Today’s topic is far too sprawling to address well in a single post; one can imagine future historians, assuming there’s enough societal surplus to support serious academic inquiry then, will likely debate this and other issues related to the decline of US/Western hegemony. But it seems that there’s been enough additional decline from the already deteriorating baseline of operational (or alternatively, managerial) capabilities in most advanced economies to spur more and more commentators to write about it. Aurelien has been describing this problem in passing but roused himself to write his stylish Reality Would Like a Word. John Michael Greer had a go at the question of why elites today seemed incapable of doing anything useful in a crisis (aside from grifting, which is personally useful) in Storm Trooper Syndrome.
This same week, Andrei Martyanov, who has an extensive, extremely well-documented description and analysis of the decline of the US military across several highly regarded books, warned that the pathology was getting worse. From his When I Talk About…:
… inability to plan operationally and strategically on the part of Washington in general and Pentagon in particular, I do not mean it as a figure of speech. I really mean it in terms of actual planning. Six years ago I called the lack of this ability “the myopia”.
The definition must be changed. With myopia one at least can see near oneself. This IS NOT the case with Washington–it cannot see what is immediately in a front of its eyes and the issue is not myopia but what some people, yours truly included, begin to increasingly assertively state–there is NO strategic planning in Washington at all. It is not just the inability to strategically plan, it is a complete absence of such in principle.
It is a systemic problem and it cannot be addressed without rebuilding the system from the ground up and the good first step would be throwing out all those Ph.Ds in “strategy” who infest US “academe” and think-tankdom while having no fucking clue about what they preach. Studying military and political history in and of itself does not represent “strategic studies” due to inherently complex nature of modern warfare and a required accuracy in description of the object of study, such as a country, in our particular case–Russia. The US in general, and combined West in particular, DO NOT have the tool kit to handle all that, we can say it now with confidence. So, the issue is multifaceted and pseudo-academe and “experts” who dominate decision-making chain in the US are incapable of correcting the course. It is too late now anyway.
And that is my point, the US is so deep in lies, about itself, about the world, about history, about military et al, that I don’t see how can one reasonably debate those people, those masters of discourse who pretend that learning several stratagems and abstract “strategic” constructs makes them masters of “strategy”…. So, I can sit here and produce one example after another for days, but that’s not the point. The point is–US “strategic planning” is non-existent category and anyone who pushes the idea that it exists today should be disqualified as a scholar, since doctrine and strategy-mongering is not strategic planning, especially when done by people who are lost in the complexities of the modern world.
The existence of people here and there who do understand this fallacy does not change the issue that the problem is systemic and cannot be addressed from within–the critical mass of thinkers with integrity and intellectual tool kit are simply not there. And even the US military is losing remaining ability extremely fast–not surprising considering a catastrophe in military education.
In other words, various commentators with very different background are seeing the same disease in different realm: all of us in top level governance, but also in our particular fields: Aurelien in the civil service and caliber of UK/EU decision-making; Martyanov in the military; yours truly in banking/finance and more general corporate management.
The first time I came across this syndrome, I didn’t even recognize what I was seeing. It was in the 2015 Greece bailout negotiations, where we documented at some length that if Greece were to exit the Eurozone, a popular idea in some circles back then it would take war-level mobilization. And even then, it would be inconceivable to get the needed coding for payment systems in and outside Greece to handle a new currency in anything less than three years, and more likely five plus. Mind you, this was not just a matter of the depth and skill of coders working with Greek banks; it would take investment and cooperation by a very large number of parties all over the world, many of whom would not share Greece’s sense of urgency.
We got a stunning amount of pushback, much of it angry. A bit came from people who worked in software at much smaller, non-banking companies and had no appreciation of how the huge transaction volumes banks run every day meant that a difference in degree from their environment was also a difference in kind.
No, most of it was a reflexive, knee-jerk “It can’t possibly be hard. You must be a pro-Troika stooge to be saying the plucky Greeks are stuck in the Eurozone roach hotel.”
At first I thought this was due to something Mark Ames had pointed out long ago, that the left had given up on thinking about finance long ago, and anyone who spoke with knowledge of that realm was automatically suspect. But a banking expert, Clive, pointed out around that time that managerialism was pervasive in the UK, and it took the form of dismissing anyone who pointed out that some cocakmamie new scheme would be hard and/or costly would be told they were not clever enough. The result was often hiring snake-oil consultants who coddled management’s ego and inevitably made things worse.
Then there was Brexit. The short version was it was rife with delusional thinking on the UK side, to the degree that EU pols and commentators drily called it cakeism, as in wanting to have your cake and eat it too. And it didn’t end when the deal was done. Even with the EU giving the UK lots of accommodations, the government did an utterly shambolic job of even recognizing, let alone managing, all the new tasks required by hard borders with the EU.
Aurelien, Greer, and Martyanov place a lot of emphasis on lousy acculturation, as in children and then adults in important positions being protected from the consequences of bad actions like plagiarism, as well as in general being poorly educated compared to say 50 years ago.
While these issues are certainly entrenching this bad situation, IMHO the roots go way bock. Some linked causes (this list obviously is not exhaustive but these factors are important).
The undermining of public education as part of the attack on unions. The various teachers’ unions were among the most powerful and cohesive. The conservative press demonized them regularly. One can concede that the unions should have been required to do more internal policing of lousy or lazy teachers if they were to keep their vaunted tenure. The result has been a decline in the status and relative pay of teachers, which has in turn made the profession less attractive to clever people (trust me, I’ve seen a fair bit in the way of studies saying that teacher pay and standing are strongly correlated with test performance and other measure of learning in many countries)
The weird shift in parenting to give undue importance to esteem, which also undermined education. My impression is that it was in the 1980s that elite and even middle class parents started treating their kids’ precious egos as important. This also came along with the increase of helicopter parenting, children not being allowed much in the way of free play time, and even children no longer being allowed to walk home despite American suburbs being generally very safe (and sexual assault coming mainly from family members and others with existing relationships to the child).
One of the terrible consequences was the loss of teacher control over the classroom. Parents increasingly felt and acted as if they could second-guess teachers, and most schools and school boards backed the parents (I cannot find the article but even a mid 1990s piece in Forbes on the topic of why schools cost so much and weren’t performing attributed it significantly to adminsiphere bloat, as in a higher proportion of budgets going to non-teaching. That also served to reduce the standing of teachers within many systems). The idea that parents could complain about a pupil being put in detention or sent home for misconduct, or would attempt to renegotiate grades was simply unheard of in my day. Parents would nearly always side with the school and might impose additional disciplinary measures of their own, like a cut in allowance until grades improved.
The rise of the symbol economy. In the very early 1980s, management guru Peter Drucker lamented the rise of symbol economy, which using modern nomenclature would include finacialization, advertising, and the increasing importance of management consultants. Even though Drucker had celebrated the rise of managers, his sighting of a proto-professional managerial class made him leery.
I graduated from business school in 1981, at the tail end of the US manufacturing era. Over 40% of my classmates were engineers, as in electrical or mechanical or chemical engineers, or guys who made sure things worked. Hardly any software engineers. Hardly any bankers or investment bankers. Perhaps another 15% to 20% who’d worked for manufacturing companies in other capacities, like sales or accounting.
The obvious needs to be said: in those environments, screw-up like not having enough raw materials on hand or botching scheduling, or accidents, could have a catastrophic impact on operations. So employees were attuned to the need to mind all sorts of nitty gritty details because they really did matter.
I went to Wall Street before the PC era. We did financial analysis on green ledger paper, finding data in copies of annual reports and entering it manually.
While it is correct to say that the adoption of the personal computer greatly reduced the amount of junior person donkey work, making the task cheaper also cheapened the task. Scriveners like me understood how financial statements worked and often had to dig into footnotes. The ones who came behind and grew up doing downloads from Compustat into pre-formatted spreadsheets had a much weaker grasp of corporate finance.
Much more important, making spreadsheeting vastly easier had perverse effects. When financial analysis was costly and time-consuming, bankers, investment bankers, and CFO thought hard about what analyses they would do because they could not run too many scenarios. That meant thinking hard in advance what mattered.
Making spreadsheeting cheap increasingly divorced the exercise from reality, most of all for consultants and deal-pushing M&A professionals. The spreadsheets increasingly became the deal, as in the focus of attention, as opposed to the businesses they represented. And anyone who has done financial forecasting and valuations knows you can make them tell pretty much any story you want to via the assumptions. They can look oh so reasonable but they only have to be all just a bit optimistic to produce wildly inflated results…which won’t be sanity-checked into a sounder version if a top dog really wants to do the deal.
And don’t get me started on PowerPoint. The fact that hired guns are allowed to use something that allows for only vague and incomplete presentations to be a widely-accepted end product is a testament to management incompetence. If you look at a slideshow months after the fact, you have only a sketchy record of what was said. And on top of that, the few words/few bullet points per page approach is awfully reminiscent of children’s books, except without the cute illustrations.
Due to the need to keep this post to a reasonable length, I’ll add one more issue:
The rise of smartphones and social media. The problem with both these advances is due to profit motives, both the devices themselves and major social media platforms have been designed to be seductive and foster dependence. It’s not hard to start on a litany of downsides, such less well socialized kids and now young adults, which means poorer negotiation skills, often aversion to dating, and encouragement of investing in online activities rather that the (generally) healthier pastime of seeing people in the flesh. I can’t prove it but it seems intuitive that less engagement in the messy world of real relationships reinforces potentially unhelpful fantasies (an obvious case is porn. Playboy bunnies were bad enough in creating unrealistic expectations of what women looked like. Confirming my priors, one study found that the average man watches 70 minutes of porn a week, and watching more porn is correlated with performance issues (not surprising given how unrealistic a lot of porn is).
On that titillating note, we’ll stop for now. But I hope readers will flag additional important factors in this sorry decline.