The Palimpsest of Sawbones Surio

Pessimism of the Intellect, Optimism of the Will

“Worker-Bees” of the world, unite? Part-II

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Greetings! Back after a brief lull, which I had explained here. Moving on to Part-2 of a multi-part post that concerns my thoughts on “trade” as practised today in the “flat” world. If you wish to refresh your memory, or you’ve joined me from here, you’ll find Part-I here.

In Part-1, I placed a rather polemic argument, “trade is like slavery in its current form”. A few well-meaning arguments against that bellicose remark was pre-empted by me, and I tackled the argument “Trade is a great thing […] best product/best price/most efficient producers” in my last post. I had a lively exchange of views with the regulars (my chocks ;-)) Here, I submit my response to the second (pre-empted) objection made in favour of trade, based on my polemic remark. But before that, I wish to clear the air on certain points that seem to have formed on account of my earlier post.

I don’t live in the past, nor do I consider myself a Luddite! I am comfortable with and around technology and effectively acknowledge the happenings around the World. However, having rolled in the juggernaut for a while, I am beginning to appreciate more and more, the idea of “appropriate technology” and self-sufficiency.

Speaking of the past, it has become convenient to dismiss History with remarks of “This time it’s all very different”, or “it’s time to move on from all that”. Well, agreed (to a point). But an undeniable fact of today’s life is that the platform of co-existence of today that everyone seems quite eager to maintain and justify, was effectively built from that history. So if we are all brothers and sisters and can live peacefully like these, can we all start the counter from scratch then, please? Two pictures ought to paint a few dozen words:

Percentage population living on less than $1 a day (2007-08):

Percentage population living on less than $1 a day (2007-08)

Human Development Index (HDI): a composite statistic used to rank countries by “human development”:

UN Human Development Report 2010

Well, colour me stupid (pun intended), but is it an ironic coincidence that virtually all the countries with “bad marks/colours” on both images are erstwhile colonies (or were controlled – like China) of some Imperial power or the other? Another thing: Exhibit B keeps changing its colours every year (actually, they have been changing the formulas for calculating the HDI, so time will tell if it is a bikini thing or a “true” statistic) but even that exhibits the same trend. Like it or not, most human beings are products of their times, and when Imperialism was discarded, “Socialism/Marxism” was the only “other big alternative” in the horizon at that point in time to continue with “business-as-usual” and keep the “nation-state” dominant paradigm. In one of those ironies History dishes out from time to time, Socialism collapsed before Capitalism did, and today, we are where we are on account of that. But the important question being pushed aside in all this is “Why did so many (select group of) countries en masse choose to specifically embrace Socialism in the first place?” A point to ponder, No? (Hint: A (knee-jerk?) response to Imperialism in the first place {taking cue from Russia of course!})

I mentioned in my discussions in the first post, and I will repeat it here: *Trade* in its strict definition being conducted as recent as the Silk route times, is quite fine by me. But I have serious reservations about how it is carried out today. I do not view self-sufficiency as “deprivation” either, as many in this day and age are wont to do.

Share of World GDP: Way back to 1500

Share of GDP: Going all the way to 1500

Share of Population Growth: Way back to 1500

Share of World Population growth going all the way back to 1500

Since the graphs are fairly self-explanatory, I don’t need to expand on the above graphs themselves. Of note is the observation that India’s population had been proportional to its share of GDP in the world and its share of population growth hasn’t changed from the past. While I am least interested in jingoism/patriotism at this stage of planetary evolution, reading the thought experiments from Part-I might put this graph in perspective. Right. On with the show now.

Billions of people in developing countries have been lifted out of poverty by trade

With the above graphs as a gentle reminder, might I ask people to reconsider the remark itself with another question: “What did cause the poverty that you speak of in the first place?” There’s no easy answer, so we’ll leave it at that. I don’t know if those billions of people have been lifted, but certainly we’ve had a burst of billionaires(!) emerging from India and Russia!

Copyright: Where are the billionaires?

Lies, Damned Lies and Statistics
Assumed fair use.

A corollary to that “What people see is only part of the story” illustration above is the other famous quote:

Statistics are like bikinis. What they reveal is suggestive, but what they conceal is vital. — Aaron Levenstein 

I. Firstly, this notion of somehow participating in trade, and thereby contributing to the act of “alleviating someone else’s poverty” is one of the oldest [[emotion]] that has tugged our heartstrings (and has been successfully exploited for a long time now). Oscar Wilde has writtencritiqued it as follows:

The majority of people spoil their lives by an unhealthy and exaggerated altruism. They find themselves surrounded by hideous poverty, by hideous ugliness, by hideous starvation. It is inevitable that they should be strongly moved by all this. The emotions of man are stirred more quickly than man’s intelligence; and, as I pointed out some time ago in an article on the function of criticism, it is much more easy to have sympathy with suffering than it is to have sympathy with thought. Accordingly, with admirable though misdirected intentions, they very seriously and very sentimentally set themselves to the task of remedying the evils that they see. But their remedies do not cure the disease: they merely prolong it. Indeed, their remedies are part of the disease. They try to solve the problem of poverty, for instance, by keeping the poor alive; or, in the case of a very advanced school, by amusing the poor.[…] The proper aim is to try and reconstruct society on such a basis that poverty will be impossible. And the altruistic virtues have really prevented the carrying out of this aim. Just as the worst slave-owners were those who were kind to their slaves, and so prevented the horror of the system being realised by those who suffered from it, and understood by those who contemplated it […]

Considering the fact that this (empiric) observation still holds true since the times of Oscar Wilde, I will simply submit that this “notion” of trade somehow pulling everyone into another better world is a somewhat flawed point. After all, if people have been helping the “poor” out of poverty since those times (and perhaps before), there shouldn’t be any more poor left in this world, so to speak. I am aware this is a sweeping statement, but either way you want to take this argument forward on this premise, you will realise that the broader implications of the point is still valid.

II. Secondly, what people forget is that “poverty” used in its conventional sense is always a relative term. I am “poorer” when compared to a person who owns a bungalow and an expensive car(s) and who sends his children to an expensive private school, etc., etc. The other person might consider himself poorer to someone else who might lead a more extravagant lifestyle to person B. And so on. (But, Jacob has punctured this notion in one of his really early posts!). However, this condition (of poverty) is largely a human made epidermic and will exist as long as humanity will continue to exist! What do I mean by that? Let me tell you one of those “Zen” stories I read a while ago!

A samurai, a very proud warrior, came to see a Zen Master one day. The samurai was very famous, but looking at the beauty of the Master and the Grace of the moment, he suddenly felt inferior.

He said to the Master, “Why am I feeling inferior? Just a moment ago everything was okay. As I entered your court suddenly I felt inferior. I have never felt like that before. I have faced death many times, and I have never felt any fear — why am I now feeling frightened?”

The Master said, “Wait. When everyone else has gone, I will answer”. By evening the room was empty, and the samurai said, “Now, can you answer me?”

The Master said, “Come outside”. And he said, “Look at these trees. This tree is high in the sky and this small one beside it. They both have existed beside my window for years, and there has never been any problem. The smaller tree has never said to the big tree, ‘Why do I feel inferior before you?’ This tree is small, and that tree is big — why have I never heard a whisper of it?”

The samurai said, “Because they can’t compare”.

The Master replied, “Then you need not ask me. You know the answer.”

With this kind of (prevalent) mindset among much of humanity, I don’t carry any hope of “alleviating poverty” to begin with! Do you? Now when this story is told, people decide to qualify their remarks to actually mean “absolute poverty”, then we are muddling the waters/mixing up semantics, because here trade matters not! Why? I’ll explain by and by.

III. Thirdly, being a cynic at times (with good reason), I’ve always wondered how much of “lifting out of poverty” is what World Bank would like us to swallow and how much of it is true. There are some fundamentally flawed assumptions behind this “axiom” stated above. Closer reading of the mechanics behind “trade” reveals that the above “axiom” completely hinges upon two models:

Here’s the clanger! As early as 1951, Leontief paradox disproved the H-O model by using data from that self-proclaimed “free-trade champion” the USA! Indeed, Wikipedia says: “Various attempts in 1960’s and 1970s to “solve” the Leontief paradox and save the Heckscher-Ohlin Theory failed. From 1980’s a new series of statistical tests had been tried”!. Further reading tells you this: “Although H-O model is normally thought to be basic for the international trade theory, there are many points of criticism against the model”. Well, call me Karl and brand me a Luddite if you want, but: To use a failed model (became known by 1951 itself!) as the basis to force everyone to play the “same game” and furthermore, insisting that this is the “right” model for all? Now, how many of you want to get off this train-wreck?

Now, the second clanger: In this paper, it is clearly shown through studies conducted in the various “liberalised” Latin American countries that wage inequality actually rose rather than what S-S theorem predicts (In an anecdotal way, the reality observed in the trenches here in India, also confirms this view). A newly formed consenseus (compromise?) based on Latin American studies is to recognize that technically the Stolper-Samuelson theorem predicts a relationship between output prices and relative wages. I don’t think I ever consented to wanting a “cheap” doo-daah at the expense of somebody else’s wages, did you?

Further, another paper by Robert. H. Wade from the LSE also deals with the question “Is Globalization Reducing Poverty and Inequality?”. First the paper points out some commonly heard pro-and-con arguments:

In the last 20 years, India, China, and the rest of East Asia, experienced fast economic growth and falls in the poverty rate, Latin America stagnated, the former Soviet Union, Central and Eastern Europe, and sub-Saharan Africa regressed.

Evidence from the current long wave of globalization thus confirms neoliberal economic theory—more open economies are more prosperous, economies that liberalize more experience a faster rate of progress, and people who resist further economic liberalization must be acting out of vested or “rent-seeking” interests.

Left assumption, in contrast, is that the rich and powerful countries and classes have little interest in greater equity. Consistent with this view, the “anti-globalization” (more accurately, “anti-neoliberal”) argument asserts that world poverty and inequality have been rising, not falling, due to forces unleashed by the same globalization.

Sounds like the usual rhetoric, isn’t it? But the paper points out the following, in a nutshell: “This paper questions the empirical basis of the neoliberal argument. In addition, it goes beyond the questions to suggest different conclusions about levels and trends, stated in terms not of certainties but stronger or weaker probabilities. Finally it explains why we should be concerned about probably-rising world inequality, and how we might think about the neglected subject of the political economy of statistics.”

1. The paper points out several flaws in World Bank’s strategies that are designed to swing the bias in favour of the World Bank’s arguments:

a) “A recent study in India suggests that a switch from the standard 30-day reporting period to a seven-day reporting period lifts 175 million people from poverty, a nearly 50% drop. This is using the Indian official poverty line. Using the higher $1/day international line the drop would be even greater”.

b) “the shape of income distribution near the poverty line is such that, in most developing countries, a given percentage change in the line brings a similar or larger percentage change in the number of people below it. Recent research on China suggests that a 10% increase in the line brings a roughly 20% increase in the poverty headcount.” Now, go back and read the neoliberal argument on India/China once again. 😉

2. The paper also highlights that “A comparison of two recent Bank publications suggests how the Bank’s statements about poverty are affected by its tactics and the ideological predispositions of those in the ideas-controlling positions.”. And then goes on to point out all the contradictions in its projections and numbers over a period of time.

3. Further, Wade writes: “To the question: ‘What is the trend of world income distribution?’ the short answer is, ‘It depends on which combination out of many plausible combinations(*) of measures and countries we choose.’ Whereas we could get better data on the poor to the extent that the poverty headcount would command general agreement, there is no single best measure of world income inequality.”.

(*) Robert Wade then goes on to demonstrate many “official” measures that prove to be biased towards policy statements. In fact, this is found, towards the conclusion: “One combination of inequality measures does yield the conclusion that income inequality has been falling––PPP income per capita weighted by population, measured by an averaging coefficient such as the GINI. But take out China and even this measure shows widening inequality. Falling inequality is thus not a generalized feature of the world economy even by the most favourable measure.”

I suggest that you read the paper yourself in order to find many such clangers on the “bikini”. Well, if you want my summary of the paper, the overall conclusion is bleak, to say the least. If you wish to continue your studies in this matter may I suggest for some fairly involved and entertaining reading along these lines. Perhaps, you could even suggest some optimistic reading material for me to lift my spirits! 😐

So far, the only highlight about this entire exercise for me is to enlighten my readers, the fact about Stolper-Samuelson theorem which, as a matter of fact, goes to confirm a relationship between output prices and relative wages. In other words, when we have a “low price guarantee” (cue jingling coins), someone else doesn’t get a decent enough pay!

Addendum to Second Point: In all the studies on impacts of “liberalisation” on Latin American economies, it was found that “liberalisation led to greater demand for skilled workers and pushed unskilled workers into unemployment/informal activities“. A contradictory point to be borne in mind along with the above, is that one of the prerequisites of the “liberalisation package” offered to many of the countiries is that most services that were once state-controlled ought to be privatised (a profit motive) as part of the liberalisation. This includes most utilities (electricity, water (remember Bolivia?), sanitation), education, collective agriculture, subsidised housing etc. Put the two together, and you’ll find the dispossessed have a very slim chance to get back into the system of “rising tide”. They effectively become the “lost workforce”, and slowly descend into the so called “absolute poverty” level. In what way can trade ever lift them from here? Most of them will be reduced to manual work of lifting, cleaning, etc. Indeed, this is the contradiction that I pointed out in the “muddling of semantics” remark earlier.

In other words, while people with some skill-sets *can* participate in the “job lottery” and therefore, trade may (mostly not, as per the data above) lift the lifestyles of these categories of people. Ironically, the type of people the World bank claims trade will benefit, namely the poor people that live on under $2/day, will almost never be (maybe not directly) impacted by the consequences of trade. They will mostly be subject to the whims and fancies of the local economic framework which does not necessarily dance to the tune of macroeconomic levels all the time. This realisation came to me when I read the book, “Portfolios of the Poor: How the World’s Poor Live on $2 a Day”. Don’t click yet. I discuss this in greater detail further below.

A story that probably deserves a mention in the context of people being left behind (forever) due to goose-feeding the same “Western” business model to all and sundry deals with Maharashtra. Some Excerpts!

Every time an aircraft flew over Pen in Maharashtra’s Raigad district, children in the tribal village would look at it and say Bharti Sheed, one of their own, was on it. Sheed, 24, had made it to the first batch of a course specially designed by the state government for the tribal community at the privately run Air Hostess Academy (AHA) in Pune. Three years on, those dreams have rudely crash-landed for Sheed and more than 100 other tribal youngsters who had joined AHA. None of the students who passed out of the first batch of the course in 2008 or the second one a year later has got any aviation jobs.
Maharashtra’s Minister for Tribal Development Babanrao Pachpute blames the students themselves, saying they were lacking on many fronts — particularly physical assets……
“They are not physically appealing and because of their strong local accent they are not good communicators too.”,…. adding that the government would consider implementing the project by trying to get the girls jobs in the hospitality sector.

“Despite being poor we spent money to buy blazers, high-heel footwear and cosmetics. Now we have to throw them all away,” Sheed said, speaking for her classmates.

Last year, Sheed applied for vacancies advertised by Air India under the ST quota but didn’t make it. “I was rejected on grounds of not having the mandatory three-month experience in the industry,” she said.

Students say far from getting mandatory in-flight training, they were not even shown a real aircraft. They could not even intern as cabin crew and had to settle for internships as ground staff, hotel receptionists and in call centres. What the year-long training included was effective communication, hosting and serving and life-saving skills, plus knowledge of first aid and customer care. The girls learnt to shed their inhibitions, from speaking in English without an accent to wearing make-up and short skirts with stockings.

IMO, it is very fortunate for those girls/women, that they did not end up in brothels and as other dangerous pawns of disenfranchisement! Certainly I despair to think how badly we will scar the entire world with the intention of “educating, clothing and jobbing them”, and then finally turn the tables and point out “once a savage, always a savage”. 😥

More recently (also from Maharashtra), it was heartening to note that people no longer buy the horse manure touted behind the “job-creation” rubbish! Here’s a recent article that came up on the news:

Martala Sarpanch (village head), Mr Madhav Dhepe told Business Line that MIDC (Maharashtra Industrial Development Corporation ) is offering about INR 80,000 per acre as compensation, while the market rate is INR 2 million per acre. He said that “Boys in our village are educated till High School but MIDC requires educated work force. Only jobs for our boys would be as peons or casual labourers. We don’t want such development.”

Another local farmer, Mr Dadarao Yede said that some years ago farmers would have sold their land to MIDC, as they were not getting good income from their farms. But today the situation has changed, we are getting good rates for cotton. My earlier yield per acre was 300 kg but today it has increased to about 800 kg due to better variety of cotton seeds. Today the villagers have an annual income of INR 1 to 0.15 million per acre.

NOTE: I deliberately kept the second paragraph to point out the vagaries of “trade”. In a good way, it is ironic(!) that prices picked up at the opportune moment and saved those poor “boys” from a life of subservience and resentment (not to mention the girls too!). Times like these, I feel “There’s someone up there that likes some people sometimes”!

Over 2.7 billion people in the world manage to put food on the table, keep a roof over their heads, plan for medical emergencies, and even save for retirement on $2 or less a day

Over 2.7 billion people in the world manage to put food on the table, keep a roof over their heads, plan for medical emergencies, and even save for retirement on $2 or less a day

To finish, I am returning to the book, “Portfolios of the Poor: How the World’s Poor Live on $2 a Day” to highlight some of the real “facts” about the “dirt poor”. An ‘unputdownable’ book, it humbled me to the point where I don’t sympathise with them in the “Ohhhh, the poooah peeopple! Howwww saaaadddd!” anymore. I am filled with respect and awe for them. The “dirt poor” live such sophisticated financial lives, they put us rich people to shame (Yes! If you have time enough to blog/read a blog, you are rich! Accept it!)

There’s only one thing that I do get mad about in the status quo of things! It is about the fact that these ‘beautiful people’ live in abject squalor in slums within the cities, which in themselves are huge resource sinks!. That’s clearly an injustice perpetrated by the business/politic collusion. No other way of putting it! Most of the inhabitants are migrants from rural areas because of the wilful neglect of the Government and in collusion with business (*). It needn’t be so. A common misconception that is encountered is that all “jobs” are to be found in the cities, which force the rural populace into long exoduses!

(*) For example, Curitibas slums stemmed from a huge rural exodus caused by the mechanization of Parana state’s agriculture(^)

In this connection there’s already commendable work that has been done in India. If you’ve heard of Hernando de Soto’s work on property rights in Peru, this had already been achieved in India long ago! But de Soto’s work is only partial, in the sense that it doesn’t close the loop completely. Here also, there has been some impressive prior art for the World to take lead, namely, the idea of forming cooperatives (based on Marxist/Socialist themes! Surprise! Horror!) around small scale producers. Asika, India Coffee House are a few successful instances that come to mind. Overseas readers might empathise with Mondragon Corporation in Europe! There’s wilful ignoring and sabotaging of such movements in India (see here) as well as in many parts of the World by the political machinery. Such locally proactive approaches would actually prevent the poverty and deracination problems that “bare-naked” trade offers to solve, from occuring in the first place! Once again, I say this: Trade? Yes, but definitely not the way it is carried out right now! About the book’s takeaways:

  1. The dataset involved tracking the daily and financial lives of over 200 families in Bangladesh, India and South Africa for more than a year.
  2. A “Triple Whammy” effect that affects the poor is quoted to death throughout the book! Actualy, I began hating it after a while. OK, OK! you’ve made your point! Not only are their incomes small and infrequent, but the majority of the very poor lack access to reliable, flexible financial tools that allow them to save their small funds over a long-period of time. They also lack access to reliable loans. Ironically, for all the emphasis on the “whammy”, the last point becomes a non-sequitur, as the book goes to prove later: The poor have an an impressive variety of savings clubs, savings schemes and credit instruments. No seriously! This itself will take a complete post! In one scheme, the poor pay interest to others to hold their savings because few banks will hold the small amounts the poor save!
  3. The poor borrow large amounts for school, weddings, funerals, health, business relative to their net worth and truly enjoy their lives! Grim lives? Ha! And ironically, us “sophisticated types” would consider them lacking in collateral.
  4. One thing was clear: health costs, either in the form of a sudden event or a long-expected death, was a huge strain, because of a) lost income potential and b) cost of treatment.
  5. I am a media victim, in the sense that I was led to believe that money-lenders were loan sharks preying on the poor. Boy, was I wrong! Most data is annualised to allow ease of comparison with “institutions”, which is where all the confusion arises. These loans are actually held no more than a month! Indeed, many participating familes deliberately choose a more expensive moneylender because the looser repayment schedule fits their needs better, or because the money must be found quickly!
  6. Grameen bank gets a whole chapter, but I suppose this is old news today
  7. Social capital is their saviour pretty much all the time (interest free loans from friends, relatives and neighbours). However, the book suggests that there’s a lot of social anxiety and tension revolving around this, despite itsprevalence. Having interacted with this spectrum on and off, I believe that the “Western bias” i.e., disbelief in the functioning of the type of social cohesion seen in Asia led to some “leading questions” to the families, which the participants then answered in the affirmative to “please the officials”!

Final Comments

Ermine and HSpencer had challenged me if it was trade or if it was concetration of power within the corporations that I was opposed to in the first place. Between those two points, I conceded that it was the latter, but then again with the muddling of semantics everywhere, I am simply going with the use of the word trade to capture the essence of what corporations do at the end of the day. The point they were trying to make is best illustrated with this infographic from here.

The illusion of diversity: visualizing ownership in the soft drink industry. Three firms own 89% of US soft drink sales!

The illusion of diversity: visualizing ownership in the soft drink industry. Three firms own 89% of US soft drink sales!

A Robert Solow quote to end the day with the hope it is still not too late to adopt this message in parts at least!

“Over the long term, places with strong, distinctive identities are more likely to prosper than places without them. Every place must identify its strongest most distinctive features and develop them or run the risk of being all things to all persons and nothing special to any…Livability is not a middle-class luxury. It is an economic imperative.”

But unfortunately trade today has decided to do the opposite! Hoo Boy! See you in Part-III.

Read Part III here.

Unless specifically mentioned, all images are copyright of their respective owners. Assumed fair use while embedding them. All images are “hot linked” from their original sources.

Written by Surio

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11 Responses

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  1. Impressive research 10/10

    Graphics 10/10

    References 10/10

    Latest Data 10/10

    Presentation 10/10

    I feel like I should be paying you for such a fine report!!

    So in a nutshell, are you summing that the poor people got along fine, until the West showed them just how poor they were?

    Are you saying as your main point, the West has meddled with the “Natural Order of Things”? Thereby skewing the course of the world which should have progressed without intervention?

    Are you suggesting as a secondary point that the Western economic model cannot be compared to any third world country of lesser means?

    If so, I find no fault with the information hereto presented. Why do I keep thinking I already realized all this? I would think not that I studied it in college, but rather my feet walked the grounds, my mind envisioned the thoughts, and my eyes saw for themselves.

    Still—-I am not convinced that intervention in third world countries (who desperately need assistance) is incorrect.

    Much more to say, but am dazzled by all the presented charts and data for now.

    This has become quite the thought provoker, no?


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    • Spence,
      Thank you! I am flattered. We don’t accept VISA/MasterCard but we do accept compliments. And I think you’ve paid me in full! 😉

      On top of the two points you make, I would also add some more points. If Since you read History, you’ll find most of the native population weren’t insular or hostile to begin with. If it were not for the Native Americans, the pilgrims would not have survived their winter! But quick reading of the equivalent (subsequent) European treatment of the Native Americans will put anyone to shame. The South American tribes, (being more psychically intuned perhaps) sussed out the Spaniards’ ulterior motives and therefore were hostile from the word get-go. And Spain’s record with South America actually still stirs up hostile emotions! If you read European antics in Asia as well, you’ll realise that the Europeans had neither the edge nor the wherewithal for the trade. “Trade” was already very extensive in Asia but was conducted as an “equal exchange” or “exchange of some value” which the Europeans could not produce in the first place, for a long time. All the subsequent chicanery came on account of that. The Japanese were cheated off their gold by Perry’s Americans by misusing the token of gifting… The Koreans decided to close their borders mainly because they saw the tricks the British got up to in the Opium wars. I could go on.
      The other simple fact (not concerned to trade) was that the indigenous population had a certain life pattern in the same way as the Europeans had theirs. The contempt of the Europeans for the others’ way of life led to all the colonisation/persecution.
      To reiterate, the indigenous population were trading before and did want to make contact and exchange goods with the visitors.

      If we talk of HDI, then we have to acknowledge that the whole platform where developed world is quoted as “the standard to aspire” was built on the backs of the looting and plundering and stealing of what did not originally belong to them in the first place. Again Robert Solow provides us with a quote for the occasion 😐

      There is no evidence that God ever intended the United States of America(*) to have a higher per capita income than the rest of the world for eternity

      (*) or any other country, IMO!

      Glad that these writings actually strike a chord! “my feet walked the grounds, my mind envisioned the thoughts, and my eyes saw for themselves.” I like the ring of the sentence! 🙂

      Re: provide assistance to other countries or not? This is the eternal Empathy vs. Sympathy debate. I must admit, it is very tricky. We can tackle this later.

      Also, let’s not forget. Let’s ask ourselves, what made them “third world” to begin with? And next, if they persist that way after prolonged “aid” then the “aid model” is broken, not the “people model” as itis made out in the media. The “Portfolios of Poor” is also helpful to point this out.

      I am glad if people find it thought provoking. As to the thoughts that you see here, they’ve been smouldering over a long time, through the readings and impressions formed during my visits to the British Library’s India Office and also through my general interest. Unwittingly, the discussion between photoguy/Plain_Simple made me interfere and produce all this brain dumps..etc..etc…


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  2. An analogy–

    The year was 1984. Master Sergeant Spencer was just promoted, and moved to the Brigade Headquarters as Logistics NCO for his Artillery Brigade. On his new desk was sitting a Zenith monster with a TV looking screen, and something called a “256”. There was something referring to “memory and ram”. The next thing required was the learning of “DOS”. Yes, computers had infected the happy, peaceful world of the US Army, like it or not!
    We did NOT like it, no, not a bit. We were fine. Everyone was an expert with his/her columnar pads and journals. Everyone carried a thick notebook of hints, means, expressions, and formulas of how to do his/her job. It was very personal and one took high pride in their notebooks and manuals. Few to none wanted to learn a new electronic way of life. It was adverse to the “Natural Order of Things” as we knew them! It was our “big ship”.

    One either got the message, or one got out. Survival depended on knowing “DOS”. Microfiche was history. IBM cards were “old news”. The next new word was “word processing” via computer. Good bye electric typewriter. (I still had my IBM Selectric III in my office when I retired in ’02.)
    WE DID NOT WANT THEM!!!!!!!!(‘puters)
    Fast forward 1990. Couldn’t live without them!!



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    • *wry smile*.

      BTW, Jacob gives me the best quip for this situation you describe:

      In our knowledge based society we know how to build factories and cars, we know how to build plastic bags and airconditioners, we know how to genetically modify plants and build guided missiles. We just go ask some expert that has dedicated his entire life to such pursuits. However, nobody seems to know or even ask why and if we should build factories, cars, GM plants or guided missiles. The wisdom is lacking and there is an implicit understanding that all knowledge is objective and value neutral. Perhaps it is but knowledge without wisdom is as dangerous as wisdom without knowledge is impotent.

      Original article


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  3. YIKES!!

    I just hopped over to ERE forum and read plain- simple novice’s reply to you.
    ODD to say the least. My “analogy” and his post had nothing to do with each other. I wrote mine last night, before his “computer” story in his reply.

    Odd odd Odd!


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    • Sigh! “Odd” sounds about right. I give up trying to reason with Plain_Simple’s point! To think it was him who sounded the “trade is slavery” bell to begin with. *Sigh!*

      It seems that pretty much everyone seems to accept that ERE is not just about living in an RV, eating beans, taking cold showers, and wearing a sweater, right?

      But somehow people seem to be convinced that if one has issues with how trade and the subsequent cultural/ political/ economic tug-of-war from the skewed trade then that person has no other option but to drop down to his loins, pick up a spear/bow-arrow and disappear into the woods — or else be called a hypocrite (the worst possible insult in a PO-MO world)! I think I give up trying to point the oddity.

      Haven’t people seen the link and discussion I made on Fair trade concept for fighting the imbalance?


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  4. Part of the problem is that the limited liability corporation will naturally tend to privatise the profits and socialise the losses, which favours reckless risk-taking. The banks showed us how it’s done – if you take the risks, even ones you may know are poorly grounded, then go for it, as you keep the profits. If your risks were badly assessed, what’s the worst that can happen? You lose your job or you go bust.

    This asymmetry leads to undesirabe outcomes. However, the polar opposite, communism, fails to incentivise people to take necessary risks. Somewhere in between lies the right balance, and it may be different for different industries 😦

    I still think the issue is the size and geographic reach of corporations exceeding the size of governments, rather than trade in itself. Power corrupts.


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    • Ermine,
      Interesting points. When we are looking at the juggernaut as it rolls, we have these observations you make. Me, I am starting by asking, why is the juggernaut rolling the way it is rolling today? If you approach it from that angle, perhaps you might be empathetic to what I am trying to say.

      Trade is what corporations do, at the end of the day. What is now happening with our POVs, is the classic case of Blind men and an elephant :-D.

      ermine wrote:
      > I still think the issue is the size and geographic reach of corporations
      > exceeding the size of governments, rather than trade in itself
      Surio wrote (in the post):
      *Trade* in its strict definition being conducted as recent as the Silk route times, is quite fine by me. But I have serious reservations about how it is carried out today.

      I have conceded this point you make. I even inserted a infographic to that effect to highlight that aspect of the problem :-P. But it is not the only problem though as you point out.

      • What if the thought experiment I mentioned in Part-I about Kimonos, carts, etc., was real? Will trade still be as OK as it was to you today?
      • What if the likes of UK, USA, Germany had call centres fielding calls in Mandarin, Korean, Gujarathi, etc., instead of how it is today?
      • Why do we mix and match goods-based-economy with services-based-economy? (I am still reading Man, Economy…. I might have a reply later ;-))
      • Why do we have skewed valuations of a country’s worth by valuing intangibles (patents, copyrights) more than tangibles (oceans, woodlands, mountains), even though it is the latter that matters in the long run?
      • Et cetra


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    • […] of people in developing countries have been lifted out of poverty by trade […]

    • […] of the prevalent opinions in the World regarding “Modern” Trade. Here’s Part 1, Part 2 and Part 3 of the series, addressing the other common myths on “trade’s […]

    • […] Part II here. Printer FriendlyLike this:LikeBe the first to like this […]

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