by Pritish Nandy
Call it conflict. Call it confrontation. Or
call it simply the dialectic of growth. Whatever you call it, clashes
take the world ahead. We may talk endlessly about peace and stability,
how crucial continuity is. But what brings about change and opens up new
ideas, new markets, new opportunities is always conflict. It breaks the
status quo, creates the momentum for change. In the process, the world
transforms.
Yes, every time a person, a brand or an institution
comes under threat, the world changes. It forces us to think afresh. The
classic example is when Pepsi challenged Coke, we all recognised for
the first time the amazing elasticity of demand for a fizzy drink. Or
when Penthouse challenged Playboy and converted what was till then a
niche business into one of the world’s biggest industries. To take a
recent example, when Anil and Mukesh fought, it appeared self defeating
and long dirges were written about the demise of the great Ambani
empire. Two years later, we found just the opposite had happened. The
conflict had quadrupled their collective wealth. Similarly, if there is
one thing that can resuscitate our moribund politics, it is Anna’s
aggressive campaign that has woken up a lazy, corrupt Government to its
responsibilities. As indeed it has woken up an equally lazy, corrupt
Opposition to its opportunities.
So, if conflict is the
catalyst for change, why do we constantly enshrine the importance of
harmony, reconciliation, freedom from strife? Every spiritual guru talks
about it. So do political leaders. Even businessmen claim that
stability is the only way for the world to progress and prosper. If
stability goes, we are warned, the markets would collapse. So would the
world. Actually, the contrary is true. Even though it appear to be
bloody and unseemly, conflict is good for business, politics and, often,
even human rights. The status quo invariably represents exploitation,
corruption, the perpetuation of wrong. It also represents the lack of
free thought. If we did not have enough conflicts, the world would rot.
Great
religions grew from conflict. Every emerging sect and sub sect may have
drawn blood during its birth and baptism but eventually they grew the
size of the following and gave these faiths their cutting edge, to see
them through difficult times. So, even as religions denounce violence,
the truth is that it is violence that enlarged their domain. The benign
perish, unsung. The gentle leader remains enshrined in our hearts but no
longer relevant in a world we have created for ourselves where only
strife moves us ahead. If Osama did not exist, we would have had to
create him. (And some say we did.)
Godse kept Gandhi alive by
assassinating him. Or else, we would have forgotten him even in his
lifetime. Like the world forgot Mikhail Gorbachev. Violence, anger,
bloodshed are the highpoints we celebrate as history. Our wars are what
define us as nations, as the map of the world is being constantly
redrawn. Empires are shrinking. New nations are being born.
New
instruments of conflict keep being discovered. These are the new change
agents. So when Sibal protests against social networking sites he is
doing exactly what every Government wants to do: Preserve the status
quo. For in the status quo lies their only hope of clinging onto power.
That is why every re-election campaign starts with the promise of
stability. It is the perpetuation of the myth that what exists is
perfect. What could follow may be dangerous.
But the modern
world exists because it flirts with danger. Conflict creates markets.
Conflict brings us change. Conflict opens up new opportunities,
redefines existing social structures, gives hope to the underprivileged,
the trampled upon. It teaches us the importance of constant change. Sun
Tzu is the philosopher of our times. He teaches us that we must not run
away from conflict but win it artfully and use it to change our lives.
The
Tomsk court is not wrong. The Bhagawad Gita teaches us exactly this,
and more. It teaches us that it is our moral duty to fight every war and
win it instead of whimpering about peace and stability, right and
wrong. In that sense, it is indeed extremist literature for our
extremist times. It is that rare manual for survival in the age of
bloody, bare knuckled fights. To ban it would be stupid. To learn from
it would be apt.
Tuesday 20 December 2011
Good Minus God
The Stone is a forum for contemporary philosophers on issues both timely and timeless.
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I was heartened to learn recently that atheists are no longer the most reviled group in the United States: according to the political scientists Robert Putnam and David Campbell, we’ve been overtaken by the Tea Party. But even as I was high-fiving my fellow apostates (“We’re number two! We’re number two!”), I was wondering anew: why do so many people dislike atheists?
Atheism does not entail that anything goes. Quite the opposite.
Well, actually — no, it’s not. (And for the record, Dostoevsky never said it was.) Atheism does not entail that anything goes.
Admittedly, some atheists are nihilists. (Unfortunately, they’re the ones who get the most press.) But such atheists’ repudiation of morality stems more from an antecedent cynicism about ethics than from any philosophical view about the divine. According to these nihilistic atheists, “morality” is just part of a fairy tale we tell each other in order to keep our innate, bestial selfishness (mostly) under control. Belief in objective “oughts” and “ought nots,” they say, must fall away once we realize that there is no universal enforcer to dish out rewards and punishments in the afterlife. We’re left with pure self-interest, more or less enlightened.
This is a Hobbesian view: in the state of nature “[t]he notions of right and wrong, justice and injustice have no place. Where there is no common power, there is no law: where no law, no injustice.” But no atheist has to agree with this account of morality, and lots of us do not. We “moralistic atheists” do not see right and wrong as artifacts of a divine protection racket. Rather, we find moral value to be immanent in the natural world, arising from the vulnerabilities of sentient beings and from the capacities of rational beings to recognize and to respond to those vulnerabilities and capacities in others.
Leif Parsons
This view of the basis of morality is hardly incompatible with religious belief. Indeed, anyone who believes that God made human beings in His image believes something like this — that there is a moral dimension of things, and that it is in our ability to apprehend it that we resemble the divine. Accordingly, many theists, like many atheists, believe that moral value is inherent in morally valuable things. Things don’t become morally valuable because God prefers them; God prefers them because they are morally valuable. At least this is what I was taught as a girl, growing up Catholic: that we could see that God was good because of the things He commands us to do. If helping the poor were not a good thing on its own, it wouldn’t be much to God’s credit that He makes charity a duty.
It may surprise some people to learn that theists ever take this position, but it shouldn’t. This position is not only consistent with belief in God, it is, I contend, a more pious position than its opposite. It is only if morality is independent of God that we can make moral sense out of religious worship. It is only if morality is independent of God that any person can have a moral basis for adhering to God’s commands.
Let me explain why. First let’s take a cold hard look at the consequences of pinning morality to the existence of God. Consider the following moral judgments — judgments that seem to me to be obviously true:
• It is wrong to drive people from their homes or to kill them because you want their land.
• It is wrong to enslave people.
• It is wrong to torture prisoners of war.
• Anyone who witnesses genocide, or enslavement, or torture, is morally required
to try to stop it.
To say that morality depends on the existence of God is to say that none of these specific moral judgments is true unless God exists. That seems to me to be a remarkable claim. If God turned out not to exist — then slavery would be O.K.? There’d be nothing wrong with torture? The pain of another human being would mean nothing?
Think now about our personal relations — how we love our parents, our children, our life partners, our friends. To say that the moral worth of these individuals depends on the existence of God is to say that these people are, in themselves, worth nothing — that the concern we feel for their well being has no more ethical significance than the concern some people feel for their boats or their cars. It is to say that the historical connections we value, the traits of character and personality that we love — all count for nothing in themselves. Other people warrant our concern only because they are valued by someone else — in this case, God. (Imagine telling a child: “You are not inherently lovable. I love you only because I love your father, and it is my duty to love anything he loves.”)
What could make anyone think such things? Ironically, I think the answer is: the same picture of morality that lies behind atheistic nihilism. It’s the view that the only kind of “obligation” there could possibly be is the kind that is disciplined by promise of reward or threat of punishment. Such a view cannot find or comprehend any value inherent in the nature of things, value that could warrant particular attitudes and behavior on the part of anyone who can apprehend it. For someone who thinks that another being’s pain is not in itself a reason to give aid, or that the welfare of a loved one is not on its own enough to justify sacrifice, it is only the Divine Sovereign that stands between us and — as Hobbes put it — the war of “all against all.”
This will seem a harsh judgment on the many theists who subscribe to what is called Divine Command Theory — the view that what is morally good is constituted by what God commands. Defenders of D.C.T. will say that their theory explains a variety of things about morality that non-theistic accounts of moral value cannot, and that it should be preferred for that reason. For example, they will say that atheists cannot explain the objectivity of morality — how there could be moral truths that are independent of any human being’s attitudes, will or knowledge, and how moral truths could hold universally. It is true that D.C.T. would explain these things. If God exists, then He exists independently of human beings and their attitudes, and so His commands do, too. If we didn’t invent God, then we didn’t invent His commands, and hence didn’t invent morality. We can be ignorant of God’s will, and hence mistaken about what is morally good. Because God is omnipresent, His commands apply to all people at all times and in all places.
Whatever the gods love — bingo! — that’s pious. But what if they change their minds?
The problem I’m pointing to is an ancient one, discussed by Plato. In his dialogue “Euthyphro,” the eponymous character tries to explain his conception of piety to Socrates: “the pious acts,” Euthyphro says, are those which are loved by the gods.” But Socrates finds this definition ambiguous, and asks Euthyphro: “are the pious acts pious because they are loved by the gods, or are the pious acts loved by the gods because they are pious?”
What’s the difference? Well, if the first reading is correct, then it’s the gods’ loving those particular acts that makes them count as pious acts, that grounds their piousness. “Pious,” on this alternative, is just shorthand for “something the gods love.” Whatever the gods happen to love — bingo! — that’s pious. If the gods change their preferences on a whim — and they did, if Homer knew his stuff — then the things that are pious change right along with them. In contrast, on the second reading, pious acts are presumed to have a distinctive, substantive property in common, a property in virtue of which the gods love them, a property that explains why the gods love them.
Translated into contemporary terms, the question Socrates is asking is this: are morally good actions morally good simply in virtue of God’s favoring them? Or does God favor them because they are — independently of His favoring them — morally good? D.C.T. picks the first option; it says that it’s the mere fact that God favors them that makes morally good things morally good.
Theories that endorse the second option — let’s call any such theory a “Divine Independence Theory” (D.I.T.) — contend, on the contrary, that the goodness of an action is a feature that is independent of, and antecedent to God’s willing it. God could have commanded either this action or its opposite, but in fact, He commands only the good one.
Both D.C.T. and D.I.T. entail a perfect correspondence between the class of actions God commands and the class of actions that are good (or rather, they do so on the assumption that God is perfectly benevolent). The two theories differ, however, on what accounts for this congruence. D.C.T. says that it is God’s command that explains why the good acts are “good” — it becomes true merely by definition that God commands “good” actions. “Goodness,” on this view, becomes an empty honorific, with no independent content. To say that God chooses the good is like saying that the Prime Meridian is at zero degrees longitude, or that in baseball, three strikes makes an out. D.I.T., on the other hand, says that it is a substantive property of the acts — their goodness — that explains why God commanded them. Indeed, it says that God’s goodness consists in His choosing all and only the good. D.I.T. presumes that we have an independent grasp of moral goodness, and that it is because of that that we can properly appreciate the goodness of God.
D.C.T. is arguably even more radical and bizarre than the Hobbesian nihilism I discussed earlier. On the nihilistic view, there is no pretense that a sovereign’s power would generate moral obligation — the view is rather that “morality” is an illusion. But D.C.T. insists both that there is such a thing as moral goodness, and that it is defined by what God commands. This makes for really appalling consequences, from an intuitive, moral point of view. D.C.T. entails that anything at all could be “good” or “right” or “wrong.” If God were to command you to eat your children, then it would be “right” to eat your children. The consequences are also appalling from a religious point of view. If all “moral” means is “commanded by God,” then we cannot have what we would otherwise have thought of as moral reasons for obeying Him. We might have prudential reasons for doing so, self-interested reasons for doing so. God is extremely powerful, and so can make us suffer if we disobey Him, but the same can be said of tyrants, and we have no moral obligation (speaking now in ordinary terms) to obey tyrants. (We might even have a moral obligation to disobey tyrants.) The same goes for worshipping God. We might find it in our interest to flatter or placate such a powerful person, but there could be no way in which God was deserving of praise or tribute.
This is the sense in which I think that it is a more pious position to hold that morality is independent of the existence of God. If the term “good” is not just an empty epithet that we attach to the Creator, who or whatever that turns out to be, then it must be that the facts about what is good are independent of the other facts about God. If “good” is to have normative force, it must be something that we can understand independently of what is commanded by a powerful omnipresent being.
So what about atheism? What I think all this means is that the capacity to be moved by the moral dimension of things has nothing to do with one’s theological beliefs. The most reliable allies in any moral struggle will be those who respond to the ethically significant aspects of life, whether or not they conceive these things in religious terms. You do not lose morality by giving up God; neither do you necessarily find it by finding Him.
I want to close by conceding that there are things one loses in giving up God, and they are not insignificant. Most importantly, you lose the guarantee of redemption. Suppose that you do something morally terrible, something for which you cannot make amends, something, perhaps, for which no human being could ever be expected to forgive you. I imagine that the promise made by many religions, that God will forgive you if you are truly sorry, is a thought would that bring enormous comfort and relief. You cannot have that if you are an atheist. In consequence, you must live your life, and make your choices with the knowledge that every choice you make contributes, in one way or another, to the only value your life can have.
Some people think that if atheism were true, human choices would be insignificant. I think just the opposite — they would become surpassingly important.
Louise M. Antony teaches philosophy at the University of Massachusetts Amherst. She writes on a variety of philosophical topics, including knowledge gender, the mind and, most recently, the philosophy of religion. She is the editor of the 2007 book “Philosophers Without Gods,” a collection of essays by atheist philosophers.
Europe's gutless collapse
By Reuven Brenner
The US and European financial crises have this in common: too much credit was advanced at too low prices to households in the United States and to governments in Europe. In the US, the recipients did not have either the collateral or the prospect of revenues to pay back creditors. In Europe, the governments, with their present institutions, cannot create enough taxed wealth to pay back the debt with their current institutions, taxes and regulations.
In both cases, the recipients of the loans either lied through their teeth or deluded themselves (and delusions can be powerful when they serve one's interests). In the case of mortgage recipients in the US, few did any due diligence about their future ability to pay or about the mortgage-backed bonds.
In Europe, the move toward the European Community and the euro started with lies (or delusions of German rescues). Recall that the Italians called 1987 the year of il sorpasso, since suddenly 18% was added to their gross domestic product (GDP). The politicians claimed that this number reflected part of their undeclared, unmeasured incomes.
Why 18%? Because this was the number that allowed Italy to conform to the European Community requirement of debt/GDP ratios. The European bureaucrats were aware of much undeclared incomes in Greece too. Eventually they sued the Greek government for the false national statistics.
The result? To this day in both countries some 30% of incomes are undeclared in a variety of imaginative ways, often hidden by these countries' intricate customs, traditions and systems of patronage.
The national governments will not have an easy time changing such deeply rooted arrangements. Too many complex taxes, too many regulations, and too much corruption "on the top" resulted in ingrained perceptions that governments are wasting the money and that the courts are unreliable, rationalizing the culture of tax evasion. Why should hard-working people pay taxes when politicians and the rich get away with murder?
As it is in private life, start relationships with lies and they are unlikely to last or to end well. No trust, no finance; diminished trust, finance at a higher price. It is not rocket science.
But if all this was known, why were lenders willing to advance massive amounts of loans to these irresponsible, unaccountable entities?
Whereas in the US the case can be made that it took some time until it dawned on some that things were going awry, in Europe's case the issues surrounding Italy and Greece were well known. It was no secret that the continent was divided into "junk countries" and others where the tribe - the German one - could be called on for sacrifices and fulfilling duties, as was the case after the reunification.
Who made the mistakes that led to offering the loans to these profligate entities, aggravating mispricing of credit around the world and failing to correct the errors?
After all, the rationale for capital markets is simple: when all parties are held accountable, they correct mispricing faster than any other institutions that supply capital. There are only two other main entities that supply capital in every society: families and governments. The first is unlikely to correct mistaken allocation faster because of emotions. The second is unlikely to correct mistakes faster than arms-length financial intermediaries because a wide variety of political considerations get in the way.
So what went wrong in the presumably accountable financial institutions? Improper fiscal, regulatory and monetary policies. When combined with political considerations, however, none were considered "mistakes" by large segments of academics, central bankers, and politicians.
China illustrates in an extreme way the main difficulty with the finding solutions, but it is not dissimilar to what now confronts Europe too.
Most people agree that communism, as once practiced in the Soviet Union and China, was a colossal mistake. Tens of millions of people were killed, generations were made miserable, and talents and resources became severely mismatched. How do you correct for such mistakes? What is the path from totalitarian societies to more open ones backed by rule of law and equality?
There are no unique answers. There are no theories, no models, since the countries do not have either the legal precedents or the personnel to create, interpret and enforce them. Governments may emulate a successful country, but that too can take a generation or two.
China bet on a strategy of keeping the monopoly of the communist party, but allowing part of its population to integrate with the West. To achieve this integration, they pegged their currency to the US dollar, thus allowing dollar prices to guide the drastic restructuring. What was the alternative? Since accounting, balance sheets, prices, costs under communism were all fiction, the new government needed an anchor, and dollar prices served as such anchor.
Since wages in China were much lower than in the US, employment and exports expanded quickly. The country rapidly accumulated trillions of dollar assets. The Fed's low interest rate policy from 2004 and on distorted China's massive flow of trade to the US and its purchasing of Treasuries.
One could make the point that if the Chinese Communist Party opened up its domestic financial markets more rapidly, dispersing power and allowing entrepreneurship to thrive, the financing of the housing bubble could have been significantly mitigated, if not avoided, even with the pegged currency. Was the US able to use its negotiating powers at the time to force China to open its domestic markets more quickly? I believe so - though this option wasn't pursued.
The main point though of the above example is not to regret some foregone opportunity but to show that there are no models describing either how exactly countries should correct their political mistakes or how other countries should react while countries go through such transitions. There are no roadmaps and general theories for successful transformation: using negotiating power matters.
The European crisis
The financing of profligate, unaccountable governments, sanctioned by rating agencies and the Bank of International Settlement in Basel as being "riskless", brought us to the present situation. The solution for the eurozone required a drastic change in domestic policies cajoled by the European Union. After all, the EU knew all along about the extensive black and grey markets and the intricate patronage. Solutions were known too: simplified taxes, simplified regulations, more accountable governments.
Note that these solutions have very little to do with financial markets. They are a matter of political leadership. The political and financial institutions of China, Italy, Greece, and so forth shaped intricate institutions and habits and will not be altered because some economist or politician disapproves of it or devises some new technical models. Changing these is a matter of political leadership.
Unfortunately, such leadership is today nowhere in sight. If it does not emerge, bankruptcy, a distant second best, will bring about the changes. It is a distant second best because it could involve an extremely disorganized process, whose political outcome is unpredictable. What could then be done now while we wait for the Club Med countries to put their houses in order?
Since the European banks are at the center of the present crises, the best solution would be to emulate what happened in the US banking system in the 1990s. Namely, let them raise money by selling their loan book.
Banks would be much smaller. Ownership of non-investment grade loans would be much more dispersed. If the US banks could diminish their ownership of such loans from 80% in 1994 of their assets to 20% by 2009 (the balance distributed in a variety of collateralized loan obligations), there is no particular reason why Europe cannot achieve the same in much shorter time.
No need to implement a myriad of regulations. Disgorging debts from the zombie banks would also mitigate the much discussed "too large" or "too interconnected" to fail issue. Pension funds, insurance companies, and sovereign funds could offer the capital for such purchases.
But this takes guts, which are lacking in both Europe and the US. Yet again, I sound like Machiavelli waiting for his prince who never came.
Let's hope that he will emerge in 2012.
Reuven Brenner holds the Repap Chair at McGill University's Desautels Faculty of Management. The article draws on his books Labyrinths of Prosperity and Force of Finance.
Monday 19 December 2011
'Freedom' an instrument of oppression
This bastardised libertarianism makes 'freedom' an instrument of oppression
It's the disguise used by those who wish to exploit without restraint, denying the need for the state to protect the 99%
Illustration by Daniel Pudles
Freedom: who could object? Yet this word is now used to justify a thousand forms of exploitation. Throughout the rightwing press and blogosphere, among thinktanks and governments, the word excuses every assault on the lives of the poor, every form of inequality and intrusion to which the 1% subject us. How did libertarianism, once a noble impulse, become synonymous with injustice?
In the name of freedom – freedom from regulation – the banks were permitted to wreck the economy. In the name of freedom, taxes for the super-rich are cut. In the name of freedom, companies lobby to drop the minimum wage and raise working hours. In the same cause, US insurers lobby Congress to thwart effective public healthcare; the government rips up our planning laws; big business trashes the biosphere. This is the freedom of the powerful to exploit the weak, the rich to exploit the poor.
Rightwing libertarianism recognises few legitimate constraints on the power to act, regardless of the impact on the lives of others. In the UK it is forcefully promoted by groups like the TaxPayers' Alliance, the Adam Smith Institute, the Institute of Economic Affairs, and Policy Exchange. Their concept of freedom looks to me like nothing but a justification for greed.
So why have we been been so slow to challenge this concept of liberty? I believe that one of the reasons is as follows. The great political conflict of our age – between neocons and the millionaires and corporations they support on one side, and social justice campaigners and environmentalists on the other – has been mischaracterised as a clash between negative and positive freedoms. These freedoms were most clearly defined by Isaiah Berlin in his essay of 1958, Two Concepts of Liberty. It is a work of beauty: reading it is like listening to a gloriously crafted piece of music. I will try not to mangle it too badly.
Put briefly and crudely, negative freedom is the freedom to be or to act without interference from other people. Positive freedom is freedom from inhibition: it's the power gained by transcending social or psychological constraints. Berlin explained how positive freedom had been abused by tyrannies, particularly by the Soviet Union. It portrayed its brutal governance as the empowerment of the people, who could achieve a higher freedom by subordinating themselves to a collective single will.
Rightwing libertarians claim that greens and social justice campaigners are closet communists trying to resurrect Soviet conceptions of positive freedom. In reality, the battle mostly consists of a clash between negative freedoms.
As Berlin noted: "No man's activity is so completely private as never to obstruct the lives of others in any way. 'Freedom for the pike is death for the minnows'." So, he argued, some people's freedom must sometimes be curtailed "to secure the freedom of others". In other words, your freedom to swing your fist ends where my nose begins. The negative freedom not to have our noses punched is the freedom that green and social justice campaigns, exemplified by the Occupy movement, exist to defend.
Berlin also shows that freedom can intrude on other values, such as justice, equality or human happiness. "If the liberty of myself or my class or nation depends on the misery of a number of other human beings, the system which promotes this is unjust and immoral." It follows that the state should impose legal restraints on freedoms that interfere with other people's freedoms – or on freedoms which conflict with justice and humanity.
These conflicts of negative freedom were summarised in one of the greatest poems of the 19th century, which could be seen as the founding document of British environmentalism. In The Fallen Elm, John Clare describes the felling of the tree he loved, presumably by his landlord, that grew beside his home. "Self-interest saw thee stand in freedom's ways / So thy old shadow must a tyrant be. / Thou'st heard the knave, abusing those in power, / Bawl freedom loud and then oppress the free."
The landlord was exercising his freedom to cut the tree down. In doing so, he was intruding on Clare's freedom to delight in the tree, whose existence enhanced his life. The landlord justifies this destruction by characterising the tree as an impediment to freedom – his freedom, which he conflates with the general liberty of humankind. Without the involvement of the state (which today might take the form of a tree preservation order) the powerful man could trample the pleasures of the powerless man. Clare then compares the felling of the tree with further intrusions on his liberty. "Such was thy ruin, music-making elm; / The right of freedom was to injure thine: / As thou wert served, so would they overwhelm / In freedom's name the little that is mine."
But rightwing libertarians do not recognise this conflict. They speak, like Clare's landlord, as if the same freedom affects everybody in the same way. They assert their freedom to pollute, exploit, even – among the gun nuts – to kill, as if these were fundamental human rights. They characterise any attempt to restrain them as tyranny. They refuse to see that there is a clash between the freedom of the pike and the freedom of the minnow.
Last week, on an internet radio channel called The Fifth Column, I debated climate change with Claire Fox of the Institute of Ideas, one of the rightwing libertarian groups that rose from the ashes of the Revolutionary Communist party. Fox is a feared interrogator on the BBC show The Moral Maze. Yet when I asked her a simple question – "do you accept that some people's freedoms intrude upon other people's freedoms?" – I saw an ideology shatter like a windscreen. I used the example of a Romanian lead-smelting plant I had visited in 2000, whose freedom to pollute is shortening the lives of its neighbours. Surely the plant should be regulated in order to enhance the negative freedoms – freedom from pollution, freedom from poisoning – of its neighbours? She tried several times to answer it, but nothing coherent emerged which would not send her crashing through the mirror of her philosophy.
Modern libertarianism is the disguise adopted by those who wish to exploit without restraint. It pretends that only the state intrudes on our liberties. It ignores the role of banks, corporations and the rich in making us less free. It denies the need for the state to curb them in order to protect the freedoms of weaker people. This bastardised, one-eyed philosophy is a con trick, whose promoters attempt to wrongfoot justice by pitching it against liberty. By this means they have turned "freedom" into an instrument of oppression.
Sunday 18 December 2011
No Walmart, Please
By Justice Rajindar Sachar (retd)
17 December, 2011
The Tribune, India
The Tribune, India
Govt’s claim is questionable
If the combined
Opposition had sat down for weeks to find an issue to embarrass the UPA
government and make it a laughing stock before the whole country, they
could not have thought of a better issue than the free gift presented to
it initially by the government by insisting that it had decided
irrevocably to allow the entry of multi-brand retail super stores like
Walmart and then within a few days, with a whimper, withdrawing the
proposal.
As it is, even initially this decision defied logic
in view of the Punjab and UP elections and known strong views against it
of the BJP and the Left. Many states had all the time opposed the entry
of Walmart which would affect the lives of millions in the country.
Retail business in India is estimated to be of the
order of $ 400 billion, but the share of the corporate sector is only 5
per cent. There are 50 million retailers in India, including hawkers and
pavement sellers. This comes to one retailer serving eight Indians. In
China, it is one for 100 Chinese. Food is 63 per cent of the retail
trade, according to information given by FICCI.
The claim by the government that Walmart intrusion
will not result in the closure of small retailers is a deliberate
mis-statement. A study done by IOWA State University, US, has shown that
in the first decade after Walmart arrived in IOWA the state lost 555
grocery stores, 298 hardware stores, 293 building supply stores, 161
variety stores, 158 women apparels stores and 153 shoe stores, 116 drug
stores and 111 men and boys apparels stores. Why would it be different
in India with a lesser capacity for resilience by small traders.
The fact is that during 15 years of Walmart entering
the market, 31 super market chains sought bankruptcy. Of the 1.6
million employees of Walmart, only 1.2 per cent make a living above the
poverty level. The Bureau of Labour Statistics, US, is on record with
its conclusion that Walmart’s prices are not lower.
In Thailand, supermarkets led to a 14 per cent
reduction in the share of ‘mom and pop’ stores within four years of FDI
permission. In India, 33-60 per cent of the traditional fruit and
vegetable retailers reported a 15-30 per cent decline in footfalls, a
10-30 per cent fall in sales and a 20-30 per cent decline in incomes
across Bangalore, Ahmedabad and Chandigarh, the largest impact being in
Bangalore, which is one of the most supermarket-penetrated cities in
India.
The average size of the Walmart stores in the US is
about 10,800 sq feet employing only 225 people. In that view, is not the
government’s claim of an increase in employment unbelievable? The
government’s attempt is to soften the blow by emphasising that Walmart
is being allowed only 51 per cent in investment up to $100 million.
Prima facie, the argument may seem attractive. But is the Walmart
management so stupid that when its present turnover of retail is $ 400
billion it would settle for such a small gain? No, obviously, Walmart is
proceeding on the maxim of the camel being allowed to put its head
inside a tent and the occupant finding thereafter that he is being
driven out of it by the camel occupying the whole of the tent space. One
may substitute Walmart for the camel to understand the danger to our
millions of retailers.
The tongue-in-cheek argument by the government that
allowing Walmart to set up its business in India would lead to a fall in
prices and an increase in employment is unproven. A 2004 report of a
committee of the US House of Representatives concluded that “Walmart’s
success has meant downward pressures on wages and benefits, rampant
violations of basic workers’ rights and threats to the standard of
living in communities across the country.” By what logic does the
government say that in India the effect will be the opposite? The only
explanation could be that it is a deliberate mis-statement to help
multinationals.
Similar anti-consumer effects have happened by the working of another supermarket enterprise, Tesco of Britain.
A study carried out by Sunday Times shows that Tesco
has almost total control of the food market of 108 of Britain’s coastal
areas — 7.4 per cent of the country. The super stores like Walmart and
Tesco have a compulsion to move out of England and the US because their
markets are saturated. These companies are looking for countries with a
larger population and low supermarket presence, according to David
Hogues, Professor of Agri-Business at the Centre for Food Chain Research
at Imperial College, London. They have got nowhere else to go and their
home markets are already full. Similarly, a professor of Michigan State
University has pointed out that retail revolution causes serious risks
for developing country farmers who traditionally supply to the local
street market.
In Thailand, Tesco controls more than half the Thai
market. Though Tesco, when it moved into Thailand, promised to employ
local people but it is openly being accused of indulging in unfair
trading practices. The claim that these supermarket dealers will buy
local products is belied because in a case filed against Tesco in July
2002 the court found it charging slotting fees to carry manufacturers’
products, charging entry fee of suppliers. In Bangkok, grocery stores’
sales declined by more than half since Tesco opened a store only four
years ago.
In Malaysia, seeing the damage done by Tesco since
January 2004, a freeze on the building of any new supermarket was
imposed in three major cities and this when Tesco had only gone to
Malaysia in 2002.
It is worth noting that 92 per cent of everything
Walmart sells comes from Chinese-owned companies. The Indian market is
already flooded with Chinese goods which are capturing the market with
cheap offers, and traders are already crying foul because of the
deplorable labour practices adopted by China. Can, in all fairness, the
Indian government still persist in keeping the retail market open to
foreign enterprises and thus endangering the earnings and occupations of
millions of our countrymen and women?
The writer is a former Chief Justice of the High Court of Delhi
Saturday 17 December 2011
Why pretend we know everything? It's time to embrace uncertainty
It is certainty that we need to worry about, as extreme ideologies prosper in these uncertain times
Who knows if David Cameron's refusal to sign the EU treaty is a good thing or not. Photograph: Yves Herman/Reuters
I don't know what I am talking about. And, quite frankly, you should be relieved that I know that I don't know. The world is full of people proclaiming about stuff they don't know much about. My trade depends on it. Pundits, politicians and economists, too, all depend on some kind of bladder-busting meta-analysis to keep us quiet. In fact, they are just winging it.
Too many nights I have watched economists on television being treated with undeserved reverence. "Economics is largely a made-up pseudo-science!" I want to scream. After all, it has been almost entirely useless in predicting the mess we are in. Indeed, by coming up with grotesque calculations whereby rich people's investments were effectively risk-free and financed by the jobs and homes of the poor, many economists were cheerleaders pre-crisis.
This is not another anti-bank rant. It is now self-evident that banks did some bad stuff, but the diplomatic immunity they were granted was not merely political. Anyone who makes out that they know what they are doing and can turn a fast buck and believes, yes really believes, in something – anything, themselves even – is facilitated by society. And, yes, this is usually backed up by a narrative of questionable facts.
What is valued is certainty. What is devalued in such a world is uncertainty. Those who aren't sure are weak. Poor. Faithless. Uncertainty is often worrying and feminised. Real men know real things. So they have been lining up to tell us that David Cameron's refusal to sign the EU treaty is the best thing ever to have happened, or the worst thing ever to have happened, when, actually, no one is quite sure. Reconciling a belief in the democratic process with the recognition that the euro is still in big trouble and Greece may well go anyway, means it is impossible to line up clearly in the Eurosceptic versus Europhile shadow boxing. It is up in the air.
As this year has been a news tsunami, it would be far more interesting to acknowledge what we did not know rather than what we did. Most experts did not predict the riots, the Arab spring, the extent of the economic meltdown. I recall meeting a learned professor in Tel Aviv three years ago who explained that Iran not Egypt was now the centre of the Arab world and everything would start there. Like many others, I thought recession would produce some kind of resistance but had no idea how that would manifest itself. As for the financial crisis, our lack of foresight is mind-boggling.
But in public, and especially in politics, an admission of uncertainty is seen as problematic. At a dinner I attended a few years ago, a young politician was asked a question to which he had no answer. He said: "I don't know about that; I will go away and find out." It was Ed Miliband as it happens, and I was impressed. But the guys I was with crowed: "We got him there!" This relentless reduction of politics to point-scoring, this public-school obsession with certainty, is a turn-off. Look where it leads. Not so long ago, George W Bush said that if America "shows uncertainty and weakness in this decade, the world will drift towards tragedy. This will not happen on my watch." Apart from war, this "certainty" helped to produce the debt crisis.
It is certainty that we need to worry about, as extreme ideologies prosper in these uncertain times. Yet there have always been ways of thinking that properly refute certainty. The school of "weak thought" coming out of Italy via Gianni Vattimo follows a clear line from Nietzsche onwards that pushes against finality, and urges us to understand historical circumstance. "There are no facts, only interpretations and this too is an interpretation," Vattimo has said.
The work of Nassim Taleb also confronts us with the idea that the economic models used by the banks were based on the idea of stability. The ecology of the banking system could not predict risk properly at all (although Taleb did, actually). Then we have a genius such as Zygmunt Bauman, who has long been telling us that we live in "liquid modernity", that individuals can no longer plan careers and progress in linear, certain ways. Yes, it is like the weather: changeable.
Of course those who most understand the value of uncertainty are scientists themselves. As the delightful Jon Butterworth wrote this week, science has nothing to fear from uncertainty. The sexy little Higgs Boson particle, which may have flashed up in the data in Cern (I imagine it as a burlesque sort of particle) has meant we have listened to physicists telling us very excitedly about how much we just don't know.
This has been wonderful. The opposite of political discourse: to hear clever people talking about the limits of their own knowledge. How weighed down is public life with its emphasis on certainty. How dumbed down is belief. The big divides are not between different beliefs, but the differing degree of certitude in which those beliefs are held.
No one knows. No one has the answers. Uncertainty is where we are. It is to be embraced. Christopher Hitchens, when asked which word he had most overused, said he was shocked to find on rereading his work that it was "perhaps".
I love that. Perhaps, right now, is the best word. I'm sure of that. Perhaps.
Politicians are Dire!
Western politicians are dire, but we mustn't despise government
Our leaderships, in thrall to big business, are failing in so many places all at the same time. But we can't give up on them
David Cameron was quite right to reject
an economic treaty wasn't even written yet, much less scrutinised.
Photograph: Yves Herman/Reuters
The year 2011 will be remembered as the year of failed summits. Governments proved themselves time and again to be failures at addressing the growing crises engulfing the world, whether the eurozone debacle, climate change, or budget politics in the US and Europe. Next year is likely to be worse, as electoral politics will further impede decision-making in the US, France and several other countries.
Why should governance be so poor in so many places at the same time? There are several factors at play. Globalisation has undermined the manufacturing base of most of the high-income economies, costing millions of jobs and leading to stagnant or falling living standards for a large part of the workforce, especially those with basic skills and modest education attainment. The US has lost around 8-9 million manufacturing jobs since the peak in that sector in 1979, just as China was joining the world economy. Meanwhile, the soaring economies of Asia have pushed up world food and oil prices, further squeezing real incomes in Europe and the US.
Yet in the face of high unemployment, growing inequality and looming budget deficits, most governments are paralysed, in thrall to powerful interests. Wall Street, the City of London, the Frankfurt banks and other corporate lobbies hold politics in their grip, and block effective change. Top income tax rates are kept low; banks remain undercapitalised and under-regulated; and urgently needed public investments for education, job skills and upgraded infrastructure are being slashed in response to budgetary pressures.
The politicians are also in way over their heads. They are typically negotiators and public relations specialists, not experts on the policies needed to resolve the world economy's crises. The special interest groups write the scripts, but these scripts prove impossible to stage. Every European summit in the past two years has not only failed politically, but also technically. The policy prescriptions put forward by Germany's Chancellor Merkel are poorly prepared and designed, and impossible to implement. The euro is being killed not only by politics but also by incompetence.
The actual process of governing has descended to soundbites. In the US the Obama administration has failed to produce a major policy document on any area of key policy concern: the budget, taxation, energy, climate, financial regulation, healthcare or poverty. Policies and legislation are decided in the backrooms dominated by lobbyists and negotiators. Politics is by horse-trading among interest groups – not by reason, expertise and democratic deliberation.
The European Union processes are now equally bizarre. The entire union of 27 countries awaits the word of one member, Germany, whose policy logic in turn reflects a mix of post-traumatic stress, coalition politics, powerful yet crippled banks, and amateur politicians. The European commission seems to play little or no role. Major new treaties of constitutional importance are launched by Germany days before a summit, with no reasoned discussion or professional analysis. David Cameron was absolutely right not to be cowed into signing up to an economic treaty that isn't even written yet, much less professionally scrutinised.
A few countries, notably the northern European social democracies, are keeping their heads above water, at least for now. They are stable because income inequality and poverty are kept low by active government policies. Transfer payments to the poor and the social safety net are robust. Tax collections are ample and budgets are in balance or surplus. Even these countries flirted with financial deregulation in the 1990s, paid a heavy price and then got their banking sectors back under control. Tough financial regulation has served them well during the past decade.
So what can we learn from the few success stories? First, societies function properly only when they are judged by their citizens to be reasonably fair. Northern Europe has built its policies on a framework of equality and inclusion. In the US, the idea of fairness has been almost absent from political vocabulary for three decades. The Occupy Wall Street movement, thankfully, has brought it back to life. Most of Europe is somewhere between the fairness of northern Europe's social democracies and the glaring inequities of the US. Yet in much of western Europe there has been a clear shift away from solidarity, towards harsher policies that shield the rich from their responsibilities to the rest of society.
Second, economic success requires increased public investments in education, infrastructure, energy, job skills and more. Simplistic budget cutting will destroy governments rather than fix them. Higher taxes on top incomes and wealth must be part of any sound fiscal strategy. Yet till today, Washington politicians of both parties have been recklessly and thoughtlessly squandering American prosperity by prioritising tax breaks for the rich.
Third, more expert policymaking is needed. The eurozone crisis, for example, requires urgent attention to Europe's decapitalised banks. Yet German politicians, driven by ideology and local politics, have been fixated on fiscal problems while allowing the banking crisis to fester and worsen. The US crisis is fundamentally about the under-taxation of the rich, yet the policy focus remains on budget cutting. In both Europe and the US, political debates consistently miss the mark by short-changing serious diagnostics and policy design.
Our temptation in the face of rampant government failures is to despise government, and even to cheer its demise. How can we avoid that feeling when we watch politicians preening on the TV screen? Yet we desperately need to make the US and European governments work again – not for the politicians' sake, but for ours. Unless we restore skill, fairness, and vibrancy to our democratic institutions, the unrest on the streets is bound to grow.
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