Read on the street 11 July 2020
Another remarkable week in a remarkable time. Our digest of the things we enjoyed reading this week takes us around the world, starting in New Zealand and closing with one of the most important thinkers of our times. Raghuram Rajan should really be governor of the Bank of England now but did not apply due to what can gently be described as the direction of UK politics. In one of the most important pieces you will read this summer, he argues that self-interest should require us to care and act for the poorest in the world. What is true between countries is true within them also.
As he puts it cogently in conclusion:
“Out of self-interest, the world’s more industrialised countries need to avoid beggaring the rest. What happens elsewhere will not stay there. A decade of lost growth in the industrialising world would affect more developed countries severely. Mass long-term unemployment will also prompt mass emigration. Perceptive leaders should persuade less-farsighted colleagues that closing borders to trade and investment will only subject them to endless flotillas and caravans of the desperate. Sharing growth is in everyone’s interest.”
Make no mistake, the risks of very substantial mistakes by governments right now in response to the pain of Covid are real. Populists everywhere cry: “they’ve got yours”. In fact, as Rajan points out, “what happens elsewhere will not stay there”.
But we begin with advice from one of our cleverest friends to the policy makers in New Zealand...
It’s a game of two halves
David Skilling is a first-rate mind advising companies and countries on small advanced economies and policy. This article suggests that New Zealand’s excellent Covid-19 response needs to be matched now in its economic one. Many Scots are now looking for a similar step change from a similarly popular leader as lockdown begins to ease.
Read on Jarden.
Returning furlough cash
This move by McFarlane group was eye catching and follows a similar move by Smart Metering Systems amongst others. Of course, this is enlightened self-interest as well as in the public interest. They seem to recognise that the support of the public purse exacts its own price.
Read in The Times.
What if aviation doesn't recover?
This imagined scenario from 2022 envisions a world in which most major airlines no longer exist. The working assumption in this piece is that the Covid-19 pandemic will exacerbate the decline of an industry that was grappling with serious profitability challenges. This fact – combined with a growing focus on carbon emissions from governments and consumers alike – paints a very bleak picture for the world's carriers. Only time will tell if this worst-case scenario is borne out.
Read in The Economist.
Flaw at the heart of Johnson's big idea
Daniel Finkelstein’s column in The Times is always worth reading, but this is a particularly good one. He highlights that the term “metropolitan elite” has become a badge of dishonour under the political discourse of recent years. However, he points out that social liberalism and economic prosperity go hand in hand. The knowledge economy and creativity will drive the innovation and economic growth of the future. Culture and creativity are key to creating places where people want to live and, therefore, attracting talent. The real issue with the metropolitan elite, Finkelstein says, is not that there is too much of it. It’s that there aren’t enough members of it, drawn from a wide enough range of backgrounds and living in enough places. That should be the real focus of the levelling-up agenda.
Read in The Times.
UK takes £400m stake in satellite firm OneWeb
This story deserves far greater coverage than it got. It is a substantial strategic investment by the UK government, which will not be the last, as companies and the economy will need capital. In crisis the government has backed the wrong investments in the past and lost our collective shirt. This one looks shrewd. We should all be thinking hard now about how government can and should intervene in this way.
Read on BBC.
Brazil's heart of darkness
In this complicated global crisis, Brazil has been one of the countries that has suffered the most. Even relative to its South American peers, the country has not been able to cope with the virus: more than a thousand deaths are registered every day. The chaos has overwhelmed its health system, and at a time when competent, sincere and open political leadership was desperately needed, the opposite was found. The result may be scarring, and will almost definitely feature in the minds of future generations.
Read in the New Statesman.
Japan bans screaming at theme parks
In the fight to curb Covid-19 from spreading, reopened Japanese theme parks have banned visitors from screaming on roller-coaster rides over concerns that thrill-seekers might expel a burst of viral droplets with a mid-ride howl. In an advertisement released by Fuji-Q Highland Amusement Park, the chief executive and his corporate boss can be seen sternly riding the tourist attraction, before plunging 230 feet on the Fuijyama roller coaster in complete silence. It ends with a message: “Please scream inside your heart.” I implore everyone to do themselves a favour and please, please watch the video.
Read in The Wall Street Journal.
Right-wing media outlets duped by a Middle East propaganda campaign
'Deepfakes' have been around for years, but would you ever suspect one of your LinkedIn connections to be computer-generated? This Daily Beastinvestigation traces the strange story of entirely made-up experts who – through a tangled web of false social media profiles, made-up academic credentials and AI-generated faces – managed to dupe leading right-wing news websites into running their content.
Read on the Daily Beast.
Raghuram Rajan on sharing growth
We think that this piece gets to the heart of one of life’s greatest challenges: seeing beyond the end of our own collective nose. Everywhere we look, we chase the symptoms of problems rather than their root cause. Populist pied pipers distract from truth with tales that it is all someone else’s fault. Rajan seems to subscribe to that oldest of Scottish dictums: we are aw Jock Tamson’s Bairns. Such an important piece.
Read in the Financial Times.
Written by Andrew Wilson, founding partner