The company we keep

The merits of an argument or the truth of a proposition are independent of the motives and the moral character of the person making the argument or advancing the proposition. Still there are times when I go back to the intellectual drawing board for further scrutiny of fact and logic simply because of the source of the support or opposition that I encounter when I advance a particular argument. The most telling example was a comment on a blog on racism and freedom of speech I received from a KKK member in the US, who wrote he quite agreed with me on freedom of speech, but took a line different from me on racism. Another example was the letter I received in response to a blog by Anne Sibert and myself on the National Health Service , first published in the Daily Telegraph - arguing for its abolition and replacement by a continental European-style comprehensive and mandatory insurance mechanism. The author informed me that we made "...no mention that the NHS has been weakened and weighed down by the enormous number of immigrants entering this country since its formation,...". Perhaps I should have sent him the following answer: I know exactly what you are talking about. Immigrants - they're everywhere. I even got four of them living in my own home: my son (from Peru), my daughter (from Bolivia), my wife (from the USA) and myself (from the Netherlands). Sometimes being judged by the uninvited company you keep can be rather embarrassing. Still, just because Hitler, Stalin, Mao and Pol Pot probably would have agreed with me, most of the time, that two plus two equal four, is no reason for abandoning that bit of arithmetic. So we hold our noses and proceed.

Those whom the gods wish to destroy…

The United Nations Office on Drugs and Crime (UNODC) has published a new report on poppy cultivation and opium production in Afghanistan, the Afghanistan Opium Survey 2007. The report contains some useful and sobering facts. In 2007, the acreage cultivated with opium poppies in Afghanistan increased by 17% over the 2006 level. The amount of Afghan land used for opium is now larger than the corresponding total for coca cultivation in Latin America (Colombia, Peru and Bolivia combined). Opium yields also increased (to 42.5 kg/ha in 2007 from 37.0 kg/ha in 2006). Afghanistan therefore produced an extraordinary 8,200 tons of opium in 2007 (34% more than in 2006 and 93% of the global opiates market).

The report also contains some some ludicrous assertions and cockamamie analysis, which one suspects was dropped on the authors of the report from on high. This suspicion is strengthened by the singularly loopy statements at the launch of the document and in its Introduction by Antonio Maria Costa, Executive Director of the UNODC (and my former colleague on the Executive Committee of the European Bank for Reconstruction and Development). Mr. Costa is one of those bureaucrats for whom the conventional scientific modes of proof - proof by deduction and proof by induction - take second place to a third mode of proof (not yet recognised as fully legitimate in scholarly discourse - proof by repeated assertion.

Even someone widely acknowledged as not the sharpest arrow in the quiver should have caught the manifest absurdity of the characterisation, in his own Introduction to the Survey, of opium as "... the world’s deadliest drug...". As regards deadliness, opium and its derivatives isn't a patch on tobacco and alcohol.

Mr. Costa’s most accurate reported statement is "The Afghan opium situation looks grim, but it is not yet hopeless,"; this statement is half right: the Afghan opium situation is both grim and hopeless. He goes on to say: "Where anti-government forces reign, poppies flourish," a correct statement of the observed statistical association between poppy production and the degree of Taliban control in Afghanistan since Taliban’s de-facto rule over the country was ended by the US-led Allied troops almost six years ago.

As a (former) social scientist, Mr. Costa must be aware of the pitfalls associated with the causal interpretation of a statistical association between two phenomena, A and B, say. The statistical association could mean that A causes B, that B causes A, that A and B are interdependent, or that some third factor (or set of phenomena), C, say, is driving (causes) both A and B, without either A influencing B or B influencing A – the ‘common third factor’ interpretation.[1]

Mr. Costa, however, has no doubt; as far as he is concerned, Taliban control of an area causes poppy cultivation to expand in that area. The fact that when the Taliban controlled all of the country, poppy cultivation was almost wiped out, is conveniently forgotten. The Report’s policy recommendation that tackling the Taliban insurgency is key to stemming opium cultivation misses the point completely. Key to tackling the Taliban insurgency is the legalisation of the production, sale and consumption of poppy and its currently illegal derivatives, opium and heroin. This will deprive the Taliban both of political support from farmers who see their livelihoods destroyed or threatened by the Allies’ eradication efforts, and of a ready-made tax and extortion base.

Let me expand slightly: there is indeed a third ‘common (set of) factor(s)’ at work here: the main one is the fact that poppy cultivation and the production, sale and consumption of poppy derivatives such as opium and heroine are illegal almost everywhere. US anti-drugs policy, driven by a bizarre mixture of mindless moralising and complete idiocy and inability to learn from repeated abject failure, is especially vehement, ruthless (at home and abroad) and ineffective. The US government is both the leading opponent of the Taliban and the world’s leading proponent of eradication of drugs ranging from poppy derivatives to coca and cannabis. Poppy cultivation for the illegal market in Afghanistan is more profitable for many local farmers than any other realistically cultivable crop. Attempts by the US, its allies and the Karzai government to eradicate the cultivation of poppy destroy political support for the government and increases support for the Taliban, which can offer protection to illegal poppy growers. The Taliban then tax the poppy crop and the growing share of the opium production that takes place in inside Afghanistan.

The case for legalising currently illegal drugs like opium, heroin, cocaine, and various cannabis derivatives can be made on both utilitarian and libertarian grounds. The utilitarian case has recently been effectively restated by Ethan Nadelmann, in the September/October issue of Foreign Policy. The website of the Drug Policy Alliance, of which Mr. Nadelmann is founder and Executive Director, contains useful statistics, arguments, and information about drug policies worldwide. The resurgence of the odious Taliban in Afghanistan, the illegal drug-related violence and corruption of politics in Columbia and Mexico, Peru, Bolivia and Morocco are a direct result of the criminalisation of drug use.

US anti-drugs policy is not only causing massive harm domestically, it is destroying countries that most Americans have never even visited. Whenever the Taliban extends its control over another city or province, and their barbaric suppression of women and general cult of ignorance destroys the human dignity of yet another generation of Aghanistanis, the anti-drugs Czar (the Director of the White House Office of National Drug Control Policy (ONDCP), currently John P. Walters) and his boss in the White House can take a large share of the credit. Those whom the Gods wish to destroy, they first make mad.

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[1] There could also be a common third factor, C, as well as interdependence between A and B.

© Willem H. Buiter 2007

Trouble in the home of Tolerance

Two news bulletins from the Low Countries:

First, Ehsan Jami, a Dutch local authority councilor for the Labour party, of Iranian origin, announced a few months ago that he was creating a Committee for Ex-Muslims. Since then has been beaten up by islamist thugs and has received dozens of threatening phone calls. His life has been threatened, Islamic prayers have been screamed down his phone line as well as many an 'Allahu Akbar.'

Second, Geert Wilders, Chair of the Dutch party PVV (Partij voor de Vrijheid - Party for Liberty) wants to have the Quran banned in the Netherlands. His reasons are that the Quran calls for the death of those guilty of apostasy, blasphemy, homosexuality and pre-marital or extra-marital sex, condones slavery, supports the subordination of women, and asserts the superiority of Islam over any other religion and accordingly assigns greater rights to Muslims than to non-Muslims.

There are times that losing my Dutch passport because I voluntarily took on another nationality is distinctly less bothersome. The day I read these two news items was one of those days.

Mr Wilders and the thugs that beat up and persecute Ehsan Jami deserve each other. It is clearly of the utmost importance that those who treasury liberty and an open society be aware of just what they are up against when confronted with Islamic fundamentalism and islamist fanatics.

Apostasy in Islam (the rejection of Islam in word or deed by a person who has been a Muslim) is, according to Sharia law, punishable by death. All five major schools of Islamic jurisprudence agree that a sane male apostate must be executed. The fatwahs targeting Salman Rushdie were therefore fully consistent with the prevailing interpretations of Sharia law. A female apostate should be put to death, according to some schools, or imprisoned, according to others. Whether this contrasting treatment of the female and the male is good news or bad news, I leave as an exercise for the reader. (For that matter, proseletyzing targeted at Muslims is likewise forbidden by Sharia law; punishments vary according to the legal and cultural traditions but can include death for the would-be missionaries.)

Blasphemy, according to Sharia law, is also punishable by death or exile: "... execution, or crucifixion, or the cutting off of hands and feet from opposite sides, or exile from the land: that is their disgrace in this world, and a heavy punishment is theirs in the Hereafter;”[Surah Al-Maidah 5:33]). The assassination of the Dutch cineast Theo van Gogh by an islamist fanatic was justfified on the grounds of van Gogh's blasphemous work, including his film Submission.

The Islamic view of apostasy is clearly incompatible with western views of human rights and religious freedom. No compromise is possible. People must have the right to change their religion as often as they change their underwear. To observe any religion or none is a fundamental human right. End of story.

Blasphemy laws still survive in various forms in some western countries, although the penalties fall short of what Sharia law demands. All blasphemy laws should be relegated to the scrap heap of history, together with any lèse majesté laws that may survive.

Homosexuality is a sin according to Islam; according to fundamentalist Islam, it is punishable by death. Extra-marital and pre-marital sex can be punishable by imprisonment, corporal punishment or death. This intolerant barbarism is not acceptable and must be fought. Of course, the same intolerant views can be found in the Christian bible and in the Hebrew Scriptures.

It is true that the Quran condones slavery and supports and mandates the subordination of women. So do the Bible and the Hebrew Scriptures. A very clear statement of the common roots of female subordination in Judaism, Christianity and Islam by the Egyptian feminist Dr. Nawal Saadawi (1990) : "the most restrictive elements towards women can be found first in Judaism in the Old Testament then in Christianity and then in the Quran",..., "all religions are patriarchal because they stem from patriarchal societies" and "veiling of women is not a specifically Islamic practice but an ancient cultural heritage with analogies in sister religions".

It is not the Quran, or the Bible or the Hebrew Scriptures that are dangerous and should be banned. The danger comes from a fundamentalist, literalist reading of selected passages of these bewildering, complex and contradictory writings. Most modern Christians and Jews (and many modern Muslims) recognise that the time and place of their holy books' creation deeply influenced, constrained and at times distorted the manner in which these books' authors or chroniclers expressed themselves. The message needs to be constantly adapted and adjusted to remain relevant to changing times and circumstances, and indeed to remain true. Believers also tend to subscribe to the view that there is a deep core of the divine message that is unvarying - permanent. But that essence need not even be expressed in any of the exact words or phrases found in the holy books.

Fundamentalism is a curse, no matter which religion it infects. Fortunately, Christian fundamentalism and Judaic fundamentalism are less of a political force today than they used to be in days gone by. They are not completely irrelevant, unfortunately. Christian fundamentalism has poisoned the Republican Party in the US and polarised US political life at home and abroad since the days of Reagan. Jewish fundamentalism has a destructive influence quite disproportionate to its small numbers in the state of Israel.

No doubt Islam will evolve, given enough time, towards a less fundamentalist interpretation of the faith and its core writings - the Quran and the Hadith. God gave the same brains to Muslims, Christians and Jews; it just so happened that Islam emerged more than six centuries after Christianity and some 29 centuries after Judaism; one might therefore expect Islam to still need a few more centuries to work out some of the teething problems of becoming a religion fit for an emancipated, educated humanity. Actually, six centuries ago, Christianity was in its Ferdinand and Isabella phase - something much closer in spirit, practice and level of violence to the role of religion held by today's islamist fanatics, and inferior in most ways to the enlightened Islam of El Andalus and the Ottoman Empire. The scientific, scholarly, indeed secular approach to sacred texts like the Quran was pioneered in the 12th century by the great Arab philosopher - physician - mathematician - scientist Ibn Rushd, known as Averroes. It's been a long road downhill from Ibn Rushd, and even today it is hard to see the shoots of an intellectual, cultural and enlightened religious revival in the Islamic world. The struggle against fanaticism, intolerance, fear, hate, the worship of suicide, the glorification of mass-murder and the underlying cult of nihilism, death and destruction has only just begun. I doubt even my teenage children will live to see the end of it, even if they achieve their Biblical entitlement of three score and ten. But banning the Quran? What a stupid, destructive, trust-destroying publicity stunt to even suggest it. Why not ban the Bible as well. And the Gita. And Harry Potter.

Do we need Private Equity Funds to tackle X-inefficiency and organisational slack in fat-cat universities?

Harvard University has an endowment of about $ 30 bn. Yale follows with around $18 bn. Then Stanford with out $14 bn and Princeton with about $13 bn. Cambridge University (including the colleges) probably has an endowment of about $3 or $ 4 bn (a surprisingly large chunk of which is owned by Trinity College). Is this money well used? Does Harvard’s endowment produce eight to ten times more academic value added than Cambridge’s endowment? Whose money is it legally and who are the de facto 'beneficial owners'?

I’ll leave it to the lawyers to determine who the legal owner(s) is (are). It’s pretty clear who the principal beneficial owners are: current and future faculty. With future faculty selected by current faculty – we have a classic example of a self-perpetuating oligarchy.

The formal legal status of universities differs; I am considering here mainly those that have de-facto charitable status, like all the leading private American universities. In the UK, universities and Oxbridge colleges are charitable foundations.

Let’s characterise the official, mandated purpose of these institutions of higher learning as maximizing the present discounted value of teaching and scholarship (research) or PTR over an infinite horizon. As in most organisations, there is a principal-agent (or trustee/beneficiary) problem inherent in the way universities are run.

Universities like Harvard, Yale, Stanford, Princeton, Cambridge and many others, are basically run like worker-managed firms (the old Yugoslav model), with an infinite horizon (the workers cannot liquidate the business and divide the profits among themselves). These agents, even when they care about the mandate of the institution they manage and control (the maximisation of the PTR) have additional, and potentially conflicting, selfish objectives: status, creature comforts, power, prestige, income, etc. We know from the theoretical and empirical literature of worker-managed firms that they tend to pamper the incumbent workforce (paying them their average product rather than their marginal product, in the simplest example). If there is a seniority system, and the incumbents control the hiring process (and the firing of the non-tenured) , the pampering and privileges of the senior incumbents (the tenured faculty) can be massive.

Not only do universities provide significant rents and creature comforts to their beneficial owners, I would conjecture that in addition, even allowing for the complexity of their products and production processes, universities are woefully badly managed. It is still extremely difficult to bring in professional managers. Within universities, those who can, do research, those who cannot, teach and those who cannot even do that, do administration. Managing academics is like herding cats. Academics are not selected for their maturity, leadership capabilities and teamwork. Universities are a classic example of an under-performing industry.

There are some competitive spurs to efficiency in the university sector – there are new entrants, at home and abroad, and some universities (not enough, unfortunately) go broke and disappear - but the capacity for an outsider to come in, reorganise and restructure the assets of under-performing fat cat universities (UFCUs) is effectively non-existent, unless the institution is about to go broke. The weeding out of the woeful therefore proceeds far too slowly, especially when the woeful are the best but still not as good as they could and ought to be.

Assume that the leading private American universities are listed and traded on the ICP (the Intellectual Capital Market) and that what is priced and traded on this market are shares in the PTR. There is a large population of investors out there who value teaching and research. Assume also that, whatever happens to the individual academic institutions, the resources of the existing universities can only be used for the same purpose: the maximisation of the PTR.

It is my conjecture that before you could say ‘academic freedom’, private equity funds would have snapped up most of the UFCUs, fired most of the labour force, sold most of the assets, and started again with a quite different ownership and control structure.

Tintin: racism vs. freedom of speech

Mr. Mbutu Mondondo Bienvenu is not extending his bienvenu to ‘Tintin in Africa’/’Tintin in the Congo’, a strip cartoon story written as a serial in a periodical in 1930 and first published as a book in 1931. He is quoted as saying "I want to put an end to sales of this cartoon book in shops, both for children and for adults. It's racist and it is filled with colonial-era propaganda”. Mr. Bienvenu, a Congolese student from the Democratic Republic of Congo, has launched legal action in Belgium to have ‘Tintin in the Congo’ declared racist and removed from bookstores.

Is the book racist? It shows black Africans as stereotypical 1930s-style black characters and whites as their colonial masters. When I read it as a boy in Belgium in the late 1950s, I had to sneak it past my parents, who disapproved of cartoon books in general (books should have words, not pictures) and to Tintin in Africa in Africa specifically, because they considered it racist (even then!). So yes, the book is racist.

Should it be banned from bookstores because it is racist? Certainly not. Making the expression of racist opinions illegal is an unacceptable infringement of free speech.

Mr. Mondondo would certainly have been within his rights if he had decided to demonstrate peacefully outside bookstores stocking the offending ‘Tintin’ volume. He could have written letters to the editor calling for readers not to buy the book, he could have blogged about it, and could have tried to organise a consumer boycott of the book in any number of legitimate ways. To appeal to the law to have the book banned is both lazy and wrong.

In a world teeming with excuses for infringing on the right to say what you think, when you think it and where you think it, the inalienable right to freedom of expression must be reasserted and defended ceaselessly. Lest someone tries to be cute about this, I will recognise up front the usual exceptions: (1) it should not be legal to shout ‘house’ in a crowded fire; (2) speech directly inciting or encouraging acts of physical violence towards persons or groups, or acts of destruction towards the property of such persons or groups is not protected; (3) libel and slander should be illegal, but with a serious burden of proof on the offended party; (4) deliberately misleading advertising is not protected free speech (but again with a serious burden of proof caveat). However, 'fighting words' are protected free speech. Not being provoked by them is part of being a grown-up.

However, equating verbal insults with physical violence just does not wash. Clearly, children (all those under age) should be legally protected against extreme verbal abuse and verbal assault. As regards communications between independent adults, limits on what is permissible are set by good manners and social norms, not by the law. If the adults are in an inherently unequal relationship (superior-subordinate in an employment relationship, for instance), other constraints on permissible language may of course apply. In private settings, and in societies with elective membership, clubs and associations, people can be expelled or ostracized for having views unacceptable to the group. In the public domain, no such constraints should apply. It is not the responsibility of the state to enforce good manners.

The key distinction is between the private and the public spheres. I reserve the right to boot out of my home anyone making racist comments or indeed any other comments that offend me deeply. But in the public domain - in publications, on soapboxes located on street corners, in the print and electronic media, in blogs and elsewhere - these views have a right to be uttered, repulsive and repugnant as they are. You fight offensive and hurtful views in a variety of ways. Sometimes ignoring them is effective. This is unlikely to be the right approach with racism. Racism must be exposed, criticised, refuted, rejected publicly, made to look like what it is: stupid and/or evil bigotry and prejudice. But do not ban the expression of racist views. It is effective and it is wrong because it restricts that most precious and fragile of freedoms: the freedom to speak your mind, regardless of whether others agree with your views or are horrified and upset by them.

Freedom of speech and of expression must be defended even when the speech that is defended is loathsome and repugnant. We measure our commitment to freedom of speech by the degree to which racist, sexist and ageist statements get the same treatment as Methodist statements.

This defense of people’s right to speak and write the indefensible, extends also to the great taboos of modern history, including the Holocaust.

Holocaust denial is a crime in Austria and Germany and there are proposals afoot for making it a crime across the EU. It is a sick irony that the two democratic successor states of Nazi Germany, the German Federal Republic and Austria, both responded, when confronted with the expression of views they deemed unacceptable, by using the same instrument - criminalisation of the expression of these views - that would have been the reflex choice of the Nazi regime, and indeed of totalitarian regimes throughout history.

I consider anyone who denies the historical reality of the Holocaust to be either insane, terminally ignorant and stupid or deeply evil – or some combination of these three. President Ahmedinejad of Iran is but the latest in a long line of pathetic, twisted and evil souls who choose to use Holocaust denial as a rallying call for the anti-Jewish barbarians all over the world. But the response to an outrageous, ugly, deeply offensive and horribly hurtful view or opinion, including Holocaust denial, is not to make the expression of that view or opinion a crime. It is to stand up and shout out a refutation of these views. The notion that history can be legislated and that the correct version of history can be enforced in a court of law would have come naturally to the Nazis and to Stalin or Mao. It has no place in a free society.

There is no fundamental human right not to be offended. Those countries that have criminalised the expression of certain views and opinions merely because they are deemed incorrect, deeply offensive and hurtful should rethink this unacceptable encroachment on freedom of expression.

Down with the Olympics!

Who besides me hates the Olympic games? Every two years my senses and sensibilities are assaulted by an eruption of national chauvinist excess dressed up as a summer or winter sports competition. The national medal count bug not only infects the totalitarian steroid-enhanced, chromosome-augmented and blood-enriched athletic nations like the DDR, Bulgaria, the USSR and the PRC, but also the democratic steroid-enhanced, chromosome-augmented and blood-enriched athletic nations like the USA. My exposure to the absurdity of the Olympics came with the 1964 Tokyo Olympics. I lived in Belgium at the time, and read the French weekly Paris Match on a regular basis. For a while it looked as though France would not win a single gold medal in the Tokyo Games. Sack cloth and ashes all over Paris Match. Then horse power came to the rescue: Pierre Jonquères d'Oriola won a gold medal in the individual showjumping event. Paris Match went nuts and devoted half of an issue to d'Oriola and his blooming horse, Lutteur B (which was Anglo-Norman and therefore not even French!). Sad, sad, sad. I was in the process of moving back to the USA in 1984 when I was exposed to the full chauvinistic hype and dementia of the Los Angeles games. By the time Atlanta rolled around i 1996, I was fortunate to be living in London, far enough from the madding crowd not to get another case of the Olympic hives. Much to my chagrin, London has 'won' the right to stage the 2012 Summer Olympics. At least the odds are low that British athletes will win more than a few medals (and most of those in strange sports nobody else competes in). There should therefore not be too many medal-induced jingoistic eruptions. Huge amounts of money will be wasted on sports facilities that will be underutilized as soon as the games are over. Even larger amounts of money will be wasted on inappropriate infrastructure. Not all hope is lost, however. There is a chance that the 2008 Beijing summer Olympics could a debacle on a scale sufficient to kill off the Olympics for another millennium and a half. Just imagine the scene. Every free-Tibet NGO, every save-the-Uigur activist, remember-Tiananmen-Square militant, Falun Gong would-be martyr, activist-against-Chinese-neo-colonialism-in-Africa and devotee of environmental sustainability will be converging on and congregating in Beijing. If the authorities let them do their thing, the domestic political consequences could be spectacular (and the Games could be seriously disrupted). If the authorities use Tiananmen-square lite tactics, there could be walk-outs from the Games. There is hope for those who hate the Games.