Sunday, February 25, 2007


Friday night I saw David Auburn's Proof in the Arts Theatre in Leicester Square. It dealt with the questions I asked myself in Warm Heart, Cold Heart, Post-Emotionalism and the Third Way and Addicted to be Linked. A young girl (Cathy) drops out of school to take care of her mentally unstable father, who used to be a genius mathematician. Upon her father's death, she confronts her sister about the choices they made, and her father's student (Hal) about the magical proof that is found in her father's desk.

When Cathy accuses her sister of living her own life while she was taking care of their dad, her sister reminds her of the tacit division of labour between them: While Cathy stayed with their dad in Chicago, she worked in NY and paid the bills. She also points out that it might have been better for their father if he was institutionalized. Again, division of labour: There are institutions who are specialized in taking care of the mentally instable, so their families can continue living their lives.

As rational as this sounds, it is pretty cold and harsh. It is really nobody's responsibility that their father fell ill. It is just plain bad luck. Who, then, should take care of him? Any one of us could fall so ill that we can no longer take care of ourselves. Behind a Rawlsian veil, it gets harder to decide on general principles. But then, one could also claim that if someone sacrifices too much to take care of a loved one, their unhappiness would leave them useless, even harmful. Someone should either fast without complaint, or not fast at all. But apparently her father appreciates and asks for Cathy's support.

Then Cathy gives Hal, who convinces her that he cares deeply about her, a key to her father's locked drawer. In the drawer is a notebook that has a revolutionary mathematical proof in it. Cathy claims to have written it as she was spending most of her time in the house, taking care of her father. Hal, dedicated to mathematics but far from a creative mind himself, refuses to believe her.

Hal genuinely cares about Cathy, and he means well, but her newly-found genious catches him by surprise. It tips the balance of their relationship in his head, as he pictured himself as the stronger one, the care-taker. He finds it impossible (and if not, unfair) that this young girl comes up with something that he couldn't after years of hard work.

I thought the play made good points on human nature, on selfishness, sacrifice, envy. I hope I will be able to write stuff like this one day! (If I'm patient enough to sit down and actually create something meaningful!)

Monday, February 19, 2007

Inequality, Injustice, Illegitimacy and Insecurity

I went to two very inspiring lectures over the past week. The first one was Joseph Nye's lecture at King's College on Feb. 14, titled "The Future of American Power." Nye is a Professor of International Relations at Harvard University's Kennedy School of Government, and he's credited for having pioneered the "soft power" theory.

The second one was Dr. Mohamed ElBaradei's lecture on Feb. 19 at the LSE, titled "Global Security: Challenges and Opportunities." ElBaradei is Director General of the International Atomic Energy Agency (IAEA.)

ElBaradei spoke of how inequality is the source of insecurity in the world. He spoke of people who live without electricity, who use biomass to cook food, who go to bed hungry, who die because of their poverty. He compared the American spending on defense with the spending on development aid. This comparison shows that Americans choose to address solely the symptoms of the problem, not the roots.

Then he spoke of the unequal value we put on human life. People in Congo, people in Rwanda, people in Darfur die, because they are not important enough [for us] to be kept alive, he said. "How can we expect them to grieve us when we don't grieve them?" he asked.

This reminded me of a lecture I covered on March 23, 2004 by Pulitzer Winner journalist Samantha Power. You can access it here. Here is an excerpt from the article:

"Power started her lecture by quoting a speech President Bush made on Nov. 6, 2003 in Washington, D.C. “Sixty years of western nations excusing and accommodating the lack of freedom in the Middle East did nothing to make us safe, because in the long run, stability cannot be purchased at the expense of liberty.’”

Power said “the enemy of my enemy can be my friend” attitude in foreign policy must change. She gave the example of U.S. backing of Iraq when “Iran was the enemy in the neighborhood.”

She said at the time Saddam Hussein was violating the rights of the Kurdish minority in Iraq, but the United States overlooked these violations.

“Lines not to cross were moved to keep Iran down,” she said.

When Iraq started threatening not only Iran, but also Kuwait and Israel with its weapons development program, it became clear that the United States could no longer support Hussein, according to Power.

Power outlined many obstacles to integrating concern for human rights into U.S. foreign policy.

The first one, she said, is that “victims of human rights abuses don’t vote in the U.S.” She said even she, “the genocide chick,” did not vote on the 1996 elections on the basis of how the Clinton administration “allowed” genocide in Rwanda and Bosnia.

According to Power, the second obstacle is a structural one. She said unlike domestic politics, foreign policy does not have “checks and balances” to make sure “urgent will not trump the important, and short term will not trump the long term.”

Power said the third obstacle is people’s lack of “moral imagination.” She said even though people know real-time facts, like the number of Rwandans who died in the genocide, they have no real knowledge of the “human stakes,” they do not stop to imagine the struggle of every person.

The main default of foreign policy is that short-term security and economic interests always get in the way of the concern for human rights and that while ethnic lobbies like Albanians and Armenians play a constructive role for policy change, their efforts focus on a particular group and lack universality.

Power called U.S. foreign policy “gratuitous unilateralism,” recalling the resistance of the United States to the International Criminal Court. She said the United States tried to convince its allies not to turn in U.S. soldiers to the international court and cut or suspended military aid to countries that refused."

This brings me to the Nye lecture. Nye went back to the days when the Soviet troops left Afghanistan and the country "collapsed on itself," but the Americans did not mind because it was "half way around the world." Their indifference lasted until Sep. 11, 2001.

Nye used the metaphor of a "three-dimensional chess board" to explain current world politics. The first dimension is military power, one aspect of "hard power," and noone can challenge the US on that. He said that the world is already multi-polar when it comes to economic power, another aspect of "hard power." The third dimension, however, covers the transnational threats such as terrorism, poverty and global warming, and the US should use the "legitimacy of its actions" to influence other actors' actions, i.e. "soft power."

So far, the US has not been very successful in doing that. Nye pointed out that the number of recruits of the extremist groups in the Middle East exceeds the number killed or captured by the American troops. Even if the Americans dismantle one group of extremists, another will spring up as long as the perceived inequality, injustice and illegitimacy is not addressed.

Injustice: ElBeredei said he has difficulty asking countries to conform with the Non-Proliferation Treaty, when the nuclear powers do not fulfill their obligations to disarm.

Now we should each turn to ourselves and ask, "why don't I care?" Why are we indifferent to the poverty, violence and suffering that happen far from us? (The distance is both in terms of time and space. We don't care about those who suffered in the past, and we don't care about those who are suffering far away, now... This means we won't do anything to make sure that people won't suffer in the future.) Why do we lack that "moral imagination" Samantha Power describes? I wrote many posts ("Post-Emotionalism and the Third Way," "Luck and Responsibility," even "Indifference") under the label "Post-emotionalism" exploring this phenomenon. We put too much value on individual responsibility, we try our best not to intentionally hurt people in our vicinity, but as long as we are not directly responsible for their suffering, we simply do not care. Our perceived lack of responsibility in their suffering frees us from guilt and the obligation to do something about it.

We are indifferent as long as they don't touch us. We live in bliss. But people who suffer far away can come closer and touch us. Inequality, injustice brings insecurity, terror. That's the feeling I described in "Turkey's Paradox." I don't feel free in Turkey, because I don't feel safe to be free. And the feeling of fear, insecurity stems from inequality. The fear won't leave us until we become aware of the sources of the problem and do something about it. Or else, our survival will be a matter of chance.

Sunday, February 18, 2007

Comments on Turkish Economy

in response to Pratik's posts on Turkey:
India, Turkey and Arrow's Impossibility Theorem
Turkey's Silver Lining - An Outsider's Account of the 2001 Financial Crisis

Hey Pratik!
Thanks for your interest in my country :) It seems to me that you got the facts right, but the dots need a little more connecting. I will paint a slightly gloomier picture of the Turkish political economy today (and hence Dervis' influence.) Feel free to correct my economics wherever I go wrong!

Among all the emerging markets, Turkey still remains one of the most susceptible to global and domestic shocks, because it still finances its large current account deficit with short-term capital inflows. First a little history to explain the roots of the problem.

In the 1980's, Turgut Özal liberalized the Turkish economy by replacing import substitution with export promotion, opening the capital account and encouraging foreign investment in the country. The problem was that the social safety nets for losers from the reform were not in place on time. Instead, to avoid losing their votes, weak coalition governments kept making discretionary payments to losers, while subsidizing the exporters heavily, and this in turn led to high public debt and high interest rates. Banks preferred lending to the government instead of the private sector, and this reduced the competitiveness of the economy as a whole.

In the run-up to the crisis in 2000-2001, the Lira was overvalued: Its rate of depreciation was not able to match the inflation rate. This led to a large current account deficit financed by short-term capital inflows. There was a currency-board that pegged lira to the dollar. The sterilization of the inflows resulted in a bigger monetary base and lower real interest rates, and the banks which held treasury bills became extremely vulnerable. Sensing a crisis was looming, investors took out a large chunk of their short-term investments in 2000, but IMF came to the rescue. After the argument between the President and the PM in 2001, however, a second flight rendered the floating of the Lira and a large devaluation unavoidable.

Now the Turkish lira is again perceived to be overvalued, and the large current account deficit is again financed by hot money. The difference from 2001 is that the banking system is more robust (thanks to Kemal Dervis who established the independence of the Banking Regulatory Authority) and the Lira is floating. However, this does not mean that the economy is not vulnerable. The most recent fluctuation, which also hit Hungary, came last May, and the Central Bank had to raise the interest rates considerably to prevent a capital flight.

The deep-rooted political tensions between the nationalist-secularist establishment and the more liberal-minded (including EU proponents) are likely to stay (For more on this see The current government was not able to act decisively, but there is no real alternative. The social security system continues to run large deficits, and a recent reform proposal was reversed by the Constitutional Court. 2007 is feared to be a "lost year:" General elections will follow the controversial presidential elections. A crisis would especially hurt those who borrowed in foreign currency.

Meanwhile, another important criticism is that while FDI has increased, rather than starting businesses and creating new employment, foreigners prefer to acquire existing Turkish firms and banks.

I wanted to play the devil's advocate and paint a gloomy picture, but I know first-hand that all this does not prevent local entrepreneurs from making investments and creating employment. I hope the efforts of the private sector will improve our competitiveness despite the decades of bad public administration.

Thanks for the Sunday morning brain stimulation, but now gotta head over to the Chinese New Year parade!

Wednesday, February 14, 2007

A radio interview with Turkish writer Elif Şafak about memory, faith, femininity and language... I admired the clarity and richness of her thoughts.

Once I read somewhere (now it's a cliché) that the worst is not dislike, but it's indifference. Because a person who dislikes you still cares. If they make you upset, you can still annoy them. But you can't touch a person who does not care, who is not aware. They are out of the reach of your influence. Their unresponsiveness is not because they want to seem detached (if this was the case, it would be a sign of caring) but that you are not a matter of importance to them. They overlook you.

They don't do it on purpose, so you can't really accuse them of being a bad person (if that would change anything!) They just don't care about you, and that's not a crime. Your hands are tied in front of them.

The best thing you can do is to remain indifferent for as long as possible. Unfortunately, the moment you try to stay indifferent, you have already entered the territory of conscious action, from which there is no return. Every time you claim you forgot someone, you confirm that you haven't. If you have really forgotten, you would not be thinking about them at all.

You understand the value of indifference once you lose it. It's like health. Cherish every moment of it.

My only consolation is that there are so many people I'm indifferent about, I wouldn't even be able to point them out to you (if that helps!)

Friday, February 09, 2007

It’s that little flame
That lights a fire
Under your ass.
It keeps you going strong
Like a car with a full
Tank of gas.
Everyone else has a purpose,
So what’s mine?

Oh look.
Here’s a penny.
It’s from the year I was born.
It’s a sign!

Ba ba ba ba doo doo doo doo doo.
I don’t know how I know,
But I’m gonna find my purpose.
I don’t know where I’m gonna look,
But I’m gonna find my purpose.
Gotta find out.
Don’t wanna wait.
Got to make sure that my life will be great.
Gotta find my purpose.
Before it’s too late.

Ensemble: He’s gonna find his purpose.
Princeton:Whoa ooh oh.
Princeton and Ensemble:I’m [He’s] gonna find my [his] purpose.
Ensemble: He’s gonna find his purpose.
Princeton:Yeaaah yeah yea.
Princeton and Ensemble:I’m [He’s] gonna find my [his] purpose.

Could be far.
Could be near.
Could take a week
A month
A year
At a job.
Or smoking grass.
Maybe at a pottery class.
Could it be?
Yes it could.
Something’s coming.
Something good.
I’m gonna find my purpose.
Ensemble: You’re gonna find your purpose.
Whoa ooh oh.
I’m gonna find it!
What will it be?
Where will it be?
My purpose in life is a mystery.
Gotta find my purpose.
Gotta find me.

Ensemble:You’re gonna find your purpose.
Princeton:Whoa ooh oh.I’m gonna find my purpose.
Ensemble:Your’re gonna find your purpose.
Princeton:Pur- pur- purpose Yeah yeah.
I gotta find me!

More Avenue Q lyrics:

Sunday, February 04, 2007

A Small Note on Higher Education Fees

Today at Warwick Economics Summit there was a debate on higher education fees, and one of the participants asked whether the fees should be determined based on the costs of each student or the expected salary of the graduate (as the private benefit from the degree is the expected increase in the salary.) Actually, the fees are determined by both! The cost is reflected by the supply curve, and the expected salary (utility) makes up the demand curve.

P.S. Pratik's analysis on the need for raising the cap on variable fees, and the political economy of higher education reform (i.e. the need to explain the reform to students and parents to make sure that the proposal is politically feasible, and even more importantly, that people can utilize the system to its utmost potential once it is implemented.)
Being Good

"People who can't be witty exert themselves to be devout and affectionate." George Eliot

Today I made a comment and one of my friends said, "she's being all nice and sweet again..." I pondered out loud in response, "I wonder if I'm really good or if I'm making myself [sound]good." Then my other friend said, "you're conscious of your bad side, so you're trying to make sure your good side prevails... you're a conscious person."

When I was in middle school I wrote something about being an orange versus being a lemon. Being an orange is all nice and sweet, but I'd really like to see myself as a lemon, because a lemon is much more interesting!