Liberty - Why Don't People Get It?

For a really really long time, I have been baffled as to why people don't believe in freedom - whether it is economic or social. It often seems like I'm speaking in a different language and people give me looks like I'm talking about a "utopia" that is not practical.

Since his op-ed in the WSJ on health care (thanks Rug!) I've been reading up on John Mackey. (This guy ROCKS! He is really the Ayn Rand Hero of today.) For the first time, I'm starting to see why more people don't believe in freedom or the type of freedom advocated by libertarians. In this transcript of a speech he gave in 2004, he identifies why the Freedom Movement is struggling. In hindsight, I really should have realized this on my own.

Here are a couple of excerpts from the article that got me thinking:

"Let's start with the critique. How many of you have read Ayn Rand? How many of you have been influenced by her? "Atlas Shrugged" remains one of the five greatest novels I have ever read. Who can ever forget characters like Dagny Taggart, Hank Rearden, Francisco d'Anconia, from "Atlas Shrugged," as well as Howard Roark in "The Fountainhead"? These characters all demonstrated tremendous passions and drive, backed by high self-esteem. Each one inspired this young entrepreneur. I wanted to be just like those heroic characters in "Atlas Shrugged."

However, despite her literary greatness and many positive contributions to the freedom movement, I believe that Rand has also harmed the movement. How? She was overly provocative. The "virtue of selfishness" is an oxymoron. Selfishness is not a virtue. Now, I understand all the arguments — I've read all the books. I know that self-interest channeled to the social good, as expressed through Adam Smith's "invisible hand," is the single most brilliant insight about social organization ever made in history. That being said, selfishness (as opposed to self-interest) is still not a virtue. It is something to be discouraged, and not something to be supported."

"When I was a naive (some people in the audience by this time probably think I'm still naive) and idealistic young man, I migrated to the Left for my value system. Why did I do that? Because the Left provided an idealistic vision of the way the world could be. However, the reality of the Left's vision proved to be terribly flawed. Its socialist economic system not only didn't work very well, but in its communist manifestation it justified monstrous governments directly responsible for the murders of over 100 million people in the 20th century. Despite the horrible track record of leftist ideology, millions of young Americans continue to migrate to an intellectually bankrupt Left because the Left still seems to be idealistic, and idealism is magnetic to the young. Idealism will always be magnetic to the intelligent and sensitive young people of the world.

How sad that the freedom movement often refuses to be idealistic. We usually don't even attempt to compete. We simply forfeit the field to the Left because we pride ourselves on our "realism" and "tough-mindedness." We talk about freedom and prosperity — and that is about it. We have no real theory of either the good life or the good society except the fundamental belief that if people have sufficient personal and economic liberties (as in Friedrich Hayek's spontaneous order) we will create a prosperous society.

Freedom and prosperity are important goals, but they must be only the beginning goals for us. If we are to win the allegiance of the young people of America then we must dare to be more idealistic. We must create a vision of the good life and the good society that is irresistible to the young."

On glory that’s past and the danger that’s now....and on movies

Warning: This post ended up longer than intended. But if you stick with it till the end there are two poems – one’s a Hindi/ Urdu classic and the other’s a never-before published original by yours truly.

I am not really a movie buff. Never been. Too impatient for the 3-hr Bollywood kind (forwarding through songs, fights, comedy and romance doesn’t help because there is little left) and too psychic for Hollywood (Kevin Spacey is the killer, Darth Vader is Luke’s dad, Bruce Willis is the ghost) – thanks to Bollywood for the foresight. I do have some favorites (thanks to Quentin Tarantino), but for the most part movies for me are an ordeal.

So the other day, as I lay sulking in my usual physics-grad-studentish misery looking everywhere and anywhere for a pick-me-upper, I chanced upon Rang De Basanti to watch during my ritual morning cardio. I had seen this movie before, at the theater even (a rare treat in midwestern Champaign) and I knew I liked it. But my pensive mood revealed layers and brought forth a powerful reaction that I had somehow previously missed. Let me explain. No spoilers here, so no worries.

Rang de basanti, for the uninitiated, is a Bollywood blockbuster unlike any other. Lets start with the title - the literal title translation is “Color it Saffron” – saffron (basanti) is a deep orange color and is of profound significance in India. It’s a holy color for one and also symbolizes blood. In fact, it’s even featured in the Indian flag – as the first of the three stripes, saffron symbolizes the sacrifice (bloodshed) needed for India to win its independence. There is a less well-known meaning as well, Rang De Basanti was a popular anti-British cry during India’s struggle to break free from the British (damn the British – their accents, their tea, their language and all!). The slogan has its roots in a patriotic song written by Bhagat Singh, a heroic revolutionary freedom fighter. Bhagat Singh in his poem mera rang de basanti chola called for people to dye their robes the color of Spring (spring, the season that symbolizes change is “Basant” in hindi), for times are about to change – the time has come to sacrifice lives if that’s what it takes to get freedom. Thus, Rang de basanti is actually a powerful call to change the status quo. (Obama would have loved it, he needs some Bollywood researches on his campaign)

Just from the depth of the title you are probably beginning to see why this might be a good movie. But the homage to Bhagat Singh (and other Indian revolutionaries) doesn’t end there. The movie is set in contemporary India and draws parallels between revolutionaries of Bhagat Singh's era and modern Indian youth. It’s an ingenious commentary on what it cost our ancestors to fight for our freedom, what we have done with it and how nonchalantly we treat it today. A bloody freedom struggle (from less than 80 years ago) is juxtaposed against our (or more generally the Indian youth’s) irresponsibility to the corrupt Indian political system that is typically cooly attributed to “we-are-like-this-only”. Then it calls for action. To Do something. Anything.

It’s a brilliant movie. Very inspiring. Even the sound track uses patriotic lyrics set to modern tunes. Specifically, they featured one particular old revolutionary poem popularized during the freedom struggle that really made clear the glory of a lost era. To see why, here’s my favorite part (I’ve translated it here –the verse is much more beautiful in Hindi / Urdu and the video is below):

Title: Sarfaroshi ki Tamanna: The desire to sacrifice

There sits the enemy, armed and ready to fire
Ready too are we - to thrust our hearts out to them
With blood we shall play Holi, for our home and country is in trouble -
the desire to sacrifice is now etched within our hearts.

No sword can sever hands that carry the throes of passion,
Heads that have risen won't easily bow when challenged.
It'll flare up even more, the flame struck within our hearts
- the desire to sacrifice is now etched within our hearts.

You can really get a sense for the movie from the this clip featuring the poem:



The first thing that struck me was – no one talks like that anymore. About anything. The words, the values, the passion simply doesn’t exist in contemporary lexicon. Even if they do, they sure as hell don’t carry the same meaning. Don’t we stand for anything anymore? Don't we as a nation, a generation have any cause? Maybe we do. But I was in a coffee shop on campus as I was pondering the movie later in the day and the difference was stark. No, it's not just a cultural thing - and its not specific to India. America has a similar rich history. Our current values or lack-there-of is reflected in everything we do- contemporary art is a joke, a la mode literature is unreadable or depressing at best, and philosophy is out of style. With nothing left to do, I took out my disappointment on pop-culture in an outdated form of expression - verse. Here goes:

Pop goes the Culture

A lost voice a lost cause
Here we rock on without a pause
What we move to- undefined
Synched to the values of our times.

Of our roots, few remain
Best forgotten, coz of the pain?
For it’s a sanguine history that we share
Of freedom-fighters and folk who dared
To stand up for what they breathed-
liberty, justice and to be left in peace.
To arms they took or were beat to death
For the hopes and dreams in unison shared
Of a free world where people walked
Without any fear to mock or talk.

Well, here we are, few suns bygone,
Sheep we are, with no sense of wrong.
Moving to the tunes of time,
Orchestrated by the media chime.

Now we know not what we want,
A pandemonium in faculty, we flaunt.
Like the name, pop it’ll go -
A culture fashioned with mindless woes.

- Rug

Now for the happy ending - The movie did strike a chord. The entire nation rose to salute it. Blogs crept up everywhere urging for action. It was discussed in cafés, shopping malls and classrooms. I’m not sure if anything concrete came out of it. But it sent a message to a whole nation. And I now have a contemporary Bollywood movie I highly recommend. After all, it inspired me to write my second poem. Simply put, this movie is so good that had this been a Hollywood movie, George Clooney would have been proud.

All that glitters can be better than gold

People have been talking about investing in gold for a while now. As Peter Schiff likes to point out, in the Roman Empire an ounce of gold purchased a Roman citizen a toga (suit), a leather belt, and a pair of sandals. Today, one ounce of gold will still buy a man a suit, a leather belt, and a pair of shoes. So gold is definitely a long term inflation hedge. But here are the cons of investing in gold and some other inflation-hedge options.

Cons of Gold:

1) Gold has large volatility and long periods of time (like 20 years around the 80s) when the prices won’t go anywhere.

2) From a contrarian standpoint, we hear way too much about gold now in days. Everyone knows about Cash4Gold etc. For your cash-type ready-to-use money, other useful commodities that have not increased in price as much as gold yet might be better. Oil, Iron, copper, etc. are all great inflation hedges for the same reason as gold. No one can print them. They take hard work to find and unearth, and thus have intrinsic value. And they are not on late night infomercials… yet.

Option 1 – Better -than- gold Tier I stocks

Asset-backed / Necessary-Goods stocks: Gold is *only* an inflation hedge. In the long run you are much better off with a company that is producing something useful, since, over time that company can be worth more, not just the same. So for example any asset backed / commodity stock (oil, energy, food) is a better inflation hedge. The value of any asset backed /commodity company will get automatically adjusted for inflation, which will be reflected in the stock price. A better hedge against inflation is a company that sells something that people will always need, even when they are broke and thus, has a competitive advantage. So they can quickly pass along price-increases and potentially grow your money profitably. Examples of companies like this might be Johnson and Johnson, 3M, etc. On top of inflation-adjustment, you will also see the usual returns/ losses of investing in businesses. It might get hard to decouple the two, but you won't be "wasting" your dollar because of inflation.

Option II - Even- better inflation hedge – Tier II Stocks

Necessary-Goods Companies with High Leverage: The dream inflation hedge would be in a company that apart from selling ever-needed products with a steady stream of earnings (what we call the Tier-I stocks) and having some competitive advantage is also heavily leveraged. Then if inflation does happen, they would able to easily pay back their debt in much cheaper dollars. Now you’ve got a hat-trick - a company with real value, that make something people need, has pricing power and is actually taking advantage of inflation to pay off their debts. Warren Buffett’s purchase of Burlington Northern is a brilliant inflation hedge as it satisfies all these criteria to the T. Large moat, steady earnings, asset based, highly leveraged, and good potential for growth.

Aside: Alternatively, you can take on personal leverage as well, you might be able to find a company that satisfies the dream criteria above AND pays a dividend that will cover the cost of margin for example. Also just taking large loans can make a good inflation bet since you would be able pay them back for a fraction of their original "value". This assumes two things though. 1) You can continue to make the payments. 2) You invest the money in something of value. For example you could buy a house on a highly leveraged basis, subsidized by Uncle Sam.

Option 3: Best bang for your dollar-buck? – Tier III stocks

Highly-Leveraged Necessary-Goods Companies outside the US: The third option is to could invest in tier-II stocks outside the US (the Euro or the Yen for instance) if on top of inflation you are worried about the dollar losing value because of a demotion from its current place as a global currency standard. A global currency standard means that if a French bank and an Indian bank need to conduct a transfer, they would both have to transfer their currency into dollars, transfer the money and then back again. The same is true for buying oil. This means that there is an additional "artificial", if you will, demand for the dollar effectively raising its intrinsic value. There are now talks about replacing the global standard with the Euro, or Yen, or a "bag of currencies" - if this happens, there will a related devaluation of the dollar, which has nothing to do with inflation. For this you could check out countries that Peter Schiff recommends in his book “Crash Proof”. Australia and New Zealand come to mind.

These are fun times we live in. Smart moves can give über -smart returns.

Move the world - lessons for tomorrow's leaders

TED has some of the best talks ever - the content, the message and the delivery are unparalleled. Needless to say, some of the best brains of the world contribute here. This is an exemplary instance of such a skill:

http://www.ted.com/talks/hans_rosling_asia_s_rise_how_and_when.html

Here, Hans Rosling, Professor of International Health at Karolinska Institute and Director of the Gapminder Foundation, which developed the Trendalyzer software system gives a mind blowing talk on how and when Asia will catch up to the Western super powers. Its a powerful talk. Watch it once for the message and then watch it again to learn. He owns the presentation, he owns the stage and he owns the audience . For those of us wanting to be the future movers of the global economy, what can we learn from it?

1. Mastering the art of Presenting <----- Leadership skills

TED or not-TED, every talk you give is momentous. For those 15 minutes, every single person in the room eagerly gives you their undivided attention. At least they want to. So do your audience a favor and deliver. Expectations are high and attention spans are low. You can grab on it, unleash their imagination and take them on a guided tour of your choosing. You need to use everything within your disposal to your advantage. Its not just the slides and a memorized speech any more. You have your whole body - use it. Body language, facial expressions, actions and motion can all be used to communicate. Use articulation - customize tone, speed, volume and emphasis to the point at hand.

Watch Hans walk around stage, use facial expressions, actions and gestures to deliver this talk - he even uses props! Pay extra attention to how he matches his voice to the speed of the animation to convey excitement. He engages you and you are simply drawn in.

Professionally, what can your talk do? Talks are where you plant a seed for powerful change, unveil your expertise, initiate collaborations and bag deals. Not only do passion for a venture and level of knowledge come through, but people will know if you are a natural leader. They are after all witnessing an ultimate test of leadership - can you make people listen? You can establish your stance, making it natural for people to fund your ventures, or recommend you to the C-level . It also a natural icebreaker - you have given them a easy opening line- "nice talk"! Professionally, you need not only excel at giving talks- but you should be seeking them out.

2. Data Showcasing <----- Product placement

All data are not created equal - some are more interesting than the others. Having said that, even if you have the most important message in the world, it will be lost if you don't know how to showcase it. The era of pie charts and excel figures are long gone. Apart from being clear and to-the-point, your graphs need to be alive, dynamic and the center-of-attention. They need to capture attention, help understanding not confusion. Your data contains the meat of the message - serve it tastefully.

How can you boost your business via a talk? This is the man's product - Trendalyzer is a software for animation of statistics. Clearly, he had a very interesting message. This would have been an amazing talk - simply for the message. But he didn't just stop there. Neither did he parade his wares. Hans has a great product and he knows it. He highlights the features of his product by simply using it remarkably well.
Aside: Notice how he casually acknowledges and offhandedly cheers Trendalyzer new owner and Gapminder's business affiliate, Google. Everyone likes to be remembered.


3. World Changing <----- Stepping up your game

It appears to take more than just in depth know-hows and covetable soft skills to be a successful business leader. What is it that sets these visionaries apart? There is a trend these days - aspirations to set make a venture bigger than just the product, to integrate business models with the ever changing socio-economic patterns of today's society, or simply put, to include the guy-in-country-next-door in what you do. Such social moves is not necessarily just a feel-good holier-than-thou reaction or a cosmetic move to erase the popular notion of evil corporations, or even a use-behavioral-economics-to-increase-sales effort, but a necessary step in the evolution of capitalism or a good business. The world is getting flatter, the economy more global and thus capitalism more innovative. Capitalism not only lifts the entire society economically but thrives with the overall health - successful businesses open up doors for new ventures, more capital flow helps create new capital, and great ideas inspire new ones. Enterprise success, like happiness, is addictive. You can see this happening in India right now. Ever since India opened its business doors in the 90's the country is booming, the middle class expanding and the overall health is improving. Measures to uplift society at large is more than a admirable goal - it makes long-term business sense. You are simply making the playing field better. So this new trend, creative capitalism specifically, is a inevitable, but nonetheless brilliant, step in upping the anti. This is what sets the Googles, the Microsofts and Whole Foods of the world apart. Capitalism doesn't work against society - properly executed, it works for the society.

Hans could have used Trendalyzer to track statistics of shoppers and predict hot retail stocks for the holidays- this would have also been quite useful, informative and interesting. From an advertising and clientele point of view, this actually makes more sense. But, he reached out to a wider audience, used his business to impact the world and reached out at TED. By seamlessly integrating a socio-economic message into the product over his entire talk, he made Trendalyzer stand out without ever once mentioning the product. None of this appeared fake or superficial. Here is a visionary entrepreneur and he CARES. Far from suffering for his actions, he now has random blogs blog about his product and obscure scientists think about using Trendalyzer. Absolutely brilliant.

What global impact will your venture have?

Health Care - Where Can I Get A Life Boat?

One of my favorite quotes of Ayn Rand comes from We The Living:

"Do you believe in God, Andrei? No. Neither do I. But that's a favorite question of mine. An upside-down question, you know. What do you mean? Well, if I asked people whether they believed in life, they'd never understand what I meant. It's a bad question. It can mean so much that it really means nothing. So I ask them if they believe in God. And if they say they do—then, I know they don't believe in life. Why? Because, you see, God—whatever anyone chooses to call God—is one's highest conception of the highest possible. And whoever places his highest conception above his own possibility thinks very little of himself and his life. It's a rare gift, you know, to feel reverence for your own life and to want the best, the greatest, the highest possible, here, now, for your very own."

My new favorite question is "Do you believe that the government should provide health care?" I think the answer to this question tells me more about a person's view on individual liberty than anything else I could ask.

Anyway, if the health care public option bill passes after the debate in the Senate floor... I think I'll be ready to admit that we are all on a sinking titanic and start looking for a life boat.

Check out this extremely interesting article on religion and it's impact on the economy:

Satan, the great motivator

Here is a tidbit that should interest everyone:

"... Their results show a strong correlation between economic growth and certain shifts in beliefs, though only in developing countries. Most strikingly, if belief in hell jumps up sharply while actual church attendance stays flat, it correlates with economic growth. Belief in heaven also has a similar effect, though less pronounced. Mere belief in God has no effect one way or the other. Meanwhile, if church attendance actually rises, it slows growth in developing economies."

If that doesn't motivate you to read the entire article, i don't know what will!

On HealthCare

Here is and interesting interview of David Goldhill, the author of the stunningly coherent article "How American Health Care Killed My Father". If you have ever been confused the the debacle that is our health care system, this is the article for you. How is it that doctors can't be bothered to wash their hands properly? How come the doctor gives you a stunned stupid expression of incomprehension when you ask what something costs? Why is my health care stuck to my employer instead of to me? How is it that both doctors AND insurance companies claim their not making enough money? I literally felt the confusion fall away when I read this article, I highly recommend it. And I'm super grateful to APOS for sending it to me.

Video below: