Analyzing "Home Court" Political Risk

Until recently, geopolitically focused risk intelligence professionals were rarely called upon to discuss political risk related to US policy and US political actors. More frequently their jobs required analysis of security or geopolitical issues taking place outside the country with an eye toward implications for their US based organization. But in the last year, our clients have called upon us more to look at political risk emanating from stateside actors and events than the collective few years prior combined. Conversations with peers at other firms and organizations have confirmed this trend. As many an analyst has noted this year, analyzing events on your home turf - whether that is the US, UK, or any other country in the world - can be treacherous waters to tread. But that doesn’t mean we should avoid these opportunities or consider them too complex to navigate. In fact, the challenge of doing so can make us better analysts.

 Here are a few suggestions to make these tricky projects a little easier:

 Examine the policy, not the policymaker.

 One of the primary challenges we face in examining political risk on our home turf is an increasingly polarized electorate (this holds true from the US to the Middle East to Asia). While these sensitivities exist when analyzing overseas issues as well, we are generally far enough removed from them that we can provide a relative outsider viewpoint. With respect to analyzing political issues on the “home court” however, everyone has skin in the game. Because of that, it is much easier to offend or polarize with analysis that is directly focused on a particular player or group of individuals. Removing the actor from the analysis – and focusing on the policies or decisions driving a particular crisis or concern – helps to remove the emotion from the analysis. This lessens the chance that the reader will react to negative or positive language around polarizing individuals.

Account for your bias.

Everyone has biases – and the more aware we are of these, the better we can do our jobs. Several months ago Quartz published an article called “You are most definitely not living in reality, because your brain doesn’t want you to.” A must read for every analyst, this article breaks down biases into four digestible categories and helps the reader understand why the brain creates these biases and how. As analysts, we are likely to be more aware of these, but also more likely to be tricked by our brains into making snap judgments based on too little data or by giving too much weight to particularly large or memorable security related events, like a major terror attack. These biases will be especially apparent when discussing issues that hit close to home – making it that much more important that we “red team” our assumptions and analysis with colleagues with different political views, ensure that we are pulling from sources across the political spectrum, and backing up our analysis with hard data and not just media reports.

Read overseas publications, media and editorials.

Just as intelligence professionals struggle covering their own countries, media outlets do as well. Particularly because we are often looking at how a policy may impact our overseas operations or personnel, it is crucial to understand how political risk is playing within other markets – especially those that will be heavily impacted by sharp changes in policy. After the US President’s Joint Address to the US Congress on February 28, for example, US media reaction and stories were fairly predictable across the board. However, a company with significant supply chain, manufacturing, or commercial interests in China would want to read a lot more articles like this one – which discusses how Chinese analysts reacted to the address. Similarly, non-US based think tanks – such as Chatham House in London, the International Institute for Strategic Studies in Singapore or the Lowy Institute in Australia, will also provide varied insights that might not be gained by reading US based publications.

Avoid the use of emotive adjectives. 

Avoid the use of adjectives altogether when you can. While useful for writing descriptive narrative, in analysis excessive use of adjectives often serves no purpose other than to provide a giveaway about the author’s feelings on a subject. And while they sometimes serve an editorial purpose, opinions based on emotion differ markedly from analysis. Be cautious about the use of any adjective that suggests a value judgment that can be misunderstood. Words like “massive, dangerous, very, enormous, and violent,” that can mean different things to different readers generally add little value to analysis – and frequently undermine it. In a politically charged climate where intelligence teams may be tasked with writing on everything from immigration and trade policy to political protests in their home country – adjectives like these will look like value judgments to many readers. In turn, this perception will undermine the analysis and the intelligence team’s credibility.

 Avoid making linear projections or forecasts.

Regarding US political risk, the chances of being right in predicting a straight line outcome of US policy ideas at this early stage of a new administration is next to 0. While this may change as the administration finds its footing and begins to work better with Washington, the current state of affairs (not unlike the beginning of any new administration), will involve significant testing of the US electorate and US allies to see what “sticks” and what doesn’t. At such an uncertain time, analysts need to be cautious with their analysis, study carefully the reactions of the public and foreign governments, and build confident, but multi-factor analysis that provides insight based on a range of possible outcomes.

Use this as an opportunity for growth and learning.

Our inherent bias about our home country, potential disagreement with political decisions and their impacts on our organizations or personal situation, and the likely stronger disagreement from customers who may view the situation differently can all align to make "home court" analysis more complicated and politically challenging – even for experienced analysts. But most of the time we can’t turn down these requests, nor should we. Instead, use it as an opportunity to improve your skills, examine your biases and learn better ways to communicate in your writing and analysis. In the process, we may just learn more about our country and ourselves.