Elliott Jaques's strata theory and politicians

The objective of this post is to introduce an interesting theory about organisations and apply it to political systems. Elliott Jaques was an academic that studied organisational behaviour. Most of his research was done outside mainstream academia, which means that there is not a great deal of high quality published, empirical work validating his ideas. I do not know much about his background, but I am aware that many academics consider his ideas unacceptable on political grounds. That is enough to scare a lot of potential researchers away. His sin was probably to imply genetic differences between individuals and to praise hierarchy. I have always found the theory fascinating for its potential implications.

Strata theory

Here is a very brief introduction: When individuals are around 20 years old, they have different ability to think ahead. This could be due to nature (i.e. genes and epigenetic effects) or nurture (e.g. parental support, good schools, helpful peers). The theory divides people into seven strata. At age 20, the theory states that individuals in the highest stratum can think 1.5 years ahead and individuals in the lowest stratum less than a month ahead. With time everyone gains experience, but at different rates. At age 40, the highest stratum can think 10 years ahead and the lowest a couple of months ahead. The lower strata reach their potential in their forties, but the higher strata can improve into their seventies. The theory is very specific in numbers. Since there is lack of empirical validation, there is no need to focus on such details. What is interesting is the overall shape of the curves.

Organisations need managers that are able to think ahead. The higher echelons in an organisation should be populated by individuals in the higher strata. If there is fit between individuals' abilities and organisational needs, we have the best of worlds. A bank needs to be run by a CEO that is able to think well into the future to minimise risk. Maybe an older person in stratum 6. A fast moving consumer goods company requires somebody slightly lower. The brands need to be nurtured for the long term, but the downside associated with failure is less. Maybe a person in stratum 5 will be acceptable, but somebody in stratum 6 will probably perform better. Finally, technology companies take very different approaches. At one end is Jeff Bezos, CEO of Amazon, who is able to think very long term (maybe stratum 7). At the other end is the start-up team that build a company only to expect that it will be bought by a larger company (maybe stratum 4).

(Jaques put great focus on designing training systems that are able to get the most out of all people; from stratum 1 all the way to stratum 7. Finally, the system also has stratum 8 (i.e. genius), which is not labelled directly in figure 1. I will disregard this level.)

Figure 1. Elliott Jaques's strata theory. Individuals have different ability to deal with complex cognitive tasks. The theory divides individuals into seven strata. Jaques posited that CEOs of large corporations should think more than 20 years ahead. That is unlikely to be the case in 2014. We can be lucky if they think 5-7 years ahead

Political system

The political system is the most complicated system man has created. It consists of government bodies and, in democracies, political parties vying for control of the government bodies. The government bodies have objectives that require thinking ahead several decades (e.g. building physical infrastructure, delivering lower and higher education, protecting physical borders, designing laws). Physical borders can last for a thousand years. Roads will last for a century. The effect of education will influence an age cohort for 60-70 years. There are other government bodies that require somewhat less thinking ahead (e.g. social security, health care).

Who is reaching the top of the political system?

Can we be sure that individuals in strata 6 and 7 reach the top in the political system? Could there be biases that makes such people (1) choose other career options or (2) become outmanoeuvred by individuals in strata 4 and 5?

I will provide some examples from the political parties that are in control of the government bodies. In the examples, I am not at all discussing the apolitical administrators in the government bodies. They are probably equally important. These examples are just illustrations. I do think they are close to the truth, but I have not systematically analysed the individuals, but I have followed them over a long time period.

UPDATE JUNE 2016: In this article from 2001, Jaques mentions a ninth stratum. Rereading my post, I think all assessments should be increased one stratum. My original assessment was primarily based on the implicit planning horizon, indicated in figure 1, used by the politicians. END UPDATE 

United States

George W. Bush (4). How far ahead was George W Bush and his advisers able to think during the escapades in Afghanistan and Iraq? My guess is that Bush belongs to stratum 4 (or possibly 3). In other words, he would be able to think 2 to 4 years ahead. His inability to initiate any kind of planning of what would happen after an American victory (or failure) is a strong indication that under his leadership, the White House was not able to think very long term. 

Barack Obama (4). How well is the current president performing? His defining political domestic legacy is the Affordable Care Act. This is a fairly technocratic piece of legislation that does not require much thinking ahead, maybe 2 to 4 years (stratum 4). Somebody in a higher stratum would probably have thought twice whether it would be a good idea to favor this legislation at the same time as the country experienced the most severe recession in 75 years. It might have been better at the time to think about fiscal stimulus to the economy.

In the international arena, I think Obama really shows his lack of long term thinking. He does not seem to have a strong ability to keep multiple issues in mind at the same time. He also does not seem very able in considering second order effects. Here are a few examples:

• 2008. Mentioning a deadline for the withdrawal of US troops from Iraq would only embolden the opposition. They would stay quiet and increase guerilla warfare only after the US troops departed. The standard game theoretic strategy would be not to make the departure date public (even if it would have been set).
• 2009. Accepting the Nobel Peace Prize before having accomplished anything.
• 2014. Mentioning passing an unacceptable "red line" if Syria were to use chemical weapons and then retracting and being saved by Putin's resistance to a UN resolution. Nobody that can think ahead four years would issue an ultimatum without thinking through all consequences.
• 2014. Support of the ousting of the democratically elected Russia-friendly president in Ukraine without understanding that Putin would respond with countermeasures. Subsequently painting Putin into a corner, out of which he will fight.

Singapore

Lee Kuan Yew (7). The first Prime Minister of Singapore was Lee Kuan Yew. He is an old man today, but it is important to remember that he was only around 36 years when he won his first election in 1959. Going strictly with Jaques model (figure 1), nobody at that age could think more than around 6 years ahead. His well-documented worries after the breakup with Malaysia in 1965, might be an indication that he did not have a long-term plan at all. However, in later decades, LKY took difficult decisions that would have very long-term consequences. This is evidence of very long term thinking (stratum 7)

• The opening up for multinational corporations and the strong focus on the English language in the educational system in the 1970.
• The focus on Mandarin in the 1980s after early realising that Deng's China was different from Mao's China.

Lee Hsing Loong (5). The current Prime Minister Lee Hsien Loong is an interesting case. At 52, he was considerably older when becoming Prime Minister in 2004. It is my impression that he is not able to think ahead as far as Singapore's first Prime Minister. 

• He is currently overseeing large programmes to improve public transportation and housing. However, these programmes started late given the demographic trends which would have been possible to forecast. 
• The government seems more reactive today than in the past. This could of course be a consequence of Singapore being more developed, the electorate being harder to satisfy, or less ability to think about the long term.

I simply do not know enough, but it seems reasonable to make a preliminary conclusion by placing him in stratum 5 or maybe 6. There is no evidence to believe that he would be any lower. The next ten years will tell.

Sweden

Fredrik Reinfelt (4). Sweden has had a non-socialist government led by Prime Minister Fredrik Reinfelt since 2006 . His Finance Minister Anders Borg has managed the economy well and the country is one of the better performers in Europe after the Great Recession. However, the typical Reinfelt-reforms have consequences already in 1-2 years:

• His government made it possible for households to deduct the cost of domestic help before paying income tax.
• His government has changed the rules for social security payment with the focus of involving more people in the labour market.  

His government has been less able to deal with the real long-term responsibilities of a national government. For instance:

• The Swedish Armed Forces have largely been dismantled. Conscription has been abolished, but there is no professional army taking its place. However, the air force is still strong. Sweden spends around 1% of GDP for defence (USA 4%, UK 2%, Singapore 3%). This is similar to many other European countries. However, around 50% of the cost of the military units are salaries and pensions.
• The performance of the educational system has gone down continuously since the first PISA study in 2000. The Education Minister keeps doing cosmetic changes to the school system, but the root causes of the problems are not addressed. Obvious solutions like respect for the teacher, grades, streaming, and homework are still considered taboo. Many so called expert argue that there should be no homework at all in schools. Firing bad teaching and rewarding good teachers are also taboo. Furthermore, teacher has evolved into a low-status occupation.
• Sweden has only one university (a medical school) in the top 100 worldwide (Singapore has 2, USA numerous). All universities are funded through the government. The governmental policy has been to use the higher education budget to create many small universities.

The failure to invest in the long-term, is a strong indication that Reinfelt does not think long term. I would place him in stratum 4.

Does it matter?

Even if some of the leaders reviewed above are as low as stratum 4, they are all leaders of advanced economies with checks and balances built into the political system. Even one bad leader cannot destroy an advanced economy quickly. However, a string of leaders of stratum 3 or 4 will weaken any economy over time. The situation is more complicated for developing countries. An individual in stratum 3 or 4 would in a few years be able to destroy a less advanced economy. The examples are numerous. And unless the country gets a string of stratum 6 (or at least 5) prime ministers/presidents (as well as key Ministers), a stable advance would be difficult. 

So the quality of our political leaders clearly matter. Do we have systems in place to get strata 6 and 7 leaders in power? Think about the promotion system inside an organisation. Person A and person B; both in their 30s. A thinks 5 years ahead and B thinks 1 year ahead. Who gets the promotion? B will spend more time thinking about getting the promotion. He will be a better networker, he will run errands to please seniors, he will get some quick results. Person A is already thinking years ahead and does not even consider these activities important. If the political party does not have any advanced system in place to track the career paths of talented individuals, then people like B will become more and more common. Fast forward twenty years and person A can now think 15 years ahead and person B can now think 2 years head. However, by that time the system is populated with many individuals like B. I believe this is a massive problem for the political systems in all countries. It might be impossible to design a promotion system that generates individuals in stratum 7, but it should be possible to create a system which identifies stratum 6 individuals within a political party. Maybe the hardest part it to get the electorate to pick a stratum 6 leader instead of a stratum 3 or 4 leader.