Your new book instructs us in smart decision-making. What could world leaders learn from it in relation to Syria?
In this fast-moving situation with new information emerging almost daily, leaders need to constantly re-evaluate the options and be willing to change course. They also need to retain a healthy dose of scepticism about whatever pledges President Assad makes – how someone has behaved in the past is a pretty reliable indicator for how they’ll behave in the future.
Also critical is that they recognise the role emotions play in decision-making. President Obama’s main advisers Susan Rice (National Security Adviser) and Samantha Power (US Ambassador to the United Nations) were very scarred by the Rwandan genocides. This has shaped their steer. In the UK an erroneous parallel has been drawn with Iraq. We cannot allow the shame associated with that war to drive decisions in this case.
It’s also a book that aims to help people deal with information overload. What methods do you deploy yourself?
The amount of information we’re exposed to nowadays is exponentially more than in the past. One edition of the New York Times has as much information in it as we would’ve been exposed to in a lifetime in the 17th century. Add to that the daily deluge of tweets, emails, texts and no wonder many of us are finding it hard to cope. I batch my emails (each time we check one it takes on average 22 minutes to return to whatever we were doing at the same level of focus), take digital Sabbaths, and make sure to carve out thinking time and space.
George Osborne was talking up the recovery this week. As an economist yourself, what is your view?
While recent data is encouraging, it’s far too early to be complacent. The UK economy is linked to the global economy, which remains very fragile. Euro area banks continue to be weighed down by bad debt, and are insufficiently capitalised. Growth is markedly slowing in China. There is a significant chance that the nascent US recovery will be thwarted by more Congressional gridlock. Geopolitically, things are especially volatile. Each of these factors could destroy any green shoots of recovery.
Does growth mean anything if living standards are falling?
I think the more important question is: does economic growth mean anything if the growth is not shared? In the UK in recent times, it hasn’t been. Not only did the boom years disproportionately favour the most wealthy; the recent bust years have disproportionately harmed those on lower incomes, with the burden of austerity falling hardest on those least able to bear it. For those on low incomes, life has become a daily struggle. Such a two-tier economy is both undesirable and unsustainable.
Do you share the Barclays chief’s concern that the recent housing bubble will be “difficult to control”?
The combination of low interest rates and the government’s Help to Buy scheme is definitely bubble-inducing. Add to this the concern that several banks and mortgage providers are beginning to embark on a new era of sub-prime lending and no wonder people are worried. Mark Carney, Governor of the Bank of England, is monitoring the situation and has a series of measures up his sleeves. We need regulators to be on the front foot too, willing and able to rein lenders in when need be.
What is the relationship that the Labour party should have with the unions?
It’s essential for Labour that it retains strong links with trade unions. Yet it needs to control its own destiny and not be beholden to them. Great politicians are great negotiators, capable of finding a way of achieving their goals but keeping tricky partners on side. So this is a test in some ways of how good a politician Ed Miliband is.
As the Lib Dem conference begins next week, how do you see the party’s future?
The big question is who they might be in coalition with next time round. Another hung parliament is a real prospect, but would it be with the Tories or Labour? Clegg needs to walk the tightrope of shoring up his leftist credentials while governing a centre-right coalition. As we move towards 2015, the party needs too to work increasingly hard to differentiate itself. It needs to outline the areas of policy that define it, and make sure the public understands the extent to which it has affected policy while in office.
What lessons do you draw about the management of the BBC from its senior figures’ appearance before MPs this week?
It has not been a good week for the BBC and questions will be asked about its governance. It’s important they are. The BBC is one of Britain’s most valuable public institutions and it needs the right structures. Yet the constant bashing in the newspapers smacks of Schadenfreude. It risks damaging something we should all feel very proud of and enjoy. No other nation has a public broadcaster of the quality and impact of the BBC. We need to cherish it.
Is there a problem with “boring snoring” politicians?
I think Ian Katz is going to be a great editor of Newsnight. We’ve all mis-sent an email, text or tweet. But the broader point this raises is that politicians have an increasing challenge to engage the public with Westminster, even more so with young people who are more and more disengaged with conventional party politics. It’s not that we need our politicians to be rock stars, it’s that we need to feel connected to them, and them to us. The danger is that populist politicians get this, while mainstream ones, typically, don’t.
Noreena Hertz’s ‘Eyes Wide Open: How to Make Smart Decisions in a Confusing World’ (William Collins) is out now.