December 8, 2021

Two years on from the general election, we still don’t know how the Tories intend to build back better.

Dominic Cummings had a pretty good idea of what needs to be done, but he’s long gone. And now Gove’s white paper on the levelling-up agenda has been delayed. Two big speeches from the Prime Minister this year were supposed to flesh out the agenda, but the first was a let-down and the second a major embarrassment.

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The only hint of a guiding principle came in a third — Boris Johnson’s crowdpleaser at the Conservative Party conference. Here’s the key passage: “If you insist on the economic theory behind levelling-up it is contained in the insight of Wilfredo Pareto… that there are all kinds of improvements you can make to people’s lives he said without diminishing anyone else… we call these Pareto improvements.”

Why was the PM referring to a 19th century Italian economist? He claimed at the time that Pareto had merely “floated from the cobwebbed attic of my memories”. But I’m not so sure. I suspect he is foundational to Johnson’s entire political outlook.

Vilfredo Pareto was born in 1848 to an Italian father and a French mother. He trained as a civil engineer, but in mid-life switched to an academic career — in which he shaped the modern disciplines of economics and sociology. His theories are complex and contradictory. But paradoxically they’re also accessible through bite-size concepts such as Pareto improvements (see above), Pareto efficiency and, most famously, the Pareto principle. 

This last one is also known as the 80-20 rule. It’s the idea that, in many situations, 80% of the consequences come from only 20% of the causes. This has been expressed in all sort of ways ever since — including the half-joke than in any organisation 20% of the people do 80% of the useful work. Pareto claimed that this basic pattern could be seen everywhere, which is why he thought that human society is naturally hierarchical. 

He also taught Benito Mussolini. Pareto was professor at Lausanne University when the future Italian dictator was a student there. The young Mussolini was a socialist, but after rejecting the principle of egalitarianism he gravitated towards fascism instead. And for that ideological metamorphosis, Pareto’s influence has been blamed.

The professor was not himself a fascist, but he did believe that inequalities — of wealth, power and achievement — were inevitable. While one might seek to order society for the benefit of “the many not the few”, hierarchy will always be the result if the few make most of the difference.

For Pareto, this didn’t have to be a problem. As long as the most capable individuals are in charge, then in theory everyone benefits. If this sounds like elitism — then that’s because it literally is. Pareto coined the word. He wanted an alternative to the Marxist concept of class, which he thought too restrictive, so chose the French word élite — which means “selected” or “chosen”. 

How strange, then, that Boris Johnson — supposedly to be a populist — should have taken the father of elitism as his inspiration. But, of course, Boris is an elitist himself. He made that clear when he delivered the 2013 Margaret Thatcher Lecture at the Centre for Policy Studies. Up against some pretty stiff competition, it’s the most controversial speech he’s ever given. 

At first sight it looks like a simplistic Rightwing defence of inequality. “I don’t believe that economic equality is possible”, he said, “indeed, some measure of inequality is essential for the spirit of envy and keeping up with the Joneses that is, like greed, a valuable spur to economic activity.”

Johnson also compared the economy to a box of cereal: “the harder you shake the pack, the easier it will be for some cornflakes to get to the top.” This alludes to a physical phenomenon called granular convection that explains why the largest particles in a granular material rise to the surface, while the smaller ones collect at the bottom. Like Pareto before him, Johnson was arguing that inevitable forces are at work in human society too — and that these produce inequality: “the income gap between the top cornflakes and the bottom cornflakes is getting wider than ever”. 

The speech was met with outrage. Nick Clegg, Deputy Prime Minister at the time, described it as “unpleasant, careless elitism.”

However, it is worth pointing out that Boris wasn’t arguing for a static, unchanging hierarchy: “To get back to my cornflake packet, I worry that there are too many cornflakes who aren’t being given a good enough chance to rustle and hustle their way to the top.” It was time, he said, to give the packet another shake — just like in the Sixties or as Margaret Thatcher did in the Eighties. 

This appears to owe a lot to another one of Pareto’s theories: the “circulation of elites“. Instead of comparing society to a box of cereal, the Italian likened the governing elite to a river:  “What it is today is different from what it was yesterday. Every so often, there are sudden and violent disturbances. The river floods and breaks its banks. Then afterwards, the new governing elite resume again and slow process of self-transformation.”

Though Pareto believed in elites — he also recognised their tendency to stagnate over time. Their members come to owe the positions not to ability, but just because they are seen as superior. Furthermore, they use their position to put obstacles in the way of those who might compete with them. Social tensions build until the point at which outsiders of greater ability rise up to overthrow the old establishment — and thus become the new elite. And so the cycle starts again. “History is a graveyard of aristocracies,” is how he summed it up. 

The obvious parallels between Johnson’s cornflake packet and Pareto’s river might be a complete coincidence — but I doubt it. If Pareto’s ideas have a place in the attic of Johnson’s mind, it’s because he wants to keep hold of them. 

Certainly, the Prime Minister has lived out those ideas. He is both an elitist to his very finger tips, but also a populist overthrower of establishments. David Cameron and Theresa May can both attest to his cornflake shaking abilities — as can the European Union. 

But what now? Any further delay to the levelling-up strategy would suggest that the new elite — comprising Boris Johnson and his remaining allies — is also succumbing to a process of stagnation. To rescue his flagship policy, the Prime Minister must either force a lot more money out of Rishi Sunak or he must offer something just as valuable in its place: and that is power. 

There was a taste of what might be to come, when Michael Gove proposed the introduction of US-style governors to lead England’s counties. If this more than a gimmick, then we’re talking about an unprecedented devolution of power from Whitehall to local communities. 

Perhaps Boris Johnson hasn’t finished shaking things up.