The Economist USA 12.12.2020

The Economist December 12th 2020 Middle East & Africa 51

Tigris TURKEY Football

Yazidi homeland The most racist club in Israel...

Mount Sinjar Lalish 100 km
Sinjar Erbil
Sinjar Iraqi
SYRIA district Kurdistan

Euphrates Sparsely IRAQ JERUSALEM
populated
...gets an Arab owner
IRAN the rest. Moshe Hogeg, who bought the
Match day at Teddy stadium, home of club in 2018 and remains a co-owner,
Areas of control, Dec 7th 2020 Baghdad Beitar Jerusalem, can get pretty nasty. pressed fans to change their racist lyrics.
Supporters of the football club proudly Most seem elated with Sheikh Hamad’s
Government Kurds Turkish sing about how it is “the most racist team” promise to invest $100m over the next de-
Sources: Janes Conflict Monitor; troops in Israel. They scream epithets, such as cade in the club, which hasn’t won the
Middle East Institute “terrorist”, at the Arabs who play for oppos- league since 2008.
ing squads. Though Arabs make up 21% of
2 Many of the disgruntled Yazidis hail Israel’s population, Beitar Jerusalem has It helps that Israel’s warmer ties with
from Sinjar, home to a mountain the Yazi- never itself fielded one, in keeping with the Arab world are seen as the personal
dis consider holy (see map). Shia militias, fans’ claim to be “forever pure”. After the achievement of Binyamin Netanyahu, the
the Iraqi army and the Kurdistan Workers’ club signed two Muslim players from prime minister and leader of the Likud
Party (pkk), which fights for Kurdish self- Chechnya in 2013, a group of fans burned party. Beitar Jerusalem was founded in 1936
rule inside Turkey, hold sway in the area— down its offices. When one of the Che- by the youth wing of the Zionist-Revision-
not the kdp. A number of Yazidis went to chens scored his first goal, many Beitar ist movement, from which Likud de-
Baghdad in October to meet the prime min- supporters walked out of the stadium. The scends. The club remains a bastion of
ister and to protest against Mir Hazim. “He players soon moved on. working-class Mizrahi Jews, who emigrat-
rules like a dictator,” says one of them. El- ed to Israel from Arab lands. Encouraged by
ders within this faction are trying to set up But on December 7th the Holy Land re- Mr Netanyahu, they tend to resent the old
a more representative authority. ceived proof that God has a sense of irony, Ashkenazi elite that calls for compromise
Many Muslims consider Yazidis to be as Sheikh Hamad bin Khalifa al-Nahyan with the Palestinians. Likud bigwigs can
devil-worshippers. The peacock etched on purchased a 50% stake in Beitar Jerusalem. often be seen glad-handing at Teddy stadi-
their buildings represents Lucifer, the an- Sheikh Hamad is an Arab Muslim. He is um. Mr Netanyahu himself claims to be a
gel cast from heaven—though in the Yazidi also a cousin of Muhammad bin Zayed, the lifelong supporter of Beitar Jerusalem.
telling he is Malik Taous and has been re- crown prince and de facto ruler of the Un-
stored to grace. In the summer Turkey, the ited Arab Emirates (uae), which formally That is perhaps one reason for Sheikh
region’s most powerful Sunni state, normalised diplomatic and other relations Hamad’s purchase: it is an investment by
bombed Sinjar, claiming the Yazidis had with Israel in September. the ruling family of Abu Dhabi in Israel’s
teamed up with the pkk, which Turkey ruling party and its supporters. Mr Hogeg, a
considers a terrorist group. In the Turkish- Some of Beitar Jerusalem’s fans have Jew of Moroccan and Tunisian descent,
held province of Afrin in Syria, militants protested against the deal, spray-painting hopes it will also lead to more change.
have driven Yazidis from their homes and on the stadium’s walls that “the war has Eventually he would like to field Arab play-
defaced their shrines. just begun”. But their collective attitude ers. For now, though, he is relying on Jew-
About 40% of Yazidis are thought to had already been changing. A documentary ish help. Before signing the deal he ob-
have fled to the West. Isolated and cut off called “Forever Pure”, released in 2016, tained the blessing of an Israeli ultra-
from their homeland, many lose their reli- shone a spotlight on the club’s more despi- Orthodox rabbi. 7
gion. Yazidi elders oppose writing oral tra- cable supporters and caused shame among
ditions down or putting them online.
Meanwhile, they rigidly uphold a ban on For Beitar or worse?
marrying out. Some children born of Yazidi
women raped by is members are put out of
the flock. Other strictures—such as the in-
sistence on marrying inside the Yazidis’
caste system—are impractical among tiny
communities abroad. Falling short, many
give up altogether. It is common to see Ya-
zidis abroad wearing blue clothes, which is
taboo back home.
A little bit of liberalism could solve a lot
of these problems. The opponents of Mir
Hazim might be satisfied if he accepted a
broader and more consultative council. Ya-
zidi elders could ease up on those rules that
are all but impossible to follow—and they
could start writing things down. Many Ya-
zidis want other countries to help rebuild
Sinjar and guarantee their protection. But
they are not holding their breath. They cite
74 massacres in their history—and expect
to keep counting. 7

52 Europe The Economist December 12th 2020

Covid vaccines the ema will make the call on a second vac-
cine, by the American firm Moderna. Other
Coming soon covid-19 vaccines that are still in clinical
trials will follow. By the look of things, at
BERLIN some point in 2021 most European coun-
tries may be using three or more covid-19
Europe prepares to receive its first batches of the covid-19 vaccine. vaccines simultaneously.
But supplies and uptake are both uncertain
A mix of vaccines will be needed. Global
In a typical year the Velodrom, an indoor Italy plans to set up 300 covid-19 vaccina- supplies of any one of them will be crimped
arena in Berlin that can hold 12,000 peo- tion sites, starting in hospitals, along with for months. Sharp elbowing for vaccines
ple, hosts sports events, trade shows and mobile units. The laggards are in eastern during the 2009 h1n1 (swine flu) pandemic
concerts. This year, the biggest gig it is pre- Europe, where some countries have done left some European countries unable to
paring for is a mass vaccination drive. If all little more than set up task forces. procure any. Wary of that, the European
goes to plan, in early January people will Commission, the eu’s executive branch,
start streaming through its 75 booths that The starting shot for vaccination in the earlier this year organised joint pre-pur-
are being set up for dishing out doses of European Union will be fired on December chase agreements on behalf of all 27 mem-
Germany’s first supplies of covid-19 vac- 29th, when the European Medicines Agen- ber states with the developers of several
cines. Two of Berlin’s disused airports and cy (ema), the eu’s drug regulator, is expect- prospective covid-19 vaccines (see chart
other venues are also being turned into ed to decide on a covid-19 vaccine created overleaf). These firms received hundreds
vaccination centres. The plan is to be ready by Pfizer and BioNTech, which has already of millions of euros to set up production fa-
to vaccinate 20,000 Berliners a day over six been approved in Britain. On January 12th cilities, even before their vaccines are ap-
weeks. This would account for 10% of the proved. In return, they are reserving large
city’s residents, mainly the very old. Also in this section amounts of their first vials for the eu at a
set price. Approved vaccines will be distri-
Germany is rushing to set up more than 53 Germany, booze and covid-19 buted by the manufacturers to every eu
430 mass vaccination sites like these. It is country in proportion to its population, as
also organising roaming vaccination 54 France and Islamism batches become available.
teams for care homes. In spring, vaccines
will become available at doctors’ offices. 54 The Brothers of Italy on a roll At the moment, the eu has been prom-
Mobile teams will visit the infirm at home. ised up to 300m doses of Pfizer’s vaccine
55 Romania’s worrying election and 160m doses of Moderna’s. Both require
Other European countries are preparing two shots per course, so this should be
too, though most are far behind Germany. 56 Charlemagne: Republic of cranks enough to cover 60% of all the eu’s adults.
The snag is that not much of it will be ready1

The Economist December 12th 2020 Europe 53

2 before spring, even if there are no produc- be too few. Surveys asking Europeans Germany and covid-19
tion hitches, which is hardly guaranteed whether they would be willing to get a co-
given that the vaccines are new and pro- vid-19 jab are returning dispiriting results In vino, virus
duction chains span several countries. In (see chart 2 and Charlemagne). Ipsos mori,
early 2021 Italy, a country of 60m, expects a pollster, found that in some countries the BERLIN
to get enough of the two vaccines for only share of people who say yes actually fell be-
4.7m people. By some estimates, if Ger- tween August and October. The joys and perils of Glühwein gatherings
many relies on its allotment of Pfizer’s vac-
cine alone, it will take two years to get An early sign to watch will be the uptake It is a chilly winter evening in a court-
enough for 60% of its population, the esti- rate among health workers, whom most yard in Prenzlauer Berg, a chic district
mated threshold for “herd immunity”, the European countries plan to jab early on. As in Berlin. The company is convivial, a
level that stops the disease from spreading. things stand, many of them avoid seasonal fire pit is blazing and two cheerful
Hence the impatience of some coun- flu shots and have doubts about the safety barmen are serving up endless glasses
tries, which are looking to top up their eu of the first covid-19 vaccines. Medics are as of steaming Glühwein, a Christmassy
allotments. Hungary is importing a Rus- prone to believing misinformation about concoction of spices, citrus, sugar and
sian vaccine not vetted by the ema. Ger- vaccines as anyone else. But Jacques de (usually bad) red wine. Under corona-
many is cutting its own deals with Pfizer Haller, a former president of the Standing virus restrictions the drinks are sup-
and other vaccine-makers, joining a queue Committee of European Doctors, a profes- posed to be consumed elsewhere. But
that already includes America, Britain, Ja- sional association, says that some doctors here, and across Germany’s cities, that
pan and a global consortium buying co- avoid flu shots out of sheer arrogance, be- rule is honoured mainly in the breach.
vid-19 vaccines for poorer countries. All of lieving they are impervious to the disease. Warmly wrapped (but often unmasked)
this leaves European governments pinning customers clutching their grog gather
hopes on the success of some of the other Based on all this, some experts fear that, in small groups around tables or the
vaccines in the pipeline, and soon. without strong public-messaging cam- fire. And the most magical property of
Since demand will exceed supply for paigns, the uptake of vaccines in Europe, Glühwein—it becomes undrinkable
some time, governments are stepping in to even in countries that do well, could be as once it cools—ensures a steady stream
decide who will get priority. The answer va- little as 40%. Mass public-communication of refills.
ries by country. Bulgaria, for example, campaigns are already being planned. One
plans to start with medical workers be- idea floated in Germany is the slogan German bars and restaurants have
cause its hospitals are bursting with co- “Sleeves up”, with photos of people cheer- been closed to seated custom since
vid-19 patients, and infections among doc- fully getting the jab, possibly with a single November 2nd. Setting up impromptu
tors and nurses are rampant. central phone number that people can call Glühwein stands is one way for their
Germany, Sweden and the Netherlands, for an appointment. owners to replace a bit of lost income,
by contrast, have weighed up the benefits especially as Germany’s beloved Christ-
of vaccinating various groups and decided But a lot more than posters and slogans mas markets, where visitors usually
to start with the elderly. German experts will be needed. In France, where people are quaff gallons of the stuff, have also
considered three scenarios: vaccinating among the most suspicious in Europe been cancelled this year. There are
those with pre-existing health conditions, about any vaccine, millions have watched drive-in Glühwein stands in Bavaria and
the over-60s and people over 80. Their sta- “Hold-Up”, a slick two-hour online docu- Glühwein taxis in Lower Saxony. Some
tistical models suggest that if only 500,000 mentary packed with conspiracy fiction outlets have organised “Glühwein hap-
people a week can be vaccinated, over a 12- about covid-19 vaccines. It is just accurate penings” (although police had to break
week period the greatest reduction in enough to confuse viewers. As pallets of up one in Heidelberg that attracted 200
deaths and hospitalisations will occur if all vaccine begin to arrive in European cities, a people). And with most other forms of
of them are over 80. The total years of life big question remains unanswered. Will public drinking off-limits, this most
gained by vaccinating this group was also people correctly see it as the best way to traditional of libations has even ac-
estimated to be the largest. protect grandma, curb the pandemic and quired a mild hipster edge.
By April or May, Europe’s vaccination bring life back to normal? Or will they see it
woes may swing the other way: vials of vac- as a risky drug peddled by untrustworthy Unsurprisingly, all this jollity has
cine may be more plentiful but takers may governments and corporations, and decide caught the attention of the authorities.
not to roll up their sleeves? If too many Several cities and states have already
make the wrong or selfish choice, 2021 will banned open-air alcohol sales, and
be another annus horribilis. 7 more seem certain to follow. “I know
how much love has gone into setting up
Hopes and fears the Glühwein stands,” said Angela
Merkel, the chancellor, in an emotional
Vaccine doses ordered % of EU “If a vaccine for covid-19 were available, speech to the Bundestag on December
by the EU, m population over I would get it”, % agreeing in online surveys, 2020 9th. “But this is not compatible with the
agreement we have made to take food
Confirmed Potential 16 covered* August† October‡ away to eat at home.”
0 100
200 300 400 50 60 70 80 90 100 In Germany, unlike in all other large
CureVac European countries, the covid-19 case-
54 Spain load is growing. Every day a fresh re-
AstraZeneca/ Belgium cord number of deaths is recorded. Mrs
Oxford University 53 Merkel has endorsed an expert panel’s
recommendation for a tougher lock-
Johnson & Johnson 107 Germany down, including extended school
holidays and business and shop clo-
Sanofi-GSK 40 Italy sures. The experts offered no specific
France views on Glühwein stands. But poli-
Pfizer/BioNTech ticians are surely mulling it over.
40 Hungary
Moderna
21 Poland
Sources: European Commission;
Eurostat; Ipsos MORI *Assuming two doses per person except for Johnson & Johnson, which will only require
one dose. Includes potential †Jul 24th-Aug 7th ‡Oct 8th-13th, not all countries surveyed

54 Europe The Economist December 12th 2020

France and Islamism Defending liberty to religious practice that laïcité is supposed
to guarantee. Some also accuse the govern-
The republic formation that locates or identifies indi- ment of mistaking conservative religiosity
viduals in a way that puts them in danger, for sinister intent, and of ignoring the
strikes back with stiffer penalties for identifying those structural racism behind the development
in positions of public authority. This mea- of French ghettos. Mr Macron has indeed
PARIS sure is a direct response to the murder of so far put less emphasis on his promise to
Paty, whose assassin identified him on so- fight racial discrimination than on the war
A controversial new bill is set to cial media before travelling to the school against Islamism. In parts of the Muslim
combat Islamism where he taught. world, he is accused of being not just anti-
Islamism, but against the religion itself.
Nearly two months after the beheading The government argues that it needs
of Samuel Paty, a schoolteacher who stronger powers in order to break up In France, though, there is broad sup-
had shown pupils caricatures of the Pro- “counter-societies”. Associations under port for Mr Macron’s measures, both on the
phet Muhammad, the French government radical Islamist influence, it says, have in- mainstream left (most of which is firmly
has unveiled a bill to clamp down on radi- creasingly created parallel societies, run- laïc) and the right—although the far right’s
cal Islamism. This, at least, is the implicit ning services from crèches to sports activ- Marine Le Pen considers them too tame.
aim of a draft law presented on December ities, and are waging a war for the minds of Some Muslim leaders have also backed
9th. President Emmanuel Macron had the young. Since 2017 intelligence services, them. Mohammed Moussaoui, head of the
promised a bill to combat “Islamist sepa- magistrates and the state have worked in 15 French Council of the Muslim Faith, said
ratism”. But, to pre-empt charges of stig- such neighbourhoods to “destabilise” net- that the overall aim “reassures French
matising Islam, the final version has been works, closing 15 places of worship and Muslims”, since extremists are such a
reframed as a text “to reinforce the princi- four schools. Such “enclaves”, argues Gilles “marginal minority”. A recent poll showed
ples of the republic”. Kepel, author of a forthcoming book on the that 79% of the French agree that “Islam-
Middle East and jihadism, became a way ism is at war with France”; 72% of Socialist
The bill, declared Jean Castex, the prime for global jihadists to recruit fighters, pro- voters agreed, and 90% on the centre-right.
minister, is “not a text against religion, nor voke Islamophobia and divide Western With less than 18 months before the next
against the Muslim religion”. Rather, he societies. Between 2012 and 2018 over presidential election, Mr Macron’s tough
said, it is “a law of emancipation against re- 2,000 French citizens left to take part in ji- line on Islamism may be criticised abroad,
ligious fundamentalism”, designed to rein- had in Syria, and more than 250 people but is likely to prove popular at home. 7
force such principles as laïcité (secularism) were killed in terrorist attacks in France.
and gender equality. It was presented on Italy
the 115th anniversary of the adoption of a Since his election Mr Macron has come
law that separated religion and the state, to believe that tougher rules are needed to Unchained Meloni
and first enshrined laïcité. This strict defend French society from such influ-
French version of secularism protects the ences. Indeed, Eric Dupond-Moretti, the ROME
right both to believe and not to believe, as justice minister, described the bill as a
well as requiring religious neutrality in “great law of liberty”. In 2004, when France The Brothers of Italy are on a roll
public life. banned “conspicuous” religious symbols
from state schools, recalls Patrick Weil, a The scandals that demolished Italy’s
The new provisions, which will go French historian, the commission of in- post-war political order in the early
through parliament in early 2021, include quiry that preceded the law concluded that 1990s brought a new generation into public
tight curbs on home-schooling (though it was necessary to protect girls from fun- life. Among them was Giorgia Meloni, who
not a ban, as originally promised). Parents damentalist pressure to wear the hijab. at the age of 15 chose to join the youth
will need to apply for permission if they branch of the Italian Social Movement
wish to teach their children at home, and to Not everybody, however, sees it this (msi), the direct heirs of the Fascist Party
justify it. The aim is to limit the use of way. Critics say that the bill hands too and its leader, Benito Mussolini, who ruled
home-schooling as a way to escape state much power to the state to overrule local Italy as a dictator until 1943.
oversight of radical Koranic teaching. Offi- authorities, and that it infringes the right
cials say they have uncovered such classes Today Ms Meloni is riding high as a
in some neighbourhoods. leader herself. Her party, the Brothers of It-
aly (fdi), has been the outstanding benefi-
The bill will also make it easier for the ciary of the covid-19 pandemic. Since late
government to inspect and shut places of February, when it was already on a roll, the
worship or associations that get public party has climbed steadily in the opinion
subsidies, if they do not respect “republi- polls from around 12% to more than 16%. It
can principles”, such as women’s equality. has overtaken the anti-establishment Five
A ban on state employees displaying “con- Star Movement, notionally the senior
spicuous” religious symbols, such as the partner in Giuseppe Conte’s governing co-
hijab or crucifix, will be extended from the alition. The fdi is “becoming firmly estab-
state administration to any form of sub- lished as Italy’s third party”, says Antonio
contracted public service, such as job cen- Noto of Noto Sondaggi, a polling firm. Nor
tres (although, with the existing exception is it unthinkable that it may soon become
of schools, there is no such ban on those the second. Some recent soundings have
using public services, including universi- put Ms Meloni’s party just four points be-
ties). Those who threaten officials with vio- hind the centre-left Democratic Party, also
lence to secure concessions on religious in the government. Mr Conte’s coalition1
grounds will face criminal penalties.

Finally, doctors will be forbidden to is-
sue “virginity certificates” in order to pro-
tect women from pre-nuptial pressure. It
will also be illegal to divulge or publish in-

The Economist December 12th 2020 Europe 55

2 looks increasingly fragile. It is split by a Romania’s election
row over divvying out money from the eu’s
covid-19 recovery fund. Were it to fall, an Diluting the cleanser
election might produce a hard-right co-
alition government consisting of the fdi BUCHAREST
and Matteo Salvini’s Northern League,
which still leads in the opinion polls, with Romania’s next government will have a weak mandate for fighting corruption
around 24%.
The rise in the Brothers’ popularity has Corruption is the biggest political is- stint in government and lacks allies, so pnl
almost exactly matched the fall in support sue across most of eastern Europe, and is likely to form a coalition with usr-plus
for the League. Mr Salvini’s raucous show- Romania is no exception. In recent years and one other party. Negotiations will
manship has jarred with an electorate the streets of Bucharest, its capital, have probably be quick, says Radu Magdin, a po-
gripped by fear of the virus and its eco- filled with huge demonstrations against litical consultant. But any talk of a strong
nomic consequences. At the same time crooked officials and their attempts to mandate is gone. Whoever takes over as the
even diehard nativists must question the weaken the rule of law. Yet on December pnl’s new leader will, astonishingly, be the
League’s leader’s continuing emphasis on 6th, when it was time to vote, the city was country’s seventh prime minister since
unauthorised immigration. So far this year eerily quiet. Just 32% of eligible voters cast 2015.
33,000 migrants have reached Italy, almost a ballot in the general election, the lowest
three times as many as in 2019 but a far cry turnout since the fall of the communist re- The previous election four years ago
from the 181,000 who arrived in 2017. gime in 1989. Some blamed covid-19, others brought in a psd-led government that
Ms Meloni has conveyed a more nu- lacklustre politicians and their almost spent much of its time trying to weaken va-
anced and sober message, typical of her non-existent campaign. It was a sadly rious laws in order to keep its then leader,
canny stewardship of a movement that two missed chance to elect a government with a Liviu Dragnea, out of prison: he was on trial
years ago won less than 5% of the vote at strong mandate to tackle graft. for abuse of power. Hundreds of thousands
the last general election. Brothers of Italy of Romanians took to the streets, worried
may be a slightly odd name for a party led Many had expected the election to bring lest the country follow the anti-democratic
by a woman, but it echoes the first line of stability, after years of brief, scandal- path blazed by Hungary and Poland. Ulti-
the national anthem. Under Ms Meloni the plagued governments. Instead it offered mately Mr Dragnea was jailed, and his psd
fdi has remained passionately nationalis- more uncertainty. The opposition Social was ousted in a no-confidence vote in Oc-
tic and wedded to identity politics. Its mot- Democratic Party (psd), a centre-left outfit tober last year.
to is “God, family and fatherland”. Top of its that promises to raise welfare benefits, got
15-point programme is greatly increased an unexpectedly high 29% of the vote. The Many then expected the National Liber-
support for families, to boost the birth rate ruling centre-right National Liberal Party als to enjoy a period of strength. But the
so Italy no longer needs immigrant work- (pnl) got only 25% and usr-plus, an al- pandemic cost them support. The govern-
ers. It is fiercely against giving automatic liance of anti-corruption parties, won ment imposed a strict lockdown that none-
citizenship to children born in Italy of im- 15%—both scoring well below what poll- theless failed to contain the virus. Roma-
migrant parents, and would impose a naval sters had bet on. “There is no clear winner,” nia’s health system, crippled by the
blockade to stop further arrivals. said Klaus Iohannis, Romania’s president.  emigration of staff to higher-paying jobs in
The fdi originated in 2012 as a splinter western Europe, has struggled to cope. On
group, made up of lawmakers from the To be sure, there was a clear loser. The November14th a fire at a hospital in the city
right of Silvio Berlusconi’s catch-all con- National Liberals’ Ludovic Orban, the of Piatra Neamt killed 15 covid-19 patients.
servative alliance, the People of Freedom. It prime minister, quickly resigned. But his
particularly objected to the tv mogul’s party looks set to stay in power. Though the The anti-corruption activists of usr-
high-handed leadership and his tolerance psd won, it remains discredited by a recent plus had high hopes after recent local suc-
of eu-imposed austerity. The Brothers’ pro- cesses. In September the candidate they
gramme calls for a “rediscussion” of all the The people’s confusing verdict backed defeated a psd mayor of Bucharest
eu’s treaties, including those underpin- who was often accused of cronyism. But
ning the euro. they ran a poor campaign for parliament,
But since taking over the leadership in and hopes that their voters would be
2014, Ms Meloni, unlike Mr Salvini, has unusually dedicated were dashed. The psd
played down her party’s Euroscepticism. In has an advantage when turnout is low, says
other areas, too, she has striven to give her Veronica Anghel, a political scientist: its
party a more moderate image. That got a party machine of local officials can still get
boost in September when she was elected out the vote.
head of the pan-continental European
Conservatives and Reformists Party. The biggest surprise was the Alliance
Though it includes the likes of Vox in Spain for Romanian Unity (aur), a new ultra-
and Poland’s Law and Justice party, it also nationalist party. No one expected it to
includes Britain’s Conservatives, allowing clear the 5% threshold to get into parlia-
the fdi to project itself as no longer belong- ment. It took 9%. Its platform mixes reli-
ing to the extreme right. gious patriotism with a call to annex neigh-
Perhaps the most telling similarity be- bouring Moldova and “a hodgepodge of
tween Italy’s two hard-right parties is that conspiracy theories”, says Cristian Norocel
each is geographically challenged. The of Lund University, an expert on Europe’s
fdi’s support comes mostly from the south far right. Many in the party were involved
and centre, just as the League’s base is in a failed referendum in 2018 to outlaw gay
largely confined to the north. Together they marriage. For those hoping Romania
could make a formidable combination. 7 would focus on fighting corruption and
embedding European values, the election
result was not auspicious. 7

56 Europe The Economist December 12th 2020

Charlemagne Republic of cranks

Why is Europe so riddled with vaccine scepticism? rent-Henri Vignaud, a historian of science at the University of
Bourgogne. Now it is political. There is a correlation between
When pfizer and BioNTech unveiled their covid-19 vaccine, doubting vaccines and voting for populist parties, points out Jona-
politicians from across Europe bustled to claim a slice of than Kennedy of Queen Mary University of London. Both move-
credit. German politicians reminded people that BioNTech was ments are about fear. Just as populist leaders of the left and the
founded by two Germans of Turkish origin. Belgian ones were right stoke suspicion of Davos Man, so anti-vaxxers fret about an-
quick to note that the vaccine is manufactured in Belgium. eu offi- other shadowy global elite—Big Pharma. Both populists and anti-
cials hailed the way in which 27 countries had clubbed together to vaxxers share an ability to turn a kernel of truth into a wider decep-
buy up enough stocks. Britain had to content itself with boasting tion. Immigration has changed Europe, but that does not mean it
that its regulators were the quickest to approve the drug. caused all the continent’s problems, as populists suggest. In the
same way, the opioid epidemic in America raises questions about
Yet for a surprisingly large number of Europeans, a different the ethics of some drug firms, but that does not mean they want to
emotion came before pride: paranoia. Despite scrupulous tests put a chip in your brain. The same reflex lies at the heart of both: a
showing that the vaccine is safe, many people doubt it. One in distrust of experts and institutions. Europe is, increasingly, a para-
three French people thinks vaccines in general are unsafe—the noid continent, where people’s minds are filled with visions of en-
highest figure for any country, according to the Wellcome Trust, a emies, mostly illusory. Vaccines join immigrants, Muslims and a
British charity. A whopping 46% say they would reject a covid-19 host of others as the bogeyman du jour.
vaccine when offered it, according to an Ipsos mori poll. And
France is not alone. In Italy, the eu’s third-largest economy, the Politicians feel they must tread carefully. The British regula-
Five Star Movement won power in part due to their avid fearmong- tor’s speedy approval came in the knowledge that eight in ten Brits
ering about vaccines. Nor is such dangerous poppycock confined were keen on the vaccine even before a public-health campaign
to western Europe. More than 40% of people in Poland and Hunga- showed happy pensioners being jabbed. Swiss regulators have tak-
ry say they would reject a covid-19 vaccine if offered. How did Eu- en a more cautious approach, in a bid to allay the concerns of vac-
rope become such a crucible of credulity? cine doubters. Jens Spahn, the German health minister, declared:
“Nothing is more important than confidence with respect to vac-
Vaccine doubters have been around for as long as vaccination cines.” It is, however, possible to be too cautious. Those who know
itself. An 18th-century French cartoon features two wicked charac- France best suggest that people will be queuing up for the vaccine
ters chasing children with a syringe, dragging a green, smallpox- when it arrives. It is one thing to spurn a vaccine while Emmanuel
ridden monster behind them. Voltaire despaired at his country- Macron is extolling its virtues. It is quite another to reject one sug-
men’s misguided reluctance to try the rudimentary inoculations gested by a family doctor. Actions do not always match words, par-
then becoming common in England. In the eyes of his fellow ticularly in France, where citizens often tick the most pessimistic
Frenchmen, the English were “fools…and madmen”, he wrote. Yet box possible in surveys about the government. Long-held French
even so, riots in 19th-century England kicked off when the govern- doubts about vaccination do not manifest themselves in signifi-
ment made vaccines mandatory. People on Facebook today who cantly lower take-up.
swap hare-brained theories about Bill Gates wanting to insert
tracking chips into everyone are the heirs to 19th-century pam- Likewise, anti-vax sentiment can flame out. While in opposi-
phleteers who suggested people would grow horns if they took a tion, the Five Star Movement, which is part of Italy’s governing co-
vaccine. Europe has always been a republic of letters. Unfortunate- alition, happily stirred up fear of vaccines. Mandatory vaccines
ly it is also sometimes a republic of cranks. were “a gift for Big Pharma”, said Beppe Grillo, the former comedi-
an who co-founded the party. In government, however, conspiracy
What has changed is the motivation. In the 18th and 19th cen- theories collided with reality: a measles outbreak triggered the in-
tury objections were often religious, with illness ascribed to God’s troduction of strict measures the party had once opposed. Populist
will, or concern at the idea of interfering with nature, argues Lau- campaigning does not translate well to the actual problems of gov-
ernment. In a peculiar twist, Five Star supporters are now more
likely to support the idea of a covid-19 vaccine than the average Ital-
ian. European countries have grown unused to large-scale prema-
ture death. The horror of the pandemic, and the prospect of stop-
ping it, may shock them back to their senses.

Vax populi
In the coming months, a lack of supply rather than a lack of de-
mand is a bigger problem for governments organising vaccina-
tions, says Jonathan Berman, author of “Anti-vaxxers: How to
Challenge a Misinformed Movement”. Indeed, talking too much
about vaccine refusal could provoke the very panic governments
want to avoid.

Fringe views are more likely to spread when people lose trust in
their leaders. So the most effective (figurative) vaccine against
anti-vax nonsense would be for governments to roll out their actu-
al covid-19 vaccination programmes as quickly and smoothly as
possible, with a minimum of cock-ups. When elites do their jobs
well, populists and cranks have less to froth about. 7

Britain The Economist December 12th 2020 57

Also in this section
58 Big Tech regulation
58 Toppling statues
59 BLM and public schools
— Bagehot is away

Brexit lengthy dossiers detailing how their pro-

Fade to grey ducts were made, and appoint an agent on

European soil, who can be collared if

things go wrong. The system is overseen by

the European Chemicals Agency (echa) in

Helsinki, which has 600 staff and a budget

of more than €100m ($120m). The enforce-

SHERBURN IN ELMET ment is done by a network of national

What the chemicals industry reveals about leaving the European Union agencies, such as Britain’s Health and Safe-

ty Executive (hse), based in Liverpool. The

Andrew clarke closely guards his reci- dustry is Brexit in microcosm. Boris John- result is a free-flowing pool of 23,000
pe for yolk-coloured ink, known in the son wants a trade deal that eliminates all
trade as a yellow 13. But the process is sim- tariffs on goods, including chemicals. Yet chemicals for Mr Clarke and his continen-
ple enough. Powdery pigment is mixed even if he gets this, it will do little to soothe
with solvent, varnish and thickener, many the headaches that arise from leaving the tal rivals to choose from, underpinned by a
of the supplies imported from abroad, and single market. A project that promised to
then milled between steel rollers into a throw off the eu’s system of regulation will vast database of safety information which
glossy syrup. His factory in Yorkshire spe- instead replicate it in miniature, creating a
cialises in bespoke orders for coatings used Brussels-on-Thames. Chemical firms, for- regulators can scour for risks.
to make food cartons, magazines and cir- eign airlines, lawyers and internet compa-
cuit boards. His small laboratory is lined nies—all will face new burdens if they wish Theresa May, Mr Johnson’s predecessor,
with pots of resins and wetting agents, and to keep doing business in Britain.
machines that measure the fineness and asked to stay in Reach, having been con-
viscosity of his creations. At root is a grand misunderstanding.
Brexiteers often think of the eu’s single vinced there was little to gain from di-
Brexit, which comes into full effect on market as a mere rule book. Thus, they sug-
January 1st, worries Mr Clarke. The Euro- gest, Britain simply needs to copy those vergence. But this was rejected by the eu,
pean chemicals market is fragmenting. He rules into domestic law, and then tweak
fears the substances that give his coatings them at leisure. But the single market is who called it “cherry-picking”. So Britain
their distinctive qualities may slowly dis- better thought of as an ecosystem: an elab-
appear from sale in Britain, leaving him re- orate regime of registration, surveillance will try to replicate the regime at home, un-
liant on inferior substitutes. “If we are try- and enforcement. Goods and services per-
ing to sell to Europe, we might be offering colate freely across national borders be- der the title of “uk Reach”. The names of
our best stuff, but an eu competitor could cause governments can rely on Brussels to
come in using the state-of-the-art raw ma- keep watch for unwanted adulterations. chemicals originally registered by British
terial, which in our customers’ eyes is sig-
nificantly better,” he says. Reach, the bit of the single market go- companies will be copied into domestic
verning chemicals, is especially strict.
The future of the British chemicals in- Firms selling into Europe must submit law. The hse will take on the echa’s job,

funded by fees on users. European compa-

nies will need a legal footprint to trade in

Britain, and British companies vice versa.

The most difficult task will be replicat-

ing the echa’s database. Ministers at first

insisted they could simply copy-and-paste

it. They could not: it is stuffed with com-

mercially-sensitive intellectual property,

and there is little incentive to give a depart-

ing state a leg-up. The eu has so far rebuffed

Britain’s request for a chemicals data-shar-

ing clause in the trade deal. 1

58 Britain The Economist December 12th 2020

2 Instead, the government will require Mr Regulating technology tors. And it will also play an important role
Clarke’s suppliers to submit the data them- in co-ordinating various British govern-
selves. But many dossiers were produced Injection of ment policies, including a code of conduct
by consortia of companies, and there is lit- for technology firms to prevent “online
tle reason for a French firm to bail out a confidence harms”, and new rules around how social
British rival. basf, a big German chemicals media and search engines interact with
firm, reckons registering with uk Reach An assertive new tech watchdog for British journalism.
will cost them £70m ($90m). Small British post-Brexit Britain
distributors whose continental suppliers There are political considerations to all
file paperwork under the eu system may December 8th was a big day for jabs in this. The government now has to enshrine
find themselves designated “importers”. Britain. In Coventry, at the crack of the dmu’s powers in law, but will want to
One boss calculates a bill of £1m in registra- dawn, Margaret Keenan became the first ensure Britain remains an attractive place
tion fees if he has to lodge all the sub- person in the world to receive a proven co- for big tech companies after Brexit. Tighten
stances he imports, on an annual turnover vid-19 vaccine. Meanwhile, in London, the the rules too much and firms may flee to
of £15m: “We’d be bankrupt in a week.” Competition and Markets Authority (cma) Dublin or Amsterdam; leave them too loose
George Eustice, the environment secre- published the blueprint for a new regime of and it risks damaging relations with the
tary, now admits some firms may find the oversight of tech companies. Less momen- eu. So far, Britain’s plans are broadly in step
task “both expensive and time-consum- tous, it nonetheless provides a shot in the with how Europe and other countries are
ing”, and this summer delayed the timeta- arm to Britain’s post-Brexit regulatory rep- thinking about competition in the tech
ble for lodging dossiers for some products utation. “Ground-breaking” is how one sector, says Damian Tambini of the London
from 2023 to 2027. But more time does not competition lawyer describes it. School of Economics, and regulators have
help much, says Peter Newport of the worked well together. That is an encourag-
Chemicals Business Association. “It’s a The idea of the new regime is some- ing start. But it is unlikely to inoculate
change from a guillotined beheading to a thing called “ex ante” regulation, which against other challenges to come. 7
death by a thousand cuts over a six-year ti- tells big companies how they should be-
mescale,” he sighs. have, rather than asking for remedies after Culture wars (1)
There are two scenarios for how this they have misbehaved. The old approach
will play out. One is that ministers push on works for slow-moving industries. But dig- Roads must fall
with uk Reach, and substances are pulled ital ones change too quickly for retroactive
from the British market as manufacturers enforcement to do much good. To fix that, a Bureaucrats will topple more statues
conclude that registration costs make low- new regulator, the Digital Markets Unit than crowds managed last summer
volume products unviable. The so-called (dmu), will write and enforce the rules for
“salt-and-pepper” additives used in tiny tech. The government intends to get it up On december 5th a small group of peo-
quantities in paints are particularly vul- and running by April 2021, and has com- ple carefully removed a sign marking
nerable. The flow going the other way is al- mitted to making it a statutory body. Cassland Road Gardens in London and laid
ready shrinking. Only 70% of the British
firms that registered chemicals with the Most competition law applies to all it on the ground. Thus was one corner of
echa before Brexit have started transfer- firms, or is written for specific industries.
ring their dossiers to new legal entities in The dmu will take this a step further, as- the capital purged of its association with an
Europe, the regulator notes. “We’ll become signing certain companies “strategic mar-
very insular, and they’ll become equally ket status”—meaning they have “en- offensive historical figure—John Cass, an
self-absorbed,” says Mr Clarke. As a result, trenched market power”—and tailoring a
Britain would be a less attractive place to bespoke code of conduct for that particular early-18th-century slave trader. It was a
open an assembly line. firm. Fines for failing to comply will reach
The second scenario is that uk Reach 10% of global revenue. New rules will also modest event, noticed by few, which suited
founders. The deadlines could be pushed come into place around mergers, allowing
back further, or the new rules left unen- regulators to consider how a startup might the organisers. “It makes more sense to do
forced. With an empty database, says Mi- develop, rather than looking only at its cur-
chael Warhurst of chem Trust, an environ- rent market status. The current “ex post” it this way,” says Toyin Agbetu, a researcher
mental charity, the regulator in Liverpool regime means regulators sometimes have
would be less able than the one in Helsinki to try to fix problems years after harm is al- and activist. 1
to spot hazards, or to defend its decisions ready done. On December 9th America’s
against deep-pocketed companies in court. Federal Trade Commission filed an anti- A more dignified end
The promise of Brexit was that Britain trust lawsuit against Facebook, alleging
would be the master of its own regulation, that it had “targeted potential competitive
acting more nimbly or stringently than the threats to its dominance”, buying Insta-
eu if it wished. But the outcome Mr War- gram in 2012 and WhatsApp in 2014.
hurst fears would not be deregulation by
design, but one forced upon ministers be- The significance of the cma’s plan goes
cause their ambitions to match European beyond its effect on technology compa-
standards have failed. A big market means nies. The cma is “setting out its stall as a
Brussels can afford to be strict in its regula- world leader in competition post-Brexit”,
tion. Britain will learn that it cannot. 7 says Katherine Kirrage, a digital competi-
tion and regulatory lawyer at Osborne
Correction In last week’s Bagehot, we claimed that Clarke, a law firm. The publication of its
Hakluyt has close links to the secret service. The proposals precede by a week new rules
firm was established 25 years ago by former from the European Commission, which
employees of MI6, but no longer has connections will probably be similar in spirit. The cma’s
with the agency. Sorry. powers to conduct market studies and in-
vestigations are a model for other regula-

The Economist December 12th 2020 Britain 59

2 The other way is more spectacular. Last Culture wars (2)
June a Bristol crowd inspired by the Black
Lives Matter movement pulled down a stat- New school rules
ue of Edward Colston, another slave trader,
and rolled it into the harbour. In the same Black Lives Matter has made a mark on Britain’s grandest schools
week activists in Glasgow erected alterna-
tive street signs, replacing tobacco barons Joseph spence is everything one might The next examination: privilege
with black heroes. Elsewhere, statues were expect from the master of Dulwich
daubed with paint. Vigilante groups— College. His doctoral thesis delved into ened of censure. A recently departed
some polite and peaceful, others not—mo- 19th-century Irish Toryism, and his cv is Eton teacher says the Charities Commis-
bilised to defend cherished figures. a tour of Britain’s most illustrious sion, which requires schools to prove
To cool things down, many local au- schools. But he is no traditionalist. Un- they provide a public good to enjoy tax
thorities promised to investigate monu- der his leadership, Dulwich offers pupils advantages, has had a significant impact
ments and street names. In theory, all 130 unconscious bias training and a history on their behaviour, as has growing politi-
Labour-led councils are doing so, as are curriculum which aims “to amplify the cal opposition to their charitable status.
some controlled by the Scottish National voices of the colonised as much as the According to the teacher: “Suddenly
Party. Hackney, which contains the cur- coloniser”. The hope, says Dr Spence, is every leading private school had an
rently nameless gardens formerly known to look beyond the conventional canon, outreach officer whose job it was to say,
as Cassland Road, has a rolling process: of- although that “doesn’t mean it has to ‘Look how much we care, look how liber-
fensive things are removed when a group disappear”, he reassures. al and inclusive we are! Please like us!
of councillors, historians and community Please don’t beat us up!’”
leaders reach a consensus. But most coun- Britain’s public schools were once
cils commissioned reports, which are be- proud bastions of tradition—now they Parents are not entirely on board.
ginning to come in. This quieter process is are trying to move with the times. Marl- When pupils at Benenden complained in
likely to topple more statues and names borough focuses on black history, filling October that their headmistress used a
than the crowds did. its curriculum with “as many diverse racial slur in a speech about diversity,
Researchers at Lambeth Archives have texts, guests and experiences as pos- parents backed the head. Yet even some
found that in that London borough four sible”. Harrow’s summer reading list sceptics may recognise the appeal. Top
street names, one ward and one tomb com- includes voguish titles like “White Fra- public schools offer good grades, and the
memorate slave owners. Another seven gility” by Robin DiAngelo. Eton faces opportunity to pick up knowledge that
things have some link to slavery or black criticism for sacking a teacher who made helps you get ahead in the world. Is
oppression—for example, a memorial and a video arguing against “radical femi- knowing the lingo of much of society’s
a block of flats are named after a 17th-cen- nism” (the school insists the problem elite part of that nowadays? “You bet,”
tury director of the East India Company, was the refusal to take it off YouTube). affirms one head teacher.
which traded slaves at the time. Lambeth
Archives uses a traffic-light system: red for Some of this reflects the schools’
definite links, orange for more tenuous intakes. More than a third of pupils at
ones, green for the blameless. independent schools now come from
Some investigations have come up ethnic minorities, up from a quarter a
empty-handed. An independent review of decade ago. Many are aware that they
statues in Bradford found none that is of- could be more welcoming. A survey by
fensive. In Leeds, investigators found only the African Caribbean Education Net-
one “particularly negative” image: an ar- work, a group of black parents whose
chitectural frieze showing an African man children attend private and grammar
in a loincloth. Both cities are far from the schools, found that 76% of their children
coast, and the investigators looked only at have experienced racial bias.
statues. Even so, the reports may affect the
streetscape. They conclude that the cities Change is pushed by pupils. Follow-
should do a better job of reflecting their ing George Floyd’s death in May, many
black, Asian and Jewish populations. petitioned for diverse curriculums. At
By far the most comprehensive report is Charterhouse, pupils formed the Unity
the one commissioned by the Welsh gov- Society, a safe space where they could
ernment. It finds 68 monuments, places or discuss current affairs. Most teachers are
streets with a definite connection to slav- happy to support these efforts, says Will
ery or racism, and another 213 with a looser Orr-Ewing of Keystone Tutors: “These
connection. One man, Thomas Picton, who schools are run by liberals, for liberals.”
governed Trinidad with a brutality that
shocked his contemporaries and was later Opponents think schools are fright-
killed at the battle of Waterloo, has 19 roads
definitely and 13 possibly named after him. want to be? For example, Swansea has a iconoclasm may lead to funding cuts. But
He is also commemorated by a 25-metre Grenfell Park Road. That seems to be big cities are not Tory territory; statues
obelisk and in the names of a sports centre, named after Pascoe St Leger Grenfell, who might become even more tempting targets
a community centre and two pubs. was part-owner of a copper company that if they are associated with the government.
The local councils that will decide the ran Cuban mines with slave labour. But a And the reports will create momentum.
fate of most street names and monuments Grenfell Avenue on the other side of Swan- Gaynor Legall, who chaired the Welsh in-
must mull tricky questions. If slave traders sea might have been named after David vestigation, says she used to assume, na-
are anathema, what about people who op- Grenfell, a Labour mp. It is not clear that ively, that slavery was mostly an English
posed abolition? And how finicky do they many people appreciate the distinction. phenomenon. She hopes that her review
will lead to a national reckoning. “We can’t
The Conservative government is just drop it now,” she says. 7
against removing statues, and hints that

60 International The Economist December 12th 2020

Trans rights treating 16- and 17-year-olds may also need
to consult a judge before starting.
Boys and girls
Trans activists argue that a long-mar-
Worries grow about the treatment of children who say they are transgender ginalised group is now finding its voice in
popular culture. Their critics retort that
In 2018 andrea davidson’s 12-year-old ca had one gender clinic in 2007; now it has vulnerable teenagers are losing themselves
daughter, Meghan, announced she was more than 50. Piecemeal evidence around in an online world which adulates anyone
“definitely a boy”. Ms Davidson says her the world suggests that three-quarters of who comes out as trans. Both could be
child was never a tomboy but the family children expressing gender dysphoria at right. “Being straight is boring,” says
doctor congratulated her and asked what such clinics are adolescent girls, whereas Meghan’s younger sibling.
pronouns she had chosen, before writing a until recently it was roughly evenly split.
referral to the British Columbia Children’s An increasing number are also de-transi- Society is struggling to strike a balance.
Hospital (bcch). “We thought we were go- tioning, choosing to revert to their previ- Some children who feel they are in the
ing to see a psychologist, but it was a nurse ous gender. Unfortunately, if children have wrong body will always feel that way and
and a social worker,” says Ms Davidson already begun a medical transition, includ- might benefit from altering their bodies.
(both her and her daughter’s names have ing hormone treatment, it can leave them Others will change their minds—many of
been changed). “Within ten minutes they infertile and unable to have a full sex life. these will simply turn out to be gay. No
had offered our child Lupron”—a puberty- medical test can tell these two groups
blocking drug. “They brought up the drug Earlier this month the High Court in apart. Children with mental-health pro-
directly with our child, in front of us, with- London looked at the case of one detransi- blems or conditions such as autism are
out discussing it with us privately first.” tioner, Keira Bell, who had brought a judi- more likely to experience gender dyspho-
There was no mention of other mental- cial review against the Tavistock clinic, ria. Untangling all this is extremely hard.
health issues, which are known to increase England’s only specialist youth gender-
the likelihood of gender dysphoria, the identity centre. She claimed that the clinic However, there are worries that rich
feeling that you are in the wrong body. should not have allowed her to take puber- countries have the balance wrong. One of
“There was no therapy on offer and we were ty blockers and later undergo testosterone the Dutch scholars on whose work the pre-
just brushed aside when we raised it.” treatment and a double mastectomy. The scribing of hormones and surgery is based
court ruled that it was “highly unlikely” has said that her research is being applied
Meghan belongs to a wave of children that a 13-year-old and “doubtful” that 14- to young people for whom it was not de-
across the Western world who have identi- and 15-year-olds are mature enough to con- signed. And a growing number of people
fied as transgender in recent years. Ameri- sent to such a procedure, and that doctors are dissenting. The Economist spoke to
more than four dozen people in rich Eng-
lish-speaking countries, including trans
people, parents, doctors, social workers,
teachers and people who had identified as
trans when they were children. Most of
those who were critical wanted to be anon-1

The Economist December 12th 2020 International 61

2 ymous for fear of losing their jobs or being ocably trans and thus you will probably kill they turned 18, surgery. There was no con-
branded bigots on Twitter. yourself if you don’t transition.” Obtaining trol group. Instead the results of a study of
“The first duty of medicine is ‘Do no hormones was easy, she says. “They pretty the approach, published in 2014, conclud-
harm’,” says a Canadian paediatrician. “In much gold-stamped me through.” Then, ed that these medical interventions were
any other branch of medicine, if you were aged 17, her dysphoria disappeared. “I felt successful on the basis of psychological
causing permanent sterility with body-al- extremely lost. I had never heard of this functioning at least one year after surgery.
tering surgery and cross-sex hormones, happening.” She came off testosterone,
you had better have some pretty strong da- embraced her identity as a lesbian, and is The authors warn that their paper con-
ta...But we’re already going down that road furious. “It is the medical industry and the tains a small sample, measures only short-
with no strong data at all.” general social attitude towards dysphoric term psychological outcomes and has no
To find the best approach will require people that failed me.” evaluation of the implications for physical
debate. Some activists do not welcome de- health. One of its researchers, Annelou de
bate, however. “We are liberal people,” says Such “desistance” appears to be com- Vries, this year published a commentary in
Ms Davidson. “But we are always made to mon. At least half a dozen medical studies Pediatrics, a medical journal, saying that
feel like we are right-wing crackpots for show that between 61% and 98% of chil- the approach is being wrongly applied to
raising questions.” dren presenting with gender-related dis- children (mostly girls) with adolescent-on-
tress were reconciled to their natal sex be- set dysphoria. She emphasised the need to
Crossing a Rubicon fore adulthood. However, all these studies identify those who need enhanced mental-
Nobody has global statistics for the rate of looked at children with early-onset dys- health support, rather than gender reas-
trans cases among children. Referrals to phoria. One recent study on adolescent signment. Carl Heneghan, a professor at
the Tavistock in London have surged 30- dysphoria among girls suggested that in the Centre for Evidence-Based Medicine at
fold in a decade, with 2,700 children re- many cases it is brought on by the influ- Oxford University, wrote last year that use
ferred there last year. Nearly half those re- ence of the internet, by female friends who of the Dutch protocol amounts to an “un-
ferred will start on puberty blockers. In have transitioned and by the miseries of regulated live experiment on children”.
2019-20, the bcch treated 382 patients in its puberty. “What is needed is quality re- The High Court in England also called such
gender clinic, up from 123 in 2016-17. Amer- search into adolescent-onset dysphoria interventions “experimental”. The flood of
ica does not publish statistics. However, in among girls, and the overlap with autism hormones in puberty help reconcile a child
a survey of American high-school students and mental-health diagnoses,” says Will to their sex in a way that doctors do not
in 2017 by the Centres for Disease Control Malone, an endocrinologist and director at fully understand. Blockers stop that.
1.8% said they were transgender and a fur- the Society for Evidence-Based Gender
ther 1.6% said they were unsure. Medicine, an international group of doc- No turning back
tors and researchers. The Tavistock clinic argued that puberty
The case for puberty blockers is that blockers are reversible. That is true up to a
they can help children with severe gender The decision to desist is hardest for point. However, they can affect bone densi-
dysphoria, who feel desperate about devel- those who have received medical treat- ty and so doctors often want to move pa-
oping the “wrong” sex characteristics. That ment. Lisa Marchiano, a Jungian therapist tients on to cross-sex hormones, which
is because the drugs could spare them dis- in Philadelphia, counsels several such peo- have more permanent effects. The court
tress and, potentially, traumatic interven- ple. They all believe they were given access concluded that blockers almost always
tions later: a double mastectomy; a hyster- to medical interventions too soon. “It takes lead on to hormones, which carry health
ectomy or the shaving of the Adam’s apple. enormous strength to admit you have in- risks. Testosterone heightens the chance of
vested so much in a strategy that is a mis- heart problems. It leads to vaginal and uter-
Many who go through full medical tran- take,” she says. ine atrophy which can make a hysterecto-
sition say they are happy with the result. my necessary in later life.
Tru Wilson, who lives in Vancouver, is one. The evidence in favour of medical treat-
Tru was a gentle boy, and Tru’s parents ment is being challenged, too. Arguments Despite the uncertainties, many doc-
thought their child might be gay. They then for providing hormones and surgery to tors have embraced medical intervention.
watched a programme together on trans dysphoric teenagers lean heavily on an in- The standard approach used to be “watch-
kids and Tru said, “That’s me!” Tru, now 17, tervention approach pioneered in the ful waiting”, which advocates counselling
began on blockers at 12, on oestrogen at 14, Netherlands, which has come to be known before moving on to hormones and sur-
and is expecting to go through surgery as “the Dutch protocol”. This was tested on gery. However, Joshua Safer of the Mount
within the next year. “I have zero regrets on 55 young people with early-onset dyspho- Sinai Centre for Transgender Medicine and
how my journey went,” she says. Her fa- ria. The teenagers were treated with puber- Surgery in New York says puberty blockers
ther, Garfield, has been impressed by phys- ty blockers, cross-sex hormones and, after are now “the conservative option” because
icians at the bcch. “There was no pressure they allow children time to decide what
pushing us to do anything that we didn’t Gender gap they want to do. Medical bodies including
feel was right for our daughter.” Many other the World Professional Association for
parents also report positive experiences. Britain, referrals to the Gender Identity Transgender Health (wpath) now say that
bcch says that they take the use of puberty Development Service at Tavistock clinic affirming a person’s transgender identity is
blockers seriously and all their patients “go By natal sex* and age “international best practice”.
through rigorous assessments including
confirmation that they are capable of con- 3,000 In America intervention was boosted by
sidering the benefits and risks”. the Affordable Care Act of 2010, which
Adolescents† 2,500 banned health insurers from discriminat-
But other transitioners come to see Female Male 2,000 ing on the basis of sexual orientation and
such procedures as a mistake. Claire (not 1,500 gender identity. In effect, they were thus
her real name), now a 19-year-old student Children‡ 1,000 obliged to cover hormones for people who
in Florida, started on testosterone aged 14 Female Male say they are trans just as they provide con-
because of a loathing for her body. (She was traceptive hormones for women.
also deeply depressed.) “I felt it was the 500
only option, especially with the insistence In 2018 the American Association of Pe-
that having dysphoria meant you are irrev- 0 diatrics (aap) said that all medical evidence
supports the “affirmative” approach. But1
2011 12 13 14 15 16 17 18 19 20
Years ending March

Source: GIDS *Excluding not known †12 and over ‡Under 12

62 International The Economist December 12th 2020

2 according to a detailed rebuttal by James into law. That will do a lot to combat wide- Some politicians in conservative Amer-
Cantor, a Canadian sexual-behaviour sci- spread discrimination against trans peo- ican states have drawn up bills that would
entist, none of the 11 academic studies of ple, such as in housing and the workplace. make it illegal for doctors to prescribe pu-
the subject reaches that conclusion. But it also redefines sex to include gender berty blockers or hormones to children.
Plenty of doctors fail to observe even identity. That could be read to endorse the This is largely an attempt to inflame the
wpath’s guidelines. Laura Edwards- idea that children should be affirmed in the culture wars, but it also reflects the worries
Leeper, a professor of psychology at Pacific identity they choose and receive treatment of some parents.
University in Oregon who helped found for it—even if that identity may turn out to
America’s first transgender clinic for chil- be temporary. Ms Buffone says she raised concerns
dren and teens in Boston, says she gets with her daughter’s school and the local au-
many emails from parents “desperate to In Australia the capital, Canberra, and thority. “It was as though I had left Canada
find a therapist who will not just blindly af- the state of Queensland have outlawed and arrived in some kind of authoritarian
firm that their child is trans”. Ideally, she “conversion therapy” in relation to sexual state. They said this is what we are doing
said, an adolescent with gender dysphoria orientation or gender identity. So too have and it was clear I had no recourse.” Some
would have been regularly seeing a thera- some American states. Canada is consider- parents in Quebec, which has its own curri-
pist, who encouraged them to explore oth- ing a similar law. This conflates two sepa- culum, are also objecting. When Catherine,
er possible causes for their feelings and rate issues. Many people would say it is a consultant, asked to see the content of
had a comprehensive psychological as- wrong to try to convert gay people into be- her six-year-old’s sex-education class, the
sessment before being put on blockers or ing straight. But the implicit definition of school refused, so she made a freedom-of-
hormones. “It is very rare that even one of trans conversion therapy risks outlawing information request. It turned out teachers
these things happens,” she says. any counselling that helps children decide are told that “Children can begin to explore
whether their dysphoria is permanent or a their gender identity between the ages of 3
Schools, the new front line phase, and what to do about it. and 7” and that sex is “assigned” at birth
Affirmation in the clinic often echoes affir- rather than observed.
mation at school. Canada and some Austra- A backlash is beginning. In Sweden,
lian states forbid discrimination against after a 1,500% rise in gender dysphoria di- A legal minefield
anyone on the basis of their self-declared agnoses among 13- to 17-year-old girls in The Australian Family Court has in recent
gender identity. The main school pro- 2008-18, more media coverage has focused years removed itself from decisions about
gramme, taught in British Columbia and on the problems of children transitioning. giving blockers and hormones and even
Alberta and due to be rolled out across Can- Aleksa Lundberg, an activist, said that she surgery for teenagers, unless parents dis-
ada, is called sogi-123. Much of the sogi would probably not undergo surgery if she agree. Instead, it has recently seen the first
programme is uncontroversial, about be- had the same choice today. Referrals of case of a child being removed from parents
ing kind and opposing bullying. But critics children to gender clinics have fallen by who did not support transition. The ruling
worry it makes questioning a child’s deci- 65% in a year. Finland recently released was hardly reported in the press.
sions difficult. stricter guidelines, recommending differ-
ent treatment for early-onset and adoles- Patrick Parkinson, dean of law at the
Pamela Buffone, who runs a website cent-onset dysphoria, and encouraging pa- University of Queensland, says Ms Bell’s
called Canadian Gender Report, says that tients to seek counselling. judgment in England means that such par-
such programmes attach the concept of ents will have a basis to oppose their
“gender identity” (the idea that a biological In America trans activists see questions daughter’s removal. He thinks doctors’
male can identify as a woman, or a female about treatment as political. Chase Stran- claims that puberty blockers are reversible
as a man) to the more familiar concept of gio, a trans lawyer at the American Civil and do no harm have been debunked. “This
“sexual orientation” (being gay or straight). Liberties Union, tweeted of the English is a massive wake-up call for the medical
In March last year Ms Buffone launched a court’s decision: “Please see this for what it profession in Australia,” he says.
legal complaint against a school board in is—an attempt to weaponise our happi-
Ottawa over a lesson, under a different pro- ness, our hopefulness, and our love of our However for many doctors in transgen-
gramme, in which she says her six-year-old bodies. This is a dangerous attack on trans der clinics in America, the idea of restrict-
daughter was taught that there is no such survival and it is spreading.” ing the use of puberty blockers in children
thing as boys and girls. is anathema. Johanna Olson-Kennedy of
the Centre for Transyouth Health and De-
People who support the new curricu- velopment at Children’s Hospital Los An-
lum say that it is important to teach trans geles says she mourns the loss of “this in-
issues in school just as it is important to credible tool” for English children. “I think
teach about race or religion. Glen Hans- there is going to be an avalanche of law-
man, a Canadian teacher who was instru- suits,” says Dianna Kenny, recently retired
mental in the implementation of sogi, says professor of psychology at the University
that affirming pronouns and names in of Sydney. “But they won’t be in time to
schools is “not a gateway drug to other save a generation of adolescents who have
things”. Vince, an 18-year-old trans boy in been wrongly diagnosed as being trans.”
rural Canada, (also not his real name) says
that sogi is a lifeline for many young trans As for Ms Davidson, daughter Meghan
people. He wishes the programme had ex- still struggles with depression. However
isted in his school, where he says he was as- she decided, with her parents, not to take
saulted for being gender non-conforming. the Lupron. In May, by then 14, she an-
nounced: “Mum, I’ve decided I’m a girl.”
Many legislators, not wanting to look She put on lots of make-up and went to the
bigoted, are supportive, too. Having seen shopping mall to get her nails painted. But
how the state failed gay people, they are de- the experience has turned her mother into
termined that it should not repeat the mis- an activist. She has signed up with caws-
take with trans people. In America Joe Bi- bar, a women’s group that advocates for
den has promised to sign the Equality Act rights to be based on biological sex. “I’m
mad as hell,” she says. 7

Business The Economist December 12th 2020 63

Also in this section
64 Facebook’s antitrust issues
65 Bartleby: Why fair play pays
66 SAP’s reset
66 India’s emigrating lawsuits
67 Unautonomous Uber
68 Schumpeter: Dirigiste? Moi?

Corporate balance-sheets plough three times as much into American
startup stars as public investors do. But
A year of raising furiously proceeds from listings are now growing
faster than private funding rounds (see
Companies have issued more debt and equity in 2020 than ever before. chart 2 on next page). And the boom is glo-
What now? bal in nature (see chart 3). On December
2nd jd Health, a Chinese online pharmacy,
In march the corporate world found it- ing a recent trend to buy back shares rather raked in $3.5bn in Hong Kong. A week later
self staring into the abyss, recalls Susie than issue new ones. DoorDash, an American food-delivery dar-
Scher. From her perch overseeing global ling, and Airbnb, a home-rental platform,
capital markets at Goldman Sachs, a bank, Initial public offerings (ipos), too, are both more or less matched it in New York.
she witnessed firms scrambling for money flirting with all-time highs, as startups
to keep going as the wheels of commerce hope to cash in on rich valuations lest In a world of near-zero interest rates, it
ground to a halt amid the pandemic. Many stockmarkets lose their frothiness, and appears, investors will bankroll just about
investors panicked. Surely, the thinking venture capitalists (vcs) patience with anyone with a shot at outliving covid-19.
went, public markets would freeze in the loss-making business models. vcs still Some of that money will go up in smoke,
frigid fog of covid-19 uncertainty—and with or without the corona-crisis. What
then stay frozen. Capital records 1 does not get torched will bolster corporate
haves, sharpening the contrast between
Instead, within weeks they began to Corporate capital-raising*, worldwide, $trn 4 them and the have-nots.
thaw, then simmer, kindled by trillions of 3
dollars in monetary and fiscal stimulus Investment-grade corporate debt 2 The original spark that lit capital mar-
from governments desperate to avert an High-yield corporate debt kets on fire was the $6.25bn in debt and
economic nuclear winter. In the past few Initial public offerings† equity that Carnival Cruise Lines secured
months they have turned boiling hot. Follow-on share issues in April, remembers Carlos Hernandez of
JPMorgan Chase, a bank. Investors rea-
According to Refinitiv, a data provider, 1 soned that cruises will one day set sail
this year the world’s non-financial firms again—by which time some of Carnival’s
have raised an eye-popping $3.6trn in capi- 2007 09 11 13 15 17 0 flimsier rivals will have sunk. Other domi-
tal from public investors (see chart 1). Issu- 20‡ nant firms have benefited from this logic.
ance of both investment-grade and riskier *Excluding financial firms †Including special purpose Boeing, part of a planemaking duopoly,
junk bonds set records, of $2.4trn and acquisition companies ‡To December 7th sold $25bn in bonds this spring, even as its
$426bn, respectively. So did the $538bn in Source: Refinitiv bestselling 737 max jetliner remained on
secondary stock sales by listed stalwarts, the ground and the near-term future of tra-
which leapt by 70% from last year, revers- vel up in the air. Many Chinese companies
have taken to issuing perpetual bonds,
which are never redeemed but pay interest
for ever, to repair their balance-sheets. 1

64 Business The Economist December 12th 2020

Trading places 2 by 39% since. On December 8th Tesla, an der annoyed regulators, may not frighten
electric-car maker whose market value has other listers. And so long as geopolitical
United States, $bn 150 grown seven-fold this year, to $573bn, said tensions between America and China per-
120 it plans to issue $5bn-worth of shares. sist, more Chinese firms with an American
Venture-capital 90 stock ticker may avail themselves of a Hong
funding rounds With shareholder payouts trimmed or Kong one, observes Julien Begasse de
suspended until the covid fog lifts, the cash Dhaem of Morgan Stanley, a bank.
Initial public 60 held by the world’s 3,000 most valuable
offerings* 30 listed non-financial firms has exploded to For now, capital is likely to keep flow-
$7.6trn, from $5.7trn last year (see chart 4). ing. Mr Hernandez says his bank’s pipeline
0 Even if you exclude America’s abnormally of ipos looks “the most robust in years”.
cash-rich technology giants—Apple, Mi- The ten-year Treasury yield is below1% and
2007 09 11 13 15 17 20† crosoft, Amazon, Alphabet and Facebook— the spreads between American govern-
corporate balance-sheets are brimming ment and corporate bonds have narrowed
*Excluding special purpose acquisition companies with liquidity. to pre-pandemic levels. As a result, even
and financial firms †Annualised riskier firms’ paper yields less than 5%, ac-
It is still too early to tell what firms will cording to JPMorgan Chase. Investors ex-
Sources: Refinitiv; PitchBook do with all that cash. The merger market is pecting meaningful returns are therefore
showing signs of life, though mostly as eyeing stocks. For the pandemic’s cor-
2 By the summer, notes Ms Scher, “rescue deals put on ice during the pandemic are porate winners, the choice between cheap
capital-raising” had given way to some- being revived. Many companies will con- debt and cheap equity is a win-win. 7
thing less defensive. Investors’ ultraloose tent themselves with maintaining liquid-
purse-strings allowed opportunistic firms ity, at least until a covid-19 vaccine be- Big tech and antitrust
to lock in historically low coupons. s&p comes more widely available.
Global, a rating agency, calculates that the Battle commences
average investment-grade bond issued this Startups, for their part, will use ipo pro-
year paid interest of 2.6% amid the covid ceeds to blitzscale their way to profitability. A formidable alliance takes on
recession, down from 2.8% in 2019. Thanks The pandemic has made business models Facebook. Investors don’t seem to care
to a boom in online shopping and cloud that might not have matured for years,
computing, Amazon, which is a leader in such as digital health, suddenly viable. Letitia james, New York’s attorney-gen-
both areas, can now borrow at 1.5% for ten Many will fail. But for now giddy investors eral, couldn’t be blunter in describing
years, more cheaply than any American are pouring money into any firm whose ipo the antitrust case lodged on December 9th
firm since at least 1980—and than some prospectus features the words “digital”, against the world’s biggest social network.
governments. Indebted giants like at&t, a “cloud” or “health”. Headier still, “special “By using its vast troves of data and money
telecoms-and-entertainment group, are purpose acquisition companies”, which go Facebook has squashed or hindered what
lengthening debt maturities. In November public with nothing but a promise to merge the company perceived as potential
Saudi Aramco, an oil colossus, sold $2.3bn- with a sexy startup later on, and which have threats. They’ve reduced choices for con-
worth of 50-year bonds, in spite of looming raised $70bn in 2020, mostly on Wall sumers, they stifled innovation and they
climate policies that may cripple its busi- Street, are shattering previous records. degraded privacy protections for millions
ness of selling crude long before 2070. of Americans,” she declared, summarising
Even cheap debt, of course, must be Markets seem no more discerning in the accusations. Forty-five states joined
rolled over and, perpetuities aside, eventu- mainland China, where proceeds from list- her bipartisan coalition against the giant.
ally paid back. With stockmarket valua- ings hit $63bn, the most since 2010. Hong Separately, the Federal Trade Commission
tions propped up by loose monetary policy, Kong added another $46bn. Shanghai’s (ftc) sued Facebook for monopolistic prac-
and only a slim prospect of tightening, star Market, a year-old technology board, tices in social-networking and demanded
many firms opted to shore up their bal- this week welcomed its 200th member, remedies including the firm’s break-up.
ance-sheets with new share issues. Da- bringing its ipo haul to $44bn. In Septem-
naher, a high-rolling industrial conglom- ber demand for shares to be traded on the A few years ago co-ordinated action by
erate, raised over $1.5bn by selling new Hong Kong Stock Exchange by Nongfu 46 states and the ftc that could split Face-
stock just after its share price returned to Spring, a water-bottler, outstripped supply book apart was unthinkable, says Lina
its pre-pandemic highs in May; it has risen by 1,148 times. Even the authorities’ last- Khan, an antitrust scholar at Columbia Law
minute suspension of Ant Group’s record- School. But the case is about more than
breaking $40bn ipo in Hong Kong and narrow competition law. The controversies
Shanghai, after the fintech titan’s co-foun- around Facebook’s privacy practices, the
spread of fake news and conspiracy theo-
Universal picture ries on the platform, and its exploitation by
authoritarian regimes mean regulators
By region*, 2020, $bn 3 Cash and marketable securities‡, $trn 4 and politicians are set on forcing change.

United States Debt issued Equity raised FAMAA (Facebook, Apple, 8 Will they succeed? The cases look
Asia Pacific Debt issued Equity raised Microsoft, Amazon and Alphabet) 6 strong. Experts judge Facebook to be the
Europe Debt issued Equity raised lowest-hanging antitrust fruit, alongside
Google (which America’s Justice Depart-
400 ment sued over alleged monopoly abuses
in October). Amazon and Apple are in the
300 4 crosshairs, but those cases will take longer,
if they come at all, says an antitrust expert. 1
200

Others 2

100

00

J F M A M J J A S O N D† 2007 09 11 13 15 17 20†

Sources: Refinitiv; Bloomberg *Excluding financial firms †To Dec 7th ‡Top 3,000 global listed non-financial firms by market capitalisation

The Economist December 12th 2020 Business 65

2 The Facebook lawsuits centre on its ac- tech’s mostly free products, the suits try a nigh impossible. Last year it started inte-
quisitions. The firm maintained its mo- novel argument: that damage is done to us- grating Instagram, WhatsApp and Messen-
nopoly in personal social-networking by ers’ privacy and advertisers’ choice. ger more deeply. And the ftc’s complaint
systematically buying up potential com- fails to mention it cleared the Instagram
petitors, both contend—notably Instagram Facebook will argue that its market is and WhatsApp deals. The government
in 2012 and WhatsApp in 2014. A smoking social media, which is broader and more “now wants a do-over”, sending a chilling
gun could be Onavo, an Israeli firm Face- competitive than social-networking. Tik- warning to American business that “no
book bought in 2013—to protect user data, Tok, a Chinese-owned short-video app, is sale will ever be final”, Facebook said.
the firm said. The suits claim it in fact used now more popular than Instagram among
Onavo to track rival apps’ popularity and American teenagers. The internal Face- Markets shrugged off the news. Face-
select acquisition targets. Another alleged book emails on which the lawsuits hinge book’s shares dipped by 2%, in line with the
anti-competitive practice was blocking ri- hardly paint a picture of a lazy monopolist; rest of big tech. Investors either see forced
val app developers from its platform. As Mr Zuckerberg and his lieutenants see divestitures as unlikely, says Brent Thill of
consumer harm is hard to prove against big competitive threats everywhere. Facebook Jefferies, an investment bank—or spy even
can also argue that breaking it up is well- more money to be made from spin-offs. 7

Bartleby Fair play

A new book argues that decency pays off in business as well as in life

Nice guys finish last. That pithy mot- airline built by Eddie Rickenbacker, a ment skills. When Danny Boyle, a film
to was coined by Leo Durocher, a pioneer aviator who had granted mechan- director, was asked to organise the open-
baseball manager noted for exulting at ics a 40-hour week, profit-related pay and ing ceremony of the 2012 London Olym-
injuring his opponents and for cheating a pension. But when Frank Lorenzo took pics, he faced the tough task of keeping
his players at cards. In 1969 his Chicago over the company in the 1980s, he cut the details secret when the project re-
Cubs had a big lead in the closing weeks wages, alienated the staff and pursued a quired thousands of volunteers. The
of the season, but he so alienated his policy of asset-stripping the company. The conventional approach would have been
squad (and the umpires) that the team workers went on strike in protest and to make the volunteers sign a non-dis-
failed to make it to the World Series. In Eastern went bankrupt. closure agreement. Instead, he asked
his case, nasty guys finished behind. them to keep the surprise—and trusted
Another contrast cited by the author is them to do so. They did, thanks to the
This is one of the tales told by David that between Steve Ballmer, the hard- grown-up way he treated them. He lis-
Bodanis, a writer best known for his charging chief executive of Microsoft tened to their ideas for improving parts
science books, who has turned his atten- notorious for his towering rages, and his of the ceremony and ensured (by threat-
tion to the issue of how leaders should more emollient successor, Satya Nadella. ening to resign) that the volunteers did
exercise their authority. The core mes- Mr Ballmer so disliked Apple that he seized not have to pay for their costumes.
sage in his book, “The Art of Fairness”, an iPhone from a subordinate in full view
can be found in the subtitle: “The power of the humiliated employee and pretended Mr Boyle demonstrated one of the
of decency in a world turned mean”. to stomp on it. On his watch Microsoft most important traits of good leadership,
missed out on several promising business the author argues, which is a willingness
The Empire State Building was con- opportunities. On the day Mr Ballmer to listen. This relates to a concept known
structed in just 13 months, and that in- announced his departure the share price as the “power distance”. If a relationship
cluded the dismantling of the Waldorf- jumped by 7.5%. Under Mr Nadella, Micro- has a high power-distance score, it is
Astoria hotel that sat on the site. Paul soft has successfully shifted its attention assumed that junior staff should not
Starrett, the builder, treated his workers to cloud-based services and even briefly question their superiors’ decisions; a
rather well by the standards of the time, regained the title of the world’s most valu- lower score means that senior staff are
paying much attention to safety and able listed company. willing to listen.
paying employees on days when it was
too windy to work. Daily wages were Public projects also require manage- Perceptions may differ sharply over
more than double the usual rate and hot whether listening takes place. A study by
meals were provided on site. Johns Hopkins University found that
64% of the medical specialists inter-
The concept is known as “efficiency viewed felt that their operations had high
wages”. Companies that compensate levels of teamwork, whereas only 28% of
workers well and treat them fairly can their nurses agreed.
attract better, more motivated staff.
Unlike most construction projects, the Individuals can become fixated on a
Empire State Building had low staff particular approach to resolving a pro-
turnover, and workers suggested produc- blem and ignore any advice that suggests
tivity improvements such as building a a different tack, especially if it comes
miniature railway line to bring bricks to from a junior colleague. “When your
the site. But Starrett was not naively underlings aren’t terrified of you, and
generous; he hired accountants to patrol you’re modest enough to know you’re
the works, checking that all materials fallible, you can set up the channels that
were accounted for, and staff attendance will help you avoid fixation,” Mr Bodanis
was recorded four times a day. writes. It is a wise lesson. Ruling by fear
may work for a while, but it is doomed to
The author contrasts Starrett’s story fail in the long run. Remember Durocher.
with the tale of Eastern Air Travel, an

66 Business The Economist December 12th 2020

Information technology Enterprise resource course integration of sap affiliates acquired by Mr
Klein’s predecessor, Bill McDermott. These
Hitting the reset Share prices, January 1st 2016=100 include Concur, a travel-expenses firm;
Ariba, a procurement platform; and Suc-
button 400 cessFactors, which makes hr software.
This will require additional investments by
BERLIN Microsoft 350 sap. So will Mr Klein’s plan to increase
spending on research and development.
Can Christian Klein overhaul sap’s Salesforce 300
ageing business model? sap must now persuade its 35,000-odd
NASDAQ 250 erp clients of the benefits of the cloud. It
“Count on us, hold us accountable and Composite must convince investors of the same thing.
together we will reinvent the way Licences for on-site software bring a big
businesses run.” Thus ends a recent letter index 200 chunk of revenue upfront, whereas cus-
of support from 337 senior managers at sap, tomers initially pay much less for rolling
a maker of business software, to Christian Oracle 150 cloud subscriptions. But recurring rev-
Klein, their chief executive. In April Mr enues are increasingly coveted by all man-
Klein, then a stripling 39 years old, took SAP 100 ner of technology firms, from Amazon and
over as sole boss of Europe’s biggest tech- Apple to Netflix, because they are more
nology firm, after running it for a few 50 predictable and build a closer relationship
months in tandem with Jennifer Morgan, with customers. The shift to the subscrip-
an American who used to helm sap’s busi- 2016 17 18 19 20 tion model will eventually mean a big rev-
ness across the Atlantic. He needs all the enue lift for sap, predicts Mark Moerdler at
love he can get, for sap faces a challenge. Revenues for ERP* software, $bn 8 Bernstein, a broker.
Top five companies
Mr Klein became ceo at the peak of co- As for the transition to the cloud, it need
vid-19’s first wave. It had hurt sap more 2018 2019 of which cloud-based not be onerous technically. That is a bit of
than other tech firms: many of its biggest 0246 red herring, thinks Paul Sanderson of
clients, such as carmakers and energy com- Gartner. The bigger challenge is changing
panies, were temporarily hit by the pan- SAP the culture of sap, which has become too
demic. And it struck as more rivals were vy- removed from its clients.
ing for swathes of the business-software Oracle
market that the German giant used to rule. Rivals will try to exploit the transition
Workday period to win over some of those custom-
Then, in October, Mr Klein was hum- ers. Larry Ellison, the colourful co-founder
bled when he presented changes to sap’s Sage and now chief technology officer of Oracle,
business model that would depress mar- declared last year that “sap’s customer base
gins in the short run and delay earlier rev- Infor *Enterprise resource planning is up for grabs.” His subsequent claim that a
enue and profit targets by two years. Com- huge client of sap was about to defect to
bined with lacklustre results for the third Sources: Bloomberg; Gartner Oracle proved unfounded. Another such
quarter, the news shaved 22% off the firm’s boast might not be. 7
share price, wiping out €35bn ($41bn) in sap is very late to the cloud, where com-
market value, the sharpest drop in 21 years panies have been progressively moving for Commercial arbitration
and almost unheard of for a firm of sap’s the past 20 years, says Liz Herbert of Forres-
size (see top chart). The purchase of almost ter Research, a consulting firm. Oracle, The case of the
€250m in sap shares the following day by which also embarked on the transition be-
Hasso Plattner, chairman of the superviso- latedly, has done so swiftly. So has Micro- disappearing cases
ry board, who co-founded the company 48 soft, the world’s biggest software-maker,
years ago, did not reassure investors. with ambitions to expand its enterprise of- More legal disputes over business in
ferings. By contrast, sap remains more of a India are settled elsewhere
To regain their confidence Mr Klein hybrid. It has moved a chunk of its busi-
must improve sap’s offering in the cloud, ness to the cloud but many big customers Amazon, vodafone and Cairn Energy
and persuade more of its clients to move still use its software on their premises. operate in different industries: e-com-
there. And he needs to do this while fend- merce, telecoms and oil-and-gas explora-
ing off competition from firms such as Ora- Why the dithering? Shifting complex, tion, respectively. But they share a com-
cle, Salesforce and Workday in America, customised end-to-end erp processes to mon predicament. All are waging legal
sap’s biggest market. the cloud is much harder than uploading battles over their Indian operations—and
human resources, sales or customer-rela- doing so outside India.
The pandemic has softened demand for tionship management, Mr Klein explains.
“enterprise resource planning” (erp) soft- And erp remains sap’s bread and butter: it The trio are part of a larger wave. Last
ware, which firms use to manage their controls 21% of the market, according to year nearly 500 cases filed in the Singapore
everyday operations—and which has long Gartner, a research firm, compared with International Arbitration Centre came
been sap’s forte. It has also prompted sap’s 11% for Oracle, its closest competitor (see from India. No other country came close
existing clients, typically large or medium- bottom chart). A whopping 92% of Fortune (see chart on next page). The number of
sized manufacturers, to rethink their erp 500 companies—from carmakers, like Indian parties involved in arbitration
processes. “I never had so many calls from bmw, to defence firms, such as Lockheed through the Paris-based International
ceos who wanted to talk about supply Martin—use sap software. It therefore can- Chamber of Commerce tripled last year, to
chains,” says Mr Klein. Retailers and manu- not get the transition wrong. sap listened 147. More quietly, London remains a crucial
facturers asked sap for tools to get more to its customers and took a methodical ap- centre for India-related commercial spats,
visibility of their suppliers. Critically, proach, says an executive at a rival software as to a lesser extent does The Hague. Two1
many of them demanded that erp, which firm, whereas the market wants it to move
has traditionally resided on firms’ own fast and break things. 
servers, be moved to the cloud instead.
Even so, says Mr Klein, “covid was clear-
ly an inflection point.” Bosses of big firms
who may have waited another five years be-
fore switching to the cloud now want to
speed up. They are also demanding a closer

The Economist December 12th 2020 Business 67

Self-driving cars person arbitration panel in The Hague.
The prime minister’s office is said to be
Spinning off
torn over offshore arbitration. On the one
Uber is selling its supposedly vital autonomous-vehicle division hand, it believes that foreigners have no
right to contest Indian taxes; partly in re-
In 2016 travis kalanick, then Uber’s which the cars rely often struggles to sponse to such cases it has withdrawn from
chief executive, described self-driving cope with “edge cases”, which are absent 73 bilateral investment treaties, including
cars as mission-critical. If somebody from software’s training data but pop up the British and Dutch ones, and imposed
managed to beat Uber to making them regularly on real roads. more onerous terms for challenging tax as-
work, he said, then the rival’s ability to sessments in new ones it has signed.
offer taxi trips without paying for human Uber’s self-driving progress has,
drivers would mean that “Uber is no according to industry rumours, been On the other hand, it fears that rejecting
longer a thing.” slow. In 2018 one of its cars ran over and arbitration would reinforce the sense that
killed a pedestrian in Arizona. It is not India is a toxic place for foreign firms to in-
Times change. On December 7th Uber alone; Tesla’s “Autopilot” feature has vest. Appealing against a decision—let
announced the sale of its self-driving been linked to at least four deaths since it alone ignoring it—brings costs, not least by
arm to a firm called Aurora. No price was was launched in 2015. But Uber’s Kalan- putting off investors at a time when Mr
given. But Uber said it would put another ick-era reputation for rule-breaking has Modi is keen to lure them away from China.
$400m into the unit; that Dara Khosrow- made the pr burden heavier.
shahi, its current boss, would join Auro- The second category of disputes settled
ra’s board; and that the deal would leave The bearish interpretation of the sale abroad involves only private parties. These
it with a 26% stake in Aurora. is that, having given up on self-driving, often move offshore simply because busi-
Uber will remain a fancy taxi-and-deliv- ness moves fast whereas Indian courts do
One reason for the spin-off is Uber’s ery firm. But if Aurora can buck expecta- not. It takes more than three years on aver-
belated effort to return to profit. It lost tions and make self-driving work, Uber age to resolve a case before the High Court
$8.5bn in 2019, as it fought for market could license the technology back. And in Mumbai and nearly three years in Delhi,
share with rivals such as Lyft. Besides high-tech distractions like self-driving according to a study by Daksh, a research
offloading the self-driving unit, the firm cars—or flying ones—may be the last group. Seven years is not uncommon,
has sacked workers and sold its Jump thing the firm needs. It is under pressure Daksh says. Lawyers in Mumbai’s High
electric-bicycle division to Lime, a scoot- not just from rivals and investors but Court report that is not hard to find cases
er firm. On December 8th Uber said it also from regulatory probes into its other still pending from the 1960s.
would flog its Elevate flying-car project big cost-saving innovation—the as-
to a startup called Joby Aviation. sertion that its drivers are not employ- Most of the offshore private cases are re-
ees, but independent contractors. Joe solved quickly and quietly. Some, though,
Another explanation is that the reality Biden, America’s president-elect, has make headlines. The one involving Ama-
of self-driving has lagged far behind the called that a “misclassification”. Tighter zon is an example. In October the e-com-
excitement, as it had done in the idea’s European rules will come into force by merce giant won a favourable decision in
earlier heydays in the 1960s and the 2022. Those edge cases look urgent. Singapore to suspend the acquisition of a
1990s. The machine-learning software on tottering retailer, Future Group, by Reli-
ance. Amazon had earlier negotiated with
2 newish arbitration centres in the United Reliance Industries, a conglomerate fam- Future a right of first refusal on any sale.
Arab Emirates, in Dubai and Abu Dhabi, ous for ably navigating India’s courts and Given Future’s troubles, Amazon might
want in on the game. bureaucracy, chose Singapore as the venue reasonably have felt it had no time to wait
Narendra Modi, the prime minister, is to fight a $1.6bn claim by the Indian gov- for a sluggish Indian court to intervene. In
believed to dislike this trend. His adminis- ernment, which accused it of improperly appealing against the Singaporean arbitra-
tration sees it, with reason, as an infringe- extracting gas from fields owned by state- tor’s decision to the Delhi High Court, Fu-
ment of India’s sovereignty—but also as controlled firms. Reliance won and was ture accused Amazon of acting “like the
impugning its laws and judicial process. awarded $8m in compensation. East India Company of the 21st century”.
The resistance to outside meddling in the The comments chimed with Mr Modi’s in-
country’s legal affairs is echoed by its bar Foreign arbitration is all the more at- structions to all Indians to “be vocal for lo-
association, which blocks foreign lawyers tractive for firms lacking Reliance’s local cal”. They rhyme less well with his appeals
and law firms from practising locally. nous. Cairn, which is British, filed its case to foreign investors. 7
Crucial components of the legal system in The Hague, arguing that it should be paid
are nevertheless being outsourced. Com- back $1.4bn in taxes involuntarily extract- Little India
panies feel that it is the best way to get a fair ed on the basis of a retroactive law passed
shot in India. And for all its grumbling, In- in 2012, which was applied to an asset sale Top ten foreign countries using the
dia’s government understands that attract- six years earlier. Cairn says this violated a Singapore International Arbitration Centre
ing investment requires the availability of bilateral investment treaty between Britain 2019, number of cases
a judicial recourse that is considered effi- and India; a decision is expected any day
cient and fair—which Indian courts can at now. Vodafone’s case stems from the same 0 100 200 300 400 500
times seem not to be. law and relies on a similar treaty which In-
The emigrant cases can be divided into dia signed with the Netherlands. The firm, India
two categories. The first kind involve the which had purchased mobile-telephony Philippines
Indian government. Vyapak Desai of Nish- assets in 2007, won a bitterly fought case China
ith Desai Associates, an Indian law firm before India’s Supreme Court in 2012 ex- United States
with expertise in the area, has compiled a empting it from a capital-gains tax on the Brunei
list of more than a dozen big cases pending. transaction, only to have the levy reim- UAE
Some were brought by Indian firms. In 2017 posed by India’s parliament. In September Switzerland
it won a unanimous decision from a three- Indonesia
Thailand
Malaysia

Source: Singapore International Arbitration Centre

68 Business The Economist December 12th 2020

Schumpeter Dirigiste? Moi?

Swathes of France sa have shaken off the attention of politicians—and thrived

If dinner parties were permitted in locked-down France, it is less use for political connections. The index’s brightest stars today
not hard to guess what would set le tout Paris aflutter. For months are luxury giants such as lvmh (of Louis Vuitton fame), Kering
bankers, politicians and other pre-covid canapé-scoffers have tak- (Gucci) and Hermès; L’Oréal, a beauty-products firm; Sanofi, a
en sides in a corporate battle royale pitting two century-old firms drugmaker; and a host of industrial giants. Selling handbags or
against each other. Veolia, a water- and waste-management utility, skincare products to Chinese yuppies is a global contest in which
has been struggling to gobble up Suez, a rival which is resisting French firms excel, thanks to competent management. Lesser-
fiercely. The proposed deal is mired in legal disputes, boardroom known but equally astute companies such as Schneider Electric, a
recriminations and ministerial intrigue. All grist to the mill for specialist in energy-management kit, have outperformed Ameri-
those who see French business as the product of its politicians’ di- can rivals such as 3m and General Electric, and European ones like
rigiste tendency to shape the private sector in the mould of the Siemens and abb. Investors in Air Liquide, a chemicals firm, have
public one. But look at the wider French business landscape and enjoyed juicier returns than those of Germany’s basf or America’s
the stereotype is out of date. Away from the clutches of politicians, DuPont. Publicis, an advertising group, is worth nearly three times
many French firms have become world-beaters. Is this thanks to as much as in 2000, while rivals like wpp in Britain and Omnicom
the attention of elected officials—or in spite of it? in America have lost market value. EssilorLuxottica, a French-Ital-
ian firm, is the world’s biggest purveyor of spectacles.
The ugly spat between Veolia and Suez shows politics still mat-
ters in Parisian business circles. Given the two firms offer the same Even more telling, some big firms began to prosper only once
outsourced environmental services to customers dotted across unshackled from the government yoke. Total, an oil-and-gas ma-
the globe, a tie-up has long been mooted. Veolia having already jor, used to be worth a fraction of bp or Royal Dutch Shell. As it has
seized nearly a third of its target’s shares, each side has lined up gained distance from the corridors of power since privatisation in
members of l’establishment to make its case. Their brief is not so 1992, it has caught up with its European rivals’ valuations. Safran,
much to convince shareholders of the merits of a deal, as might be an aerospace firm, has seen its market value go up 14-fold in two
the case in Britain or America. Rather, politicians whose assent is decades as the state has sold down its stake. Airbus has outpaced
considered critical are an important audience. Suez and Veolia are its American jetmaking nemesis, Boeing, as political meddling (by
each said to have a former speechwriter to President Emmanuel the many European governments that founded it) has ebbed.
Macron lobbying for them (not the same one). Given that a slew of
legal challenges and regulatory clearances is required, the out- And today political allies carry less heft than they once did. Ac-
come will not be known for months. Few think it will hinge on the cording to Morgan Stanley, a bank, over 70% of big French firms’
transaction’s commercial merits. revenues nowadays come from overseas, where French politicians
hold little sway. Most regulation critical to French firms used to be
Such intrigue used to delight the French business elite. Now it done at national level, where regulators were drawn from the same
feels old hat. Look at the top of the cac 40 index of France’s leading ena lecture halls as corporate bosses. Now a lot is carried out by
companies today, and a new generation of firms has emerged. Two European or global watchdogs.
decades ago the corporate league table was dominated by firms in
sectors in which relations with government matter, such as tele- That is not to say that big firms and politicians steer clear of
coms, utilities or banking. The bosses of France Télécom or bnp Pa- each other. France’s foreign minister recently waded into lvmh’s
ribas, a bank, were inevitably former ministerial advisers. More takeover of Tiffany, an American jeweller, in ways that were eye-
often than not they had graduated from the École Nationale d’Ad- brow-raisingly useful for the French luxury champion. But direct
ministration (ena), a finishing school for public officials. patronage is becoming a burden. The French authorities remain a
shareholder in Renault and in 2019 clumsily handled a proposed
Fast forward to today and the cac 40 is led by companies with merger with Fiat Chrysler Automobiles, an Italian-American rival
(whose big shareholder, Exor, owns a stake in The Economist’s par-
ent company). Peugeot, a nimble competitor with no direct state
shareholding, is now in the midst of the merger Renault fluffed.

French whines
Corporate France has plenty of shortcomings. It has no tech giants
to match Google or Amazon. Many large companies with few state
ties, such as Accor, a hotel chain, and Carrefour, a retailer, are de-
cidedly ordinary. The cac 40 was lagging behind its European and
American equivalents even before covid-19 hit the French econ-
omy particularly hard. Its smaller firms pale in comparison to Ger-
many’s Mittelstand. And French politicians, though no longer the
dirigiste master-planners of yore, still pine for national (or Euro-
pean) champions to take on Chinese rivals. They frown on hostile
takeovers—the mere prospect of which serves to sharpen manag-
ers’ minds—which is one reason the Veolia-Suez deal may fail.

That is a shame. Just ask Danone’s shareholders. In 2005 an un-
solicited approach by PepsiCo for Danone was foiled by the French
authorities on the grounds yogurt-making was a strategic indus-
try. The American firm went on its way and has since delivered
fizzy profits for its shareholders. Those at Danone, meanwhile,
have had to stomach far blander returns. 7

Finance & economics The Economist December 12th 2020 69

Productivity trends growth—wringing more output from avail-
able resources—is the ultimate source of
Reasons to be cheerful long-run increases in incomes. It’s not
everything, as Paul Krugman, a Nobel eco-
There are tentative signs that productivity growth might accelerate nomics laureate, once noted, but in the
long run it’s almost everything.
The prospects for a productivity resur- nomic boom in history. A generation ago
gence may seem grim. After all, the past economists had nearly abandoned hope of Economists know less about how to
decade has featured plenty of technologi- ever matching the post-war performance boost productivity than they would like,
cal fatalism: in 2013 Peter Thiel, a venture when a computer-powered productivity however. Increases in labour productivity
capitalist, mused of the technological ad- explosion took place. And today there are (that is, more output per worker per hour)
vances of the moment that “we wanted fly- tantalising hints that the economic and so- seem to follow improvements in educa-
ing cars, instead we got 140 characters”. cial traumas of the first two decades of this tional levels, increases in investment
Robert Gordon of Northwestern University century may soon give way to a new period (which raise the level of capital per work-
has echoed this sentiment, speculating of economic dynamism. er), and adoption of new innovations. A
that humanity might never again invent rise in total factor productivity—or the effi-
something so transformative as the flush Productivity is the magic elixir of eco- ciency with which an economy uses its
toilet. Throughout the decade, data largely nomic growth. Increases in the size of the productive inputs—may require the dis-
supported the views of the pessimists. labour force or the stock of capital can raise covery of new ways of producing goods and
output, but the effect of such contributions services, or the reallocation of scarce re-
What is more, some studies of past pan- diminishes unless better ways are found to sources from low-productivity firms and
demics and analyses of the economic ef- make use of those resources. Productivity places to high-productivity ones.
fects of this one suggest that covid-19 might
make the productivity performance worse. Also in this section Globally, productivity growth deceler-
According to research by the World Bank, ated sharply in the 1970s from scorchingly
countries struck by pandemic outbreaks in 71 Buttonwood: Retail investors high rates in the post-war decades. A burst
the 21st century (not including covid) expe- of higher productivity growth in the rich
rienced a marked decline in labour produc- 72 OPEC’s latest masterplan world, led by America, unfolded from the
tivity of 9% after three years relative to un- mid-1990s into the early 2000s. Emerging
affected countries. 72 Mexico’s unbanked markets, too, enjoyed rapid productivity
growth in the decade prior to the global fi-
And yet, stranger things have hap- 73 Banks get religion on climate change nancial crisis, powered by high levels of in-
pened. The brutal years of the 1930s were vestment and an expansion of trade which
followed by the most extraordinary eco- 74 Free exchange: Geographic bias brought more sophisticated techniques
and technologies to the developing-econ-
omy participants in global supply chains.
Since the crisis, however, a broad-based
and stubbornly persistent slowdown in1

70 Finance & economics The Economist December 12th 2020

2 productivity growth has set in (see chart 1). More innovation needed… 1 bour and tangible capital, and which is
About 70% of the world’s economies have thus interpreted as a decline in productivi-
been affected, according to the World Bank. Productivity, output per worker 6 ty growth. Later, as intangible investments
Accounting for the slowdown is a % change on a year earlier 4 bear fruit, measured productivity surges
fraught process. The World Bank reckons because output rockets upward in a man-
that slowing trade growth and fewer oppor- Emerging economies ner unexplained by measured inputs of la-
tunities to adopt and adapt new technology bour and tangible capital.
from richer countries may have helped de- World 2
press productivity advances in the emerg- Back in 2010, the failure to account for
ing world. Across all economies, sluggish 0 intangible investment in software made
investment in the aftermath of the global little difference to the productivity num-
financial crisis looks a culprit: a particular Advanced economies -2 bers, the authors reckon. But productivity
problem in places with ageing and shrink- 15 18 has increasingly been understated; by the
ing workforces. Yet while these headwinds 1981 85 90 95 2000 05 10 end of 2016, productivity growth was prob-
surely matter, the bigger question is why ably about 0.9 percentage points higher
new technologies like improved robotics, Source: World Bank than official estimates suggested.
cloud computing and artificial intelligence
have not prompted more investment and labour productivity growth appeared to be This pattern has occurred before. In1987
higher productivity growth. accelerating, from an annual increase of Robert Solow, another Nobel prizewinner,
Broadly speaking, three hypotheses just 0.3% in 2016 to a rise of1.7% in 2019: the remarked that computers could be seen
compete to explain these doldrums. One, fastest pace of growth since 2010. everywhere except the productivity statis-
voiced by the techno-pessimists, insists tics. Nine years later American productivi-
that for all the enthusiasm about world- But a third explanation provides the ty growth began an acceleration which
changing technologies, recent innovations strongest case for optimism: it takes time evoked the golden age of the 1950s and
are simply not as transformative as the op- to work out how to use new technologies 1960s. These processes are not always sexy.
timists insist. Though it is possible that effectively. ai is an example of what econo- In the late 1990s, the soaring share prices of
this will turn out to be correct, continued mists call a “general-purpose technology”, internet startups hogged the headlines.
technological progress makes it look ever like electricity, which has the potential to The fillip to productivity growth had other
less plausible as an explanation for the dol- boost productivity across many industries. sources, like improvements in manufac-
drums. ai may not have transformed the But making best use of such technologies turing techniques, better inventory man-
world economy at the dramatically disrup- takes time and experimentation. This ac- agement and rationalisation of logistics
tive pace some expected five to ten years cumulation of know-how is really an in- and production processes made possible
ago, but it has become significantly, and in vestment in “intangible capital”. by the digitisation of firm records and the
some cases startlingly, more capable. deployment of clever software.
gpt-3, a language-prediction model devel- Recent work by Erik Brynjolfsson and
oped by Openai, a research firm, has dem- Daniel Rock, of mit, and Chad Syverson, of The J-curve provides a way to reconcile
onstrated a remarkable ability to carry on the University of Chicago, argues that this tech optimism and adoption of new tech-
conversations, draft long texts and write pattern leads to a phenomenon they call nologies with lousy productivity statistics.
code in surprisingly human-like fashion. the “productivity J-curve”. As new technol- The role of intangible investments in un-
Though the potential of the web to sup- ogies are first adopted, firms shift re- locking the potential of new technologies
port an economy in which the constraints sources towards investment in intangi- may also mean that the pandemic, despite
of distance do not bind has long under- bles: developing new business processes. its economic damage, has made a produc-
whelmed, cloud computing and video- This shift in resources means that firm out- tivity boom more likely to develop. Office
conferencing proved their economic worth put suffers in a way that cannot be fully ex- closures have forced firms to invest in dig-
over the past year, enabling vast amounts plained by shifts in the measured use of la- itisation and automation, or to make better
of productive activity to continue with use of existing investments. Old analogue
scarcely an interruption despite the shut- …but firms are trying 2 habits could no longer be tolerated.
tering of many offices. New technologies Though it will not show up in any eco-
are clearly able to do more than has gener- Share of companies that are likely to adopt nomic statistics, in 2020 executives
ally been asked of them in recent years. selected technologies by 2025, % around the world invested in the organisa-
That strengthens the case for a second tional overhauls needed to make new tech-
explanation for slow productivity growth: 0 20 40 60 80 100 nologies work effectively (see chart 2). Not
chronically weak demand. In this view, ex- all of these efforts will have led to produc-
pressed most vociferously by Larry Sum- Cloud computing tivity improvements. But as covid-19 re-
mers of Harvard University, governments’ cedes, the firms which did transform their
inability to stoke enough spending con- Big-data analytics activities will retain and build on their new
strains investment and growth. More pub- ways of doing things.
lic investment is needed to unlock the Internet of Things
economy’s potential. Chronically low rates The crisis forced change
of interest and inflation, limp private in- Cyber-security Early evidence suggests that some trans-
vestment and lacklustre wage growth since formations are very likely to stick, and that
the turn of the millennium clearly indicate Artificial intelligence the pandemic quickened the pace of tech-
that demand has been inadequate for most nology adoption. A survey of global firms
of the past two decades. Whether this Text, image and voice processing conducted by the World Economic Forum
meaningfully undercuts productivity this year found that more than 80% of em-
growth is difficult to say. But in the years E-commerce ployers intend to accelerate plans to dig-
before the pandemic, as unemployment itise their processes and provide more op-
fell and wage growth ticked up, American Non-humanoid robots* portunities for remote work, while 50%
plan to accelerate automation of produc-
Augmented and virtual reality tion tasks. About 43% expect changes like
these to generate a net reduction in their1
Distributed-ledger technology†

3D/4D printing

Biotechnology

Quantum computing

Source: “The Future of *Eg, drones
Jobs Report”, WEF 2020 †Eg, blockchain

The Economist December 12th 2020 Finance & economics 71

2 workforces: a development which could from America’s coasts, say, then strict zon- None of this can be taken for granted.
pose labour-market challenges but which ing rules in the bay area of California will Making the most of new private-sector in-
almost by definition implies improve- become less of a bottleneck. Office space in vestments in technology and know-how
ments in productivity. San Francisco or London freed up by in- will require governments to engineer a rap-
Harder to assess is the possibility that creases in remote work could be occupied id recovery in demand, to make comple-
the movement of so much work into the by firms which really do need their workers mentary investments in public goods like
cloud could have productivity-boosting ef- to operate in close physical proximity. Be- broadband, and to focus on tackling the
fects for national economies or at the glo- yond that, and politics permitting, the educational shortfalls so many students
bal level. High housing and property costs boost to distance education and telemedi- have suffered as a consequence of school
in rich, productive cities have locked firms cine delivered by the pandemic could help closures. But the raw materials for a new
and workers out of places where they might drive a period of growth in services trade, productivity boom appear to be falling into
have done more with less resources. If tech and the achievement of economies of scale place, in a way not seen for at least two de-
workers can more easily contribute to top in sectors which have long proved resistant cades. This year’s darkness may in fact
firms while living in affordable cities away to productivity-boosting measures. mean that dawn is just over the horizon. 7

Buttonwood C’mon feel the noise

How retail investors often learn the wrong lessons from success

It is better to be lucky than good. This is which is most of them. to good luck by churning their portfolios:
the customary quip of poker players ipo lotteries create a natural experi- they buy more stocks and they also sell
who owe success in a big pot to an im- more. Having ruled out other explana-
probable draw from the deck. In card ment. Some retail investors (the treatment tions the authors plump for the likeliest
games it is usually clear whom fortune group) get shares and some (the control remaining one—that retail investors
has favoured. Not so in investing. The group) do not. The two groups have similar “misinterpret random gains and losses
randomness of financial markets makes characteristics. What separates them is as signals about their own ability”. They
it hard to distinguish a good investor sheer luck. Yet they subsequently behave misconstrue noise as information. They
from a lucky one. It is especially hard for very differently. The treatment group are mistake luck for skill.
people to assess their own skills. more active in trading shares other than
the allocated stock in the period after an This seems to confirm much of the
This long-understood problem has ipo that enjoys a first-day “pop” in its prevailing wisdom about retail inves-
fresh resonance. In the spring no-cost price. Trading volume is 7.4 percentage tors—that they have a habit of over-
brokerages that cater to small investors points higher after two months than for trading to the detriment of their returns
reported a surge in new accounts and in the control group. The difference in trad- and this tendency is linked to over-
trading activity. Many of these newbie ing activity fades over time but is still confidence. It sits comfortably alongside
investors made money. “Learning from marked six months after the ipo. the psychology literature, which says
Noise”, a forthcoming paper in the Jour- people often interpret results in ways
nal of Financial Economics by Santosh Hyperactive trading by lottery winners that are favourable to their self-image.
Anagol, Vimal Balasubramaniam and cannot be put down to their skill at picking But there is a bit more to this study.
Tarun Ramadorai, sheds light on how stocks. After all, lottery losers opt for the Investors, it seems to suggest, might
these investors might misinterpret their same ipo stocks, they pick the same win- suffer from “under-confidence” as well
success. Their study’s main finding is ners, but they do not trade as actively. as overconfidence.
that retail investors who were randomly Lottery winners seem to draw something
allocated shares in successful Indian else from their involvement. Perhaps the Those in the treatment group who
ipos view their good fortune as evidence lived experience of positive returns leads were allocated ipo stocks that went down
of skill. There are dangers for new in- to naive extrapolation—the lesson learned in value on the first day’s trading subse-
vestors in misunderstanding the mar- being that stocks go up, so you should buy quently traded less actively than the
kets. But the bigger hazard might lie in more of them. But lottery winners respond control group. They took bad luck as a
misunderstanding themselves. sign of an absence of skill. The paper also
casts light on how people learn about
India is fertile ground for the study of themselves. The best investors are often
retail investing. Its regulators require introspective, but many people reflect on
companies to set aside up to 35% of the themselves as an external observer
shares issued in an ipo to small share- would—by watching their own actions.
holders. Each ipo has a minimum allot- You notice that you took part in a suc-
ment size. Where there is lots of interest cessful ipo. You then infer from this that
from retail investors, there may not be you must be good at trading stocks.
enough small lots to go round. In such
cases shares are allocated randomly by There are stock traders who are genu-
lottery. The “Learning from Noise” paper inely good and not merely lucky. But the
is based on a sample of 85 of the 240 ipos number of investors who can trade in
that took place in India between March and out of shares frequently and profit-
2007 and March 2012. Of these, 54 were ably is vanishingly small. The “Learning
subject to lotteries. The study’s main from Noise” study shows how easy it
focus is the randomly allocated ipos that might be for you to convince yourself
enjoyed a first-day increase in price— that you are one of them. But it is prob-
ably wise to assume that you are not.

72 Finance & economics The Economist December 12th 2020

Oil production Roll out the barrels 140 places 54%, 82% and 80% of people are
120 banked respectively, despite Mexico being
Opening the taps Crude oil production, January 2012=100 100 richer. Its gdp per person is close to
80 $20,400, around three to four times higher
NEW YORK UAE than in Kenya and India.
Russia
Oil’s cartel may end its age of restraint This shortfall is not just inconvenient.
Saudi Arabia Kuwait Counting cash adds to business costs, and
Cartels exist to exert control. This year those without accounts have little access to
the Organisation of the Petroleum Ex- 60 credit, slowing consumption and invest-
porting Countries (opec) and its allies have ment. The good news is that the country is
occasionally seemed to prefer chaos. In 2012 13 14 15 16 17 18 19 20 improving financial inclusion, says Pablo
March Saudi Arabia and Russia began a Saavedra, who heads the World Bank’s Mex-
price war just as covid-19 crushed demand, Sources: Goldman Sachs Global Investment Research; IEA ico programme. Only 27% of Mexicans had
akin to staging a fight atop a sinkhole. The an account in 2011, but the pandemic has
group agreed in April to slash output, but at (uae), a core opec producer, has aired its made the issue “even more urgent”, he says.
a big meeting in December oil ministers own objections. Like Russia, the uae has
took days longer than expected to decide worked to raise output (see chart). By 2030 There are several reasons why so few
their next steps. The deal that emerged on it hopes production capacity will climb by Mexicans have access to financial services.
December 3rd was a relief to the market, as nearly 25%, to 5m barrels a day. To that end, Banks are generally conservative. Condu-
the group agreed to lift production in Janu- in November it said it had found 24bn bar- sef, the financial watchdog, says bank fees
ary by a modest 500,000 barrels a day. rels-worth of oil tucked beneath Abu in Mexico are high, with 30% of banks’ in-
Dhabi. opec’s new deal reflects an eager- come coming from commissions. In rural
Beyond January, however, opec and its ness to ensure such efforts pay off. The car- areas, branches can be hard to reach. Fur-
allies planned not to plan. Any changes to tel and its allies want to provide oil markets thermore, banks tend not to be interested
production will be decided in monthly with some stability, but not enough to lift in the less well-off: only a fifth of the poor-
meetings. That is in part because it is diffi- output significantly elsewhere and chomp est 20% of Mexicans have accounts. Sur-
cult to predict oil’s recovery. It is also be- at their own market share. “You can’t as- veys show many Mexicans do not trust
cause the new year may mark the begin- sume blindly that opec will always be there banks. Meanwhile, almost 60% work in the
ning of a new strategy. to support prices,” says Damien Courvalin informal sector, where they may receive an
of Goldman Sachs, a bank. inconsistent income, in cash. The lack of
It is a risky time to test new tactics. The access affects some more than others—the
oil market has begun a faltering comeback, That uncertainty may continue to poor, rural, women and indigenous people.
with China refining a record 14.1m barrels a weigh on shale production in 2021, further
day in October and demand picking up in draining investors’ appetite to finance Successive Mexican governments have
India, too. Promising data on vaccines in more capital spending. On December 8th tried to improve access to financial institu-
November helped buoy prices to their America’s Energy Information Administra- tions. In 2018, a law was introduced to regu-
highest levels since March. But storage tion forecast that the country’s oil output late the fintech industry, which is now
tanks and ships are still swollen with some would reach 11.4m barrels a day by the end booming. Under Andrés Manuel López
3.8bn barrels of crude, nearly10% above the of 2021. That is up from 11.2m barrels a day Obrador (known as amlo) CoDi, a digital
level the same time last year, according to in November but still below the 12.2m aver- payment system using qr codes and con-
Kpler, a data firm. Brent crude, the interna- age for 2019. 7 tactless payments was introduced in 2019
tional benchmark, jumped to almost $50 while financial literacy was included in the
on December 4th, after the opec deal. By Mexico’s unbanked school curriculum in September 2020 (cur-
December 8th prices had dipped again, as rently schooling is via television during
optimism about Britain’s covid vaccine Bringing Mexicans the pandemic). Much still needs to be done
roll-out was doused by uncertainty over to account to hit the government’s goal of 65% of Mex-
further lockdowns. icans having an account by 2024.
Financial exclusion will hamper
Yet it is plain that key oil producers are recovery from the pandemic Mexico has also missed a chance pro-
tired of limiting output in ways that sup- vided by the pandemic that other countries
port rivals. Capping production to maxi- For most Mexicans online shopping have seized. Euromoney, a financial publi-
mise prices makes sense in a world of infi- goes like this: people order their goods cation, points out that by the end of June
nitely growing demand and scarce on Amazon or Mercado Libre, an Argentine 2m people in Colombia had opened bank
resources. However oil demand may soon ecommerce site that is Latin America’s big- accounts, compared with 1.4m in all of
peak, if it hasn’t already, due to energy effi- gest, but pay in cash at a convenience store. 2019. Contrast that with Mexico, where the
ciency, electric cars and rising support for That is no surprise given only 37% of Mex- amount of cash in circulation was up by al-
climate regulation. In that context, saving icans over 15 years old have a bank account, most 24% in November compared with the
oil riches for later looks increasingly mis- according to the World Bank. Some 86% of year previously, which the Bank of Mexico
guided. Furthermore, competitors are hap- all payments in Mexico are in cash. attributes primarily to the pandemic. One
py to free ride on opec’s cuts. In 2016 the reason for the difference is that Colombia
cartel and its partners agreed to curb pro- Mexico is an anomaly both in Latin has given handouts to the population,
duction, providing a price support. That America and among emerging-economy which must be deposited into a bank ac-
boosted American frackers and depressed peers such as Kenya and India. In those count, whereas amlo has been far stingier
opec’s market share, from 38% in 2016 to with support during the crisis.
34% last year.
Newer firms in the private sector are
Russia’s reluctance to support Ameri- now driving growth, with online-only and
can oilmen spurred the price war in March. challenger banks seeing a rise in demand
In recent months the United Arab Emirates for their services. Norman Müller, the co-
founder of Fondeadora, a challenger bank
that received $14m from Alphabet’s ven-
ture arm, says of the 250,000 accounts that1

The Economist December 12th 2020 Finance & economics 73

2 have been opened since it launched in June plex. Many methodologies have emerged, the carbon intensity of the global economy
2019, 40% were with people who were pre- each with their own drawbacks. One ap- were the same as a given portfolio. Scien-
viously unbanked (the other 60% were proach tries to capture a portfolio’s carbon tists think the Earth is on course for 3 to 4°C
“unhappily banked”, he says). He puts Fon- footprint. Here, the Partnership for Carbon of warming above pre-industrial levels. Fi-
deadora’s success down to an understand- Accounting Financials (pcaf) is the front- nancial firms that have totted up their port-
ing that “our competitor is cash, not other runner. But the lack of data is a problem; folio found a similar result.
banks” and making the platform as simple small firms rarely disclose emissions.
and transparent as possible. Since almost hsbc says climate-related data are provid- The score depends heavily on the ap-
everyone owns a mobile phone, mobile ed by only 12% of its loan portfolio. proach used, though. A study led by Julie
money should grow, too. Raynaud of McGill University in Canada
The current low level of financial inclu- As a result, pcaf users rely on sector av- looked at 12 different methods. Some of
sion is likely to hamper Mexico’s economic erages to fill in the gaps. Double-counting those included the emissions from a firm’s
recovery from covid-19, which has been is endemic. Take the emissions from an of- supply chain in their calculations, for in-
muted by a failure to control the pandemic. fice block that has a mortgage and is let out. stance, but others did not. Another differ-
For example, small and medium business- They could be counted by the mortgage ence was whether companies were as-
es provide 95% of Mexico’s private-sector lender, any firm financing the companies sumed to hit their net-zero targets. These
employment but only 13% have access to using the office or even a firm financing the kinds of variations led to different results.
formal credit. Under such circumstances city where the office is located. When the same index of low-carbon com-
“it is very hard to see how you have a strong panies was analysed by the 12 methods,
recovery,” says Mr Saavedra. 7 Another complication is divvying up they produced scores ranging from 1.5°C to
emissions between various investors. 4°C—a huge difference, in climate terms.
Climate finance pcaf’s approach is to use enterprise value
(equity plus debt) as a base. A bank lending One hope is that regulators will force
Counting the carbs $10m to a firm with an enterprise value of more rigour. They are worried that climate
$100m would be responsible for a tenth of change poses a systemic risk to the finan-
More financial firms are setting the firm’s emissions. But the value of an as- cial sector and are demanding more infor-
climate targets set changes over time. If a company’s mar- mation on financed emissions. Calculating
ket value increases or if it takes on more the carbon in a portfolio is part of climate
Financial firms produce very few debt, a lender’s share of the enterprise val- stress-tests, which will soon be conducted
greenhouse-gas emissions directly, ue would shrink. The lenders’ carbon foot- in Britain, France and Australia. On No-
aside from those associated with keeping print would fall through no action of its vember 27th the European Central Bank
the lights on and the computers whirring. own. (pcaf says it is working on a fix.) said it will follow suit. A push towards
But the picture changes dramatically when more climate-risk disclosure could even-
you add “financed emissions”, those asso- A second approach to gauging green- tually require financed emissions data to
ciated with a firm’s lending and investing ness is to see whether the portfolio is be published, too.
activities. Figures from the few banks and aligned with the Paris agreement, which
asset managers that disclose them suggest aims to keep warming at less than 2°C Even then, the climate impact of banks
that financed emissions are 100 to 1,000 above pre-industrial levels. The 2 Degrees hitting their targets will be unclear. A study
times bigger than operational ones. Investing Initiative (2dii), a think-tank, by 2dii found that the holdings of coal
looks at the assets and production of port- plants by Swiss financial institutions, as
Financed emissions are now coming folio companies to work out if, say, a car- measured by generating capacity, fell by
under more scrutiny from climate-con- maker is building enough electric vehicles 20% between 2017 and 2020. Yet the coal
scious clients and campaigners, and lend- to meet the Paris goals. But many asset firms found funding elsewhere. By 2020,
ers are hoping to manage the associated classes are not included. the original cohort of firms in the 2017 port-
reputational and regulatory risks. Green folio had increased capacity by 50%. Banks
regulation, for instance, could damage the A third approach assigns a temperature with zero-carbon loan books will attract
viability of an investment. On November score to portfolios. This represents how clients, but may not help the planet. 7
30th Barclays, a British bank, published much the Earth would heat up by 2100, if
plans for its net-zero target. Its goal will be
to cut emissions from deals it arranges in But who lent them the money?
the capital markets as well as on its loans.

In September Morgan Stanley an-
nounced it would reach net-zero financed
emissions by 2050. In October similar
pledges were made by hsbc and JPMorgan
Chase, banks from Britain and America re-
spectively. The Net-Zero Asset Owner Alli-
ance, a group of 30 investors with $5trn of
assets under management, recently set tar-
gets for its members. Advocates hope the
targets will be met either by divesting dirty
assets or pressing polluters to clean up
their act. But matters will not be so simple.

For a start, assessing the emissions as-
sociated with a portfolio is fiendishly com-

74 Finance & economics The Economist December 12th 2020

Free exchange A question of illumination

The problem with economists’ geographical favouritism humanity lives within the world’s ten largest economies.) The
quality and availability of data matter too, though less than eco-
An old joke: a policeman sees an inebriated man searching for nomic size, as does a country’s use of English. About 90% of the pa-
his keys under a lamp post and offers to help find them. After a pers in our sample are written in English.
few fruitless minutes, the officer asks the man whether he’s cer-
tain he dropped his keys at that particular location. No, says the Professional incentives also play a role. An analysis by the
man, he lost them in the park. Then why search here, asks the offi- World Bank of more than 76,000 empirical papers published be-
cer. The man answers: “Because that’s where the light is.” For years, tween 1985 and 2004 found that top-five economics journals pub-
the story has been used to illustrate the simple point, of great rele- lished about 6.5% of all papers written about America over that
vance to social scientists, that what you find depends on where span, compared with just 1.5% of papers about other nations. Top
you look. And for much of its history, economics has examined a economists are more likely to write about America. And even if
very narrow set of countries. An analysis by The Economist of more you adjust for the prestige of the authors’ institutions it does not
than 900,000 papers published in economics journals (see Graph- entirely eliminate the gap.
ic detail), finds that as recently as 1990, roughly two-thirds of pub-
lished papers focused on the rich English-speaking countries: Do countries which receive less attention necessarily suffer as
America, Australia, Britain, Canada and New Zealand. a consequence? The recent increase in developing-world research
has not been an unalloyed good. It has been driven, in part, by the
A boom in the emerging world and a greater focus within eco- rise of the randomised controlled trial—in which scholars ran-
nomics on empirical work have broadened the reach of the lamp- domly assign participants to different groups, only some of which
light. The share of papers mentioning countries in the Middle receive a “treatment” (like a microloan or access to education).
East, Africa, Asia or Latin America has risen from 17% in 1990 to Well-constructed experiments can provide valuable guidance on
41% today. Yet many parts of the world, such as poor African coun- how best to alleviate the worst harms of poverty. Yet critics argue
tries, remain heavily under-studied. Even within regions, some that such trials provide little information about how to generate
places receive outsized attention. A recent survey of Africa by Obie sustained economic development. They also raise ethical ques-
Porteous of Middlebury College found that 65% of papers about Af- tions: regarding whether desperate people and governments can
rican economies published in the leading five economics journals truly give informed consent, for example. As Angus Deaton, a No-
focus on just five: Kenya, South Africa, Ghana, Uganda, and Mala- bel laureate, noted in 2019, such experiments are nearly always
wi. Some overlooked places might count that a blessing; attention conducted “by better-heeled, better-educated and paler people on
from economists has not always been followed by economic suc- lower income, less-educated and darker people”, creating a persis-
cess. But the more of the world that economists study, the better tent risk of exploitation.
their guidance is likely to be. It is thus in everyone’s interest for the
profession to continue to broaden its geographic reach. However, countries dogged by poor policy stand to benefit
most from rigorous examinations of how bad policies fail. Accord-
Patterns of economic research are mostly explained by just a ing to The Economist’s analysis, regional success stories, like Chile
few factors. The size of a country’s economy is the most signifi- or the Czech Republic, receive far more attention than you would
cant, accounting for nearly 80% of the variation in research atten- expect given their underlying characteristics relative to failing
tion, according to our analysis. The importance of economic out- places in the same regions, like Venezuela or Belarus. Reform-
put in shaping research choices has a certain logic. Developed, minded governments in understudied places, should they come to
complex economies provide rich terrain for scholars to explore. If power, could be hamstrung by a dearth of quality research, outlin-
the lessons learned from large economies can be translated into ing how past missteps contributed to present penury. Research bi-
better policy in those places, then such research stands to benefit ases could also mean that too little light is shone on the failures of
more people than if scholars focused on minnows. (About half of interventions by institutions like the imf which may have exacer-
bated the problems of struggling countries.

Attention, please
Indeed, another reason for economists to spend more time on un-
der-examined places is that a broadening of horizons would im-
prove the profession itself, and thus enable economists to serve
governments better. There are too many unanswered questions in
economics for some corners of humanity to receive so little atten-
tion. The 70 least-studied countries account for just 1% of all men-
tions in economics papers over the past three decades.

And while the profession’s increasing focus on empirical work
is welcome, concentrating research within the cone of light that
data provide means that some questions are asked much more of-
ten than others: in particular, those which can be answered with
statistical analysis. An effort to pay more attention to the places
least able to provide high-quality data, which often face the tough-
est roads to development, would force economists to grapple with
qualitative matters. If critical contributions to development come
from difficult-to-quantify variations in cultural factors, a geo-
graphically limited discipline will find it hard to detect them. And
both the world and the profession will be poorer for it. 7

Property 75

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Science & technology The Economist December 12th 2020 77

Hydrogen-powered flight er purposes, such as heating and ground
transport, is getting serious, meaning that
If at first you don’t succeed... hydrogen might become available as a
commodity, rather than having to be made
Some people would like to replace hydrocarbon aviation fuel with hydrogen. specially. The balance of advantage may
Is that actually practical? thus be shifting. So a few brave souls are
looking once again at the idea of hydrogen-
In the swamps of 1950s Florida, a loud tried in the 2000s. A small demonstrator powered flight.
roaring occasionally disturbed the seren- has flown in Germany. But nothing has, as
ity of the local alligators. Under conditions it were, really taken off. Hydrogen, though Project Suntan used the stuff in the way
of strictest secrecy, engineers from Pratt & light, is bulky, making it awkward to store that kerosene is used—to create the heat
Whitney, an aerospace company, were test- on board. It must be either pressurised or needed to power a jet engine. That is one
ing a new type of engine that was powered liquefied, both of which bring complica- way forward. But many planes are driven
by a strange substance apparently piped in tions of their own. On top of that, there is by propellers, and this permits a second ap-
from a fertiliser plant in the nearby town of no established infrastructure for making proach, for propellers can be turned by
Apix. In reality, the town was just a name and distributing it. electric motors. Using fuel cells, a 19th-
on a map and the fertiliser plant was a ruse century technology that is now coming
to fool the Russians. The disturbances were This time it’s different into its own, it is possible to generate the
the result of Project Suntan, an attempt by Now, though, things have changed. Avia- electricity needed to do so with hydrogen.
America’s air force to build a plane fuelled tion is under pressure to curb carbon-diox-
with hydrogen. It nearly worked. The en- ide emissions by burning less kerosene. This is the tack taken by ZeroAvia, a firm
gines operated successfully, but storing And talk of building hydrogen-manufac- based in Cranfield, in southern Britain. In
and supplying the hydrogen itself proved turing-and-delivery infrastructure for oth- September ZeroAvia’s engineers unveiled a
too expensive for production to continue. six-seater fuel-cell-powered aircraft that
Also in this section could take off, complete two circuits of the
Suntan was just the first of a string of airport, and land. The plane in question is a
failed attempts to use hydrogen to power 78 Sonic warfare modified Piper M-class—a single-propeller
heavier-than-air flight. The allure is great. aircraft that is normally driven by a piston
Hydrogen packs three times as much ener- 79 SpaceX’s latest launch engine. The engineers replaced this with
gy per kilogram as kerosene, the current an electric motor, and installed a bank of
standard aviation fuel, and lightness is at a 79 Gene therapy for blindness fuel cells to power that motor and a set of
premium aloft. Tupolev, in what was then tanks to hold the hydrogen which runs the
the Soviet Union, tried in the 1980s. Boeing 80 Bees, hornets and animal dung fuel cells.

Val Miftakhov, ZeroAvia’s boss, hopes to
see this demonstrator take a 400km trip,
tentatively scheduled for the week of De-
cember 21st, followed by a longer flight1

78 Science & technology The Economist December 12th 2020

2 from Orkney, an archipelago off the north- Bigger machines have bigger problems. public policy in Britain, no longer a mem-
ern tip of Britain, next spring. (Orkney’s au- It requires much more power for a plane to ber of the eu but the site of several Airbus
thorities are interested in “hopper” planes take off and land than to cruise, and neither facilities. eu policy in particular translates
that can link the archipelago’s islands.) The batteries nor fuel cells yet have the oomph into actual money for relevant research via
firm also plans to have a 20-seat demon- to do this for other than small aircraft. If the union’s Clean Sky 2 programme.
strator ready in 2021. Certification for com- larger ones are to be hydrogen-powered,
mercial use might follow in 2023. that will require at least part of the work to No such support, either moral or finan-
Hot on the heels of ZeroAvia is H2Fly, a be done by returning to the Project Suntan cial, has been on offer in America over the
spin-off from dlr, Germany’s aeronautical route and employing turbine-driven en- past four years. Joe Biden’s incoming ad-
research centre. In 2016 this firm added fuel gines that burn the stuff as a gas. ministration, however, seems of one mind
cells to a motorised Pipistrel glider, which with Europe on matters environmental.
then stayed aloft for 15 minutes. The plan is That approach is now being adopted by And this new direction is likely, as in Eu-
to extend that approach to a production- Airbus, a European firm which shares with rope, to be accompanied by public money.
version propeller-driven plane in tests to Boeing of America a duopoly on large pas- Boeing, moreover, would be taking a gam-
be conducted imminently. Meanwhile, in senger planes. In September Airbus un- ble by leaving hydrogen-power to Airbus. If
America, an electric-motor manufacturer veiled zeroe, a project centred on three the technology succeeded, it would risk
called magniX has announced a partner- hydrogen-powered concept aircraft. losing an important part of its market—
ship with Universal Hydrogen, a firm in Los Though these are single-aisle short-haul and that is something it certainly cannot
Angeles, to convert a 40-seat de Havilland models, they are a step up from anything afford to do. 7
Canada Dash 8-300 to run on fuel cells. that might be powered solely by fuels cells.
This, they hope, will be ready by 2025. Sonic warfare
Such approaches seem likely to work in All three are designed to yoke the two
principle. They will, though, have to com- hydrogen-based technologies together, A megamegaphone
pete in practice with electric aircraft pow- with hydrogen-burning turbine engines
ered by batteries. In May, an American firm boosting take-off and fuel cells powering Super-loudhailers are about to become
called Aerotec flew a nine-seater Cessna the cruise. One of the concepts is a turbo- louder still
Caravan that had been converted to battery prop that would carry up to 100 passengers
power through the skies above Washington for distances up to 2,000km. A larger tur- You need a pretty powerful bullhorn to
state. The previous December, magniX col- bofan version would take twice that load broadcast a message to someone who is
laborated with Harbour Air, a Canadian twice as far. The third approach is more ex- 2km away. But that is what America’s navy
company, to fly a converted de Havilland perimental: a “blended wing” model, in is currently looking for. It wants, among
seaplane in British Columbia. The two which fuselage and aerofoils form part of other things, to be able to warn the crews of
firms are now busy preparing this aircraft the same triangular aerodynamic struc- small vessels, who may or may not be hos-
for commercial certification. More ambi- ture. The advantage of this is that it creates tile, not to come too close to its ships. And,
tiously, several companies, such as Evia- extra volume for hydrogen storage. if the warning is ignored, it would like to be
tion, an Israeli outfit, are attempting to able to hit them with a noise so piercing
build battery-driven aircraft from scratch The challenges of using hydrogen go be- and horrible that even a determined at-
rather than converting existing airframes. yond body shape, though. Redesigning a tacker would have difficulty ignoring it and
turbine engine to run on the stuff will be a carrying on regardless.
Batteries not included multi-billion-dollar endeavour. Hydrogen
Proponents of fuel cells say, though, that burns faster than kerosene, and also burns To some extent, it can do this already.
these are better than batteries for powering hotter. That means materials exposed to its After USS Cole, a guided-missile destroyer,
flight because the cells plus their associat- combustion experience greater stresses. It was attacked successfully by boat-borne
ed fuel store many times more energy per also risks increasing the pollution generat- suicide-bombers in 2000, ripping a huge
kilogram than batteries can manage. “Bat- ed in the form of oxides of nitrogen, which hole in the vessel’s side (see picture) and1
teries really give you the acceleration. But would partially negate the environmental
they won’t give you the range,” says Robert benefits of burning hydrogen. And it would A breach of security
Steinberger-Wilckens, a chemical engineer be useful as well to arrange matters so that
at the University of Birmingham, in Brit- some of the energy used to compress or liq-
ain. Battery technology is improving, but uefy the hydrogen for storage could be re-
big breakthroughs will be needed before covered and put to work.
longer journeys with passengers and
freight on board become possible. For the next few years, Airbus will focus
on developing the twin technologies of
Sticking electric power sources in an ex- fuel-cells and hydrogen-powered turbines
isting aircraft, whether in the form of bat- in parallel with the design of their future
teries or fuel cells, is a start. But such pro- aircraft. If ground tests succeed, the firm
pulsion could lead to significant redesigns, hopes to have airborne demonstrators—
such as the one Eviation is planning for its what Glenn Llewellyn, Airbus’s vice-presi-
putative product, Alice. This has three pro- dent for zero-emission aircraft, calls flying
pellers, all of which face backward. Though testbeds—aloft by 2025. A full-scale proto-
once popular, backward-facing propellers type would follow by the end of the decade,
have been out of fashion for decades. Elec- with the first zero-emission commercial
tric vertical take-off and landing aircraft— airliner entering service by 2035. Who
people-carrying drones sometimes touted would supply the engines for such a plane
as the future of personal transport—are is not yet clear. But Safran, a French engine-
also often powered by multiple smaller maker that often works with Airbus, has
electric motors, making them a good fit confirmed it is looking at hydrogen power
with fuel-cell-based hydrogen power. for commercial aircraft.

So far, Boeing has not followed suit.
This geographical split may be no coinci-
dence. eu public policy is firmly green, as is

The Economist December 12th 2020 Science & technology 79

2 killing 17 sailors, America’s admirals have lrads, which are used by some police Gene therapy
been understandably nervous about the forces as well as the armed services, are al-
proximity of such craft. One consequence ready controversial. Eyeball to eyeball
of that nervousness is that they have ac-
quired so-called Long Range Acoustic De- Six people, for example, are suing the A failed study, a happy accident and
vices (lrads) to hail possible threats. The New York Police Department for excessive a promising treatment for blindness
current top of the range, the 2000RX, gen- use of force after being exposed to an lrad
erates 160 decibels, while a portable cous- in 2014. They allege lasting damage, in- In the textbooks, science is simple. You
in, the 100X, manages 137. But the navy now cluding tinnitus and migraines. In 2019 a come up with an idea, put it to the test,
wants something that combines the for- federal appeal court took the plaintiffs’ and then accept it or reject it depending on
mer’s power with the latter’s convenience, side and the case continues. And the Amer- what your experiments reveal. In the real
and with a higher fidelity of transmission. ican Speech-Language-Hearing Associa- world, though, things are rarely that
tion, a group of doctors who work in the straightforward, as a paper just published
Now hear this area, warns that lrads could cause perma- in Science Translational Medicine shows. In
The upshot of that desire is a project called nent hearing loss and balance problems, it, a group of researchers led by Patrick Yu-
Focused Enhanced Acoustic-Driver Tech- and advises protesters who might encoun- Wai-Man, an ophthalmologist at Cam-
nologies (feat) for Long Range Non-Lethal ter them to wear hearing protection. In bridge University, investigated a promis-
Hail and Warn Capabilities. This will build June, the mayor of Portland, Oregon, or- ing new genetic therapy for a hereditary
on a previous effort, the Distributed Sound dered police not to use the “warning tone” form of blindness. Officially, their study
and Light Array (dsla), that used eight large function against protesters. was a failure, for their experiment did not
loudspeakers. feat, if the plans work, will show what the researchers hoped it would.
be more compact. More powerful sonic devices could save But it was also a smashing success, for 29 of
lives by conveying warnings to people in the 37 participants reported big improve-
Existing lrads use piezoelectric ele- small boats or vehicles approaching check- ments in their vision.
ments to generate their sound. feat, by points before they behave, possibly mis-
contrast, will be similar to a conventional takenly, in a way that risks their being fired The disease in question is Leber heredi-
loudspeaker—employing a moving mag- on. They could also warn occupants of tary optic neuropathy (lhon). A defective
net to vibrate a diaphragm or cone. This ar- buildings about to be cleared by force, giv- gene in a sufferer’s mitochondria—the tiny
rangement works better at low frequencies ing bystanders a chance to escape before structures that provide a cell’s energy—
than piezoelectric sound generation, the shooting starts, and enemy combatants causes retinal cells to die. That leads to sud-
which is important if voices are to be pro- the option to surrender. However, smaller, den and rapid loss of sight, with many suf-
jected, for lower frequencies make speech cheaper devices may prove more prone to ferers becoming legally blind within a year.1
easier to understand. They are also better at misuse than lrads. And if this new tech-
penetrating buildings and vehicles, to de- nology spills over into the commercial sec-
liver messages to those inside. tor, noisy neighbours could wage their own
kind of sonic warfare. 7
Louder loudspeakers, though, require
stronger magnets and tougher materials. The fiery end of SN8
For the magnets, this may mean a better
version of the neodymium devices cur- “Failure is an option here. If you are not failing, you are not innovating.” So said Elon
rently favoured by the speaker industry, or Musk a few years after he had set up SpaceX, his private rocketry firm. And fail, at the
possibly some more exotic material. For end, his most recent test did. On December 9th SN8, the latest incarnation of SpaceX’s
the diaphragms, the navy’s engineers may Starship, a craft intended as the second stage of a rocket that will be able to carry 100
be looking at graphene, or possibly syn- tonnes of payload, people included, into orbit, and thence to the Moon and Mars, took
thetic diamond. These allotropes of carbon off perfectly from its pad in Boca Chica, Texas. It rose to an altitude of 12.5km, cut its
are both much stronger than conventional three engines and manoeuvred itself parallel with the ground to fall back to Earth. Just
speaker materials. before touch down it restarted its engines and lifted itself upright to land. But it came in
too fast, and the result can be seen above. Nothing daunted, Mr Musk said that the flight
feat will combine the outputs of sever- had provided “all the data we needed” before its RUD. For those not in the know, RUD is
al drivers (the vibrating units that convert SpaceX jargon for “Rapid Unscheduled Disassembly”.
an electrical signal into sound), using a
technique called beamforming to focus
them onto a distant target to create a total
volume of more than 156 decibels. Beam-
forming is widely employed in radio an-
tennae, and the dsla showed that it is
equally effective for sound waves. Lastly,
and perhaps most ambitiously, feat will
include technology intended to cancel at-
mospheric distortion. This approach im-
proves the focus of laser beams, but has not
yet been demonstrated to work for a beam
of sound.

The navy is now selecting contractors
for a nine-month feasibility study. If that
works, the second stage will be to build a
prototype for testing by the marine corps.
Once deployed, the technology will also be
shared with the Departments of Justice,
Homeland Security and others. This will
not be music to everyone’s ears, though, for

80 Science & technology The Economist December 12th 2020

2 It affects between one in 30,000 and one in Bees versus hornets away. But not always. Often, they get inside
50,000 people. Men in their 20s and 30s are and, once there, each hornet kills thou-
particularly susceptible. Treatment is lim- The uses of dung sands of bees. This slaughter paves the way
ited and not particularly effective. for the hornets to gather the real target of
Since most cases are caused by a muta- Chemical warfare in the insect world the attack, the brood of larvae developing
tion in a single gene, lhon is a good candi- in the hive. These, they carry away to feed
date for gene therapy, a form of genetic en- Honeybees in asia have it rough. Un- to their own young waiting back at the nest.
gineering which aims to replace the like their cousins in North America, That obliterates the hive.
defective gene with a working one. With where bee-eating hornets have arrived
that in mind, Dr Yu-Wai-Man and his col- only recently, Asian bees are relentlessly Hornet attacks are devastating to api-
leagues loaded up a modified virus with a hunted by these giant wasps. Constant at- culture, so there is great interest from bee-
corrected copy of the gene and injected it tacks have kicked Asian honeybee evolu- keepers in finding ways to help their char-
into their patients’ eyes. tion into high gear and resulted in the in- ges keep these predators at bay. When Dr
Many viruses can insert their genes into sects developing several defensive tactics Mattila’s co-author Gard Otis, of the Uni-
the dna of their hosts. Ordinarily, that is a besides simply using their stings. First, versity of Guelph, in Canada, learned from
bad thing, because cells so subverted churn Asian honeybees build their nests as for- a beekeeper in Vietnam that bees there
out more copies of the virus. In this case, tresses, with tiny entrances and tough stick globs of water-buffalo dung on their
the hope was that infection would be a walls. They also hiss aggressively at preda- hives after being visited by hornets, it
good thing. The defanged virus could not tors, to warn them they are being moni- therefore piqued his curiosity.
reproduce. But it was capable of replacing tored. And, if that doesn’t work, they can
the damaged gene with a working copy. swamp attackers in “bee balls”, which gen- That, in turn, led Dr Otis, Dr Mattila and
Most medical studies make use of a con- erate such heat that hornets inside are their colleagues to visit Vietnam, where
trol group, against which the effectiveness cooked alive. Now, a study published in they monitored 339 honeybee hives. They
of the treatment can be measured. Here, PLOS ONE, by Heather Mattila of Wellesley discovered that many of these hives were
the researchers controlled the experiment College, in Massachusetts, shows that indeed covered in globs of what looked like
by injecting only one of each patient’s these bees have yet another trick up their manure, and that most of these globs were
eyes—chosen at random—with the virus. sleeves: they shield their homes with dung. clustered around the hive entrance. When
The other eye was given a sham injection, they monitored bees’ movements they dis-
in which a syringe was pressed against the Vespa mandarinia and Vespa soror are covered not only that the bees were collect-
eye, but nothing came out of it. Using two known as murder hornets for a reason. ing buffalo dung, but also that they regular-
eyes in the same patient makes for a perfect When scouts from these species find a ly created globs from faeces collected at a
control: their genetic make-up is identical, honeybee hive they land and leave chemi- chicken coop and a dung pile in a pig enclo-
and any confounding lifestyle factors are cal markers near the entrance. The scouts sure. Further monitoring of the hives
removed from the equation. then return with up to 50 of their kin to showed that the bees quickly attached hun-
launch an attack. Armed with powerful dreds of globs of faeces to their hives after
Cross-eyes jaws and tough body-armour that makes hornet attacks.
The surprise came several months into the them resistant to bee stings, the hornets
study. The researchers had hoped to see a besiege the hive’s entrance and try to tear it Off the mark
big improvement in the treated eyes, com- apart so that they can force their way in. To see whether this was a consequence of
pared with the untreated ones. They did They are attacked by guard bees as they do the chemical marks, Dr Mattila and her col-
not, and for that reason the study failed in so, and are sometimes successfully driven leagues collected extracts from the glands
its primary objective. Instead, in more than hornets use to secrete the substances in-
three-quarters of their patients, they saw Incoming! volved. They then soaked some filter pa-
substantial improvements in both eyes. pers in these extracts and put bits of this
material near hive entrances. As a control,
On the face of it, that was bizarre. Only they also soaked some filter papers in
one eye had received the treatment, after ether, and distributed those likewise near
all. Follow-up studies in monkeys con- the entrances of other hives.
firmed what the researchers had suspect-
ed. The virus, it seems, had found a way to The hornet extract provoked a strong re-
travel from one eye to the other, probably sponse. Within a day of its arrival hive
via the optic nerve. Tissue and fluid sam- members created an average of 15 nearby
ples from monkeys given the same treat- globs. The ether prompted an average of
ment as the human patients showed viral only two. This suggests bees are indeed
dna in both eyes, not just one. wise to the marking tactics of hornets, and
prepare for a potential attack accordingly.
Although it had a happy outcome in this
case, the prospect of a gene-therapy virus To make sure the globs actually do help
travelling to places it is not intended to go bees defend their hives, the team recorded
might worry regulators. Fortunately, the some attacks. A well-globbed-up hive, they
researchers found no trace of the virus found, reduced the amount of time hornets
elsewhere in the monkeys’ bodies, includ- spent trying to break in by 94%.
ing the visual cortices of their brains. And,
though the study was technically a flop, its Why globs of faeces repel hornets re-
practical success means that an effective mains a puzzle. Dr Mattila speculates that
treatment for lhon may at last be in reach. dung contains compounds which antago-
GenSight Biologics, the company that has nise the hornets in some way. Specifically,
developed the treatment, has already sent these would be defensive substances syn-
its results to Europe’s medical regulator. It thesised by the plants that buffalo, pigs and
hopes to hear back by the end of 2021. 7 chickens eat. If that idea does indeed turn
out to be correct, then it seems Asian hon-
eybees have invented an effective form of
chemical warfare. 7

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82 Books & arts The Economist December 12th 2020

Also in this section
83 The Enlightenment
84 Johnson: Accent discrimination
86 William Kentridge’s art

American extremism ous bout of such violence eased only after
an anti-government fanatic, Timothy
Fear and loathing McVeigh, bombed a federal building in
Oklahoma City in 1995, killing 168 people.
Several new books assess the spread and peril of far-right ideas in America
Fractious politics, anger over lock-
How seriously should anyone take Weaponised Words. By Kurt Braddock. downs and Mr Trump’s nudging encour-
Stewart Rhodes and men like him? Cambridge University Press; 302 pages; agement of groups such as the Proud Boys
Speaking online soon after America’s pres- $29.99 and £22.99 have made 2020 worrying, too. The mostly
idential election, he said phalanxes of his Oath Keepers. By Sam Jackson. Columbia peaceful Black Lives Matter protests pro-
armed comrades were waiting outside University Press; 240 pages; $35 and £27 vided cover for both armed vigilantes and a
Washington. Should Donald Trump be Hate in the Homeland. By Cynthia few “accelerationists”, who hope assaults
ousted, they were ready for a “bloody fight”. Miller-Idriss. Princeton University Press; 272 on police will spur a civil war. The fbi re-
pages; $29.95 and £25 ports that amid demonstrations in Minne-
Mr Rhodes is fond of threatening lan- American Zealots. By Arie Perliger. apolis following the death of George Floyd,
guage. In 2016 his group predicted wide- Columbia University Press; 232 pages; a member of the Boogaloo Bois, a far-right
spread voter fraud followed by “catastroph- $28 and £22 group, used an ak-47 to shoot up a police
ic consequences”. It has urged its station, which he then helped burn down.
members, who include ex-soldiers, to help attention, are outright racists and nativ- The “Boog flags are in the air”, he bragged.
patrol the Mexican border to deter and ha- ists, who oppose foreign influences and re- The same man received money from a fel-
rass would-be immigrants. ligions other than Christianity. low Boogalooer who, at roughly the same
time, shot dead a policeman in California.
In his study of the Oath Keepers, as this Mr Jackson’s is one of several new books
outfit is known, Sam Jackson of the Univer- to warn that America’s far right is now Such co-ordination is relatively—and
sity at Albany estimates that some 5,000 more active than at any time since the early thankfully—rare. As Arie Perliger of the
people may have signed up, while many 1990s. The Department of Homeland Secu- University of Massachusetts, Lowell, says,
more sympathise. These folk anticipate a rity agrees, and in testimony to Congress a big weakness of right-wing extremists
second American revolution and claim vi- this autumn the fbi’s director, Christopher has been that they are fragmented into
olence is legitimate to resist what they call Wray, called the far right—and white su- many organisations, or act entirely alone,
tyranny. In the landscape of America’s far premacists in particular—America’s grav- in what amounts to a “leaderless resis-
right they fit into the category of patriot or est domestic-terror threat. Last year, when tance”. In “American Zealots”, a history of
militia groups, defined by their hostility to 48 people were killed in 16 attacks, was far-right violence over 150 years, Mr Per-
government (other than Mr Trump’s). In their most lethal in a generation. A previ- liger finds that solitary attackers have usu-
the typography used by analysts, the other ally been less deadly than those who con-
categories, which usually command more spire and act in concert. That helps explain
why, despite having perhaps12m adherents
or sympathisers in America in total, their
overall impact has been limited.

There are grim exceptions, however,1

The Economist December 12th 2020 Books & arts 83

2 such as the white supremacist who mur- ening strain of the far right. They often Men and brothers
dered11people at a synagogue in Pittsburgh have international links, illustrated by
in 2018, or the fanatic who killed 23 shop- some 17,000 Westerners who went to fight Herder, a German polymath, scorned the
pers in El Paso the following year. Technol- in the conflict in Ukraine. Most eagerly notion of race itself, and saw all peoples as
ogy, such as ever-more destructive weap- share conspiracy theories, especially the related parts of “the same great painting”.
ons, is altering the calculus. And as in the anti-Semitic kind that, for example, vilify In his epic survey of Enlightened minds,
case of the Oath Keepers—who dislike George Soros, a financier. ideas and policies across Europe and the
Muslims and foreigners as well as govern- Americas, Ritchie Robertson deems Hume-
ment—even without formal co-ordina- Ms Miller-Idriss is most interested in style prejudice “indefensible even in its
tion, ideas (and sometimes personnel) are how newcomers are drawn in, including own time”. At least as typical of the era was
shared across the far-right spectrum. through white-power music or mixed mar- the ceramic medallion produced by potter-
Among groups whose avowed focus lies tial arts, notably the “Confederation of Vol- philanthropist Josiah Wedgwood in 1787 to
elsewhere, for instance, racism still tends kisch Fight Clubs”. Some are swayed by a support the abolition of slavery, on which a
to be a factor. Perpetrators typically express lobby that promotes meat-eating and chained African figure pleads: “Am I not a
unease about social change, often raging claims the left “want to take away your man and a brother?” As this masterly book
against people of a different race or, some- hamburgers”. Some teenage boys relish shows, Wedgwood’s brooch better encap-
times, a different religion or sexuality. Al- dark humour and internet memes, often sulates the mood of the age: its universal
most all are white men, often poor and bad- involving the Nazis (“baking pizzas” is a principles, wide-ranging sympathy, social
ly educated. Whereas the South was preferred euphemism for the Holocaust). activism—and commercial nous.
historically the epicentre of these crimes, The sharing of taboo material is, for many,
they now happen wherever sizeable num- the start of a path towards extremism. The Enlightenment argued fiercely with
bers of African-Americans, Hispanics and itself, in terms still in use. When today’s
Asians live. (Tellingly, the Oath Keepers, She is struck by the neatly pressed trou- Westerners quarrel over race, empire, gen-
the Three Percenters and other anti-gov- sers and white polo shirts of young men der, religion, science, the state or the mar-
ernment groups were founded as Barack who marched in Charlottesville in 2017, ket, they often do so with weapons and tac-
Obama became president.) chanting “Jews will not replace us”. Others, tics honed three centuries ago. Or more: in
whom she calls “Nipsters”, or Nazi hip- 1673 the maverick pastor François Poulain
From meat to murder sters, sell and wear expensive clothes em- de la Barre wrote in “On the Equality of the
Like demographic anxieties, other factors broidered with white-supremacist and Two Sexes” that “there is no such thing as
are perennial yet especially acute at the other symbols. Such “hate clothing”, Ms sex”. Yet revisionists like to frame the hey-
moment. Kathleen Belew of the University Miller-Idriss says, makes the movement day of the writers, scholars and progressive
of Chicago has traced how militia groups more palatable and appealing than did the rulers presented here as “the apotheosis of
grow when soldiers return home. The Ku skinheads and neo-Nazis of the past. hyper-rational calculation”. Supposedly,
Klux Klan flourished after previous wars, their influence disenchanted the world
she notes. Deploying large numbers of The real threat from the far right, her re- and seeded a motley harvest of modern
troops to Iraq, Afghanistan and elsewhere search suggests, is not that groups such as evils from neoliberalism to Stalinism.
over two decades has contributed to an up- the Oath Keepers will launch large-scale
tick in violent activity now. Ms Belew sug- political violence, let alone a new civil war. Mr Robertson begs to differ. A professor
gests America is “heading to an uphill The bigger worry is the “mainstreaming of of German at Oxford, he is a champion of
peak” in far-right ructions. extremism”: the spread of hateful and viol- the thinkers who promoted “the advance of
ent attitudes so that ever-more people reason, good sense and empirical enquiry”
Rhetoric matters, too, especially as it share and promote them. 7 against superstition and tyranny, from the
spreads online. In “Weaponised Words”, late 17th century until the French revolu-
Kurt Braddock of American University Intellectual history tion. Isaac Newton’s gravitation, Adam
traces how the language of extremists at- Smith’s political economy, Jean-Jacques
tracts recruits. But, he says, the words of Pleasure principles Rousseau’s cult of sentiment—indeed,
politicians may be just as dangerous. Mr Hume’s outrageous near-atheism—all fea-
Braddock warns that Mr Trump and his al- The Enlightenment. By Ritchie Robertson. ture. But Mr Robertson lays special stress1
lies have stirred up talk of resistance to a Allen Lane; 1,008 pages; £40. To be published
“deep state”; he was dismayed when Steve in America by Harper in February; $45
Bannon, the president’s former adviser,
talked on Twitter about decapitating Mr In september the University of Edin-
Wray. Some fantasists act on such words. In burgh expunged the name of David
October the fbi arrested a group in Michi- Hume from an ugly teaching block. In re-
gan who spent months planning to kidnap sponse to a student petition, the university
(and maybe kill) its governor, Gretchen agreed that the views of the 18th-century
Whitmer, and others. They may have been thinker on the possible inferiority of non-
encouraged by Mr Trump’s disparagements white races, voiced in a tentative footnote
of her and his call to “liberate” the state. to his essay “Of National Characters”,
“rightly cause distress today”. Thomas Jef-
Similarly, in “Hate in the Homeland” ferson, a slave-owner, used almost identi-
Cynthia Miller-Idriss describes how ideas cal language. So did Immanuel Kant.
once limited to extremist circles, such as
that of a “demographic replacement”— In contrast, many thinkers of the En-
whereby American citizens will be over- lightenment argued forcefully for the “ba-
run—are now promoted by mainstream sic unity of humankind”. Johann Gottfried
figures such as Tucker Carlson and Laura
Ingraham of Fox News. She concentrates
on the estimated 75,000 active white su-
premacists who comprise the most threat-

84 Books & arts The Economist December 12th 2020

2 on the pursuit of happiness boldly invoked “Man is born to live in society,” affirmed thought big. They wrote long. The “Ency-
in the American rebels’ Declaration of In- Denis Diderot, tireless instigator of the clopédie”, that “vast panorama of knowl-
dependence. That led to the first purpose- French “Encyclopédie” (1751-72) and a ubiq- edge”, crams 72,000 articles into 17 vol-
built Enlightenment state—“a very British uitous, uplifting presence in these pages. umes. The “Histoire des deux Indes” (1770),
affair” in its intellectual foundations. “The Meanwhile, no priest or despot should cur- a monument to cosmopolitan idealism by
ultimate end of man is happiness,” claimed tail the liberty of thought enjoyed by beings Diderot and Guillaume Raynal, which doc-
Rousseau’s fellow-Genevan Jean-Jacques endowed with, in Kant’s words, “the uni- uments colonial crimes, runs to 4,353
Burlamaqui. By itself reason (which must versal religion of reason that dwells in ev- pages. Mr Robertson’s 1,000-page whopper
anyway be “slave of the passions”, insisted ery ordinary person”. Slowly, grudging tol- imbibes something of the spirit of these
Hume) would not ensure felicity. erance gave way to a warmer embrace of mammoth compendia. Not every reader
So Enlightened happiness became a so- cultural diversity, given its theoretical will choose to plough straight through,
cial task, and an art, pursued not just in the framework in Montesquieu’s pathbreaking from John Locke advocating “the enjoy-
study but the laboratory, library, university, “Spirit of the Laws”. ment of pleasure” in 1690 to Hanif Ku-
printing-house, coffee-shop and Congress. reishi, a modern author, saluting Enlight-1
Enlightenment intellectuals not only

Johnson Eiffel power

The rights and wrongs of a French bid to ban accent discrimination

In the early 1790s French revolu- when in the capital or on television. that it would send a powerful signal:
tionaries commissioned a priest, Henri And French leaders face more than just there is no rational reason to withhold a
Grégoire, to take a census of the lan- job or a loan because of an applicant’s
guages spoken in France. His findings condescension. When Jean Castex, who accent. But a specific ban on accent
were eventually titled a “Report on the has a notable south-western accent, be- discrimination may not be necessary.
necessity and means to annihilate the came prime minister, reactions were Donald Dowling, a lawyer at Littler Men-
patois and to universalise the use of the predictably patronising. But such snob- delson in New York, points out that, in
French language”. Grégoire was a pio- bery can have serious consequences, notes many countries, accent mockery is al-
neering believer in racial equality, a fact Jonathan Kasstan of Westminster Univer- ready used as evidence of other forms of
that may seem to fit oddly with his pas- sity. The political editor of France’s nation- illegal discrimination, such as the racial
sion for eradicating linguistic diversity. al broadcaster said Mr Castex’s pandemic kind. If you deride a Frenchman for an
But to him, it made sense: French was the guidance seemed less credible when deliv- accent suggesting African origins, you
language of liberation, and those with- ered in his “patelin”, or village, accent. are already breaking the law. In theory
out it could be kept in ignorance. that law could be extended to cover (say)
In truth, some other countries are more Breton origins without specifically add-
How very French, their British cous- like France than they may think. Beyond ing “accent” to protected categories.
ins might chuckle. The same people who the bbc, it remains common in Britain to
introduced the metric system and (un- hear public figures belittled for how they In the end, prejudice against accents
successfully) tried to replace the Gregori- speak. The liberal left indulges these prej- betrays bad manners and small minds,
an calendar can seem to have a mania for udices, too. Alastair Campbell, erstwhile and says more about the listener than
top-down reform and standardisation. press secretary to Labour’s Tony Blair, about the put-upon speaker. But often it
Now some Britons are chuckling to see mocked the Conservative home secretary, is itself a sign of poor education. As it
this approach enlisted in the name of Priti Patel, on Twitter: “I really would happens, Mr Campbell’s swipe at Ms
tolerance: on November 26th the Nation- prefer it if we had a home secretary who Patel’s “g-dropping” was badly aimed.
al Assembly passed a law forbidding could pronounce the G at the end of a There is no actual “g” sound (as in “go”) at
accent discrimination. If it gets through word.” Here snobbery is dressed up as the end of words ending in -ing; rather,
the French Senate, severe cases—say, concern for correct enunciation. there is a “velar nasal”, in which the
denying someone a job because of how mouth is closed off at the back and air
they speak—could result in three years in But is a ban on such gibes the answer, comes from the nose. And the -in’ pro-
prison, or a fine of €45,000 ($55,000). in France or elsewhere? The case for one is nunciation he mocks (as in walkin’) was
How very French. the “correct” one for centuries, remain-
ing prestigious in the early 1900s.
The country certainly has biases to
amend. In America regional accents can If more of this were taught in British
be heard in the highest office in the land schools, snobbery would seem irratio-
(Donald Trump’s New York, George W. nal. French children might be told that
Bush’s Texan). In Britain the bbc has Parisian French was a latecomer, as
expanded the variety of accents heard on prestige dialects in France go. Provençal,
its broadcasts. By contrast, regional from France’s south, was the language of
accents in France are far tougher to find poetry when the speech of Paris’s Île-de-
in high places. This makes it harder for France region was a trivial local patois.
the French to associate intelligence and
competence with anything but standard Speakers of prestigious accents are
Parisian. At best French politicians, like lucky that they do not face scorn for their
some elsewhere, switch between their speech. But it is just that—luck, not
local accent when in the areas they repre- superior learning or care. A law may
sent and the standard Parisian kind modify behaviour, but education is a
better way to change attitudes.



86 Books & arts The Economist December 12th 2020

2 enment liberation from outmoded smeared floor, gunky paint tubes and mat- shared on his laptop on a flying visit to Lon-
orthodoxies in 2019. Those who do will find ted brushes—that after his death the room don, opens with a meditation on a 19th-
that Mr Robertson sweetens erudition with was painstakingly reconstructed (in 7,000 century painting of hills and a stream that
humanity, much as his subjects did. pieces) in Dublin City Gallery. It was as if hung in his grandparents’ dining room.
This Enlightenment celebrates what his environs could immerse visitors in Ba- Next come memories of a picnic with his
Robert Burns, appalled by the suffering of a con’s thinking. parents, involving sardines, boiled eggs
shot hare, called “the morality of the heart”. and a flask of coffee. The artist argues with
Science and statecraft, which are amply For his part, Mr Kentridge headed to a himself about small details of the spread,
chronicled, yield to compassion, sympathy building at the bottom of his garden and as if he were a pair of squabbling siblings.
and a self-critical outlook that welcomes began a “natural history of the studio”, a Then he takes the viewer through a new
experimentation and changes of mind. Not long-cherished project about the alchemy landscape: the mine dumps that rise out of
least among its lessons for today, “The En- of art. “One can think of the studio as a kind the flat veldt around Johannesburg, sym-
lightenment” shows how its sages learned of enlarged head,” he says. “Instead of ideas bols of apartheid’s political economy, and
“to manage even Disputes with Civility”. 7 moving a few centimetres from one part of the digs of zama-zamas, freelance miners
your memory to your active thinking, it’s who scratch out overlooked crumbs of
Contemporary art the walk across the studio that has the gold. Whose land is this, he seems to ask,
same effect of bringing ideas together and and who determines its history?
The room where it allowing something to emerge.”
All this is done with only charcoal and a
happens His art-loving parents were both anti- smudging cloth, a sequence of minutely
apartheid lawyers and civil-rights activ- different drawings on one palimpsestic
At 65, William Kentridge is about to ists; his father defended Nelson Mandela sheet of paper that, once filmed, have the
unveil his most mesmerising work in the “treason trials” of 1956-61. As South immediacy of early animation. With edit-
Africa moved from pariah state to rainbow ing by Walter Murch, an American who
Even as he first made his name with his nation and beyond, Mr Kentridge sought worked on “The Godfather” and “Apoca-
charcoal drawings in the 1970s and new ways to depict its contested history, lypse Now”, the effect is layered and theat-
1980s, William Kentridge resented the lim- environment, injustices and depredations. rical. Mr Kentridge adds performance: im-
itations of his craft. To the young artist he From his “Soho Chronicles” (short animat- provised music by Kyle Shepherd, a pianist
was then, working on his own in a studio in ed films) to his productions of Alban Berg’s and composer from Cape Town, in which
South Africa felt stifling. So he branched early-20th-century operas, “Wozzeck” and the piano strings are blocked with bits of
out, turning his drawings into filmed ani- “Lulu”, his themes have been memory, wood or bound in foil paper to create
mations that brought them to life, then landscape, power, the study of the self and sounds that echo the axe and the bulldozer.
into performances with music and move- how individuals forge their fates. Then he introduces a Zulu chorale by
ment, and eventually into complex multi- Nhlanhla Mahlangu, a long-time collabo-
media installations. He produced operas The new project will comprise 12 films, rator, about being forced off the land. For
for the Salzburg Festival and the Metropol- each lasting 40 to 45 minutes, far longer Mr Kentridge, sound can convey memory,
itan Opera in New York. and more imaginative than any he has and the essence of South Africa’s land-
made before. So far, he has completed four. scape, as much as visual imagery.
What he loved most was collaborating— Using an old 16mm Bolex on a tripod, he
with film-makers, theatre companies, mu- films himself in conversation with him- In 2022 he will emulate Ai Weiwei and
sicians. In 2016 he took over the building self, or with two other versions of himself, Anselm Kiefer and take over the Royal
next to his big industrial studio in down- unpicking the artistic process. He can be Academy in London for a retrospective of
town Johannesburg and created an incuba- the artist-as-maker, clutching a chunk of his career. He hopes all his new films, col-
tor for performers called the Centre for the charcoal and sketching at high speed like a lectively to be called “Studio Life”, will be
Less Good Idea. The name came from a conductor; or the artist-as-critic, assessing shown together. Even now, though, he sees
Tswana proverb about the value of working his creation from afar. “Suddenly”, he says, himself as merely the initiator of his art.
things out together—and how the first, fiz- “you’re a very different person.” His collaborators turn it into something
ziest brainwave may in the end prove less new and, with their own memories and
productive than a humbler idea. Combined with snapshots of his own connections, so do his audience. 7
past, and of South Africa’s, this dialogue is
Most evenings, when he is in town, Mr mesmerising. The first film, which he
Kentridge can be found at the centre, guid-
ing, rehearsing and experimenting with The alchemy of the studio
young performers. Six months ago,
though, after he, his wife and numerous
colleagues caught covid-19, he was forced
to retreat into making art on his own.

The role that solitary labour plays in
creativity has long fascinated artists and
historians. Lucio Fontana, an Italian-Ar-
gentine conceptual artist famous for his
“slashed” canvases, allowed a photogra-
pher to shoot him at work, but only until
the knife was poised to touch the canvas;
then Fontana insisted on being completely
alone. The studio, for him, was a sacred
space. Such was the chaos and energy of
Francis Bacon’s studio in London—with its

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88 Economic & financial indicators The Economist December 12th 2020

Economic data

Gross domestic product Consumer prices Unemployment Current-account Budget Interest rates Currency units
balance balance
% change on year ago % change on year ago rate 10-yr gov't bonds change on per $ % change
% of GDP, 2020† % of GDP, 2020†
latest quarter* 2020† latest 2020† % latest,% year ago, bp Dec 9th on year ago

United States -2.9 Q3 33.1 -3.8 1.2 Oct 1.2 6.7 Nov -2.3 -14.9 0.9 -88.0 -
China 4.9 Q3 11.2 1.8 1.7 -5.6 3.1 §§ 14.0 6.54
Japan -5.7 Q3 22.9 -5.3 -0.5 Nov 2.9 4.2 Q3§ 2.6 -11.3 nil -8.0 104 7.7
Britain -9.6 Q3 78.0 -11.3 -1.5 -19.4 0.4 -42.0 0.75 4.2
Canada -5.2 Q3 40.5 -5.8 -0.4 Oct 0.1 3.1 Oct -2.1 -13.4 0.8 -84.0 1.28 1.3
Euro area -4.3 Q3 60.0 -8.0 2.2 -9.1 -0.6 -31.0 0.83 3.1
Austria -4.0 Q3 54.6 -6.7 0.7 Oct 1.0 4.8 Aug†† 1.4 -8.0 -0.5 -39.0 0.83 8.4
Belgium -4.5 Q3 54.2 -7.9 -1.1 -9.7 -0.4 -38.0 0.83 8.4
France -3.9 Q3 98.3 -9.5 0.7 Oct 0.7 8.5 Nov -1.9 -10.7 -0.3 -37.0 0.83 8.4
Germany -4.0 Q3 38.5 -5.4 6.9 -7.0 -0.6 -31.0 0.83 8.4
Greece -9.6 Q3 9.5 -9.0 -0.3 Nov 0.3 8.4 Oct -4.0 -8.2 0.6 -82.0 0.83 8.4
Italy -5.0 Q3 80.4 -9.1 2.6 -11.0 0.5 -86.0 0.83 8.4
Netherlands -2.5 Q3 34.5 -6.0 1.3 Oct 1.1 5.4 Oct 7.0 -6.0 -0.6 -43.0 0.83 8.4
Spain -8.7 Q3 85.5 -12.7 0.5 -12.3 nil -44.0 0.83 8.4
Czech Republic -5.2 Q3 30.7 -7.0 0.5 Nov 0.4 5.1 Oct -0.5 -7.7 1.3 -17.0 21.8 8.4
Denmark -4.2 Q3 21.1 -5.0 9.0 -4.8 -0.5 -22.0 6.16 5.9
Norway -0.2 Q3 19.7 -1.7 0.2 Nov 0.5 8.6 Oct 3.2 -1.3 0.9 -58.0 8.82 9.6
Poland -1.8 Q3 35.5 -3.4 2.6 -7.9 1.4 -60.0 3.67 3.6
Russia -3.6 Q3 na -3.8 -0.3 Nov 0.4 4.5 Oct 1.9 -4.3 6.1 -43.0 73.8 5.5
Sweden -2.7 Q3 21.2 -3.2 4.2 -3.6 nil -7.0 8.49 -13.7
Switzerland -1.6 Q3 31.9 -3.0 -1.8 Oct -1.4 16.8 Aug 9.2 -3.7 -0.5 6.0 0.89 12.3
Turkey 6.7 Q3 na -3.6 -4.5 -5.1 12.8 64.0 7.82 11.2
Australia -3.8 Q3 14.0 -4.1 -0.2 Nov -0.1 9.8 Oct 0.8 -7.9 1.0 -12.0 1.34 -25.7
Hong Kong -3.5 Q3 11.8 -5.6 5.6 -6.0 0.8 -88.0 7.75 9.0
India -7.5 Q3 125 -9.8 0.8 Nov 1.1 3.8 Mar 0.7 -7.8 5.9 -74.0 73.6 1.0
Indonesia -3.5 Q3 na -2.2 -1.4 -7.1 6.2 -91.0 14,110 -3.4
Malaysia -2.7 Q3 na -5.3 -0.8 Nov -0.3 16.2 Oct 4.8 -7.2 2.8 -68.0 4.06 -0.7
Pakistan 0.5 2020** na -2.8 -0.4 -8.0 9.9 ††† -133 160 2.5
Philippines -11.5 Q3 36.0 -9.3 2.9 Oct 3.2 2.9 Oct‡ 0.5 -7.7 3.1 -154 48.1 -3.4
Singapore -5.8 Q3 42.3 -6.0 17.8 -13.9 0.9 -81.0 1.34 5.7
South Korea -1.1 Q3 8.8 -1.1 0.4 Oct 0.4 4.6 Oct 3.9 -5.6 1.7 -1.0 1,085 1.5
Taiwan 3.9 Q3 16.6 2.4 13.7 -1.5 0.3 -35.0 28.2 9.7
Thailand -6.4 Q3 28.8 -5.9 1.7 Oct 1.4 5.2 Sep‡‡ 3.1 -6.4 1.2 -27.0 30.0 8.0
Argentina -19.1 Q2 -50.7 -11.3 2.4 -9.2 na -464 82.0 0.9
Brazil -3.9 Q3 34.6 -5.2 3.0 Nov 3.4 6.1 Oct§ -0.4 -15.9 2.0 -257 5.13 -26.9
Chile -9.1 Q3 22.6 -5.9 1.7 -8.2 2.9 -76.0 739 -19.1
Colombia -9.5 Q3 39.6 -7.3 4.4 Nov 3.3 6.3 Oct§ -4.6 -8.8 4.9 -113 3,458 4.3
Mexico -8.6 Q3 58.0 -9.0 1.7 -5.3 5.3 -159 19.8 -1.2
Peru -9.4 Q3 187 -12.0 0.3 Oct 0.4 7.8 Oct§ -0.1 -8.0 3.8 -40.0 3.60 -2.9
Egypt -1.7 Q2 na 3.6 -3.3 -8.8 na 15.7 -6.1
Israel -1.9 Q3 37.9 -4.0 -0.7 Nov -0.9 3.4 Nov 3.8 -11.1 0.9 nil 3.25 2.7
Saudi Arabia 0.3 2019 na -4.2 -3.9 -10.9 na 1.0 3.75 6.8
South Africa -6.0 Q3 66.1 -7.7 14.0 Nov 12.1 13.2 Aug§ -2.1 -16.0 8.9 nil 15.0 nil
57.0 -2.1
0.7 Q3 0.7 7.0 Oct

-0.1 Oct 0.4 6.4 Oct‡‡

7.6 Oct 6.5 6.5 Nov

1.6 Nov 2.0 7.1 Q3§

-1.5 Oct -1.1 4.6 Sep§

8.3 Nov 9.8 5.8 2018

3.3 Nov 2.6 8.7 Q4§

-0.2 Oct -0.3 3.6 Q3

0.6 Nov 0.5 3.7 Oct§

0.1 Nov -0.3 3.8 Oct

-0.4 Nov -0.8 2.1 Oct§

37.2 Oct‡ 42.0 13.1 Q2§

4.3 Nov 3.1 14.6 Sep§‡‡

2.7 Nov 3.1 11.6 Oct§‡‡

1.5 Nov 2.6 14.7 Oct§

3.3 Nov 3.5 3.3 Mar

2.1 Nov 1.8 15.7 Oct§

4.6 Oct 4.9 7.3 Q3§

-0.8 Oct -0.6 4.7 Oct

5.8 Oct 3.5 9.0 Q2

3.2 Nov 3.3 30.8 Q3§

Source: Haver Analytics. *% change on previous quarter, annual rate. †The Economist Intelligence Unit estimate/forecast. §Not seasonally adjusted. ‡New series. **Year ending June. ††Latest 3 months. ‡‡3-month moving
average. §§5-year yield. †††Dollar-denominated bonds.

Markets Commodities

% change on: % change on:

Index one Dec 31st index one Dec 31st The Economist commodity-price index % change on
Dec 9th Dec 9th week 2019
In local currency week 2019 2015=100 Dec 1st Dec 8th* month year
3,672.8 42,204.0 0.4 3.6
United States S&P 500 12,339.0 0.1 13.7 Pakistan KSE 2,843.1 1.1 -11.8 Dollar Index
United States NAScomp 3,372.0 -0.1 37.5 Singapore STI 2,755.5 3.0 25.4
China Shanghai Comp 2,250.8 -2.2 10.6 South Korea KOSPI 14,390.1 2.9 19.9 All Items 139.2 143.5 8.5 26.3
China Shenzhen Comp 26,817.9 -1.7 30.6 Taiwan TWI 1,482.7 4.6 -6.2
Japan Nikkei 225 1,779.4 0.1 13.4 Thailand SET 51,956.9 -6.0 24.7 Food 111.7 109.8 nil 10.0
Japan Topix 6,564.3 0.3 3.4 Argentina MERV 113,001.2 1.0 -2.3
Britain FTSE 100 17,559.9 1.6 -13.0 Brazil BVSP 42,737.0 -2.1 -1.8 Industrials
Canada S&P TSX 3,529.0 1.2 2.9 Mexico IPC 11,018.1 nil -21.1
Euro area EURO STOXX 50 5,546.8 0.2 -5.8 Egypt EGX 30 1,531.1 3.3 -5.3 All 165.0 174.9 14.1 38.3
France CAC 40 13,340.3 -0.6 -7.2 Israel TA-125 8,660.2 -0.4
Germany DAX* 21,969.6 0.2 0.7 Saudi Arabia Tadawul 59,291.8 1.7 3.2 Non-food agriculturals 116.1 118.0 8.5 17.9
Italy FTSE/MIB South Africa JSE AS 2,627.5 0.5 3.9
Netherlands AEX 619.7 nil -6.5 World, dev'd MSCI 1,255.9 2.2 11.4 Metals 179.5 191.8 15.2 42.8
Spain IBEX 35 8,235.3 1.4 2.5 Emerging markets MSCI 12.7
Poland WIG 56,632.7 0.2 -13.8 Sterling Index 159.0 163.9 7.6 24.5
Russia RTS, $ terms 1,372.5 4.9 -2.1 All items
Switzerland SMI 10,430.0 2.8 -11.4
Turkey BIST 1,350.3 -0.1 -1.8 Euro Index 128.3 131.4 5.9 15.6
Australia All Ord. 6,965.4 1.9 18.0 All items
Hong Kong Hang Seng 26,502.8 2.3 2.4
India BSE 46,103.5 -0.1 -6.0 Gold 1,810.1 1,867.2 -0.9 27.6
Indonesia IDX 5,944.4 3.3 11.8 $ per oz
Malaysia KLSE 1,646.5 2.2 -5.6
3.0 3.6 US corporate bonds, spread over Treasuries Brent 47.5 49.0 12.1 -24.1
$ per barrel

Basis points latest Dec 31st Sources: Bloomberg; CME Group; Cotlook; Refinitiv Datastream;
Investment grade 140 2019 Fastmarkets; FT; ICCO; ICO; ISO; Live Rice Index; LME; NZ Wool
High-yield 438 Services; Thompson Lloyd & Ewart; Urner Barry; WSJ. *Provisional.
141
449

Sources: Refinitiv Datastream; Standard & Poor's Global Fixed Income For more countries and additional data, visit
Research. *Total return index. Economist.com/indicators

Graphic detail Economic research The Economist December 12th 2020 89

→ Big economies get the most research. But economists prioritise countries with abundant data, and ignore petro-states

Share of mentions* in economics papers v GDP Mentions, Mentions* relative to expected
Papers with abstracts available in English, 1990-2019, log scale % of total From average GDP, 1990-2019

100

Average population United Fewer Expected More No data
1990-2019, m States 4x 3x 2x 1x 2x 3x 4x

5 50 500

10

Britain China
India

South Africa Turkey Brazil Japan 1
Pakistan Germany

↑ More than Slovenia Russia
expected Kenya Indonesia

Malawi Belgium 0.1 Predictors of a country’s share of mentions*
Egypt Change in share of mentions from one-standard-deviation
increase in variable, % points
Saudi Arabia
-0.5 0 0.5 1.0 1.5 2.0 2.5
Fiji Venezuela
Algeria
Somalia ↓ Fewer than
Angola expected

Tonga Libya 0.01 GDP
Turkmenistan
Grenada Bahamas Data availability ↑ GDP is the strongest
predictor of a country’s
Tuvalu Andorra English is an share of research
official language
Monaco 0.001 95% confidence
San Marino Students in the
Marshall Islands United States

Expected Official language Ease of doing
Includes English business

10m 100m 1bn 10bn 100bn 1trn 10trn 0.0001 Oil rents as
100trn % of GDP

Average GDP, $†, 1990-2019 Sources: American Economic Association; World Bank; Encyclopedia Britannica; Institute of
International Education; government websites *Articles mainly about a country †2020 prices

Starving for tracks papers with abstracts in English, the one of EconLit’s highest papers-to-gdp ra-
knowledge field’s lingua franca, causing it to under- tios, stem from universities in Maribor and
represent studies intended for non-Anglo- Ljubljana that churn out articles in English.
Economists look at more than gdp phone audiences. However, EconLit does
when choosing countries to study include 110,000 papers in other languages To adjust for such factors, we built a sta-
with abstracts translated into English. tistical model to predict a country’s share
Economic research can reverberate be- of studies in each year. gdp remained the
yond the ivory tower. In 2003 a study of By far, the best predictor of the amount most important variable, though it mat-
Kenyan schools found that treating intesti- of research conducted on a country was its tered less in oil-rich states. The next-best
nal worms improved attendance. After gdp. However, economic size leaves many predictors of popularity in the Anglophone
similar work confirmed the policy’s bene- cases unexplained. Kenya gets three times database were listing English as an official
fits, one author, Michael Kremer, founded more articles than its gdp suggests; Algeria language and sending lots of students to
an ngo that treats 280m children a year. has one-quarter as many as expected. American universities (boosting places
like China). Variables that capture data
Mr Kremer’s work was unusually im- Such outliers often cluster in research availability, such as the number of World
pactful, but reflects a pattern of research “oases” or “deserts”. Obie Porteous of Mid- Development Indicators a country pub-
improving policy. One study found that dlebury College notes that studies of Africa lishes, also had meaningful effects.
telling Brazilian mayors about the gains are disproportionately concentrated in the
from sending reminder letters to taxpayers continent’s south and east. Expanding this These factors improved the model a lot.
sharply increased their chances of doing analysis worldwide, we find that the Mid- They explained most of the difference be-
so. Yet many similar countries attract far dle East and parts of Latin America get rela- tween Kenya and Algeria, for example.
fewer studies. This can leave policymakers tively few papers with English abstracts. After incorporating them, we found that a
fumbling in the dark (see Free exchange). China and Russia also seem under-studied. country’s spending on universities, form
of government and involvement in armed
To measure this problem, we turned to In contrast, South Asia and some re- conflicts did not yield additional accuracy.
EconLit, a database curated by the Ameri- gions in eastern Europe were oases. Like
can Economic Association with 910,000 much of southern and eastern Africa, India For policymakers in research deserts
journal articles from 1990-2019. It only and Pakistan were colonised by Britain. To- who want academic support, that is good
day, many authors of articles about them news. In the short term, they can do little to
work in Britain or America. Meanwhile, boost national gdp significantly. But being
European research gluts seem locally dri- more forthcoming with data and fostering
ven. Lots of studies on Slovenia, which has links with Western scholars should help. 7

90 Obituary Chuck Yeager The Economist December 12th 2020

Mechanic to hero rier might rip the aircraft apart. The least he expected was some-
thing like a bump in the road, to show he’d done it: strong proof for
General Charles (Chuck) Yeager, test pilot and the first to the friendly rivals back at base. Instead, at around 700mph
break the sound barrier, died on December 7th, aged 97 (1,126kph) he felt nothing particular, just a bit of resistance, like
poking his finger through Jell-O. He got the Collier trophy for it, a
If a flock of grouse flew across his path when he was out hunt- nice statuette on a plinth, and the family went to the White House
ing, Chuck Yeager knew what would happen. He would get his to collect it (his father, a staunch Republican, refused to shake Har-
slingshot, pick up some stones, and let fly. With his 20/10 vision in ry Truman’s hand). But it was quite a let-down.
both eyes, he could see to infinity; in five minutes two or three
grouse would be dead, hit square in the head. When challenged to He had to go much faster to get the effects he had been half-
target-shoot at a paper plate nailed to a tree, he could aim to hit the anticipating. That happened in December 1953, after a few flights
nail. He had practised those skills in the woods of West Virginia approaching Mach 2, twice the speed of sound. He was warned that
until they were second nature. if he went any faster his X-1A aircraft might “go divergent”. It did. At
74,700 feet (22,800 metres), and at 2.44 Mach speed, it began to roll
In the second world war, flying over France in P-51s, he once uncontrollably, then spin upside down. Completely disoriented,
more saw his prey from a long way off and stayed up-sun, so the battered by plus and minus g-loads, he remembered his helmet
Germans wouldn’t spot him. Then he shifted to be down-sun, be- cracking the inner canopy, and not a lot else. At last the plane got
hind them. Once he picked off five Me109s in a day, getting into a upright and, at 25,000 feet, he popped it out of the spin. He had
big old hairy dogfight, buzzing, diving, shooting, lots of high-gs, dropped 50,000 feet in 70 seconds. Back in radio contact, he
becoming an ace right there. He knew how his plane should be- gasped out: “Christ!…Boy, I’m not doing that any more.”
have, how all the hardware worked, how the ejector seat and para-
chute would save him: knew it as a mechanic, which was his train- It was odd enough that he was in the air anyway. As a boy, run-
ing. Armed with that knowledge, nothing much could surprise ning the hills or sitting with his grandfather learning to fish, he
him. He was in firm control of what was right around him, and never got near a plane, except to see one in the sky. He had no ambi-
what he couldn’t control, such as the enemy, or the outcome, or tions that way and, with only high school behind him, not enough
death, was not worth worrying about. He was too busy. education. He enlisted in the air force in 1941 as a mechanic, earth-
bound and easy, because he had already tinkered for years with en-
But when on October 14th 1947 he was dropped in the Bell X-1, a gines, water-pumps and his father’s cable tools for drilling for nat-
rocket-powered experimental plane, from the bomb bay of a B-29, ural gas. He took up flight training mostly because pilots had
he had no idea what lay ahead. Fun, probably, as he loved the X-1, beautiful girls on their arms, and hands that weren’t dirty. But he
and in his post-war test-pilot job he preferred tactical flying that became the most decorated pilot in America.
focused on one aircraft, rather than a dozen different planes every
week. It was more like combat, and the band of pilots he now be- In the same strange sort of reversal, he started out with no inter-
longed to, at Muroc air force base in California, were ex-warriors est in space and ended up training astronauts. In the 1950s, when
who felt the same way. “Glamorous Glennis” was painted on the space was mentioned, he would dismiss it as a place where he
bright orange fuselage in tribute to his wife—the wife with whom wouldn’t be flying, but sitting in a thing controlled by someone
he’d had a horseback race two nights before, busting a couple of else. No doubt the views were pretty, but he couldn’t have cared
ribs when his horse flipped him, which still hurt like hell. less. And anyway, he had no degree. His ideas changed as the gov-
ernment began to press the space programme and America, in his
The engineers back at base feared that breaching the sound bar- view, fell far behind the Soviets in developing space technology.
The usaf Aerospace Research Pilot School at Muroc, now Edwards
air force base, which he ran from 1962, offered a state-of-the-art
simulator that covered every stage of a space flight, from take-off
to landing. Applicants swarmed in, and a bare 1% made it, since
even fine grades on paper cut little ice with him. Astronauts, like
pilots, had to know the machinery they were riding in, how to fix it
and how to get back safely, not rely on some bunch of engineers.
Like him, they basically had to be mechanics.

Over the years he became well-known, but it was an intermit-
tent sort of fame. After the war he was celebrated as West Virginia’s
leading ace. After breaking Mach in 1947, hardly a month passed
without some magazine running an article about him. In the1960s,
when he was running the research-pilot school, he once did 163
talks in a year. He was a draw at any air show and at the Indy 500,
where several times he opened proceedings in the pace car, gun-
ning it with joy. Still, people didn’t match the name to the face, he
thought, until he did the acDelco car-parts commercial on tv; and
then when, in 1983, his Mach exploits appeared on cinema screens
in “The Right Stuff”, the film of Tom Wolfe’s book about the band of
pilots. He had helped on the book, going through crash reports,
which Wolfe kept getting wrong. As for the film, it was just enter-
tainment, pretty much fiction, from Sam Shepard’s dark hand-
some face to all those blue skies outside the windows.

So when he was asked, as he was annoyingly often, whether he
had the “right stuff”, as a test pilot and generally, he gave a down-
to-earth answer. Rather than being “the most righteous”, with “the
moxie, the reflexes, the experience, the coolness, to pull it back in
the last yawning moment”, as Wolfe wrote, he just knew all about
his planes, and had worked his tail off learning it. A mechanic’s an-
swer which, as ever, hit the nail on the head. 7

The ght for equality.

More for you to uncover.

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