Friday, 4 September 2015

Vinaashkaale Vipreet Buddhi
 When Pompey the great, the renowned Roman general, went with his army to a town in Sicily, the citizens there objected to his jurisdiction on the ground that it was against an ancient law of Rome.
To which Pompey replied "Don't quote the law to us, we carry swords "
 The Govt. of India should remember this quote while dealing with ex-servicemen and their demand for OROP.
 The ex servicemen have softened their stand by agreeing to a revision of pension every two years, instead of annually, as previously demanded. This was in fact a good gesture by the ex servicemen as it would give a face saving device to the Govt. But surely they cannot accept a 5 yearly revision, which, as rightly pointed out by Maj. Gen. Satbir Singh, would mean one rank 5 pensions.
 The Govt. should accept this and end this 3 month old agitation quickly, for they are playing with fire.
 This agitation is different from other agitations, e.g. the Patel agitation in Gujrat. The ex servicemen may have retired, but their plight is bound to give ideas to the serving soldiers, who too will one day retire.
 The Govt. will be well advised to now accept the OROP demand with 2 year revision of pension and 2014 as the base year.
 I have already quoted Chanakya's advice to Emperor Chandragupta Maurya in a previous post. If sense does not prevail now in the heads of the Govt. leaders it will be a case of ' Vinaashkale Vipreet Buddhi ", They may then  be well inviting a Cromwell, and then they themselves will be to blame.

Thursday, 3 September 2015

A twitter conversation I had with a lady yesterday

Subhadra : Women are attracted towards men with a sense of humour. Yup, rich, tall,dark, handsome men having full hair on head with sense of humour
Markandey Katju : Rich is the only requirement, Subhadra. All others are superfluous
Subhadra : Don't agree sir
Markandey Katju : Have you heard of the quote of Thomas Edward Brown '' A rich man's jokes are always funny ? "

Now do you ladies reading this post agree with me or Subhadra

Wednesday, 2 September 2015

The Allahabad High Court order directing the national flag to be hoisted in all madarsas in U.P. on 15th August and 26th January, is like the Biblical ' peace of God, which passeth all understanding ' ( Phillipians 4:7 ).
If there was a law requiring this, judges can certainly enforce it. But where is that law ?
 Judges should know their limits, and not behave like Emperors, as held by the Supreme Court in Divisional Manager, Aravali Golf Course vs. Chander Haas ( see online )
Explanation of the present economic crisis
In my previous post I have written generally of the causes of economic crises in the world. Now let me talk of the present economic crisis in particular.
 Economists with high sounding degrees from Harvard, Yale, London School of Economics, etc have made economics a mysterious subject. But it is not so. Let me therefore explain the present crisis step by step:
1. The present crisis is due to slow down in manufacturing production in China. But why is there a slow down in production there ?
2. The Chinese economy is largely export oriented. The slowdown in production in China is because of reduction in exports. But why is there a reduction in exports from China ?
3. The reduction in exports from China is because there is reduction in demand mainly from North America and Europe, where most of the exports go. But why is there a reduction of demand there ?
4. That is because of recession in the Western countries and consequent increase of unemployment there. But why is there a recession in Western countries and increase in unemployment ?
5. That has been explained in detail in the previous post. To face the competition in the market and survive, industries have to become more and more capital intensive, rather than labour intensive, to reduce labour costs.
 Cost of labour is a big chunk of the total cost of production, and so by becoming capital intensive ( by introducing new labour saving technology ) industrialists reduce their cost of labour, and thereby their cost of production. Even though they may have to pay interest on the loans taken from banks to buy the new machinery, this cost is far less than the saving in labour costs by laying off workers.
 If an industry does not do this ( introduce capital intensive machinery ) its rival will do it and reduce its labour costs, and thereby its cost of production, and eliminate the former by underselling it. So every industry must do it to survive. But in the process it is generating widespread unemployment..
6..As explained in the previous post, the worker is not only a producer he is also a consumer. A steel worker does not consume steel, but he and his family consume food, clothing, shoes, and a host of other articles. If he loses his job he has to drastically reduce his consumption. He will now buy only essentials like food and medicines ( to survive ) but he stops buying most industrial goods.
7. This reduction in spending leads to reduction in sales, which in turn leads to recession
8. The solution to the problem is therefore to increase the purchasing power of the masses. There is no difficulty in increasing production, but how will the goods produced be sold when most people do not have the money to buy ?
The French economist Jean Baptiste Say propounded his well known ' Say's Law ' which says that production will find its own demand, and Adam Smith in his ' The Wealth of Nations ' spoke of ' the invisible hand ' which will lead to unending progress.. But subsequent developments, particularly the Great Depression from 1929 to 1939 have proved these theories false
  Hence the only true solution is to raise the purchasing power of the masses.How to do it ? This is the problem to which all serious thinkers must now apply their minds
http://timesofindia.indiatimes.com/business/international-business/China-economic-slowdown-World-markets-plunge-on-fears-of-weaker-global-growth/articleshow/48763468.cms

The World Economic Recession
For quite some time there has been an economic recession all over the world. From time to time we hear of a recovery, but in fact there has not been, and there is unlikely to be, a genuine recovery of the world economy for a long time. I will try to explain.
An economic recession is a feature of an industrial, not agrarian economy. In agrarian economies, too, there were catastrophies, but these were due to natural calamities like drought, epidemics, etc. An economic recession is a feature peculiar to industrial economies.

There have been recessions every eight or ten years ever since the Industrial Revolution of the 18th Century in Western Europe. These, however, were followed shortly thereafter by recoveries. But there has been one Great Depression which lasted from 1929 to 1939, and was ended only by the Second World War (in which 50 million lives were lost) which generated the massive demand for armaments, supplies to armies and war affected civilian populations, and capital for reconstruction, etc. This Great Depression caused havoc in large parts of the globe, particularly in the developed countries.

We are now witnessing a persistent, and apparently unending, world economic recession, and its sweep is wider than that of the Depression of 1929, because while the latter affected mainly North America and Europe, the former is affecting the whole world, because while before the Second World War ( 1939-1945 ) many countries ( including India ) were largely unindustrialized, there has been a certain level of industrialization in most countries since then.

WHAT IS THE CAUSE OF SUCH ECONOMIC RECESSION OR DEPRESSION?

The principal cause of an economic recession (or depression) is lack of sales, which in turn is due to lack of purchasing power in the masses. There are other causes also, but these are only incidental, and not the main cause.

A large part of the world’s population is so poor that it hardly has sufficient purchasing power. Even in the developed countries there are many poor people.

Apart from the above, as the industrial economy develops, in the process industries tend to become larger and larger, to effect economy of scale, and more and more capital intensive ( that is, labour being replaced by machinery ). This is necessary for industries to face the competition in the market, otherwise their rivals will become larger and more capital intensive and drive them out of the market, by underselling them. This process is inevitable in most industries, but it leads to large scale unemployment, since many workers in a labor intensive industry are laid off when it becomes capital intensive. This generates unemployment.

Let me explain. There is competition between businessmen in the market. Let us take a simple illustration. Suppose A has a shop selling a loaf of bread for Rs.20. Next to his shop is the shop of B selling the same size and quality loaf for Rs. 18. What will happen ? The customers of A will gradually leave him and become the customers of B, and B will eliminate A by underselling him. Thus one businessman eliminates another not by tanks, guns or bombs but by underselling him.
Now the same thing happens on the national and even international level.

To reduce his sale price a businessman has to grow larger ( to effect economy of scale ) and to introduce new technology. This is because cost of labour is a big chunk of the total cost of production. So if the cost of labour is less, the cost of production is less, and if the cost of production is less, the businessman can sell at a cheaper price, and thus eliminate his business rival.. By introducing new and labour saving technology in his plant, the businessman can cut down his labour costs, and thereby his cost of production.

Suppose a manufacturer had 500 workers working in his plant. With the advance of technology he may get a new machinery which requires only 100 workers to produce the same amount of goods which he was producing earlier. This means 400 workers will become unemployed. Even if 100 of these 400 workers can get jobs elsewhere this still leaves 300 workers unemployed. When we enlarge our scene (because the same process is inevitable in most industries) we find large scale unemployment is being generated everywhere.

Now the worker, apart from being a producer, is also a consumer. Of course a worker in a steel factory does not consume steel. But he and his family consume food, clothes, shoes and various other articles. When he becomes unemployed his purchasing power becomes drastically reduced. And when unemployment is generated on a large scale, the market correspondingly contracts on a large scale, and this leads to a recession.

Thus we see that the very dynamics of an unregulated industrial economy is that by the very inevitable process of its growth it keeps destroying its market.

The goods produced have to be sold. But how can they be sold when people have lost their purchasing power (due to widespread unemployment)?

Mass production has to be accompanied by mass consumption. By taking purchasing power out of the hands of mass consumers the industrialists deny to themselves the effective demand for their products that would justify reinvestment of their capital accumulation in new plants (which would also provide employment ).

Before the Great Depression of 1929 high level of employment was generated by high level of debt in the form of mortgage debts (for housing etc.), loans to buy cars and other consumer goods, brokers loans (for buying shares, etc.). The same thing happened in recent times. But this cannot continue endlessly. A time comes when people cannot repay their debts (due to unemployment or cut in real wages). Then debtors curtail their consumption, which reduces demand, and the producing units have to close down or drastically cut production.

In modern economies, most businesses require loans for their normal operations. Banks normally retain a small fraction of their deposits (5% or less) and give the rest as loans to borrowers. When the banking sector does not work properly (because of defaults by loanees) businesses do not easily get loans, and consequently they have to curtail their production and lay off workers. As they curtail production they require less raw materials and other supplies. Hence their suppliers have to reduce their output and lay off their workers. The suppliers to these suppliers have to do the same.Thus, this can set off a chain reaction.

If manufacturers cannot sell they cannot generate enough revenue to repay their loans. The business goes bankrupt and the bank finds in its hand non performing assets. Hence banks want to lend less. This becomes a vicious cycle.

Depositors get scared because some banks have collapsed due to the non performing assets. Hence they start withdrawing their money, and more banks collapse.

The economic recession is thus caused by the reduction of purchasing power in the masses which is due to the very dynamics of unregulated growth. The productive capacity has been enhanced enormously, but the vast majority of people are too poor to buy.

The problem, therefore, is not how to increase production, but how to increase the purchasing power of the masses. Production can be increased easily several times because there are tens of thousands of engineers, technicians, etc., and there are immense reserves of raw materials in India. But the goods produced have to be sold, and how can they be sold when the people are poor or unemployed, and thus have very little purchasing power?

The problem is also not how to increase demand. The demand is there, but people do not have the money for purchasing goods. In India, for instance, 75% people live on bare subsistence incomes. This may not even be sufficient for buying necessities, like food or medicines, what to say of durable consumer goods like motor cars, refrigerators, computers, air conditioners and other goods.

The solution to the economic crisis can only be by raising the purchasing power of the masses. How this is to be done requires a great deal of discussion and creative thinking , and all serious thinkers must now address this main problem facing our country, and indeed the whole world.

The situation in India today is that while we have recently increased the number of billionaires in our country, the poor have become poorer and even the middle class is finding it difficult to make two ends meet because of rising prices. This is a dangerous trend and if continued is going to lead to widespread social turmoil and social unrest. It is totally unfair to the vast masses of our people and it will not be tolerated very long.

Society owes subsistence to all its citizens either in procuring work for them on a reasonable wage, or in ensuring a livelihood to those who are unable to work.

As stated by the great French thinker Rousseau in his book 'Discourse on Inequality' : “Nothing can be farther from the law of nature,however we define it, than that a handful of people be gorged with luxuries, while the starving multitude lacks the necessities of life.”

Unfortunately, most people are silent about this terrible plight of our people because those who should be speaking out are mostly beneficiaries of the present system, and hence do not want to disturb it.
It is time now that the patriotic intellectuals speak out on these issues.
Posted by Justice Markandey Katju at Sunday, November 23, 2014

Monday, 31 August 2015

Tigers don't live forever
In this age of transition those who combat feudal ideas and practices and superstitions, and propagate rationalism and free thinking,  are in danger of being attacked and even  killed.
 Bloggers killed in Bangladesh, Prof. Kalburgi killed in August 2015, Dr. Narendra Dabholkar killed in August 2013, Govind Phansare killed in February 2012, etc.
 I too am consistently combating feudal ideas and customs, and superstitions, and am consistently propagating rationalism and scientific thinking.
 There are dangers involved in this, but how does that matter ?
 Tigers don't live forever.

Saturday, 29 August 2015

29.8.2015
 I received a lot of rakhis today from my sisters and cousin sisters.
 But the most treasured one was from a Muslim lady who regards me as her brother.
 When I was a lawyer in Allahabad High Court among my close friends was Afsar Ali, advocate in the High Court. He was elder to me by a few years. He had married late in life, and had 4 small children ( 3 daughters and a son )..
 Every year on Eid he would invite a group of 4 or 5 friends to his house in Daryabad for dinner. He was a conservative Muslim, and we never saw his wife as long as he was alive, as she was in purdah. But she used to prepare delicious non vegetarian dishes for us.
 I became a Judge of the High Court in 1991, and a couple of years after that Afsar Ali died. His widow sent me a message that she wanted to meet me, and I requested her to come to my residence. There she told me that her brothers in Rampur had asked her to come there with her children, and live there.
 I told her that she should not shift to Rampur, as after some time she would not be welcome there. I said that she had her home in Allahabad, and she should remain here, and I would get her a job in the Allahabad High Court, so that she may be able to have an income to feed her children. However, I told her that she must give up her purdah now, as she would have to fight it out in the outside world, from which she had been till now largely isolated.
 Accordingly i got her appointed on a class 3 ( clerical ) post, and I told the Registrar General to post her in the High Court library, where the work was lighter, and she could go home early. This enabled her to support her family, which she did
 All this happened over 20 years ago, but every year since then on rakshabandhan day she has been regularly sending me rakhi, and also coming personally to tie it on my hands whenever she could. The written message to me every year ( with the rakhi ) says '' Apne bhai ka farz nibhaya ''
 Now all her 4 children are grown up and well settled. She has several grandchildren.
 Today she came all the way from Allahabad to tie rakhi personally on my hand.
 She told me that she has now become a bench secretary in the High Court, and earns over 50,000 rupees a month
This was Chanakya' advice to Emperor Chandragupta. The Govt. of India should think about this carefully in relation to the demand of OROP

 “Pataliputra reposes each night in peaceful comfort, O King, secure in the belief that the distant borders of Magadha are inviolate and the interiors are safe and secure, thanks only to the Mauryan Army standing vigil with naked swords and eyes peeled for action, day and night, in weather fair and foul, all eight praharas (i.e.round the clock), quite unmindful of personal discomfort and hardship, all through the year, year after year.

            “While the citizenry of the State contributes to see that the State prospers and flourishes, the soldier guarantees it continues to EXIST as a State! To this man, O Rajadhiraja, you owe a debt: please, therefore, see to it, on your own, that the soldier continuously gets his dues in every form and respect, be they his needs or his wants, for he is not likely to ask for them himself.”

            Then Kautilya, known also as Chanakya gave his king this blunt warning: “The day the soldier has to demand his dues will be a sad day for Magadha for then, on that day, you will have lost all moral sanction to be King!”
Aurangzeb
Almost all Muslim rulers in India were secular. This they were in their own interest, for the vast majority of their subjects were Hindus. So if they persecuted Hindus there would be revolts and turbulences regularly, which no ruler wants.

Thus, the Mughals, Nawabs of Avadh and Murshidabad, Tipu Sultan, Nizam of Hyderabad etc were almost all thoroughly secular. For instance, the Nawabs of Avadh used to celebrate Holi, Dussehra and Diwali, organize Ramlilas, etc and give respect to all religions. Tipu Sultan used to give annual grants to 156 Hindu temples ( see online ''History in the Service of Imperialism by B.N. Pande'' ).

Akbar used to hold discussions with people of all religions, and give them respect (see my judgment in Hinsa Virodhak Sangh vs.Mirzapur Moti Koresh Jamaat online and 'Akbarnama').He propounded and practised the policy of Suleh-e-Kul, i.e. Universal Toleration of all religions ( at a time when Europeans were massacring each other in the name of religion ). His son Jehangir used to regularly meet the Hindu sadhu Jadrup, and hold discussions with him ( see 'Jehangirnama').
The controversy is about Aurangzeb. I discussed about him with many Professors of history in Aligarh Muslim University and Allahabad University. Strangely enough, The Professors of AMU with whom I discussed Aurangzeb, and who are Muslims, regard Aurangzeb as communal, while the Professors of Allahabad University, who are Hindus, regard him as secular. Which is the correct view ?

My own view is that more research is required.

On the one hand there is evidence to show that in Aurangzeb's time grants were given to several Hindu temples, e.g. Mahakal temple at Ujjain, the Chitrakoot temple, etc.( see online 'History in the Service of Imperialism', which is a speech given in the Rajya Sabha by Dr. B.N. Pandey, former Professor of History of Allahabad University and Governor of Orissa ). Details of the grants to Hindu temples in Aurangzeb'e reign can be seen there. Many of Aurangzeb's army commander's e.g. Raja Jai Singh were Hindus.

I had been to Bikaner a few years back. A part of the Maharaja's palace has been converted into a museum. I went to that museum and saw there a letter by Aurangzeb to the new Maharaja of Bikaner, who was a young man whose father (the previous Maharaja) had just died. Aurangzeb writes to the young Maharaja consoling him, and said that he could understand the loss of one's father. He concludes the letter saying that the young Maharaja should regard Aurangzeb as his own father, and if he needed anything he had only to inform Aurangzeb.

Now the point is that if Aurangzeb hated all Hindus would he have written such a letter ?

On the other hand, the fact cannot be denied that Aurangzeb reimposed jeziya on Hindus, a tax which his great grandfather Akbar had revoked. When I mentioned this to the Allahabad University Professors ( with whom I discussed Aurangzeb) they said that Aurangzeb needed money for his wars. Now if Aurangzeb needed money for his wars he should have imposed a tax on everyone, why only Hindus ?

The charge against Aurangzeb is that he demolished several Hindu temples e.g. the original Kashi Vishwanath temple, which is now the Gyanvapi mosque, standing next to the present temple built in the 18th Century by Maharani Ahilyabai Holkar. In fact the rear wall of the Gyanvapi mosque has Hindu carvings, which are clearly discernible.

Which is therefore the true Aurangzeb ?

My own view is that he was somewhere in between, but more research is required. While he was a very honest man earning his living by making caps, he also had some bigotry in him, which was a departure from the policy of his forefathers, and because of this bigotry he antagonized many Rajputs,  Marathas, Sikhs, etc which hastened the demise of the Mughal Empire.

. After his death in 1707 within a few years the Mughal Empire's size was reduced to Delhi and its suburbs only ( ' Saltanat-e-Shah Alam, Az Dilli ta Palam').

Though Aurangzeb was a totally honest man ( he earned his living by making caps), he seemed to lack the great quality which Akbar had, of accomodating everyone and pursuing a tolerant and flexible, instead of rigid policy. Akbar realized that India is a country of great diversity, and so only a tolerant, flexible and accomodating policy can keep the Empire together. This realization, evidently, Aurangzeb lacked.

However , this is only my tentative opinion, and more objective research is required by experts

Tuesday, 25 August 2015

The Chinese Humpty Dumpty is having a great fall

I have always been of the view that the Chinese economy is bound to collapse, because it is totally export oriented, and the leaders care two hoots for the welfare of their owna people. While the east coast is shining, there is massive poverty in the interior of China, as many people who have gone there have told me.

 To be stable, an economy must mainly depend and be based on the domestic market. This is because dependence on  foreign markets is very precarious. The foreign market may be captured by another country, or there may be a recession in the foreign country, which causes sales there to drop, and this in turn results in closure of the domestic industries.

 The Chinese leaders had forgotten the welfare of their own people, and like Uncle Scrooge or Shylock were only interested in making dollars by exports of their products. Most of these leaders have become corrupt, and have been transferring their ill gotten gains abroad, usually by buying real estate in Western countries.
 But now the chickens have come home to roost.