In this week’s New Statesman: Steven Poole on the rise of Big Data

PLUS: Rafael Behr on the angry white guys tearing the Tories apart.

Cover Story: The Digital Panopticon

In this week’s cover story Steven Poole looks at the promise of “Big Data” – that we will be saved from our manifold dilemmas so long as we measure the world. Google Flu Trends can track the spread of an influenza epidemic, Google Translate’s corpus of phrases and likely translations far surpasses all others, and aircraft and other complex engineering projects can be made more reliable once components are able wirelessly to phone home information about how they are functioning. But how useful is big data in the first place? And should we be wary of the consequences?

. . . as Viktor Mayer-Schönberger and Kenneth Cukier point out in their useful recent book, Big Data: “Big data itself is founded on theory.” And once you’ve manufactured data with instruments that operate according to certain theories, you then need to analyse it theoretically. At the Large Hadron Collider, subatomic smashing generates a million gigabytes of data every second. Automated systems keep just a millionth of this for analysis (discarding the rest based on theories), but the bit-heap is still Brobdingnagian. And it needs to be analysed according to still other theories before scientists will understand what is going on. Until then, the data itself is just inscrutable numbers. Raw data is not knowledge. According to IBM, 90 per cent of the world’s extant data has been created in the past two years. Unless I missed something important, that is not because the human race has very rapidly become much wiser.

Rafael Behr: He was the future once – David Cameron and the struggle to be modern

By the end of this year, David Cameron will have served longer as the leader of the Conservatives than any of his three most recent predecessors put together, writes Rafael Behr. Longevity would be an advantage for a prime minister in charge of his party, running a competent administration and presiding over a benign economy. Cameron is doing none of these things:

The Cameron project was conceived in the middle of the last decade as a re-enactment of Tony Blair’s march on power in the mid-1990s. A metropolitan cult of renewal was central to that ambition . . .

When the Tories were in opposition, cultural refugees from the new liberal-left social consensus could cherish the hope that a Conservative prime minister might bring cultural restitution. Then along came Cameron’s clique of west London fops, legislating for gay marriage and referring to the party’s stalwart activists as “swivel-eyed loons”. To the disinherited fringe, Cameron’s “modernisation” felt like a continuation of the reviled Blair-Brown occupation. (The reliance on Labour MPs to pass same-sex marriage legislation reinforces the sense of conspiracy.) No wonder Farage’s rallying cry is territorial. He urges supporters to “take our country back”.

What’s more, the Tories have miscalculated the Ukip vote. “We indulge these people by saying they’ve been given nothing,” a senior Conservative adviser says. “How many Ukip supporters have second homes in Marbella?” Not very many, actually, according to the polls.

The prevailing tone of British politics is alarmed by the present, ashamed of the recent past and obsessed with romantic retellings of an imaginary past anterior. The vacancy for a leader who projects credible optimism about what comes next is unfilled. For Cameron, this is now an almost impossible task.

David Blanchflower: This was King and Osborne’s lost decade

In the Economics Column this week our economics editor, David Blanchflower, berates the joint record of George Osborne and the outgoing governor of the Bank of England, Mervyn King, saying he “nearly fell over laughing” when King announced at the press conference for his valedictory inflation report that “a recovery is in sight”.

“I would be surprised to see growth of more than 1 per cent this year and next,” Blanchflower predicts. “This looks like King and George Osborne’s lost decade.”

So just what does King mean by “recovery”, and is there any merit to the Chancellor’s assertion that the economy is “healing”?

There is rather mixed evidence from business surveys: the purchasing managers’ surveys showed some pick-up, but the Bank of England agents’ surveys suggest little improvement. The EU’s Economic Sentiment Index, which combines consumer and business surveys, fell again in April. The labour market continues to weaken. Underemployment is rising again; there has been a further surge in the number of people who are part-time but want full-time jobs . . . It is unlikely that, with such uncertainty in the air and shrinking wages, consumers are heading for a spending spree. The patient is still in intensive care.

PLUS

The Diary: Jonathan Smith on the darker side of Cornwall, tailgaiting in Virginia and Elvis’s top half

David Herman: Why is television still so white?

Letter from Serbia: Fiona Sampson takes a journey to the heart of the Balkans

Hugh Purcell on the New Statesman’s past: Fellow-Travellers at the NS, shadowy MI6 placements and the senior staffer Gaitskell’s wife said was “Stalin dressed as a nun”

Laurie Penny applauds the bravery of the suffragettes

Ed Smith: In cricket, as in Britian, the north-south divide is as deep as ever

David Puttnam: What makes us human?

In the Critics

This week, Hedley Twidle, the winner of the 2012 Bodley Head and Financial Times Essay Prize, considers the latest travelogue by Paul TherouxThe Last Train to Zona Verde: Overland from Cape Town to Angola. Theroux, Twidle writes, “is unwilling to let go of his African fantasies” and the result is disastrous. “He mints generalisations and insults at such a clip that they soon begin to outstrip even the most gifted parodist.” Twidle concludes: “Bankrupt in more ways than one, this is a book I would recommend as a teaching aid or to someone interested in tracking the final sub-Conradian wreckage of a genre.”

PLUS

  • Colin MacCabe reviews Stephen Nadler’s The Philosopher, the Priest and the Painter. “Nadler’s book, though an admirable portrait of Descartes’s life in the Netherlands, gives no sense of the strangeness of Descartes’s vision.”
  • George Eaton praises the modesty and wisdom of Andrew Adonis, which shine through in 5 Days In May, his book about the coalition negotiations. “As a long-standing believer in a ‘progressive coalition’, Adonis felt this failure [of the Lib-Lab negotations] more keenly than most.”
  • Alice O’Keeffe on the limitations of nature writing, as revealed in Robert Macfarlane’s latest book, Holloway. And Leo Robson praises All That Is, the latest novel by the87-year-old American writer, James Salter. “Salter’s grammar-defiant swooning is the vehicle for a deep seriousness about human sensation and emotion and you give in, happy to helpeless.”

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I was wrong about Help to Buy - but I'm still glad it's gone

As a mortgage journalist in 2013, I was deeply sceptical of the guarantee scheme. 

If you just read the headlines about Help to Buy, you could be under the impression that Theresa May has just axed an important scheme for first-time buyers. If you're on the left, you might conclude that she is on a mission to make life worse for ordinary working people. If you just enjoy blue-on-blue action, it's a swipe at the Chancellor she sacked, George Osborne.

Except it's none of those things. Help to Buy mortgage guarantee scheme is a policy that actually worked pretty well - despite the concerns of financial journalists including me - and has served its purpose.

When Osborne first announced Help to Buy in 2013, it was controversial. Mortgage journalists, such as I was at the time, were still mopping up news from the financial crisis. We were still writing up reports about the toxic loan books that had brought the banks crashing down. The idea of the Government promising to bail out mortgage borrowers seemed the height of recklessness.

But the Government always intended Help to Buy mortgage guarantee to act as a stimulus, not a long-term solution. From the beginning, it had an end date - 31 December 2016. The idea was to encourage big banks to start lending again.

So far, the record of Help to Buy has been pretty good. A first-time buyer in 2013 with a 5 per cent deposit had 56 mortgage products to choose from - not much when you consider some of those products would have been ridiculously expensive or would come with many strings attached. By 2016, according to Moneyfacts, first-time buyers had 271 products to choose from, nearly a five-fold increase

Over the same period, financial regulators have introduced much tougher mortgage affordability rules. First-time buyers can be expected to be interrogated about their income, their little luxuries and how they would cope if interest rates rose (contrary to our expectations in 2013, the Bank of England base rate has actually fallen). 

A criticism that still rings true, however, is that the mortgage guarantee scheme only helps boost demand for properties, while doing nothing about the lack of housing supply. Unlike its sister scheme, the Help to Buy equity loan scheme, there is no incentive for property companies to build more homes. According to FullFact, there were just 112,000 homes being built in England and Wales in 2010. By 2015, that had increased, but only to a mere 149,000.

This lack of supply helps to prop up house prices - one of the factors making it so difficult to get on the housing ladder in the first place. In July, the average house price in England was £233,000. This means a first-time buyer with a 5 per cent deposit of £11,650 would still need to be earning nearly £50,000 to meet most mortgage affordability criteria. In other words, the Help to Buy mortgage guarantee is targeted squarely at the middle class.

The Government plans to maintain the Help to Buy equity loan scheme, which is restricted to new builds, and the Help to Buy ISA, which rewards savers at a time of low interest rates. As for Help to Buy mortgage guarantee, the scheme may be dead, but so long as high street banks are offering 95 per cent mortgages, its effects are still with us.