Matt Ridley in denial about his book's mistakes
2.The ex-Northern Rock man is in denial about his book's mistakes
NOTE: Matt Ridley's a keen supporter of GM and was the first chairman of the International Centre for Life, a multi-million pound 'science park and education project' to 'foster the life sciences'. He's also on the Advisory Council of the controversial pro-GM lobby group Sense About Science. He's called environmentalists 'Gestapo' and has attacked the science of climate change and what he termed 'ozone exaggeration'. According to Ridley, many 'green' arguments are just socialist ones in new clothing. He's also a staunch critic of organic farming, even repeating Dennis Avery's notorious claim that organic foods are more likely to kill you - in Ridley's words: 'people who eat the products of...[organic agriculture] are eight times more likely to contract the strain of E-coli that killed 21 people in Lanarkshire'.
1.This state-hating free marketeer ignores his own failed experiment
The Guardian, 31 May 2010
*Matt Ridley, the former head of Northern Rock, is peddling theories riddled with blame-shifting and excruciating errors
Brass neck doesn't begin to describe it. Matt Ridley used to make his living partly by writing state-bashing columns in the Daily Telegraph. The government, he complained, is "a self-seeking flea on the backs of the more productive people of this world ”¦ governments do not run countries, they parasitise them". Taxes, bailouts, regulations, subsidies, intervention of any kind, he argued, are an unwarranted restraint on market freedom.
Then he became chairman of Northern Rock, where he was able to put his free market principles into practice. Under his chairmanship, the bank pursued what the Treasury select committee later described as a "high-risk, reckless business strategy". It was able to do so because the government agency that oversees the banks "systematically failed in its regulatory duty".
On 16 August 2007, Ridley rang an agent of the detested state to explore the possibility of a bailout. The self-seeking fleas agreed to his request, and in September the government opened a support facility for the floundering bank. The taxpayer eventually bailed out Northern Rock to the tune of £27bn.
When news of the crisis leaked, it caused the first run on a bank in this country since 1878. The parasitic state had to intervene a second time: the run was halted only when the government guaranteed the depositors' money. Eventually, the government was obliged to nationalise the bank. Investors, knowing that their money would now be safe, as it was protected by the state, began to return.
While the crisis was made possible by a "substantial failure of regulation", MPs identified the directors of Northern Rock as "the principal authors of the difficulties that the company has faced". They singled Ridley out for having failed "to provide against the risks that [Northern Rock] was taking and to act as an effective restraining force on the strategy of the executive members".
This, you might think, must have been a salutary experience. You would be wrong. Last week, Ridley published a new book titled The Rational Optimist. He uses it as a platform to attack governments that, among other crimes, "bail out big corporations". He lambasts intervention and state regulation, insisting that markets deliver the greatest possible benefits to society when left to their own devices. Has there ever been a clearer case of the triumph of faith over experience?
Free-market fundamentalists, apparently unaware of Ridley's own experiment in market liberation, are currently filling cyberspace and the mainstream media with gasps of enthusiasm about his thesis. Ridley provides what he claims is a scientific justification for unregulated business. He maintains that rising consumption will keep enriching us for "centuries and millennia" to come, but only if governments don't impede innovation. He dismisses or denies the environmental consequences, laments our risk-aversion, and claims that the market system makes self-interest "thoroughly virtuous". All will be well in the best of all possible worlds, as long as the "parasitic bureaucracy" keeps its nose out of our lives.
His book is elegantly written and cast in the language of evolution, but it's the same old cornutopian nonsense we've heard one hundred times before (cornutopians are people who envisage a utopia of limitless abundance). In this case, however, it has already been spectacularly disproved by the author's experience.
The Rational Optimist is riddled with excruciating errors and distortions. Ridley claims, for instance, that "every country that tried protectionism" after the second world war suffered as a result. He cites South Korea and Taiwan as "countries that went the other way", and experienced miraculous growth. In reality, the governments of both nations subsidised key industries, actively promoted exports, and used tariffs and laws to shut out competing imports. In both countries the state owned all the major commercial banks, allowing it to make decisions about investment (all references are on my website).
He maintains that "Enron funded climate alarmism". The reference he gives demonstrates nothing of the sort, nor can I find evidence for this claim elsewhere. He says that "no significant error has come to light" in BjÃ¸rn Lomborg's book The Sceptical Environmentalist. In fact, it contains so many significant errors that an entire book The Lomborg Deception by Howard Friel was required to document them.
Ridley asserts that average temperature changes over "the last three decades" have been "relatively slow". In reality, the rise over this period has been the most rapid since instrumental records began. He maintains that "11 of 13 populations" of polar bears are "growing or steady". There are in fact 19 populations of polar bears. Of those whose fluctuations have been measured, one is increasing, three are stable, and eight are declining.
He uses blatant cherry-picking to create the impression that ecosystems are recovering: water snake numbers in Lake Erie, fish populations in the Thames, bird's eggs in Sweden. But as the Millennium Ecosystem Assessment shows, of 65 global indicators of human impacts on biodiversity, only one the extent of temperate forests is improving. Eighteen are stable, in all the other cases, the impacts are increasing.
Northern Rock grew rapidly by externalising its costs, pursuing money-making schemes that would eventually be paid for by other people. Ridley encourages us to treat the planet the same way. He either ignores or glosses over the costs of ever-expanding trade and perpetual growth. His timing, as BP fails to contain the oil spill in the Gulf of Mexico, is unfortunate. Like the collapse of Northern Rock, the Deepwater Horizon disaster was made possible by weak regulation. Ridley would weaken it even further, leaving public protection to the invisible hand of the market.
He might not have been chastened by experience, but it would be wrong to claim that he has learned nothing. On the contrary, he has developed a fine line in blame-shifting and post-rational justification. He mentions Northern Rock only once in his book, where he blames the crisis on "government housing and monetary policy." It was the state wot made him do it. He asserts that while he wants to reduce the regulation of markets in goods and services, he has "always supported" the careful regulation of financial markets. He provides no evidence for this, and I cannot find it in anything he wrote before the crisis.
Other than that, he claims, he can say nothing, due to the terms of his former employment at the bank. I suspect this constraint is overstated: it's unlikely that it forbids him from accepting his share of the blame.
It is only from the safety of the regulated economy, in which governments pick up the pieces when business screws up, that people like Ridley can pursue their magical thinking. Had the state he despises not bailed out his bank and rescued its depositors' money, his head would probably be on a pike by now. Instead we see it on our television screens, instructing us to apply his irrational optimism more widely. And no one has yet been rude enough to use the word discredited.
2.Matt Ridley's Rational Optimist is telling the rich what they want to hear
The Guardian, 18 June 2010
*The ex-Northern Rock man is in denial about his book's mistakes
It's a hackneyed image, I admit, but I'm beginning to feel like the boy who noticed that the monarch was suffering from a serious wardrobe malfunction. In this case, however, the story's not working out like the original: it seldom does. Exposed, the emperor continues to strut about naked while everyone keeps oohing and aahing over his fine vestments. He confidently asserts that the boy is wrong and he is in fact fully clothed. Desperate to believe that this is true, the crowd agrees. The more you point out the obvious truth, the more defensive and aggressive he becomes.
A couple of weeks ago, I wrote a column for the Guardian exploring the contrast between Matt Ridley's assertions in his new book The Rational Optimist and his own experience. In the book, Ridley attacks the "parasitic bureaucracy", which stifles free enterprise and excoriates governments for, among other sins, bailing out big corporations. If only the market is left to its own devices, he insists, and not stymied by regulations, the outcome will be wonderful for everybody.
What Ridley glosses over is that before he wrote this book he had an opportunity to put his theories into practice. As chairman of Northern Rock, he was responsible, according to parliament's Treasury select committee, for a "high-risk, reckless business strategy". Northern Rock was able to pursue this strategy as a result of a "substantial failure of regulation" by the state. The wonderful outcome of this experiment was the first run on a British bank since 1878, and a £27bn government bail-out.
But it's not just Ridley who doesn't mention the inconvenient disjunction between theory and practice: hardly anyone does. His book has now been reviewed dozens of times, and almost all the reviewers have either been unaware of his demonstration of what happens when his philosophy is applied or too polite to mention it. The reason, as far as I can see, is that Ridley is telling people especially rich, powerful people what they want to hear.
He tells them that they needn't worry about social or environmental issues, because these will sort themselves out if the market is liberated from government control. He tells them that they are right to assert that government should get off their backs and stop interfering with its pettifogging rules and regulations: they should be left alone to make as much money as they like, however they like. He tells them that poorly regulated greed of the kind that he oversaw at Northern Rock is, in fact, a great moral quest, which makes the world a better place. I expect the executives of BP have each ordered several copies.
Just imagine what the response would have been if someone who tells the rich and powerful what they don't want to hear had caused the first run on a British bank in 130 years and had to go crawling to the people he had spent years attacking for a £27bn bailout. Imagine that this person, having learned nothing from the experience, then published a book insisting that the strategy he applied with such catastrophic consequences should be rolled out universally.
Crucifixion wouldn't have been good enough for him. Reviewers and leader writers would pile in, heaping execrations on his head. But because Ridley preaches the business gospel, he's being celebrated throughout the rightwing press, as well as in parts of the liberal media (sometimes I wonder whether we're too liberal for our own good).
When someone explains an inconvenient truth about politics that the business elite reviles, it is immediately taken up and echoed in hundreds of blogs and articles. When, as I have found many times before, you explain an inconvenient truth about neoliberal or anti-environmental ideas, it is met with silence. The media simply looks the other way. There is a massive rightwing echo chamber. Nothing comparable exists on the left.
I also pointed out that Ridley had made a series of shocking errors and distortions in his book. I showed how he had misrepresented economic history, made claims that bore no relation to the references he gave, and reeled off facts about the environment which were just plain wrong. Again, none of this has been picked up by Ridley's reviewers.
Ridley himself has claimed that his shocking mistakes aren't mistakes at all, then proceeds to compound them with a series of spurious justifications. Here are a few examples:
1. I pointed out that his claim that "Enron-funded climate alarmism" is not supported by the source he gives. Now, Ridley cites another URL to prove that even though he didn't know it at the time he was right all along, because it shows that Enron did in fact fund climate alarmism. Only one problem: it doesn't. So that's two false sources for one false claim. Good going Matt.
2. Ridley hilariously maintained that "no significant error has come to light" in BjÃ¸rn Lomborg's book The Sceptical Environmentalist. I pointed out that it contains so many significant errors that an entire book The Lomborg Deception by Howard Friel was required to document them. Now, without having read Friel's book, Ridley accepts that it is all nonsense on the word of ”¦ BjÃ¸rn Lomborg! Quite right too: what more objective reviewer of a book about BjÃ¸rn Lomborg's errors could there be than, er, BjÃ¸rn Lomborg? Ridley then has the blazing chutzpah to state that "Monbiot should be embarrassed to be relying on a source of this quality". No, he doesn't mean Lomborg's rebuttal, he means Friel's book.
3. In his book, Ridley asserts that "11 of 13 populations" of polar bears are "growing or steady". I pointed out that there are in fact 19 populations of polar bears, and cited the most comprehensive and widely-respected research, collated by the IUCN Polar Bear Specialist Group, which suggests that of those whose fluctuations have been measured, one is increasing, three are stable and eight are declining. Forgetting that he made a definitive statement about the bears' status in his book, Ridley now says that "nobody really knows the truth and lots of different claims are out there." Yes, but some are more credible than others. Ridley chose to ignore the most credible studies, while relying instead on: "(a) a source that doesn't mention polar bears, (b) an oil industry funded source, and (c) a non peer reviewed lecture at an undisclosed location in an undisclosed month and year".
The quote is from Howard Friel, who has been drawn into this debate by Ridley's gross mischaracterisation of his book, and has done some digging of his own.
So, given that Ridley has bothered to reply on this point, you'd imagine that he would come up with some powerful data to rebut the comprehensive study I cited. You'd be wrong. Instead he relies on an interview on CBC News with a local Canadian politician, who asserts that his impression, after talking to people who want to hunt polar bears or the animals which polar bears prey on, is that the Canadian Arctic population (not the total population you understand) isn't declining. No numbers, no analysis, no cited sources, no scientific study at all. Yes, dear reader, this really is Ridley's withering retort. And he calls himself a scientist.
4. I accused Ridley of blatant cherry-picking in the following passage in The Rational Optimist: "Well alight, says the pessimist, but at what cost? The environment is surely deteriorating. In somewhere like Beijing, maybe. But in many other places, no. In Europe and America rivers, lakes, seas and the air are getting cleaner all the time. The Thames has less sewage and more fish. Lake Erie's water snakes, on the brink of extinction in the 1960s, are now abundant. Bald eagles have boomed. Pasadena has few smogs. Swedish birds' eggs have 75% fewer pollutants in them than in the 1960s."
I pointed out as the Millennium Ecosystem Assessment shows that of 65 global indicators of human impacts on biodiversity, only one the extent of temperate forests is improving. Eighteen are stable, in all the other cases the impacts are increasing. Ridley retorts that readers of the passage I've just cited "can judge if I am doing anything other than claiming that "in many places' environmental trends are positive." You certainly can. Take a look at these two sentences again: "The environment is surely deteriorating. In somewhere like Beijing, maybe."
Here Ridley makes an obvious attempt to suggest that environmental deterioration is confined to places like Beijing. Comparing these sentences to those that follow, any reader who didn't know better would assume that improvement is more common than deterioration.
If Ridley really believes that this passage isn't designed to suggest that the general trend is positive, his intellectual dishonesty runs deeper than I had imagined. And if he can't see that his selective treatment of the subject is blatant cherry-picking, it says more than he would care to about his standards of objectivity.
The other two refutations he attempts are just as wrong, but I would need several hundred more words in each case to explain why, and I won't try your patience any further. At the end of this farrago of nonsense, Ridley asserts that "Monbiot is entitled to his opinions but he has found precisely zero 'excruciating errors' in my book."
I'm sure he found himself very persuasive.
But if no one else is prepared to call him out on this, he will continue to get away with both the disavowal of his own record and the denial of his glaring mistakes. And he will continue to deceive the growing band of people who are treating his book as the self-justification they have always sought. Paradoxically, many of them are the same people who, devoted to free market principles, have been denouncing both the evil bankers who trashed the economy and the governments who bailed them out. If they knew a little more about Dr Ridley's interesting attempt to put his theories into practice, they might be less ready to believe his misleading assertions.