The monstrous attempted murders in Salisbury, allegedly authorised by the Russian state, were shocking. Expelling diplomats, limiting attendance at the World Cup, and orchestrating international condemnation through the UN and Nato are good symbolic gestures. But they will not stop Russian state-inspired terrorism taking place in the UK.
Wouldn’t it be far more effective to clamp down on Russian use of Britain as a safe haven for illegal wealth? Britain has become the jurisdiction of choice for kleptocrats, crooks and money launderers – including Russians – because of our weak regulatory framework, shrouded in secrecy and very lightly policed.
Our historic reputation for integrity and trustworthiness is being undermined by the rapid growth of illicit wealth that is brought into or through the UK and its tax havens. The National Crime Agency estimates that £90bn of criminal money is laundered through the UK each year. That is 4% of the UK’s GDP – and the estimate is probably conservative.
Much of the money goes into buying UK properties. Global Witness claims 85,000 properties across the UK are owned by companies that are incorporated in UK tax havens. According to Transparency International, almost one in 10 of the properties in the City of Westminster are owned by companies registered in an offshore jurisdiction. Many of the houses are bought and then left to lie empty; Indeed, Kensington and Chelsea’s electoral roll has declined by 8% since 2010, while the UK as a whole has experienced a 3% increase in its electorate over the same period. So who is buying homes in the borough, and why are they leaving them empty?
Britain has always been open and welcoming, and there are many people from other countries who want to come and live here for good reasons who make a great contribution to our society. But we need to know that those buying our houses are doing so for legitimate reasons, and with clean money.
In 2015, David Cameron promised to introduce a register detailing the beneficial owner of all UK properties. But the government has just announced this will not happen before 2021. If we really want to stop corrupt money – from Russia and elsewhere – being used to acquire British homes the government could implement Cameron’s undertaking immediately. And it should strengthen the checks and balances on company formation: the laxness of current rules makes it too easy for crooks to set up corporate entities through which they might launder money.
Consider Scottish limited partnerships. These were created in 1907 to help Scottish farmers invest in their land but limit their liability. But when you set one up, you are not required to name an actual person as a partner: you simply cite a company, often located in a tax haven. The reporting requirements for Scottish partnerships are minimal: there is no need to file accounts at Companies House, no requirement to have a UK bank account, and no need to pay UK tax.
Last year the government required newly formed partnerships to register the names of the person with significant control in a company. A quarter of the new Scottish partnerships have failed to reveal this information. Of those that did complete the register, 30% were Ukrainian, 16% were Russian and just 8.7% were British.If we simply required better information about those who set up UK corporate entities, we could stem the flow of dirty money into Britain. All we need do is ask for a birth certificate or passport so we can assess the legitimacy of both the individual and their money.
We should also strengthen the way our corporate structures are policed. It’s ridiculous that just six people in Companies House are trying to check whether or not some 4m companies comply with the law and provide accurate information. It’s shortsighted to starve HMRC, the police, the Serious Fraud Office and the Financial Conduct Authority of the resources they need to stamp out corruption and tackle financial crime.
Finally a growing number of MPs from all parties want the government to implement another undertaking made by David Cameron in 2013. We need public registers of beneficial ownership in our tax havens so that the public, the media and civil society knows who owns the companies that hide their identity and their wealth in these secret jurisdictions. Transparency would at a stroke stop tax havens being used for corrupt purposes by criminals from Russia and elsewhere. The government could use the anti-money laundering bill currently being considered by parliament to do this.
Take these actions. Then the Russians would know that when we say we will not allow unlawful acts by states or criminals to pass without punishment, we mean it.
Here's the received wisdom: when the British Empire faded in size and significance after World War Two, a few scattered islands around the globe wanted to keep their imperial ties to London.
The British government had to find a way to reduce the economic dependence of the likes of Bermuda, Montserrat or the British Virgin Islands, so it awarded them special tax-exempt status, creating the conditions for a thriving financial services industry.
Yes, tax evasion and money laundering may have got a little out of hand from time to time, but overall it succeeded in lifting them out of dependence on the UK government.
But there's a deeper story. It wasn't by design that the remnants of a dying British Empire morphed into a world leader in offshore financial services, selling secrecy and tax avoidance to multi-nationals and the wealthiest individuals in the world.
Instead, the crucial moment was more of an accident - which gave rise to advantages no-one had foreseen.
And it began not in Bermuda or Jersey but in another offshore centre - "offshore" not to the UK, but to the US - the City of London.
Incentives to avoid
When the 20th Century began, income tax was in single digits and progressive taxation - charging richer people a higher rate - had barely begun.
In the run-up to World War One, chancellors of the exchequer - from Asquith to Lloyd George - began raising taxes to pay for social reforms, such as the old age pension.
As the war progressed, the state demanded more and more income tax from every citizen and higher rates for the wealthy, leading to a top rate of 30% by 1919.
Accountants to wealthy individuals began to devise ways to avoid tax. Clients could become resident in Jersey, where tax rates were far lighter.
Or, if they wanted to stay in London, they might put their money in a trust registered elsewhere, perhaps on the Isle of Man, where in theory it was no longer theirs - and therefore not visible to the prying eyes of an Inland Revenue inspector.
David Lloyd George served as Chancellor in Herbert Henry Asquith's government, before rising to PM in 1916
But it was in the dying days of the Empire that the offshore financial services industry truly boomed.
Defined by purpose rather than geography, "offshore" means any jurisdiction that seeks to attract investors on the basis of light taxes and looser regulations.
On that basis, the epicentre of the offshore industry is not Nassau in the Bahamas or George Town in the Cayman Islands.
As author Nick Shaxson points out in his fascinating offshore expose, Treasure Islands: "The modern offshore system did not start its explosive growth on scandal-tainted and palm-fringed islands in the Caribbean, or in the Alpine foothills of Zurich. It all began in London, as Britain's formal Empire gave way to something more subtle."
By accident - not design
In 1957, Britain and its imperial remains were trying to recover from a financial crisis. The previous year the UK had joined forces with France and Israel to try to recapture the Suez Canal after it was nationalised by the defiant anti-colonial Egyptian President, Gamal Abdel Nasser.
Viewing the invasion as European imperialism at its worst, the US refused any assistance.
By the end of 1956, a run on the pound was under way. The Bank of England wanted to curb the outflow of pounds by boosting interest rates sharply, but Her Majesty's Treasury had other ideas.
Since the Bretton Woods economic conference of 1944 towards the end of World War Two, countries had agreed to control movements of capital to curb the speculative flows into and out of countries that had worsened the economic crises of the past.
If, say, Tate & Lyle wanted to invest several million pounds in a new sugar production facility in Jamaica, it would need signed approval from Her Majesty's Treasury.
Normally this was a formality. But during the Suez crisis, the Treasury announced that, on a temporary basis, it would no longer approve foreign capital investments.Image copyrightREUTERSImage captionThe Bank of England did not get its way against the Treasury
The City's merchant banks were alarmed. Arranging finance for projects in the former colonies was their lifeblood. How would they avoid ruin?
Digging through the archives, financial academic Gary Burn unearthed what happened next.
Hearing the banks' complaints in a series of meetings, the Bank of England agreed in late 1957 to allow the commercial banks to continue to lend and borrow to foreign clients on two conditions: the lending had to be in a currency other than sterling, and both sides of the transaction - the lender and the borrower - had to reside somewhere other than the UK "The decision was momentous in all respects," says one of the leading experts in offshore finance, Prof Ronen Palan of City, University of London. "They simply deemed certain transactions as not taking place in the UK. Where did the transactions take place for regulatory purposes? Nowhere.
"I think it wasn't at all by design; it was a mistake. They didn't understand the implications. It was seen as an accounting device."
The so-called "Eurodollar" was born - a global offshore financial market, transacting in dollars and allowing unlimited sums to be borrowed and lent, but under the control of no single state. No act of Parliament (or Congress) sanctioned the decision. There was no thoughtful policy-making, no careful debate.
Success of the Eurodollar
The Treasury was at first left in the dark. But within years the implications were obvious - this could revive the City of London's fortunes.
"By the time the Treasury figured it out, they thought, 'this is good business for the City'," said Prof Palan.
Banks from all around the world could borrow and lend in dollars without being subject to US tax or banking regulations - making banking in dollars more profitable out of London than out of Wall Street.
Offshore banks didn't have to hold money in reserve for every dollar they lent (as they would in the US), which would dramatically cut their costs.
While transactions were arranged in London, the lenders and borrowers could be registered anywhere. But the parties to Eurodollar transactions needed addresses.
So, zero-tax jurisdictions from the Cayman Islands to the Montserrat were used by London's investment banks as the official tax residences of their wealthy customers.
Clients could avoid both tax and undesirable scrutiny - for example from the US tax authorities.
In the British Overseas Territories, local laws were passed to attract more registration business, collecting modest fees that mounted up. No need for a bank branch out there - just a drawer in an offshore lawyer's filing cabinet.
The City of London began its recovery to become the centre of finance it is today
Howls of protest from the US government were ignored. Between 1960 and 1970, the size of the Eurodollar market went from $1bn to $46bn.
In the 1970s, countries rich in petrodollars from soaring oil prices were faced with a dilemma: repatriate the money to New York - where they would be taxed on it - or keep it offshore.
By 1980, the so-called Eurodollar market was worth more than half a trillion.
After the deregulation of the City of London in the 1986 "Big Bang", US banks joined in, setting up in London.
And as the 1990s and 2000s progressed, it became the undisputed global centre for foreign currency trading.
Not for the weather
Banks' wealthy individual and corporate clients didn't incorporate in the Cayman Islands or the British Virgin Islands because they liked the weather there - many never visited.
Offshore centres were attractive to businesses looking to reduce their tax bill, but sometimes, more importantly, to avoid what they regarded as excessive regulation.
Cayman Islands-registered companies were used heavily, for example, by the energy giant Enron as it built its business model based on fraudulent accounts.
Tax-free, light regulation jurisdictions, including the Bahamas, the Cayman Islands and Delaware in the US, became the corporate locations of choice for legitimate hedge funds.
They were also used to incorporate the vehicles at the heart of the global financial crisis - the 'structured investment vehicles' that did not show up on bank's balance sheets and bought billions of mortgage-backed securities, massively increasing the unnoticed risks in the global financial system which led to the crisis of 2008.
Likewise, the British Virgin Islands has been used by many legitimate businesses. It has also become the favourite secrecy jurisdiction for clients of the Panama-based law firm exposed in last year's Panama Papers revelations, Mossack Fonseca.
Since those revelations, governments around the world have pledged to improve transparency with measures such as automatic information sharing and registers of beneficial owners of offshore companies.
Many of those measures are yet to be enacted or tested.
But as the Paradise Papers are now confirming, the secrets of Britain's offshore empire are no longer quite so safe.
The world’s most successful secret society has been given a lesson in transparency and that is cause for celebration.
No tears need be wasted on the panjandrums who have been running the Board of Control for Cricket in India and its State associations like personal fiefdoms.
The Supreme Court finally reeled in the long rope it had given the BCCI, and so tripped up its senior officials. If there was contrition among the officials, these remained unexpressed. Yesterday’s powerhouses will be tomorrow’s forgotten men, their frown and wrinkled lip and sneer of cold command erased forever.
Inevitably, some good men will be thrown out with the bad, and there will be much churning as the old order makes way for the new. The saner elements of the board will wonder if it had to come to this, when, with greater maturity and common sense, the BCCI might have emerged with some dignity.
For the BCCI brought about its own downfall, aided by nothing more than its hubris and cavalier disregard for the laws of the land. You cannot ignore a Supreme Court judgement, as the BCCI did, and hope that nothing will change. It wasn’t just arrogance, it was foolishness of the highest order.
Would past presidents like Chinnaswamy and Sriraman, Gaekwad and Bindra, Dungarpur and Dalmiya have allowed things to come to this pass? It is convenient to believe they wouldn’t. But there is false memory at play here, a harking back to a golden era that never existed. Ghulam Ahmed, former off spinner and board vice-president, put it succinctly, “There are no values in the board.”
The Anurag Thakurs and Ajay Shirkes are paying the price for the culture that men like those mentioned had brought into the BCCI. These men ran the best sports body in the country, and somehow believed that they had a divine right to do so. Players kowtowed to them, politicians and businessmen chased them, and they clung on to power with a touching desperation.
The current dispensation extended that culture and refined it. They, like their predecessors, failed to understand the connection between actions and consequences.
At any time in the BCCI’s eight-decade history, the Supreme Court could have stepped in and ruled as it did now. Accountability and transparency were never in the BCCI’s handbook for officials, but public scrutiny was not as intense as it is now, and in some cases the good that an official did outweighed the bad, and all was forgiven.
Brinkmanship — a tactic much favoured by the BCCI to bring other cricket boards and indeed the International Cricket Council to its knees — is not a strategy guaranteed to impress the Supreme Court. That the highest court gave the BCCI more than six months to comply with its order when it could have acted even as deadlines were ignored is a testimony to its benevolence.
But how did a three-time Member of Parliament, which is what Anurag Thakur is, and sundry other luminaries, misjudge the seriousness of the situation? Was this a proxy war fought on behalf of his political masters by Thakur, or was the board, recognising the inevitable, preparing for a scorched earth response? The first will have to remain in the realm of speculation till a lead actor in the drama spills the beans. We shall soon know about the second.
The BCCI’s death wish has been one of the features of the whole saga. Thakur came in as the bright, young face of the board. There was an energy about him which makes his fall a disappointment. At 42 he was the man who replaced the old guard. Yet, within weeks, the cozy club he had tried to break up when N. Sinivasan was in charge, quickly reshaped itself into a new cozy club.
His fall is a cautionary tale for those who set out to change the system but is absorbed by it. The Supreme Court’s ruling will also impact other sports which have been resisting change like the BCCI. And that is good news for Indian sport. The domestic season has been unaffected by the BCCI’s problems. This has been the case traditionally, and is one of the true blessings of Indian cricket. There are enough dedicated officials to ensure that the show goes on.
A generational change has been forced upon the BCCI, which is otherwise happy to continue with sons and nephews (never daughters and nieces) and other relatives keeping everything in the family.
Now State associations will have to change their registrations where necessary, holding general body meetings in order to advance this. Legal procedures need to be followed. There is a temptation to believe that cricketers make the best administrators. This is a common fallacy. There are cricketers who have made excellent administrators, but being able to play the square cut is no guarantee of managerial skills. The names of corrupt cricketer-officials are well known.
There is a long road ahead, mostly uncharted. But a start has been made. The new system may not be perfect, but it is better than the old one. Accountability ensures that.
The prime minister has opened the floodgates, dragging the chancellor after him. Whatever David Cameron says, his example means all MPs will soon publish their tax returns: how dare any refuse? Feeding frenzies against politicians are not a pretty sight.
It’s a curious phenomenon that democracy is hailed as the highest human endeavour, yet its practitioners are always held in public contempt. “Elites” everywhere are in the pillory, but none more than the “elite” we elect and then despise.
Why single out politicians? The Times quotes a Conservative MP saying this will inevitably extend to “all those in public life” asking, “Where does it stop? BBC journalists, councillors, judges?” Indeed, there is no clear line between public and private people. Donors to political parties, journalists certainly, anyone in public office or with a public contract – and their partners too. There is no stopping these dominoes. Cameron in the Commons said he was against public officials having to publish tax returns, but he has broken the secrecy spell, and transparency always leads to demands for more.
Money is not a private matter. It may be almost as exciting as sex but exposing private wealth is not like publishing rude photos from private bedrooms. Who has what and from where is public because everyone must pay tax on it, even if a depleted HMRC can scrutinise very little. On death, light shines in as wills are published, but real transparency would make everyone’s tax return a public document.
The social shock would be seismic. At first people would feel as naked as if their clothes were stripped off in front of neighbours and work colleagues. Why else was Cameron so shy about revealing the scale of his wealth? He had done nothing unusual for families of his kind: it was the graphic exposure of his hundreds of thousands that made him blush. Why? Because people with inherited money know it’s not fair, they didn’t earn it and they are just lucky winners in life’s lottery.
The Daily Mail delivered a mighty full-page blast of anger against any questioning of Osborne’s £1m inheritance tax gift, which will cost the exchequer £5.8bn. Misleading as ever, they write of “most people”, and Downing Street talks of “millions of ordinary people” doing “proper tax planning” for inheritance. Yet as it is, only the super-rich pay inheritance tax, just one in 20 estates. Forget the seven-year rule, abolish this tax and instead tax recipients for all gifts they receive above a threshold over their lifetime.
The Mail warns that all this embarrassing exposure means “people with private means will no longer wish to go into public life, putting their advantages at the service of the less fortunate”. But that’s just it, these leaders with private means have harried the “less fortunate” mercilessly. They inflict billions of cuts on the poorest – in bedroom tax, benefit cap, child benefit freeze, two-child limit, and ruthless disability fit-for-work tests – while sanctions drive many into food bank destitution. The “less fortunate” may not be grateful to those with private means who rule over them. No wonder Cameron blanches at revealing his all.
Sheltering wealth, the right calls any protest against inequality “the politics of envy”. Most families still haven’t regained their pre-financial crash incomes, yet anyone with high-value property watches their assets inflate into the stratosphere. When unearned income such as Cameron’s soars but wages lag behind, anger at untaxed riches is inevitable.
Polls show people make a sharp distinction between genuine “wealth creators”, such as self-made entrepreneurs or superstars, and the trustafarians and rent-seekers who are enriched for no discernible merit. Resentment is often channelled into cynicism and sour trolling, not into political action. Will this start to change?
In Scandinavian countries, total tax transparency has helped create societies far more equal than ours. At the click of a mouse in Norway, people can find out what others own and earn, and everyone knows where they stand. Transparency stops women being paid less than men. Transparency makes employers more likely to pay themselves and their staff fairly. The culture of openness breathes an implicit belief in social justice.
But here, research from the London School of Economics’ professor John Hills shows how clueless most people are about the earnings of others, wildly underestimating British inequality. Both rich and poor delude themselves that they are far nearer the middle than they are. They know people who are better off and worse off, wrongly concluding themselves to be middling.
In my book Hard Work, I ran focus groups of the super-rich who refused to believe how much richer they were than the rest. Those with yachts envy those with a yacht and a crew, so they never feel truly rich. With the decline of unions, pay secrecy allows employers to divide and rule in the dark.
The disinfectant of sunlight makes shifty dealings and criminality much less likely, so it’s time for us to turn Norwegian. Don’t let’s strip public figures naked one by one, but let’s open the window and have every citizen’s tax return exposed. Tax works when everyone knows everyone else pays it too: I-will-if-you-will transparency is the same, all jumping in with one big splash, everyone’s income and wealth revealed together.
But don’t let gossipy obsession with personal wealth and inheritance distract from the main issue revealed in the Panama Papers. The prime task is to sweep away secrecy that allows our flotilla of tax havens to hide the world’s wealth from taxmen.
Cameron announces new rules obliging havens to answer HMRC requests for information on the beneficial owner of a company within an hour. But that’s bogus transparency, depending on occasional official requests. Tax experts say all beneficial ownership must be published openly so any investigator can check who owns what any time.
In the same way, all dealings between HMRC and companies must be published, so we can see how Google, Amazon, Facebook and myriad others escape paying what they owe. After deep cuts, HMRC needs assistance from the prying eyes of journalists, the public, company competitors and anyone who might investigate mega-avoiders.
Today Cameron’s promise fell far short of that genuine transparency. He needs to get tough with the treasure islands and follow Charles de Gaulle’s example. When Monaco refused a tax measure he requested, he forced them to surrender by surrounding the kingdom with soldiers and turning off their water supply.
It’s impossible to miss the “Hillary for Prison” signs at Trump rallies. At one of the Democratic debates, the moderator asked Hillary Clinton whether she would drop out of the race if she were indicted over her private email server. “Oh for goodness – that is not going to happen,” she said. “I’m not even going to answer that question.”
Based on what I know about the emails, the idea of her being indicted or going to prison is nonsensical. Nonetheless, the belief that Clinton is dishonest and untrustworthy is pervasive. A recent New York Times-CBS poll found that 40% of Democrats say she cannot be trusted.
For decades she’s been portrayed as a Lady Macbeth involved in nefarious plots, branded as “a congenital liar” and accused of covering up her husband’s misconduct, from Arkansas to Monica Lewinsky. Some of this is sexist caricature. Some is stoked by the “Hillary is a liar” videos that flood Facebook feeds. Some of it she brings on herself by insisting on a perimeter or “zone of privacy” that she protects too fiercely. It’s a natural impulse, given the level of scrutiny she’s attracted, more than any male politician I can think of.
I would be “dead rich”, to adapt an infamous Clinton phrase, if I could bill for all the hours I’ve spent covering just about every “scandal” that has enveloped the Clintons. As an editor I’ve launched investigations into her business dealings, her fundraising, her foundation and her marriage. As a reporter my stories stretch back to Whitewater. I’m not a favorite in Hillaryland. That makes what I want to say next surprising.
The yardsticks I use for measuring a politician’s honesty are pretty simple. Ever since I was an investigative reporter covering the nexus of money and politics, I’ve looked for connections between money (including campaign donations, loans, Super Pac funds, speaking fees, foundation ties) and official actions. I’m on the lookout for lies, scrutinizing statements candidates make in the heat of an election.
The connection between money and action is often fuzzy. Many investigative articles about Clinton end up “raising serious questions” about “potential” conflicts of interest or lapses in her judgment. Of course, she should be held accountable. It was bad judgment, as she has said, to use a private email server. It was colossally stupid to take those hefty speaking fees, but not corrupt. There are no instances I know of where Clinton was doing the bidding of a donor or benefactor.
As for her statements on issues, Politifact, a Pulitzer prize-winning fact-checking organization, gives Clinton the best truth-telling record of any of the 2016 presidential candidates. She beats Sanders and Kasich and crushes Cruz and Trump, who has the biggest “pants on fire” rating and has told whoppers about basic economics that are embarrassing for anyone aiming to be president. (He falsely claimed GDP has dropped the last two quarters and claimed the national unemployment rate was as high as 35%).
I can see why so many voters believe Clinton is hiding something because her instinct is to withhold. As first lady, she refused to turn over Whitewater documents that might have tamped down the controversy. Instead, by not disclosing information, she fueled speculation that she was hiding grave wrongdoing. In his book about his time working in the Clinton White House, All Too Human, ABC’s George Stephanopoulos wrote that failing to convince the first lady to turn over the records of the Arkansas land deal to the Washington Post was his biggest regret.
The same pattern of concealment repeats itself through the current campaign in her refusal to release the transcripts of her highly paid speeches. So the public is left wondering if she made secret promises to Wall Street or is hiding something else. The speeches are probably anodyne (politicians always praise their hosts), so why not release them?
Colin Diersing, a former student of mine who is a leader of Harvard’s Institute of Politics, thinks a gender-related double standard gets applied to Clinton. “We expect purity from women candidates,” he said. When she behaves like other politicians or changes positions, “it’s seen as dishonest”, he adds. CBS anchor Scott Pelley seemed to prove Diersing’s point when he asked Clinton: “Have you always told the truth?” She gave an honest response, “I’ve always tried to, always. Always.” Pelley said she was leaving “wiggle room”. What politician wouldn’t?
Clinton distrusts the press more than any politician I have covered. In her view, journalists breach the perimeter and echo scurrilous claims about her circulated by unreliable rightwing foes. I attended a private gathering in South Carolina a month after Bill Clinton was elected in 1992. Only a few reporters were invited and we sat together at a luncheon where Hillary Clinton spoke. She glared down at us, launching into a diatribe about how the press had invaded the Clintons’ private life. The distrust continues.
These are not new thoughts, but they are fundamental to understanding her. Tough as she can seem, she doesn’t have rhino hide, and during her husband’s first term in the White House, according to Her Way, a critical (and excellent) investigative biography of Clinton by Jeff Gerth and Don Van Natta, she became very depressed during the Whitewater imbroglio. A few friends and aides have told me that the email controversy has upset her as badly.
Like most politicians, she’s switched some of her positions and sometimes shades the truth. In debates with Sanders, she cites her tough record on Wall Street, but her Senate bills, like one curbing executive pay, went nowhere. She favors ending the carried interest loophole cherished by hedge funds and private equity executives because it taxes their incomes at a lower rate than ordinary income. But, according to an article by Gerth, she did not sign on to bipartisan legislation in 2007 that would have closed it. She voted for a bankruptcy bill favored by big banks that she initially opposed, drawing criticism from Elizabeth Warren. Clinton says she improved the bill before voting for passage. Her earlier opposition to gay marriage, which she later endorsed, has hurt her with young people. Labor worries about her different statements on trade deals.
Still, Clinton has mainly been constant on issues and changing positions over time is not dishonest.
It’s fair to expect more transparency. But it’s a double standard to insist on her purity.
Doctors are fallible; of course they are. So why do they find this so hard to admit, and how can they work more openly? Atul Gawande lifts the veil of secrecy in the first of his Reith lectures
Every family has its pivotal medical moments. One of ours was in July 1995 when my son Walker was just 11 days old. He had difficulty taking his feeds, he couldn’t hold anything down, and we took him to the paediatrician. The paediatrician put her stethoscope on his chest, listened for a moment, and then looked at us and said: “There’s something wrong with his heart.” She told us to take him to hospital right away.
Millions of moments like this occur every day: a human being coming to another human being with the body or mind’s troubles and looking for assistance. That is the central act of medicine – that moment when one human being turns to another human being for help.
And it has always struck me how small and limited that moment is. We have 13 different organ systems and at the latest count we’ve identified more than 60,000 ways that they can go awry. The body is scarily intricate, unfathomable, hard to read. We are these hidden beings inside this fleshy sack of skin and we’ve spent thousands of years trying to understand what’s going on inside. To me, the story of medicine is the story of how we deal with the incompleteness of our knowledge and the fallibility of our skills.
There was an essay that I read two decades ago that I think has influenced almost every bit of writing and research I’ve done ever since. It was by two philosophers – Samuel Gorovitz and Alasdair MacIntyre – and their subject was the nature of human fallibility. They wondered why human beings fail at anything that we set out to do. Why, for example, would a meteorologist fail to correctly predict where a hurricane was going to make landfall, or why might a doctor fail to figure out what was going on inside my son and fix it? They argued that there are two primary reasons why we might fail. The first is ignorance: we have only a limited understanding of all of the relevant physical laws and conditions that apply to any given problem or circumstance. The second reason, however, they called “ineptitude”, meaning that the knowledge exists but an individual or a group of individuals fail to apply that knowledge correctly.
A surgeon in theatre.Photograph: Sam Edwards/Getty Images
We’ve relied on science to overcome ignorance, and the course of that work has itself been fascinating. That visit we made in 1995 to our paediatrician and everything that she did to sort out what was happening in my son could be traced back to 1628 when the English physician William Harvey, after millennia of ignorance, finally worked out that the heart is a pump that moves blood in a circular course through the body.
Another critical step came three centuries later, in 1929, when Werner Forssmann, a surgical intern in Eberswalde, Germany, made an observation. Forssmann was reading an obscure medical journal when he noticed an article depicting a horse in which researchers had threaded a long tube up its leg all the way into its heart. They described, to his amazement, taking blood samples from inside a living heart without harm. And he said: “Well, if we could do that to a horse, what if we did that to a human being?” Forssmann went to his superiors and said: “How about we take a tube and thread it into a human being’s heart?”
Their response was, in essence, “You’re crazy. You can’t do that. Whenever anyone touches the heart in surgery, it goes into fibrillation and the patient dies.”
He said: “Well what about in an animal?”
And they said: “There’s no point and you’re just an intern anyway. Who says you should even deserve to get to ask these questions? Go back to work.”
But Forssmann just had to give it a try. So he stole into the x-ray room, took a urinary catheter, made a slit in his own arm, threaded it up his vein and into his own heart and convinced a nurse to help him take a series of nine x-rays showing the tube inside his own heart.
He published the evidence – and was fired. Then in 1956, he was awarded the Nobel prize in medicine with André Cournand and Dickinson Richards who, some 20 years later at Columbia University, had taken Forssmann’s findings and recognised that you could not only put a catheter into the human heart but also shoot dye through the catheter. That enabled them to take pictures and see from the inside how the heart actually worked. Together the three had founded the field of cardiology. After this, doctors began devising ways to fix what was found going wrong inside the heart.
Science is concerned with universal truths, laws of how the body or the world behaves. Application, however, is concerned with the particularities, and the test of the science is how the universalities apply to the particularities. Do the general ideas about the worrying sounds the paediatrician heard in my son’s chest correspond with the unique particularities of Walker? Here Gorovitz and MacIntyre saw a third possible kind of failure. Besides ignorance, besides ineptitude, they said that there is necessary fallibility, some knowledge science can never deliver on. They went back to the example of how a given hurricane will behave when it makes landfall, how fast it will be going when it does, and what they said is that we’re asking science to do more than it can when we ask it to tell us what exactly is going on. All hurricanes follow predictable laws of behaviour but no hurricane is like any other hurricane. Each one is unique. We cannot have perfect knowledge of a hurricane, short of having a complete understanding of all the laws that describe natural processes and a complete description of the world, they said. It required, in other words, omniscience, and we can’t have that.
The interesting question, then, is how do we cope? It’s not that it’s impossible to predict anything. Some things are completely predictable. Gorovitz and MacIntyre gave the example of a random ice cube in a fire. An ice cube is so simple and so similar to other ice cubes that you can have complete assurance that if you put it in the fire, it will melt. Our puzzle is: are human beings more like hurricanes or more like ice cubes?
Following the paediatrician’s instructions, we took Walker to the emergency room. It was a Sunday morning. A nurse took an oxygen monitor, one of those finger probes with the red light, and put it on the finger of his right hand. And the oxygen level was 98%, virtually perfect. They took a chest x-ray, and it showed that the lungs were both whited out. They read it. They said: “This is pneumonia.” They did a spinal tap to make sure that it wasn’t signs of infection that had spread from meningitis. They started him on antibiotics and they called the paediatrician to let her know the diagnosis they’d found. It wasn’t the heart, they said. It was the lungs. He had pneumonia. And she said: “No, that can’t be right.” She came into the emergency room and she took one look at him – he was having trouble breathing, he was not doing great – and she saw that the finger probe with the oxygen monitor was on the wrong finger.
It turns out there are certain conditions in which the aorta can be interrupted. You can be born with an incomplete aorta and so the blood flow can come out of the heart and go to the right side of the upper body, into the hand that had that probe, but it may not go to the left side of the upper body or anywhere else. And that turned out to be what was going on. She switched the probe over to the left hand and he had an unreadable oxygen level. He was in fact going into kidney and liver failure. He was in serious trouble. She had caught a failure to apply the knowledge science has to this particular situation.
Then the team made a prediction. In this circumstance, we do have a drug – only put into use, it turned out, about a decade before my son was born: prostaglandin E2, a little molecule that can reopen the foetal circulation. When you’re a foetus in the womb, you have a bypass system that sends a separate blood supply that can stay open for a couple of weeks after birth. This system had shut down and that’s why he went into failure. But this molecule can reopen that pathway and the prediction was that this child was like every other child – that you could know what had happened to other children and could apply it here and that it would open up that foetal circulation, this bypass system. And it did. That gave him time to recover in the intensive care unit, to let his kidney and his liver recover, to let his gut start working again, and then to undergo cardiac surgery to replace his malformed aorta and to fix the holes that were present in his heart as well. They saved him.
They saved him.
There are more and more ways in which we are as knowable as ice cubes. We understand with great precision how mothers can die in childbirth, how certain tumours behave, how the Ebola virus spreads, how the heart can go wrong and be fixed. Certainly, we have many, many areas of continuing ignorance – how to stop Alzheimer’s disease or metastatic cancers, how we might make a vaccine against this virus we’re dealing with now. But the story of our time, I think, is as much a story about struggling with ineptitude as struggling with ignorance.
You go back a hundred years or more, and we lived in a world where our futures were governed largely by ignorance. But over this last century, we’ve come through an extraordinary explosion of discovery. The puzzle has, therefore, become not only how we close the gaps of ignorance open to us, but also how we ensure that the knowledge gets through, that the finger probe is on the correct finger.
Next to my son, in the intensive care unit, there was a child from Maine, which is about 200 miles away, who had virtually the same diagnosis that Walker had. And when this boy was diagnosed, it took too long for the problem to be recognised, for transportation to be arranged, and for him to get that drug to give him back that open circulation. The result was that the poor child with the same condition my son had, in the very next bed to ours, gone into complete liver and kidney failure, and his only chance was to wait for an organ transplant and hope for a future that was going to be very different from the one my son was going to have.
And then I think back on my family. My parents come from India; my father from a rural village, my mother from a big city in the north. If Walker had been anything like my nieces and nephews in the village where my family still farms – they’re farmers growing wheat and sugarcane and cotton – and if he’d been there, there would have been no chance at all.
There’s a misconception about global health. We think global health is about care in just the poorest parts of the world. But the way I think about global health, it’s about making care better everywhere – the idea that we are trying to deploy the capabilities that we have discovered over the last century, town by town, to every person alive. We’ve had an extraordinary transformation around the world. Economically, even with the last recession, we’ve had the rising of global economies on every continent and the result has been a dramatic change in the length of lives all across the world. Respiratory illness and malnutrition used to be the biggest killers. Now it’s cardiovascular disease; road traffic accidents are a top five killer and cancers are in the top 10. With economic progress has come the broader knowledge for people that solutions exist.
My family members in our village in India know that solutions exist to the problems they have, and so the puzzle is how we deploy that capability everywhere – in India, in Maine, across the UK, Europe, Latin America, the world. We’re only just discovering the patterns of how we begin to do that.
In the course of this year’s Reith lectures, I’m going to attempt to unpack three ideas. First is what we’re learning from opening the door, from seeing behind the curtains of how medicine and public health are actually practised and discovering how much can be done better that saves lives and reduces suffering. Second is the reality of our necessary fallibility and how we cope effectively with the fact that our knowledge is always limited. Third, I will consider the implications of both of these – the implications of what we’re learning about our ineptitude and about our necessary fallibility – for the global future of medicine and health.
It is uncomfortable looking inside our fallibility. We have a fear of looking. We’re like the doctors who dug up bodies in the 19th century to dissect them, in order to know what was really happening inside. We’re looking inside our systems and how they really work. And like before, what we find is messier than we knew and sometimes messier than we might have wanted to know.
In some ways, turning on the cameras inside our world can be more treacherous. There’s a reason that Gorovitz and MacIntyre labelled the kind of failures we have “ineptitude”. There’s a sense that there’s some shame or guilt attached to the fact that we don’t get it right all the time. And exposing this reality can make people more angry than exposing the reality of how the body works. Therefore, we’ve blocked many of these efforts to try to provide some transparency to what’s going on. Audiotapes are often not allowed, the video recorders are turned off. We have no black box for what happens in our operating rooms or in our clinics. The data, when we have it, is often locked up. You can’t know, even though we have the information, which hospitals have a better complication rate in certain kinds of operations than others. There’s a fear of misuse, a fear of injustice in doing it, in exposing it.
The Agnew Clinic by Thomas Eakins.Photograph: Universal History Archive via Getty Images
Arguably, not opening up the doors puts lives at stake. What we find out can often be miraculous. By closing ourselves off, we’re missing important opportunities.
The doctors told us when Walker went home that he was going to need a second operation. The repair that he’d had was one that replaced a section of his aorta – the tube coming out of his heart to carry blood supply throughout the rest of the body – with an artificial tube when he was 11 days old. It was almost like a straw. Now they had designed it to expand a bit as he grew, but it was not going to accommodate an adult-sized body. So they told us that when he became a teenager he would have to get a new replacement aorta and that he would have to undergo a major operation. Being a surgery resident, I knew what that entailed. Repeat aortic surgery has up to a 5% chance of death and a 25% chance of paralysis. We lived in some fear about when that moment would come.
When that moment came, he was 14 years old, and the world had changed. By then technology had developed to allow his aorta to be expanded with a simple catheter. We found the expert who had learned, and even devised, some of the methods for being able to do that, in Boston. He explained to me, cardiologist to surgeon, just how it’s done and sometimes you learn stuff you don’t necessarily want to know. He talked about how he would have to apply pressure to a balloon that would be threaded up inside the aorta. I asked how he knew what pressure to apply. He said it was by feel. He could feel the vessel tearing, and the trick was to tear it just enough that it can expand but not so much that it ruptures.
There was a necessary fallibility in what he was attempting to do – some irreducible probability of failure. But Walker got through that procedure just fine. The extraordinary thing was the very next day he went home, and the day after that he was so well that he played sports and injured his ankle on the playing field. This June he graduated from high school and this autumn he started college. He’s going to live a long and normal life, and that is amazing. The key question we have to ask ourselves is how are we going to make it possible for others to have that, how do we fulfil our duty to make it possible for others? The only way I can see is by removing the veil around what happens in that procedure room, in that clinic, in that office or that hospital. Only by making what has been invisible visible. This is why I write, this is why we do the science we do – because this is how we understand – and that is the key to the future of medicine.
Image copyrightREUTERSImage captionThe Bank of England did not get its way against the Treasury
