What We Owe Each Other, by Minouche Shafik

Minouche Shafik, Director of the London School of Economics
Minouche Shafik, Director of the London School of Economics

There is much to celebrate in Minouche Shafik’s argument that we need a new social contract[1], not least a title that uses the language of obligation and duty rather than employing the language of rights.  This is even if she falls back, in her closing remarks, on answering her question of what it is that we owe to each, that it is “to muster the courage and sense of unity” that the Beveridge Report said was necessary for the “winning” of “freedom and want”.  I was looking for more, and shouldn’t be too critical her effort at a rallying cry to round off the book when she has addressed a variety of policy measures, without being unduly prescriptive about their precise form, that would address “our interdependencies, provide minimum protections to all, share some risks collectively and ask everyone to contribute as much as they can for as long as they can….investing in people and building a new system of risk sharing to increase our overall well-being”.

Shafik’s underlying argument is that we need a new social contract to meet the needs and opportunities facing both individual society and global society in the 21st century, including those of an environment threatened by global warming and the degradation from human activity, of an ageing population, of an inequity between generations, and of the alienation of communities left as others have prospered that as consequence poses a threat the liberal democracy.  She is qualified for this task by her  personal history which includes an affluent childhood in Egypt that exposed her to third world poverty around her before her family emigrated to the USA, a career largely “in the trenches of policymaking” spanning international institutions and in the central government and central banking in the UK, and finally her current appointment as Director of the London School of Economics in 2017 where she launched a programme of research, ‘Beveridge 2.00’, to rethink the welfare state.

Having spent many years in healthcare and the application of health economics, I felt initially that her chapter on health was skated over too much.  But this was before I reflected that the chapters outside my own area of knowledge were throwing me snippets of valuable information and new insights that left me with respect for the ambition within her 189 very readable pages (Thomas Piketty could learn a thing or two from Minouche Shafik!).  Plenty of the examples in this book are familiar, such as the marshmallow test, but others cited, such as the evidence of the value of quite modest investment in early years intervention, such as weekly hour-long visits by Jamaican community health workers for 2 years to encourage mothers to interact and play with their children to develop cognitive and personality skills that 20 years later yielded 42% higher earnings than the control group.

Shafik sensibly avoids too many narrowly defined prescriptions, reflecting on data presented in the book that different countries have successful applied different policy solutions (for example in how they fund and organise healthcare) to achieve broadly similar outcomes (even if the one nation in the case of healthcare that doesn’t do this in a coherent way – the United States – ends up spending far more in aggregate, and in terms of public money, than everywhere else only to realise worse outcomes).  However, the general thrust of her argument in each area of policy is clear.

Shafik poses interesting questions around the intergenerational social contract.  On one hand, younger generations are blessed with material well-being that the old generations could not have dreamt off.  On the other hand, as David Willetts documented in the The Pinch[2]the millennials and generation Z have good reason to be aggrieved as they pay for the higher education and the home ownership enjoyed by their parents appears out of reach.  Shafik recognises, in the emphasis that she places on investment in education in new social contract and various mechanisms for achieving this that she suggests.  There is also the issue of the price that they and future generations will pay in terms of the environmental degradation resulting from the previous generations’ approach to achieving their wellbeing and economic growth.  I am surprised at the complexity that she builds in to potential solutions to this when the solution should lie in regulation, a national income calculus that better reflects the value of the natural world that currently calculated GDP or national income, and environmentally based taxes that capture the externalities of industrial and agricultural activity that damages the environment.

The book also gives rise to a set of interesting questions about what this means for businesses.  Where do they sit within this narrative?  There are important lessons for the people who sit at the heart of businesses, the “controlling minds” in terms what they can do, both in relation to their own workforces, customers and suppliers, in terms of contribution to a new social contract.  For the business to thrive, and sustain itself in the long term, the core lesson is that it should be a player, alongside the individual citizen, in such a new social contract.  Otherwise, its profitability and in due course its survival will be undermined by the very same pressures the Shafik describes threatening both individuals and liberal democracy.

I have a fear about one element in the approach Shafik takes to the need for a new social contract.  This relates to what goes into the “increase in our overall well-being”.   Some of the steam that is driving populism is increasing material inequality and the sense that communities are being “left behind”.  Some of this populism is a function of identity politics, which may be whipped up by the perception that communities with other identities (often, but not exclusively, framed by other ethnicities or immigrant groups) are posing an economic threat or gain an advantage.  But the perception may nothing to do with actual material wellbeing.  Indeed, in the case of some of the 52% of the British population voting for Brexit, or the potential majority in Scotland for independence from the UK, this may be a desire to escape from or avoid the “other” despite the prospect that of material disadvantage.  Some may be seduced by arguments that “getting back control” will leave them better off materially, but many others take the view that independence from Europe or the UK is more important than the economic benefit of remaining part of the whole.  There is, at least at an abstract level, a link between the communitarian spirit in Shafik’s argument for a social contract “that addresses our interdependencies” and the desire to be part of a union, whether of states sharing a continent or Kingdoms sharing a small archipelago at the continent’s north western edge.  Those same people who resist the membership of the country they occupy in a union of countries are also likely to be those most resistant to her arguments for a renewed social contract.

[1] Shafik, Minouche (2021). What We Owe Each Other: A New Social Contract. ISBN 978-1847926272.

[2] Willetts, David (2010). The Pinch: How the Baby Boomers Took Their Children’s Future – And Why They Should Give It Back. ISBN 978-1848872318.

Not Useful but True – “the space is never static because the problem keeps changing all the time”

Nick Ormerod and Declan Donnellan
Nick Ormerod and Declan Donnellan

During lockdown, Declan Donnellan and Nick Ormerod, artistic directors of Cheek by Jowl[1] recorded a weekly podcast “Not True but Useful” about their approach to working in the theatre.  They have now released transcripts of the first series of stimulating conversations.  The following is an extract from the second of these podcasts “Space and Shakespeare”, published in April 2020[2].  I reproduce it here because I find the visualisation of the firm and the organisation as something existing in space, bounded by its interfaces (which are themselves dynamic) with outside world very helpful when thinking about the firm, what it is there for, and how people interacting with the firm or setting its strategy from inside.  Listening to Declan and Nick in conversation with interviewer Lucie Dawkins, I was struck by parallels between what happens to actors on stage and to the managers of the firm.

Lucie   So, today we’re going to focus on the way that you think about space when you stage your plays together, both in terms of what it means for the actors, and how it influences your design. And later in the episode, we’re going to use Measure for Measure as a test case, and I suspect we’ll probably talk a bit about Macbeth as we go along. But let’s start at the very beginning. Why is space so important to you?

Declan   It’s very difficult to explain what we mean by space. I can put it in this form, I can say that what happens when we die? When we die, the space gets taken away from us. So the space is an enormous thing.

Lucie   So what has space got to do with acting?

Declan   Everything. It’s got to do with our whole existence.

Nick  Human beings live in space. They’ve spent their lives dealing with the space, they are formed by the space, everything. The character (Macbeth, for example) lives in a space, a changing space from second to second. Each character has their own special space. And it’s very subjective. You look at a chair, perhaps your mother sat in that chair, that chair means something to you in your bedroom. The character deals with the space. And we as human beings spend our lives dealing with a space.

Declan  Yes, sometimes it’s a criticism, a lot of people say, oh, you know, ‘he’s at the centre of the universe. He thinks he’s the centre of the universe.’ And of course, it’s very annoying if somebody’s self-obsessed like that. But unfortunately, we are at the centre of our own universes. We invent the world that we see. There is a reality, I’m sure, but we have no access to that reality other than through our imaginations. Nick and I are looking at a microphone now but we’ll see different microphones. The microphones we see we have to invent somehow in our heads. One can’t explain these things, but we can get used to these ideas. And we can say things about the space, which is different from defining it.

Lucie  How does the space influence the behaviour of a character, for example?

Declan  Well, there would be no character if there were no space. And the thing is that, in a mysterious way, we are not independent of the space, we only exist as part of this big binary. And that’s the very hard thing to get one’s head around.

Lucie   That’s a striking statement, that there’s no character without the space around them. So, let’s unpack that a bit. How, for example, does the space define Macbeth in the scene we talked about last week, Act 1 Scene 7, when he leaves the dinner party in the next room offstage to talk to the audience about why he wants to kill Duncan.

Declan  I think that first we shouldn’t in any way have the idea that space is something that only afflicts Shakespearean characters. You know, Nick and I are sort of hunched over a microphone and we’re looking at your face, and we’ve the laptop open, and I’m trying to not make noise on the table. And I’m pinned in space.

For Macbeth, there’s a million different ways of doing it, but the space will be central to all of them. There is no world, there’s no life beyond the space. The space is what gets taken away from us when we die, and death is what happens when the space gets taken away. Macbeth gets the feeling that he has to leave that table. Yes, we can interpret the stakes: because he feels suffocated; because there’s no air in the room; because he has to get away from the man he is murdering; he needs space to think – and he comes out, and maybe doesn’t want to speak to anybody, and maybe he sees us, and there are all sorts of stories that one might evolve in order for him to do that. But whatever solutions he comes up with, these will all be absolutely dependent on the space, and on him allowing that space to come before he does. That is the important thing. So it’s not me and I spray a space around me – it’s that is a space and I’m in it. I try to control that space. And so I imagine it to be all sorts of things other than it is. But it’s going to be there before me, during me, and after me, and my perception of it will be continually changing.

If we need to break it down into steps, we can say – it’s a bit leaden – but if we run into difficulty, we can say that one of the shapes of life is that I’m in a space, I have an impulse to cross a threshold to go to another space to find something which turns out to be different from what I had expected. And that last one gives us life, the fact that it’s a continual surprise. When we look at any space, we see it’s just one long transition from one space to another. There is no state of a space, the space itself is transitioning, and we are normally trying to keep up with that space that’s changing much faster than is comfortable for us. It’s like, you know, we think that the world is spinning too slowly. Actually it’s spinning uncomfortably fast. And in all of these plays, events run out of control, and that they’re trying to slow things down. It’s rather sad to say to actors, you know, you must drive the play, because actually the space, the thresholds, the predicament, drives the action. And the characters are struggling to keep running with this thing that’s running wild and out of control.

Lucie   So, one way of looking at what’s driving this character through the space is that there’s a problem in one space, it drives them into another space, but the new space only keeps presenting him with more problems – that the character’s journey through the scene is dealing with the problems that the space is serving up to them.

Declan   That’s exactly right. Yes, the space is never what he wants it to be. The space keeps presenting new challenges. And we all think, oh wait, if only the threshold changing would stop, if only the carousel would stop, then I can deal with it – if only it would stop! But it doesn’t. It just keeps going. And there we are. And that’s what we do. And yes, he’s continually dealing with the new things that he sees.

Lucie   So it sounds like the space is never static because the problem keeps changing all the time. I guess the longer he’s out of dinner, the more he realises that he’s going to be missed, and it looks suspicious, and the bigger his problems keep getting, and every face that he speaks to in the audience presents another source of discomfort, as if he’s trying to persuade each one that the murder is a great idea. So the space is always changing, either serving up new problems or letting the existing ones grow worse.


[1] I have been one of Cheek by Jowl’s patrons for many years, having enjoyed their shows for most of my adult life and almost certainly seen performances involving Declan and Nick in my first year at student at Cambridge University in the 1970s.

[2] Full recordings and transcript available at Not True, But Useful Podcast – Cheek by Jowl