Defanging the apex fanatics

James Ganesh writes about the current US administration's approach to war in Ukraine:  

Trump is a commercial animal. So is his envoy Steve Witkoff. By “commercial animal”, I don’t just mean someone from the private sector, such as Mitt Romney, but someone who views the whole world through a business lens. ... [T]he war —in fact, war itself — must baffle a commercial animal. The idea that people would fight out of principle is alien to homo economicus. A political commentator must befriend business people, for their original angle on things, for their range of international experiences, for their (often) pleasanter company. But doing so also brings home their intellectual blind spot, which is an inability to understand fanaticism. And by that I mean a literal refusal to believe that such a thing really exists. There are exceptions, but people who have to be pragmatic for a living will tend to assume that all the world is the same, and that ideology is just a cover for reasonable material interests. When business and democracy don't mix, James Ganesh, Financial Times, 18 December 2025

I will grant that there are fanatics who will not be swayed by any sort of financial inducement. But they are all supported to some degree by people who, I believe, could be encouraged to topple or defang those at the apex of the power structure. I think the fanatics who have accumulated power - including the power to start wars of aggression - did so because of the passive or active support of people who were amenable to non-ideological incentives. Such enablers may have been drawn in by the charisma of the apex fanatic, or believed that the apex fanatic could help their business; they might just have wished to be close to power, and thought that backing the apex fanatic was their best bet. Or they may even be ordinary members of the public, desperate for a change. All these enablers might sympathise with the fanatic's ideas and ideology; few of them, though would share the apex fanatics' total commitment to their cause. 

Social Policy Bonds could help (1) deal with existing fanatic-led activities, and (2) constrain the influence of political fanatics. 

(1) Take the war in Ukraine or, indeed, any areas of existing or potential conflict in the world. And assume that the goal of everyone - apart from the apex fanatics - is a lasting peace. Applying the Social Policy Bond principle to that conflict, or any other, would mean issuing bonds that become redeemable only when peace had been sustained for, say, fifty years. Such a lasting peace would be viable only if each side of the conflict came to some sort of agreement, tacit or otherwise, to end their conflict and to reduce the likelihood of future conflict. Such bonds, targeting regional conflicts, or world peace, would do little to deter the apex fanatics, but would help offset the incentives that currently encourage their enablers to support their accession to positions of power. 

(2) We shouldn't have to put up with fanatics starting wars or otherwise creating mayhem. But we can't outlaw fanaticism, nor do we need to. We should focus instead on the limiting the incentives that drive the enablers to hand power to the fanatics. Social Policy Bonds, by targeting outcomes, could shrink the role of ideology and hence fanaticism in the political process. Instead of voting on the basis of soundbites, personality or tribal loyalty, people would be presented with an array of broad social and environmental improvements, which they would prioritise. Government would then articulate voters' wishes, and raise the revenue that would fund their achievement. Apex fanatics would be marginalised and maybe divert their energies into less disruptive endeavours. Business perhaps? 

For more on how the bond principle could be applied to regional or global conflict, please follow the links on this page. 

 

Priorities

It's lamentable (to me) that so much brainpower gets channeled into lucrative, but socially useless, activities:

High-speed traders are feuding over a way to save 3.2 billionths of a second

A millisecond used to be a big deal for the world’s quickest traders. A dispute over huge trading profits at one of the world’s largest futures exchanges shows they now think a million times faster. The controversy is about an arcane technical maneuver in which high-speed traders bombard Frankfurt-based Eurex with useless data. The idea is to keep their connections to the exchange warm so they can react fractionally faster to market-moving information. Link Alexander Osipovich, 'Wall Street Journal', 15 December 2025

We shouldn't condemn these people, whatever the net results of their collective actions. They are reacting rationally to the incentives on offer; and few of us spend all our time solving the world's problems. It's the incentives that are perverse. If people can make enough cash to bring up a family by shaving off some nanoseconds per financial transaction more than the next guy, then that is what they will strive to do. It is disappointing, though, that the undoubted ingenuity that went into these traders' software isn't channeled into more socially beneficial activities. 

Social Policy Bonds could change that. A bond regime would reward people for solving society's urgent, long-term problems. It would stimulate diverse, adaptive approaches the nature of which we need not know in advance, but which are necessary given the failings of our current political systems to end the militarisation of our planet, deal with climate change or otherwise improve social and environmental well-being. 

A Social Policy Bond regime would allow us to target broad global and national goals explicitly, while channeling the market's efficiencies into the best use of our limited resources. Given that the survival of the planet itself is under threat, I think the case for such targeting is a strong one, even if we have to give up high-frequency trading to get there. Incentives aren't everything, but they do matter. 

Who would go into politics?

Who would go into politics? The obstacles and disincentives for ordinary people who consider a political career keep increasing:

• you and your immediate family will need enhanced security - even if you are not very high profile; this might apply even after your political career ends; 
• everything you said or put in writing over the past few decades will be trawled and used against you; 
• in most democratic countries, the financial rewards aren't very high.

The results are plain to see: politics has become a game for billionaires and those acting for them. We have a political caste of (mostly) mediocrities who've had little experience in productive enterprises. Some would have embarked on a political career for idealistic reasons, but many of these leave because they can achieve their goals more effectively outside the political circus, or because they aren't sufficiently thick-skinned to take all the abuse their position inevitably attracts. 

One idea might be to adopt the Singapore model: 

Singapore’s remarkable transformation is built on meritocratic governance, where competence, integrity, and performance drive leadership and policy decisions. In political leadership & governance, leaders are selected based on expertise rather than popularity, with rigorous recruitment, performance-based promotions, and corruption-free administration ensuring stability and long-term vision. In public administration & civil service, a highly efficient, professional bureaucracy ensures that civil servants are promoted based on performance, not tenure, with strict anti-corruption measures and ongoing training programs maintaining accountability. Meritocracy in Government Leadership: Example of Singapore, Metamatics and Jakub Zeglitz-Bares, Strategic Intelligence, 20 February 2025

And, crucially (from the same source):

Ministerial salaries in Singapore are pegged to the salaries of top earners in the private sector (such as CEOs and top executives). This ensures that talented individuals do not avoid government service due to financial reasons. 

Singapore's Prime Minister was paid $1.6 million in 2024. There are opportunities for less well-paid politicians to become wealthy from, for example, speeches or writing their memoirs, but they are less certain than official salaries, often less ethical, or the rewards usually have to be deferred until after they have left office. 

An alternative approach could involve issuing Social Policy Bonds: a bond regime would shrink the role of politicians and their ideologies; under a bond regime, political debate would focus on articulating society's goals and raising the revenue required for their achievement. Goals are less divisive than the supposed means of achieving them; and they would be expressed in ways meaningful to everybody, so that there would be greater public participation in the policymaking process, and hence more buy-in. This would be in stark contrast to policymaking today, which is difficult and tedious for people to follow unless they are paid to do so, or are lawyers. Reducing the role of politicians in this way could enlarge the circle of would-be entrants to the profession, such that it might then encompass people from more diverse backgrounds. 

It's all too complicated. I'm off to the boozer

George Monbiot writes:

Today, foreign corporations, or the oligarchs who own them, can sue governments for the laws they pass, at offshore tribunals composed of corporate lawyers. The cases are held in secret. Unlike our courts, these tribunals allow no right of appeal or judicial review. You or I cannot take a case to them, nor can our government, or even businesses based in this country. They are open only to corporations based overseas. If a tribunal determines that a law or policy may compromise the corporation’s projected profits, it can award damages of hundreds of millions, even billions. These sums represent not actual losses, but money the arbitrators decide the company might otherwise have made. The government may have to abandon its policy. It will be discouraged from passing future laws along the same lines, for fear of being sued. Record numbers of cases are being brought, as corporations learn from each other, and hedge funds finance suits in return for a share of the takings. The result? Sovereignty and democracy are becoming unaffordable. The process is known as “investor-state dispute settlement” (ISDS). Hello, foreign oligarchs and corporations! Please come and sue the UK for billions, George Monbiot, 'The Guardian', 1 December 2025

Most of us are unaware of ISDS, and I wonder whether even our politicians know about it and its implications. Maybe they do know, but don't care. Maybe they would care if they knew but, as with most people, are prone to the learned helplessness and demoralisation that afflicts those faced with incomprehensible processes. Perhaps ISDS and similar stratagems are purposely made incomprehensible for that reason. Complexity can be used cynically to deter scrutiny and deflect blame. 

Social Policy Bonds have two essential elements. Injecting market forces into the achievement of our social and environmental goals is one. But perhaps even more important is that the bonds express policy in terms of meaningful, explicit, verifiable outcomes. The ISDS is allowed to override domestic law and the decisions made by parliaments because it has been 'written – without public consent, and often in conditions of extreme secrecy – into trade treaties.' Under a bond regime, people would have incentives to see whether such treaties conform with society's goals, and to veto them if, like the ISDS, they obviously don't. Under the current regime, the only people who understand and participate in the drafting of these treaties are those who are paid to follow the process. Whether the treaties are consistent with society's goals or not has nothing to do with how they are renumerated. 

Expressing policy in terms of outcomes that are meaningful to ordinary people would encourage greater public participation in the policymaking process: an end in itself, as well as a likely means to more effective policies. Currently, policy debates focus on institutional structures and funding arrangements; the people who make policy are often chosen on the basis of the campaigning skills of their sponsors; and the policies themselves have only vague ostensible goals, and real goals that can be easily obscured by their  tedium and complexity of policymaking process. The gap between politicians, officials and the wealthy on one side; and ordinary people on the other, grows ever wider. 

Complexity and learned helplessness

When people's wishes clash with vested interests it's the vested interests (aka 'the deep state'; aka the 'elites') that win every time. Our political systems are too complex, arcane or corrupt for ordinary people to stand a chance. One result is obvious: ever-rising income and wealth inequality. Another is learned helplessness. 

Voting makes little difference. And, while we don't really know the intentions of the people in power, I suspect that whoever they are doesn't make much difference. The vested interests are too powerful. They have perpetuated a policymaking process that effectively excludes influence from people outside their exalted circle. They have weaponised the complexity and obscurity of our systems of government for selfish ends.

They can get away with this because our political discourse centres on sound-bites, personality, and image. Actual policymaking is an entirely distinct process: much of it focuses on the structures and funding of government bodies, law and regulation; all of which are opaque to non-professionals - which is to say, ordinary people. The public. The rest of us. The only people who now really understand policymaking are those who are paid to do so, and the only people who influence it are those who have the millions of dollars necessary to pay them.You might even think the system has been specifically designed to keep ordinary citizens out of it. The barriers to entry into the world policymaking are high, and the public is almost totally demoralised.

I suggest that we change this by centering our policymaking discussions on broad outcomes that are meaningful to ordinary people. Instead of focusing on funding arrangements, institutional structures, legal manouevres and other arcana, our politicians should articulate society's wishes in ways that we can understand and influence. 

Meaningful outcomes: they form one essential element of the Social Policy Bond idea. The other is the injection of market incentives into their achievement: rewarding those who achieve our goals according to their efficiency in actually achieving them. The idea might sound outlandish at first hearing: it would entail that politicians contract out the solution of our social and environmental problems to investors. But, under a bond regime, government would help guide and articulate society's wishes - something that democratic governments are quite good at doing, and government would still raise the revenue for their achievement. Only their achievement would be subject to the market, which economic theory and all the evidence suggest is the most efficient way of allocating society's scarce resources. No doubt the Social Policy Bond idea could do with some discussion and refinement. But the real question is: what is the alternative? To continue as we are doing, where the gap between vested interests and ordinary people grows ever wider, risks, in my view, social collapse.

For more about Social Policy Bonds see the Social Policy Bonds homepage