In ancient Rome, the legionnaires had a special maneuver to protect troops during an assault. When under attack soldiers drew in close and used their shields to the front of the group, to the sides, and to cover their heads. It is called the Testudo Formation, inspired from the latin word for turtle.
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Plutarch describes this formation as used by Mark Antony during his invasion of Parthia in 36 BC:
Then the shield-bearers wheeled round and enclosed the light-armed troops within their ranks, dropped down to one knee, and held their shields out as a defensive barrier. The men behind them held their shields over the heads of the first rank, while the third rank did the same for the second rank. The resulting shape, which is a remarkable sight, looks very like a roof, and is the surest protection against arrows, which just glance off it.[3]
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If you read Asterix and Obelix books as a kid you probably remember graphic representations that looked something like:
Once in this formation, the legionnaires must act as one. They walk together, hold the shields together, and plan their course of action together. As soon as the individuals behind all those shields act individually, the testudo fails to preserve the group. And just like on the fields of battle, formations are being formed and disolved all the time.
When you think about it, this aptly describes an economic phenomenon. When people take economic action to change their odds of a bad thing happening to them, when they coordinate with others for self-preservation, then they are engaging in a testudo formation. Everyone behind the sheilds benefits from the collaboration. Everyone outside the armored cloaking is either an advisory or left to fend for themselves.
Economic action to the outside of the legionnaires is competitive and follows the private market rules. Everything from within is public and follows public market principles.
This is important because the analysis thus far tried to follow the cause instead of the group. For instance, if you advocate for clean energy, advocates tell us to always choose renewables instead of fossil fuel, a gas instead of coal, etc. This evalutaion of priorities is to be honored by developping countries or western countries alike. But what we see is that this aspirational ordering does not hold up consistently in each market.
Due to the war in Ukraine, the European energy market is suffering from a lack of Russian oil. Instead of pursuing clean energy of any form, policymakers are choosing to revert to coal. Their testudo formation is battling other adversaries. Some of these are internal. This isn’t bad or good. It is simply a reality. But it is understanding where the testudo formations are occurring which allows for a proper analysis of the economic tradeoffs.
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