What is holding us back? - RSA

What is holding us back?

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  • Enterprise
  • Institutional reform

Every age has its institutional creativity. There are at least six that have emerged over the last two centuries:

i)        18th and early 19th century. Earl industrialisation including Enclosure and then the Poor Laws designed to move the agricultural labour force to the towns and cities. This was a time of dispossession and uncertainty.

ii)       Mid to late 19th century. Legislation to establish private joint-stock companies leading to longer-term infrastructure investment and risk-taking: Joint Stock Companies Act 1844 and the Limited Liability Act 1855. Suffrage is also widened as capitalism spreads outwards.

iii)     Early 20th. Teddy Roosevelt’s new welfarism and taking on the robber barons with anti-trust. In Britain, the early welfare state is formed. It is well behind Germany in this regard. Suffrage is widened further.

iv)     Mid-20th century. The ‘New Deal’, Marshall Plan, ‘New Jerusalem’, and Bretton Woods. This is what Karl Polanyi has called the era of ‘embedded liberalism’.

v)      1960s. Social movements for change. Equality, student protest, and beginnings of green movements etc.

vi)     1970s. Disembedded liberalism. The collapse of Bretton Woods, monetarism, and ‘Neo-liberalism’.

The above gives us a short and by no means comprehensive account of institutional history. History change is a feature of changes in human consciousness and new technologies. History, technology and consciousness evolve (or regress) together. Where the old institutional forms struggle to accommodate this change, we often experience a crisis which requires a political response.

What is notable about the current time is that we are seeing this change of consciousness (what Moises Naim calls ‘mentality’) and pervasive new technologies and the old welfare, work, public, political and economic institutions are increasingly struggling to retain their legitimacy. Where is the real institutional creativity? It is one of the mysteries of our time. Institutional ossification has led to despair rather than the political creativity of previous time.

Increasingly, we are faced with a desire to cut out the middle man and seek convenors and platforms instead:

-          In business, we share goods and services and deal direct. For example, the business crowd-funding service, Funding Circle, directly brings together investors and borrowers for mutual gain.

-          In public services choice is being (very) gradually shifted. Just last week, Simon Stevens, Chief Executive of NHS England outlined a plan to devolve budgets to those with long-term conditions further (with support from 3rd sector ‘brokers’ to provide sound support and advance).

-          In publishing, agents are now advisers/editors. You promote yourself directly to your readership and the same is true of journalists and musicians too.

-          In politics, ‘we are the people we have been waiting for’ to coin an old Barack Obama riff. We are in the ‘Homebrew Computer Club’ stage of political change (H/T Adam Lent). It’s all very garage but it will increasingly become mainstream as people realise their newfound power. Watch out if you are a traditional politician or party.

The question is how people can find a place in this less mediated world. That's where the institutions of the age matter. The RSA’s vision, the ‘power to create’ (see Matthew Taylor’s talk on it here), which argues for a democratic, mass creativity, will relentlessly focus on how people can become authors of their own lives - collaboratively. That requires new, democratic, and creative institutions. This need is encapsulated by Walt Whitman citing J.S.Mill:

“[A great nation] requires first, a large variety of character, and second, full play for human nature to expand itself in numberless and even conflicting directions.”

Mass creativity requires everyone to be included in this endeavour. This is the essence of the ‘Power to Create’. And there must be creative institutions to make this real.

What are the types of institutions we will need:

1. Inclusive Growth. This means focusing on assets, advice, networks collaboration. People need to be woven into the system. There must be an embedding of the changes we are experiencing in the terra firma of people’s lives, values, and needs.

2. New welfare/work support around life stages including access to resource to re-skill/retrain *before* people find themselves out of work.

3. Civic supports. Democracy is absolutely critical to the Power to Create. Don't hide behind passivity. America is the crucible: see Cleveland, Seattle, and Buffalo. We need to think about democracy outside of rigid structures.

Ages have their institutions but we are stuck with institutions increasingly from a previous age. We are less creative than most generations in understanding this challenge. We are going through another great transformation.

Most crucially, institutional experimentalism requires a different form of leadership. The next generation of leaders must be convenors and teachers. Think Martin Luther King rather than more deluded ‘great men’ of history. The ‘power to create’ requires institutions that provide the security and support for mass creativity. Our choice is not creativity or not; it’s creativity for all or just, as has been the historical experience, for the very few.

The above is a summary of some comments I made in a panel session on ‘the great disruption’ which can be accessed here.

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  • Thank you John, a great start.

    I am constantly taken by the 'America beyond capitalism' arguments as they look at the array of institutions that are necessary to combat 'exclusion': public venture funds in Maryland, worker networks and protest in Seattle, co-operatives in Cleveland and Buffalo, municipal ownership of utilities. There was a really good paper last week from the Centre for London which looked at local promotion of asset-ownership in companies:


    Your examples of credit unions are spot on. It seems to me that there is something deeper in the nature of credit unions and, indeed, building societies – they are hidden peer-to-peer lending platforms. The runaway success of Funding Circle shows what can be achieved. And yes, some sort of pooled resource and distribution (through the Post Office?) could help manage some risk, generate profile but could still accommodate local funding circles.

    On worker advice, I agree wholeheartedly. I just wonder whether more can be done in the working environment. Backr looks like a start (and I like Participle’s ‘Circle’ movement too). Job Centre Plus is an out of work service.

    What about in-work services that could provide advice on re-training, financial security, and new opportunities. This seems vital in an age of disappearing work. And yet, people are just left without support. Surely there could be some sort of (LA, state and individual) co-funded service that could provide high quality
    information and support? The model we are working on is still life-time employment punctuated by short periods of unemployment or sickness. This is not the regular career path now.

  • Anthony.

    Enjoyed hearing you talk about this the other day, and following on from twitter, I'll have a go at some thoughts on your institution types (which instinctively feel right to me, but I wonder if it is the correct split?) Apologies if this is a bit scattered.

    Inclusive Growth.

    My first thought is what level should this be at. At the moment, much of the debate is quite focused at the cities level. I was at the City Growth Commission yesterday, and there was a lot conversation about local authorities being the wrong scale for some of the infrastructure investment that is needed. A strong view was articulated that city regions should sort things out and just get on with it, and that was the only way to get powers from central government to deliver local ambitions. I think I agree with that for infrastructure, but not for inclusivity and people focused growth where, as you allude, it needs to be something of a network of local institutions. That being said, it needs to have a stronger brand than just a local one. My experience with credit unions is they are massively weakened by having no single brand that people can identify with and understand across the country.

    In my CU (London Capital) I have seen some good work on this. Haringey have followed on from what Glasgow did and we're going to be setting up a CU account for all young people that start secondary school, with the council putting money in. It's no Child Trust Fund, but it is an asset, it is locally owned, and it does give them a stake in a local institution. I wonder in what ways can such principles be extended to connect people to other institutions and vice versa?

    The other word you mentioned was advice, and this is something I keep seeing in some of my research in local areas in London. One of the most striking findings from a small qualitative study I have just finished in east London with 18-24 year olds was the glut of poor quality advice those young people have received. Whether from friends, family, peers or professionals, it was a significant issue for lots of very different young people. An institution that drove advice quality at all levels feels desperately needed. Often this gets reduced to a conversation about an advice service and the lack of resource for one, but I think that advice, like information, comes from all angles to us. And like information, the question is knowing which advice is better and applicable.

    Welfare, work and skills.

    This is a huge topic but I have a few quicker thoughts to get things going.

    I really like Particple and much of their work. I also think that they are asking exactly the right questions with Backr: https://www.backr.net/ (On a different recent study in one of the most deprived areas of outer London we found that the most common ways people find work are online or through word of mouth.) But from our experience of supporting people into work, I'm wondering how many people are using this. It feels like too much of an add on, rather than going with the grain of people and their lives. I know that Nick Pecorelli at the campaign company is trying to test networked approaches to supporting people into work, but it's hard to get authorities or funders to engage. There's a blockage in this idea, and I'm not really sure what it is.

    I also wonder whether we need a UK version of this?http://opportunitynation.org/

    In terms of Civic Supports, I await the thoughts of AZ!

    That's enough for now...

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