Monday, 20 February 2017

The supermarket food gamble may be up

Illustration by Nathalie Lees

Felicity Lawrence in The Guardian

The UK’s clock has been set to Permanent Global Summer Time once more after a temporary blip. Courgettes, spinach and iceberg lettuce are back on the shelves, and the panic over the lack of imported fruit and vegetables has been contained. “As you were, everyone,” appears to be the message.

But why would supermarkets – which are said to have lost sales worth as much as £8m in January thanks to record-breaking, crop-wrecking snow and rainfall in the usually mild winter regions of Spain and Italy – be so keen to fly in substitutes from the US at exorbitant cost?

Why would they sell at a loss rather than let us go without, or put up prices to reflect the changing market? Why indeed would anyone air-freight watery lettuce across the whole of the American continent and the Atlantic when it takes 127 calories of fuel energy to fly just 1 food calorie of that lettuce to the UK from California?

The answer is that, in the past 40 years, a whole supermarket system has been built on the seductive illusion of this Permanent Global Summer Time. As a result, a cornucopia of perpetual harvest is one of the key selling points that big stores have over rival retailers. If the enticing fresh produce section placed near the front of each store to draw you in starts looking a bit empty, we might not bother to shop there at all.

But when you take into account climate change, the shortages of early 2017 look more like a taste of things to come than just a blip, and that is almost impossible for supermarkets to admit.

Add the impact of this winter’s weather on Mediterranean production, the inflationary pressures from a post-Brexit fall in the value of sterling against the euro, and the threat of tariffs as we exit the single market, and suddenly the model begins to look extraordinarily vulnerable.

I can remember the precise moment I first understood that we had been taken into this fantastical, nature-defying system without most of us really noticing. It was 1990 and I had been living and working with Afghan refugees in Pakistan’s North-West Frontier province for a long period. The bazaars where we bought our food were seasonal, and stocked from the immediate region. Back home on leave in the UK, I had that sense of dislocation that enables you to see your own culture as if from the outside. It was winter, but the supermarkets were full of fresh fruits and vegetables from around the world. The shelves looked wonderful, perfect, almost clinical, as though invented in a lab in my absence; but there was no smell. It was vaguely troubling in a way I couldn’t identify at the time.

 ‘The shelves looked wonderful, perfect, almost clinical, as though invented in a lab in my absence; but there was no smell.’ Photograph: Alexander Britton/PA

Our food was not like this before the 1980s. The transformation was made possible by the third industrial revolution – the great leap in information technology and logistics that enabled retailers to dispense with keeping stock at the back of stores. Instead they were able to switch to minutely tuned, just-in-time electronic ordering from centralised distribution centres and to use the space freed up to extend their ranges from a typical 8,000 lines to 40,000, knocking out competition from all sorts of independent specialist shops as they did so.

The precursor to these new constantly replenished supply lines was our joining the European common market. Then with Spain, Portugal and Greece also joining in 1986, fresh territories from which to source opened up. European funds paid for fast new road networks across the Mediterranean, building the infrastructure for 44-tonne refrigerated trucks to whisk southern produce to northern Europe in the winter months, not just to the UK but to Germany and Scandinavia too. During the 90s there was a 90% increase in the movement of agricultural and food products between the UK and Europe.

Food writer Joanna Blythman coined the term Permanent Global Summer Time in an article for the Guardian in 2002. By then the astonishing shift in supply chains had come into sharp focus. Although the new supply system is miraculous in its scale, speed and efficiency, it has two fatal flaws.

First, it depends on the profligate use of finite resources – water, soil, and fossil fuels (with all their greenhouse gas emissions). Depending on whose figures you take, between a fifth and a third of UK emissions relate to food. More and more, we eat by exploiting the often fragile ecosystems of other countries. The UK is the sixth largest importer in the world of virtual water – the water needed to produce our food elsewhere.

Second, the system is built on the exploitation of cheap labour, mostly migrant, that has been socially disruptive and politically fraught. Migrant labour is not coincidental but structural to the just-in-time model, which needs the extreme flexibility of a class of desperate workers to function. Undocumented, underpaid migrants from Africa have provided the labour to harvest Italian and Spanish crops. Low-paid migrants, predominantly from eastern Europe, have become the backbone of the UK’s centralised distribution centres, providing 35% of food manufacturing labour, and 70-80% of harvesting labour.

‘Migrant labour is structural to the just-in-time model, which needs the extreme flexibility of a class of desperate workers to function.’ Photograph: Alamy Stock Photo

The brief disappearance of a few green and salad vegetables was hardly a great deprivation, but we should take it seriously as an early warning sign. Like the banking system, our food system seems too big, too sophisticated and too embedded in everyday life to fail. Yet privately, supermarket buyers have been talking for at least five years about “choice editing” – that is, editing out some of the fresh foods we have come to take for granted because importing them is unsustainable. Examples might include asparagus from Peru, 95% of which comes from the Ica valley where wells are running dry, and Moroccan tomatoes sourced from areas suffering severe water stress and aquifer depletion.

Supermarkets expected water shortages to bring the first jolts to the system. Brexit and climate change have brought other potential shocks to the fore. 

The UK only produces a little over half of what its people consume; over a quarterof what we eat and drink comes from the EU. Reverting to more local ways of meeting our needs has become harder as the old infrastructure of regional wholesale markets has disappeared, and as farmers continue to exit the food business because they cannot make a living.

The government view, under the current Conservative administration and previous coalition and Labour ones, has been that the market will provide. In a new era of protectionism and with the UK heading out of the EU, that looks increasingly complacent. A decade ago, the Ministry of Defence predicted that changes to the climate, globalisation and global inequality would “touch the lives of everyone on the planet” within the next 20 years. “Food and water insecurity will drive mass migrations in the worst areas, but may also be possible in more affluent areas because of distribution problems, specialised agriculture and aggressive pricing … a succession of poor harvests may cause major price spikes resulting in significant economic and political turbulence,” a document warned.

Leaving the EU could be an opportunity for a radical rethink of the food system, but the government shows little sign of grasping it. So when I see glossy magazine pictures and Instagram snaps of summer dishes conjured up in the middle of winter of ingredients flown in from distant climes, I wonder if, a couple of decades from now, we will look to ourselves like the late Victorian colonials photographed proudly next to dead lions and other game in Africa. They could hardly have imagined they were consuming their world out of existence.

Cricket Captains aren't that important anymore. Same for high paid Business Leaders

Tim Wigmore in Cricinfo

It has been a seminal fortnight for the England cricket team. The country has a new Test match captain, and Joe Root's appointment could herald obvious changes to the team's approach, on and off the field. Yet whether the change of captaincy will have any positive or negative effect on results is an altogether different matter.

How much does individual leadership really matter? It's a question valid in cricket, sport and beyond.

"Being in charge isn't what it used to be," writes Moisés Naím in The End of Power. He shows how, for all the focus on the figureheads of teams, the powers of leaders are being eroded, in everything from business to politics and the military. "In the 21st century, power is easier to get, harder to use - and easier to lose," Naím says, arguing that, because of the digital revolution, the collapse of deference, and increased accountability within organisations, the powerful now face more limitations on their power than ever before. In the second half of the 20th century, weaker sides (in terms of soldiers and weapons) achieved their strategic goals in the majority of wars. The tenures of chief executives are becoming shorter, and those in charge also face more internal constraints on their power than ever before.

The most successful leaders have never been more venerated: the leadership-coaching industry is worth an estimated US$50 billion every year, brimming with corporate bigwigs attempting to learn the "lessons" of other leaders' success. Yet there is no real evidence of the enduring superstar qualities of those who cash in. Award-winning chief executives subsequently underperform, both against their own performance and against non-prize-winning CEOs, as research by Ulrike Malmendier and Geoffrey Tate shows. A lot of the lauded CEOs' previous success, in other words, might have been simply luck, and their subsequent underperformance regression to the mean.

The obsession with leadership extends to sport, yet leaders' power is being reduced here also. "In early-modern sports - the late 19th century - there was little or no coaching and hence the captain on the field had a significant leadership role to play," explains the sports economist and historian Stefan Szymanski. "As sport became more organised and coaching strategy developed, the role of the captain on the field diminished."

Compared with other sports, cricket is unusual in giving as much power to the captain as it does. Yet the cricket captain has not been immune to the wider erosion in the importance of leadership across sport. "The role is declining as the potential of coaches to add analytical support based on data analysis has increased," Szymanski says.

It is instructive to compare the responsibility of Mike Brearley to that of Root today. While Root will be supported by a coterie of coaches, physiologists and analysts, Brearley operated before the modern coach, and had to oversee warming up and stretching before each day. In the days of amateurism, captains even had to motivate amateurs to play at all. Today the captain is far more important in club cricket, where they have no coaches to aid them and often face an arduous task to even get a full team together, than in the professional game.

The power of individual coaches has also been diminished, because the responsibilities that were once the preserve of one man are now divided up among a multitude of personnel. In international cricket teams today, what were, 25 years ago, the sole functions of the coach are now divided up among what often amounts to a 2nd XI of support staff.

While the narrative of football's Premier League now revolves around managers, each result explored through the prism of their success or failure, perhaps they have never mattered less. In the 1930s, Arsenal manager Herbert Chapman not merely coached innovatively but led Arsenal to introduce numbered shirts, and build floodlights and a new stand. Unless they are named Arsene Wenger, the average Premier League manager now lasts a year in the job. Given the complexities of modern sport, there is a limit to what they can do. Indeed, studies of poorly performing clubs find that performances improve by an almost identical amount whether or not a new manager is appointed. The new boss, then, is rarely much better or worse than the old boss.

The book Soccernomics finds a 90% correlation between wage bills and league finishes over a ten-year period; just 10% of top-flight managers consistently overachieve when wages are factored into account. So, brilliant leadership can make a difference, but only in exceptional cases. It was not merely modesty that led Yogi Berra, when asked what made a great baseball coach, to reply: "A great ball team."

Joe Root will enjoy the services of several coaches, analysts and managers in his role as England's Test captain, thereby diffusing his leadership responsibilities © Getty Images

The captain in golf's Ryder Cup has a job akin to the coach in other sports. It offers a prime example of how narratives are constructed around the leader, assigning them more power than they really have. In The Captain Myth, Richard Gillis explores how victories or defeats are retrospectively explained through a captain's mistakes or shrewd decisions. Every match must consist of a Good Captain and Bad Captain, and the Good Captain is always the victor. The trouble with this simplistic narrative is that, as Paul Azinger, who led the US to victory in the 2008 Ryder Cup, reflects, "There have been some captains who have micro-managed everything and lost. There have been captains who were drunk every night and won. There is no blueprint on winning."

There is a paradox to leadership in modern sport. Leaders have never faced more scrutiny - but most have never had less power. Professionalism and the explosion of money in sport means that decisions once the sole preserve of a captain or head coach are now influenced by dozens of others behind the scenes: specialist coaches, performance analysts who mine data, dieticians, psychologists and those responsible for nurturing academy players. Perhaps the cricket team that has performed most above themselves in recent years is Northamptonshire in the T20 Blast. Reaching three finals in four years has not just been a triumph for Alex Wakely's astute captaincy, but also for the coaching staff, the data analyst, the physio and all those involved in player recruitment.

The reluctance to recognise the limits of leadership has deep roots. We are a storytelling species. People make for much better stories than underlying, impersonal factors; Soccernomics shows that success in international football can broadly be explained by three factors - population size, GDP, and experience playing the sport - that have nothing to do with leadership. In The Captain Myth, Gillis writes that, because of psychological biases "meshed with our obsession with celebrity, it's easy to understand how the captain has become such a prominent figure in the sports world". In cricket, he tells me that "the decisions of the captain can be significant, but the relationship between the decisions and the outcome is not linear, it's far messier than that, and makes a far less enjoyable tale".

As much as coaches and fans crave inspirational leadership, in modern sport, with huge and complex professional structures to manage, perhaps it is easier for a single leader to make a negative difference than a positive one. "Good captaincy and coaching have far less of an impact on outcomes than bad captaincy and coaching does," believes Trent Woodhill, a leading T20 coach. Bad leadership can marginalise and disempower the backroom team, effectively preventing support staff from doing their jobs properly. Beyond sport, Naím believes that we are in an age of "heightened vulnerability to bad ideas and bad leaders". The analysis extends beyond sport. Disruptive technology has not only changed the nature of power, Naím believes, but also led to an age of "heightened vulnerability to bad ideas and bad leaders".

Root has captained in just four first-class games, yet this is in keeping with modern norms. That Virat Kohli, Steven Smith and Kane Williamson have all been successful after their appointments as captain, despite a derisory amount of prior leadership experience in professional sport, suggests that captaincy experience - and, by implication, captaincy skill - is simply not that important. The absence of specialist captains, at both domestic and international level, also reflects a recognition of the limits of what a skipper can achieve.

"Playing in the middle and understanding the demands is more important than captaincy," Andrew Strauss said when Root was unveiled. The greatest potential boon of a Root captaincy lies not in a new culture he might create, or more enterprising leadership, but the possibility of greater run-scoring: if Alastair Cook is reinvigorated without the leadership, while, in keeping with recent England captains, Root's own batting initially enjoys an upswing.

Leadership is not irrelevant. Occasionally cricketers are particularly suited to a leadership role - Brearley, Graeme Smith, or Misbah-ul-Haq, say; some, like Kevin Pietersen, might be the opposite. But the overwhelming majority of captains are bunched in the middle - and, in any case, a captain's ability to do good is marginal, now more than ever. For all the tendency to focus on a team's figurehead, great leadership is a collective endeavour, and operates against wider limitations. Perhaps this is why Strauss is so unperturbed by Root's lack of captaincy experience. Only rarely does the identity of a captain really matter.

Sunday, 19 February 2017

Success and Luck: good fortune and the myth of meritocracy

Prof. Robert Frank

‘From bad to worse’: Greece hurtles towards a final reckoning

Helena Smith in The Guardian

Dimitris Costopoulos stood, worry beads in hand, under brilliant blue skies in front of the Greek parliament. Wearing freshly pressed trousers, polished shoes and a smart winter jacket – “my Sunday best” – he had risen at 5am to get on the bus that would take him to Athens 200 miles away and to the great sandstone edifice on Syntagma Square. By his own admission, protests were not his thing.

At 71, the farmer rarely ventures from Proastio, his village on the fertile plains of Thessaly. “But everything is going wrong,” he lamented on Tuesday, his voice hoarse after hours of chanting anti-government slogans.

---For Background Knowledge read:

Yanis Varoufakis and the Greek Tragedy


“Before there was an order to things, you could build a house, educate your children, spoil your grandchildren. Now the cost of everything has gone up and with taxes you can barely afford to survive. Once I’ve paid for fuel, fertilisers and grains, there is really nothing left.”

Costopoulos is Greece’s Everyman; the human voice in a debt crisis that refuses to go away. Eight years after it first erupted, the drama shows every sign of reigniting, only this time in a new dark age of Trumpian politics, post-Brexit Europe, terror attacks and rise of the populist far right.

“I grow wheat,” said Costopoulos, holding out his wizened hands. “I am not in the building behind me. I don’t make decisions. Honestly, I can’t understand why things are going from bad to worse, why this just can’t be solved.”

As Greece hurtles towards another full-blown confrontation with the creditors keeping it afloat, and as tensions over stalled bailout negotiations mount, it is a question many are asking.

The country’s epic struggle to avert bankruptcy should have been settled when Athens received €110bn in aid – the biggest financial rescue programme in global history – from the EU and International Monetary Fund in May 2010. Instead, three bailouts later, it is still wrangling over the terms of the latest €86bn emergency loan package, with lenders also at loggerheads and diplomats no longer talking of a can, but rather a bomb, being kicked down the road. Default looms if a €7.4bn debt repayment – money owed mostly to the European Central Bank – is not honoured in July.

Farmer Dimitris Costopoulos in front of the Greek parliament in Athens. Photograph: Helena Smith for the Observer

Amid the uncertainty, volatility has returned to the markets. So, too, has fear, with an estimated €2.2bn being withdrawn from banks by panic-stricken depositors since the beginning of the year. With talk of Greece’s exit from the euro being heard again, farmers, trade unions and other sectors enraged by the eviscerating effects of austerity have once more come out in protest.

From his seventh-floor office on Mitropoleos, Makis Balaouras, an MP with the governing Syriza party, has a good view of the goings-on in Syntagma. Demonstrations – what the former trade unionist calls “the movement” – are a fine thing. “I wish people were out there mobilising more,” he sighed. “Protests are in our ideological and political DNA. They are important, they send a message.”

This is the irony of Syriza, the leftwing party catapulted to power on a ticket to “tear up” the hated bailout accords widely blamed for extraordinary levels of Greek unemployment, poverty and emigration. Two years into office it has instead overseen the most punishing austerity measures to date, slashing public-sector salaries and pensions, cutting services, agreeing to the biggest privatisation programme in European history and raising taxes on everything from cars to beer – all of which has been the price of the loans that have kept default at bay and Greece in the euro.

In the maelstrom the economy has improved, with Athens achieving a noticeable primary surplus last year, but the social crisis has intensified.

For men like Balaouras, who suffered appalling torture for his leftwing beliefs at the hands of the 1967-74 colonels’ regime, the policies have been galling. With the IMF and EU arguing over the country’s ability to reach tough fiscal targets when the current bailout expires in August next year, the demand for €3.6bn of more measures has left many in Syriza reeling. Without upfront legislation on the reforms, creditors say, they cannot conclude a compliance review on which the next tranche of bailout aid hangs.

“We had an agreement,” insisted Balaouras, looking despondently down at his desert boots. “We kept to our side of the deal, but the lenders haven’t kept to their side because now they are asking for more. We want the review to end. We want to go forward. This situation is in the interests of no one. But to get there we have to have an honourable compromise. Without that there will be a clash.

It had been hoped that an agreement would be struck on Monday at what had been billed as a high-stakes meeting of euro area finance ministers. On Friday, EU officials announced that the deadline had been all but missed because there had been little convergence between the two sides.

With the Netherlands holding general elections next month, and France and Germany also heading to the polls in May and September, fears of the dispute becoming increasingly politicised have added to its complexity. Highlighting those concerns, the German chancellor, Angela Merkel, attempted to end the rift that has emerged between eurozone lenders and the IMF over the fund’s insistence that Greece can only begin to recover if its €320bn debt pile is reduced substantially.

In talks with Christine Lagarde, the Washington-based IMF’s managing director, Merkel agreed to discuss the issue during a further meeting between the two women to be held on Wednesday. The IMF has steadfastly refused to sign up to the latest bailout, arguing that Greek debt is not only unmanageable but on a trajectory to become explosive by 2030. Berlin, the biggest contributor of the €250bn Greece has so far received, says it will be unable to disburse further funds without the IMF on board.

The assumption is that the prime minister, Alexis Tsipras, will cave in, just as he did when the country came closest yet to leaving the euro at the height of the crisis in the summer of 2015. But the 41-year-old leader, like Syriza, has been pummelled in the polls. Persuading disaffected backbenchers to support more measures, and then selling them to a populace exhausted by repeated rounds of austerity, will be extremely difficult. Disappointment has increasingly given way to the death of hope – a sentiment reinforced by the realisation that Cyprus and other bailed-out countries, by contrast, are no longer under international supervision.

In his city centre office, the former finance minister Evangelos Venizelos pondered where Greece’s predicament was now. “[We are] at the same point we were several years ago,” he joked. “The only difference is that anti-European sentiment is growing. What was once a very friendly country towards Europe is becoming increasingly less so, and with that comes a lot of danger, a lot of risk.”

When historians look back they, too, may conclude that Greece has expended a great deal of energy not moving forward at all.

The arc of crisis that has swept the country – coursing like a cancer through its body politic, devastating its public health system, shattering lives – has been an exercise in the absurd. The feat of pulling off the greatest fiscal adjustment in modern times has spawned a slump longer and deeper than the Great Depression, with the Greek economy shrinking more than 25% since the crisis began.

Even if the latest impasse is broken and a deal is reached with creditors soon, few believe that in a country of weak governance and institutions it will be easy to enforce. Political turbulence will almost certainly beckon; the prospect of “Grexit” will grow.

“Grexit is the last thing we want, but we may arrive at a point of serious dilemmas,” said Venizelos. “Whatever deal is reached will be very difficult to implement, but that notwithstanding, it is not the memoranda [the bailout accords] that caused the crisis. The crisis was born in Greece long before.”

Like every crisis government before it, Tsipras’s administration is acutely aware that salvation will come only when Greece can return to the markets and raise funds. What happens in the weeks ahead could determine if that is likely to happen at all.

Back in Syntagma, Costopoulos the good-natured farmer ponders what lies ahead. Like every Greek, he stands to be deeply affected. “All I know is that we are all being pushed,” he said, searching for the right words. “Pushed in the direction of somewhere very explosive, somewhere we do not want to be.”