Brexit is a radical policy innovation that increases uncertainty. Richard Bronk (LSE) argues that the UK government should therefore improve its ability to navigate uncertain futures and avoid the perils of groupthink by remaining open to diverse sources of expertise. He also considers how the populist blame game may play out, as the imagined post-Brexit future collides with reality at the end of 2020.
During the EU referendum campaign of 2016, the Remain side repeatedly warned that if the UK voted to leave the European Union it would be faced with the choice between the Norway option of staying in the Single Market with no say in Brussels or, alternatively, trading on WTO terms, which would imply a large increase in trade frictions with the UK’s main trading partner (the EU), increased red tape, and higher costs. These warnings were dismissed as ‘project fear’. As the world’s fifth-largest economy, the Vote Leave campaign argued, the UK need only believe in itself and it could have its cake and eat it.
In our recent book, Uncertain Futures, Jens Beckert and I argue that all innovations – policy innovations like Brexit included – cause uncertainty. Innovations break the predictable links between the past and the future and insert novelty into the equations of life. As a result, it is not possible simply to rely on existing models and data from the past to tell us what will happen in future. In the jargon, the future is no longer a ‘statistical shadow’ of a known past. The more radical the innovation – and let’s face it Brexit is a radical policy innovation – the more extreme the uncertainty implied.
In such circumstances, when future probabilities cannot be calculated, economic actors and voters alike have no choice but to rely on imaginaries and stories about the future – on how they (and those they most trust) imagine the future will turn out. As Leave campaigners were fond of pointing out in 2016, it was impossible to calculate with any precision the impact of an innovation like Brexit. It was certainly not possible to predict with any assured credibility the costs for each family of exiting the European Union – as the UK Treasury under George Osborne attempted to do.
Fast forward to this 2020 Spring and Summer of uncertain futures. As Henry Mance notes in a recent article in the Financial Times, Michael Gove argued in his Ditchley lecture that politicians should take responsibility for the decisions they advocate. But, as Mance also points out, when pressed on the costs that the Vote Leave dominated government itself now warns companies and voters are likely to face if the UK does not clinch a last-minute deal with the EU (and in many cases even if it does), Michael Gove and the Prime Minister are fond of appealing to ‘Captain Hindsight’. No one could have known, the implication is, that Michel Barnier’s negotiating team would stick to the EU’s avowed aim of protecting the Single Market and refuse to allow privileged access to a country trumpeting its desire to forge a new and more deregulation-friendly path without any of the level-playing field and labour and environmental protections that apply to member states. After all, many Leavers confidently predicted that the EU would be unravelling by now anyway.
This raises an interesting issue that Jens Beckert and I consider in Uncertain Futures: just because the future is uncertain does not mean we can have no clue about it. Indeed, rational actors routinely use calculative models and experience to stress-test their imaginaries against known constraints and well-understood causal mechanisms. While they cannot predict the future – not least because they cannot know how others will react to a novel situation – they can have a shrewd idea of what is feasible and what is pure fantasy.
For example, while rational actors could not predict in 2016 precisely what the impact of leaving the Single Market would be, they did know how much evidence there is behind the gravity model of trade, which captures the tendency for countries to trade most easily and cheaply with countries in close proximity. Replacing trade with the EU with trade with distant countries that have fewer existing ties with the UK was always going to be an uphill struggle even before President Trump ignited a trade war with China and reduced US support for the WTO.
My colleague, Nicholas Barr, summarised a number of other arguments advanced by expert witnesses before the 2016 referendum in an influential LSE Brexit blog, while recognising the uncertainties involved. Together, these indicated that the imagined future in which Brexit would unleash vast new potential for the UK were economically and diplomatically implausible, while the risk that Brexit would destabilise the union of nations within the UK was significant.
In short, in the conditions of uncertainty caused by policy innovation, rational actors rely on expert judgment to say what, on the balance of the evidence, is a plausible imagined future and what is implausible. And, as the future begins to unfold, they rely on a variety of models and informed opinions to diagnose emerging patterns and ensure that they have not fallen in love with an imagined future that increasingly appears out of reach.
In a recent paper, Wade Jacoby and I considered the implications of uncertainty for populist politics. We argued that, where innovation and uncertainty are rife, and where voters’ expectations cannot, therefore, be anchored in objective probability assessments, populists are increasingly free to invent imagined futures that appeal to their base and suit their interests without fear of immediate and conclusive refutation. This freedom is all the greater if the populists succeed in convincing the electorate that they ‘have had enough of experts’, as Gove famously argued in 2016. In such conditions of uncertainty and widespread denigration of experts, the future belongs to those who have the rhetorical and political power to make their narratives and simple slogans count.
The indeterminacy of outcomes in complex systems characterised by widespread innovation and corresponding uncertainty also means that any kind of forensic ex-post apportionment of blame for decisions that go wrong to particular individuals is much more difficult. Too many interdependent factors and decisions play a part for anyone to be held legally accountable. This means that politicians are increasingly free to ascribe blame to whatever group of outsiders will – to paraphrase the anthropologist, Mary Douglas – help man the gates of their own tribal camp.
At some point, of course, imagined futures collide with present reality. As the Brexit transition period ends, it will be interesting to see where the Vote Leave government led by Boris Johnson seeks to place the blame for the disruption caused by the country taking the ‘hard-Brexit’ course it has advocated since the referendum. Will it be on the COVID crisis, on the opposition to Brexit for delaying the inevitable, or simply on the European Union for negotiating hard? And how easy will it be for the Opposition to make a rival narrative of blame attach to the Brexiteers themselves?
In his article, Henry Mance wonders if the denouement of the Brexit saga in 2020 will encourage Dominic Cummings to internalise more fully the influential writings of Philip Tetlock that he professes to admire. I would particularly recommend that Cummings read chapter three of Tetlock’s 2005 book, Expert Political Judgment, where he argues persuasively that political decision-makers make good judgments in relation to the future when, to borrow Isaiah Berlin’s famous distinction, they resemble canny foxes rather than hedgehogs. As Tetlock puts it, hedgehogs know ‘one big thing’, which lends itself to simple political messages; they ‘display bristly impatience with those who “do not get it’’’ (p73); but they tend to ‘dig themselves into intellectual holes. The deeper they dig, the harder it gets to climb out and see what is happening outside’ (p118). By contrast, foxes are much more sceptical of grand claims, are ‘less likely to get swept away in their own rhetoric’ (p100), and they welcome constant challenges to their preconceptions from a wide variety of sources and groups. As a result, they are more likely to revise their opinions when facts on the ground change and are less often totally wrong.
As Wade Jacoby and I have argued elsewhere, analytical monocultures are politically and economically dangerous – leaving those enveloped in them at constant risk of shared cognitive myopia. It follows that the role of a good civil service is to present nuanced ‘on the-one-hand, on-the-other-hand’ briefing that draws on a wide variety of different modelling techniques and perspectives provided by experts. There is, of course, always a danger of groupthink even among those relying on experts, since those who work together frequently succumb to the siren calls of ‘best practice’, when in truth – given uncertainty – you cannot know what best practice will be. The answer is an institutional set-up that encourages the tendency, and enshrines the right, to challenge dominant paradigms.
Dominic Cummings reportedly sees himself as a challenger to groupthink and a great disrupter. But it is at least a reasonable fear that, now in government, the Vote Leave group led by Johnson, Gove, and Cummings are moving from being brave challengers of a tired status quo to paranoid defenders of a new groupthink. In particular, they seem increasingly intent on removing from positions of authority and influence all those who would challenge their now dominant vision of the future with contrary evidence and perspectives. If they take this route and consequently fail to update their aims in the light of emerging evidence, they will have to become ever more inventive in their attempts to shift the blame onto someone else when their imagined future collides with reality.
This post represents the views of the author and not those of the Brexit blog, nor the LSE. Author details available at https://imaginationineconomics.com
Very pleased that you are engaged with this new project. To date I see no coherence in the government’s vision of a post-Brexit Britain and I fear that they are being less than transparent. Why, for example, does Michael Gove describe his massive lorry park in Ashford as infrastructure (implying a productive capital investment) rather than a massive lorry park? Why does Boris Johnson’s assurance as late as December 2019 that there will be no border checks with Northern Ireland now translate into questions of epidemiological units? What have these Etonian schoolboys landed us with?
All I can say is that it’s great luck that we are not part of the EU squabble over Covid 19 rescue money now we have left the EU .That we can put our foot down over China’s treatment of Hong Kong.That we can level up our own country like putting an oxygen mask on oneself before enableing ourselves to help others. So many parts of our country have been unable to breath for the past 40 years because Government policy of both of the Left and Right, has looked towards the dubious safety of being part of the EU .I think there will continue to be a volatile love affair with our neighbours in Europe,but the need for collaboration in all ways will continue and grow, and grow better, because there is a need for it, and without the awful politics.
The “EU squabble” over COVID rescue funds (now settled) is actually our business too. If COVID has taught us anything (or should have) it is that national boundaries are meaningless in the face of global issues, whether it be pandemics, climate change, or even the economy. We do not live in isolation — the EU is the biggest and closest trading bloc in the world and we depend heavily on trade with it, members or not, so the EU’s economic health is very much of concern to us. Obviously, leaving our privileged place at the EU table makes it harder to influence things there, an advantage successive UK governments have failed to engage with properly. UK failure to take up preferred PPE procurement is a case in point. Moves to atomise the world (Brexit, Trump’s famous wall, the breakup of the United Kingdom, etc) only increase the likelihood of us failing to grapple effectively with these serious and existential problems.
In panic the EU has had to find crisis funds for it’s members,otherwise there would be little point in the EU at all.It’s a bit late for many people in Europe ,wheras our Government were able to quickly deal with the a lot of the economic consequencies caused by the pandemic.months ago.The EU would have been great if it were not in such a slow motion, with too many different agendas and the richer members dictating to the poorer. I agree that PPE should have been procured much earlier, but this has nothing to do with Trump. The po faced attitude of the EU towards UK does remind me of the face of the Chinese ambassador when, talking to Andrew Marr, he threatened the UK over it’s stance over Hong Kong. I’m glad our Government are making a fuss over the creeping dominance of China because of the cruelty of their communist system . We need more than the sluggish EU to deal with that scary country.
Your comment, “In panic the EU has had to find crisis funds for it’s members,otherwise there would be little point in the EU at all” is fascinating. The crisis is, as I’m sure you’re well aware, how to recover financially from the covid pandemic. The funds in question are not, as far as I know, for dealing with it *during* the height of the pandemic (something they already arranged), but giving aid to countries *afterwards*; I don’t think the UK has even begun its plans for recovery yet. Therein lies your confusion when you try and contrast with “our Government were able to quickly deal with the a lot of the economic consequencies caused by the pandemic”. While it is true that the UK government acted relatively swiftly on the economic front (though not that swiftly) there’s no evidence to support the implication that EU countries were any slower. Indeed, a basic British misunderstanding about the EU and its function is betrayed here. It’s not the EU who control funds for EU countries; individual states control their economies autonomously (whatever the Daily Mail and Johnson have been telling us for years). Remember when the pandemic hit Italy? At that point, they unilaterally closed their borders to prevent it spreading. Border control (that great British obsession) is and always has been under the jurisdiction of individual member states. (Incidentally, this gives the lie to the oft-repeated shibboleth about EU migration to these shores — our immigration rules have been the way they have been because successive UK governments have chosen them to be that way, not because of some dictat from the EU). The EU’s *post*-peak fund that has just been agreed between 27 different nations has been problematic, as one would expect, with some states wanting 100% grants and a few wanting 100% loans for the recovery. In the end a compromise was reached whereby some funds are grants and some are loans. That 27 very different nations could agree a fund of 1.8 trillion Euros in only 90 hours seems to me to be pretty quick work, despite the differences. I doubt very much whether the constantly Europhobic Brits would have contributed much to an early settlement like this. I would also attribute a “po faced attitude” to the British governments who, for at least three decades have been constantly whingeing about the EU as the source of all their woes, when in fact the exclusive club we helped create has rescued us from being the “poor man of Europe”.
When we come to the Chinese situation, we have again shot ourselves in the foot (or worse). Yes, China and its dealings with its own and others’ citizens is terrible. Their human rights record is atrocious (although I fail to see why the government has only just woken up to the situation — the Dalai Lama fled Tibet in 1959 because of the Chinese). But I would remind you, in contrast, that the EU represents a paragon of human rights, with standards our right wing and not particularly socially-minded government now wants to remove us from. Furthermore, by exiting the Union, we have taken away a vast array of security aid and intelligence from Europe. Our hope is now to ally ourselves with the dysfunctional president of an isolationist America, a country that, since the second world war, has sought to exploit situations for its own benefit, without any sense of sharing, either material goods or intelligence. This manifested itself in the way they virtually stole our nuclear arms development after the war, and has continued to this day with threats of keeping covid vaccine developments for America only (a tactic hopefully undermined by our own home-grown developments in Oxford — let’s hope no one succumbs to the bribery the Americans tried on Germany a few months back). Goodness only know what this one-way “special relationship” will yield when they finally mop up the dregs of our once-great country in the upcoming trade deals. Quite what more we will be able to do to resist China when we’re just another small island off the coast of Europe I’m not sure, but personally I would seek safety in numbers.
I think before you try and characterise the EU as acting against Britain’s interests, you need to understand what we have gained. Yes, the EU is a club, mainly for the benefit of rich countries. But we helped set it up, we have been one of the major beneficiaries, even though we have been constantly complaining about our own inability to cooperate for the common good. We’re a country of exceptionalists, one might say. Yet the people who whip up the anti-EU sentiments are merely the very few élite who stand to benefit — the hedge fund managers, such as Mogg and Farrage; the tabloid barons with vast offshore accounts. You and I will have our freedom of movement curtailed; these rich people will not. Nevertheless, rather than open myself up to accusations of “Project Fear”, let’s wait a few short months until we see what life will be like after Johnson has fulfilled his role on behalf of the élite and crashed us out without any kind of deal. Then we shall see what Project Fear looks like from the inside; in practice and not in theory.
I think (Afterwards) is too late. Furlough schemes put in straight away by our Government has saved many people and businesses from ruin.I’m not too much a fan of the tabloids, and i think your dig is a touch rude. Anyone can see that the Euro is not good for the many speed economies.of the EU. The rich countries get cheap labour., and the poorer ones have a brain drain.Sure we were the poor man of Europe, but the French did not want us to join early on. We were the poor man of Europe because of the second world war. There was the great debt to America. I think America did not like us much..( Communism No Colonialism Never ) were on the posters at the time.I guess it’s true that our own Governments are to blame about the poverty in our own country. I agree with that, but this Government will, I am sure ‘Level UP’now we have left the EU, because they have to.No doubt being part of the EU has done well for us initially ,but even those who have come to live here do not like the cartel controlling the member states.now I do think London ( a world city) with a booming \financial Service sector,does not understand or care about the great poverty in parts of this country. I know because i have seen the dreadful state of the northern seaside town where some of my family came from.At least the Brexit vote has shocked London into taking notice. As for China, I have long felt uneasy about the way things made in the West are undercut. Even millifiore you buy in Venice is made in China. The glass from Murano so beautiful , but so much cheaper from China.. China, the workshop of the world but built on lives that are cheap.( And they steal ideas including some of my husband’s designs) I know you may say that there are cheap imports from other countries but there is something quite sinister about the cruelty of the Chinese system.The crisis in Hong Kong, has shown that China would never lean to wards a western economy as David Cammeron and many other people had hoped. This includes me because our daughter went to China with her school, although she thought the pressure on 10 year olds to learn was terrifying to the point that some children committed suicide..