Saturday, May 30, 2009

Transcript of Video-Meeting Noam Chomsky and Saeed Fotohinia Oct 29 2008


Chomsky: How’s it goin?

 

Fotohinia: Yes. Yes.

 

C: Good.

 

F: So, that’s the camera over there.

 

C: Oh.

 

F: Alright. Well –

 

C: Get this out of the way.

 

F: Umm.

 

C: How is this, What is this, what is this gonna be for?

 

F: It’s gonna be for YouTube.

 

C: So, Um, before we get started, I’d like to read a passage from 1984

 

 

F: Uh. To the future or to the past. To a time when thought is free. When men are different from one another and do not live alone. To a time when truth exists and what is done cannot be undone. From the age of uniformity, from the age of solitude, from the age of Big Brother, from the age of doublethink, greetings.

 

F: Uh. So. Uh. Professor can you come forward please.

 

NC: Sure

 

F: Thanks. Uh. So. Hello YouTube. This is Professor Noam Chomsky, whose reputation in the Who’s Who ranges…goes on for almost half a page…the 2008 Who’s Who. My name is Saeed Navid Fotohinia. I’m someone who’s been doing a lot of work with the United Nations. Uh. For example: this is a picture of me with Thabo Mbeki. Uh. This is a picture of me with Jean Chretien.

 

C: Getting around.

 

F: This is Castro. This is the Chief of Defence Staff, when I was in the military, when I was in the Canadian Forces. I was a Second Lieutenant and this is our only General in Canada, General Rick Hillier. And this is an article in the military, the Post Gazette entitled, “Message of Muslim Soldier Intended to Help Troops See Humanity”, and it starts off with: “By his own admission 2Lt. Saeed Fotohinia’s appearance is a contradiction: ‘Take a minute to see the image before you. First you may notice I am Middle Eastern by appearance; then you may notice I am military by dress. As an image I at once fit the profile of a terrorist and an anti-terrorist,’ he said, ‘a vivid oxymoron in green and brown juxtaposed against a glorious red and white.’” In fact, that paragraph is what I was whispering to Rick Hillier when we took that picture. Uh, so, I worked with the United Nations as the kind of organizer of the first youth summit in the history of…to be accredited in the history of the UN. And that took place in 2001 in South Africa and was a great success. However, 9/11 took place right after that, and uh…I’d like to read something from Michael Baer Terrorism get into a little bit of discussion: “Terrorism systematically undermines trust in a context of increasing mutual dependence. As systematically unsystematic violence, terrorism undermines trust on two levels: it undermines the citizen’s trust in their government’s ability or will to protect them, and b) it undermines the citizens trust in one another as individuals. Terrorism thus has the effect of deligitamizing and destabilizing the social institutions and relationships with ones that are based on fear or coercion. Now I bring that up because I know that a  young man, who said he represented the voice of young people, whose real name is Sacha Baron Cohen, but who called himself Ali G, came and interviewed you in the same way that he interviews a lot of other very influential people in the world; and that is by asking questions that are very insincere and that don’t real seek a true answer, and just, instead, lampoon the person who is trying to answer it [sic.]. And um…do you think that 9/11 is a similar breech of the rules of etiquette by one party with a certain ideology on a different…uh…uh…plane.

 

C: I’m afraid I don’t see any comparison. 9/11 was a huge criminal atrocity. It was aimed at killing thousands of people…massive destruction…I don’t see anything amusing about it or anything ironic about it. It’s just a major crime. I must say I wasn’t terribly impressed by Ali G either. In fact I continued the interview only out of politeness; my immediate instinct was just to terminate it.

 

F: Well that’s what I mean. I mean, if Al Qaeda were polite (quote, unquote), they’d go to the United Nations.

 

C: That’s like saying if the United States were “polite”, it wouldn’t invade Iraq. It has nothing to do with politeness.

 

F: Well, I mean.

 

C: This is a matter of achieving political ends. And that, in fact, fits the definition of Terror.

 

F: But..

 

C: It’s the “threat or use of force to attain ideological, political, religious or other ends.”

 

F: How about friendship though? I mean, like a conversation doesn’t need to be about attaining political ends, or a tit-for-tat. It can be about mutual gain. And terrorists as much as the sham voice of young people are equally guilty..or..uh…you know..on a very specific level of…uh…bad manners.

 

C: You see I don’t think it’s “bad manners” to slaughter thousands of people. That’s not the right category. Or let me continue, you quoted someone, I’ve forgotten who, about the effect of Terror…

 

F: Michael Bauer.

 

C: Yeah. There are other comments on the effect of Terror. For example, one important comment is that Terror, if intensifies, tends to leave a culture of Terror, which domesticates the aspirations of the majority of the population and keeps them from even dreaming of pursuing their own ends. That’s an effect of Terror. I happen to be quoting from a Jesuit-led conference in San Salvador, where they’re talking about Reagan’s War on Terror – namely a hideous terrorist war which devastated El Salvador, killed tens of thousands of people, and happened to be, in significant measure, directed against the Church. This conference was led by the surviving Jesuits, many of them were slaughtered by Reagan’s terrorist forces. But I wouldn’t use the word impolite for that.

 

F: Well…

 

C: Would you use the word impolite for the Holocaust?

 

F: Would I?

 

C: Yeah.

 

F: Um. What I mean is…Uh I’m coming from a Linguistic approach, and I definitely share with you the deep sorrow as a person for what happened on 9/11. Personally, as someone who worked at a conference against racism a week before 9/11, I was very much affected by it because, here we were, at the United Nations speaking, writing – you know, young people, seven hundred young people from around the world – writing a declaration against racism and then, on my way back to Montreal, when I was in Heathrow, I hear about these terrible events that actually have changed the entire world. Um, there is no doubt in my that that was an extremely violent and an unmitigated crime against humanity.

 

C: Then why bring up the issue of politeness?

 

F: It’s a question of words. And you recently wrote a foreword to Andrea Moro’s The Boundaries of Babel, and he speaks of a kind of universal language, an approach to a universal grammar, and to give the audience in YouTube a flavour of what he talks about I’ll quote just a little bit from his Preface: “This book is the history of an encounter of the cultures Linguistics and the Neuroscience, or more precisely the Cognitive Neurosciences. It is also the attempt to expose a hidden revolution in contemporary science: the discovery that the number of possible grammar is not infinite, and that their number is biologically limited. I say hidden because, despite the fact that concepts…,” and he goes on from there.

 

C: You’re quoting Moro?

 

F: Yes.

 

C: Yeah.

 

F: Yeah. Is there a root to meaning? Has Terror lost all sense all value as a word? How can we approach the word “God” or swear words…a four-letter word…in a way that encompasses the new biological connection that is being uncovered in Linguistics?

 

C: Well, first of all, the discoveries that Moro is talking about in Linguistics and Neuroscience are quite real, but they don’t impinge on these issues. The connections are so remote that it’s hardly worth drawing. With regard to Terror, we can have a perfectly sencical discussion about it, if we are willing to free ourselves from ideological constraints. So just to be concrete, I’ve been writing extensively about Terror – books, and articles, and talks, giving talks and so on – ever since 1981. That’s when Ronald Reagan came to office and declared that the focus of his administration would be a War on Terror. And it became a huge issue after that. War on Terror. The way the administration described it was, you know, a plague of the modern age, a return to barbarism, and in time, destruction of civilization, so on and so forth. That’s been effaced from history, but the reason is, it instantly turned into a murderous, vicious, terrorist war, which slaughtered tens of thousands of people in Central America, hundreds of thousands in Southern Africa, and all sorts of other atrocities. And that’s not nice to remember, so therefore Reagan’s is off in the…George Orwell’s Memory Hole. But it was there. And, in fact, the Jesuit conference that I cited was referring to Reagan’s War on Terror. But we’re not supposed to think about that. Well, in writing about Terror I’ve committed a serious crime, and it’s denounced bitterly by American…Western intellectuals: namely I use the literal meaning of the term as it’s defined in the U.S. code, in the British…British Laws, in Army Manuals, and so on. Which is a perfectly sensible definition. The…I can’t repeat it verbatim, but something like um, “the calculated threat or use of force against civilian populations to achieve goals that are to..to intimidate…to achieve goals that are political, religious, or ideological in origin, and so on.” Yeah, fine definition of Terror.

 

F: Safe.

 

C: But you can’t use it.

 

F: No.

 

C: You can’t use it for a very simple reason: it doesn’t make a crucial distinction. It doesn’t distinguish between the terror that we carry out against them, which you’re not allowed to talk about…

 

F: Yeah.

 

C: And the terror which they carry out against us, which is a return to barbarism in the modern age, and so and so forth. So if the official definition is unusable and anyone who does use the official definition is a dangerous radical, and so on and so forth. Ah, but this, and therefore you have academic conferences trying to define terror, UN conferences and so on.

 

F: Actually…

 

C: It’s very hard to find a definition that makes the distinction that’s required: it excludes our terror but it includes their terror.

 

F: It’s a inverted psychology, where the, uh, to quote or paraphrase you: the oppressed is not the one who has a jackboot on his throat, it’s actually the one…uh…the one with the jackboot on the oppressed’s throat actually makes himself seem out…seem like the oppressed. Uh…so…to deal with that, I think the United Nations – and that’s why I interjected there – is arming itself with an arsenal of linguistic power…um…and in this Review Conference to the World Conference Against Racism of 2001, which is taking place on April 20th to 24th in 2009, in Geneva, the slogan for it is, uh, “Dignity”…”United Against Racism: Dignity and Justice for All.” And I think that, when it came…was agreed upon – I was there – when the High Commissioner for Human Rights was a former Canadian Chief of…sorry, not Chief of…Chair…Uh…Supreme Court Justice, whose name is Louise Arbour…and when it was announced, there seemed to be – for the first time in my experience with the United Nations – consensus! No…

 

C: There won’t be consensus as soon as you get down to particulars. So take Louise Arbour.

 

F: Okay.

 

C: She was the…ah…if I believe I am remembering correctly…I think she was the first prosecutor in the International Tribunal on the crimes in Yugoslavia…forgot the exact name. I believe it was…it might have been her successor – I don’t remember which. A group of International Lawyers, led by Canadian Lawyers, incidentally, brought to the Tribunal extensive documentations of NATO crimes: that was excluded from the discussion. And, in fact, the prosecutors simply said, “We take NATO word for it, that they didn’t commit any crimes. Okay so that was excluded from the discussion. Yeah, that’s what happens when you get down to details. We can talk about the crimes of others, but we cannot be honest about our own. Just like Terror, just like aggression. And there’s nothing sophisticated about this, you don’t need any Linguistics.

 

F: You have to…you can’t conflate…I mean…you know…an insult with an attack…a crime against humanity.

 

C: That’s why…

 

F: Like Ali G and Al Qaeda.

 

C: That’s why I objected to your original statements. Yes you cannot conflate them. We’re talking about totally different things: you insult somebody, okay; slaughtering them is quite different from insulting them. They have nothing to do with each other.

 

F: But the “Dignity and Justice for All” is a very powerful…

 

C: If you mean it.

 

F: …group of words.

 

C: If you mean it.

 

F: I mean.

 

C: On the other hand, if you what you mean is: ‘dignity and justice for all that we care about,’ it’s quite different.

 

F: Well let’s think about…

 

C: So let’s take 9/11 again.

F: Yeah.

 

C: Everybody agrees: terrible crime, changed the world.

 

F: Yes.

 

C: Could have been worse. Let’s do a thought experiment.

 

F: Okay.

 

C: Let’s imagine that on 9/11 that Al Qaeda had bombed the White House, killed the President, carried out a military coup, installed a vicious military dictatorship, which killed something like fifty to a hundred thousand people, tortured 700 000, established an International Terrorist Centre in the United States, which carried out military coups all over the world…

 

F: Right.

 

C: …assassinated people, and so on…

 

F: How much power would they have though?

 

C: Well…it’s…just listen to me for a minute.

 

F: Ok.

 

C: Suppose that that had happened.

 

F: Ok.

 

C: It would have been worse than 9/11, right?

 

F: It’ be…yes, it would be worse.

 

C: K. It happened. It happened on 9/11.

 

F: Ok.

 

C: It happened on 9/11 1973.

 

F: Ok.

 

C: That was the U.S.-backed coup in Chile. The only thing I’ve changed is…

 

F: Is that it’s the U.S.

 

C: …is per capita equivalence.

 

F: Yeah.

 

C: I’ve changed per capita equivalence – which is the right way to compare them. Other than that, it’s the same. Now why didn’t…that’s what called…

 

F: Well that’s the psy…inverted psychology of oppression.

 

C: It’s not inverted psychology; this is straight simple thinking, nothing sophisticated. Here is a huge crime (much worse than the second 9/11) – did it change the world, do we know about it, is it part of our consciousness? No. Cause we carried it out.

 

F: Well...we…I mean the United States and NATO…and Western…NATO…ah…developed countries…have a great deal more power than a Latin American…

 

C: So, it’s a very simple point. We don’t have to bring in Neuroscience or anything else. Nothing sophisticated. Are we willing to apply to ourselves the standards we apply to others? Very simple. Do we accept the principle of Universality? Namely, if it...if something’s a crime

 

F: There have to be responsibilities…

 

C: …it’s a crime when they commit it or when we commit it. Can we accept that or not? That’s a yes or no question. If yes, okay, then we’re in the same moral arra…

 

F: The system is not united. There has to be a united system whereby all agents who have a wield power can have some kind of…

 

C: No. I’m talking about a decision that individuals have to make: “Am I willing to accept the principle…

 

F: Okay.

 

C: …that if something’s a crime when they do it, it’s a crime when I do it.

 

F: Is it a Capital Crime?

 

C: That’s a separate question.

 

F: The United States is a Capital country.

 

C: Is it the same kind of crime when they do it than when I do?

 

F: Linguistically yes.

 

C: Am I willing to accept for myself the standards that I apply to others?

 

F: Okay.

 

C: If not, you’re out of the moral universe. There’s nothing to discuss.

 

F: There isn’t.

 

C: No. And if…and if it is then we can proceed sensibly.

 

F: And that’s what’s taking place.

 

C: The sophistication is just blowing smoke.

 

F: Let’s talk about oil. I mean…uh…within oil rich countries there seems autocracy that is reigning…no seems to be…no seems, there is. And so, the country…the entire world, becoming more and more dependant on oil producing countries, seems to be becoming more and more influenced, by that autocratic method of…uh…delivering a product, but, at a price – and it’s not a fair price. It’s not a…

 

C: Which? There’s many prices, which one are you talking about?

 

F: The degra…uh…degradation of democratic institutions.

 

C: That’s one price. Another price is destroying an environment in which our grandchildren might survive. Yeah, cause we’re using fossil fuels…

 

F: We’re using…

 

C: That’s another cost.

 

F: And the United States military, which I mention in my…uh…third book, Conditional Love, uhm, is transferring to the same type of synthetic oil for their Air Force that the Germans were using during…to back like over 50% of their military during World War Two, that happens to be a lot more harmful to the environment….Um…

 

C: Well, I’m missing your point.

 

F: Well, it…it’s not just fossil fuel use, but it’s also the breakdown of democratic institutions and institutions of negotiation, and replacing that with…

 

C: It’s also…

 

F: …institutions of military force.

 

C: It’s also the reason for atrocities like invading Iraq, killing a million people, driving out several million, destroying a country…

 

F: Yeah, it’s…

 

C: …a lot of crimes involved.

 

F: It’s a classic “anatomy of revolution” and I have at my disposal a perfect quote from Crane Brinton: “Dictatorships and revolutions are inevitably closely associated because revolutions to a certain extent break down or at least weaken laws, customs, habits, beliefs, which bind men together in society.

And when laws, customs, habits, beliefs bind men together

insufficiently force must be used to remedy that insufficiency.

Military force, is for short terms the most efficient kind of force

available for social and political uses, and military force demands a

hierarchy of obedience culminating in a generalissimo. As Ferrero

[another author] has put it, when ‘silken threads’ of habits,

tradition, legality are broken men must be held together in society by

‘iron chains of dictatorships.’ All this, however, is pretty much a

common place of our times.” Um…given that….

 

C: I don’t know why you’re reading it to me. I mean, a fraction of

that I agree with but I don’t see the relevance of it to what we’re

discussing.

 

F: Well, given that there seems to have been a kind of revolution

after 9/11 – I don’t think many people would disagree with that…

 

C: Why wasn’t there a revolution after the first 9/11, which had far

greater consequences?

 

F: Um…maybe it was because of the political impact that was so closely

tied to it, and, you know, media coverage.

 

C: It’s just that there’s a difference when you commit a crime against

rich and powerful people, and when the rich and powerful commit a

crime against others.

 

F: I agree with you.

 

C: Okay, so, that’s the difference. Let’s be honest about it.

 

F: No…I mean, definitely.

 

C: Fine.

 

F: Yeah, like I just quote you.

 

C: It has nothing to do with Crane Brinton – who I don’t happen to agree with.

 

F: Oh you don’t? Oh. Well I sometimes don’t understand what you write,

like in your Syntactic Structures – to get back to Linguistics – your

Preface starts off by: “Obscure and intuition-bound notions can

neither lead to absurd conclusions nor provide new and correct ones

and hence they fail to be useful in two important respect. I think

that some of those linguist who have questioned the value of precise

and technical development of Linguistic Theory may have failed to

recognize the productive potential in the method of rigorously stating

a proposed theory and applying it strictly to linguistic material with

no attempt to avoid unacceptable conclusions by ad hoc adjustments or

loose formulation.”

 

C: What’s problematic about that?

 

F: It’s just very difficult to understand.

 

C: I’m sorry…but I can’t spell it out more fully. But it sounds

straightforward to me.

 

F: “Avoid unacceptable conclusions by ad hoc adjustments or loose formulation.”

 

C: In other words, if you have some premises and they lead to an

unacceptable conclusion.

 

F: Okay.

 

C: You should either change your premises, find a mistake in your

reasoning, or do something rational. It doesn’t happen…you

shouldn’t…what you shouldn’t do is introduce some ad hoc assumption

that will get you that right…the conclusion you want…that would

deval…you know…change the premises, which would lead to a wrong

conclusion.

 

F: So “absurd conclusions are useful?” Um…. “Obscure and

intuition-bound notions can neither lead to absurd conclusions nor

provide…”

 

C: Oh that can sometimes be useful.

 

F: Absurd ones?

 

C: Sure.

 

F: Okay.

 

C: It shows that your assumptions are wrong.

 

F: Yeah, yeah.

 

C: You know, that’s standard. Don’t forget that’s talking about

Science, not talking about Human Affairs, where you can’t hope…it’s

too complex to hope for…ah…precise, formalized notions. We don’t

understand about ‘em.

 

F: Well…ah…this is where I get into your Cartesian background. I

disagree I’m from a Isaiah Berlin, Vico camp, Giambattista Vico, and

Vico was a adament opponent to Descartes. I mean mathematical

Cartesian Theory of Mind…Um…

 

C: We don’t know what Descartes’s Theory of Mind was because he

destroyed the Volume in which it was presented after the fate of

Galileo at the hands of the Inquisition.

 

F: Oh.

 

C: But I don’t accept the Cartesian framework, you’re picking the

title of a book, which was…the title of the book was about a certain

development in intellectual history…

 

F: No.

 

C: …which was heavily influenced…

 

F: It’s actually…

 

C: …by Descartes.

 

F: No, it wasn’t published in text, it was your debate with Foucault.

 

C: Oh. Okay.

 

F: In that debate, which was recently published…again, I think…you say

– and I know, you know, it’s a lot…very different to say something

than to…

 

C: It’s fine. Quote it.

 

F: …right it down. Okay, but the quote is…and this might be refreshing

to you… “but then that poses”…I can…can I?...okay…um… “Of course

Descartes failed where Newton succeeded, that is, he was unable to lay

the groundworks for a mathematical theory of mind, as achieved by

Newton and his followers, which…”

 

C: Not for mind…

 

F: Uh…

 

C: …as was achieved for mechanics of motion…

 

F: Uh…yeah, yeah.

 

C: Yup.

 

F: Uh…I don’t know if Newton…is that what you mean.

 

C: That’s what it says I’m sure.

 

F: But, “as achieved by Newton and his followers,”…whatever.

 

C: Yes. As achieved by Newton in the domain of which of physical theory.

 

F: But, um…we’re at thirty minutes…

 

C: Pardon?

 

F: We’re at thirty minutes. I’d like to talk about Newton, so we can scrap this.

 

C: Okay.

 

F: Okay. In my second book…uh…I’ll have to scrap that….um…I

actually…uh talk about Newton and his discussion of li…optics…very,

very…uh…critically. Basically, I look at refraction of light, as being

kind of misleading in how it treats the movement of light. Newton ends

up describing light as moving like a corpuscle: neither like a wave

nor a particle…some kind of corpuscle…and even like in the period of

Maxwell – Quantum Theory – they still haven’t dis…you

know…electro-magnetic force is so far the description of the behaviour

of light. So, I went back and I looked at refraction and wavelength,

and in the rainbow (a rainbow is just a refraction of light, like a

triangular prism) you have light coming in and being refracted  into

the major colours, which is red, orange, green, blue, indigo…oh

wait…red, orange, yellow, green, blue…green, blue, indigo…and violet,

but indigo & violet are very similar. So this is the order that they

come in. And red is between wavelengths – and this is all sourced –

760 to 647. Let’s go from the other way, from the bottom, purple has

the shortest wavelength, fastest oscillation; so it goes from 380

nanometers to 424. So that’s purple. 424 to 491…

 

C: Yeah…why don’t you get to your point cause I don’t understand what

this is...where this is leading.

 

F: Okay. Basically this is the order that you come to in wavelength

range. No, just wavelength...you know, just median size. That’s

roughly where it is, after refraction. But if we look at the range of

each of these colours – I went  to the Academy of Visual Arts…

 

C: Yeah, ok, yeah…

 

F: …in…in Vienna, and in front of it, besides the statue of Schiller,

there’s a statue of Goethe. And Goethe was adamantly against Newton:

in 1988 there was a book called…

 

C: That’s true, but what is the point?

 

F: …Goethe Contra Newton…well basically, if we look at the range of

these colours we’ll find that they’re not ordered hierarchically as

the rainbow is. There are certain colours that have a smaller range,

like yellow, than the third place. So if we re-organize these

according to the second spectrum of colour: you get red, green, blue,

orange, purple, yellow. Okay? So that’s one sensical arrangement of

colours, and the rainbow is another sensical arrangement of colours

amid the…hundreds of thousands?

 

C: ….as many as you can find….many other ways. There are lots of

criteria for arranging facts.

 

F: Yeah, but…

 

C: So what?

 

F: Well it hints to a new understanding of science.

 

C: It doesn’t lead to a new understanding of science. I mean that’s

familiar science. Yes, you can organize data on the basis of many

different criteria.

 

F: Yes, but, some of them are sensical and some of them are not.

 

C: Some of them happen to fit within explanatory theories, others are just data.

 

F: Yeah and Newton himself says that all observations…all theories

have to be based on the hypothesis, otherwise they’re…uhm… “Whatever

is not deduced from the phenomena is to be called a hypothesis.” So

this being deduced from the hypothesis…uh…is a new ordering of the

colours. But what’s interesting, is not this.

 

C: I think you’re misunderstanding Newton’s methodology. First of all,

he didn’t literarily mean deduced from the phenomena, nothing can be

deduced from the phenomena. Uh. He meant, we have to be clear about

when we’re talking about phenomena and when we’re introducing

assumptions.

 

F: Yes…

 

C: And we want the assumptions to be such that we can deduce from them

truths about the world we can verify…facts about the world we can

verify.

 

F: Yeah, but I mean if you look at this for one second, I’ll show you

how blue and green – blue, being detracted from orange, swings green

towards orange because green is attracted to orange’s yellow. That

momentum carries the swing around and orange is attracted to red,

because of it’s red. Blue is attracted to purple because of purple’s

blue, and that sticks purple to blue…

 

C: …yeah, I’m afraid you’ve lost me. I also don’t see what this has to

do with what we’re talking about.

 

F: …and then that swings again…hold on, and then, one more swing, like

this, in a similar fashion….

 

C: I’m sorry! I don’t follow what you’re trying to do and I also don’t

see where this is leading.

 

F: Well, I’ve given this to some people at McGill.

 

C: And what is you’re conclusion? Why are you mentioning any of this to me?

 

F: Well, basically that light and science, as explained by Newton, is

not as foolproof as they may seem. Light actually going as a corpuscle

is a hurricane.

 

C: Nobody believes that Newton has anything like a complete theory of

light, but at the most what you’d be saying is that Newton didn’t

explain everything you can imagine in the world. I think everyone

agrees to that.

 

F: Okay…um…

 

C: But…so what?

 

F: It’s a whole book. That’s my second book: Looking for Ultraviolet.

 

C: Okay.

 

F: Um…now let me ask you a question.

 

C: Yeah.

 

F: Um…what word do you think came first: chicken or egg?

 

C: That’s not a serious question because…

 

F: Why not? You hear a chicken, you can’t hear an egg. Like you reproduce…

 

C: You want to know about the evolution of chickens and eggs, well we

look into the…

 

F: No. I’m just talking about the word, like the human word for

chicken and egg.

 

C: There’s no first. I mean…

 

F: We can think about that…

 

C: We can trace the history of…etymology…the history of words back a

couple of thousand years.

 

F: Okay.

 

C: But, uh…in fact, language has been essentially unchanged for more

than fifty thousand years.

 

F: Yeah.

 

C: So what does it tells us if we find the origin of the English word

“Chicken” and the English word “Egg”? Doesn’t tell us anything.

 

F: Well, if, I mean, maybe, you know, some hunter-gatherer reproduced

the sound of a snake before the sound of an egg to another

hunter-gatherer.

 

C: There’s no evidence that the origins of language has anything to do

with things like that.

 

F: Well, Bio-linguistics has nothing to do with any of this?

 

C: Bio-linguistics does not deal with such questions. We cannot look

back 75000 years, roughly, and see how the language faculty developed.

 

F: Okay.

 

C: We don’t have tape-recordings from that era, we don’t have

evidence…we can sort of construct theoretical accounts, which have

some plausibility of how language might have possibly developed but

its not gonna talk about how individual words entered the language.

 

F: Right, and I don’t mean. I mean like the Chicken or Egg question

can answered if we think about the word.

 

C: I don’t think there’s a Chicken or Egg question, but let’s go on.

 

F: Okay. Where would you like to go on? We can go on…I have few fields

we can go into. I discovered a new way help back problems, or reduce

heart pressure…or control heart pressure.

 

C: Well it seems to me like you’ve got a wide range of interests and

concerns but I don’t know what it has to do with me.

 

F: Okay.

 

C: I can’t. I have nothing to say about it.

 

F: So…let’s go on.

 

C: I mean it’s fine. You should be doing all those things.

 

F: Well, you definitely opened up the field to non-experts to, maybe

like, cross the aisle, between science and social science. And that’s

what I think I’m trying to…

 

C: Yeah…I’m afraid, looking at the clock over there, I’m afraid we’ll

have to stop.

 

F: Okay, well, one more.

 

C: Yeah.

 

F: In your debate with Foucault.

 

C: Pardon?

 

F: In your debate with Foucault, you talk about how…you say: “…so one

might say that I’m looking at history, not as an antiquarian who’s

interested in finding out and giving a precisely accurate account of

what the thinking of the 19th Century was (I don’t mean to demean that

activity, it’s just not mine), but rather from the point of view of,

let’s say, an art lover who want to look at the 17th…uh…Century to

find in it things that are of particular value…”

 

C: Yeah.

 

F: “…that obtain part of their value, in part because of the

perspective with which he approaches them.” And I’m very grateful for

your time, so I brought you a….

 

C: Oh! [Unfold large drawing]

 

F: It’s called “State Thugs”

 

C: I’ll have to ponder that. Thank you. It was good to talk to you.

 

F: It’s been the conversation of my life.

Thursday, May 28, 2009

Piracy, Pompey, and Panama

The escalation of piracy and the predicted parallel escalation of NATO
military intervention off the coast of Somalia can be as devastating,
on a global scale, as the assassination of Archduke Franz Ferdinand by
Gavrilo Princip, which cast the die for WWI.

As we all know, piracy dates all the way back to the age of Julius
Caesar, when Pompey Magnus got exceptional powers to rid the
Mediterranean impudent pirates. Things invited immediate attention
from the Senate and the People of Rome when the pirates mocked Rome by
groveling before captured Romans and begging for mercy before making
them walk the plank. Rome (capital R) was not to be slighted in such a
manner. In the words of Robin Seager:

One man, chosen from among the consulars, was to be given the task of
clearing the sea, with the right to appoint fifteen legates with
praetorian imperium, to fit out a fleet of two hundred ships, to levy
troops as requires, and to draw upon the treasury of Rome and the
resources of the publicans in the provinces. The command was to last
three years. The commander’s imperium was to cover all the sea east of
the Pillars of Hercules, all islands, and the coasts of the mainland,
including Italy, up to a distance of fifty miles inland.

The powers that were temporarily bestowed upon General Pompeius turned
out – thanks to the Baby Face’s exceptional success solving the piracy
problem – to pave the way for his ilk (Caesar, Crassus, et al.) to
rise above the checks and balances of the senate, a bloody civil war
to ensue, and the Senate to be sidelined by a succession of Emperors.

To have US Navy Seals off of the coast of Somalia thanks to a handful
of non-state actors set a course towards the repetition of history:
some ambitious Five-Star General is going to be bestowed with
temporary powers to rid the world of a common threat to create an even
greater threat. To borrow from Karl Marx, it is like the husband and
wife who called the doctor to help them resolve a fight only to end up
with the wife having to break up a fight between the doctor and the
husband, then have the husband break up a fight between the wife and
the doctor.

But that is the benign scenario. A much more sinister one lies in
ambitious enemy states engaging an over-abundant portion of the US
Armed Forces by orchestrating a series of similar pirate hijacking of
ships. Much like Lawrence of Arabia was able to occupy much of
Germany’s military force by bombing strategic train routes in Saudi
Arabia during World War I, so can an agent from, say, North Korea,
hinder NATO global interests by praying on such a weakness.

It is widely agreed upon that had Japan bombed Panama instead of Pearl
Harbour during WWII the devastation caused to the Allies would have
been far more incapacitating. This is because trade routes running
through Panama were the lifelines of the West throughout most of the
war. A few aircraft carriers, without sounding insensitive to that
“day in infamy”, were far less crucial to a world war than a major
artery, such as Panama. So is it the case with the Persian Gulf. As a
result of this elevated importance, the final element of caution the
world must apply to this new threat is to not overly romanticize the
pirates and the story, in order to minimize the number of copycats and
sympathizers in the world.

Pirates off Somalia should never been construed with Johnny Depp-like
pirates of the Caribbean, for fear of causing a global shipping
paralysis – and this is all in peace time!

Mr. Fotohinia is a former Second-Lieutenant in the Canadian Forces and
a student of War Studies at both McGill University and the Royal
Military College of Canada. He has recently returned from Vienna where
he attended the Academy of Arts.

Canada and the Peg

If I were the Prime Minister of Canada today, I would pick up the phone and call Obama.

 

“Hello, Mr. President? Yeah, it’s your neighbour upstairs. Would it be alright if we pegged the Loony to your Dollar for the next Quarter?”

 

My reasoning is not simple.  The world economic situation is in a state of disequilibrium caused by a breakdown in fiat money. To understand this let us think of a privately-owned merry-go-round with six ends. Let’s say that this particular merry-go-round is owned by the American boy’s parents. As a result, the other kids don’t mind paying a little tribute to him by allowing him to stop pushing first and start pushing last. Five of the six kids can easily compensate for one rich lazy boy. But then let’s say that the Chinese girl has a big crush on the American boy and only starts and stops pushing according to his pace and not that of the other four. She is able to get away with it because she is situated opposite the American boy on the merry-go-round. While the pace may be substantially slower than if all six were pushing in sequence, and even if only five were pushing in sequence, the merry-go-round still sustains the disequilibrium.

 

At the risk of applying too many real-world concepts to this analogy, I will discontinue it with only one more: Canada, finding itself directly between China and America, could potentially re-establish optimal equilibrium in the fiat money system by also fixing its rate to the American boy’s for a limited period of time. This would nullify any advantage in pushing that the Chinese girl may have gotten by pegging to the American boy, while lightening the burden and maximizing the enjoyment of the remaining three children.

 

China’s Renminbi has been pegged to the U.S. dollar for the majority of the ‘50’s, ‘60’s, and since 1992 – when the Chinese central bank bought and sold as much currency as needed to change the exchange rate from 5.76RMB/$US to 8.62RMB/$US. What this means is that, since very shortly after WWII, the People’s Republic of China has picked the victorious Americans as the merry-go-round of choice; but by artificially selling Mao Zedong-stamped Renminbi at a much lower price than that determined by market forces (the push and whims of the other children) China is effectively flooding the market with its currency – it is selling money “cheap”.

 

My analogy is misleading because it presumes that it is only a generic crush that motivates the Chinese girl to mimic the American boy: it overlooks clear advantages on the merry-go-round and even suggests that the crush will continue off the merry-go-round. In 1964, much to the dismay of the United States and the Soviet Union, China tested its own nuclear bomb. At this very period in China’s history, slave-societies continued to thrive in its remote South-Western borders. For example, of the 56 000 inhabitants of the city of Norsu, in 1959, 47 per cent were slaves. If we consider the economic coercion China practices against Taiwan and the fact that China’s only reaction to adamant American demands to stop pegging has been to filibuster, then the utility of such a mode of economic statecraft within grand strategy becomes crystal clear.

 

Nevertheless, it is not the Canadian way to kick anyone off the merry-go-round. That doesn’t mean that we have or should take a laissez-faire approach to the problems that have and can afflict the world. Especially when we look across at the Rwandan boy, see the new-found light in his eyes; or the Iranian girl laughing with her hair in the wind, against the swirl of the outside playground, the gaze of the not-too-distant guardians.

 

“Why don’t you fly on down, and we can see what we can do.”

 

“Sure thing, Mr. President. Have a pleasant afternoon.”

China's Peg: A Trojan Horse

APPROVED FOR PUBLIC RELEASE; DISTRIBUTION UNLIMITED 

March 6, 2009 

Dear Prime Minister Harper, 

I am writing to you today to present an option that could not only resolve our present economic malaise, but set the stage for multi-fold growth for the decades to come. That option is pegging the Canadian dollar to the U.S. dollar à la People’s Republic of China. 

China’s Peg: A Trojan Horse 

In Virgil’s Aeneid, Father Aeneas recounts the story of the capture of his city by the Greeks: 

                        But if so great desire

      Moves you to hear the tale of our disasters,

      Briefly recalled, the final throes of Troy,

      However I may shudder at the memory

      And shrink again in grief, let me begin. 

      Knowing their strength broken in warfare, turned

      Back by the fates, and years – so many years –

      Already slipped away, the Danean captains

      By the divine handicraft of Pallas built

      A horse of timber, tall as a hill,

      And sheathed its ribs with plankings of cut pine.

      This they gave out to be an offering

      For a safe return by sea, and the word went round.

      But on the sly they shut inside a company

      Chosen from their picked soldiery by lot,

      Crowding the vaulted caverns in the dark –

      The horse’s belly – with men fully armed.1 

The main idea behind this proposal is that the PRC is flooding the currency markets of the world with Renminbi by selling it at a lower price than that determined by market forces. This works well for the PRC’s long-term objectives.  

To mark the bi-centennial of the United States, Herman Kahn, William Brown, Leon Martel and the Staff of the Hudson Institute published The Next 200 Years: A Scenario of America and the World. In the preface we have:  

    Often contemporary issues are not fully understood until they have become history and can be seen in a historical context. To some degree futurology can furnish such a context now by giving us an artificial vantage point from which to look backward; examined in this long-term perspective, current issues look quite different and can be better comprehended. 

     

    Mankind is now operating on such a grand scale that many current activities and programs raise issues that – at least conceptually – can be dealt with only in a much longer time frame. There is an obligation for all – but especially for the most advanced nation on earth h- to define the problems of our future and suggest the means for dealing with them. In effect we are suggesting that both publish and private institutions try to act as an early warning system and as a lobby for the medium- and long-term future; for we believe, to rephrase Santayana, that those who neglect the future risk losing it.2 

To finish the story of Father Aneas: 

    ‘The offering must be hauled to its true home,’

    [The crowd] clamoured. ‘Votive prayers to [Minerva]

    Must be said there!’

                      So we breached the walls

    And laid the city open. Everyone

    Pitched in to get the figure underpinned

    With rollers, hempen lines around the neck.

    Deadly, pregnant with enemies, the horse

    Crawled upward to the breach. And boys and girls

    Sang hymns around the towrope as for joy

    They touched it. Rolling on, it cast a shadow

    Over the city’s heart. O Fatherland,

    O Illium, home of gods! Defensive wall

    Renowned in war for Dardanius’s people!

    There on the very threshold of the breach

    It jarred to a halt four times, four times that arms

    In the belly thrown together made a sound –

    Yet on we strove unmindful, deaf and blind,

    Then, even then, Cassandra’s lips unsealed

    The doom to come: lips by a god’s command

    Never believed or heeded by the Trojans.

    So pitiably we, for whom that day

    Would be the last, made all our temples green

    With leafy festal boughs throughout the city. 

     

                      Opened wide,

    The horse emitted men; gladly they dropped

    Out of the cavern, captains first, Thessandrus,

    Sthenelus and the man of iron, Ulysses;

    Hand over hand upon the rope, Acamas, Thoas

    Neoptolemus and Prince Machaon,

    Menelaus and then the master builder,

    Epeos, who designed the horse decoy.

    Into the darkened city, buried deep

    In sleep and wine, they made their way,

    Cut the few sentries down,

    Let in the fellow soldiers at the gate,

    And joined their combat companies as planned.3 

In a chapter entitled “Exchange Rate Diplomacy” in his book Global Financial Warriors: The Untold Story of International Finance in the Post-9/11 World, John B. Taylor writes: 

    In the hours immediately following the 9/11 attacked, I called my counterparts in the G7. When I reached Haruhiko Kuroda of Japan, he first expressed his condolences and then got right down to business. He suggested that Japan and the United States should by dollars in the foreign exchange market to prop up the value of the dollar. I said that it was best to let the exchange markets adjust to the new information on their own, without government intervention. I would never completely rule out foreign exchange market intervention, but I had followed the markets closely for years and had spent time on the trading floors in New York and Tokyo. My experience made me reluctant to intervene, and that was a policy position held throughout the Bush administration.  

    In fact, the United States did not intervene in the currency markets during my tenure at Treasury. This set a new record, and it was a big change from past administrations. The Clinton administration intervened twenty times in the foreign exchange markets, the last time just before the 2000 president elections. Kuroda had worked with the U.S. Treasury during that intervention, so it was not surprising that he would ask the United States to intervene just one year later. The first Bush administration also intervened in the foreign currency markets, as did the Reagan administration, the Carter administration, and so on. However, I believe that adopting a policy of non-intervention was for the better. Traders soon adjusted their expectations to be absence of the U.S. government in the markets, and as a result the markets have worked more smoothly and with less volatility. 

     

    Japan was not the only country to intervene heavily in the currency markets during this period. The Chinese intervened in even larger amounts. The Chinese were more secretive about their interventions than the Japanese, who regularly informed me of their interventions, a common practice in the G7. In contrast, the Chinese did not inform me of their interventions on a daily basis, but their purpose was no secret. They wanted to prevent the Chinese currency, the yuan, from rising in price against the dollar. The appreciation of the yuan would make Chinese exports more expensive abroad.4 

History of the Peg 

Renminbi/US Dollar exchange rate, 1952-20075
YearRMB/$USYearRMB/$USYearRMB/$USYearRMB/$US
19522.2619662.4619801.5019948.62
19532.6219672.4619811.7019958.35
19542.6219682.4619821.8919968.31
19552.4719692.4619831.9819978.29
19562.4619702.4619842.3219988.28
19572.4619712.4619852.9419998.28
19582.4619722.2519863.4520008.28
19592.4619731.9919873.7220018.28
19602.4619741.9619883.7220028.28
19612.4619751.8619893.7720038.28
19622.4619761.9419904.7820048.28
19632.4619771.8619915.3220058.19
19642.4619781.6819925.5120067.97
19652.4619791.5619935.7620077.61
 

When CNOOC (a state-owned Chinese company) made a bid to buy Unocal Corporation in June 2005, the PRC’s fiscal policies attracted widespread criticism from Congress. Wayne M. Morrison, of the Foreign Affairs, Defense, and Trade Division of the Congressional Research Service, published “China-U.S. Trade Issues” shortly thereafter, which contained the following: 

    U.S. Trade with China 

    U.S.-China trade rose rapidly after the two nations established diplomatic relations (January 1979), signed a bilateral trade agreement (July 1979), and provided mutual most-favored-nation (MFN) treatment beginning 1980. Total trade (exports plus imports) between the two nations rose from about $5 billion in 1980 to $231 billion in 2004; China is now the third-largest U.S. trading partner. Over the past few years, U.S. trade with China has grown at a faster rate than that of any other major U.S. trading partner.6 

     

    China’s Currency Peg 

    China pegs its currency, the yuan, to the U.S. dollar at about 8.3 yuan to the dollar. It is able to maintain this peg because its currency is not fully convertible in international markets and because it maintains restrictions and controls over capital transactions. As a result, China’s exchange rate is not based on market forces. Many U.S. policymakers and business representatives have charged that China’s currency is significantly undervalued vis-à-vis the U.S. dollar (with estimates ranging from 15 to 40%), making Chinese exports to the United States cheaper7, and U.S. exports to China more expensive, than they would if exchange rates were determined by market forces. They complain that this policy has particularly hurt several U.S. manufacturing sectors (such as textiles and apparel, furniture, plastics, machine tools, and tool and die), which are forced to compete domestically against low-cost imports from China, and has contributed to the growing U.S. trade deficit with China. They have called on the Bush Administration to pressure China either to appreciate its currency (by increasing the band in which it is allowed to be traded in China) or to allow it to float freely in international markets. 

    During the mid-1990’s, Chinese officials indicated that they were considering making the yuan fully convertible by 2000. However8, these plans were abandoned as a result of the 1997 Asian financial crisis, when the economies of East Asian countries experienced9a number of economic shocks, including a sharp depreciation in their currencies. China’s currency peg and capital controls were a major factor in enabling China to maintain economic growth and stability, while many of its neighbors experienced sharp economic declines. While Chinese exports suffered somewhat from sharp currency depreciations in several East Asian countries, China pledged not to devalue its currency, a policy that many analysts claim helped stabilize the effects of the economic crisis in Asia and gained China high praise from U.S. officials. 

    Chinese officials argue that its currency peg policy is not meant to favor exports over imports, but instead to foster economic stability. They have expressed concern that abandoning the peg could cause 10 an economic crisis in China and would especially hurt its exports industries sectors at a time when painful economic reforms (such as closing down inefficient state-owned enterprises and restructuring the banking system) are being implemented. Chinese officials view economic stability as critical to sustaining political stability; they fear an appreciated currency could reduce jobs and lower wages in several sectors and thus could cause worker unrest. 

    U.S. critics of China’s currency peg contend that the low value of the yuan is forcing other East Asian economies to keep the value of their currencies low (vis-à-vis the U.S. dollar) in order to compete with Chinese products, to the detriment of U.S. exporters11 and U.S. domestic industries competing against foreign imports. They further note that while China is still a developing country, it has been able to accumulate massive foreign exchange reserves ($659.1 billion at end of March 2005) and thus has the resources to maintain stability of its currency if it were fully convertible. They also argue that appreciating the yuan would greatly benefit China by lowering the cost of imports for Chinese consumers and producers who use imported parts and machinery. Finally, critics of the peg argue that China’s accumulation of large amounts of foreign exchange reserves (in order to maintain the currency peg12) could better be spent on investment in infrastructure and development of poor regions13. 

    Some economists are skeptical over the wisdom of pushing China too hard to appreciate its currency. They note that a significant share of U.S. imports from China is produced by foreign multinational corporations that are increasingly shifting production to China (and other countries) to take advantage of low costs14 there and that a change in China’s peg would do little to reverse this trend. Many warn that, given the weak state of China’s banking system, moving to a fully convertible currency might actually cause the yuan to depreciate, rather than appreciate. Such analysts have called on the United States to press China to implement currency reform in stages over time. Finally, economists note that China is the second-largest purchaser of U.S. Treasury securities ($223.5 billion as of March 2005), which helps the U.S. federal budget deficit and helps keep U.S. interest rates low.  

    Legislations Addressing China’s Currency Policy. A number of bills addressing China’s currency have been introduced in 109th Congress: 

    • S. 14 (Stabenow), S. 295 (Schumer), and H.R. 1575 (Myrick) direct the Secretary of the Treasury to negotiate with China to accept a market-based system of currency valuation, and imposes an additional duty of 27.5% on Chinese goods imported into the United States unless the President submits a certification to Congress that China is no longer manipulating the rate of exchange and is complying with accepted market-based trading policies. H.R. 3004 (English) would require the Treasury Department to determine if China manipulated its currency and to impose additional tariffs on Chinese goods comparable to the rate of currency manipulation.
 
    • S. 377 (Lieberman) directs the President to negotiate with those countries determined to be engaged most egregiously in currency manipulation and to seek an end to such manipulation15. If an agreement is not reached, the President is directed to institute proceedings under the relevant U.S. and international trade laws and to seek appropriate damages and remedies for the U.S. manufacturers and other affected parties.
 
    • H.R. 2208 (Manzullo), S. 984 (Snowe), and S. 1048 (Schumer) adds changes to the criteria that the U.S. Treasury Department is required to consider when making a determination on currency manipulation (including a protracted large-scale intervention in one direction in the exchange markets) in its bi-annual reports on International Economic and Exchange Rate Policies.
 
    • H.R. 2414 (Rogers) would require the Treasury Department to make a determination whether China’s currency policy interferes with effective balance of payments adjustments or confers a competitive advantage in international trade that would not exist if the currency value were set by market forces16. If such a determination were made, the President would be required to bring a WTO case against China to seek across-the-board tariffs17 on Chinese goods in order to offset the subsidy effects of undervaluation.
 
    • Some Members of Congress support changing U.S. law to apply countervailing laws to nonmarket economies so that U.S. firms are able to take action against unfair government subsidies, especially in regards to China.18 They contend that China’s currency peg constitutes a government export subsidy that should be actionable under U.S. countervailing laws. H.R. 1216 (English) and S. 593 (Collins) would apply U.S. countervailing laws to nonmarket economies. H.R. 1498 (Tim Ryan) would apply U.S. countervailing laws to countries that manipulate their currencies19.
 

    On April 6, 2005, the Senate failed (by a vote of 33 to 67) to table an amendment, S.Amdt. 309 (Schumer) to S. 600 (Foreign Affairs Authorization Act), which would impose a 27.5% tariff on Chinese goods if China failed to substantially appreciate its currency to market levels. In response to the vote, the Senate leadership moved to allow a vote on S. 295 (which has same language as S.Amdt. 309) no later than July 27, 2005, as long as the sponsors of the amendment agree not to sponsor similar amendments for the duration of the 109th Congress. However, on June 30, Senator Schumer and other sponsors of S. 295 agreed to delay consideration of the bill after they received a briefing from Administration officials and were told that China is expected to make significant progress on reforming its currency over the next few months.20 

    President Bush on a number of occasions has criticized China’s currency peg, stating that exchange rates should be determined by market forces, and he raised the issue in a meeting with Chinese President Hu Jintao on October 19, 2003. On October 30, 2003, the Treasury Department released its semiannual report on exchange rate policies. Although Treasury was under intense pressure from several Members of Congress to state that China “manipulated”21 its currency (which by U.S. law would have required Treasury to negotiate with China to end such practices), it did not make such a designation22. However, the Bush Administration pledged to pursue the issue with China, largely under the auspices of a joint technical cooperation program, agreed to on October 14, 2003, to promote the development of China’s financial markets and to examine ways China can move more quickly toward a floating exchange rate23 

    The Administration’s position on China’s currency peg appears to have toughened recently. In April 2005, U.S. Treasury Secretary John Snow stated at a G-7 meeting that “China is ready now to adopt a more flexible exchange rate.” On May 17, 2005, the Treasury Department released its latest International Economic and Exchange Rate Policies report to Congress. The reported [sic.] stated that China’s currency peg policy “is a substantial distortion to world markets” and that “China is now ready to move to a more flexible exchange rate and should move now.” The report warned that Treasury would closely monitor China’s progress over the next six months, but did not precisely spell out what moves it expected China to take to make its currency more flexible.24 

In 2005 the U.S.-China Commission argued that across-the-board tariffs were permitted as per Article XXI of the World Trade Organization, “which allows members to take necessary actions to protect their national security.”25 

Possible Outcomes 

In his attempts to avoid a possible Japanese-esk “lost decade”, President Obama has taken a page out of inter-war history and has okayed a stimulus fund meant to build U.S. infrastructure and get America and the rest of the world out of the present economic crisis. This may help stabilize the current crisis somewhat, but let us recall more of the thinking that Cold War-hardened “deep thinkers” such as Herman Kahn et al. have left in The Next 200 Years 

    We frequently find that what is well know is poorly understood, and what is taken for granted is taken without thought. We also disagree with much of the thinking and discussion in academic, intellectual and literary establishments today. Therefore, for both the common and academic wisdom we offer uncommon analysis. The exercise may please some, jar others and perhaps upset more than a few. But we are confident that it will open a new perspective on the issues we discuss. For America and the world – in this anniversary year – we could hardly ask more or offer less.26 

China has an up-to-date and impressive nuclear arsenal: 

    When China detonated its first atomic bomb on October 16, 1964, the United States and Soviet Union faced a new and potentially destabilizing change in the Cold War balance of power. Both countries, along with Britain, had signed the limited nuclear test band treaty in 1963. Both countries had reason to fear the consequences of China’s possession of the bomb. The United States saw China as an uncompromising adversary, and had threatened to use nuclear weapons against the communist state on more than one occasion [The note for this reads as follows: “Such threats were made through statements or nuclear deployments in the Korean War and the Taiwan Straits crises of 1954-1956 and 1958. See Richard K. Batts, Nuclear Blackmail and Nuclear Balance (Washington, DC: The Brookings Institute, 1987), 31-47, 54-62; John Wilson Lewis and Xue Litai, China Builds the Bomb (Stanford: Standford University Press, 1988), Chapter 2; and Melvin Gartove and Byong-Moo Hwang, China Under Threat (Baltimore: Johns Hopkins University Press, 1980), 82]27. The Soviet Union viewed Mao Zedong, China’s leader, as warlike and imprudent. In 1959 it had formally reneged on a promise made in 1957 to give China a prototype atomic bomb. Relations had been deteriorating since that time, and within five years of China’s first nuclear explosion, there would be serious border clashes between the former allies.28 

Just as a refresher, let us look at some classic scenarios for a nuclear escalation:  

  1. Cases of ambiguity, because of either uncertainty of definitions or doubts about the facts or whether the nuclear taboo had indeed been violated
 
  1. Cases with minimal or no collateral damage to civilians, in which the weapons were used mostly or entirely against military targets
 
  1. Cases with uncertainty about the responsibility for the decision to strike, ranging from simple accident, to insubordination, to outright madness and nuclear terrorism
 
  1. Clear and highly destructive nuclear escalation, with definite government responsibility with the world begin inclined to retreat thereafter
 
  1. Clear and highly destructive nuclear escalation, with definite government responsibility, launched by a rogue state, but with a braver outside world response
 
  1. Clear and highly destructive nuclear escalation, but in an ongoing context where two opposing sides are hitting each other with nuclear weapons
 
  1. Clear and highly destructive nuclear escalation, but where the perpetrator retains a major residual nuclear force, with the aftermath perhaps having to take the form of “limited strategic nuclear war”.29
 

Besides the impressive outcome of WWIII, another likely outcome of the breakdown of a stable global trading environment is that the world be thrown into a Dark Age.  

The following is an excerpt from Alan Winnington’s account of the slaves-societies of the remote South-Western borders of China (published only five years before the PRC tested its first atomic bomb):  

    This was indeed the heart of the Norsu area and I was said to be the first non-Chinese to reach it. I spent more than a week in this hamlet of a town, drinking buttered tea from daybreak to late at night, and talking with Norsu slave-owners, slaves and commoners, Communist Party leaders, people responsible for trade, education and medicine, before leaving…By the time I left the town I had a pretty clear picture of Norsu slave-society. 

    In the Cool Mountains – now officially Ninglang County – the Norsu live on the highlands and the other nationalities live in the level basins between the mountains. People who actually are Norsu, those who reckon themselves as Norsu and those who have descended from abducted slaves and claim no other nationality, make up a total of 56,294 as far as they have been counted. Possibly a few others exist in remote valleys by they cannot be many. 

    Of these 56,000, fewer than 3,000 are nobles, the hereditary aristocracy and ruling class, alone having full political, citizenship and property rights. They are tall, healthy and warlike, with a strong belief in the inferiority of all other human beings couple with an exaggerated view of characteristics they think they possess. They call themselves the Nor which means “black” and claim to have “strong black bone”, in the same way as English aristocrats refer to their “blue blood” and think it better than the vulgar sort. (Since su means “people”, Norsu means “black people”.30 

     

    About 47 per cent. Of all the Norsu living in the Cool Mountains are slaves. Most of these are descendents of other nationalities captured and enslaved, though a very large number are first generation slaves, captured within the past few decades as children. This reflects the intensified abduction of slaves since the early ‘twenties. 

    Slaves exits in two categories: “house-slaves” who live in the owner’s house; “separate-slaves” who live in an uncertain state of matrimony in separate households. 

    These are the two aspects of the Norsu slave’s life-cycle. 

    Separate-slaves are called in Norsu Apa-i-su, which means “people sleeping on the side”. Their “marriages” are formed by the master and can be liquidated by him at any time. The slave-owner pairs off male and female slaves, provides a wattle “house” and some land and allows the slaves a small part of their time to cultivate for themselves. This encourages the reproduction of what has now become the main form of wealth in Ninglang – slaves. As one separate-slave said to me: “In the daytime we produce in the fields for our masters and at night we produce for him in our beds.” 

    Children of separate-slaves become house-slaves. 

    House-slaves are called Gashigalu which means “those at the lower end of the fireplace”. They are also know as A-i-zen or “small children”. They enter the master’s house at the age of five or six, when they can perform simple tasks, and their education stops at that point. A slave-owner with enough slaves and a big household may keep one slave doing nothing but carrying water, another milling grain or getting firewood and able to do no other work.  

    House-slaves are divided among their master’s sons and daughters of the same generation when these marry. Boy slaves go to the sons and girl slaves to the daughters. On marriage the girls take their girl slaves to the home of their new husband, who has his share of male slaves. The male and female slaves are paired off as separate-slaves and the cycle begins again.31 

In 1789, Adam Smith wrote the following:  

    By preferring the support of domestic to that of foreign industry, [the merchant] intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intentions. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it.32  

In a book called Grand Strategy, published in 1941, there is the following segment on “Nationality and the Problem of Continual Change”: 

    Watch the everlasting flow of buses in New York, or the unloading of the multifarious merchandise on the docks with the cries of the worker as the long arms of the cranes swings backward and forward in the sunlight. Watch the precision of the traffic lights as the stream of vehicles check and passes on. Move to the suburbs with their comfort-seeking houses, their search for personal pleasure, their gardens, their endless radios and automobiles, each home alike, perhaps, but each expressing an individual’s attempt to furnish and furbish it in a way that pleases him. Go further out, to the fields and hills, to the sound of singing birds in the thickets, the plowing of land, the cutting of trees, the new attempt to make the soil of each farm produce more by the teachings of science, the country towns and villages, the inland cities, the ports and seaside resorts, the blackened industrial areas and the high wind-swept mountains. Imagine the network of roads, railways, canals, and telegraph wires connecting them, the busy broadcasting stations, the movement of people between work and home, between toil and leisure. 

    These glimpses of society might be taken not only from America but from almost any part of the civilized world, for everywhere, despite local differences, men have adopted primarily one method of organizing this vast conglomeration of activities – that of nationality. We have in effect all of us accepted the national structure as the framework within which we shall live and work, take our mates in marriage for better or worse, pay our taxes and grumble, lie down in our beds and die. We are all primarily Frenchmen, Americans, Englishmen, Germans and so on, rather than rich men, poor men, or middle-class workers. “The nation is the political unit, and nationalism the group symbol of the present stage of civilization.” It is this fact which gives the modern world its peculiar character and forces upon it many of its special problems. 

    In a world of competition, one of these problems is the question of development. Imagine a modern nation which fails to move with the times. Gradually it will fall behind in its scientific discoveries. Its factories will no longer be equipped with the latest techniques. Its products will cease to appeal in the markets of the world. Its financial and other resources will have to be extravagantly drawn upon to maintain an adverse trade balance. Soon its war potential and power of armed resistance will be sapped. Its whole safety will be in danger. Thus in the last resort a modern nation finds itself dependent for its entire existence upon this basic ability to evolve – so much so that whatever induces progress is of vital national importance as the key to the everlasting struggle for survival. Yet how is such progress to be ensured? After all, it is not the normal wish of those in control to have incessantly to be making changes and adjustments. Would a signalman on a railway be particularly pleased to have the signals he already understands changed to a set he does not know? Surely only when his own system is proved so bad that the new effort is adequately compensated for by the extra efficiency it brings. But that moment in a world of struggle is often too late. Changes which have been put off for too long bring no lasting benefits.33 

Possible Solutions 

To consider the three possible solutions available to Canada at this stage, it would be a good idea to consider some concepts about money: 

    Fiat money is a type of paper or symbol with which any individual may buy most things by law. It has virtually no intrinsic value but immediately assumes a trading value when its shortage (i.e. when it is no longer a stack variable to everyone in the appropriate set of simultaneous programs) can prevent trades that would have been deemed profitable in a monetary competitive equilibrium system.34 

An equilibrium system based on fiat money is no longer globally enjoyed due to the massive commodification of the Renminbi (translated as “the people’s money”). In lieu of this development we must consider the Quantity Theory of Money. Unfortunately: 

    Hardly any theory in economics has been so long debated as the quantity theory of money. Yet, no thorough analysis of its original content and purpose, of its historical development, and of all its numerous misinterpretations has been undertaken. Thus there is still no unanimity as to the formulation and interpretation of the quantity theory. Almost every economist has written something about the quantity theory, but only a very few have manifested a correct understanding of it. This lack of clear definition is, curiously enough, very much due to the simplicity of the theory; it has occasioned a vagueness in its formulation which has lead to innumerable misinterpretations of its content. Indeed, the poet’s words: ‘the simple thing is the difficult thing’, seems to be more than a rhetoric phrase.35 

The first solution is moot: make no change. This will lead to the PRC continuing to filibuster about it’s currency exchange strategy, more and more U.S. dollars to concentrate in the Chinese Central Bank’s reserves, and an even larger amount of Mao Zedong-stamped RMB’s propagating throughout the world.  

If Canada does not make economic accommodations now for China’s preponderance, it will soon have to make social and political ones. 

The second solution is the Amero. This, would lead to a European-style socio-political imbroglio. Let us consider some common language on the European Economic Union monetary union issue:  

    The plans for a common currency and the economic union were treated in the EEC in an organic unity. The maintenance of fixed exchange parities is in itself an irrealistic [sic.] aim. The inflation of the national currencies, which is very likely to develop differently both in size and rate, will result in a relative over- and undervaluation of the individual currencies. The different growth rates of efficiency and productivity would yield the same results. And the under- or over-valuation of the currencies may give rise to cumulative tensions in respect of both the equilibrium of fixed exchange rates and balances of payments and, in the long run, of growth, modernization and export expansion. Therefore, the maintenance of the equilibrium of the balances of payments within the area presupposes collective aid and reserve funds, as well as comprehensive co-ordination of financial policies (issue of banknotes, interest and credit conditions, etc.) and budgetary policies (taxes, state expenditures, etc.). In connection with the long-run problems, the necessity of harmonizing structural differences, of co-ordinating regional and social policies also emerges. Thus, monetary union based on fixed exchange rates and economic union can only jointly be achieved. This is also reflected in the plan of the economic and monetary union of the EEC. 

    The plan of the monetary union accepted in 1971 set the aim of realizing a common currency and economic union by 1980. In the interest of fixed exchange rates, the member countries narrowed down, on the one hand, the respective floating margins of their currencies. They had planned to reduce these margins to 0.60 per cent, but it failed to materialize because of the international monetary crisis. In 1972, a ±2.25 per cent floating margin was introduced on a mutual basis, which followed from halving the ±4.5 per cent floating margins accepted in the currency reform of December 1971. The central banks of the member countries set up in 1970 a short-term support fund of 2 billion dollars to tide over the temporary balance of payments deficits. In April 1973, with more than a year’s delay, the so-called European monetary co-operation fund was created, which started its activity with 1.4 billion units of account in July 1973. The fund was assigned as its primary task to organize multilateral settlements relating to the ensurance [sic.] of the narrowed-down margins of floating exchange. Included in the aims of the fund is the elaboration of a concerted reserve policy, which may lead in the future to the gradual merging of national reserves. The fund has also taken over the task of operating the system of a common short-term support. Many regard the fund as the core of a common central bank of the EEC. To keep the floating of currencies within a “channel”, common intervention mechanisms have been set up at the short- and medium-term co-ordination of the economic policies of the member countries, especially for a collective action against inflation.36 

However highfaluting the sound of Economic Union may seem to Canadians today, it would still not address the advantage proffered unto the PRC by the RMB/$US peg.

The third solution is to peg the Canadian dollar to the U.S. dollar37 for three month, in order to maintain and stimulate growth in all sectors of Canadian industry. 

For those who are concerned by the notion of setting too much store by the Americans, I will conclude with the following passage from Livy: 

    …The city [of Rome in 492 B.C.] was in great apprehension; all business came to a halt from mutual dread: the plebs left behind feared violence from the senators, while the senators, wary of the plebs who remained, could not decide whether they preferred them to have stayed or to have departed. Besides, how long would the multitude that had seceded remain quiet? And what would happen if some outside military emergency arose in the meantime? They became convinced that no solution existed except in concord among all citizens: the plebs must be reconciled to their country at all costs. 

    So they decided to send to the plebs Menenius Agrippa as their spokesman, a forceful speaker whom the plebs liked, for he had come form their ranks. On being admitted to the camp his speech is said to have consisted simply of the following parable, couched in old-fashioned and homely language. Once upon a time man’s bodily parts did not work as one as they do now, but each limb went his own way and had his own voice. The other parts unhappily complained that the belly received the benefit of their care, help, and hard work and that it stayed contentedly in the middle doing nothing but enjoying the good things they gave it. They then concocted a plan: the hands would not carry food to the mouth, the mouth would not accept food if given, the teeth would not chew it. They aimed to starve the belly into submission, but their anger brought the limbs and the whole body close to wasting away completely. Then it dawned on them that the belly’s job was important: it received as much nourishment as it gave back, carrying everywhere that by which we live and breathe – our blood, which, enriched by the food we digest, spreads through the blood vessels to all parts of the body. By comparing the internal revolt of the body with the anger of the plebs against the senators, Agrippa brought the plebs round to his way of thinking.38 

I send your, dear Excellency, the expression of my highest consideration and remain meanwhile, 

Yours sincerely, 
 

Saeed Fotohinia

Representative

Youth Against Racism

P.S. Special thanks must go to Prof. Desmond Morton, Prof. Noam Chomsky, and the Library Staff at McGill University.