Monday, June 13, 2005
Are Arabs the Greatest Fools?
- 1997 was the start of the ‘Asian financial crisis’ that also hit other 3rd world places around the globe like Brazil and Russia,
- at the same time, the internet boom was fuelling Greenspan’s famous ‘irrational exuberance’ in the US that peaked in 2000,
- 2001 saw the start of widespread discovery of US corporate scandals behind Greenspan’s ‘infectious greed’ whose aftermath we are still witnessing today
(see this report http://www.latimes.com/business/la-fi-enron11jun11.story)
In early 2001, some ‘analyst predictions’ had it that the Dow would rise to 20,000 where P/E ratios would be 40.
While ‘econom-ignoramuses’ like me were scratching my head trying to understand how that would make sense, there were also Asians I know of that were very sure that the American ‘boom’ had sound basis.
According to them, it was really quite simple : the simpleminded fella in me may think that all things are equal and smart money should enter markets whose PEs are lower (go to Asia in this case) and the PEs would converge.
But since that was not happening, things were therefore not really equal – according to my friends, American management were in essence ‘better’ than Asian management (http://cckplanetblog.blogspot.com/2001_07_01_cckplanetblog_archive.html).
Although my then suspicion on what was behind the American ‘boom’ was not quite on the mark, at least I was suspecting something was not right.
Sometime in second half of 2001, a short report in the Straits Times quoted a Saudi prince saying ‘cheap does not mean good buy’. According to the report, the prince was approached by the ‘new’ JP Morgan Chase to buy bonds issued by Enron, and the reason given by this American bank was that the prices of Enron bonds were low and therefore good buys.
Actually, any Asian idiot could have said that but these are good American managed companies so it's different. At that point in time I wondered why the Saudi prince went public with such comments.
Before year's end Enron had filed for bankruptcy protection, and its 2 biggest creditors were Citigroup and, none other than, JP Morgan.
So what had actually been attempted earlier was a classic ‘con’ job.
Those American banks knew what state Enron was in and were trying to ‘screw’ the Saudi prince by getting him to buy the soon to be worthless bonds!
Today, of course, we know that a lot of American investors (which should have ‘better management’ according to some hypothesis) were burnt by Enron, and are seeking re-dress from these banks who are the epitome of American finance.
In his maiden visit to Asia as CEO, the ‘last CEO’ of JP Morgan (before it became JP Morgan Chase) declared that the market is always more creative and therefore always ahead of governments and regulators. Because of that, the private sector ‘understands their business much better than regulators’, and governments and regulators should therefore let the ‘market regulate itself’.
I was among the JP Morgan staff present then. That was in 1995 or 1996, way before Greenspan observed the ‘irrational exuberance’ around him.
This CEO fella was so great that he ended his career by selling JP Morgan off to Chase in late 2000, a year before the Enron debacle surfaced.
A coincidence? Whatever the case, I know of people that still harp after this CEO fella I know.
Today, we also know that Enron was not just a once off incident attributable to a couple of rogue American businessmen, but the same had happened with the likes of Worldcom, Global Crossing, Tyco etc. (yes, those banks tried to screw more than just Arabs more than once).
And we all know that the optimistic ‘analyst predictions’ of the 20,000-level Dow were really backed up by ‘future-potential hot-air’ peddled by the likes of Martha Stewart, and the mass cooking of books by companies and their financiers who according to Joseph Stiglitz employed ‘accounting trickery’ attributable to the lack of sound regulation i.e. this is a systemic problem (http://www.salon.com/tech/feature/2002/07/03/stiglitz/?x)
Today, I still have people telling me how great ‘free market’ is and how through its own magic (like the ‘price mechainsm’) the market will somehow solve all problems as long as people like governments do not ‘interfere with the market’ (the famous laissez faire).
On this, they cite some minor economists like Milton Friedman (just another goyok seller to me) and his theories.
Of course, you get a completely different view from other economists like Joseph Stiglitz.
To simpletons like me, the principle is quite simple: if you want to ‘drop names’ and quote blindly, at least pick someone with more credentials like Mr Stiglitz lah. At least this fella has a Nobel prize to back his views up.
So who do you think are greater fools: the Arabs like our Saudi prince above, the American investors screwed by the great American management of the likes of Enron and its bankers, or the Asians that think that American managers are ‘better’ than Asian ones and harp blindly about the magical greatness of ‘free market’ and ‘laissez faire’?
You decide.
Bank Settles Enron Lawsuit
· Citigroup, accused of defrauding investors by disguising loans to the fallen energy trader, agrees to pay $2 billion. It denies any illegality.
By Josh Friedman, LA Times Staff Writer
Wall Street giant Citigroup Inc. agreed Friday to pay $2 billion to settle a class-action lawsuit that accused the bank of defrauding the University of California and other investors through its work for fallen energy trader Enron Corp.
The deal, the biggest yet stemming from the 2001 bankruptcy that came to symbolize corporate corruption, could set the stage for other hefty recoveries in the Enron fiasco.
"This is a big, big step in the right direction," said William S. Lerach, a San Diego lawyer who represented UC. The settlement is "a very favorable portent for the future" as negotiations proceed with other defendants, Lerach said.
Separate claims are pending against JPMorgan Chase & Co., Credit Suisse First Boston and other financial institutions that allegedly helped Enron hide mounting debt through elaborate accounting tricks.
Other settlements could reach or exceed hundreds of millions of dollars, analysts said, although the Citigroup deal is expected to be among the largest because it was one of the Houston company's biggest lenders.
In a statement, Citigroup denied violating any law and said it agreed to settle "solely to eliminate the uncertainties, burden and expense of further protracted litigation."
Citigroup, the nation's largest financial institution, said it had ample legal reserves to cover the payout.
The Citigroup settlement dwarfed earlier deals made by Enron investors with Lehman Bros. Holdings Inc., Bank of America Corp. and others that totaled $492 million. Separately, Citigroup, Merrill Lynch & Co. and other banks have paid about $460 million to government regulators to settle Enron-related allegations.
The class-action settlements could eventually mean a multimillion-dollar recovery for UC, which lost $145 million on its Enron stock investments. But no distributions will be made until all outstanding claims are resolved, and university officials said it was too soon to determine how much they might get back.
UC, whose investment portfolio now totals $63 billion, said the losses had no effect on retiree benefits or on programs funded by its endowment.
Enron's downfall cost investors an estimated $40 billion to $45 billion as its financial house of cards collapsed, crushing its once-highflying stock and prompting rating agencies to cut its debt to "junk" status. Lawyers said it was unclear how much of the loss was attributable to fraud and recoverable under the law.
Under the settlement, investors who bought Enron stock or bonds from Sept. 9, 1997, to Dec. 2, 2001, when the company sought bankruptcy protection, can seek recovery of damages. UC lawyer Lerach estimated that 50,000 investors might file claims.
"Every Enron investor who lost money should … keep their records up to date," he said.
Under their fee agreement, lawyers for the plaintiffs stand to get 8% to 10% of the amount recovered.
The UC-led suit accused financial institutions of helping Enron raise money even as it was secretly imploding. UC, which in February 2002 was named lead plaintiff in the consolidated class actions, claimed that the banks participated in a host of schemes that violated securities law.
Citigroup, for example, allegedly disguised loans to enable Enron to present a misleading picture of its balance sheet.
The suit said Citigroup lent Enron $2.4 billion in a series of deals identified as "swaps" and nicknamed Delta transactions because they were conducted through Citigroup's Cayman Island unit, called Delta. Citigroup paid Enron hundreds of millions of dollars each time, obligating the company to repay the cash over five years.
Although the transactions were in fact loans, they were never disclosed as such on Enron's books. The plaintiffs alleged that Enron was seeking to conceal the full amount of its debt so that regulators and investors would be unaware of its precarious financial position.
Based on its investment grade rating at the time, Enron could have gotten credit at much lower rates, but it paid Citigroup and JPMorgan 6.5% to 7% for the "disguised loans," making the deals hugely profitable for the banks, the plaintiffs said.
In late 2001, after revelations about Enron's accounting made headlines, Citigroup and JPMorgan unsuccessfully sought to arrange the company's sale to rival Dynegy Inc. so they could split a $90-million investment banking fee and stave off its likely bankruptcy. The suit said calls to credit rating firm Moody's Investors Service by Robert E. Rubin, a former Treasury secretary who was then Citigroup's vice chairman, and by JPMorgan Chairman William Harrison were attempts to "strong-arm" the firm to prevent it from downgrading Enron before a sale could be completed.
The latest deal could help Citigroup shake the scandals that have tarnished its image and slowed its growth in recent years. The bank, which last year saw its profit drop for the first time since 1998, has been barred by the Federal Reserve from making major acquisitions as it scrambles to clear a spate of regulatory problems in the U.S. and abroad.
Last year, Citigroup agreed to pay $2.6 billion as part of a record $6.1-billion settlement by banks, auditors and former board members to resolve class-action claims resulting from the 2002 downfall of telecom giant WorldCom Inc. In March, Citigroup agreed to pay $75 million to investors in the defunct fiber optic network Global Crossing Ltd.
Citigroup Chief Executive Charles Prince called the latest accord a positive step for his firm.
"It is a key priority for Citigroup to resolve major cases like this one and to put a difficult chapter in our history behind us," Prince, who succeeded Sanford Weill in October 2003, said in a statement.
Henry Hu, a corporate and securities law professor at the University of Texas at Austin, said the Fed sanctions had given Prince an incentive to get Citigroup past its scandals.
"This happened on an earlier watch. Prince wants to get rid of the baggage of the past," Hu said.
Trey Davis, UC's director of special projects, noted that the university's Enron losses represented less than 0.3% of its funds under management at the time, and a smaller percentage of current assets.
"UC's investment funds remain strong and there was no significant impact on either our portfolio or the benefits provided to retirees," Davis said.
"While it is not possible to recoup all of the investors' losses in such cases — especially when the fraudulent company is bankrupt — the university has pursued a meaningful recovery … for the shareholders."*
(BEGIN TEXT OF INFOBOX)
Enron settlements
Citigroup's $2-billion payment to settle claims by Enron shareholders is the largest yet in a series of deals with investors and regulators in connection with the energy trader's 2001 collapse.
August 2002: Andersen Worldwide, parent of auditor Arthur Andersen, says it will pay $32 million to settle lawsuits from Enron investors and employees.
February 2003: Merrill Lynch agrees to pay $80 million to settle a Securities and Exchange Commission investigation of its Enron dealings.
July 2003: Citigroup and JPMorgan Chase agree to pay more than $300 million to settle government charges that they helped Enron and Dynegy defraud investors.
December 2003: Canadian Imperial Bank of Commerce says it will pay $80 million to settle SEC allegations that it helped Enron inflate profit and hide debt.
July 2004: Bank of America says it will pay $69 million to settle a lawsuit by Enron investors over its role as underwriter for some debt offerings.
October 2004: Lehman Bros. says it will pay $222.5 million to settle a suit by the University of California and other investors over its role as an Enron underwriter.
January: Enron's insurance firm says it will pay $155 million to UC and other investors to settle a shareholder lawsuit. Ten former Enron directors say they also will pay $13 million out of their own pockets.
Friday: Citigroup agrees to pay investors $2 billion to settle a lawsuit that accused the bank of fraud in its work for Enron.
Sources: Times research, Associated Press, Bloomberg News
Los Angeles Times
Salon.com July 3, 2002
Joseph Stiglitz began explaining why markets fail long before Enron and WorldCom rose, exploded and crashed. But not many people wanted to listen during the boom-boom '90s; Stiglitz was even fired from his position as chief economist at the World Bank after he repeatedly criticized the organization's free-market obsessions. [cck note: this is not entirely correct. Stiglitz was fired from the World Bank partly because he strongly & publicly criticised the way the IMF handled the Asian and other financial crises around the world. In essence, he said that the IMF use the same 4 steps in all crises which are designed to help creditor countries screw the countries in trouble. The US government, the 'boss' of the World Bank, then had this man fired from his job].
Today, Stiglitz's lifetime of work is suddenly all too relevant. Consider, for example, his theory of "asymmetric information." Stiglitz spent years demonstrating that one party in a transaction -- say, the owner of a factory -- often possesses more information than the other about that transaction, and thus has an advantage that allows for market inefficiencies, and potentially, human suffering. His work won Stiglitz the 2001 Nobel Prize in economics, but more to the point, it handily explains why Enron and other companies successfully hid their accounting tricks for so long. Because executives have the power to determine how to arrange their profit-and-loss numbers, the theory holds, they'll always have a leg up on detectives and accountants who are trying to uncover misdoings.
From 1993 to 1997, Stiglitz served as a member and then as the chairman of President Clinton's Council of Economic Advisers. He then went on to become chief economist at the World Bank, where he stayed until 2000. At each step of his career, Stiglitz advocated for a critical look at what he calls "the Washington Consensus" -- the conventional wisdom that holds that everything bad in the economy can be laid at the government's door while everything good stems from the market.
Filled with accessible, on-the-ground examples from Ethiopia, Indonesia, Russia and elsewhere, Stiglitz's new book, "Globalization and Its Discontents," witheringly dismantles that consensus. The villains, Stiglitz argues, are obvious: The International Monetary Fund, Clinton Treasury Secretary Lawrence Summers and Wall Street all come off badly, more concerned with ideology and their own bottom lines than with the facts.
Salon sat down with Stiglitz in New York and discussed accounting trickery, why government is necessary and the present state of the world economy.
The American economy is engulfed in a wave of corporate scandal. WorldCom, Enron, Adelphia, ImClone -- the failures and frauds keep piling up. What's going on?
I think the most important, significant thing that [the scandals] bring home is the importance of regulation. You can't have markets work without good information, and it is not necessarily the case that people have an incentive to provide accurate information; [but] they do have an incentive if there are penalties for providing fraudulent information. So the government plays an absolutely essential role in enabling the markets to work.
Now there were some big mistakes made in the mid-'90s. When I was at the Council of Economic Advisers, FASB -- the Financial Accounting Standards Board -- proposed a change in the way stock options for executives would be treated. The Council of Economic Advisers supported the change, on the grounds that it would improve the quality of [corporate] information. Wall Street and Silicon Valley united to put political pressure to oppose this change. The U.S. Treasury gave in to this political pressure and put pressure on FASB, and FASB backed off.
The reasons it was so important were severalfold. First, the principle that accounting standards ought to be kept out of politics -- that principle was compromised. Secondly, it compromised the quality of information.
Thirdly, it provided further incentives for the use of stock options. And that has contributed to the whole problem we're seeing.
Why? Because with stock options, executives have an incentive to get the value of their company up as fast as possible. They found that they'll make more money if you give inaccurate or distorted information rather than honest information. One of the things I've always argued as an economist is that incentives matter, and one of the things we did there was provide incentives to provide stock options, which provided incentives to provide dishonest information.
Is that the root cause of all these accounting irregularities and alleged frauds?
That's right. There are many factors; the go-go atmosphere, the attitude that anything goes. But if there is a single thing that you can say is the root cause, it is that -- the stock option decision and the mania to which it gave rise.
How does the present situation compare to other crises in American capitalism? Are we witnessing excesses on a par with the '20s, the '80s ...?
It's a pattern that we've had frequently, and it's often associated with what I would call deregulation episodes. The savings and loan debacle, for example, where the U.S. government had to bail out [banks] to the tune of several hundred billion dollars, was basically the same thing: misreporting, trying to claim as income things that weren't income. So in fact there is a pattern here, and that pattern continually reminds us of the need to have some kind of oversight, if we're going to make the market economy work.
But the pains of the '80s seemed to disappear relatively quickly. There was a minor recession in the early 90s, but the economy recovered. Will that happen again, or is this problem on a much larger scale?
Eventually, it's going to bounce back. I have absolute confidence in that. The American economy is very, very strong for the long run. But this may, and quite likely will, extend the recovery and slow it down.
The timing couldn't be worse. The fiscal mismanagement of the current administration -- leading to a change in the fiscal position of the United States over the past year -- is absolutely phenomenal; going from huge surpluses to huge deficits and the deficits are probably going to be larger than people anticipated. That means that foreigners are already losing confidence in the United States because the United States had earned a reputation for sound fiscal management -- and now that reputation is being destroyed. The United States had a reputation for the best accounting standards in the world; now people are saying, we don't know.
The last time excessive doubt in the U.S. economy occurred -- during the Depression -- new regulation followed. How will this episode affect the structure of capitalism, here in the U.S. and abroad?
It is an important warning. The view of capitalism in the late '90s was of a particular form; American capitalism was triumphant. The view was that you don't need regulations -- just let it rip. Now people are becoming much, much more cautious. They're looking at what America said at that time with a lot more circumspection. There's a recognition that there's a downside. And just like the lesson of the Reagan era -- the excessive deregulation of banks -- led most countries to recognize the importance of sound financial regulation, I think that this episode is going to lead people to say there ought to be sound accounting regulations, sound regulation on corporate governance, things that were insufficiently talked about before.
It's also going to mean that the premise that American accounting standards are better, say, than European standards, is no longer going to be convincing. People are going to say let's look at alternatives. There isn't one way, there are alternatives. Sometimes the American way is best but sometimes Americans ought to learn from others, and the accounting standards in Europe may in fact be a better system for dealing with the complexities of the current world.
Is that a sign of progress -- moving away from an American-centric economic worldview?
Yes, I think it is.
You mentioned that the Bush deficit isn't helping matters, but in terms of future policy, what needs to be done and do you think that Bush will do it?
What is interesting is how slow they've been to recognize the problems. We're now beginning to recognize the broader set of issues, what you might call conflicts of interest. Merrill Lynch brought those issues out into the open; that if a firm is trying to sell a stock through its brokerage houses, trying to get business through its IPOs, those conflicts of interest can lead to bad decisions.
But if you could name a list of things -- 1, 2, 3 -- that Bush and Congress could do to reinstill confidence in the markets and economy, what would they be?
We need to begin to think much more carefully about these issues of conflicts of interest, which are pervasive. We saw it in the accounting area, where the accountant firms have conflicts of interest between their role as consultants and their role as accountants. In the 1930s, the Glass-Steagall Act was passed, which talked about why we needed to separate out investment banks from commercial banks because of the potential conflicts of interest. I think another mistake that was made in the '90s was the repeal of that. The point was made that people were getting around it, and that was used as an argument against it. Well, there were two strategies: Do you try to limit the ability to get around it, or do you abandon it. I think they made the wrong choice.
Part of the reason they made that choice was because of Wall Street lobbying. Even now, post-Enron, most attempts at reform have been stalled due to opposition from Wall Street. How can anyone who wants to reform the system overcome such a powerful force?
It will be overcome when there is enough popular support, and when the problems begin to rebound seriously enough against the industry. Let me go back to another example. At the end of the 19th century, it was the food industry -- the meat industry -- that asked for government regulation. Why? Because as a result of Upton Sinclair's book "The Jungle," people said we don't trust meat. And they said, we'll trust the government if it starts inspecting the meat. So the industry demanded regulation to restore confidence.
Do you really think that will happen?
Henry Paulson [chairman of Goldman Sachs] has begun talking about the problem and you have to think that it's partly because of a recognition that if investors lose faith in American firms, they're going to put their money elsewhere. And that is going to be very bad for Wall Street. There are going to be two sources of concern: one, voters; secondly, investors
Do you think that the current corporate implosions will undermine the force of the free-market fundamentalists -- who you identify as the Washington Consensus? Will fears of a lack of U.S. regulation extend to the world of international development?
Well, what we're beginning to understand is that Wall Street is not the font of all wisdom that a lot of people in the '90s tried to sell it as -- especially the people on Wall Street. For instance, in the 1990s Wall Street pushed for capital market liberalization -- opening up companies to speculative money that could come in and out overnight. We now realize that capital market liberalization has contributed a great deal to the instability in the world: to the East Asia crisis, the global financial crisis. At the beginning of that crisis, Wall Street, U.S. Treasury, IMF said, Oh that's not the source of the problem. In fact, they said, speculative money is too small to be possibly a problem. A year later, when Long Term Capital Management was in trouble, the same kinds of people were saying that we need to bail out Long Term Capital Management because if we don't, this one firm -- one firm! -- could bring the whole global financial system down. Now, that kind of inconsistency, that kind of hypocrisy, caused a lot of people concern. Now what we're seeing is that there's a systemic problem; it's not just one company, it's many companies. And I think that breaking of the confidence in Wall Street is leading people to reexamine not only Wall Street but the influence it has had on the IMF, and in turn, the IMF policies and their consequences for the developing world.
Let's talk about those policies. You focus on Russia as an example of a failed IMF country, citing decreased gross domestic product, increased poverty and a widening gap between rich and poor -- most of it caused by a rapid, corrupt privatization process. But when I was reading about the new class of Russian oligarchs, I couldn't help but think that they -- not the IMF -- were the real source of the problem. Why not focus on holding the thieves accountable rather than blaming the IMF?
But incentives matter, and if we don't create the right incentives, we get bad behavior. As we talked about with the case of Enron, we had incentives to overstate profits, to get the stock prices up, and they responded to those incentives. In the case of Russia, the IMF helped create incentives that led to people taking their money out of the country. Let me explain: The IMF pushed these countries to have very rapid privatization, before they had corporate governance, while the economy was still in recession, and they pushed the privatization so rapidly that it was almost inevitably a corrupt privatization. At the same time, they pushed them to open up their capital markets. Think of yourself as one of the oligarchs that have managed to persuade Yeltsin to give you -- for a pittance -- these natural resources worth billions of dollars. Then you're told effectively by the IMF that you can either invest that money in Russia, which was in recession or depression, or take that money to the United States or a secret bank account. If you're smart enough to get Yeltsin to give you a billion dollars, you're smart enough to take your money out. Moreover, you would recognize that if you left your money in Russia, there was a good chance that in a couple years' time, the successor of Yeltsin might say, You got that money illegitimately. We want it back. And if you have your money in the United States or Cyprus bank accounts, they can't get it back. If you have your money in Russia, they can get it back. So it was their own self-preservation that led them to take their money out. But of course, as they all did that, the economy of Russia went further and further down. The culpability lies with setting up incentives that led people to behave that way.
Critics have argued that you underestimate the gains that have come from IMF policy, which you identify as the high-speed "hare" approach, compared to your gradualist "tortoise" approach. Poland, for example, underwent "shock therapy" and came out better than other countries in the region, like Ukraine, which followed a more gradualist approach.
Let me put it in the following way. What is fast and what is slow depends on what you're doing. Poland quickly brought down hyperinflation; that needed to be done fast. It brought down hyperinflation to moderate levels, 18-20 percent. It didn't push it further than that in the first instance. It then began a process of very gradual reform. So it, Hungary, Slovenia -- these were the tortoises. These tortoises have won the race. They are the economies with a GDP that's higher than it was 10 years ago. The hares are further behind. Their GDP is much lower than it was 10 years ago. Now of course there are some that are neither tortoises nor hares -- that aren't doing anything: Belarus, Ukraine. No one said that those are models you ought to follow. The model was, yes, have reforms but have it in a paced, balanced way. And Poland, Slovenia, Hungary show that there were alternatives to the "shock therapy." In fact, the deputy prime minister of Poland in 1993-95, when they were going through these changes, was very explicit that their success was a result of their not following shock therapy policies. It was that they did it with a systematic, gradual policy of structural reform. There are some things that you can do quickly, but changing societies, you can't do overnight. But if you do it in the right way, you actually do it in a reasonable length of time.
What is a reasonable length of time -- particularly when it comes to identifying what's succeeded and failed?
We are never really sure, but what we do know historically is that if Russia's economy is down 30 percent from what it was [in 1989], and let's say they start growing 4 or 5 percent a year, it's going to take them another decade or two just to get back to where they were. In that sense, yes, there will be ups and downs; the race is never over. But the shock therapy has cost the Russian people enormously, not only in terms of GDP. Their life expectancy is down while the rest of the world has life expectancy increasing. These are the kind of consequences that have resulted. Poverty went from 2 percent of the population to over 40 percent in 1998. These are just enormous changes.
You've argued that part of the problem is that the IMF doesn't pay attention to these social costs. Why is that? Why don't they look beyond things like GDP?
There are two or three answers to that question. One of them is that their major responsibility has been macroeconomics. At one point, the head of the IMF even said "we aren't concerned about poverty." They wanted to just look at macroeconomics -- and in fact, they didn't do a very good job of that. Secondly, they believed, a lot of them, in trickle-down economics: If you can succeed in getting [an economy] to grow, everyone would benefit.
In the United States, we've rejected trickle-down economics; you have to have pro-poor growth policies if you're going to succeed. It isn't necessarily true that a rising tide lifts all boats. Some are left behind.
Thirdly, they had a fixation on financial markets. Historically, people with that kind of focus worry more about inflation than they do about unemployment [because inflation does more immediate damage to their investments]. They worry less about poverty than they do about what will happen to the capital markets. In my view, a lot of that has been shortsighted. It is a mistake to ignore the social and political consequences of policies. Even if you don't worry yourself about poverty, it is bad economics. When the IMF cut out the subsidies for the food and fuel to the poorest people in Indonesia, it led to riots. Those riots led capital to flee and that exacerbated the economic downturn, the depression, in the country. So ignoring the social consequences is bad economics.
What do you make of the crisis in Argentina? Two people were killed June 26 in protests, while their economic minister was in Washington asking for the IMF to reinstate an $18 billion credit line. Should the IMF give in?
The issue in Argentina shows that the IMF still hasn't learned a lesson about the risks of contractionary fiscal policy. For 60 years economists have said that when you're in a recession you need expansionary fiscal policy. In the United States, during the much milder recession of 2000-01, both Democrats and Republicans said we need a stimulus. But what was the IMF doing in Argentina? The same thing it did in East Asia, which was insisting on a contraction, making the downturn even worse.
But you argued in your book that less IMF intervention should occur overall because lenders have come to expect and depend on international bailouts; they've been encouraged to loan money to high-risk borrowers because the IMF has acted like an insurance policy. So perhaps the IMF refusal to help is a necessary evil, a way to correct expectations.
The general principle that bailouts have not worked is becoming increasingly recognized. The bailouts did not work in Indonesia, Thailand, Korea, Russia, Brazil and now in Argentina. I don't think that the critical issue facing Argentina today is outside money. Most of the money that Argentina is likely to get will do nothing more than repay already existing loans. What Argentina needs to do is restart their economy. The human resources, the physical resources are still there. What they need is money, not to repay the IMF, not to repay the other loans that are outstanding, but money that can go to corporations that will allow them to buy the inputs, that will allow them to start producing goods that they can then sell and export.
So not a bailout but rather a stimulus ...
They need a stimulus, and that will require some money. But that's very different from a bailout. And what worries me is that if the price of getting a bailout is more contraction, it's going to exacerbate the problems.
Even if the IMF is still screwing up in Argentina, there are signs of reform.
They've accepted responsibility for the Asian crisis and have enacted many reforms in the past few years. Are you encouraged by the institution's progress?
There have been some very encouraging signs. Now, they are recognizing the importance of poverty and the consequences of their policies for poverty.
What's your take on the anti-globalization protest movement? By trying to abolish the IMF, a stance also favored by Milton Friedman, are they making matters worse? Or are they an important catalyst for change?
I think that globalization -- which is nothing more than the closer integration of the countries of the world, as a result of lowering transportation costs, communication costs, the elimination of artificial barriers -- is something that's going to be with us. As this integration occurs, as we become more interdependent, we need to have rules and regulations. So if anything, today we need international institutions more than ever. The problem is that confidence in these institutions is lower than ever.
So my view is that if we abolished the IMF, we'd end up re-creating it. And the real danger is that we'd re-create it with some of the same blemishes that it has today. So it makes much more sense to me to work on reforming the institution; to return it to its original objective, which was to help countries facing an economic downturn have the resources to stimulate; so that a downturn in one country doesn't stimulate a downturn in its neighbors. Getting it to go back to some of its original mission is the right direction for it to go.
Wednesday, June 08, 2005
Why Not A Closer Russian Mirror?
http://www.themoscowtimes.com/stories/2005/06/08/007.html
I refer to the article above and the writer’s interesting 'bring back' to the 1930s. Then I wondered why he/she did not care to bring readers back to Russia's history in the 1980s & 1990s, and the lessons from the collapse of the old Soviet Union. It would perhaps be more educational to the whole world if he/she had done that.
People like me may live afar but do wonder how a few Russians like Khodorovsky and Abramovich could have had so much money to buy up those highly lucrative‘assets’ of theirs that created so much wealth for them in such a short time.
To me, their ‘successes’ were ‘fairy tales’ too good to be true. If it was so easy, past Russian communist leaders would not have been that dumb not to realize that and therefore let a few of these ‘Khodorovskies’ develop within the communist system, and then parade them in front of the world as prove of communist or Russian supremacy!
On the other hand, if democracy is really so ‘magical’, I wondered then where are the‘Khodorovskies’ of the Russian manufacturing or IT sectors?
I also wondered how the likes of Khodorovsky could have gotten the money to buy those ‘easy money assets’ they ended up having. You see, people like me still remember the widely held 'reports' before the 1990s that all Russians are poor people because of their ‘ineffective’ communist system. So unless people like Khodorovsky had got a sudden ‘windfall from the skies’ as the empire collapsed, or they got their ‘assets’ on the cheap.
Whatever the case, there are probably valuable lessons the whole world can learn from the history of your country during the 1980s and 1990s. Sadly, this was not to be the case for the writer of this article who chose to look into a distant mirror instead of the one much closer. I wonder why?
Tuesday, May 31, 2005
Presidential Demands
Comments to Today papers 31 May 2003
I refer to the recent discussions on the criteria for presidential candidates in Singapore. As the presidency is an important function that can affect the lives and savings of all Singaporeans, in typical Singapore fashion some one have decided that its selection process deserve some form of control and thus those criteria.
We read with interest a reader's comment that some former Singapore presidents would not have qualified under those demanding criteria. That included a certain Wee Kim Wee who died recently and for whom Singapore witnessed an outpouring of feelings for a simple man who touched so many with his simple ways (the most touching sight I saw was a grown-up Malay man, who regarded Mr Wee like a father, crying publicly and aloud at his funeral). I wonder if any of the 'presidential criteria' can identify such a man.
It also brought us back to Mr Wee's reported request to have a simple funeral and be buried among simple people. When he was given a state funeral some observant Singaporeans noted that another ex-president Mr Ong (the only one who would probably qualify under those presidential criteria) was not accorded the same and wondered what the 'criteria' were for state funerals.
Perhaps Mr Wee's final wishes were tempered by those demanding 'state funeral criteria' and his realization that he would not have qualified under those demanding 'presidential criteria'.
Just like the efficacy of those criteria, who knows.
A Japanese View from Opium War to Yasukuni
http://www.japantoday.com/e/?content=bbs&order=msg&author=abc2005
I did some research using google.com, and compiled a brief history of historical events between China and Japan.
1. The Sino-Japanese war in 1894-1895 ended with the Treaty of Shimonoseki. China had to pay 230 million “liang” of silver to Japan. The amount was the equivalent of 5 years of China’s revenue in 1895. Of which, 200 million were war indemnity (to be paid in 7 years, with 5% interest per year), and 30 million are in exchange for Japan to give up its demand for China to cede Liaodong Peninsula, so as to avoid “encroaching” the sphere of influence of a few other foreign countries. Japan held up the Chinese territory of Shandong (province) as a collateral before the final installment was made. By contrast, the war indemnity paid to England (same to France) in the “second opium war” was 2 million “liang”. See: http:/ / www.answers.com/ topic/ second-opium-war. (Similar amount for the first opium war.) Taiwan, a Chinese territory at the time, was ceded to Japan, and Korea became a Japanese colony and was later annexed by Japan. See: http:/ / www.ibiblio.org/ chinesehistory/ contents/ c10s08.html. The war indemnity was partly financed by interest hungry Western banks. This set a precedent, 4 years afterwards other envious powers swarmed to China to join Japan in this new front of extracting quick money (see next paragraph). Tax burden on Chinese became much, much heavier after 1895 because of the need to make the payment.
2. Japan was among the EIGHT countries (Japan, US and 6 European countries) that won another war in China during 1899-1900. After a year’s bargaining, China agreed to pay 450 million “liang” of silver in war indemnity to NINE countries (protocol of 1901). The ninth country did not participate in the war but was offered a share of the war indemnity to maintain “fairness”. The annual interest rate was 4%. The craziness in the amount is that, the annual interest payment alone was already the equivalent of 1/ 5 of China’s budget in 1901 (not to mention that the tax rate was already much higher than in 1895 because of the need to pay the previous war indemnity to Japan). In 1911, Qing dynasty collapsed, and the Chinese were squeezed to the bones. The US (was the only country that) “returned” (part of full? of) its receipt from the war indemnity, and used it to start today’s Beijing University and Tsinghua University. I should also point out that by ignorance, the Chinese ruler (the Empress Dowager), who was under stronger and stronger pressure from greedy foreign powers, made a fatal misjudgment to rely on Chinese “boxers” to fight the fully armed foreigners. Under strong emotions, she made the irrational decision to declare war on “ALL countries” (but the order was ignored by many Chinese provinces, including these in Southern, Eastern and Central China.) After 1911, China entered 20+ years of political chaos, student movement, the rise of the Nationalists and then communists, and often, civil wars and famine. It is worth mentioning that Japanese conspiracy never stopped in China. The student movement in May 4th 1919 helped Chinese government to refuse the Paris “peace treaty” in which Germany’s “rights” in Liaodong Peninsula be transferred to Japan as a reward for Japan’s fighting Germany, even though China was also considered as an ally.
3. Japan “entered” Manchuria (without any treaty) soon after 1895. China had no power to stop it. Japan in 1931 expelled the Chinese troops after they raised the flag of the new Chinese Nationalists’ government and declared themselves as followers of Sun Yat-sen. Japan then made Manchuria an “independent country” (ironically, using the fallen Qing emperor as Manchuria’s new “emperor”). Then they went on to conspire on the “autonomy” for Northern China, but were met with resistance by the Chinese from both North and South. Japan eventually expanded its “ventures” to a full-scale war against China in summer of 1937 (first shot fired near Beijing – in Northern China). The under equipped Chinese had to face the Japanese military alone for five and half years, until they were joined by the US and other allies in December 1941 (due to Pearl Harbor). In this war, more than 20 million Chinese were killed (estimates by Westerners). Japanese did all crimes possible in China during this time, including free shooting of Chinese prisoners for training purpose, live human testing of bio-chemical weapons (these war criminals were never prosecuted due to a couple of foreign countries’ hunger for the data after the war, but decades later some Japanese soldiers in its infamous “chemical unit” started telling some of the real stories).
4. The Chinese communists dwindled to a couple of ten thousand in mid 1930s, and the Nationalists (followers of Sun Yat-Sen) were about to unite the country, but Japanese invasion revived the communists. They grew to millions strong at the end of the war in 1945. The communists took all China in 1949 and committed crimes in some years of their rule. Chinese need not blame Japan for this, but it is clear that without Japanese invasion, China would never become a communist country. (It is a relief that China today in essence is no longer a communist country although it will probably take many more years for it to move to democracy.)
5. In 60 years after the war, Japan refused any hint of war reparations and turned down the lawsuits filed by numerous victims. Instead, elected Japanese leaders have in recent years started to pay annual visits to the war shrine that hosts all the 14 class A war criminals, the fanatics responsible for murdering millions and millions of Chinese (and victimizing many innocent people from the other parts of Asia and the rest of the world). These criminals are now hailed as “heroes” in Japan. It has refused to fully clean up the chemical weapons that were still left in China and instead made its resolution as a bargaining chip. They blame the Chinese (and the Koreans) for playing the “victims’ role”. (Southern Korea’s president recently said publicly, “It is unfortunate to have Japan as a neighbor”. But this did nothing to change Japan’s attitude.)
6. Elected Japanese officials keep blaming China for every little thing, although China has done nothing that really hurt Japan in substance. It is a popular game to blame the Chinese -- whether communists or ordinary Chinese. The Chinese military spending today is still less than half of Japan’s (contrary to the misconception fanned by Japan and the US right wing). Chinese military does not even have an aircraft carrier while all 3 big neighbors (Japan, Russia, India) do. In the same spirit, Japanese blame China’s backwardness SOLELY on Chinese “themselves”, and insist that Japanese fighting and pirating on China for a half century had NOTHING to do with China’s backwardness. It is true that many European countries and Japan were ruined in the World War 2 and they recovered fairly quickly after the war. However, the economic rise of the post war Europe or Japan was never reproduced in ANY country that was already poor before the World War 2. That is because it takes much less to repair than to build from nothing. This can be said for infrastructure such as highways or railway, or mines or factories, or human skills that go with industry, etc, etc. After wars ended in China in 1949, China’s DGP grew by close to 10% in an average year, but China is still a developing country because it started from half century’s destruction and economic stalemate directly or indirectly caused by Japan.
A few notes: Contrary to common Chinese and Western misconceptions, China’s average GDP growth rate was no less during 1949-1970s than from 1970s to present (even there were temporary setbacks caused by policy mistakes during 1958-1962, “great leap forward movement”). During the Cultural Revolution, China’s growth averaged 10+ % per year. I am not saying Cultural Revolution was good to Chinese (quite the contrary). I am just stating a fact. Did the Chinese annual statistics exaggerate China’s GDP growth? Indeed, the Chinese government makes up numbers from time to time (same way as the Western historians who made up China’s history during years they were allied with Japan against red China). However, it is mathematically impossible to consistently overstate China’s GDP growth rates for so many years. If it overstates the growth rate by a couple of percentage a year for 50+ years (since 1949), then the official GDP figure in 2004 would be several times bigger than the actual GDP (simple arithmetic). Quite the contrary, some Western economists believe that the official Chinese GDP figures in recent years understated the true size of the Chinese economy. So, in average, China did not overstate its growth rate. It may have in fact understated its growth, but the average size of understatement is not big, for the same mathematical reason.
On Japan’s ODA (official development aid) to China
Total cumulative Japanese ODA to China (from its inception in 1979 to the end of 2004) were 3333.5 billion Japanese yen, 3133.1 billion of which are long-term government loans in yen. That is equivalent of $30.9 billion using the exchange rate of May 27th, 2005, “107.88 yen = 1 US dollar” (in fact, Japanese yen has appreciated since 1979, making it more valuable today in dollar terms than in most years of the past). By comparison, China’s foreign reserve at the end of 2004 was $609.9 billion.
Japan basically has made $0.95 ODA ($0.89 in loan and $0.06 in gift) to each Chinese (1.3 billion total) in an average year since 1979, even if we use today’s exchange rate. Japan’s ODA on one hand was helpful to China and China is grateful for it; on the other hand, it was helpful to make Japanese goods enter China (but Japanese do not mention such benefit at all). Although China is grateful for any helps, big or small, it is such a shame for the Japanese prime minister to say that China “graduated” from Japanese aid.
Japanese ODA loan to China in year 2004 was already reduced to $796 million (85.9 billion yen). By the way, China now is offering billions (US dollars) of low cost government loans to SE Asian countries. Did Chinese press insist that the SE countries should be grateful to China for the ODA? The truth is that, most Chinese are even unaware of these Chinese loans to SE Asia. After all, such ODA is common in international commerce, and it serves the interest of both parties. Not to mention that such ODA is only an unsubstantial part of the commerce.
Elected Japanese officials and Japanese press talk as if China’s fast growth was not possible without Japan’s ODA, and thus intentionally mislead the public (this is proven by the misconceptions shown by a handful of Americans on many message boards). They also confuse it with war reparations. They intentionally make the Chinese look ungrateful.
Monday, May 30, 2005
The Hallucinating Powers of Opium and Enlightenment
About 180 years ago, the immense trade between China and the British was running into problems.
The huge British appetite for Chinese tea, porcelain etc. was not matched by the Chinese who had little need for British goods (the Industrial Revolution had not yet started so there was no ‘great’ entrepreneurial skills for some present day Asians to ‘fall heads over’).
As a result, the 'greatest empire' of the time found its silver and gold flowing one way, and decided to reverse that flow. They found it in opium, a British 'discovery' from Afghanistan and India after they whacked the Portugese and the Moghul Empire to create what they proudly called the ‘jewel of the British crown’ (just one sign that the immense returns from colonization was getting to their head).
At that time, this super-power of the time (for whose empire the sun never sets) found nothing wrong with selling opium, and sought to perpetuate that through the Opium Wars (their banning of its sale in Britain and ‘passionate appeals’ by certain British politicians claiming that ‘the war was unjust’ notwithstanding).
Even Adam Smith, the Scottish writer of The Wealth of Nations, supported the opium trade and the British for it 'expands free trade'. Perhaps this was the 'unseen hand' he had been talking about - what other better way is there to make money?
After the Opium Wars ended in mid-1800s, the Chinese were made (or rather whacked) to accept continued opium trade in the name of 'free trade', reparations of 50 million ounzes of silver, and concessions for Kowloon and the Hong Kong island which the British used as ‘safe haven’ for their opium supplies.
Before the wars, the Chinese had applied a ban on British trade because the latter refused to stop the opium trade. As a result, the British ‘exported tea with the help of the US’ (known commonly to some present day fools as ‘the most benevolent superpower in history’). During the wars, when the British armada was attacking various coastal towns, the Americans went along as a sort of ‘deputy sheriff’ (a role not unlike what Mahathir used to describe present-day Australia). One American naval commander was reported to have cried ‘blood is thicker than water’ in one of those attacks (blood thirsty frenzy aside, that is also more than a sign of Anglo-Saxon bravado).
Today, the Afghans doing the same represents ‘an enormous threat to world stability’, says the ‘nice’ Americans. Or perhaps the Americans are looking for a reason to whack those Afghans some more (see attached report).
At about the same time as the Opium Wars, a bunch of Chinamen plotting to change a weak China by ‘learning from the west’ was drawing inspiration from some certain ‘commandments’. Claiming variously to be the ‘brother' of some godly fella, and speaking for some 'holy ghost’ et cetera, they were leading a revolution known as the Taiping Revolution.
Of course, these Chinamen were not the first, nor the last in the world to make such claims. A certain Mohammed, for instance, did something similar and his followers had since been competing with the other fella’s in a ‘my god’s such and such is better than to your god’s such and such’ fight to be 'most god-right' till today as exemplified by my favorite global-idiot, George Bush Jr and his nemesis, Osama.
But and probably ‘surprisingly’ to those that believe in the powers of those books, the British found this set of ‘enlightened’ Chinamen a nuisance, and dispatched its own ‘Ever Victorious Army’ (assisted again by who else, the Americans) to help the Qing government whack them. Apparently, the British preferred a backward China than an enlightened one (always easier to ‘screw’ a greater idiot, perhaps). This army was also recorded to have brought home to London ‘incalculable quantities of loot'. 30 million Chinamen perished in this revolution, a feat to be matched by the Japanese some 50 years later.
Although the British were 'really' peace-loving people that would have preferred others to submit to their nice colonial rule like what the Indians did (reason why India was such a 'jewel'), other means was brought to bear on those less willing to 'toe the line'.
'Learning' from the 'great' British and Americans, other ‘great powers’ realized (faster than many present day histo-ignoramuses) that the strategy of war and loot/reparations was so rewarding that a couple of decades later, a bigger group came together to do the same thing on the back of the Boxer Rebellion.
So, can you see how useful intoxicated and ‘enlightened Chinamen’ can be? In fact, this strategy, no doubt honed from similar ones by the Spaniards, Portugese, and ‘Americans’ in the New World, was so lucrative (who needs hard work?) that it soon inspired the ‘rush for Africa the last continent’ exemplified by our King Leopold II, and, of course, the equally smart Germans and Japanese.
During the Boxer Rebellion, a total of eight nations (Prussia and Japan included) joined in the 'Chinese feast'. In addition to being looted, China had to pay reparations of 500 million ounzes of silver (more countries to feed so bigger amount). This amount represents more than 1 ounze per Chinaman, enlightened and not. Or about 10 years of Chinese government revenue.
After that, Japan separately decided to fatten itself by attacking north China and Korea, and got another 250 million ounzes of silver from China for themselves. Along the way, they whacked the Russians and thereby inflated their egos which led to their famous 'free all Asians by replacing the European colonists with themselves as master of Asia' ambition.
With so much easy money from China, India, Africa etc., these powers went over each other and we had WWI.
The victors of WWI led by the British and Americans tried to do the same 'war reparations trick' on the Germans in a form of 'globalization of reparation revenue', and created 'new jewels' in their crown by carving for themselves all the oil rich territories that belonged to the Ottomans (by then the value of oil known to exist abundantly in the 'near east' for hundreds of years was well apparent). At the same time, they created the new state of Israel to 'fulfill the vision' of their book, and a god-perfect setting for perpetual conflict between the other 2 sets of 'idiots of the book' which served their purposes well to today.
Along the way, they also under-estimated and over-ignored the Japanese who was left feeling short changed because they did not get their 'fair share' of Prussia's Chinese possessions. Thus setting the scene for WWII.
Today, if you swap the British and the Americans around, change opium for a few other commodities, and swap a few place names with the ones above, you can about see the same things happening around us (including recent stories of a certain son of a Thatcher). Of course, one should not leave out the ‘faithful’ Australians that had been living off the spoils of these bigger fellas all the while in their little pirates’ lair down south.
If you are a Chinaman like me, the above may give you reasons to despise your forefathers, and look down on their practices and systems.
Many entranced by the wealth of those 'powers' had obviously wished to reproduce the same for themselves. Some who fail to do so via commonly accepted ways of hard work etc. and do not know the 'value' of the strategies outlined above (can't see the 'unseen hand'), may give in to desperation, and adopt the other's beliefs in a 'monkey see monkey do' act of desperate delusion in the hope that it will somehow get them there (the cost of being second or third class citizens notwithstanding – topic for another day).
But then again, as the Taiping fellas learnt, blind faith does not help, no matter what high deity you claim you represent.
p.s. Mark Twain said that "when one reads the book, one is less impressed with what the deity knows than what he does not". But then, that writer from so many years ago, what does he know? Which writer??
Thursday, April 28, 2005
Why Our Hearts Beat Differently
{Original Letter}
Why Our Hearts Beat Differently
I refer to article “Why my heart does not beat for China” published on 27 April 2005. The writer was right in saying that people should not react to any event from the standpoint of their ethnicity. He should perhaps also have stated that people should also not do so from the standpoint of nationality (which is a relatively new concept from a historical context) but should perhaps do so from that of human decency. From this standpoint, we should perhaps try and make sense of the following observations from the writer:
1. ‘the vehement protests seem limited to China and Korea’
2. ‘that expressions of nationalist feelings in China do not strike a chord with Chinese Singaporeans’
To understand item 1, we should firstly start by recognizing that China and Korea are the Asian nations that suffered the most under Japan (far greater than the others by any measure).
Secondly, we should try to better understand the history and considerations behind the treaty of surrender of Japan. Geo-politics is a keyword here. (http://guywong.home.netcom.com/html/IvyRecon.htm).
Thirdly, we should find out more about the Yasukuni shrine which also ‘houses’ the graves of WWII Japanese war criminals, and what the ‘temple’ represents. The following could have been mistaken as a ‘mission statement’ in another context but was extracted from this encyclopedia (http://en.wikipedia.org/wiki/Yasukuni_Shrine):
A pamphlet published by the shrine says "War is a really tragic thing to happen, but it was necessary in order for us to protect the independence of Japan and to prosper together with Asian neighbors." In others, the shrine runs a museum on the history of Japan, commemorating the soldiers who fought for Japan, remembering them as Kami (gods),and the English website claims that "Japan’s dream of building a Great East Asia was necessitated by history and it was sought after by the countries of Asia."
Item 2 can perhaps be explained by asking the following questions:
- how many Singaporeans are aware of the above?
- when do Singaporeans ever feel strongly about anything? (may be with the exception of making money)
It is also not uncommon for less informed humans who tend to be selfish to behave in a manner that basically says ‘if it does not affect me, it does not bother me’. To put this in reverse perspective, as far as I know the water issue with Malaysia and that of the IRs ‘strongly felt’ by Singaporeans also did not strike a chord with the people in China and Korea. That does not say anything about how far China or Korea has come as nations.
{Version published by Today}
Editor comments: IT'S a sign of how far we have come as a nation, that expressions of nationalist feelings in China don't resonate with Chinese Singaporeans, said Siew Kum Hong in yesterday's News Comment, "Why my heart does not beat for China". Readers give a wide range of reactions.
"If it does not affect me, it does not bother me"
THE writer was right in saying that people should not react to any event from the standpoint of their ethnicity. He should perhaps also have stated that people should not do so from the standpoint of nationality, but perhaps from that of human decency.
The writer observed that the vehement protests seem limited to China and Korea and that the expressions of nationalist feelings in China did not strike a chord with Chinese Singaporeans.
First, note that China and Korea are the two Asian nations that suffered the most under Japan.
Second, how many Singaporeans are aware of this? And when do Singaporeans ever feel strongly about anything (maybe with the exception of money)?
It is not uncommon for less informed humans who tend to be selfish to behave in a manner that basically says: "If it does not affect me, it does not bother me."
To put this in reverse perspective, as far as I know, the water issue with Malaysia and that of the IRs "strongly felt" by Singaporeans also did not strike a chord with the people in China and Korea. That does not say anything about how far China or Korea have come as nations.
{'Feedback' I sent to Today on the publication}
Hi,
I understand the need to be succinct but your published version of my letter had key references I made left out thereby making its contents appear shallow and in the process proved the one key point I was making - the lack of in-depth knowledge of world/historical events is the reason why Singaporeans do not feel strongly about anything. Similar behavior on the part of the providers of their daily dosage of 'news' does not help.
Thursday, April 21, 2005
Let's Join the Club
http://www.nationalcatholicreporter.org/todaystake/tt050503.htm1
(copy provided below)
If a macro example is too much for some to contemplate, a more micro one is attached for convenience ("Why Maids Are Not Allowed in Cricket Club") :
http://cckplanetblog.blogspot.com/2000_10_01_cckplanetblog_archive.html
So which and whose club are you in? Why did they let you in? In what way does it make you or them feel good?
By the way, the mighty British (some say great) once famously posted signs at a Shanghai park that said 'No Dogs or Chinese Allowed' (presumably it was grounds for one of their clubs).
That was after the Opium War gave them Hong Kong, MFN status, extra-terrestrial legal rights for British, the right to sell more opium to Chinamen, and China agreed not to call them barbarians anymore. The other powers quickly got the same soon after (may be out of admiration or respect for greatness of the British).
p.s. today got half-day off lah. Going to setup a teh tarik club tonite at Bedok Road with Benny Chin. Anyone care to join? Entrance fee only 70 cents - no need to sell anything for that.
History Lessons for Pax Americana
by Arthur Jones, NCR editor at large
Current political buzz equates President Bush's globalization with the dawn of Pax Americana. Doonesbury has already given Dubbya a centurion's helmet.
This fits nicely with the rehabilitation of Pax Britannica, (see Niall Ferguson's slightly fawning "Empire: Queen Victoria's Secret" (Basic Books) enamoured of pro-British Indians and other former serfs, and Ferguson's own nostalgia for English free trade and military and capitalist domination.
Edward Gibbon held the same views of heyday Rome. His "Decline and Fall of the Roman Empire", opens as Pax Romana, those two centuries of peace from the reign of Augustus (beginning in 31 BC) to around 180 A.D. Pax Britannica had a shorter run. Arguably from 1865 to the Japanese destruction of the Russian fleet in 1904-05.
Gibbon: "In the second century of the Christian era the empire of Rome comprehended the fairest part of the earth and the most civilized portion of mankind. … Their peaceful inhabitants enjoyed and abused the advantages of wealth and luxury. The image of a free constitution was preserved with decent reverence." Free constitution for Romans, but Rome's holdings were "provinces," not free states.
Pax Romana and Pax Britannica contain parallels and warnings for a United States that aims at Empire, with Bush a latter-day Queen Victoria.
The Roman Empire was an economic domination - there was no enemy worthy of the name. The British Empire was the same: in "India Britannica" (1983) Godfrey Moorhouse reminds that England's major rush to augment its India presence came because the supply of raw cotton to England's cotton mills was cut off by the American Civil War. For Britain, "King Cotton" was the oil of its day.
Empire created the mess that is today's colonial-era divided Africa, and military-coup-prone Fiji, where the British imported Indians -- who today nearly outnumber native Fijians. Empire is the Amritsar massacre, plus everything Gandhi opposed. That's the underbelly of Pax Britannica, just as condoning torture is the underbelly of the new Pax Americana.
Rome wanted an Empire of Roman citizens. And those who became such were well satisfied. The English operated differently. The first thing they did in a new colony was found a club and a race course and exclude the locals. The English wanted to be envied. Those locals admitted under sufferance to further the iron grip were well satisfied to be included.
The Americans want to be loved. Let's see how that plays with the Iraqis, the Arabs and Muslims.
Arthur's Daily Ditty
Pax Americana: Bush locuta est
Carpe diem, seize the dime,
Tempus fugit, fuggedabout the Times,
O quo vadis? Osama who?
Caveat emptor, caves' empty, too.
Pater Nosterv, thank you, Dad,
Iraq's oil's ours, pax, your lad.
(PS, Postscriptum:
Our motto's certain:
E pluribus unum et Halliburton.)
Wednesday, April 20, 2005
Date to Respect
http://www.snapnetwork.org/news/otherstates/ri_filmmaker_holywatergate.htm
(see previous blog entry and extracts of above links in comments)
Let us note this date
To some a sacred mandate
New head a divine dictate
Enlightened ones celebrate
Fools like me contemplate
How come a noble state
Despite all that ingratiate
Low its guardians degenerate
Harbingers of great faith
Prone to such mistake.
Those who dissect
Do not demand respect
Nor only what delect
Otherwise reject
But take in perspect
Like why those young so perfect
Abused by nearer God prefect?
They say man is imperfect
Let’s forgive and forget
Great generosity of neglect
Not likely so if the same theirs beget.
Such detestable palate
Even me who seem inanimate
and soul-less would not imitate
Haunts me inordinate
Excuses used to placate
Reasons indeterminate
No insult intended mate
Just cannot appreciate
Won’t submit to such fate
Or those quotes you gyrate.
Greatest gift Nature bequeathed
That of the intellect
Should make us all suspect
That such man-made sect
Are also used by insects
But somehow I don’t expect
Some to come clean with circumspect
To all Gods I willingly subject
But cannot put this with respect…..(CCK 05:4:20)
(CCK 05:4:20 - Nice numerals & ditty to quote, divinity it does not denote)
Monday, April 18, 2005
Pope Trivia
I then received 'feedback' from one of the more 'sensitive' ones (exchange at bottom) whose past exchanges with me had been quite 'amazing' to say the least e.g.
http://cckplanetblog.blogspot.com/2001_06_01_cckplanetblog_archive.html
See also comments for subsequent private exchange and see how such people can completely miss the point (in that case, my friend was trying to 'prove me wrong' by saying there was possibly one black Pope from Ethiopia, when I was trying to show something else i.e. it is just another man-made institution exhibiting all the common traits of one).
The other thing was our friend did not bother to check his facts again - I could not find record of a black Pope for the Roman Catholic Church. Again, I had to remind our friend that I was talking about that particular Catholic church, and he should not mix it up with others. (Phew! You see what I mean?)
Trivia Questions:
1. Why is the institution headed by the Pope known as the Roman Catholic Church?
2. How is the Pope selected?
3. How many Popes are there at any one time?
4. How many Popes were white?
5. Who are the Jesuits and why were they once disbanded soon after formation?
6. Is the Pope a celibate?
7. How many Asian Cardinals are there and who decides on that?
8. How long does it take the Vatican to declare that Galileo and Darwin were right and which Pope was behind it?
9. How old is the state of Vatican City?
Trivial Answers:
1. Why is the institution headed by the Pope known as the Roman Catholic Church?
This institution owes its existence to the Romans who were the ‘greatest and most benevolent’ super-power of their time (hey, if not how else would we have known such a great ‘book’). The most prominent players were a Roman emperor called Constantine, and a goyok seller by the name of Paul.
2. How is the Pope selected?
Over time, the Pope was selected in a number of different ways (no one formula is prescribed by the ‘book’ what). If you think that is a sign of Vatican dynamism, read on.
As democracy was not mentioned in the great ‘book’, that was not the selection approach for a long time – may be, this ‘greatest thing’ the world had ever discovered was not known to the Romans (never mind the Greeks were just next door).
So it was left to the heavens to reveal its choice to the world in its ‘own mysterious ways’. But this is a free world to which each enlightened ones read their own unique holy signs. But mostly, all those signs are so holey that the only one method that holds water was the one based on who holds the most swords or guns. And so it was that when the Romans were masters, influential Roman families will ‘compete to put their guy up for the job’ (if it sounds like the Republicans and Democrats, you are not wrong). If you are as powerful as the likes of Napoleon, you can afford to march all the way to Rome and install one of yours (if that sounds like present day Iraq, you are also not incorrect).
If you are desperate but not powerful enough to subdue the other guy trying to do the same, you can always have your own pope. In fact, once there were 4 of these fellas at the same time (installed by 4 different fellas, of course). Can you imagine that? The world having 4-times the holiness – you can’t get enough of those blessings, I tell you!
If you think that lacked class, you can always setup your own church like what the English did. In fact, you can as well re-write the bloody book to suit your needs, like what the English did. (“Who say cannot? Whack you, you know” was how the English got their new church and new set of books)
3. How many Popes are there at any one time?
As many as you like if you dare, or one which is his who is powerful (see 2).
4. How many Popes were white?
All. What do you expect? Go read answers to 1 and 2.
5. Who are the Jesuits and why were they once disbanded soon after formation?
As the Vatican was losing its influence in ‘old Europe’ about 400 years ago (and too many people telling them what to do), the Jesuits were formed by the Vatican to spread its teachings to the newly colonized parts of the world (they called it the ‘new world’). To do that the Jesuits had to firstly include the non-Europeans into the ranks of humans or gentiles in their lingo (how to sell goyok if the new skin cannot stick?) But that position was totally opposite to that of the Spanish and Portugese (the ‘super colonialists’ then) whose justification for widespread extermination of the ‘natives’ was because those ‘natives’ were sub-humans. So those powers pressured the Vatican to disband this group of nuisance and the Pope gave in. (This should be illuminating for pop-era clowns that think the ‘book’ has great positive effects on humans)
6. Is the Pope a celibate?
Depending on the situation: the Pope can be celibate or not (where the ‘book’ said he must be one or the other?) So it depends on how much earthly power the Pope has at that point in time. In medieval times, when they enjoyed relatively greater influence, they were not (hey, who dare ask such questions when the fella is all powerful?) So, we had cases like that of one Pope that had a few illegitimate kids and arranged to have them married to influential Roman families in a sort of ‘gene laundering’. In fact, it was all just about power, money and sex (see also 1, 2 and 3). In fact, some of these fellas would make Clinton look like a saint!
7. How many Asian Cardinals are there and who decides on that?
Depends on when you are talking about. None in Roman times. Either Chinamen were not considered humans (only their later day descendants are so), or they did not exist. Whatever the case, Chinaman cardinals are nowadays appointed by some council controlled by some mainly white men (who are they and who decides they are what they are? You mean you dare to ask? Whack you, you know. OK, let’s be more civilized. Go read 2 above again and go back to your corner.)
Today there are 10 Asians among the 115 cardinals. If this sounds like the ratio of Asian jurists in the war crimes tribunal for Japan’s WWII crimes, it is not a coincidence. Bit players in somebody else’s show.
8. How long does it take the Vatican to declare Galileo & Darwin were right and which Pope was behind it?
The last Pope John Paul II was the one who ‘set the record straight’ by declaring that Galileo was right after all and that the Earth does go round the sun. So the result of 1633’s Roman Inquisition on Galileo was overturned and Galileo was found ‘not guilty’ in 1992 (don’t know what happened lah. May be Galileo was intially crowded out by the others in the Mecca-like frenzies 'to be with Him' but finally got his audience with the Gods and they agreed with him. The Gods then SMS the obviously slower Popes who only got the message after the advent of the handphone. Thank you Motorola, Amen).
John Paul II was also the one who in 1996 said that Darwin’s theory of evolution (published in 1871) was ‘more than a hypothesis’ (hah, this time Darwin took his turn with the Gods much faster than his less fortunate predecessor. May be the Gods figured out the need of a ‘fast lane’ for the ones with brains. Too bad, the other retards dying ‘to be with the Lord’ will just have to wait a little longer).
Please don’t ask how come the Gods don’t just give those damn theories to the Popes (or the popey ones) and let them have the glory and save them all the embarrassments. Hey, the Popes have more important things to do (see 2, 5 & 6) and the Gods work in mysterious ways, okay?
8. How old is the state of Vatican City?
You go find out yourself lah. Everything also must tell you meh?
{Exchange with 'sensitive' one}
Hi CCK,
Once again we are very saddened to receive such an email from you as it is very disrespectful of the Church and in addition showing disrespect to us (Catholics) who we thought you had considered as your friends since we are on your mailing list. I think one should refrain from criticising any religion for that matter. You may find fault with any religion because humans have been appointed by God to bring the faith to other humans and because humans are prone to making mistakes, there will be the inevitable faults. This should nevertheless not detract from the fact that there is a God who created all of us and hence we should show reverence and respect to our creator.
Because of this, I am asking all those who are on your mailing list to pray for a conversion of your heart. Jesus said that we should forgive those who insult us and so we are praying for you the same prayer that Jesus prayed for those who tortured him and nailed him to the cross....Father, forgive them for they know not what they do.....(Luke 23:34)
Also, pls remove us from your mailing list to save us from further insults.
God Bless You
LP
Hi Liang Perng,
I am sorry you took the writing as an insult. It was not meant to be personal. Since that was the way you took it, pls do accept my apology (I still want to be your friend).
I recognise that the way the historical facts were presented was a bit crude but it was nevertheless intended to be light-hearted. I recognise that although it highlighted the fallacies of one man-made institution, the same apply to all man-made institutions of power. We should therefore exercise as much degree of wariness as respect.
The choice of this topic was merely a result of circumstances and had to do with the current publicity around this topic which I felt some people took incorrectly as having universal interest, applicability and truth (pls refer to my original introduction).
I have since re-drafted the historical findings below, and hope you find them more acceptable and enlightening.
Thanks for all your kind wishes too. Following your advice, I will try to be inclusive out of respect for the others: So may the Lord Krishna, Allah, Buddha, Mishtra, Et Cetera Et Cetera Bless Ya (just too many Gods to call upon lah)
Da Da.
CCK
1. Why is the institution headed by the Pope known as the Roman Catholic Church?
This institution owes its existence to the Romans who were the super-power of their time. The most prominent players were a Roman emperor called Constantine, and a great influencer by the name of Paul.
2. How is the Pope selected?
Over time, the Pope was selected in a number of different ways but democracy was not the common approach. But generally, who got to be the Pope was determined by who ruled Rome or Europe. At times when there existed more than one competing powers, there existed multiple candidates co-existing at the same time under the patronage of their own political rulers. Once there were 4 Popes at the same time. Hey, you can imagine how exciting those times can get.
History also recorded that the more powerful rulers like Napoleon always want to have their own candidates installed as Pope - if all else fail, they would do so by sending their armies into Rome.
It may be worthwhile to also note that it was recorded in history that once England decided to setup its own Church when it could not get the Vatican to agree to some of its wishes. It also re-drafted the Bible for the same purpose. It was likely that no one dared do anything about it because England was quite powerful then.
3. How many Popes are there at any one time?
It varies depending on the political situation of the time (see 2).
4. How many Popes were white?
Some Europeans have darker skin than others – so they are not all fully white. But they were all Europeans nevertheless. This is understandable because the Church is a European institution.
5. Who are the Jesuits and why were they once disbanded soon after formation?
As their influence waned for various reasons about 400 years ago, the Jesuits were formed by the Vatican to spread its teachings to the newly colonized parts of the world (they called it the ‘new world’). To do that the Jesuits had to firstly include non-Europeans into the ranks of humans or gentiles (the reason is because the Bible was meant for 'man'). But that position was totally opposite to that of the Spanish and Portugese (the most powerful nations in Europe then) whose justification for widespread extermination of the ‘natives’ was because those ‘natives’ were sub-humans. So those powers pressured the Vatican to disband this group of nice people who tried to go against the powerful Spanish & Portugese, and the Pope gave in. We can understand why that was the case - any human would have done the same under threat of force.
6. Is the Pope a celibate?
Depending on the prevailing situation: the Pope can be celibate or not (the Bible is silent on this). It depends on how much influence the Pope has at that point in time. In medieval times, when they enjoyed relatively greater influence, they were not. In one case, one Pope reportedly had a few illegitimate kids whom he arranged to have married to influential Roman families. Because the institution was not free from human fallacies, the figures involved in this institution (like all other man-made institutions around the world) are not immune to the usual dynamics of human politics: power, money and sex. And what this particular Pope did was understandable. Likely, he was only trying to strengthen the relationship between the Vatican and the various political forces.
7. How many Asian Cardinals are there and who decides on that?
Depends on when you are talking about. None in Roman times. It is best left to individual conjectures why there were no Chinese Cardinals then. For different fully understandable reasons, many people do not want to discuss that.
Today there are 10 Asians among the 115 cardinals. This ratio is very unrepresentative of the number of Asians in the world. May be this is because Asians traditionally play less important roles in the institution or are considered less able to contribute.
8. How long does it take the Vatican to declare Galileo & Darwin were right and which Pope was behind it?
The last Pope John Paul II was the one who ‘set the record straight’ by declaring that Galileo was right after all and that the Earth does go round the sun. So the result of the 1633 Roman Inquisition on Galileo was overturned and Galileo was found ‘not guilty’ in 1992 (we don’t really know what happened. What we do know is that some one realized it was a mistake a long time after it happened. It happens).
John Paul II was also the one who in 1996 said that Darwin’s theory of evolution (published in 1871) was ‘more than a hypothesis’ (history recorded that this delay was much shorter than the other one. We also do not fully understand why that was the case but it happens. It is just humans).
Some people may ask why incidents like above happened, and why the Vatican did not do more thorough and fair investigations before declaring that these bright people were ‘guilty’. We do not fully know why but suffice to say that all man-made institutions are prone to making mistakes, and, like all nice people, we should just accept them as they are.
8. How old is the state of Vatican City?
I suggest you try to find this out yourself. Having some understanding of the history behind all man-made events or institutions can be helpful in putting things in perspective.
Sunday, April 17, 2005
Why is Japan Demanding Apology for Some Demos?
http://japaneseamnesia.blogspot.com/
Above for those that want to understand why the Chinese and Koreans are still unhappy with Japan's WWII legacy.
It should also be enlightening to those that foolishly parrot after the likes of Times. They claim "the US is the most benevolent great power in history. For example, who else would have allowed the vanquished like Germany and Japan to re-develop into great nations?".
Of course, those that quote above does not know that these nations WERE great powers (that was the reason why they fought in the first place), and were then needed to stand against another great power, Russia.
If you don't believe, go ask the Germans (or Charlemagne)
See 'Short History of the Great Wars': http://cckplanetblog.blogspot.com/2005_04_01_cckplanetblog_archive.html
At the start of WWII when Japan declared war on the British, the latter revoked the Order of the Garter previously conferred to the Japanese god-king Hirohito. Considered as the 'world's highest order of chivalry' it was formed when the British and likes joined together to whack their opposition in what they called the Crusades.
The Americans were so happy with Japan's role in the new order that a few decades later Nixon arranged for Hirohito's award to be restored by the British. Now, you know why the Americans are such nice people?
http://homepage.ntlworld.com/jellytree/seekingjustice.html
Short History of the 'Great Wars'
Since the time of Charlemagne (about 800 AD), the Franks (present day French and Germans) were the lords of Western Europe. They were the ‘heirs’ to the Western Roman Empire (guess who had the East?), and took turns to claim it in the form of the Holy Roman Empire till the 18th century.
That was a long time and not so long ago.
One of the many people ‘super-power’ and Catholic Charlemagne whacked was the then paganish Saxons, and his offer to them upon victory was baptism or death. So the other fella gave in.
Always on the fringe of Europe, the other fella nevertheless remained a constant thorn on the side belly of Europe (the history surrounding the Spanish Armada is a good example). But full reversal of fortunes was only to be played out many centuries later.
At the end of the 19th century, Prussia (present day Germany) was catching up with the Industrial Revolution and fast developing. Together with the US it was considered 2nd only to Britain. Good quality and cheap Prussian goods were beginning to flood the European markets.
Credited largely to Bismark, this period was proudly known to the Germans as the 2nd Reich (the 1st Reich being the Holy Roman Empire - should be obvious but have to be explicit for the less endowed readers).
Prussia attracted and had a huge pool of talented scientific minds from the likes of Planck to Einstein, and consequentially had the most Nobel prize laureates of that period. This long history and technological prowess were the source of Teutonic pride and arrogance (that later showed its worst in Hitler’s ‘Aryan Supremacy’).
It was also the height of the industrial age, and automobiles and the likes raised the importance of oil and the desire to control it. These factors combine to drive Prussia’s desire for a bigger share of the colonial pie, and were cause for concern for the other European powers surrounding it like Britain, France & Russia.
These other powers therefore took concerted effort to limit the growth of Prussian influence and starve Prussia of both raw materials especially oil and market (which the other powers’ colonies amply provided).
See an example of how they piss Prussia off here - http://cckplanetblog.blogspot.com/2004_11_01_cckplanetblog_archive.html.
As the other powers of Europe were for various reasons relatively weaker (the French for example relied on Britain as ‘king maker’ and guarantor of security) the real antagonists at that time were Britain aided by the US (a.k.a. Anglo-Saxons) and Prussia.
So the British got the French and Russians together in a ‘Triple Entente’ against Prussia and Bismark's 'Triple Alliance' which included Austria-Hungary and Italy (Italy as centre of the old Roman Empire should know who the big brothers of Western Europe are).
The US, already harboring ambitions of its own, was not a bystander.
An example of the deliberate attempt to ‘keep the lid’ on Prussia was an exchange in 1910 (years before WW I) between British politician Arthur Balfour and the American ambassador to Britain where the former explicitly suggested that a war with Prussia be started so that their countries’ ‘standard of living’ will not be lowered by the lost of trade (which of course were highest by virtue of the size of the empire they were milking), and to keep their supremacy.
Japan after being insulted by an American fella by the name of Commodore Perry in the mid 19th century, embarked on a modernisation period commonly known as the Meiji Restoration. The insult arose because the Americans wanted a safe base from which they ‘cover’ northeast Asia, and an island off the coast of China was ideal.
By start of the 20th century, Japan considered itself a world power with rights to ‘Asia’ (a name popularized by them for that purpose), and promptly demonstrated that by defeating the Russians and occupying chunks of northeast Asia.
When WWI started, they joined on the side of the ‘Allies’ hoping to get into the good books of the ‘greatest power’ then (Britain and its then deputy sheriff the US). Always safer to bet on the biggest bully! Their weakening of the Russians earlier (which the British appreciated) also helped them gain entry to the ‘club’.
WW I started largely with this back drop, and resulted in about 8 million casualties with Russia, France, Prussia, and Austria-Hungary having more than 1 million casualties each, and the ‘British Empire’ just a tad below 1 million.
The result of this war was the weakening of all powers involved (except the US which officially stayed out till 1917 which was towards the end), and effectively started the beginning of the end of the European powers, and (luckily for many of us) the colonial era.
Towards the later part of WW I, the Balfour Declaration was one of the excuses used by Britain to occupy the Middle East and control the area. That and conflicting agreements with the French and Arabs to gain their support against the Ottoman Empire (fighting on the side of Prussia) were behind some of the biggest problems our world witness today – the Palestinian problem and the politics/wars of Middle East oil exemplified by the occupation of Iraq today.
The Balfour Declaration, openly addressed to Jewish financier Lord Rothschild was intended to draw the support of Jewish financiers around the world in the war against Prussia in exchange for carving a piece of land in Palestine for the creation of a state for the Jewish people. For those with less imagination, the Balfour Declaration is akin to Britain giving an undertaking to Wee Cho Yaw to occupy a piece of China so that the Wee clan in Singapore can return to stay there.
A Rothschild once said “I care not what puppet is placed upon the throne of England to rule the Empire on which the sun never sets. The man that controls Britain’s money supply controls the British Empire, and I control the British money supply”.
Such arrogance and perceived Jewish support of the ‘Allies’ coupled with the fact that Balfour was part Jew were likely reasons for the German’s utter dislike/suspicion of Jews after that (anti-Semitism in Europe was common from before Charlemagne and not likely to be the only reason).
After Prussia surrendered, the Versailles Treaty subjected Prussia to among others punitive war reparations of such unreasonable magnitude and doubtlessly intended to continue to keep the lid on Prussia, that John Maynard Keynes (famous economist whose views present day text-book academics only know selectively) representing the British Treasury in the treaty negotiations, resigned publicly in protest and predicted ominously that it would result in great dissatisfaction on the part of the vanquished (the same observations were made by others).
That plus the Great Depression of the 1930s formed the background for the next and greatest of all wars - WW II.
Hitler and Nazism were as much a result of WW I as cause of WW II. If the use of ‘I’ and ‘II’ is not telling enough, then Hitler’s use of 3rd Reich should.
To make things worse, before starting negotiations for the surrender, Prussia had thought that terms of no annexations and indemnities previously offered by the US as peace brokers would be kept. This is was not to be the case after they surrendered and it is not likely the Germans would have forgotten that till today.
The strategic and geopolitical context of WW II was no different for every key participant – control of markets and source of oil & raw materials critical for further growth and prosperity (Balfour’s so-called maintaining of ‘standard of living’).
This time, Japan joined the Germans. The reason: they were pissed they did not get their fair share of spoils in Asia after WWI.
This time America (with the 'smarter' British this time) again let the others fight it out and exhaust themselves before they joined in as ‘victors’ when the beginning of the end had already begun. For the most part of WW II and to the chagrin of the desperate East Europeans, they used various excuses to remain on the fringes and entered the ‘European theater’ only after the tide had turned on Germany in mid-1944. By then, the brunt of the war and casualties had already been borne by the East Europeans and Germans – about 40 million casualties (the British & Americans suffered less than 1 million casualties in the entire war).
Likewise, Asians were left to their own devices during the Japanese occupation until the atom bomb was deployed – by then more than 10 million Chinese and countless other Asians had died in the hands of Japan which thanks to the ‘bomb’ had close to 2 million casualties.
This approach combined with the resulting exodus of wealth & talent from everywhere to the US safe haven as result of the various conflicts elsewhere over the centuries resulted in the single super power order we have today.
We also see this ‘fomenting of conflict every where else but my own home’ approach in recent times in the Korean peninsula, Taiwan Straits, Middle East, Central Asia and Central Europe.
A reversal of this approach was also cited by Osama bin Ladin as a reason for his Sept 11 attacks - Osama's opinion is that the US should not be left to live comfortably at home while they sow turmoil elsewhere.
At the end of WW II, America and a weakened Britain needed Germany and Japan to stand in between them and Russia.
Unlike what some historical fools think, Russia was the one that won the war in Europe and therefore the new threat to the British & Americans.
For that reason and perhaps realizing the disastrous effects of Versailles that Keynes warned about, Germany got off this time with much smaller war reparation and the Marshall Plan.
Japan had better ‘luck’. It got away without needing to account seriously for its actions nor return stolen wealth and, according to some, for a share of the stolen wealth with the British/Americans.
Perhaps, like the Japanese, the Americans & British thought the other Asians are lesser beings for them to be bothered with that. Which is why Japan (unlike Germany) to this day remains arrogant and refuses to acknowledge its WW II misdeeds including the Nanking massacre where its soldiers raped and murdered an estimated quarter of a million Chinese in a 6 weeks frenzy, in many instances merely for fun or show of bravado as can be seen in photographs.
This ‘indebtedness’ and fear of Russia and the communist threat (real or otherwise), and not to mention their total lack of control of oil (have you heard of a Japanese or German oil company?) resulted in these nations remaining quietly subservient to the US and its interest throughout the ensuing Cold War.
Before the end of WW II, because of his economic insights and perhaps his ominous prediction the last time around (another indication why both wars were essentially one war), Keynes was asked to help draft a new economic world order on the part of the British.
Keynes suggested the setup of a global currency (to be known as Bancor) so that no country can be unfairly advantaged or disadvantaged.
It was an ideal the victorious politicians and their backers understood but would not accept. This resulted in Bretton Woods, and the use of the US Dollar as ‘de facto global reserve’ currency for the last 50 years.
Unlike Keynes, many present day half-baked economists seriously think today’s financial system is a perfect & fair system where all currencies are equally subject to the same rules which they think they understand (until you ask them to explain the likes of the Asian Financial Crisis and ‘irrational exuberance’).
This less than fair system was also the reason for Western Europe’s 40 year effort to create firstly the EU and then the Euro whose global effect we are seeing today.
France and Germany as big brothers of continental Europe since Charlemagme must surely be aware of the above history, and that they were at the short end of the stick for the turmoils of the last century.
The Euro and EU with Germany and France at its core now poses a new challenge to the Anglo-Saxon’s supremacy. We begin to see that recently with their opposition to the attack on Iraq. Bush’s people did not call Germany and France ‘Old Europe’ for no reason – he and his people are well aware of the history of the great wars and the heritage of Charlemagne.
Some quotes to contemplate with respect to the above:
If you will permit us to sacrifice your sons on the European battlegrounds, I promise you that this will be the final war — the war to end all wars — the war to make the world safe for democracy once and for all. – Woodrow Wilson before US joined WWI
I have said this before, but I will say it again and again and again: Your boys are not going to be sent to any foreign wars. – Franklin Roosevelt, campaign speech 1940.
"I have always said that I hoped if Great Britain were beaten in a war we should find a Hitler who would lead us back to our rightful place among nations." – Winston Churchill, letter to the Times
When the tyrant has disposed of foreign enemies by conquest or treaty, and there is nothing more to fear from them, then he is always stirring up some war or other, in order that the people may require a leader. - Plato
CCK note: Plato was not incomplete. Some tyrants stir up wars in other people's home so that the latter will never get to grow peacefully and threaten their dominance.
Tuesday, April 05, 2005
Support Kofi Annan
- the bestial killing and subjugation of others to rob them of their wealth under various pretences as was common throughout history and exemplified by the last 500 years of colonial history. (Try guessing how many Iraqis had been killed by them this time around)
- the refusal to share and fomenting of conflicts among others while supplying/financing arms and keeping themselves a safe distance away with the aim of draining others of their wealth and resources before they can challenge their supremacy as exemplified by the 2 'world wars'.
The utter exhaustion of all the other nations while they remain relatively unscathed is what created the 'single super-power' world order they brag about today and which many present day fools believe is due to the greatness of their democratic or capitalist systems.
We can also witness similar workings today in the Korean peninsula, the Middle East, Taiwan Straits, central Europe and around the world.
As we all know, there is no great power today that can openly challenge their actions in Iraq. The world has few men with the combination of historical/global perspective and moral authority to call upon to bring some semblance of pressure to bear on these supremely greedy, arrogant and armed people.
Kofi Annan is perhaps the only one who can truly speak for the conscience of the entire world by virtue of his elected position as head of the United Nations which was indeed what he did.
For that reason, political machines in the United States are undertaking a concerted effort to discredit Kofi Annan, among others, blaming him for complicity in abusing the UN administered Iraqi Oil-for-Food program.
Aware of this campaign to erode Kofi Annan's moral authority, many nations and important people around the world had openly expressed their support for Kofi Annan.
Recent expressions of such support came from 2,700 UN staff and 70 Nobel Laureates. These people are telling us that the world should stand up for its lone moral voice.
(http://news.bbc.co.uk/2/hi/in_depth/4214401.stm)
So please forward this plea for like-minded people around the world to do the same by sending their e-mails supporting Kofi Annan to the United Nations at pubboard@un.org or add their support to this blog http://supportkofiannan.blogspot.com/
Historical notes:
1. Years before the start of World War I, a British politician by the name of Balfour was recorded to have suggested to an American official that their countries should start a war with Germany before it overtakes their countries for no reason other than 'to maintain their standard of living'!
During WWI, this same man was responsible for the so-called 'Balfour Declaration' that carved a piece of the Ottoman empire, which was fighting on the side of Germany, for the creation of the state of Israel and the plight of the Palestinians today.
2. 50 million lives perished in the 2 World Wars (this is the real holocaust) but Anglo-Saxon casualty was less than 1 million.
3. During World War II, Britain and the US stayed out of the main battlegrounds of Europe through most of the war by which time the Germans and East Europeans had already been exhausted by more than 30 million casualties. Only after that did the American & British 'heroes' went in to pick up the pieces.
4. By the time America 'saved' Asia from Japan on the cheap by way of the atomic bomb, China mostly and other Asian countries had lost well in excess of 10 million lives.
In WWI, Japan fought on the side of the 'Allies' but switched sides in WWII because the 'Allies' refused to give it what it wanted in Asia. So to ensure sufficient reward for Japan for joining its 'Cold War club', America accorded it favourable surrender terms that gave Japan the gall till today to refuse to apologize for any of its actions in Asia including indiscrimate massacres like that in Nanking where in excess of a quarter million Chinese were cold bloodedly slaughtered in 6 weeks. Today, Japan wants to sit in the UN Security Council as permanent member.
Monday, March 14, 2005
A Funny Old World
Don't know this man but is quite sure he is a helluva man.
With him I gladly stand)
It’s a funny old world that we live in
Where its children keep sitting in the dirt
And the flies from the skies
Drink the tears in their eyes
The tears of their hunger and hurt
It’s a funny old world that we live in
When relief sent in thousands of tonnes
Goes in dribbles to those
Near to death’s last repose
And the rest to the men with the guns
It’s a funny old world that we live in
When the most powerful nations by far
Send men to the moon
Yet can’t fill the spoons
That will keep those in need where they are
So, how to resolve the position?
What cure can our leaders all seek?
One thing’s for sure
They’d soon find a cure
If they went without food for a week
Nothing to eat for a fortnight
A cup of stale water a day
If they went without food
Without being rude
They’d bloody well soon find a way
But it’s not only down to our leaders
It’s no use just making a fuss,
Their hands they may wring
But they won’t do a thing
Unless they are made to, by us.
— Jack Broom, Enfield, Middlesex, UK
Wednesday, March 09, 2005
All Politics is Local
All politics is local
9 March 2005
I REFER to the article ‘What Bush Got Right’ By Fareed Zakaria (KT, March 7). The writer may be right in saying that ‘All politics is local’ and it is the same for whichever part of the world we talk about. He, however, went on to attribute the exact opposite about the US and George Bush who he claims is out to do the entire world a favour with his various acts, thereby implying that Americans are a totally different set of people from the rest of the world, and whose interest is somehow above the ‘locals’.
The writer should perhaps apply the same rule he believes in for the US too. Perhaps, the various US actions around the world are really ‘local politics’ at play. In the case of Iraq, the US action was more to satisfy their local thirst for oil and local desire to control its supply and to line the wallets of their ‘local’ oil and arms companies.
Perhaps, we should be careful of people who apply one rule for some people, and another for others.
Or perhaps the fact that the writer is paid by a US company did make a difference.
Along the lines he quoted, ‘All writings are local’ too. In Fareed Zakaria’s case, he was perhaps writing to please his ‘local’ employers.
We fail our own ‘locals’ if we do not highlight the flaws in such selective ‘We are holier than thou’ opinions.
— CCK, Singapore
http://www.khaleejtimes.com/DisplayArticle.asp?xfile=data/opinion/2005/March/opinion_March16.xml§ion=opinion&col=
What Bush got right
BY FAREED ZAKARIA
7 March 2005
EVENTS in the Middle East over the past few weeks have confirmed the theories of that great scholar of the region, Thomas (Tip) O’Neill. The late speaker of the House’s most memorable aphorism was "All politics is local." It’s true even of the politics of rage. As long-repressed societies in the Middle East open up, we are discovering that their core concerns are not global but local.
Most ordinary Arabs, it turns out, are not consumed by grand theories about the clash between Islam and the West, or the imperialism of American culture, or even the Palestinian cause. When you let the Lebanese speak, they want to talk about Syria’s occupation of their country. When Iraqis got a chance to congregate, they voted for a government, not an insurgency. When a majority of Palestinians were heard from, they endorsed not holy terror to throw Israel into the sea, but practical diplomacy to get a state.
Tomorrow, were the Egyptian Street to voice its views — I mean the real Egyptian Street, not President Mubarak’s state-controlled media — we would probably discover that its deepest discontent is directed not at the president of the United States, but at the president of Egypt. Perhaps Arabs and Muslims are not some strange species after all. It is their rulers who are strange.
The other noted political scientist who has been vindicated in recent weeks is George W. Bush. Across New York, Los Angeles and Chicago — and probably Europe and Asia as well — people are nervously asking themselves a question: "Could he possibly have been right?" The short answer is yes. Whether or not Bush deserves credit for everything that is happening in the Middle East, he has been fundamentally right about some big things.
Bush never accepted the view that Muslim extremism had its roots in religion or culture or the Arab-Israeli conflict. Instead he veered toward the analysis that the region was breeding terror because it had developed deep dysfunctions caused by decades of repression and an almost total lack of political, economic and social modernisation. The Arab world, in this analysis, was almost unique in that over the past three decades it had become increasingly un-free, even as the rest of the world was opening up. His solution, therefore, was to push for reform in these lands.
The theory did not originate with Bush’s administration. Others had made this case: scholars like Bernard Lewis and Fouad Ajami, Thomas Friedman of The New York Times, the Arab intellectuals who wrote the United Nations’ now famous Arab Human Development Report and even this writer. (Three weeks after 9/11 I wrote an essay titled "Why Do They Hate Us?" that made this case.) These ideas were gaining some ground in the Arab world, especially after 9/11. But Bush’s adoption of them was absolutely crucial because he had the power to pressure the region’s regimes. Efforts to change the dynamics of the Middle East had always collapsed in the past as its wily rulers would delay, obstruct and obfuscate. Bush has pushed them with persistence and, increasingly, he is trying to build a broader international effort. The results might surprise.
Repressive regimes are often extremely fragile. Syria is the perfect example. Bashar al-Assad’s rule rests on the narrowest base of fear and coercion. His ruling clique, mostly coming from the country’s small Alawite sect, is well aware that it lacks support in their society. That’s why it is so easily rattled and why the events in Lebanon could snowball into something much, much bigger. The other Arab regimes are less fragile. Mubarak, while unpopular, is not despised. The Saudi royal family is more stable than many think. It uses money, marriage and connections-and yet more money-to create an elaborate patronage network that sustains it. But everywhere, there is pressure to change.
The Middle East would do well with incremental but persistent reform, as is taking place in Jordan, Qatar and Dubai. But in too many places, small, gradual reforms have been a smoke screen for doing nothing. Economic reforms are the most crucial because they modernise the whole society. But they are also the most difficult because they threaten the power and wealth of the oligarchies that run these countries. So far there has been more talk than action on this front.
People have often wished that the president had travelled more over the years. But Bush’s capacity to imagine a different Middle East may actually be related to his relative ignorance of the region. Had he travelled to the Middle East and seen its many dysfunctions, he might have been disheartened. Freed from looking at the day-to-day realities, Bush maintained a vision of what the region could look like.
But therein lies the danger. It is easier to imagine liberal democracy than to achieve it. Ronald Reagan imagined a Soviet Union that was politically and economically free. Twenty years later, except for the Baltic states, not one country of the former Soviet Union has achieved that. There have been more than 50 elections in Africa in the past 15 years-some as moving as those in Iraq, had we bothered to notice them-but only a few of those countries can be described as free. Haiti has had elections and American intervention, and still has foreign troops stationed there. Yet only a few of these elections have led to successful and free societies.
Every country, culture and people yearns for freedom. But building real, sustainable democracy with rights and protections is complex. In Lebanon, for example, the absence of Syria will not mean the presence of a stable democracy. It was the collapse of Lebanon’s internal political order that triggered the Syrian intervention in 1976. That problem will have to be solved, even after Syrian forces go home. In Iraq, the end of the old order has produced growing tendencies toward separatism and intolerance. Building democracy takes patience, deep and specific knowledge and, most important, the ability to partner with the locals.
If Bush is to be credited for the benefits of his policies, he must also take responsibility for their costs. Over the past three years, his administration has racked up enormous costs, many of which could easily have been lowered or avoided altogether. The pointless snubbing of allies, the brusque manner in which it went to war in Iraq, the undermanned occupation and the stubborn insistence (until last summer) on pursuing policies that were fuelling both an insurgency and anti-Americanism in Iraq-all have taken their toll in thousands of American and Iraqi lives and almost $300 billion.
Perhaps an even more lasting cost is the broad and deep shifts in public opinion against America around the world. Look at countries as disparate as Britain, Poland, Turkey and Japan, all allies of the United States. In every one of them, public views have changed significantly in the past few years, and being pro-American is now a political liability. Tony Blair, once the most popular British leader in decades, has fallen far in public esteem, largely because of his unflinching support for the Bush administration.
For most countries, the debate over Iraq was not really about Iraq. It was about how America would wield its enormous global power. And to many countries, it seemed that the Bush administration was doing it irresponsibly. On this front, the signs from Bush’s second term are heartening. In the Middle East, however, everything will depend on success on the ground. If, five years from now, Iraq, Afghanistan and perhaps an independent Palestine and a democratic Lebanon are thriving countries with modern political and economic systems, America will be honoured and respected-and the talk of anti-American terror will have dissipated considerably. If, on the other hand, these countries are chaotic and troubled-more like Central Asia than Central Europe-people there will blame America. Remember, all politics is local.
Fareed Zakaria is the Editor of Newsweek International ©2005 Newsweek, Inc.
Thursday, February 03, 2005
Petition Against Casino in Singapore
But since really mature people don't really gamble (they have better things to do in life, no?), the minister probably imply that Singapore wants to take advantage of the less mature in Singapore and in the region (if not, then how to make money?).
Then imagine getting the majority (which should include the mature ones, by way of the minister's logic) to agree to take advantage of the less mature ones when they should be doing the exact opposite! What would that mean to mature me if I agree? What would that do to a country's soul if its mature people agree?
And if Singaporeans are mature enough to have a casino, wouldn't they be mature enough to manage the other more important aspects of their lives like their own wealth (and not be sucked up by high property prices & CPF) & sort out the liars from the not (without the tight control of the media & political arena)?
Perhaps people like me are not mature enough to figure out such contradictions. In that case, I am totally against anyone (mature or otherwise) agreeing to take advantage of people like me!
Wednesday, January 19, 2005
The Best and the Worst of China
http://www.khaleejtimes.com/DisplayArticle.asp?xfile=data/comment/2005/January/comment_January19.xml§ion=comment
Hi,
I refer to the article "The best and the worst of China" by Mohammed A. R. Galadari published a day after the death of Zhao Ziyang, and the following passage:
“China lived as a totalitarian state under the iron grip of Mao Tse Tung and Deng Xiaoping for decades, to be followed by a period of feverish modernization and industrialization under Jiang Zemin, a process that is being carried forward by Hu Jintao today. Jiang Zemin not only opened up the economy but also introduced a certain amount of liberalism in the political functioning, raising hopes that China is changing for the better in terms of its human rights record.”
This passage implied that China's present day economic growth was started by Jiang Zemin which is totally inaccurate. Of all the key actors you noted above and Zhao Ziyang, present China owes Deng Xiaoping the most. Zhao Ziyang, Jiang Zemin & Hu Jin Tao are nothing but a legacy of Deng and is noted as such by most analysts. In fact, Deng hand picked these men himself.
Credit for China’s opening since the early 80s is commonly attibuted to Deng and this is plain to anyone with an understanding of the history of this man & his country. His faculties had clearly deteriorated by the time of Tiananmen, and he made a not so good decision which he might not have made if he was younger.
But we should also appreciate the considerations that Deng had & the context that he was in.
Noted for his practical skills and sharp mind, Deng went through one of the most challenging periods of his country's 6,000 year old history and was closely involved in it.
In that period of his country’s history, the most important events & decisions had implications of life and death for many hundreds of thousands of Chinese, and the welfare of the bigger group must be foremost on his mind.
Deng was a big picture man whose strategic objective was to develop the country he loved & for which he sacrificed almost his entire life & family (he joined politics when he was a teenager and many of his family members were killed by the Kuomintang).
To Deng, as long as his strategic objective was in line, other issues were subservient to it. To him 50 years is nothing.
To him China was ready to accept the humiliation of being poor and back ward but will strive for the day they made good on his hope.
To him, the fate of a billion fellow citizens was not to be decided by the demands of a few thousand young kids who had not yet done anything for their country.
To him bending to the demands of a few thousand people all the time (or interest groups in western democratic jargon), a country of a billion mouths to feed will not stand.
To him a few thousand sacrifices for the good of the other billion is a small price to pay.
Today, half a billion Chinese enjoy a standard of living none of their forefathers had seen for hundreds of years - something that "free-wheeling democratic" Russia or India are not able to do. It was largely due to Deng Xiaoping.
That was and will always be the context and scale of things that Deng and all Chinese leaders deal with.
That must also be the scale on which they should be judged.
xxx
The best and the worst of China
By Mohammed A. R. Galadari
19 January 2005
DEAR readers, China often evokes mixed feelings. On the positive side, its growth in the past few decades is amazing, while on the negative side, its human rights record is reckoned as being one of the worst. Can development be at the expense of people's rights, is a pertinent question.
That China has no serious intention to change its negative image in respect of freedom and rights is clear from the assertion by Beijing yesterday that it has no regrets over the 1989 crackdown at Tiananmen Square. It was widely seen as one of the worst uncivilized acts by a government in living memory, when hundreds, even thousands, of youths had been crushed to death by rolling tanks on that fateful night on June 3-4. That was the way the government responded to a peaceful campaign for democracy and freedom by students. Ousted party leader, Zaho Ziyang, who died a day ago, had put the blame for the crackdown squarely on Deng Xiaoping, the top leader of the time.
Beijing's position is that it would not change its stand that the 1989 crackdown was correct. "Over the past 15 years since the incident, China's development has proved that this final judgment is correct", is how it explains the logic behind its clearly dictatorial stand. The argument is also that China's focus is more on economic development, and less on political reforms.
I do not ignore the fact that, in recent times, there were some half-hearted attempts to build a new image for China. One was the release of a set of new edicts on religious affairs, saying it would help better protect religious freedom. It gave protection to religious freedom and stressed that no one should be discriminated against for his or her religious beliefs. But, those who looked closely at the new edicts didn't see any serious improvements on the existing regulations. Another move was to grant more freedom to the media, a small step forward from a somewhat non-existent state. It wants the media to open up; but open up to the extent that it exposed business corruption, not political corruption. Who doesn't know political corruption is at the root of all corruptions?
China lived as a totalitarian state under the iron grip of Mao Tse Tung and Deng Xiaoping for decades, to be followed by a period of feverish modernization and industrialization under Jiang Zemin, a process that is being carried forward by Hu Jintao today. Jiang Zemin not only opened up the economy but also introduced a certain amount of liberalism in the political functioning, raising hopes that China is changing for the better in terms of its human rights record. But, change in respect of human rights and freedom is painfully slow, as is evident from the government's ham-handed approach to the Falungong religious sect, or to the large number of cases of capital punishment that are meted out often on not-very-strong grounds.
In Hu's scheme of things, it is "people first". He has placed renewed emphasis on the uplift of rural population who number some 800 million. He has also pledged to rein in corruption, but insists that western-style democracy will be a "dead end" for his country. He is ready to allow elections, but within his own party, and does not envisage a multi-party system.
Dear readers, China is seen as a counter-weight to the United States, for the future. That is the way it is growing; that is the way it is building its economic clout, not to speak of its military muscle. But, it has reached a stage in development — some 300 million people, matching the size of the United States, are middle class there — in which it should sincerely and seriously uphold Hu's own slogan, "People first". It essentially means it must set aside its mechanisms that trample on human rights and individual freedom. China has a great civilizational past. It has to have a great future as well, especially in terms of human freedom and liberty, the ideals of the modern world.