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Business Comment

Anthony Hilton: Plotting a way through this dangerous thicket of short-term thinking

The wealth of information is creating a poverty of attention

We all know there is vastly more information available today because of technology and the internet but while it is possible for people of a certain generation, like me, to appreciate just how much more is out there, we struggle to realise just how fundamentally it is changing human behaviour, and the huge implications which come with that.

On Wednesday, Andy Haldane, one of the brightest people in the Bank of England and in the country, delivered a startling speech which spelled out some of the implications. If all the information currently available were stacked on CDs, the pile would stretch to the moon and back three times, he said. Ninety per cent of this information has become available only in the past 10 years and half in the past three years. This rate of expansion will, if anything, get even faster and by 2020 is expected to have increased a further 150 fold. At this point that pile of CDs will go to the moon and back 10 times.

The two decades of this century will then account for 99 per cent of all the information ever created. If this was divided up between the seven billion or so people on the planet each would have at their fingertips the equivalent of 1,500 times the volume of information allegedly stored by the ancient Egyptians in the Library of Alexandria. Scholars say at that time the building housed every bit of knowledge known in the world.

But it is the implications of this which matter and Mr Haldane focused on two. First he said the much greater connectivity of the world – the way it has become one giant computer linked and economically linked network – made the world potentially much more unstable. For most of the time the network effect is benign, but when it gets overloaded for whatever reason everything gets corrupted at once so the effect is immediate and global. 

It is not like an eco-system; we can overfish for years and it does not seem to matter, than suddenly overnight the stocks vanish. That is why we have just had a financial crisis which for the first time hit the whole world at the same time, and why we are going to get this again, probably more severely and probably more frequently. If you think this has been bad get used to it – the probability is it will happen again and again.

The second effect is the impact on ourselves and the impact these data have on what is popularly known as the two sides of the brain – the instant-action, doing side and the cautious, considered planning side.

In theory more information is supposed to improve decision making, but only up to a point. Mr Haldane suggests all these data are overstimulating the doing side of the brain and this comes at a cost. The more information we are bombarded with the less we retain and absorb so our attention span is shortening – the wealth of information is creating a poverty of attention and this in turn is leading to an increase in short-term thinking and a bias against anything which takes too long or requires difficult decision making.

That is why society is losing the ability to deal with complex issues, why divorce rates are rising, chief executives have a shorter and shorter time in their jobs, company investment levels are at the lowest levels for decades, big decisions on infrastructure get kicked into the long grass and most of all we are already forgetting what should be the lessons of the financial crisis and going back to the bad old ways.

All this ties in with what was the other big event this week, the publication by Sir John Armitt on Thursday of a report which searches for better ways for this country to plan and build the infrastructure it needs.

Sir John was responsible for the Olympics, so knows what it takes to get big projects completed on time and on Budget, and conversely how easy it also is for things to be paralysed by controversy, be it Heathrow’s expansion, High Speed 2, fracking for gas, onshore wind farms or nuclear power. Thus his core suggestion is to create a cross-party expert-led Independent Infrastructure Commission, which would establish what was needed in the coming quarter century, prioritise it, explain why it is needed, get the political commitment and the public’s backing, make sure the proper planning was in place and then make sure it happens.

Mr Haldane’s solution is on similar lines. He believes the counterweight to information overload and short-term thinking lies in the creation of new and the harnessing of old institutions to provide society with its planning and long-term vision.

The point is that institutional memory passes down the generations and provides a perspective which can counterbalance the short termism and myopia of politics and the media. This we need as never before.