“It's proof how deep-rooted untouchability is in our society”-

Judge rubbed his shoes against me, says Justice Karnan

http://timesofindia.indiatimes.com/india/Judge-rubbed-his-shoes-against-me-says-Justice-Karnan/articleshow/10599463.cms

TNN | Nov 4, 2011, 01.38AM IST

CHENNAI: Justice C S Karnan of the Madras high court, who alleged humiliation by fellow judges on November 2 (first reported in TOI), on Thursday said other dalit judges, too, are targeted and their reputation tarnished whenever they assert their self-respect. He added that "more than four or five high court judges" have humiliated him on the basis of his caste and that the National Commission for Scheduled Castes may look into his complaint.

Addressing a crowded press conference in his chambers two days after TOI reported the details of his plea, the judge said he has faced humiliation and embarrassment since April 2009 and it still continues.

"Some judges are very narrow-minded; they seek to dominate dalit judges," Karnan said.

He said he did not rake up the issue all these months as he wanted to safeguard the dignity of the institution. "I was forced to approach the national forum for SCs only after the atrocities crossed tolerable limits," he said, adding that several other dalit judges in the subordinate judiciary too face similar ordeal. "It's a black mark on Indian judiciary," he said.

Justice Karnan claimed that after the National Commission for Scheduled Castes forwarded a copy of his complaint against fellow judges to the Chief Justice of India, he has permitted the panel chairman to hold an inquiry into his allegations.

Asked why he rushed to the forum instead of taking it up with the chief justice of the Madras high court, Karnan said: "The National Commission for SCs is the watchdog for all dalits, including dalit judges, in the country. It is the competent and appropriate body to safeguard the interests of dalits." Justice Karnan reiterated that a judge deliberately rubbed his shoes against him and then trampled a card carrying his (Justice Karnan) name at a function, and said he would reveal the identity of the judge at the time of inquiry. "The judge, sitting cross-legged next to me, touched me with his shoes deliberately and then said sorry. Two other judges were watching it smiling," he said. Justice Karnan claimed that he was discriminated against on basis of caste at several get-togethers such as full court meeting, high tea and dinner. "It's a chain of occurrences, and not once or twice," he said.

On rumours about his transfer, Justice Karnan asked what was the need to do so. "I have given the highest disposal, and all my decisions have been upheld by the higher judicial forum".

The Hindu

“It's proof how deep-rooted untouchability is in our society”

http://www.thehindu.com/news/states/tamil-nadu/article2597303.ece

Special Correspondent

The complaint by a sitting judge of the Madras High Court that he was subjected to harassment on the ground that he was a Dalit demonstrated how strong and deep-rooted untouchability was in our society, the Tamil Nadu Untouchability Eradication Front, affiliated to the CPI (M), said on Thursday.

“How disgraceful it is to note that even a High Court judge has been a victim and that the alleged perpetrators are his colleagues on the Bench. No greater proof is needed to show that the shame of untouchability still remains in our society,” the Front's State president P. Sampath said in a statement here.

The sad and painful aspect of this issue was that judges who were in a position to consider appeals arising from verdicts of subordinate courts in cases involving untouchability and caste atrocities were themselves facing such charges, he said.

If despite the existence of stringent laws against untouchability such practices were still rampant, the responsibility for that should not only be borne by society, but should also be shared by limbs of the State such as the judiciary, executive, police and legislature, he said.

Along with advancement in science and technology, even forms of untouchability appeared to have become modern, Mr. Sampath said, adding that this was revealed during field investigation by the front.

Some of the forms of untouchability that activists had come across included a Dalit being chastised and punished for speaking on a mobile phone in front of a caste Hindu, another being pulled up for having a song with assertive lyrics as his phone's ringtone and even matrimonial advertisements that sought alliances with the tag ‘caste no bar' making an exception for Dalits.

The Hindu

Villupuram records highest number of atrocities against Dalits: study

http://www.thehindu.com/news/states/tamil-nadu/article2597302.ece

Staff Reporter

Sivaganga tops in pendency in court with 395 cases followed by 358 in Madurai

The statistics on crimes against weaker sections released by the State Crime Records Bureau point out that the atrocities against Dalits do not overwhelmingly hinge on the strength of their population in a specific geographical area.

Pitching a field study on the SCRB data, Madurai-based Evidence, a Dalit rights organisation, has inferred under-recording of Dalit atrocities, even though atrocities against Dalits were independent of the strength of their population.

The SCRB-released data had the following statistics. Villupuram, with largest Dalit population in State, has recorded the highest number of atrocities against Dalits with 103 cases; Virudhunagar with 14{+t}{+h} position in Dalit population recording 99 cases; followed by Madurai (excluding Madurai Corporation) with 28{+t}{+h} position in Dalit population recording 93 cases. The report says Vellore, with second largest Dalit population, recorded 27 incidents and Nilgiris in the 19{+t}{+h} position on atrocity.

However, the field survey by Evidence has recorded gross under-recording of violence against women and children under the Scheduled Castes and Scheduled Tribes Act, 1989.

The statistics for an 18-month period from January 2010 to June 2011 point to over 66 incidents of atrocities against women and children. Of these 33 cases, accounting for 50 per cent of cases, fall under rape and sexual harassment.

“The SCRB had recorded just about 24 rape cases under the SC/ST (POA) Act. However, the field study we conducted in just 40 villages of the State revealed nine rape incidents during the same period that went unrecorded under the SC/ST (POA) Act,” says Kathir, Director, Evidence.

Of an average of 1.75 lakh cases registered annually in Tamil Nadu, only 1664 cases (1631 cases on Dalit atrocities and 33 on Tribals) were registered in 2010 under the Act.

According to Mr. Kathir, the State-level Vigilance and Monitoring Committee, mandated to meet every six months to ascertain the functioning of the SC/ST (POA) Act had met just once in 2010 in the last five years.

Pitching its research inference on the SCRB data, the study points to low conviction rates and high pendency rates under the SC/ST (POA) Act.

Despite under-reporting and under-recording of atrocities against Dalits, the conviction rates in crimes against Dalits stood as low as 5 per cent; and at 5.8 per cent conviction in Dalit rapes, with acquittals at 95 per cent.

As of 2010, pendency of cases under the Act stood at 2,092.

Sivaganga has topped in pendency in court with 395 cases; followed by 358 in Madurai; 343 in Villupuram; 277 in Tirunelveli and 205 in Virudhunagar.

The study states that Dalits are pitched against embedded institutional biases at every stage from the recording of complaint up to prosecution and conviction.

The Times Of India

Bigwigs oppose dalit procurement quota, but Sonia mantra does the trick

http://timesofindia.indiatimes.com/india/Sonia-invoked-to-quell-scepticism-over-dalit-procurement-quota/articleshow/10600547.cms

TNN | Nov 4, 2011, 03.49AM IST

NEW DELHI: The proposal to make it mandatory for central government bodies to source at least 4% of their purchases from enterprises owned by Scheduled Castes/Scheduled Tribes was greeted with scepticism in the Cabinet, before an invocation of Congress president Sonia Gandhi made the doubting Thomases fall in line.

Sources said a number of members of the Cabinet, including three who are in-charge of largePSUs, strongly expressed their reservations about the proposal. One the sceptics doubted there were enough entrepreneurs among dalits/tribals to help the government meet the mandatory requirement, while another expressed the fear of quality being compromised.

The misgivings threatened to hold up the decision when one of the attendees reminded his colleagues that it was Congress president Sonia Gandhi who had made a commitment to give preference to dalit/tribal enterprises in government procurements. The Cabinet minister recalled that Sonia, who visited South Africa in August 2007, was impressed by the country's policy to leverage public procurements to encourage businesses promoted by blacks.

The Congress chief, who shared her experience with her colleagues, made it a point to insist on its incorporation in a meeting she presided over in January 2009 to draft the party's manifesto for Lok Sabha polls. Accordingly, the manifesto committed the party to "use government procurement to stimulate entrepreneurship activities among SCs/STs.

The decision, which will generate business worth at least Rs 7,000 crore annually for dalit and tribal entrepreneurs, is to be implemented through Pune-based Dalit Chamber of Commerce and Industry.

A group of dalit MPs belonging to Congress who feel that the decision will help them counterMayawati politically among the dalits in poll-bound Uttar Pradesh and Punjab called on Sonia to thank her for the initiative. The delegation included chairman of National Commission for Scheduled Castes P L Punia, Prem Prakash Guddu, 'Commando' Kamal Kishore, Ashok Tanwar, Praveen Rashtrapal and J D Seelam.

The Hindustan Times

Placements take off at DU

http://www.hindustantimes.com/India-news/NewDelhi/Placements-take-off-at-DU/Article1-764555.aspx

Shaswati Das Shaswati Das, Hindustan Times, New Delhi, November 04, 2011

Last Updated: 00:58 IST(4/11/2011)

The race to grab the most coveted job has begun at Delhi University (DU). While companies have already started making an appearance in some of DU’s colleges, the university’s Central Placement Cell (CPC) is also leaving no stone unturned in seeking lucrative opportunities forstudents.

“The CPC will begin the first round of placements on November 8, the second round on November 29 and it will go on throughout the year,” said Gulshan Sawhney, deputy dean of students’ welfare.

“The companies are looking at recruiting from across all the streams and profiles, including all post-graduate and undergraduate courses. Some companies are giving strong preference to the physically challenged, OBC and SC/ST candidates,” Sawhney added.

However, despite an impending recession in the global market, a foreign organisation is coming to campus to recruit, raising the competition bar much higher among students.

“This year, the main attraction has come from a Japanese organisation called ‘Uniqlo’, which will recruit students and send them for training in after which they will be placed globally. The package that they are offering is R1.25 lakh per month along with benefits. This company wants managers and supervisors and they will be looking out for the best in DU,” added Sawhney.

Colleges too, have much to be proud of with some popular organisations recruiting from within these campuses.

“This year, the placements have begun even before the B-Schools. So far about 100 students have been placed, with the highest package so far touching R10 lakh. American Express has come to campus for the first time this year and other regular recruiters like Ernst & Young, KPMG and Deloitte have already recruited quite a few students,” said PC Jain, principal, Shri Ram College of Commerce.

The Islamist groups and the economic system

http://weekly.ahram.org.eg/2011/1071/op51.htm
3 - 9 November 2011
Issue No. 1071
Opinion
Published in Cairo by AL-AHRAM established in 1875
The Islamist groups and the economic system
The Islamist groups' understanding of economics and modern finance is fundamentally flawed from a religious point of view and may imperil Egypt's future, writes Ahmad Naguib Roushdy* 

----------------------------------------------------------

Now that the ruling Supreme Council of the Armed Forces (SCAF) has set the end of November for elections for the new People's Assembly, it is natural for many jurists, sociologists, economists, bankers and businessmen to ponder how the system of government, social life, banking and business might look if the Islamist groups, individually or collectively, win a majority of the seats in the new parliament.

Although most Egyptians refuse to accept this idea, they could be disappointed. It is always wise to remember the Arabic saying, wataaty al-riahu bema la tashtahi assafon, meaning that the winds bring undesirable things to navigating ships. The Islamist groups are mostly active in rural and urban areas where millions of illiterate people are under the impression that if they vote for secular parties, this could mean the end of Islam in Egypt. If this happens, we should expect enormous changes in every corner of Egypt that could spread to other Islamic countries. 

In my previous four articles in Al-Ahram Weekly since the start of the Egyptian revolution, I have tackled some of the aspects of the constitutional and social systems that the Islamists intend to impose on people, including the loss of democracy and the revisiting of the old Muslim caliphate in a new and deformed shape. Here, I would like to touch on economics and banking transactions under Sharia rules and how the Islamist groups could apply them.

The core element in this regard is the interest paid on savings and loans and on deposits issued by banks to individuals and corporate investors. The Islamists consider interest as reba, meaning usury, which is forbidden by the Quran. The Egyptian civil law recognises interest on loans, and when a monetary obligation in any contract is not fulfilled in due time, four per cent in civil matters and five per cent in commercial matters, with a limit of seven per cent if so agreed by the parties, is levied (articles 226 and 227). 

There are also contracts that the Sharia prohibits, such as al-gharar contracts. If interest payments and such contracts are outlawed, then the Egyptian economy will be turned upside down, and this will affect Egypt's relations with the wider world, especially with countries and organisations that trade or lend money to it, including the United States, the World Bank and the International Monetary Fund. 

Undoubtedly, usury is morally repugnant and sinful in all three religions, and it is forbidden by most countries' laws, even in capitalist economies. Contracts that are based on exploitation by one party over the other, or that are against public morals, are illegal or liable to be annulled or revised to remove the illegal element in many countries. But what exactly is reba and what makes a contract illegal are still matters of controversy.

Reba in Arabic means excess, and Islamic jurists consider excess to be capital that is not qualified to be subject to a legal return. This is reba, and it is forbidden in several chapters of the Quran and in the sunna of the Prophet. In the opinion of the jurists of the four principal Sunni sects of Islam, reba also takes money out of commercial transactions that could otherwise help invigorate the economy, in return for easy profits from loans paid with reba. In the opinion of those jurists, reba discourages people from being benevolent and doing good to others. 

The reason for forbidding reba reflects the Islamic direction to the faithful to do good and to abstain from exploiting others and to eliminate greed. Reba was common in the jahilia (the pre-Islamic era), and among Jewish tribes living in Al-Madina in the Hijaz where the Prophet took refuge after his immigration from Mecca. These tribes were deviating from the Prophet Moses's commandments. 

Some Islamic jurists also despise reba to the extent that they claim it helped rich countries colonise poorer ones. However, the truth is that the development of the banking system and liberal democracy in the West tremendously helped in lifting up western economies. These countries do not consider interest as usury. Instead, they see it as a kind of profit that the lender or the bank is entitled to. They follow this practice in domestic and international transactions. This is not the reason, either, that poor countries were colonised by the West. The desire for strategic security and the availability of natural resources were the main reasons for colonisation.

The undeniable fact is that the prosperity of the western countries, which enables them to control the international economy, is due to the formation of corporations with large amounts of capital able to employ thousands of professional and skilled workers in their own countries and through outsourcing to foreign countries where cheap labour is plentiful. They have also established solid banking systems that can extend loans to corporations and individuals to help investment in the economy. Each of the western countries long ago established governmental agencies, such as central banks and consumer protection agencies, to ensure that the corporations and banks performed according to the rules and offered good services to the public. With large amounts of capital, corporations achieved large profits even in risky projects, notwithstanding their being prohibited from paying interest by clergy who misinterpreted religious rules. 

It was not until after the European Renaissance, itself influenced by Islamic civilisation, that the West discovered the key to prosperity. It is also not true that the West does not recognise reba. Although many western countries permit high interest rates on some transactions, such as credit cards, these countries impose a maximum percentage of interest and consider anything higher as usury ( reba ). After the European Renaissance, the Islamic world went into a deep sleep, submitting itself to the teaching of conservative preachers that prohibited such transactions. This is one of the reasons why the Islamic countries' economies have crawled behind those of the western and Asian-Pacific countries, and why they are still doing so today.

However, there has also been a big difference in opinion among the Islamic jurists about reba. The difference lies not in the prohibition itself, which all agree with, but in which kind of reba is forbidden, especially since there is no explicit guidance in the Quran or sunna. The verses of the Quran that clearly forbid reba were the last to be revealed to the Prophet, who passed away before he could explain how to apply the rules. Because of that, some of the early Islamic jurists felt that they might need to apply the prohibition on reba on transactions that the rule had not been intended to cover, in order to ensure that they were not making a mistake.

The idea that reba is forbidden in the Sharia has been a matter of controversy and debate in Egypt between Muslim clergy and bankers, especially in the late 1970s when several Islamist groups started challenging the government of the late president Anwar El-Sadat after his conclusion of the peace treaty with Israel. The debate intensified when the government, in an attempt to calm the Islamist groups and respond to their demand to abolish secular laws, especially the civil law that permits interest to be levied on transactions, set up committees of jurists to codify Sharia rules. The idea of codifying the Sharia was a good one, as it would have helped to establish unified rules that were available for everyone to read and the courts to apply, instead of depending on the thousands of opinions issued by the leaders of the four Sunni sects and their students, many of which were issued in places and times very different from our own. 

Sadat rushed things through, however, which had harmful consequences. While the modern civil code, introduced in October 1949, took 20 years to be drafted, and contains the rules to be followed in transactions and in other legal matters, some of its provisions borrowed from the Sharia, the codification of the Sharia in the 1970s was brought to a halt after the assassination of Sadat by members of the Al-Gamaa Al-Islamiya in 1981. 

In fact, the debate on interest and the banking system in Egypt was mislabelled as a debate, since it was only really the result of bickering from Islamist groups wanting to impose their opinions and accuse their opponents of being apostates. The groups refused to listen to the opinions of economists and banking experts. As expected, the debate merely ended in an agreement between the parties to disagree with each other. 

The problem today is that the Salafis and other Islamist extremists have now cornered themselves into a strict interpretation of the Quran and the sunna that departs from the path followed by the Prophet, the first four caliphs and the al-salafu assaleh (pious ancestors). Some of these groups, such as the Salafis, refuse to recognise other sources of the Sharia approved by the four major Sunni sects, such as al-ijtihad, al-qiyas and the interest of the community, and, thus, they are not "real" Salafis at all, as I showed in my article in the Weekly in September.

The Sharia, which is supposed to be the path towards correct living, has never been applied to all aspects of life in modern times, which are completely different in terms of scope and technology to people's needs in previous epochs when the Sharia was the law of the land in Islamic countries. What the Islamists have not understood is that Islam does not want Muslims to wrap themselves up in a cocoon and be isolated from the outside world. This is what the Quran warns against when it says, wakhalaqnakum shooba waqabaela letaarafoo (We have created you nations and tribes to get to know each other). This requires Muslims to interact and to establish political, trading and educational relations with other peoples of the world and other religions. Ironically, the West did this as far as Muslims are concerned, borrowing from the Islamic civilisation that extended to China, India and Spain (Al-Andalus).

It has been essential for Muslim countries to consider whether international economic developments and commercial customs conform with Sharia rules and try to review contracts, rights and obligations that the West allows. What happened was that Islamic jurists filled volumes on things that are permitted or prohibited under the Sharia and applied the rules strictly. Because the Sharia is the path to a good life, its main concern is to direct people to what is good and warn them from what is bad on the basis of the universal rule that all acts are permitted unless they are prohibited or are harmful. The rules are based on justice for all, as long as people act honestly and voluntarily in any transactions, contracts, rents, mortgages or lending. 

In an article in the Al-Ahram daily in June 1982, I mentioned that it would not have been easy for earlier Muslims to catch up with international economic developments because of the influence of religion on their daily lives and their hesitation in doing anything that may be prohibited. An example of this is bank interest and contracts that include risk, especially those called oqoud al-gharar, ( oqoud means contracts and al-gharar means risk or danger). These are contracts that contain risks or that deal with something that is accidentally or uncertainly realised. 

Classic examples given by the Islamic jurists include the sale of fish still under the sea, or the sale of birds in the air. The jurists tell us that these kinds of sales are prohibited under the sunna. A perfect example in modern times is selling crops in the field before harvesting them and even before planting seeds. In such cases, prices are fixed in terms of a lump sum, or the value of the crop may be estimated before harvest. This is an international practice in supply contracts and is followed especially in government procurement.

Although Islamic jurists have had different opinions on the details, they agree on the prohibition of gharar contracts if certain conditions apply, at least according to some rules in the sunna. There is nothing in the Quran that could indicate the prohibition of these contracts. The reason for the prohibition is that the profit is "accidentally realised" in the future, though some jurists do permit such futures contracts if there is no risk, as when a farmer sells his crop by the unit, such as in bushels of wheat, and not for a lump sum. Years of development and modern technology have enabled agricultural experts to estimate the size of crops before harvest in a way that matches the actual size, and this can make the deal legal, religiously speaking.

Futures contracts are permitted under the civil law in Egypt in cases where the buyer estimates his future needs and enters into contracts in order to buy for his own use or future resale when the price increases, such that he can avoid a loss if he waits to buy until after the harvest when the price may be higher or when the goods may not be available. This is the true application of the universal principle first championed by Ibn Khaldun, the famous Islamic historian and jurist, in his Al-Muqadema, in which he advised people to buy cheap and sell dear. Ibn Khaldun even called for free trade 400 years before Adam Smith.

The levying of bank interest is problematic, and it has always been a target of attack, not only for Islamist extremists, but also by moderate Islamic jurists, especially because of its proximity to the excess of money during the jahilia, which caused its prohibition in the Quran, and because of a lack of knowledge about banking transactions.

In the past, many Muslims could not imagine themselves dealing in transactions that include interest. One reason was their traditional fear of taking risks in the belief that the Sharia prohibits risks and dealing in transactions that contain reba. This made Muslims prefer to deal in transactions that guarantee them a legal profit, such as investing in real estate and getting a steady income by renting it, or putting it up for sale, which helped delay the creation of modern economic systems in Islamic countries, especially in the Middle East, and the establishment of corporations including investment and development banks that are able to make large investments. 

Egypt was an exception to this rule because of its strategic situation and resources. It was the first country in the Middle East to establish a legal system in 1875 and 1881 comparable to the western one, and a banking system was set up in 1885 when the National Bank of Egypt (NBE), the first banking corporation in the Middle East, was established as a commercial bank and was authorised to issue bank notes, including the Egyptian pound, and carry out other functions of a central bank. In 1960, the NBE was divided into a commercial bank and the Central Bank of Egypt. Many other corporations were established later on that contributed to Egypt's economic growth.

In the past, some Islamic jurists tried to reduce the exaggeration of their colleagues in adding to the list of prohibitions by permitting acts that benefit the Muslim community and prohibiting them if they are harmful to the community. These jurists were applying the al-maslaha al-mursala to serve the interests of the community, and a source in the Sharia was recognised by the early jurists in the absence of a rule in other sources. However, the Salafis and some others do not recognise other sources for the Sharia beyond the Quran and the sunna. As it appears that one country's interest could be different from that of another country and from time to time, jurists of the major Islamic sects followed the path of the early jurists in allowing the government, in the absence of a provision in the Quran, the sunna, or other sources of the Sharia, to permit an act if it benefits the interests of the community.

The problem has been that Islamist extremists refuse to consult banking experts and economists regarding banking transactions, thus deviating from the Prophet's teachings and the practice of the early jurists. They know very well that judges consult experts before ruling on a case if there are details that they are not familiar with. Banks and banking systems are now economic entities worldwide, and they contribute to economic growth. They are needed to serve people, and they compete with each other as long as they act honestly and legally and do not exploit customers. 

Moreover, they do not keep their money in safes or under floors. They invest their capital, composed of shares held by the public and deposits, in order to finance commercial and infrastructure projects that serve the public's interest and yield profits. The banks are thus doing a public service, and they deserve to be paid for that. This comes in the form of interest. When a bank needs more money, it invites the public to open savings accounts or it issues certificates of deposits to the public to buy a certain amount of money for a certain period of time. The bank pays interest on the savings accounts and on the certificates at their expiration date or every six months. Here, the bank is the debtor, but it is still much richer than the depositor, and one cannot consider the bank to be the weaker party or the depositor to have exploited it. The interest here is fixed in advance, required so that each party is aware of his or her rights and obligations. 

I call on Islamist extremists to take the time to read Muamalat al-Bounook wa-Ahkameha al-Shariya (roughly, Banking Transactions and Islamic Rules) by the late Mohamed Sayed Tantawi, former grand imam of Al-Azhar, which was published in 1991 when he was the Mufti of Egypt (an Islamic jurist who presides over a department in charge of rendering opinions on Islamic matters). 

In this work, Tantawi settles the argument regarding reba and on banking transactions and other types of contracts. He decided not to issue an opinion before consulting economists and the heads of banks. I can attest to this because my own late brother, Mohamed Abdel-Moneim Roushdy, chairman of the National Bank of Egypt at the time, informed me that when the Bank was about to issue certificates of deposits he met with the Mufti and they exchanged views on the banking system and Sharia rules on interest and reba. 

Tantawi explains how banks became economic entities essential to economic development, as long as they compete honestly and are just about serving the community. He writes that the interest of the community, al-maslaha al-mursala, necessitates banking transactions as long as they serve the community's interests, but he cautions against setting up general rules in this regard since each transaction should be examined individually. 

He also says that the sources of the Sharia are not just the Quran and the sunna, but are also other sources agreed upon by jurists, including al-ijtihad, al-qiyas, and al-maslaha al-mursala. Tantawi concludes that because international economic development makes transactions different from loans during the jahilia, it is necessary to consider bank loans, certificates of deposits and other banking transactions where the profit is fixed in advance legal and not contradicting the Sharia, since the fixing has no role in permitting or prohibiting these kinds of transactions as long as they are concluded with the consent of the parties involved and are clear of exploitation or fraud. 

Tantawi says this rule is applicable on transactions permitted in Islam, such as sales, rents and mortgages. It should be noted that the author also takes into consideration the traditions and foundations of Egyptian society, which might be different from those of others and need to be examined by experts in the field.

Finally, I also call on the government and the Higher Committee of the Ulema (Islamic jurists) to include this book in the reading of economics and commerce departments at the nation's secular universities and at Al-Azhar, in order that students may understand the issues with open minds. In the same way that Egyptians have revolted against political tyranny in order to recover their rights of freedom of expression, they should revolt against religious tyranny that affects all aspects of their lives.

* The author is an international lawyer. 

The Palestinians and the Myth of Israeli Apartheid

http://www.thejakartaglobe.com/commentary/the-palestinians-and-the-myth-of-israeli-apartheid/475579
The Palestinians and the Myth of Israeli Apartheid
Richard J. Goldstone | November 02, 2011

Palestinian school girls walk past a graffiti on a wall depicting UN humanitarian aid supplies, in Gaza City, Oct. 31, 2011. Palestine became a full member of the U.N. cultural and educational agency Monday, in a highly divisive move that the United States and other opponents say could harm renewed Mideast peace efforts. (AP Photo/Adel Hana) 
he Palestinian Authority’s request for full United Nations membership has put hope for any two-state solution under increasing pressure. The need for reconciliation between Israelis and Palestinians has never been greater, so it is important to separate legitimate criticism of Israel from assaults that aim to isolate, demonize and delegitimize it. 

One particularly pernicious and enduring canard that is surfacing again is that Israel pursues “apartheid” policies. In Cape Town starting on Saturday, a London-based nongovernmental organization called the Russell Tribunal on Palestine will hold a “hearing” on whether Israel is guilty of the crime of apartheid. It is not a “tribunal.” The “evidence” is going to be one-sided and the members of the “jury” are critics whose harsh views of Israel are well-known. 

While “apartheid” can have broader meaning, its use is meant to evoke the situation in pre-1994 South Africa. It is an unfair and inaccurate slander against Israel, calculated to retard rather than advance peace negotiations. 

I know all too well the cruelty of South Africa’s abhorrent apartheid system, under which human beings characterized as black had no rights to vote, hold political office, use “white” toilets or beaches, marry whites, live in whites-only areas or even be there without a “pass.” Blacks critically injured in car accidents were left to bleed to death if there was no “black” ambulance to rush them to a “black” hospital. “White” hospitals were prohibited from saving their lives. 

In assessing the accusation that Israel pursues apartheid policies, which are by definition about race or ethnicity, it is important first to distinguish between the situations in Israel, where Arabs are citizens, and in West Bank areas that remain under Israeli control in the absence of a peace agreement. 

In Israel, there is no apartheid. Nothing there comes close to the definition of apartheid under the 1998 Rome Statute: “Inhumane acts ... committed in the context of an institutionalized regime of systematic oppression and domination by one racial group over any other racial group or groups and committed with the intention of maintaining that regime. 

Israeli Arabs — 20 percent of Israel’s population — vote, have political parties and representatives in the Knesset and occupy positions of acclaim, including on its Supreme Court. Arab patients lie alongside Jewish patients in Israeli hospitals, receiving identical treatment. 

To be sure, there is more de facto separation between Jewish and Arab populations than Israelis should accept. Much of it is chosen by the communities themselves. Some results from discrimination. But it is not apartheid, which consciously enshrines separation as an ideal. In Israel, equal rights are the law, the aspiration and the ideal; inequities are often successfully challenged in court. 

The situation in the West Bank is more complex. But here, too, there is no intent to maintain “an institutionalized regime of systematic oppression and domination by one racial group.” This is a critical distinction, even if Israel acts oppressively toward Palestinians there. South Africa’s enforced racial separation was intended to permanently benefit the white minority, to the detriment of other races. By contrast, Israel has agreed in concept to the existence of a Palestinian state in Gaza and almost all of the West Bank, and it is calling for the Palestinians to negotiate the parameters. 

But until there is a two-state peace, or at least as long as Israel’s citizens remain under threat of attacks from the West Bank and Gaza, Israel will see roadblocks and similar measures as necessary for self-defense, even as Palestinians feel oppressed. As things stand, attacks from one side are met by counterattacks from the other. And the disputes, claims and counterclaims are hardened when the analogy of “apartheid” is invoked. 

Those seeking to promote the myth of Israeli apartheid often point to clashes between heavily armed Israeli soldiers and stone-throwing Palestinians in the West Bank, or the building of what they call an “apartheid wall” and disparate treatment on West Bank roads. While such images may appear to invite a superficial comparison, it is disingenuous to use them to distort the reality. The security barrier was built to stop unrelenting terrorist attacks; while it has inflicted great hardship in places, the Israeli Supreme Court has ordered the state in many cases to reroute it to minimize unreasonable hardship. Road restrictions get more intrusive after violent attacks and are ameliorated when the threat is reduced. 

Of course, the Palestinian people have national aspirations and human rights that all must respect. But those who conflate the situations in Israel and the West Bank and liken both to the old South Africa do a disservice to all who hope for justice and peace. 

Jewish-Arab relations in Israel and the West Bank cannot be simplified to a narrative of Jewish discrimination. There is hostility and suspicion on both sides. 

The mutual recognition and protection of the human dignity of all people is indispensable to bringing an end to hatred and anger. The charge that Israel is an apartheid state is a false and malicious one that precludes, rather than promotes, peace and harmony. 

The New York Times 

Richard J. Goldstone, a former justice of the South African Constitutional Court, led the United Nations fact-finding mission on the Gaza conflict of 2008-

How Free-Market Delusions Destroyed the Economy

How Free-Market Delusions Destroyed the Economy
http://www.informationclearinghouse.info/article24097.htm

By Raj Patel

December 01, 2009 "Information Clearing House" -- If war is God's way of teaching Americans geography, recession is His way of teaching everyone a little economics. The great unwinding of the financial sector showed that the smartest mathematical minds on the planet, backed by some of the deepest pockets, had not built a sleek engine of permanent prosperity but a clown car of trades, swaps and double dares that, inevitably, fell to bits. The recession has not come from a deficit of economic knowledge, but from too much of a particular kind, a surfeit of the spirit of capitalism. The dazzle of free markets has blinded us to other ways of seeing the world. As Oscar Wilde wrote over a century ago: "Nowadays people know the price of everything and the value of nothing." Prices have revealed themselves as fickle guides: The 2008 financial collapse came in the same year as crises in food and oil, and yet we seem unable to see or value our world except through the faulty prism of markets.

One thing is clear: The thinking that got us into this mess is unlikely to rescue us. It might come as some consolation to know that even some of the most respected minds have been forced to puzzle over their faulty assumptions. Perhaps the most pained admission of ignorance happened in a crowded room in front of the House Committee on Oversight and Government Reform when, on October 23, 2008, Alan Greenspan described the failure of his worldview.

Greenspan was one of the acknowledged legislators of the world's economy over the past nineteen years in his role as chairman of the Federal Reserve. A card-carrying member of the free market brigade, he used to sit at the feet of Ayn Rand who, although largely unknown outside the United States, remains influential long after her death in 1982. Her 1957 book Atlas Shrugged, in which heroic business moguls fight the scourge of government officials and union organizers, has once again scaled the bestseller lists. Regarding altruism as "moral cannibalism," Rand was the cheerleader for an extreme free market libertarian school of thought, which she called "Objectivism."

Drawn into her circle by this heady philosophy, Greenspan earned himself the nickname "the Undertaker" for his jolly demeanor and dress sense. When Greenspan chose a career in government, it was rather like a hippie joining the marines, a lapse that his former friends could never forgive. Despite this, Greenspan remained largely faithful to Rand's philosophy, continuing to believe that egoism would lead to the best of all possible worlds, and that any form of restraint would result in disaster.

At the end of 2008, Greenspan was summoned to the U.S. Congress to testify about the financial crisis. His tenure at the Fed had been long and lauded, and Congress wanted to know what had gone wrong. As he began to read his testimony, Greenspan looked exhausted, his skin jowly and sagging, as if the vigor that once kept him taut had all been spent. But he came out swinging. In the first round, he took aim at the information he'd been working with. If only the input had been right, the economic models would have worked, and the predictions would have been better. In his words, a Nobel Prize was awarded for the discovery of the pricing model that underpins much of the advance in derivatives markets. This modern risk management paradigm held sway for decades. The whole intellectual edifice, however, collapsed in the summer of last year because the data inputted into the risk management models generally covered only the past two decades, a period of euphoria.

Had instead the models been fitted more appropriately to historic periods of stress, capital requirements would have been much higher and the financial world would be in far better shape today, in my judgment.

This is a garbage-in-garbage-out argument: The model worked just fine, but the assumptions about risk and data, based only on the good times past, were faulty and so the output was correspondingly wrong. Greenspan's nemesis on the panel, Henry Waxman, pushed him to a deeper conclusion, in this remarkable exchange: 
Waxman: The question I have for you is, you had an ideology, you had a belief that free, competitive -- and this is your statement -- "I do have an ideology. My judgment is that free, competitive markets are by far the unrivalled way to organize economies. We have tried regulation, none meaningfully worked." That was your quote. You had the authority to prevent irresponsible lending practices that led to the subprime mortgage crisis. You were advised to do so by many others. And now our whole economy is paying the price. Do you feel that your ideology pushed you to make decisions that you wish you had not made?

Greenspan: Well, remember, though, what an ideology is. It's a conceptual framework with [sic] the way people deal with reality. Everyone has one. You have to. To exist, you need an ideology. The question is, whether it is accurate or not. What I am saying to you is, yes, I found the flaw, I don't know how significant or permanent it is, but I have been very distressed by that fact.

Waxman: You found a flaw?

Greenspan: I found a flaw in the model that I perceived is the critical functioning structure that defines how the world works, so to speak.

Waxman: In other words, you found that your view of the world, your ideology, was not right, it was not working.

Greenspan: Precisely. That is precisely the reason I was shocked, because I had been going for 40 years or more with very considerable evidence that it was working exceptionally well.
The flaw, to be clear, wasn't a minor one of shoddy data. Nor was it the bigger Black Swan problem that writers like Nassim Taleb discuss, a problem of failing to account for highly unlikely events that, should they happen, involve catastrophic consequences. Greenspan's flaw was more fundamental still. It warped his view about how the world was organized, about the sociology of the market. And Greenspan is not alone. Larry Summers, the president's senior economic advisor, has had to come to terms with a similar error -- his view that the market was inherently self-stabilizing has been "dealt a fatal blow." Hank Paulson, Bush's Treasury Secretary, has shrugged his shoulders with similar resignation. Even Jim Cramer from CNBC's "Mad Money" admitted defeat: "The only guy who really called this right was Karl Marx." One after the other, the celebrants of the free market are finding themselves, to use the language of the market, corrected.

The extent of Greenspan's admission has passed most of us by. If you trawl the oped pages of the financial press, you'll find plenty of analysis that fits Greenspan's first gambit, with pundits offering stories about how risk was incorrectly priced (which it was), how the lack of regulation allowed the panic to feed back into the financial system (which it has), how the incentive structures rewarded traders who were able to push financial risk far into the future (which they did) and how free market ideologues removed the sorts of circuit-breaking policies that might today have helped (and they did that too). But these are all it-could-have-been-fixed-if-we'd-planned-better responses. I am not sure that we're able to comprehend what Greenspan's admission might really mean for us. It would be too big a shock to have the fundamentals of policy in both government and the economy proved wrong, and to have nothing with which to replace them.

It's as if one day, you were to wake up and find yourself transformed into a cockroach. This is the premise of Franz Kafka's novella Metamorphosis. In the first sentence, a young salesman named Gregor Samsa wakes up, after a night of bad dreams, to find that he has turned into an enormous bug. Gregor Samsa's response is revealing, telling us a little bit more about ourselves than we'd like. For what does Samsa do when he discovers he's a bug? He doesn't scuttle from his room screaming, or ponder how this happened, or what his transformation means, and what he might become tomorrow. His response is essentially this: "Poor me! How am I going to keep my job?" Which is almost exactly how we've reacted to this economic crisis. While no one has yet woken up in the body of a bug, we have all found ourselves in a world turned upside down, where everything we were told was to our advantage has turned out to be its opposite. Greenspan's "flaw" has profound repercussions -- to understand it fully would mean a complete reappraisal of the way we conduct our lives. We would need not only a new way of mooring our expectations of our society and our economy, one based on richer assumptions about human nature, but also a different ideology governing the exchange of goods and services.

Prices do some heavy ideological lifting in Greenspan's world. They provide a way to see and know the collective wants and resources of our small planet. This is Friedrich Hayek's economic philosophy, in which prices are the tendrils through which wants and needs are communicated. Science fiction fans will already be familiar with what this looks like. In "The Matrix," liberated humans (and the programs who hunt them) can see the world in its raw form, as a digital rain of symbols and signs. This is the science fiction that governs economic fact. Data pelting down monitors is what the masters of the universe on the global financial exchanges stare at, their eyes darting from screen to screen, trying to see through the world and profit from it. In "The Matrix," the signs were a simulation of the real world, hiding more than they revealed. The trouble is that this unreliable digital ticker tape has now become a central prop in the drama of modern commerce.

Consider the fate of Volkswagen, which at the end of October 2008 managed briefly to become the world's most valuable corporation without having to sell a single vehicle. With the economy still in free fall, traders on stock market floors were taking a dim view of Volkswagen. They looked at their screens and concluded that, just like every other auto manufacturer, Volkswagen was heading for tough times. Imagine you're a trader who feels in your bones that the stock price can only fall. One way to cash your hunch in is to sell Volkswagen stock today, and buy it back when the price falls. Since you don't walk around with Volkswagen stock falling out of your pockets, you'll turn to someone who does, like an institutional investor. You borrow their stock, for a price, and promise to return all of it very soon. The institutional investor is happy because they make money from lending out the stock, which they will get back in one piece. You're happy because you can sell this stock, wait for the price to fall, buy it back and, with the profit, not only pay back the institutional investor, but make the next installment on your yacht in Monaco. This practice is called "shorting."

The trouble was that Volkswagen's rival, Porsche, had started quietly buying Volkswagen stock, aiming to secure 75 percent of the company. When the scale of Porsche's buying spree came to light, it became rapidly clear that there was little of the company left to trade. With Porsche sucking up all the shares, the price for Volkswagen didn't drop. Traders were selling borrowed stock to Porsche, and when Porsche announced its intentions to hold the stock, traders panicked. This led to a "short squeeze," a flocking of investors looking to cover the ill-conceived bets that they'd paid for with stock that they didn't own. They'd wagered that Volkswagen's price, like that of any other car company in a recession, would fall. When it became clear that even if Volkswagen wasn't doing well in the car market, its share price was nonetheless defying gravity, the speculators rushed to buy before the price went any higher.

Their combined purchases drove the price of shares up further. So high did the price rise that Volkswagen entered the DAX 30 index of the largest corporations on the German bourse. This triggered another buying spree, driven not by stock market gamblers, but by their polar opposites -- conservative institutional investors. Pension funds, for instance, invest with an eye to long-term returns; they prefer a slow and certain accumulation of wealth rather than risky bets. One way that they keep their portfolio on an even keel is to buy shares in nothing but blue chip corporations, ones that are guaranteed to be least susceptible to the shocks that stocks are heir to, ones that are in the top, say, thirty corporations traded in the open market. When Volkswagen joined the ranks of the DAX 30, a flock of institutional investors automatically wanted in. So they bought Volkswagen shares at what ever price they could find them. The result? The price per share went from 200 to 1,000 in a week--an increase in company value of 300 billion (244 billion; $386 billion). It made Volkswagen, briefly, bigger than ExxonMobil (with a book value of a mere $343 billion). And for this, the company didn't raise a finger.

In the end, the rules on the DAX were changed, the price settled down and, in 2009, Volkswagen bought Porsche. It is easy enough to tell this story as one where institutional investors got caught with their pants down, where there was imperfect information about the size of the market, where the rules of different short-run and long-run games tangled. But look more closely. Underwriting this version of the story is a conceptual structure that lies beneath every story of excess and crash. The very notion of a bubble relies on the premise that when the bubble pops, things return to a normal state, a situation of price reflecting value more accurately. This is the story told after every boom and bust, from the South Sea Bubble of 1720 to the housing catastrophe of 2008. There's a widely shared opinion that normality will ultimately return to the world economy--but it's a consensus view that rests on a story where bubbles are exceptions to the standard (and successful) procedures of market valuation. If those procedures themselves were flawed, as Greenspan suggests, then our faith in a gentle return to earth is misplaced, for there is and never has been any solid ground beneath our feet.

There is a discrepancy between the price of something and its value, one that economists cannot fix, because it's a problem inherent to the very idea of profit-driven prices. This gap is something about which we've got an uneasy and uncomfortable intuition. The uncertainty about prices is what makes the MasterCard ads amusing. You know how it goes -- green fees: $240; lessons: $50; golf club: $110; having fun: priceless. The deeper joke, though, is this: The price of something doesn't measure its value at all. This prickly intuition has become entertainment. An alien from another planet would find it strange that one of the most popular TV shows in dozens of countries is one that trades on the confusion around what something's worth: "The Price Is Right." In the show, the audience is presented with various consumer durables, and asked to guess the retail price of each. Crucially, you don't win by correctly guessing how useful something is or how much it costs to make -- prices are poor guides to use and true costs of production. You win by developing an intuitive sense of what corporations believe you're willing to pay.

In the world of fund management, the systematic confusion surrounding what something is worth has made some people very rich. Traders' salaries are linked to the returns above expected rates for the risk they take on, the so-called alpha that they contribute to the returns. Think of a bet on a coin flip, with odds of two to one. I bet $1 that I will hit heads, and every time I do, I get $2. In the long run, I'd expect a dollar bet with those odds to return a dollar because I'll come up heads about half the time. But if I'm returning $1.50 on the bet, I'm making magic happen. This magic gets turned back into coins that I get to keep, through bonuses and increased salary. This is a tough trick to pull off because there are only a handful of ways to create added value in fund management -- I can pick undervalued stocks that outperform expectations, I can nurture innovations that change the rules of the game, or I can create new bespoke assets that institutional investors might like.
So we would expect alpha to be rare, and it is, but driven by the desire to cash in, there were many who created fake alpha through bets that appeared to produce consistently good returns despite having a small built-in chance of catastrophic loss. If the expected value of this loss were factored in, the alpha would disappear. But the risks were ignored and bonuses flowed. The frat boys who ran the economy, and profited from its poor regulation, made billions. They were paid today for outcomes that they predicted would happen in the future, using a "mark to model" accounting practice that essentially allowed them to book today what they projected they'd earn tomorrow. This practice was justified on the grounds that "markets know best."

That markets should know best is a relatively recent article of faith, and it took a great deal of ideological and political work to make it part of governments' conventional wisdom. The idea that markets are smart found its apotheosis in the Efficient Markets Hypothesis, an idea first formulated by Eugene Fama, a Ph.D. student in the University of Chicago Business School in the 1960s. In the ideological foundations it provided for financiers, it was a mighty force -- think of it as Atlas Shrugged, but with more equations.

The hypothesis states that the price of a financial asset reflects everything that a market knows about its current and future prospects. This is different from saying that the price actually does reflect its future performance -- rather, the price reflects the current state of beliefs about the odds of that performance being good or bad. The price involves a bet. As we now know, the market's eye for odds is dangerously myopic, but the hypothesis explains why economists find the following joke funny:

Q: How many Chicago School economists does it take to change a lightbulb?

A: None. If the lightbulb needed changing, the market would have already done it.

The problem with the Efficient Markets Hypothesis is that it doesn't work. If it were true, then there'd be no incentive to invest in research because the market would, by magic, have beaten you to it. Economists Sanford Grossman and Joseph Stiglitz demonstrated this in 1980, and hundreds of subsequent studies have pointed out quite how unrealistic the hypothesis is, some of the most influential of which were written by Eugene Fama himself. Markets can behave irrationally -- investors can herd behind a stock, pushing its value up in ways entirely unrelated to the stock being traded. Despite ample economic evidence to suggest it was false, the idea of efficient markets ran riot through governments. Alan Greenspan was not the only person to find the hypothesis a convenient untruth.

By pushing regulators to behave as if the hypothesis were true, traders could make their titanic bets. For a while, the money rolled in. In the mid-1990s, the Financial Times felt able to launch a monthly supplement, titled "How to Spend It," to help its more affluent readers unburden themselves. The magic of the past decade's boom also touched the middle class, who were sucked into the bubble through houses that were turned from places of shelter into financial assets, and into grist for the mill of the financial sector. But ordinary homeowners couldn't muster the clout that banks could: Governments enabled the finance sector's binge by promising to be there to pick up the pieces, and they were as good as their word. When the financiers' bets broke the system, the profit that they made from these bad bets remained untouchable: The profit was privatized, but the risk was socialized. Their riches have cost the whole world dear, and yet in 2009 the top hedge fund managers have had their third best year on record. George Soros is, in his own words, "having a very good crisis," and staff at Goldman Sachs can look forward to the largest bonus payouts in the firm's 140-year history.

What this suggests is that the rhetoric of "free markets" camouflages activities that aren't about markets at all. Goldman Sachs employees are doing well because their firm turned some distinctly nonmarket tricks. Rolling Stone journalist Matt Taibbi has recently revealed, with characteristic verve, how Goldman Sachs has bought the U.S. government. In the Obama administration's economic team, Wall Street has a generation of finance-friendly appointees, from Treasury Secretary Tim Geithner, who arranged a historic $29 billion loan to persuade JPMorgan Chase to acquire Bear Stearns during his tenure as chair of the Federal Reserve Bank of New York; to Larry Summers, who earned $5.2 million by working one day a week for a couple of years in a large Wall Street hedge fund. Their new positions in the White House make them the Tarzans of the economic jungle. Wall Street has reason to be pleased. Goldman had invested heavily in AIG, the insurance giant whose financial products division had brought the 90-year-old giant to bankruptcy. With the 2008 AIG rescue, the $13 billion that Goldman invested was repaid at full face value. Investors in Chrysler, by contrast, stand to get 29 cents for every dollar they invested.

Anyone concerned with democracy should be worried that the seam between Wall Street and the government is almost invisible. At the very least, it raises serious reasons to doubt that the institutions that facilitated the crisis can clean up their mess. Nassim Taleb points to the absurdity here: "People who were driving a school bus (blindfolded) and crashed it should never be given a new bus." The problem is that because both our economy and to a larger extent our politicians aren't really subject to democratic control, the bus drivers are always going to be graduates of the same driving school.

Despite the ongoing hijack of government by Wall Street, a word that hasn't been heard in over a generation is being uttered by politicians: "regulation." It's true that Goldman Sachs and others are profiting handsomely from the collapse, but there is nonetheless a growing sense among politicians that the market may have been allowed too free a rein. Naomi Klein's devastating critique The Shock Doctrine demonstrates how disasters were turned into platforms for rabidly free market policies, and it's an analysis that explains the post-World War II era and today's ongoing financial plunder, from California to Wall Street to the City of London, very well. But there is a recognition among the public and some politicians that today's economic crisis is a failure of free market thinking, and not a warrant for more. In response to popular outcry, politicians around the world seem ready to discuss how to regulate and restrain the market. The question is, can they, and, if they can, in whose interests will this regulation work?

From its inception, the free market has spawned discontent, but rare are the moments when that discontent coalesces across society, when a sufficiently large group of people can trace their unhappiness to free market politics, and demand change. The New Deal in the United States and the postwar European welfare states were partly a result of a consortium of social forces pushing for new limits to markets, and a renegotiation of the relationship between individuals and society. What's new about this crisis is that it's pervasively global, and comes at the last moment at which we might prevent a global climate catastrophe.
Excerpted with publisher's permission from "The Value of Nothing" (Picador, 2010) by Raj Patel. - Visit Raj Patel's site to read more of his work.