Britain is over-tolerant of monopolies

Jonathan Ford in The Financial Times


The old joke that asks why there is only one Monopolies Commission may no longer work now the watchdog has rechristened itself the Competition and Markets Authority. 

But perhaps it’s no coincidence that the UK’s trustbusters have dropped the word “monopoly” from their name. 

Contemporary Britain can seem oddly complacent in the face of declining competition. True, it is not the only country to face the uncomfortable concentrations of market power that new technology and global capital make possible. 

Many advanced economies struggle with the “winner takes all” nature of the internet. 

Large parts of the UK’s competition mechanism are in any case delegated to Brussels. But even so, the country often contrives to drop the trustbusting ball. 

Take the ongoing dispute between Transport for London and Uber over whether the car-booking service should retain its taxi licence. 

TfL is up in arms about safety standards. But the real scandal here is the way Uber has been allowed to hoover up the London taxi market.  

Almost unseen, the US company has been able to turn a price-regulated black cab monopoly into an unregulated one where it increasingly dominates the capital’s streets. 

Facts on market shares are hard to obtain, in part because of Uber’s un-transparent structure. 

Fares for its services are paid not to a UK company, but to a Netherlands vehicle, which remits only sufficient money to the UK subsidiary to cover its costs and pay vestigial amounts of tax. 

Nonetheless, it is clear that Uber has built a very substantial position in the five years since it received a licence, the only app-based service yet to do so. 

The service has 40,000 drivers on its network, four times the number of black cab drivers. The second largest non-black cab private hire operator in London, Addison Lee, has just 4,800 drivers on its books. 

Compare that, for instance, to supposedly highly regulated Paris. There, customers have a choice of numerous app-based services, including Uber, Taxify, Allocab and Le Cab, as well as traditional regulated taxis. 

Travis Kalanick, Uber’s founder, may talk about London as the “Champion’s League of transportation”. But it is also one of the company’s top three cities worldwide in terms of profitability. Unsurprisingly, perhaps, given that in this “competition”, the authorities have excluded its main rivals. 

Other app-based services such as Taxify have been unable so far to obtain licences. Perhaps Uber has been treated as a guinea pig by the regulators. But if so, that careless decision may have allowed it to steal an uncatchable head start. 

Taxis are not the only area where competition has been allowed to take a back seat. Take the concentration of market power that occurred in the banking sector after the financial crisis, largely prompted by the merger of Lloyds TSB and HBOS. 

The CMA has placed its faith in limp behavioural remedies and backed away from any muscular changes such as break-ups. 

Or the telecoms sector, where the regulator allowed BT, the old national network, to buy EE and create a preponderant mobile operator without proposing any material steps to redress its evident market power. 

A recent study by the Social Market Foundation shows how the cumulative effect of market concentration increasingly threatens consumers’ interests. 

Out of 10 key markets accounting for 40 per cent of consumer spending, it found that eight — including groceries, mobile phones, gas and current accounts — were concentrated, meaning they were dominated by a small number of large companies. 

Only the car industry and the mortgage market were genuinely open, with no single operator in the former sector controlling more than 15 per cent of the market. Meanwhile, in telephone landlines, BT has about 80 per cent. 

Concentration and competition are not the same thing. In some sectors, such as groceries, it can be possible to have both because of the ease of switching. 

But in many sectors the concentrated market power erodes competition to the detriment of consumers. 

The lack of competition in banking, for instance, costs customers £6bn a year, or £116 each, according to a competition inquiry in 2016. In the energy sector, another inquiry found that Britons are paying £1.7bn too much each year for their power. Despite official investigations galore, neither has been addressed. 

Like the famous line about empire, Britain appears to be acquiring oligopolies in a fit of absence of mind. It is a dangerous inattention. 

For these concentrations do not just hit consumers in the wallet. They exact a cost in terms of public loss of confidence in private business and free markets. A state that believed in either would bust more trusts.

Bonuses are the enemy of progress

Andrew Hill in The Financial Times



When my children were still in primary school, I once let my English stiff upper lip slacken and asked them whether I had ever said how much I loved them. “Yes,” responded my truculent son, “but not with money.” 

I am reminded of his precocious attempt to persuade me to apply hard cash to a soft problem every time I hear about efforts to use monetary bonuses to encourage executives to hit non-financial goals. 

Reduced emissions, safer factories, better gender balance: companies everywhere are enshrining such creditable objectives as “key performance indicators”, putting a price on the target, and letting greed take care of the rest. 

“I think we’ve got to do more to tie the outcomes to compensation, so that it’s meaningful and it’s real,” declared Alexis Herman, a former US labour secretary and Coca-Cola board member, at the recent Women’s Forum for the Economy & Society in Paris, discussing how businesses can become more “human”. 

More than once I heard delegates suggest similar solutions in similar terms. The argument went like this: make bonuses dependent on progress, particularly on diversity, because bonuses are “the only language executives understand”. 

In that case, it is about time executives learnt another language, because at the highest level, bonus-based pay packages are a mess. 

Indeed, there is something perverse about suggesting that companies should hammer away at the vital, sensitive question of how to improve their environmental, social and governance performance using a blunt instrument — the cash bonus — that has helped deepen mistrust of business, and widen inequality. 

When misused, monetary bonuses foster selfishness, backbiting, even cheating among employees. Staff who start taking bonuses for granted become resentful if the cash is withdrawn, as banks that have tried to rein in such rewards since the financial crisis have discovered. When bonus packages are too complex, evidence suggests that managers simply ignore the targets altogether. 

Adding non-financial goals undeniably complicates what is already a baffling array of executive incentives. Measuring how managers have performed against softer targets is also notoriously hard. That is one reason why, at board level, directors seem to have wide discretion to adjust chief executives’ bonuses for non-financial performance. 

Coca-Cola, for example, assessed the 2016 performance of its then chief executive, Muhtar Kent, on no fewer than six strategic initiatives — “People, Planet, Productivity, Partners, Portfolio and Profit”. To decide his bonus, the compensation committee took account not only of his efforts to refranchise US bottling operations, but also to replenish water, reduce sugar and accelerate diversity. 

I would question whether Mr Kent pondered for long the impact on his pay of the many non-financial decisions he took. Most of his eventual bonus of $4.1m (out of a total package of $16m), was the outcome of a formula based on financial results rather than other worthy actions. 

Leaders should do their best to encourage and harness workers’ love of the job. But cash bonuses can get in the way of this intrinsic motivation to do the right thing. 

Ioannis Ioannou, Shelley Xin Li and George Serafeim have studied attempts to meet demanding carbon emission targets.They found using stretch goals alone was quite effective. But adding monetary incentives seemed to undermine companies’ ability to hit the ambitious targets. 

Not to say that incentives are worthless. BHP Billiton, the miner, is making progress towards its demanding goal of achieving gender balance by 2025, helped by the fact that bonuses for senior staff are tied to advances towards the objective. Prof Ioannou of London Business School says bonuses spurred on managers whose job description already included cleaning up emissions. 

Still, I am queasy about offering cash rewards for good intentions that should be the norm. I don’t like promising cash incentives to my children for excellent exam results, either, let alone for loading the dishwasher or vacuuming their bedrooms. 

As Nobel-winning economist Richard Thaler wrote in Misbehaving, it is “overly simplistic” to assume that financial incentives to children (or their parents or teachers) will improve performance. Likewise for many subtler corporate objectives. 

In fact, I fear the main effect of focusing executives’ attention on cash bonuses for being cleaner, safer or more inclusive will be to remind them that the most “meaningful and real” rewards are available for the headlong pursuit of pure profit.

How the oligarchy wins

Ganesh Sitaraman in The Guardian

A few years ago, as I was doing research for a book on how economic inequality threatens democracy, a colleague of mine asked if America was really at risk of becoming an oligarchy. Our political system, he said, is a democracy. If the people don’t want to be run by wealthy elites, we can just vote them out.

The system, in other words, can’t really be “rigged” to work for the rich and powerful unless the people are at least willing to accept a government of the rich and powerful. If the general public opposes rule-by-economic-elites, how is it, then, that the wealthy control so much of government?

The question was a good one, and while I had my own explanations, I didn’t have a systematic answer. Luckily, two recent books do. Oligarchy works, in a word, because of institutions.

In his fascinating and insightful book Classical Greek Oligarchy, Matthew Simonton takes us back to the ancient world, where the term oligarchy was coined. One of the primary threats to oligarchy was that the oligarchs would become divided, and that one from their number would defect, take leadership of the people, and overthrow the oligarchy.

To prevent this occurrence, ancient Greek elites developed institutions and practices to keep themselves united. Among other things, they passed sumptuary laws, preventing extravagant displays of their wealth that might spark jealously, and they used the secret ballot and consensus building practices to ensure that decisions didn’t lead to greater conflict within their cadre.

Appropriately for a scholar of the classics, Simonton focuses on these specific ancient practices in detail. But his key insight is that elites in power need solidarity if they are to stay in power. Unity might come from personal relationships, trust, voting practices, or – as is more likely in today’s meritocratic era – homogeneity in culture and values from running in the same limited circles.

While the ruling class must remain united for an oligarchy to remain in power, the people must also be divided so they cannot overthrow their oppressors. Oligarchs in ancient Greece thus used a combination of coercion and co-optation to keep democracy at bay. They gave rewards to informants and found pliable citizens to take positions in the government.

These collaborators legitimized the regime and gave oligarchs beachheads into the people. In addition, oligarchs controlled public spaces and livelihoods to prevent the people from organizing. They would expel people from town squares: a diffuse population in the countryside would be unable to protest and overthrow government as effectively as a concentrated group in the city.

They also tried to keep ordinary people dependent on individual oligarchs for their economic survival, similar to how mob bosses in the movies have paternalistic relationships in their neighborhoods. Reading Simonton’s account, it is hard not to think about how the fragmentation of our media platforms is a modern instantiation of dividing the public sphere, or how employees and workers are sometimes chilled from speaking out.

The most interesting discussion is how ancient oligarchs used information to preserve their regime. They combined secrecy in governance with selective messaging to targeted audiences, not unlike our modern spinmasters and communications consultants. They projected power through rituals and processions.
At the same time, they sought to destroy monuments that were symbols of democratic success. Instead of public works projects, dedicated in the name of the people, they relied on what we can think of as philanthropy to sustain their power. Oligarchs would fund the creation of a new building or the beautification of a public space. The result: the people would appreciate elite spending on those projects and the upper class would get their names memorialized for all time. After all, who could be against oligarchs who show such generosity?

An assistant professor of history at Arizona State University, Simonton draws heavily on insights from social science and applies them well to dissect ancient practices. But while he recognizes that ancient oligarchies were always drawn from the wealthy, a limitation of his work is that he focuses primarily on how oligarchs perpetuated their political power, not their economic power.

To understand that, we can turn to an instant classic from a few years ago, Jeffrey Winters’ Oligarchy. Winters argues that the key to oligarchy is that a set of elites have enough material resources to spend on securing their status and interests. He calls this “wealth defense,” and divides it into two categories. “Property defense” involves protecting existing property – in the old days, this meant building castles and walls, today it involves the rule of law. “Income defense” is about protecting earnings; these days, that means advocating for low taxes.

The challenge in seeing how oligarchy works, Winters says, is that we don’t normally think about the realms of politics and economics as fused together. At its core, oligarchy involves concentrating economic power and using it for political purposes. Democracy is vulnerable to oligarchy because democrats focus so much on guaranteeing political equality that they overlook the indirect threat that emerges from economic inequality.

Winters argues that there are four kinds of oligarchies, each of which pursues wealth defense through different institutions. These oligarchies are categorized based on whether the oligarchs rule is personal or collective, and whether the oligarchs use coercion.

Warring oligarchies, like warlords, are personal and armed. Ruling oligarchies like the mafia are collective and armed. In the category of unarmed oligarchies, sultanistic oligarchies (like Suharto’s Indonesia) are governed through personal connections. In civil oligarchies, governance is collective and enforced through laws, rather than by arms.



Democracy defeated oligarchy in ancient Greece because of 'oligarchic breakdown.'


With this typology behind him, Winters declares that America is already a civil oligarchy. To use the language of recent political campaigns, our oligarchs try to rig the system to defend their wealth. They focus on lowering taxes and on reducing regulations that protect workers and citizens from corporate wrongdoing.

They build a legal system that is skewed to work in their favor, so that their illegal behavior rarely gets punished. And they sustain all of this through a campaign finance and lobbying system that gives them undue influence over policy. In a civil oligarchy, these actions are sustained not at the barrel of the gun or by the word of one man, but through the rule of law.

If oligarchy works because its leaders institutionalize their power through law, media, and political rituals, what is to be done? How can democracy ever gain the upper hand? Winters notes that political power depends on economic power. This suggests that one solution is creating a more economically equal society.
The problem, of course, is that if the oligarchs are in charge, it isn’t clear why they would pass policies that would reduce their wealth and make society more equal. As long as they can keep the people divided, they have little to fear from the occasional pitchfork or protest.
Indeed, some commentators have suggested that the economic equality of the late 20th century was exceptional because two World Wars and a Great Depression largely wiped out the holdings of the extremely wealthy. On this story, there isn’t much we can do without a major global catastrophe.

Simonton offers another solution. He argues that democracy defeated oligarchy in ancient Greece because of “oligarchic breakdown.” Oligarchic institutions are subject to rot and collapse, as are any other kind of institution. As the oligarchs’ solidarity and practices start to break down, there is an opportunity for democracy to bring government back to the people.

In that moment, the people might unite for long enough that their protests lead to power. With all the upheaval in today’s politics, it’s hard not to think that this moment is one in which the future of the political system might be more up for grabs than it has been in generations.

The question is whether democracy will emerge from oligarchic breakdown – or whether the oligarchs will just strengthen their grasp on the levers of government.

What the grim reality of a ‘bad-tempered’ Brexit means

Toby Helm in The Guardian


A little over a year ago, David Davis was confident that Brexit Britain would soon strike new trade deals across the world. They could be negotiated and agreed without the difficulties and delays of which Remainers warned. All parts of the global trade jigsaw would fall quickly and neatly into place. “So be under no doubt,” the Brexit secretary wrote in an article for the ConservativeHome website in July 2016, “we can do deals with our trading partners, and we can do them quickly... I would expect that the negotiation phase of most of them to be concluded within between 12 and 24 months. Trade deals with the US and China alone will give us a trade area almost twice the size of the EU, and of course we will also be seeking deals with Hong Kong, Canada, Australia, India, Japan, the UAE, Indonesia – and many others.”

Around the same time, international trade secretary Liam Fox predicted that a free-trade deal with the EU, giving us continued access to EU markets after Brexit, “should be one of the easiest in human history”. His fellow Tory, the hardline Eurosceptic John Redwood, also saw no problems in realising this great reconfiguration of British interests around the world. “Getting out of the EU can be quick and easy – the UK holds most of the cards in any negotiation,” he declared.

This weekend, 16 months on from Leave’s narrow referendum win, the talk is no longer of quick deals, or smooth routes out. Instead, Theresa May and her cabinet are preparing the country for the possibility of “no deal” at all being reached with Brussels before the UK leaves at the end of March 2019. No deal would also mean no two-year transition of the kind that May said would be so important in her recent Florence speech. Many of the hardline Brexiters have changed their tune, and now cheer on the prospect of “no deal” as the only way to break free. None of the trade deals they envisaged have been done and none are in sight. (It is not possible to enter into them until we leave the customs union).

The EU is refusing even to begin to talk about post-Brexit trade arrangements with the UK because other issues, such as the divorce bill for leaving, are still deadlocked. In the House of Commons on Monday, May confirmed that negotiations, rather than progressing, had stalled and reality was dawning. She told MPs that “while it is profoundly in all our interests for the negotiations to succeed, it is also our responsibility as a government to prepare for every eventuality, so that is exactly what we are doing”. By which she meant: “Get ready for no deal”.

  Brexit secretary David Davis: not making much progress in negotiations, contrary to expectations. Photograph: Dominic Lipinski/PA

In evidence to the Treasury select committee on Wednesday, chancellor Philip Hammond declared that the possible “no deal” outcome could come about in one of two ways. The first would be quite friendly. But the other would involve a “bad-tempered breakdown”.

“If it is [that we move to] a World Trade Organisation regime with no deal, there are then two further potential levels that you have to consider. One is no deal – WTO – but a friendly agreement that we are not going to reach a deal, but we will work together to cooperate to make things run as smoothly as possible,” Hammond said.

“But, bluntly, we also have to consider the possibility of a bad-tempered breakdown in negotiations where we have non-cooperation, and, worst-case scenario, even a situation where people are not necessarily acting in their own economic self-interest. So we need to prepare for a wide range of scenarios.”

That sounded like an ugly trade war. Hammond insisted it was too early for him to be committing hundreds of millions of pounds to preparations for this “no deal” scenario – as hardline Brexiters were saying he now should – only to be slapped down hours later by May, who told MPs that £250m was being allocated to government departments to help do just that. The cabinet – split from top to bottom about what kind of Brexit deal it wants – was even split about whether, and how, to prepare for the potentially disastrous outcome of not getting an EU deal at all.

If there is no UK-EU deal before March 2019, the consequences would be huge and immediate. The return of customs checks would mean a return to the hard border between Northern Ireland and the republic. For trade, the UK would default to WTO rules, meaning tariffs would be imposed on goods leaving the UK for the EU and on those sold into the UK market by the remaining 27 member states. The government has said it wants the continuation of “frictionless” trade with EU countries. But a WTO regime would, by contrast, mean tariffs of between 2% and 3% on many industrial goods. They would be far higher in others sectors: 10% for cars and 20% to 40% for many agricultural products. The British Chambers of Commerce and other business groups are warning that some British companies will consider moving abroad and that investment in the UK could suffer.

Hammond said last week that there was also a prospect of flights between UK and EU airports being grounded as the UK would no longer fall inside the EU’s aviation regulatory regime. The right of EU nationals to stay in the UK could also disappear, as would those of UK citizens living in EU countries.

The hard-Brexit supporting right wing of the Tory party was arguing only a year ago that Brexit would be relatively smooth and simple. Now that it has proved to be anything but, and talks with Brussels have hit the buffers, many of them are encouraging this “no deal” option as somehow a pure form of Brexit. It means a clean break. They blame the EU and the Remainers for blocking the way to the kind of future they sold to the British people as possible and desirable before the Brexit referendum last year.

The big question now is whether the public take the same attitude, or begin to coalesce more around the view that “no deal” is a very bad deal for them.

Will jobs be lost?

Tens of thousands of jobs are linked to seamless trade with the European Union. Multinational firms fly staff to Ireland, France, Germany and the low countries without interference from border control officials.

Then there is the example of the crankshaft used in the BMW Mini, which crosses the Channel three times in a 2,000-mile journey before the finished car rolls off the production line. It is one of the classic trips made by hundreds of car parts that would be stopped at the border in the event of a no-deal Brexit.

Northern Ireland would be one of the worst-affected regions, as food manufacturers use ingredients from south of the border and sell the final product in the republic too.

The CBI gives the example of a Northern Irish bread-maker that buys flour from Ireland, makes the product in the north, and then transports bread to Dublin. Even if the UK continues to recognise the EU HGV licence used by the Polish driver (for example) and the EU food standards that determine the bread’s shelf life, after Brexit the loaf could be inedible by the time it has reached its destination or so expensive that local bakeries quickly step in and win the day.

Nissan is among the carmakers to say that they have already started getting their parts from the UK to offset the effects of a hard Brexit that involves restrictions on immigrant labour and tight border controls. But its scenario-planning cannot cope without a deal of some sort.

 Unemployment could be pushed up by the loss of ‘frictionless’ trade with the EU. Photograph: Oli Scarff/Getty Images

Will I be able to take out cash abroad?

Banks were among the first to plan for a hard Brexit that might deny them the “passporting” rights that allow money transfers and derivatives transactions to happen seamlessly across borders.

The last year has seen a succession of UK banks and insurers set up offshoots in what will remain of the EU, allowing them to bypass Britain if they need to. Foreign banks that have based their European HQs in London have done likewise.

This level of contingency planning means that it is most likely that British travellers will be able to withdraw funds abroad and transfer money the day after Brexit, whatever the outcome. But a last-minute decision to crash out of the EU is likely to send the pound tumbling, meaning that Brits abroad will find the ATM gives them a fraction of what they expected. And there could be extra charges to compensate for the higher administration costs faced by banks.

Other service industries are unlikely to be quite as prepared, even though they collectively account for 40% of EU trade, up from 23% in 1999. And to show its importance to UK firms, this rise of almost a quarter compares with a 6% increase in non-EU trade over the same time period.

The CBI says: “Exports of business services, such as design, advertising and architecture, together with financial services, account for over half of the UK’s overall growth in services exports.And these sectors may be particularly vulnerable to a sudden re-emergence of trade barriers with the EU.”


Will planes still fly?

Ask Ryanair’s chief executive, Michael O’Leary, and the answer will be no. He says that without a deal at least six months before the March 2019 deadline, there will be chaos at British airports.

O’Leary said at best he would need to place “health warnings” on flights. At worst he will be forced to rejig routes so that they bypass UK airports altogether.

“If Britain gets pushed out of the EU, it is absolutely the legal position that flights must stop. You’ve got to negotiate that bilaterally,” he has said. “If we don’t know the legal basis for which they’re being operated, we’ll be forced to cancel those flights by December 2018, so we can put those flights on sale in Europe.”

There are Tory backbenchers who treat his comments as scaremongering, but the recent collapse of Monarch is held up as a good example of the threat to aviation when the paperwork and legal niceties get in the way of business.

Monarch passengers asked why the collapsed company’s grounded planes couldn’t take them home from their holiday destinations. The answer was that they were in the hands of administrators, and legal flight information on them was therefore invalid.

O’Leary is saying that without a reciprocal deal, a flight from the UK to France would be in breach of French and EU rules, leaving itself open to being sued by the authorities and passengers.

Will prices go up?

One of the aims of free-market supporters in the Brexit camp is to cut the cost of goods in stores. They believe the EU is a closed shop that protects expensive EU food and consumer goods with tariffs on cheaper alternatives from outside the single market or customs union.

This is what lies behind international trade secretary Liam Fox’s aim of sealing tariff-free-trade deals with as many countries as possible.

But if the UK crashes out of the European Union without a deal, the months immediately afterwards could see trade damaged, unless border checks are dropped – which is unlikely when the fallout from open borders is uncontrolled immigration.

Trade would be hit because most large supermarket chains have supply chains that allow staff to place orders from depots on the continent and have them fulfilled within hours. Ports such as Rotterdam and Zeebrugge dispatch containers at a moment’s notice across the North Sea or through the Channel to satisfy next-day deliveries. More than twice as much agricultural produce is imported as the UK exports, much of it from the Netherlands, making it a real possibility that supermarket shelves will be empty within days.

White goods imported from China would be less affected, and oil and gas tankers from the Gulf states would dock using existing documentation. Pipelines from Norway would stay open.

Nevertheless, without partners in the EU prepared to agree the legal terms of trade and the level of insurance needed before an order is agreed, no amount of contingency planning, whether it involves vast lorry parks or storage facilities, would remove the risk of shortages or spiralling prices.

Who am I - Swami Sarvapriyananda

Part 1

Part 2

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Why religion is here to stay and science won’t destroy it

Peter Harrison in The Wire.In



In 1966, just over 50 years ago, the distinguished Canadian-born anthropologist Anthony Wallace confidently predicted the global demise of religion at the hands of an advancing science: ‘belief in supernatural powers is doomed to die out, all over the world, as a result of the increasing adequacy and diffusion of scientific knowledge’. Wallace’s vision was not exceptional. On the contrary, the modern social sciences, which took shape in 19th-century western Europe, took their own recent historical experience of secularisation as a universal model. An assumption lay at the core of the social sciences, either presuming or sometimes predicting that all cultures would eventually converge on something roughly approximating secular, Western, liberal democracy. Then something closer to the opposite happened.

Not only has secularism failed to continue its steady global march but countries as varied as Iran, India, Israel, Algeria and Turkey have either had their secular governments replaced by religious ones, or have seen the rise of influential religious nationalist movements. Secularisation, as predicted by the social sciences, has failed.

To be sure, this failure is not unqualified. Many Western countries continue to witness decline in religious belief and practice. The most recent census data released in Australia, for example, shows that 30 per cent of the population identify as having ‘no religion’, and that this percentage is increasing. International surveys confirm comparatively low levels of religious commitment in western Europe and Australasia. Even the United States, a long-time source of embarrassment for the secularisation thesis, has seen a rise in unbelief.

The percentage of atheists in the US now sits at an all-time high (if ‘high’ is the right word) of around 3 per cent. Yet, for all that, globally, the total number of people who consider themselves to be religious remains high, and demographic trends suggest that the overall pattern for the immediate future will be one of religious growth. But this isn’t the only failure of the secularisation thesis.

Scientists, intellectuals and social scientists expected that the spread of modern science would drive secularisation – that science would be a secularising force. But that simply hasn’t been the case. If we look at those societies where religion remains vibrant, their key common features are less to do with science, and more to do with feelings of existential security and protection from some of the basic uncertainties of life in the form of public goods. A social safety net might be correlated with scientific advances but only loosely, and again the case of the US is instructive. The US is arguably the most scientifically and technologically advanced society in the world, and yet at the same time the most religious of Western societies. As the British sociologist David Martin concluded in The Future of Christianity (2011): ‘There is no consistent relation between the degree of scientific advance and a reduced profile of religious influence, belief and practice.’

The story of science and secularisation becomes even more intriguing when we consider those societies that have witnessed significant reactions against secularist agendas. India’s first prime minister Jawaharlal Nehru championed secular and scientific ideals, and enlisted scientific education in the project of modernisation. Nehru was confident that Hindu visions of a Vedic past and Muslim dreams of an Islamic theocracy would both succumb to the inexorable historical march of secularisation. ‘There is only one-way traffic in Time,’ he declared. But as the subsequent rise of Hindu and Islamic fundamentalism adequately attests, Nehru was wrong. Moreover, the association of science with a secularising agenda has backfired, with science becoming a collateral casualty of resistance to secularism.

Turkey provides an even more revealing case. Like most pioneering nationalists, Mustafa Kemal Atatürk, the founder of the Turkish republic, was a committed secularist. Atatürk believed that science was destined to displace religion. In order to make sure that Turkey was on the right side of history, he gave science, in particular evolutionary biology, a central place in the state education system of the fledgling Turkish republic.

As a result, evolution came to be associated with Atatürk’s entire political programme, including secularism. Islamist parties in Turkey, seeking to counter the secularist ideals of the nation’s founders, have also attacked the teaching of evolution. For them, evolution is associated with secular materialism. This sentiment culminated in the decision this June to remove the teaching of evolution from the high-school classroom. Again, science has become a victim of guilt by association.

The US represents a different cultural context, where it might seem that the key issue is a conflict between literal readings of Genesis and key features of evolutionary history. But in fact, much of the creationist discourse centres on moral values. In the US case too, we see anti-evolutionism motivated at least in part by the assumption that evolutionary theory is a stalking horse for secular materialism and its attendant moral commitments. As in India and Turkey, secularism is actually hurting science.

In brief, global secularisation is not inevitable and, when it does happen, it is not caused by science. Further, when the attempt is made to use science to advance secularism, the results can damage science. The thesis that ‘science causes secularisation’ simply fails the empirical test, and enlisting science as an instrument of secularisation turns out to be poor strategy. The science and secularism pairing is so awkward that it raises the question: why did anyone think otherwise?

Historically, two related sources advanced the idea that science would displace religion. First, 19th-century progressivist conceptions of history, particularly associated with the French philosopher Auguste Comte, held to a theory of history in which societies pass through three stages – religious, metaphysical and scientific (or ‘positive’). Comte coined the term ‘sociology’ and he wanted to diminish the social influence of religion and replace it with a new science of society. Comte’s influence extended to the ‘young Turks’ and Atatürk.

The 19th century also witnessed the inception of the ‘conflict model’ of science and religion. This was the view that history can be understood in terms of a ‘conflict between two epochs in the evolution of human thought – the theological and the scientific’. This description comes from Andrew Dickson White’s influential A History of the Warfare of Science with Theology in Christendom (1896), the title of which nicely encapsulates its author’s general theory. White’s work, as well as John William Draper’s earlier History of the Conflict Between Religion and Science (1874), firmly established the conflict thesis as the default way of thinking about the historical relations between science and religion. Both works were translated into multiple languages. Draper’s History went through more than 50 printings in the US alone, was translated into 20 languages and, notably, became a bestseller in the late Ottoman empire, where it informed Atatürk’s understanding that progress meant science superseding religion.

Today, people are less confident that history moves through a series of set stages toward a single destination. Nor, despite its popular persistence, do most historians of science support the idea of an enduring conflict between science and religion. Renowned collisions, such as the Galileo affair, turned on politics and personalities, not just science and religion. Darwin had significant religious supporters and scientific detractors, as well as vice versa. Many other alleged instances of science-religion conflict have now been exposed as pure inventions. In fact, contrary to conflict, the historical norm has more often been one of mutual support between science and religion. In its formative years in the 17th century, modern science relied on religious legitimation. During the 18th and 19th centuries, natural theology helped to popularise science.

The conflict model of science and religion offered a mistaken view of the past and, when combined with expectations of secularisation, led to a flawed vision of the future. Secularisation theory failed at both description and prediction. The real question is why we continue to encounter proponents of science-religion conflict. Many are prominent scientists. It would be superfluous to rehearse Richard Dawkins’s musings on this topic, but he is by no means a solitary voice. Stephen Hawking thinks that ‘science will win because it works’; Sam Harris has declared that ‘science must destroy religion’; Stephen Weinberg thinks that science has weakened religious certitude; Colin Blakemore predicts that science will eventually make religion unnecessary. Historical evidence simply does not support such contentions. Indeed, it suggests that they are misguided.

So why do they persist? The answers are political. Leaving aside any lingering fondness for quaint 19th-century understandings of history, we must look to the fear of Islamic fundamentalism, exasperation with creationism, an aversion to alliances between the religious Right and climate-change denial, and worries about the erosion of scientific authority. While we might be sympathetic to these concerns, there is no disguising the fact that they arise out of an unhelpful intrusion of normative commitments into the discussion. Wishful thinking – hoping that science will vanquish religion – is no substitute for a sober assessment of present realities. Continuing with this advocacy is likely to have an effect opposite to that intended.

Religion is not going away any time soon, and science will not destroy it. If anything, it is science that is subject to increasing threats to its authority and social legitimacy. Given this, science needs all the friends it can get. Its advocates would be well advised to stop fabricating an enemy out of religion, or insisting that the only path to a secure future lies in a marriage of science and secularism.

Big data prove it is possible for a society to be riddled with racism in the complete absence of racists.

The government audit shows racism can be endemic even in the absence of racists


Trevor Phillips in The Financial Times


If Theresa May’s challenge to her own government on race equality does nothing else, it should take some of the terror out of talking about racial difference. Her government’s compendium of data about ethnic minorities’ experience across 130 public service areas, published this week, confronts us with a baffling puzzle: in a society demonstrably more open-minded than a generation ago, why do race and ethnicity remain such powerful pointers to an individual’s place in society?

You do not have to be a specialist in race relations to know that your doctor is more likely to be a Sikh than a Somali. Most of us can see that people from certain backgrounds — South Asians, Chinese — are more likely than others — African Caribbeans, Pakistani Muslims — to wind up as chief financial officers of big companies.

Sir John Parker, in a review that concluded this week, called out the paucity of non-white leaders in Britain’s top companies, confirming what most business leaders know: there are many available candidates but black and brown faces still do not turn up in the boardroom — except perhaps when they come to clean.

White Britons remain cautious about making such observations, for fear of being held personal responsible for racial inequalities. People of colour stay silent because nobody wants to sound like a grievance-monger. The race audit could be the best chance in years to break the silence.

Ministers have anticipated the charge of stirring up minority resentment by releasing a flood of data, some of which show that whites too can be at a disadvantage. White boys, for example, are far less likely to get in to a good university than the proverbial hijab-wearing Bangladeshi-heritage girl. By acknowledging that some differences might turn out to be intractable, Mrs May’s injunction that disparities should either be explained or eliminated could encourage a more open debate.

Some critics suggest that the audit will undermine minorities’ faith in public services. This underestimates the common sense of most people of colour. We do not live to complain about racism. On the contrary, we factor it into our daily lives, shrugging off discourtesies. But forbearance should not be confused with compliance. The data show that people of colour are right to have low expectations of their treatment by the healthcare system, the police or the courts. Their resentment should not be a surprise.

The audit is far from complete. Crucially, it tells us nothing about the UK’s most important economic issue — low productivity. Yet race relations can have a profound impact on the workplace.

A US survey shows that more than a third of white-collar employees think discussing race is off limits in the office, even though staff of all races think it affects their prospects. Blacks and Latinos believe their ethnicity holds them back; whites fear a word out of place will torpedo their careers. Annual appraisals have become stilted affairs: white bosses worry that too critical an assessment will land them in the dock for bigotry. Poor performance goes unchallenged and mediocrity protected.

The data released this week have all been available before. But together they could revolutionise our understanding of racism. Since the 1999 Macpherson Report into the death of Stephen Lawrence, the official doctrine has been that pretty much everyone everywhere was wrapped up in a racist conspiracy, even if they did not know it.

If that is true, how can we explain the fact that every measure of racial hostility has declined steadily over the past 40 years but there has been no corresponding fall in racial disadvantage? The answer is that most racial disadvantage is not the product of individual attitudes. Even if we were to adopt the widest definition of a racial incident, including online insults, and attribute every one of those acts to a prejudiced white person, it remains statistically demonstrable that the average person of colour will encounter such hostility once in their lifetime — not enough to produce the persistent patterns revealed by the audit.

So if Britons are individually better people what is preventing us becoming a better nation? Part of the answer is inertia: racial patterns we inherited and have not dealt with effectively. An example would be ethnic segregation in cities, baked into the geography because of settlement patterns generations ago.

A new source of racial disparities stems from what may be called techno-racism. Online decision systems use apparently neutral data: names, addresses, place of education. But these data carry racial markers that machines can read as reasons to reject minority applications for jobs, loans or insurance. In the US, companies are rewriting mortgage-lending programmes, having seen fines in excess of $100m for discriminating against African-American borrowers. Big data prove it is possible for a society to be riddled with racism in the complete absence of racists.

Mrs May says that government departments will have “nowhere to hide” in future. Unfortunately, her own privacy legislation will protect ministers from scrutiny. Data protection means that neither public bodies nor private corporations are allowed to keep ethnic data about individuals. A prime ministerial decision to allow companies, particularly recruitment firms, to hold ethnic data could be transformative.

Mrs May’s audit has opened a Pandora’s box. But when the first woman in the legend unleashed evils on humanity, Hope sat gleaming at the bottom. Our modern Pandora, lifting the lid on racism, is betting the facts may be the best way to solve our most toxic social problem. In this, at least, she has to be right.