A Look at Governance: Anthropologists join actuaries on risk

Gillian Tett:

On the first issue, for example, it is possible to view the world in two ways. Sometimes societies assume that there is a vertical, hierarchical pattern of control (ie somebody, like a government, in charge) but sometimes there is a horizontal dynamic where crowd power rules. This second pattern is roughly how the financial markets were supposed to work before 2007, when investors and free market forces shaped our financial system instead of government diktat. However, since 2007, government intervention has repeatedly trumped the power of the crowd, in ways that feel alien to investors.

However, it also matters whether we believe that societies operate in a benign, accountable manner, or not. Hierarchical relationships can be considered beneficial; wise regulators, for example, can shape markets in sensible, accountable ways and corporate managers steer their way round risks. But sometimes power seems capricious and harmful; panic-stricken governments suddenly do unpredictable, negative things. Similarly, while crowd rule can feel benign and collaborative, markets, say, can feel like a community, it can also be anarchic and unpleasant, a jungle driven by Darwinian selfish instincts.

I thought this passage "Sometimes societies assume that there is a vertical, hierarchical pattern of control (ie somebody, like a government, in charge) but sometimes there is a horizontal dynamic where crowd power rules." was appropriate for what we often witness in the school governance arena.

Posted by Jim Zellmer at August 4, 2012 2:20 AM
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