The Business Case for Depolarization

"I hope I’ve convinced you that polarization poses a risk. I hope I've convinced you that it deserves our attention. I hope I've also made the case that the solution can be bottom up."

Usually, when I talk to this group of Travelers’ senior leaders, I focus on what’s happening, as we say, “under the umbrella.” We talk about our Mission: creating shareholder value, and how that’s linked to our Purpose: taking care of the people we’re privileged to serve – our customers, our communities, and each other. We refer to that as the Travelers Promise.  And then I share a case study that helps inform my thinking – and hopefully yours – about how we can satisfy that mission and fulfill that promise.

Today, I’m going to change it up in two ways. First, I’m going to focus on what’s happening outside of the umbrella. And second, today’s case study is going to be a little bit different. For one thing, it starts with a song: Sunday Bloody Sunday by U2 – one of the greatest hits from one of the greatest bands of all time. 

If you’re like me, you’ve heard it a thousand times. But maybe you never paid that much attention to the lyrics. The song is about a tragic day in the early 70s during the decades-long sectarian conflict in Northern Ireland, the so-called Troubles.      

On some level, that conflict feels like ancient history. But this past April marks just the 25th anniversary of the Good Friday Agreement that brought an end to the violence. I’m going to get to why I think this is relevant to us in a minute, but before we look ahead, let’s take a minute and look back about 100 years. That’s when Ireland as we know it came into existence. 

An Irish war for independence from the UK in the early 20th century led to new lines on the map. In 1920, the island was partitioned into two; Southern Ireland became an independent country, the Republic of Ireland. The six counties in the northern part, Northern Ireland, remained part of the UK.

Now, the challenge from day one in Northern Ireland is that it was polarized along religious lines. The breakdown was about 60% Protestant, 35% Catholic. That was in stark contrast to the Republic of Ireland, which was about 93% Catholic. 

The divisions in Northern Ireland were particularly sharp – geographically, culturally, politically. The polarization didn’t just determine where you lived. The polarization determined just about everything – what clubs you belonged to, which businesses you shopped at, which newspapers you read, where your kids went to school. It even determined your vocabulary. A famous example is the Northern Irish city that the Protestants called Londonderry, and most Catholics called Derry. If you’ve watched the comedy series called Derry Girls, which is set during the later years of the Troubles, there’s a funny but telling scene where kids try to list things that Catholics and Protestants have in common, and they can only come up with differences.  

If it seems hard to imagine living in a society that polarized, I want you to hold that thought. What’s easier to imagine, though, is that polarization that deep can set the stage for conflict.

And sure enough, that brewing political and social divide ignited in the 1960s. On one side were the predominantly Catholic “Republicans” who wanted to see Northern Ireland rejoin the Republic of Ireland. And on the other side were the predominantly Protestant “Unionists” who feared losing their cultural and political ties to Great Britain. There wasn’t one moment when the Troubles began. Instead, it was a spiral that turned from peaceful protests, into street clashes with security services, into flashpoint tragedies like Bloody Sunday in 1972 that drew the world’s attention, into open paramilitary conflict. 

This slow-motion disaster ebbed and flowed for about 30 years, during which time there were more than 16,000 bombs detonated, mostly in civilian areas, tens of thousands of adults joined paramilitary organizations, and more than 3,500 people were killed – the majority of them civilians.

The violence also decimated Northern Ireland’s economy. In downtown Derry – or Londonderry – nearly 2,000 businesses were destroyed. Now remember, these aren’t the consequences of a full-blown Civil War. This was “mere” societal polarization.

In the recent documentary Once Upon a Time in Northern Ireland, one woman who lived through the Troubles summarized it this way, with regret: “If you live in a segregated community, you’re growing up in ignorance. And ignorance generates hate. And hate begets hate begets violence. And that’s what we did to each other here.” 

She was talking about Northern Ireland decades ago, but she’s making a point that’s deeply relevant to the United States and, as a result, to Travelers today. 

Now let me pause here: Do I think that the United States is on the brink of becoming Northern Ireland in 1972, the year of Bloody Sunday? No, I don’t … but … 

Let’s not forget there’s political violence in our history – the assassinations of JFK, RFK, and MLK in the 1960s. The Oklahoma City bombing more recently. We could go on and create a much longer list of political violence in the US. 

And we’re clearly not in harmony today. Research shows that, today, many of us – Democrats and Republicans – don’t want our kids to marry outside of their political party. That wasn’t true historically. A study by Reuters found that political violence in the United States is at its worst since the 1970s. And the trajectory is not so encouraging. A 2021 poll found that a majority of Americans now see other Americans as the biggest threat to their way of life. I don’t know about you, but I find that shocking. And then there’s this: According to data from the Public Religion Research Institute, an increasing percentage of Republicans, Democrats, and Independents, say that “patriots” may have to resort to violence to save the United States. Think about that     ,      a significant number of Americans believe that “patriots” have a duty to resort to violence to save the United States.

So maybe we’re not Northern Ireland in 1972, but I’m not sure we ought to take a whole lot of comfort in that. Because we might be Northern Ireland in the mid-1960s on the way to 1972. And with a presidential election coming up, we should be concerned that the volume and heat are going to go up – maybe way up.

Now, I don’t think this is the environment that we want to raise our kids and our grandkids in. But I acknowledge that’s a different speech for a different soapbox. I’m talking about this today because it’s a problem for our business. Let me put a finer point on that.

Two-thirds of our fourth graders can’t read at grade level; that’s our future workforce. No matter where you stand on the immigration debate, a record number of migrants are reaching the US-Mexican border, and a record number have lost their lives on what the United Nations migration agency now calls “the deadliest land crossing in the world.” Mayor Eric Adams has declared the migrant crisis will destroy New York City, and New York City is far from the only city dealing with that crisis. As a country, our health care costs are sky high, but our health care outcomes rank at the bottom of developed countries. And more than half a million Americans are homeless, a disproportionate number of them veterans. The list of national challenges is long and getting longer. 

But when all we can think about is how much we dislike, even hate, the other side, we shouldn’t expect to get anything done. In fact, we’ve stopped debating the big issues altogether. 

When you’re in the business of ensuring the output of the economy, as Travelers is, that lack of forward momentum can put downward pressure on important economic activity that drives our top and bottom lines. If you ask Jamie Dimon, the Chairman and CEO of JP Morgan Chase, it already has.

In a recent interview with The Economist, he pointed out that our nation’s growth over the past couple of decades was roughly 1.7% a year, and then he asked: why wasn’t it 3%? In his words, “I personally believe it’s because we’ve done a terrible job on immigration, taxation, mortgages, affordable housing, and health care.” He then pointed out that 3% would mean $15,000 more GDP per person. Again, I’m quoting, “That would have paid for better safety nets, that would have paid for more military, it would have paid for more schooling, whatever you think we need to do more of.” 

Fifteen thousand dollars in additional GDP per person in the United States. That’s a huge number. Whatever you think we should be doing more of, whatever problems you would like to be solving, we’re not – because gridlock isn’t constructive. And that is very bad for our business. 

Let’s regroup. I hope I’ve persuaded you that we’ve got a problem of polarization in this country. And in a minute, I’m going to get to our role in addressing that problem. But first, understanding how we got here may provide some important context in understanding how to get out of here. 

So let’s move from Northern Ireland to the United States. And let’s talk about three big interrelated trends. 

The first has to do with demographics. In the past several decades, there has been a huge change in the distribution of the population in the United States. In his book The Big Sort, Bill Bishop notes that for much of American history, economic opportunity has been the primary consideration for people when they decide where and when to move. Think about the Gold Rush in the 1840s, or 100 years later, when Silicon Valley became the tech capital of the world and the Bay Area boomed. Or think about the oil boom that made Texas one of the fastest growing states in the country. But today, Bishop argues, people choose where to live based on lifestyle, which includes neighbors who share our tastes and values. Now over time, that’s led the country to sort itself into bubbles. Not all that long ago, most Americans had the shared experiences of watching finales of Seinfeld and Dallas. But today, Succession is the most popular show in blue cities like New York and San Francisco, while Yellowstone wins in red cities like Oklahoma City and Greensboro. 

It turns out that sorting has real consequences for democracy. In 1976, only 26% of voters lived in counties where one presidential candidate won by a landslide. In other words, in 1976, most of us lived in politically diverse places. Three decades later, that number nearly doubled to about 50%. By the 2016 election, it was 60%. Our neighbors increasingly share our political affiliation. Now, for some of us, that’s very comforting. But it comes at a price. Because when we’re only exposed to people who are like-minded, our beliefs tend to become more and more extreme. That’s the so-called “law of group polarization” made famous two decades ago by Cass Sunstein. Group Polarization research has found, among other things, that if you give a like-minded group enough time together, they will become, as a group, more extreme than the most extreme person was at the start of the deliberation.

Now, let’s layer on top of that a second phenomenon. Over the past several decades, no matter where we live, the average American has been participating in community less and spending less time with others. Robert Putnam, a Harvard political scientist, wrote about it in a groundbreaking book called Bowling Alone. The name comes from the very significant decline in bowling leagues in the United States from 1950 to 2000. But of course, bowling is just an example. Across the board, Americans have been less and less likely to participate in community activities. Putnam found a 50% decline in club meeting attendance, a 43% decline in family dinners, and a 35% decline in having friends over. 

So what’s going on? There are a few theories. It might have to do with the rise of suburban living, where the nearest gathering place could be miles away and inconvenient to get to. It might have to do with the rise of TV and later, digital media – spending time on screens that used to be spent socializing. 

Whatever the cause, the effect is clear. Our social ties are getting weaker. That’s a problem for a lot of reasons. But from a polarization standpoint, studies have repeatedly shown that isolation drives people to more extreme views. 

Against this backdrop of demographic sorting and isolation, there is a third propellant, a third phenomenon: social media and information bubbles. To many of us, social media might feel like a digital town square. But we can’t forget that these are actually advertising businesses, and they’re intentionally divisive. As Tristan Harris, the executive director of the Center for Humane Technology, has pointed out in a 60 Minutes interview, “The more morally outrageous language you use, the more inflammatory language, contemptuous language, the more indignation you use, the more it will get shared. So we are being rewarded for being division entrepreneurs. The better you are at innovating a new way to be divisive, we will pay you in more likes, followers, and retweets. [These platforms are] supercharging the worst parts of ourselves.” 

Now that feels like it ought to be an alarming dynamic. But it’s not the only one at play. Today, depending on how you’ve been sorted, algorithms feed you a very different view of the news. Here’s what that looks like in practice. Every month, the Federal Bureau of Labor Statistics reports how many jobs were created in the previous month. It’s essentially a press release with some statistics – a recent example from November 2022 shows 263,000 new jobs and the unemployment rate unchanged at 3.7%. It doesn’t really get any more straightforward than that. 

But here’s a real headline you may have seen on a red newsfeed: “November jobs report was not a blowout, it was a big disappointment.” And here’s what you may have seen on a blue newsfeed: “New job totals beat expectations as U.S. hot streak continues.” Now if you read the full articles under each of those headlines, they made pretty good points. And if you had read both of them, you probably had a pretty good and nuanced view of the labor market in November of 2022. But if you’re only getting your information from polarized news sources, you’re only seeing information that flatters what you already believe. And it makes you angry at the other side. And apparently, none of this is actually making us care more. It’s just making us hate the other side more. Data show that Americans hate political opponents more than they love their own party.

So, we’ve got the big sort segregating us demographically and subjecting us to the Law of Group Polarization. We’ve got bowling alone, driving a participation crisis and isolating us from others. And we’ve got a new media landscape where profitability is driven by division.

Now, the upshot of all of this is that before we were sorted, atomized and polarized, society’s ideology was represented by a bell curve. Research from the nonpartisan Pew Research Center shows that the median Democrat wasn’t all that far from the median Republican. Today, it’s more like a U-curve. 

Now, let me pause here and state the obvious. This all feels a little bit grim, hopeless, maybe even intractable. Look how far apart we’ve grown. 

But as the social psychologist and NYU Stern School of Business professor Jonathan Haidt pointed out in a 60 Minutes interview, most of the vitriol being aired right now comes from a very small percentage of the population – less than ten percent at each extreme.

In his words, “The moderate majority is either exhausted or intimidated.” 

Haidt says this leads to “structural stupidity” – where the rest of us go silent leaving the extremes in control.   

According to a study called Hidden Tribes, there aren’t two big political identities in America; there are seven. 14% of us are at the most extreme, polarized ends of our U-curve. But that means 86% of us have ceded the floor to this small and extreme minority. 

Here’s a perfect example. We barely averted a government shutdown last September. Representative Mike Simpson, a Republican from Idaho, summed it up like this in a quote reported by The New York Times, “The problem is we’re being dragged around by 20 people when 200 of us are in agreement.” 

I take his point. Giving control to a small group seems like a bad idea. And we’ve let these forces do that to us. But that Hidden Tribes study ought to give us some hope. Change may be as simple as the rest of us asserting ourselves. If enough of us assert ourselves, maybe we can start to pivot from estrangement to engagement. 

Now, that feels a little ambitious, right? A little far-fetched.

But let me bring you back to Belfast and tell you how The Troubles ended.      

In the middle of The Troubles, it must have felt like it would never end. Kind of like deep polarization feels to us now. But from our vantage point today, we know that it did.

So how did it happen? Maybe one side won? Maybe political leaders saw the light? 

No. Neither of those things happened. 

Here’s what happened: A divided people gathered in peace rallies across Northern Ireland.

They sent a message to the paramilitaries: “We don’t want you anymore.” Ordinary citizens got together and said, “enough is enough.” When the political leaders were forced to the table, it resulted in the historic Good Friday Agreement. And regular people, exhausted from all the division, endorsed that promise overwhelmingly at the ballot box in a 1998 referendum. 

Now, you already know that the compromise was largely successful at its core goal of ending the violence, but there’s a little bit more to the story. It turns out the Good Friday Agreement delivered more than peace and quiet. It also delivered prosperity. Recently, Northern Ireland has grown faster than the UK as a whole. And peace, quiet and economic promise yielded a recent headline that was unimaginable not so long ago: “Northern Ireland is the happiest place to live in the UK.” Pretty remarkable.

So what does it all mean? 

I hope I’ve convinced you that polarization poses a risk. I hope I’ve convinced you that it deserves our attention. I hope I’ve also made the case that the solution can be bottom up. 

I’ve got one more goal today, which is to convince you that we – the 687 people in this room, and the more than 30,000 people that make up the Traveler’s family – have a role to play. If the concern is that we’re Northern Ireland in the mid-1960s on our way to Northern Ireland in 1972, then I think we’ve got a responsibility to change the trajectory. 

In fact, I wrote this in our most recent annual letter to shareholders, “We do not take for granted that our ability to fulfill our promise rests upon the environment in which we operate: a representative democracy built on resilient public institutions, and an economic system governed by the rule of law. That’s why we take seriously our role in preserving these institutions, and our responsibility to help pass them on to future generations.” 

I believe there’s two simple things we can do to fulfill that responsibility. 

First, reject polarization by choosing pluralism. The end of the Troubles didn’t end political and ideological divisions. People are still Catholic and Protestant. Those identities still matter. What changed the trajectory in Northern Ireland is that people chose pluralism. We can too. In fact, there’s nothing more American. Pluralism is just this idea that a society can be united despite being politically and ideologically divided. It’s an idea that goes back to our nation’s founding. History buffs in the room will remember James Madison and the Federalist Papers. This was Federalist #10. As David French argues in his book Divided We Fall, solving our political crisis requires returning to those roots. And that starts with a mindset shift – remembering that we can hold dear every belief that’s important to us, and at the same time, believe that others have a right to theirs. According to French, doing that requires something simple but profound: decency. It’s a very thoughtful book. French has influenced my thinking on this topic, including some of what I’ve shared with you today, and there’s a copy waiting for you in the lobby.

And that brings me to the second thing I think we should do, which is reject estrangement and choose engagement. We’ve got big problems to solve. We’ve got a big country to run. And civic engagement matters. We’ve got to find a way to work together. Ronald Reagan, a Republican, and Tip O’Neill, a Democrat, personified what that looks like. So did RBG and Justice Scalia. They couldn’t have been further apart ideologically, but they vacationed together. 

In his book, The Bill of Obligations, the great diplomat Richard Haass identifies 10 things each of us can do to engage. There are also copies of his book waiting for you outside, and I encourage you to read it.

But we can find more great examples, not on the page, but right here at Travelers. Through our civic engagement initiative, Citizen Travelers, our colleagues across the business have taken it upon themselves to get involved in their communities, to choose pluralism and in their own way to change the trajectory of our polarized moment. Elizabeth Marlin is a great example. She and her Neighborhood Council took the initiative to pull together an inventory of abandoned properties in Spokane, Washington, and then Elizabeth connected with Habitat for Humanity, which purchased and renovated some of the homes. When people saw the changes, they joined in – and together they transformed the entire neighborhood. As Elizabeth said, “I hear from people that ‘they’ should fix it. Someone should fix this problem. I hate to break this to people, ‘they’ are not coming.”

Elizabeth is just one of the many reasons I’m optimistic that we can contribute to a solution, because we already are. Whether it’s our company or whether it’s our country, there’s a lot at stake. Our democracy and the inclusive prosperity that it makes possible are at risk, and they’re worth fighting for. They may not be coming, but we are. It’s up to us.  

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