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A Pathfinder Perspective: Sri Lanka no choice but to Restructure External Debt

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Has the time come to consider seriously the merits of restructuring the government’s external debt obligations? The Sri Lankan authorities have indicated that they are in the process of negotiating inflows to meet the country’s immediate foreign exchange requirements. However, there is considerable uncertainty as to whether there would be sufficient inflows to meet the acute dollar illiquidity over the medium-term.

Companies and even families,­­­­ restructure their debt when foreseeable future earnings become insufficient to repay debts, while maintaining their financial viability. The same applies to countries. Over the years, a number of countries have restructured their debt and the pandemic is pushing others to follow suit. Has Sri Lanka reached that point when it would be advantageous to restructure its external debt? What are the costs and benefits of doing so? If debt restructuring is a credible option, how one would go about it?

Should Sri Lanka restructure its external debt?

Foreign revenues in the next couple of years are extremely unlikely to be suffucuent to service external debt obligations, while supporting the essential foreign exchange (Forex) requirements of the economy. Known external debt repayments amount to USD26 billion over the next five years. It is unrealistic to expect to repay about USD 5 billion per year, particularly in the next 12-24 months, when foreign inflows are unlikely to increase on the scale necessary to service debt and finance imports necessary to meet essential needs and support the growth of the economy, particularly as the downgrading of Sri Lanka’s sovereign rating has excluded it from international capital markets. Countries protect access to these markets scrupulously to have the capacity to roll-over debt and avoid such a predicament.

It is noteworthy that the following Business Chambers have jointly issued a statement highlighting the severe problems being faced by their members due to the acute shortage of Forex which has been caused primarily by the combination of the loss of tourism earnings and access to international capital markets: Ceylon Chamber of Commerce, FCCISL, Ceylon National Chamber of Industries, The National Chamber of Commerce of Sri Lanka, The Women’s Chamber of Industry and Commerce, Chamber of Young Lankan Entrepreneurs, The International Chamber of Commerce Sri Lanka, National Chamber of Exporters and the Chamber of the Construction Industry.

Collectively, these Chambers represent almost all sectors of the economy. Their concerns cannot be addressed while there is a diversion of large amounts of Forex from markets to the Central Bank of Sri Lanka (CBSL) to service external debt. As a result, there is now a strong case for considering debt restructuring to release foreign exchange to meet the needs of businesses and acquire the essential needs of the people, e.g., food, fuel and pharmaceuticals.

The costs and benefits of external debt restructuring.

The most significant disadvantage of restructuring external debt is an immediate loss of access to international capital markets. This is now completely irrelevant for Sri Lanka as market access was lost when the economy was downgraded to a CCC rating. It is now even lower, at CC. As a result, Sri Lanka can no longer borrow in international markets. Another downside is the increase in the risk premium Sri Lanka would need to pay when it is eventually able to regain market access. However, the increased risk premium demanded by markets as a result of the restructuring is likely to be tempered by the impressive commitment Sri Lanka has shown in meeting its obligations thus far. Two International Sovereign Bonds (ISBs) of USD 1 billion each were repaid on time in October 2019 and July 2020, despite having to deplete external reserves, thereby imposing sacrifices on domestic businesses and households. This combined with Sri Lanka’s impeccable debt servicing record to date is likely to contain the increase in the cost of future borrowing when it becomes possible.

Domestic banks have holdings of both ISBs and Sri Lanka Development Bonds (SLDBs). Both these instruments will be impacted by any debt restructuring exercise. Foreign bond holders are extremely unlikely to accept exemption from haircuts of domestic entities, mainly banks, which hold US-denominated debt, issued both abroad and domestically. Hence not only ISBs but also SLDBs will need to be included in the pool of debt to be restructured.

It is important to note that the impact of any haircut will not be as painful as some may fear, since many of the domestic entities have purchased ISBs at an already discounted price in the secondary market. (There would be no such mitigation for SLDBS, which are not a tradeable instrument.) If necessary, the CBSL would need to provide some temporary regulatory forbearance to any domestic bank which experiences capital adequacy challenges due to haircuts imposed on creditors as part of the debt restructuring.

Options for Restructuring

Debt restructuring is a long and complex process. Having delayed and allowed usable reserves to deplete to barely one month’s import cover, it is no longer possible to achieve a soft pre-emptive restructuring. There are three modalities available to restructure debt: reprofiling the principal (extending maturities); modifying coupon (interest) rates; and write-down of principal (haircuts). Given its current circumstances it is unlikely that Sri Lanka could avoid haircuts for its creditors.

It is unrealistic and impractical to expect to restructure external debt without the support of the IMF. Before embarking on an external debt restructuring one needs the IMF to independently validate that Sri Lanka has a strong need to restructure its debt, in order to assure creditors that the Sri Lankan authorities are not being opportunistic. The IMF would also need to validate the proposed medium-term fiscal adjustment path to debt sustainability.

Rescheduling bilateral, commercial and multilateral debt requires different treatments. Bilateral debt rescheduling is negotiated with the Paris Club of creditors. It is not possible to approach the Paris Club without IMF support. China and India are not members of the Paris Club and separate negotiations would be necessary with them. An option is to seek to initiate an informal “Common Framework” approach (approved by the G20 which includes both China and India). It would need to be informal as the “Common Framework” is not available for a middle-income country like Sri Lanka.

This approach would have the advantage of including Sri Lanka’s three major bilateral donors: China, India and Japan. Bilaterals are likely to focus more on stretching maturities. Commercial creditors could be approached once a deal is in place with bilateral donors. Such sequencing can lead to a better deal for the debtor country on the basis of equivalence across all creditors in terms of the rescheduling. In this respect, there is considerable merit in taking soundings from the Japanese Ministry of Finance regarding their suggestions for the terms of the restructuring. Over the years, Japan has proved to be a flexible and generous creditor in this respect.

On Commercial debt, here again, it is exceedingly difficult to proceed without the IMF. Given its current circumstances, the restructuring package for Sri Lanka’s commercial debt is likely to include a combination of stretching maturities; coupon modification and a haircut. Haircuts on repayment of principal should be avoided, if at all possible, as they delay rating improvement and regaining market access. It is likely that it is now too late for Sri Lanka to avoid a haircut for its commercial creditors. It makes little sense to scar the economy and cause hardship to the people in order to pay ISB holders 100 cents in the dollar when most of the bonds outstanding have been discounted by more than 40 percent.

It is not possible to restructure Multilateral debt (i.e., debt owed to the World Bank, the Asian Development Bank and the IMF) without a complete suspension of the relationship between Sri Lanka and these institutions. There would be a suspension of all lending activity including project loans. However, the practice has been for to these institutions to provide financing to assist the debtor country to service the payments owed to each of them, once the debt rescheduling package is negotiated.

Appointment of Advisers

It is customary to appoint a financial and a legal adviser at the outset of the restructuring process. The IMF is able to provide a list of potential advisers from which the country concerned can choose.

Pathfinder Perspective – Conclusion

The unsustainability of Sri Lanka’s external debt is the cumulative effect of poor economic management over several decades. The size and persistence of the external financing gap for the foreseeable future makes debt restructuring an urgent priority. It should be possible to negotiate a package which provides three years of breathing space to rebuild Sri Lanka’s economy to earn and attract sufficient foreign inflows to achieve external debt sustainability and place the economy on a path of sustained growth. Nearly 75% of Government external debt is owed to bilateral and commercial creditors, all of which is eligible for rescheduling, thus providing considerable scope for relief from onerous debt repayments. Now that Sri Lanka has lost access to international capital markets and is extremely unlikely to regain it for some years due to its CC rating, there is very little downside and very considerable upside to debt restructuring.

There is now no choice but to restructure our external debt. The positive impact on dollar liquidity will be substantial and could be measured in billions of dollars. It is also timely as the negative social consequences are manifesting themselves in terms of ever-increasing hardships for the people, particularly the poor and vulnerable. It does not seem realistic to count on short term liquidity injections or a reliance on a revival in tourism as well as increased exports, FDI and remittances, to overcome the dollar illiquidity and its negative consequences in the next couple of years. Paying back debt at the expense of scarring the economy and imposing hardships on the people should not be seen as a badge of honour.

This is A Pathfinder Perspective issued by the Pathfinder Foundation can view on https://pathfinderfoundation.org/ Readers’ comments via email to are welcome.



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Rebirth in Buddhism

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By Dr. Justice Chandradasa Nanayakkara

The question of what happens after death naturally arises in the mind of thoughtful people, as we do not know what lies beyond death, because no one has ever returned to the living to recount his experiences life after death. Almost every religion across the world has a defined belief on what happens when a person dies, yet the question is still widely debated and discussed without any finality being reached on the issue. Most of the religious teachers from the earliest times, have been unanimous in affirming that life continues beyond the grave, but they differ widely on the question of what form and in what manner the survival takes place. Nevertheless, mankind continues to believe in some form of survival after death.

Regarding the question of survival after death, thinkers have generally followed one of two philosophical concepts. That is to say annihilationism and eternalism (in Buddhist, ucchedavada and sassatavada). First view is held by nihilists who claim that there is no life after death. They hold the view with the disintegration of the physical body the personality ceases to exist. This view accords with materialistic philosophy, which refuses to accept knowledge of mental conditionality. Those who hold the second view think that there is an abiding entity which exists forever and individual personality persists after death in a recognizable form as an entity called soul, spirit or self. This belief in some form or another is the basis of all theistic religions.

If you stick to the first view and deny that there is no continuity of life after death there would not be no moral law and vipaka (actions and results) operating in the universe enunciated by Lord Buddha and there would be no object in practicing self-restraint or endeavoring to free ourselves of the craving thanha which brings suffering in its wake. The cardinal teachings of the Buddha such as path to nibbana, Four Noble Truths and the eightfold path would be rendered nugatory and meaningless if death is followed by complete extinction. Similarly, those who believe eternalism which presupposes that individual personality persists after death in the form of soul or self as an enduring personality by means of transmigration is also rejected by Buddhism. This view runs counter to the very essence of Buddhism which denies existence of soul. This is the teaching of anatta doctrine, which distinguishes buddhism from other religions and marks it out from all other religious concepts.

In view of the virtual impossibility of establishing the truth of survival after death through empirical methods, question arises what is the attitude of science to this important and abstruse question which has baffled the minds of many people. Although, it is not possible to posit ‘rebirth’ as a scientific fact many men of science are of the opinion that mental, moral and physical inequalities can be accounted for on no other hypothesis than ‘rebirth’ hypothesis.

The idea of a cycle of birth and ‘rebirth’ is part of the teachings of the Lord Buddha. For many Buddhists death is not seen as an end, but rather as a continuation. Buddhists believe a person goes from life to life and see it another part of their long journey through samsara.

Buddhists do not regard ‘rebirth’ as a mere theory but as fact verifiable by evidence and it forms a fundamental tenet in Buddhism along with the concept of karma. Therefore, two principles-kamma and ‘rebirth’ are fundamental to understanding the teachings of Buddha. Kamma and ‘rebirth’ go in arm in arm. According to Buddhism there is no life after death or life before birth independent of kamma. Kamma is an immutable law of cause and effect, and we cannot avoid its consequences. Where there is kamma there must be ‘rebirth’. Most experiences in our present life are the results of our previous actions. Our actions of body, speech and mind (volitional activities) rebound back to us either in the present life or in some future life. It is the karma that conditions ‘rebirth’, past kamma conditions the present birth, the present kamma in combination with past kamma conditions the future. The present is the offspring of the past, and becomes in turn the parent of the future. For Buddhist death is not complete annihilation of a being though that particular life span ended, the force which hitherto actuated it is not destroyed. After death the life flux of man continues ad infinitum as long as there is ignorance and craving. Man will be able to put an end his repeated series of births by realizing nibbana, the complete annihilation of all forms of craving (Narada Thera).

The Buddhist doctrine of ‘rebirth’ should be differentiated from the theory of reincarnation, which implies transmigration of a soul and its invariable ‘rebirth’, as it is enunciated in Hinduism.

In his book What the Buddha Taught, Walpola Rahula Thera posed the question “if we can understand that in this life we can continue without a permanent, unchanging substance like self or soul, why can’t we understand that those forces themselves can continue without a self or soul behind them after the non-functioning of the body? ‘When this physical body is no more capable of functioning, energies do not die with it, but continue to take some other shape or form, which we call another life… physical and mental energies which constitute the so called being have within themselves the power to take a new form, and grow gradually and gather force to the full: King Milinda questioning venerable Nagasena asked: “Venerable Nagasena, does ‘rebirth’ take place without anything transmigrating? Yes, O king, ‘rebirth’ takes place without anything transmigrating? “Give me illustration, venerable Sir. Suppose, O king, a man were to light a light from light pray, would the one light have passed over to the other light?” “Nay, indeed, Venerable Sir. “In exactly the same way, O king, does ‘rebirth’ take place without anything transmigrating.

In this connection, it should be mentioned the word ‘rebirth’ is not a satisfactory one, as it implies that there is something that after death takes on flesh again. It connotes transmigration of soul or other entity consequent to a death of a person. The Pali Word used in buddhism is arising or Phunabba.

As there is no soul or self in Buddhism, question arises if there is no soul or self what is there to be reborn. This has been most vexed question among many religious scholars. This has been a topic of debate for centuries. According to buddhism there is no enduring, substantial or independently existing entity that transmigrates from life to life instead there is simply an apparent continuity of momentary consciousness from one life time to the next that is imbued with impressions or traces (samskaras)of the actions one has committed in the past. For Buddhists everything is changing and nothing is permanent. So, when a person dies not he but his energies that shape him take a new form. New life is connected to previous life through kamma. There is rapid succession of thoughts throughout the life continuum.

The Buddha is our greatest authority on ‘rebirth. Therefore, for Buddhist no other evidence is necessary is prove ‘rebirth’.

On the very night of His enlightenment during the first watch, enlightenment, Buddhas mind travelled back through all of his unaccountable past lives. This was facilitated by the development of retro cognitive knowledge. Though his mind stretched back to countless eons he never saw a beginning to his past existence. He found no beginning and no end. He also saw all the beings in the universe being born, living dying and being reborn over and over again without end, all trapped in a web spun by their past actions. This process is the round of ‘rebirth’ known as samsara, which means wandering from life to life with no particular direction or purpose.

The Buddha before his enlightenment as bodhisattva was born in different forms of existence. As such Buddhist have a firm belief in many realms of existence, both above and below the human realm. Therefore, we can safely assume we all have lived through countless different lifetimes before being born in the world and our birth here as a human being is the result of predominantly good kamma we have committed in the past life. Those good kamma may have been done in many life times before, or more likely done in the previous life. Therefore, the quality of future births depends on the moral quality of our actions now.

In Dhammachackka Sutta too in his first discourse referring to second noble truth, Buddha declared this very craving is that leads to ‘rebirth’.

In ancient Greece philosophers like Empedocles and Pythagoras too taught the doctrine of ‘rebirth’ and Plato made it an important assumption in his philosophy, as pointed out by Ven Piyadassi Thera.

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A Good Guide to the Omicron Variant

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By M.C.M. Iqbal, PhD

Despite the WHO adopting a neutral system to name the variants of the coronavirus that keep emerging (using letters of the Greek alphabet), the Omicron variant is associated with South Africa. The last variant of the virus to emerge was the Delta variant, which surfaced in December 2020, in India. There are two more letters between Delta and Omicron in the Greek alphabet that the WHO decided not to use. These are ‘Nu’ and ‘Xie’, which the WHO thought could be confused with ‘new’ while Xie is a common surname in China.

The Omicron variant is spreading in many countries. With the number of infected persons rising and another wave expected, many countries in Europe have imposed the usual methods to arrest the spread, with immediate lockdowns. However, scientists are still collecting data to find out how bad Omicron is, since the data seems to indicate that in South Africa, the disease is not as bad as the Delta variant. At the same time, in Europe, there is no significant change in the number of persons hospitalized. Of immediate concern to health authorities are, is the Omicron variant spreading faster than the earlier variants, does it cause more or less severe disease, and can it bypass the vaccines available?

Discovery

Scientists in South Africa announced on 25 November the discovery of a new variant of the coronavirus. On 26 November, the WHO named it Omicron. Although South Africa has been labeled as the country of origin, the virus was identified in neighbouring Botswana. In addition, there are reports of an earlier detection of this variant in the Netherlands.

PCR tests look for four markers on the virus genome to identify it as the coronavirus. The tests in Botswana showed a reduced sensitivity because one of the four targets was not being detected. These samples were sent to South Africa, where scientists have state-of-the-art facilities to look for changes in the genome of the virus. Changes are found by reading the ‘letters’ of the virus genome (called sequencing) and comparing it to the already available genome of the virus. The new Omicron variant had many more changes than the Delta variant.

Global status

By 14th January, the Omicron variant had spread to 116 countries in all six continents since its discovery on 26 November 2021. The figure below shows the gradual replacement of the presently dominant Delta variant by the Omicron variant; at present global data on the coronavirus, maintained by Nextstrain (https:// nextstrain.org/ncov/open/global) shows a decline of the Delta variant from 88% on 30th October 2021 to 42% on 8th January 2022, while correspondingly the Omicron variant has increased from less than 1% to 56%. Nextstrain is a global database presenting a real-time view of the evolution of the genomes of the coronavirus and other globally important pathogens. The interactive platform provides information to professionals and the public to understand the spread and evolution of pathogens, including information on individual countries.

Distribution of Delta and Omicron variants on 1st January 2022 from Nextstrain. (Please see graph)

What’s unique about Omicron?

Unlike the previous variants of the coronavirus, this variant has over 30 changes (mutations) to its spike (a protein), the characteristic flower-like protrusion on its surface. It was these changes to the spike, one of the four targets of the PCR test that raised alarm bells in Botswana. This spike makes the coronavirus special – it is the key it uses to gain entry into the cells in our throat and lungs. The previous variants, Alpha and Delta also had changes in their spike protein, enabling them to enter cells more efficiently and thus making them more infectious. The vaccines against the virus are based on this spike, and the antibodies produced by our immune system are specific to the spike protein. Thus, any significant changes to the spike means the previous vaccines may not be effective against the newly changed spikes on the Omicron variant.

While the Omicron variant can spread rapidly, it appears to cause milder disease compared to the Alpha and Delta variants. Scientists believe this is because Omicron infects the upper airways or the throat, and not the lungs further down. Based on experiments done on hamsters and mice, scientists found the concentration of the virus was much lower in the lungs than in their throat. The earlier variants of the coronavirus caused severe damage to the lungs of the infected people, with extreme cases needing oxygen. This does not seem to be the case with Omicron. Scientists believe the changes to the spike enables the virus to enter cells in the throat more easily than in the lungs.

It can spread rapidly

The virus is quickly expelled into the air if it infects and multiplies in the throat. Since it causes a milder form of the disease, infected persons may be unaware that they carry the virus. They would be moving about socially and at work, spreading the virus. Thus, the obvious means of slowing or preventing the spread of the virus is to strictly wear the mask at all times, and avoid social gatherings.

Studies have suggested that the period between exposure to the virus and onset of symptoms has also reduced to three days for Omicron. At the pandemic’s beginning, this was more than five days, and for the Delta variant it was four days.

What is of immediate concern?

Of concern to scientists is the better ability of the Omicron to spread rapidly in the population and its suspected ability to bypass our immune system. Our immune system is our internal defense system, using antibodies and an arsenal of chemicals and cells. The available vaccines are designed on the coronavirus variants circulating in the population. Thus, major changes to the coronavirus can reduce the efficiency of the available vaccines. Both these concerns have been observed in the past month: Omicron can spread more rapidly than the presently dominant Delta variant, and observations on vaccinated people show a reduced ability by the vaccines to prevent infections, compared to the Delta variant. This has called for booster doses for people who have already received the two mandatory doses. In Israel, even a fourth vaccination is being administered.

How could the variant have evolved?

Variants of the coronavirus result from changes to the virus’s genome, called mutations. What is troubling about the Omicron variant is that it has many mutations in its spike. Mutations happen spontaneously as the virus multiplies in our bodies and spreads to others. Thus, the virus gradually accumulates small changes to its advantage. These advantages are infecting us more efficiently, spreading to others more easily, and multiplying more rapidly. Scientists believe that one possibility is that the virus circulated in a small isolated group of people (say a village), piling up the mutations over time, and then escaping into a broader population, and then eventually crossing borders.

Another possibility is that it developed in a single individual and spread to others. This happens when a person has low immunity, resulting in a prolonged infection because the immune system cannot eliminate the virus. This leads to the virus developing changes (mutating) to overcome the mild immune response. Answering this question needs scientists to painstakingly reconstruct the history of the virus, using tools from molecular biology. Unfortunately, locating patient zero is difficult since it is impossible to analyze the virus (or sequence its genome) of all the persons infected with the Omicron variant. What is usually possible is to determine a general area or community and the time of origin.

What can we do about it?

Vaccinate! This is the primary tool we have to prevent the spread of the virus and not give it opportunities to multiply. In addition, we should rigorously follow the simple rules we are familiar with – wear the mask when outside, physically distance ourselves, and follow hygienic practices by washing our hands with soap, and avoiding touching our nose and face with possibly contaminated hands.

The good news

The coronavirus has been with us for over two years. Many were infected and have recovered from the virus during this period, providing natural immunity. Others have acquired immunity through vaccinations. When a new variant infects these people, they will manifest a milder form of the disease. This may explain the reduced hospitalisation of Omicron patients.

A booster dose to those already vaccinated or were naturally infected by the coronavirus, appears to provide reasonable protection against the Omicron variant.

And the bad news

The Omicron variant can evade immunity from previous infections. A recent analysis of surveillance data from South Africa, involving over two million persons, indicated suspected reinfections of those previously infected. This is in contrast to Beta and Delta variants, which did not lead to reinfections on such a scale.

The Future

The coronavirus is here for the long haul. Variants will keep emerging, and it seems unlikely it can be eradicated. The media should help counter vaccine hesitancy and the spread of misinformation. As individuals, we need to understand the biology of the virus to avoid spreading the virus and infecting ourselves and others. Science has to be supported in a broad sense to develop strategies by the health authorities and policymakers.

Further reading

S. Wild. How the Omicron variant got so many scary mutations. Scientific American, 3rd December 2021.

Michael Chan Chi-wai.

G. Vogel and K. Kupferschmidt. Early lab studies hint Omicron may be milder. But most scientists reserve judgment. Science, 20th December 2021.

K. Kupferschmidt and G. Vogel. Omicron threats remain fuzzy as cases explode. Science, 7 January 2022.

(The writer is a scientist in Plant and Environmental Sciences, National Institute of Fundamental Studies, Hanthane Road, Kandy. He can be reached at iqbal.mo@nifs.ac.lk)

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The taste of freedom

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by Bhikkhu Bodhi

(Courtesy Access to Insight – BCBS Edition)

The clarion call of our present age is, without doubt, the call for freedom. Perhaps at no time in the past history of mankind so much as at present has the cry for freedom sounded so widely and so urgently, perhaps never before has it penetrated so deeply into the fabric of human existence.

In response to man’s quest for freedom, far-reaching changes have been wrought in almost every sphere of his activity — political, social, cultural and religious. The vast empires which once sprawled over the earth, engulfing like huge mythical sea-monsters the continents in their grasp, have crumbled away and disintegrated, as the peoples over whom they reigned have risen up to repossess their native lands — in the name of independence, liberty and self-rule.

Old political forms such as monarchy and oligarchy have given way to democracy — government by the people — because every man demands the right to contribute his voice to the direction of his collective life. Long-standing social institutions which kept man enthralled since before the dawn of history — slavery, serfdom, the caste-system — have now disappeared, or are rapidly disappearing, while accounts of liberation movements of one sort or another daily deck the headlines of our newspapers and crowd the pages of our popular journals.

The arts, too, bear testimony to this quest for greater freedom: free verse in poetry, abstract expression in painting, and atonal composition in music, are just a few of the innovations which have toppled restrictive traditional structures to give the artist open space in his drive for self-expression. Even religion has not been able to claim immunity from this expanding frontier of liberation. No longer can systems of belief and codes of conduct justify themselves, as in the past, on the grounds that they are commanded by God, sanctified by scripture, or prescribed by the priesthood. They must now be prepared to stand out in the open, shorn of their veils of sanctity, exposed to the critical thrust of the contemporary thinker who assumes himself the right to free inquiry and takes his own reason and experience for his court of final appeal. Freedom of speech, freedom of the press, and freedom of action have become the watchwords of our public life, freedom of thought and freedom of conscience the watchwords of our private life. In any form in which it obtains, freedom is guarded as our most precious possession, more valuable than life itself. “Give me liberty or give me death,” an American patriot exclaimed two hundred years ago. The succeeding centuries have echoed his demand.

As though in response to mankind’s call for wider frontiers of freedom, the Buddha offers to the world His Teaching, the Dhamma, as a pathway to liberation as applicable today as it was when first proclaimed twenty-five centuries ago.

“Just as in the great ocean there is but one taste — the taste of salt — so in this Doctrine and Discipline (dhammavinaya) there is but one taste — the taste of freedom”: with these words the Buddha vouches for the emancipating quality of His doctrine.

Whether one samples water taken from the surface of the ocean, or from its middling region, or from its depths, the taste of the water is in every case the same — the taste of salt. And again, whether one drinks but a thimble-full of ocean water, or a glass-full, or a bucket-full, the same salty taste is present throughout. Analogously with the Buddha’s Teaching, a single flavor — the flavor of freedom (vimuttirasa) — pervades the entire Doctrine and Discipline, from its beginning to its end, from its gentle surface to its unfathomable depths. Whether one samples the Dhamma at its more elementary level — in the practice of generosity and moral discipline, in acts of devotion and piety, in conduct governed by reverence, courtesy, and loving-kindness; or at its intermediate level — in the taintless supramundane knowledge and deliverance realized by the liberated saint, in every case the taste is the same — the taste of freedom.

If one practices the Dhamma to a limited extent, leading a house-hold life in accordance with righteous principles, then one experiences in return a limited measure of freedom; if one practices the Dhamma to a fuller extent, going forth into the homeless state of monkhood, dwelling in seclusion adorned with the virtues of a recluse, contemplating the rise and fall of all conditioned things, then one experiences a fuller measure of freedom; and if one practices the Dhamma to its consummation, realising in this present life the goal of final deliverance, then one experiences a freedom that is measureless.

At every level the flavor of the Teaching is of a single nature, the flavor of freedom. It is only the degree to which this flavor is enjoyed that differs, and the difference in degree is precisely proportional to the extent of one’s practice. Practice a little Dhamma and one reaps a little freedom, practice abundant Dhamma and one reaps abundant freedom. The Dhamma brings its own reward of freedom, always with the exactness of scientific law.

Since the Dhamma proposes to provide a freedom as complete and perfect as any the modern world might envisage, a fundamental congruence appears to obtain between man’s aspiration for expanding horizons of liberty and the possibilities he might realize through the practice of the Buddha’s teaching. Nevertheless, despite this concordance of ends, when our contemporaries first encounter the Dhamma they often find themselves confronted at the outset by one particular feature which, clashing with their familiar modes of thought, strikes them intellectually as a contradiction and emotionally as a stumbling block. This is the fact that while the Dhamma purports to be a pathway to liberation, a Teaching pervaded throughout by ‘the taste of freedom,’ it yet requires from its followers the practice of a regimen that seems the very antithesis of freedom — a regimen built upon discipline, restraint, and self-control. “On the one hand we seek freedom,” our contemporaries object, “and on the other we are told that to reach this freedom our deeds, words, and thoughts must be curbed and controlled.” What are we to make of this astonishing thesis the Buddha’s Teaching appears to advance: that to achieve freedom, freedom must be curtailed? Can freedom as an end really be achieved by means that involve the very denial of freedom?

The solution to this seeming paradox lies in the distinction between two kinds of freedom — between freedom as license and freedom as spiritual autonomy. Contemporary man, for the most part, identifies freedom with license. For him, freedom means the license to pursue undisturbed his impulses, passions and whims. To be free, he believes, he must be at liberty to do whatever he wants, to say whatever he wants and to think whatever he wants. Every restriction laid upon this license he sees as an encroachment upon his freedom; hence a practical regimen calling for restraint of deed, word, and thought, for discipline and self-control, strikes him as a form of bondage. But the freedom spoken of in the Buddha’s Teaching is not the same as license. The freedom to which the Buddha points is spiritual freedom — an inward autonomy of the mind which follows upon the destruction of the defilements, manifests itself in an emancipation from the mold of impulsive and compulsive patterns of behavior, and culminates in final deliverance from samsara, the round of repeated birth and death.

In contrast to license, spiritual freedom cannot be acquired by external means. It can only be attained inwardly, through a course of training requiring the renunciation of passion and impulse in the interest of a higher end.

The spiritual autonomy that emerges from this struggle is the ultimate triumph over all confinement and self-limitation; but the victory can never be achieved without conforming to the requirements of the contest — requirements that include restraint, control, discipline and, as the final price, the surrender of self-assertive desire.

In order to bring this notion of freedom into clearer focus, let us approach it via its opposite condition, the state of bondage, and begin by considering a case of extreme physical confinement. Suppose there is a man locked away in a prison, in a cell with dense stone walls and sturdy steel bars. He is tied to a chair — his wrists bound together by rope behind his back, his feet locked in shackles, his eyes covered by a blindfold and his mouth by a gag. Suppose that one day the rope is unfastened, the shackles loosened, the blindfold and gag removed. Now the man is at liberty to move about the cell, to stretch his limbs, to speak, and to see. But though at first he might imagine that he is free, it would not take him long to realize that true freedom is still as distant as the clear blue sky beyond the stoned and steel bars of his cell.

But suppose, next, that we release the man from prison, set him up as a middle-class householder, and restore to him his full body of rights as a citizen of the state. Now he can enjoy the social and political freedom he lacked as a prisoner; he can vote, work, and travel as he likes, can even hold public office. But there still remains — in the form of his responsibilities, his burden of duties, his limitations of power, pleasure, and prestige — a painful discrepancy between the freedom of mastery for which he might personally yearn, and the actuality of the situation which circumstances has doled out to him as his drearisome lot. So let us, as a further step, lift our man up from this middle-class routine, and install him, to his pleasant surprise upon the throne of a world monarch, a universal emperor exercising sovereignty over all the earth. Let us place him in a magnificent palace, surrounded by a hundred wives more beautiful than lotus-flowers, possessed of limitless resources of gold, land, and gems, endowed with the most sublime pleasures of the five senses. All power is his, all enjoyment, fame, glory, and wealth. He needs only express his will for it to be taken as command, need only utter a wish for it to be translated into deed. No obstruction to his freedom of license remains. But still the question stands: is he truly free? Let us consider the issue at a deeper level.

Three kinds of feelings have been pointed out by the Buddha: pleasant feeling, painful feeling, and neutral feeling, i.e., feeling which is neither pleasant nor painful. These three classes exhaust the totality of feeling, and one feeling of one class must be present on any given occasion of experience. Again, three mental factors have been singled out by the Buddha as the subjective counterparts of the three classes of feeling and described by him as anusaya, latent tendencies which have been lying dormant in the subconscious mental continua of sentient beings since beginningless time, always ready to crop up into a state of manifestation when an appropriate stimulus is encountered, and to subside again into the state of dormancy when the impact of the stimulus has worn off.

These three mental factors are lust (raga), repugnance (patigha), and ignorance (avijja), psychological equivalents of the unwholesome roots of greed (lobha), hatred (dosa), and delusion (moha). When a worldling, with a mind untrained in the higher course of mental discipline taught by the Buddha, experiences a pleasant feeling, then the latent tendency to lust springs up in response — a desire to possess and enjoy the object serving as stimulus for the pleasant feeling. When a worldling experiences a painful feeling, then the latent tendency to repugnance comes into play, an aversion toward the cause of the pain. And when a worldling experiences a neutral feeling, then the latent tendency to ignorance — present but recessive on occasions of lust and aversion — rises to prominence, shrouding the worldling’s consciousness in a cloak of dull apathy.

On whatever occasion the three latent tendencies to lust, repugnance, and ignorance are provoked by their corresponding feelings from their dormant condition into a state of activity, if a man does not make an effort to dispel them, does not strive to restrain, remove, and abandon them and bring them to nought, then they will persist in consciousness. If, as they persist in consciousness, he repeatedly yields to them, endorses them, and continues to cling to them, they will gather momentum, come to growth, and like a ball of flame flung upon a haystack, flare up from their initial phase as feeble impulses into powerful obsessions which usurp from a man his capacity for self-control. Then, even if a man be, like our hypothetical subject, an emperor over the earth, he is inwardly no longer his own master but a servant at the bidding of his own defilements of mind.

Under the dominance of lust, he is drawn to the pleasant, under the dominance of hate he is repelled by the painful, under the dominance of delusion he is confused by the neutral. He is bent up by happiness, bent down by sorrow, elated by gain, honor, and praise, dejected by loss, dishonor, and blame. Even though he perceives that a particular course of action can lead only to his harm, he is powerless to avoid it; even though he knows that an alternative course of action is clearly to his advantage, he is unable to pursue it. Swept on by the current of unabandoned defilements, he is driven from existence to existence through the ocean of samsara, with its waves of birth and death, its whirlpools of misery and despair. Outwardly, he may be a ruler over all the world, but in the court of consciousness he is still a prisoner. In terms of license he may be completely free, but in terms of spiritual autonomy he remains a victim of bondage in its most desperate form: bondage to the workings of a defiled mind.

Spiritual freedom, as the opposite of this condition of bondage, must therefore mean freedom from lust, hatred, and delusion. When lust, hatred, and delusion are abandoned in a man, cut off at the root so that they no longer remain even in latent form, then a man finds for himself a seat of autonomy from which he can never be dethroned, a position of mastery from which he can never be shaken. Even though he be a mendicant gathering his alms from house to house, he is still a king; even though he be locked behind bars of steel, he is inwardly free. He is now sovereign over his own mind, and as such over the whole universe; for nothing in the universe can take from him that deliverance of heart which is his inalienable possession. He dwells in the world among the things of the world, yet stands in perfect poise above the world’s ebb and flow. If pleasant objects come within range of his perception he does not yearn for them, if painful objects come into range he does not recoil from them. He looks upon both with equanimity and notes their rise and fall. Toward the pairs of opposites which keep the world in rotation he is without concern, the cycle of attraction and repulsion he has broken at its base. A lump of gold and a lump of clay are to his eyes the same; praise and scorn are to his ears empty sounds. He abides in the freedom he has won through long and disciplined effort. He is free from suffering, for with the defilements uprooted no more can sorrow or grief fall upon his heart; there remains only that perfect bliss unsullied by any trace of craving.

He is free from fear, from the chill of anxiety which even kings know in their palaces, protected by bodyguards inside and out. And he is free from disease, from the sickness of the passions vexing and feverish that tie the mind in knots, from the sickness of samsara with its rounds of defilement, action, and result. He passes his days in peace, pervading the world with a mind of boundless compassion, enjoying the bliss of emancipation, or teaching fellow way-farers the path he himself has followed to the goal, in the calm certain knowledge that for him the beginningless trail of repeated births and deaths has been brought to a close, that he has reached the pinnacle of holiness and effected the cessation of all future becoming.

In its fullness, the freedom to which the Buddha points as the goal of His Teaching can only be enjoyed by him who has made the realization of the goal a matter of his own living experience. But just as salt lends its taste to whatever food it is used to season, so does the taste of freedom pervade the entire range of the Doctrine and Discipline proclaimed by the Buddha, its beginning, its middle, and its end. Whatever our degree of progress may be in the practice of the Dhamma, to that extent may the taste of freedom be enjoyed. It must always be borne in mind, however, that true freedom — the inward autonomy of the mind — does not descend as a gift of grace. It can only be won by the practice of the path to freedom, the Noble Eightfold Path.

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