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Karl Marx on the opium trade

June 7, 2011 1 comment
Faced with a labour crisis after slave revolts, Europe (specially England) needed alternatives for a new 'slavery' model. A fugitive theorist - Karl Marx. Capitalists and capitalist nations of Europe loved – especially the USA.. Click for bigger image.

Faced with a labour crisis after slave revolts, Europe (specially England) needed alternatives for a new 'slavery' model. A fugitive theorist - Karl Marx gave a model for 'slavery'. Capitalists and capitalist nations of Europe loved – especially the USA.. Click for bigger image.

Marx on the Opium trade

Some 150 years later, Karl Marx’s commentary on the opium trade remains relevant.

Much loved by the capitalists of his time, Karl Marx analyzed opium trade well.

Nurtured by the East India Company, vainly combated by the Central Government at Pekin, the opium trade gradually assumed larger proportions, until it absorbed about $2,500,000 in 1816. The throwing open in that year of the Indian commerce gave a new and powerful stimulus to the operations of the English contrabandists.

In 1820, the number of chests smuggled into China increased to 5,147; in 1821 to 7,000, and in 1824 to 12,639. Meanwhile, the Chinese Government, at the same time addressed threatening remonstrances to the foreign merchants, punished the Hong Kong merchants, (with) more stringent measures. The final result, like that in 1794, was to drive the opium depots from a precarious to a more convenient basis of operations.

The trade shifted hands, and passed to a lower class of men, prepared to carry it on at all hazards and by whatever means. Thanks to the greater facilities thus afforded, the opium trade increased during the ten years from 1824 to 1834 from 12,639 to 21,785 chests.

The year 1834 marks an epoch in opium trade. The East India Company lost its privilege of trading (and) had to discontinue and abstain from all commercial business whatever. It being thus transformed from a mercantile into a merely government establishment, the trade to China became completely thrown open to English private enterprise which pushed on with such vigour that, in 1837, 39,000 chests of opium, valued at $25,000,000, were successfully smuggled into China, despite the desperate resistance of the Celestial Government.

We cannot leave without singling one flagrant self-contradiction of the Christianity-canting and civilization-mongering British Government. In its imperial capacity it affects to be a thorough stranger to the contraband opium trade, and even to enter into treaties proscribing it.

Yet, in its Indian capacity, it forces the opium cultivation upon Bengal, to the great damage of the productive resources of that country; compels one part of the Indian ryots to engage in the poppy culture; entices another part into the same by dint of money advances; keeps the wholesale manufacture of the deleterious drug a close monopoly in its hands; watches by a whole army of official spies its growth, its delivery at appointed places, its inspissation and preparation for the taste of the Chinese consumers, its formation into packages especially adapted to the conveniency of smuggling, and finally its conveyance to Calcutta, where it is put up at auction at the Government sales, and made over by the State officers to the speculators, thence to pass into the hands of the contrabandists who land it in China.

The chest costing the British Government about 250 rupees is sold at the Calcutta auction mart at a price ranging from 1,210 to 1,600 rupees. But, not yet satisfied with this matter-of-fact complicity, the same Government, to this hour, enters into express profit and loss accounts with the merchants and shippers, who embark in the hazardous operation of poisoning an empire.

The Indian finances of the British Government have, in fact, been made to depend not only on the opium trade with China, but on the contraband character of that trade. Were the Chinese Government to legalize the opium trade simultaneously with tolerating the cultivation of the poppy in China, the Anglo-Indian exchequer would experience a serious catastrophe. While openly preaching free trade in poison. it secretly defends the monopoly of its manufacture. Whenever we look closely into the nature of British free trade, monopoly is pretty generally found to lie at the bottom of its “freedom.” (via Karl Marx in New York Daily Tribune Articles On China, 1853-1860 Free Trade and Monopoly; linking text in parentheses supplied; parts excised for brevity and relevance).

Charge of the lite brigade

The nature of the political beast is the same. Welcome to globalization of ideology. A standardized world. No difference at all!

It has been Post WW2 belief that Economic planning and State intervention will work. (Artist - David Low; (1891-1963) Published - Evening Standard, 26 Jun 1944).

It has been Post WW2 belief that economic planning and State intervention will work. (Artist - David Low; (1891-1963) Published - Evening Standard, 26 Jun 1944).

Low-cal, idea-lite brigade

With a collapsing economic base, changing power equations, their social superiority in tatters, the West has created a corps of propagandists, whose  job it is to create red herrings and  dead-end arguments. These content-lite ideologues, manage to put many ‘victims’ on the defensive.

For the past few quarters, we have seen a rising tide of co-ordinated attacks on China, using right-wing Christian rhetoric, from pit-bulls like Hugh Hendry, Jim Chanos, with the Charlie Rose show chiming in, aided by ‘think-tanks’ like CFR.

A recent column, deals with one such nuisance. A banker-economist-columnist, Abheek Barman writes about Ian Bremmer and his latest ‘theses’ about ‘state capitalism.’

Ian Bremmer, a pundit who analyses global political risks at the Eurasia Group, has recently argued that giant companies, backed by governments, are out to capture free markets. Among others, he identifies China, Russia, Brazil – and India – as candidates that practice ‘state capitalism.’

Western auto industry

Is the French and German auto industry anything but State controlled. With governing boards packed with representatives of the various Landesbanks, union representatives, where does private sector classification come from.

'Confidence of the voter' is always useful and preferred. In case it is absent ... does it matter? (Artist RJ Matson - from Roll Call, Date - 7/21/2010 4.02.01 PM).

'Confidence of the voter' is always useful and preferred. In case it is absent ... does it matter? (Artist RJ Matson - from Roll Call, Date - 7/21/2010 4.02.01 PM).

Are we forgetting how Europe’s largest auto-manufacturer Volkswagen, was set up by State initiative? Or how Renault was saved from the ignominy of ‘Nazi’ collaboration by State initiative? How long would the Agnelli Empire last without State support? Are we not forgetting how Chrysler has been saved several times by US State guarantees – and now GM, too!

Banks on a dole queue

A Swiss survey estimates that the Western banks may need US$1.5 trillion in capital-support. Would Mr.Bremmer like to name the likely source for these funds? French banking is public-sector controlled – which in turn controls French industry. Are we saying that Alsthom, ENI and ANSALDO are private creatures!

In the USA, the heavy-hand of the State was plain and for all to see in the handling of LTCM, WaMU, Bear Sterns, Lehman Brothers. Can anyone forget how Robert Rubin, Hank Paulson, Alan Greenspan all had a distinguished private-sector career (mostly at Goldman Sachs) – before and after their positions in the US Government.

Ian Bremmer frequently faults the ‘sovereign funds’ as a ‘marker’ of the State Capitalism’. Are BofA, Citibank, JP Morgan-Chase, RBS, Barclay’s, Credit Lyonnais, Credit Agricole anything but sovereign funds by another name? Was the Western housing bubble anything but an ‘efficient’ cash-tranfer mechanism? US-Fed printed money and the banks distributed – and the State bailed out the banks. A welfare scheme by another name.

And no! I solemnly declare that there was and is no conflict of interest in all this.

Voter apathy is the real objective behind the mock-fights and pseudo-competition - a facade for collusive power-sharing. (Artist - Jeff Parker, from Florida Today, 7/30/2010, 2.02.01 PM)

Voter apathy is the real objective behind the mock-fights and pseudo-competition - a facade for collusive power-sharing. (Artist - Jeff Parker, from Florida Today, 7/30/2010, 2.02.01 PM)

The incestuous bureaucracy

This kind of co-ordination, without an explicit policy, is possible in a close-knit, group, which has a shared value system, and is accepted by the general population. National bureaucracies have followed similar paths across nations.

What is good for General Motors is good for America. In the USA, Fortune 500 corporations, Wall Street firms, top banks serve as recruiting and training grounds for top bureaucrats. In China and the ex-USSR, the overtly political Communist Party was the training and recruiting ground for bureaucrats.

In most other countries, certain ‘secular’ institutions covertly work as training and recruiting rounds for creating an aligned bureaucracy. Top Japanese and French bureaucrats strangely come from one university. For instance, in Japan from The University of Tokyo, Law Faculty and the French ‘enarques’ cut their teeth at Ecole National d’Administration (ENA). The role of Oxbridge in the British Government cannot be understated.

Making the 'right' noises is 'modern' politics! (Artist - Peter Brookes, Published - The Times, 21 Sep 2002).

Making the 'right' noises is 'modern' politics! (Artist - Peter Brookes, Published - The Times, 21 Sep 2002).

Between 1900 and 1986, 45 per cent of permanent secretaries –or administrative heads of government departments –came from Oxford, 23 per cent from Cambridge.

Like Secretary Hillary Clinton correctly pointed out to business leaders in Pakistan, “we tax everything that moves and doesn’t move, and that’s not what we see happening in Pakistan.” Compared to G7, the share of the State in the BRIC nations would be less than 25% of the national GDP.

The nature of the beast is the same, Mr.Bremer. And this goes for you too, Mr.Barman. The world, these days has become ideologically standardized. Welcome to globalization. No difference at all!

And to think! Ian Bremmer accuses the BRIC countries of practicing ‘state capitalism’. Mr.Bremmer, these arguments are futile. Much like the futile British charge of the Light Brigade in the Crimean War, against the Russians. Like the French general said, it is C’est magnifique, mais ce n’est pas la guerre, c’est de la folie. (It is magnificent, but it is not war, it is folly).

Extract from Ian Bremmer in Foreign Affairs

From The End of the Free Market | The Call.

A generation ago, the collapse of communism made clear that government can’t simply mandate lasting economic growth. To fuel the rising prosperity on which their long-term survival will depend, political leaders in China, Russia, the Arab monarchies of the Persian Gulf and other authoritarian states have accepted that they have to embrace market-based capitalism. But if they leave it entirely to market forces to determine winners and losers, they run the risk of enriching those who will use their new wealth to challenge the state’s power.

Instead, they have embraced state capitalism. Within these countries, political elites use state-owned and politically loyal, privately owned companies to dominate entire economic sectors — like oil, natural gas, aviation, shipping, power generation, arms production, telecommunications, metals, minerals, petrochem­icals, and other industries. They finance all these institutions with the help of increasingly large pools of surplus foreign cash known as sovereign wealth funds.

State capitalism isn’t an ideology. It’s more a set of management principles. It can never match the hold that communism once had on the popular imagination, because it wasn’t born as a response to injustice. It was created to maximize political leverage and state profits, not to right historical wrongs. The system is not the same from one country to another, because the ruling elites in Beijing, Moscow, and Riyadh use it to meet distinctly different sets of needs. And no two state capitalist governments can ever fully align their interests. By its very nature, it’s exclusionary; like mercantilism, it promotes one state at the expense of others. That’s why there can’t really be any kind of “state capitalist consensus.”

Instead, you get client states — mainly smaller Asian countries in China’s shadow and energy exporting governments in Africa and Latin America badly in need of friends with deep pockets. Brazil, India and other big emerging markets that have elements of both free market and state capitalist systems have seats at the G20 table alongside some serious free market skeptics. The developed states don’t have much to offer them at the moment that looks attractive for their economic stability.


A shift in position

November 22, 2009 3 comments

Last week, eyebrows were raised over yet another media appearance by the Rashtriya Swayamsevak Sangh chief, Mohan Rao Bhagwat. This time, the fuss centred on his categorical public announcement that the next national president of the Bharatiya Janata Party would not be a Delhi-based leader, and that L.K. Advani would soon relinquish his post as leader of the Opposition. Fortuitously for the Indian foreign policy establishment, his prognosis that Pakistan and Afghanistan “are a part of us and will return one day” did not arouse corresponding attention. (via The Telegraph – Calcutta (Kolkata) | Opinion | A shift in position).

From Ashvakan to Afghans

The task of subduing the Afghan, (a possibly corrupt form of Ashvakan, meaning horse specialists in Sanskrit), from the time of Alexander  to the latest Russian and American misadventures in Afghanistan underscores, the nature of the Indo-Afghan relationship. From the time of Tomyris (Thamyris), when Indian elephant units helped the Afghans to massacre Persian invaders under Cyrus the Great, or when the Afghans hopelessly tied up Alexander.

Alexander’s Indo-Afghan campaign ‘gave him the runs’ (dysentery), his soldiers deserted him in droves, he had to make a marriage alliance, pay nearly 1000 talents (25,000 kg in gold) for an alliance, his dear horse Bucephalus died, he was himself injured twice, made to release prisoners (without a ransom).

End result – he massacred defenceless non-combatant populations and armies alike, when ‘opportunities’ presented themselves.Why did Genghis Khan 'spare' India ...

Islamic ‘conquest’ of India

While Islamic armies were marauding Europe, Central Asia, Africa, India held out. When Genghis Khan’s Mongol armies were running rampant, Islamic refugees found shelter in India, during the reign of Iltutmish. In 1221 Genghis Khan‘s Mongol armies pushed Khwarezm-Shah and other Persian refugees across the Indus into the Punjab, India.

During early Islamic rule, when India was still viewed as militarily difficult target, the Mongols did not think of attacking India.  Remember, that the Mongols attempted to invade Japan, a rather poor country then, without the Sado gold mines! The Japanese blessed their good fortune, when typhoons or (‘The Divine Wind” is what the grateful Japanese called) the Kamikaze, that scattered the Mongol invasion fleet in 1274 and 1281. The Kublai Khan himself barely escaped the fury of the typhoon during the second invasion.

India, the richest economy of the world at that time, with known and famous for its wealth, was spared by Genghis Khan! Just why would history’s foremost looter, invader, pillager spare India?

The Mongol fleet destroyed in a typhoon, ink and water on paper, by Kikuchi Y'sai, 1847

The Mongol fleet destroyed in a typhoon, ink and water on paper, by Kikuchi Y'sai, 1847

Encyclopedia Britannica says Fortunately, the Mongols were content to send raiding parties no further than the Salt Range (in the northern Punjab region), which Iltutmish wisely ignored …” (emphasis mine). As Indian military reputation waned under foreign Islamic rule, the Mongols mounted a military expedition. The Mongols could succeed in India only under the foreign rule of the much-derided Islamic Tughlaks.

End of foreign Islamic rule

The 200-year foreign-Islamic rule from 1206 AD to 1400 AD ended when Ibrahim Lodi, an Afghan horse trader, cobbled together an alliance and sent the incompetent foreign rulers packing. The Lodis, were in turn deposed by another Afghan family, the Mughals.

The Mughals realized, early on, that freedom to Indians was non-negotiable – and enlisted Indian generals, kings, allies to expand their boundaries. The depredations of the foreign ‘Islamic’ rulers were partly reversed by these rulers of Afghan extract – with land reforms, tax reforms, reduction in forceful conversions, et al. The Lodis and Mughals partially reformed the Indic political model – deformed beyond recognition, during the 200 years of foreign Islamic rule. Land holdings remained concentrated in a few hands. Taxes were imposed and increased on the trading classes. Licenses and firmaans were reduced – but remained.

In the last 200 years

The only people who could win against the Afghans were the Indians – last under Ranjit Singhji. The British, and more recently, the Russians and Americans have failed miserably. British possessions of Afghanistan and Balochistan, which were handed to Pakistan on a platter, were a part of the Sikh-Punjab Empire, which fell into the British lap.

Kabuliwala - The movie posterTill about 1960’s India-Afghanistan trade and relations were close and neighbourly. Rabindranath Tagore wrote the short story, ‘Kabuliwalla’. Subhash Chandra Bose escaped from Colonial Raj imprisonment during WW2, using the Afghan route to reach Germany finally.

In early 1970s, in Hyderabad,  कागजी बेदाना अनार (seedless pomegranates) from Kabul, were available at around Rs.4 a kg – at today’s value is about Rs.100 a kg (based on gold prices). Local varieties were sold at less than Rs.1 a kg.

Between 1950 to the post-1973, Nixon Chop world, saw increasing of walls, barriers, battening down of national boundaries. Marxism-Communism seemed relentless and inevitable. Closed economies were seen as the panacea of all problems. Trade was a dirty word. During this period, something momentous happened – a complete and total closure of the Indian mind. India’s international profile underwent a profound change. Indians, who earlier saw the world as a their stage, suddenly retreated into a shell.

Right and wrong

So, yes RSS view is right.

India and Pakistan are a part of the Indic family. What this means is to see Pakistan and Afghanistan not as troublesome neighbours, but as prospective future allies. The Indian political construct was always to surround the Indian heartland by buffer states – like Bangladesh, Nepal, Tibet, Pakistan and Afghanistan. It was not to take over these countries and expand into an unwieldy land mass.

Akhand Bharat ...?

So, when RSS, dreams of an Akhand Bharat, they are wrong. The idea of Bharat was value driven and not power-driven or ruler driven. What Bharat needs to focus on is not to create an Akhand Bharat, but a real Bharat, which will become a model for other countries, especially of the Greater India.

Back to the future

But the Indic model was never to have one king who ruled over others. The Indic model allowed for smaller kingdoms to compete for populations – based on opportunities, freedom, equity. Land holdings in the hands of the populations remained a unique Indian feature for thousands of years – and the West saw this feature only in the last 150-250 years. Religious restrictions in India were not even discussed – unlike the Desert Bloc where the ‘Cuius regio, eius religio’ principle (meaning whose land, his religion; CRER) was established.

In the Desert Bloc, the land, the religion and the very life of all subjects belonged to the king – unlike in India. And that is the Akhand Bharat that we all need to work for!

कागजी बेदाना अनार
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