Saturday, September 13, 2008

I came across a very stupid theory 'The Divine Right of Kings'. A brief introduction to its basics:

Divine Right basics.

Definition
  1. In every kingdom, the king's power comes directly from God, to whom the ruler is accountable; power does not come to the king from the people and he is not accountable to them.

  2. In every kingdom, the king makes the final decisions on all aspects of government (including the church). Other people and institutions that exercise political power do so as delegates of the king, and are subordinate to him.

  3. However tyrannically kings act, they are never to be actively resisted. (The doctrine of non-resistance).
    If the king orders an act directly against God's commands, the subject should disobey but must submissively accept any penalty of disobedience. (The doctrine of "passive obedience").
    The doctrine was neatly encapsulated in the satirical song, The Vicar of Bray, which insisted that "Kings are by God appointed, /And damned are they that dare resist, / Or touch the Lord's anointed".

  4. Monarchy is the best form of government, but other forms are valid.

  5. (Some - but far from all - adherents of the Divine Right of Kings also maintained the principle of indefeasible hereditary right: i.e. the belief that while the legitimate heir to the crown is alive it is wrong to swear allegiance to any other ruler, even one actually in possession of power).

Source- http://history.wisc.edu/sommerville/367/367-04.htm

Now, this theory is not as stupid as it looks. The basic contention is good enough- to judge is to be superior. Hence, inferiors cannot judge superiors. Hence, subjects cannot judge kings.

The theory requires a basic theistic framework. If one does not believe in God, the theory is invalid.

Now, as God is the only "superior" for a king, the king is responsible to God only. The only problem is- Why should we accept the king as God's deputy? If we accept the position of God on the caveat that if God did not want the king to rule, than God would have disposed him than there is no reason to develop (cultivate) any feelings of deference, loyalty, and obedience towards kings. If God wants me to have these feelings towards kings, God would develop them. And if I have thoughts to depose the king, there should be no reason to suppress these thoughts. If God didn't want to depose the king, why did God give me such ideas? So this theory has no basis for generating loyalty and support for the king. A straightforward assertion of "might is right" would have been cheaper and less hypocritical.

Friday, August 22, 2008

IPL and capitalism

IPL showcased two problems in capitalism.
  1. Monopoly and lack of competition are facts in some fields of life. Franchises paid huge franchisee fees just to ensure that players will be available to them. The stranglehold of BCCI on players ensured that wannabe owners of teams with international players had 2 options- play huge rent to BCCI or start a completely new league of their own without any links to BCCI and ICC. Even for a completely new league, it is difficult to get players. As the normal source of employment is close, and the sustainability of new venture is doubtful, players would want a huge risk premium in addition to their normal wages. ICL reportedly offered Warne a million plus dollar but even for a retired player, the premium was not enough. To recover the premiums, the number of playing days has to increasse greatly. This increases the overall riskiness of an inherently risky (due to its newness) venture and and adds up the operating expenses.
  2. Ignoring the interests of minority shareholders: In Indian capitalism, promoters own more than 50% of shares. If a company buys a team, the promoter would get publicity but all the shareholders would have to fit the bill. Given the media madness around IPL, the promoters like Mukesh Ambani were assured publicity. The billionaire promoters could easily trade some extra millions for fame. It was the minority shareholder whose money was invested in ventures of doubtful financial viability and who did not become any more famous in the bargain.

Monarchy

Monarchy is perhaps the most enduring form of government. It is also perhaps the one with most variations. I tried to check the Chinese and Russian versions of monarchy. The views are simplifications.

China:
  • The Emperor was absolute ruler. However, the post of Emperor was depersonalized. The Emperor was termed "Son of Heaven". Emperors were selected by agnatic succession. Hence, the relationship was not used biologically but rather son was used in the sense of viceroy. Chinese emperor was not the soverign of a single state but also the head of all states of the world.
  • A meritocratic bureaucracy, was the other pillar of China. However, bureaucracy, if left to itself, would turn into a clique where posts will not be decided on a meritocratic basis but on the basis of heredity and recommendation. the emperor would prevent a clique from arising, as it was in his interests that the country should be run by the best people.
  • The Chinese had another concept 'Mandate of Heaven'. This was tied with emperor's position as viceroy of Heaven. If the emperor was perceived to be acting unrighteously, his Mandate was supposed to go away. This stabilized the system in several ways. If the emperor favored a clique and bypassed the meritocratic bureaucracy, the bureaucrats who occupied the top judicial, executive, and military posts could legally rise in rebellion and claim the emperor's mandate was gone. In ancient China, character, effort and intelligence all constituted merit. Wannabe bureaucrats were tested rigorously for character. Thus if the emperor's policies hurt the common man, the meritocratic bureaucrats could raise the banner of revolt. Hence, the concept of 'Mandate of heaven' protected the meritocratic bureaucracy from the autocratic emperors and ensured within limits the protection of people from rapacious emperors. The meritocratic bureaucracy, in which character was an inherent constituent of merit ensured that vast powers were used for public good.
  • The Mandate had another great use. If a person, disposed the present emperor, than the Mandate validated his rule in the eyes of people and bureaucracy. This allowed 'great man' in the mold of Napoleon, a chance to display their great talents while leaving the bureaucratic apparatus unimpaired.
Hence, the Chinese version balanced all players, formalized the system, made it as meritocratic as possible, and ensured that the talents of great man in the mold of Napoleon were used to inject life into the sytem rather than destabilize it. hence, it survived through many empires for 2000 years.

Russia:
Russia was the largest ( in area and population) of the 3 premier monarchies of Europe: Prussia (Germany), Austria, and Russia. It was also the least democratic and least developed. the country's official policy was: Christianity, Tradition, and Autocracy. Tradition means the way of forefathers. Now, Christianity did not develop in Russia. It came at a particular time in history. Hence, for some people at some time, it was not tradition. So mindless insistence on tradition, violated first tenet. It could be argued that Christianity was preached firstly and foremostly by God himself and hence, it was superior to tradition. Carrying this argument, any non-Christian tradition had to be discarded. Russian insistence on home-grown traditions did not gel with Jerusalem born Christianity. Orthodox Christianity no matter how much Russified it became, was born in Constanipole and ultimately based on teachings of a person from Jerusalem.
Autocracy, was another tradition. It was based on agnatic promigeniture. Now, according to Chritianity, this tradition would be valid, if Romanovs (ruling dynasty of Russia) could trace descent from first son of Adam. They didn't. Hence, the tradition of autocracy was un-Christian. Even if they did, they would have been rulers of whole world and not just Russia. They never claimed the same. More importantly, the Romanovs who insisted on "home-grown" traditions usually married German, not Russian brides.
The first king among Romanovs was elected by boyars (nobles). This was accepted history. Given, that all humans were descendants of Adam and Eve, there was no reason to give voting rights only to nobles. Besides, there was no reason why voting should be a one-off event. One could argue a person, should be chosen for life. If people have choosen wrong once, they may repeat it. Buit that does not restrict chosing new kings after death of old kings. Thus the concept of autocracy was also against Christianity.
Hence, the Russian empire was based only on might. Once, its might was exposed as hollow in the 1905 Russo-Japanese war, collapse was inevitable. And Orthodox Christianity also faced the consequences for assisting the monarchy in it's anti-Christianity position. The persecution of church at Soviet hands had some public support .

Saturday, August 16, 2008

World War One and USA

Why USA joined WW1. Well the official answer is:
"When a German U-boat sank the British liner Lusitania in 1915, with 128 Americans aboard, U.S. President Woodrow Wilson vowed, "America was too proud to fight" and demanded an end to attacks on passenger ships. Germany complied. Wilson unsuccessfully tried to mediate a settlement. He repeatedly warned the U.S. would not tolerate unrestricted submarine warfare, in violation of international law and U.S. ideas of human rights. "

"After submarines sank seven U.S. merchant ships and the publication of the Zimmerman telegram, Wilson called for war on Germany, which the U.S. Congress declared on 6 April 1917."

Source- http://en.wikipedia.org/wiki/World_war_1

So, USA joined the war to protect it's citizens from Germany's unrestricted submarine warfare.
Why did Germany start unrestricted submarine warfare?
To cut down the import of food and other essentials to UK. UK was doing the same to Germany. IK had the world's largest surface fleet and could prevent cargo ships from entering Germany. The blockade of Germany was giving rise to famine-like situation. The only way for Germany to break the blockade was to force UK into a similar or worse scarcity and only unrestricted submarine warfare could do that, as enough material was reaching through neutral vessels.
This does not negate USA's position. USA had to protect it's citizens carry out their legal transactions. But this piece of news changes the contours:
"He had previously claimed neutrality, while calling for the arming of U.S. merchant ships delivering munitions to combatant Britain and quietly supporting the British blockading of German ports and mining of international waters, preventing the shipment of food from America and elsewhere to combatant Germany."

Source- http://en.wikipedia.org/wiki/World_war_1

So, Woolson strengthened UK's war-efforts, undermined Germany's war-efforts and when Germany retaliated in its dire crisis, he declared war on Germany. This deliberate provoking must have some purpose.

I feel that the USA's mostly English-origin elite felt threatened by the large numbers of German immigrants in the last two decades of 19th century. Today, people of German origin account for 17% of USA's population (largest ethnic group) and their per capita income is higher than USA's average. Most immigration from Germany occurred in the end of 19th century. Germans had a reputation for industriousness. The sudden expansion in German population, coupled with tales of German industriousness would have created deep fears in the Anglican elite's psyche. They might have feared that in combination with disadvantage groups (Irish and Afro-Americans), the Germans might sweep them out of power. And hence, the elite counteracted by attacking and demonizing Germany. This would other people in USA, suspicious of people of Germanic origin and the American Germans themselves would try to integrate into the societal norms sanctioned by the elite, to nullify suspicions and suspicion-related oppression based on their relationships with the enemy. Thus the English-origin elite could continue its political and cultural dominance

Thursday, August 14, 2008

Belief

I read in wikipedia's article on belief that belief is usually spontaneous and involuntary. From personal experience, I couldn't disagree more.I believe wikipedia tries to equate belief with unjustified opinions. But what constitutes justified? What is justified for one, may be unjustified for another. Given that justified opinion, is a belief assuming beliefs to be unjustified opinions, is circular. Hence, I consider X holds Y as a belief, if X affirms the same. If X holds Y as truth, than we cannot say X holds Y as a belief, it is an instinctive affirmation of Y. By consciously affirming that Y is his/her belief, X says that he/she considers not Y to be a possibility and has knowingly chosen Y and not Y. Hence, belief requires free-will (choosing Y over not Y, in absence of any necessary reasons to do so) .

Monday, August 11, 2008

Belief in God

Many people profess belief in God. I do not think one can believe in God. Let us see what belief is.Belief about something requires 2 things- awareness about that thing and choosing that thing even when we know that the negation of that thing is not necessarily false. Now, finite man cannot be aware of the possibility of the infinite nature of God, cannot even raise questions about the existence/non-existence of an infinite Being i.e God without the explicit will of God. Secondly, God cannot be the object, He is the Subject. Man cannot categorize God as actual, probable, possible or fictional. It can be said that man's categorization of God is not an action performed upon God. God and opinion about God are different. But this view does not take into account, the omnipotence of God. If opinions about God can exist independently of God, than conscious beings who can hold such opinions must also exist independently of God as opinions need conscious beings. This is not possible. Hence, any opinion about God bears the explicit consent of God. Thus faith in God is possible only due to the grace of God. Ishvaranka upare aastha, Ishvara Krupa dwara hi sambhava.
.

Sunday, May 25, 2008

Economies of scale

I have just joined Deloitte & Touche USA LLP pvt. ltd. It is my first job. I am quite excited about it.
I observed some facts about Deloitte. I had read somewhere in wikipedia that economies of scale benefit manufacturing entities more than service ones. My scant knowledge about Deloitte and its competitors doesnot support that view. In auditing, the Big 4 (PwC,Deloitte, E&Y and KPMG) account for over 70% of auditing business in USA. All 4 firms have over a hundred thousand employees and revenues in excess of $ 20 billion.So, econoimies of scale probably works even better in services( atleast in some services) than in manufacturing .
Why is it so? Some bottlenecks that would inhibit productivity are certainly present. These are-
1- More bureaucracy
2- Greater costs of standardization
3- Repetition
4- Greater communication costs and greater chances of miscommunication

So, what are the positives. In manufacturing capital costs promote economies of scale. A machine costing $ 1 million can be 100 times more productive than one costing $100000 million. Hence, economies of scale comes into play. Thsi is however, not applicable,for a professional services firm like Deloitte. Here the means of production(value-addition) is the individual human being and hence, agglomeration is not possible.

The question comes into mind-what are the positives of large professional service firms?
I believe the answers are-

  1. They have huge data bases. Data is the back-bone of auditing and consulting business and a huge data base is certainly a great help.
  2. The large firms have excellent relationships with large clients. The clientsbelieve that that the large firms are better equipped to protect their confidential data. More importantly, the large firms have much better access to the firm's past data and this can help them in their present duties
  3. These firms have more in-house experts. This might lower the costs of skill transfer.
  4. They are able to offer a larger basket of services.
  5. Prospects of fast career growth and become partners

More experience, will certainly help me to better understand the impact of above-stated reasons and uncover new ones.

No idea can change your life

"Water , water everywhere ,not a drop to drink"
My predicament is similar. There are lots of news,reports, views ideas, but none appeals to me. A sense of intellectual ennui has grabbed me. I find this change interesting.
The catchphrase- "an idea can change your life" was something I liked a lot. And hence, on the suggestions of some friends, I modified it. And now, I have got a new issue to rant and philosophize about :)
We live our lives with some purpose. Even if we lack a purpose, the places where we work have some purpose . We spend lots of time there and wittingly or unwittingly, we share the same purpose.Letting go of that purpose, for some time leads us to live a new life. We see new things , which were blinkered by our purpose, we see different perspectives. We may connect better with people as we interact with them as people and not as instruments for some purpose. We see new aspects of ourselves, aspects which had become invisible under the shadow of the purpose. And sometimes, we realize that our purpose is no longer a reliable indication of our self.
No idea can certainly change one's life.

Thursday, February 14, 2008

Tradition and Civilization

The blog is an attempt to defend some customs of India and to clear some misconceptions.

Support for female infanticide in Vedas?- I heard this absurd comment in a thread in the "Interfaith Dialogue" in Orkut.
I do not have any quotes from the Vedas to disprove this, but I am quoting from the Smritis , which are based on Vedas.
"Both Devala and Yajanavalkya opine that a raped woman cannot be divorced as she becomes pure after menstruation. The latter adds that the wife can be abandoned if she conceives a baby from another person, kills a brahmin or insinuates against her husband; if she is a habitual drinker, suffers from prolonged illness, is cunning, treacherous, sterile, exceptionally extravagant, or uncouth. But even in these cases she should be fed and clad well and properly looked after.
Source- http://esamskriti.com/html/inside.asp?cat=738&subcat=737&cname=hindu_women_as_life_partner

The quote was to show that even in the case of killing a brahman or drinking wine- 2 of the 5 mahapatakas( sins without expiation), a woman was not given capital punishment but her minimum wants were fulfilled.
The penalty for murder( of anyone) is death( unless the murderer belongs to some special category). Even Brahmans are liable to death-penalty if they murder a woman. And woman cannot be given capital punishment.

Source- http://books.google.com/books?id=Z070NJdQFOwC&pg=PA335&lpg=PA335&dq=capital-punishment+%2B+Dharmashastras&source=web&ots=naM2p26F-7&sig=vx7m1sCzqu4doIIAH1BxSEwTN4c#PPA341,M1
Hence, killing a woman simply because she is a woman was downright unimaginable in Vedic standards.

Brahmans supported Sati- All Dharma shastras say that Stri Hatya is equivalent to Brahmana Hatya. Thus Brahminical belief had nothing to do with Sati. Sati was popular in those areas where Brahminical hold was week.Infact, no one was forced to burn alive. It was the decision of the woman to go to Sati OR to lead a widow's life.. Most of them preferred to lead a widow's life.Sati was by defn. voluntary.

Brahmans led to the slavery of Indians- Brahmans had neither the muscle nor the military power to coerce others. If others believed them, it was their fault.

Anarcho-capitalism

Anarcho-capitalism has two central doctrines-
  1. No person has the right to commit aggression against any other person
  2. If my labour is mixed with something I have the first right to claim it.

These positions lead to several problems , which are:-
Inherent contradiction:-
In procreating , the labour of the two parents is mixed and the event takes place within the body of one( the mother).Assuming sovereignty over the body, the child is the property of the mother as the child was born in mother's womb and by the fusion of her eggs with the father's sperm.Unless the father makes an explicit claim to the child, it is assumed that his sperms were given freely.

I have the right to do anything with my property. Hence, I can commit aggression against my child. But this violates the axiom that No person has the right to commit aggression against any person.

Hence, the anarcho-capitalism position is mutually contradictory .

Destructive of civilization.:- No person has the right to commit aggression against any person.(Anarcho-capitalism position)
Aggression means causing or trying to cause any change in my body without my free-will.
No person is born with his/her free will.
Being born causes a change in the body( the body is created) and hence it constitutes an aggression.
Thus all parents are liable to prosecution for being parents .
As humans are selfish, all will sue their parents and win damages.
Hence, no one will procreate.

Development of monopoly in Security:- Security will tend to get monopolized. This reasoning is not difficult to see.
The chief functions of (private)security service are- preventing crime, investigating crime and collecting dues.
Assuming that one person can oversee 2 sq. km and over that area 1000 households live.It is assumed that 1 office is required for every 1000 households.
If a service, say A has monopoly over an area, it can oversee 1000 households using 1 person. On the other hand if a service,say B has say 1000 households, spread over 4 sq. km, it will require 2 men to do the same.
Assuming equal wages, A will save on costs.

Similarly, the average distance of a customer household from the office is greater for B than A. Hence , even for equal fees, the customer's costs will be more for B as compared to A.As the distance, from the target households increases, the costs of investigating also increases. Hence, A gets benefited.

The collection costs also increase for B as compared to A as its employees have to travel greater distance or they have to set up more collection points for collecton from the similar customer base.

Say , all people of an area agree that entry after midnight will be considered as a breach of property.Now, one person enter household C which is not serviced by B. But, its neighboring household is serviced by B. Will the beat constable wait to see, the future activities of the person ?The person may enter a household serviced by B. If yes, the beat constable will lose time with no certainity of apprehending a "thief".If no, then there may be an avoidable robbery.The costs of investigating are likely to be higher than the costs of preventing. In case of A , the beat constable would have simply apprehended the "thief" and thereby saved time and money(probably)

Hence, a local monopoly seems to be the most important possibility as the service holder will be able to provide superior service at lower costs for itself.

Once a monopoly has been formed, it will charge very high fees( say charge of services is 4 times the cost of servces) . The customers will have no option except to leave. Else, if they do not pay, the services will be withheld and some unidentified goons( the employees of the service providor) will decamp with all property at night and destroy what they cannot take.

It may be assumed that other players will band together . They will calculate that by destroying the monopoly, they will get access to new markets.If they band together , either they will carve the whole area into smaller monopolies or all will have the right to compete in the areas held by the previous monopoly.

The monopoly, will not leave its profits so easily. It will fight. And the area will get damaged.

If the winners decide to parcel the bigger monopoly into smaller parts, the customers will not benefit. If they decide to allow competition, they will first calculate the cost and benefits of their action-
Assuming the monopoly provider is charging 500 units/year.
Cost of providing service per person is 100 units.
Any player who enters the market will have to charge less than 500. Now, as more than one player has broken the monopoly - all of them will be competitors in the new market. Hence, the total price charged by all players will fall substantially below 500, say 200.
So, for every unit of cost the new players will gain 1 unit.
But the old player will lose 4 units.
Assumption- The old player is rady to invest 3000 units/person in "defending" the city.
The other players will have to invest ,atleast an equivalent amount( for practical purposes , they will have to invest more)
The other players will investing >3000 units/person , only if they believe the future cash-flows will more than compensate for the investment.
Now,before investing every company checks the NPV( Net Present Value) of investments.
Assuming the companies will get 10% return on investment, if they made the investment elsewhere.
The annual cash-flow required , so as not to make a loss on the investment is 300 units/person/year .( Assuming no increase in cash-flow)
Anticipated cash-flow is only 100 units/ person/year.
Hence, they will never invest the money.
On the other hand, as the monopoly is still getting 400 units/person/ year, it can make the investment.
Hence, monopoly will not be challenged.Thus anarcho-capitalism can never provide security as security will tend to get monopolized and once monopolized , it will not be challenged, unless the competitors want to enforce a similar monopoly.