened by what’s happening in the world. They know there’s a need for change, but then they’re also frightened about the unfamiliar. What the world calls a demagogue is often someone who preaches a false certainty or a false security, as though order can be restored. You’re talking about something where a subtle and deeper awareness, a broader awareness, which may be a necessary condition to understanding the challenge, but it may be very hard to get people to assimilate.
Gillian Tett:
Well, I think you raise a very good point there, Rob. What I’m really talking about is a shift in mindset, and what anthropology as a discipline has done over the centuries, and it is now centuries, is really a three-part process. First, it goes into places that are different from where you live, places that may seem exotic or different, and tries to immerse yourself in the mind of the other, somebody who seems alien to yourself. That’s a pretty scary step to take, because when Donald Trump, the former president, said that many countries in Africa were, I quote, “shit holes”, he was speaking with very extremist language that offended everyone, and indeed it was a very offensive comment.
But he actually also echoed a principle that is part of human nature which is, we all tend to shy away from people who seem very different from ourselves. And one of the things I argue in my book is that you have to try and be ready to immerse yourself in the minds and lives of people who are different from yourself to get a sense of broadening your mind, seeing different points of view, learning things you might not have known otherwise. That is essential in a globalized world. But you also do that because you then use the experience of soaking yourself in the mind of another to look back at yourself and get a much better sense of how you live and your blind spots, and all the things that are hidden in plain sight in your own surroundings that you normally ignore.
And in particular, that then enables you to then look at what I call social silences. Parts of your world that you simply fail to see because they’re either embarrassing, taboo, they seem boring, irrelevant. And the thing about that is that once you start looking at yourself in that way, yes, it’s scary. Yes, it’s challenging. Yes, it makes you feel uncomfortable, but it really is a way to start trying to rethink the world at a crucial pivot moment. And I also argue it’s critical to do it now given that the pandemic has kept many of us trapped in our own physical space, in our homes, in our own ghetto, if you like, and caused some of us to become trapped in our own mental space, too, and unable to rethink our assumptions.
Rob Johnson:
And, in this, how do I say, process of moving towards an anthropological vision, at some level something is dethroned. We’ll call that orthodox economics for the purpose of this conversation, and that, many people who are critical of economics act as though economics is essentially marketing for power more than it is analysis of all of the tensions, contradictions and trade-offs that we face. You had mentioned at one point in the book that the anthropology profession has often had a “anti-establishment mindset.” But they’re now being called, through you, to the stage to help us in an intractable crisis. How are we going to, what you might call, dissolve the resistance of other social scientists to the contribution that anthro-vision can make?
Gillian Tett:
Well, I think one of the tragedies is that anthropology as a discipline is sitting on a veritable gold mine of brilliant ideas which don’t get to see the light of day, most of the time, and that’s partly because people who are not anthropologists tend to scorn the discipline and think it’s irrelevant, or just about studying the exotic. And it’s not. Today anthropologists are as likely, if not more likely, to be studying Amazon warehouses and Western industrialized countries and looking at issues that used to be the preserve of economists, as they are to be studying non-Western societies or the cliched Amazon jungle.
So it’s partly because of external perceptions, but it’s also because of the fault of the anthropologists themselves in that the discipline tends to encourage people to be very good at hiding in the bushes, at making themselves invisible, at being flies on the wall, because that’s how you do your job in observing people. For the most part, the anthropologists tend to be quite anti-establishment and quite suspicious of networks of power and money. And that makes them fascinating and often very insightful, but means they’re very bad at hustling their way into the networks of power that economists tend to dominate, because economists don’t have any problems talking about money and often they don’t have any problems putting themselves on the stage or in the limelight.
And so, it’s partly a combination of personality and where the different disciplines sit in the structure of the political economy. But I truly believe that a discipline like economics would be enrichened if it absorbed more of the ideas from anthropology. I’m not saying that anthropology should replace economics, far from it. Economics is incredibly valuable, but it could be enrichened if there was a wider appreciation of other social sciences, in much the say way, by the way, that economics has been enrichened by looking at psychology and history over the years. Anthropology is the same.
Rob Johnson:
So, Gillian, do you predict that some day we’ll have the council of anthropological advisors as a department within the White House in the United States and its equivalent around the world?
Gillian Tett:
I wouldn’t expect that, to be honest. I think that would make anthropologists themselves uncomfortable. But what I’m really arguing is that you should look at anthropology as being like salt added into food in that it brings out the flavor and helps ingredients bind together. Or, to use another metaphor, using economic models of analysis is incredibly useful. It’s like using a compass to walk through a dark wood at night. You need to know what direction you’re going in, and if you have a great compass, you don’t throw it out. But if you’ve tried to walk through a wood just looking down at the dial of the compass, then you’re likely to walk into a tree or trip over a tree root.
And what anthropology does, its real power, is provide a sense of context and allows you to get lateral vision to look up from your dial and look around in a way that helps to avoid accidents and helps to put things into a wider, common sense vision. And economics desperately needs that right now because we are at a point where it’s become clear that narrow microeconomic models, which assumed that the future will be like the past, simply don’t work.
Rob Johnson:
You have a segment in the book where you talk about how anthropologists have studied… I guess it was actually an artist from Russia you alluded to, and they talked about a chart that was put up at the Museum of Modern Art related to the Amazon Echo which is the voice we know as Alexa, and how this illuminated what was happening in the process of creating this AI-like network and so-called ghost workers were represented in this art. You suggested that this kind of broadening of awareness will help us and help Amazon executives to understand the true costs and benefits of the process that they’re embarked upon.
I’m wondering, do you think that anthropologists will become part of the C-suite in corporations to help them as we, particularly, as this work that you’re doing, say at the FT, the Moral Money, with the ESG, the broader sense, the kind of work that multi-stakeholder awareness that becomes the responsibility of corporations, for the guidance and control system to make sure they’re aware of all those stakeholders? Will anthropologists play a bigger role in the future within the corporate C-suite?
Gillian Tett:
Well, Rob, you point out a great issue here which is that, in many ways, one is moved from taking a tunnel vision approach of looking at the world to making it more of a lateral vision, looking at the social and cultural context of economies and businesses and any type of economic activity, you start to get a vision of the world that’s incredibly similar to the type of vision being proposed these days by the stakeholderism movement, or sustainability movement, or the environmental social and governance movement to use that very acronym. Or, to put it another way, you start to see all the things that used to be considered as externalities in economic models like environment or the wider community, they start to get noticed.
And, I think, in many ways, the fact we’re seeing so many companies and executive and financiers now embracing ESG and sustainability, is a sign that people almost instinctively recognize that we need lateral vision today, not tunnel vision, and a sense of context. And I do think that you’re seeing corporate boards increasingly trying to use all kinds of mechanisms to get that sense of context, to get those checks and balances, to try and step out of themselves a bit to see how other people might view them and try to respond accordingly, and just be aware that if they exist in ivory towers or ghettos, they’re likely to be running risks.
So, will companies hire anthropologists? Well, yes. Some have already. Quite a lot have already done so in order to study their own customers, to work out how to better serve them. Because the reality is that customers often don’t have the same mindset as people who are trying to sell them things think they do. Some companies are hiring anthropologists to look inside themselves and see their own structures. But I think going forward there will be an attempt to harness anthropology to look at the wider context in which companies sit and how they can avoid either creating risks as a result of that, or find new opportunities.
Rob Johnson:
In the realm of education, people… I remember reading a book years ago called Dark Age Ahead by the famous writer Jane Jacobs who focused a lot on the development of cities. She was based in Toronto, and the third chapter in that book was called Education versus Credentialing. And it was based on a sense that she had that tuitions were rising, people were afraid, but what they were after was credentials in order to be able to survive in an increasingly concentrated economy where wealth and power were more concentrated.
You’re suggesting that there’s a broader type of education that is necessary to add value in this dimension of being not only aware of your customers but be aware of the ramifications of your organization. The gentleman I referred to earlier, which I learned about in your book, was Victor [Shvetsky 00:19:26] where he said that one goal of art is to make the unseen properly seen and promote defamiliarization. Should our schools be training citizens rather than input to production? And defamiliarizing people, or at least inoculating their hearts from the fears that they will be left behind in the realm of commerce?
Gillian Tett:
Well, Rob, you raise such an important issue there, which I think is going to be cutting the core of everyone who’s a parent as I am with two daughters, because the reality is that most kids entering schools today feel like they’re entering an armed race where they have to scramble breathlessly to get as many grades, qualifications, you know, chips on the counter, that will get them onto the next stage of the conveyor belt, often in a very, very narrow channel and narrow path. And in many ways it’s terrifying because we’re creating people who are assuming there’s only really one path to follow. And the reality is, we’re in such an uncertain world that the very opposite is true.
I was lucky enough to have my own education at a time when actually there wasn’t a lot of academic pressure on me or other kids my age. We worked but we also had a chance to roam and collide with the unexpected, and I roamed a lot as a teenager. I roamed physically around where I lived, I roamed across Europe in various ways, and then when I went into college, I roamed intellectually between different disciplines, I roamed in different countries. I roamed all over the place in a very, very undirected way. That enriched me enormously and is one of the key reasons I became an anthropologist, this idea of jumping out of yourself and trying to explore the other.
But I do worry that kids today just don’t have either the ability or the courage to do that, which means actually their parents don’t have the courage to let them do that. And, if nothing else, once the pandemic ends, I desperately hope that we’ll all start sending our kids around the world, physically, for exchange programs, for travel periods, for study programs, or just to travel, to just widen their mind.
Rob Johnson:
Yes. Yes. And I think that what you’re suggesting with this unsustainability of social, environmental and health systems, they can actually be major contributors to companies, to governments, and so forth, by having that broadened experience embedded in their awareness. It’s a higher calling, if you will. And I’m very interested. You talked at one point in the book about that… It had laid out five ideas, and as I listened, or as I listen to my own mind, and it was about, we’re creatures of the environment and the cultural scene, the social scene. There’s no single cultural frame. We have to immerse ourselves in the minds and lives of others developing empathy. Empathy, I think, is a core essential part of a healthy education.
And I think you said, look at the world with the lens of an outsider, aware of the other, and use the perspective to listen for the social silences. That sounded to me like curriculum reform personally. Those five pieces where I said, “I’ve got to figure out how to build the next economics text book around those five principles.”
Gillian Tett:
Well, I think you raised a great point there, and I think that kind of is a curriculum reform. If you want to boil it down, it could be encapsulated by the words, go roam, go listen, go learn. That is something which is terribly important for us to do inside schools or higher education places. But frankly, it’s terribly important for anybody who’s a professional specialist to do, because what happens, whatever education you had as a child or student, is when you get into the workplace, you increasingly get affirmed into whatever specialist discipline you’re in and you tend to climb the corporate hierarchy or the university hierarchy by doubling down on that specialism.
And you inevitably start creating pretty rigid boundaries around your world. And those boundaries can be fantastic. The discipline you’re an expert in might be absolutely brilliant, but as human beings we tend to create taxonomies and silos that reflected the world that existed 10 years ago, or 20 years ago, and when the world outside changes, we keep defending our boundaries, or the walls, of our particular silo and don’t realize how it’s changing and how we’re basically losing out on innovative ideas, or at risk of missing big dangers. So, frankly, we need to roam, whether we are six-years-old or 60-years-old, and have the courage and time to do that.
Rob Johnson:
I remember a very clever woman who is a friend of mine, wrote a book called The Silo Effect.
Gillian Tett:
Well, that was indeed my last-
Rob Johnson:
That was your previous book.
Gillian Tett:
… that was my last book. In many ways, a book-
Rob Johnson:
That’s right.
Gillian Tett:
… the new book is a kind of extension of the last book. The last book said that a huge problem, because we are all beset with silos and they’re very damaging and they cause bright people to do really stupid things. This book really says, “Well, actually, if you want to try and deal with the problem of the silos and build a better world, this is one way to do it. Learn some lessons from cultural anthropology.”
Rob Johnson:
And you talked about… I remember, because you’d written a book related to J.P. Morgan and also, before that, related to the Japanese financial crisis, and so forth, and many dimensions of the Japanese situation. But you talk about, in the book, how non-financiers view finance as a means, and that there is this, particularly after 2008, a tremendous upsurge in moral outrage because of the way in which financiers view something which you might call, not through the lens of others, almost like they’re playing a video game. And that lack of consciousness or lack of expression of consciousness, I think, was very damaging, and I’ve often thought that, while the financial crisis, it’s no longer the focus of INET’s research, though it was what I call the traumatic birth experience that led to our beginning.
The questions that were raised about expertise, about governance, that… A lot of people said to me when we started, “Well, you can figure out how to get financial theory back on track, governance back on track, and then we’ll all be back to normal.” But what instead seemed to happen was like a wild fire. Occupy Wall Street on the left, Tea Party on the right, all kinds of turmoil, discrediting of expertise in governance, it was a very interesting thing because people on the right sometimes romanticize markets. People on the left romanticize the state.
All of a sudden markets didn’t work right and the state didn’t work right, and people didn’t have a vision of social organization, which may have led to some of the despair that led to Brexit and Trump and Marie Le Pen and the AfD in Germany. And I guess we’re… I’m going on here, but, there is a tremendous amount of disorientation, and I think the, what you might call, non-social awareness of the financial sector played what I call a kick-off rule to what’s become a very broad-based crisis in faith in social structure, in organization and governance and private initiative.
Gillian Tett:
Well, I think you’re absolutely right, Rob, and I think that the fact the financial crisis really gave birth to INET is no accident, because, firstly, it was a traumatic crisis which forced everyone to rethink their attitude towards economics and financial, but it also underscored the sense of detachment that you’re talking about in terms of how many finance of a thinking, and INET was really created to try and reroute economics and finance back in the [inaudible 00:28:04] economy and society, if you like.
There’s a wonderful Spanish financial anthropologist called Daniel Beunza, who teaches at the Cass School of Business in London, who uses the phrase model-based moral disengagement, and this idea that financiers or economists armed with their models can become so caught up with peering at their model that they fail to see the consequences of what the model actually means in the real lives of people, or the context in which those models are operating.
I mean, to go back to the analogy I used about a compass in a wood at night, people are walking around peering at their compass in the dark and not noticing that they’re about to trip over a tree root, or not noticing, in a better example, people are walking around and not noticing they’re causing other people to trip over tree roots. And so, that’s really a crucial element of where I think finance and economics needs to widen the lens right now in terms of understanding the implications of what they’re doing. And that’s so true of the tech sector as well. I mean, the tech sector is a classic area which has also succumbed to television in recent years, and there needs to be an awareness of context and consequence there as well.
Rob Johnson:
Yeah. I have a home, as you know, in Northern California. There are a lot of tech brilliants all around the neighborhood, and I’m always reminded that in that neighborhood lived the poet Richard Brautigan, and Adam Curtis from the BBC named a series after a Brautigan poem called All Watched Over by Machines of Loving Grace, which was one of the fiercest critiques of a false consciousness that I’ve ever seen. I guess what I would say is, to go back to sort of classic stoic philosophy, and so, hubris tends to accumulate wherever there’s extreme success and so forth in a very short term, and that may impede consciousness. I remember Bill Janeway, one of our fellow board members at INET, talking to me about how he thought it was such an anomaly that so many people on Silicon Valley were extreme libertarians.
Adam Curtis said they named their children Ayn or Rand based on a girl or a boy. And what Bill’s concern was, was the US government was very important in the transformation to this tech world, this internet world, that places like DARPA and the NASA and so forth were the seed corn. Government was essential to the transformation, which was taken over brilliantly by the private sector, but now they act like they don’t need them, and as we approach climate change, it does seem like Seth Klein, Naomi’s older brother, has said, “We’ve got to have the good war.” The good war is the preparation for climate change modeled on war preparation, because we don’t have a choice not to address these dilemmas. But this is a very different consciousness. This would involve, whether it’s Jane Weir or Seth Klein or you or I, accepting a war for governance again.
Gillian Tett:
Well, I think that actually there is increasing acceptance of that, anyway, quite frankly. And I think that what’s happened with the race for the vaccine, is you saw a level of public-private cooperation and cooperation between companies that frankly you’ve not seen for a very long time. And, no, that hasn’t changed everything, and, yes, it’s amazing how quickly people can forget lessons from the past, but the reality is, you’ve laid down a different set of tram tracks in terms of how people imagine operating in terms of government and companies right now. And I suspect that in the coming years we’re going to see that, where it’s had, more and more.
Rob Johnson:
I think… Somebody said, going back to economics texts, the days of externalities being a footnote in chapter 37 are over. That the next edition really has to explore the scope and the scale of what Muhammad Ali’s famous poem, Me, We, the pendulum is swinging towards We, and away from Me.
Gillian Tett:
Well, I think it’s not just a question of economics having to look at the externalities in the models. I think it’s also the fact that companies, they used to look at what used to be sitting in the footnotes of their balance sheets. So you’d have a footnote to the balance sheet or you’d have a separate CSR corporate social responsibility report talking about things like the environment. And in today’s world, that basically is a large part of the model, or a large part of the balance sheet.
Rob Johnson:
And there’s probably an interesting anthropology of the insurance industry to be written, because the actuarial tables depend upon the past being prologue-
Gillian Tett:
Well-
Rob Johnson:
… and that-
Gillian Tett:
… one of the key arguments in the book is that so many of our big data sets, which, I’m saying, can be amazingly useful, are drawn on data that’s gathered in the present or the recent past, and so many of the economic models are basically constructed presuming that the past is a good guide to the future. And the answer often is, I’m not in any way meaning to undermine the usefulness of a lot of these models, but the reality is that if you don’t look at the context when the context around these models is changing fast, which it has been in the last decade, then that’s when you can no longer assume that the present or recent past is such a perfect guide to the future.
Or to use another point that economists often make when they’re looking at statistical data, correlation is not causation. You can see all kinds of clever correlations and presume they’re going to last for ever, but they’re not causation. So, if you have big data or AI sets, models, platforms based around that, they may not be as perfect as you think.
Rob Johnson:
So, if you were, how would I say? Entrusted. I go back to the book, The Best and The Brightest by David Halberstam-
Gillian Tett:
Brilliant book.
Rob Johnson:
… where we were taken by a certain form of expertise to a very dreadful place, and I’m curious how you would inoculate young people by designing a curriculum based on the vision of your book, what are the things they have to learn? I guess I’m echoing you earlier, you’ve got to take junior year abroad, somewhere, that diversity of experience. It’s not all in the book, it’s in your observation. But, what are the ingredients to this anthro-vision type of education that prepares people to be a credible and successful leader in this very complex society?
Gillian Tett:
Well, I lay it out in three parts in my book, and this is really as a guiding principle for me. The first principle is to make the strange familiar. By that I mean, to go somewhere different from yourself and really try to immerse yourself into that mindset. And you can do that by physically traveling somewhere else. You can do that by mentally traveling, by reading different things, by getting out of your own cyberghetto, whichever cyberghetto you’re in on social media. Or whatever ghetto you’re in in terms of your own media consumption. You can also do it inside institutions, and one of the benefits of having a diverse team inside institutions, or diversity inside institutions, is to try and make the strange familiar and to get exposed to different mindsets and points of view.
So the first point really is to try and embrace every opportunity you can get to make the strange familiar. And then use that to make the familiar strange. To look back at yourself and say, “How am I weird? How am I dysfunctional? What am I not seeing?” And then to look at the social silences and to think, “Okay, I’m in education. Maybe I’m an economic student. I’m getting this wonderful training in economics. What am I not studying? Am I surrounded entirely by people who think like me? How relevant is it to my world?” And to give you one tiny example, I daresay many economics students today will be sitting inside a university’s hall of residence and looking at, say, inequality, or labor market issues, and thinking lots of great thoughts about that. Have you ever stopped and thought about the nature and state of the janitors in your own university building and what that might or might not reveal about inequality?
One anthropologist actually did that and went around and did her research project studying the janitors in the university buildings. She was forced to do it because she ran out of money to go anywhere else, but then realized that out of necessity comes enormous opportunity, because literally, hidden in plain sight, was this entire community she’d never even paid any attention to before, never spoken to, never listened to, never learned from. And frankly a group like that can probably teach your average economist as much if not more about inequality and labor market economics as all the other models they might be learning in the classroom. And it doesn’t mean that one displaces the other, but they’re most powerful when combined in tandem.
Rob Johnson:
I recently read a book by a gentleman who goes by the name Patrick Lawrence, and he writes a lot about foreign policy. My focus was the United States versus China. And this book, which I think he wrote in about 2011, or 2013, in that window of time, was called Somebody Else’s Century. It was about that the Americans come from this Western Cartesian enlightenment framework, and that a whole lot of, we call Taoism, Confucianism, Buddhism and Eastern philosophy, is a very different way of looking at the world and deciding what is meaning.
Obviously, I’m not running a race between the two, but with a thing like the G20, the two sit at the same table now and they have to negotiate with each other without projecting their own philosophical framework into the mind of the person across the table from a different part of the world. How can we build those bridges which you might call dangerous of distrust, in light of climate, are very profound.
Gillian Tett:
Well, that’s a very important question because certainly, at the moment, we are dealing at a time of great distrust, and it can’t be done with a magic wand overnight. You do need to quietly and patiently try to listen. But it’s worth going back to a core point which is very important these days, and every institution needs to think about, which is, what is the basis of trust? How do we actually create trust which acts as the social glue for any group? And anthropologists seem to say, there are two distinct axes of trust, or ways to create trust. You can have vertical trust which is basically trust in a leader or institution and that works best with large groups of people.
Or you have horizontal trust which is basically peer-to-peer trust in tiny groups, i.e. I trust you because we all know each other. We’re a club. We’re a family. We’re a village. We’re a class. We’ve kind of all grown up together. I can eyeball you. So you had horizontal trust or vertical trust. What you have today is what they call distributed trust as well, which is really what happens on digital platforms when lots and lots of people put their faith in the ability to check each other out and have some kind of checks and balances through digital platforms. That’s how Uber works, that’s how Airbnb works, for example. It’s also, in some ways, how, something like Bitcoin works.
So, if you’re thinking about building trust, it’s important to recognize that you can do that on those different axes, and then ask, “Well, okay, people say today that trust in institution has collapsed,” or it has collapsed according to the surveys, but actually distributed trust is quite high. And there are mechanisms that you can do to actually build that trust. Radical transparency online is helping to build a lot more trust. Conversations are building more trust. So it’s not necessarily a brute either/or. There are different ways to adapt to the world today.
Rob Johnson:
Mm-hmm (affirmative). I had a friend… Well, still have a friend. He was in Denmark, named Vincent Hendricks, who years ago wrote a book called Infostorms, and it was about the structure of information and what could be trusted or not. I was giving a presentation in, how we say, celebration of his book and I made a slide where I showed a circular firing squad where everybody was aiming at a way that would kill everybody in the circle, and the song that I played behind it was Michael McDonald and Kenny Loggins, What a Fool Believes He Sees. “Wise man has the power to reason away.” But I think we’ve evolved a long way since that time.
Like you said, we’ve learned more about the value of trust in the context of these institutions and trying to build that affiliation and the ability to inspire, to create a way forward. I think that’s part of what your book is doing here, though I don’t know how the digital platforms interact with that, but maybe we’ll find out from this podcast. What do you think, in the scheme of leadership politics, do you sense that… I mean, I notice things like economists are not often promoted to be things like the head of the National Economic Council, or the Treasury Secretary, though Janet Yellen is, I think, off to a very good start, and she’s a PhD economist. But, have economists lost credibility, not because they did something personally unethical, but because their vision is inadequate to the challenge?
Gillian Tett:
I think that economists, at the moment, are seeing their role and place change within the government, in that for the last few decades you’ve had a very distinctive tribe of economists who often went into microeconomic models having tremendous power and influence. I used to joke that this was the Bob Rubin tribe where basically you had a distinctive school, academic network, who were very influential. And then you had, of course, the Donald Trump era, where there didn’t appear to be much interest in using experts of any sort. And what’s happened with the Biden team is that they have brought onboard economists but not your usual economists. They are increasingly turning to labor market economists, microeconomists, people who, frankly, are questioning the boundary of the economics in a way that I would embrace in my book.
And that has, understandably, caused a lot of consternation amongst many of the parts of the discipline. Some people said to me, there’s always a kind of tribal warfare going on, a tribal ousting going on between the different sides. And some people are very critical of what the Biden team is doing, precisely because they appear to be veering away from the use of economics and economists. But another way to see it is basically they’re widening the lens and trying to bring on board a more social appreciation of economics, and look at things like labor market issues, or climate issues, which were, once again, those externalities before.
Rob Johnson:
The Institute for New Economic Thinking, as you know, has a global commission chaired by Joseph Stiglitz and Michael Spence, and one of the key reports that they decided to focus on is called the Commission on Global Economic Transformation, is about the development of Africa. And it’s related to the nature of governance in Africa, the nature of the challenge of climate for an equatorial region where, how do they say, subsistence farming is very important in underdeveloped economies, and subsistence farming is at risk in the realm of climate change.
But the other dimension of this, according to the International Office of Migration, is that the population of Africa will be five billion people by 2075, and I always go back to my closest childhood friend, the late Robert Kabeary, who’s a baker, and he built ovens in places like Honduras, Lesotho and Jamaica to help people sustain themselves. And he watched me in the realm of economics and finance, and he said to me one day, “This demographic bulge and the struggle with development may lead to a huge outward migration and teach economists once and for all that people are more than just inputs to production.” I thought that was brilliant. He was thinking like you.
Gillian Tett:
Very good way of putting it, and great way of putting it. And, again, I guess, another way to see what I’m looking at is saying, is… I’m calling for intellectual checks and balances. I’m not saying that any one group of people has all the answers. I’m not saying that bakers should be put in charge of economic policymaking, but, boy, do they have a potential insight at, which is the value of diversity.
Rob Johnson:
I’m kind of grinning as I listen to you today because I remember when Arminio Fraga, who’s another INET board member, and we both worked at Soros Fund Management right after the big ERM dissolution of British pound devaluation, and a lot of young students came to Columbia University’s School of International Public Affairs, because Arminio and I taught a course called International Financial Markets and Economic Development. And I think we had a lot of fun in the course, but a lot of them, essentially, wanted career counsel. A lot of them were very enamored of finance. And one night Arminio and I sat after class, we wouldn’t talk about this during class, but we’d give what we might call meetings after class. And I remember sitting with Arminio and these students and they all wanted, essentially, to give us their resume and go to work at Soros Fund Management.
And Arminio said, “What you really need to do at this stage in your career is go to a place like Indonesia and understand it in a way that no one else can. And then, some day, a place like Soros Fund Management will understand the value of knowing what’s unfolding in a crisis in Indonesia, and they’ll come get you and they’ll pay you like a partner, not like a research assistant that basically is just running a Xerox machine.” And I think, to augment that, we were not set up at that hedge fund as a training ground nurturing long-term. It was more like the New York Yankees of those days, buying the best free agents at the time to go into battle in whatever realm where the crisis was burning.
It became the Asian crisis, the Russian crisis, and so forth, after the ERM. But this kind of learning through venturing to places, to developing knowledge that other people don’t have and being able to contribute that, I think is both healthy in a private or in a public domain type of career ambition. So I’ve been grinning as I’ve been listening to you because I felt like, “Gee, I wish I’d gotten these lessons from you when I was sitting next to Arminio. I would have increased my conviction.”
Gillian Tett:
Well, thank you very much indeed.
Rob Johnson:
Let’s talk about you, yourself. What most concerns you now, let’s say for the legacy that we’re handing to our children? What do you see as most intractable? And, through the anthro-vision, how do we address that challenge?
Gillian Tett:
Well, the legacy that’s most immediate, obviously, is climate change. That is a serious legacy which is requiring serious action and it’s unclear whether we’re going to have the will to actually take the action we need to protect and preserve the planet. But aside from that, the question of inequality, because COVID-19 has really exacerbated inequalities in a very cruel way, and when coupled with the extraordinary tech transformation, we could be sliding towards a world that’s increasingly unequal, where the younger generation feels they don’t have much of a stake in preserving socials, harmony and stability, where they essentially feel like they’re screwed. And that will be a recipe for growing tension and conflict.
So, I’m very concerned about the future right now. I hope that one lesson we’ll learn from the pandemic is for economic reset and a mental reset, and we try and move towards a more collaborative world, embrace what I call anthro-vision. But if we don’t, then I think the future’s pretty dark. It’s worth remembering that after you had the pandemic you had the Roaring Twenties. Everyone thought, “Great. Wonderful. Back to normal.” You had a stock market boom, dramatic stock market boom that went bust. And then that, of course, ushered in a Great Depression, and then war. And it’s not impossible to see the kind of patterns we’re seeing play out right now leading towards a lot more conflict in the future.
Rob Johnson:
Mm-hmm (affirmative). Well, I’ll add to that my own concern, and it comes from having been an MIT undergraduate where I had focused in my junior and senior year on arms control and disarmament. And in recent months I’ve gotten to know the former whistleblower at the time of Vietnam, Daniel Ellsberg, and talking about his book, The Doomsday Machine, where the prospect of what they call a nuclear winter, it’s hideous if there is an exchange of nuclear weapons of the deaths around the cities.
But what is now published in places like Nature and Science magazine is that there is another effect which is that the upper atmosphere gets destroyed, it creates an ice age on planet earth and under those scenarios would end the lives of 95% of the people on this planet. And that so-called nuclear winter, as I’m listening to you, we’ve always had this mutual assured destruction deterrents kind of logic, but as you’re talking about a disintegrating social system and the stresses of climate, the risk that those dysfunctions spill over into the launch of nuclear weapons goes up. So I think we also need a very, very profound reduction in the stock of nuclear weapons. Not necessarily go to zero, but go to the place where we’re no longer under the threat of that nuclear winter.
Gillian Tett:
Well, I think, you certainly make a great point. But I’d also say, just to be a bit more cheerful, I’ve made two points. Firstly, the vaccine scramble was initially very depressing, but actually ended up being not so depressing because you did get collaboration between companies and governments and companies around the world. People used the magical power of the internet to connect us all to swap ideas scientifically at a speed we’d never seen before.
Yes, there are fights about patents and production. Yes, there is extreme, gross inequity between the way that different countries are getting access to vaccines and the other ones are not. And yet, even that, the fact you can use digital transparency today to illuminate these kinds of inequities is also creating political pressure for more distribution and more change. So, I wouldn’t be so despairing, and I’d also point out that, actually, the fact that companies and policy leaders and even economists and others are embracing sustainability in ESG again is a sign of people trying to take a more lateral vision and a wider, dare I say it, anthro-vision approach to life.
Rob Johnson:
The final thoughts. I sit and I look at all of this tension and this distress, and I look at someone at a perch like The Financial Times, who influences many of the people who have the kind of consciousness that you’ve criticized in their formative years or what have you, and yet you can reach them and you’re not afraid of them. You become a guiding light. You illuminate the possibilities, and I often, as you know, think in terms of music, and the song that came to mind as I was reading your book and as I listen to you, is by Van Morrison, and it’s called The Healing Has Begun.
Gillian Tett:
Oh, thank you. That’s incredibly kind of you, and let’s hope that the optimistic scenario is one that’s going to play out, and that the vaccine search will be a good metaphor for both the terrible problems besetting our world, but also the fact that sometimes people can try to find solutions and make progress.
Rob Johnson:
Yeah, there’s a philosopher from Hungary named Ervin László who’s recently written a book called, Making A Better World. He’s in his 80s now, and I believe he wrote three books during 2020, and it’s envisioning this broader-based inclusive world. It resonates with your text. But I’m going to find where he is, locate him, and make sure that he sees your book, because I think you’re not just saying there is a need for it. You’re looking at existing disciplines, existing bodies of knowledge, and asking us to wake up to that.
Gillian Tett:
Which, of course, is what INET was founded to do.
Rob Johnson:
That’s what… I’m glad you’re here.
Gillian Tett:
Thank you.
Rob Johnson:
Thanks for being here today-
Gillian Tett:
Thank you.
Rob Johnson:
… and thank you for writing this book, and thank you for the leadership that you present to this world.
Gillian Tett:
And thank you for all the work you’ve done with INET and for what INET is doing. So, thank you.
Rob Johnson:
We’ll talk again soon. And check out more from the Institute for New Economic Thinking at ineteconomics.org.
