Beware those Black Swans

The bestselling economist Nassim Nicholas Taleb argues that we can’t make the world financial system

After completing my book The Black Swan, I spent some time meditating on the fragility of systems with the illusion of stability. This convinced me that the banking system was the mother of all accidents waiting to happen. I explained in the book that the best teachers of wisdom are the eldest, because they may have picked up invisible tricks that are absent from our epistemic routines and which help them survive in a world more complex than the one we think we understand. So being old implies a higher degree of resistance to "Black Swans" (events with the following three attributes: they lie outside the realm of regular expectations; they carry an extreme impact; and human nature makes us concoct explanations for their occurrence after the fact).

Take Mother Nature, which is clearly a complex system, with webs of interdependence, non-linearities and a robust ecology (otherwise it would have blown up a long time ago). It is a very old person with an impeccable memory. Mother Nature does not develop Alz­heimer's - and there is evidence that even humans would not easily lose brain functions with age if they took long walks, avoided sugar, bread, white rice and stock-market investments, and refrained from taking economics classes or reading the New York Times.

Let me summarise my ideas of how Mother Nature deals with the Black Swan. First, she likes redundancies. Look at the human body. We have two eyes, two lungs, two kidneys, even two brains (with the possible exception of company executives) - and each has more capacity than is needed ordinarily. So redundan­cy equals insurance, and the apparent inefficiencies are associated with the costs of maintain­ing these spare parts and the energy needed to keep them around in spite of their idleness.

The exact opposite of redundancy is naive optimisation. The reason I tell people to avoid attending an (orthodox) economics class and argue that economics will fail us is the following: economics is largely based on notions of naive optimisation, mathematised (poorly) by Paul Samuelson - and these mathematics have contributed massively to the construction of an error-prone society. An economist would find it inefficient to carry two lungs and two kidneys - consider the costs involved in transporting these heavy items across the savannah. Such optimisation would, eventually, kill you, after the first accident, the first "outlier". Also, consider that if we gave Mother Nature to economists, it would dispense with individual kidneys - since we do not need them all the time, it would be more "efficient" if we sold ours and used a central kidney on a time-share basis. You could also lend your eyes at night, since you do not need them to dream.

Almost every major idea in conventional economics fails under the modification of some assumption, or what is called "perturbation", where you change one parameter or take a parameter henceforth assumed to be fixed and stable by the theory, and make it random. Take the notion of comparative advantage, supposedly discovered by David Ricardo, and which has oiled the wheels of globalisation. The idea is that countries should focus on "what they do best". So one country should specialise in wine, another in clothes, even though one of them might be better at both. But consider what would happen to the country if the price of wine fluctuated. A simple perturbation around this assumption leads one to reach the opposite conclusion to Ricardo. Mother Nature does not like overspecialisation, as it limits evolution and weakens the animals.

This explains why I found the current ideas on globalisation (such as those promoted by the journalist Thomas Friedman) too naive, and too dangerous for society - unless one takes into account the side effects. Globalisation might give the appearance of efficiency, but the operating leverage and the degrees of interaction between parts will cause small cracks in one spot to percolate through the entire system.

The debt taboo

The same idea applies to debt: it makes you very fragile under perturbations. We currently learn in business schools to engage in borrowing, against all historical traditions (all Mediterranean cultures developed over time a dogma against debt). "Felix qui nihil debet", goes the Roman proverb: "Happy is he who owes nothing." Grandmothers who survived the Great Depression would have advised doing the exact opposite of getting into debt: have several years of income in cash before any personal risk-taking. Had the banks done the same, and kept high cash reserves while taking more aggressive risks with a smaller portion of their port­folios, there would have been no crisis.

Documents dating back to the Babylonians show the ills of debt, and Near Eastern religions banned it. This tells me that one of the purposes of religious traditions has been to enforce prohibitions to protect people against their own epistemic arrogance. Why? Debt implies a strong statement about the future, and a high degree of reliance on forecasts. If you borrow $100 and invest in a project, you still owe $100 even if you fail in the project (but you do a lot better in case you succeed). So debt is dangerous if you are overconfident about the future and are Black Swan-blind - which we all tend to be. And forecasting is harmful since people (especially governments) borrow in response to a forecast (or use the forecast as a cognitive excuse to borrow). My "Scandal of Prediction" (bogus predictions that seem to be there to satisfy psychological needs) is compounded by the "Scandal of Debt": borrowing makes you more vulnerable to forecast error.

Just as Mother Nature likes redundancies, so she abhors anything that is too big. The largest land animal is the elephant, and there is a reason for that. If I went on a rampage and shot an elephant, I might be put in jail and get yelled at by my mother, but I would hardly disturb the ecology of Mother Nature. On the other hand, my point about banks in my book - that if you shot a large bank, I would "shiver at the consequences" and that "if one falls, they all fall" - was subsequently illustrated by events: one bank failure, Lehman Brothers, in September 2008, brought down the entire edifice.

The crisis of 2008 provides an illustration of the need for robustness. Over the past 2,500 years of recorded ideas, only fools and Platonists have believed in engineered utopias. We shouldn't think that we can correct mistakes and eliminate randomness from social and economic life. The challenge, rather, is to ensure that human mistakes and miscalculations remain confined, and to avoid them spreading through the system - just the way Mother Nature does it. Reducing randomness increases exposure to Black Swans.

My dream is to have a true "epistemocracy"; that is, a society robust against expert errors, forecasting errors and hubris, one that can be resistant to the incompetence of politicians, regulators, economists, central bankers, bank­ers, policy wonks and epidemiologists.Here are ten principles for a Black Swan-robust society.

What is fragile should break early while it's still small: Nothing should ever become too big to fail. Evolution in economic life helps those with the maximum amount of hidden risks become the biggest.

No socialisation of losses and privatisation of gains: Whatever may need to be bailed out should be nationalised; whatever does not need a bailout should be free, small and risk-bearing. We got ourselves into the worst of capitalism and socialism. In France, in the 1980s, the Socialists took over the banks. In the US in the 2000s, the banks took over the government. This is surreal.

People who drove a school bus blindfolded (and crashed it) should never be given a new bus: The economics establishment lost its legitimacy with the failure of the system in 2008. Find the smart people whose hands are clean to get us out of this mess.

Don't let someone making an "incentive" bonus manage a nuclear plant - or your financial risks: Odds are he would cut every corner on safety to show "profits" from these savings while claiming to be "conservative". Bonuses don't accommodate the hidden risks of blow-ups. It is the asymmetry of the bonus system that got us here. No incentives without disincentives.

Time to definancialise

Compensate complexity with simplicity: Complexity from globalisation and highly networked economic life needs to be countered by simplicity in financial products. Complex systems survive thanks to slack and redundancy, not debt and optimisation.

Do not give children sticks of dynamite, even if they come with a warning label: Complex financial products need to be banned because nobody understands them, and few are rational enough to know it. We need to protect citizens from themselves, from bankers selling them "hedging" products, and from gullible regulators who listen to economic theorists.

Only Ponzi schemes should depend on confidence: Governments should never need to "restore confidence". Cascading rumours are a product of complex systems. Governments cannot stop the rumours. We just need to be able to shrug off rumours, to be robust to them. Do not give an addict more drugs if he has withdrawal pains: Using leverage to cure the problems of too much leverage is not homoeopathy, it's denial. The debt crisis is not a temporary problem, it's a structural one. We need rehab.

Citizens should not depend on financial assets as a repository of value and rely on fallible "expert" advice for their retirement: Economic life should be definancialised. We should learn not to use markets as warehouses of value.

Make an omelette with the broken eggs: The crisis of 2008 was not a problem to fix with makeshift repairs. We will have to remake the system before it does so itself. Let us move voluntarily into a robust economy by helping what needs to be broken break on its own, converting debt into equity, marginalising the economics and business school establishments, banning leveraged buyouts, putting bankers where they belong, clawing back the bonuses of those who got us here and teaching people to navigate a world with fewer certainties. Then we will see an economic life closer to our biological environment: smaller firms and no leverage - a world in which entrepreneurs, not bankers, take the risks, and in which companies are born and die every day without making the news.

Extracted from the postscript to "The Black Swan: the Impact of the Highly Improbable" by Nassim Nicholas Taleb (Penguin, £9.99)
© Nassim Nicholas Taleb 2008 penguin.co.uk

This article first appeared in the 05 July 2010 issue of the New Statesman, The cult of the generals

Ason Mceachern
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He gave a total stranger $50,000 in cash: the strange, multi-million dollar empire of Trans-Siberian Orchestra

Kate Mossman meets the man behind one of the world’s wealthiest rock bands.

He calls it “whacking”. It began near his property on 12th Street, Manhattan. He’d get his driver to circle Union Square while he identified a suitable beggar; then he’d jump out, shove a hundred-dollar bill into their hand, jump back in and drive off. Soon, he realised that many of the people he was giving to were schizophrenic and he was scaring them out of their wits. So he started passing the money to his daughter because, he reasoned, they were more likely to accept it from a three-year-old girl. He gradually increased the amount he gave – from a hundred to ten, twenty, fifty thousand dollars in a roll of notes. Paul O’Neill and his daughter would drive around the square and she’d say: “Let’s whack ’em, Dad, let’s whack ’em hard.”

****

One of the biggest bands on the planet ­remains unknown to much of the world. Trans-Siberian Orchestra (TSO) have spent much of the past decade on Billboard’s annual list of top music moneymakers; they now play to a million people a year and have grossed over $500m in concert revenues since they were founded 20 years ago. In 2014 they made almost $52m in 52 days. They tour for seven weeks only, from November to January. To maximise profits, they split into two halves – one band for the west coast of America and the other for the east – and play matinees as well as evening shows.

Their genre? Heavy metal Christmas music. TSO are a glittering chorus line of rock chicks and axe heroes in black tie and tails, suspended on wires or balancing high above the stage on hydraulic platforms playing rock’n’roll mash-ups of “Deck the Halls” and “Dance of the Sugar Plum Fairy”. There are 18 people on stage, 240 staff and 40 trucks to transport them. The show, which looks like Pink Floyd-meets-Meat Loaf’s Bat Out of Hell, employs 18 lasers and 750 pyrotechnics. The band travels with two trailers of generators: they once blew out the electricity grid in Jackson, Mississippi.

TSO’s creator, O’Neill, divides his time between New York City and Florida, where the band began. I speak to someone at a UK rock magazine who once had a phone call with him. “Just don’t get him on to Chur­chill,” he says.

The Morrisound Recording studio in north Tampa was once the nerve centre of Florida’s legendary metal scene, playing host to many of the genre’s nastiest acts, including Sepultura, Cannibal Corpse and Napalm Death. Like most luxury recording spaces, it hit hard times in the past decade; then, in 2015, TSO bought it and turned it into their headquarters, Night Castle. It lies behind high gates and is staffed by polite young engineers with russet beards. Visitors are met with a large food centre stocked with six different kinds of mineral water and a pine-fresh smell not typical of the recording studios of the past.

O’Neill has taken on a slightly mythical status within TSO. The official photographer tells me that you rarely see him because he is “so protected”. When in Tampa, he is accompanied by a 6ft 4in driver-cum-security guard with the physique of a wrestler, whose name is Tracey.

O’Neill emerges grinning from a darkened doorway. He has the little, anthropoid legs of Jeff Beck or Mick Jagger (finished off with heavy biker boots) and the sprung stoop of one who has great nervous energy – a coiled way of moving along, like someone who is ready to help but equally ready to flee.

He sits down, throws one knee over the other and gestures at a large analogue mixing desk, saying, “You don’t see too many of these any more,” in the quick voice of a native New Yorker.

He was born in Flushing, Queens in 1956, one of ten children of second-generation Irish immigrants. His father, who had fought in France, worked for a telecoms company; he put himself through night school and qualified as a history teacher. O’Neill’s siblings are high achievers. He was “always the dumb one”. At seven, he still couldn’t read, so his mother kept him in the house for the summer and “forced phonics down my throat” until he could.

As an adolescent in the early 1970s, he performed at Manhattan folk clubs, though he is not nostalgic about it. He played guitar in productions of Jesus Christ Superstar and Hair – “Well, illegal touring versions,” he qualifies. “Everyone was doing it at the time.” He entered Jimi Hendrix’s ­Electric Lady Studios at 52 West Eighth Street to produce a progressive rock band called Slowburn but failed to translate the baroque melodies in his head into playable music, so he gave up and went to work for the infamous management duo Leber and Krebs, who broke Aerosmith and AC/DC. These were tough times – Sharon Osbourne’s father, the manager Don Arden, would assert his power over rivals and clients by hanging them out of windows. O’Neill worked for Aerosmith as a tour manager and “settler” – meaning, he explains, that he would carry a fee of up to $50,000 in cash in a briefcase that, for security reasons, was handcuffed to his arm.

He has the disconnected synapses suggestive of years of hard living and his soft voice flits between business, American sentimentality and early-20th-century warlords at alarming speed.

“I’ll tell you why Aerosmith don’t play the UK,” he says. “They can’t stand the plumbing. They can’t believe you don’t have the mixer taps. You know Churchill was a fan of American plumbing, too?”

His long chin gives his face a perpetual expression of mischief. When he is not wearing his sunglasses, he keeps his pale, grey eyes shut. He says things like, “The one rule of work is: don’t do anyone any favours, because then they’ve got nothing on you.”

In the mid-1980s he was booked to produce a band called Heaven but was ejected halfway through a project that could have been huge – a heavy metal version of Bob Dylan’s “Knockin’ on Heaven’s Door”, five years before Guns N’ Roses did theirs. He’d also wanted to try out something else with the band – a mash-up of “God Rest Ye Merry, Gentlemen” and “Carol of the Bells”, played on electric guitars.

Joan Jett to Jefferson: O’Neill with his treasure collection (large “Mr Livy” on the left). Photo: Bob Carey

It wasn’t your average business proposal: “six rock operas, a trilogy about Christmas and one or two regular albums”. O’Neill put it to the Atlantic Records mogul ­Ahmet Ertegun in the mid-1990s and claims to have been written a blank cheque. “Christmas is the holy grail,” he tells me. “Dickens wrote five books about Christmas. So I said, ‘Then it’s too big for one album, too.’”

On TSO’s first Christmas album, Christmas Eve and Other Stories, a young man wanders into a bar and learns the magic of Christmas from a mysterious old man; it has sold 3.4 million copies. Then there’s The Christmas Attic, in which a child explores an attic on Christmas Eve; The Lost Christmas Eve; and the DVD The Ghosts of Christmas Eve. Sleeve notes include short stories written by O’Neill. A few years ago, he even produced a 50-page novella called Merry Christmas Rabbi, which featured Nazis. Atlantic wouldn’t let him turn it into an album “because they were too freaked by it. Now it’s on Amazon for, like, a buck 99.”

His plan was to create a modern-day Nutcracker, something whole families would come to see, year after year. 
“I think we were in the right place at the right time,” he says. “Even Grandma has been to Woodstock. It made it a lot easier for us to jump the generational wall. That’s what I wanted to do with the Beethoven and Mozart, too. People treat the symphonies like they’re museum pieces but I think they scream out for electric guitars. The record industry acts as if people only like one kind of music. In truth, they like variation. Which is why we have hamburgers and chicken nuggets.”

Symphonic rock was not a new idea. Emerson, Lake and Palmer threw Bach, Mussorgsky and Grieg into their prog concoctions forty years ago. “I worship Greg Lake,” O’Neill says. “Greg is the Obi-Wan Kenobi – he is the Socrates of prog rock.” Both Lake and Jon Anderson of Yes have joined TSO on stage, as have the Who’s Roger Daltrey and Aerosmith’s Steven Tyler.

I call Lake at his home in Guildford to find out what it was like. His version of the band’s inception is different from O’Neill’s. “They are the most peculiar operation,” he says. He is 68 and sounds a bit like Ray Winstone. “I heard they came up with the idea of doing a prog-rock Christmas show and took it to the promoters, who told them it was a dumb idea. They have a friend in Cleveland, a small-time promoter, and they basically bullied him into doing it. And they got away with it. The more I talk to them, the more I realise that they don’t really understand what the phenomenon is. On paper, it looks like a bad idea. A prog-rock Christmas show? Stop it. But it’s like a cult.”

Backstage at Long Island, before the TSO show, Lake’s new iPhone disappeared from his dressing room. He told a security guard, and ten minutes later the device turned up next to the urinals. O’Neill had gathered the entire crew and told them no one would receive their Christmas bonus if the phone was not surrendered. “That’s Paul for you,” Lake says. “He is like the Mafia.”

Back at the studio, O’Neill plays me a YouTube clip of one of his west coast singers, John Brink, doing a TSO showstopper called “Back to Reason”, a ballad about a father searching for his son. By the end of the song, Brink is crying.

I ask where he sourced the tenor.

“Les Mis!” he says brightly. “I always go to Broadway shows to steal!”

Though TSO might sound like a racket, they could be making even more money. Tickets are capped at about $75. “There is enough money for everybody,” O’Neill says. “You don’t have to gouge every last penny out of people.” With a $20m production, they have to sell out every night. When he started out, he could see Led Zeppelin at Madison Square Garden for $7.50, he says. “And here’s the sad thing – nowadays, the first 20 rows are empty because the only people who can afford them are corporations, and they’re in the bar the whole time, making business deals.”

He says that Florida was destined to be the birthplace of his group because it is the home of both heavy metal and Disney World. “I worship Walt Disney,” he says. “He decided he was going to build an amusement park so clean that if you lost your three-year-old, you wouldn’t worry. And you would just pay one price and all the rides were free. TSO is an ideal, too – charge the fans the lowest price and make them feel emotions they have never felt before.

“Aaaaanyway,” he says, spinning on his chair, “time for more swag. It’s all about the swag.”

He heaves the four-disc vinyl version of TSO’s 2009 concept album, Night Castle, on to his lap. While Yes had their in-house artist, Roger Dean, TSO have Greg Hildebrandt. “He did the most iconic painting of the 20th century,” O’Neill explains – “the original Star Wars poster.”

He opens a glossy tour programme. “I said to Greg, ‘I want multiple pictures of Beethoven.’ And then I said, ‘I need you to Churchill him up a bit.’” He shows me a sorrowful, white-haired Beethoven, thickset like a Disney character and bulldog-ish around the jaws, crouching over the body of a fallen woman. His index finger flies over the images. “Here’s the condemned banker who cooked the books. Here’s the carousel from Coney Island, all broken. And here’s my daughter, Ireland, on her unicorn. And here’s the castle – I’m gonna to build that, one of these days.” I ask him whether the fans know what all these symbols mean.

“That is one of the things we need to do,” he says. “I need to explain this to the fans!”

****

Cut to a café in Tufnell Park, north London, on a cold February day. Anna Phoebe lives nearby with her children and husband, the BBC presenter Gavin Esler. She studied social policy and government at the London School of Economics. She was also a member of TSO for six years, from 2004 to 2010, eventually becoming the lead violinist.

Phoebe had played violin at university. On graduating, she went to New York for an audition where a woman in dark glasses said, “There’s someone I want you to meet.” She was 22 years old when she joined TSO and suddenly found herself performing to 20,000 people a day, executing knee slides while cranking out rock versions of “Ode to Joy”. “You’re playing the same size stages as Springsteen or Bon Jovi and you’re paid as a rock star, too,” she says.

The fee for the three-month TSO ­season covered her living costs for the rest of the year; it bought her a flat in Berlin and ­financed two solo albums. “We’d be given $5,000-worth of Bloomingdale’s vouchers at the start of every tour. Paul would say, ‘If you’re gonna be a rock star, kitten, you’ve gotta look like a rock star.’”

She explains that part of the business model was signing merchandise and meeting fans: between 700 and 1,000 people each night, after every show, and double that on matinee days. She mentioned in a blog that she liked banana bread; at a gig soon after, a fan turned up with several slices of the cake strapped to his torso (“I’ve been trying to get this into the venue for, like, three days,” he said). She received other gifts from followers: an ice sculpture carved in her image and CDs of TSO fans reading the Bible.

Middle America is the band’s heartland; they don’t often play college towns. In 2004 an electrical engineer from Mason, Ohio, programmed 16,000 Christmas lights on his house and had them flashing to TSO’s song “Wizards in Winter”; when a video of this was put online, it became an internet sensation. Two years ago, 16 households in Yucaipa, California, synchronised an entire neighbourhood to the song, filming it from above with a flying drone.

“I learned more about America in that signing line than anywhere else,” Phoebe says. “The people we were playing to, they were Sarah Palin voters at the time. The poorer the state, the bigger the audience and the more men in military uniforms. This was the height of the Iraq War. They’re saying, ‘Can you draw a star for my son? He’s 17 years old and he’s passed away in Iraq.’”

She says that O’Neill is “kind of insane, smart, extremely kind – and in a very privileged position to be like that and be able to follow it through”. There are musical directors, Al Pitrelli and Bob Kinkel, to make his unplayable melodies a reality, and a business manager, Adam Lind, “to take his 20 ideas and home in on the one that is going to make money – or not lose money”.

Once, in the studio garden, she saw what she thought was a crumpled bag of rubbish and realised it was a bundle of hundred-dollar bills that O’Neill had dropped by accident. At Christmas, the whole band would be given money in an envelope and were told to give it away within 24 hours to  a member of the public. “It’s quite an addictive feeling. It makes you feel like Mother Teresa,” Phoebe says.
“He has created a world, and whether he sees an idealised version of himself, or what the world should be, or what the people around him should be, I don’t think anyone really knows exactly what is going on in his head.”

****

When O’Neill and I finish going through Hildebrandt’s artwork, it is dinner time. We move out to the car park, surrounded by staff, and he heads over to a BMW i8, which can go from 0 to 60 miles per hour in 4.4 seconds and retails for $150,000. It resembles the Batmobile. Its doors peel upwards and O’Neill, as bendy and black as the machine itself, deposits himself in it, then changes his mind and joins me and Tracey in an armoured SUV.

“Have you got the baby?”
he says.

“Don’t worry, I’ve got the baby,” Tracey says. The baby is a large, black briefcase. It is too full to close and weighs at least 45lb. He tells me it contains the only copy of a forthcoming TSO project, Running in the Passions of the Fairy Tale Moon – the music and the full libretto.

“I still handwrite everything,” he says. “I can barely master email. I learned to text two months ago.”

Our car is overtaken by the Batmobile, driven by one of the young engineers. O’Neill will follow us back in it. “I know how to get home from the studio but not from the restaurant,” he explains. “I’m sorry. You’re thinking, ‘I’ve come to America to interview a retard.’”

We arrive at our destination and he takes the baby from the car. Its huge weight makes him lean to one side, like a thin tree in the wind. We enter a dark, nondescript restaurant in the basement of a hotel. He whispers something to the hostess that ends with: “It’s non-negotiable.” He ­orders a large steak that remains pretty much untouched and asks for an extra salt cellar, which he lines up next to the other one. He does not remove his sunglasses. He listens to everyone else talk and asks me how my bacon cheeseburger is, adding shyly, “I have bacon flavour toothpaste and bacon floss.”

He is less than comfortable. I cannot believe that he fears being recognised when few know what he looks like. I wonder whether the baby causes his anxiety – whether carrying the next multimillion-pound project in his hand at all times sends him back four decades to the briefcase handcuffed to his arm. He hesitates, grinning, then leans over and takes my wrist, plunging it into the left-hand side of his leather jacket and pressing my fingers around the thick, bobbly grip of a Glock semi-automatic pistol.

****

It was summer 1986 in Los Angeles. O’Neill’s friend Ray Gillen was standing in for Glenn Hughes as the lead singer of Black Sabbath, after Hughes had injured his throat in a fistfight. It was early morning and the Rainbow Bar had chucked out, so O’Neill got his Ferrari and the two of them went to the 24-hour Tower Records store on Sunset Strip. They bought a tape of Andrew Lloyd Webber’s Phantom of the Opera, which had just opened in London, and drove around until 6am listening to “The Music of the Night”, saying: “He’s God, we suck, he’s God, we suck.”

The idea of a rock band as a stage musical may be a desperately unromantic proposition but it has taken root among a generation of rock stars trying to ensure that people play their music way beyond its creators’ natural lifespan. O’Neill whispers that Queen came to see TSO shortly before they launched their West End musical We Will Rock You in 2002. Then came Rock of Ages, in which young musicians acted out the glory days of the Sunset Strip in a plot based on the narrative of the Journey song “Don’t Stop Believin’”, which in turn has enjoyed a second life through the TV show Glee.

Journey now tour not with their original singer, who had hip problems, but with a Filipino fan they found on YouTube. Yes recruited a younger Canadian vocalist, Benoît David, to take the place of Anderson, another singer known for reaching notes that others cannot reach. Singers are always the first to go, says O’Neill, who has little attachment to individual rock stars. “The human voice is just these thin Kleenex tissue muscles; they’re not designed to scream on top of amps five nights a week. It’s not a matter of if you are going to destroy these guys’ instrument but when. That’s why we have multiple lead singers – to allow the vocalists to rest. TSO can go into their eighties.”

There’s an old-school heavy metal band scattered among the TSO chorus line, whose story is a litany of all that can go wrong in rock’n’roll.

Two brothers, Jon and Criss Oliva, had grown up playing Kiss and Alice Cooper covers in the car parks around Clearwater, north of Tampa. Jon had a voice that could do Robert Plant one minute and Freddie Mercury the next: “I call it the Mel Blanc gift,” says O’Neill. “You know, the guy who does all the sounds in Looney Tunes?”

They called themselves Savatage and, with O’Neill as producer, they conquered MTV in 1987 with a video filmed in an underground cavern featuring a dwarf (“Hall of the Mountain King”). But demons crushed the band. Jon wrote most of their second album in rehab. In October 1993, Criss was killed by a drunk driver on the way to a Livestock Festival in Zephyrhills, Florida, and Savatage went into a state of suspended animation.

“I knew we needed something to justify a band with no original members left,” says O’Neill, with no sense at all of how strange that sounds. “I didn’t want to see all those albums disappear. It’s not about getting caught up in the person or the individual.”

In 1996 Savatage’s “Christmas Eve/Sarajevo 12/24” – O’Neill’s longed-for mashup of Christmas carols – was picked up by a New York radio station and metal band morphed into TSO. Their name comes from an unfinished rock opera about the Romanovs – just one of fifty Broadway musicals O’Neill claims to have conceived.

“Look, this band doesn’t make sense on paper,” he concludes. “When I started out with Savatage, I thought it would be like the Eagles. I thought I’d be living off the royalties by now. I did not foresee the collapse of the record industry. I had to find a way to make it work. I worry about the next Steven Tyler or Janis Joplin – where are they going to go? What a thousand generations took to build, a single generation can lose. I’m sure Washington and Alexander Hamilton worried about the future, too.”

Last July, TSO played the Wacken Open Air festival in Germany – a heartland for them, because of all the Beethoven. After dark, the site was hit by a storm, knocking down the sound system. While the stage was being repaired, O’Neill wandered around the camp, talking to punters, possibly in a cloak, like Henry V before Agincourt. He found two young men of 19 who turned out to be Sunni Muslims from Iraq. About 90 feet away, he talked to two men from Iran who were Shia Muslims.

“During those three days of that festival,” he says, “I can’t imagine those four young men didn’t bump into each other. And God forbid, two years from now, they end up in two different militias and they recognise each other, I’d bet everything I have that not only would they not pull the trigger; they would un-chamber their weapons and say, ‘Hey, weren’t we together at a TSO ­concert?’ It’s hard to hate – let alone kill – somebody that you went to a concert with.”

****

The next day, O’Neill is jumpy. We’re travelling to one of his properties to look at his treasure collection. He shows me CCTV footage filmed from the main entrance of the band’s former studio in Tampa. On the noiseless laptop screen, in broad daylight, the stockinged head of a robber slides into the frame; he gets to work on the studio doors with a pair of bolt-cutters. “Three pairs of lady’s pantyhose,” says O’Neill in horror, pointing at the robber’s disguise. “We were inside the whole time – I had my Glock and I didn’t want to use it but I would have.” When the burglar realises that the band is home, he beats a speedy retreat.

O’Neill has had problems with aggressive fans, too, which he passes over with a shudder. “I hate evil,” he says, more than once. TSO’s product manager Thomas Ayad, of Universal Music Group, was killed in the Bataclan terror attack last year. Today, as if to mirror O’Neill’s increased anxiety, there is not one overstuffed briefcase but three.

Sitting next to me in the back of the car, he tosses a small box from hand to hand. He opens it to reveal a Fabergé egg containing a microfilm edition of 50 pages of the original King James Bible that was sent up in the Apollo 14 space mission. He says that he lets kids hold it, so they can feel history in their hands. It’s not clear which kids he means.

We enter his property. I hear sighing and turn to find O’Neill splayed against a wall, throwing the five-point handle of a vault’s combination lock from left to right as if wrestling with the wheel of a mighty ship. In the close confines of a walk-in safe, he pulls items from the shelves: first editions of proceedings from the trial of Thomas Paine from 1793, and Churchill’s two-volume biography of his father, signed. He shows me signed first editions of Dickens’s Christmas Books and two original anonymous prints of The Ballad of Reading Gaol by Oscar Wilde, after whom O’Neill’s daughter, Ireland Wilde, is named. (Wilde means as much to him as Churchill.) Then he gets out a picture book that Joan Jett gave him. A note says: “Dear Paul. I hope you enjoy this reflection into the past and thanks for being a big part of mine.”

“Here’s Louis XV borrowing a tonne of money in 1732,” he says, presenting me with a piece of parchment, “and Benjamin Franklin building some forts.” There’s a letter from Nelson from before the Battle of Trafalgar (“I wrote a rock opera about him”) and a handwritten fragment of a speech by Reagan (“I love Ronald Reagan”). There are dozens of letters from Thomas Edison to his engineer, detailing every stage of the invention of the phonograph. He has the whole set, apart from one he gave to Steven Tyler.

He shifts a painting out of the way – a colourful scene of some rabbits, painted by Jon Anderson for his daughter – and pulls out the pièce de résistance: a gorgeous first edition of Leaves from the Journal of Our Life in the Highlands, signed “To Lord Kitchener of Khartoum” by Queen Victoria. “Can you get any more historic?” he asks. “Kitchener went to Khartoum two days too late and saw Chinese Gordon’s head on a spear.”

Finally, with embarrassment, he shows me a letter from George Washington to Thomas Jefferson, dated 1779. It has been badly crumpled in storage. “Maybe one of these big heavy books will help?” He reaches for a giant edition of Livy and flattens the letter under it. “Mister Livy, can you please help out poor George?”

He drifts out of the room. “There’s other stuff I want but I’ve got to stop because I’m losing track of it,” he says. “My daughter says, ‘Dad, don’t die and leave me with all this stuff. It’s like King Tut’s tomb.’”

He wanders out on to the patio, where the sun beats down so strongly that he must be melting in his leathers. He pulls himself up to perch on a little stucco balcony, legs swinging, and for a moment he epitomises the contradiction at the heart of rock’n’roll wealth: the baby boomers who bought the lifestyles of the landed aristocracy but insist on looking like pickled versions of the boys they were when they first picked up a guitar.

I ask him whether he’s glad that his days with Aerosmith are over. His liver shut down in the 1970s; he broke one of his vertebrae wrestling with bouncers. On the one hand, these stories are badges of honour; on the other, there is relief in his voice.

“Cocaine is Russian roulette,” he says. “One person can walk away from it and another can’t. I never thought I would live this long. My mother told me I wouldn’t live past 30. I was always falling through roofs. I still feel like I’m 19. I’m 60. How did this happen?”

I ask him if he is happy. He says, “Solon said to Croesus, ‘Don’t judge your life a success or a failure until the very end.’”


****

Despite O’Neill’s obsession with the British empire (“Churchill understood India better than Gandhi did”), his band is cagey about plans to play in the UK. TSO first performed in London at the Hammersmith Apollo in 2011, to an audience of about 2,000, with just six trucks of gear. The boiler was broken, the auditorium was freezing and everyone kept their coat on. Ask O’Neill if he is coming back any time soon and he gives a small sigh.

“I think he’d settle for nothing smaller than the O2 Arena,” says Anna Phoebe, “but, for a start, they’d have to get rid of all the narration in the show because British people do not like being told what to think.”

O’Neill’s characters are simplified figures – Tiny Tims or Little Match Girls, or the ­brazier-hugging idiots savants of 1980s Christmas movies. At the age of 16, working as a busboy in Hell’s Kitchen, he received a hundred-dollar bill as a tip from a stranger and never looked back.

“They’re selling the American dream and yet ‘the American dream’ no longer exists,” says Phoebe. “Even Barack Obama said it – what your father earns is more of an indicator of your future wealth than anything else. TSO sell the romanticised version – you can be poor, you can work hard, you can get yourself out of where you came from – and we don’t relate to that. But he enjoys a challenge. His brain will probably work overtime to overcome this problem.”

“I don’t necessarily think it will work over here,” Greg Lake says. “I don’t necessarily think they’d be doing themselves any favours. What is it, the money? They’re not going to sell 100,000 tickets!”

I ask Lake whether he can see a future in which young stage-school kids play the hits of long-dead bands, giving them eternal life.

“I’ve seen a Japanese ‘version’ of Emerson, Lake and Palmer, believe it or not,” he says. “I felt quite ill. Fact is, who is going to interpret the classical music of today – which is rock music – when the original players are gone?

“It’s hard to imagine what sort of currency rock music will have in a hundred years’ time. I’ve played some biblical shows – 600,000 people in one go – and that era won’t be easily forgotten. I’ve never seen that many people in one place. You wouldn’t. Other than in a war.”

Two days after we spoke, Lake’s bandmate Keith Emerson committed suicide after a period of depression connected with a degenerative disease that was affecting his playing. Before he hung up, Lake had told me about the last time he saw O’Neill: he presented Lake with a gift, one volume of the multi-volume memoirs of Winston Churchill, and told him he had put a bookmark in it.

“I opened it up and it’s a thousand-dollar bill,” Lake said. “Tell him he can ‘whack’ me whenever he wants.”

****

The sun goes down on Tampa as we barrel along Interstate 4. O’Neill takes his shades off in the evening light. He says he wears them because he is afraid of going blind. His father has lost his sight and blindness has affected nine members of his family. He is tired, and when he is tired, he speaks in military history.

Is the age of the rock’n’roll hero over?

“It’s all about the idea and real heroes grasp that. Washington didn’t want to be king. He had an idea, which was America.”

Who will he hand his project on to?

“Some kid who hasn’t been born yet. Abraham Lincoln came out of nowhere. He had ten days of schooling in his whole life. I had the ultimate gift in life, which was low expectations. I just feel lucky that it’s happened and I just hope that no one catches on that I’m getting away with murder.”

He is fed up with talking about the band but is too polite to say so. “Thank God for Britain,” he says instead. Congress is a mess. Obamacare? Please. Trump is a moron.

He sings a couple of bars of “Rule, Britannia!” soft and high.

“Seriously, it’s like the last days of Rome here,” he says. “But I think it will pull together. I believe in happy endings.”

Kate Mossman is the New Statesman's arts editor and pop critic.

This article first appeared in the 28 July 2016 issue of the New Statesman, Summer Double Issue