On the referendum #24D: Walter Mitty, CA, and the Guardian/Observer’s own ‘personal data harvesting’

[Update: Re the Guardian/Observer doing what Cambridge Analytica did — i.e harvest personal data not just from person X who used their app but also from all their friends, just like the central allegation vs CA! — shouldn’t the Guardian/Observer have to inform all those they did this to a) that they did it, b) whether they still ‘hold’ all this data in the ICO’s definition, c) what use they are making now of this harvested data? And if they now believe such behaviour is evil, will they destroy all such data they gathered via their Facebook appThe Guardian/Observer probably holds considerably more personal data harvested via Facebook than Cambridge Analytica ever did… Wylie pointed out yesterday, rightly, the lack of powers for the ICO. If the Guardian/Observer just deleted all this dodgy data today, then as Wylie said we would be none the wiser. Presumably Carole will push internally for ‘full transparency’?

Further, and wouldn’t this be the irony of all ironies, the Guardian itself uses ‘behavioural targeting’ and shares this data with advertisers. Did they supply CA with any data?! It seems the Guardian/Observer never checked out what they are doing themselves before they unleashed this virus of a story…]

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Hugo is half right but not in the way he thinks…

The most obvious point about the whistleblower story is that the one thing Carole has undoubtedly done is provide good evidence for something Vote Leave knew in 2015: it would be lunacy for Vote Leave to ally with Arron Banks and Cambridge Analytica. Unfortunately for Carole, her global conspiracy depends on claiming that I was secretly coordinating everything with Banks all along which is one of the reasons the story has fizzled out. The lobby knows this is untenable.

Wylie made many allegations during his testimony to the DCMS committee. Most had nothing to do with Vote Leave so I won’t comment. Regarding Vote Leave/BeLeave, on issue after issue it’s the same story with the whistleblowers: on the BeLeave bank account, expenses, who set up what when, the ‘shared drive’ (which I think they have lied to the Observer and its lawyers about) and so on — their stories change and they will be shown to be either mistaken or lying. The Electoral Commission gave us written permission to donate to BeLeave — this is a fact supported by documents presented in High Court though the media keeps writing I ‘claim’ this. VL staff and Darren Grimes behaved reasonably in trying to strike the right balance between cooperating in certain ways, which we were legally allowed and obliged to do, and ‘coordinating’ in the legal sense, which is very opaque but which we continue to believe we did not do (see long blog for details).

I will explore one of Wylie’s central claims about data that goes to the heart of the VL angle of this story. The issues around Facebook, data, targeting etc are partly quite technical. If they are to investigate such issues properly then the MPs need expert support or they are wide open to charlatans. I am very far from an expert but I’ll try to explain why one of Wylie’s central claims should not be believed.

As reported by the BBC:

‘[Wylie] said he was sure Aggregate IQ had drawn on Cambridge Analytica databases during the referendum, saying it “baffled” him how a firm in the UK for only a couple of months had “created a massive targeting operation” without access to data.’

His claim was that Vote Leave must have used the Cambridge Analytica data, passed through AIQ, to win the referendum. Wylie, describing the alleged links between Cambridge Analytica, AIQ and the specific dataset said:

“You can’t do online targeting if you don’t have access to the database. You just can’t” [11:49:50]

There are two very clear problems with this story.

  1. The Facebook data is on US voters so would have been useless in the referendum.
  2. Far from being impossible it is actually incredibly easy to set up totally legitimate/lawful targeting on Facebook without any electoral data as the Guardian/Observer knows because it does it itself and runs ‘masterclasses’ teaching people how to do it.

And, amusingly, it turns out that the Guardian/Observer itself was ‘harvesting personal data’ via its own Facebook app! Did Carole know and when did she know it?!

Problem 1: The FB data was on US voters

During his testimony, and the extensive reporting on the subject, it has been very clear that the Facebook data was specific to US voters.

As Paul-Olivier Dehaye said in the Committee meeting with Wylie, describing the dataset:

“A few hundred plus millions of Americans’ whose data is being processed by this company” [13:26:50]

Or as the Guardian itself reports:

“harvested millions of Facebook profiles of US voters”

However, data on US voters was irrelevant to the referendum and obviously wasn’t used. And Wylie accidentally undermined his own claim. When under pressure on his own possible illegal use of the FB data, Wyle suddenly blurted out the truth:

“No, because I didn’t have any UK data, I couldn’t physically offer” [to use the Cambridge Analytica dataset for Vote Leave] [13:44:50]

Which is true. There was no UK dataset and the US dataset was never used by Vote Leave or any other party in the referendum. Any responsible journalist should stop claiming anything to the contrary.

Problem 2: It’s extremely easy to set up completely legitimate targeting on Facebook

Wylie claims that:

“it “baffled” him how a firm in the UK for only a couple of months had “created a massive targeting operation” without access to data.” [BBC]

Or in an extended quote from Wylie:

“Strongly encourage looking at this question of where did they get the data? When I met with Dom Cummings, in Nov 2015, one of the things that was apparent is that Vote Leave at the time actually didn’t have any data. That’s in November 2015. Dom Cummings, in part, wanted to meet with me because he was really interested in Cambridge Analytica. He wanted to create the quote-unquote Palantir for politics. But it become apparent that if you don’t even have the electoral register, let alone a social database, you can’t really do this, or you can’t do it legally.” [11:21:50 to 11:24:00]

However, almost any company that does any online marketing could easily explain to the committee how easy it is to do completely legitimate targeting. In fact, the Guardian itself can train them how to do this in its own masterclass on social media and digital targeting!

Pic: Guardian masterclass in online marketing

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It is total rubbish to suggest that this is difficult for a political campaign, let alone impossible. It can be done, start to finish, in less than an hour by someone who knows what they are doing. When I go and give evidence to the DCMS, which sadly will have to await multiple legal actions, I could demo why they were lied to by getting someone to start from scratch on a laptop at the start of the session and shouting ‘finished’ when the DCMS is running its own targeted Facebook ad campaign with zero use of electoral data. 

What actually happened

As has been discussed publicly, what actually happened is relatively simple. Through a combination of focus groups and polling, we were aware that the people we wanted to reach were in particular demographic categories, basically ‘between 35-55, outside London and Scotland, excluding UKIP supporters and associated characteristics, and some other criteria’. We created ads, mainly focussed on the NHS, that AIQ put onto Facebook. These were targeted at this very broad segment of society, completely legitimately and with no use of American voter data (obviously!) to reach about 20% the voting population of the UK. Our use of so-called micro-targeting was minimal. Further, we made ZERO use of so-called ‘psychographic’ marketing because our campaign was informed by looking at what serious science suggests works and Big5/OCEAN profiling for politics is very marginal (and expensive) at best.

Our best tools were not super-sophisticated digital targeting — the supposed Jedi mind-bending superpowers that Carole thinks we have — but 1) learning from books thousands of years old about how to manage complex operations and 2) listening hard to the public rather than the pundits.

Conclusion

We have two competing claims.

From Chris Wylie, that it is almost impossible for Vote Leave to have done targeting without access to the Cambridge Analytica dataset.

From Vote Leave, a claim that this is not only possible, it is trivially simple.

If you want to decide between these two, we suggest that you sign up to the Guardian/Observer masterclass on targeting and see for yourself!

There is an amusing kicker. The Guardian/Observer themselves run targeted ads on Facebook.

Pic: The Guardian/Observer targeted Facebook ads

Screenshot 2018-03-28 14.21.08

As previously discussed, Chris Wylie comments that “You can’t do online targeting if you don’t have access to the database. You just can’t”. He also states on the record that he had access to the complete Cambridge Analytica data, and gives no concrete evidence he deleted it. While this data was useless for Vote Leave, who didn’t operate in the US, it would be useful for the Guardian, who do operate there. If you believe Wylie’s testimony, one might conclude that the only way the Guardian could be doing online targeting is through access to Wylie’s version of the Cambridge Analytica dataset!

Of course, I don’t believe this. I believe that the Guardian, just like almost every other company doing digital advertising, and just like Vote Leave, is operating completely within the law. But to spare itself further embarrassment over its Walter Mitty whistleblower, the Guardian should admit that it’s possible to do targeting without access to the Cambridge Analytica dataset, just as they do. And of course this directly conflicts with one of the many bullshit claims by Wylie about the Cambridge Analytica story.

Could I have an answer on the record, please Carole?

Further, in another amusing irony, check out the Guardian/Observer’s own iterating privacy policy — or should we say, ‘anti-privacy policy’?! — on its Facebook app. Yup, they were themselves doing just what they are claiming (falsely) Vote Leave exploited and what they say is destroying democracy — harvesting personal data via their app! Nice work Carole, but please remember — Vote Leave never stooped so low!

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Finally, in another extreme irony alert… Fair Vote, the vehicle for Blair and Osborne to attack Vote Leave and campaign for a second referendum (funded by??) is … wait for it, chasing people around the internet recruiting supporters USING TARGETED ADS!

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Dear Observer, Channel 4, Fair Vote, you are an absolute bunch of charlatans — start getting ready for Brexit, your weak Zoolander story is going nowhere.

For the avoidance of any doubt, as I have said many times for over a year…

  • VL did not work with Cambridge Analytica directly or indirectly.
  • We never had, or sought access to, the FB data in question.
  • Microtargeting is an important issue but played practically no part in the VL campaign.

Ps. Also it’s not my job to protect Facebook but hacks keep circulating a video of Zuckerberg saying to the BBC that he would not ‘sell people’s data’, with comments to the effect that ‘what a liar Zuck is’ etc. Practically nobody seems to realise that Facebook did not sell that data! Facebook consistently put user experience ahead of revenue (hence partly why it has flourished while competitors blew up) and its business model does not involve selling personal data as per this clip.

As I suggested a year ago newspapers need to hire specialists who actually understand these issues to advise its political reporters/pundits. There are real issues about data/elections/platforms but pundits make sensible debate harder when they accuse campaigns and Facebook of things they never did. Stick to the facts guys, that’s tricky enough to deal with…

If you want to read someone who actually understands this story ignore people like Hugo Rifkind and read this.

Another excellent piece, one of the best I’ve read on CA snake oil.

Some links

http://www.bbc.co.uk/news/uk-politics-43558876

https://www.theguardian.com/guardian-masterclasses/2017/feb/15/how-to-develop-a-social-media-strategy-for-your-retail-business-digital-course

https://www.theguardian.com/guardian-masterclasses/2015/jul/03/advanced-social-media-for-businesses

https://www.theguardian.com/news/2018/mar/17/cambridge-analytica-facebook-influence-us-election

https://dominiccummings.files.wordpress.com/2017/01/20170130-referendum-22-numbers.pdf

https://parliamentlive.tv/Event/Index/28e9cccd-face-47c4-92b3-7f2626cd818e

LA Times piece with lots of comments from various people about why CA is snake oil.

On the referendum #24C: Whistleblowers and C4/Observer accusations — they promised Watergate and delivered Zoolander

Update: More unethical behaviour from @Jolyonmaugham

I wrote yesterday about a formal complaint to the Bar Standards Board regarding this ‘QC’ (scroll down).

Today he tweets:

Screenshot 2018-03-28 12.17.09

Yet again this charlatan spreads bullshit on the internet about serious issues that are the subject of legal investigations without doing the most basic fact checking. If he had, he would have seen immediately that Michael Gove was never on the Board of Vote Leave. That’s a ‘fact’ Jolyon. (Further neither Gove nor Boris had anything to do with such matters as legal compliance.) The decision re a donation to BeLeave was taken by the Vote Leave Finance Committee (a subset of the Board) after we suddenly got the written confirmation from the EC that we could donate to BeLeave — another fact, supported by documents presented in the High Court, which @Jolyon spread false memes about. Full documentation exists for the EC to consider. Journalists should treat him not as a serious QC but as another spin doctor for a political campaign since that’s how he behaves on social media.

UPDATE 27/3. DEATH TO SPIES!

This tweet from Carole sums up how serious this story really is in so far as it relates to Vote Leave: of course, SMERSH (Russian abbreviation for ‘death to spies’)! The EC/ICO inquiries will look at the facts, the completely different stories that the whistleblowers tell each time they appear (their credibility is such that I bet their lawyers won’t let them appear as witnesses), the evidence, and the law. By the time the inquiries are over, the Observer will look really silly for making a hero out of a fantasist-charlatan, we’ll already have left the EU, and Zoolander will need a new look… The one thing Carole has provided good evidence for is something Vote Leave already knew in 2015: it would be lunacy for Vote Leave to ally with Arron Banks and Cambridge Analytica!

Screenshot 2018-03-27 11.15.52

Screenshot 2018-03-27 11.22.35

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UPDATE 26/3. It’s been suggested to me that I should put in a formal complaint about the lawyer @JolyonMaugham to the Bar Standards Board. His twitter feed alone is a disgrace to the bar. He has been guilty of at least reckless falsehood. Strikes me this would be a good public service so feel free to send evidence about him to my public email and I’ll send in a formal document with help from some barristers. Public debate is badly undermined when QCs spread bullshit on the internet.

And on this subject, it was noticeable that in the hearing over a judicial review on the Electoral Commission recently all three teams were criticised by the Court: Jolyon’s, the EC’s, and VL’s. The JR won’t effect Brexit at all but it will affect future conduct in elections and the debate about reform. As I wrote in my long piece on the referendum a year ago the rules about our elections are a joke and regulators are in an impossible position (e.g the latest flap over what counts as ‘coordination’). It would be in the public interest if all three teams upgrade their lawyers for the JR in the summer so these arguments are properly made and contribute to serious reform of the whole system. (I have zero role with VL and have not been a director since early 2016 so these decisions have nothing to do with me.) 

NB. I respect @JolyonMaugham’s right to free speech and to express his political views on Twitter. Please only send examples of things that can genuinely and reasonably be seen as misconduct for a barrister such as misleading people or deliberately mistating the law. I have no interest in his politics, just his integrity and professionalism. There will be a very strict test applied by my team about what we say. Just the facts please…

[Added.] In particular, I am unaware of any document presenting clear and full transparency concerning the finances of his Good Law Project and how much he collects for his own ‘fees’. Do those who donate think he is working for free? Is he? If not how much does he take? Does he make it public? If not why not? Is his behaviour concerning raising and spending this money ethical?

A team will also be putting in formal complaints to the EC and ICO about the illegal conduct of the Remain campaign, Osborne, Blair, Cameron, Mandelson, Clegg, Craig Dre et al. Don’t start deleting emails guys, cos that would be illegal, but start saving for lawyers. Meanwhile, we will also be starting our own campaign for a second referendum — on the ECHR…


UPDATE 24/3: My response to Channel4/Observer/NYT ‘world exclusive’: They promised Watergate and delivered a dodgy Zoolander. Vote Leave’s donations were legal, the Electoral Commission gave us written permission, the whistleblowers are provably lying, we leave in a year and this lame gossip won’t even be a historical footnote.


Here is the Channel 4 / Observer ‘exclusive’ about to air this evening, leaked to me by an ‘appalled’ journalist in the C4 newsroom…

Their whistleblowers are already discredited as liars and charlatans. Wylie tried to sell me the same crap he accuses Cambridge Analytica of doing — and I told him to get lost (in writing). Shahmir told a completely different story to a previous investigation, which evidence will be with the Electoral Commission.

Accusations from the dishonest @Jolyon that Vote Leave did not have permission from the EC to give donations to other campaigns were disproved in open court just days ago when the documents were revealed, and @Jolyon was criticised by the court for his conduct.

C4 and Observer think this will help cancel the referendum.

They are deluded.

SW1 will have one of its frequent hysterical waves, soon replaced by the next such wave.

We’re leaving the EU next March.

Then we’ll be coming for the ECHR referendum and we’ll win that by more than 52-48…

For the details of why their accusations should not be believed, SEE HERE.

There won’t be a Scooby Doo ending to this story where my mask is pulled off and it turns out Arron and I were working with Cambridge Analytica all along, and the cops say ‘they’d have got away with leaving the EU if it weren’t for that journalist Carole’.

(We wish all whistleblowers well.)

CHANNEL 4 news release

BREXIT CAMPAIGN WAS ‘TOTALLY ILLEGAL’, CLAIMS WHISTLE-BLOWER

‘Data, Democracy and Dirty Tricks’ – Part 4 

Please credit words and pictures to Channel 4 News

Tonight, the whistle-blower who was “outed” as gay by the PM’s political secretary in a row over cheating claims in the Brexit campaign, tells Channel 4 News that “people have been lied to” and that the EU Referendum “wasn’t legitimate.”

In an interview with Channel 4 News to be broadcast tonight (Saturday at 6.30pm GMT), Shahmir Sanni tells Michael Crick: “I know that, that Vote Leave cheated… I know that, that people have been lied to and that the Referendum wasn’t legitimate.

“Leaving the European Union, I agree with. But I don’t agree with losing what it means to be British in that process; losing what it means to follow the rules; losing what it means to be quite literally a functioning democracy.”

Sanni believes Theresa May’s political secretary Stephen Parkinson “outed” him yesterday after he was set to reveal claims of cheating by Brexiteers. Parkinson says the two had been in a relationship for 18-months, which he then implies may explains Sanni’s motive for speaking out.

Channel 4 News can also reveal that Sanni went to the Electoral Commission with two other pro-Brexit friends on Thursday, who say they helped the Vote Leave campaign two years ago.

They told the Commission in detail why they think Vote Leave broke the law during the Referendum, and exceeded the legal spending limits.

Earlier last week their lawyers gave the Commission signed statements from the three whistle-blowers. Channel 4 News has seen a duplicate of the 46-page account prepared by two top QCs, and three thick ring-binders of supporting documents.

The cheating row centres around the links between Vote Leave and third-party campaign group Beleave.

Under election laws, Vote Leave was only allowed to spend £7m on its campaign. But there were scores of other separate campaign groups who could each spend up to £700,000, if they registered as permitted participants.

However, spending by each of these groups had to remain truly independent of the main designated campaigns.

Sanni tells Channel 4 News he was initially a Vote Leave outreach volunteer. But it’s claimed Stephen Parkinson then assigned him to another Brexit group called BeLeave, where he worked with the group’s founder, Darren Grimes.

BeLeave was based inside the Vote Leave headquarters and Grimes was photographed holding a Vote Leave poster on the day of the Referendum.

Sanni says that he and Grimes always reported to Stephen Parkinson.

“There was no time where anything BeLeave did didn’t go through Stephen,” Sanni said. “Any sort of article that I posted or an article that I wrote, I would run it through Stephen. I would say ‘is this OK?’.”

“This was after we had become a separate organisation – I sent Stephen a draft of my speech, and said ‘Hey, what do you think?’ I sought advice, as did Darren.”

Together, they claim they worked hand in glove with Parkinson.

In the last ten days of the campaign, Vote Leave donated a total of £625,000 to Grimes, who was registered as a permitted participant. The donations went directly to Canadian data firm Aggregate IQ (AIQ).

Sanni claims that Grimes was not truly independent of Vote Leave and was not in control of how the money was spent.

He claims Grimes and BeLeave were used by Vote Leave to get around limits on how much they could legally spend. If true, they could have overspent by almost ten per cent.

Documents seen by Channel 4 News show multiple links between AIQ and Cambridge Analytica’s parent company SCL.

Speaking about the donation, Sanni said: “When Darren told me that it was almost £700,000, the first thing I asked was ‘OK, so can I get my, you know, some of my travel expenses refunded, reimbursed?’,” he told Channel 4 News. “I didn’t have a job, I had just come out of graduation and I was volunteering.

“So I asked for money and Darren said ‘No I don’t think we can… the only way for them to give it to us is if they give it to AIQ.’ And that’s where at first I was like oh that’s a bit odd…”

Asked whether they could have refused to spend the money on AIQ, Sanni said: “We didn’t ever feel like we had that level of control. That’s what I mean, we never felt like we had control over the or, over the organisation itself…

“We were delegated responsibilities … but in terms of sort of money, we never had a say over that. We never had control over that.”

He claimed: “In effect they used BeLeave to over-spend, and not just by a small amount… Almost two thirds of a million pounds makes all the difference and it wasn’t legal… ”

“They say that it wasn’t coordinated, but it was. And so the idea that… the campaign was legitimate is false.”

Tonight, Stephen Parkinson issued a “personal statement” to Channel 4 News:

“I have seen the statements issued by Shahmir and his lawyers, and am saddened by them. They are factually incorrect and misleading. My statement to Channel 4 News and The Observer was issued in my personal capacity and was solely a response to the serious and untrue allegations made against me by Shahmir, Chris Wylie, and others.

“It would be surprising if Shahmir, Mr Wylie, or those advising them thought I would be able to defend myself against those allegations without revealing my relationship with Shahmir. Sadly, the allegations they have chosen to make are so serious that I have been compelled to do so. I cannot see how our relationship, which was ongoing at the time of the referendum and which is a material fact in the allegations being made, could have remained private once Shahmir decided to publicise his false claims in this way.

“The matters raised in tonight’s Channel 4 News programme are already with the Electoral Commission.

“At the relevant time during the referendum period, the Commission advised Vote Leave that it was permissible to make a donation in the way it proposed to do to BeLeave.

“Twice since the referendum the Commission has investigated this matter, and twice it has found no evidence of wrongdoing. A third investigation into the same issue is currently taking place.

“The Electoral Commission has not contacted me in relation to any of these inquiries, but I will of course be happy to assist in them if they wish me to do so.

“I firmly deny the allegations in the programme. I had no responsibility for digital campaigning or donations on the Vote Leave campaign, and am confident that I stayed within the law and strict spending rules at all times.”

A solicitor for Vote Leave said: “Vote Leave has twice been cleared on this matter by the Electoral Commission. There are a number of new accusations and allegations being made in what you have sent us. While many of them seem irrelevant or trivial, some are serious and potentially damaging to the reputations of those caught up in those allegations. As has been the case throughout, Vote Leave is obligated to review – to the extent it can after this long elapsed period since the referendum – all such allegations, and is doing so. We will as appropriate share any relevant findings with the Electoral Commission, again as we have always done. “

Darren Grimes denies all the allegations.

Lawyers for AggregateIQ said: “AggregateIQ is a digital advertising, web and software development company based in Canada. It is and has always been 100% Canadian owned and operated. AggregateIQ has never entered into a contract with Cambridge Analytica. AggregateIQ works in full compliance within all legal and regulatory requirements in all jurisdictions where it operates. It has never knowingly been involved in any illegal activity.

‘All work AggregateIQ does for each client is kept separate. The services carried out by AggregateIQ for Vote Leave were in accordance with the instructions of Vote Leave. The services carried out for BeLeave were in accordance with the instructions of BeLeave. The accounts were kept separate at all times and there was no overlap or merging in any way.’

Note to editors:

For websites, clips are available to be EMBEDDED FROM @CHANNEL4NEWS TWITTER ACCOUNT ONLY – from 6pm.

For broadcasters, can be provided with two clips – with full credit to Channel 4 News.

For clips please contact: ITNP news desk +44 207 430 4668 News@itnproduction.com

On the referendum #24B: Whistleblowers, ‘outing’, the ECHR

Below is a section of yesterday’s blog that has been changed and changed again in odd circumstances. It will be convenient to put it into a separate blog so people can follow easier…

EDITED SECTION OF YESTERDAY BLOG…

I didn’t know anything about the personal relationships between Wylie/Shahmir/SP until a few days ago but here is Stephen Parkinson’s (SP) statement:

‘I was not introduced to Shahmir Sanni or Darren Grimes by Chris Wylie as he is claiming, but by a mutual friend from university. Shahmir became an occasional volunteer for Vote Leave and other leave campaigns, and we began a personal relationship. We subsequently dated for 18 months, splitting up – I thought amicably – in September 2017. That is the capacity in which I gave Shahmir advice and encouragement, and I can understand if the lines became blurred for him, but I am clear that I did not direct the activities of any separate campaign groups. I had no responsibility for digital campaigning or donations during the referendum, and am confident that Vote Leave acted entirely within the law and strict spending rules at all times.’


[Added the next day… The statement above was originally on this blog yesterday. Then I got requests on behalf of Shahmir to remove it on the grounds that relatives in Pakistan might get killed. Then Shahmir put out his own statement admitting the relationship and attacking Parkinson for ‘outing’ him. So I have restored the statement above and left the below here, so people can see the weird context. 1) Given the nature of Shahmir’s accusations against the Prime Minister’s Political Secretary, no reasonable person would have thought Parkinson could explain all this to the PM and media while hiding the fact of their relationship. 2) Shahmir’s behaviour is not consistent with someone prioritising relatives ‘at serious risk’ in Pakistan, to say the least. 3) Shahmir is unquestionably telling lies about BeLeave — either he was lying to VL’s board member in charge of compliance, who has detailed written notes taken after talking to Shahmir in 2016 about the independence of BeLeave (when Shahmir said it was all ethical and legal), or he is lying now. There’s no third alternative. Given all the other evidence about this, a reasonable person will conclude he’s probably lying now. Maybe it’s connected to his relationship (used in a general sense) with Wylie, maybe not. 4) Wylie literally has described himself as ‘a smear merchant’. Are the media going to report seriously allegations from someone like this? 5) An interesting side issue is that the legal point Shahmir’s lawyers used to try to gag the media yesterday is an ECHR point. It is absurd in principle and this case is a good example of why: person X makes accusations publicly about person Y then gets lawyers to tell Y ‘you can’t answer these accusations in a way that reveals anything about my sex life even if it’s directly relevant to the accusations’. The ECHR creates these legal problems all the time. The media should have had more courage to defend the public interest yesterday and ignored this argument. If I get involved in politics again, then a referendum on the ECHR should be high on the agenda — and bear in mind most people probably think we’re already leaving it because of the 2016 referendum, so imagine how mad they’ll be when they realise we’re still in it.]

[XXX NB. I have removed this statement. I have been sent a letter apparently from lawyers saying people might get killed as a consequence and asking me to remove it for their safety. Despite this being entirely the Observer’s/C4’s fault, I obviously won’t take any risk that people are physically attacked. I will take steps to discover if Bindmans are acting in good faith, whom for, and so on. If I think communications from Bindmans or subsequent coverage by CC/C4 reveal a lack of good faith, and seek to use my removal of this statement to claim, in any way shape or form that I have admitted fault/liability etc about anything, or make dishonest claims about the relationships of specific people because they think they can keep certain details secret using legal threats, then I will put it back up immediately as they will have revealed they were lying about physical dangers for political advantage. It is in your hands, CC/C4 and whistleblowers — I’m cutting you a break you don’t deserve. Journalists please note that I’m unclear what is happening and I’m just assuming this email is genuine given the scale of the issue. Also NB. the legal issue at stake concerns an aspect of the ECHR — and this reminds me that another project we need to get going is a referendum on that, much easier to win than the EU, we’ll win 65-35…]

On the referendum #24: Global conspiracies and a Scooby Doo ending?

‘My feeling about Brexit was not anger at anybody else, it was anger at myself for not realising what was going on. I thought that all those Ukip people and those National Fronty people were in a little bubble. Then I thought: “Fuck, it was us, we were in the bubble, we didn’t notice it.” There was a revolution brewing and we didn’t spot it.’ Brian Eno, with more self-awareness than Blair, Cameron, Osborne, Mandelson et al.

Carole Cadwalladr (CC) and Channel 4 (C4) have sent me and others involved in Vote Leave (VL) a list of questions concerning the referendum and allegations from Wylie and other ‘whistleblowers’. CC’s letter is attached below verbatim with only some names and libellous details about others deleted.

This is part of a long-running attempt by the Observer to claim that 1) VL was involved with Cambridge Analytica (CA) in a global conspiracy involving a nine-month long fight for the designation as the official campaign, covered intensely by the media, that was ‘really’ the most elaborate cover story since the D-Day deception operation, and 2) VL acted illegally in making donations to BeLeave (BL) and other campaign groups.

Because of Facebook’s incompetence in dealing with it (itself an interesting issue given it is so effective in other ways), this story has, ludicrously in most ways, gone global. Having mostly ignored it for 18 months, and now getting a string of hysterical emails from the media, I might as well try to explain some background to this nonsense then explore some details, including some details about the supposed whistleblowers including Wylie, who, I (re)discovered yesterday, tried to flog me the same crap he’s attacking CA for doing. I’ve also put in some links to serious work on some of the issues such as fake news and the effects of marketing and put in some names for journalists to call if they want details.

You’ll see some of this play out in the papers and on TV over the next few days. But at the end of it we’ll still be leaving the EU, CA will still be charlatans, and the media still (mostly) won’t explain data and (digital) marketing well.

The overall conspiracy — hedge funds and secret superpowers

Many powerful people, and journalists at the Guardian/Observer, got a horrible shock on the night of 23 June 2016. Rather than face reality many of them have created a fantasy and sold it hard. In doing this they are, ironically, mirroring those they say they hate.

Their fantasy involves a general argument that they lost the referendum as a local consequence of a global phenomenon — the world has been swept by a ‘new age of unreason’ as Osborne puts it. Yes, Osborne — the yacht-party drinking buddy of Putin’s oligarch sidekick Deripaska, the famously honest and scientific Osborne. Fake news and Facebook posts conned millions of ignorant people who don’t understand how the world really works, which we do, so they think. In this fantasy they are joined by legions of mainstream economists for whom it is obvious that Brexit is a disaster and those who voted for it are idiots or fantasists. These economists bounce from day to day convincing themselves that it was always obvious that what just happened was bound to happen — they must be constantly puzzled as to why they aren’t trillionaires.

This fantasy is much more convenient to believe than it is to face the fact that their campaign managed to lose despite having practically every force with power and money in the world on their side. How much easier is it on the psyche for Blair et al to avoid reflecting on why people didn’t trust them personally (e.g WMD/45 minutes) and didn’t believe their arguments (e.g remember the ‘immediate recession’ almost the entire economics profession predicted?), and didn’t trust their motives (e.g notice how all these powerful people from whichever party get rich and defend thieves who steal from the public?). How much easier is it to ignore the policy and management errors of those in charge from all parties (e.g Blair and Cameron simultaneously losing control of immigration AND not building public service infrastructure) that have led millions to conclude governments are run by incompetent crooks. How much easier is it to wallow in the feeling that they are heroic guardians of the truth fighting a malign global force. The relatively rich and privileged political-media world that almost entirely missed Brexit and the reasons for it has largely swallowed this comforting meme and spent two years talking, as usual, mainly to themselves.

This is the background psychology.  

How wonderful, then, for there to pop up a story combining: Trump, Putin, Bannon, hedge fund billionaire and AI researcher Robert Mercer, an ominous sounding digital company, Cambridge Analytica, led by a gobby Etonian, then smash it together with Vote Leave, Farage, and the battle to control the referendum (best described by Shipman in All Out War). It feeds the psychology perfectly. A conspiracy of baddies (Putin, Trump, Farage, hedge funds), dangerous sounding technology (that approximately nobody in politics/media actually understands), awesome superpowers wielded by secret forces (often a powerful meme historically) and so on — the perfect conditions for ‘unreason’ to flourish.

Add on top of this a media-obsessed clown, Arron Banks, who having lost the designation battle to Vote Leave was desperate to claim any sort of role in the referendum so decided to brag after the vote about working with Cambridge Analytica ‘using AI’, before realising he had opened himself up to charges of illegality (viz reporting expenditure) and therefore quickly reverse-ferreted to say that everything he’d claimed had been to ‘wind up’ journalists. Having claimed CA was super-cool, he now claims he always realised they were charlatans. Of course, he couldn’t admit the truth — pure self-aggrandisement — and still can’t, caught between two incompatible lines of bullshit. Banks fits the bill perfectly for CC to fit a specific global conspiracy into the underlying psychology. ‘Evidence! Facebook! AI! Admitted!’

Ironically, the main reason for so much bad blood before the referendum campaign started was that a powerful network of MPs, donors, peers, and assorted ‘campaigners’ bought Banks’ bullshit about building a ‘digital army’. Powered by invincible ignorance, this network maintained that Banks was a digital guru who had hired a brilliant company to ‘do digital’ and Vote Leave should merge with them and let Banks control all data/digital elements of the campaign. Over and over again I would have meetings explaining ‘Facebook doesn’t work like that, Banks is spinning you crap, if he could do what he and CA claim then they’d be trillionaires, not hustling you for a few grand’ and on and on. Even though his supposed digital army consisted largely of Wigmore publishing offensive things they had to retract and apologise for, few in SW1 cottoned on at the time that he was a grade A bullshitter. A depressing time.

I and the other key people who ran Vote Leave told this network, which at one point extended dangerously into our own Board — ‘no way, they aren’t competent to run anything and they aren’t fit to have any role in the referendum, we will not work with them in any way’. Hence the war and Banks throwing everything he had not at Cameron and the Remain campaign but to replace me. VL’s relationship with Leave.EU was best described by Banks when he told the Times that he viewed Vote Leave as ‘the real enemy’.

It is doubly ironic, therefore, that the Guardian/Observer has tried to wrap VL and its staff into the CA story claiming, literally, that the entire fight over designation, and the coup to replace me, was really a deep cover charade designed to hide the fact that we were all secretly working together: ‘covert coordination’ as CC describes it in one of her stories. The author of the most authoritative book on the campaign, Tim Shipman, was asked about the probability that this deep conspiracy is true and replied — ‘zero percent’. The reason CC’s stories stayed in the ghetto of the Observer for 18 months until they escaped, like a virus a week ago to infect the global news system, is that approximately zero political journalists in the UK could buy this tale. Read Shipman’s account of the coup to remove me and subsequent events, think of all those involved, and ask yourself how likely it is that we acted all this out in an unprecedented political theatre. If I could do that, I’d be a trillionaire.

Another problem with CC’s theory is it requires that you believe simultaneously that a) Mercer/Putin et al are so brilliant and powerful they could orchestrate this global conspiracy AND b) it fell apart because they’re so dumb they entrusted the Brexit arm of it to Banks and Wigmore who promptly blabbed the whole dastardly scheme on the record to CC by mistake. For this story to be true would be like finding out that Trump ran for President as part of a secret plot with Obama. Could you prove it didn’t happen? Technically no but what would you bet on a theory like that being true?

CC’s bit of ‘evidence’ for this conspiracy? That a company which did digital execution for us, AIQ, once built some software for SCL in 2014. This is used to justify the claim that AIQ is legally obliged to hand over data from every client they ever have to SCL/CA. Of course, this is ludicrous. a) Such a contract would be illegal and unenforceable. b) AIQ was specifically bound by their contract with us not to share any data with anybody and to obey English law. c) AIQ has made clear that they never shared any of our data with anybody directly or indirectly. AIQ behaved professionally, they were careful about personal data, and I have no reason to think they were lying to VL and risking the destruction of their business and criminal prosecutions. [Added shortly after publication: NB. This ‘evidence’ was published by the Observer months ago — it isn’t new.]

Up against tough competition, the whole story is the most loony accusation I’ve ever faced in 20 years in politics. In normal times, such a loony story would get no play but these aren’t normal times. A powerful set of people will do anything to try to shift public opinion in order that they can overturn the referendum.

Leave aside the conspiracy: does what CA does work?! Does CA have superpowers to change minds, denied to other mortals?

Well one part of what they claim to have been doing definitely works. This week Nix was filmed in a sting operation on C4. On TV he was selling CA not on the basis of ‘super-sophisticated AI’ but on a very old trick — using super-hot Ukrainian girls to blow politicians up. When I lived in Moscow I met some girls who worked on KGB honey traps and I’ve got a lot more confidence in their methodology than I do in CA’s ‘psychographics’, though unfortunately for Nix, the Moscow approach ‘doesn’t scale’ as they say in the Valley. There’s not that many Milla Jovovich lookalikes with the right skill set.

These old school games are not what Nix was selling publicly. What about this ‘psychographic’ stuff?

I won’t go into any detail on this but just make some obvious points largely ignored.

The first thing to realise is that it is very hard to show that ANYTHING done in political campaigns / advertising works reliably.

Of course sometimes memes take off and some commercial advertising campaigns are a great success. But nobody has found a way to turn this into a method for reliably influencing politics.

Much of the political science world is dominated by bullshit ‘research’ and their claims cannot be relied on. One of the few reliable and interesting scholars in this field is David Broockman at Stanford. He recently published a big and interesting study including randomised control trials to detect campaign effects: The Minimal Persuasive Effects of Campaign Contact in General Elections: Evidence from 49 Field Experiments, Stoockman et al 2017. The conclusion? Almost everything campaigns do in America has no discernible effect when tested with RCTs. (NB. this finding was for US party elections — referendums are different.)

This broad conclusion holds for digital marketing. Almost all claims you read are bullshit, particularly if they involve CA’s magic potion of Big 5 personality type marketing. Is everything rubbish? No. Is there a method demonstrated to have reliable big effects? No. Does CA have Jedi powers? According to the experts, no chance.

It is hard to change people’s minds. We are evolved creatures. If we were all dopey dupes we wouldn’t be here, our ancestors would have all been killed. You’re reading this because your ancestors survived a brutal competition of sexual politics, this involves deceit and perceiving deceit, and this makes it an extremely non-trivial task to change minds at scale reliably in a competitive landscape. If it were a trivial task, our entire world would be unrecognisably different. People are always selling the idea that they have a magic bullet of persuasion. You won’t get poor by shorting such promises.

Do some companies have great power? Yes but only in limited ways. Facebook is in many ways a great company and Insider sneering at Zuckerberg is largely jealousy. (Their current problem is a consequence of senior people there not understanding rapidly changing political dynamics but they’ll learn about politics faster than the politicians learn about engineering.) But Facebook cannot program fashion and opinions. Neither can marketing companies — almost all they do fails. Nobody can in free societies (Communist/fascist countries are obviously a different argument.) It’s too complex. Facebook, like great politicians, surfs waves that it very rarely (if ever) creates. CA is a normal company in its field in my experience — it exploits the ignorance about marketing, data science, and psychology to sell snake oil to gullible people who almost never have the technical education to question them scientifically. That’s normal. What’s abnormal is that a large section of the media takes snake oil so seriously and suspends their usually hyper-critical faculties. The reason is that politics is melting their brains.

What about CC’s latest attempt to wrap all this up together?

CC has published a string of stories on all this, culminating last weekend with the whistleblower story on CA. This story had no relevance to Brexit. The core of the story is: an academic sucked data out of FB (using an API) for research (legal) then shared it with various people including CA (against the terms of his agreement with FB, possibly illegal). The combination of a ‘whistleblower’ with pink hair, a huge botched job by FB, quite clever coordination with the New York Times which has a very strong incentive to blame Facebook for Trump (rather than their own coverage of Hillary’s emails and so on, which dwarfed all ‘fake news’ social media in impact — cf. physicist Duncan Watts for detail), and the desire of many established players to screw Silicon Valley tech companies gave the story more legs than her previous ones.

FB has undoubtedly behaved incompetently over this and given a clear impression they do not care about users’ privacy, though almost everything you read about ‘Facebook selling your data’ in the context of this story is also rubbish. If you want to understand the complex facts, talk to someone like Benedict Evans (Andreessen Horowitz, one of the handful of the Valley’s top VC firms) or Antonio Garcia Martinez (former FB employee) who really understand FB’s business and the real details of their advertising model.

This story going global is a great example of how little facts matter and how much context matters when looking at news. Facebook’s screwup has been in the public domain for two years. Everybody ignored it. (From FB’s perspective, it’s a commercial equivalent of Obama’s campaign in 2007/8 ignoring Reverend Wright until it blew up in their faces — when it happens everyone says ‘how could we have ignored this?’). Add a few spicy elements to the coverage (Whistleblower), some intrigue (Nix’s car crash undercover filming), and a different political context (post-Brexit and Trump) and the same media and political people behave very differently. (Duncan Watts wrote a great paper about the role of randomness in social life and what makes ‘hits’ in Science, HERE, and this story is a good example.)

What about CC and her motives? Cadwalladr is a passionate supporter of Remain. She’s said that ‘the ideology of Brexit strikes against the idea of ourselves as a people in the most intimate way possible’. A quick glance of her tweets and you will find stuff like ‘Brexit STINKS’. In articles right after the vote she described Leave voters as ‘canon fodder… Lied to and manipulated and deceived’. She also claims ‘where was the counter-argument [to Vote Leave]? Nowhere’ ignoring the fact that Remain dominated TV news for a year with the exception of about 10 days. After the 2017 election she also insinuated that Vote Leave shared data with the Tories — again alleging criminal behaviour completely without any foundation. You get the picture. It’s OK to hate the result. Unlike many on the other side I have no reflexive dislike of people who voted differently to me. I never regarded the other other side as fools or evil the way Insiders do about Leave voters — which is one of the reasons they lost, as this mindset blinded them to reality beyond London. But it is very clear she regards herself as a campaigner and is in no sense an objective journalist dealing with both sides fairly.

Facts on BeLeave

BeLeave was set up up by Darren Grimes, a student, independent of VL. He was introduced to VL by people who had worked with him on Liberal Democrat campaigns — though not by Chris Wylie, as he is now claiming. Other VL staff were impressed by what became BeLeave around Christmas 2015 when they noticed Darren using a #Beleave hashtag on twitter and campaigning online. Some VL staff gradually got to know them as they did many other independent groups. They visited our offices. We helped them in various ways, which was legal. Inevitably people became friends and met socially, which was legal (for American readers / NYT the laws are nothing like those for PACS).

Our relationship changed a few weeks before the vote. In the later stages of the campaign, the Electoral Commission was under pressure over Government conduct. For example, Cameron had done an event at the British Museum. This would mean counting the expense (many thousands) against Remain’s ‘controlled expenditure’ if it counted as a Remain event. Remain claimed it was a ‘government event’ and there was no ‘coordination’ therefore no need for them to register any expenditure as theirs. If in fact it was ‘coordinated’ between No10 and Remain then it would count as ‘controlled expenditure’. If No10 and Remain lied about coordination, that would be illegal. The EC accepted government assurances. There were many such incidents for both sides.

Suddenly in May, at the height of the disputes described in the paragraph above, the EC told us that we could make donations to other campaigns. The idea that campaigns could donate to each other AND such a donation would not have to count as part of our expenditure, AND would not be regarded a priori as ‘coordination’ was a surprise to me and others. So we sought clarification from the EC and got it. We then made donations to BeLeave and others. Having struggled to raise money since we started a year earlier, at this point (roughly a month before the vote) we had the opposite problem: money was suddenly flooding in as donors thought we might actually win (almost nobody thought it possible before). So we gave some of it to other independent campaigns as the EC said we could.  Everything was properly recorded and declared.

To be fair, this does prima facie seem weird. Why? Because campaigns are not supposed to ‘coordinate’ — if they do, then their expenditure must be combined. Given this, it would be reasonable to think that donations are a priori excluded. But the EC told us the law says they aren’t. (See details and documents below.)

The law defines ‘coordination’ as incurring controlled expenditure pursuant to a plan or other arrangement. Nobody really knows what this means including the EC. To give an example… In his book Unleashing Demons, Craig Oliver describes a daily call he ran with various Remain groups: ‘I join a 7.30 a.m. cross-party call chaired by Will Straw. It’s designed to catch up with what the In campaigns for the various political parties are doing that day. I want to get across a blunt message: this matters. We failed on immigration yesterday, hardly anyone stuck to our line that we accept it’s a problem, but Leave’s solution of trashing the economy is no way to deal with it.’

Many have construed this as illegal particularly given the EC also states that ‘In our view, you are very likely to be working together if … you coordinate your regulated campaign activity with another campaigner – for example, if you agree that you should each cover particular areas, arguments or voters’ (emphasis added). The EC says the above example doesn’t fall within this definition — so you can see just how hard it is to interpret what they will say about anything. VL had a meeting with groups (though more like fortnightly and did not discuss media lines) because we were also under an obligation as the official campaign to discuss the campaign with other leave groups. This was one of the reasons that the EC gave VL the designation — because we were talking to the disparate leave groups and therefore best represented the whole coalition. The two official campaigns were, therefore, effectively obliged both to ‘coordinate’ others by the EC’s designation criteria, in one sense of the word, and we were also forbidden to ‘coordinate’ in the legal sense of the word, though nobody including the EC itself could define clearly what this meant and where the boundaries were (and they still can’t).

Another example was the Remain campaign’s Ryanair event with Cable, Balls and Osborne. We were told repeatedly that if we did a joint event with X and X spent money on say the setting (arranging vehicles etc) then we would have to assume responsibility for the cost. But when the Government did an event with a huge airplane emblazoned with the Remain campaign’s slogan and we said ‘err, surely this is a joint event’, the EC again said ‘no, this is fine’. The event was counted as a Government event and so none of the cost was declared by StrongerIn, even though it was attended and spoken at by opposition politicians. It should also be noted that Ryanair did not register as a permitted participant (despite admitting on the record to spending more than the legal threshold of £10,000 in advertising) and generally broke the rules in umpteen ways. The Electoral Commission refused to investigate Ryanair despite their admissions.

This is an example of what I said more than a year ago — that the system was cobbled together by Blair then Cameron for what they thought was their own political advantage and Parliament has not taken the legal framework for our elections seriously, leaving many such gaps, confusions and so on. During the referendum nobody in power cared that EU citizens were voting illegally and posting the evidence on social media — ‘there’s no evidence’, the EC claimed when we presented them with evidence. Those in power passed rules which exempted the Government from the controls which applied to all others during the campaign, with the exception only of ‘purdah’ which applied only in the last four weeks and was routinely broken by the Government (e.g. Cameron’s plainly unlawful but now forgotten speech on the steps of Downing Street two days before the referendum). Another oddity is the loophole in the financing rules that Blair left so that Sinn Fein could raise money in America without having to declare the donors. This rule allowed the DUP to raise and spend money without declaring the source. Again, since the vote the Establishment has raged about this but BLAIR created these rules, not Vote Leave.

For a year, CC and others (such as @jolyon the lawyer) have waged a campaign claiming that our funding of BeLeave and other organisations was illegal. Jolyon has brought a Judicial Review of the EC decision. The Observer and CC are planning a new ‘scoop’ this weekend which seems to be a rehash of everything CC has been saying for 18 months.

1/ They’ve claimed repeatedly that my account above is false and that the EC provided no such guidance to VL. CC has written stories claiming I’d fabricated the whole story. Jolyon claimed the same on on twitter for months. A few days ago at the High Court, VL provided the court with documents proving that what I said was correct and CC and Jolyon have been talking rubbish for a year (document at bottom of blog). Of course, no trace of their errors appear in any of CC’s letters to us and they have made no admission that their accusations were false. They’ve just ignored the fact that their central allegation was false and thrown a load more allegations. What else has the Observer botched? Jolyon now admits the assurance was given by the EC but now is arguing it was unlawful for the EC to do this and is asking the court to declare that in giving it the EC failed in their duty to regulate the referendum. The Divisional Court today found at paragraphs [42]-[43] of its judgment that ‘in asserting that it had never given advice that Vote Leave could lawfully make the donation it did, the Commission was making a statement which, though literally true, was misleading. The court found as a matter of fact that Vote Leave had been given the assurance that donating to other campaigns without coordination was lawful.’ CC and others should revisit their claims but they’ll just keep throwing arguments at the courts hoping something sticks enough to discredit VL and derail Brexit.

2/ In the letters (below) they make a string of claims that are factually wrong, hopelessly confused, or nonsensical — e.g they’ve copied and pasted the wrong bits of emails into emails to different people, rendering some allegations gibberish as they refer to the wrong person. It’s impossible to respond sensibly to a question about ‘your’ criminal act when it is obviously sent to the wrong person (which is one of the reasons why nobody is replying to these letters — upgrade your lawyers, Observer/C4). Some of these claims are supposedly supported by ‘whistleblowers’. The one named, Shahmir, was an occasional volunteer with no access to accounts and data which he claims he had. See below for Stephen Parkinson’s statement on this matter. For example:

  • They claim that BL was registered as a separate company. It was never registered as a separate company.
  • Their whistleblower claims ‘BeLeave was literally set up by Vote Leave’s lawyers. This was, allegedly, cheating on a grand scale.’ False. It was not ‘set up by Vote Leave’s lawyers’. Given there was no separate company, there was nothing for lawyers to ‘set up’. Darren Grimes actually registered himself personally with the EC rather than BeLeave — a mistake which was clearly not advised by any lawyer.
  • They are factually wrong on details like who set up what website and legally wrong on the implications. They claim that the BeLeave website was ‘apparently paid for’ by a member of VL staff. False. It was set up by DG and documents prove it.
  • They claim that VL suggested BeLeave could ‘receive a donation to spend on their own advertisement and projects if they set up their own campaign’, again getting the chronology wrong. BL was set up many months before any donation was a possible issue, and at a time when VL didn’t have nearly enough money to do the things we wanted, let alone make donations to others (we were almost insolvent in spring 2016).
  • A ‘whistleblower’ claims that BeLeave volunteers had ‘no control over expenditure, or authority to spend even very small sums’. False. Darren Grimes himself paid for various things.
  • They falsely claim that people who were actually locked out of VL’s system in 2016 or early 2017 had access to Vote Leave’s files and data in 2018.
  • Wylie makes other claims about conversations he supposedly had. I won’t go into details as I understand there is legal action over this underway. Wylie’s account is strongly disputed.
  • They have accused over a dozen different individuals of the same crimes in different letters — a classic fishing expedition hoping that, in the absence of proper evidence, different people will give contradictory answers and provide ‘evidence’ of a ‘coverup’. E.g They have accused multiple people of arranging the donation to BeLeave and accused multiple people of directing where that money eventually went. They accuse multiple people of still being the administrators for the Vote Leave data drive, when none of them are, and so on.

3/ They claim that members of VL who had left VL employment in 2016, who had moved onto other jobs, and who had been removed from any control of any VL data were responsible for ‘deleting’ emails/documents/records as part of a criminal conspiracy. This is factually wrong. It is part of a pattern of false accusations concerning data. For example, last year CC claimed that VL’s deletion of its database was part of an illegal coverup. This was a huge misunderstanding. In fact, VL had told the ICO that in order to protect the personal data of millions of people we would delete it as soon as possible. The Board authorised staff to do this (I was in the room when it was discussed several times and have notes). VL staff acted ethically, responsibly, and legally in deleting this and other personal data. But the Observer’s hysteria means this was transformed into more supposed ‘evidence’ of a criminal conspiracy. There are other similar examples.

4/ The lawyer Jolyon, who has worked with CC on this story, also claimed that I had accidentally admitted breaking the law (in my report on the campaign when I posted rough spending amounts). On 30 September last year Jolyon tweeted in his usual style: ‘Here is Vote Leave’s Campaign Director *admitting* they spent £3.3 m[illion] more than permitted. Yet still [the EC] wont act.’ After bluster and threats from this charlatan, who was trying to raise money off the back of his claim (interesting QCs are allowed to raise cash off the back of false/incompetent claims without consequence), he then deleted his tweet and apologised. (Salaries don’t count for ‘controlled expenditure’ so, not understanding the law, this QC ‘expert’ had added up the wrong numbers.) Within minutes he was back to throwing new allegations around social media and has carried on.

5/ The EC has now completed two separate investigations into BeLeave and found that we’d done nothing wrong. Jolyon and others brought a JR against the EC in response to which the EC has opened a third investigation which is still underway. Today, the Divisional Court granted permission to Jolyon to bring his claim on one ground, and refused it on a further three. Jolyon argues that referendum expenses and donations are not necessarily mutually exclusive. If this is right, there would be perverse consequences for all campaigners. As the Divisional Court recognised at paragraph [29] of its judgment, ‘if making a donation of the kind described in paragraph 2(1)(c) of Schedule 15 also involves incurring a referendum expense, then only permitted participants could make such donations exceeding £10,000, and only the designation organisation could make such donations exceeding £700,000, without contravening the rules restricting campaign spending.’ In other words, this could have major implications for Remain campaign donors, such as Lord Sainsbury, who never registered as permitted participants but gave hundreds of thousands of pounds in donations. No one at the time thought this was against the law, and the court has not said that it is, only that Jolyon’s claim (in one respect only) meets the low threshold of being ‘arguable’ in a full judicial review.

6/ Throughout this process, the Observer has persecuted the young student, Darren Grimes, who set up BeLeave. They have had no compunction about making his life miserable, undermining his job prospects and so on, in order to try to pressure him into saying something they can use as part of their campaign against VL.

They are also happy to spread completely false stories about Victoria Woodcock, the Operations Director of Vote Leave. Not only was Vics the most important factor in our victory, she was also someone of extraordinary integrity. CC and C4 are trying to destroy her reputation with unfounded claims.

Who is the whistleblower?

Shahmir was a young graduate who volunteered to help VL and BL. He didn’t live in London, so only came into VL’s offices (as many volunteers who helped other campaigns did) occasionally. I have a vague memory I spoke to him in a corridor and may have been introduced. In 2016, Shahmir told VL’s director of compliance, who took detailed contemporaneous notes, that VL behaved legally and properly and Shahmir gave an account of what happened that is completely different to what he is now saying. I’ve no idea why he has decided to change his story, what his relationship with Wylie is, or anything else about the social lives of the whistleblowers and how this affected, if it has, what they are now saying. But journalists should ask him why he has changed his story. And did he tell the Observer/C4 about his previous account and the legal implications?

Until yesterday I had forgotten that Wylie came to pitch me for VL business in January 2016, selling data/digital services with a UK citizen and an ?American/Canadian (can’t remember). I did a search of my records for Wylie and up popped this email.

Screenshot of Wylie email

Screenshot 2018-03-23 12.45.55

So I then searched further and found a Wylie reply to a reply from me:

Screenshot 2018-03-23 12.46.48

I can’t remember much about my thought process other than a vague thought of ‘another charlatan’. Also by this time I already knew that I wasn’t interested in ‘psychographics’.

It is interesting however that Wylie was pitching to me to do ‘social data harvesting’ for VL after he left CA. This is the activity that he now claims is ‘grossly unethical’.

In his pitch doc (vote-leave-campaign-pilot-memo-FINAL PDF) he said that if we hired them ‘Several online panels would be set up to target a cross section of voters… We would try to further increase the sample by accessing the social networks of the panel respondents. We would also harvest online and social data. He claimed that he would use ‘psychological methods … to predict personality and psychological traits of individual voters‘. Has Wylie shown his new media friends this document? When did he decide selling this stuff is evil? Presumably he’s now happy I turned him down.  

A lot of people pitched me similar stuff but I never thought that the people concerned really knew what they were talking about and they never had convincing evidence. As far as I know I’ve never spoken with Wylie apart from this occasion — we certainly did not hire him in any capacity. Nor have I knowingly spoken to anybody from CA. Once I knew CA was involved with Arron, I deliberately tried to avoid any contact of any description with them.

I didn’t know anything about the personal relationships between Wylie/Shahmir/SP until a few days ago but here is Stephen Parkinson’s (SP) statement:

‘I was not introduced to Shahmir Sanni or Darren Grimes by Chris Wylie as he is claiming, but by a mutual friend from university. Shahmir became an occasional volunteer for Vote Leave and other leave campaigns, and we began a personal relationship. We subsequently dated for 18 months, splitting up – I thought amicably – in September 2017. That is the capacity in which I gave Shahmir advice and encouragement, and I can understand if the lines became blurred for him, but I am clear that I did not direct the activities of any separate campaign groups. I had no responsibility for digital campaigning or donations during the referendum, and am confident that Vote Leave acted entirely within the law and strict spending rules at all times.’


[Added the next day… The statement above was originally on this blog yesterday. Then I got requests on behalf of Shahmir to remove it on the grounds that relatives in Pakistan might get killed. Then Shahmir put out his own statement admitting the relationship and attacking Parkinson for ‘outing’ him. So I have restored the statement above and left the below here, so people can see the weird context. 1) Given the nature of Shahmir’s accusations against the Prime Minister’s Political Secretary, no reasonable person would have thought Parkinson could explain all this to the PM and media while hiding the fact of their relationship. 2) Shahmir’s behaviour is not consistent with someone prioritising relatives ‘at serious risk’ in Pakistan, to say the least. 3) Shahmir is unquestionably telling lies about BeLeave — either he was lying to VL’s board member in charge of compliance, who has detailed written notes taken after talking to Shahmir in 2016 about the independence of BeLeave (when Shahmir said it was all ethical and legal), or he is lying now. There’s no third alternative. Given all the other evidence about this, a reasonable person will conclude he’s probably lying now. Maybe it’s connected to his relationship (used in a general sense) with Wylie, maybe not. 4) Wylie literally has described himself as ‘a smear merchant’. Are the media going to report seriously allegations from someone like this? 5) An interesting side issue is that the legal point Shahmir’s lawyers used to try to gag the media yesterday is an ECHR point. It is absurd in principle and this case is a good example of why: person X makes accusations publicly about person Y then gets lawyers to tell Y ‘you can’t answer these accusations in a way that reveals anything about my sex life even if it’s directly relevant to the accusations’. The ECHR creates these legal problems all the time. The media should have had more courage to defend the public interest yesterday and ignored this argument. If I get involved in politics again, then a referendum on the ECHR should be high on the agenda — and bear in mind most people probably think we’re already leaving it because of the 2016 referendum, so imagine how mad they’ll be when they realise we’re still in it.]

[XXX NB. I have removed this statement. I have been sent a letter apparently from lawyers saying people might get killed as a consequence and asking me to remove it for their safety. Despite this being entirely the Observer’s/C4’s fault, I obviously won’t take any risk that people are physically attacked. I will take steps to discover if Bindmans are acting in good faith, whom for, and so on. If I think communications from Bindmans or subsequent coverage by CC/C4 reveal a lack of good faith, and seek to use my removal of this statement to claim, in any way shape or form that I have admitted fault/liability etc about anything, or make dishonest claims about the relationships of specific people because they think they can keep certain details secret using legal threats, then I will put it back up immediately as they will have revealed they were lying about physical dangers for political advantage. It is in your hands, CC/C4 and whistleblowers — I’m cutting you a break you don’t deserve. Journalists please note that I’m unclear what is happening and I’m just assuming this email is genuine given the scale of the issue. Also NB. the legal issue at stake concerns an aspect of the ECHR — and this reminds me that another project we need to get going is a referendum on that, much easier to win than the EU, we’ll win 65-35…]


What will happen next?

The Observer and C4 will publish another load of factually wrong claims about the ‘illegality’ of our donation to BeLeave. They’ll show interviews with ‘whistleblowers’ who were peripheral making invented claims about things they didn’t see. They’ll probably take their inventions about the destruction of documents to the ICO and police and demand that all our computers are seized to ‘stop us destroying evidence of the coverup’, in the hope that a subsequent trawl will expose something and justify their accusations. They’ll publish details of ‘secret social media groups’, and the papers will print salacious details of relationships. And so on.

Then diehard Remain MPs and their media cheerleaders will scream hysterically about how this ‘amazing story’ shows ‘a dangerous network of extremists’ stretching ‘from the Kremlin to Silicon Valley’ has ‘undermined democracy’ and ‘cheated the referendum’. And, most importantly, they’ll argue that this justifies cancelling the last vote and fighting for a rematch. The main objective is to delegitimise VL’s victory and try to cancel the referendum result.

One of the many bad effects of Trump has been the growth of the paranoid mindset in which people latch onto fragments and spin grotesque fabrications. CC’s claims about VL, CA and Brexit are very much in the Trump tradition. This is ironic but as Nietzsche warned, those who fight against dragons must beware lest they become a dragon, and if thou gaze too long into the abyss, the abyss shall gaze into thee…

On Sunday there will be a mini SW1 frenzy but it will pass. In a year, we leave the EU. This nonsense from corners of the media will likely soon not even be a footnote of a footnote in history. And if the current process collapses and MPs cancel the referendum and vote for another one, Vote Leave II will win by more than 52-48 — and there will be profound consequences for all parties and MPs.

To all you whistleblowers, as Vote Leave used to say, ‘We wish you well’.

ENDS

Some documents below. I’d like to publish the C4 document but it’s so full of libellous claims I can’t do it in a way that renders it comprehensible.

LETTER FROM CC TO ME THIS WEEK (multiple copies of this have been sent with wrong sentences pasted from this master version)

Dear Dom,

The Guardian & Observer news team is considering publishing articles that will report that the Vote Leave campaign established the BeLeave campaign as an independent entity with the aim of using it to channel extra spending on the Brexit referendum.

We understand that this was illegal under UK electoral law as BeLeave had no control over the money nominally donated to them, and because the two ‘campaigns’ had been working together before BeLeave was formally established as an allegedly independent entity, and key individuals continued to work together, coordinating their plans even after the separation.

We also understand that when an investigation began into the donation from Vote Leave to BeLeave, key individuals attempted to destroy what might be considered to be evidence of coordination between Vote Leave and BeLeave.

We have the following understanding of the underlying factual situation, which we would propose to reflect in any article that may be published.

1. Members of BeLeave worked out of Vote Leave offices and with their guidance and support before they were an independent campaign. They continued to work out of the Vote Leave offices after they formally became independent.

2. Many of their activities were coordinated by or discussed with Vote Leave. This included messaging and documents stored on the shared ‘BeLeave’ drive.

3. Vote Leave set up this drive to co-ordinate BeLeave’s activities with Vote Leave. The settings of the BeLeave drive sent automatic notifications of changes to members of VoteLeave, but not to BeLeave staff.

4. Vote Leave members were part of a closed BeLeave Facebook group.

5. The staff of BeLeave were volunteers, but all expenses were apparently paid for by Vote Leave.

6. BeLeave website was coordinated and apparently paid for by XXX.

7. Vote Leave directors suggested to BeLeave volunteers they would receive a donation to spend on their own advertisements and projects if they set up their own campaign. We have been told you were the architect of this plan.

8. We understand that you arranged a donation of £625,000 from Vote Leave (where you worked as a campaign director) and a further £50,000 from XXX to the group BeLeave.

9. A volunteer has described in detail the relationship with Vote Leave. They said: “BeLeave was literally set up by Vote Leave’s lawyers. This was cheating on a grand scale.”   

10. Vote Leave lawyers drew up the legal documents that formally made BeLeave a separate company and campaign. This was at your direction.

11. The Vote Leave legal director told members of BeLeave to set up a bank account. However no money was ever deposited in it and that they never had even nominal control of money. Again, this was at your direction.

12. The money never went to BeLeave’s account. Instead it was passed straight to a Canadian company called Aggregate IQ (AIQ) for spending purposes decided by Vote Leave. This was at your direction.

13. The  volunteer claims BeLeave had no control of expenditure, or authority to spend even very small sums. Ultimately, you, as campaign director for Vote Leave directed this.

14. The BeLeave team were not warned of potential implications or told to take legal advice. This was at your direction.

15. The legal documents and formalities establishing the separate campaign were handled by the Vote Leave head of compliance.

16. AIQ directors and employees were in the same building as Vote Leave and BeLeave in London. In some cases at desks a few metres away from each other. This was at your direction.

17. When the connection between the two campaigns came under scrutiny,  a director of Vote Leave wrote the press response for BeLeave.

18. On March 17 2018 – almost two weeks after the Information Commissioner’s Office announced an inquiry into how personal data was used during the referendum campaign and shortly after the Electoral Commission announced irt was looking again into the donation – references to you were deleted from files on the shared Vote Leave and BeLeave drive by [XXX I have deleted name as this is factually wrong and libellous. The date 2018 is presumably a typo].

19. DUP, Veterans for Britain also used the services of AIQ. It is understood you directed them to do so.

If you have any comments on any of the above, please let us know. In addition we’d like to ask you the following questions:

20.  References to not just yourself but also XXX and XXX [I’ve deleted others names as this is wrong and libellous] were deleted from the shared drive. Did you have prior knowledge of this? When did you learn about it? Did you direct XXX to do so?

21. Who introduced Vote Leave to Aggregate IQ?

22. What due diligence did Vote Leave do prior to the selection of AIQ.

23. What were the deciding factors behind Vote Leaves choice of AIQ?  

24. You said previously that XXX did your data modelling, but returns show only invoices for “polling analysis services” and “advertising”. No split spending is declared for any expenditure before the regulated period. Further, directors of Vote Leave made reference to having signed up “a group of West Coast American academics to do data”. Can you explain further?

25. Do you have any further comment to make on your claim previously that you received written notice from the Electoral Commission giving you permission to make this donation? [Ignoring the fact that what I said was proved right in Court.]

If you dispute any of the information or above or have any points to make about these and other matters, please let me know.

We would be grateful if you could respond by 4pm on 21 March.

Carole Cadwalladr

EMAIL FROM ELECTORAL COMMISSION TO VOTE LEAVE REVEALED IN COURT, 1 OF THE DOCS DISPROVING CC/JOLYON ACCUSATIONS

From: XXX​ <XXX@electoralcommission.org.uk>

Date: Fri, May 20, 2016 at 3:40 PM

Subject: RE: Some questions in relation to campaign expenditure

To: XXX [VOTE LEAVE]

Cc: XXX

Dear XXX,

Thanks for your email and apologies for the delay in our response.

Before addressing your specific queries, I thought it would be helpful to set out the Commission’s general position on apportioning overheads in relation to referendum spending.

Campaigners are only required to report a relevant proportion of overheads that are incurred in respect of the list of referendum campaign activities set out in in our guidance (p. 6) and which are summarised from the list of regulated matters in schedule 13 of PPERA. With regards to general overheads and running costs, we consider that only an appropriate proportion of the rental costs of an office (to the extent that the space is being used to plan, coordinate or carry out referendum activities), electricity and telephone/internet costs are sufficiently connected with spending on these listed referendum activities to count against the spending limit and require reporting.

When considering your overheads and running costs, you should make a reasonable assessment based on the facts in each particular case as to whether they have been incurred in respect of these referendum activities. It is appropriate for campaigners to split the costs of overheads where they have been used both before and during the regulated period, or where the overhead covers both referendum and non-referendum specific activities. You are not required to report the costs of overheads that are incidental to referendum activities.

Turning to your specific questions:

  1. As described above, the costs of premises and equipment – where they have been incurred in respect of regulated referendum campaign activities – will constitute referendum spending. You should make an honest assessment of the amount you have spent based on the facts. Your assessment should consider the extent to which the premises and equipment have been used in respect of referendum campaign activities during the regulated period. For audit purposes, we recommend that you keep a record of how you made your Assessment.
  2. If you are supplying material to other campaigners without having a co-ordinated plan or agreement then the material is likely to be a donation from you to the other campaigner. If the donation is over £500 it will reportable by the other campaigner. You would not need to report the cost of the material in your spending return unless you use the material yourself.
  3. Only costs that are incurred in respect of referendum activities will count against your spending limit and require reporting after the referendum. We agree that in most cases the costs you refer to as being related to ‘governance’ (such as HR support for your staff, accountancy fees and legal advice in respect of compliance with PPERA) will not constitute referendum expenditure as they are not being incurred in respect of regulated referendum activities.
  4. If the events are intended to, or are otherwise in connection with, promoting or bringing about a particular outcome in the referendum then the full cost of the event would be reportable.
  5. When you are uploading invoices and receipts to PEF Online you can only upload PDFs.

I hope the above is helpful to you. If you do have any further questions, please let me know.

Kind regards,

XXX

Guidance Adviser

Party and Election Finance

The Electoral Commission

3 Bunhill Row

London EC1Y 8YZ

On the referendum #23, a year after victory: ‘a change of perspective is worth 80 IQ points’ & ‘how to capture the heavens’

‘Just like all British governments, they will act more or less in a hand to mouth way on the spur of the moment, but they will not think out and adopt a steady policy.’ Earl Cromer, 1896.

Fascinating that the same problems recur time after time, in almost every program, and that the management of the program, whether it happened to be government or industry, continues to avoid reality.’ George Mueller, pioneer of systems management and head of the Apollo programme to put man on the moon.

Traditional cultures, those that all humans lived in until quite recently and which still survive in pockets, don’t realise that they are living inside a particular perspective. They think that what they see is ‘reality’. It is, obviously, not their fault. It is not because they are stupid. It is a historical accident that they did/do not have access to mental models that help more accurate thinking about reality.

Westminster and the other political cultures dotted around the world are similar to these traditional cultures. They think they they are living in ‘reality’. The MPs and pundits get up, read each other, tweet at each other, give speeches, send press releases, have dinner, attack, fuck or fight each other, do the same tomorrow and think ‘this is reality’. Like traditional cultures they are wrong. They are living inside a particular perspective that enormously distorts reality. 

They are trapped in thinking about today and their careers. They are trapped in thinking about incremental improvements. Almost nobody has ever been part of a high performance team responsible for a complex project. The speciality is a hot take to explain post facto what one cannot predict. They mostly don’t know what they don’t know. They don’t understand the decentralised information processing that allows markets to enable complex coordination. They don’t understand how scientific research works and they don’t value it. Their daily activity is massively constrained by the party and state bureaucracies that incentivise behaviour very different to what humanity needs to create long-term value. As Michael Nielsen (author of Reinventing Science) writes:

‘[M]uch of our intellectual elite who think they have “the solutions” have actually cut themselves off from understanding the basis for much of the most important human progress.’

Unlike traditional cultures, our modern political cultures don’t have the excuse of our hunter-gatherer ancestors. We could do better. But it is very very hard to escape the core imperatives that make big bureaucracies — public companies as well as state bureaucracies — so bad at learning. Warren Buffet explained decades ago how institutions actively fight against learning and fight to stay in a closed and vicious feedback loop:

‘My most surprising discovery: the overwhelming importance in business of an unseen force that we might call “the institutional imperative”. In business school, I was given no hint of the imperative’s existence and I did not intuitively understand it when I entered the business world. I thought then that decent, intelligence, and experienced managers would automatically make rational business decisions. But I learned the hard way that isn’t so. Instead rationality frequently wilts when the institutional imperative comes into play.

‘For example, 1) As if governed by Newton’s First Law, any institution will resist any change in its current direction. 2) … Corporate projects will materialise to soak up available funds. 3) Any business craving of the leader, however foolish, will quickly be supported by … his troops. 4) The behaviour of peer companies … will be mindlessly imitated.’

Almost nobody really learns from the world’s most successful investor about investing and how to run a successful business with good corporate governance. (People read what he writes but almost no investors choose to operate long-term like him, I think it is still true that not a single public company has copied his innovations with corporate governance like ‘no pay for company directors’, and governments have consistently rejected his and Munger’s advice about controlling the looting of public companies by management.) Almost nobody really learns how to do things better from the experience of dealing with this ‘institutional imperative’. We fail over and over again in the same way, trusting in institutions that are programmed to fail.

It is very very hard for humans to lift our eyes from today and to go out into the future and think about what could be done to bring the future back to the present. Like ants crawling around on the leaf, we political people only know our leaf.

Science has shown us a different way. Newton looked up from his leaf, looked far away from today, and created a new perspective — a new model of reality. It took an extreme genius to discover something like calculus but once discovered billions of people who are far from being geniuses can use this new perspective. Science advances by turning new ideas into standard ideas so each generation builds on the last.

Politics does the equivalent of constantly trying to reinvent children’s arithmetic and botching it. It does not build reliable foundations of knowledge. Archimedes is no longer cutting edge. Thucydides and Sun Tzu are still cutting edge. Even though Tetlock and others have shown how to start making similar progress with politics, our political cultures fiercely resist learning and fight ferociously to stay in closed and failing feedback loops.

In many ways our political culture has regressed as it has become more and more audio-visual and less and less literate. (Only 31% of US college graduates can read at a basic level. I’d guess it’s similar here. See end.) I’ve experimented with the way Jeff Bezos runs meetings at Amazon: i.e start the meeting with giving people a 5-10 page memo to read. Impossible in Westminster, nobody will sit and read like that! Officials have tried and failed for a year to get senior ministers to engage with complex written material about the EU negotiations. TV news dominates politics and is extremely low-bandwidth: it contains a few hundred words and rarely uses graphics properly. Evan Davis illustrates a comment about ‘going down the plughole’ with a picture of water down a plughole and Nick Robinson illustrates a comment about ‘the economy taking off’ with a picture of a plane taking off. The constant flow of bullshit from the likes of Robert Peston and Jon Snow dominates the medium because competition has been impossible until recently. BUT, although technology is making these charlatans less relevant (good) it also creates new problems and will not necessarily improve the culture.

Watching political news makes you dumber — switch it off and read books! If you work in it, either QUIT or go on holiday and come back determined to subvert it. How? Start with a previous blog which has some ideas, like tracking properly which people have a record of getting things right and wrong. Every editor I’ve suggested this to winces and says ‘impossible’. Insiders fear accountability and competition.

Today, the anniversary of the referendum, is a good day to forget the babble in the bubble and think about lessons from another project that changed the world, the famous ARPA/PARC team of the 1960s and 1970s.

*

ARPA/PARC and ‘capturing the heavens’: The best way to predict the future is to invent it

The panic over Sputnik brought many good things such as a huge increase in science funding. America also created the Advanced Research Projects Agency (ARPA, which later added ‘Defense’ and became DARPA). Its job was to fund high risk / high payoff technology development. In the 1960s and 1970s, a combination of unusual people and unusually wise funding from ARPA created a community that in turn invented the internet, or ‘the intergalactic network’ as Licklider originally called it, and the personal computer. One of the elements of this community was PARC, a research centre working for Xerox. As Bill Gates said, he and Steve Jobs essentially broke into PARC, stole their ideas, and created Microsoft and Apple.

The ARPA/PARC project has created over 35 TRILLION DOLLARS of value for society and counting.

The whole story is fascinating in many ways. I won’t go into the technological aspects. I just want to say something about the process.

What does a process that produces ideas that change the world look like?

One of the central figures was Alan Kay. One of the most interesting things about the project is that not only has almost nobody tried to repeat this sort of research but the business world has even gone out of its way to spread mis-information about it because it was seen as so threatening to business-as-usual.

I will sketch a few lessons from one of Kay’s pieces but I urge you to read the whole thing.

‘This is what I call “The power of the context” or “Point of view is worth 80 IQ points”. Science and engineering themselves are famous examples, but there are even more striking processes within these large disciplines. One of the greatest works of art from that fruitful period of ARPA/PARC research in the 60s and 70s was the almost invisible context and community that catalysed so many researchers to be incredibly better dreamers and thinkers. That it was a great work of art is confirmed by the world-changing results that appeared so swiftly, and almost easily. That it was almost invisible, in spite of its tremendous success, is revealed by the disheartening fact today that, as far as I’m aware, no governments and no companies do edge-of-the-art research using these principles.’

‘[W]hen I think of ARPA/PARC, I think first of good will, even before brilliant people… Good will and great interest in graduate students as “world-class researchers who didn’t have PhDs yet” was the general rule across the ARPA community.

‘[I]t is no exaggeration to say that ARPA/PARC had “visions rather than goals” and “funded people, not projects”. The vision was “interactive computing as a complementary intellectual partner for people pervasively networked world-wide”. By not trying to derive specific goals from this at the funding side, ARPA/PARC was able to fund rather different and sometimes opposing points of view.

‘The pursuit of Art always sets off plans and goals, but plans and goals don’t always give rise to Art. If “visions not goals” opens the heavens, it is important to find artistic people to conceive the projects.

‘Thus the “people not projects” principle was the other cornerstone of ARPA/PARC’s success. Because of the normal distribution of talents and drive in the world, a depressingly large percentage of organizational processes have been designed to deal with people of moderate ability, motivation, and trust. We can easily see this in most walks of life today, but also astoundingly in corporate, university, and government research. ARPA/PARC had two main thresholds: self-motivation and ability. They cultivated people who “had to do, paid or not” and “whose doings were likely to be highly interesting and important”. Thus conventional oversight was not only not needed, but was not really possible. “Peer review” wasn’t easily done even with actual peers. The situation was “out of control”, yet extremely productive and not at all anarchic.

‘”Out of control” because artists have to do what they have to do. “Extremely productive” because a great vision acts like a magnetic field from the future that aligns all the little iron particle artists to point to “North” without having to see it. They then make their own paths to the future. Xerox often was shocked at the PARC process and declared it out of control, but they didn’t understand that the context was so powerful and compelling and the good will so abundant, that the artists worked happily at their version of the vision. The results were an enormous collection of breakthroughs.

‘Our game is more like art and sports than accounting, in that high percentages of failure are quite OK as long as enough larger processes succeed… [I]n most processes today — and sadly in most important areas of technology research — the administrators seem to prefer to be completely in control of mediocre processes to being “out of control” with superproductive processes. They are trying to “avoid failure” rather than trying to “capture the heavens”.

‘All of these principles came together a little over 30 years ago to eventually give rise to 1500 Altos, Ethernetworked to: each other, Laserprinters, file servers and the ARPAnet, distributed to many kinds of end-users to be heavily used in real situations. This anticipated the commercial availability of this genre by 10-15 years. The best way to predict the future is to invent it.

‘[W]e should realize that many of the most important ARPA/PARC ideas haven’t yet been adopted by the mainstream. For example, it is amazing to me that most of Doug Engelbart’s big ideas about “augmenting the collective intelligence of groups working together” have still not taken hold in commercial systems. What looked like a real revolution twice for end-users, first with spreadsheets and then with Hypercard, didn’t evolve into what will be commonplace 25 years from now, even though it could have. Most things done by most people today are still “automating paper, records and film” rather than “simulating the future”. More discouraging is that most computing is still aimed at adults in business, and that aimed at nonbusiness and children is mainly for entertainment and apes the worst of television. We see almost no use in education of what is great and unique about computer modeling and computer thinking. These are not technological problems but a lack of perspective. Must we hope that the open-source software movements will put things right?

‘The ARPA/PARC history shows that a combination of vision, a modest amount of funding, with a felicitous context and process can almost magically give rise to new technologies that not only amplify civilization, but also produce tremendous wealth for the society. Isn’t it time to do this again by Reason, even with no Cold War to use as an excuse? How about helping children of the world grow up to think much better than most adults do today? This would truly create “The Power of the Context”.’

Note how this story runs contrary to how free market think tanks and pundits describe technological development. The impetus for most of this development came from government funding, not markets.

Also note that every attempt since the 1950s to copy ARPA and JASON (the semi-classified group that partly gave ARPA its direction) in the UK has been blocked by Whitehall. The latest attempt was in 2014 when the Cabinet Office swatted aside the idea. Hilariously its argument was ‘DARPA has had a lot of failures’ thus demonstrating extreme ignorance about the basic idea — the whole point is you must have failures and if you don’t have lots of failures then you are failing!

People later claimed that while PARC may have changed the world it never made any money for XEROX. This is ‘absolute bullshit’ (Kay). It made billions from the laser printer alone and overall Xerox made 250 times what they invested in PARC before they went bust. In 1983 they fired Bob Taylor, the manager of PARC and the guy who made it all happen.

‘They hated [Taylor] for the very reason that most companies hate people who are doing something different, because it makes middle and upper management extremely uncomfortable. The last thing they want to do is make trillions, they want to make a few millions in a comfortable way’ (Kay).

Someone finally listened to Kay recently. ‘YC Research’, the research arm of the world’s most successful (by far) technology incubator, is starting to fund people in this way. I am not aware of any similar UK projects though I know that a small network of people are thinking again about how something like this could be done here. If you can help them, take a risk and help them! Someone talk to science minister Jo Johnson but be prepared for the Treasury’s usual ignorant bullshit — ‘what are we buying for our money, and how can we put in place appropriate oversight and compliance?’ they will say!

Why is this relevant to the referendum?

As we ponder the future of the UK-EU relationship shaped amid the farce of modern Whitehall, we should think hard about the ARPA/PARC example: how a small group of people can make a huge breakthrough with little money but the right structure, the right ways of thinking, and the right motives.

Those of us outside the political system thinking ‘we know we can do so much better than this but HOW can we break through the bullshit?’ need to change our perspective and gain 80 IQ points.

This real picture is a metaphor for the political culture: ad hoc solutions that are either bad or don’t scale.

Screenshot 2017-06-14 16.58.14.png

ARPA said ‘Let’s get rid of all the wires’. How do we ‘get rid of all the wires’ and build something different that breaks open the closed and failing political cultures? Winning the referendum was just one step that helps clear away dead wood but we now need to build new things.

The ARPA vision that aligned the artists ‘like little iron filings’ was:

‘Computers are destined to become interactive intellectual amplifiers for everyone in the world universally networked worldwide’ (Licklider).

We need a motivating vision aimed not at tomorrow but at changing the basic wiring of  the whole system, a vision that can align ‘the little iron filings’, and then start building for the long-term.

I will go into what I think this vision could be and how to do it another day. I think it is possible to create something new that could scale very fast and enable us to do politics and government extremely differently, as different to today as the internet and PC were to the post-war mainframes. This would enable us to build huge long-term value for humanity in a relatively short time (less than 20 years). To create it we need a process as well suited to the goal as the ARPA/PARC project was and incorporating many of its principles.

We must try to escape the current system with its periodic meltdowns and international crises. These crises move 500-1,000 times faster than that of summer 1914. Our destructive potential is at least a million-fold greater than it was in 1914. Yet we have essentially the same hierarchical command-and-control decision-making systems in place now that could not even cope with 1914 technology and pace. We have dodged nuclear wars by fluke because individuals made snap judgements in minutes. Nobody who reads the history of these episodes can think that this is viable long-term, and we will soon have another wave of innovation to worry about with autonomous robots and genetic engineering. Technology gives us no option but to try to overcome evolved instincts like destroying out-group competitors.

In a previous blog I outlined how the ‘systems management’ approach used to put man on the moon provides principles for a new approach.

*

Ironically, one of the very few people in politics who understood the sort of thinking needed was … Jean Monnet, the architect of the EEC/EU! Monnet understood how to step back from today and build institutions. He worked operationally to prepare the future:

‘If there was stiff competition round the centres of power, there was practically none in the area where I wanted to work – preparing the future.’

Monnet was one of the few people in modern politics who really deserve the label ‘genius’. The story of how he wangled the creation of his institutions through the daily chaos of post-war politics is a lesson to anybody who wants to get things done.

But the institutions he created are in many ways the opposite of what the world needs. Their core operating principle is perpetual centralisation of power in the hands of an all powerful bureaucracy (Commission) and Court (ECJ). Nothing that works well in the world works like this!

Thanks to the prominence of Farage the dominant story among educated people is that those who got us out of the EU want to take us back to the pre-1914 era of hostile competing nation states. Nothing could be further from the truth. The key people in Vote Leave wanted and want not just what is best for Britain but what is best for all humanity. We want more international cooperation, not less. The problem with the EU is not that it is about international cooperation but that it is so bad at it and actually undermines it.

Britain leaving forces those with power to ask: how can all European countries trade freely and cooperate without subscribing to Monnet’s bureaucratic centralism? This will help Europe in the long-term. To those who favour this bureaucratic centralism and uniformity, reflect on the different trajectories of Europe and China post-Renaissance. In Europe, regulatory competition (so Columbus could chase funding in Spain after rejection in Portugal) brought immense gains. In China, centrally directed uniformity led to centuries of stagnation. America’s model of competitive federalism created by the founding fathers has been a far more effective engine of civilisation, growth, and new knowledge than the Monnet-Delors Single Market model.

If Britain were to focus on science and education with huge resources and a new-found seriousness, then this regulatory diversity would help not just Britain but all Europe and the global science community. We could make Britain the best place in the world to be for those who can invent the future. Like Alan Kay and his colleagues, we could create whole new industries. We could call Jeff Bezos and say, ‘Ok Jeff, you want a permanent international manned moon base, let’s talk about who does what, but not with that old rocket technology.’ No country on earth funds science as well as we already know how it could be done — that is something for Britain to do that would create real long-term value for humanity, instead of the ‘punching above our weight’ and ‘special relationship’ bullshit that passes for strategy in London. How we change our domestic institutions is within our power and will have much much greater influence on our long-term future than whatever deal is botched together with Brussels. We have the resources. But can we break the system open? If we don’t then we’re likely to go down the path we were already going down inside the EU, like the deluded Norma Desmond in Sunset Boulevard claiming ‘I am big, it’s the pictures that got small.’

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Vote Leave and ‘good will’

Although Vote Leave was enmeshed in a sort of collective lunacy we managed, barely, to fend it off from the inner working of the campaign. Much of my job (sadly) was just trying to maintain a cordon around the core team so they could deliver the campaign with as little disruption as possible. We managed this because among the core people we had great good will. The stories of the campaign focus on the lunacy, but the people who really made it work remember the goodwill.

A year ago tonight I was sitting alone in a room thinking ‘we’ve won, now…’ when the walls started rumbling. At first I couldn’t make it out then, as Tim Shipman tells the story in his definitive book on the campaign, I heard ‘Dom, Dom, DOM’ — the team had declared victory. I went next door…

Thanks to everybody who sacrificed something. As I said that night and as I said in my long blog on the campaign, I’ve been given credit I don’t deserve and which rightly belongs to others — Cleo Watson, Richard ‘Ricardo’ Howell, Brother Starkie, Oliver Lewis, Lord Suart et al. Now, let’s think about what should come next…

 

Watch Alan Kay explain how to invent the future HERE and HERE.


Ps. Kay also points out that the real computer revolution won’t happen until people fulfil the original vision of enabling children to use this powerful way of thinking:

‘The real printing revolution was a qualitative change in thought and argument that lagged the hardware inventions by almost two centuries. The special quality of computers is their ability to rapidly simulate arbitrary descriptions, and the real computer revolution won’t happen until children can learn to read, write, argue and think in this powerful new way. We should all try to make this happen much sooner than 200 or even 20 more years!’

Almost nobody in education policy is aware of the educational context for the ARPA/PARC project which also speaks volumes about the abysmal field of ‘education research/policy’.

* Re the US literacy statistic, cf. A First Look at the Literacy of America’s Adults in the 21st Century, National Assessment of Adult Literacy, U.S. Dept of Education, NCES 2006.

 

 

 

Unrecognised simplicities of effective action #2(b): the Apollo programme, the Tory train wreck, and advice to spads starting work today

A few months ago I put a paper on my blog: The unrecognised simplicities of effective action #2: ‘Systems engineering’ and ‘systems management’ — ideas from the Apollo programme for a ‘systems politics’.

It examined the history of the classified programme to build ICBMs and the way in which George Mueller turned the failing NASA bureaucracy into an organisation that could put man on the moon. The heart of the paper is about the principles behind effective management of complex projects. These principles are relevant to Government, politics, and campaigns.

The paper is long as I thought it worthwhile to tell some of the detailed story. At the suggestion of various spads, ministers, hacks and so on I have cut and pasted the conclusion below particularly for those starting new jobs today. This is in the form of a crude checklist that compares a) the principles of Mueller’s systems management and b) how Whitehall actually works.

You will see that Whitehall operates on exactly opposite principles to those organisations where high performance creates real value. You will also soon see that you are now in a culture in which almost nobody is aware of this and anybody who suggests it sinks their career. In your new department, failure is so normal it is not defined as ‘failure’. Officials lose millions and get a gong. There is little spirit of public service or culture of responsibility. The most political people are promoted and the most competent people, like Victoria Woodcock, leave. The very worst officials are often put in charge of training the next generation. For most powerful officials, the most important thing is preserving the system, closed and impregnable. Unlike for ministers, the TV blaring with DISASTER is of no concern – provided it is the Minister in the firing line not them – and the responsible officials will happily amble to the tube at 4pm while political careers hang in the balance and you draft statements taking ‘full responsibility’ for things you knew nothing about and would have been prohibited from fixing if you had.

For all those spads in particular who are moving into new jobs, it is worth reflecting on the deep principles that actually determine why things work and do not work. Nobody will explain these to you or talk to you about them. Sadly, few MPs these days understand the crucial role of management – they tend to think of it like science as a rather lowly skill beneath their Olympian status – so you will also probably have to cope with the fact that your minister is more interested in keeping one step ahead of Simon Walters (they won’t). The thing that officials will try hardest to do is convey to you that you have no role in personnel decisions and/or management.

If you accept that, you are accepting at the start that you will achieve very little. The reason why Gove’s team got much more done than ANY insider thought was possible – including Cameron and the Perm Sec – was because we bent or broke the rules and focused very hard on a) replacing rubbish officials and bringing in people from outside and b) project management.

You cannot reform the way the civil service works. Only a PM can do that and there is no chance of May doing it – she blew her chance and her reward is to be pushed around by Heywood and Sue Gray until her colleagues pull the plug and start the leadership campaign. You should assume that won’t be long so focus, manage a few priorities with daily and weekly timetables, and use embarrassing errors to negotiate secret deals with the Perm Sec to move rubbish officials out of your priority areas – trust me, Perm Secs understand this game and will do deals with alacrity to make their lives easier. Officials are less politically biased than you probably have been told – they are much more concerned with avoiding hard work and protecting the system than in resisting specific policies, and you can exploit this. Make alliances with the good officials who still have hope and have not been broken by the system, there are surprisingly many who will pop up if they think you actually care about the public rather than party interests.

You will also notice that fundamental issues of organisational culture described below explain the shambles of CCHQ over the past 8 weeks: the lack of information sharing, the lack of orientation, the culture of blaming juniors for the failures of overpaid senior people, bottlenecks preventing fast decisions, endless small errors compounding into a broken organisation because nobody knows who is responsible for what and so on. Every failing organisation has the same stories, people find it very hard to learn from the most successful organisations and people.

To the extent Vote Leave was successful, it was partly because I consciously tried to copy Mueller in various ways, though given my own severe limitations this was patchy. If you ever get the chance to exercise leadership, try to copy people like Mueller who tried to make the world better and build an organisation that people were proud to serve.

Finally, consider the basic condition that allows Westminster and Whitehall to be so rubbish and get away with it: they are not just monopolies, they set the rules of the game, and both the civil service and the parties make it almost impossible for outsiders to influence anything. But a) the combination of the 2008 crisis, Brexit, and extreme unhappiness about politics as usual provides a potentially powerful fuel for an insurgency, and b) technology provides opportunities for startups to catch public imagination and scale extremely fast. I’ve always been sceptical of the idea of a new UK party of any sort but I increasingly think there is a chance that a handful of entrepreneurs could start a sort of anti-party to exploit the broken system and create something which confounds the right/centre/left broken mental model that dominates SW1 and which combines Mueller’s principles with Silicon Valley technology.

If the Tory Party does not make some profound changes fast, then it faces being blamed for the disintegration of Brexit talks and the election of Corbyn after which it is possible that, rather than attempting a coup to take them over, entrepreneurs may decide it is more rational to build something that ploughs them into the earth next to Corbyn.

I said since last summer that if the Tory Party tried to carry on with Brexit and government using the same broken Downing Street operation, which spends its time on crap spin and has almost no capacity for serious management, and the same broken political operation, dominated by people who have failed to persuade the country convincingly for many years, then they would blow up. They failed to change Downing Street and they ran yet another fundamentally misconceived campaign that blew massive structural advantages. Kaboom.

[[Within minutes of publishing this blog I got the following email from someone I haven’t met but who I know was inside CCHQ with the para above highlighted and these words: ‘This is exactly my depressing experience – shit show run by people who don’t care about anything other than their jobs.’]]

MPs of all parties need to realise that the referendum makes it impossible to carry on with your usual bullshit – it forces changes upon you even though you want to carry on with the old games. The first set of MPs that realise this and change their operating principles will quickly overwhelm the others: there is a huge first-mover advantage especially in a field characterised by institutional incompetence that is susceptible to external shocks (terror, financial collapse) and which is opening up to technological disruption. And you will only get on top of Brexit if you realise that leaving the EU is a systems problem requiring a systems response and this means a radically different organisation of the UK negotiating team. The challenge is not far short of the political equivalent of the Apollo program and it needs similarly imaginative management.

For those who do want to do something better, the below will be useful. I encourage you to read the whole history HERE but for those rushing through a sandwich on Day 1 this summary will help you think of the big picture. If you want a detailed tutorial on how the civil service works then read The Hollow Men HERE

[Added later… It is also very instructive that despite the triumph of Mueller’s methods, NASA itself abandoned them after he left and has never recovered. Even spectacular success on a world-changing project is not enough to beat bureaucratic inertia. Also, the US Government passed so many laws that Mueller himself said in later life it would be impossible to repeat Apollo without making it a classified ‘black’ project to evade the regulations. JSOC, US classified special forces, has to run a lot of its standard procurement via ‘black’ procurement processes just to get anything done. The abysmal procurement rules imposed under the Single Market are just one of the good reasons for us to get out of the SM as well as the EU. I had to deal with them a lot in the DfE and had to find ways to cheat them a lot to get things done faster and cheaper. They add billions to costs every year and Whitehall refused for years even to assess this huge area to avoid undermining support for the EU.]

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Excerpt from The unrecognised simplicities of effective action #2 (p.28ff) 

Core lessons [of Mueller’s systems management] for politics?

Finally, I will summarise some of the core lessons of systems management that could be applied to re-engineering political institutions such as Downing Street.  Mueller’s approach meant an extreme focus on some core principles:

  • Organisation-wide orientation. Everybody in a large organisation must understand as much about the goals and plans as possible. Whitehall now works on opposite principles: I doubt a single department has proper orientation across most of the organisation (few will have it even across the top 10 people), never mind a whole government. This is partly because most ministers fail at the first hurdle — developing coherent goals — so effective orientation is inherently impossible.
  • Integration. There must be an overall approach in which the most important elements fit together, including in policy, management, and communications. Failures in complex projects, from renovating your house to designing a new welfare system, often occur at interfaces between parts. Whitehall now works on opposite principles: for example, Cameron and Osborne approached important policy on immigration/welfare in the opposite way by 1) promising to reduce immigration to less than 100,000 while simultaneously 2) having no legal tools to do this (and even worse promising to change this then failing in the EU renegotiation) and 3) having welfare policies that incentivised more immigration then 4) announcing a new living wage thus increasing incentives further for immigration. They emphasised each element as part of short-term political games and got themselves into a long-term inescapable mess.
  • Extreme transparency and communication, horizontally as well as hierarchically. More, richer, deeper communication so that ‘all of us understand what was going on throughout the program… [C]ommunications on a level that is free and easy and not constrained by the fact that you’re the boss… [This was] the secret of the success of the program, because so many programs fail because everybody doesn’t know what it is they are supposed to do’ (Mueller). Break information and management silos — a denser network of information and commands is necessary and much of it must be decentralised and distributed between different teams, but with leadership having fast and clear information flow at the centre so problems are seen and tackled fast (a virtuous circle). There is very little that needs to be kept secret in government and different processes can easily be developed for that very small number of things. As McChrystal says of special forces operations generally the advantages of communication hugely outweigh the dangers of leaks. Whitehall now works on opposite principles: it keeps information secret that does not need to be secret in order to hide its own internal processes from scrutiny, thus adding to its own management failures and distrust (a vicious circle).
  • ‘Configuration management’. There must be a process whereby huge efforts go into the initial design of a complex system then there is a process whereby changes are made in a disciplined way such that a) interdependencies are tested where possible by relevant people before a change is agreed and b) then everybody relevant knows about the change. This ties together design, engineering, management, scheduling, cost, contracts, and allows the coordination of interdisciplinary teams. Test, learn, communicate results, change where needed, communicate… Whitehall now works on opposite principles: it does not put enough effort into the initial design then makes haphazard changes then fails to communicate changes effectively.
  • Physical and information structures should reinforce open communication. From Mueller’s NASA to JSOC, organisations that have coped well with complexity have built novel control centres to reinforce extreme communication. Spend money and time on new technologies and processes to help spread orientation and learning through the organisation. Whitehall now works on opposite principles: e.g. its antiquated committee structure and ‘red box’ system are ludicrously inefficient regarding management but are kept because they give officials huge control over ministers.
  • Long-term budgets. Long-term budgets save money. Whitehall now works on opposite principles: normal government budget processes do not value speed and savings from doing things fast. They are focused on what Parliament thinks this year. This makes it very hard to plan wisely and wastes money in the long-term (see below).
  • You need a complex mix of centralisation and decentralisation. While overall vision, goals, and strategy usually comes from the top, it is vital that extreme decentralisation dominates operationally so that decisions are fast and unbureaucratic. Information must be shared centrally and horizontally across the organisation — it is not either/or. Big complex projects must empower people throughout the network and cannot rely on issuing orders through a hierarchy. Whitehall now works on opposite principles: it is a centralising ratchet. E.g. Budgets and spending reviews are the exact opposite of Mueller’s approach. 1) They are short-term with almost no long-term elements. 2) They do not balance off priorities in any serious way. 3) They involve totally fake numbers — every department lies to the Treasury and provides fake numbers. Treasury officials dig into these. There are rounds of these games. Officials never stop lying. To maintain the charade the Chancellor never says to the SoS ‘stop your officials lying to us’ — candour would break the system. 4) The Treasury does not have the expertise to evaluate most of what they are looking at. The idea it is a department staffed by brilliant whiz kids is a joke. I saw DfE officials with very modest abilities routinely cheat the Treasury.
  • Extreme focus on errors. Schriever had ‘Black Saturdays’ and Mueller had similar meetings focused not on ‘reporting progress’ but making clear the problems. Simple as it sounds this is very unusual. Whitehall now works on opposite principles: routinely nobody is held responsible for errors and most management works on the basis of ‘give me good news not bad news’. Neither the culture nor incentives focus effort on eliminating errors. Most don’t care and you see those responsible for disaster ambling to the tube at 4pm or going on holiday amid meltdown.
  • Spending on redundancy to improve resilience. Whitehall now works on opposite principles: it tends to treat redundancy as ‘waste’ and its short-term budget processes reinforce decisions that mean out-of-control long-term budgets. By the time the long-term happens, the responsible people have all moved on to better paid jobs and nobody is accountable.
  • Important knowledge is discovered but then the innovation is standardised and codified so it can be easily learned and used by others. Whitehall now works on opposite principles: for example, in the Department for Education officials systematically destroyed its own library. The DfE operated with almost no institutional memory. By the time I left in 2014, after David Cameron banned me from entering any department officials would ask to meet me outside to find out why decisions had been taken in 2011 because three years later almost everybody had moved on to other things. The Foreign Office similarly destroyed its own library.
  • Systems management means lots of process and documentation but at its best it is fluid and purposeful — it is not process for ass-covering. The crucial ‘Gillette Procedures’ swept away red tape and Schriever battled the system to maintain freedom from normal government processes. When asked how he would do a similar programme to Apollo now (1990s) Mueller responded that the only way to do it would be as a classified ‘black’ project to escape the law on issues like procurement. Whitehall now works on opposite principles: its obsession is bullshit process for buck-passing and it fights with all its might against simplification and focus.
  • Saving time saves money. Schriever and Mueller focused on speed and saving time. Whitehall now works on opposite principles: its default mode is to go slower and those who advocate speed are denounced as reckless. Repeatedly in the DfE I was told it was ‘impossible’ to do things in the period I demanded — often less than half what senior officials wanted — yet we often achieved this and there was practically no example of failure that came because my time demands were inherently unreasonable. The system naturally pushes for the longest periods they can get away with to give themselves what they think of as a chance to beat ‘expectations’ but then they often fail on absurdly long timetables. In the DfE we often had a better record of hitting timetables that were ‘impossibly’ short than on those that were traditionally long. Also in many areas there is no downside to pushing fast — the worst that happens is minor and irrelevant embarrassment while the cumulative gains from trying to go fast are huge.
  • The ‘systems’ approach is inherently interdisciplinary ‘because its function is to integrate the specialized separate pieces of a complex of apparatus and people — the system — into a harmonious ensemble that optimally achieves the desired end’ (Ramo). Whitehall now works on opposite principles: it is hopeless at assembling interdisciplinary teams and elevates legal advice over everything in relation to practically any problem, causing huge delays and cost overruns.
  • The ‘matrix management’ system allowed coordination across different departments and different projects.  Whitehall now works on opposite principles. It is stuck with antiquated departments, an antiquated Cabinet Office system, and antiquated project management. Anything ‘cross-government’ is an immediate clue to the savvy that it is doomed and rarely worth wasting time on. A ‘matrix’ approach could and should be applied to break existing hierarchies and speed everything up.
  • People and ideas were more important than technology. Computers and other technologies can help but the main ideas came in the 1950s before personal computers. JSOC applied all sorts of technologies but Colonel Boyd’s dictum holds: people, ideas, technology — in that order. Whitehall now works on opposite principles: for example, the former Cabinet Secretary, Gus O’Donnell, recently blamed a ‘lack of investment’ in IT and a shortage of staff for a huge range of Whitehall blunders. This is really deluded. The central problem is known to all experts and is shown in almost every inquiry: IT projects fail repeatedly in the same ways because of failures of management, not ‘lack of investment’, and adding people to flawed projects is not a solution.

Ministers have little grip of departments and little power to change their direction. They can’t hire or fire and they can’t set incentives. They are almost never in a job long enough to acquire much useful knowledge and they almost never have the sort of management skills that provide alternative value to specific knowledge. They have little chance to change anything and officials ensure this little chance becomes almost no chance.

This story shows how to do things much better than normal. It shows that the principles underlying Mueller’s success are naturally in extreme competition with the principles of management that dominate all normal bureaucracies, public or private. People have been able to read about these principles for decades yet today in Whitehall almost everything runs on exactly the opposite principles: incentives operate to suppress learning. The institutional and policy changes inherent in leaving the EU are a systems problem requiring a systems response. Implementing Mueller’s principles would mean changes to most of the antiquated and failing foundations of Whitehall and bring big improvements and cost savings. Such changes are likely to be resisted by most MPs as well as Whitehall given few of them understand or have experience in high performance teams and would regard Mueller’s approach as a threat to their career prospects.

Because Whitehall is a system failure in which different failures are entangled, its inhabitants tend to potter around in an uncomprehending fog of confusion without understanding why things fail every day and therefore they do not support changes that could improve things even though these changes would be personally advantageous particularly for the first mover.

What is the minimum needed to break bureaucratic resistance and spark a virtuous circle?

How can people outside the system affect mission critical political institutions protected from market competition and resistant to major reforms?

How can we replace many traditional centralised bureaucracies with institutions that mimic successful biological systems such as the immune system that a) use distributed information processing to identify useful structure in the environment, b) find ‘good enough’ solutions in a vast search space of possibilities, and c) move at least ten times faster than existing systems?

[If you find this interesting and/or useful, then the PDF of the whole story is here. It involves some of the cleverest people of the 20th Century, such as John von Neumann.]

Unrecognised simplicities of effective action #1: expertise and a quadrillion dollar business

‘The combination of physics and politics could render the surface of the earth uninhabitable.’ John von Neumann.

Introduction

This series of blogs considers:

  • the difference between fields with genuine expertise, such as fighting and physics, and fields dominated by bogus expertise, such as politics and economic forecasting;
  • the big big problem we face – the world is ‘undersized and underorganised’ because of a collision between four forces: 1) our technological civilisation is inherently fragile and vulnerable to shocks, 2) the knowledge it generates is inherently dangerous, 3) our evolved instincts predispose us to aggression and misunderstanding, and 4) there is a profound mismatch between the scale and speed of destruction our knowledge can cause and the quality of individual and institutional decision-making in ‘mission critical’ institutions – our institutions are similar to those that failed so spectacularly in summer 1914 yet they face crises moving at least ~103 times faster and involving ~106 times more destructive power able to kill ~1010 people;
  • what classic texts and case studies suggest about the unrecognised simplicities of effective action to improve the selection, education, training, and management of vital decision-makers to improve dramatically, reliably, and quantifiably the quality of individual and institutional decisions (particularly 1) the ability to make accurate predictions and b) the quality of feedback);
  • how we can change incentives to aim a much bigger fraction of the most able people at the most important problems;
  • what tools and technologies can help decision-makers cope with complexity.

[I’ve tweaked a couple of things in response to this blog by physicist Steve Hsu.]

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Summary of the big big problem

The investor Peter Thiel (founder of PayPal and Palantir, early investor in Facebook) asks people in job interviews: what billion (109) dollar business is nobody building? The most successful investor in world history, Warren Buffett, illustrated what a quadrillion (1015) dollar business might look like in his 50th anniversary letter to Berkshire Hathaway investors.

‘There is, however, one clear, present and enduring danger to Berkshire against which Charlie and I are powerless. That threat to Berkshire is also the major threat our citizenry faces: a “successful” … cyber, biological, nuclear or chemical attack on the United States… The probability of such mass destruction in any given year is likely very small… Nevertheless, what’s a small probability in a short period approaches certainty in the longer run. (If there is only one chance in thirty of an event occurring in a given year, the likelihood of it occurring at least once in a century is 96.6%.) The added bad news is that there will forever be people and organizations and perhaps even nations that would like to inflict maximum damage on our country. Their means of doing so have increased exponentially during my lifetime. “Innovation” has its dark side.

‘There is no way for American corporations or their investors to shed this risk. If an event occurs in the U.S. that leads to mass devastation, the value of all equity investments will almost certainly be decimated.

‘No one knows what “the day after” will look like. I think, however, that Einstein’s 1949 appraisal remains apt: “I know not with what weapons World War III will be fought, but World War IV will be fought with sticks and stones.”’

Politics is profoundly nonlinear. (I have written a series of blogs about complexity and prediction HERE which are useful background for those interested.) Changing the course of European history via the referendum only involved about 10 crucial people controlling ~£107  while its effects over ten years could be on the scale of ~108 – 10people and ~£1012: like many episodes in history the resources put into it are extremely nonlinear in relation to the potential branching histories it creates. Errors dealing with Germany in 1914 and 1939 were costly on the scale of ~100,000,000 (108) lives. If we carry on with normal human history – that is, international relations defined as out-groups competing violently – and combine this with modern technology then it is extremely likely that we will have a disaster on the scale of billions (109) or even all humans (~1010). The ultimate disaster would kill about 100 times more people than our failure with Germany. Our destructive power is already much more than 100 times greater than it was then: nuclear weapons increased destructiveness by roughly a factor of a million.

Even if we dodge this particular bullet there are many others lurking. New genetic engineering techniques such as CRISPR allow radical possibilities for re-engineering organisms including humans in ways thought of as science fiction only a decade ago. We will soon be able to remake human nature itself. CRISPR-enabled ‘gene drives’ enable us to make changes to the germ-line of organisms permanent such that changes spread through the entire wild population, including making species extinct on demand. Unlike nuclear weapons such technologies are not complex, expensive, and able to be kept secret for a long time. The world’s leading experts predict that people will be making them cheaply at home soon – perhaps they already are. These developments have been driven by exponential progress much faster than Moore’s Law reducing the cost of DNA sequencing per genome from ~$108 to ~$10in roughly 15 years.

screenshot-2017-01-16-12-24-13

It is already practically possible to deploy a cheap, autonomous, and anonymous drone with facial-recognition software and a one gram shaped-charge to identify a relevant face and blow it up. Military logic is driving autonomy. For example, 1) the explosion in the volume of drone surveillance video (from 71 hours in 2004 to 300,000 hours in 2011 to millions of hours now) requires automated analysis, and 2) jamming and spoofing of drones strongly incentivise a push for autonomy. It is unlikely that promises to ‘keep humans in the loop’ will be kept. It is likely that state and non-state actors will deploy low-cost drone swarms using machine learning to automate the ‘find-fix-finish’ cycle now controlled by humans. (See HERE for a video just released for one such program and imagine the capability when they carry their own communication and logistics network with them.)

In the medium-term, many billions are being spent on finding the secrets of general intelligence. We know this secret is encoded somewhere in the roughly 125 million ‘bits’ of information that is the rough difference between the genome that produces the human brain and the genome that produces the chimp brain. This search space is remarkably small – the equivalent of just 25 million English words or 30 copies of the King James Bible. There is no fundamental barrier to decoding this information and it is possible that the ultimate secret could be described relatively simply (cf. this great essay by physicist Michael Nielsen). One of the world’s leading experts has told me they think a large proportion of this problem could be solved in about a decade with a few tens of billions and something like an Apollo programme level of determination.

Not only is our destructive and disruptive power still getting bigger quickly – it is also getting cheaper and faster every year. The change in speed adds another dimension to the problem. In the period between the Archduke’s murder and the outbreak of World War I a month later it is striking how general failures of individuals and institutions were compounded by the way in which events moved much faster than the ‘mission critical’ institutions could cope with such that soon everyone was behind the pace, telegrams were read in the wrong order and so on. The crisis leading to World War I was about 30 days from the assassination to the start of general war – about 700 hours. The timescale for deciding what to do between receiving a warning of nuclear missile launch and deciding to launch yourself is less than half an hour and the President’s decision time is less than this, maybe just minutes. This is a speedup factor of at least 103.

Economic crises already occur far faster than human brains can cope with. The financial system has made a transition from people shouting at each other to a a system dominated by high frequency ‘algorithmic trading’ (HFT), i.e. machine intelligence applied to robot trading with vast volumes traded on a global spatial scale and a microsecond (10-6) temporal scale far beyond the monitoring, understanding, or control of regulators and politicians. There is even competition for computer trading bases in specific locations based on calculations of Special Relativity as the speed of light becomes a factor in minimising trade delays (cf. Relativistic statistical arbitrage, Wissner-Gross). ‘The Flash Crash’ of 9 May 2010 saw the Dow lose hundreds of points in minutes. Mini ‘flash crashes’ now blow up and die out faster than humans can notice. Given our institutions cannot cope with economic decisions made at ‘human speed’, a fortiori they cannot cope with decisions made at ‘robot speed’. There is scope for worse disasters than 2008 which would further damage the moral credibility of decentralised markets and provide huge chances for extremist political entrepreneurs to exploit. (* See endnote.)

What about the individuals and institutions that are supposed to cope with all this?

Our brains have not evolved much in thousands of years and are subject to all sorts of constraints including evolved heuristics that lead to misunderstanding, delusion, and violence particularly under pressure. There is a terrible mismatch between the sort of people that routinely dominate mission critical political institutions and the sort of people we need: high-ish IQ (we need more people >145 (+3SD) while almost everybody important is between 115-130 (+1 or 2SD)), a robust toolkit for not fooling yourself including quantitative problem-solving (almost totally absent at the apex of relevant institutions), determination, management skills, relevant experience, and ethics. While our ancestor chiefs at least had some intuitive feel for important variables like agriculture and cavalry our contemporary chiefs (and those in the media responsible for scrutiny of decisions) generally do not understand their equivalents, and are often less experienced in managing complex organisations than their predecessors.

The national institutions we have to deal with such crises are pretty similar to those that failed so spectacularly in summer 1914 yet they face crises moving at least ~103 times faster and involving ~106 times more destructive power able to kill ~1010 people. The international institutions developed post-1945 (UN, EU etc) contribute little to solving the biggest problems and in many ways make them worse. These institutions fail constantly and do not  – cannot – learn much.

If we keep having crises like we have experienced over the past century then this combination of problems pushes the probability of catastrophe towards ‘overwhelmingly likely’.

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What Is To be Done? There’s plenty of room at the top

‘In a knowledge-rich world, progress does not lie in the direction of reading information faster, writing it faster, and storing more of it. Progress lies in the direction of extracting and exploiting the patterns of the world… And that progress will depend on … our ability to devise better and more powerful thinking programs for man and machine.’ Herbert Simon, Designing Organizations for an Information-rich World, 1969.

‘Fascinating that the same problems recur time after time, in almost every program, and that the management of the program, whether it happened to be government or industry, continues to avoid reality.’ George Mueller, pioneer of ‘systems engineering’ and ‘systems management’ and the man most responsible for the success of the 1969 moon landing.

Somehow the world has to make a series of extremely traumatic and dangerous transitions over the next 20 years. The main transition needed is:

Embed reliably the unrecognised simplicities of high performance teams (HPTs), including personnel selection and training, in ‘mission critical’ institutions while simultaneously developing a focused project that radically improves the prospects for international cooperation and new forms of political organisation beyond competing nation states.

Big progress on this problem would automatically and for free bring big progress on other big problems. It could improve (even save) billions of lives and save a quadrillion dollars (~$1015). If we avoid disasters then the error-correcting institutions of markets and science will, patchily, spread peace, prosperity, and learning. We will make big improvements with public services and other aspects of ‘normal’ government. We will have a healthier political culture in which representative institutions, markets serving the public (not looters), and international cooperation are stronger.

Can a big jump in performance – ‘better and more powerful thinking programs for man and machine’ – somehow be systematised?

Feynman once gave a talk titled ‘There’s plenty of room at the bottom’ about the huge performance improvements possible if we could learn to do engineering at the atomic scale – what is now called nanotechnology. There is also ‘plenty of room at the top’ of political structures for huge improvements in performance. As I explained recently, the victory of the Leave campaign owed more to the fundamental dysfunction of the British Establishment than it did to any brilliance from Vote Leave. Despite having the support of practically every force with power and money in the world (including the main broadcasters) and controlling the timing and legal regulation of the referendum, they blew it. This was good if you support Leave but just how easily the whole system could be taken down should be frightening for everybody .

Creating high performance teams is obviously hard but in what ways is it really hard? It is not hard in the same sense that some things are hard like discovering profound new mathematical knowledge. HPTs do not require profound new knowledge. We have been able to read the basic lessons in classics for over two thousand years. We can see relevant examples all around us of individuals and teams showing huge gains in effectiveness.

The real obstacle is not financial. The financial resources needed are remarkably low and the return on small investments could be incalculably vast. We could significantly improve the decisions of the most powerful 100 people in the UK or the world for less than a million dollars (~£106) and a decade-long project on a scale of just ~£107 could have dramatic effects.

The real obstacle is not a huge task of public persuasion – quite the opposite. A government that tried in a disciplined way to do this would attract huge public support. (I’ve polled some ideas and am confident about this.) Political parties are locked in a game that in trying to win in conventional ways leads to the public despising them. Ironically if a party (established or new) forgets this game and makes the public the target of extreme intelligent focus then it would not only make the world better but would trounce their opponents.

The real obstacle is not a need for breakthrough technologies though technology could help. As Colonel Boyd used to shout, ‘People, ideas, machines – in that order!’

The real obstacle is that although we can all learn and study HPTs it is extremely hard to put this learning to practical use and sustain it against all the forces of entropy that constantly operate to degrade high performance once the original people have gone. HPTs are episodic. They seem to come out of nowhere, shock people, then vanish with the rare individuals. People write about them and many talk about learning from them but in fact almost nobody ever learns from them – apart, perhaps, from those very rare people who did not need to learn – and nobody has found a method to embed this learning reliably and systematically in institutions that can maintain it. The Prussian General Staff remained operationally brilliant but in other ways went badly wrong after the death of the elder Moltke. When George Mueller left NASA it reverted to what it had been before he arrived – management chaos. All the best companies quickly go downhill after the departure of people like Bill Gates – even when such very able people have tried very very hard to avoid exactly this problem.

Charlie Munger, half of the most successful investment team in world history, has a great phrase he uses to explain their success that gets to the heart of this problem:

‘There isn’t one novel thought in all of how Berkshire [Hathaway] is run. It’s all about … exploiting unrecognized simplicities… It’s a community of like-minded people, and that makes most decisions into no-brainers. Warren [Buffett] and I aren’t prodigies. We can’t play chess blindfolded or be concert pianists. But the results are prodigious, because we have a temperamental advantage that more than compensates for a lack of IQ points.’

The simplicities that bring high performance in general, not just in investing, are largely unrecognised because they conflict with many evolved instincts and are therefore psychologically very hard to implement. The principles of the Buffett-Munger success are clear – they have even gone to great pains to explain them and what the rest of us should do – and the results are clear yet still almost nobody really listens to them and above average intelligence people instead constantly put their money into active fund management that is proved to destroy wealth every year!

Most people think they are already implementing these lessons and usually strongly reject the idea that they are not. This means that just explaining things is very unlikely to work:

‘I’d say the history that Charlie [Munger] and I have had of persuading decent, intelligent people who we thought were doing unintelligent things to change their course of action has been poor.’ Buffett.

Even more worrying, it is extremely hard to take over organisations that are not run right and make them excellent.

‘We really don’t believe in buying into organisations to change them.’ Buffett.

If people won’t listen to the world’s most successful investor in history on his own subject, and even he finds it too hard to take over failing businesses and turn them around, how likely is it that politicians and officials incentivised to keep things as they are will listen to ideas about how to do things better? How likely is it that a team can take over broken government institutions and make them dramatically better in a way that outlasts the people who do it? Bureaucracies are extraordinarily resistant to learning. Even after the debacles of 9/11 and the Iraq War, costing many lives and trillions of dollars, and even after the 2008 Crash, the security and financial bureaucracies in America and Europe are essentially the same and operate on the same principles.

Buffett’s success is partly due to his discipline in sticking within what he and Munger call their ‘circle of competence’. Within this circle they have proved the wisdom of avoiding trying to persuade people to change their minds and avoiding trying to fix broken institutions.

This option is not available in politics. The Enlightenment and the scientific revolution give us no choice but to try to persuade people and try to fix or replace broken institutions. In general ‘it is better to undertake revolution than undergo it’. How might we go about it? What can people who do not have any significant power inside the system do? What international projects are most likely to spark the sort of big changes in attitude we urgently need?

This is the first of a series. I will keep it separate from the series on the EU referendum though it is connected in the sense that I spent a year on the referendum in the belief that winning it was a necessary though not sufficient condition for Britain to play a part in improving the quality of government dramatically and improving the probability of avoiding the disasters that will happen if politics follows a normal path. I intended to implement some of these ideas in Downing Street if the Boris-Gove team had not blown up. The more I study this issue the more confident I am that dramatic improvements are possible and the more pessimistic I am that they will happen soon enough.

Please leave comments and corrections…

* A new transatlantic cable recently opened for financial trading. Its cost? £300 million. Its advantage? It shaves 2.6 milliseconds off the latency of financial trades. Innovative groups are discussing the application of military laser technology, unmanned drones circling the earth acting as routers, and even the use of neutrino communication (because neutrinos can go straight through the earth just as zillions pass through your body every second without colliding with its atoms) – cf. this recent survey in Nature.