When the polycrisis hits the omnishambles, what comes next?

We're set to find out

This post is the chimeric offspring of Paul Krugman’s post this morning, my and Abe’s piece in the New York Times earlier this week, and a not-very good joke from a couple of years back. But I think there is a useful, if grim general scheme of analysis in the collision of these three things, which I will jot down as briefly as I can (which is not as briefly as I would like) in the hope that I and others can get use from it as matters progress, and build on the faint flickers of hope that are implied.

The point of Paul’s post, taken from Marvin Hyman Minsky,* is that one of the key roles of government is to mitigate the tendencies toward irrationality in financial markets. Risks and higher profits tend to go together, encouraging the participants in financial markets to do ever chancier things with their and their clients’ money. To the extent that these risks are correlated, or actively reinforce each other, there is an ever increasing likelihood that people take too much risk and market goes kaput. Government regulators create rules that dampen this “irrational exuberance” to the immediate annoyance of financial people (who want to make as much money as they can) but to the long term benefit of society, making markets more stable, and crises less common. So what happens when the crypto folks (whose entire business model is irrational exuberance and ‘number go up’) get their hands on the levers of government? Nothing good.

My and Abe’s argument also talks a lot about the consequences of crypto - but for economic statecraft. We say that the two-decades-old system of economic coercion, under which specialized technocrats set the pace of economic statecraft - is over. We’ve suggested elsewhere that this system had its own tendencies toward irrational exuberance, underestimating the risks that their actions could have unexpected consequences. But those risks are likely to be much greater in Trump’s second administration, which combines a much bigger appetite for pushing other countries around, with a revealed preference to let Elon Musk and the crypto bros start smashing the government structures that actually allow the U.S. to do this.

That is partly down to Trump’s own peevish unpredictability. Thin skin and thick skull are an unfortunate combination in a leader. It is also down to the various factions in government, which seem united only in their enthusiasm to dismantle the administrative state. In our words, “we may be looking at the beginning of a world in which countries disentangle themselves from U.S. dependence at the same time that our machinery of power begins rusting from within.”

These are loosely similar insights - but they concern different aspects of the U.S. state. So is there some way of bringing them together?

A couple of years ago, on my now deleted Twitter account, I had a brief joking dialogue with Adam Tooze, about the concept of polycrisis, which he didn’t invent but has popularized. Adam explains the polycrisis as a concatenation of big problems - e.g. climate change; the crisis of democracy; global migration - that not only hit simultaneously but plausibly make each other worse. I pointed to another neologism, the “omnishambles” (from Arnaldo Ianucci’s dark comedy, The Thick of It - Wikipedia definition), describing governmental situations in which no-one has any idea what is going on or what to do, and policy-making is utterly shambolic and fucked up. By construction, I suggested, there must be such things as the polyshambles and omnicrisis.

It wasn’t a very good joke, but I think that there is a useful intuition behind it, which is worth turning into an entirely unfunny diagnosis. We are in a world where our problems are getting bigger, and are feeding on each other. Those of us who live in the U.S. are at the beginning of a sudden and dramatic worsening of the quality of government policy making. In other words, we are about to see a collision between the polycrisis and the omnishambles. So how do we think about this collision usefully?

From this perspective, both Paul’s post, and our op-ed map specific pieces of a larger and more complex problem. And when I use the term ‘complex,’ I use it advisedly. The polycrisis is a simplified way of talking about the world as a complex system. In Scott Page’s description, a “complex system consists of diverse entities that interact in a network or contact structure.” In less academic language, it is a larger system composed of smaller sub-systems that interact with each other. Even when these sub-systems are relatively simple, the whole may be complex and unpredictable. And when they are themselves complex …

This way of thinking about the world helps clarify what the polycrisis involves. Complex interactions may give rise to positive feedback loops, in which different parts of the system reinforce each other so as to induce instability. To apply this to the polycrisis, think crudely of how climate change may increase the likelihood of large scale migration across borders, leading to crises of democracy and government legitimacy, which in turn makes governments less capable of regulating the economic activities that make climate change worse. But complex systems may also give rise to homeostasis, in which some parts of the system become adaptive, perhaps dampening down positive feedback loops and responding dynamically to unexpected changes in the environment.

One of Paul’s early books builds on these ideas (although he later became skeptical, since they are notably better at describing the phenomenon than predicting how it will unfold, let alone providing precise guidance on what to do about it). Indeed, the Minsky cycle is exactly an example of how government may act to limit the likelihood of positive feedback loops getting out of hand. Without regulation, irrational exuberance feeds upon itself and the behaviors it induces. The role of the Federal Reserve, famously, is to order “the punch bowl removed just when the party [is] really warming up.”

Behind Paul’s post - and our piece - lies a possible understanding of the larger situation we face. In good times, we have an environment in which the problems are not too big, or can be dealt with one by one, or, ideally, both things are true at once. We have a government that is capable of dealing with them, acting as a kind of homeostatic regulator, which dampens down the possible chaos without, and perhaps even takes advantage of the unexpected possibilities it provides (while avoiding eviscerating the dynamical aspects of the economy - one can absolutely have too much government).

We are not in those good times. Instead, we are in an increasingly unpredictable environment with multiple major problems reinforcing each other in complex ways (the polycrisis). At much the same time, the most significant government in the world is absolutely not acting as a homeostatic regulator. Instead, of dampening down the chaos, it is accelerating it, while ripping out large swathes of the administrative apparatus that potentially allow it to understand the environment and influence it.

Trump’s second term is going to be the apotheosis of the omnishambles. And it is potentially even grimmer than that. In an ideal world, there is at least a second order feedback loop such that bigger problems leads to better government and the expansion of capacity for government to deal with these problems in conjunction with other modes of problem solving (markets; democracy). In the world we are in right now, there seems to be just the opposite set of feedbacks. Bigger problems are not leading to better government in the U.S. and elsewhere, but to worse.

As noted already, complexity theory is much better at describing problems like this than at predicting how they will turn out, let alone solving them. But it at least provides a framework for seeing how the different sub-systems might interact together.

The crises we are likely to face in Trump’s second term are not simply going to be crises of financial regulation, or of tariffs, or of withdrawn security guarantees, or breakdowns of scientific knowledge, or loss of capacity to respond to emergencies. They are likely, instead to involve the interactions of two or more of these factors with each other, and with the pre-existing problems of the polycrisis. Mapping out - even crudely - the relationships between these different sub-systems will help us be better prepared for what happens, even if we cannot fully anticipate it.

It provides a better framework for understanding the true weirdness of the ideas animating the agenda of DOGE and many of the Silicon Valley connected people who are backing Trump. Behind Marc Andreessen’s celebration of ‘effective accelerationism’ with its ‘technocapital singularity’ lies the delirious counter-cybernetics of the neo-reactionary thinker Nick Land, who depicts positive feedback loops as a Lovecraftian dark god to be worshipped and celebrated:

The story goes like this: Earth is captured by a technocapital singularity as renaissance rationalization and oceanic navigation lock into commoditization take-off. Logistically accelerating techno-economic interactivity crumbles social order in auto sophisticating machine runaway. As markets learn to manufacture intelligence, politics modernizes, upgrades paranoia, and tries to get a grip. The body count climbs through a series of globewars. Emergent Planetary Commercium trashes the Holy Roman Empire, the Napoleonic Continental System, the Second and Third Reich, and the Soviet International, cranking-up world disorder through compressing phases. Deregulation and the state arms-race each other into cyberspace. By the time soft-engineering slithers out of its box into yours, human security is lurching into crisis. Cloning, lateral genodata transfer, transversal replication, and cyberotics, flood in amongst a relapse onto bacterial sex. Neo-China arrives from the future. Hypersynthetic drugs click into digital voodoo. Retro-disease. Nanospasm.

Finally, it provides a framework for thinking about what we need to do. In a world of proliferating, intersecting crises that feed upon each other and themselves, building state capacity is crucial. This might, or might not mean more state depending - the more crucial and urgent tasks are twofold. First, to remake the state so that it is more flexible and responsive. Second, to create different feedback loops between the state and democracy than the one we are trapped in right now, in which the bigger the crises get, the more that they empower the people who want to ignore them, rip out the control systems, or, in the extreme, actively welcome the crises in. I’ve written before about the beginnings of alternatives that are at least better aware of the challenges we face, but they’re only the beginnings, and we need a whole lot more.

* Thanks to Maxim Raginsky for immediately spotting obvious error - I am teaching a course on AI and democracy this semester, and have been reading a lot of and about Marvin Minsky in prep - hence temporary brain malfunction …