Rory Sutherland

For the past 12 years, Roger Alton and I have shared this half page like Box and Cox: he writes fortnightly about sport and I write fortnightly about technology. Normally it would be Roger’s turn this week to cover sport. Unfortunately there isn’t any. So we’ve reached an agreement. For now, while there’s no longer any sport, I may write a little more frequently about technology. Then, in six months’ time, if there’s no longer any technology, Roger can write more frequently about the newly popular sports: bare-knuckle pugilism, dog-fighting and Mad Max-style steel-cage jousting. He could even throw in some nostalgic pieces recalling the golden age of football, when fans could still afford to throw toilet rolls on to the pitch.

It wasn’t a coincidence that the US government chose Ellis Island as an immigration station. The crucial word is ‘island’. Had the RMS Titanic missed that fateful iceberg in 1912, she would eventually have taken up station at a quarantine area at the entrance to the Lower Bay of New York Harbor, to await medical inspectors who would board the ship from a cutter. The quarantine exam would have been performed aboard, but only for first- or second-class passengers (US citizens were exempt). These would have been inspected for cholera, plague, smallpox, typhoid fever, yellow fever, scarlet fever, measles and diphtheria. A few might have been marked to be sent to Ellis Island for further examination.

A consensus seems to be forming that the BBC licence fee is for the chop. In a digital age, the reasoning goes, we should not be forced to subscribe to huge bundles of content, with no choice over what we pay for and what we don’t. This argument, intriguingly, is both true and false at the same time. It is worth remarking that Netflix and Spotify succeeded by adopting a very similar model to, er, the BBC What’s true is that technology has removed two constraints which made the licence fee necessary in the first place. At the BBC’s outset, the airwaves were limited, creating a monopoly. Moreover it was impossible to charge for specific content: anyone with a wireless set could freely enjoy anything on air. Other than advertising, a licence was the only option.

In the recent debate over Britain’s 5G infrastructure, one dog didn’t bark in the night. At no point did anyone dare suggest that, regardless of the supplier, upgrading our mobile networks to 5G might be premature. In saner parts of the economy, an investment requires something called a ‘use case’ or a cost-benefit analysis. In other words, you need to provide some immediate benefits which will arise as a result of your investment. Anything that can be dressed up as next-generation technology is somehow spared that tedious level of scrutiny. All it takes is for the techno-consulting complex to claim that ‘without this we risk being left behind’ and next thing you know there’s a blank cheque.

Some years ago, two British supermarket chains needed to place a large order for replacement trollies. They had to decide what ratio of full-depth and shallow trollies to order, and how best to allocate them between stores. One of them amassed mounds of demographic data and tried to construct an elaborate optimisation model. The second took a different approach: ‘We already employ people to collect trollies in the car parks — so why don’t we ring them and ask what they need?’ The second approach worked much better. How often are problems best solved not centrally but by devolving decisions to people on the ground? How often are problems best solved not centrally but by devolving decisions to people on the ground?

Outside mathematics, the word ‘commute’ can mean two things. Mostly it refers to the act of making a daily journey between one’s home and work; more rarely it describes replacing one penalty with another — as in ‘the Home Secretary commuted the death sentence to one of life imprisonment’. The curious may wonder why one verb is used in two different ways. The reason is intriguing. In the early days of rail travel, workers in Chicago could ‘commute’ the cost of a daily rail ticket into a lower price per journey by buying an annual, or ‘commutation’ ticket. The word commuting originally referred to the act of reducing your ticket cost, then later came to denote the resulting travel.

In 1891, a 29-year-old man moved from Philadelphia to Chicago intending to start a business. With $32 to his name, he began by selling scouring soap. Hoping to boost sales, he gave away small packets of baking powder with every purchase. Soon he found that the baking powder was more popular than his soap, so he quit the soap market and started selling baking powder instead. But now he needed something to give away with his baking powder. Eventually, for reasons I cannot begin to fathom, he took to giving his customers two free packs of chewing gum with each tin of baking powder. And then the same damned thing happened again. He found that the free gum was more popular than the baking powder.

Recently I suggested a new approach to commuter-train overcrowding. It simply involved reformulating the problem by accepting that not all overcrowding is equally bad: 100 people forced to stand 10 per cent of the time do not experience anything like the same irritation as ten people who have to stand 100 per cent of the time. So my suggestion was that a proportion of peak-time train seating — even a few peak-time trains — should be reserved for annual season ticket holders. But when I mentioned this to a group of engineers, one pointed out something that hadn’t occurred to me: ‘Airlines already do that.’ ‘They do?’ ‘Well, airlines don’t have season tickets, but they do have frequent flier programmes.

Today we suffer disillusion, not because we are poorer than we were — on the contrary, even today we enjoy, in Great Britain at least, a higher standard of life than at any previous period — but because other values seem to have been sacrificed and because they seem to have been sacrificed unnecessarily, inasmuch as our economic system is not, in fact, enabling us to exploit to the utmost the possibilities for economic wealth afforded by the progress of our technique, leading us to feel that we might as well have used up the margin in more satisfying ways. If you finished that paragraph and thought ‘Gosh, Sutherland has really nailed the contemporary malaise’, you are probably right. Except for two things.