Free Speech and the Middle East

The United States Ambassador to Libya, J. Christopher Stevens, was killed by an armed Islamist mob attack on September 11, 2012. Originally, the Obama administration stated that the attacks were a “spontaneous reaction” to “a hateful and offensive video…” (Susan Rice, U.S. Ambassador to the UN). The video she was referring to was an amateur film, made in the U.S., which mocked Islam and was called “Innocence of Muslims.” This initial reaction was probably false as the timing (11 years to the day after September 11, 2001 attacks) and subsequent investigations appear to show the attack was coordinated and planned. Whatever the case may be, there have been many violent anti-American and anti-West demonstrations and actions throughout the Muslim world ostensibly as a reaction to the wildly unprofessional “Innocence of Muslims” movie trailer or the French publication, Charlie Hebdo, who published cartoons mocking the prophet Mohamed.

These events highlight a major difference in the way some Muslims (enough to fill big town squares during the workweek) and the West view free speech and tolerance of religion. In this post, I attempt to color that difference, to comment on American free speech, and to talk about my own view of free speech.

AMERICAN FREE EXPRESSION

The First Amendment states, “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.” This view of free expression and religion is inherited, in large part, from John Lock and John Stuart Mills. Locke believed that keeping established religion within the heart and home and out of political policymaking would lead to tolerance and end wars of religion. John Stuart Mills advocated the value of a marketplace of ideas. In essence, he thought that, although imperfect, the free trade in ideas was the best way to find truth as a society. Other philosophical justifications undergird American freedom of expression too. Self-governance requires freedom of opinion, religion, and expression. Suffrage requires it. If people are to be sovereign, they must have their own free opinions and be able to express them. There is also a deontological argument that it is an essential right for autonomous and self-determining human beings to express themselves. Otherwise, life would be meager. Free speech serves as a check to the abuse of power.  Free expression serves as a release or safety valve giving a recourse to dissidents other than draconian violence.

MUSLIM FREE EXPRESSION

Many Muslims do believe in free expression. Modernity, it appears, demands it, and it really seems easily reconcilable with the teachings of the Koran as I understand. Yet, too many Muslims refuse to embrace tolerance and free expression. Too few are willing to be offended in order to have peace and free conversation. For them, there is no difference between public and private. The reputation and integrity of their religion outweighs free speech and tolerance. If America disagreed with the distasteful speech, they believe, the government would prohibit it. Since America doesn't censor the speech, they must condone it. For such extremists, an offense to the religion is a personal assault not to be met with more words only, but also violence. If the Americans wont stop the speech that attacks them, they feel entitled to do it themselves.

Some of the Muslim world is easily offended. The reason for this is deep and tender. The beginning of Muslim history is one of spectacular success. The religion started in the 7th Century in the desolate and poor Arabian Peninsula and within a few hundred years spread from Spain to Indonesia. Muslim science and trade surpassed that of the entire world. The thinking of their philosophers was cutting-edge for the day. They had amazing architecture, art, and literature. Islam was great and was supposed to spread throughout all the world.

But, it didn’t. The fall of the Muslim, and particularly Arab Muslims, was swift and brutal. Mongols, Europeans, and Turks beat them militarily and surpassed their knowledge in humanities and sciences, and prospered above them. Even the most proud of Arab Muslims, when you talk to them, seem to be tenderly aware of their culture’s weaknesses and failures. The poverty, disparate treatment between men and women, rich and poor, and from faction to faction are all too easily observable to ignore. When outsiders poke at those tender weaknesses, some Arab Muslims explode into anger and violence.

In a way, their feelings are understandable; yet, violence is only hurting their culture more and incurring more disrespect and ridicule from outsiders. Taking responsibility as a society and channeling that frustration into improving life in the Arab world is the proper direction; not violence against annoying speech. Turkey, currently ruled by an Islamist party, has embraced pluralism and is one of the most respected and prosperous Muslim countries in the world. In some ways, Turkey is an example of a better direction. I am optimistic that change will come, perhaps slowly, but it will.

RECONCILING RIGHTS OF SPEECH WITH OTHER RIGHTS AND THE INTERESTS OF THE STATE

The right to free expression is not without bounds. It is necessarily delimited by other individual rights held by American citizens. In my view, the primary interests of the State are protecting its citizen’s individual rights and promoting a virtuous society. Freedom of speech and the right to receive information freely should be unfettered to the extent that it does not impinge on the rights of others. However, when the rights of others are affected (e.g. perhaps yelling fire in a crowded theatre or verbally abusing someone day in and day out week after week) then the state has the legitimate right to restrict the expression and receiving of information.

When a question arises as to where to draw the line between the right to free speech and some corresponding and mutually exclusive right, courts and legislatures should engage in an analysis similar to equal protection under the 14th Amendment. Laws restrictive of speech based on viewpoint are particularly suspect, content-based restrictions are suspect on an intermediate level, and content-neutral restrictions are presumed to be a legitimate use of State power unless proven otherwise. I assert that citizens should be afforded the RIGHT to pursue moral living without burdens that a reasonable or average American could not withstand. In other words, if they are accosted by pornography or abusive language or intellectual dishonesty that would overcome an average person’s ability to reason or live honorably within broad strokes of morality, than the law should be quick to limit speech at that point. Insults, blather, pornography, obscenity, threats, objective falsehoods, and the like are of such slight value as a step to truth, that the benefits of free speech are plainly outweighed by the broad morality, safety, and order such speech threaten. As we become a more virtuous society, the abilities of a reasonable person might improve. However, I believe that moderating free expression, not to promote morality, but to enable morality, is within the providence of government. Freedom is necessary for a virtuous society.

The Future Role of Finance in the United States

                                                                                          Photo: Ramy Majouji

In this post, I will try to paint in broad strokes my understanding of what caused the 2007 economic downturn and what I think it should mean for the future of the finance sector in the United States.

Starting in the 1990s and continuing into 2006, housing prices increased steadily and substantially. Variable rate mortgages and other sub-prime loans were riskily extended to those with relatively low credit ratings. Buyers assumed they would be able to pay the higher interest rates that kicked in after a designated time period because they thought their careers would progress or, in the alternative, they thought they could just sell their house for a profit. Overconfidence in the stability of the rising housing market prompted speculators to purchase, flip, and develop real property with little hesitation. The housing bubble grew until it burst in late-2006 and 2007. In most of the country, home prices initially only stalled. However, in markets like Florida, Nevada, Arizona, and California where there was an especially pronounced oversupply of housing, the prices dropped abruptly. The other states followed suit.

Then, in 2008, Bear Stearns, a giant investment bank was pulled into the red by its failing hedge funds that were heavily composed of investments in mortgage backed securities. Government sponsored enterprises Fannie Mae and Freddie Mac, dealers in mortgage backed securities, were both collapsing. The U.S. government took over management of Fannie Mae and Freddie Mac and bailed out AIG, a reinsurer of mortgage securities that was on the brink of failure too. By March of 2009, the Dow Jones had dropped from a high of 14,000 in 2006 to a mere 6,547.

Other financial industry giants were also failing. Lehman Brothers filed for bankruptcy and Merrill Lynch sold out to Bank of America hastily to avoid the same red-lettered fate. With other banking institutions like Citigroup teetering, the Legislature passed a $700 billion (yes, billion; as much as the entire GDP of Indonesia) bailout called TARP. They bought billions of dollars worth of stock in banks like Citigroup and guaranteed billions more dollars in loans. Taxpayers might still be Citigroup's largest shareholder. And yet, they cannot pass the government stress test even today.

The manufacturing industry suffered as a result of the crisis too. So the government poured billions of additional dollars into General Motors and Chrysler in addition to the TARP bailout. But both automobile companies and numerous other manufacturing companies went bankrupt anyway.

These problems affected the entire economy, making for fewer American jobs. In an effort to raise the unemployment rate, Congress provided a $787.2 billion (although the encumbered nature of some of the "investments" probably raise the true price to above $1 trillion) Economic Stimulus Package. Near the same time, Congress guaranteed billions more dollars of loans to failed banks.

The economic downturn has engendered a lot of anger (often directed at the finance industry and politicians) and even more finger pointing. Most likely, the combination of low mortgage interest rates and deregulation was the primary cause, although financial globalization, global imbalance of debt surplus and deficit, executive compensation, and credit cards among other factors likely contributed to the problem. The blame game is futile. What is important is learning from the past and moving forward instead of backwards (although perhaps something we did in the past is better).

We should not be mad at finance as a whole. The finance sector and many of its innovative financial instruments have enabled socially beneficial enterprises that were unimaginable before stock markets, mortgages, loans, bonds, swaps, options, micro-loans, crowd funding, etc. Therefore, the solution to the economic downturn caused by the housing crash is not to hastily restrict the size and inventiveness of the finance and business industries. Rather, regulations should be thought-out and designed to channel financial creativity in ways that most benefits the ability of small businesses and huge corporations to capitalize, grow, innovate, and succeed on the world stage.

One challenge faced by legislatures and economic policymakers is the fact that innovations in finance often help society; but, innovations in finance make finance more complex and harder to predict and understand thus making them more risky. Perhaps the price for the benefits of big and complex finance instruments is occasional bubbles and economic downturns. But, perhaps the cost is worth it. On the other hand, repentance is often harder than not messing up in the first place. Perhaps getting out of the economic ditches does take longer than not getting in them in the first place. I don't know the answer. But, I bet it is somewhere in the middle. Nations that are slow to innovate in finance and who make it hard to buy and sell risk lag behind other nations in political stability and economic growth (e.g. compare Ghana and S. Korea who had similar political and economic situations in 1960. Other factors played a role too [fertility rates, Ghana taking IMF loans, South Korea's linguistic and cultural unity, etc], but it is far-fetched to deny that S. Korea's financial acumen played no role).

The replacement of faith with moral relativity and cynicism also contributes to economic downturns. Without unifying belief in post-death consequences, there is no forceful constraint on behavior when there is pressure to act selfishly. My careful observations confirm that faithful people have more of a stomach to do what is right when nobody is looking. As the priority of religion dwindles in America, I predict that business and finance leaders will be less and less bound by morals and they will have more need of being restricted by economic regulations and criminal laws that will, in turn, burden the full potential of businesses and the finance sector to do good for society. Although a strong moral education and ethical character among leaders will not solve all the complex social risks of finance innovation, it is certainly an important part of the solution.

In short, I would say that the proper course for the United States vis-a-vis the finance industry is two-fold. First, complexity and innovation in finance should be encouraged, but not to such a degree that regulators, shareholders, and legislators can't understand reflect on the implications of the develpments. Regulation should be efficient and not overlapping or over-broad. Second (and the government's role is limited here), religion and traditional values need to have a stronger presence in the lives of Americans. This starts in the home.