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First the worst, second the best

The role of luck in success

If we’ve learned anything in the past few days, it’s that life at the top is even better than we thought and life at the bottom is probably just going to keep getting worse.

The thought for the week was brought to you by David Cameron, who seems to be operating under the healthy, no-nonsense, fresh-air-and-cold-showers theory that removing housing benefits from the unemployed will make them all the more determined to do well (rather than, say, depressed to the point of comatose). The super-rich, on the other hand, deserve gold stars for their achievements, and tax law like a cable-knit jumper. It’s motivational.

There are many problems with Cameron’s approach but, in the interests of staying within my word count, I’m going to distil them into one – which is that he is not the headmaster of a small private school. The world of work, you see, operates a little differently. A recent study from Oxford’s Saïd Business School highlighted how, in professional life, ending up at the very bottom or the very top is much more to do with luck than whether you pull your socks up and stop smoking behind the sheds.

Such is the power of luck that society’s biggest failures share a surprising similarity in approach to society’s biggest successes. To demonstrate this, the experimenters created two computer models, simulating five million players of differing skill going through a win/lose game of 50 rounds. The “success” of each person was then modelled on how many rounds they won.

The first model showed that in careers where success builds on previous success (ie, most jobs), luck has a vastly magnified impact on those at the top. Those giving “exceptional performances” were of lower skill, on average, than those giving merely very good performances. The important factor was an early chance success, which then snowballed. Similarly, “extreme failures” (the long-term jobless) were not the least able – they were just unlucky early on.

Highs and lows

The second model looked at careers in which there is an element of risk (investment banking, for instance). Results showed that both the highest and lowest achievers took the riskiest paths. The experimenters noted again that huge success did not correlate well with skill.

They concluded that we should be more careful about dismissing the failed and praising the exceptional, writing of the danger that “high rewards for exceptional performance may tempt other people to deliberately take risks or to cheat because they are unlikely to achieve extreme performance otherwise”. Instead, we should strive to copy the second- or third-in-command.

What can we take from this? Well, first, we should throw out our Mark Zuckerberg biographies and fill our shelves with titles such as Making It to the Middle: How I Only Gave Up on Some of My Dreams and Reaching for the Stars: How I Once Groped John Barrowman. But perhaps we should also take another look at Cameron’s penchant for punishing the unlucky and rewarding the already fortunate. Lady Luck is a harsh mistress, and the day she is allowed to dictate policy is the day she becomes a tyrant.

Martha Gill writes the weekly Irrational Animals column. You can follow her on Twitter here: @Martha_Gill.

This article first appeared in the 02 July 2012 issue of the New Statesman, Clegg the martyr

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Is anyone prepared to solve the NHS funding crisis?

As long as the political taboo on raising taxes endures, the service will be in financial peril. 

It has long been clear that the NHS is in financial ill-health. But today's figures, conveniently delayed until after the Conservative conference, are still stunningly bad. The service ran a deficit of £930m between April and June (greater than the £820m recorded for the whole of the 2014/15 financial year) and is on course for a shortfall of at least £2bn this year - its worst position for a generation. 

Though often described as having been shielded from austerity, owing to its ring-fenced budget, the NHS is enduring the toughest spending settlement in its history. Since 1950, health spending has grown at an average annual rate of 4 per cent, but over the last parliament it rose by just 0.5 per cent. An ageing population, rising treatment costs and the social care crisis all mean that the NHS has to run merely to stand still. The Tories have pledged to provide £10bn more for the service but this still leaves £20bn of efficiency savings required. 

Speculation is now turning to whether George Osborne will provide an emergency injection of funds in the Autumn Statement on 25 November. But the long-term question is whether anyone is prepared to offer a sustainable solution to the crisis. Health experts argue that only a rise in general taxation (income tax, VAT, national insurance), patient charges or a hypothecated "health tax" will secure the future of a universal, high-quality service. But the political taboo against increasing taxes on all but the richest means no politician has ventured into this territory. Shadow health secretary Heidi Alexander has today called for the government to "find money urgently to get through the coming winter months". But the bigger question is whether, under Jeremy Corbyn, Labour is prepared to go beyond sticking-plaster solutions. 

George Eaton is political editor of the New Statesman.