Reprogramming the future
Our entire social system is in need of renewal. If progressive institutions such as the RSA, which seek to improve society and advocate reform, are to rise to this challenge, they must create a model of change that balances state, market and civil society.
By Matthew Taylor, Chief Executive of the RSA
The greatest question of our time is perhaps whether the change wrought by technology will benefit humanity as a whole. For progressives, technological advance provides an opportunity to develop a much-needed story of hope. But to be credible as inheritors of the future, they must first show their willingness and ability to grasp the scale of the challenge society now faces.
The complex structure of a broadly liberal society such as Britain’s rests on three pillars. First, welfare, comprising transfer payments, public services and security, but also the wider responsibility of the state to maintain social cohesion. Second, the modern marketplace, comprising elements such as property rights, competition between businesses and consumer culture. Third, the democratic pillar, comprising elements such as contested and fair elections, freedom of speech and assembly, and the rule of law. All three pillars have been battered in recent times.
The first to be systematically assailed in the modern era was the welfare state. Based on longstanding ideas, and especially the work of economist Friedrich Hayek, a set of thinkers sometimes grouped under the name ‘the New Right’ rose to prominence in the 1970s and 1980s. They shaped the reforming policies of Ronald Reagan and Margaret Thatcher and have continued ever since to be an influential strand of ideology and public discourse. The New Right were ostensibly champions of the free market, but rather than extolling the virtues of enterprise, they focused on seeking to demonstrate the structural failings and poor outcomes of welfare systems. Public choice theorists such as Mancur Olson and James M Buchanan argued that politicians and state bureaucrats were bound to maximise their own interests rather than act as the impartial guardians of social progress. Followers of economist Milton Friedman argued that state spending crowded out private investment and enterprise. Other research and commentary argued that welfare was generating malign consequences. The narrative blamed the state for dependency, voluntary unemployment and family breakdown.
But critiques of public services have not been restricted to the political right. Progressive commentators and community activists have complained about the bureaucratic, even inhumane nature of welfare rules and service silos. They have similarly bemoaned the focus on the consequences of social problems rather than their causes. To use a metaphor popular in the 1990s ‘we need fewer ambulances at the bottom of the cliff but more fences at the top’. In Britain today, the failings of welfare and public services are more likely to be put down to austerity than the intrinsic weaknesses of state provision, but the basis of the deeper critique persists.
The apparent backlash against the second pillar, market economies, has been a more recent phenomenon, but with a long intellectual history. Critiques of capitalism are as old as capitalism itself. Schumpeter, Veblen and Keynes, and of course Marx, recognised the strengths of capitalism, but also its structural frailties. Yet the widespread revival of these ideas has only come about in the last decade. The 2008 credit crunch and its consequences provide the current momentum for public disenchantment with financial capitalism. According to a recent survey, less than half of people think British business behaves ethically. The conditions for this disenchantment were created by the banks and their champions in as far as they caused the crisis, the fact that no one was punished, the decade-long stagnation of living standards for most people in most developed countries and the steady drip of stories of corporate misbehaviour.
The third pillar, democracy, has like capitalism always had its critics. But, again, a number of current factors have combined to increase the volume of detractors. Democratic institutions and the politicians who occupy them have become even less trusted and more unpopular than usual, something reflecting both the failure of leadership and policy, and a succession of exposés of misbehaviour. Democracies have also generated outcomes — particularly Trump and Brexit — which seem to go beyond the normal swings of party politics into acts of collective self-harm. Finally, the capacity of Putin’s Russia to get away with aggression, dishonesty and sabotage and, more profoundly, the economic performance and apparent political effectiveness of Chinese leadership, have led more people to question whether representative democracy really is the most resilient basis for either political authority or social progress in the 21st century.
This state of disenchantment is not just unhappy, but could be catastrophic. Because, despite all the negativity we direct at the status quo in countries such as ours, there is as yet no viable or popular alternative to these systems in their current form. It could be said of democracy, the welfare state and financial capitalism that ‘we can’t live with them, but we can’t live without them’. Unless we can renew the dominant systems of the western world, their failings and our disillusionment could drive us into making even more profound mistakes than the ones we and our leaders have already committed.
Four ways of coordinating human activity
In developing a programme of reform we must try to think more deeply about this system as a whole. I have written before about an approach (based on the work of anthropologist Mary Douglas and her followers) that views societies, and systems within those societies, through the prism of four ways of coordinating all human activity: three active and one passive. The active forms are ‘the hierarchical’, ‘the solidaristic’ and ‘the individualistic’. Each of these forms of coordination is complex and ubiquitous and each is reflected in everything from our day-to-day choices to political ideologies and organisational forms. In modern societies the primary hierarchical institution is the state. Individualism — albeit a partial form — is most powerfully expressed in the dynamism of the market. While solidarity tends to be gauged by the level of social justice and welfare on the one hand, and the strength of shared civic identity and belonging on the other. Right now we are experiencing a crisis of confidence and legitimacy in each domain. One sign of this is the fact that the fourth major way of thinking about social change — fatalism — has become ever stronger.
History offers two important lessons in assessing whether societies such as ours can be renewed. The first lesson is that liberal democracies can achieve major advances when they get each active form of coordination working together at a societal level. For example, this was the case during the decades of the post-war economic miracle, when GDP growth and living standards rose, welfare expanded, inequality fell and the state was more confident and trusted. Even now Scandinavian countries generally manage to achieve a better balance between state, market and civil society, which is probably why they come top of most surveys on social outcomes and citizen well-being.
The second lesson is that these periods of healthy balance are more the exception than the rule. Economist Thomas Piketty has revealed the tendency in market societies for rising inequality, driven by diverging returns to labour and capital. Historian Walter Scheidel goes further, arguing that the trend of rising inequality in all societies has only ever been broken by plague, war or bloody revolution. Historians remind us that from the Neolithic to the industrial revolutions technological change often makes things worse for most people before it makes them better. With the next industrial revolution looming, it is not clear that modern societies are willing to endure impoverishment on the promise of better times over the horizon.
Politicians and campaigners tend to focus on just one dimension of the system-wide loss of confidence. They choose either business as their target, or the state or, more abstractly, individualism or liberalism. But it is the social system as a whole that needs renewal.
This argument is illustrated by the hard case of technology, the subject of a fascinating and brave lecture at the RSA by DeepMind’s Mustafa Suleyman. In addressing the vital challenge of aligning technological change with human progress, Suleyman suggested that traditional, hierarchical, governmental solutions — principally regulation — are inadequate. The unprecedented assets — financial, informational, human — of the major technology companies, their immense scope to do good or harm, and our growing dependence on them means that we cannot allow the traditional market goals of profitability and market share to be the only or even primary drivers of these companies’ behaviour. Finally, as consumers and citizens we do not have the knowledge, norms or embedded practice to know what technology is doing to us, let alone know how to make it a force for good. In shaping the digital age, hierarchical methods are too weak, individualist drivers wholly inadequate and solidaristic expectations and norms as yet inarticulate.
The potential scale and pace of technological change may be the strongest reason to think about future society as a whole. But we are not used to taking a system-wide perspective. When one type of social coordination feels underpowered in any system, a sense tends to grow that it needs to be strengthened. We can see this when public opinion shifts from support for lower taxes and restraints on public spending to greater demand for public investment and action on inequality, as it is now. While these cycles of opinion and policy bring stuttering progress, they do not address growing foundational weaknesses.
Think like a system, act like an entrepreneur
The starting point for a modern progressive programme has to be the attempt to renew each dimension of social coordination, expressed at the highest level by the state, the market and the sites of civil society, while also recognising how these systems react with and against each other. The RSA’s work has contributed to many of these debates. Ideas for the reform of welfare and government include further devolution of power to cities, the greater use of participative democratic processes, and attempts to reconfigure public services at the individual level as relational, but also as social movements that draw on and add to the resilience of civil society.
In the realm of markets, a programme for 21st-century capitalism would involve scaling up alternative forms of control — for example, mutual or municipal — to challenge existing models of shareholder and private equity ownership. This is particularly important in sectors such as utilities and technology. More fundamentally, the potential of technological change, such as AI, robotics and blockchain, to challenge systems of value creation, production and control, means that progressives at every level — from the global to the local — must move beyond primarily seeking to ameliorate the impacts of markets. Instead we must design social inclusion, human dignity and environmental sustainability into business models.
The civic sphere is more complex and less concrete, but no less important. On the one hand, as economic historian Richard Henry Tawney once argued, the progressive story needs to be as much about what the good society requires of citizens as what the state promises them. On the other hand, we need mobilising narratives about identity, place and belonging that are more generous and ambitious than nationalism, more textured and grounded than liberal universalism and more unifying than identity politics. Above all, we need a new generation of civic institutions suited to modern needs, capabilities and expectations.
To outline a feasible future is only half the task. Reform in any part of the social system will have knock-on effects in other parts; sometimes diminishing its impact, sometimes magnifying it. Progressives need to think hard about our model of change, about gaining influence and about using it. The RSA’s approach here is summed up in our injunction to change-makers to ‘think like a system and act like an entrepreneur’. This implies a strategy for reform that is deeper, more ambitious and more long term, but forms of action that are more agile, engaging and experimental. It means, for example, not choosing between hierarchical and networked models of change, but exploring how institution leaders and social movements can work together, continuously challenging and learning from each other.
From the global rise of nationalism to the depressed state of our economy, from the unprecedented and virtually unaccountable power of the global technology corporations to our apparent inability to look after the most vulnerable in the world and in our own country, things can look gloomy and frightening. But, as the song says, the darkest hour is just before the dawn. In the wrong hands, and put to the wrong purposes, technology could lead to profound division and escalating conflict. Directed to human ends, it could enable the next leap forward in human opportunity and fulfillment. It is time to reprogram the future.
This article appears in the RSA Journal Issue 4 2017–18.
