At a time when the big businesses, both local and global, are hit by their own big-headed expansion plans, the government should not sacrifice ordinary men and women for these ones by asking them to go into debt and spend. Instead, the government should find ways to help the little men and women to whether through these hard times while the big ones collapses.
At the very centre of the operation to save the national economy is the Federal Budget. I believe the Federal Budget should be looked at differently in order for us to be able to get ourselves out of this quandry.
Structure of the Federal Budget
The Federal Budget is structured in such a way that Federal Revenue is used first to fund Federal Operating Expenditure, with leftover to fund Federal Development Expenditure. If the Development Fund is insufficient, it is deemed alright to fund Federal Development Expenditure by issuing debt because development expenditure should be on development projects which are expected to earn a return in the future and earn the government future revenue.
Human Capital as Infrastructure
We are caught up by the idea that infrastructure is all brick and mortar - roads and school buildings - that we tend to favour the construction sector at the expense of all the other sectors, which are many.
1. Maintenance. Maintenance is regarded as an operating expense. This means that once an allocation is made in the Development Budget to build an infrastructure, the matter is usually left at that, with no attendant allocations made for the necessary and essential maintenance expenses. In economics, maintenance is considered as replacement investment, to mend the wear and tear. I suggest that the cost of all Development Projects should include replacement investment for maintenance.
2. Human Capital. When the Budget allocates funds for education projects, allocation should also be made for new teachers, trainers and lecturers. Human capital does not reside in buildings but in people and we must take care of the human repository of our national human and intellectual capital. The bodies and training and output of the education sector should be considered as capital expenditure, not operating.
3. Law and Order and Security. Law and order and security of the nation is important for its peace and harmony. There may be a preponderance of the Budget on the hardware, but equal emphasis should be made on the personnel. By not having enough bodies and sufficiently trained policemen and soldiers, we open our society to fear from internal and external sources. We should have proper guard of our coastline as well.
4. Cultural Capital. With the corporate world is suffering from the aftermath of a wild party, and as the economy rests, we now have the time and space to rebuild our cultural capital which we have unfortunately left unattended for too long. The Federal Budget should allocate funds to all the Local Authorities throughout the nation for them to organise culture-related economic activities which are likely to be centred on the arts. Let a thousand cultures bloom.
5. Hawking and Small Businesses. By far one of the most effective ways for individuals to counter the effects of the global economic slowdown is for them to have the opportunity to use a little capital but a lot of ingenuity and hard work and sweat to peddle things which they are in a position to produce. I therefore suggest that the Local Authorities should go all out to help individuals to set up stalls by preparing neat spaces for them to trade.
6. Lessening the Burden of the Ordinary People. The Federal Budget should allocate sufficient funds to the Local Authorities so that these LAs are not tempted to raise fees and charges during a recession just because they themselves are having a hard time with their finances. By passing their financial problems down to the general public, the authorities which are part of the government are acting as bullies instead of civil servants to the people. The ridiculously exorbitant fines imposed on small traffic offences, for example, is a disgrace to the government.
What is Operating, What is Development
As Keynes would argue, by the time you have sorted out your conceptual problem, society would have suffered untold miseries by the loss of jobs and incomes. It is far more important to act according to one's common sense and compassion to alleviate suffering rather than to be intellectually correct. There is a mental block in the way we are responding to the current global crisis and my suggestions are to show how some of the inadequacies may be overcome.
Saturday, February 21, 2009
Friday, February 20, 2009
The Middle Class - The Great Leveller
The Middle Class is the great leveller of income and wealth. (See "Burgeoning Bourgeoisie" Special Report by The Economist Friday 20th February 2009 here. )
The Middle Class is created through trade and commerce, fully educated about the world and is of the world. By the sweat of its brows, the Middle Class pushes forward from nothing but the shirt on his back to save and acquire basic assets such as a house and a car and education for his children. In this way, the assets of one generation is passed on to the next, through careful handling of money and finance, prudence and frugality, honesty and hard work.
The Middle Class is where the Coolie Class aspires to. The Coolie Class is disadvantaged by the lack of choice of occupation and is restricted to specific dead-end employment. The Coolie Class can only make ends meet, and sickness is a potential ticket to poverty. Without a house or a car, the Coolie Class can still strive to save and gather all the pennies and send their children to school and beat them until they pass all their exams.
The privileged by way of history evolved to become the Political Class which is an economic class by itself for it has the potential to amass fortunes through the abuse of political power (as a rat which falls into the rice bag). Politics is not seen as a duty to govern for the sake of the nation but to take advantage of for economic gains. Such members of the Political Class have no qualms about wrecking the whole social and economic structure just so as to hold on to power for as long as society allows them to do so.
Some members of the Middle Class may try to join the Political Class with the purpose keeping politicians honest. By their very motivation, they are not part of the Elite. The Middle Class in politics brings with them the Middle Class ethics of hard work, honesty, and be of service to all and sundry, only to be floored by mercenaries of the Elite. (But some of the members of the Middle Class could be traitors - especially those who have been professionally trained to disregard the pain they inflict on others in the belief that they are doing good.)
But my point is that it is the Middle Class thinking that is the reason for many of us calmouring for education to be key investment that the government must make for the society and the country during such a trying time. With education, young people can contribute to building the society that they have inherited (although some may wish to disinherit themselves by trying to destroy it). With education, the unemployed can only travel the world in search of a proper occupation. This is for those of the Middle Class who have been taught to depend on themselves, to fend for themselves, to pull themselves up by their own bootstraps. With education, those who have been transported on a conveyor belt on a magic mystery tour will find themselves dumped when the conveyor stops; the consolation is that at least they have been endowed with the elements of a basis for finding where their bootstraps are.
It is not strange that the Middle Class is versatile and mobile. Because they have sweated for the little assets they own, they are always on the lookout for a safe place to deposit their little fortunes. This is where the political climate comes in. There is where the social infrastructure comes in. This is where the Political Class plays a crucial part in determining the investment climate of the country. If the Political Class cannot see beyond their fat tummies, then the economy will face a hallowing of the Middle Class and be left with the Coolie Class to deal with. (Do not therefore be dismayed if the Political Class try to romance the Coolie Class by harping on the good old days when the sultans ruled absolutely over the masses.)
We should all be Middle Class and be the same as everybody else.
The Middle Class is created through trade and commerce, fully educated about the world and is of the world. By the sweat of its brows, the Middle Class pushes forward from nothing but the shirt on his back to save and acquire basic assets such as a house and a car and education for his children. In this way, the assets of one generation is passed on to the next, through careful handling of money and finance, prudence and frugality, honesty and hard work.
The Middle Class is where the Coolie Class aspires to. The Coolie Class is disadvantaged by the lack of choice of occupation and is restricted to specific dead-end employment. The Coolie Class can only make ends meet, and sickness is a potential ticket to poverty. Without a house or a car, the Coolie Class can still strive to save and gather all the pennies and send their children to school and beat them until they pass all their exams.
The privileged by way of history evolved to become the Political Class which is an economic class by itself for it has the potential to amass fortunes through the abuse of political power (as a rat which falls into the rice bag). Politics is not seen as a duty to govern for the sake of the nation but to take advantage of for economic gains. Such members of the Political Class have no qualms about wrecking the whole social and economic structure just so as to hold on to power for as long as society allows them to do so.
Some members of the Middle Class may try to join the Political Class with the purpose keeping politicians honest. By their very motivation, they are not part of the Elite. The Middle Class in politics brings with them the Middle Class ethics of hard work, honesty, and be of service to all and sundry, only to be floored by mercenaries of the Elite. (But some of the members of the Middle Class could be traitors - especially those who have been professionally trained to disregard the pain they inflict on others in the belief that they are doing good.)
But my point is that it is the Middle Class thinking that is the reason for many of us calmouring for education to be key investment that the government must make for the society and the country during such a trying time. With education, young people can contribute to building the society that they have inherited (although some may wish to disinherit themselves by trying to destroy it). With education, the unemployed can only travel the world in search of a proper occupation. This is for those of the Middle Class who have been taught to depend on themselves, to fend for themselves, to pull themselves up by their own bootstraps. With education, those who have been transported on a conveyor belt on a magic mystery tour will find themselves dumped when the conveyor stops; the consolation is that at least they have been endowed with the elements of a basis for finding where their bootstraps are.
It is not strange that the Middle Class is versatile and mobile. Because they have sweated for the little assets they own, they are always on the lookout for a safe place to deposit their little fortunes. This is where the political climate comes in. There is where the social infrastructure comes in. This is where the Political Class plays a crucial part in determining the investment climate of the country. If the Political Class cannot see beyond their fat tummies, then the economy will face a hallowing of the Middle Class and be left with the Coolie Class to deal with. (Do not therefore be dismayed if the Political Class try to romance the Coolie Class by harping on the good old days when the sultans ruled absolutely over the masses.)
We should all be Middle Class and be the same as everybody else.
Consumption & Service Tax
There is an anomaly in the thinking on taxation in relation to the economic activities of production and consumption.
It used to be fashionable to think that production is the better thing to happen in the economy and therefore the income tax was seen to be undesirable because it supposedly discourages production. Hence, the service tax was invented with the objective of discouraging consumption so that more resources would be released for production, by the government from the service tax collected and the public by the amount of consumption discouraged.
Now, it is fashionable to think that consumption is the better thing to do for the melting economy because there is fallout in demand.
If the policy objective is to increase consumption, then the service tax should be reduced or abolished.
It used to be fashionable to think that production is the better thing to happen in the economy and therefore the income tax was seen to be undesirable because it supposedly discourages production. Hence, the service tax was invented with the objective of discouraging consumption so that more resources would be released for production, by the government from the service tax collected and the public by the amount of consumption discouraged.
Now, it is fashionable to think that consumption is the better thing to do for the melting economy because there is fallout in demand.
If the policy objective is to increase consumption, then the service tax should be reduced or abolished.
Thursday, February 19, 2009
Maintaining Confidence
How does one maintain confidence in the face of disaster?
If there is a tsunami, or a massive outback bush fire, or a financial meltdown or an incapacitation of the economy or a massive heart attack, the correct posture should not be one of as if it is not a serious matter.
The correct posture should be to find out exactly what is wrong - to get as much data and information as possible, analyse them and then try to come up with a logical conclusion and a course of action.
Not only should more data and information be analysed out for the authorities, but those data and information should be made public so that public has an idea of the situation and respond accordingly in their own way.
I wonder whether what happened to Pompeii was because of the policy on managing confidence so that the public did not panic and lived as if today would be like yesterday.
If there is a tsunami, or a massive outback bush fire, or a financial meltdown or an incapacitation of the economy or a massive heart attack, the correct posture should not be one of as if it is not a serious matter.
The correct posture should be to find out exactly what is wrong - to get as much data and information as possible, analyse them and then try to come up with a logical conclusion and a course of action.
Not only should more data and information be analysed out for the authorities, but those data and information should be made public so that public has an idea of the situation and respond accordingly in their own way.
I wonder whether what happened to Pompeii was because of the policy on managing confidence so that the public did not panic and lived as if today would be like yesterday.
Monday, February 16, 2009
Confidence & Optimism: Policy
There is a difference between confidence and optimism. Confidence is usually quiet, but your enemies will call you arrogant. Optimism is confidence with enthusiasm, with a tendence to act because the future is expected to be better than today.
For an individual, confidence comes from inner strength - moral values, spiritual enlightenment. Individual optimism comes from the feeling of one's ability to perform well in the coming environment.
For the nation, confidence and optimism is the result of policy. The people feel confident when they know they have a right to belong in the country regardless of the circumstances. The people feel optimistic when they can what they like in the country, within the bounds of the usual individual limitations traded off in any civilised society.
Confidence and optimism becomes an issue in a country when the citizens are differentiated. Like any differentiated product in a market economy, there is a competition for a higher value, based on certain characteristics which the promoters may wish to highlight. When intrinsically homogeneous products, like washing power, are differentiated, the only method of differentiation is branding. This is where promotion and advertising. The differentiation are purely in the minds of those who would benefit from the branding, and they are the politicians. The ordinary men and women which, in this example, are the homogoneous washing power, can only feel bewildered by the sharp differentiation they may been made to realise among themselves that they may even begin to believe in that differentiation in due course. This is treading on dangerous ground.
Sensible governments, as we have seen in the civilised world, have placed great emphasis on the commonness of people. It is this commonness of people that gives rise to the commonwealth of man, a concept I am dismayed that even our more eminent political leaders may have failed to understand. It is the working together of the common people among ourselves that we all share a common future, and depending on what we do and how we do them, a better common future.
One of the greatest failures of the Malaysian economy - and society - is the segregation of the various business communities such that each has short-changed themselves by their failure to open up and trade with each other. This works against the law of economics, and the consequences can only be a degradation in efficiency and competitiveness against the rest of the world.
Strangely, thought not unexpectedly, within such a divided economy, it seems acceptable to bring barbarians within our midst while we refuse to co-operate to work among ourselves. We make a big deal out of the promotion of foreign direct investments, while we are happy to strangle our own home-grown investors through all kinds of economic restrictions.
The result of this misguided policy on investment - the preference of foreign to local - has brought our economy to a hugely mis-structured economy where our graduates are deemed useless. FDIs want to hire cheap and half-thinking individuals so that wages can be kept low. The elite pump primed themselves with construction projects wish hires only illiterate or semi-illiterate. There is no adequate home-grown investment which can only grow through productivity gains and innovation. We are not stuck as a middle-income economy for no reason.
While the deterioration of our education system is a phenomenon to lament - which only the agents of the deterioration can only sing their own phrases - it is not an entirely hopeless situation. Our people, as a result of our diversity, are well-educated in the world outside; where the formal education system may be a near-failure, the world outside the local universities is the school of hard knocks. Some of our chosen geniuses have been knocked down really hard.
The only thing that we all need to learn, including our children, is to have an openness of the mind, so that we can see things as they are for ourselves, rather than believing in what other people may tell us. Learning to think is the only education we need, regardless of the fields of study we or our children may choose to undertake. The ability to think and to acquire knowledge of reality is the very basis for innovation of a better world for all of us.
What is the best form of investment in the current economic crisis? When there are not enough jobs, invest in the education of the people - the first-time job seekers, the retrenched and those how currently clinging onto their jobs. The economy has collapsed because it has gone off-tangent. How to redirect the economy? I won't leave it to the politicians; the politicans should leave it to the people - by providing the preconditions for investment, our own investment.
For an individual, confidence comes from inner strength - moral values, spiritual enlightenment. Individual optimism comes from the feeling of one's ability to perform well in the coming environment.
For the nation, confidence and optimism is the result of policy. The people feel confident when they know they have a right to belong in the country regardless of the circumstances. The people feel optimistic when they can what they like in the country, within the bounds of the usual individual limitations traded off in any civilised society.
Confidence and optimism becomes an issue in a country when the citizens are differentiated. Like any differentiated product in a market economy, there is a competition for a higher value, based on certain characteristics which the promoters may wish to highlight. When intrinsically homogeneous products, like washing power, are differentiated, the only method of differentiation is branding. This is where promotion and advertising. The differentiation are purely in the minds of those who would benefit from the branding, and they are the politicians. The ordinary men and women which, in this example, are the homogoneous washing power, can only feel bewildered by the sharp differentiation they may been made to realise among themselves that they may even begin to believe in that differentiation in due course. This is treading on dangerous ground.
Sensible governments, as we have seen in the civilised world, have placed great emphasis on the commonness of people. It is this commonness of people that gives rise to the commonwealth of man, a concept I am dismayed that even our more eminent political leaders may have failed to understand. It is the working together of the common people among ourselves that we all share a common future, and depending on what we do and how we do them, a better common future.
One of the greatest failures of the Malaysian economy - and society - is the segregation of the various business communities such that each has short-changed themselves by their failure to open up and trade with each other. This works against the law of economics, and the consequences can only be a degradation in efficiency and competitiveness against the rest of the world.
Strangely, thought not unexpectedly, within such a divided economy, it seems acceptable to bring barbarians within our midst while we refuse to co-operate to work among ourselves. We make a big deal out of the promotion of foreign direct investments, while we are happy to strangle our own home-grown investors through all kinds of economic restrictions.
The result of this misguided policy on investment - the preference of foreign to local - has brought our economy to a hugely mis-structured economy where our graduates are deemed useless. FDIs want to hire cheap and half-thinking individuals so that wages can be kept low. The elite pump primed themselves with construction projects wish hires only illiterate or semi-illiterate. There is no adequate home-grown investment which can only grow through productivity gains and innovation. We are not stuck as a middle-income economy for no reason.
While the deterioration of our education system is a phenomenon to lament - which only the agents of the deterioration can only sing their own phrases - it is not an entirely hopeless situation. Our people, as a result of our diversity, are well-educated in the world outside; where the formal education system may be a near-failure, the world outside the local universities is the school of hard knocks. Some of our chosen geniuses have been knocked down really hard.
The only thing that we all need to learn, including our children, is to have an openness of the mind, so that we can see things as they are for ourselves, rather than believing in what other people may tell us. Learning to think is the only education we need, regardless of the fields of study we or our children may choose to undertake. The ability to think and to acquire knowledge of reality is the very basis for innovation of a better world for all of us.
What is the best form of investment in the current economic crisis? When there are not enough jobs, invest in the education of the people - the first-time job seekers, the retrenched and those how currently clinging onto their jobs. The economy has collapsed because it has gone off-tangent. How to redirect the economy? I won't leave it to the politicians; the politicans should leave it to the people - by providing the preconditions for investment, our own investment.
Thursday, February 12, 2009
Design Fault in the Modern Economy
Trained economists take a long time to understand the real meaning of "aggregate demand" which the man in the street seems to be able grasp within a second. Why? Because there is a design fault in the modern economy which is predicated on constant investment not consumption.
Consumption
When the man in the street hears the word "demand," he thinks like a businessman. Demand means people come and buy things from you.
If people do not come and buy, there is no demand, and this is bad for business. You must go and get people to buy.
If the problem persists, you can threaten to sack your workers (for you to save costs, rather than for you to bring out the profits you have made all the while to hold up the operation).
You can appeal to the government to cut interest rates, cutting taxes, and cutting contributions to retirement funds - so that people will have more money to spend (which is good for your revenue) and your interest payments will be lower (if you have the cash).
You hope that the ordinary consumers will get more into debt (if the banks are willing to lend in a declining economy) so that you can get your business out of debt.
How long do you think this reliance on the increasing indebtedness to the consumers can go on?
If their current spending level cannot save you in the first place, it is unlikely that their future spending will be any better - given that they may lose their jobs, their share investment has fallen in value, their real estate value has declined and there is less social pressure to buy things to keep up with their neighbours.
It is more likely that prudence and the general fear over the uncertain future will keep them from increasing their spending in the coming weeks and months.
The consumption policy to economic recovery is doomed to failure.
Investment
The secret to keeping the modern economy alive is government spending and investment. Why?
There is a design fault in the modern economy. In the old traditional rural economy, people produce things that they need. Whatever amount of rice they have produced, they share amoung themselves and are content.
In a modern economy, we produce things that we ourselves do NOT need. We produce things we think our people will buy, whether they need it or not.
So the share of the output which would have belonged to us as profit in the traditional economy has now become unsold stock. So we need somebody else to buy the stock so that we can translate that into profit in monetary terms.
The need for this monetary translation of stock to become profit is the design fault of the modern economy.
The only demand that can arise to give this monetary translation of the profit-stock is either government spending on projects or new investments by the private sector.
With investment, the economy uses the excess of the output, over and above current consumption needs, to increase its future output. It is this productivity growth in production by the current generation that will produce the means of employment for the next generation.
It is the abstinence of the current generation in its current consumption that provides the basis for the future expansion of the economy. This abstinence is called savings and innovation is required to convert savings into investment.
The decline in current investment is the result of wrongful production of output by the last generation. Such wrongful unproductive output are things like funny financial instruments (which give unprecedented rewards to their inventors) and real estate (especially those that are involved in luxury rather than necessities) and consumption goods.
Why the production of only consumption goods wrong? (a) Because there is no effort made to invest in future production. (b) Because the workers are never paid sufficiently for them to have the income to spend until businesses can make money, unless the workers get into debt. This is the worst policy option.
The second worse policy option is for the government to spend. But this is necessary and that is the basis of expansionary fiscal policy.
The best policy is for investment to be forthcoming. How? Confidence and optimism.
Consumption
When the man in the street hears the word "demand," he thinks like a businessman. Demand means people come and buy things from you.
If people do not come and buy, there is no demand, and this is bad for business. You must go and get people to buy.
If the problem persists, you can threaten to sack your workers (for you to save costs, rather than for you to bring out the profits you have made all the while to hold up the operation).
You can appeal to the government to cut interest rates, cutting taxes, and cutting contributions to retirement funds - so that people will have more money to spend (which is good for your revenue) and your interest payments will be lower (if you have the cash).
You hope that the ordinary consumers will get more into debt (if the banks are willing to lend in a declining economy) so that you can get your business out of debt.
How long do you think this reliance on the increasing indebtedness to the consumers can go on?
If their current spending level cannot save you in the first place, it is unlikely that their future spending will be any better - given that they may lose their jobs, their share investment has fallen in value, their real estate value has declined and there is less social pressure to buy things to keep up with their neighbours.
It is more likely that prudence and the general fear over the uncertain future will keep them from increasing their spending in the coming weeks and months.
The consumption policy to economic recovery is doomed to failure.
Investment
The secret to keeping the modern economy alive is government spending and investment. Why?
There is a design fault in the modern economy. In the old traditional rural economy, people produce things that they need. Whatever amount of rice they have produced, they share amoung themselves and are content.
In a modern economy, we produce things that we ourselves do NOT need. We produce things we think our people will buy, whether they need it or not.
So the share of the output which would have belonged to us as profit in the traditional economy has now become unsold stock. So we need somebody else to buy the stock so that we can translate that into profit in monetary terms.
The need for this monetary translation of stock to become profit is the design fault of the modern economy.
The only demand that can arise to give this monetary translation of the profit-stock is either government spending on projects or new investments by the private sector.
With investment, the economy uses the excess of the output, over and above current consumption needs, to increase its future output. It is this productivity growth in production by the current generation that will produce the means of employment for the next generation.
It is the abstinence of the current generation in its current consumption that provides the basis for the future expansion of the economy. This abstinence is called savings and innovation is required to convert savings into investment.
The decline in current investment is the result of wrongful production of output by the last generation. Such wrongful unproductive output are things like funny financial instruments (which give unprecedented rewards to their inventors) and real estate (especially those that are involved in luxury rather than necessities) and consumption goods.
Why the production of only consumption goods wrong? (a) Because there is no effort made to invest in future production. (b) Because the workers are never paid sufficiently for them to have the income to spend until businesses can make money, unless the workers get into debt. This is the worst policy option.
The second worse policy option is for the government to spend. But this is necessary and that is the basis of expansionary fiscal policy.
The best policy is for investment to be forthcoming. How? Confidence and optimism.
Wednesday, February 11, 2009
Protection: Where To Hide
How does one protect oneself in modern life?
The modern life is often seen to be perilous and most of us feel inclined towards a need for protection.
Insurance used to be most acceptable form of protection from unforeseen financial circumstances. Unforeseen bodily impairment leading to the explusion from the economic mainstream is a fear that people could be tempted to impart regular sums of money on the promise of a token sum on the eventuality. Death is pretty foreseeable although not precisely, so an insurance for death is very much a intertemporal savings arrangement for the middle class. (For the poor, it is more a case of overcoming the fear of having not enough money for proper burial). From this basic ideas, all kinds of fear are promoted by the insurance industry, such as education for the children, illnesses, old age, and I think somebody has come up with the insurance for unemployment (which is a brillant idea, the one all of us really need, if the returns are sufficient).
Education is often seen to be a universal insurer in the belief that a certified 3-4 years spent in an institution of higher learning is sufficient ground for keeping a toe in the doorway when times are hard. For any business needs a talent to take one of out a quagmire. This usually applies to the case of a business with no active owners and a hired hand is expected to bring in the profits, usually with a share to the manager, but at the expense of the workforce who will be often shakened and stirred, and spit out when times are bad. For an owner-operator, the entrepreneur of course sees himself as the master strategist and any hired hand is but an underling to do his bidding.
In the civil service, the ministers are the masters and all bureaucrats are but servants not to the people but to the ministers. For the top civil servants to be able to counter any unreasonable requests of the ministers, they really must be men of integrity (and that integrity must come from their knowledge and their wisdom); failing which, the civil servants are nothing but peons. It is an insurance for both the ministers and the civil servants when they collude to fool the people - but then the truth will always prevail even if belatedly. How do we protect ourselves from bad government? Bad government comes from the lack of wisdom. Strong leadership can lead to bad things, and good leadership without power is a lame duck. I rather a good system in place first and then staff it with the right kind of people.
In everyday life, we all live dangerously. Harm and death await us at every corner. We go about our daily chores like bubbles jumping up and down until we pop and disappear. There is no certainty, and out of this constant fear about the unknown future, we try to manage our immediate environment. In everyday society, this is called politics - the politics of fear, war, and control. Mobilising the power of the mob is the basis of political power. We need a strong leadership that is good, and restrained. A strong leadership that incite the use of violence to control and weld power is the way of the gangster. When gangsterism arises in politics, the countervailing force must be the exercise of the power of law and order by the government. It is the fear of strangers that people choose to congregate in villages and towns and nations. When society does not understand its own people and consider each other strange, we have the ingredients for civil war.
It is modern wisdom that a life is worth the same as all lives. To think of dispensing of someone's life so that one can live is the thinking of a selfish person. To think of dispensing of one's own life so that others may live is usually considered a hero by those who benefited from such actions. Both are incorrect for their extremism.
At the end of the day, the only way to protect oneself from unhappiness is not to fear death but also not to love death. We should use our brains to express ourselves and solve problems which must surely be technical in nature. To charge every issue with emotion is dangerous in an era of mass communication and miscommunication. The only way to protect all of us is through clear thinking and reconciliation, no matter how painful emotionally.
The modern life is often seen to be perilous and most of us feel inclined towards a need for protection.
Insurance used to be most acceptable form of protection from unforeseen financial circumstances. Unforeseen bodily impairment leading to the explusion from the economic mainstream is a fear that people could be tempted to impart regular sums of money on the promise of a token sum on the eventuality. Death is pretty foreseeable although not precisely, so an insurance for death is very much a intertemporal savings arrangement for the middle class. (For the poor, it is more a case of overcoming the fear of having not enough money for proper burial). From this basic ideas, all kinds of fear are promoted by the insurance industry, such as education for the children, illnesses, old age, and I think somebody has come up with the insurance for unemployment (which is a brillant idea, the one all of us really need, if the returns are sufficient).
Education is often seen to be a universal insurer in the belief that a certified 3-4 years spent in an institution of higher learning is sufficient ground for keeping a toe in the doorway when times are hard. For any business needs a talent to take one of out a quagmire. This usually applies to the case of a business with no active owners and a hired hand is expected to bring in the profits, usually with a share to the manager, but at the expense of the workforce who will be often shakened and stirred, and spit out when times are bad. For an owner-operator, the entrepreneur of course sees himself as the master strategist and any hired hand is but an underling to do his bidding.
In the civil service, the ministers are the masters and all bureaucrats are but servants not to the people but to the ministers. For the top civil servants to be able to counter any unreasonable requests of the ministers, they really must be men of integrity (and that integrity must come from their knowledge and their wisdom); failing which, the civil servants are nothing but peons. It is an insurance for both the ministers and the civil servants when they collude to fool the people - but then the truth will always prevail even if belatedly. How do we protect ourselves from bad government? Bad government comes from the lack of wisdom. Strong leadership can lead to bad things, and good leadership without power is a lame duck. I rather a good system in place first and then staff it with the right kind of people.
In everyday life, we all live dangerously. Harm and death await us at every corner. We go about our daily chores like bubbles jumping up and down until we pop and disappear. There is no certainty, and out of this constant fear about the unknown future, we try to manage our immediate environment. In everyday society, this is called politics - the politics of fear, war, and control. Mobilising the power of the mob is the basis of political power. We need a strong leadership that is good, and restrained. A strong leadership that incite the use of violence to control and weld power is the way of the gangster. When gangsterism arises in politics, the countervailing force must be the exercise of the power of law and order by the government. It is the fear of strangers that people choose to congregate in villages and towns and nations. When society does not understand its own people and consider each other strange, we have the ingredients for civil war.
It is modern wisdom that a life is worth the same as all lives. To think of dispensing of someone's life so that one can live is the thinking of a selfish person. To think of dispensing of one's own life so that others may live is usually considered a hero by those who benefited from such actions. Both are incorrect for their extremism.
At the end of the day, the only way to protect oneself from unhappiness is not to fear death but also not to love death. We should use our brains to express ourselves and solve problems which must surely be technical in nature. To charge every issue with emotion is dangerous in an era of mass communication and miscommunication. The only way to protect all of us is through clear thinking and reconciliation, no matter how painful emotionally.
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