This is part XXII of Vishal’s monthly series “Why Are We Backward?” for India’s Backward Castes.
In the holy city of Gangapur, two preachers were most renowned:  Gyananand enthralled his audience by explaining that the European numerals (I, II, III, IV, V, etc) could not have produced Western science, technology, banking, or economic development. They were inherently incapable of calculating mathematical units such as percentages or economic units such as compound interest. Dhyananand would then describe the accomplishments of Indian mathematicians such as Brahmagupta (seventh century), Mahavira (ninth century), and Bhaskara (twelfth century). The two never failed to mention that the world of modern finance owes its existence to the unknown sage who may have been a Brahmin and may have meditated on the banks of Mother Ganges, as he came up with the all important mathematical concept of shoonya (zero).
Uma Devi was one their favorite devotees. In fact, all the “holy” men were fond of her because whenever an ascetic went to her door, she always sent one of her children with freshly cooked food. She had made it a morning habit to set aside the first portion of the food for sadhus, who had renounced their own wives, children, and parents in order to find enlightenment. Her piety, however, did not prevent god Saturn from devouring her husband along with her youngest son. The truck that hit his scooter simply vanished. The tragedy became even more terrible because the scooter’s insurance had run out. Her husband had chosen not to renew it, since he was thinking of getting a loan for a small car for the family. Uma’s world fell apart: she was too shattered to be comforted even by these saints.
“Shall I commit sati?” she inquired of them in desperation.
“It is illegal,” they counseled, “but dharma still accrues to a widow who chooses that sacred path.”
“But what will happen to my children?” she cried.
“The scriptures say that your karma will benefit seven generations” they consoled her looking at her daughter (9) and son (7).
This terrible story is, of course, made up. It is intended to help us understand the cultural factors that made Indian/Arabic numerals to sustain an repressive economic system in India while becoming a foundational tool for the amazing development of the West as illustrated by the Widow Fund in Scotland . That Fund began modern insurance and risk management that undergirds contemporary economic life, while secularization or perversion of that wonderful concept of welfare scheme is an important source of the political problems of Europe, Japan, and America.
The Scottish Widow Fund, originally called, “Fund for a Provision for the Widows and Children of the Ministers of the Church of Scotland,” was the first modern, mathematics-based Insurance Company. It provided an innovative, “scientific” alternative to other ways of caring for widows – asylums, lotteries, ponzi schemes, prostitution, starvation, or sati. The Fund, which grew to over £ 100 billion, has served as a midwife to tens of thousands of economic enterprises. It has also supported educational and philanthropic initiatives such as India’s oldest continuously running liberal arts college, the Scottish Church College in Calcutta (1836), and the Scottish orphanage for girls in Mumbai that became Bombay Scottish School (1847). It began a scientific system of risk management that made it possible for people to borrow large amounts of capital to start new ventures across the continents and now into outer space.
The Widow Fund was created by two Calvinist pastors in Scotland, Robert Wallace (1697-1771) and Alexander Webster (1708 – 1784). Both of them were mathematicians and Bible preachers. While we were condemning our upper caste widows in India to life-long solitary confinement, if not to the flames of their husband’s funeral pyres, the pro-life, pro-sex, pro-marriage, pro-widow spirituality of these pastors came together with the best available mathematics to create the world of modern finance.
Unlike our saints who had to renounce their own wives and children, these Protestant pastors were both married because the Bible teaches that the physical world – including human body and sex – are created by a good God who declares them “good.” God does not want godly men to separate from the material realm. He wanted Adam and Eve to become one in order to harness and channel their sexual energy to establish a family that will produce and nurture children to fill the earth and govern it by establishing human culture.  This outlook (worldview) enabled Robert Wallace, who became the Moderator of the Church of Scotland – that is, equivalent of a Sankaracharya or Archbishop – to write a pioneering study, “An Essay on the Principle of Population.”
Like Wallace, Webster also began his career as a minister (pastor) in the Church of Scotland, in Culross in Fife. There he met and married Mary Erskine of Alva. While our sages thought that to be “holy” meant to renounce (take sanyas from) family commitments, Webster’s biblical spirituality freed him to celebrate his romantic and sensual love for his bride:

When I see thee, I love thee, but hearing adore,
I wonder, and think you a woman no more;
Till, mad with admiring, I cannot contain,
And, kissing those lips, find you woman again.

His love for his own wife as well as a deep concern for his friends’ widows motivated him to team up with Wallace and use his training as a mathematician to solve widows’ problems. In 1748, he published hisCalculations, which set forth the scientific principles on which their scheme for widows’ pensions was based. The other mathematical prodigy who helped refine their innovation was Colin MacLaurin who had improved upon Newton’s theories when he was only 14-years old! MacLaurin was himself an orphan who grew up with his uncle – also a pastor. [Note – This article’s author is a Fellow of the MacLaurin Institute at the University of Minnesota named after Prof. Colin MacLaurin.] Unfortunately, MacLaurin died while he was still too young to see the Widow Fund flourish.
In their day, if a minister died, his widow and orphans received a stipend from the church for six months; after that they were on their own. This was unacceptable to these two mathematician-pastors because the Bible told them that “Religion that God our Father accepts as pure and faultless is this: to look after orphans and widows in their distress and to keep oneself from being polluted by the world. (James 1:27)
Wallace gathered and tabulated the available information about pastors’ widows and orphans from all the presbyteries in Scotland. Using the system of actuarial calculation and five other mathematical principles developed in Europe (not in India) the two of them estimated exactly how much premium each pastor would need to contribute to create a fund which would make it possible to (a) take care of the widows, as well as (b) to invest prudently to make the Fund grow. Their calculations, predictions, and investment decisions turned out to be so exact that their system began to be followed by all the insurance companies that came after them. In 1754, Webster published, Zeal for the Civil and Religious Interests of Mankind Commended. His work helps us understand how this milestone in the history of modern finance was a result of civil (scientific) interests, combined with religious (biblical) interests. Webster’s work was of such high quality that in 1755, the government commissioned him to obtain data for the first census of Scotland.
The Wallace-Webster financial innovation succeeded because of another cultural ingredient – the democratic structure of the Scottish Church. The Greek philosopher Plato (429-347 BC) had condemned democracy as the worst of all political systems. That is why the spread of Greek culture, called hellenization, did not stir a desire for democracy in the ancient world.
It was the Protestant Reformation’s return to the Bible which birthed “modern” democracy in the Scottish church (and the Republican system of government in America). Reforming the church included replacing the autocratic rule of bishops and popes by the rule of democratically elected elders. The reformers followed the New Testament pattern of elders governing local churches. In appointing elders to manage church-affairs and finances, Christ’s apostles, in turn, followed an Old Testament pattern. After delivering the Hebrews (Jews) from their slavery in Egypt, God instructed Moses to ask the twelve tribes to “Choose some wise, understanding, and respected men from your tribes, and I will set them over you.  . . So, (MOSES) took the leading men of your tribes, wise and respected men, and appointed them to have authority over you.” (Deuteronomy 1: 13-15)  The people chose their leaders and through Moses (and later through the apostles) God anointed them. Protestant nations applied this “democratic” idea to nation-states only because it succeeded in reforming the church.
“The voice of the people” can be “the voice of God” only if the people grow in their knowledge of God and if their character becomes godly. If the people are corrupt then their voice becomes the voice of the devil. This, as we shall see, is the problem now facing secularized democratic nations in the West. Far too many people in these nations no longer want to take the responsibility to work, earn, save, wisely invest, and take care of their neighbors, widows, orphans, refugees, and other victims of natural or man-made evils. They want their governments to tax or borrow from productive people and spend it on their welfare.
Why did the Church’s “Widow’s Fund” became an enormous commercial success? Why was a fund meant for helpless widows and orphans invested wisely, not mismanaged or looted by corrupt businessmen or squandered by politicians and bureaucrats? It was because on May 12, 1743 Wallace was elected the Moderator of the General Assembly of the Church of Scotland. The Assembly approved his scheme. That enabled him to submit it to the Lord-Advocate in London, who framed it into a legislative measure and superintended its safe progress into an Act. The democratic milieu was critical for the Fund’s success because the Presbyterian structure of the Scottish Church simultaneously cultivated godly character and nurtured grassroots democracy – ordinary church members elected wise and God-fearing elders and held them accountable; the elders elected presbyteries; which elected Synods, The General Assembly, as well as the Moderator. The Widow Fund succeeded not simply because of Mathematics but also because (a) the biblical spirituality nurtured honest, productive, compassionate, and public-spirited character, (b) the Bible’s emphasis on human sinfulness required institutionalizing accountability even among religious leaders, and (c) the biblically derived idea of local church-based grassroots democracy promoted responsible leadership all the way to the top. Wallace was elected, not because he bribed, bullied, or manipulated voters, but because he came up with a scheme that made compelling sense, as did Joseph in the book of Genesis who saved Egypt and its surrounding nations from seven-year long spell of drought and famine.
The foregoing may be hard for Indians to believe because they know that many denominational Churches in India, established by Western churches and handed over to Indian Christians, are as corrupt now as our public institutions. These skeptics may change their mind if they look at a typical Bible based local church in India (or a genuine all-India organization such as the Union of Evangelical Students of India) that is built or run mainly by contributions from its members. Denominations such as the Church of North India, Church of South India, or the Methodist Church of India tend to be corrupt because their wealth does not come from their members. A genuine biblical church, however, is inherently different from a typical Hindu temple. A devotee who goes to worship in a temple and donates money is not a “member” of that temple. He has no authority to scrutinize its accounts. In theory, the government can scrutinize a temple’s account. In practice, however, our wealthy gurus and temples have learnt the art of keeping politicians and administrators in their pockets. In contrast to our Indian religious establishments, in the democratically organized Scottish church, the donor was a member: he elected the elders and the treasurer; he approved or disapproved the budget.
Of course, there were plenty of sinful Protestants; and corrupt people always seek to control public funds. The Presbyterian structure, however, was designed for sinful people. It sought to make them godly but also instituted wise structures to minimize the abuse of public funds. Transparency of institutions and rules that governed the church and the Widow’s fund as well as public knowledge of the private lives of the church leaders helped generate the trust that ensured the Fund’s success.
It also helped that the original 930 contributors to the Fund were all pastors and that the Fund was created to look after their wives and children. They were among the most learned and public-spirited members of the community. They understood the rules and helped refine and enforce them. Success of democratic institutions depends on the knowledge and character of its members. For example, many attempts to establish medical insurance companies in India have failed (in spite of our mathematical aptitude) because the poor character of participating members, doctors, pharmacists, agents, and their lawyers. If insurance money is claimed for diseases that do not exist and procedures that have not been performed, then the calculations behind premiums become meaningless.
The Widow’s Fund was a wonderful “welfare” scheme. It was a capitalistic or free-market enterprise. It operated under the law of the land, but was neither controlled by politicians nor run by bureaucrats. Why did deeply religious men multiply the Fund’s capital through wise business investments? Why didn’t they take sannyas from money making? They made money because they followed the Lord Jesus who, in the spirit of the Old Testament, commended such economic stewardship – turning 5 bags of gold into 10 – as true spirituality (Matthew 25:15-17). People joined the Fund because they trusted their community leaders with their money and their trust was not betrayed. Today the Fund is completely secular and it is not growing as it used to.
The Fund’s initial success in taking small amounts of money from lots of simple people and taking care of their families had profound impact on global politics. It tempted politicians to imitate it and turn entire nations into welfare states. This political attempt began in Germany with Otto van Bismark’s social insurance legislation in 1880 and soon spread to Europe, USSR, Japan, and the USA, both by the so called “Right” and even more by the “Left,” that is, by Socialist or Communist parties.
The idea was good: the state will take wealth from those who created it and use it to take care of everyone from cradle to the grave. Taking citizens’ wealth was, of course, easy. Governments, however, are not structured to use other people’s money to create wealth. Unscrupulous and arrogant rulers use public funds for their glory. They waste money even if they don’t actually loot it. The worst part is that when a welfare state seems to succeed, it destroys citizens’ character. That, for example, is one of Japan’s problems today. It took the concept of welfare state farther than any European nation . . . but if the state is going to take care of you from birth to death, why would you take the trouble to bring up children and nurture your own family? Japanese did not lose interest in sex – the Ten Commandments that included “you shall not covet your neighbors wife” and “you shall not commit adultery” were not moral absolutes in Japanese culture to begin with – and the idea of a secular welfare state took away the need to take the trouble to harness sexual energy to build families that will produce and nurture children. As a result, Japan’s population has been declining. That means that the number of citizens who will work and pay tax is diminishing. That is unsuitable for states’ welfare schemes that are ponzi schemes, dependent on more and more people working, earning, and paying taxes to support retired people and those who no longer have the ability or willingness to hold down a job.
Governments of Europe and America have followed the same folly: the welfare state undermined the Ten Commandment that required children “To honor your father and mother.” Mothers began to abort their babies, fathers began to abandon their wives and children in favor of other women, and taking care of the elderly became the responsibility of the state. This gigantic social experiment to live without God’s law is backfiring now since the so-called welfare state has replaced the “Protestant work-ethic,” that created the modern economic miracle with a secular “Entitlement-culture.” This culture believes that citizens (and illegal aliens) have the right to this, that, and the other but no corresponding obligation to create wealth to look after themselves, their families, and their neighbors – especially widows, orphans, refugees and other poor.
We are “Backward” because while India had and has mathematical genius, our culture lacks a spirituality that promotes the creation of wealth and a passion to use wealth to love our neighbors as ourselves. We have now learned western mathematics and their application to economics, but in order to move FORWARD we also need to avoid the follies of western secularism and discover the forgotten spiritual secrets of Western civilization.
NOTES
This series of articles will soon be published as a book in India in Hindi and English.
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