Sunday, 30 December 2012

Mindset that generates intolerance

Mo Chaudhury

Binary mindset and intolerance

December 29, 2012

Photo: Reuters

What is the common defining element of extremism, polarization, either or, anything but, and my way or high way? The answer is that they are all binary or digital (zero/one) in nature since they define things in terms of two disjoint and inherently adversarial alternatives. This is what I refer to as the binary mindset. My thesis is that the binary mindset is the boson (God Particle) of intolerance.

Intolerance is much like the corner solution of economic theory where, for example, a consumer chooses either to buy as much food as she can afford or rent the biggest possible residence, meaning that either she does not have a place to live or she goes hungry. Intriguingly, such extreme consumption choices are optimal when the consumer is obsessed with a commodity and never gets tired of consuming more and more of it. In real life, rarely we observe such extreme consumption preference and behavior. Instead we find interior solutions to be prevalent meaning that most consumers spend their income on food as well as housing. The powerful message is that amalgams, mixtures, combinations, unions, and diversity represent moderate and balanced outcomes, and very importantly they result from mindsets that are not binary, and are tolerant or inclusive of alternatives.

Let us consider the thorniest and most divisive matter in the known history of mankind, namely religion. By definition, each religion/faith starts with the blind belief that only their version of the Creator and Creation is the "truth". By implication or divine instruction then, the followers of a given religion are to view all other religions as wrong and their followers as being misguided. This binary mindset of a believer irreconcilably bifurcates the humanity into fellow believers of the same "true" faith and the astray or the believers of other faiths and the people of no faith. This is precisely where religious intolerance is rooted and the process of blinding vision starts. This is because it is nearly impossible to accept or even see any merit in the view of another person believing that person to be absolutely wrong at the core. Importantly, it is not belief in the Creator, it is rather the imputed claim of exclusivity of a specific faith being the truth that procreates blinding vision and breeds intolerance.

Everyday thousands of children are born worldwide into families practicing numerous religions. And this has been going on for millions of years now. Clearly, to a believer, it is solely the Creator's decision as to what parental religion, if there is any, a child is born into. Then, it does not seem reasonable for the compassionate Creator to make truth seeking more burdensome for the newborns born into supposedly misguided parents. Stepping out of the binary mindset, however, leads to a more tenable and clearly harmonious premise that the divine messages to all religions at all times are, have always been and will always remain the same. The self-inculcated binary mindset of those believers who are "religious" about their religion prevents them from seeing this necessary logical commonality in all divine messages. What else could explain as to why the more "religious" people become about their faith, the more they litigate the untruth about others?

Arguably, the binary mindset with respect to religion has proven to be one of the most controversial influences in the governance of modern nation states. While a blanketing influence of religion is observed in some states, e.g., Saudi Arabia, Iran and Israel (de facto), the role of religion in state governance is primarily reflected in the ideological lenience of the political parties in most democracies. While occasionally parties with strong religious ideology do come to power (e.g., most recently in Egypt), the governance ideologies of mainstream parties in most democracies effectively differ in terms of the extent of secularism.

In practical terms, secularism as a state principle (enshrined in constitution or not) avoids legislating, implementing or adjudicating state policies that seek rationalization from or promote a specific religion or belief system including atheism. It is interesting to note that the ultra-secular people and parties (that subscribe to the highest degree of secularism) share an important characteristic with the religious right at the opposite end of the spectrum, namely a binary mindset. The binary mindset of the ultra-seculars views any accommodation of religion in public domain as an undesirable infiltration, meaning that religious guidance for governance can only be bad for the society. While the intolerant views of the religious right are overt, it is seldom recognized that often the ultra-seculars are quite intolerant of expression of religion in public sphere. For example, in USA and Canada, the ultra-seculars vigorously protest and sometimes litigate even the exhibition of religious replicas (like a Cross) or greetings (like Merry Christmas) in government buildings and venues. The intolerance of the ultra-seculars can and did (historically) reach extremes. Turkey once banned the wearing of hijab, and Egypt's religious right party, the Muslim Brotherhood, was banned as a political party for many years. In Bangladesh, even very recently, the ultra-seculars demanded banning of the parties with religious ideologies. In other words, while the religious right is "religious" about religion, the ultra-seculars are "religious" about non-religion, both being intolerant of each other.

The truth of the matter is that religion is an integral part of the life and values of many citizens, practicing or not. Hence a democratic society cannot afford to totally de-legitimize religion (of the majority) as a source of guidance for laws and public policies for too long without creating alienation, a sense of reverse discrimination and ultimately a backlash that might set back the secular progress over many decades. Similarly, it cannot also afford to govern its citizens into believing and practicing the divine codes of the majority without weakening the belief itself. This is because belief is a very personal voyage of our mind to explore divinity, ungoverned by human codes and unencumbered even by our own physique. Further, since belief is not observable and verifiable, enforcing the observable practices by way of governance risks increasing the incidence of fake observance that can degenerate into loss of belief altogether. Therefore, the key to simultaneously preserving the apparently competing but inherently congruous religious belief systems and the secular democratic societies that permit maximum attainable and most tolerant freedom of choice is to motivate the religious right and the ultra-seculars to break out of their binary mindsets. It is hoped that the above discussion is a small step toward convincing them that their respective corner solutions are too intolerant to be long term tenable and would ultimately sentence them to politically desolate corners.

While the impact of binary mindset is illustrated here using religion and secularism, the intolerance effect of a binary mindset arises in numerous other circumstances and dimensions of our lives. The more "religious" we are about anything, the more blinded and intolerant we become of competing views. Gradually but surely we, as individuals or as a collection, enter a phase of endless conflict with the "not-me" and "not-us" compartments of our fellow human beings. Life being a collection of countably finite moments, isn't it worthwhile to use those precious ticks to seek union instead?

Mo Chaudhury is a Professor of Practice in Finance at McGill University, Montreal, Canada.

Monday, 17 December 2012

Dynamics of violent activism

Mo Chaudhury

Dynamics of violent activism

December 17, 2012


Media reports have identified a number of individuals involved in the murder of Biswajit on December 09, 2012. The incident is inescapably egregious, but what is outright detestable is that the alleged murderers are supposedly activists of a fabled student organization, and their violent act was motivated by the presumption that Biswajit belonged to the opposition camp. This commentary critically explores the making of such nefarious political activism in today's Bangladesh.

Let us start with the demography of the alleged activists, the suppliers of murderous activism that claimed the life of Biswajit. All of these activists are likely in their early 20's, and hail from low to middle income families living in small localities far away from the capital. The non-descript parents of these non-metropolitan boys are shell-shocked by the incident as there was nothing in their upbringing that would prognosticate anything even close to their December 09, 2012 barbarism. Their inauspicious transformation likely started with their entry into the glitzy world of campus politics in the central theatre of the country, Dhaka. And their regimentation into campus turf wars perhaps commenced during the last few years of escalating antagonism between the major political alliances.

It is not yet exactly known why the Biswajit killers chose the career path of violent activism that culminated in the murder of Biswajit. Admittedly speculative, a likely scenario may nonetheless facilitate understanding of the dynamics of violent activism. It stands to reason that the lucrative and fast pace career in the business of politics lured the Biswajit killers into violent activism. The alternative world of normal studentship appeared to these young fellows as one of life long economic despair and stagnation in the social gutter of nobodies since they were at best mediocre students and could only enter public university programs with weak employment prospect (private university option beyond their means). Discarding this unpalatable choice, the Biswajit killers may have considered the non-violent career track of student politics, only to find that lacking charisma, with no established political connections and pedigree, and with no financial resources to sustain them for long in studentship, the odds of making it big are rather slim.

The Biswajit killers having now made the career choice of a violent activist, the choice of the party was rather rational. They quickly and correctly recognized that it is a matter of survival of the fittest in the political arena of today's Bangladesh as it is in a jungle. Given that the ruling party's influence peddling controls the entrance to and exits from all doors in Bangladesh, including the doors of justice and law enforcement, the fittest are those who pledge loyalty to the ruling party of the time and/or have ample resources (financial means, business and family connections) to purchase their favours. The young perpetrators had none of it, and the mere pledge of political loyalty would surely go unnoticed by the party hierarchy. Hence, the path of violent activism for the current or imminently prospective ruling party might have made most sense to these small-locale boys given their fervent desire to break through the glass ceiling with the fastest possible ascend.

The above explanation of the supply of violent activism is, however, incomplete and inadequate in explaining why the frequency and severity of violent activism was rather low compared to now during prior periods of political turbulence dating back to the mid 1970s. The answer lies in the evolution of demand for violent activism and the rapid rise in the financial dividends from influence peddling. Without a doubt, the clients of violent activism are the very political parties that are entrusted with the security of ordinary citizens through the democratic process. Quite ironically, it is largely the periods of more competitive democracy that have seen the frequency and severity of violent activism shooting up. In periods of no democracy, dictatorial democracy, or democracy dominated by a single party, the all powerful single camp controls the entire turf of winning elections if there is any, remaining in power, gaining and distributing financial and political resources, and sentencing any opposition at will. On the other hand, as democratic competition heats up, the margin of electoral (popular vote) victory becomes thinner, and any marginal edge in the control of the turfs becomes ever so consequential. With a long term upward trend in democratic processes and institutions, albeit with troughs and valleys, the intensifying political competition has increasingly drawn the political parties toward developing, nurturing and growing their own shadow armies of violent activists, popularly known as the cadres. When in power, cadres are used to thwart competition by terror and when in opposition they are used to instigate and enact violent protests. It is also worth noting that the emergence of two dominant political alliances in the new millennium has polarized and intensified the political competition even further and in the process has also elevated the demand for the services of violent activists.

The process of paying for the services of violent activists is well illustrated by the recent satirical commentary of Shahdin Malik in a local Bangla daily. Essentially the violent activists are rewarded by status upgrade within the party in an accelerated manner and by permission and protection to seek rents from ordinary citizens and businesses while in power. In time, violent activists often graduate from the street alleys to the hallways of the parliament, manage and lead the new crop of young cadres, and of course peddle influence, while in power, to reap handsome financial rewards. Further, the political parties provide a vigorous defence and/or cover-up of their misdeeds, most recently illustrated by the denial of the ruling party affiliation of the Biswajit killers (, December 10, 2012).

While supply and demand are necessary to explain violent activism, ultimately it is the financial dividend from governance power that makes the end to end business of politics a viable phenomenon in Bangladesh. This unholy business has taken a toll on the composition of the Parliament as well, tending to degenerate it into a "rich man's club" (p. 60, Rounaq Jahan and Inge Amendsen, 2012, The Parliament of Bangladesh: Representation and Accountability, CPD-CMI Working Paper 2). As incredible as it may sound, it is the miraculous pace of economic growth in Bangladesh that continues to boost the financial gains from governance power, the increasing gains also becoming necessary to sustain in opposition if and when needed. Alas, the ordinary citizens of Bangladesh, the Biswajits, have become unsuspecting victims of their collective economic success. Sadly, Biswajit's own hard work ended up powering the dynamics of violent activism that obliterated him.

To be sure, the people of Bangladesh are duly proud of a democratic and prosperous Bangladesh. But the fundamental building block of a civil and humane society is not its riches, it is not democracy either. Instead it is the rule of law that translates a hell of the survival of the fittest into a heaven of security for the weakest. The major political alliances, on their own, are not expected to become the protectors of law anytime soon. But if the history of Bangladesh repeats itself, both alliances have much to worry about in travelling along their law-as-we-like trajectories.

Mo Chaudhury is a Professor of Practice in Finance at McGill University, Montreal, Canada.

Tuesday, 11 December 2012

Law Enforcement in Bangladesh


Mo Chaudhury

Law enforcement in Bangladesh

December 11, 2012


The citizens of Bangladesh have much to celebrate in terms of cultural and linguistic freedom and miraculous achievements in terms of economic growth, literacy, health, education and diffusion of technology. But if ordinary Bangladeshis have been waiting for the cherished emancipation of mind (a la Robi Thakur) or sanctity of life and humanity (a la Nazrul Islam), unfortunately they just have to keep waiting. Meantime, their country is getting increasingly mired in the abyss of lawlessness in all forms, political and non-political crimes and violence, seething corruption, plunging morality, broken governance and self-serving politicking.

Is it possible to clean up such a gigantic mess? Yes, if only the Bangladeshis have the will to do so.

The four essential ingredients of law enforcement are: independence, resources, motivation, and (efficient) administration or management.

Independence: Absent the independence of the law enforcement agencies and the judiciary in all senses of the term, the ruling regime of any given time will legislate conveniently and enforce laws selectively to weed out opposition forces and to promote the interests of allies, and this will be done without judicial and law enforcement protection for the vast majority of citizens affected adversely and unjustly. Instead of bringing about this independence, ruling regimes in Bangladesh continue to exploit and abuse the lack of it.

Resources: Sufficient resources are necessary first for prevention and then for adjudication of unlawful acts. The size and strength of the law enforcement forces as well as strict and prompt adjudication of the unlawful acts are significant deterrents while offering worthy justice for the victims. Four types of resources are needed for this purpose: well-trained and sizable force of foot soldiers, capable managers/leaders, supporting physical infrastructure (arms, technology, facilities, vehicles, etc), and sufficient financial resources to fund the previous three.

What is sizable varies depending on the size of the population to be served, the geography of the land and the spatial distribution of the population mass, the current frequency, nature and severity of unlawful acts, and the targeted speed of improvement in the law and order situation. For Bangladesh, although a large and low income young population is its key resource base, this very critical and vast resource is widely exploited by political machineries and criminal gang leaders to outmuscle and/or sterilize law enforcement in committing a wide array of unlawful acts at the ground level. To deactivate and deter such practices, an unusually large, well-trained and well-equipped  law enforcement force is called for, given the gravity (kidnaps, murders, hijacking, torturing, controlling of strategic areas, institutions and processes, etc), the extent and the pervasiveness of unlawful acts. Dire circumstances call for drastic actions.

It is recommended that Bangladesh starts building a vast force of foot soldiers to reach a target of perhaps 100 law enforcement agents for every 1,000 residents. Very importantly, this force should be built wherever possible by attracting/drafting young members around the age of 18 to 30 years. Such a mega force will expedite the process of improvement (the speed of success will act as a significant deterrent as well) and turn the pool of recruits, the political apparatus and gangsters prey upon, against these very exploitative and infected organizations. Of course, this strategy will also generate much needed employment for millions of low income families.

The mega law enforcement force needs to be trained, equipped, inspired, directed, engaged and managed properly. Thus the complements of adequate physical infrastructure and managerial and leadership know-how will be vital. Further, the entire process of building and operating this force has to be as free as possible from political interference and influence. For these purposes, the building and operational leadership of the proposed mega force should perhaps be contracted out to an international consortium of countries with no participation from the immediate neighbourhood of Bangladesh. This will help procurement of donor financial resources needed to finance the venture as well as worldwide state of the art technology and know-how in law enforcement.

Motivation: Bangladeshis can ill afford to keep waiting for a motivational leader to lead the nation out of its severe moral decadence and beaten down governance. That leaves Bangladesh with non-inspirational motivation to work on. By and large this means the promise and delivery of a decent life for the foot soldiers and managers and their family members. Accordingly, the law enforcement forces need to be offered better than average economic benefits, educational and health benefits for the family members, social status via better job grades comparable to armed forces, employment security, career progress, and full force of protection of law and finance against powerful political and criminally engaged forces.

Administration: As the well-financed and well-equipped mega force start cranking the wheels of law and justice across the land, and as the transfer of foreign technology and operational management continues to flow in, it is only a matter of time that efficient indigenous administration will follow. While the public administration of Bangladesh has it share of governance problems, it is however an unproductive pastime at best to bash them for the widespread failures in law enforcement. They remain the solitary force of continuity in a nation marred by political upheavals and ceaseless turbulence, and they remain the apparatus of delivering services with so little resources and so little appreciation, financial or otherwise. For a better administration of law enforcement, transparency and accountability of public administration need to be enhanced, but the malignant practice of influence peddling by political regimes needs to be eradicated as well (M Chaudhury, How to establish clean governance, Financial Express, September 8, 2012).

To conclude, rule of law is of paramount importance to deliver the cherished land to the people of Bangladesh. This requires freeing the judiciary and law enforcement from the executive organs, and building a mega force of law enforcement that is well trained, resourced and motivated, and led by an efficient administration.

Mo Chaudhury is a professor of Practice in Finance at McGill University, Montreal, Canada.

Monday, 10 December 2012

Thoughts on RMG Factory Fires

Tuesday, December 11, 2012

Thoughts on factory fires

The recent tragic incident of factory fire in Ashulia has elevated long and widely held concerns about workplace safety in the RMG sector of Bangladesh. The purpose of this commentary is to explore the risks of such fatal events and how best to manage those risks.

Ashulia-like factory fires belong to the class of low frequency and high severity (LF-HS) operational risk events like earthquakes, hurricanes and terrorist attacks that can cause severe loss of life and damage to physical assets. They do not occur that commonly, but the consequences are fatal if and when they occur. In contrast, events such as mechanical failures, power outages, and work related injuries for individual workers are more commonplace but the consequences are not as severe.

Businesses typically manage operational risk in two principal manners. First, an operational risk control system is established to lower the chances of these events occurring in the first place and to reduce their potential severity. An operational risk committee oversees this process of measuring the risk on an ongoing basis, instituting physical measures and managerial action plans and controls, and monitoring the readiness and effectiveness of the overall risk control system. Second, since LF-HS events may still take place, businesses also purchase operational risk insurance to withstand such losses. Additionally, they often allocate and maintain operational risk capital as a buffer. The operational risk insurance and capital are funded solely by the business, and are different from work related compensation plans that cover contingencies (like accidental death or dismemberment) that are more commonplace, limited to one or at most a few employees in any one such event, and the employees typically contribute to such a plan.

Let us now review the Ashulia factory fire (AFF) from the above operational risk management perspective.

With more than 110 lives lost, the AFF is clearly one of the highest severity events in the worldwide RMG industry. According to Nilratan Halder (Financial Express, December 1, 2012), more than 200 people died over the last six years in Bangladesh and there were about 1,300 incidents in RMG factory fires. J. Ahmed and T. Hossain (Sri Lankan Journal of Management 14(1)) say that 263 people died in 9 RMG factory fires during 2001-2006. In contrast, factory fires are virtually non-existent in the RMG factories elsewhere including Vietnam and Nepal. Thus, the Bangladesh experience presents a lethal and uncommon combination of high frequency and high severity RMG factory fires. There is little doubt that this is primarily due to the lack of proper safety measures at the factories and the lax nature of enforcement of the mandatory safety standards by the government. In other words, prudent risk control, physical as well as managerial (RMG owners and related government agencies), is grossly inadequate.

While the nation and the families of the perished AFF workers grapple with the tragedy, the need for a national policy on operational risk control at RMG factories can hardly be overemphasised. A national policy should start with creating a National Operational Risk Board (NORB) with representation from the Parliament, related government ministries/agencies, RMG owners, foreign RMG clients, the RMG workforce, and home and foreign experts on operational risk management.

In addition to revisiting and resetting the proper safety standards, the NORB should set up the requirements of a mandatory operational risk control system at each RMG firm as well as at each factory that should be externally audited semi-annually if not quarterly by domestic and/or foreign firms qualified to do so. Much like the auditing of financial statements, no RMG firm or factory should be allowed to operate without due clearance from the external auditors as well as the NORB. NORB should also have a sub-committee responsible for developing and overseeing a plan of coordination and integration of the role and responsibilities of the pertinent government agencies including the areas of power, fire, water, labour, civil construction, roads and highways, health and medical services, and law enforcement.

While comprehensive and effective operational risk control is imperative in reducing the frequency and potential severity of factory fires, a fatal event like the AFF may still occur despite the best efforts. A principal concern in the aftermath of events like the AFF is adequate and immediate compensation for the families of the workers lost or injured. This purpose can be served well by the mandatory purchase of operational risk insurance and maintenance of a minimum amount of operational risk capital at the owner firms, both funded by the owner firm. To address moral hazard on the part of the owners, such operational risk insurance should have claim payout only to the families of workers (and not to the firm or its shareholders, creditors or clients) and the speedy disbursements of such funds should be overseen by the NORB.

To ensure compliance in this regard, forced reserving may be useful, whereby the Bangladesh Bank will withhold a sufficient amount of export revenue of an owner firm to pay for its operational risk insurance and to maintain the minimum operational risk capital. Since export revenues may be realised in creative ways, Bangladesh Bank should readily communicate to the NORB about any shortfall of required funds, and the NORB should then suspend the operations of a factory if the owner remains delinquent.

To conclude, as the nation grapples with the tragedy in the garment factory, it is important that a comprehensive national operational risk control policy and an operational risk insurance/capital programme are put in place as promptly as possible. This should lessen the exposure of the all important RMG sector to the high frequency high severity factory fires that continue to claim the lives of many workers, and could also materially hurt the vital export revenue due to client concerns about working conditions at the factories.

The writer is a Professor of Practice in Finance at McGill University, Montreal, Canada.