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Wednesday 8 November 2017

Ambedkar on Islam: Ramachandra Guha, Arundhati Roy you have ignored these views.



Anand Ranganathan in News Laundry




From the Aryans to Aurangzeb, from St Xavier to Shivaji, our historians have chosen what to hide, what to invent, and what to disclose. The singular reason for this is the craving for patronage – of an ideology, a government, an ecosystem, or a clique. And once our historians are done with their contortions, we the readers sit back and enjoy the inevitable fallout – the outing of Hypocrisy.

The Left outs the hypocrisy of the Right and the Right outs the hypocrisy of the Left and great column-yards are churned out as a result of such skirmishes. But we forget – outing of hypocrisy is a virtue so long as it doesn’t turn one into a hypocrite. Well, it does; every single time. Villains are made into heroes and heroes into villains. We like it this way. Gandhi, Nehru, Savarkar, Patel – they are to be worshipped; they are to be made into Gods, into Atlases who carry the weight of our ideologies and our biases on the nape of their necks.

History as myth; myth as History. It conforms to what we really are – unsure of our present, fearful of our future. The Right wing doesn’t want to hear anything about Savarkar or Golwalkar that might put them in bad light; the Left-wing doesn’t want to hear anything about Nehru or Namboodiripad that might put them in bad light; and the Velcro Historians don’t want to write anything about anyone that might put them in solitary confinement, away from all light.

Fear and trembling, that is what this is, and the whole nation chugs along on this dead yet simmering coal. A journey to nowhere; slow, halting, tiring; until you realise what the grand plan always is – to appropriate. And of all the great men and women we have had the honour to call our own, no one has been more appropriated than Bhimrao Ramji Ambedkar.

Ambedkar. A hero for all, the Left and the Right – out of genuine admiration, out of genuine fear. This is to be expected, for here was a man like no other in modern world history, one who shone like a star with his intellect and understanding. The most un-Indian Indian. Wisdom so frightening and yet so rooted, that it appealed to all. Where he was allowed to, he never put a foot wrong. His writings have that rare quality of timelessness, and his quotes, if quoted anonymously, can be mistaken as comments on contemporary India. Ambedkar has aged well. In this, he stands alone, afar, above. But there is a side to Ambedkar that is not known, spoken, or written, out of fear by those who have appropriated him.

Ambedkar's criticism of Hinduism, as a religion, as a way of life – call it what you will, everyone is aware of. From his umpteen speeches and numerous scholarly works, we know Ambedkar as someone who fought and exposed the terrible ills of Hinduism, and we applaud him for it. That Ambedkar left Hinduism and converted to Buddhism is in itself a stinging appraisal of the former. Knowing him, nothing more needs to be said as a critique of Hinduism. Such is the trust one can put in the man.

What we don’t know, however, is what he thought of the other great religion of the world – Islam. Because this facet of Ambedkar has been hidden from our general discourse and textbooks, it may come as a surprise to most that Ambedkar thought frequently of Islam and spoke frequently on it. The cold and cruel India of the young Ambedkar, that shaped his views on Hinduism and Hindus – and of which this author has writtenpreviously – soon became the cold and cruel India of the old Ambedkar, allowing him, through a study of Islam and Muslims, to make sense of a nation hurtling towards a painful and bloody partition.

A distillate of Ambedkar's thoughts on Islam and Muslims can be found in Pakistan Or The Partition Of India, a collection of his writings and speeches, first published in 1940, with subsequent editions in 1945 and 1946. It is an astonishing book in its scope and acuity, and reading it one realises why no one talks of it, possessing as it does the potential to turn Ambedkar into an Islamophobic bigot for his worshippers on the Left.

Here, then, is Ambedkar on Islam:

"Hinduism is said to divide people and in contrast Islam is said to bind people together. This is only a half-truth. For Islam divides as inexorably as it binds. Islam is a close corporation and the distinction that it makes between Muslims and non-Muslims is a very real, very positive and very alienating distinction. The brotherhood of Islam is not the universal brotherhood of man. It is brotherhood of Muslims for Muslims only. There is a fraternity, but its benefit is confined to those within that corporation. For those who are outside the corporation, there is nothing but contempt and enmity. The second defect of Islam is that it is a system of social self-government and is incompatible with local self-government, because the allegiance of a Muslim does not rest on his domicile in the country which is his but on the faith to which he belongs. To the Muslim ibi bene ibi patria [Where it is well with me, there is my country] is unthinkable. Wherever there is the rule of Islam, there is his own country. In other words, Islam can never allow a true Muslim to adopt India as his motherland and regard a Hindu as his kith and kin."

This scathing indictment by Ambedkar of Islam never finds a mention in our history books. (Indeed, even in Ambedkar.org, a primary resource site for Ambedkar, the chapter that contains this explosive passage is hyperlinked and, unlike other preceding chapters, not easily visible as a continuation under the sub-heading Part IV. The idea is to skip it, not click it.

But then this is India – a Hero must not be perceived as a Villain even though the misperception is entirely of our making. Well, we know better; he didn’t mean to say those things about Islam; perhaps he was misguided; let us look at the context; damn, no, that's not of any help here; tell you what, let us gag him; for the greater good; for communal harmony; for the sake of IPC Section 295A and our peaceful future.

Selective reading of Ambedkar, by which it is meant reading only his damning (and entirely justified) criticism of Hinduism, has led to a prevalent view that only Hinduism is laden with cultural and religious ills. One can see this even today, when the Left and its ideologues point selectively to the social and religious evils pertaining to Hinduism. As a result, someone who isn’t well-versed with India may get the impression that it is only Hinduism and Hindus who are to blame for every ill and intolerance that plagues us. The reality, of course, is that social and religious intolerance runs in our veins, it always has and it always will, for none other than the holy scriptures of all religions have mainstreamed it. It is Ambedkar himself who, presciently and fiercely, points to this hypocrisy.

"The social evils which characterize the Hindu Society, have been well known. The publication of 'Mother India' by Miss Mayo gave these evils the widest publicity. But while 'Mother India' served the purpose of exposing the evils and calling their authors at the bar of the world to answer for their sins, it created the unfortunate impression throughout the world that while the Hindus were grovelling in the mud of these social evils and were conservative, the Muslims in India were free from them, and as compared to the Hindus, were a progressive people. That, such an impression should prevail, is surprising to those who know the Muslim Society in India at close quarters."

Ambedkar then proceeds to talk in scathing terms of child-marriage, intolerance, fanatical adherence to faith, the position of women, polygamy, and other such practices prevalent among believers of Islam. On the subject of caste, Ambedkar goes into great detail, and no punches are pulled.

"Take the caste system. Islam speaks of brotherhood. Everybody infers that Islam must be free from slavery and caste. Regarding slavery nothing needs to be said. It stands abolished now by law. But while it existed much of its support was derived from Islam and Islamic countries. But if slavery has gone, caste among Musalmans has remained. There can thus be no manner of doubt that the Muslim Society in India is afflicted by the same social evils as afflict the Hindu Society. Indeed, the Muslims have all the social evils of the Hindus and something more. That something more is the compulsory system of purdah for Muslim women."

Those who rightly commend Ambedkar for leaving the fold of Hinduism, never ask why he converted to Buddhism and not Islam. It is because he viewed Islam as no better than Hinduism. And keeping the political and cultural aspects in mind, he had this to say:

"Conversion to Islam or Christianity will denationalise the Depressed Classes. If they go to Islam the number of Muslims will be doubled and the danger of Muslim domination also becomes real."

On Muslim politics, Ambedkar is caustic, even scornful.

"There is thus a stagnation not only in the social life but also in the political life of the Muslim community of India. The Muslims have no interest in politics as such. Their predominant interest is religion. This can be easily seen by the terms and conditions that a Muslim constituency makes for its support to a candidate fighting for a seat. The Muslim constituency does not care to examine the programme of the candidate. All that the constituency wants from the candidate is that he should agree to replace the old lamps of the masjid by supplying new ones at his cost, to provide a new carpet for the masjid because the old one is torn, or to repair the masjid because it has become dilapidated. In some places a Muslim constituency is quite satisfied if the candidate agrees to give a sumptuous feast and in other if he agrees to buy votes for so much a piece. With the Muslims, election is a mere matter of money and is very seldom a matter of social programme of general improvement. Muslim politics takes no note of purely secular categories of life, namely, the differences between rich and poor, capital and labour, landlord and tenant, priest and layman, reason and superstition. Muslim politics is essentially clerical and recognizes only one difference, namely, that existing between Hindus and Muslims. None of the secular categories of life have any place in the politics of the Muslim community and if they do find a place—and they must because they are irrepressible—they are subordinated to one and the only governing principle of the Muslim political universe, namely, religion."

The psychoanalysis of the Indian Muslim by Ambedkar is unquestionably deeply hurtful to those on the Left who have appropriated him. How they wish he had never written such things. They try their best to dismiss his writings on Islam and Muslims by taking refuge in the time-tested excuse of "context". That's right. Whenever text troubles you, rake up its context.

Except that in the case of Ambedkar, this excuse falls flat. Ambedkar's views on Islam – in a book with fourteen chapters that deal almost entirely with Muslims, the Muslim psyche, and the Muslim Condition – are stand-alone statements robustly supported with quotes and teachings of scholars, Muslim leaders, and academics. To him these are maxims. He isn’t writing fiction. The context is superfluous; in fact, it is non-existent. Read the following statements:

The brotherhood of Islam is not the universal brotherhood of man. It is brotherhood of Muslims for Muslims only.

There is a fraternity, but its benefit is confined to those within that corporation. For those who are outside the corporation, there is nothing but contempt and enmity.

The second defect of Islam is that it is a system of social self-government and is incompatible with local self-government, because the allegiance of a Muslim does not rest on his domicile in the country which is his but on the faith to which he belongs.

Wherever there is the rule of Islam, there is his own country. In other words, Islam can never allow a true Muslim to adopt India as his motherland and regard a Hindu as his kith and kin.

If you are hunting for a context to the above statements, you have just outed yourself as a hopeless apologist. Well, you are not alone. Some of India’s most celebrated hagiographers, commentators, writers, and columnists, that include Ramachandra Guha and Arundhati Roy – both of whom have written copiously on Ambedkar, through stand-alone chapters or books (The Doctor and the Saint; India after Gandhi; Democrats and Dissenters; Makers of Modern India) – are conspicuously silent on Ambedkar’s views on Islam and the Muslim psyche. Clearly, this is a story the apologists do not want to tell.

The one thing Ambedkar was not, was an apologist. He spares no one, not even Mahatma Gandhi, who he blasts for giving into the selective bias, of the type one finds ubiquitous today.

"He [Gandhi] has never called the Muslims to account even when they have been guilty of gross crimes against Hindus."

Ambedkar then goes on to list a few Hindu leaders who were killed by Muslims, one among them being Rajpal, the publisher of Rangeela Rasool, the ‘Satanic Verses’ equivalent of pre-Independence India. We all know what happened to Rushdie. As for Rajpal, he met a fate worse than the celebrated Indian author. Rajpal was brutally stabbed in broad daylight. Again, not many know the assassination of Rajpal by Ilm-ud-din was celebrated by all prominent Muslims leaders of the day.

Ilm-ud-din was defended in the court by none other than Jinnah, and the man who rendered a eulogy at his funeral (that was attended by tens of thousands of mourners) was none other than the famous poet Allama Iqbal, who cried as the assassin's coffin was lowered: "We sat idle while this carpenter's son took the lead." Iqbal is revered in India; Mamata Banerjee, the Chief Minister of West Bengal, recently conferred on him the title of Tarana-E-Hind. “Nation will never forget Iqbal,” she said.

Ambedkar writes: "Mr. Gandhi has been very punctilious in the matter of condemning any and every act of violence and has forced the Congress, much against its will to condemn it. But Mr Gandhi has never protested against such murders [of Hindus]. Not only have the Musalmans not condemned these outrages, but even Mr Gandhi has never called upon the leading Muslims to condemn them. He has kept silent over them. Such an attitude can be explained only on the ground that Mr Gandhi was anxious to preserve Hindu-Moslem unity and did not mind the murders of a few Hindus, if it could be achieved by sacrificing their lives...This attitude to excuse the Muslims any wrong, lest it should injure the cause of unity, is well illustrated by what Mr Gandhi had to say in the matter of the Mopla riots. The blood-curdling atrocities committed by the Moplas in Malabar against the Hindus were indescribable. All over Southern India, a wave of horrified feeling had spread among the Hindus of every shade of opinion, which was intensified when certain Khilafat leaders were so misguided as to pass resolutions of "congratulations to the Moplas on the brave fight they were conducting for the sake of religion". Any person could have said that this was too heavy a price for Hindu-Moslem unity. But Mr Gandhi was so much obsessed by the necessity of establishing Hindu-Moslem unity that he was prepared to make light of the doings of the Moplas and the Khilafats who were congratulating them. He spoke of the Moplas as the "brave God-fearing Moplas who were fighting for what they consider as religion and in a manner which they consider as religious ".

As usual, Mr Gandhi failed to produce any satisfactory response to Ambedkar's serious charge. Mahatmas never do. The conduct of Gandhi during the Mopla riots, and his views on them once the carnage had subsided, remain a blot on the Mahatma. Again, they never form part of our history books.

On the allegiance of a Muslim to his motherland [India], Ambedkar writes:

"Among the tenets one that calls for notice is the tenet of Islam which says that in a country which is not under Muslim rule, wherever there is a conflict between Muslim law and the law of the land, the former must prevail over the latter, and a Muslim will be justified in obeying the Muslim law and defying the law of the land."

Quoting the following: "The only allegiance a Musalman, whether civilian or soldier, whether living under a Muslim or under a non-Muslim administration, is commanded by the Koran to acknowledge is his allegiance to God, to his Prophet and to those in authority from among the Musalmans…" Ambedkar adds: "This must make anyone wishing for a stable government very apprehensive. But this is nothing to the Muslim tenets which prescribe when a country is a motherland to the Muslim and when it is not…According to Muslim Canon Law the world is divided into two camps, Dar-ul-lslam (abode of Islam), and Dar-ul-Harb (abode of war). A country is Dar-ul-lslam when it is ruled by Muslims. A country is Dar-ul-Harb when Muslims only reside in it but are not rulers of it. That being the Canon Law of the Muslims, India cannot be the common motherland of the Hindus and the Musalmans. It can be the land of the Musalmans—but it cannot be the land of the 'Hindus and the Musalmans living as equals.' Further, it can be the land of the Musalmans only when it is governed by the Muslims. The moment the land becomes subject to the authority of a non-Muslim power, it ceases to be the land of the Muslims. Instead of being Dar-ul-lslam it becomes Dar-ul-Harb.

"It must not be supposed that this view is only of academic interest. For it is capable of becoming an active force capable of influencing the conduct of the Muslims…It might also be mentioned that Hijrat [emigration] is not the only way of escape to Muslims who find themselves in a Dar-ul-Harb. There is another injunction of Muslim Canon Law called Jihad (crusade) by which it becomes "incumbent on a Muslim ruler to extend the rule of Islam until the whole world shall have been brought under its sway. The world, being divided into two camps, Dar-ul-lslam (abode of Islam), Dar-ul-Harb (abode of war), all countries come under one category or the other. Technically, it is the duty of the Muslim ruler, who is capable of doing so, to transform Dar-ul-Harb into Dar-ul-lslam." And just as there are instances of the Muslims in India resorting to Hijrat, there are instances showing that they have not hesitated to proclaim Jihad.”


On a Muslim respecting authority of an elected government, Ambedkar writes:

"Willingness to render obedience to the authority of the government is as essential for the stability of government as the unity of political parties on the fundamentals of the state. It is impossible for any sane person to question the importance of obedience in the maintenance of the state. To believe in civil disobedience is to believe in anarchy…How far will Muslims obey the authority of a government manned and controlled by the Hindus? The answer to this question need not call for much inquiry."

This view isn't much different from the views of Jinnah and the Muslim League. Indeed, in the then prevailing climate, engineered or otherwise, these views could be seen as legitimate from the point of view of an anxious minority. However, the reason that Ambedkar gives for this predilection is not at all political but, rather startlingly, religious. He writes:

"To the Muslims a Hindu is a Kaffir. A Kaffir is not worthy of respect. He is low-born and without status. That is why a country which is ruled by a Kaffir is Dar-ul-Harb to a Musalman. Given this, no further evidence seems to be necessary to prove that the Muslims will not obey a Hindu government. The basic feelings of deference and sympathy, which predispose persons to obey the authority of government, do not simply exist. But if proof is wanted, there is no dearth of it. It is so abundant that the problem is what to tender and what to omit…In the midst of the Khilafat agitation, when the Hindus were doing so much to help the Musalmans, the Muslims did not forget that as compared with them the Hindus were a low and an inferior race.”

Ambedkar isn’t done yet. On the lack of reforms in the Muslim community, he writes:

"What can that special reason be? It seems to me that the reason for the absence of the spirit of change in the Indian Musalman is to be sought in the peculiar position he occupies in India. He is placed in a social environment which is predominantly Hindu. That Hindu environment is always silently but surely encroaching upon him. He feels that it is de-musalmanazing him. As a protection against this gradual weaning away he is led to insist on preserving everything that is Islamic without caring to examine whether it is helpful or harmful to his society. Secondly, the Muslims in India are placed in a political environment which is also predominantly Hindu. He feels that he will be suppressed and that political suppression will make the Muslims a depressed class. It is this consciousness that he has to save himself from being submerged by the Hindus socially and-politically, which to my mind is the primary cause why the Indian Muslims as compared with their fellows outside are backward in the matter of social reform.

"Their energies are directed to maintaining a constant struggle against the Hindus for seats and posts in which there is no time, no thought and no room for questions relating to social reform. And if there is any, it is all overweighed and suppressed by the desire, generated by pressure of communal tension, to close the ranks and offer a united front to the menace of the Hindus and Hinduism by maintaining their socio-religious unity at any cost. The same is the explanation of the political stagnation in the Muslim community of India.

"Muslim politicians do not recognize secular categories of life as the basis of their politics because to them it means the weakening of the community in its fight against the Hindus. The poor Muslims will not join the poor Hindus to get justice from the rich. Muslim tenants will not join Hindu tenants to prevent the tyranny of the landlord. Muslim labourers will not join Hindu labourers in the fight of labour against capital. Why? The answer is simple. The poor Muslim sees that if he joins in the fight of the poor against the rich, he may be fighting against a rich Muslim. The Muslim tenant feels that if he joins in the campaign against the landlord, he may have to fight against a Muslim landlord. A Muslim labourer feels that if he joins in the onslaught of labour against capital, he will be injuring a Muslim mill-owner. He is conscious that any injury to a rich Muslim, to a Muslim landlord or to a Muslim mill-owner, is a disservice to the Muslim community, for it is thereby weakened in its struggle against the Hindu community."


Then, Ambedkar writes something that would surely confirm him as a certified Islamophobe and a bigot in the jaundiced eyes of those who have appropriated him.

"How Muslim politics has become perverted is shown by the attitude of the Muslim leaders to the political reforms in the Indian States. The Muslims and their leaders carried on a great agitation for the introduction of representative government in the Hindu State of Kashmir. The same Muslims and their leaders are deadly opposed to the introduction of representative governments in other Muslim States. The reason for this strange attitude is quite simple. In all matters, the determining question with the Muslims is how it will affect the Muslims vis-a-vis the Hindus. If representative government can help the Muslims, they will demand it, and fight for it. In the State of Kashmir the ruler is a Hindu, but the majority of the subjects are Muslims. The Muslims fought for representative government in Kashmir, because representative government in Kashmir meant the transfer of power from a Hindu king to the Muslim masses. In other Muslim States, the ruler is a Muslim but the majority of his subjects are Hindus. In such States representative government means the transfer of power from a Muslim ruler to the Hindu masses, and that is why the Muslims support the introduction of representative government in one case and oppose it in the other. The dominating consideration with the Muslims is not democracy. The dominating consideration is how democracy with majority rule will affect the Muslims in their struggle against the Hindus. Will it strengthen them or will it weaken them? If democracy weakens them, they will not have democracy. They will prefer the rotten state to continue in the Muslim States rather than weaken the Muslim ruler in his hold upon his Hindu subjects. The political and social stagnation in the Muslim community can be explained by one and only one reason. The Muslims think that the Hindus and Muslims must perpetually struggle; the Hindus to establish their dominance over the Muslims and the Muslims to establish their historical position as the ruling community—that in this struggle the strong will win, and to ensure strength they must suppress or put in cold storage everything which causes dissension in their ranks. If the Muslims in other countries have undertaken the task of reforming their society and the Muslims of India have refused to do so, it is because the former are free from communal and political clashes with rival communities, while the latter are not."


History for us is either to be hidden or invented. We tell and retell what we like of it, and of what we don’t, we scrunch it up and slip it under the mattress, and then perch ourselves cross-legged over it to retell a little more. We are born storytellers. A lap and a head is all we need. As for truth? Well, it is not there; it vanished from view; and so it never happened.

But it did happen. Ambedkar did say these things on Islam and Indian Muslims. In doing so, he gave a choice to us, for he knew us only too well. We could either discuss his views on Islam openly like we do his views on Hinduism, or we could scrunch them up like a plastic bag and slip it under our mattress. He did not live long enough to witness the option that we chose but being the seer that he was he had an inkling. As a preface to his book, he wrote:

"I am not sorry for this reception given to my book. That it is disowned by the Hindus and unowned by the Muslims is to me the best evidence that it has the vices of neither, and that from the point of view of independence of thought and fearless presentation of facts the book is not a party production. Some people are sore because what I have said has hurt them. I have not, I confess, allowed myself to be influenced by fears of wounding either individuals or classes, or shocking opinions however respectable they may be. I have often felt regret in pursuing this course, but remorse never.

“It might be said that in tendering advice to both sides, I have used terms more passionate than they need have been. If I have done so it is because I felt that the manner of the physician who tries to surprise the vital principle in each paralyzed organ in order to goad it to action was best suited to stir up the average Indian who is complacent if not somnolent, who is unsuspecting if not ill-informed, to realize what is happening. I hope my effort will have the desired effect."


What words. What beautiful, forceful, tender words. Here was Ambedkar, trying to goad us as a physician would paralysed organs. But he misjudged us. We remain fearful, indifferent, paralysed.

Nations that fear their past fear their future, and fearful nations worship, never follow its great men and women. Ambedkar is no exception.

Britain's role in the growth of tax havens

Andrew Verity in The BBC


Here's the received wisdom: when the British Empire faded in size and significance after World War Two, a few scattered islands around the globe wanted to keep their imperial ties to London.

The British government had to find a way to reduce the economic dependence of the likes of Bermuda, Montserrat or the British Virgin Islands, so it awarded them special tax-exempt status, creating the conditions for a thriving financial services industry.

Yes, tax evasion and money laundering may have got a little out of hand from time to time, but overall it succeeded in lifting them out of dependence on the UK government.

But there's a deeper story. It wasn't by design that the remnants of a dying British Empire morphed into a world leader in offshore financial services, selling secrecy and tax avoidance to multi-nationals and the wealthiest individuals in the world.

Instead, the crucial moment was more of an accident - which gave rise to advantages no-one had foreseen.

And it began not in Bermuda or Jersey but in another offshore centre - "offshore" not to the UK, but to the US - the City of London.



Incentives to avoid

When the 20th Century began, income tax was in single digits and progressive taxation - charging richer people a higher rate - had barely begun.

In the run-up to World War One, chancellors of the exchequer - from Asquith to Lloyd George - began raising taxes to pay for social reforms, such as the old age pension.

As the war progressed, the state demanded more and more income tax from every citizen and higher rates for the wealthy, leading to a top rate of 30% by 1919.

Accountants to wealthy individuals began to devise ways to avoid tax. Clients could become resident in Jersey, where tax rates were far lighter.

Or, if they wanted to stay in London, they might put their money in a trust registered elsewhere, perhaps on the Isle of Man, where in theory it was no longer the
irs - and therefore not visible to the prying eyes of an Inland Revenue inspector.

David Lloyd George served as Chancellor in Herbert Henry Asquith's government, before rising to PM in 1916

But it was in the dying days of the Empire that the offshore financial services industry truly boomed.

Defined by purpose rather than geography, "offshore" means any jurisdiction that seeks to attract investors on the basis of light taxes and looser regulations.

On that basis, the epicentre of the offshore industry is not Nassau in the Bahamas or George Town in the Cayman Islands.

As author Nick Shaxson points out in his fascinating offshore expose, Treasure Islands: "The modern offshore system did not start its explosive growth on scandal-tainted and palm-fringed islands in the Caribbean, or in the Alpine foothills of Zurich. It all began in London, as Britain's formal Empire gave way to something more subtle."


By accident - not design

In 1957, Britain and its imperial remains were trying to recover from a financial crisis. The previous year the UK had joined forces with France and Israel to try to recapture the Suez Canal after it was nationalised by the defiant anti-colonial Egyptian President, Gamal Abdel Nasser.

Viewing the invasion as European imperialism at its worst, the US refused any assistance.

By the end of 1956, a run on the pound was under way. The Bank of England wanted to curb the outflow of pounds by boosting interest rates sharply, but Her Majesty's Treasury had other ideas.

Since the Bretton Woods economic conference of 1944 towards the end of World War Two, countries had agreed to control movements of capital to curb the speculative flows into and out of countries that had worsened the economic crises of the past.

If, say, Tate & Lyle wanted to invest several million pounds in a new sugar production facility in Jamaica, it would need signed approval from Her Majesty's Treasury.

Normally this was a formality. But during the Suez crisis, the Treasury announced that, on a temporary basis, it would no longer approve foreign capital investments.Image copyrightREUTERSImage captionThe Bank of England did not get its way against the Treasury

The City's merchant banks were alarmed. Arranging finance for projects in the former colonies was their lifeblood. How would they avoid ruin?

Digging through the archives, financial academic Gary Burn unearthed what happened next.

Hearing the banks' complaints in a series of meetings, the Bank of England agreed in late 1957 to allow the commercial banks to continue to lend and borrow to foreign clients on two conditions:
the lending had to be in a currency other than sterling, and
both sides of the transaction - the lender and the borrower - had to reside somewhere other than the UK

"The decision was momentous in all respects," says one of the leading experts in offshore finance, Prof Ronen Palan of City, University of London. "They simply deemed certain transactions as not taking place in the UK. Where did the transactions take place for regulatory purposes? Nowhere.

"I think it wasn't at all by design; it was a mistake. They didn't understand the implications. It was seen as an accounting device."

The so-called "Eurodollar" was born - a global offshore financial market, transacting in dollars and allowing unlimited sums to be borrowed and lent, but under the control of no single state. No act of Parliament (or Congress) sanctioned the decision. There was no thoughtful policy-making, no careful debate.


Success of the Eurodollar

The Treasury was at first left in the dark. But within years the implications were obvious - this could revive the City of London's fortunes.

"By the time the Treasury figured it out, they thought, 'this is good business for the City'," said Prof Palan.

Banks from all around the world could borrow and lend in dollars without being subject to US tax or banking regulations - making banking in dollars more profitable out of London than out of Wall Street.

Offshore banks didn't have to hold money in reserve for every dollar they lent (as they would in the US), which would dramatically cut their costs.

While transactions were arranged in London, the lenders and borrowers could be registered anywhere. But the parties to Eurodollar transactions needed addresses.

So, zero-tax jurisdictions from the Cayman Islands to the Montserrat were used by London's investment banks as the official tax residences of their wealthy customers.

Clients could avoid both tax and undesirable scrutiny - for example from the US tax authorities.

In the British Overseas Territories, local laws were passed to attract more registration business, collecting modest fees that mounted up. No need for a bank branch out there - just a drawer in an offshore lawyer's filing cabinet.

The City of London began its recovery to become the centre of finance it is today
Howls of protest from the US government were ignored. Between 1960 and 1970, the size of the Eurodollar market went from $1bn to $46bn.

In the 1970s, countries rich in petrodollars from soaring oil prices were faced with a dilemma: repatriate the money to New York - where they would be taxed on it - or keep it offshore.

By 1980, the so-called Eurodollar market was worth more than half a trillion.

After the deregulation of the City of London in the 1986 "Big Bang", US banks joined in, setting up in London.

And as the 1990s and 2000s progressed, it became the undisputed global centre for foreign currency trading.


Not for the weather

Banks' wealthy individual and corporate clients didn't incorporate in the Cayman Islands or the British Virgin Islands because they liked the weather there - many never visited.

Offshore centres were attractive to businesses looking to reduce their tax bill, but sometimes, more importantly, to avoid what they regarded as excessive regulation.

Cayman Islands-registered companies were used heavily, for example, by the energy giant Enron as it built its business model based on fraudulent accounts.

Tax-free, light regulation jurisdictions, including the Bahamas, the Cayman Islands and Delaware in the US, became the corporate locations of choice for legitimate hedge funds.

They were also used to incorporate the vehicles at the heart of the global financial crisis - the 'structured investment vehicles' that did not show up on bank's balance sheets and bought billions of mortgage-backed securities, massively increasing the unnoticed risks in the global financial system which led to the crisis of 2008.

Likewise, the British Virgin Islands has been used by many legitimate businesses. It has also become the favourite secrecy jurisdiction for clients of the Panama-based law firm exposed in last year's Panama Papers revelations, Mossack Fonseca.

Since those revelations, governments around the world have pledged to improve transparency with measures such as automatic information sharing and registers of beneficial owners of offshore companies.

Many of those measures are yet to be enacted or tested.

But as the Paradise Papers are now confirming, the secrets of Britain's offshore empire are no longer quite so safe.

Why employers ignore abuse complaints

Michael Skapinker in The Financial Times


“We all knew about it! We. All. Knew,” Vicky Featherstone, artistic director of London’s Royal Court Theatre, said of the sexual abuse scandal that has rocked the film and theatre industries. 

People felt that, as long as it was not happening in their rehearsal rooms or their theatres, they weren’t responsible, she told The Guardian. “I just can’t believe that we’ve all colluded,” she said. 

Allegations of sexual abuse by top executives are rarely a surprise to those who work for or with them. So why does it take a newspaper investigation or a small number of brave individuals to uncover what so many on the inside already knew? 

First, complaining is like leaping off a cliff on your first sky dive. Once done, there is no going back. And the risks of it going wrong are huge. Those who complain are usually, at best, ignored. Otherwise, they are often crushed by the superior force of the organisation’s lawyers and drummed out of the industry. 

In many years of talking to whistleblowers and complainants about corporate abuse, I have not met any who emerged undamaged. The problem with my skydiving analogy is that skydivers have a far higher chance of landing unscathed. 

An allegation of abuse or harassment threatens not just the managers concerned but also the way the organisation sees itself 

And sexual abuse is only one aspect of organisational harassment. There are other ways managers misuse their power, such as systematic bullying and victimisation. 

When people do speak up, organisations usually fail to respond or hit back at the complainants, alleging, for example, that their performance has been poor. 

An allegation of abuse or harassment threatens not just the managers concerned but also the way the organisation sees itself. All enterprises have a purpose, an ethos, what we have come to call a corporate culture. Suggesting that mission is flawed threatens not only the organisation’s leaders, but its employees too. 

We devote most of our waking hours to working for our organisations. If someone suggests that everything we are doing is built on managers’ nefarious behaviour, what does it say about us that we are putting up with it? Those who speak out often find that their fellow workers prefer not to know. 

When those who complain get nowhere, “a subtle complicity evolves among the other employees”, an article in the Academy of Management Executive journal said. That complicity compounds the other employees’ shame at not speaking out, and makes it less likely that they will do so in future. 

Analysing “deaf ear” syndrome, the article, by a group of academics at the University of North Carolina, compares companies that close ranks against complainants to narcissists “who need to maintain a positive self-image and engage in ‘ego-defensive’ behaviour to preserve their self-esteem”. 

If the misbehaviour does come out, the article says, the damage to the organisation is often extensive — in compensation payments, the departure of senior employees and reputational damage. 

Does the recent flood of allegations mean people will be more willing to speak up? 

Well, that Academy of Management article appeared in 1998, nearly 20 years ago. It followed a string of sexual abuse scandals at Mitsubishi, the US Army and the US branch of Astra, the pharmaceuticals company that is now part of AstraZeneca. In the biggest settlement at that time, “Mitsubishi agreed to pay $34m to several hundred women who had alleged unheeded claims of sexual harassment over a period of years”, the article said. 

Yet here we are again, with serious allegations against, among others, Harvey Weinstein, co-founder of the Weinstein Company, and Kevin Spacey, former artistic director of London’s Old Vic theatre. 

Will things change? Will those who suffer abuse be readier to speak up, and are managers more likely to believe them and take action? One can hope so. But organisations’ drive to protect themselves and their own self-image will not go away. 

Real change would require independent third parties that people can report to, and impartial hearings. With trade union membership falling and access to legal representation increasingly out of reach of ordinary people, complaining remains as daunting a first step as ever.

Ex-cricketers are candidates for post traumatic stress disorder

Suresh Menon in The Hindu



It is that time again — when a long-serving, much-respected cricketer has questions thrown at him, which, in summary is: isn’t it time to retire, buddy?

Years ago, Anil Kumble’s young son wore a T-shirt with the legend: It’s time to call it a day. It probably referred to his bed time, but those who saw it couldn’t help thinking it was a gentle reminder for his father, who, however, was smart enough to pick his time of departure.

Mahendra Singh Dhoni, who has quit Tests, is now being questioned over his relevance to the white-ball format. He would like to play the 2019 World Cup — and has the support of national coach Ravi Shastri — but spirit and flesh aren’t always in consonance towards the end of a sporting career.

Sport is a wonderful servant when you are young and fit. It will joyfully carry you to the top, unmindful of your occasional mistakes, with the promise that whatever happens there is always tomorrow. But it’s a terrible master as you grow older, demanding, unforgiving of lapses, reminding you constantly that your tomorrows will never match your yesterdays.

Ageing cricketers make a pact with time: let me make one more century, bowl my country to one more win; it doesn’t matter if the century is unrecognisable from the one I made ten years ago or if my bowling lacks bite. Just once more, and in gratitude I promise to quit.

But few players keep their end of the deal. Kapil Dev was carried around in the end like a grandmother everybody had to be kind to because she was responsible for all the family wealth. His goal? Richard Hadlee’s then world record 431 Test wickets. When past admiration combines with present pity, it is not a pretty picture.

When Brian Lara retired, he asked his fans, “Did I entertain?” For the average fan, it is impossible to understand or even imagine the feelings of a national hero, who once played as if there was no tomorrow but suddenly realises that there might not be a today even. I think it was Hemingway who said retirement is the ugliest word in the language.

Can you go easily from playing the world’s fastest bowlers, guiding your country to victories, having a whole stadium, perhaps a whole nation chanting your name, and being, to quote John Lennon, “more popular than Jesus Christ”, to an ordinary life of buying groceries and and attending PTA meetings while watching someone else’s name being chanted nation-wide? If you think about it, ex-cricketers are prime candidates for post traumatic stress disorder.
This, despite the easy familiarity which cricketers develop with the big issues that are usually pushed into the back of the mind. Cricket — in fact, all sport — prepares us for loss, failure, even death. A batsman dies symbolically every time he loses his wicket. Yet, there is always another innings, another match, another year which converts apparent finality into something temporary, something one gets over in time.

Retirement is different. The finality is final. Only so many ex-players can coach, commentate, write or get into administration to maintain their connection with the game. Others are pulled out of obscurity on special occasions, like the World Cup. Till 2011, players who had won India the 1983 World Cup were featured in the media every four years. Now they will have to share the spotlight with the Class of 2011, if at all.

Retirement can be traumatic. Few teams invest in a system that makes the player’s transition smoother and more natural. For most players, cricket is the only thing they know, and when that is gone from their lives, the void can be difficult to fill. Some fill it with alcohol.

There is an organised system which prepares a gifted youngster to play for India. He is given technical, temperamental, tactical, strategic guidance as he graduates through the age-group tournaments. And then, in the early or mid-twenties, he plays for the country. It is the start of a wonderful ride.

If he is good enough, he plays on for a decade and a half, or more. But there is no similar organised system at the other end of his career. Unlike a couple of generations ago, today money is no longer a problem. But relevance is, self-esteem is, acceptance is. It is difficult to walk into a room and realise that you no longer turn heads. You might still sign autographs, but then might have to answer a young fan’s devastating question: “What’s your name?”

Some are happy to leave, to put the training and discipline behind them. Steve Redgrave, multiple gold winning British rower once finished with, said “I’ve had it. If anyone sees me near a boat they can shoot me.” But the more common feeling was expressed by the US jockey Eddie Arcaro: “When a jockey retires, he becomes just another little man.”

Dhoni is capable of walking away without looking back. He has other passions. But till he does, the question will follow him everywhere.