Every month, TEPSA Secretary-General Jim Cloos writes a newsletter editorial on the news of the day, the future of Europe, and the work of the TEPSA network. To receive every upcoming editorial direct to your inbox, SUBSCRIBE to the TEPSA Newsletter here.
Il faut allier le pessimisme de l’intelligence à l’optimisme de la volonté (Gramsci)
At times like ours you often hear the question: “Why did our leaders and experts not warn us against what would happen? The sad truth is that there is no way of predicting historical events. In ‘’World’s end’’, Upton Sinclair wrote: “… Such was the faith of all art lovers of the year 1913; such was the creed being taught in the tall white temple upon the bright meadow. In these fortunate modern days the spread of civilization had become automatic and irresistible. Forty-two years had passed since Europe had had a major war, and it was evident to all that love and brotherhood were stealing into the hearts of the furies and that Orpheus was conquering with his heaven-sent voice and golden lyre.” Churchill said the same without waxing lyrical: “Politics is the ability to foretell what is going to happen tomorrow, next week, next month and next year. And then to have the ability afterwards to explain why it didn’t happen.” Nassim Taleb, in “The Black Swan”, eloquently writes about the “limitations of human nature and the charming and less charming errors and biases when working with matters that lie outside our field of observation, the unobserved and the unobservables—the unknown; what lies on the other side of the veil of opacity.” He coined the notion of ‘black swan’, an event that is not foreseeable and has massive effects. Adams Douglas (In “The Hitchhiker’s guide to the Galaxy”) talks about this without using the term: “The major difference between a thing that might go wrong and a thing that cannot possibly go wrong is that when a thing that cannot possibly go wrong goes wrong it usually turns out to be impossible to get at or repair.”
Does that mean that we are condemned to sit on our hands and wait for cataclysms to engulf us? Is any attempt at foresight a waste of time? Of course not, provided we do not equate foresight with predicting or forecasting the future. For foresight to become a useful tool rather than a fad, the following conditions are necessary:
- Distinguish the signal and the noise, to use the title of a book by Nate Silver: paying too much attention to the constant welter of news items and social media posts actually distracts from understanding the world.
- Look at long term developments: this is difficult for politicians who are immersed in a constant political struggle. The EU is in the privileged position to have an institution, the Commission, that while being political, is less directly exposed to the daily fray of politics and can think more long term. This is one of the reasons why I disagree with the concept of the Spitzenkandidaten (i.e. directly linking the designation of the President of the Commission to the outcome of the European Parliament elections). It would inevitably change the nature and functioning of the Commission and weaken its capacity to think out of the box and with a longer term perspective.
- Understand long term trends: not many people foresaw the invasion of Ukraine by Russia, but the increasingly autocratic turn within Russia and Putin’s growing aggressivity outside should have made alarms clocks ring earlier. The toppling of democratically elected Mossadegh in Iran at the beginning of the 1950s was a factor in Khomeini grabbing power in 1979, as Chalmers Johnson describes in “Blowback: the costs and consequences of American empire.” The results of the recent French, Swedish, and Italian elections have been widely commented on, rightly so. One can regret the success of extreme right-wing parties, but it is even better to ask ourselves why there seems to be this trend developing. What are the underlying reasons for people turning to the extremes? What are the policies they are linked to? Why are so many people expressing support to more euro-sceptical views?
- Link events and trends and reflect on their possible combinatory force: in itself, Germany’s energy dependence on Russia was not a major problem, but it became a liability in the light of Russia’s trajectory over the last years. In this context, a friend of mine alerted me to the effect that rapid climate change is having on the development of the Russian Arctic: it may free up the Northern Sea Route and the exploitation of hydrocarbons in the region. Already now, the Chinese are pouring investments and know-how into Russia to enable the construction of the necessary infrastructure. So we face an ‘Arctic paradox’: the more climate change warms the world, the less sea ice is present in the Arctic, and the more the hydrocarbons present will be available to exploit, thereby creating more fossil fuels to burn.
- Look at facts and figures and educate people, including politicians and journalists to understand them: I recently listened to a podcast by a French expert Jean-Marc Jancovici on CC and carbon emissions. He recalled a simple fact: for the time being, hydrocarbons still account for about 80% of our energy needs. If the world wants to be carbon-neutral by 2050, the effort to make is just gigantic. Will this be achievable without nuclear energy in the transition? Without considerable use of traditional energy sources to build the infrastructure needed for renewables? Without a serious attempt at working on demand, not just on the offer? In this context, Jancovici mentions the so-called rebound principle whereby the improvement of energy efficiency of car engines in the US actually led to an increase of emissions; it made driving the cars cheaper and it made people feel less bad about driving, hence an increase in use and pollution. On the theme of public debt, we would do well to heed the warnings of former IMF boss Jacques Delarosière concerning the unsustainability of world-wide public debt amounting to 300% of world GDP.
- Avoid biases that cloud our perception: Florence Gaub, a leading expert on foresight, mentions in her writings the many biases that are at play and distort our vision: Status quo bias (overstating the present); Pessimism bias (assuming and expecting the worst); Linear thinking bias (extrapolating from existing trends); Confirmation bias (seeking what one already believes to be true). In his excellent book called “Factfulness”, Hans Rosling shows how the pessimism or negativity bias clouds our judgement and makes us oversee statistics that show real progress in health and education across the world. An excellent example of linear thinking is the 1992 OECD forecast for Swedish public debt in 2000 at 128%; in reality the figure in 2000 stood at 53%. In 2012 we happily fought about whether the Greek debt in 2020 should be at 120 or at 121,5%. This was almost comical if you think that we are not capable of predicting the inflation rate of the coming year; just remember what the ECB said about inflation 18 months ago! The confirmation bias is at work when people talk about the benefits or vices of globalization. For some it is all benefits, and they can point to statistics proving their point; for others it is all bad, and they only see the negative side effects, like the spread of inequality, or of epidemics, and the odd financial crash threatening to bring down the whole edifice.
- Draw lessons from past experience : Jean Monnet was right in saying that “people only accept change when they are faced with necessity, and only recognise necessity when a crisis is upon them”. The events post-2008 bear ample testimony to this. Faced with successive crises, the EU has taken steps it would never have taken in ‘normal’ times. The biggest lessons in my view is the need to build resilience and to develop our capacity to act. It matters little whether we call this strategic autonomy or something else; what matters is that we do it. Taleb talks about becoming antifragile, i.e. making an omelette with broken eggs: “Just as human bones get stronger when subjected to stress and tension, many things in life benefit from disorder, volatility and turmoil; [being “antifragile’’ means being] capable of not only gaining from chaos but actually needing it in order to survive and flourish. The point therefore is not to try and predict what by nature is unpredictable, but to become immune to prediction errors and protected from adverse events…Antifragile is a blueprint for living in a Black Swan world.” The EU should use the awareness forced upon us during the latest crises of inefficient or risky supply chains, excessive dependencies in terms of energy, medicines and resources, or a lack of European innovation and platforms in the digital area.
- Finally, always ask ‘What if?’ questions and reflect on possible reactions if they materialize: what if China moves on Taiwan, what if the Putin regime collapses, what if national election results in our Member States have negative effects on EU governance?
I started of with a quote by Gramsci. Let me conclude with one by Confucius: Prepare for the worst, hope for the best, take what comes (Confucius).
Jim Cloos, TEPSA Secretary-General