Natural philosophy and identity
A concept of ‘identity’, which goes beyond the trivial identification of something with itself, is so poorly defined that people can make a killing out of it. Conceived of as membership of a set of elements picked out by a predicate, identity becomes a matter of belonging in a straightforward and unsentimental sense. Democracy too is a matter of multitudes electing to follow different paths. In his penultimate chapter entitled ‘Democracy and the Three Identities’, Vikram Soni observes: ‘Every individual has a personal identity, but also a larger identity that encompasses the society, and an even larger one that encompasses the planet on which we live.’ Of these identities, which for an individual involve – prosaically – being human, being part of society and being a denizen of planet Earth, none of which has any essential overlap with democracy.
Perhaps the juxtaposition of identity and democracy is best seen in the light of homo economicus. As rational economic agents prone to maximizing utility, how do social and environmental considerations come to have any sort of role in decision making? If we confine ourselves to the here and now, such concerns, which transcend individual interests, seem far-fetched. To factor in social and inter-generational equity, normative judgments seem inescapable. Individual hedonism of the Lokayata variety can only recommend yavaj jivet sukham jivet rnam krtva ghrtam pibet/bhasmibhutasya dehasya punaragamanam kuta://(while you live, live well, consume ghee taking a loan/once the body is reduced to ashes how can it return?) as a caricature of the original Brhaspati Sutra puts it. Arguably the world economy in the age of globalization has become unashamedly hedonistic, valorizing the concentration of wealth in a tiny fraction of the population, while substantial numbers live in abject poverty.
Following the Wall Street crash and the subsequent bailout of banks by the US Treasury, Mikhail Gorbachev, the architect of perestroika, a restructuring that was so sweeping that the Soviet Union ended up in the dustbin of history, wryly observed that ‘we now have capitalism for the poor and socialism for the rich.’ I happened to be with a corporate baron in an office overlooking Central Park in New York in September 2008 when he gazed nervously at a plasma screen that showed the markets nose-diving even as we conversed. The sense of foreboding that hung in the dank air was palpable.
‘Naturally’, these memories came flooding back when I read Vikram Soni’s pronouncement: ‘The corporate world works on the simple rule: capitalize the gains and socialize the losses’ which echoes Gorbachev. Piquantly enough, this sentiment has a pedigree going back to Martin Luther King Jr. In March 1968, just weeks before his tragic assassination he said: ‘This country has socialism for the rich, rugged individualism for the poor.’
In his book Soni blames the oil barons (p. 245) for the ‘crash of 2009’ which gets the timeline and causation a little off the mark. Not having had much truck with the dismal science, I was forced to trawl the net for facts and figures. Unbeknownst to me and I daresay to many Americans and people elsewhere, the US Federal Government had established a 10 member bipartisan Financial Crisis Inquiry Commission (FCIC) to ‘examine the causes of the current financial and economic crisis in the United States.’ Chaired by Phil Angelides, a former two-term Treasurer of the state of California, who, interestingly enough received in 2002 the ‘Local Environmental Leadership Award’ from Global Green, presented by Mikhail Gorbachev, the FCIC submitted a report approved by a simple majority of 6 to 4, to the US President and Congress in January 2011. The FCIC report concluded that the crisis could have been averted had it not been for regulatory failure, febrile corporate governance, reckless risk taking by Wall Street and government leaders poorly prepared for the crisis, which revealed ‘systemic breaches of accountability and ethics.’
For a government report, it achieved the remarkable distinction of appearing on the New York Times and Washington Post best-sellers lists. The New York Review of Books was effusive in its praise, hailing the report as ‘the most comprehensive indictment of the American financial failure that has yet been made’ and ‘the definitive history of this period.’
Indeed, the conclusions of the report gave little cause for cheer. It noted: ‘As this report goes to print, there are more than 26 million Americans who are out of work, cannot find full-time work, or have given up looking for work. About four million families have lost their homes to foreclosure and another four and a half million have slipped into the foreclosure process or are seriously behind on their mortgage payments. Nearly $11 trillion in household wealth has vanished, with retirement accounts and life savings swept away’ (p. xv). It agonized over the task entrusted to it by the federal government: ‘…our mission was to ask and answer this central question: how did it come to pass that in 2008 our nation was forced to choose between two stark and painful alternatives – either risk the total collapse of our financial system and economy or inject trillions of taxpayer dollars into the financial system and an array of companies, as millions of Americans still lost their jobs, their savings, and their homes?’
When Barack Obama took office in 2009, his Republican predecessor George W. Bush handed over to him the reins of an economy on the verge of chaos. He was quite clear that of the painful alternatives he faced, he needed to adopt the fiscal stimulus route to stave off total collapse, although his campaign rhetoric had targeted Wall Street, espousing the cause of millions of ordinary Americans whose lives and dreams were shattered, caught up in a crisis that was not of their own making.
Areport which was political dynamite was quietly shelved, despite copious professions of sympathy for the millions of law-abiding folk whose votes counted. Five years after submitting the report, Angelides was shocked to find that the Department of Justice (DOJ) had not initiated proceedings against even a single senior Wall Street executive.
‘The unwillingness of DOJ under Attorney General Eric Holder to pursue misconduct by high ranking individuals will stand as a seminal failure of his tenure – undermining efforts to deter future wrongdoing and rightly breeding anger and cynicism about the fairness of our legal system’, he noted. ‘The decision to give a pass to the Wall Street executives who drove the pervasively corrupt mortgage machine is particularly disconcerting when considered alongside of DOJ’s vigorous prosecution of more than 2,700 individuals at the local level – mortgage brokers, appraisers, borrowers – who were just small cogs in that machine.’ On the fifth anniversary of the FCIC report, Angelides has queried Attorney General Loretta Lynch about holding Wall Street executives accountable for the havoc they inflicted on the economy.
The financial crisis was a consequence of innovation in financial markets, spurred by the meagre 1% return on investment offered by Treasury Bills from the Federal Reserve. A decade earlier, Angelides had red-flagged subprime home loans which worried him. ‘Securitization’ converted assets such as home mortgages into bonds that could be sold to investors. The market was stressed as loans were getting scarce and people were defaulting on mortgages. In two years Lehman Brothers went bust and the US economy was staring at a precipice. The new financial ‘products’ were ‘wormed through with rot and disease and fraud’ and Angelidis was shocked to find that the ratings agencies were part of the charade.
In the Great Depression of the 1930s, rising inequality has been cited as the central feature. With money channelled into a few pockets, the purchasing power of the vast majority depended on the availability of credit. When that ran out, effective demand was depressed and finally choked off. A similar phenomenon was observed by Raghuram Rajan, the Governor of the Reserve Bank of India, who was chief economist at the IMF in the years leading up to 2008. Unable or unwilling to address the problem of economic deprivation, easy mortgage credit seemed to be a quick fix, mortgaged property whose value was on the upswing was used to leverage loans for consumption expenditure. Shying away from addressing rising inequality, the response was ‘let them eat credit’, a prescription which led to the crisis, followed by recession.
Questions of fair play, justice and ethical practices were at the heart of the financial crisis visited upon the world’s largest economy. How does one address critical issues of ethical conduct, whose breach was the root cause of the crisis, as it involves making normative judgments? How can an unregulated economy driven by rational calculations of individual gain be evaluated ethically? This question is analogous to the one we face when technical innovations create a disequilibrium which threatens the ecosystem as a whole.
What is it that is capable of preserving the whole, in one case the environment and in the other, the economy, while meeting reasonable demands of the bhokta, the consumer? What holds things together – yad dhriyate – is ‘dharma’. Dharma is not pure normativity, but in some sense the foundation. Dharmo rakshati rakshita, i.e. dharma protects the protector of dharma forming a virtuous circle. It is noteworthy that dharma sidesteps the empiricist fact-value distinction and cannot be rendered as ‘faith’ or ‘religion’ as in some modern Indian languages; it is about the interaction of humans with non-human entities, be they other forms of life, the ecosystem or somewhat more abstractly, transactions between humans of goods and services which we group under the ‘economy’.
The Rg Veda does refer to sanatana dharmani, i.e. eternal principles, as do the Upanishads. However, dharma as a foundational category received particular emphasis in trading communities which were of necessity ecumenical. In the marketplace, goods were sold to those willing to pay for it, without regard to occupation, faith or social standing. The Jaina and Bauddha traditions tended to occupy this transactional space even as the transactional nature of the everyday world was theorized as something to be transcended.
Thus the role of ahimsa or non-injury as an essential constituent of dharma came to the fore, initially as a criticism of the Iron Age civilization’s inroads into the forests, causing a serious environmental crisis and turning large parts of the subcontinent into deserts. The practice of animal sacrifice, criticized by the Buddhists (‘sakya: kruddhyanti’ as the Purva Mimamsa says) was put on hold and eventually abolished almost everywhere. The Mahabharata unequivocally proclaims ‘ahimsa paramo dharma’, showing that this criticism had hit home. In the Anusasana Parva 116.28-30, the verse concludes with the observation that ‘sarvadanaphalam vapi naitattulyamahimsaya’, i.e. ‘even all the fruits of generosity do not equal alms.’
The sarvabhutanam anabhidroha (not damaging any being) principle which seemed an excessive demand, is now turning out to be very relevant and topical, given the phenomenon of climate change. The web of life, which involves finely calibrated interactions with the ecosystem threatens to unravel in the face of anthropogenic climate change. Water, the elixir of life, comes from our monsoon-fed rivers originating in the mountains. In a good monsoon, floods are a possibility and the flood plains of these rivers allow water to filter through sand to reach underground aquifers which could be tapped for potable water within limits.
To prevent private greed from ignoring all restraints is no easy task, but it is one that needs to be done, given that this planet is our sole cosmic habitat. While we will perish if we are taken out of the planet, it will just as easily perish if our thoughtless depredations continue while we are on it. Preventing the ecosystem from going into a tailspin is a challenge that humanity needs to rise to in the face of the possible extinction, not just of humans but all of life, turning the planet into a lifeless waste land which will be an unflattering epitaph for the hubris of humankind.