Andrew Gelman:

A quick rule of thumb is that when someone seems to be acting like a jerk, an economist will defend the behavior as being the essence of morality, but when someone seems to be doing something nice, an economist will raise the bar and argue that he’s not being nice at all.

Austerity: The LARP

Everyone in Britain is playing a game called Austerity. Some are playing the game with enthusiasm and conviction. Some are playing with calculation and cunning. And others believe they are not playing, when in fact they cannot escape the game.

Austerity is not a console game with expensive graphics, nor is it an addictive casual game for smartphones. It is a LARP: a Live Action Role-Playing game. Like other LARPs, this game consumes your environment and your life. Unlike other LARPs, Austerity does not take place on a disused Swedish naval destroyer and end after a weekend. You will live and breathe Austerity for as long as everyone continues to believe in it, which means it may have no end.

It has a beginning, though: the Second World War.

Nostalgia is an intoxicating brew. We venerate WW2, the last time Britain was Great, the last time the Kingdom felt truly United, the last time we had a national victory that wasn’t on the field of play. It’s natural to look back fondly on such times, acknowledging the horrors and respecting the sacrifice.

Wait, no. Not respecting the sacrifice – fetishising it.

This is Keep Calm and Carry On. This is Dig for Victory, ration books, Downton Abbey (sort of) and Doctor Who’s innumerable wartime stories.

Dig for Victory and ration books are real, of course. They were part of the civilian mission to harness the entire capacity of a country in the pursuit of victory in a total war. Likewise, war bonds and volunteering and sewing clothes for the men. Money was tight but it was necessary to be thrifty. Virtuous, even. And who can say that the war was not won by such virtuous sacrifice?

Austerity has those sentiments at its heart: sacrifice is necessary for victory against an existential threat such as the Nazis.

Today’s existential threats are the European Union, immigrants, a slightly high debt-to-GDP ratio, and a lack of respect from other countries. To prevail against such enemies, hard choices must be made. We cannot afford to waste money on shirkers, or waste money on fripperies such as arts and culture. We must cut taxes on entrepreneurs and reward hard-working families, because people who are not in families, and people who do not work hard, do not deserve anything.

Now, it may be that these hard choices often end up benefitting those who already have lots of money; but this is where the game becomes important as a justification and a distraction. If players are encouraged to emulate the heroes of WW2, to Keep Calm and Carry On, then we will be prepared to sacrifice anything to save the nation from existential threats: to cut social security, to close those theatres and museums.

Sometimes players get upset when they perceive that other players are breaking the immersion, as can happen in other LARPs. For example, we didn’t have all these foreigners back in WW2, so it’s wrong to have them here now. We didn’t have wind power and solar power either, so that must also be wrong.

But the truth is, we are all breaking the rules in Austerity. If we were really committing to the LARP, then we would be investing hours a day into community gardens and volunteer work. We would be living and fighting and dying, cheek by jowl, on the front lines, the baker next to the banker, the lawyer next to the labourer.

Real believers in Austerity would reinstate the two thousand British Restaurants, communal kitchens that would sell you a healthy meal for the equivalent of £1 in today’s money. They would serve a million meals a day to those who couldn’t afford any better, and they would make the country fit and strong.

Like other LARPs, Austerity is a sham. And like other LARPs, a lot of players don’t want to take on the hard roles – they just want to do the easy fun stuff; the sewing and dressing up and saving pennies while forcing other players to part with pounds. That is why the special mission in Austerity, “The Big Society”, was such a failure.

The real danger of the Austerity LARP, though, is that it’s not actually real. We don’t live in 1945 any more; we live in 2015. We do not face an existential threat to the nation (other than perhaps climate change). We are not obliged to spend £45 billion, or 2.2% of GDP, on a non-productive military. We do, however, have the money to spend more on the institutions that made this country great: social security, NHS, the universities, the schools.

We need to snap the fuck out this playtime and get real.

The Phantom ‘Global Race’

There’s been a lot of talk from Conservative politicians in the UK about the ‘global race‘. This race, we’re led to believe, involves all the countries of the world. The winners are those countries that can compete the best, presumably by selling more things cheaper than anyone else can, by dint of working harder and being smarter.

Races, and competitions in general, are perfectly reasonable for situations where the thing you want to find out (or to optimise) is easily and directly measured; so, for example, if you want to find out who the fastest runner in the world is, then you hold a series of races where you measure everyone’s speed. No problem, everyone’s happy.

Now, while such races are entertaining to watch and may tell you something about the human spirit, etc, they are not of direct relevance to most people’s lives because most people are not that interested in becoming the fastest runner in the world. They may want to run, because it’s fun to do so or because they want to lose weight, and in the process they may find it fun to try and run faster, but in all the 5k and 10k and half-marathons I’ve run in, there’s only one winner and about 5000 losers. None of those losers consider themselves losers because they aren’t really competing against anyone except for, perhaps, themselves.

That’s where the problem with the global race comes in. The metaphor is chosen because we all know what races are, and we all know that sacrifices must be made in order to win them. We all know about Olympic athletes who swim for eight hours a day or who run on Christmas and New Year’s Day just to get a bit more training in than their rivals. Therefore, if we’re in a global race, everyone in the country must pull together and make sacrifices in order to win.

But what does it mean to win the global race? What, exactly, are we measuring?

GDP per capita? According to the International Monetary Fund, the top spot is held by Qatar, with $100,889; the UK lies at 24th place with $36,569. It’s safe to say we won’t be winning that particular race any time soon. More importantly, I don’t think anyone in the UK is particularly jealous of Qatari citizens other than the fact that they probably own some really nice cars and electronics.

Productivity rates? Out of the OECD countries, Luxembourg and Norway come out top when measured by GDP per hour worked; as of 2007, the UK lay in 11th place. Now, I like Norway a lot, but I suspect the Tories don’t, otherwise they’d be renationalising the energy sector, employing more government workers, expanding the welfare state, and giving parents 46 weeks of paid leave.

Neither measurement is satisfactory. Taiwan, Sweden, Ireland, Hong Kong, and the US all outperform the UK. Does that mean they’re winning in the global race, and so we should mimic whatever they do? Singapore is well up there, perhaps the UK should also become a one-party country. Or maybe, like Germany (who are also beating us), we should require large companies to have workers councils and also adopt proportional representation.

We don’t know who the winners and losers of the global race are because we don’t know what the race is for — and even if we did know, we couldn’t simply just copy what the winners do, because we aren’t about to magically discover more oil in the North Sea, or because we aren’t prepared to adopt the policies of Taiwan or Singapore, or because we know that what works for smaller countries won’t work for us.

As for GDP and productivity figures (which are easily manipulated and hard to compare between countries), they’re only useful as a means towards an end, which may, depending on your politics, include healthier and happier citizens, or citizens who have a great deal of autonomy, or citizens who live fulfilling lives. Those ends can be achieved in many different ways and it’s not always clear that money will help, otherwise Qatar would have the happiest, healthiest, smartest, and most fulfilled citizens in the world. The vagueness of the global race is deliberate, or at least, extremely advantageous, because it allows the Tories to justify more or less any policy they want.

But what’s most disappointing to me is not the vagueness. It’s the lack of vision. We know we don’t want to be poor. But what do we win, and what do we sacrifice, by being rich?

Meeting Room Yield Management

Six to Start is based in a large building containing dozens of managed and serviced offices. On the way to the shared kitchen at work, I noticed two empty meeting rooms. It occurred to me that, just like an empty seat on a plane, an empty meeting room is lost cash. Sure, there is a small cost on keeping the room clean and well-maintained, but the standard fees for meeting room use provide an enormous profit margin. Given that most of the cost for the room – building it and buying furniture – has already been paid, surely it would be wise to keep it in use as much as possible, even at a lower per-hour fee, in order to maximise profit?

I suspect that most building managers don’t bother doing this for one main reason – it would take too much work. To prevent losing money either through oversupply (by means of unused meeting rooms that could’ve been offices) or undersupply (by means of lost meeting room fees when all the rooms are full) there is usually a certain ratio of meeting rooms to offices.

Obviously the calcuation isn’t perfect. Most rooms will be empty most of the time, and occasionally all the rooms will be full. In order to still try and make money, managers will set the fees at a rate that will – over time – cover costs, even when the room is empty.

This is incredibly inefficient – as inefficient as an airline setting a single price for tickets within a class, and then letting the plane fly with any seats empty. In 1985, American Airlines began a yield management program in which otherwise empty seats were sold cheaply. Nowadays, we all know that there are certain days where tickets cost much more, and that we can also snap up bargains if we wait until the very last minute.

So, why not perform yield management on meeting rooms? Set up a simple tracking system for usage of all meeting rooms in a building and dynamically set prices based on both historic and live demand. Bump up the prices for rooms at peak times (late morning, early afternoon) and for those reserving in advance for important meetings, and reduce them for slower times (evening, weekends). Allow non-time sensitive customers to check prices so that they can snap up a bargain if the room is empty for an impromptu brainstorm.

The main reason I’m interested in this is not because Six to Start needs to use meeting rooms a lot, or that I see this as a brilliant business opportunity (then again, who knows…); it’s because my thoughts have lately often turned to organising events like Barcamps and miniconferences. These sorts of events are relatively easy to set up, but you do still need to find a reasonably large amount of space, which can be tricky to find. I remember standing on the roof garden during GameCamp (kindly hosted by Sony 3Rooms by Brick Lane) and looking out at the large office buildings nearby, thinking of the dozens if not hundreds of meeting rooms that were going empty right at the moment. Rooms that could be used – and paid for – by any number of interest groups, clubs, conferences and reading groups. If buildings plugged their data into a central website (say, which aggregated and displayed all meeting room availability and prices in a city, you could really make the system much more efficient. Perhaps in time you would even have people buying meeting room futures, or suchlike.

There must be any number of physical resources like airplane seats in which:

  • There is a fixed amount of resources available for sale.
  • The resources sold are perishable. This means that there is a time limit to selling the resources, after which they cease to be of value.
  • Different customers are willing to pay a different price for using the same amount of resources.

where yield management isn’t being used because the prices don’t justify it yet (after all, flights are more expensive). But as the price of the software comes down and administering the use of the resources becomes more streamlined, I think we’ll be seeing yield management being applied to all sorts of weird things like cars, bicycles, rarely-used powertools, pianos, gardens and so on. What a glorious future we have ahead of us!