German leaders, mistaken impressions and unintended consequences
I offer this without comment except with a brief one at the end. The first extract is from BBC economic correspondent Robert Peston's blog. for 5th and 6th October 2008 about falls in confidence in European banks . The second is an extract on the fall of the Berlin Wall from my Critique of Game Theory. See if you can spot any similarities.
German Guarantee Lost in Translation
Robert Peston. 5 Oct 08, 08:35 PM: I don't now expect an immediate decision by the Chancellor of the Exchequer to follow the example of the Germans and offer a full 100% guarantee to protect the savings of ordinary retail savers. Why not? Well Alistair Darling and the Treasury can't get any sense out of the German government about what it is precisely that they are doing. So there's no point in responding to something that's still a touch ephemeral. Robert Peston, 6 Oct 08, 10:27 AM: It gets weirder. My official sources tell me that the German government is not legislating to formally increase protection for savers. What Angela Merkel did, they say, was give a "political" commitment that no German savers would lose a penny - which is more-or-less identical to the commitment given by our Chancellor of the Exchequer, Alistair Darling. But the horse has already bolted - in that this morning the Danes have given an unlimited guarantee to their savers and the Swedes have massively increased the level of protection they offer. Whether the German or British governments like it, there does appear to be a clear trend towards almost total protection for European retail depositors.
The Fall of the Berlin Wall
at the end of reading out a long press release in East Berlin, a party boss, Schabowski, gave the mistaken impression that anyone who wished to go to the West could do so immediately, when the actual intention instead was to relax the rules in a controlled and managed fashion. This error was compounded with TV and radio mistakenly reporting that Schabowski's announcement meant that the Wall was open. Thousands of jubilant East Berliners headed for, and through, the checkpoints, overwhelming the equally confused and astonished guards who were faced with the choice of giving way or massacring thousands. "Through ineptitude on the part of the (East German government) the Berlin Wall had been inadvertently breached" (Turner, 1992, p.234). And once the Wall was breached, it was impossible to rein in the expectations that those in the East could now travel freely back and forward to the West. After that, the actual physical dismantling of the Wall started with spontaneous popular action and also had nothing to do with government strategy. The rest is history, and as is the case with so much of history, tends to reflect accident rather than deliberate strategy.
Game Theory as Dogma, Neil Kay
Neil Kay October 6th 2008