Oliver Kamm

Arafat's financial stewardship

On Yassir Arafat's death I wrote:

Arafat was duplicitous and untrustworthy. Instead of abjuring violence he fomented it. Instead of governing wisely and well in preparation for statehood, he exercised arbitrary power and exhibited relentless cupidity. No agreement signed by Arafat could have been made to stick. His people were greatly the poorer for having been misrepresented and misruled by him; they urgently require better leadership on his passing.

I was of course being generous to the recently-deceased. Arafat's extraordinary financial mismanagement extended beyond personal corruption. A story has come up on the Bloomberg financial information service this morning that is the most detailed account of his fecklessness that I have seen. It appears that donor money intended for services and infrastructure in the Palestinian Authority was devoted also to speculative schemes divorced from both Palestinian interests and the principles of efficient investment management. Through the incompetence and profligacy of an unaccountable leader, the Palestinian Authority lost millions of dollars by taking large and illiquid positions in software and telecommunications companies in the late 1990s:

Arafat used a holding company to buy stakes that ranged from $285 million in Egyptian mobile-phone company Orascom Telecom Holding SAE and its affiliates to some $30 million in private equity, mostly in the U.S. These included $3.2 million in Herndon, Virginia-based Simplexity Inc., which makes electronic-commerce software, $2.1 million in New York- and Boston-based Vaultus Inc., which makes software for wireless computers, and $1.3 million in New York-based Strike Holdings LLC, which owns the Bowlmor Lanes bowling alley in Manhattan's Greenwich Village.

Arafat, who died on Nov. 11 at age 75, disclosed $799 million of investments in documents the Palestinian Authority has released over the past two years that show he didn't just invest in building basic services in the West Bank and Gaza.

At a time when the authority was starved for funds, Arafat's money managers placed bets from Tel Aviv to Silicon Valley on venture capital funds, software startups and telecommunications companies.

President Bush has been much-criticised for his insistence on political reform in the Palestinian Authority as a prerequisite of a Middle East peace settlement. His position seems to me simple common sense as well as unexceptionable liberal principle. Apart from any other reasons, financial mismanagement and corruption are often accompaniments of autocracy. Personal ascetism and financial probity are not values encouraged by the exercise of arbitrary power. (Perhaps Stalin and Ho Chi Minh lived as frugally as their apologists claim; Saddam Hussein and Robert Mugabe certainly haven't.)

I served for some years as a trustee of a pension fund about as large in total as a single one of Arafat's private-equity holdings. I can only say that if I and my fellow-trustees, in the regulated and democratic UK system, had discharged our fiduciary responsibilities as Arafat did his, I should probably be writing this post in somewhat less comfortable and more constrained circumstances than I am used to.

What is...'Collective Wisdom?'

This column appears in The Times today.

THE REPUTATION of exit polls was perceptibly if unfairly damaged by the US presidential election. But, as a writer in Fortune magazine points out, another predictor was unambiguously accurate. This was the electronic predictions market: the various websites allowing punters to place bets on the electoral outcome.

It was no fluke. An exchange in which many people try to outguess each other, each having a financial stake in the outcome, is difficult to beat. It exemplifies a phenomenon referred to on this page yesterday by Peter Riddell as the “wisdom of crowds”, after a book of that title by James Surowiecki, a New Yorker columnist.

Large groups are often castigated as irrational, conformist, pliable or atavistic. “How can 59,017,382 people be so DUMB?” ran a recent headline in the Daily Mirror. Knowledge, in its view, comes to those platonic guardians — the Mirror presumably included — who reflect hard and well enough on a problem.

A liberal society does not work like this. Knowledge is a process, not an outcome. The process is a critical exchange of views among the uninterested and the indolent as well as the educated and informed, yielding a collective wisdom. The evidence is that it works. This is because some problems have no predetermined set of solutions waiting to be discovered: continual experiment, rather than rational consideration of all the options and the selection of an ideal, is necessary. Experimenting is messy. It generates numerous possible choices, most of which are swiftly dismissed.

Take the stock market. It contains informed investors but also innumerable traders on sentiment and superstition. Even many professionals rely on an irrational forecasting technique known as “chartism”, the study of patterns in price charts (as opposed to tealeaves or the constellation of planets, which would make quite as much sense). Stock markets have periodic bubbles and crashes. Yet economies with liquid financial markets invariably turn out to be better at allocating scarce resources to productive uses than bureaucratic command economies.

Collective wisdom was invoked last year in the well-publicised (and swiftly aborted) Pentagon plan to create a futures market that would allow speculators to bet on the likelihood of terrorist attacks. The plan was unworkable. A market where a few people possess highly accurate information which is unavailable to other traders is easily manipulated. Terrorists could have spread false information by betting on incorrect outcomes.

But ideas that get killed are a path to wisdom. Their rejection ensures that the search for understanding flows into new tributaries. A liberal culture, informed by the collective wisdom, is continually seeking, whereas theocratic absolutists already know. That gives us the advantage.

Divided by a common history

If a British newspaper were to run a leader reflecting on the political record of President Harry S. Trueman, it would justifiably be accused of ignorance and incompetence. I fear similar strictures apply to the Wall Street Journal for its leader today, on the recent story about a survey of academics on the ranking of 20th-century UK prime ministers, entitled Atlee Defeats Churchill. Attlee was not a political leader of the highest rank - which is to say he was not Churchill, just as Truman was not Roosevelt - but he was a very good leader of historic importance nonetheless. It's unfortunate for us Europeans who strongly support the Atlantic alliance if a leading US newspaper goes on record (and throughout the article) with an inability to get his name right.

The full results of the MORI/University of Leeds survey are here. They put Attlee first, followed by Churchill, Lloyd George, Mrs Thatcher, Macmillan and Blair. The Journal comments caustically of the first two names:

In itself it's hardly surprising that a group so composed [i.e. academics] would choose the triumph of socialism instead of the triumph over National Socialism as the defining achievement of Britain's 20th-century leaders. But it's worth remembering that without the latter they never would have gotten the former. Churchill is, after all, one of the reasons Britain has a National Health Service instead of a Nationale Gesundheitsdienst.

I grant that it's wrong that Churchill should be in second place, but it does the Journal no credit to leap to conclusions about the respondents' political bias from the survey's results. Churchill saved Western civilisation from barbarism, which is why any survey of British Prime Ministers must put him first - but it is at least possible that the academics were more swayed by Churchill's poor peacetime premiership of 1951-55 than by any inferred Labour leanings.

Otherwise the survey's results are questionable but not perverse. Attlee - like Truman - was economically unsuccessful, but historically vital in his contribution to the formation of the Nato alliance and the construction of the post-war order of collective security. Without it, Eastern Europe would probably still be under totalitarianism, and Western Europe might also be. Lloyd George is correctly placed for his wartime leadership and social reforms. Mrs Thatcher is rightly acknowledged; she was important in pursuing the Cold War at a time when the Left in Britain and much of the rest of Europe had forgotten its own contribution to that noble cause. I am not convinced that she was responsible for an economic renaissance in Britain - the experience of monetary and then exchange-rate targeting was consistently unsuccessful - but she certainly reformed and democratised industrial relations in a way that was crucial to the more recent record of low-inflationary growth. It is too soon to judge Blair's record as PM, but sixth place at a minimum is a reasonable position given his dominance of the party system and his record on foreign affairs (which I count excellent).

Macmillan seems to me overrated, but worth a reasonably high position if only on grounds of his reading of the 'winds of change' and decolonisation. Baldwin is too high, though his admirers would claim (with reason) that political sentiment at the time would always have prevented him from rearming against the gathering storm of Nazism. Callaghan and Ramsay Macdonald both merit higher positions on grounds of economic management. John Major ought to be last but two (beating only Chamberlain and Eden) in any such poll: manifestly unsuited by temperament for the office, he presided over the foreign-policy disaster of Bosnia with uninterest and incompetence.

What is...'proactive translatology'?

This column appears in The Times today.

ALL SCHOLARLY disciplines have jargon. Specialist terms are mocked by populists, but they can be a useful shorthand. They are not a target of this series on buzzwords.

Deliberate obscurity cultivated for the appearance of profundity is another matter. The attractions of obscurity are beautifully depicted in Malcolm Bradbury’s comic novel The History Man. Annie Callendar, lecturer in English literature, explains to the radical sociologist Howard Kirk how she approaches her subject.

“I read books and talk to people about them,” she says. “Without a method?” asks Howard. “That’s right,” she says. “It doesn’t sound very convincing,” says Howard.

I thought of this exchange when considering an international symposium to be held next April at the University of Montreal under the felicitous title For a Proactive Translatology.

Translatology is the study of translation. Proactive is a gruesome synonym for anticipatory. Of this pseudoscholarly gobbledegook, one leading literary translator remarked despairingly that her own work required no proactive translatology beyond the aim of serving foreign authors and English-language readers as well as possible.

On the evidence of this symposium at least, proactive translatology is less about translation than the proffering of political opinions by those whose training is in languages. As the conference organisers declare ominously: “Discoursal practice implies social commitment. Can/should translatology and terminology be considered in abstraction? How should this commitment be addressed?”

“Discoursal practice” (ie, talking) of course reflects the world in which it takes place, where politics is ubiquitous. It is because we all have our own social assumptions that the study of language, as with all other fields of scholarship, must not imply social commitment. It should instead be a field of disinterested critical inquiry and the pursuit of knowledge independent of the political assumptions of its practitioners. Academic fields in which almost everyone holds the same political views are notorious for allowing the politics to supersede the scholarship.

Proactive translatology is promoted in Britain by Mona Baker, editor of a journal called The Translator. A couple of years ago Professor Baker peremptorily sacked two left-wing Israeli academics from the board of her publication on the sole ground of their nationality. Her perplexity at the outrage she generated was unforced, even understandable. An academic boycott of Israel is a vogue cause; Professor Baker merely demonstrated its arbitrarily persecutory character by pursuing it consistently. If you propose your field of study as a vehicle for ideological warfare, academic gobbledegook is quite useful for disguising the fact.

UPDATE: This one, I'm gratified to report, hit the spot. Professor Baker sent round a message to members of her 'Translation' mailing list on the morning of publication with the text of the column and her annotation:

This is a hilarious example of the political and scholarly sophistication of the media. Naturally, unlike those horrible scholars of translation, they themselves are totally unbiased! And of course very very accurate in their description of the issues!!!

While I don't share Professor Baker's predilection for redundant exclamation marks, I must say I find myself entirely in agreement with her remarks.