Gender quotas: the left’s version of trickle-down economics

 

Suppose a time-traveller from today could go back to the 1960s. His status as ‘the man who knows the future’ quickly earns him enormous political influence, which, being a right-on bien pensant, he uses to persuade the then government to introduce mandatory female quotas in boardrooms. How would that have changed social history? Would female emancipation in the economic sphere have happened more quickly? Would it have sped up the entry of women into higher education, politics, the media, and higher-paid professions?

We cannot know, but my guess is no. More likely, it would have produced an economy with gender equality at the very top, but with all other walks of life left unaffected. Boardroom members are scarcely a representative cross-section of society at large, and cases of elite groups inhabiting a different social universe than the majority of the population are hardly unheard of. (Just speak to a member of the Brussels bubble.) What is so special about boardrooms, anyway?

The reason why feminists and classical liberals disagree on this issue (to put it politely) is that they have different ideas about how social change works. Classical liberals think of it as analogous to disruptive market innovations: An innovator launches a new product (e.g. mobile phones in the 1990s). The public is suspicious (‘Mobile phones are for show-offs’). But since we do not decide on this matter collectively, those who deviate from the consensus are free to do things differently. The rest of us can observe the minority’s use of the product, and if it brings genuine advantages, we gradually drop our opposition. After a while, it is as if the product had always been around, and we forget that we were ever opposed to it.

It is not unlike that with social changes. In the 1960s, it was not the norm for women to pursue careers and be economically independent. But those who disagreed with the social consensus of the time were free to deviate from it. Many did, others followed, and those who clung to the old role models could not avoid being exposed to alternatives. Gradually, these alternatives became the new normal. Such a process of persuasion does not have to be articulated; it does not require verbal reasoning. We don’t need a ‘national debate’ first, we just need the freedom not to adhere to a social consensus.

Just as importantly, a competitive market economy provides us with strong incentives to keep our personal prejudices out of our business decisions. Even the most sexist/homophobic/racist employer can realise that by hiring only heterosexual men of Saxon descent, they limit the talent pool accessible to them, which is not smart business. Especially when talented applicants can go on and work for a competitor.

Does this mean that economic equality can be reached without social engineering? No. As long as population subgroups differ (on average) in preferences, attitudes, values etc., and as long as these differences are economically relevant, differences in economic outcomes (on average) can persist.

So much for the classical liberal interpretation. In the feminist interpretation, men, or allegedly ‘dominant’ groups in general, are seen as a gigantic cartel. (This is expressed in phrases like ‘a system built by men and run for the benefit of men’.) Through concerted action, these cartels can exclude newcomers and perpetuate their dominance forever. Moreover, this cartel also controls the media and the education sector, giving them enormous propagandistic power which they use to further cement their dominant position. This is why feminists can appear so shrill and angry: in this worldview, seemingly random phenomena all become part of a big plan. You thought ‘lads mags’ were just harmless entertainment, a bit tacky at worst? Think again. Once you connect the dots in the feminist way, they become part of a propagandistic effort to condition us into accepting sexist role models. It’s all about power, it’s always about power.  

The short summary is that while in the classical liberal perspective, social change can happen by itself, in the feminist perspective, this idea is naïve at best and cynical at worst. If a powerful cartel is incontestable, breaking it up requires the force of the law. Female quotas in boardrooms are one part of that breaking-up process. Once there are more women in positions of ‘economic power’, they will make ‘the system’ a bit more women-friendly, from top to bottom. Trickle-down economics, so to speak.

In this sense, the feminist position on boardrooms is only one expression of a broader mindset which sees social change as something that must be manufactured from above. A worldview which puts so much emphasis on (imagined) ‘power relationships’ naturally focuses on grabbing those levers of power, and putting the right people in charge. See why feminists and classical liberals tend not to get on too well?  

Click here for details of tonight’s (14th August) panel discussion on ‘Women on Top: Should the EU be imposing gender quotas in the UK?’

 

Kristian, thanks for this excellent piece. One of David Cameron's first acts on coming to power in May 2010 was to appoint Lord Davies of Abersoch - a Labour peer - to prepare a report with recommendations on how (not whether) to drive up the proportion of women in senior positions in business and elsewhere. His report was published in February 2011, and was a feminist manifesto. I don't think Harriet Harman would have disagreed with a single sentence. One of Davies's recommendations was that if women didn't hold 25% of FTSE100 board positions by 2015, the government should consider gender quotas to force them to do so. The FTSE100 have co-operated enthusiastically with this social engineering exercise, and the CBI has been a strong supporter of 'improved' gender balance on boards for some years. In 2010, the year before the Davies Report, 13% of new director appointed by the FTSE100 were women. By 2012 the figure had more than quadrupled, to 55%. In common with virtually all the existing female FTSE100 board directors, the women were appointed as NEDs, in itself evidence of the gender merit gap at the top of major companies. All this is being done in the face of strong evidence showing that more female representation on boards leads to corporate financial decline. We have five longitudinal studies showing this, while proponents of more women on boards have not one longitudinal study showing improvement in financial performance. They used to say there was a business case for more women on boards - i.e. with more diversity, profits would improve. Another left-wing economic fantasy has crashed and burned. The five studies: http://c4mb.wordpress.com/improving-gender-diversity-on-boards-leads-to-... I engaged with House of Lords and House of Commons inquiries, including giving oral evidence, all to no avail. We have the grotesque spectacle of a Conservative-led coalition driving more women onto major corporate boards, despite knowing theyll be harmed as a result. And we know from the Davies Report that 25% is 'only a milestone on a longer journey' and in due course the FTSE250 will face the same pressures. And what is the British business community doing about this? Nothing. Absolutely nothing. As a former businessman for over 30 years (1977-2010) I'm utterly ashamed of the British business community. I congratulate the IEA for being the only think tank in the UK prepared to give exposure to this assault on the business sector. I invite anyone with an interest in this area to contact me at mike@j4mb.org.uk. Thank you. Mike Buchanan CAMPAIGN FOR MERIT IN BUSINESS http://c4mb.wordpress.com
I considered myself a liberal for a while, and I agree there is quite a degree of incompatibility with feminism. Recently the EU commision (the commission for the rights of women...) drafted a recommendation (Reccomendation 2011/2285(INI).) to prohibit the individual negotiation in the job market, because of the Wage Gap. For unjustifiable reasons, men still earn more than women (between 4% and 20%, depending on country) so the State must regulate the job classification and salary policies, such to reflect the education level and the "value" of work, removing not only the market negotiation but also removing from salary policies criterias related to risk, fatigue, achievements and working hours/conditions. In the same document the education gap (20%) in favour of women is apparently justifiable; but still there are issue to be addressed in the fields male dominated, engineering and siences... And in the same recommendation, no mention is done to the death rate at the workoplace (>90% of deaths and >80% of injuries are affecting men). It is a pity, because that would have given some indications of why men tend to get slighlty better wages... After reading the above recommendation I draw the conclusion that there is no hope for EU. If people fuelled by radical feminism and with absolutely no knowledge of the business, are given the opportunity to draft ridicolous reccomendations on how to regulate economies that are struggling to survive the pressure of taxation and welfare, then it means that we are at the final game, playing the Russian roulette
Fabrizio, thanks for drawing my attention to the Recommendation, which can be accessed at http://www.adapt.it/englishbulletin/docs/eu_parl_equal_pay_07_02_12.pdf . This is indeed a worrying document, as it seems to argue for the imposition of a fixed pay scale which is independent of market forces and based essentially on some sort of updated labour theory of value. There are many misapprehensions and confusions in this almost unreadable document and it is something I may write on at a later date. It is difficult to make a sensible, reasoned case against this kind of thing however when opposition appears in the media as being antediluvian piffle of the golf club tendency. There was some interesting stuff discussed at last night's debate at the IEA, but all that was was reported by the Daily Mail, the Telegraph and Huffington Post was Stuart Wheeler's belief that women can't play chess and Godfrey Bloom's hope that he might yet get invited to one of Berlusconi's bunga-bunga parties. Ye gods.
The drive for feminists is about control. They are not interested in fairness or logic. Their doctrine is founded on Marxist-Leninist principles. The 'cartels' of men will be replaced and will mean that 25% women on boards will become 40% and then 50% and so on but, I suspect, it will not be women with business acumen who will end up dominating these boards. The sisterhood will ensure that only pro-feminists assume control. Their intent is in setting up their own power block of economic, social and political control. Those women who oppose their designs will be sidelined and drummed out and the law will be fashioned (as it is being now) to exclude resistance. History is replete with examples of how a so-called dominant hierarchy simply gets replaced by a new order that turns out to be more tyrannical than the old. A classic and horrific example was how the Maoists in 1950s China replaced the Nationalists, and did so based on lies, incompetent management and stark brutality that ended up with the misery and death of millions of their people. If you want to see what kind of women some of these feminists are, just read some of the radfem quotes about wanting to destroy marriage and men. An excellent old book worth reading is 'Escape from Red China' (1962). It shows how they think; how they set out to destroy respect; and how they introduced thought control to the Chinese people - just like North Korea today. These same elements are using the freedom of western democracies to the same ends and are very much alive in modern day feminism. As the saying goes: ‘All that is necessary for the triumph of evil is that good men do nothing’ (Edmund Burke)
Len, there is a lot to be worried about. The idea that gender ideologues have a stake in regulating the job market. The idea that there should be a superior labour justice, tipical belief of those wiht a dogmatic approach to religions. The idea that economy, which is based on trade, should be based of an "objective" evaluation of resources... And along with that, a paranoid cospiracy presumption that men and enterprises discirminate women... I could continue for pages... But let's not digress. I'm embarassed to be represented, at some extent, by people of such low standing, both from an ethical and professional point of view. Coming back on track of the article's topic, once our society has "accepted" this gender quotas shame, it has endorsed automatically the paranoid gender ideology, and the "wage gap regulation" document I've mentioned is only a side effect of underestimating the self-replicating capacity of stupidity. It is also a proof that the business and politics live on different world.
David Cameron says that that somehow having more women on boards will improve performance despite a huge amount of fact based evidence to suggest the opposite. Whenever evidence is asked for from government, the CBI,30% club, catylyst or FTSE 100 CEO's to substantiate the argument that having more women on boards improves performance it is never forthcoming simply because there is none other than opinions masquerading as facts which begs the question why is a conservative government supporting a strategy that merely panders to feminist myths and not fact. If it were accurate that women were superior to men in running businesses as is suggested the FTSE 100 would be staffed entirely by women at all levels but particularly at board level because people like me as shareholders would demand it but I do not live in a fantasy world and do not base my investment decisions on theory or distortions of the truth or lies. Men and women need to wake up to the fact that that this social engineering will result in potential disaster for business performance, impact on pensions, corporate profitability and share prices. In addition if you have sons there future will be bleak because even if they are the best for the job a women will get it simply because they wear a skirt. A chairman of a major PLC in the UK recently said that having more women on boards adds to the atmospherics but did not mention performance!!. The anonymous contributor above is absolutely right in every respect and on that basis we should all be shouting loud to our MP's and the boards of corporate Britain that enough is enough.
In the City in the early 1990's mobile phones were held in disdain because people who had them were "required" to be available. Serious senior people wanted to demonstrate their seniority, independence and status above the commoners by not being at another's beck and call. Mobile phones were for the lower classes. Otherwise a thoughtful contribution save for the strange belief that a law is somehow social change manufactured "from above." Under any macro analysis laws are the parliamentary expression of the democratic will of the popular majority for the time being. The masses in another words. Hardly "from above" and of course not always right but the only and best system we have ..... So far.
There is and was popular consensus to bring back hanging, leave the European union and not go to war in Iraq but the masses were and have not been granted their wish.....the best system we have and democracy in action indeed!!!! There is not a popular consensus of the masses to put more women on boards merely a handful of feminists driving an agenda that politicians and other groups are too scared to challenge objectively or to think seriously about the consequences. The evidence base from politicians or feminists for this drive to get more women on boards is inspired by groups that are merely offering opinions masquerading as facts. Whereas there is substantial fact based evidence that to do so will have serious negative consequences for corporate Britain.
The only referendum on EU membership was in 1975 and it resulted in a resounding yes vote. On matters of international trade political and economic importance to a nation state one must draw the line somewhere - how many referenda on a subject is desirable and how often? If it is decided once as it was in 1975 should we go back again. The Scottish issue is revisited every 400 years. That is probably more than enough. Voters consistently do not vote for parties that advocate the death penalty, and the parliamentarians they elected between 1997 and to date have all consistently been by total majority in favour of the Iraq engagement. I actually suspect that if the question - "should there be more women on boards" - was put to the masses there would be a clear consensus in favour. Free market completely unfettered laissez faire capitalism does not appear to have engendered the warmth of the masses at all - surprise! And the masses desire to see more white men in corporate Britain making more money seems to have even less mass appeal - if that were at all possible. That is all entirely separate from the question of whether forced gender board policies are the best for the "bottom line" of capitalism, and that begs the question, is the "bottom line of capital" the only or most important criterion when legislating social policy. The answer to that question clearly, and by popular acclaim, repeatedly and historically, has been no.
Peter, to the best of my knowledge, 'popular opinion' has never invented a wealth-generating alternative to capitalism. As for your question, '... is the "bottom line" of capital the only or most important criterion when legislating social policy?', the best response I can give is the quotation with which I launched a presentation at the IEA last year: 'Few trends could so thoroughly undermine the very foundations of our free society as the acceptance by corporate officials of a social responsibility other than to make as much money for their stockholders as possible.' MILTON FRIEDMAN Capitalism and Freedom' (1962)
Thank you Mr Buchanan. Milton Friedman is right how else would governments pay for the bloated welfare state and the much favoured social engineering projects much loved by successive governments. If social engineering as the last government or "popular demand" want more women on boards it should only be on merit.
I've just stumbled across this debate while looking for something completely different. Can I deduce from this that the IEA held an event where speakers waxed lyrical about attending bunga bunga parties and blithered on about women being unable to play chess? You all sound like "men of a certain age" to me. The ladies are rushing on past you and you're left behind. Never mind, the internet is full of nice places like this for you to spend your time. My sister is brilliant at chess btw.
Charlie H.......Ridicule clearly is your strong point which is a shame rather than engaging in an adult objective debate................... but then how could you possibly be wrong!!!
Just googled this and discovered that the chap who said that women were no good at chess has been challenged to a game by some women. And surprise surprise, he is too frightened to take these ladies on. My sister is going to challenge him too. What fun.
I agree Mike. Popular opinion has never generated a better wealth creating system than capitalism. But on any macro view popular opinion invented our whole system including capitalism since 1649 at least, represented effectively by our parliament and its leaders, give or take a few revolutions wars and other ups and downs. The idea that capitalism was invented by anyone is error. Analysts like Adam Smith, his forebears and followers, described and analysed existing systems. They suggested refinements and improvements but not one of them could effect any change without the will of the elected political leadership - in England expressed by the ballot box popular opinion on who would be the better political party to govern at any particular time. When London forced King John to accede to Magna Carta you can bet he complained about social engineering. As did Charles 1 and so on. This much is trite but why is it important - because, for example, Friedmanesque policy change stands alongside gender politics as an invention of the same polity but of far less import and impact on our lives. Gender politics since the 1920s has had a greater effect on modern life than any other social philosophy. I understand the appeal of authority figures like the late Mr Friedman but his contributions to the reality of modern planetary life pale to those of the suffragettes. Finally I am suspicious of any appeal to "evidence based research" suggesting Boards with women do worse than those with. The relatively unregulated profit based corporate activity of the days of the late 19th century brought progress but also great social harm, and the modern polity would never allow those social conditions to exist again. The "masses" are relatively kind and generous - greed has never been. Economics has always been subordinate to popular will and always will be. Think on this - the greatest increase in human wealth in history has coincided with the almost international social engineering consequent on universal female suffrage. So a few evidence based reports may not be the whole story at all......
The IEA is a hugely well respected forum for serious debate on matters economic who often challenge the prevailing views of the day via constructive and insightful comments therefore your contributions so far are both surprising and perplexing. I am certain the gentlemen in question was merely making the point that in the world of chess at the moment there are infinitely more exceptional male chess players than there are female. There is inevitably going to be exceptions so the there is no need to accept a challenge and as for fear......most doubtful because there is nothing to fear!! The same observation could be applied to business insofar as there are very few female equivalents, at the moment, of Steve Jobs, Bill Gates, Rothschilds family, Jeff Weiner, Eric Schmidt, Richard Bransons etc who have built hugely successful innovative multi national organisations from nothing.
Peter, thanks for your very thought-provoking points. I accept that women entering the world of work have increased human wealth considerably, but I fail to see how that could justify the relentless (and accelerating) political and business ‘direction of travel’ of increasing the representation of women on major corporate boards, and in other senior positions. The five longitudinal studies we cite show that in three major economies (USA, Germany, Norway) this direction of travel has led to corporate financial decline, while not one longitudinal study – from anywhere in the world – has ever shown an improvement. Are you saying corporate financial decline is a price worth paying for the advancement of women? If so, why limit ourselves to women? What about other ‘under-represented’ groups on FTSE100 boards, e.g. rocket scientists, black people, one-legged people, people suffering from Tourette’s Syndrome, deaf Bulgarians who speak no English, people with no business experience, Girl Guides, vicars… the list is endless. Why is it only women who are artificially advanced into senior positions? Because women have learned how to shame alpha males (including politicians such as David Cameron, Vince Cable, businessmen such as the FTSE100 chairmen who are members of the ‘30% club’…) into giving women ever more special treatment, regardless of the consequences to society in general, and men in particular. Women are already over-represented in the cabinet, based on the proportion of Conservative and Lib Dem MPs who are women, yet David Cameron is surely about to increase women’s over-representation yet further, as we reported recently http://j4mb.wordpress.com/2013/07/23/david-cameron-is-about-to-increase-... Mike Buchanan CAMPAIGN FOR MERIT IN BUSINESS http://c4mb.wordpress.com
Oh dear Doris, you dont like women much either do you? Forgive my ungallantry but you are also of "a certain age" arent you? You really don't like those young clever ladies gaining all this power do you. After all, twas different in your day. Peter is right, the picture is much bigger than just a few small bits of highly questionable research and narrow economic reasoning. Social norms have changed, the ladies have gained power and are using it. Twas ever thus with repressed groups throughout the ages. And I have to confess that I know very little about the IEA and am presuming they are part of UKIP, a party of which I really dont know much about either, So, you are definitely well ahead of me there.
Charlie H. Your last post was embarrassing as you continue to make assumptions and flower your input with irrelevancies. You appear to miss the point again perhaps deliberately however your propensity for using offensive personal slights and taking a defensive posture is usually a feature of an individual with a mind-set, when arguing their point, know their rationale is questionable. This behaviour is counter productive and unattractive with overtones of and reminiscent of playschool........you should get it seen to immediately if not sooner!! The UK Chief Medical Officer this week said that many women in senior roles suffer from Imposter Syndrome....of course they do....... if they are given preferential treatment over better qualified and experienced men, or women for that matter, in the corporate or senior public sector recruitment strategy. This would, in my view, only apply to women who through social engineering initiatives have got the jobs merely because they are women whereas women who get to the top on merit do not feel that inferiority. The Imposter Syndrome will only increase as the government continues to pursue its strategy of threatening companies if they don't put more women at senior levels or on boards. If those women know they only got there over more capable men because they wear a skirt they will inevitably feel inferior and ultimately fail. Most men and women do not care who runs the corporate world or public sector organisations however we do care that they are run by the very best people who get there based on merit or we risk the prospect of a slide into mediocrity which in the past few years we have already seen in certain areas. I have no problem with the “clever ladies” you refer to getting senior jobs on merit, but not at the expense of better qualified and experienced men by being given preferential special treatment. The IEA is an independent well-respected organisation affiliated to no political parties where people can have adult discussions about issues which are as the title implies ... economic..... therefore I doubt they will be enamoured by you suggesting that they are part of UKIP - or was that your attempt at denigration for its own sake? Finally...................aren't we all of a certain age Charlie H including you....... however I am open minded about who I debate with......are you?”
Good article and some very useful comments here. However, is the lack of paragraphs in tho comments a technical shortcoming or a deliberate writing style by all commenters?
Anonymous, it's long been the default 'style' for comments on this blog. I wish it were otherwise, but maybe the purpose is to discourage lengthy comments?
Dear Anonymous, Thank you for your comments they are much appreciated. It is a deliberate writing style on my part based on my enthusiasm to get all my thoughts down and so long as the grammar is reasonable I am happy. My English teacher would probably not approve however!!! I did enjoy reading your contribution....most profound. Doris

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