G: Despite the discussions we have had so far, your theory of the Irrelevance of the Relevance and the examples fails to convince me.
S: That it is so itself is a proof of my theory. What I considered as Relevant, you still consider that to be irrelevant. That is how the Natural forces interact to generate outcomes. Whatever we do is nothing but playing games like the children do. Better enjoy a story of how adults play children’s games.
G: What is this story?
S: Mr. Fakir, an erstwhile small farmer from Ingur district, and Mr. Amir, a renowned industrialist. They had a chance meeting in a small restaurant at a New York Airport. Mr. Amir was enjoying a cup of coffee waiting for his next flight to Los Angles. This is what they were discussing:
“ Fakir (F): Good Morning, Mr. Amir. Enjoying your Coffee, Sir.
Amir (A): Yes. Thank you.
F: Sir. There’s headline CNN news on our country and your company, Sir.
A: You know about my company!
F: My name is Fakir, Sir. I have come to USA because of the new car factory your company is setting up in my native village.
A: How did my car company cause your travel to US, Mr. Fakir?
F: I am very happy, Sir, that your company helped me to come to USA and enjoy a better life.
A: Mr. Fakir, I am unable to understand the link between your coming to US and my company.
F: Sir, please notice the CNN headlines. ‘Legislators break Assembly House Furniture: Furor over Amir Car Land deal’.
A: Yes. In our democratic country, every political party seems to know what is the best for the country but they seldom agree on what is the best. They do not seem to know how to account for costs and benefits of the land transfer to our company.
F: Sir, I do not agree with you that they do not seem to know only what is best for the country. As far as I see, the politicians do not seem to know anything except street shouting, fighting, and lecturing to the illiterate and half-educated majority of our countrymen. And, of course, they know how to act as medieval kings collecting money from others by ingenious methods of extortion and spending growing amounts of public money without contributing anything worthwhile to the country.”
G: Before you continue further, let me say that you are yourself are playing a mischievous game to ridicule the politicians and democracy.
S: Well, I could do that. But that is not the relevance of my story. It is all about how different sections of the society consider what is a relevant argument and what is not. May I continue with the story?
G: Please do.
S: Mr. Amir was obviously interested in discussing about politicians. So the discussions continued as follows:
A: You know as an industrialist, I cannot afford to annoy the kings and the potential kings of a democracy. To survive as a businessman, I must keep good relations with all political parties. But I am interested in knowing how my company helped you to come to USA.
F: Sir, that is because your company wants to set up a car factory back home in our village.
F: Please elaborate. Mr. Fakir.
F: Sir, I am benefited just because you planned to set up your car factory there. I come from the rural, agricultural locality where your company is setting up the factory to manufacture low cost Amir car for relatively poor countrymen. My father in-law inherited from his forefathers a large tract of agricultural land in the same locality. The Govt. took away the major part of the land he held about two decades back to distribute these lands to landless farmers. That was named the great land reforms revolution.
A: I have read about this great land revolution. Land owned by rich peasantry in excess of a certain individual/ family ceiling was kind of confiscated and then distributed among the landless farmers: this was hailed as great socialistic achievement of ensuring land to the tillers. This resulted in rapid growth in agricultural production and productivity. But what did your father in-law do after losing the land?
F: Fortunately, the land was still in his name. As the legally required documentation formalities were not properly completed during the last twenty years, mutation of ownership in favour of the farmers who received the land as gift from the Govt. was not completed. So my father in-law could still sell the same land to locally influential land dealers at a very good price.
G: You are again trying to project the State as a kind of villain.
S: That indeed is not my intention. But can you rule out the possibility of what story indicates about the credibility of agricultural land ownership records? You cannot. But this is Relevant when judging the credibility of the State’s power. Let me continue:
A: Why did these dealers give a good price to your father in-law? The land truly belonged to the farmers who got the land from the State.
F: The land dealers being influential knew about the possibility of land deal with your company in advance and used their information to buy the land from my father in-law and others. Ultimately, they sold the land to the govt. at a price equal to about double the market price. Within a short period of three months they made 20 % return on their investment and earned a measure of goodwill in govt. circles for facilitating quick land acquisition.
A: So, you mean that both your father in-law and the land dealers benefited because of our decision to set up a car factory there. But how did you get benefited?
F: I happened to fall in love with and marry the only daughter of my father in-law. So, he gave my wife a part of the sale proceeds he received. I used part of money he gave her to get trained in information technology enabled services. This helped me to get a job in a multinational financial services company operating a BPO facility in my State’s capital city. After three months’ training, I will be posted as Assistant Client Service Operations Manager in my city. I am taking the same flight with you to Los Angles and could not resist picking up a conversation with you and than you.
A: It was so kind of you to do that. I am happy that I met a person like you who could account for at least three sets of people who benefited even before my company invested a rupee in the car factory.
G: So, you agree that the State power can benefit lot of people.
S: Hold on Sir. Whenever the State tries to bring benefit to the people the State also inflicts a cost. Moreover, the beneficiaries from State decision about whom we have heard so far in the story are not supposed to be the intended beneficiaries of State’s action. Let me continue with the story:
F: Sir, I must tell you that there may also be some who may suffer because of your car factory.
A: I hear that some landowners in your locality are not willing to sell their lands to the Govt. for ultimate transfer to my company for setting up the car factory. That is why they are agitating. That is why there was this revolutionary act by opposition political party in the Assembly House in your State capital. The small farmers who lost the land and did not get compensated must have been adversely affected.
Fakir: I am one among such small farmers who lost the land once given to them free by the State, Sir. A small piece of land was given by the Govt. to my father as a landless farmer two decades back. I along with my four brothers inherited that land. But it was really uneconomic for four of us to cultivate that small land. It was too small. The Govt. helped my father to get this land free for twenty years during which he earned from the land and gave us some education. We were not much interested in continuing as farmers on a small plot of land. Even then losing the land was emotionally painful. But the land dealers gave us some money so that we do not create any fuss. So, we got some money. Two of my brothers have decided to set up small food-cum-stationery shops to cater to the demand of the construction workers for the factory and subsequently to the demand from the employees of the proposed car factory. The other two brothers have been working in nearby towns as semi-skilled factory labour for the past three years.
A: So, the farmers like you and your brothers are not adversely affected. But all farmers are not going to get small business opportunities to earn their living or may not have got any money from the land dealers. In any case not all are as fortunate as you or your father in-law.
F: You are right. Some farmers, who got their land from the govt. two decades ago, had got their name in the land ownership records. They have got good compensation from the govt.: they got nearly double the market value of the land they gave to the govt. Not all landowners, who sold their lands to the govt., are real farmers and with the sub-division of ancestral land among siblings, the small land plots are in any case becoming uneconomic to cultivate. It would have been useful if your company had set up, instead of a car factory, an agricultural cultivation factory and employed the farmers as agricultural workers. I understand some of the farmer families would get employment in your factory.
A: Yes, when the car factory comes up, it will absorb some displaced farmers as factory workers. There is a proposal to train some farmers in skilled work required by the factory. And, during the factory construction period, the farmers can find employment as land preparation and construction workers. But it seems that some of the real farmers will not get compensated.
F: Yes. Even after two decades, some sharecroppers, who were given land by the Govt. free, could not get their ownership registered in the official records. They are unable to legally claim compensation for the land they were actually cultivating and now being acquired by the govt.
A: The govt. should compensate them also.
F: Yes. That is likely to happen now that the govt. has come to know of the ground level reality.
G: So, you see in democracy, the State is so responsive to the ground reality.
S: You are right. But only after considerable agitation the State comes to know what the ground reality was. The compensation was not originally designed properly to ensure that all the genuine owner-cultivators get the compensation. That speaks volumes about the efficiency and credibility of State machinery even in a democracy. That is the point I consider relevant. Let me continue the story:
A: In that case, the entire land deal will be fair to all. Everyone will be protected and satisfied.
F: Still some people would have transitional problems once they lose their land you are getting for the car factory.
A: This happens even when a factory closes down because of permanent loss of its commercial viability. New factories come up to absorb some of them. Others have to be taken care of by the Govt. by giving them training in other vocations and skills, finding for them redeployment opportunities as also providing them some financial help to tide over the transition process. Our factory may create some new employment directly. But more employment will be generated outside our factory. Our vendors, suppliers and transporters will create employment. The people working in the factory will generate demand for goods and services from new local shops that will hire people from local farming families.
F: Maybe, that will happen. But people say food prices will rise as a result of transfer of land from agriculture to industry.
S: How will the prices go up?
F: According to the opposition party politicians, the transfer of such a large tract of land from agriculture to industry will mean loss of agricultural output. The output of rice and potatoes will decline. This will mean prices of these will rise.
A: That may not be true. Actually, the land that the factory will take away from agriculture is a small percentage of total agricultural land in your State. So, agricultural production need not go down as a result of our factory taking away some land. We must try raising the productivity of agricultural land by consolidation of fragmented land and introducing large-scale commercial farming. Then we can produce more agricultural crops even by using much smaller land area for farming.
F: That is why I was suggesting that you set up large agricultural operations factories, if not instead of, but in addition to a car factory.
A: We may not be very good at running an agricultural factory. But when the govt. allows, some others who are more competent than us in this field will set up such large agricultural factories when the Govt. allows such things. At present, that is not permitted by the govt.
F: That is unfortunate. We will need more and more land for residential homes, schools, colleges, entertainment parks, offices, factories, shops and roads to meet the demands of our huge and growing population with rising incomes. This would mean transfer of more and more land from agriculture.
A: Do not worry. One day, the State will realize what it needs to do about increasing agricultural productivity and production so that industrial, housing and transport growth in your State does not get constrained.
F: But till that happens more factories means less agricultural output. We will have to import food grains and other commodities from other States and countries to keep the prices in check and feed our countrymen.
A: Such imports will take place automatically. Other States and countries will export their agricultural products to your State and your State will export various goods including small cars from our car factory to the outside. At one point of time, your state had numerous tanks and ponds. These were supplying various types of fish to the kitchens of your State where fish is daily item of consumption. Later, water in those ponds and lakes were drained out and residential and other buildings constructed in their place. Your state now imports fish from other states where fish is not a daily item of consumption!
G: Your story repeatedly comes back to point out the deficiency of the State.
S: That is not relevant. What is important and relevant to the people in democracy and the minds that are exposed to scientific methods is that the State and its machinery as also the opposition political parties do not have adequate brains that can apply scientific methods or they just do not care about being scientific and knowledgeable. It is only after some citizens start crying and protesting that the State machinery collect and come out with facts. Common citizens like Mr. Fakir do not get to know the truth but has to depend on politicians’ propaganda and misleading information. As the story reveals, the political establishment does not care to disseminate correct and credible information in time:
F: But why did you take away good agricultural lands producing three crops a year for the car factory? You could have taken barren or low productivity lands.
A: We require a large stretch of contiguous land that enjoys convenient links to good transport and other infrastructure. The contiguous tract of land we chose for the car project unfortunately contains a small percentage of highly productive lands. Some three-crop producing land is interspersed with some one or two-crop producing land. So we cannot help. This seems unavoidable.
F: But good quality land should get higher compensation.
A: Ideally yes. But in the 21st century, all land under agricultural operations must produce as many crops as possible and all agricultural land that industries are not taking away should be upgraded to produce multiple crop wherever and whenever possible.
F: How would you like to value the land plots you are purchasing?
A: The ruling market price could be a basis for valuation.
F: Ruling market price does not really reflect the true value of the land being acquired by the govt. for your car company. A competitive market for selling and buying land does not exist. So, land cannot be valued at the ruling market price.
A: I agree with you. That is why I understand that the govt. is giving a price that is nearly double of the ruling market price. But how do you really value of the land being acquired by the State for onward sale to your company?
F: It is so simple. You have to find out the opportunity cost.
A: You are right. Each piece of land acquired should be transferred at its opportunity cost.
F: The opportunity cost is nothing but the aggregate sum of the present values of annual income, net of all costs, which the land owning farmer will have earned by using the land for agriculture for the next 30 or 50 years. To arrive at today’s values, each future year’s annual net income from the land has to be discounted at the interest rate on long-term government bonds.
A: Ah! You are talking about the valuation methods we adopt when we make investment and other resource use decisions in industrial companies.
F: If that is the method you found suitable in your companies, why can’t the decision to transfer land from agricultural use to industrial and other uses be made with the help of such methods of accounting for costs and benefits?
A: I agree with you. We should use scientific accounting methods to arrive at correct decisions.
F: In that case, transfer of land from agricultural to car manufacturing factory should be at least at the opportunity cost, i.e. at the present discounted value of the future stream of net income from agricultural use of the land. If a new factory is viable after purchasing the land at that opportunity cost price, the land can be transferred to the car factory. Otherwise, it is a net loss to the society.
A: I agree.
F: Have you done such calculations to find out whether the society will be a net gainer by transferring agricultural land in favour of the proposed car factory?
A: Not really. This is what should be done by the State because it has taken the authority to decide on land use. Maybe they have done but such calculations do not seem to be available in the public domain.
F: Yes. We have a non-transparent, opaque democracy managed by elected political despots. We cannot expect such calculations to be made or, if made, disclosed to the public.
A: Please do not ask me to comment on this.
G: The Govt. has already started getting these calculations made. Some relevant information is being made public. I understand a white paper may be released. And, all this has become necessary since the opposition parties have gone into violent agitations along with indefinite hunger strike by their leaders.
S: It is sad that the political parties behave like despots lording over citizens. The white paper should have been the first step before the decision to acquire land for transfer to proposed car factory was taken and publicly announced. If the opposition parties were responsible and accountable rather than despotic leaders, they would have themselves produced such a white paper for public scrutiny and debate as soon as the Govt. announced its plan to acquire land. Just because you are political party leaders and supporters you cannot play irrelevant games like the children do. This is what is relevant to judging the quality of democracy and the efficacy of the use of the powers of the State.
Those who have faith in State and democracy have blind faith in them. They are incapable of questioning the quality and credibility of democracy and the use of the powers given to the State. They suffer from cause-effect obsession syndrome or are pure and simple engaged in the lucrative business of fooling and oppressing the common citizens.
G: You continue with your story.
S: Fine, the story is even more pathetic:
F: It seems you are getting the land cheaper. You should pay higher prices for the land you are buying from the Govt. Land cost is a small percentage of the cost of setting up a project. If you give a 50% higher price, your total project cost would not have increased by more than 25 or so.
A: You are right. But the people who have invested in our company expect me to buy land and other things at the lowest possible cost without undermining quality. I am obliged to do that. If other states offer me land at a lower price, I have no moral right to buy land in your State at a higher price.
F: I agree. But it seems that the govt. is a big loser from your car project.
A: No, that is not true at all. With the new car factory and activities linked to it, more employment, more income and more income tax and other revenues will be generated. Over a period of time the govt. will also benefit considerably.
F. I thought so. Thanks to your car project, every one in the State seems likely to be benefited, except a few who would have temporary difficulties and they can be assisted to tide over that transition phase. But no one seems to have used scientific methods to calculate the cost and benefits.
A: You are right.
F: It is because of the reluctance to apply scientific methods to calculate costs and benefits that we have heated controversies and bandhs? Also, such useless and costly controversies and bandhs may happen again and again when factories, townships, airports projects are proposed and the govt. has to go in for land acquisition. Each bandh is a cost to the society without any benefit: so are the protracted emotional debates in the media, the legislature’s offices and political propaganda meetings. All this is sheer wastage of national resources: money, paper, time and effort.
A: You are right. Maybe in democracy we have to bear this additional cost.
F: I do not agree with you, Sir. We are reluctant to use proper quantitative accounting of effects of alternative decisions. When we are in the political arena, our politicians and elite classes forget everything except counting of potential votes in favour or against, emotionally charged public speaking without any substance, and muscle power. Muscle power technology and street shouting technology are the pillars of our democracy: accounting technology is for other commercial business applications.
A: You have a brilliant idea. How did it occur to you? You are not a Chartered Accountant or MBA.
F: No, Sir. I am only a bachelor of commerce. It seems accountancy and accountability is not what our democracy likes to adapt to.
A: Good observation. We could discuss this if we meet again.
G: I am trying to comprehend the relevance of your story.
S: You should. Just think if two persons can have such a conversation on their own without much quantitative information, what were the political parties and their great leaders as also the govt. doing. Playing games at the cost of the society? But let my story end in a positive note, before we close this series of dialogue sessions:
F: You are a very old, reputed industry house with considerable focus on societal welfare. Why don’t you consider grant options to buy 10 shares of your car company per acre of land given to you by the farmers with an exercise price equal to your company’s market price as of 31st March 2009 and options exercisable between 31st March 2012 and 31st March 2015? With that the farmers will feel that they have an upside. This would prove that you have purchased the land with a greater measure of fairness.
A: Thank you for a novel suggestion. But I regret we have to hurry now. They have announced the last and final call for our boarding.
F: Yes, Sir. Thank you for spending some time with me.
A: I enjoyed the time with you. Good luck to you, young man. May our country be filled with citizens like you and you become
G: Can we have one more global example of cause-effect obsession syndrome, cause-effect inverse and relevance of irrelevance?
S: Oh, sure. First, let us deal with what causes some people to seek right to intellectual property (IP) and its protection from being copied for commercial purposes. Those who have anything that is novel that they have designed or discovered or invented may have a need for IP protection. They want to make money from their own IP or at least want to get recognition for their contribution. Some of those who think and can demonstrate that they have created something novel and the use of that creation by others should be subject to their permission which they may grant at their discretion, if necessary against payment of some monetary consideration by those they have agreed to allow such use.
G: The cause is the desire on the part of the creator to benefit from his/ her creation and the effect is the demand for IP.
S: Yes. But there is an underlying reality that is not so explicitly stated. If X has invented something that can be successfully commercialized and money made without any possibility of copying on commercial scale by others, there is no need for IP protection. Unfortunately, for most creations copying is generally very easy. Therefore, restriction on copying is what is being sought. The cause-effect obsession syndrome starts then as follows: if you allow free copying no one will have incentive to create or innovate things that can help human society to progress. So, IP right is nothing but negation of human right to copy.
G: Right to copy!
S: Yes, freedom to copy can be regarded as a fundamental human right. Without copying human civilization cannot exist. From the childhood you learn to copy and parents urge you to copy them so that you can live. You must copy how to walk, how to keep yourself clean, how to eat and drink, how to talk, how to read, write and communicate, sing, dance and so on.
G: So, the cause-effect inverse here is that if you do not allow free copying right, human society cannot make progress. If I am not allowed to copy running and innovate as to how I can increase my speed of running, how do I catch a thieve running away stealing my money from my pocket?
S: You are right. That is why many creators themselves want that their creation be freely copied without any restriction. They enjoy that many people benefit by costless copying of their inventions. The greater is the incidence of copying the greater is their delight.
G: So, you are against copyright laws.
S: Please do not jump to conclusion without logical justification. I recognize the natural need and right to copy. I also agree to the need for copyright laws. If copyright laws are not there, authors will not write for a book, publishers will not publish books, music companies will not record songs, movies, dramas and events on tapes, audio/ video cassettes, compact disks etc. But despite all copyright and patent laws, we have official sales of recorded music industry falling behind the sales of illegal copying based pirated music distribution industry. A similar thing happens in pharmaceuticals industry. The official industry has to innovate to make unauthorised copying and piracy uneconomic and restricted. That is the technological and marketing challenge the official industry has to take up.
G: So, you say that both copyright and copying will continue.
S: Yes. But one should note that not all things that you see some other person do can be copied or at least easily copied by you or others. There are a few possibilities of copying: a novel creation can be easily copied sooner or later, or difficult to copy even after a long time, or almost impossible to copy in the foreseeable future. There are a few possibilities on the cost of creation: a novel creation without much cost (resource, time and/ or effort) or with substantial cost. For simplicity, we can have six possible combinations: (a) easy creation & easy copying, (b) easy creation but difficult copying, (c) easy creation and impossible to copy, (d) difficult creation and easy to copy, (e) difficult creation and difficult copying, and (f) difficult creation and impossible to copy. For (c) and (f) categories, there is no problem. Problem arises in the remaining four cases.
G: Creations of category (a) also does not pose any problem. For that which is easy to create, there is nothing that the first creator can demand to be compensated for. The same thing may have been created soon even if the first creator had not been the first to create.
S: You are right. Categories (b) and (e) also do not pose much of a problem because there is an embedded IP protection for quite some time, copying being difficult. Real problem arises in the case of (d) category creations: if you do not protect the commercial interest of inventions/ innovations that cost much time, effort and money but easy to copy, adequate effort and money may not be attracted to the creative process of innovations and inventions. As a result, the society may suffer from slower progress of the human society.
G: For (d), therefore everyone will agree to Intellectual Property Right (IPR) and IPR protection.
S: I also believe that everyone will agree.
G: Then where does the debate originate?
S: It arises from how the inventions or creations are classified as novel creations of category (d) and how long the protection is granted for them. Failure to identify creations of category (d) as such or inadequate protection period for such category creations may hurt the process of creations and therefore the interest of the creators and the progress of human society, though the copiers may be benefited.
G: On the other hand, creators of (a) category creations may try to show that their creations are category (d) creations. This will also hurt the process of innovations besides hurting the society’s interest.
S: You are right. Thus, the problem arises not with IPR protection as such but with the way the IPR protection is ensured in the case of (d) category creations: short, unambiguous laws on IPR, proper identification of IP creations of category (d), and the enforcement of such IPR. This clearly is not an easy task and cannot be handled of run-of-the-mill, ordinary bureaucrats. It requires highly perceptive scientist personnel capable of quick decisions on IPR protection applications and IPR protection intelligence and police personnel with adequate powers and accountability.
G: But this is an almost impossible task in large population countries with high propensity to copy clandestinely without paying the creators any consideration
S: Yes. That is why India and China may find it difficult to have strong and effective IPR regimes.
G: But there are non-profit foundations which do lot of collaborative research on the basis of what is called open source model of development as in the case of software development. These foundations and the people who participate in open source software and other scientific problem solving do not seem to worry about IPR or the pecuniary or reputation/ recognition prize rewards.
S: You are right. This is new model of development of science and technology is driven by motivations like the psychologically good feeling of being challenged by various unsolved problems or of being part of an open community of problem solvers or simply the scope of learning new things. Often, such open, collaborative efforts results in faster cracking of problems than the time taken by the closed door, secretive scientific and technological in-house research undertaken by company R&D and research institutions.
G: If that were so, why do we emphasize on IPR?
S: First, complete open source process of creative innovation and invention may not suit all areas of science and for large companies to depend on. Second, such open, collaborative efforts at problem sharing and problem solving may actually increase the efficiency of problem solving within companies and research institutions. Third, the open-source, collaborative efforts can also lead to new regimes for IPR protection laws. Those who participate in the open, collaborative processes may get something in the nature of free stock options: options in this case will be on the sharing of gains from patents based on collaborative generation of solutions to scientific and technological problems.
G: Ultimately, strong IPR regimes will help countries like India and China to gain faster.
S: Yes, relatively low income countries with large population of scientifically trained minds should do better by giving up the practice of copying and start participating in open source development of science and technology. It is a cause-effect obsession syndrome that leads us to believe that IPR protection is in the interest of already advanced, rich countries and multinational companies. When we look at open source process of scientific and technology research, we develop a cause-effect inversion. Then, we start seeing that effectively designed and implemented IPR regimes are relevant to poor countries like us: reliance on unauthorized copying the creations of foreign innovators and denying IPR to foreign innovators actually hurt countries like us more than the advanced Western countries.
G: But you can’t expect poor countries to spend huge amount of resources to innovate.
S: The issue is that can poorer countries remove their poverty through copying. Both the goal of lifting huge populations from poverty and the means of copying are wrong. The goal should have been to enable each of their citizens to become as rich as possible. If you aim low, you achieve only that. If you aim high, you apply your brain better and succeed. But whether you aim low or high is not within your choice. The means to achieve the goal should have been to allow creative and productive talents in science, technology and entrepreneurship inherent in human beings to flower.
G: How can poor, uneducated people identify and use their talents? You have to educate them first. That is why the State plans programs to do that.
S: State can only plan. The State cannot implement and get the results. People achieve the results individually and groups at their pace. Directing, controlling and cajoling them do not help. If State plans for the people, the people think that it is the State that has the responsibility for and capability of achieving what the State plans.
G: If the State does not arrange for economic and social development, who will?
S: You suffer from Cause-Effect Syndrome. You think planning is the cause and achievement of desired goals is the effect without any scientific basis. Did all inventions and discoveries in this World result from State planning? Confront the Cause-Effect Inverse by finding how state planning and initiative had caused the following effects: the proof that the Earth revolves around the Sun and the Sun does not revolve around the Earth, the discovery of the theory of relativity, the building of the first airplane, the use of the wireless technology, the development of the principles of management, the technique of double-entry book keeping, the popularity of cricket or soccer or Lawn Tennis all over World, the proliferation of amusement parks and shopping malls, the development of plastic money. State is irrelevant to the progress of human civilization.
G: But some States do better than others!
S: Yes, that happens because some States allow greater economic freedom to citizens and allows merit and talent to compete in exerting their influence on how the State functions. Such states may do better than other states that curb individual freedom, encourages acquiescence, rewards loyalty to the Ruling class and requires merit and talent to seek State patronage.
G: You mean to say that India’s economic development in the last 60 years was possible without the State’s direction, control and initiatives.
S: Whatever India or any other country has achieved so far is purely because of individual enterprise. The results achieved are not because, but in spite, of the adverse effect of State’s active meddling with economic affairs of the country.
G: Why do you say in spite of the State?
S: Because State planning and control has constrained the progress of education, dynamism of entrepreneurial risk taking, motivation to excel, and so on. When the whole World was available for Indians to acquire knowledge, to trade with and gain, to compete with and succeed, the Indian State ensured that the people of India live virtually isolated from the World. Economic freedom was snatched away from the citizens by the State in India. Citizens that live in economic serfdom perpetuated by the State’s over-riding power cannot deliver outstanding results on a sustained basis.
G: Why did India choose the State-ist model, if what you say is true.
S: There is one and only one reason: You choose as your nature permits you. That’s getting back to Stochastic Destiny Principle, as you would like to point out.
G: But since the economic liberalization started in 1991, India has become less Statist.
S: That is your illusion. Instead of a fixed short chain that you tug in the neck-collar of the dog you can use an expandable-and-contractible chain also. That is not freedom.
G: How is this relevant to IPR. You have a tendency to digress!
S: This is another example of the Relevance of the Irrelevance. When you are so obsessed with State-ism, you cannot imagine the potential of economic freedom to the citizens. Unless the individuals are free, exploitation of creativity is constrained. The citizens are forced to copy rather than innovate since the State does not believe in IPR.
G: But we have copyrights and patents since long.
S: Yes, some legislation exited till the recent changes took place. But we know how high has been the incidence of violation of copyrights, trademarks and patents as also the extent of piracy in recorded audio/ videotapes and CDs, drugs, automobile spares and so on.
G: In such a huge country, enforcement is not an easy task.
S: It all depends whether one chooses to be equal to the task. One makes choice one is naturally inclined to make. That’s your destiny. But that does not justify the poor enforcement record. Poor IPR laws and poor enforcement encourages copying, breeds mediocrity, discourages innovations and kills motivation to excel, which hurts economic and social progress. Copying clandestinely, according to me, is an activity of people with low self-esteem.
G: If you are poor, you are prone to copying.
S: You are right. Some poor people find no alternative but to steal to live their lives. Some other poor people organize muscle power to become bandits to commit robbery or become terrorists. Some other poor people just tolerate their poverty. It all depends on the natural inclinations of the individuals. Violation of copy rights, trademarks and patent laws, however, are committed generally by rich people, even if they belong to poor countries.
G: You do not seem to be interested in prescribing solutions.
S: Prescribing solution is easy. In fact, our discussions point to alternative solutions. The responsibility of choosing a particular solution and the success or failure of a chosen solution lies only with those who want to solve the problem. They choose according to their natural inclinations. That is in accordance of the stochastic destiny principle.
G: As usual, we have to close this session without reaching an agreement.
4. Playing Games
G: Despite the discussions we have had so far, your theory of the Irrelevance of the Relevance and the examples fails to convince me.
S: That it is so itself is a proof of my theory. What I considered as Relevant, you still consider that to be irrelevant. That is how the Natural forces interact to generate outcomes. Whatever we do is nothing but playing games like the children do. Better enjoy a story of how adults play children’s games.
G: What is this story?
S: Mr. Fakir, an erstwhile small farmer from Ingur district, and Mr. Amir, a renowned industrialist. They had a chance meeting in a small restaurant at a New York Airport. Mr. Amir was enjoying a cup of coffee waiting for his next flight to Los Angles. This is what they were discussing:
“ Fakir (F): Good Morning, Mr. Amir. Enjoying your Coffee, Sir.
Amir (A): Yes. Thank you.
F: Sir. There’s headline CNN news on our country and your company, Sir.
A: You know about my company!
F: My name is Fakir, Sir. I have come to USA because of the new car factory your company is setting up in my native village.
A: How did my car company cause your travel to US, Mr. Fakir?
F: I am very happy, Sir, that your company helped me to come to USA and enjoy a better life.
A: Mr. Fakir, I am unable to understand the link between your coming to US and my company.
F: Sir, please notice the CNN headlines. ‘Legislators break Assembly House Furniture: Furor over Amir Car Land deal’.
A: Yes. In our democratic country, every political party seems to know what is the best for the country but they seldom agree on what is the best. They do not seem to know how to account for costs and benefits of the land transfer to our company.
F: Sir, I do not agree with you that they do not seem to know only what is best for the country. As far as I see, the politicians do not seem to know anything except street shouting, fighting, and lecturing to the illiterate and half-educated majority of our countrymen. And, of course, they know how to act as medieval kings collecting money from others by ingenious methods of extortion and spending growing amounts of public money without contributing anything worthwhile to the country.”
G: Before you continue further, let me say that you are yourself are playing a mischievous game to ridicule the politicians and democracy.
S: Well, I could do that. But that is not the relevance of my story. It is all about how different sections of the society consider what is a relevant argument and what is not. May I continue with the story?
G: Please do.
S: Mr. Amir was obviously interested in discussing about politicians. So the discussions continued as follows:
A: You know as an industrialist, I cannot afford to annoy the kings and the potential kings of a democracy. To survive as a businessman, I must keep good relations with all political parties. But I am interested in knowing how my company helped you to come to USA.
F: Sir, that is because your company wants to set up a car factory back home in our village.
F: Please elaborate. Mr. Fakir.
F: Sir, I am benefited just because you planned to set up your car factory there. I come from the rural, agricultural locality where your company is setting up the factory to manufacture low cost Amir car for relatively poor countrymen. My father in-law inherited from his forefathers a large tract of agricultural land in the same locality. The Govt. took away the major part of the land he held about two decades back to distribute these lands to landless farmers. That was named the great land reforms revolution.
A: I have read about this great land revolution. Land owned by rich peasantry in excess of a certain individual/ family ceiling was kind of confiscated and then distributed among the landless farmers: this was hailed as great socialistic achievement of ensuring land to the tillers. This resulted in rapid growth in agricultural production and productivity. But what did your father in-law do after losing the land?
F: Fortunately, the land was still in his name. As the legally required documentation formalities were not properly completed during the last twenty years, mutation of ownership in favour of the farmers who received the land as gift from the Govt. was not completed. So my father in-law could still sell the same land to locally influential land dealers at a very good price.
G: You are again trying to project the State as a kind of villain.
S: That indeed is not my intention. But can you rule out the possibility of what story indicates about the credibility of agricultural land ownership records? You cannot. But this is Relevant when judging the credibility of the State’s power. Let me continue:
A: Why did these dealers give a good price to your father in-law? The land truly belonged to the farmers who got the land from the State.
F: The land dealers being influential knew about the possibility of land deal with your company in advance and used their information to buy the land from my father in-law and others. Ultimately, they sold the land to the govt. at a price equal to about double the market price. Within a short period of three months they made 20 % return on their investment and earned a measure of goodwill in govt. circles for facilitating quick land acquisition.
A: So, you mean that both your father in-law and the land dealers benefited because of our decision to set up a car factory there. But how did you get benefited?
F: I happened to fall in love with and marry the only daughter of my father in-law. So, he gave my wife a part of the sale proceeds he received. I used part of money he gave her to get trained in information technology enabled services. This helped me to get a job in a multinational financial services company operating a BPO facility in my State’s capital city. After three months’ training, I will be posted as Assistant Client Service Operations Manager in my city. I am taking the same flight with you to Los Angles and could not resist picking up a conversation with you and than you.
A: It was so kind of you to do that. I am happy that I met a person like you who could account for at least three sets of people who benefited even before my company invested a rupee in the car factory.
G: So, you agree that the State power can benefit lot of people.
S: Hold on Sir. Whenever the State tries to bring benefit to the people the State also inflicts a cost. Moreover, the beneficiaries from State decision about whom we have heard so far in the story are not supposed to be the intended beneficiaries of State’s action. Let me continue with the story:
F: Sir, I must tell you that there may also be some who may suffer because of your car factory.
A: I hear that some landowners in your locality are not willing to sell their lands to the Govt. for ultimate transfer to my company for setting up the car factory. That is why they are agitating. That is why there was this revolutionary act by opposition political party in the Assembly House in your State capital. The small farmers who lost the land and did not get compensated must have been adversely affected.
Fakir: I am one among such small farmers who lost the land once given to them free by the State, Sir. A small piece of land was given by the Govt. to my father as a landless farmer two decades back. I along with my four brothers inherited that land. But it was really uneconomic for four of us to cultivate that small land. It was too small. The Govt. helped my father to get this land free for twenty years during which he earned from the land and gave us some education. We were not much interested in continuing as farmers on a small plot of land. Even then losing the land was emotionally painful. But the land dealers gave us some money so that we do not create any fuss. So, we got some money. Two of my brothers have decided to set up small food-cum-stationery shops to cater to the demand of the construction workers for the factory and subsequently to the demand from the employees of the proposed car factory. The other two brothers have been working in nearby towns as semi-skilled factory labour for the past three years.
A: So, the farmers like you and your brothers are not adversely affected. But all farmers are not going to get small business opportunities to earn their living or may not have got any money from the land dealers. In any case not all are as fortunate as you or your father in-law.
F: You are right. Some farmers, who got their land from the govt. two decades ago, had got their name in the land ownership records. They have got good compensation from the govt.: they got nearly double the market value of the land they gave to the govt. Not all landowners, who sold their lands to the govt., are real farmers and with the sub-division of ancestral land among siblings, the small land plots are in any case becoming uneconomic to cultivate. It would have been useful if your company had set up, instead of a car factory, an agricultural cultivation factory and employed the farmers as agricultural workers. I understand some of the farmer families would get employment in your factory.
A: Yes, when the car factory comes up, it will absorb some displaced farmers as factory workers. There is a proposal to train some farmers in skilled work required by the factory. And, during the factory construction period, the farmers can find employment as land preparation and construction workers. But it seems that some of the real farmers will not get compensated.
F: Yes. Even after two decades, some sharecroppers, who were given land by the Govt. free, could not get their ownership registered in the official records. They are unable to legally claim compensation for the land they were actually cultivating and now being acquired by the govt.
A: The govt. should compensate them also.
F: Yes. That is likely to happen now that the govt. has come to know of the ground level reality.
G: So, you see in democracy, the State is so responsive to the ground reality.
S: You are right. But only after considerable agitation the State comes to know what the ground reality was. The compensation was not originally designed properly to ensure that all the genuine owner-cultivators get the compensation. That speaks volumes about the efficiency and credibility of State machinery even in a democracy. That is the point I consider relevant. Let me continue the story:
A: In that case, the entire land deal will be fair to all. Everyone will be protected and satisfied.
F: Still some people would have transitional problems once they lose their land you are getting for the car factory.
A: This happens even when a factory closes down because of permanent loss of its commercial viability. New factories come up to absorb some of them. Others have to be taken care of by the Govt. by giving them training in other vocations and skills, finding for them redeployment opportunities as also providing them some financial help to tide over the transition process. Our factory may create some new employment directly. But more employment will be generated outside our factory. Our vendors, suppliers and transporters will create employment. The people working in the factory will generate demand for goods and services from new local shops that will hire people from local farming families.
F: Maybe, that will happen. But people say food prices will rise as a result of transfer of land from agriculture to industry.
S: How will the prices go up?
F: According to the opposition party politicians, the transfer of such a large tract of land from agriculture to industry will mean loss of agricultural output. The output of rice and potatoes will decline. This will mean prices of these will rise.
A: That may not be true. Actually, the land that the factory will take away from agriculture is a small percentage of total agricultural land in your State. So, agricultural production need not go down as a result of our factory taking away some land. We must try raising the productivity of agricultural land by consolidation of fragmented land and introducing large-scale commercial farming. Then we can produce more agricultural crops even by using much smaller land area for farming.
F: That is why I was suggesting that you set up large agricultural operations factories, if not instead of, but in addition to a car factory.
A: We may not be very good at running an agricultural factory. But when the govt. allows, some others who are more competent than us in this field will set up such large agricultural factories when the Govt. allows such things. At present, that is not permitted by the govt.
F: That is unfortunate. We will need more and more land for residential homes, schools, colleges, entertainment parks, offices, factories, shops and roads to meet the demands of our huge and growing population with rising incomes. This would mean transfer of more and more land from agriculture.
A: Do not worry. One day, the State will realize what it needs to do about increasing agricultural productivity and production so that industrial, housing and transport growth in your State does not get constrained.
F: But till that happens more factories means less agricultural output. We will have to import food grains and other commodities from other States and countries to keep the prices in check and feed our countrymen.
A: Such imports will take place automatically. Other States and countries will export their agricultural products to your State and your State will export various goods including small cars from our car factory to the outside. At one point of time, your state had numerous tanks and ponds. These were supplying various types of fish to the kitchens of your State where fish is daily item of consumption. Later, water in those ponds and lakes were drained out and residential and other buildings constructed in their place. Your state now imports fish from other states where fish is not a daily item of consumption!
G: Your story repeatedly comes back to point out the deficiency of the State.
S: That is not relevant. What is important and relevant to the people in democracy and the minds that are exposed to scientific methods is that the State and its machinery as also the opposition political parties do not have adequate brains that can apply scientific methods or they just do not care about being scientific and knowledgeable. It is only after some citizens start crying and protesting that the State machinery collect and come out with facts. Common citizens like Mr. Fakir do not get to know the truth but has to depend on politicians’ propaganda and misleading information. As the story reveals, the political establishment does not care to disseminate correct and credible information in time:
F: But why did you take away good agricultural lands producing three crops a year for the car factory? You could have taken barren or low productivity lands.
A: We require a large stretch of contiguous land that enjoys convenient links to good transport and other infrastructure. The contiguous tract of land we chose for the car project unfortunately contains a small percentage of highly productive lands. Some three-crop producing land is interspersed with some one or two-crop producing land. So we cannot help. This seems unavoidable.
F: But good quality land should get higher compensation.
A: Ideally yes. But in the 21st century, all land under agricultural operations must produce as many crops as possible and all agricultural land that industries are not taking away should be upgraded to produce multiple crop wherever and whenever possible.
F: How would you like to value the land plots you are purchasing?
A: The ruling market price could be a basis for valuation.
F: Ruling market price does not really reflect the true value of the land being acquired by the govt. for your car company. A competitive market for selling and buying land does not exist. So, land cannot be valued at the ruling market price.
A: I agree with you. That is why I understand that the govt. is giving a price that is nearly double of the ruling market price. But how do you really value of the land being acquired by the State for onward sale to your company?
F: It is so simple. You have to find out the opportunity cost.
A: You are right. Each piece of land acquired should be transferred at its opportunity cost.
F: The opportunity cost is nothing but the aggregate sum of the present values of annual income, net of all costs, which the land owning farmer will have earned by using the land for agriculture for the next 30 or 50 years. To arrive at today’s values, each future year’s annual net income from the land has to be discounted at the interest rate on long-term government bonds.
A: Ah! You are talking about the valuation methods we adopt when we make investment and other resource use decisions in industrial companies.
F: If that is the method you found suitable in your companies, why can’t the decision to transfer land from agricultural use to industrial and other uses be made with the help of such methods of accounting for costs and benefits?
A: I agree with you. We should use scientific accounting methods to arrive at correct decisions.
F: In that case, transfer of land from agricultural to car manufacturing factory should be at least at the opportunity cost, i.e. at the present discounted value of the future stream of net income from agricultural use of the land. If a new factory is viable after purchasing the land at that opportunity cost price, the land can be transferred to the car factory. Otherwise, it is a net loss to the society.
A: I agree.
F: Have you done such calculations to find out whether the society will be a net gainer by transferring agricultural land in favour of the proposed car factory?
A: Not really. This is what should be done by the State because it has taken the authority to decide on land use. Maybe they have done but such calculations do not seem to be available in the public domain.
F: Yes. We have a non-transparent, opaque democracy managed by elected political despots. We cannot expect such calculations to be made or, if made, disclosed to the public.
A: Please do not ask me to comment on this.
G: The Govt. has already started getting these calculations made. Some relevant information is being made public. I understand a white paper may be released. And, all this has become necessary since the opposition parties have gone into violent agitations along with indefinite hunger strike by their leaders.
S: It is sad that the political parties behave like despots lording over citizens. The white paper should have been the first step before the decision to acquire land for transfer to proposed car factory was taken and publicly announced. If the opposition parties were responsible and accountable rather than despotic leaders, they would have themselves produced such a white paper for public scrutiny and debate as soon as the Govt. announced its plan to acquire land. Just because you are political party leaders and supporters you cannot play irrelevant games like the children do. This is what is relevant to judging the quality of democracy and the efficacy of the use of the powers of the State.
Those who have faith in State and democracy have blind faith in them. They are incapable of questioning the quality and credibility of democracy and the use of the powers given to the State. They suffer from cause-effect obsession syndrome or are pure and simple engaged in the lucrative business of fooling and oppressing the common citizens.
G: You continue with your story.
S: Fine, the story is even more pathetic:
F: It seems you are getting the land cheaper. You should pay higher prices for the land you are buying from the Govt. Land cost is a small percentage of the cost of setting up a project. If you give a 50% higher price, your total project cost would not have increased by more than 25 or so.
A: You are right. But the people who have invested in our company expect me to buy land and other things at the lowest possible cost without undermining quality. I am obliged to do that. If other states offer me land at a lower price, I have no moral right to buy land in your State at a higher price.
F: I agree. But it seems that the govt. is a big loser from your car project.
A: No, that is not true at all. With the new car factory and activities linked to it, more employment, more income and more income tax and other revenues will be generated. Over a period of time the govt. will also benefit considerably.
F. I thought so. Thanks to your car project, every one in the State seems likely to be benefited, except a few who would have temporary difficulties and they can be assisted to tide over that transition phase. But no one seems to have used scientific methods to calculate the cost and benefits.
A: You are right.
F: It is because of the reluctance to apply scientific methods to calculate costs and benefits that we have heated controversies and bandhs? Also, such useless and costly controversies and bandhs may happen again and again when factories, townships, airports projects are proposed and the govt. has to go in for land acquisition. Each bandh is a cost to the society without any benefit: so are the protracted emotional debates in the media, the legislature’s offices and political propaganda meetings. All this is sheer wastage of national resources: money, paper, time and effort.
A: You are right. Maybe in democracy we have to bear this additional cost.
F: I do not agree with you, Sir. We are reluctant to use proper quantitative accounting of effects of alternative decisions. When we are in the political arena, our politicians and elite classes forget everything except counting of potential votes in favour or against, emotionally charged public speaking without any substance, and muscle power. Muscle power technology and street shouting technology are the pillars of our democracy: accounting technology is for other commercial business applications.
A: You have a brilliant idea. How did it occur to you? You are not a Chartered Accountant or MBA.
F: No, Sir. I am only a bachelor of commerce. It seems accountancy and accountability is not what our democracy likes to adapt to.
A: Good observation. We could discuss this if we meet again.
G: I am trying to comprehend the relevance of your story.
S: You should. Just think if two persons can have such a conversation on their own without much quantitative information, what were the political parties and their great leaders as also the govt. doing. Playing games at the cost of the society? But let my story end in a positive note, before we close this series of dialogue sessions:
F: You are a very old, reputed industry house with considerable focus on societal welfare. Why don’t you consider grant options to buy 10 shares of your car company per acre of land given to you by the farmers with an exercise price equal to your company’s market price as of 31st March 2009 and options exercisable between 31st March 2012 and 31st March 2015? With that the farmers will feel that they have an upside. This would prove that you have purchased the land with a greater measure of fairness.
A: Thank you for a novel suggestion. But I regret we have to hurry now. They have announced the last and final call for our boarding.
F: Yes, Sir. Thank you for spending some time with me.
A: I enjoyed the time with you. Good luck to you, young man. May our country be filled with citizens like you and you become
Saturday, May 2, 2009
Economics of Intellectual Property
G: Can we have one more global example of cause-effect obsession syndrome, cause-effect inverse and relevance of irrelevance?
S: Oh, sure. First, let us deal with what causes some people to seek right to intellectual property (IP) and its protection from being copied for commercial purposes. Those who have anything that is novel that they have designed or discovered or invented may have a need for IP protection. They want to make money from their own IP or at least want to get recognition for their contribution. Some of those who think and can demonstrate that they have created something novel and the use of that creation by others should be subject to their permission which they may grant at their discretion, if necessary against payment of some monetary consideration by those they have agreed to allow such use.
G: The cause is the desire on the part of the creator to benefit from his/ her creation and the effect is the demand for IP.
S: Yes. But there is an underlying reality that is not so explicitly stated. If X has invented something that can be successfully commercialized and money made without any possibility of copying on commercial scale by others, there is no need for IP protection. Unfortunately, for most creations copying is generally very easy. Therefore, restriction on copying is what is being sought. The cause-effect obsession syndrome starts then as follows: if you allow free copying no one will have incentive to create or innovate things that can help human society to progress. So, IP right is nothing but negation of human right to copy.
G: Right to copy!
S: Yes, freedom to copy can be regarded as a fundamental human right. Without copying human civilization cannot exist. From the childhood you learn to copy and parents urge you to copy them so that you can live. You must copy how to walk, how to keep yourself clean, how to eat and drink, how to talk, how to read, write and communicate, sing, dance and so on.
G: So, the cause-effect inverse here is that if you do not allow free copying right, human society cannot make progress. If I am not allowed to copy running and innovate as to how I can increase my speed of running, how do I catch a thieve running away stealing my money from my pocket?
S: You are right. That is why many creators themselves want that their creation be freely copied without any restriction. They enjoy that many people benefit by costless copying of their inventions. The greater is the incidence of copying the greater is their delight.
G: So, you are against copyright laws.
S: Please do not jump to conclusion without logical justification. I recognize the natural need and right to copy. I also agree to the need for copyright laws. If copyright laws are not there, authors will not write for a book, publishers will not publish books, music companies will not record songs, movies, dramas and events on tapes, audio/ video cassettes, compact disks etc. But despite all copyright and patent laws, we have official sales of recorded music industry falling behind the sales of illegal copying based pirated music distribution industry. A similar thing happens in pharmaceuticals industry. The official industry has to innovate to make unauthorised copying and piracy uneconomic and restricted. That is the technological and marketing challenge the official industry has to take up.
G: So, you say that both copyright and copying will continue.
S: Yes. But one should note that not all things that you see some other person do can be copied or at least easily copied by you or others. There are a few possibilities of copying: a novel creation can be easily copied sooner or later, or difficult to copy even after a long time, or almost impossible to copy in the foreseeable future. There are a few possibilities on the cost of creation: a novel creation without much cost (resource, time and/ or effort) or with substantial cost. For simplicity, we can have six possible combinations: (a) easy creation & easy copying, (b) easy creation but difficult copying, (c) easy creation and impossible to copy, (d) difficult creation and easy to copy, (e) difficult creation and difficult copying, and (f) difficult creation and impossible to copy. For (c) and (f) categories, there is no problem. Problem arises in the remaining four cases.
G: Creations of category (a) also does not pose any problem. For that which is easy to create, there is nothing that the first creator can demand to be compensated for. The same thing may have been created soon even if the first creator had not been the first to create.
S: You are right. Categories (b) and (e) also do not pose much of a problem because there is an embedded IP protection for quite some time, copying being difficult. Real problem arises in the case of (d) category creations: if you do not protect the commercial interest of inventions/ innovations that cost much time, effort and money but easy to copy, adequate effort and money may not be attracted to the creative process of innovations and inventions. As a result, the society may suffer from slower progress of the human society.
G: For (d), therefore everyone will agree to Intellectual Property Right (IPR) and IPR protection.
S: I also believe that everyone will agree.
G: Then where does the debate originate?
S: It arises from how the inventions or creations are classified as novel creations of category (d) and how long the protection is granted for them. Failure to identify creations of category (d) as such or inadequate protection period for such category creations may hurt the process of creations and therefore the interest of the creators and the progress of human society, though the copiers may be benefited.
G: On the other hand, creators of (a) category creations may try to show that their creations are category (d) creations. This will also hurt the process of innovations besides hurting the society’s interest.
S: You are right. Thus, the problem arises not with IPR protection as such but with the way the IPR protection is ensured in the case of (d) category creations: short, unambiguous laws on IPR, proper identification of IP creations of category (d), and the enforcement of such IPR. This clearly is not an easy task and cannot be handled of run-of-the-mill, ordinary bureaucrats. It requires highly perceptive scientist personnel capable of quick decisions on IPR protection applications and IPR protection intelligence and police personnel with adequate powers and accountability.
G: But this is an almost impossible task in large population countries with high propensity to copy clandestinely without paying the creators any consideration
S: Yes. That is why India and China may find it difficult to have strong and effective IPR regimes.
G: But there are non-profit foundations which do lot of collaborative research on the basis of what is called open source model of development as in the case of software development. These foundations and the people who participate in open source software and other scientific problem solving do not seem to worry about IPR or the pecuniary or reputation/ recognition prize rewards.
S: You are right. This is new model of development of science and technology is driven by motivations like the psychologically good feeling of being challenged by various unsolved problems or of being part of an open community of problem solvers or simply the scope of learning new things. Often, such open, collaborative efforts results in faster cracking of problems than the time taken by the closed door, secretive scientific and technological in-house research undertaken by company R&D and research institutions.
G: If that were so, why do we emphasize on IPR?
S: First, complete open source process of creative innovation and invention may not suit all areas of science and for large companies to depend on. Second, such open, collaborative efforts at problem sharing and problem solving may actually increase the efficiency of problem solving within companies and research institutions. Third, the open-source, collaborative efforts can also lead to new regimes for IPR protection laws. Those who participate in the open, collaborative processes may get something in the nature of free stock options: options in this case will be on the sharing of gains from patents based on collaborative generation of solutions to scientific and technological problems.
G: Ultimately, strong IPR regimes will help countries like India and China to gain faster.
S: Yes, relatively low income countries with large population of scientifically trained minds should do better by giving up the practice of copying and start participating in open source development of science and technology. It is a cause-effect obsession syndrome that leads us to believe that IPR protection is in the interest of already advanced, rich countries and multinational companies. When we look at open source process of scientific and technology research, we develop a cause-effect inversion. Then, we start seeing that effectively designed and implemented IPR regimes are relevant to poor countries like us: reliance on unauthorized copying the creations of foreign innovators and denying IPR to foreign innovators actually hurt countries like us more than the advanced Western countries.
G: But you can’t expect poor countries to spend huge amount of resources to innovate.
S: The issue is that can poorer countries remove their poverty through copying. Both the goal of lifting huge populations from poverty and the means of copying are wrong. The goal should have been to enable each of their citizens to become as rich as possible. If you aim low, you achieve only that. If you aim high, you apply your brain better and succeed. But whether you aim low or high is not within your choice. The means to achieve the goal should have been to allow creative and productive talents in science, technology and entrepreneurship inherent in human beings to flower.
G: How can poor, uneducated people identify and use their talents? You have to educate them first. That is why the State plans programs to do that.
S: State can only plan. The State cannot implement and get the results. People achieve the results individually and groups at their pace. Directing, controlling and cajoling them do not help. If State plans for the people, the people think that it is the State that has the responsibility for and capability of achieving what the State plans.
G: If the State does not arrange for economic and social development, who will?
S: You suffer from Cause-Effect Syndrome. You think planning is the cause and achievement of desired goals is the effect without any scientific basis. Did all inventions and discoveries in this World result from State planning? Confront the Cause-Effect Inverse by finding how state planning and initiative had caused the following effects: the proof that the Earth revolves around the Sun and the Sun does not revolve around the Earth, the discovery of the theory of relativity, the building of the first airplane, the use of the wireless technology, the development of the principles of management, the technique of double-entry book keeping, the popularity of cricket or soccer or Lawn Tennis all over World, the proliferation of amusement parks and shopping malls, the development of plastic money. State is irrelevant to the progress of human civilization.
G: But some States do better than others!
S: Yes, that happens because some States allow greater economic freedom to citizens and allows merit and talent to compete in exerting their influence on how the State functions. Such states may do better than other states that curb individual freedom, encourages acquiescence, rewards loyalty to the Ruling class and requires merit and talent to seek State patronage.
G: You mean to say that India’s economic development in the last 60 years was possible without the State’s direction, control and initiatives.
S: Whatever India or any other country has achieved so far is purely because of individual enterprise. The results achieved are not because, but in spite, of the adverse effect of State’s active meddling with economic affairs of the country.
G: Why do you say in spite of the State?
S: Because State planning and control has constrained the progress of education, dynamism of entrepreneurial risk taking, motivation to excel, and so on. When the whole World was available for Indians to acquire knowledge, to trade with and gain, to compete with and succeed, the Indian State ensured that the people of India live virtually isolated from the World. Economic freedom was snatched away from the citizens by the State in India. Citizens that live in economic serfdom perpetuated by the State’s over-riding power cannot deliver outstanding results on a sustained basis.
G: Why did India choose the State-ist model, if what you say is true.
S: There is one and only one reason: You choose as your nature permits you. That’s getting back to Stochastic Destiny Principle, as you would like to point out.
G: But since the economic liberalization started in 1991, India has become less Statist.
S: That is your illusion. Instead of a fixed short chain that you tug in the neck-collar of the dog you can use an expandable-and-contractible leash chain also. That is not freedom.
G: How is this relevant to IPR. You have a tendency to digress!
S: This is another example of the Relevance of the Irrelevance. When you are so obsessed with State-ism, you cannot imagine the potential of economic freedom to the citizens. Unless the individuals are free, exploitation of creativity is constrained. The citizens are forced to copy rather than innovate since the State does not believe in IPR.
G: But we have copyrights and patents since long.
S: Yes, some legislation exited till the recent changes took place. But we know how high has been the incidence of violation of copyrights, trademarks and patents as also the extent of piracy in recorded audio/ videotapes and CDs, drugs, automobile spares and so on.
G: In such a huge country, enforcement is not an easy task.
S: It all depends whether one chooses to be equal to the task. One makes choice one is naturally inclined to make. That’s your destiny. But that does not justify the poor enforcement record. Poor IPR laws and poor enforcement encourages copying, breeds mediocrity, discourages innovations and kills motivation to excel, which hurts economic and social progress. Copying clandestinely, according to me, is an activity of people with low self-esteem.
G: If you are poor, you are prone to copying.
S: You are right. Some poor people find no alternative but to steal to live their lives. Some other poor people organize muscle power to become bandits to commit robbery or become terrorists. Some other poor people just tolerate their poverty. It all depends on the natural inclinations of the individuals. Violation of copy rights, trademarks and patent laws, however, are committed generally by rich people, even if they belong to poor countries.
G: You do not seem to be interested in prescribing solutions.
S: Prescribing solution is easy. In fact, our discussions point to alternative solutions. The responsibility of choosing a particular solution and the success or failure of a chosen solution lies only with those who want to solve the problem. They choose according to their natural inclinations. That is in accordance of the stochastic destiny principle.
G: As usual, we have to close this session without reaching an agreement.
S: Oh, sure. First, let us deal with what causes some people to seek right to intellectual property (IP) and its protection from being copied for commercial purposes. Those who have anything that is novel that they have designed or discovered or invented may have a need for IP protection. They want to make money from their own IP or at least want to get recognition for their contribution. Some of those who think and can demonstrate that they have created something novel and the use of that creation by others should be subject to their permission which they may grant at their discretion, if necessary against payment of some monetary consideration by those they have agreed to allow such use.
G: The cause is the desire on the part of the creator to benefit from his/ her creation and the effect is the demand for IP.
S: Yes. But there is an underlying reality that is not so explicitly stated. If X has invented something that can be successfully commercialized and money made without any possibility of copying on commercial scale by others, there is no need for IP protection. Unfortunately, for most creations copying is generally very easy. Therefore, restriction on copying is what is being sought. The cause-effect obsession syndrome starts then as follows: if you allow free copying no one will have incentive to create or innovate things that can help human society to progress. So, IP right is nothing but negation of human right to copy.
G: Right to copy!
S: Yes, freedom to copy can be regarded as a fundamental human right. Without copying human civilization cannot exist. From the childhood you learn to copy and parents urge you to copy them so that you can live. You must copy how to walk, how to keep yourself clean, how to eat and drink, how to talk, how to read, write and communicate, sing, dance and so on.
G: So, the cause-effect inverse here is that if you do not allow free copying right, human society cannot make progress. If I am not allowed to copy running and innovate as to how I can increase my speed of running, how do I catch a thieve running away stealing my money from my pocket?
S: You are right. That is why many creators themselves want that their creation be freely copied without any restriction. They enjoy that many people benefit by costless copying of their inventions. The greater is the incidence of copying the greater is their delight.
G: So, you are against copyright laws.
S: Please do not jump to conclusion without logical justification. I recognize the natural need and right to copy. I also agree to the need for copyright laws. If copyright laws are not there, authors will not write for a book, publishers will not publish books, music companies will not record songs, movies, dramas and events on tapes, audio/ video cassettes, compact disks etc. But despite all copyright and patent laws, we have official sales of recorded music industry falling behind the sales of illegal copying based pirated music distribution industry. A similar thing happens in pharmaceuticals industry. The official industry has to innovate to make unauthorised copying and piracy uneconomic and restricted. That is the technological and marketing challenge the official industry has to take up.
G: So, you say that both copyright and copying will continue.
S: Yes. But one should note that not all things that you see some other person do can be copied or at least easily copied by you or others. There are a few possibilities of copying: a novel creation can be easily copied sooner or later, or difficult to copy even after a long time, or almost impossible to copy in the foreseeable future. There are a few possibilities on the cost of creation: a novel creation without much cost (resource, time and/ or effort) or with substantial cost. For simplicity, we can have six possible combinations: (a) easy creation & easy copying, (b) easy creation but difficult copying, (c) easy creation and impossible to copy, (d) difficult creation and easy to copy, (e) difficult creation and difficult copying, and (f) difficult creation and impossible to copy. For (c) and (f) categories, there is no problem. Problem arises in the remaining four cases.
G: Creations of category (a) also does not pose any problem. For that which is easy to create, there is nothing that the first creator can demand to be compensated for. The same thing may have been created soon even if the first creator had not been the first to create.
S: You are right. Categories (b) and (e) also do not pose much of a problem because there is an embedded IP protection for quite some time, copying being difficult. Real problem arises in the case of (d) category creations: if you do not protect the commercial interest of inventions/ innovations that cost much time, effort and money but easy to copy, adequate effort and money may not be attracted to the creative process of innovations and inventions. As a result, the society may suffer from slower progress of the human society.
G: For (d), therefore everyone will agree to Intellectual Property Right (IPR) and IPR protection.
S: I also believe that everyone will agree.
G: Then where does the debate originate?
S: It arises from how the inventions or creations are classified as novel creations of category (d) and how long the protection is granted for them. Failure to identify creations of category (d) as such or inadequate protection period for such category creations may hurt the process of creations and therefore the interest of the creators and the progress of human society, though the copiers may be benefited.
G: On the other hand, creators of (a) category creations may try to show that their creations are category (d) creations. This will also hurt the process of innovations besides hurting the society’s interest.
S: You are right. Thus, the problem arises not with IPR protection as such but with the way the IPR protection is ensured in the case of (d) category creations: short, unambiguous laws on IPR, proper identification of IP creations of category (d), and the enforcement of such IPR. This clearly is not an easy task and cannot be handled of run-of-the-mill, ordinary bureaucrats. It requires highly perceptive scientist personnel capable of quick decisions on IPR protection applications and IPR protection intelligence and police personnel with adequate powers and accountability.
G: But this is an almost impossible task in large population countries with high propensity to copy clandestinely without paying the creators any consideration
S: Yes. That is why India and China may find it difficult to have strong and effective IPR regimes.
G: But there are non-profit foundations which do lot of collaborative research on the basis of what is called open source model of development as in the case of software development. These foundations and the people who participate in open source software and other scientific problem solving do not seem to worry about IPR or the pecuniary or reputation/ recognition prize rewards.
S: You are right. This is new model of development of science and technology is driven by motivations like the psychologically good feeling of being challenged by various unsolved problems or of being part of an open community of problem solvers or simply the scope of learning new things. Often, such open, collaborative efforts results in faster cracking of problems than the time taken by the closed door, secretive scientific and technological in-house research undertaken by company R&D and research institutions.
G: If that were so, why do we emphasize on IPR?
S: First, complete open source process of creative innovation and invention may not suit all areas of science and for large companies to depend on. Second, such open, collaborative efforts at problem sharing and problem solving may actually increase the efficiency of problem solving within companies and research institutions. Third, the open-source, collaborative efforts can also lead to new regimes for IPR protection laws. Those who participate in the open, collaborative processes may get something in the nature of free stock options: options in this case will be on the sharing of gains from patents based on collaborative generation of solutions to scientific and technological problems.
G: Ultimately, strong IPR regimes will help countries like India and China to gain faster.
S: Yes, relatively low income countries with large population of scientifically trained minds should do better by giving up the practice of copying and start participating in open source development of science and technology. It is a cause-effect obsession syndrome that leads us to believe that IPR protection is in the interest of already advanced, rich countries and multinational companies. When we look at open source process of scientific and technology research, we develop a cause-effect inversion. Then, we start seeing that effectively designed and implemented IPR regimes are relevant to poor countries like us: reliance on unauthorized copying the creations of foreign innovators and denying IPR to foreign innovators actually hurt countries like us more than the advanced Western countries.
G: But you can’t expect poor countries to spend huge amount of resources to innovate.
S: The issue is that can poorer countries remove their poverty through copying. Both the goal of lifting huge populations from poverty and the means of copying are wrong. The goal should have been to enable each of their citizens to become as rich as possible. If you aim low, you achieve only that. If you aim high, you apply your brain better and succeed. But whether you aim low or high is not within your choice. The means to achieve the goal should have been to allow creative and productive talents in science, technology and entrepreneurship inherent in human beings to flower.
G: How can poor, uneducated people identify and use their talents? You have to educate them first. That is why the State plans programs to do that.
S: State can only plan. The State cannot implement and get the results. People achieve the results individually and groups at their pace. Directing, controlling and cajoling them do not help. If State plans for the people, the people think that it is the State that has the responsibility for and capability of achieving what the State plans.
G: If the State does not arrange for economic and social development, who will?
S: You suffer from Cause-Effect Syndrome. You think planning is the cause and achievement of desired goals is the effect without any scientific basis. Did all inventions and discoveries in this World result from State planning? Confront the Cause-Effect Inverse by finding how state planning and initiative had caused the following effects: the proof that the Earth revolves around the Sun and the Sun does not revolve around the Earth, the discovery of the theory of relativity, the building of the first airplane, the use of the wireless technology, the development of the principles of management, the technique of double-entry book keeping, the popularity of cricket or soccer or Lawn Tennis all over World, the proliferation of amusement parks and shopping malls, the development of plastic money. State is irrelevant to the progress of human civilization.
G: But some States do better than others!
S: Yes, that happens because some States allow greater economic freedom to citizens and allows merit and talent to compete in exerting their influence on how the State functions. Such states may do better than other states that curb individual freedom, encourages acquiescence, rewards loyalty to the Ruling class and requires merit and talent to seek State patronage.
G: You mean to say that India’s economic development in the last 60 years was possible without the State’s direction, control and initiatives.
S: Whatever India or any other country has achieved so far is purely because of individual enterprise. The results achieved are not because, but in spite, of the adverse effect of State’s active meddling with economic affairs of the country.
G: Why do you say in spite of the State?
S: Because State planning and control has constrained the progress of education, dynamism of entrepreneurial risk taking, motivation to excel, and so on. When the whole World was available for Indians to acquire knowledge, to trade with and gain, to compete with and succeed, the Indian State ensured that the people of India live virtually isolated from the World. Economic freedom was snatched away from the citizens by the State in India. Citizens that live in economic serfdom perpetuated by the State’s over-riding power cannot deliver outstanding results on a sustained basis.
G: Why did India choose the State-ist model, if what you say is true.
S: There is one and only one reason: You choose as your nature permits you. That’s getting back to Stochastic Destiny Principle, as you would like to point out.
G: But since the economic liberalization started in 1991, India has become less Statist.
S: That is your illusion. Instead of a fixed short chain that you tug in the neck-collar of the dog you can use an expandable-and-contractible leash chain also. That is not freedom.
G: How is this relevant to IPR. You have a tendency to digress!
S: This is another example of the Relevance of the Irrelevance. When you are so obsessed with State-ism, you cannot imagine the potential of economic freedom to the citizens. Unless the individuals are free, exploitation of creativity is constrained. The citizens are forced to copy rather than innovate since the State does not believe in IPR.
G: But we have copyrights and patents since long.
S: Yes, some legislation exited till the recent changes took place. But we know how high has been the incidence of violation of copyrights, trademarks and patents as also the extent of piracy in recorded audio/ videotapes and CDs, drugs, automobile spares and so on.
G: In such a huge country, enforcement is not an easy task.
S: It all depends whether one chooses to be equal to the task. One makes choice one is naturally inclined to make. That’s your destiny. But that does not justify the poor enforcement record. Poor IPR laws and poor enforcement encourages copying, breeds mediocrity, discourages innovations and kills motivation to excel, which hurts economic and social progress. Copying clandestinely, according to me, is an activity of people with low self-esteem.
G: If you are poor, you are prone to copying.
S: You are right. Some poor people find no alternative but to steal to live their lives. Some other poor people organize muscle power to become bandits to commit robbery or become terrorists. Some other poor people just tolerate their poverty. It all depends on the natural inclinations of the individuals. Violation of copy rights, trademarks and patent laws, however, are committed generally by rich people, even if they belong to poor countries.
G: You do not seem to be interested in prescribing solutions.
S: Prescribing solution is easy. In fact, our discussions point to alternative solutions. The responsibility of choosing a particular solution and the success or failure of a chosen solution lies only with those who want to solve the problem. They choose according to their natural inclinations. That is in accordance of the stochastic destiny principle.
G: As usual, we have to close this session without reaching an agreement.
Economics by Ecology and Environment Phobia
S: Should we discuss the example of the worldwide concern about protection of ecology and environment?
G: In such a straightforward issue, I do not think there can be any debate. The way human beings are exploiting natural resources, the World is heading towards an ecological and environmental disaster.
S: So, you mean that protection of environment and ecology is relevant to everyone.
G: Yes. This is the relevant perspective for everyone.
S: You want to say that everyone in the World know the scientific truth about how human beings are exploiting the environment and the non-renewable natural resources. This is first cause-effect relationship you depend on. Then you want to say that since everyone’s life and the lives of the future generations are at stake due to environment pollution and ecological damages being caused by human behaviour, everyone should be concerned. That is another cause-effect relationship you invoke. That is why you say that Environment and ecology concerns are relevant to everyone or the human society.
G: You got me correctly. That is what I want to say.
S: Unfortunately, you are wrong. First, everyone in the World does not know the scientific truth about human behaviour and environmental and ecological disaster. Only some people know.
G: Yes. If some people know the scientific truth, that is enough. All persons may not know at a given point. But truth is truth. Truth implies that human beings should change their behaviour. It is suffient if some persons who matter and have the power, know the truth t.
S: That’s how you perceive. But for those who do not know the truth, your perspective is irrelevant. Second, even if everyone knew the scientific truth, not all are interested in protecting the future. In fact many may not have any view about the future after their death.
G: Yes, some persons are very selfish. They do not care about the future generations. They are fools. They are not relevant.
S: Correct. For these people, your perspective is irrelevant. Let us assume for your sake, that everyone knows the scientific truth and are not selfish and care for future generations’ welfare. Still, the issue may not be relevant to some of them because they do not know what solution will change human behaviour.
G: Human beings should to try to find out solutions. That is why I think what I say is relevant to all who knows the truth. It is most relevant for the knowledgable culprit. It is the economically advanced West that is responsible for exploiting the environment and ecology in a non-sustainable and damaging way..
S: I do not agree with you. The debate on this subject will continue for long, if not ever, again and again. For that is the way Nature’s laws operate. There will be crises coming again and again because of the natural greed of human beings and consequential Natural Resource exploitation on a massive scale in ways that hurt the ecology and the environment.
G: So, you seem to agree
S: No. I do not agree with you. The ultimate disaster is not round the corner. Human beings will not be an extinct species in a short while. Human beings will continue to be doing other things in the meanwhile: invent technologies and changing life styles that will reduce the dependence on exhaustible natural resources, increase the use of renewable natural resources, increase the efficiencies of the use of natural resources, conserve ecology and protect environment as well as make possible comfortable living in adversely changing ecological and environmental conditions. We therefore need not anticipate a complete devastation in the foreseeable future.
G: You seem to have great faith on human capability to innovate, invent and adjust. But the West, particularly America seems to be interested in making the environment progressively adverse to normal, healthy human existence.
S: I do not agree that the West or America will continue to be the major contributors to ecological and environmental problems of the World today. The major contributors will soon be just two countries, China and India. They are poor and is on rapid growth trajectory. Their consumption of materials will bulge simply because of their size of population. If at all, it is the West that will come out with more efficient technological solutions to achieving rapid economic growth with less environment-polluting effect. In the meanwhile, we expect advanced countries to slip down the lower standards of living? We want to say that “ Hi, country ‘X’. You have enriched yourselves in the past by polluting environment and hurting ecological balance. Now, you stop. It is our turn to become rich by damaging the environment and ecology. We want reservation of less rich countries like us in future entitlement to pollute environment and contribute to ecological disaster”. Does this seem logical, rational, consistent or scientific?
G: Yes, we should get our turn! But we are not so mean. Rather we would like to work towards environmental and ecological protection. Let the West reduce its exploitation and consumption of natural resources in a manner that reduces depletion of finite stock of non-renewable sources of energy and other materials. Let them reduce pollution and protect environment. This will allow poor countries to consume more of such resources to grow fast economically.
S: Extra-ordinarily brilliant logic. The only problem is the relevant has become irrelevant here.
G: How?
S: It is known that earth has a finite stock of non-renewable natural resources. You want a fair distribution of each of these among all the people in the World. So, you may think of dividing each natural resource equally to each person irrespective of where the resource is located and where each person is located. As if, for each natural resource, you have a giant international company that has issued equal number of its shares to each person in this world. But then how do you deal with people of subsequent generations and the growth of population? You cannot solve this problem. Even if you had overcome this problem somehow, you face another problem. How do you take account for the exploitation of past generations that had exploited these resources? Better forget the past. Start fresh now. How do the shareholders use their shares to buy the natural resource they want to consume? So, you allow for trading in these shares and you allow a free international market for each natural resource to develop.
G: But markets are not always efficient and fair.
S: So, you would most likely suggest that we appoint some World Government or international democratic forum to solve the problem. But you cannot because you are tied to your nationality and you will need to develop of a system bureaucracy to deal with International Dispute resolution. That can be more inefficient and unfair than the market system. Your statist, bureaucratic efforts are as much a natural force as the free competitive market system. The actual outcomes may depend on the interaction of these forces.
G: You seem to believe that human beings cannot design and implement a more efficient and less unfair system than the natural system or free market system!
S: I do because that is the hard truth. The cause-effect paradigm leads you to the conclusion that extravagant exploitation of non-renewable natural resources and inefficient use of such materials affects ecology and environment. That is what you have observed from past history. But that does not necessary imply that the rich nations are doing just that, unless you have a cause-effect obsession syndrome. You want advanced West to reduce their contribution to pollution and allow emerging economies to increase their contribution to pollution. So, you fix standards, start carbon credit and start trading in carbon credit. That is a good market system idea, but that cannot solve your basic problem. Ideally, you want an overall absolute limit on each kind of pollution that human beings generate per year or per decade and you want each human being in the world to have the right to pollute only up to a limit determined by the overall absolute limit divided by the total human population. But, this seems so funny that you create the right or entitlement to pollute environment. And, you want to have larger entitlement for Indians and Chinese to pollute!
G: I see the point you are trying to make. It looks so silly. But as human beings we have to do something.
S: That is what you are naturally inclined to believe. Doing something is not necessarily better than doing nothing! Of course, people like you will try to do this. You will do this because of Natural Law that is playing out through your nature and inclination. But other natural forces will also operate. They will operate directly or through other persons with inclinations different from you. The future will be result of interaction of different natural forces. You cannot achieve anything better than what Nature allows you to do.
G: You are coming back to your stochastic destiny principle again.
S: You are absolutely right: that is the ultimate truth. Creation and destruction are natural processes that cannot be controlled by the mere wish of human beings except by chance.
G: But we must be concerned with ecology and environment when we know the truth.
S: If you are by nature inclined that way, you will do just that. In fact, it is the western world that shows greater concern than the poor countries. So the poorer countries want to preach that the already rich countries should develop technologies that would protect ecology and environment. And, they want a fair share of the entitlement to damage ecology and environment.
G: They should.
S: They need not. If we are so concerned with ecology and environment, each one of us should be completely avoiding doing anything that is scientifically proven to have an adverse effect on the environment and ecology. There is no need to seek greater entitlement to damaging environment and ecology. But human beings are naturally conditioned to pick up fights because of self-interest and jealousy. For that you do not need to demonstrate your ability for reasoned argumentation.
G: Are you trying to make an oblique reference to my identity of “ Argumentative Indian”, a la Nobel Laureate Amartya Sen.
S: If you think that to be argumentative is a great characteristic, you should be proud of such an identity.
G: Isn’t argumentative a great characteristic?
S: It’s for you to value your characteristics. For me all characteristics are great and powerful: they can lead to great creations as well as destructions. I maybe thankful for just being what I happen to be as a result of the interaction of different natural forces in the past. But past is no more relevant to me except as a pleasurable trip back in time or tools of my natural tendency to play the game of reasoning and analysis. Past, in its various parts, has been contributing to making what I am and what I will be in future. Past is not relevant to me: it is the process that yields the present that I am.
G: You mean to say that you are not an argumentative Indian?
S: I am all that Indians commonly features. I am as argumentative as an Indian can be. But I am also as acquiescent as an Indian can be. I am as religious as an Indian can be. I am as Western as an Indian can be. There is no particular Indian that I think dominates me all the time. The exact process in which the past centuries and millenniums have contributed in my making is not known to me. I cannot be proud about anything that I have not myself done. I can only be thankful to the past.
G: But in our discussion, being argumentative is relevant.
S: I agree. But being argumentative does not necessarily mean that we are rational and reasonable human beings. Being argumentative is not necessarily a virtue. It may merely be a form of easily accessible communication that avoids physical fight, avoids violence to settle disputes and that help people to learn if they wish to learn.
G: Hold on. We have been in argumentative mode since long time. Now you say that we are not rational, reasonable human beings!
S: See. Let us not mix up things, though this is so natural for argumentative people to do.
We are trying to be rational as far as we can. That’s what human beings can do. We cannot ensure rationality. Consider the fact that poorer nations like India and China want to grow fast and catch up with the advanced richer countries, for which they need to consume great amounts of hydro-carbon fuels and thereby inflict a damage to ecology and environment. To minimize the overall damage, the current rate of damage by richer countries therefore needs to be brought down. That is argument for fair sharing of entitlement to damaging environment to ecology and environment.
G: That is true. The richer nations, particularly the USA cannot be allowed to inflict such huge damage as they are doing every year now.
S: This type of argumentation will not solve a dispute. This is another example of Cause-Effect Obsession Syndrome. If the dispute and the poor claim entitlement to damage based on population, argumentation of this type will soon end and yield to settlement through wars by the use of money, muscle, technology and intellect. That is what is natural and happening even now.
G: So, you are saying that scientific reasoning with the rich countries will fail to change their behaviour.
S: They will change their behaviour in their own interest, not because of the argument put up by poorer nations. They know that the stock of minerals and fossil fuels are finite and hence will try to find out ways of getting more of their needs per unit of energy or any finite natural resource.They may even accommodate the poor nations out of sympathy. Your argument is flawed and irrelevant to solving the ecological and environmental problem of the World.
G: Why do you say so? You do not agree to fair sharing?
S: To feed the billions of Indian and Chinese, if we use chemicals fertilizers and pesticides, we will hurt ecology and environment more. If we do not want to use polluting chemicals to feed the billions and give them decent dwellings, we will need to cut down forest cover and damage ecology and environment. No civilized person will raise the question as to why poor nations dramatically cut down on their population by half. You can’t stop producing more and more poor people. You do not think of fair sharing of the entitlement to produce numbers and burden our planet.
G: That kind of argument is hitting below the belt.
S: No. It’s the Cause-Effect Inverse to expose the Cause-Effect Obsession Syndrome from which one suffers and as a result produces invalid, biased arguments. You do not like that the issue of population size and its impact on environment and ecology because that is your weakness. If you had fewer numbers to deal with, you would have required much less of energy and materials to make them rich. But even with huge populations, you still like to imitate the life-styles of the rich West and its extravagant use of finite resources that leads to ecological and environmental damage.
G: Then, what is the solution?
S: I do not know. But mere argumentation cannot solve the problem so long as you argue only to promote your interest at the cost of others. That’s not reasoned argumentation; it is mere shouting. You know how much water billions of poor people will require when they become rich. You know how much of non- biodegradable plastic material waste they will generate to damage ecology. Yet you cry that the rich waste is unfair!
G: What then is the alternative?
S: There is nothing. There is no choice. You are destined to shout thinking that you have strong reasoned arguments when actually you really do not have any argument to justify your existence that burdens this planet. That is the natural law operating through you. You produce more poor people and when by natural consequence they become terrorists you justify the growth of terrorism by blaming the extravaganza of the rich West. That poor countries suffer is relevant but their argumentation is irrelevant so far as ecology and environment is concerned.
S: You are saying that whether poor countries remain poor or become rich, disaster is unavoidable.
G: Yes, that is the inevitable unless Nature reveals the solution by enabling scientists and technologists to find new technologies that remove the current constraint on resource availability and environmental and ecological impact of resource use.
G: In such a straightforward issue, I do not think there can be any debate. The way human beings are exploiting natural resources, the World is heading towards an ecological and environmental disaster.
S: So, you mean that protection of environment and ecology is relevant to everyone.
G: Yes. This is the relevant perspective for everyone.
S: You want to say that everyone in the World know the scientific truth about how human beings are exploiting the environment and the non-renewable natural resources. This is first cause-effect relationship you depend on. Then you want to say that since everyone’s life and the lives of the future generations are at stake due to environment pollution and ecological damages being caused by human behaviour, everyone should be concerned. That is another cause-effect relationship you invoke. That is why you say that Environment and ecology concerns are relevant to everyone or the human society.
G: You got me correctly. That is what I want to say.
S: Unfortunately, you are wrong. First, everyone in the World does not know the scientific truth about human behaviour and environmental and ecological disaster. Only some people know.
G: Yes. If some people know the scientific truth, that is enough. All persons may not know at a given point. But truth is truth. Truth implies that human beings should change their behaviour. It is suffient if some persons who matter and have the power, know the truth t.
S: That’s how you perceive. But for those who do not know the truth, your perspective is irrelevant. Second, even if everyone knew the scientific truth, not all are interested in protecting the future. In fact many may not have any view about the future after their death.
G: Yes, some persons are very selfish. They do not care about the future generations. They are fools. They are not relevant.
S: Correct. For these people, your perspective is irrelevant. Let us assume for your sake, that everyone knows the scientific truth and are not selfish and care for future generations’ welfare. Still, the issue may not be relevant to some of them because they do not know what solution will change human behaviour.
G: Human beings should to try to find out solutions. That is why I think what I say is relevant to all who knows the truth. It is most relevant for the knowledgable culprit. It is the economically advanced West that is responsible for exploiting the environment and ecology in a non-sustainable and damaging way..
S: I do not agree with you. The debate on this subject will continue for long, if not ever, again and again. For that is the way Nature’s laws operate. There will be crises coming again and again because of the natural greed of human beings and consequential Natural Resource exploitation on a massive scale in ways that hurt the ecology and the environment.
G: So, you seem to agree
S: No. I do not agree with you. The ultimate disaster is not round the corner. Human beings will not be an extinct species in a short while. Human beings will continue to be doing other things in the meanwhile: invent technologies and changing life styles that will reduce the dependence on exhaustible natural resources, increase the use of renewable natural resources, increase the efficiencies of the use of natural resources, conserve ecology and protect environment as well as make possible comfortable living in adversely changing ecological and environmental conditions. We therefore need not anticipate a complete devastation in the foreseeable future.
G: You seem to have great faith on human capability to innovate, invent and adjust. But the West, particularly America seems to be interested in making the environment progressively adverse to normal, healthy human existence.
S: I do not agree that the West or America will continue to be the major contributors to ecological and environmental problems of the World today. The major contributors will soon be just two countries, China and India. They are poor and is on rapid growth trajectory. Their consumption of materials will bulge simply because of their size of population. If at all, it is the West that will come out with more efficient technological solutions to achieving rapid economic growth with less environment-polluting effect. In the meanwhile, we expect advanced countries to slip down the lower standards of living? We want to say that “ Hi, country ‘X’. You have enriched yourselves in the past by polluting environment and hurting ecological balance. Now, you stop. It is our turn to become rich by damaging the environment and ecology. We want reservation of less rich countries like us in future entitlement to pollute environment and contribute to ecological disaster”. Does this seem logical, rational, consistent or scientific?
G: Yes, we should get our turn! But we are not so mean. Rather we would like to work towards environmental and ecological protection. Let the West reduce its exploitation and consumption of natural resources in a manner that reduces depletion of finite stock of non-renewable sources of energy and other materials. Let them reduce pollution and protect environment. This will allow poor countries to consume more of such resources to grow fast economically.
S: Extra-ordinarily brilliant logic. The only problem is the relevant has become irrelevant here.
G: How?
S: It is known that earth has a finite stock of non-renewable natural resources. You want a fair distribution of each of these among all the people in the World. So, you may think of dividing each natural resource equally to each person irrespective of where the resource is located and where each person is located. As if, for each natural resource, you have a giant international company that has issued equal number of its shares to each person in this world. But then how do you deal with people of subsequent generations and the growth of population? You cannot solve this problem. Even if you had overcome this problem somehow, you face another problem. How do you take account for the exploitation of past generations that had exploited these resources? Better forget the past. Start fresh now. How do the shareholders use their shares to buy the natural resource they want to consume? So, you allow for trading in these shares and you allow a free international market for each natural resource to develop.
G: But markets are not always efficient and fair.
S: So, you would most likely suggest that we appoint some World Government or international democratic forum to solve the problem. But you cannot because you are tied to your nationality and you will need to develop of a system bureaucracy to deal with International Dispute resolution. That can be more inefficient and unfair than the market system. Your statist, bureaucratic efforts are as much a natural force as the free competitive market system. The actual outcomes may depend on the interaction of these forces.
G: You seem to believe that human beings cannot design and implement a more efficient and less unfair system than the natural system or free market system!
S: I do because that is the hard truth. The cause-effect paradigm leads you to the conclusion that extravagant exploitation of non-renewable natural resources and inefficient use of such materials affects ecology and environment. That is what you have observed from past history. But that does not necessary imply that the rich nations are doing just that, unless you have a cause-effect obsession syndrome. You want advanced West to reduce their contribution to pollution and allow emerging economies to increase their contribution to pollution. So, you fix standards, start carbon credit and start trading in carbon credit. That is a good market system idea, but that cannot solve your basic problem. Ideally, you want an overall absolute limit on each kind of pollution that human beings generate per year or per decade and you want each human being in the world to have the right to pollute only up to a limit determined by the overall absolute limit divided by the total human population. But, this seems so funny that you create the right or entitlement to pollute environment. And, you want to have larger entitlement for Indians and Chinese to pollute!
G: I see the point you are trying to make. It looks so silly. But as human beings we have to do something.
S: That is what you are naturally inclined to believe. Doing something is not necessarily better than doing nothing! Of course, people like you will try to do this. You will do this because of Natural Law that is playing out through your nature and inclination. But other natural forces will also operate. They will operate directly or through other persons with inclinations different from you. The future will be result of interaction of different natural forces. You cannot achieve anything better than what Nature allows you to do.
G: You are coming back to your stochastic destiny principle again.
S: You are absolutely right: that is the ultimate truth. Creation and destruction are natural processes that cannot be controlled by the mere wish of human beings except by chance.
G: But we must be concerned with ecology and environment when we know the truth.
S: If you are by nature inclined that way, you will do just that. In fact, it is the western world that shows greater concern than the poor countries. So the poorer countries want to preach that the already rich countries should develop technologies that would protect ecology and environment. And, they want a fair share of the entitlement to damage ecology and environment.
G: They should.
S: They need not. If we are so concerned with ecology and environment, each one of us should be completely avoiding doing anything that is scientifically proven to have an adverse effect on the environment and ecology. There is no need to seek greater entitlement to damaging environment and ecology. But human beings are naturally conditioned to pick up fights because of self-interest and jealousy. For that you do not need to demonstrate your ability for reasoned argumentation.
G: Are you trying to make an oblique reference to my identity of “ Argumentative Indian”, a la Nobel Laureate Amartya Sen.
S: If you think that to be argumentative is a great characteristic, you should be proud of such an identity.
G: Isn’t argumentative a great characteristic?
S: It’s for you to value your characteristics. For me all characteristics are great and powerful: they can lead to great creations as well as destructions. I maybe thankful for just being what I happen to be as a result of the interaction of different natural forces in the past. But past is no more relevant to me except as a pleasurable trip back in time or tools of my natural tendency to play the game of reasoning and analysis. Past, in its various parts, has been contributing to making what I am and what I will be in future. Past is not relevant to me: it is the process that yields the present that I am.
G: You mean to say that you are not an argumentative Indian?
S: I am all that Indians commonly features. I am as argumentative as an Indian can be. But I am also as acquiescent as an Indian can be. I am as religious as an Indian can be. I am as Western as an Indian can be. There is no particular Indian that I think dominates me all the time. The exact process in which the past centuries and millenniums have contributed in my making is not known to me. I cannot be proud about anything that I have not myself done. I can only be thankful to the past.
G: But in our discussion, being argumentative is relevant.
S: I agree. But being argumentative does not necessarily mean that we are rational and reasonable human beings. Being argumentative is not necessarily a virtue. It may merely be a form of easily accessible communication that avoids physical fight, avoids violence to settle disputes and that help people to learn if they wish to learn.
G: Hold on. We have been in argumentative mode since long time. Now you say that we are not rational, reasonable human beings!
S: See. Let us not mix up things, though this is so natural for argumentative people to do.
We are trying to be rational as far as we can. That’s what human beings can do. We cannot ensure rationality. Consider the fact that poorer nations like India and China want to grow fast and catch up with the advanced richer countries, for which they need to consume great amounts of hydro-carbon fuels and thereby inflict a damage to ecology and environment. To minimize the overall damage, the current rate of damage by richer countries therefore needs to be brought down. That is argument for fair sharing of entitlement to damaging environment to ecology and environment.
G: That is true. The richer nations, particularly the USA cannot be allowed to inflict such huge damage as they are doing every year now.
S: This type of argumentation will not solve a dispute. This is another example of Cause-Effect Obsession Syndrome. If the dispute and the poor claim entitlement to damage based on population, argumentation of this type will soon end and yield to settlement through wars by the use of money, muscle, technology and intellect. That is what is natural and happening even now.
G: So, you are saying that scientific reasoning with the rich countries will fail to change their behaviour.
S: They will change their behaviour in their own interest, not because of the argument put up by poorer nations. They know that the stock of minerals and fossil fuels are finite and hence will try to find out ways of getting more of their needs per unit of energy or any finite natural resource.They may even accommodate the poor nations out of sympathy. Your argument is flawed and irrelevant to solving the ecological and environmental problem of the World.
G: Why do you say so? You do not agree to fair sharing?
S: To feed the billions of Indian and Chinese, if we use chemicals fertilizers and pesticides, we will hurt ecology and environment more. If we do not want to use polluting chemicals to feed the billions and give them decent dwellings, we will need to cut down forest cover and damage ecology and environment. No civilized person will raise the question as to why poor nations dramatically cut down on their population by half. You can’t stop producing more and more poor people. You do not think of fair sharing of the entitlement to produce numbers and burden our planet.
G: That kind of argument is hitting below the belt.
S: No. It’s the Cause-Effect Inverse to expose the Cause-Effect Obsession Syndrome from which one suffers and as a result produces invalid, biased arguments. You do not like that the issue of population size and its impact on environment and ecology because that is your weakness. If you had fewer numbers to deal with, you would have required much less of energy and materials to make them rich. But even with huge populations, you still like to imitate the life-styles of the rich West and its extravagant use of finite resources that leads to ecological and environmental damage.
G: Then, what is the solution?
S: I do not know. But mere argumentation cannot solve the problem so long as you argue only to promote your interest at the cost of others. That’s not reasoned argumentation; it is mere shouting. You know how much water billions of poor people will require when they become rich. You know how much of non- biodegradable plastic material waste they will generate to damage ecology. Yet you cry that the rich waste is unfair!
G: What then is the alternative?
S: There is nothing. There is no choice. You are destined to shout thinking that you have strong reasoned arguments when actually you really do not have any argument to justify your existence that burdens this planet. That is the natural law operating through you. You produce more poor people and when by natural consequence they become terrorists you justify the growth of terrorism by blaming the extravaganza of the rich West. That poor countries suffer is relevant but their argumentation is irrelevant so far as ecology and environment is concerned.
S: You are saying that whether poor countries remain poor or become rich, disaster is unavoidable.
G: Yes, that is the inevitable unless Nature reveals the solution by enabling scientists and technologists to find new technologies that remove the current constraint on resource availability and environmental and ecological impact of resource use.
Economics As it Suits One
G: It is difficult to understand the distinction you make between protesting against particular case of oppression and injustice caused to a person X of distant country by another person Y of a distant country and protesting against oppression or injustice meted out to you or your son.
S: It is difficult for you, but simple for me. I am against people living beyond their means. In fact, that is a kind of social norm that is known to every one. But some people do not follow this principle. I have no obligation or duty to protest against each or one or two person trying to leave beyond means. But I might object if my son tries to leave beyond his means because I get more pain when I see my son getting into am imprudent behaviour. I do not have to teach anyone in this age that no one should oppress others or cause injustice to others. I expect everyone to be fair, just and non-oppressive. I do not logically need to object when a person deviate from my expectation. But I will object if my son tries to oppress my daughter or my daughter in-law.
G: Can you give some more analogies?
S: Most human beings on this earth have been taught to behave like human beings. I also do not like human beings to act like animals. But each human being has the right to act like a monkey or a dog. If some human beings do exercise that right, I do not have a logical reason to register my protest whenever a person exercise that right. But I might object when my son or a close friend acts like a monkey or a dog not because of any scientific, logical reason but simply because I am pained to see my friend or son just behaving like an animal.
G: You seem to believe in the saying that ‘Charity begins at home’.
S: In my words here it means ‘just and fair behaviour begins at home and in my own country’. Even if I think that America is oppressive or unjust or Saddam is oppressive or unjust, I feel sad but am not inclined to start a campaign against or for America or Saddam. I would still be inclined to stop my son becomes an oppressor or an unjust person.
G: Any other example?
S: Yes. I am against killing people. But as a soldier in the war front my task is to protect my life and my country not by running away but killing enemy. If my country’s soldier keels the enemy soldier or the enemy soldier kills my country’s soldier, I have no reasons to protest, though I am against any one killing any other and against wars taking place. Similarly, when a criminal kills a kidnapped child for not getting the ransom in time or to flee because the cops being after him, I do not need to protest against murder. I am only sad. If the child is from my family, I may react violently to express my grief or even kill the criminal if I happen to catch him. That’s an emotional outburst and not a rationale scientific behaviour. I do not organize protest against killing of a person by another person as they occur because that has no rational basis. If I do that I am acting emotionally or exploiting the emotions of others for my personal benefit.
G: The weird examples you give are in the nature of cause-effect inverse to help distinguish between cause-effect paradigm based behaviour and cause-effect obseesion syndrome behaviour.
S: You are right. We know that some human beings will have natural tendency to oppress others, be unfair and cause injustice to others. We know that some human beings will protest against such oppression, unfair treatment and injustice. But protesting against some cases of alleged instances does not necessarily follow from any cause-effect paradigm. Equally important the concept of fairness and injustice or oppression varies from society to society and from circumstance to circumstance. In terrorist organizations, if a terrorist wants to leave his organization after some time, he will be provided such treatment as such organizations consider fair and just which is different from and irrelevant to when a member leaves a sports or cultural club.
G: So, you cannot agree to be part of any particular organized protests against alleged case of oppression or injustice as conceptualized by an organizer of protest, especially if you suspect that the organizer has some other ulterior motive to do so.
S: Exactly. All that happen are all natural phenomena. Those who organize protest or protest are as much a natural force as those like me who may not feel the need to protest or be part of an organized protest. There is nothing to choose between these two different kinds of forces. There is nothing so specially great or scientific or rational or human about organizing or raising protest. What is relevant to one type of human beings is irrelevant to others and vice versa.
G: So, I have enough of your weird examples and your weird funny logic.
S: It may be enough for you. But I am not fussy about that. I know that each one of us do only that what God wants each to do at any moment of time.
G: Can we move on to another example of Irrelevance of Relevance?
S: Oh, sure. But let us wait for the next session.
S: It is difficult for you, but simple for me. I am against people living beyond their means. In fact, that is a kind of social norm that is known to every one. But some people do not follow this principle. I have no obligation or duty to protest against each or one or two person trying to leave beyond means. But I might object if my son tries to leave beyond his means because I get more pain when I see my son getting into am imprudent behaviour. I do not have to teach anyone in this age that no one should oppress others or cause injustice to others. I expect everyone to be fair, just and non-oppressive. I do not logically need to object when a person deviate from my expectation. But I will object if my son tries to oppress my daughter or my daughter in-law.
G: Can you give some more analogies?
S: Most human beings on this earth have been taught to behave like human beings. I also do not like human beings to act like animals. But each human being has the right to act like a monkey or a dog. If some human beings do exercise that right, I do not have a logical reason to register my protest whenever a person exercise that right. But I might object when my son or a close friend acts like a monkey or a dog not because of any scientific, logical reason but simply because I am pained to see my friend or son just behaving like an animal.
G: You seem to believe in the saying that ‘Charity begins at home’.
S: In my words here it means ‘just and fair behaviour begins at home and in my own country’. Even if I think that America is oppressive or unjust or Saddam is oppressive or unjust, I feel sad but am not inclined to start a campaign against or for America or Saddam. I would still be inclined to stop my son becomes an oppressor or an unjust person.
G: Any other example?
S: Yes. I am against killing people. But as a soldier in the war front my task is to protect my life and my country not by running away but killing enemy. If my country’s soldier keels the enemy soldier or the enemy soldier kills my country’s soldier, I have no reasons to protest, though I am against any one killing any other and against wars taking place. Similarly, when a criminal kills a kidnapped child for not getting the ransom in time or to flee because the cops being after him, I do not need to protest against murder. I am only sad. If the child is from my family, I may react violently to express my grief or even kill the criminal if I happen to catch him. That’s an emotional outburst and not a rationale scientific behaviour. I do not organize protest against killing of a person by another person as they occur because that has no rational basis. If I do that I am acting emotionally or exploiting the emotions of others for my personal benefit.
G: The weird examples you give are in the nature of cause-effect inverse to help distinguish between cause-effect paradigm based behaviour and cause-effect obseesion syndrome behaviour.
S: You are right. We know that some human beings will have natural tendency to oppress others, be unfair and cause injustice to others. We know that some human beings will protest against such oppression, unfair treatment and injustice. But protesting against some cases of alleged instances does not necessarily follow from any cause-effect paradigm. Equally important the concept of fairness and injustice or oppression varies from society to society and from circumstance to circumstance. In terrorist organizations, if a terrorist wants to leave his organization after some time, he will be provided such treatment as such organizations consider fair and just which is different from and irrelevant to when a member leaves a sports or cultural club.
G: So, you cannot agree to be part of any particular organized protests against alleged case of oppression or injustice as conceptualized by an organizer of protest, especially if you suspect that the organizer has some other ulterior motive to do so.
S: Exactly. All that happen are all natural phenomena. Those who organize protest or protest are as much a natural force as those like me who may not feel the need to protest or be part of an organized protest. There is nothing to choose between these two different kinds of forces. There is nothing so specially great or scientific or rational or human about organizing or raising protest. What is relevant to one type of human beings is irrelevant to others and vice versa.
G: So, I have enough of your weird examples and your weird funny logic.
S: It may be enough for you. But I am not fussy about that. I know that each one of us do only that what God wants each to do at any moment of time.
G: Can we move on to another example of Irrelevance of Relevance?
S: Oh, sure. But let us wait for the next session.
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