The Foundation Myth

In Isaac Asimov’s Foundation series, every time the situation seems darkest, a brilliant leader will come up with an amazing plan that completely changes the terms of engagement and saves the day. Victory is snatched from the jaws of defeat and the Foundation moves on, to fulfil its manifest destiny.

It’s a great story, and an appealing narrative, that echoes with how we think of much of our own history. But how well does it really stand up in reality? Can we count on leaders to do the right thing, when their backs are finally against a wall? And what if they don’t?

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To be fair to Asimov, in the books, this doesn’t happen automatically, or out of some magical power of believers. It happens because Hari Seldon has spend years working with a team of advanced mathematicians and sociologists to develop ‘psychohistory’, allowing him to mathematically predict the large scale movement of history based on initial conditions, and then carefully set up those initial conditions in such a way as to allow the Foundation to prosper. Even when a brilliant leader doesn’t come up with the perfect idea, the Foundation wins, though in Second Foundation, thousands of spaceships and hundreds and thousands of men are lost before the Foundation prevails.

For that matter, later books reveal that even the psychohistorical predictions aren’t perfect, and that (ROT13) gurer vf n frperg Frpbaq Sbhaqngvba bs gryrcnguf jub vagreirar ng xrl cbvagf gb xrrc uvfgbel zbivat nf vg fubhyq.

What makes it so compelling – other than Asimov’s mastery of plot – is that this trope, of being driven to the wall and, at the last minute, snatching victory from defeat, echoes with the visualisation of how we think of our own history. Think Agincourt; Trafalgar; the Spanish Armada; Dunkirk and the Battle of Britain; or, going back further, the Battle of Tours; or Thermopylae and Salamis. US history and culture, of course, draws heavily on its British and classical heritage, but in its own right it can draw on examples in the War of Independence or, in World War 2, the debacle at Pearl Harbour followed by ultimate triumph.

Never mind that many wars or struggles were not like this. Many of the stories we like best are not one of evenly matched struggles, or of us marching ever onwards and upwards in glorious strength, but of the plucky underdog, its back pressed to the wall, who reaches deep to pull off a victory against the odds. If it can be achieved by cleverness as well, so much the better (think radar or the Enigma Project in the Second World War).

We see this narrative outside of warfare, also. In the Space Race, the USA was caught flatfooted and unprepared by the launch of Sputnik. Taken by surprise, it rallied, revitalised its education programme, committed itself to high ambition in Kennedy’s landmark speech, and did indeed succeed in, “before this decade is out, of landing a man on the moon and returning him safely to the earth.” In fiction, we see it repeated in story after story, regardless of medium: the squabbling, ineffective or otherwise flawed protagonists, facing oblivion or defeat, at the 11th hour set aside their differences, get their act in gear and triumph.

Of course, the historical incidents set out above are fundamentally true. No doubt one reason this forms part of our self-image is that, in addition to them being good stories, British – and American – history does genuinely have a relatively high number of occasions where the odds were against us, and yet we pulled it together in time to triumph against adversity. Neither country has been conquered for a long time – for Britain, not for nearly a thousand years; for the USA, not since its formation, which inevitably means that we prevailed when things went badly. And yet, compelling and true as these stories are, even for Britain and America, there are many other episodes in history that do not neatly fit into this narrative. And for other countries and cultures, even for very successful ones, this will be even less the case.

I was struck when I read Cixin Liu’s The Three Body Problem how different it was from this. The view of future history portrayed here seemed much more to depict humanity and its nations muddling along, repeatedly making bad mistakes and undergoing long periods of suffering and decline – sometimes for decades, with billions of people dying – before coming out the other side, somehow stronger than before. Not having read that much Chinese literature, it’s hard to tell whether this is a genuinely Chinese perspective, or simply a Cixin Liu perspective, but it certainly seems to align with recent Chinese history.

The truth is, the Foundation Myth is false. There is no guarantee of success or survival at the last moment. Rome fell. So did Byzantium – and, unlike Rome, the civilisation and culture over which it presided is almost completely obliterated. Countless nations conquered by the Assyrians and Babylonians were taken into exile and vanished from history – the Jews being a rare exception who didn’t. As colonial empires expanded, playing divide-and-rule as they did so, again and again local kingdoms and tribes were unable to set aside their differences, and fell to the invaders. Many cultures, languages and religions have, throughout history, vanished without trace.

Nor is the story any different on less consequential matters. Nero, famously, fiddled while Rome burned(1). The Polish-Lithuanian Commonwealth, with political governance mechanisms that had once been enlightened and advanced, but increasingly became sclerotic and unable to keep pace with its rivals, ultimately failed and disintegrated. So, under different circumstances, did the Ottoman and Austro-Hungarian empires. Rome fell not under an onslaught of barbarians sweeping over the walls, but through a weaking civic fabric and repeated civil wars – at any point until very near the end, Rome could have outfought its enemies in terms of raw power, but lacked the state and organisational capacity and trust to do so.

Of course, sometimes it does happen. The Jewish people, after two millennia of exile and persecution, culminating in the horrors of the Holocaust, against all the odds, founded and defended the independent nation of Israel. After two centuries of self-imposed isolation and stagnation, humiliation by Commodore Perry’s ships precipitated the Meiji restoration, one of the most formidable modernisations ever(2), culminating in the defeat of Russia just fifty years later – and their presence today, despite the disaster of the Second World War, as still one of the most economically and technologically developed nations in the world. But this is the exception, rather than the rule. It doesn’t just happen – the middle-income trap is real.

A hundred years ago, Argentina was numbered in the first tier of nations. ‘In 1913, it was richer than France or Germany, almost twice as prosperous as Spain, and its per capita GDP was almost as high as that of Canada. If you walk through the Foreign Office in Whitehall, you can see Argentina depicted as one of the major nations in illustrations of conferences, or of the world powers, from the first decades of the 20th century. It took part (with Brazil and Chile) in a race to acquire the most dreadnoughts in South America. There is no reason, other than contingent history, why it should not be counted today alongside Canada, Australia or other developed nations. Instead, it has a GDP per capita of just over $10,000, only a fifth of that of Canada’s. There was no single disaster responsible for this decline. Rather it was a repeated succession of sub-optimal choices, failures to reform, coups, turmoil and more – none of it inevitable, none of it individually fatal, but cumulatively devastating.

It’s comforting when we look at the failure of politicians to grip serious matters – the steadily increasing price of houses, or our creaking infrastructure, or the increasing unavailability of affordable childcare – to think, reassuringly, that after all, once it gets bad enough, someone will act. After all, that’s what’s always happened before, hasn’t it? We might have had to endure a decade or so of pain first, but whether it was cleaning up the foul air in Victorian London, or the reforms that took Britain from ‘the sick man of Europe’ to the prosperity of the 90s and 00s, when things became bad enough, someone did something.

But the lesson of other countries is that we should not count on this. As Martin Wolf writes in the Financial Times, “The UK’s future depends on improving economic performance. Unfortunately politicians remain unable to offer a plausible account of how this can be achieved.”

We’ve now had 15 years of stagnation. According to the IMF’s latest data, real gross domestic product per head in the UK rose by a mere 6 per cent between 2008 and 2022. This was the second worst performance in the G7, above Italy’s. To put this in context, UK real GDP per head rose by an impressive 33 per cent in the 14 years to 2008. Yes, there have been a large number of global events buffering us in that time – but other nations have done much better.

GDP per capita in $thousand (World Bank data)

In 2008, the USA, Germany, UK and Australia were all bunched together. Now, the USA and Australia have pulled clearly ahead – with Ireland shooting up the y-axis as if there were no tomorrow. Even Poland is closing the gap, from being 3.3 times as poor, to only 2.5 times as poor. Only Germany, like us, is muddling along in the middle. To put concretely what that means, in 2008, someone emigrating from the UK to Australia would have been going to a country no richer or poorer (albeit one with better beaches). Now, that same person emigrating would be going to a country a third richer again. Imagine if you were suddenly earning a third more money. That’s roughly what’s happened to the difference between Britain and Australia over the last fifteen years.

Throughout this period – and, indeed, the decade before – we’ve been steadily increasing taxation as a share of GDP, increasing regulation in both the public and private sector in almost all areas, and increasing the amount of paperwork it takes to do almost anything. All things which are notably not conducive to creating economic growth. Through this period, the Opposition has consistently said we should spend more, regulate more and opposed any attempt to reduce bureaucracy. As Wolf says, politics doesn’t currently seem to be delivering the answers.

Every mainstream political party is committed to Net Zero. It has widespread public support. Yet to get permission to build an offshore wind farm, developers often submit over a thousand documents including a 10,000 plus page environmental impact assessment – and still often face legal challenge. It doesn’t have to take 12 years to build a wind farm in Britain – yet it does. Last time Government tried to do something about this, large numbers of charities accused it of ‘declaring an attack on nature‘. Similarly, childcare costs are a major issue for many parents – and for every taxpayer, given the degree of government subsidy – yet over the last decade, we’ve driven half of childminders out of business through increasingly onerous inspections and regulation. The availability and affordability of childcare is a major issue – yet no-one is willing to take on the powerful lobbyists and actually make it easier childminders to go about their business.

This is not a single party issue. Since 1997, we’ve failed to build new nuclear power plants or new reservoirs. Under Labour, the Coalition and the Conservatives, we’ve consistently failed to build anywhere near enough new houses to keep pace with new household formation. We’ve cut investment in further education – down by two-thirds since 2003. The UK’s investment in capital – by Government and business is well below peer nations – a problem, since capital formation is one of the principal routes to long-term economic growth. This has continued under Prime Ministers generally considered to be effective, even outside their party – Blair, Cameron – as well as those generally considered to be less so. No-one is willing to confront and address the really difficult issues.

Oh, but surely when it gets bad enough, they will – won’t they?

Last year we had an energy crisis. Energy prices more than doubled over the course of a year, putting tremendous pressure on households and business. Did we, as a nation, respond by making it meaningfully quicker and easier to build energy infrastructure? Slashing the time to build offshore wind, building onshore and actually breaking ground on new nuclear plants? No. Did we increase capital investment, as the USA has done through the Inflation Reduction Act, hosing billions at capital projects? No. Instead, we spent a phenomenal amount of money – c. £70bn, or about half the cost of running the NHS for a year – on consumer subsidies. Now, that’s not to say that some consumer subsidies weren’t necessary: but it’s notable that they were the only bit – the easy bit – that saw action. The others didn’t. Rather like when Liz Truss was able to say which taxes she would cut, but not which bits of spending to go with it.

Sky-high house prices haven’t resulted in housebuilding. A crisis in childcare availability and affordability hasn’t resulted in any reduction in the regulation that is driving childminders out of business. An energy crisis – and a (genuine, I believe) national commitment to Net Zero hasn’t sped up energy investment. Ongoing calls by business for more skills hasn’t seen meaningful increased investment in further education and skills. In every case, it is to difficult to take on the vested interests, and easier to tinker, delay – and kick the decision down the road. Bread and circuses today, and let the future go hang.

We cannot count on the Foundation Myth to save us. Despite its long and successful history, Britain has no God-given right to be a wealthy nation. The 20th century saw the end of empire and the decline of Britain as a first rate international power. Will the 21st see its decline as an economic power, and its diminishing into a middle-income nation?

I hope not. I trust not. There is still time for reform – and great strengths on which to build. But we cannot take this for granted, or assume it will still just happen. We have been on this path for many years now. If Britain is to change its current trajectory, we need leaders bold enough and willing to take the right decisions, the difficult decisions, not just for today or tomorrow, but for ten or twenty years’ time.

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(1) Unless he didn’t.

(2) Singapore being the only potential rival.