Through a Glass Darkly

The news that Facebook is buying Oculus, the makers of the much-anticipated Rift virtual reality headset, has been interpreted by many as a forward play for the next iteration of the Internet, beyond mobile and the suddenly quotidian attractions of WhatsApp. This is pretty routine tech-hyperbole, but the claim does possess an internal logic, best articulated by the online game designer, Raph Koster, who distinguishes between an object-centric and a people-centric Internet. An "object" in this sense is not just an intelligent device ("the Internet of things") but also manipulable data (as in a software engineering object). The daddy in this space is Google, with its investment in augmented reality, Nest and Glass, not to mention search. "People-centric" sounds benign, but what it actually means is the ubiquitous mediation of social interactions. Facebook is the daddy here, and it clearly sees VR (virtual reality) as the logical progression of the social space from a 2D page to a 3D world.

VR has the attraction of allowing access to virtual people as much as virtual worlds. At the moment, a sleb's Twitter feed is often the work of a marketing intern. In the future, you will be able to interact with a near flawless bot of Paris Hilton (who will thereby stay forever young). The official announcements on the Oculus deal, and most of the media commentary, have avoided the obvious killer-app for VR technology, which is interactive porn. In time, the Rift headset will be augmented with haptic suits and genital prostheses (the full wank-rig, in other words). The solution to the commercial porn problem of recent years (how do you make money when there is so much free content available) is now obvious: you sell the hardware and software. The real losers will, as usual, be the models. Hentai (Japanese anime porn) is the future, just less cartoonish and more tactile.

Another way of thinking about this is that Google is increasingly in the business of augmentation, while Facebook is moving towards simulation. Koster is smart enough to recognise that this distinction is actually a carve-up; that underneath the applications, Google and Facebook have a common model: "It’s time to wake up to the fact that you’re just another avatar in someone else’s MMO. Worse. From where they stand, all-powerful Big Data analysts that they are, you look an awful lot like a bot. The real race isn’t over the client — the glasses, watches, phones, or goggles. It’s over the servers. It’s over the operating system. The one that understands countless layers of semantic tags upon every object on earth, the one that knows who to show you in Machu Picchu, the one that lets you turn whole visualizations of reality on and off".

Evgeny Morozov caught the flavour of this totalising ambition last year, and also correctly noted that the threat posed by surveillance is not to privacy but to democracy: "The widespread feeling of emancipation through information that many people still attribute to the 1990s was probably just a prolonged hallucination. Both capitalism and bureaucratic administration easily accommodated themselves to the new digital regime; both thrive on information flows, the more automated the better". Both business and the state seek pre-emption: identifying and intercepting a danger before it fully emerges, or identifying and satisfying a want before it fully forms. Both insist that they have our best interests at heart, both insist that it is what we want.

If this sounds gloomily dystopian, there is yet hope. This can be seen in the public reaction to Google Glass. The backlash against "Glassholes" is not just an example of the age-old tendency to give anyone who wants to be different a good kicking (a "hate crime", no less), any more than it is solely a product of socio-economic resentment in an increasingly divided San Francisco. It is clear that what creeps people out is simply the visible sign of intrusion and observation, even when the device is switched off. There may also be a subtext to do with gender and power relations: Glass turns geeks into people who gaze, in the sense defined by John Berger in Ways of Seeing. It is perhaps this whiff of proprietorial entitlement, rather than the corporate logo, that sees Glass bracketed with Google Buses.

There have been attempts to dismiss the backlash as a reactionary spasm in the face of an inevitable future that we will all come to embrace: "The future is on its way, and it is going to be on your face ... Wearables are where we’re going". Glass-wearers have even attributed simple gadget-envy: "Some of the irony is that the people hating on me for wearing Google Glass are probably going to have a pair in six months or a year". But this sounds like misplaced Messianic fervour (it reminds me of Clive Sinclair claiming we'd all be driving C5s). It also fails to address the reality that ubiquity does not make something acceptable. There is a reason why CCTV cameras are out of reach, and it's not just a preference for overhead shots.

The common ground between Glass and Rift, as emblems of their owners' view of the future, is wearable computing. The significance of this is not the technology per se, or even its use in a public space (we've had that since the transistor radio), but the integration with the body and the suggestion that it may not be wholly under the control of the wearer: that perhaps the wearer and others in the public space are subject to it. Naturally, boosters insist that the opposite is true - that wearables make the technology less visible ("out of our way") and more controllable. This worry over wearables is not paranoia about cyborgs, but the long-standing (and historically justified) fear that technology is a means of control. When archaeologists study man's first tools, they are also studying his first weapons.

To come somewhat more up to date, if you think about books as a technology, then the decision of Chris Grayling to limit access to them among prisoners makes perfect sense. The problem with books is that they are asymmetrical. Despite the best efforts of priests and business gurus, they are always subject to the reader, a point appreciated by thinkers from Martin Luther to Jacques Derrida. Books fail to give authority sufficient power over the reader, while potentially they give the reader some power, via knowledge, over authority. In contrast, the degree of control over the subject promised by wearables is enormous. Perhaps in future, instead of books, prisoners will be issued with glasses that flash up encouraging homilies, or deliver brief electric shocks to the recalcitrant.

The wider political context of wearable computing is the tension between privacy and transparency. To be effective, democracy needs both: the ability to determine without coercion (free assembly, the secret ballot) and the ability to interrogate and limit those who seek a mandate. The mediation of transparency has always been the expression of power, which is why the rich own newspapers and governments employ censors. Transparency should be proportionate to power, but the reality is the inverse: the powerless are the most exposed and inspected, while the powerful enjoy the greatest respect for their privacy. The idea that ubiquitous surveillance ("sousveillance") means we can better hold power to account is not only naive, it is positively dangerous because the technology of transparency will always bear more heavily on the powerless than the powerful.

As our ability to interact with the world (both objects and people) is increasingly mediated, transparency, which should contain power, instead serves to increase the cost of privacy, in terms of inconvenience and the loss of utility. Privacy then becomes even more obviously a species of property and thus the preserve of the wealthy. Sometimes, turkeys do vote for Christmas.

The Return of Patrimonial Capitalism

The big change announced in the budget - the abolition of the need to buy an annuity with the bulk of your pension pot - has produced a slew of mostly pessimistic predictions. These have ranged from structural fears, such as the meltdown of the annuity industry, to behavioural prophecies, such as the moral hazard of sexegenarians spunking their wad on Lamborghinis. The behavioural dimension is always overplayed because the budget is deemed to be a moment when policy directly and immediately impacts on "ordinary people" (hilariously parodied this week by Grant "Bingo" Shapps). In recent decades this has been amplified by the popularity of behavioural economics and the sinister/sugary trope of "nudging". In practice, few us are able to say what the impact of a budget will be, because there are simply too many variables in the mix.

In the immediate postwar period, there were fewer fiscal levers that a government could pull and even fewer that affected the large majority of the electorate (and that despite the persistence of rationing). The secular change since then has been the growing extent and complexity of taxes and benefits, which has given government more to play with, and the parallel shift in tax composition away from real wealth (which few have and which has few sources) to consumption (which affects us all and is multifarious). This has accentuated the myth of predictability, encouraging the "ready reckoners" in the media to break down the population into the sort of consumption-oriented granularity beloved of marketing folk, with their pseudo-anthropological tribes ("gay couple, smokers, vegan, single income, 1 child, 2 dogs" etc).

The real message of a budget announcement is therefore a matter of ideology, rather than the pound in your pocket. George Osborne is trying to tell us something, though perhaps more subtly than the Conservative Party Chairman. I think the substance of that message is to be found not just in the pension proposal but in the announcement that inheritance tax will be waived for members of the emergency services who die on duty. The numbers affected by this will be trivial, and the quantum of money, relative to the economy, even more so. The symbolic value is the yoking of something that is ethically ambiguous, inheritance, with something that is unquestionably admirable, self-sacrifice.

The link to pensions is that an annuity is the liquidation of capital. The longstanding criticism (long before 2008 ushered in lower rates) is that once a pension pot is converted to an annuity, there is then no inheritance. Of course this is actually a feature, not a bug, as the capital is ultimately what allows annuities to pay at a higher rate (currently about 6%) than other savings vehicles. It is the surrendered capital of those who die early that pays the income of those that die late. It may well be that allowing pension pots to be reinvested any old how will boost buy-to-let, and equally predictable that some retirees will make disastrous choices and lose their savings, but this obscures the fundamental change. Whether invested in property or equities or bonds, the reform will allow capital to remain concentrated and be handed down within families.

But those families are not the sort that drink copious amounts of beer and play bingo every week. The average pension pot in the UK is £30,000, though the annuities bought are typically smaller as many retirees take the 25% allowed as a tax-free cash lump sum. The "trivial commutation" threshold, which allows you to take the entire pot as cash rather than buy an annuity, has now been raised from £18,000 to £30,000. In other words, the "liberation" entailed in the decision to make annuities optional (and the related reduction in tax rates on pension withdrawals) is primarily of value to those with above-average size pension pots. This is a policy targeted at the better-off, rather than a policy targeted at the elderly in general.

The timing of this policy change in quite deliberate, but it has nothing to do with continuing austerity or demographic trends, let alone a fear of UKIP success in the European elections. It comes after three decades during which executive remuneration has maximised the tax-breaks of pension contributions. Those who will benefit most are retirees with very large pension pots who can now recycle more of their funds into property and equities. In this light, it is worth looking back at the last major change to the pension rules, in 2011. The introduction of limits on tax-breaks for executive contributions apparently "sparked a surge in directors requesting cash payments in lieu of retirement contributions, to invest outside their pension plan in property and other assets". You can almost see someone joining up the dots. Interestingly, the Chancellor did not suggest that in tandem with pension "freedom" he would reconsider tax breaks on contributions, even though the tax incentive has always been seen as a quid pro quo for the restrictions of annuitisation.

The "face" of this reform is not a middle-earner hoping to get a better return by investing in a student flat in Manchester, but Fred Goodwin. While the former CEO of RBS won't directly benefit from the change, having already retired and crystallised his winnings, the other members of the multi-million pound executive pension class will. Another perspective on this is that those most likely to face poverty in old age are already free to spunk their pension pots. The poorest third of all retirees were able to do this under the previous rules, though most didn't (a result of inertia/fear rather than rational choice). The government's sanguine attitude towards the risk of moral hazard (i.e. pensioners frittering their pots away on world cruises and then falling back on benefits) looks like the consequence of the introduction of the single-tier, flat-rate pension, which means they can be confident the burden on the state will not increase.

The boost to inherited wealth that this policy delivers might appear a marginal issue (and it has certainly been marginalised by the fretting over buy-to-let property prices, Lamborghinis and Bingo) but the recent publication of Thomas Piketty’s Capital in the 21st Century should banish any doubts about its significance. Piketty's empirical finding is that returns to capital (by which he means broad financial wealth) have consistently been greater than growth (which distributes returns across society), outside of the exceptional mid-twentieth century, and that a lower growth rate is conducive to higher concentrations of wealth, which would go some way to explain the ongoing reluctance to invest in productive capital (as opposed to property) and the attractions of austerity. We have, over the last 35 years of modest growth and widening income inequality, been heading once more towards the "patrimonial capitalism" of the nineteenth century. George Osborne is now telling us that it's full steam ahead.

Mitteleuropa Madness

The credits of Wes Anderson's new film, The Grand Budapest Hotel, inform us that it was inspired by the work of Stefan Zweig, the Jewish Austrian author who found fame with, among other works, The World of Yesterday and Beware of Pity. These two titles point to the film's strength, an entertaining pastiche nostalgia that has been carefully drained of sentimentality. The whimsy allows the film to introduce absurd and even callous elements: the hero Gustave's routine swearing and priapism (both odd in a concierge), decapitations and chopped off fingers, and the increasingly Nazi-style uniforms of the soldiers (echoing the similar sartorial evolution in Paul Verhoeven's Starship Troopers). The story opens in the Old Lutz cemetery, reminiscent of other sites of memory like the Jewish cemetery in Prague, and an oblique reference to the coming Holocaust (there's a brief snatch of cantor-style singing).

While the influence of Zweig is overt, the film is a portmanteau of tropes from the wider Mitteleuropa canon, so you can spot the work of many others. The tale is set in the imaginary land of Zubrowka (as in bison grass vodka), a cross between Zenda and the Austro-Hungarian empire, with its love of uniforms, rank and cakes (the state's logo is a near-match for the Nazi Siegrune - another queasy touch). The central location is the eponymous hotel, whose improbable height and 45-degree funicular recall the sanatorium in Thomans Mann's The Magic Mountain. It also directly recalls the Hotel Savoy of Joseph Roth, Zweig's friend and fellow Jewish Austrian author, a tale of estrangement and deracination in the years immediately following World War One, which was set in Lodz (i.e. Lutz).

The farcical plot revoles around the McGuffin of a valuable painting, Boy with Apple, which could be a sly nod to The work of Art in the Age of Mechanical Reproduction by Walter Benjamin (like Zweig, a suicide in flight from Nazism). The narrative thread is the character of Zero Moustafa, the (presumably Balkan) refugee who becomes a lobby boy and the eventual owner of the hotel, but the hero is Gustave, the hotel concierge, played by Ralph Fiennes as a cross between Charles Boyer and Robert Donat. Fiennes is the motor of the film, a surprisingly physical performance (he often moves the plot with nifty footwork, though more like Groucho Marx than Fred Astaire) combined with Shakespearean verbal dexterity. His cheerful profanity, liberal humanity, attention to detail and sheer energy make him a sort of anti-Hitler.

The young Zero, played by Tony Revolori, and his girlfriend/wife Agatha, played by Saoirse Ronan, are stock symbols of innocence and hope. His name implies the social worth of the immigrant, the fresh start of the refugee, and also perhaps the reset of civilisation that the First World War was widely felt to mark. Gustave is shot, off-stage, by the forces of order/barbarism. Zero inherits his newly-acquired wealth, but his happiness is cut short by Agatha's death from "the Prussian Gryp". This shows Anderson's lack of sentimentality, making a joke out of the calamity-upon-calamity of the Spanish Flu epidemic of 1918. Like the digging tools encased in Mendl's confectionery that Agatha smuggles to Gustave in jail, there is hard reality buried beneath the sweetness.

It was predictable that the anniversary of 1914 would lead to a renewed interest in all things fin de siecle and Mitteleuropean (Facing the Modern: The Portrait in Vienna 1900 at the National Gallery in London is a current example). Anderson's film is chock-full of wider cultural references, from the assassin Jopling, a comedy Nietzschean played by Willem Dafoe in layers of leather and stack-heeled boots, to the Sigmund Freud-alike Deputy Kovacs, played by Jeff Goldblum, who suffers symbolic death (his cat gets it) and castration (the severed fingers) before his actual death after being pursued through a museum. The meta-trope is ambiguity: the degree to which Austria-Hungary was itself a victim of World War One, and the degree to which the Dual Monarchy was a seed-bed of the anti-democratic and antisemitic forces that would lead to World War Two.

Though notionally set in the 30s, the film happily mixes up allusions from different decades and film history. The Egon Schiele painting that is switched for Boy with Apple is a pastiche in modern porn style; Zubrowka is a near neighbour of Duck Soup's Freedonia; the ridiculously complicated jail break is The Great Escape compressed into 5 minutes; Owen Wilson's cameo as Monsieur Chuck looks like a nod to Hemingway (and perhaps an in-joke re Woody Allen's Midnight in Paris). Murray F. Abraham, as the mature Zero telling the tale of Gustave, echoes his role as Salieri telling the tale of Mozart in Milos Forman's Amadeus.

The theatrical plot and mannered style of the film allow Anderson to give full rein to his directorial OCD: symmetry, repetition and serial order feature heavily. The cutting from close-up to near-microscopic distance in the snowy chase sequence is an example of his habit of transitioning from models (or reality made to look like a model) to reality (composed as if in a diorama). The colours are rich and extensive, the vibrant purples, reds and ochres of the hotel contrasting with the dull greys and blacks of officialdom. The pink of Mendl's cake-boxes echoes the pink of the hotel's exterior: the move between small and large again.

The secret fraternity of concierges (the Society of Crossed Keys), that Gustave calls on for help, is Anderson's world in microcosm: a rigid formula incorporating huge variety. That could, of course, stand for the Austro-Hungarian empire itself, which perhaps explains Anderson's sympathy for Zweig and his ilk. The critic James Wood, in discussing Joseph Roth, talked of the empire as a form of rhetoric: it needed to be constantly performed ("the comfort of repetition") to have any reality. The Grand Budapest Hotel catches that sense of performativity, while evoking the buttery richness of its physical world (cakes are eaten but the characters are mostly greyhound slim, like figures in a Schiele painting).

It might appear odd that an American film-maker should have such a passion for Mitteleuropa, but this actually completes a circle of sorts. Joseph Roth experienced the traumatic transition into modernity that is the source of nostalgia, moving from poverty in the semi-feudal Galicia of the Austro-Hungarian Empire via Vienna and Berlin to end his days an alcoholic in Paris in 1939. In contrast, the wealthy Zweig made the shorter journey from bourgeois Vienna to London (like Freud) and from there to New York and finally Brazil where he died in 1942. Roth didn't make it to America, except in his fictional Job (subtitled A Simple Man and perhaps an inspiration for the Coen Brothers A Serious Man, which starts in a shtetl somewhere in the vicinity of Galicia), despite invitations. He appears to have considered the USA a modernist step too far, particularly Hollywood, which was busy commodifying a pastiche of Mitteleuropa during the 30s in the form of light opera and horror stories.

Anderson's apparent preference for Zweig over Roth is ultimately a matter of moral seriousness. As Roth said to Zweig: "You are lucky enough … not to be able to see certain depths of darkness, yes, you avert your eye ... You may be smart, but your humanity blinds you to others' wickedness. You live on goodness and faith. Whereas I have been known to make startlingly accurate observations about evil". What is interesting about The Grand Budapest Hotel is how much of Roth, that appreciation of underlying evil, bubbles up through the candyfloss of Zweig, despite Anderson's evident pleasure in the superficial. It is this hard edge that makes the film more than just Carry On Der Rosenkavalier.

I'm Definitely Not All Right, Jack

The fulsome eulogies to Bob Crow and Tony Benn should remind us of two things: that politics in Britain is dominated by personalities, and that its participants consider it a game in which both sides can shake hands and indulge in mutual admiration at the final whistle. These are two sides of the same coin: the engineered narrowing of the spectrum of the "possible" and the consequent need to amplify differences in style and tone to fill the void. Many blame the media for this "trivialisation", but this is ahistorical (consider the exploitation of image by Gladstone and Disraeli) and a distraction from the managerialist turn during the neoliberal era (do you have an idea where Bob Ford of Toronto stands on the political spectrum, any more than you do José Manuel Barroso?)

Benn famously insisted that politics should be about policies, or "issues", rather than personalities, but gave the lie to this by repeatedly putting his own ego (loosely camouflaged as "principles") ahead of pragmatism. He was a Cavalier, not a Roundhead, let alone a Leveller. His only substantive achievement was to allow hereditary peers to "step down" and become MPs. Concorde would still have happened without him, as would the constitutional turmoil within Labour. The exhaustion of social democracy, the structural decline of Labourism, and the advance of the fissiparous New Left were the products of wider economic and social forces. His diaries will remain a fascinating resource for historians and wannabe politicians, but they are also a monument to narcissism. Richard Crossman's diaries will probably stand the test of time better - even if they are no more reliable, their entertaining style suggests a greater shrewdness.

Though he held his views sincerely, during the 60s as much as the 80s, Benn's essentially antique worldview was that of the Liberal Edwardian upper class that moulded his family: a romantic view of sovereignty and Parliament, a commitment to public service (he would have made a fine viceroy), and a schoolboy crush on the salt of the earth workers, both ancient and modern. There wasn't a cynical bone in his body, which was perhaps his major flaw. He needed to be less Ian Carmichael and more Terry Thomas. As he got older, and left the drama-queenery behind, he came more and more to resemble an eccentric vicar (I can't help but recall the lefty rev in John Mortimer's Paradise Postponed). There was much truth in Harold Wilson's crack that he immatured with age, proceeding from the whizz-bangery of his youth, via a sentimental evocation of the history of the Labour movement, all the way back to a nostalgia for the seventeenth century. He was in many ways an iconic New Elizabethan: collectivism, cosy comforts and jet engines.

Unlike Benn, Bob Crow had few illusions about Parliament and the Labour Party. The Tory reaction to his death (reflecting the consensus view of the political class) seems to have surprised some people, despite the obvious condescension in praising a man who "stayed true to his roots", "fought his corner", "loved Millwall" etc. The real reason for the warmth is simple nostalgia for the certainties of the 70s. For all Crow's actual pragmatism and moderation (an adept negotiator and moderniser behind closed doors), he was willing to play up to the public role of a latterday Fred Kite. The reason Boris Johnson always refused to meet him is simply that Johnson is incompetent and Crow would have run rings round him. Unlike the mayor, the RMT leader had substance behind the media persona.

The key point about Bob Crow was that he was atypical of the union movement as a whole - not because of any personal genius or style, but simply because the RMT found itself in the fortunate position that London became ever more dependent on a functioning Tube system as the population ballooned over the last 25 years. The wider reality of "union power" over the period is that it has been noticeable more by its absence than its exercise, and by its defeats than its victories. Grangemouth last October was more typical than the day of action on the Tube in February. The RMT is a godsend to the Tories because it preserves the image of a militant union exerting leverage, even though the actual level of disruption through industrial action is slight. If it hadn't existed, they would probably have invented it, like so much British "heritage".

Since the mid-70s, the dominant narrative has been that economic stagnation was the result of over-mighty labour (with a sub-trope of malign "barons" misleading the rank and file) and that inflation was the product of escalating wage demands and poor productivity. In fact, the decline in profitability (which "stagnation" was the euphemism for) was the paradoxical product of increased productivity (which led to tighter margins due to over-capacity) and technology-enabled globalisation (which gave a leg-up to lower-cost manufacturers in the developing world). Double-digit inflation, the other half of the "stagflation" double-bind, was a product of the oil shocks of 1973 and 1979, with the former having the more dramatic effect because of the economy's greater initial vulnerability (it took till 1977 to get this under control, not because of union militancy but because of the time taken to lessen dependency, plus by 1979 we had the offsetting advantage of North Sea oil tax revenues).

You don't have to believe this interpretation, but consider: after the miners' strike knocked the stuffing out of the union movement, and the Lawson boom saw the return of "confidence", you would have expected the new conditions demanded by capital (primarily low taxes and low wage growth), to have led to strong GDP growth, particularly as aggregate demand was maintained through growing household debt. In fact, growth has been slower since the 80s than it was in the 1945-73 period, and we've had the added bonus of market turbulence due to financial deregulation and asset bubbles. The salient point is that growth has been weaker than the narrative ("disempower unions and we will flourish") promised. It is possible to explain this as the product of globalisation (i.e. a relative decline of the West that would have been worse but for the countervailing impact of heroic free market dynamism), but this only reinforces the conclusion that stagnation is not (and never was) the product of union militancy.

The narrative changed focus in the Major years: poor growth and stagnant wages were the result of labour market inflexibility and inadequate skills (i.e. the fault lies in us, not in our capitalist stars). This became the mantra of New Labour as much as the Tories. Again, this has been proven wrong: trend growth has remained weak and a lot of it has been fictitious (e.g. property speculation), despite the UK labour market being one of the most flexible in the developed world and our educational performance being no worse than average (contrary to the relentless anti-state school propaganda - and that's without questioning the assumed causal link: Japan has been getting top marks throughout 20 years of economic stagnation).

Though the hard of thinking may see the passing of Bob Crow and Tony Benn as the "death of socialism", it may actually mark the point at which the narrative starts to unravel (the threads were obviously loosened in 2008). Admitting that the modern bogeyman was actually a pragmatic and effective executive, and that the bogeyman of the 80s was a fine old patriot, may just prompt people to ask whether we have been distracted by paper tigers all along.

A Tale of Two Cities

Evan Davis's Mind the Gap: London vs the Rest was an attempt, across two programmes, to explain why London is so super brilliant and the North is a bit wank. As a balanced BBC essay, this was interesting more for what it omitted than for what it included, unless you just can't get enough of media-botherers like Boris Johnson and Ian McMillan. The first programme, last week, attributed London's current dominance to agglomeration, though this concept was reduced to the banality of "clever people like being around other clever people", while the impact of globalisation and the changes to capital flows since the 1970s were simplified to a fashion for "hubs".

To illustrate this, we had clichéd scenes of Silicon Roundabout (hipster bikes and carefully curated beards, natch), though the cat was let out of the bag when the exemplar business, whose "representative employee" commutes from Stockport, turned out to be a marketing outfit. This is less agglomeration in action than evidence that the growth of the London economy has been driven by business services, such as marketing, recruitment, law, business consultancy etc. While the historic shift from manufacturing to services (and the structural bias towards the South that this entails) was acknowledged, the more subtle compositional change in the economy, from productive to distributive services, was ignored in favour of the usual anodynes about innovation and dynamism.

Davis probably thought the mayfly controversy triggered by the second programme would be the broad hint that the HS2 cash might be better spent on trans-pennine links, to create a new second city "hub" combining Manchester and Leeds, but it looks like the day's rage is focused more on his suggestion that Salford should rebrand itself as West Manchester, which has at least eclipsed Jim O'Neill's recent attention-grabber of "Manpool". The focus on Salford was explained by the BBC's own heavy investment in Media City. Salford Quays remains a pretty desolate place, despite the extensive boosting, so the programme combined shots of small numbers of office workers in front of glass buildings with greater depth shots of football crowds on the way to a match to give the impression of numbers and vibrancy. Unfortunately, the latter showed City fans on the other side of Manchester.

What was missing from either programme was any mention of London's role as a tax haven, both in respect of domestic pro-capital policies and as a gateway to offshore jurisdictions. Though globalisation and financialisation have drawn international and domestic capital into the City, the wider metropolis has also benefited from the political decisions taken to make it congenial for foreign and domestic elites. The massive sums invested in property, with which the right-wing media have a love/hate relationship, are just the tip of the iceberg. As Boris Johnson put it, London is becoming the capital of the world (his childhood ambition, according to his sister, was to be king of the world). Of course "the world" here specifically refers to a cosmopolitan elite who can afford to eat in the Shard's restaurants, not economic migrants trying to paddle across the Mediterranean.

The ideological underpinning of the series was the impossibility of central planning. The first programme noted that the grand schemes to rebuild London after World War Two, notably the Abercrombie plans of 1943/44, came to nothing because everyone just got on with it and rebuilt higgledy-piggledy. In fact, the plan was scaled-back due to its enormous cost at a time when the UK was desperate to pay down US war loans, retool industry and build new houses. Despite this, the key recommendations, including an expanded green belt and new towns such as Stevenage and Harlow, eventually went ahead. The plans that never got off the drawing board, such as inner-city orbital motorways (the Westway is a fragmentary exception from a 1960s revival) and rigorous zoning, were seen as overly American in approach (a bit too much like Robert Moses's imprint on New York) and thus not suitable for London.

The second programme's critique of central planning (an amusing tale of a thwarted attempt to move the Bird's Custard factory from Birmingham to Liverpool, which succeeded in bumping it further South to Banbury) was pure Hayek: government cannot second-guess the market, there are unintended consequences etc. But this ignored continuing state intervention from Thatcher onwards in respect of deregulation, tax privileges and the symbiotic relationship of business and government. The proactive development of the Tube was skipped in favour of concerns that Crossrail is playing catch-up, the implication being that infrastructure projects follow demand, rather than creating it, despite the evidence of the Metropolitan line and "Metroland".

A significant omission in the story of the decline of Northern cities relative to London was privatisation. It has become conventional wisdom that Labour offset the free market growth of the capital in the first decade of this century by funding lots of public sector jobs in the North: "Under Gordon Brown, great swathes of the public sector were relocated to the regions, and the benefits system was bolstered to help engineer more equitable spending power. Predictably, these policies have only succeeded in embedding a culture of dependency while simultaneously pricing the private sector out of the market for enterprise and jobs".

In fact, the growth of public sector employment between 1999 and 2009 was spread proportionately across the country because it was largely geared to popular areas such as health and education - i.e. where hospitals and schools (and thus the population) are. The increasing share of public sector employment in the regions also reflected the relative decline or slower growth of other sectors, not just an absolute growth in state-funded jobs. With the privatisation of public services, many lower-wage jobs have stayed in the regions, essentially because they are point-of-delivery roles that cannot be moved elsewhere, but a lot of high-wage roles have moved to corporate HQs in London or backoffice centres in the South East (of the four largest outsource providers of public services, Atos and Capita are headquartered in London, while G4S is based in Crawley and Serco in Hook). This has exacerbated the wider shift to a low-wage economy in the regions.

Between 1951 and 1981, Greater London's population shrank from 8.2m to 6.6m, due to a combination of the central planning of new towns and the free market development of the commuter belt, both heavily dependent on the (centrally planned) investment in regional transport. It was the policy decisions of the 80s (including tighter planning laws and attendant "nimbyism" in the Home Counties) that reversed this trend and led to the rapid growth of Greater London over the last 30 years (back up to 8.2m by 2011), of which spiralling house prices were the most obvious symptom. This was not some sudden efflorescence of innovation or Cockney genius. Apart from acknowledging the importance of big infrastructure, Davis was remarkably coy about the role of central government.

One thing he did chose to mention was Zipf's Law and the observation that city sizes within a country tend to follow a standard distribution. In fact, Zipf's Law relates to word frequency in language, but the principle of a power law distribution has been found to apply in other areas. That it isn't strictly applicable to city size - the UK being one exception - shows that this is an imposed paradigm in this context, rather than an immutable "law", serving the ideological purpose of defining what "ought" to be. The point of Davis's observation is not that London is too big (it isn't, relative to the size of the country), but that the second tier UK cities are under-sized because there are simply too many of them competing for the same "human capital".

The reason why Northern cities are where they are is largely down to power and raw materials (coal, water, iron ore), which encouraged spatial distribution rather than consolidation. Most factories in the nineteenth century were small-scale - the Black Country and the Potteries were typical. The large Pennine mills were the exceptional result of limited access to water power, which necessitated local concentration but also limited growth in any one location, thus the mill towns spread along the upper reaches of the rivers, much as shipyards spread along the lower banks. The massive "works" of the early 20th century, such as car plants, were the product of electricity, which allowed industry to be consolidated on existing urban peripheries and arterial roads. The argument of Davis and others is that we now need to consolidate further into a few large "hubs", given the near-ubiquity of datacoms and the free-floating mobility of the "knowledge economy".

The ironic agenda behind this is a desire to "pick a winner", the quintessence of old-school central planning. In practice, it means lobbying for further planning deregulation (i.e. let the private sector dictate growth) and an end to "jam-spreading" (i.e. put more of our state investment eggs in one basket, to fuel a localised boom). This is a continuation of the neoliberal theme that we should write-off certain parts of the North and encourage labour mobility: "The balance of spending should be strongly tilted towards ensuring better education and training for local people and away from shiny buildings and expensive new transport infrastructure that will do little, if anything, to turn these places around". The chosen winner for Davis and others is Manchester, hence the photo-op visit to the penthouse of a new "executive class" tower block in the centre of that city to chew the fat with a property developer.

One thing the programmes incidentally highlighted was the evolution of two distinct city-scapes since the 80s. Where once we had the dichotomy of office and factory (clean and dirty, polite and sweary, middle-class and working-class etc), now we have a dichotomy based on two middle-class visions: the corporate space that looks more like a hotel (Canary Wharf and Salford Quays both have an air of the dormitory about them) and the hipster "creative hub" that marries a fantasy village vibe and high-tech. Both revel in their inauthenticity, aspiring to be somewhere else at all times: usually a mythical Manhattan and a mythical Haight-Ashbury.

The reality is that London is two cities, Westminster and the City. Its dominance is a product of the combination of government power (which attracts corporate power in search of privileges and leverage) and financial opportunism (which attracts capital). The former is equally responsible for London's exceptionalism, though it's the latter that usually gets the credit (Boris Johnson's campaign for lower corporate and personal taxes is as central to his brief as his defence of bankers as "wealth-creators"). Government is never going to leave London, and nor is the City. Blaming the cities of the North for being in the wrong place, for being too many and various, is just a cruel distraction. Decanting the population of Liverpool into Greater Manchester isn't going to change the balance of power.

Memories of Underdevelopment

One of the ever-present tropes of Russian history is the idea of "accelerated development". This is premised on the belief that the country is inherently backward, but that it may make the leap to modernity through an act of will: the deregulation and privatisation of the Yeltsin years were quite in keeping with the spirit of Lenin. The grandaddy of this idea is Peter the Great, who built St Petersburg (on the bones of conscripted serfs and Swedish POWs) as a "window to the West", thereby initiating the binary metaphor of Russian state history and elite culture: open/closed, in/out, new/old etc. The new city's Baroque palaces and arrow-straight prospects were a radical contrast to the winding Medieval lanes and onion domes of Moscow. The bi-directional "window" motif also captured the conflicting desire to be accepted by the West while fearing its intrusive gaze.

Russia's history after Peter is often presented as a series of steps forward and backward, tentative liberalisation alternating with brutal repression: serfs liberated, everyone sent to Siberia. Underlying this is a liberal fatalism about the possibility of reform that dates back to the early nineteenth century and reflects an elite pessimism about the maturity of the people. This in turn creates a space for that mix of the fantastic and the hard-headed that is quintessentially Russian. Khazov, a Populist (Narodniki) of the 1860/70s, quoted by Marshall Berman in All That is Solid Melts into Air, observed: "Russia is led along the road to political freedom not by the liberals but by dreamers who organise ridiculous and childish demonstrations; by men who dare to break the law, who are beaten, sentenced and reviled". This has an obvious modern echo in Pussy Riot and Ukraine's Femen, particularly when they are on the receiving end of Cossack knouts (the fact that women have been at the forefront of radical protest is significant in itself).

Rather than the serene or jerky progress experienced elsewhere, Russia is assumed to have had trouble maintaining any forward momentum, hence the continuing need for acceleration. The twentieth century was dominated by this paradigm, notably in the emblematic development schemes of the early Soviet Union, such as collectivisation and electrification, which promised to leap-frog the country from feudal under-development to post-capitalist industrialisation. Yevgeny Zamyatin's We, the daddy of modern dystopias and inspiration for Orwell's 1984, was subversive not because it criticised the "Benefactor" (i.e. Stalin), as subsequently assumed (it was actually written before Lenin's death), but because it questioned the need for accelerated development. The post-hoc Cold War triumphalism of many in the West - that the USSR couldn't keep up the pace of military spending and thus crippled its economy - is a variant on this: Russia has great power delusions but lacks capacity beyond "inexhaustible" supplies of manpower and raw materials.

The reality is obviously more complex, but this trope remains popular among both domestic and foreign analysts. Autarkic development provides a progressive vocabulary for Russian conservatives, not to mention opportunities for oligarchic looting, while the attendant risks to foreign capital, together with the oligarch's fondness for imported luxuries that Russia is incapable of supplying (e.g. an English education), allow foreign conservatives to raise their eyes to heaven and mutter exasperatedly about "muzhiks" (all oligarchs are assumed to be peasants at heart). The Through the Keyhole special on Viktor Yanukovych's crib was a perfect example of this, with outrage over his profligacy competing with contempt for his gangsta taste. The point was not that he was a corrupt politician, and therefore no different to many in the West, but that he saw himself as a Russian oligarch. That vulgarity, we were invited to conclude, was his real crime in the eyes of the Ukrainian people.

The pre-games coverage of Sochi by Western media focused heavily on inadequate facilities and corruption. This was not inaccurate (far from it), but it reinforced the idea that Russia remains irredeemably backward. Similarly, Putin's anti-gay legislation is seen as indicative of a society-wide intolerance, even as a rejection of European values, rather than as a top-down "culture war" initiative intended to distract from economic concerns and drown out political criticism (like Section 28 in the UK in the 80s and the current abortion rollback in Spain). The corollary of this assumed backwardness is the fear of irresponsible action, under-development being seen as a form of immaturity and a lack of sophistication. The suggestion that the "Russian bear" may lash out at any moment is always hovering in the background.

Since the 1991 failed coup attempt and the eclipse of Gorbachev, the popular Western image of Russia's leaders has shifted from the negative pragmatists of Cold War legend (Andropov was even characterised as a "Karla" initially) to unreliable chancers driven by their weaknesses: the drunken "holy fool" Yeltsin and the vain, bullying Putin (his assessment of Yanukovich as both "legitimate" and having "no political future" was pragmatic, but widely interpreted as evidence of arrogant puppet-mastery). Much of the Western media finds itself lurching from one pole to another in its coverage of the Ukraine crisis (sometimes in the same article): from assuming that Putin is playing a cautious game (pushing inch by inch until he meets resistance) to assuming he is hell-bent on re-establishing the old Soviet borders.

The development trope has surfaced in two forms during the crisis: a blithe assumption that the West of Ukraine is more "advanced" than the East, hence it's affinity with the EU (in reality, the West is more rural, the East more industrialised); and a suggestion that Putin's leverage ultimately comes down to large reserves of natural gas, on which the German economy is dependent (those naff Gazprom ads during Champions League broadcasts now take on a sinister hue - perhaps Bayern Munich will be spooked into a collapse against Arsenal). The "vulnerability" of London to an oligarchs' strike is a minor and slightly comic variation on the latter theme, though one that paradoxically hints at our under-development (a dependency on foreign capital) as much as Russia's.

The Ukrainian crisis looks like it will resolve in one of two ways: either a partition of the country, with the Western rump accelerated into the EU and NATO (Alex Salmond will have words to say on that); or a loosely confederated buffer-state in which exclusion from the EU and NATO is the price paid for territorial integrity. Putin has calculated that Russia will gain whatever the outcome, so long as hostilities are avoided (and nobody fancies war in this of all years). The US and most of the EU do not care much either way and see this as "afters" from the dissolution of the USSR (they are not keen on another agriculture-heavy Eastern march with crypto-fascists and oligarchs in or near government). Even the Crimean Tatars will be reconciled - they have the attraction for the Russians of not being Ukrainian, and of liking horses.

Still in Range

Three quarters of the way through the league season, Arsenal are 4 points off the top. Inevitably, the commentary is largely about failure. This is partly a consequence of leading the league for long stretches, and partly the dominant narrative of recent years, which assumes that the Gunners will blow up at some point. The latter clearly informs the former, with sage pundits predicting the inevitability of collapse since September (the same pundits who reckon Liverpool can make a late dash). There has even been a reappearance of the pseudo-scientific explanation for our table-topping: "Their points tally has exceeded their general play". This just means we have been more efficient at converting chances into goals and goals into points. Our recent dip in form is taken as evidence of regression to the mean, though it actually points to a bout of inefficiency (the "unnecessary" goals against Sunderland are part of this as well).

The last three weeks have been a mixed-bag, but perhaps not the disaster assumed by some, critics and fans alike. The away thumping at Liverpool was traumatic, but it owed as much to Liverpool's good form and fortune on the day as our poor start. Ironically, a determination to get back into the game quickly, rather than settle for a 0-2 deficit at half-time, saw us take too many chances against a side built to counter-attack. The worst performance of the month was the home draw against a very poor and unadventurous Manure. This was easily the worst game seen at the Emirates all season, and probably tainted by the Anfield experience.

The first-leg against Bayern Munich was shaping up to be a great game but the die was arguably cast in Naples when Arteta, who would otherwise have been our likely penalty-taker, picked up a suspension. After Özil's miss, and the disruption of Gibbs's injury, there was little surprise when Robben milked Szczesny's challenge to put the game beyond us. The second goal, which has probably put the tie beyond us, was again down to an understandable but naive desire to equalise. We don't lack craft or courage, but we need a little more cunning.

The cup victory over Liverpool, and the comprehensive display against Sunderland, were better indications of our ability, though the defeat at Stoke pointed to inconsistency, as Wenger rightly acknowledged. While our record at the Britannia Stadium is poor, and the result owed something to bad luck, it was an uncharacteristically flat performance after a week-long break. The remainder of the season comes down to being able to play consistently at or near to our current potential, which means 20 from a possible 30 points and a final total of 79. Most pundits are predicting doom on the basis of Spurs and Chelsea away and City at home, but victories in the other 7 games would still produce 21 points. If we beat both Chelsea and City, then the title is wide open.

If we do fall short this season (and by that I mean failing to get first or second, not dropping to fifth), then a lot will come down to the effect of injuries. This can be over-stated (the press obviously dwell on the subject as it provides substance for non-match speculation, like transfers and training-pitch bust-ups), but I think there has been a drop in effectiveness (or "efficiency" in Wenger-speak) due to the absence of Aaron Ramsey and the mixed form of Jack Wilshere. When fit and on-song, both offer the ability to break through the opposition's lines and create space for goal attempts. The loss of Theo Walcott has also been felt, but I think it is drive in the centre of the pitch that matters most. Some have criticised Wenger recently for not playing Oxlade-Chamberlain wide right in more games, but it is clear the manager is trying to develop him in a more central role, essentially as a successor to Rosicky. Having options wide is superfluous if you can't create space in and around the penalty area.

Arsenal still look a work in progress. The back five are a lot more settled and Sagna's eventual departure (if not this summer then in 2015) manageable. Vermaelen looks likely to leave and I suspect we'll buy a proven replacement, rather than promote a rookie centre-back. The recently-announced contract extensions for Mertesacker, Rosicky and Ramsey all look shrewd, while the acquisition of Özil is already paying off. Despite the eagerness of some to insinuate that he is over-rated, or just not capable of handling the English game, he already leads the assists table at the club and has scored as many goals as Cazorla. Assuming he improves as he adapts, he could be outstanding next season. If Ramsey can pick up where he left off, Wilshere get his mojo back (once he stops worrying about Brazil), and Walcott return even more matured, then we could have the best attacking midfield by some distance. I suspect a new striker will turn up as well.

There is much to admire in this squad, and every reason to believe that they will get better. The question now is whether they can make a burst for the finishing line this season. A decisive victory in Munich is unlikely, but an FA Cup final and a close finish in the league are both well within range.

Britain's Sonderweg

Some reviewers of Niall Ferguson's The Pity of War on BBC2 last night were surprised that his claims were comprehensively dismissed by the panel of invited historians, as if he'd miscalculated and shot himself in the foot. This is like criticising a showy lion tamer for provoking roars (the studio layout was pure circus). The 90 minute discussion cum slideshow, rehashing his counterfactual (i.e. speculative bollocks) 1998 book of the same title, was largely an advert for his public-speaking business, though it did also have a role to play in the BBC's World War One coverage by ticking off "heterodox" and "provocative" on the checklist.

The Beeb has so far presented three right-wing views of the war. Jeremy Paxman might appear more centrist and "balanced", but his core position in Britain's Great War was conventional Tory: the Germans were the bad guys, Britain was right, the rest of Europe was marginal (the Corporation may struggle to sell the series beyond the Anglosphere). Max Hastings is not merely conventional but echt establishment: the blame lies with a half-mad Kaiser and Prussian militarism, and  subsequent doubts were the work of nancy poets and communist fellow-travellers. Ferguson's isolationist argument is presented as oppositional and daring, but crucially without explicating his views about empire or America - i.e. that Britain's interests lay outside Europe. This is a debate between species of conservative.

The fundamental difference between Hastings and Ferguson is the former's acceptance of the Sonderweg ("special path") theory of German history, which sees both world wars as the culmination of something "abnormal" in the development of the German state, stemming from the time of Bismarck if not Martin Luther. The view originally had positive connotations, suggesting a "third way" between the decadent democracy of France and the backward absolutism of Russia in the late nineteenth century. The corruption of this idea under Nazism led post-WW2 historians, particularly on the left, to repurpose the Sonderweg as a critique of German society and culture, and a contextual explanation of the Final Solution. This approach has fallen out of favour since 1989 (the "uniquely evil" claim was the antinomy of the conservative equation of Nazism with Soviet totalitarianism), but popular histories in Britain still seek to keep it alive, if only because it reflects greater glory on Our Finest Hour.

Ferguson focuses more on the Sonderweg of Britain (and later the USA), as the cradle of modern finance capitalism and the intellectual powerhouse of classical (and neo) liberalism. The wider cultural resonance concerns the question: is Britain part of Europe? Given that the locus of this contemporary debate has been manoeuvred onto the right, as a conflict between different varieties of capitalism, there should be little surprise at the absence of any "left" analysis of the war on the BBC beyond safe cultural studies about Tommy Atkins, the contribution of women or (I kid you not) horses. The nearest to a dissenting voice has been the repeats of the ten year old series based on the work of Hew Strachan, which provided a more nuanced explanation of the mix of calculation and stupidity that led to war and the global aspects normally ignored in the British focus on Flanders (in part the product of modern embarrassment at the imperial concerns that compelled Britain's involvement and her stance at Versailles).

Ferguson made a point of praising AJP Taylor as his hero, which might appear odd given the distance between them on the political spectrum, not to mention the old troublemaker's fondness for the Sonderweg theory (he traced the roots of German aggression all the way back to Charlemagne), but they share a common Little Englander tendency and a willingness to use history for ideological purposes. Taylor's "railway thesis" - that WW1 was the result of an arms race and a system of military deterrence (i.e. mobilisation timetables) - had a contemporary parallel with concerns over nuclear deterrence and missile deployments in the 1960s (Taylor was an executive member of CND). Where they differ is in their view of the US, which Taylor saw as a greater destabiliser of Europe than the USSR, and a hegemon that would happily betray Britain in furtherance of its own interests. For Ferguson, the US is the "manifest destiny" of Anglo culture. You suspect he would sooner vote for a union of the UK and US (plus Canada, Australia and New Zealand), than a union with Europe.

Hastings' The Necessary War framed the debate as a dichotomy between an "informed" view of the pragmatic necessity of conflict and a "sentimental" misrepresentation that runs from the war poets to Blackadder. There were lots of calm chats in book-lined studies where the official line was presented as unarguable. One shot even had a Union Jack fluttering beyond the window. It was the metaphorical (and possibly literal) Whitehall view. Hastings noted that the caricature of the British high command, safely behind the lines sipping champagne while moving flags on a map, ignored the prosaic reality that modern war and field communications required a rear position. He didn't seem to appreciate that popular revulsion was less about the drink and assumed cowardice and more about the treatment of soldiers as mere chess pieces.

The word that repeatedly crops up in the popular discussion of the war is "waste". This is a concern not just with the conduct of the war, i.e. the competence of the generals and politicians, but the objective purpose of the conflict (a sarcastic soldiers' song was "We're here because we're here because we're here ..."). What did Britain gain, or prevent the loss of? Some of the contemporary frustration with the Versailles Treaty was that it was incapable of providing a clear answer to this question. In contrast, WW2 was seen as more objectively worthwhile, even before popular recognition of the Holocaust and the catharsis of the Nuremberg trials. Try as they might, proponents of the "necessary war" thesis are unable to convincingly paint a Wilhelmine Europe as Nazis in pickelhaubes.

The argument, both in 1914 and now, is an extension of the hegemonic paradigm of great power relations that arose in the nineteenth century. This saw diplomacy as the highest form of politics (the refuge of the aristocracy in the face of creeping democracy), and international relations as a game of chess: the "great game" of Rudyard Kipling's Kim. This idea continued into the twentieth century and was given a second-wind after WW2 with "game theory", MAD and an obsession with dominoes. It leads to a focus on pre-emptive action to counter the future intentions of the enemy, hence the centrality of alliances and mobilisation plans in 1914, and the insane risks flirted with over the Cuban crisis in 1962. It's proponents are particularly vulnerable to counterfactual delusion (if we don't do X, they will do Y), hence the popularity of Ferguson among neocons. Hastings, as befits an establishment figure, is less indulgent of counterfactual flights of fancy, but he is equally obsessed with moving chess pieces in contemporary geopolitics.

One thing shared by Hastings and Ferguson is a thinly-veiled homophobia. The former referred to JM Keynes as a "German sympathiser", hinting at the persistent canard that his opposition to the Versailles Treaty stemmed from a homosexual attraction to Carl Melchior, one of the German negotiators. This is a favourite theory of Ferguson, who has more recently claimed that the economist's supposed disregard for large government deficits ("a burden on our children") can be explained by his lack of offspring. William Rees-Mogg, a former editor of The Times, even claimed that Keynes's antipathy to the gold standard was a product of his immorality (aka, "buggers reject bling").

There is a place for revisionism and challenging shibboleths, but too much of the current "patriotic" case for WW1 centres on denigration of the opposition. Michael Gove's "Blackadder" sneer is from the same stable as the snidery about Keynes. This is, of course, a tactical consequence of the belief that the herd are incapable of sharing the sophisticated understanding of the chaps in Whitehall. The rabble must be roused by appeals to patriotism and revulsion at real or imagined atrocities (the parallel with the current Daily Mail smear against Harman et al is instructive). However, it also suggests a lack of confidence in your own case, or at least your ability to make it.

The BBC's approach to the WW1 centenary has been timid. This is understandable at one level - the need for "balance" and "respect" would always militate against too much heterodoxy - but it has been disappointing to see (as yet) little attempt to integrate WW1 into wider European or World history, while the ramifications for Britain's attitude towards the EU (our own Sonderweg debate) have been largely ignored - Ferguson's counterfactual what-ifs can provide no lessons for current dilemmas, just empty propaganda. Perhaps the Beeb's caution is explained by the fact that the centenary of a war supposedly fought to defend the rights of small nations occurs in the year of a referendum on Scottish independence. World War One remains, in many ways, too sensitive a subject.