The pillars of democracy

The modern democracy, that most of the nations in Europe and America experience right now, rests on three important pillars, or principles of political organization:

  • the separation of Church and the State
  • the separation of powers in the State
  • freedom of speech and of the Press

The second of these political doctrines are by all means not new and it has been around since Montesquieu. The separation of the rule of religion over the public affairs has been around as a concept for millenia but has been brought again to light closer to our times by the Lutheran doctrine of the Two Kingdoms (the Kingdom of Heaven that stays separated from the Kingdom of Earth, or the political rule of the people). The Enlightment was definitory also for instilling into the political thought the idea that the political affairs need to be conducted by humans. Eventually, the freedom of speech and the press are modern notions with roots in the post-Enlightment period and guarantee that the people under a political rule of a system can keep in check that system and prevent it from becoming tyrannical.

Now, this article is not about explaining why these 3 pillars are important for a modern society. The political philosophers that put forward these principles have done already the job of explaining them. For the modern citizen they come as commonsensical arguments. But these ideas have been constantly under attack. The freedom of press and its capacity to fight the wrongdoings of governments have been diminuated in several democratic countries. One of the reasons is because of a blatant conglomerization of media outlets. The control of news channels rests in the hands of few companies or individuals that can sway the public opinion according to very narrow private interests. While good journalism requires money, the financial part of news organizations has become more important than the purpose of these organizations: to offer a public good.

For violations of these other 2 principles I direct you towards several countries in Europe and the US. First, Romania has completely disolved the separation between the executive and legislative powers. The current government is controlled beyond constitutional means by an overreaching Parliament. The government is legitimate having the support a majority invested with votes, but this has been interpreted by the rulling parties as a free pass for accaparating the executive powers and controlling de facto a government that needs to be independent. What is a more brutal violation is that the control doesn’t happen through the normal legislative powers of the Parliament, but also happens in the non-transparent meetings of the rulling party.

Eventually, the separation of religion and the state is not necessarily violated but there have been attempts to introduce fundamentalist principles in the political organization of a country. What is going on with the abortion law in the US is a very good example. However, in general this principle is complicated to assess, since morality also rests on Christian thought. The risk of going back to a theocracy is extremly low but nonetheless, a modern democracy should be on the guard when it comes to allowing extremist religiosity in the conduct of public affairs.

 

 

Are we in for an economic crisis?

If you open up any financial news outlet these days you can see that one of the headlines is that the euro area growth has considerably slowed down with projections being slashed by 1 percent. That’s a whole deal in the world of economics translating into more than 100 billion euros of productivity losses. In “normal” times, this would have been still bad but now it is potentially catastrophical.

The economic environment in which businesses operate today in the euro area is flooded with liquidity from the Asset Purchase Programme run by the Eurosystem. Think of it as a life support for companies that would otherwise not be existent. It is like a safeguard that things are still running as smoothly as possible until we have cleared the economic and political hurdles we are facing. The APP has ended last year, mostly because the signs of an economic recovery were there and also because there was a clear political pressure on the ECB to end it. But about this in a different story.

Today, following the monetary policy meeting, the ECB has signaled clearly that the probability of a downturn can be serious and it has introduced a new series of longer-term refinancing operations to help maintain the liquidity conditions in the market. My take is that this is pretty much unprecedented in Draghi’s term. It shows that the political pressure has convinced him to give up the idea that stimulus is still needed. In fact, the ECB hasn’t reached its inflation target before it withdrew stimulus and as it looks now, things could be potentially damaging.

 

 

 

On the Cambridge Analytica scandal

Perhaps the biggest tech scandals of this decade brought the quasi anonymous political consultancy Cambridge Analytica (CA) into the spotlight. It wasn’t the publicity they wanted but it revealed the extent of businesses involvement in changing political behaviour.

It is not surprising anymore that manipulation is often used in political campaigns. In the end, the political setup of the modern democracy revolves around power plays between coalitions and struggles to gain power. The focus on achieving political control overshadows the means through which this is achieved.

So, what’s the deal with CA? Is CA the only company that got too close to the Sun? The political machinery of campaigning and political control is definitely supported by the private sector since… ever. From how campaigns are financed in the US with private capital to the informal practices of some businesses “suggesting” voting options to their employees in Eastern Europe, businesses have always been a crucial part of the political machinery.

However, what made CA such a hot topic of discussion is the nature of the intrusion and manipulation they’ve perfected. Moreover, the scale and precision is unprecedented. While speeches broadcast on TV and printed in some newspapers could mobilize the voting base of a candidate and while rallies and employers telling their employees how to vote might bring some votes to a political party, targeting systematically a large amount of a population based on their psychological characteristics that you’ve profiled is definitely an unprecedented act of social engineering.

CA didn’t limit itself to profiling and targeting with content people to change their preferences. CA also attempted to disenfranchise certain ethnic groups.

The scandal revealed that our fears that technology is used to sway elections and manipulate people were true. Technology has a dark side that many of us ignore. We take for granted the liberties we’ve gained in the past century and minimize the consequences of straying away from a liberal democracy.

 

Brexit – 2 years on

About 2 years ago, I was packing my bags to move from Bristol (that has been my home for 2 years), to Frankfurt (my current home for nearly 2 years). One month after my move, Brexit happened. Needless to say, I was shocked and disappointed by the results of the vote partly because, within the academic community I lived in, Brexit was something unfathomable. I, for the first time, realized that my own bubble made me be myopic to the true state of the British society.

Two years on I look at Brexit and try to understand more about the factors that determined it?

Of course, if you read the media, British or non-British, there is a common rhetoric that Brexit happened because (shortly) prior to the vote there was a vitriolic campaign against the EU that was full of manipulation. That’s actually true, the campaign was a show of populism, faulty logic and arguments based on anything but facts.

But was there a deeper sentiment within the British society against the EU? Yes. A very deeply entrenched anti-EU sentiment that was brewing for a long time and it has been left unaddressed by politicians and in general, by media. Sure, this is more or less my opinion that there wasn’t a true debate in the past 10 years about the real benefits of the EU.

I also think that people are sensitive to economic issues and base their vote and opinion on how they feel in general about the state of the economy (e.g. if they have a good job and can eat well and have shelter the propensity to ask for change decreases). The UK economy has been doing pretty well. But how about the sentiment regarding the EU?

There is one big difference between satisfying your needs and having secure employment and thinking that this is the case. Reality and perception are two different thing that might not have any common ground. So, to cut to the chase, what did the British think about the EU? Did they think that they have benefited or not from the UK being a member of the EU?

Let’s have a look at the data and at how the citizens of the UK answered when asked about whether their country has benefited from being a member of the EU (source European Barometer)

 

 

Looking at the data, we see that from 2001 onward, the sentiments that the UK doesn’t benefit from the EU has increased, I would say, considerably. While before 2001 the opinions were split, the data after 2001 shows that the percentage of people who didn’t know what their opinion was on this matter shrunk. While we don’t know how the swing was, we can perhaps assume that the increase in the percentage of people who thought that they didn’t benefit from the EU was at the expense of  the “don’t knows”.

This proves that the perceived utility of memberships declined. What were the factors that determined? I assume they are many and their intersection made it difficult for anybody to predict it. When  you look at the chart above it may seem so obvious that there was a deeper divide between opinions and that someone should have predicted it. But the truth is that this chart alone doesn’t tell much. It just a mere reflection of societal attitudes that are influenced by a plethora of other factors, including how media has portrayed the EU.

It is advisable though for anybody interested in predicting future political and social outcomes to keep a watchful eye on such indicators. They might mirror greater issues in the society.

Weekly reading list #7

Without further due, I’ve selected 3 readings for this week:

Weekly reading list #6

Another week, another reading list. Let’s keep it short this time, too.

  1. The Socio-Economic Review never disappoints. A paper by Natalia Besedovsky on the financialization as calculative practice. A critical study of rating agencies on how the innovations in rating model do not only entail a statistical change but also an epistemological one. It changes the perceptions and expectations on calculability and predictability.
  2. Fresh from the digital printer, a Guardian article on the coop economy. A look at Finland that it is a “natural” example of how this type of economy can work. The big question is whether this can be replicated at a larger scale or in countries that are highly embedded into the capitalist logic (i.e. USA) or post-communist countries that have an allergy to the word “cooperative” due to their political past.
  3. Another sad story on poverty and businesses. No need for much introduction. I recommend it!

 

What have I been up to?

Gearing up for the holiday season means that I have less time for reading.

Weekly reading #5

With an apology for the very long break in between, let’s resume this weekly list with less articles from the news and more helpful guidance for the statistician in you.

  1. The Administrative Science Quarterly blog has a post on data visualization that will make your data stand out.
  2. This paper called “An Economist’s Guide to Visualizing Data” is an amazing resource that looks at hour you can improve your paper or presentation by just following some fast rules.
  3. Data is helpful, we know that! But how can we use it to predict natural disasters? This HBR article gives us a very good overview.

What have I been up to?

Travelling and will resume shortly my readings.

Weekly reading list #4

This week, some interesting stuff going on and the Internet, obviously, picked all these up.

  1. A very good piece on Uber. You know already that I am a follower of this company and I wrote several pieces on it (here, here and here). I am still on the fence with categorizing this entity, but what I am sure of is that it offers a glimpse into the future of work. Work as we know it might disappear. Just think about how some jobs looked like 30 years ago and how they transformed.
  2. Open science: An article on how technology firms shape political communication, an overview of how social media platforms changed the course of the Presidential election in the US.
  3. Is this real life? China to move towards technological control of its citizens, something that reminds me of Black Mirror. We might not even need autocracy for such a societal paradigm to exist. Technology and the peer validation system is already so embedded into our daily life that it seems that an end-point as described in this article is feasible.
  4. A Bloomberg piece on Romania warning that our political class jeopardizes the progress that the country has hardly achieved. The paradox is that a majority government is so unstable. Do you want to know why? I wrote here and here about it.

What I am up to this week? 

Reading  Eeva Houtbeckers’ doctoral thesis on mundane social entrepreneurship. I must say, I am skeptical when it comes to the “social” motivations of these start-ups, but this long piece goes into the depths of the day to day activities of social entrepreneurship to question the categorization of what is social and what is not.

Weekly reading list #3

Another week, another reading list. The past days have been packed with readings. I am trying to navigate a full-time job, studying for GRE and, oh well, reading as much as I can.

  1. A classic anti-gig economy piece in The Guardian. You might have come across it already as I did several times. I am following a lot of academics on Twitter and they have the tendency to distribute The Guardian’s articles the most. But this article particularly follows-up on a long-standing debate in our societies about the changing nature of work in modern times. Bottom line: “When it comes to working in the gig economy, Huws is clear: young people aren’t usually in it by choice”. Agreed, nobody wants precarious employment conditions, we are forced into it.  Is there an alternative?
  2. A brilliant piece on statistics and justice following the Supreme Court of the USA stated “allergy to mathematics”. It dissects the use of stats as evidence in courts and the reluctance of judges to use it when making important decisions that will affect irrevocably the life of people. It argues that the reluctance to use stats in judging is because the justice system prefers arguments based on ideology rather than on facts.
  3. A very wonkish piece on social networks and a splendid extension of early seminal studies on the strength of weak ties (Granovetter, remember?). The study comes up with a new way to measure strength and weakness of relationships in a real network.
  4. Bonus: a very thick article that argues (successfully at times) that the financialisation of our societies is the cause of  our precariousness that ultimately leads to authoritarianism. Max Haiven is the person to go to in case of need of radical anti-capitalist writings. Again, sometimes this type of critical pieces barely come with alternatives and they tend to ruminate the same old ideas. However, Haiven’s writings are easy to digest and make for a great evening reading that will bring your spirits down a notch, closer to the world’s state of affairs.

What am I up to this week?

I am reading Happiness & Economics, a book on how the economy and institutions affect human well-being. I might review it in an upcoming article.

Weekly reading list #2

This week was a busy one with a lot of readings on my list. An interesting development was the award of the Nobel prize in economics to Richard Thaler. Many praised the work of the academic who masterfully translated theories from psychology into economics. Many critics accused economics of imperialism.

  1. Nudging the economists is a brilliant piece on behaviour economics. A must-read for critics of the discipline as well as for those who are working within the field.  Juan Pablo Pardo-Guerra, a sociologist from UCSD, looks at 3 problems with (behavioural) economics among which is the lack of diversity in the field.
  2. A while ago I watched this video of Guy Kawasaki (I think?) in dialogue with a sociologist. He was demanding that the world needs more engineers and computer scientists and less sociologists. It is the former that drive the progress, while the latter just complain. This is a pretty big rhetoric supported by the media… by everybody. Start-ups equal meritocracy. Some of my research showed that the start-ups world is very political. This article I am recommending now tells you the same story but in a different way. Totally recommend it!
  3. Automation and the effect that it has on job security and moreover the society at large is again a hot topic.  One article on this comes from David Besanko. He highlights that labor displacement costs are significant and this could be a side effect of automation. A lecture on the same topic from the LSE.

What am I up to this week?

I am reading The Art of Thinking Clearly by Rolf Dobelli. It is a cute little book packed with aphorisms and anecdotes about how to avoid logical fallacies. It reminds me of La Rochefoucauld. In case you get your hands on it, I would say go for it!