Thursday, June 30, 2005

The Importance of not being earnest

A quick follow-up to this morning's blog. Just thinking about it, it occured to me that it's not enough for the benefit you get from the other party to be greater than the benefit to person with next best fit. Given that this is a negotiation situation and that participation or non-participation is usually voluntary, if the other party knows what the value to you is, they may raise their price to equal the benefit anyway.

So T could set the price to A not equal to G(T,B) but equal to G(T,A) if T knows what G(T,A) is. In part, of course, this is solved by the mutual nature of the relationship - the synergy created is too important to both parties to try for such pricing (or in other words both parties think they're getting a good deal and don't bother). But it also makes a case for not letting the other party know exactly what their value to you is. Basically, A should show T that T's value to A is G(T,B) + d, where d (delta) < (G(T,A) - G (T,B)). That way even if T prices at benefit to A, not at next best alternative value (so C(T,A) = (G(T,B) +d)), A still stands to gain a net benefit equal to
G (T,A) - G(T,B) - d. In plain English, of course, this is called playing hard to get.

Just clarifying.

The Love Song of J Alfred Prufrock and Company, Investment Bankers.

Have you ever noticed how so many concepts in management and business can be applied to social / romantic relationships as well? This is true not only of the more sociological / psychological parts of management, which are clearly trying to explain human behaviour, but also of the more economic / financial side of business. And it's not just that you can stretch a concept to fit romantic relationships - if you really think about it, a proper application of business theory can actually offer fresh insights and provide a more structured way of thinking about these situations.
Take, for instance, the theory around successful M&A (which I've been reading a lot of recently). What follows is an extremely basic elaboration of some of the main points of this literature, except that everything included in it can be profitably applied (forgive the pun) to romantic relationships as well. Just try and spot the differences:
The Rationale behind M&A
Let's start with the most basic question of all. Why do people enter into mergers anyway? The literature provides a number of reasons:
Economies of Scale and Scope
The first reason for mergers comes from the existence of scale-free assets and asset indivisibilities. As a result, the marginal cost of applying these assets to another person is low, so that greater efficiency and return on investment can be achieved by merging with another person. (As an example, think about being well-read as an asset. You can't be slightly well-read - there's a certain minimum scale of reading you have to do. At the same time, once you are well-read, there's very little effort that goes into sharing that with one additional person). The old chestnut about how if you share your happiness you double it is actually true - if you spread a fixed resource over twice the number of units (without any additional cost) - you get twice the profit.
Mergers may also create possibilities for division of labour and specialisation of capabilities. It's not just that the resulting entity possesses the best of both worlds - it's also that each party has now greater scope to specialise in the things they're truly good at, so that the overall performance is better. Also, to the extent that the two parties are in the same or similar businesses (have the same or similar tastes) mergers may allow for the sharing of certain basic administrative costs (rent, music, books, etc.) and may create efficiencies by eliminating duplication of effort (you don't both need to send Christmas cards, for instance).
Market Power
A second important source of value from mergers is the increase in market power that both parties experience. As a joint entity, the merged parties are able to better coordinate their demands / offerings and therefore have a greater ability to bully suppliers and may be able to make better deals with consumers, effectively charging them higher prices. (Anyone who's ever tried having dinner alone with a married couple has probably felt this - that sense of being ganged up on, the way one person will always hang around to keep you 'entertained').
Risk Mitigation
A third source of value from a merger is the almost purely financial one of creating a lower risk portfolio. The basic idea here is that to the extent that both parties will not experience distress together, the distress of one can be supported by the other, so that the overall entity has a more stable earnings / benefit profile. Thus, even though the actual cash flows (happiness flows) of each party may remain the same (or may even decline somewhat because of rigidities created by the merger), the overall value of the party is higher because greater stability of cash flows means that discount rates on future cash flows are lower. (Notice that this assumes that risk is not completely covariant, in which case there would be no benefit. Notice also that this is only a valid reason when financial markets are inefficient - if we could simply invest in each other's happiness without getting together, we could achieve the same portfolio effect without getting into romantic relationships. In some ways that's what friendships are for - and you thought it was coincidence that it was called the bond market!)
Restructuring and momentum for change
A fourth argument made for benefits from M&A is the possibility of restructuring - change in management can create opportunities for superior performance through innovation and fresh thinking. In fact, the acquiring party may often enter the acquisition purely because he / she sees the opportunity to fundamentally remake the target in order to dramatically increase profitability. This is the classic Pygmalion story, of course, but it is also the logic of getting together with someone out of sympathy and with the hope of making their life better. In some ways, of course, this is just a special case of the capabilities / specialisation argument - the strategy only works to extent that the acquirer has superior talent / insight and can do better by applying these to the other party than internal to itself.
There are also, of course, disincentives to mergers. First, mergers tend to reduce focus and the removal of investment decisions from the market may lead to sub-optimal investments and the toleration of inefficiencies that would otherwise not be allowed (this leads to the famous diversification discount). Second, mergers are highly disruptive acts - not only do both parties incur fairly high short run adjustment and transaction costs, rigidities and coordination problems imposed by the merger may actually cause each party's growth to slow or even stop entirely.
The efficient market problem and why mergers may work
A fundamental problem underlying all the reasons for mergers given so far is that we have not, so far, taken into account the problem of valuation. Economic theory tells us that in the presence of efficient markets, the valuation of each party to the transaction (and therefore the cost paid by the counterparty) should exactly represent the value realisable by the party from the transaction. If this is true, then all mergers would be value neutral transactions, and as such there would be no point getting into them.
In the presence of heterogeneity of participants, however, this theorem is not strictly true. To see why not, let us consider the potential of merger between two parties - say A and T. Let us assume that A is considering two potential counterparties: S and T while T in turn is considering two partners: A & B. Let us further define a function G(X,Y) as being the value to Y of a partnership with X and C(X,Y) as being the cost to Y of a partnership with X.
For the partnership to work, it must be true that
G(A,T) > = C(A,T) and G(T,A) >= C(T,A) - otherwise one or the other party will not agree to participate (strictly speaking the relationship should be positive - if either relation is equal, then the party is indifferent between entering the partnership or not entering the partnership)
Assuming markets are efficient, and that B and S are the next best alternatives to A and T respectively, we can infer that:
C(A,T)> = G(A,S) and C(T,A) >=G(T,B), since any bid lower than this would be matched by a competitor in the market.
It follows that, for a successful merger:
G(A,T) >= G(A,S) and G(T,A) > = G(T,B)
That is to say, both parties must hope to get some unique value from the other party, value they could not get elsewhere.
Before we look into critiques of this model, there are two issues we need to address:
First, it's important to notice the importance of heterogeneity in this system. If all participants were identical then there would be an equal value from partnerships with any other party, but the value of all these partnerships would be zero. As the heterogeneity of participants increases, the potential benefit from a transaction also goes up, but so does the potential cost of excluding any party from your consideration set. (This actually leads to an interesting discussion on probability distributions and the importance of sampling frames, but let's come back to that in a later post). Notice that this is not specific to mergers alone, but is in fact, the very basis of scarcity rent.
The second issue is of course the need for non-market transactions. After all, even if these benefits exist, why can they not simply be realised through trade on the open market rather than requiring a close integration of the two parties? A first answer to that question comes from Transaction Cost theory. While the implications of TCE for relationships are too manifold and interesting to cover in detail here (sigh! another post waiting to happen) the basic intution is that in the presence of incomplete contracts (given the impossibility of defining every future situation in full detail) the creation of specialised assets creates opportunistic hazards - given that specialised relationships, once created, cannot be traded on the market, there is the potential for hold-up - for the party benefiting from these relationships to pay significantly less now that you're in the relationship than he would have had to pay to get you to agree to enter the relationship in the first place. Hence the need for internalisation of the transaction. A second answer, comes from the tacit and uncodified nature of knowledge / capabilities, which essentially means that you cannot simply pass on what you know to the other party but have to interact with them over an extended period of time to make the transfer possible.
Deviations from market efficiency
If you think about the model outlined above, you would think that it would be extremely difficult to arrive at a merger proposal that both parties would agree to. You would basically have to find two parties who both valued what the other had and couldn't get it from anywhere else. In a truly efficient market with full information, this would be hard (or looked at another way, it would be easy. Basically you could get the same benefits by paying for them at cost on the open market - there would be little or no incentive to get into mergers)
Why then do so many mergers actually take place? There are a number of deviations from the model that must be considered:
Endogeneity of benefits
The first problem with the model is that it assumes that all value from the merger derives from the combination of resources of the two parties - that being in a merger per se has no value. This may not be true. The basic effect here is isomorphism - the tendency, over time, of participants in the same market to come to resemble each other. If all participants around you are merging, this may lead to feelings of doubt or inadequacy, and may prompt you to merge even if it's not really in your best interest. Part of this could be oligopolistic reaction - in a highly competitive market, you would want to maintain absolute parity with those you consider your peers. Even if you saw no real value in a merger, you may still enter into one if your peers do, simply so as not to risk being left behind (of course, this is a risk averse strategy - you could also choose not to merge in the expectation that this will lead to higher returns, but that would be a lot riskier). At the same time, mergers may be an important signalling mechanism, sending the message to the market that you are a viable and high performing entity. Third, the market, in the throes of a bubble or a merger wave may react illogically to merger activity, causing your stock to go up even though there are no underlying fundamentals to justify this.
Of course, if the benefit from entering into a merger were the same for all parties then it would simply cancel itself out. It's only if the merger value is different (some parties are more desperate to merge than others) that this can have an influence on merger valuation, with parties that value mergers for the sake of merger per se being willing to bid higher and therefore enter more easily into mergers than those who value mergers based purely on fundamentals. At the extreme of this case is a scenario where one party simply wants to exit the market and will basically sell out even at a loss.
Imperfect information / markets
A second problem, of course, is that markets are often far from perfect. First, all relevant parties may not participate in the market, or information about them may not be readily available at any one time. Given that it's often difficult to know if / whether a potential counterparty is looking for a merger (except through informal sources / hearsay or through the observation of explicit moves in the past) the best one can hope to do is pick a consideration set of likely candidates, but this may often mean leaving out high potential candidates who escape our attention.
Second, full information about parties even in one's consideration set is notoriously hard to come by. Even if basic factual information about their current status is available, knowledge of their future plans and strategies is almost always impossible to get. Moreover assessments of their skills / capabilities may be largely anecdotal, and it may be difficult to get full access to them without entering into the relationship. All of this means that predicting future returns from the partnership is more of an art than a science, and valuations of the same counterparty can be subject to considerable standard error, making for a range of value. It is this uncertainty that leads many parties to get into mergers with expected values that are frequently not realised.
Common medium of exchange
Another problem, though one perhaps less important in purely financial transactions, is the question of the medium of exchange. As long as the deal is made purely in money, of course, this is not an issue. But as soon as other issues of control and governance play into the picture, we encounter the problem of different parties ascribing different values to the same thing. The result is that a common solution may actually be easier to reach because each party can be given more of what they value. In some ways this is the same thing as the argument in the model - it's just important to note that the differences in value may be entirely perceptual rather than having basis in any objective fact.
Obtaining Value from M&A
Given this background, we are now finally in a position to consider what leads to generation of value in a merger. This is an important question that has been the subject of much research, simply because it is an observed fact that in most cases mergers that start with much fanfare end up creating very little value for their respective shareholders.
Related vs unrelated mergers - Strategic Fit
A first consideration is of course the question of how the two parties are related. Received theory (backed by some empirical evidence, though the findings are mixed) suggests that mergers between related parties (i.e. parties with some common interests - markets, products, etc. ) perform better than those between unrelated parties (e.g. conglomerates). This is essentially because the value of economies and market power are much higher when the two parties are related, while in the case of unrelated mergers the chief benefit is only risk reduction, which could conceivably be achieved through market transactions anyway. That said, it would seem that mergers between identical parties may produce less value than those between parties that bring somewhat different but related (complementary / supplementary) assets to the table. While there is some evidence of this, it is unclear whether we can safely conclude this to be true.
Organisational fit
While the question of broad interests and assets and their relatedness is clearly an important one, there is a second issue that is of critical importance, and that is more often overlooked by managers. This is the problem of organisational fit. Even though two parties may be aligned on overall objectives, interests, etc. they may have fundamentally different work-styles / cultures / routines and may take very different approaches to getting things done. To the extent that the value of the merger lies in a close integration of the activities of these parties, we may find that in the absence of this more day to day fit, deals that look very good on paper may prove to be completely impossible to make work on the ground. Understanding and assessing differences on these important day to day dimensions is therefore critical to merger performance
The effect of size
A third finding much touted in the literature is the effect of size - in general, studies of acquisition have found a disproportionate amount of the value creation going to the target rather than to the acquirer. One reason for this is that the acquirer (or the dominant partner) is usually larger and more successful, so that the value added by the new partners has little effect on its overall profitability. A second reason may be that given that targets are often required to completely forsake their own identity in being acquired, the market may give them greater bargaining power to start with, allowing them to demand a higher up-front price (and giving them a greater range of potential partners to evaluate and reject) than the acquirer. That is why short-run studies of mergers may show the target enjoying a much higher return, not taking into account the final annhilation of the target's identity.
Process issues
Researchers have also pointed to a number of process issues that may lead to subsequent failure of mergers:
First, there is the problem of fragmented focus - which means that decision makers may prioritise a few highly salient features of the relationship (typically things they lack and may not be able to get easily on the open market; like sex, for instance) without paying sufficient attention to the overall picture and thinking through the integration challenges at all levels. The result is that the merger goes through, but then does not yield the hoped for results, because problems in other overlooked areas persist.
Second, there is the notion of escalation of commitment. Once parties have initially entered into a negotiation, there is a tendency to distort negative information received, and a set of perverse incentives to close the deal prematurely and without due evaluation. Part of the reaons for this is that parties feel that their own judgement and reputation is at stake and so are unwilling to admit to having made a mistake. Another part of the problem is that negotiations are high stress, disruptive situations, causing parties to seek early closure. Finally, there is key role played by third parties to the transaction (investment bankers, consultants, that annoying aunt who - knowing nothing about you - is always tell your parents how you should live your life) whose interests are often aligned behind making the transaction happen rather than around the participants' subsequent performance. These parties exert pressure for early closure.
A third issue is the problem of ambiguity - by its very nature, negotiation implies incomplete disclosure. Parties will both try to hide negative facts about themselves (in order to keep their valuation high) and not disclose their real plans for the other party (in order to keep valuation low / avoid pre-deal conflict). This ambiguity creates problems in the post-merger situation, when the unexpected truth is revealed and becomes the focus for much internal conflict within the new entity.
A fourth issue from the process side is managerial arrogance and mismanagement. In the aftermath of the merger, each party may feel that they are in a position to help and improve the other parties situation, without really understanding the full dynamics of the other side. Therefore they may try (either well-meaningly or out of hubris) to take steps to 'help' the other side which may not be appreciated and may lead to conflict.
The importance of prior experience - how to make mergers work
What then leads to a good merger? One important factor is the prior experience of the merging / acquiring parties. To the extent that parties have been involved in mergers before and have been able to codify and learn from their experiences there, they will be in a better position to manage this new merger more effectively, avoiding some of the mistakes listed above. Beyond this, sensitivity to the other party, willingness to learn, and an objective evaluation of both the big picture and of day to day fit before getting into a merger are important determinants of merger success.
Another issue to think about in achieving value from mergers is the optimal level of integration required. In many cases, full integration may not be the best solution for the two parties - it may be better to achieve some sort of basic / partial integration and then let both parties develop independently, without binding them together to a point where it becomes constraining.
See what I mean?

Tuesday, June 28, 2005

Auden Poem: The History of Truth

This is the poem referred to in the last post:

The History of Truth

In that ago when being was believing
Truth was the most of many credibles
More first, more always, than a bat-winged lion,
A fish-tailed dog or eagle-headed fish,
The least like mortals, doubted by their deaths.

Truth was their model as they strove to build
A world of lasting objects to believe in,
Without believing earthenware and legend,
Archway and song, were truthful or untruthful:
The Truth was there already to be true.

This while when, practical like paper dishes,
Truth is convertible to kilo-watts,
Our last to do by is an anti-model,
Some untruth anyone can give the lie to,
A nothing no one need believe is there.

-W. H. Auden

Monday, June 27, 2005

Why do we need God?

Sigh! just realised that this blog is rapidly becoming a little more serious than I intended it to be. Oh well, figure we might as well get all this God business out of the way in the first week, so that we can start to focus on the really big questions - like what's for lunch.
Comments on my last blog led logically to the question - why do we need God anyway? A first answer to that is that social bad habits are hard to kick (just look at the number of people who still smoke, and bibles don't come with a Surgeon General's warning printed in bold red letters at the back - more's the pity) and if you come right down to it, why do we really need anything (except coffee, of course; and chocolate; and maybe vodka?).
As a self-respecting PhD student however (hey, someone has to respect me!) I can't let it rest at that. So here's my two-bits worth of theorising on the need for God.
The child's need for God
Let's begin by looking more closely at the psychological underpinnings of the desire for God (or what passes for psychology in my world - I'm not going to get into Freudian analysis about how God is just a personification of castration anxiety for men and a sort of spiritual penis for women - even though it does make you think about the Shiva Ling a bit). I believe there are two fundamentally different (and almost opposing) sources of the need for God.
The first, and more common need, arises out of what I call the child mentality. This is escapism, the impulse to flee the complexities of the world, the nostalgia for the simple world we all knew as children, and the desire to have someone else make decisions for us. This impulse - to cede control and be mastered by another - is one that I believe to be fundamental to all forms of human interaction and is therefore not purely religious. Even the most controlling of us have desired that mysterious someone who will make our decisions for us, who will tell us what to do - this is true in love, at work and in other social settings.
Where does this impulse come from? To begin with, as I suggest earlier, it is a throwback to childhood - a desire to return to the safety of the womb (and you thought all that "Our Father who art in heaven" stuff was just coincidence). Second, it is a consequence of the bounds to human rationality (what was it Eliot said, "Humankind cannot bear very much reality"), and the fatigue this implies. It is, after all, exhausting to have to think through all the decisions that make up the (supposedly) simple act of living, so it's not surprising that we would want someone to make at least some of those decisions for us (if there's one benefit I see to being married, it's that I can get someone else to go shop for clothes for me). Not, of course, that we want someone to run our lives entirely (more on determinism in some later post) just that it would be nice to have some limits. If everything is permitted, then the world is truly a frightening and vertiginous place (as Dostoyevsky so vividly shows us in Crime and Punishment).
Closely linked to this is the notion of God as scapegoat. God is not simply a source of hope for the child mentality, he is also a convenient alibi for everything that goes wrong with us or with the world around us (did anyone else do this silly little verse called Mr. Nobody in school?). Think how crushing the weight would be if we had to accept responsibility for all our faults, all our misfortunes (and not just ours mind, but even, in some part, the world's). Instead, we can happily blame it on God. Lost your job / business went bankrupt? It's not because you're a snivelling moron, it's because you didn't offer the right prayers. Can't have children? It could only be because the Gods are angry with you. Too lazy or slow to do anything to better your lot? These things must be sent to try us. At the extreme, a belief in God implies a complete abdication of all responsibility (notice that this need not apply simply to passive events - God can also help you dodge responsibility for the most brutal, sadistic and heinous crimes).
Linked to all this is the human need to be loved (or at least to be noticed). In some ways God is an ever-present audience - it's nice to think that somebody cares about what you're doing with your life, that you're the star of your own Truman show, even if God is the only demographic that watches. This is especially true of people who either live alone or feel themselves unloved (hence the tendency for hermits to become religious - though why someone with all of God's responsibilities should spend time listening to some stupid hermit is beyond me - probably all he needs is a good assistant and a Palm and we'll have no more of this. I've always wondered for instance, what the logic of giving fabulous weapons to people who did penance in the Hindu myths was. I mean, it's like you just spent some twenty of the best years of your life standing on top of some lonely mountain freezing your balls of because some mumbling old guru told you it might help, your fingers are about to fall off from frostbite, it's going to be years before you can fully turn your neck again, so obviously you're the right person to trust an all-powerful world destroying weapon to. Can you imagine if they did that today? What, you attended every single concert of the latest BeeGees tour? Here's your ICBM.)
Personally, I've never understood why people would want unconditional love. Frankly, if someone is loving me, I'd rather it was for who I was than on some general principle. What's so special about being loved by someone who would love pretty much anyone. It's like saying - I love you, but if you were an illiterate axe-murderer with bad breath and a penchant for latino music, I'd love you just the same. Who needs that? If I'm being loved, it should be by someone discriminating enough to really appreciate me. That's what makes it special.
Still, you can see how it could be comforting for some people to know that there's someone out there who'll at least pay attention to them, if not actively care for them and forgive them and all that jazz (why love, anyway? if there really is a God let him not love me, let him just do my tax returns)
The Thinker's need for God
So much for the child's impulse to believe in God. There is also, I think, a second and somewhat opposed psychological drive that leads us to God - this is the drive to find reason in everything. From an evolutionary perspective, this is the drive that makes us the dominant species on the planet (well, except for the dolphins; and the mice) - our ability to see cause and effect. The trouble with this, of course, is that we've managed to convince ourselves that there must be a reason for everything. It follows that sooner or later we had to start thinking about the meaning of our own existence (you can see it now can't you? the neanderthal classroom - the smart alec student who raises his hand and says in his most innocent voice "But sir, if there's a reason to everything than what's the reason for life?", then sitting there smirking and figuring now he'll get that cute cavegirl who sits three flat rocks ahead to go to the prom with him for sure until the teacher gets so infuriated with his questions that he sends him to meet the saber-tooth - corporal punishments were a lot harder in those days).
Why does God need to come into it though - precisely because he's the least abstract starting point for beginning to solve that problem. Imagine that there's a whole bunch of stuff that you don't understand about the world. Imagine that you haven't really got to the point where language or logic is capable of dealing with true abstraction. How do you begin to think about the problem of the unknown? You come up with a mythical being and try to figure out what he must be thinking if he's behind all this. Then, when that proves too hard, you make up a whole set of mythical beings. Or, if you're sophisticated enough to handle this, you come up with the idea of a mythical being so complicated that you can't understand him (thereby going back to square one, of course, but that's okay - you're SOPHISTICATED now).
Notice that in this interpretation God is just a bad habit of thought that we haven't been able to shake off - a frame that we adopted once to think about a problem that didn't work, but now we can't seem to get rid of the idea.
Why doesn't God work? Precisely because the world is too random and inconsistent for us to be able to find any rational pattern in it that we could truly call God. So we either end up with a God we don't understand or with a whole host of gods, each one of whom we understand (kind of) but whose combined actions we can't predict. Think of God as a regression equation on a set of data that's pure noise and you get the idea.
If this is true, then why do we continue to stick with the habit of thinking in terms of God? Partly because even if we don't understand him, our hypothetical God does at least give us a starting point for thought - it limits the solution to a deterministic non-arbitrary space, which is more than we could achieve otherwise (this is how God is different from the unknown / the supernatural - God is a thinking being and therefore more accessible to thought). In the extreme case, of course, we could believe that God was fair and just and compassionate (and this, if we could believe it, would be a blessing in itself - but the self-delusion required may be too much for most people) but even where God is petty and intensely human (such as with the Greek gods), a human mind is still easier to think in terms of than pure chaos (the supreme irony of all is that it's the world that created God out of chaos, not the other way around). This means that there is at least the mirage of a solution, and a definite problem that people can now spend their lives working on (I'm reminded of Hesse's Glass Bead Game - which is the archetype of what the thinking man really needs - a game that has no real meaning or significance, but whose complex world takes up all his ingenuity and skill; Hesse explicity disassociates the Game from Religion, of course, but I think there is a religious impulse that is very similar to that of the Game).
To summarise then, from a pyschological perspective God is either a way of ignoring the complexity of the world by creating a convenient scape-goat and accepting a set of dogma (in some sense also a name given to what we don't know so that we can stop thinking about it) or a frame by which the fundamental randomness of the world can be analysed.
This is how men of science can continue to believe in God - science may fulfill their thinker's need, but the child in them still needs God. Notice that the two drives, though somewhat opposed can (and I believe almost always do) exist together in one person. In fact, it's not as though the difference is so clear - at the limit, the mind is agile enough to believe in something and also know that it's a myth that it believes in (what was it Ghalib said: "Humko maloom hai jannat ki hakikat lekin / Dil ke khush rakhne ko Ghalib khayal accha hai")
Society's need for God
But the need for God is not entirely psychological either. There is also a social need for God - a sense in which God (or to be more exact religion) is an institution that helps define and shape society. Durkheim is instructive here - it is not the content of religion that helps keep society together, it is simply the energy that the questioning of religion generates, the sense of being threatened that pulls people closer together, that makes religion critical to society. It follows that if norms are valued not for their content but for their popularity (rather like Madonna albums) then it doesn't matter how outdated or illogical they are as long as they serve as a basis for social interaction. This, I think, is one of the key reasons why religion has survived as long as it has. It's also the reason why religious groupings tend to be so intolerant. Supporters of religion will tell you that most religions actually preach tolerance and brotherhood; this may be (though I'm somewhat sceptical) but the point is that the content of religion is irrelevant anyway, it's only the sense of differentiation it creates that matters - and intolerance is fundamental to this purpose.
This is also the reason why we are so weary of evaluating and choosing religions too closely. After all, there are many different things that people habitually disagree on (Swift's Little Endians and Big Endians come to mind) but you don't find people killing each other in the streets over whether chocolate chip icecream is better than strawberry (not that people who would choose strawberry over chocolate chip can be properly considered human, of course). Yet these could easily be thought of as defining identity as much as religion (and more practically so, I'll willingly eat with anyone from a different religion, but going to the house of someone who likes fruit flavours in icecream is really putting my immortal soul in jeopardy). The difference, I maintain, is that we are socialised to see icecream flavours as a choice we make in the real sense of the term. I mean it's not like your parents will be dismayed if you suddenly convert from mint chocolate chip to coffee chocolate fudge - saying, son, you've let us down, we had such hopes for you, where did we go wrong?! But religion is something we're socialised into being far more rigid about (of course people convert, but it's supposed to be a big deal). The result is that rather than choose an identity we really like and consider superior, we now have a classification thrust upon us and are forced to prove it superior. If the colour of clothes you could wear was decided by the day you were born, I'm pretty sure you would have colour wars right now - with those who were forced to wear pink every day, for instance, trying to achieve world domination just to prove that there's nothing wrong with them.
I said earlier, that the content of religions has no bearing on the social need for it, but this isn't entirely true. The second reason I think religion is important is because it provides a neat short-hand way of explaining complex social organisation to people with the IQs of a five year old (i.e. half the world). Consider, for instance, the question - why is it wrong to kill another human being? If you really want to explain this to someone logically you need to go through a fairly complex argument starting with the premise that human life per se is valuable and then running through (I imagine) Kant and Hobbes to explain the underlying logic of the social contract. Instead, it's easier to just say - look, it's wrong because God says so, okay. Again, this is the way grown-ups explain things to children, but the fact is that the bulk of humanity is too stupid to have things explained to them any other way. Religious dogma thus becomes a useful underpinning for practical, sensible laws.
The Need for God
So, do we really need God? My argument is that we don't, but that he may just be convenient. Basically, if we want to substitute God there's no one thing that will do the trick. Science and philosophy can fulfill the thinker's need for God (and in many cases already has); laws and national identities can serve the same purpose as religion in establishing social order (though these are not without their own perils); and the child's need for God may, perhaps, be served through Art and Feeling.
What do I mean by this? I mean simply that Art has tremendous power to convey the same sense of empathy and unconditional love that people currently find in God (that's why listening to Beethoven is a fundamentally religious experience) and if we gave more credit to our feelings and intutions we may need to rely less on some artificial arbiter of our destiny. In other words, we could let instinct cut down our options instead of relying on God / norms to do it. We just need to trust our feelings enough.
That said, it's obvious that this is a clunkier and more difficult solution. It follows therefore that for the foreseeable future, we may still need to keep God around, as a sort of convenience - a utility rather like electricity.
There's an awesome W H Auden poem - I quote from memory:
"In that ago when being was believing
Truth was the most of many credibles
More first, more always, than a bat winged lion,
Or an eagle-headed fish
More than mortals
Doubted by their deaths.
This while when
Disposable as paper dishes
Truth is convertible to kilo-watts..."
Will try and find the full quote - but the point is that you only have to substitute God for Truth and you have the gist of everything I've just said (why do I bother?)
Meanwhile, of course, I must start talking about something else on this blog. Will do that soon (provided of course I don't get struck down by lightning in the next 24 hours. If that happens, I may not be able to post anything more. I understand hell has firewalls.)

Sunday, June 26, 2005

Is God power hungry?

Just a quick follow up to yesteday's post. One reader (I have readers! Yaaay!) wrote in to say that he thought I was being overly cynical in portraying God as power hungry.

I don't think so. At some level, the very idea of belief being necessary is one that rests on the idea of God wanting, or rather, needing power. If there really is a God (an idea I'm far from convinced of btw - how's that for being cynical!), then why does it matter to him* whether people believe in him or not. If you were an all powerful, all-seeing being would you sit sullenly sulking in a corner, saying "I'll help you, but first you have to say that you believe in me"? If God were truly compassionate, then he would logically help everyone equally, independent of whether they believed in him or not.

Understand I'm not saying that God should be good to everyone (since at some level good is relative anyway) - I'm only saying that people should be judged (if they are judged at all) on their actions rather than on whether or not they happen to believe in one particular deity. So, take for instance, the issue of the death of unbaptised infants. How self-centred and small minded would you have to be to deny these little ones a place in heaven (always assuming there is such a place) just because their parents happened to be too busy planting paddy or getting their taxes done or attending their pilates sessions to get around to having some water poured over their child's head? Or alternatively, consider Dante's Inferno**, where the first circle of Hell is reserved for pagans who died without knowing Christ. This is a circle peopled by such great men as Virgil, Horace and Ovid (and presumably by Homer, Sophocles, Socrates, Aristotle, Plato, etc.) - who belong in Hell only because they were never baptised and never accepted Christ. The fact that Christ hadn't been born when these men lived is clearly not relevant.

Who would deny such men a place in Heaven? Who would be so churlish, such a bully? Only someone who was incredibly insecure - someone who was afraid that he would cease to exist if people stopped believing in him, that he would somehow lose his supremacy if the majority of people did not constantly worship him. The difference between such a God and a truly compassionate being is the difference between a pop star and a true artist - this is a God who is more concerned with TRPs than with human suffering. The God of the Old Testament, we are told, is a Jealous God, but jealousy implies a desire to covet, a hunger - and what can God hunger for except for power (and maybe the occassional pizza. Think what Christ could do with anchovies - one small fish and you have toppings for everyone.)?

You could argue, of course, that God needs belief to survive and therefore his desire for it is justified. There are two problems with this - one, if God truly had faith in his own abilities, then surely he would be confident that he had only to help people as best as he could and they would believe in him. The true artist does not need to pander to the crowd - he plays what his heart tells him and the people listen and are moved. The second problem is that even if God really needed belief to survive, how can you call a being compassionate when he prioritises his own survival over the welfare of his charges. If everything God (presumably) does is paid for by our belief in him, then he is surely little better than a service provider, a self-interested and rational economic actor (and presumably, soon to be outsourced to a call centre in Gurgaon).

Therefore, I don't think it's cynical to see God as power hungry - the fact that he demands belief makes him so. In fact, if you believe that he is all powerful to start with, then it makes him worse - it makes him a psychotic megalomaniac. Consider, for instance, the story of Rahab from the book of Joshua. When the Isrealites attack her city, Rahab is the only one whose life is spared, because she is the one who gives shelter to the spies of Israel and helps them destroy the very city she has been calling her home. This is treason; but in the eyes of the Old Testament God it is excusable because it is treason done in his name! (As a matter of fact, the entire book of Joshua is practically a creed for terrorists - the basic idea being that if you believe in the true God then you can go around slaughtering all your enemies and committing all sorts of henious acts, and as long as you're doing this in the name of religion, your God won't just let you get away with it, he'll actually help!!). For all the fuss made over (and scorn heaped on) Vidkun Quisling - there's actually biblical precedent for what he did!

One final point: understand that I'm not necessarily arguing that there's anything wrong with being power hungry (though you have to worry a little bit if the being hungry for power is supposed to be all-powerful to begin with); in some ways, to recognise that God is power hungry is to be able to establish a cleaner relationship with him (which I guess is the point of monotheism anyway). Think of it as any other career decision - would you want to work for a boss who was incredibly driven, highly ambitious, and would do pretty much anything (like murder his son, for instance) in order to get ahead (following the Christian God is almost like joining the Mob - I personally have always thought of God as being a sort of Don Corleone, only on a slightly larger scale - and don't even get me started on the significance of the twelve families all coming from the same place)? For some people, the answer to that question may well be yes - in which case this is the right God for them. Just as long as we're not kidding ourselves with the notion of some gentle, benign presence who watches over us with compassion and mercy. That's just the stuff they tell you before they shake you down for protection money.

* Throughout this post I refer to God as him - this is just a matter of convention. I see no reason why God could not be a woman (it might even explain why Mary was still a Virgin afterwards) - in fact, on the whole, I'd be happier if She was. (my biggest fear about heaven is that I'll make it there and it'll be a place where everyone sits around in front of this giant TV screen drinking beer and watching baseball; and there won't even be coasters)

** Of course, Dante is not exactly scripture, even though IMHO he's far more worthy of worship. Still, I don't seem to remember any Church strenously objecting to his interpretation of Hell.

Saturday, June 25, 2005

What in the name of Jesus

Variations on the Passion of Christ

If the mark of a great myth is the number of different writers and thinkers who have offered varying interpretations of it, then the story of the Passion of Christ must rank as one of the most fruitful of all stories ever told. It's not just that the Passion has been the subject of some truly exquisite art, though it has, of course. Starting from the different versions of the tale in the New Testament itself, and taking in the wonderful settings of the Passion according to Matthew and John by Johann Sebastian Bach, the innumerable number of painters who have inspired by the scenes from the New Testament, the many cinematic versions (of which Mel Gibson's execrable movie is but the latest version; see, for instance, Scorsese's Last Temptation of Christ) and the sheer number of short stories and novels written about the Passion (all the way from Chekhov to Borges), the Passion has long fascinated artists and thinkers of all times and talents.

Part of this, is, of course, the vagueness of the whole thing. Unlike the Old Testament, where the meaning of the text is often clearly spelled out (what other religion will offer you ten basic rules in bullet-point format?), the New Testament is filled with opaque, often contradictory parables, the meaning of which (it seems to me) is left largely open to the reader. What exactly is the Passion of Christ? What does her martyrdom consist of? What does it achieve? What are we to take away from it?

Before I get into my own theory on the matter (which is, after all, the point of this blog) let me highlight some other interpretations I find fascinating. Perhaps the most interesting (if only because the most fanciful) of all comes from a Borges short story, where Borges argues that it is not Jesus but Judas who is the true Messiah - it is Judas who truly suffers, being driven by his own demons to hang himself, and (presumably) being damned forever. Yet isn't Judas's betrayal necessary for the martyrdom and eventual glorification of Jesus? And if this interpretation is true, doesn't Judas suffer further in being misunderstood forever by the very people he died to save; and isn't that misunderstanding a part of the conspiracy?

Scorsese's Last Temptation of Christ (based on the novel of the same name) takes somewhat the same point of view - at one point in the movie, Jesus (played brilliantly by William Defoe) points out that Judas (Harvey Keitel) has the harder part to play, because he has to betray a loved one, while Jesus has only to die. (The movie, which starts with incredible promise, then proceeds to lose it's way in some fairy tale about Jesus being offered the chance of living a normal life and having to refuse it and choose the death on the cross instead, in order for his martyrdom to work; this is interesting, but a trifle trite)

While I'm unconvinced about this interpretation, I think it highlights the central problem with the Jesus myth - how is it possible that the finite suffering of one man (even a semi-divine man) at one particular point of time is enough to pay for all of the sins of the world forever? Especially when this suffering consists of a few brief hours of pain with the certainty of salvation and rebirth and the joys of heaven afterwards? The idea of Judas as Messiah does away with this problem by arguing effectively that it is Judas who has been suffering (and will continue to suffer eternally) for the sins of the world.

A second problem this discussion leads to is the problem of what the suffering of Christ really amounts to. As Bergman points out (through one of his characters in the movie Winter Light) what is the big deal about physical pain? Surely there are hundreds, nay thousands, who have suffered great physical pain at one point or the other; in the history of the world there must be millions who have died more painful deaths than a flogging followed by a crucifixion. Indeed, one of my key takeaways from Gibson's ghoulish movie was precisely that the treatment meted out to Christ, far from being cruel and unusual, was pretty much par for the course at the time. In fact, watching the movie, I found my sympathies entirely with Pilate and Herod - what would you do with some scruffy vagabond who came along and declared he was the Son of God and the King of Heaven?

(In some ways, Christ's belief in his own status as Messiah is a problem in itself. For surely to believe that one is the Messiah, the saviour of the world, the one who will sit in Judgement over all mankind, is to give in to the temptation of Pride. Even to choose to be sacrificed, to be martyred for a cause is to be tempted - see, for instance, Eliot's Murder in the Cathedral)

Bergman's answer to this problem is that the real suffering of Christ consists in being deserted on the cross - the physical pain is nothing, it is the knowledge that he has been abandoned by everyone, that he must die, as every man does, alone. That is why Christ cries out "Lord! Why have you forsaken me?".

In this, I think, Bergman is close to the answer, but he doesn't quite develop the idea sufficiently. My own idea is that the entire story of Christ is about God's deliberate deception and betrayal of his own son. God deliberately plants his Son on earth, lets him grow up believing himself to be the Messiah, brings him to a point where Jesus believes sufficiently in his Father to be willing to sacrifice himself, and then abandons him utterly on the cross. There is, for Jesus, no pity, no place in heaven - only barren emptiness and oblivion. What God could not bring himself to demand of Abraham (how could he? what had he ever done that compared?) he now commits himself.

What, you may ask, would be the point of such a sacrifice? Precisely that a God who would go so far is beyond question. How dare a mere mortal demand an accounting for his sorrows, for his suffering, from a God who would willingly send his own son to be butchered? And conversely, what sacrifices, what excesses can such a God not demand in his name? Jesus is to God what Iphigenia was to Agammemnon - a sacrifice made not so much to propitiate the Gods as to establish the supremacy of one over all others. Imagine going into battle with someone who would cut off his own fingers. Who could possibly accuse such a person of being self-interested, of letting others suffer for his / her own good? Who could accuse him of giving orders without understanding, without knowing what it is to suffer? And at another, cruder level, how can one help admiring such a being's courage, his intensity. If someone is willing to sacrifice his son for a cause, then surely that cause, however illogical, however difficult, must be right.

In one master stroke, then, the story of Christ puts the Christian God beyond all human interference - he may demand whatever he wishes and yet nothing he does may be questioned. Before the New Testament, it was possible to become disillusioned with God - if you believed in him fervently and kept his edicts and still continued to suffer in misery, for instance. After the New Testament, all such questions were moot, and endless sacrifice was legitimated.

Who would make such a sacrifice? Someone who was hungry, no, desperate for power. There are two ways you can look at this of course - one that the story of Christ is one manufactured by the religious interests of the day, in a master stroke of politics, enabling them to win popular support (you're suffering? come to us - we have a God, a Messiah, who suffers too; we REALLY feel your pain). The other is that God (or at any rate the Christian God) actually is that megalomanical, so completely cold-blooded that he would sacrifice his own son to put any questions about his supremacy to rest once and for all (though that of course raises the question of whether it's really worth while believing in so cold-blooded a God).

But wait, you say, what about the resurrection? What about the return of Christ? If he was not saved, how could that have happened? It's always struck me as strange that Christ, when he returns, doesn't bring any particularly cheerful messages about the other side (I mean to say, you've just got back from a weekend trip to the afterlife; you think you'd have a few interesting anecdotes, maybe even a postcard or two). In fact, he doesn't really say anything about heaven or the next world at all (there is a passage that speaks of him being risen, but these words are spoken by an angel not by Jesus himself). So two possibilities exist - either he doesn't know what is in store for him - after all, it's not as though he's seen the Kingdom of Heaven or knows that it exists - maybe this is God's last, most cruel trick - to lull him into a false sense of triumph when all the while oblivion waits for him on the other side (if this were not true, why does he not return again, after those first three times? If he's really in heaven, and he really wants to convince people of this, why not come back more often, why not show himself to a larger audience? The testimony of a dozen people, and those the very ones close to him is hardly convincing evidence).

The other possibility is that he does know, but has been forced to come back by God, just to show himself (which is why he has nothing positive to say about the next world). Even disregarding the presumed omnipotence of God that would enable this, could not Jesus have been talked into coming back precisely in the name of the benefits believing in the lie would have for his followers? Suppose I said to you that everything you believed was a lie, but that you could save your closest friends and loved ones the pain of making this discovery by joining in the lie and helping to maintain the deception? Would you not do it? And wouldn't this be the most ironic, the most poetically sadistic way to do it?

Or perhaps it isn't even really Jesus but just an illusion sent by God to take his place. In any event, this is a classic carrot and stick - having effectively put God beyond human questioning, theology now offers the common man a sop, a glimpse of hope. This is a particularly clever carrot, because in essence it promises nothing and is by definition never going to happen to anyone else (I mean, this is special treatment reserved for the Son of God, right - why assume it has anything to do with ordinary mortals?)

It's also interesting, of course, how much this notion of Christ, of (as Eliot puts it) some 'infinitely gentle, infinitely suffering thing' though manifestly illogical has become so firmly entrenched in our pysche. Did this sympathy, nay, this respect, for those who suffer in silence always exist (what possible anthropological basis could there be for it?) or is it in fact an artifact of the Christ myth. And without this idea, would other political movements based on non-violence (such as India' struggle for Independence, for instance) have had any hope of working?