'Finance, by and large, has gotten away with it'

Innovation thinker and former journalist Charles Leadbeater gave his own views on the Irish crisis during a trip to Dublin

'WHAT'S GOING to happen?" asks Charles Leadbeater, new media analyst, innovation thinker, ex-Blair adviser and former Financial Timesjournalist.

“The Chinese are going to end up owning AIB and O’Leary will own Aer Lingus.”

With this casual but confident piece of futurology, Leadbeater settles into his hotel armchair, still digesting the latest euro zone crisis updates, and clearly still recovering from the previous night’s delay on his Aer Lingus flight from Heathrow.

Happily, the subject on which he addressed the Dublin Chamber business lunch on Friday was a more obviously upbeat one: “the art of the comeback”.

Leadbeater’s eclectic bunch of comeback kids include Finland of the 1990s, the subject every economist and banking analyst in Ireland has suddenly become an expert on. IBM, which “fell off a cliff”, but clawed its way back up the cliff-face, also makes the cut. “They thought about products, but they hadn’t thought about need,” he concludes.

Then there’s the suspension bridge, an 18th-century invention that achieved early success back in the days when “they had no theories, no models, they just built them”.

Fast forward to the 20th century, and the planners of the Tacoma Narrows bridge in the US state of Washington started thinking about ways to do it on the cheap, with shallower supports. The result was a wind-induced collapse in 1940.

“I don’t want to draw a comparison between suspension bridges and Ireland, but it was an overly flimsy structure that proved to be unstable in a big wind.”

The lesson of the suspension bridge is that in order to make a comeback, you have to first figure out the mistake you made, then admit to it, he says.

“Eventually they realised it wasn’t the suspension bridge model that was at fault, but the proportions. They junked the highfalutin’ theory and went back to more basic concepts.”

Leadbeater, who has provided advice on innovation and internet strategies to everyone from the Chinese government to the Royal Shakespeare Company – via Vodafone, the BBC and the European Commission – would like the economic system to go back to more basic concepts, too.

An article he wrote for the Spectatormagazine two years ago declared that deregulated, bonus-driven, free-market triumphalism in capital markets had reached its high-water mark.

“Nick Leeson was a rogue trader. Enron was a rogue company. Financial markets have become a rogue system,” he wrote, outlining a vision where a “more modest, thrifty and subdued” capitalism would emerge, with a greater degree of social enterprise thrown in.

But the “rogue system” has not been dismantled at the pace that he and the Washington dinner party circuit expected in those post-Lehmans months.

“Finance, by and large, has gotten away with it,” he says.

“It’s extraordinary.”

The model of “raising more tax to pay for more nurses” is over. “That worked for the last 10 years, it won’t work for the next 10 years,” he believes.

Leadbeater, whose books include We-think: The Power of Mass Creativityand Living on Thin Air, was a newspaper journalist up until 1996, when he turned independent author and adviser. "I still consider myself part of the media," he says.

After stints as labour editor, industrial editor, Tokyo bureau chief and features editor for the Financial Times, he moved to the London Independent, where his features role involved commissioning Helen Fielding to write the original column of Bridget Jones's diary.

Leadbeater has had plenty to say about the decline of traditional media, likening big media groups to “boulders” that are being swept away by a growing tide of “pebbles” – that YouTube hit, that Facebook page, those Google-able independent bloggers. New media companies such as Google, Facebook and YouTube deal in pebbles, he says. The “boulders” now have to become “beachcombers”, aggregating and monetising the pebbles.

So how does he assess the position of his former employers?

“The Financial Times is strong. It’s niche,” he says. The Independent is “struggling”, though he’s interested in the possibilities posed by the new bite-sized 20p version, launched last month for “lapsed newspaper readers”.

Leadbeater recalls meeting the Swedish founder of the Metro model of freesheet newspapers in the early 1990s.

“He is sort of why I gave up working in newspapers. He said basically that journalism was a logistics business: it’s about getting information to particular people at a particular time.”

He sniffs at the lack of romance.

"And I thought that's not why I got into journalism, to be in the logistics business. I got into it because of Watergate and Harold Evans and the Sunday Times," he says nostalgically, as he's whisked away into his next meeting.