The Tyranny of Certainty

10th January, 2013 11:14 am

There is too much certainty in politics. How often do you hear that policy X will definitely do Y? In political debate you hear very strong opinions on most policies. This, of course, is what you should hear in a vigorous democracy. But there is often something missing in this debate – an admission that there are limits to our knowledge. This is understandable. If a party has to sell a policy the case needs to be made as strong as possible. Admitting that there may be some uncertainty is often too big a chink in the armour. Some recent research sheds light on the sorts of things that influence policy outcomes that have little to do with the policies implemented by governments. They’re useful examples of what can happen when policy makers aren’t looking, can’t see or are wilfully ignorant.

When Tony Blair talked about cutting crime and cutting the causes of crime did he ever mention the role lead poisoning could play in crime rates? Not that I can remember, or at least find on Google. Crime has been dropping throughout the Western world since the 1980s which suggests there may be a common cause given that most countries followed different policies. It has become fashionable since Freakonomics for the drop in crime to be attributed to legalisation of abortions. However, another, more plausible explanation is being out forward. Exposure to lead has been associated with violent behaviour in people. The main way the mass of people got exposed to lead in the postwar period was through petrol and paint. Lead started to be banned from petrol and paint across the world in the 1980s and appears to have been followed by a drop in crime. At the time this wasn’t put forward as a suggestion and was not predicted, so it would be unfair to blame politicians for not taking it into account. Nevertheless, if we had known there was going to be drop in crime how would the law and order policies of Tory and Labour governments been different?

Another interesting bit of research connects the stock market boom of 1982-99 to the demographic spike of the baby boomers. There have been many explanations for the bull market of that time. The usual explanation given is that degregulated markets, rising productivity and globalisation were the main drivers behind this, bringing double digit returns for stock market investors. The reality seems to be somewhat different. There was a huge demographic bulge of baby boomers reaching the height of their earning potential and investing lots of money in stocks and shares. This cohort was at the stage in life where they were investing in relatively risky, but high growth, stocks. Worryingly for us now it looks like we’re going reap the whirlwind over the coming decades as the baby boom generation’s investment decisions change to less risky bonds. According to Michael Gavin, managing director and economist at Barclay’s Capital, the 1980s and 1990s should be seen as an anomaly rather than the norm. Looking back, if this had put forward as the main cause of the stock market boom would the Labour government in 1997 have been as gung-ho about catering to the City’s every need and whim? Would the success of the City have been seen more as riding the crest of a fortuitous demographic wave rather than the result policy decisions in the favour of banks?

The problem is that this is all very difficult to predict. John Kay is right to point out that only fools claim to know the future. What later seems like an undeniable trend may only be predicted by some slightly potty sounding academics. The early advocates of human made global warming faced such criticism. There are also many competing ideas at any given time. There were a number of different factors at work in the two examples above, including government policy. In the end once a party decides on its policies the machine to defend them whirls into action and the hatches are closed. That’s how it has to work. A party announces a policy and releases a minion of ‘28 Days Later’-esque rabid zombies infected with a certainty virus. Nonetheless, every now and again it’s worth sitting back to take in a wider view and remembering that policies are built on the shifting sands of change.

We can’t always know where they will take us, but we still need to make a decision about where to go.

John Clarke blogs at johnmichaelclarke.wordpress.com

  • aracataca

    A very apposite and of course completely correct piece. I also believe that uncertainty chimes with a Socialist outlook on the world. The fact is that however much capitalism and the Tory Party tell us that this is the ways things HAVE TO BE the reality is that they don’t have to be that way at all. Societies change, economies change, people change and ideas change. There is no inevitability whatsoever about the eternal triumph of capitalism and the statement that ‘There is no alternative’ was, is and always will be a great big fat lie.

  • MrSauce

    What a remarkable load of sense.
    Thanks for posting – this has made my day.
    It would be great to see some evidence-based policy in the future, not just statistics hijacked to justify a prejudiced policy decision. Maybe I’m hoping for too much.
    Not so sure about lead in paint finding its way into peoples brains any more than the lead in the batteries of electric cars does (or that on the church roof, even), but the TEL in petrol certainly had a way in.

    • johnmclarke

      Thanks MrSauce, glad it made your day. The Government’s “Nudge Unit” is working with Ben Goldacre on randomised controlled trials for policy. These could be useful but don’t really work for big issues such as what interest rate to set.
      http://www.cabinetoffice.gov.uk/resource-library/test-learn-adapt-developing-public-policy-randomised-controlled-trials

      • MrSauce

        Odd as it may seem, agricultural research in the 1920s could help here…
        It was realised that full control of variables was not possible when running trials outdoors where the weather changes it whether you like it or not. Fisher’s treatment of data to derive useful conclusions under difficult conditions seems appropriate to policy trials where outside influences are unavoidable. I don’t think it will make it onto any PPE courses, though.

        • johnmclarke

          That’s interesting stuff. I’ll have to look into it.

          There’s a lot that doesn’t make it onto PPE courses, possibly common sense included. Yet the tyranny of PPE looks set to continue.

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