At Ambit, we spend a lot of time reading articles that cover a wide gamut of topics, including investment analysis, psychology, science, technology, philosophy, etc. We have been sharing our favourite reads with clients under our weekly ‘Ten Interesting Things’ product. Some of the most interesting topics covered in this week’s iteration are related to ‘the dying art of disagreement’, ‘the secrets of deep learning’ and ‘how CRISPR allows butterfly wing editing’.Here are the ten most interesting pieces that we read this week, ended September 29, 2017:1) CEOs and investors should beware the curse of authorship
[Source: Financial Times
Investment legend Ray Dalio recently published “Principles: Life and work”. Investors in the firm he founded, Bridgewater, and investors more broadly, are likely to take note of this book since Bridgewater is, by a country mile, the largest hedge fund in the world. Chief executives’ books can be powerful contrarian indicators. “Jack”, former General Electric chief Jack Welch’s memoir, marked the top for that corporation. Now, 16 years after publication, the company’s stock trades at less than half of its peak value. More recently, “Conscious Capitalism”, Whole Foods Market co-founder John Mackey’s opus on “higher purpose, stakeholder integration, conscious leadership, and conscious culture and management” preceded a final stock price surge in 2013. Before rumours of Amazon’s interest in the company started to circulate, Whole Foods’ shares had lost almost 60% of their value.When an executive thinks he or she not only has the material, but also the time, to write a substantive book — and agents and publishers believe there is a wide, mainstream audience for it, sentiment must be soaring. Neither a powerful business leader nor a major publisher is going to move forward unless each is certain of success: the investment is high. Whether financial gain or prestige, there must be a clear pay-off. That kind of certainty only exists near extreme peaks in confidence. Unlike magazine cover stories, also frequently strong contrarian indicators of sentiment, books involve long lead-times and large resource commitments. As a result, like speculative stock investors, the participants must be certain their gamble will pay off well into the future. That gamble, though, requires a broad audience. CEO writers must be well-known and well-respected. In a crowded publishing world, their names must immediately generate not just interest, but enthusiasm.
To be fair, not all CEO books have been good contrarian indicators. Howard Schultz of Starbucks and Sheryl Sandberg of Facebook both defy the trend. Ms. Sandberg’s best-selling “Lean In” preceded a six-fold increase in Facebook stock. That said, her latest book, “Option B”, about overcoming adversity has all the signs of a peak-in-confidence text, as it stretches Ms. Sandberg’s perceived expertise well beyond the business world. At the top, it seems there is nothing a successful executive cannot handle masterfully.
The author shares a similar concern with Ray Dalio’s book as well. It has little to say about investing, which is Bridgewater’s core business and would appear to be his greatest skill. Instead, it focuses on the “unconventional principles that helped him create unique results in life and business — and which any person or organisation can adopt to better achieve their goals”. When CEOs believe their “principles” can help “anyone” to “achieve their goals”, hubris has set in.2) The dying art of disagreement
[Source: NY Times
To say the words, “I agree” — whether it’s agreeing to join an organisation, or submit to a political authority, or subscribe to a religious faith — may be the basis of every community. But to say, I disagree; I refuse; you’re wrong; these are the words that define our individuality, give us our freedom, enjoin our tolerance, enlarge our perspectives, seize our attention, energize our progress, make our democracies real, and give hope and courage to oppressed people everywhere. However, we are failing at the task of disagreeing. We disagree about racial issues, bathroom policies, healthcare laws, and, of course, the 45th US president. We express our disagreements in radio and cable TV rants in ways that are increasingly virulent; street and campus protests that are increasingly violent; and personal conversations that are increasingly embittering. Nowadays, we judge one another morally depending on where we stand politically. The polarization is geographic, personal, electronic and digital. We no longer just have our own opinions. We also have our separate “facts,” often the result of what different media outlets consider newsworthy. Unlike in the past, our disagreements today rarely sharpen our thinking, much less change our minds.
In 1987, Allan Bloom, a philosophy professor at the University of Chicago published a learned polemic “The Closing of the American Mind” about the state of higher education in the United States. He’d read books of earlier times that raised serious questions about the human condition, and which invited to attempt to ask serious questions. Education, in this sense, wasn’t a “teaching” with any fixed lesson. It was an exercise in interrogation. It used to be called liberal education. The University of Chicago showed that every great idea is just a spectacular disagreement with some other great idea. Socrates quarrels with Homer. Aristotle quarrels with Plato. Locke quarrels with Hobbes and Rousseau quarrels with them both. These quarrels are never personal or political. Also, these are never based on a misunderstanding. In fact, disagreements arise from perfect comprehension. To disagree well you need to first understand. The idea of open-mindedness can’t simply be a catchphrase or a dogma. It needs to be a personal habit, most of all when it comes to preserving an open mind toward those with whom we disagree.
This habit wasn’t being exercised 30 years ago. And if you’ve followed the news from American campuses in recent years, things have become a lot worse. According to a new survey from the Brookings Institution, a plurality of college students today, 44%, do not believe the First Amendment to the U.S. Constitution protects the so-called “hate speech,” when of course it absolutely does. More shockingly, a narrow majority of students, 51%, think it is “acceptable” for a student group to shout down a speaker with whom they disagree. An astonishing 20% also agree that it’s acceptable to use violence to prevent a speaker from speaking. Organised groups of hecklers shout at the speakers, and sometimes create violence. The mis-education continues in grade school and colleges. As the Brookings findings indicate, younger Americans seem to have no grasp of what the First Amendment says, much less of the kind of speech it protects. This is a testimony to the collapse of civics education in the United States, creating the conditions that make young people uniquely susceptible to demagogy of the left- or right-wing varieties.
Intelligent disagreement is the lifeblood of any thriving society. Yet in the United States (and is increasingly visible in India), the younger generation is never taught either the how or the why of disagreement. They seem to think that free speech is a one-way right: namely, their right to disinvite, shout down or abuse anyone they dislike. The results are evident in the parlous state of American universities, and the frayed edges of our democracies. Yes, we disagree constantly. But what makes our disagreements so toxic is that we refuse to make eye contact with our opponents, or try to see things as they might, or find some middle ground. Instead, we fight each other from the safe distance of our separate islands of ideology and identity and listen intently to echoes of ourselves. 3) Scientists discover gold literally on trees in the outback
Money might not grow on trees, but scientists have confirmed that gold is found in the leaves of some plants. Scientists from Australia’s national science agency, the Commonwealth Scientific and Industrial Research Organisation (CSIRO), have proved that the leaves of certain eucalyptus trees contain minute amounts of the precious metal that have been naturally absorbed. Eucalyptus in the Kalgoorlie region of Western Australia and the Eyonre Peninsula in South Australia are drawing up water containing gold particles from the earth via their roots and depositing it in their leaves and branches. One of the authors of the paper, the CSIRO geochemist Dr. Mel Lintern, said some eucalyptus root systems dived down deeper than 30 metre, through much of the sediment that sits on top of solid ore-bearing rock. The tree acts “as a hydraulic pump… drawing up water containing the gold”, he said. “As the gold is likely to be toxic to the plant, it is moved to the leaves and branches where it can be released or shed to the ground.”
The scientists have known from their laboratory experiments that trees have the ability to absorb gold but this is the first time they have proved that it is actually happening in nature. The particles of gold in the trees are tiny, about one-fifth the diameter of a human hair, and invisible to the human eye. The CSIRO used its advanced x-ray imaging capability at the Australian Synchrotron in Melbourne to locate and see the gold in the leaves. Despite the size of the particles, the CSIRO said the discovery could offer an opportunity for mineral exploration, as the presence of gold at the surface could indicate gold ore deposits buried tens of metres underground.
“The leaves could be used in combination with other tools as a more cost-effective and environmentally-friendly exploration technique," Lintern said. "By sampling and analysing vegetation for traces of minerals, we may get an idea of what's happening below the surface without the need to drill. It's a more targeted way of searching for minerals that reduces costs and impact on the environment. "Eucalyptus trees are so common that this technique could be widely applied across Australia. It could also be used to find other metals, such as zinc and copper."4) New theory cracks open the black box of deep learning
Last month, Naftali Tishby, a computer scientist and neuroscientist from the Hebrew University of Jerusalem, presented evidence in support of a new theory explaining how deep learning works. Tishby argues that deep neural networks learn according to a procedure called the “information bottleneck,” which he and two collaborators first described in purely theoretical terms in 1999. The idea is that a network rids noisy input data of extraneous details as if by squeezing the information through a bottleneck, retaining only the features most relevant to general concepts. Tishby’s findings have the AI community buzzing. Geoffrey Hinton, a pioneer of deep learning who works at Google and the University of Toronto, emailed Tishby after watching his Berlin talk. “It’s extremely interesting,” Hinton wrote. “I have to listen to it another 10,000 times to really understand it, but it’s very rare nowadays to hear a talk with a really original idea in it that may be the answer to a really major puzzle.”
According to Tishby, who views the information bottleneck as a fundamental principle behind learning, whether you’re an algorithm, a housefly, a conscious being, or a physics calculation of emergent behavior, that long-awaited answer “is that the most important part of learning is actually forgetting.” During his research Tishby was thinking about how good humans are at speech recognition. He realised that the crux of the issue was the question of relevance: What are the most relevant features of a spoken word, and how do we tease these out from the variables that accompany them, such as accents, mumbling and intonation? In general, when we face the sea of data that is reality, which signals do we keep? He used information theory to define ‘relevant’ in a precise sense. Imagine X is a complex data set, like the pixels of a dog photo, and Y is a simpler variable represented by those data, like the word “dog.” You can capture all the “relevant” information in X about Y by compressing X as much as you can without losing the ability to predict Y.
In the case of neural networks, each time the training data are fed into the network, a cascade of firing activity sweeps upward through the layers of artificial neurons. When the signal reaches the top layer, the final firing pattern can be compared to the correct label for the image — 1 or 0, “dog” or “no dog.” Any differences between this firing pattern and the correct pattern are “back-propagated” down the layers, meaning that, like a teacher correcting an exam, the algorithm strengthens or weakens each connection to make the network layer better at producing the correct output signal. In their experiments, Tishby tracked how much information each layer of a deep neural network retained about the input data and how much information each one retained about the output label. The scientists found that, layer by layer, the networks converged to the information bottleneck theoretical bound. At the bound, the network has compressed the input as much as possible without sacrificing the ability to accurately predict its label.
Tishby made the intriguing discovery that deep learning proceeds in two phases: a short “fitting” phase, during which the network learns to label its training data, and a much longer “compression” phase, during which it becomes good at generalisation, as measured by its performance at labeling new test data. As a deep neural network tweaks its connections, at first the number of bits it stores about the input data stays roughly constant or increases slightly as connections adjust to encode patterns in the input. The network then gets good at fitting labels to it. Some experts have compared this phase to memorisation. Then learning switches to the compression phase. The network starts to shed information about the input data, keeping track of only the strongest features — those correlations that are most relevant to the output label. As an example, some photos of dogs might have houses in the background, while others don’t. As a network cycles through these training photos, it might “forget” the correlation between houses and dogs in some photos as other photos counteract it. It’s this forgetting of specifics that enables the system to form general concepts.5) Scientists can now repaint butterfly wings
[Source: The Atlantic
Using the revolutionary gene-editing technique known as CRISPR, Robert Reed’s team at Cornell University recently created a black and silver winged butterfly from Gulf fritillary—a bright-orange species with a few tigerlike stripes. And by performing the same feat across several butterfly species, the team showed that just one gene, known as optix, controls all kinds of butterfly patterns. Red becomes black. Matte becomes shiny. Another gene, known as WntA, produces even wilder variations when it’s deleted. Eyespots disappear. Boundaries shift. Stripes blur. These experiments prove what earlier studies had suggested—that optix and WntA are “paintbrush genes,” says Anyi Mazo-Vargas, one of Reed’s students. “Wherever you put them, you’ll have a pattern.”
Biologists have long been smitten by butterflies. These insects are perfect subjects for addressing two of the most fundamental questions in the study of evolution. First, where do new things come from? Butterflies all evolved from a moth ancestor, so how did a presumably dull-winged insect give rise to a kaleidoscopic dynasty of some 18,000 species, each with a distinctive pattern of colours and shapes plastered on its wings? Also, what are the genes behind these patterns? How did a limited set of DNA come to produce patterns of such astonishing diversity and often-baffling complexity? Many scientists, Reed included, have addressed that second question. They identified a handful of pattern-defining genes, with colourful names like optix, doublesex, and cortex which led to beautiful patterns on wings. “It was convincing but we didn’t know exactly what these genes were doing,” says Reed. Without the ability to delete the genes, and see if their absence changed the butterfly wings, they didn’t have the final proof.
CRISPR changed everything. This technique, used by bacteria for billions of years and harnessed by scientists in the last five, allows researchers to cut and edit DNA far more easily and precisely than ever before. They’ve used CRISPR to probe the weaknesses of cancer cells, study how bodies are built, and to learn how our feet evolved from fishy fins. And Reed has used it to finally do the gene-deleting experiments that had long eluded him. By deleting the optix gene in a wide variety of butterflies, team member Linlin Zhang showed that red parts of the wing consistently turn black. The Gulf fritillary transforms from a vivid orange insect into a dark inky one. The small postman loses the vivid red streaks on its hind wings. And the painted lady loses its complex psychedelic patterns and becomes almost monochrome.
These butterfly experiments reveal evolution’s penchant for both conformity and innovation. For example, optix does the same thing in species that have been separated by at least 80 million years of evolution. But different species deploy it in different ways to produce their own distinctive patterns. If optix is a paintbrush, then other genes act as the painter’s hands, determining where the brush will go, and yet other genes act as the paints, determining which colours the brush eventually lays down. All of this can be easily rewired, producing a wide kaleidoscope of patterns from the same basic toolkit.6) The neuroscience of your brain on fiction
[Source: NY Times
Brain scans are revealing what happens in our heads when we read a detailed description, an evocative metaphor or an emotional exchange between characters. Stories, neuroscience shows, stimulate the brain and even change how we act in life. Researchers have long known that the “classical” language regions, like Broca’s area and Wernicke’s area, are involved in how the brain interprets written words. What scientists have come to realise in the last few years is that narratives activate many other parts of our brains as well, suggesting why the experience of reading can feel so alive. Words like “lavender,” “cinnamon” and “soap,” for example, elicit a response not only from the language-processing areas of our brains, but also those devoted to dealing with smells. Last month, a team of researchers from Emory University reported in Brain & Language that when subjects in their laboratory read a metaphor involving texture, the sensory cortex, responsible for perceiving texture through touch, became active. Researchers have discovered that words describing motion also stimulate regions of the brain distinct from language-processing areas.
The brain, it seems, does not make much of a distinction between reading about an experience and encountering it in real life; in each case, the same neurological regions are stimulated. Keith Oatley, an emeritus professor of cognitive psychology at the University of Toronto, has proposed that reading produces a vivid simulation of reality, one that “runs on minds of readers just as computer simulations run on computers.” Fiction — with its redolent details, imaginative metaphors and attentive descriptions of people and their actions, offers an especially rich replica. Indeed, in one respect novels go beyond simulating reality to give readers an experience unavailable off the page: the opportunity to enter fully into other people’s thoughts and feelings.
Raymond Mar, a psychologist at York University in Canada, performed an analysis of 86 fMRI studies, published last year in the Annual Review of Psychology, and concluded that there was substantial overlap in the brain networks used to understand stories and the networks used to navigate interactions with other individuals — in particular, interactions in which we’re trying to figure out the thoughts and feelings of others. Scientists call this capacity of the brain to construct a map of other people’s intentions “theory of mind.” Narratives offer a unique opportunity to engage this capacity, as we identify with characters’ longings and frustrations, guess at their hidden motives and track their encounters with friends and enemies, neighbors and lovers.
Dr. Oatley and Dr. Mar, in collaboration with several other scientists, reported in two studies, published in 2006 and 2009, that individuals who frequently read fiction seem to be better able to understand other people, empathize with them and see the world from their perspective. This relationship persisted even after the researchers accounted for the possibility that more empathetic individuals might prefer reading novels. Fiction, Dr. Oatley notes, “is a particularly useful simulation because negotiating the social world effectively is extremely tricky, requiring us to weigh up myriad interacting instances of cause and effect. Just as computer simulations can help us get to grips with complex problems such as flying a plane or forecasting the weather, so novels, stories and dramas can help us understand the complexities of social life.”7) Why advertisers need to be wary of the false consensus effect
Imagine you’re driving in a 20mph zone when you’re flagged down by a policeman. He’s caught you driving at 35mph on his speed gun, so he issues you with a £50 on-the-spot fine. Once you reach home you realize his report is riddled with errors, such as the make of your car and the road you were on. This gives you a good chance of being able to appeal successfully. What would you do? Would you contest or accept the fine? Once you’ve decided what you’re going to do, the author throws another question; what do you think most people would do in the same situation? Contest or accept? If you’re like the 320 students interviewed by Lee Ross, a psychologist at Stanford University, you’ll assume that the majority will make the same decision as you – whatever that decision is. According to Ross, “The person who feeds squirrels, votes Republican or drinks Drambuie for breakfast will see such behaviour as relatively common”. He termed this the false consensus effect.
So how does this “effect” affect the brands? It is a problem for brands, as marketers and agency folk differ from their consumers. The key difference is that they are, in Nobel Laureate and psychologist at Carnegie Mellon Herbert Simon’s words, maximisers not satisficers. Maximiser describes people who spend considerable time and effort finding the ideal product in a particular category. Satisficers are those who will settle for the first product that meets their criteria. Most marketers are maximisers in their category, while most consumers are satisficers. As Rory Sutherland said, “The vast bulk of the money in any market at any time is in the hands of the satisficers. People who want to meld with a peer group, not to outdo it, and people who are more eager to avoid social embarrassment or regret, including purchase mistakes, than they are to display dominance.”
The effect suggests that marketers assume consumers are maximisers and create ads accordingly. This leads to attempts to persuade people that their product is perfect rather than reassuring them it won’t be crap. Striving to convey perfection often leads to a focus on intricate detail irrelevant to most. In contrast, reassurance comes from stressing the popularity of a brand, whether directly or by investing in high profile, seemingly wasteful displays of advertising that only the most profitable companies can afford. Brands need to decide whether their audience are maximisers or satisficers and communicate accordingly.8) Soros hatred is a global sickness
[Source: Financial Times
Since the beginning of 2017, George Soros has faked a chemical attack in Syria, funded anti-Trump marches in Washington, came up with the “Soros plan” to flood Hungary with refugees, forced a change of government in Macedonia, undermined the Israeli prime minister and got several key White House aides sacked. Not bad for a man of 87. All of the above are, of course, conspiracy theories. But the fact that they have surfaced this year — and all feature the name of Mr. Soros, is not just a curiosity. It says something important and worrying about the global politics. In the 1990s, Mr. Soros was in tune with the spirit of the age, as he used the billions he had made in finance to support the transition to democracy in post-communist Europe and elsewhere. But now the global political climate has changed and liberal ideas are in retreat. For a new generation of nationalists, Mr. Soros has become the perfect villain. He is an internationalist in an age of nationalism. He is a supporter of individual rights. He is super rich and is also Jewish - thus easily cast in the role of the shadowy and manipulative international financier.
In 1989, one of the beneficiaries of a Soros scholarship to study at Oxford was a young Hungarian activist named Viktor Orban. Today, the same Mr. Orban is the prime minister of Hungary and demonises his one-time benefactor. The Hungarian leader has made denunciation of an alleged “Soros plan” to flood Hungary with Muslims central to his re-election campaign. There is no such plan. What is true is that Mr. Soros is a generous backer of refugee charities and has also supported the EU’s plan to resettle Syrian refugees across the bloc, including in Hungary. That was the excuse enough for Mr. Orban to plaster the country with posters featuring a grinning Mr. Soros, and urging: “Don’t let Soros have the last laugh.”
The demonisation of Mr. Soros in Hungary, where he was born, is not an isolated case. In the past year, he has been denounced by political leaders in Macedonia, Poland, Romania and Turkey, all of whom claim he is plotting against them. The paranoid right in America also churns out anti-Soros material. As long ago as 2007, Mr. Soros was denounced on Fox News as the “Dr. Evil of the whole world of leftwing foundations”. The origins of Soros-hatred in the USA may date back to his opposition to the Iraq war. His support of liberal causes in the USA, as well as of international institutions, such as the UN, has kept the far-right pot boiling. There is clearly an echo-chamber element to the anti-Soros campaigns around the world, as far-right groups pick up on the same conspiracy theories. But some strongman leaders have more concrete reasons to fear Mr. Soros’s Open Society Foundation, which funds civil society organisations that promote education, a free press, minority rights and anti-corruption initiatives. In 2015, Vladimir Putin’s Government chucked the Open Society Foundation out of Russia since it was no longer willing to tolerate the latter’s support for organisations, such as Memorial, which promoted research into the Soviet terror.
Mr. Soros’s activities have even made him a target in Israel. The obvious anti-Semitism in many of the anti-Soros campaigns around the world evidently matters less to the Netanyahu Government than Mr. Soros’s support for Palestinian rights and other causes unpopular on the Israeli right. There is also a personal element in Prime Minister Benjamin Netanyahu’s anti-Soros ire. As an anti-corruption probe has got closer and closer to Israel’s first family, so they have lashed out against Mr. Soros. Yair Netanyahu, the prime minister’s son, complained recently that the “Fund for the Destruction of Israel, funded by Soros and the European Union, is threatening me”. He even re-published a cartoon of Mr. Soros dangling the world in front of a reptilian creature, the kind of image that his father would routinely denounce as anti-Semitic if it had been published by another source.9) Sometimes, thinking is a bad idea
Roger Federer’s inability to win Grand Slams in the last two years hasn’t been due to physical decline so much as a new mental frailty that emerges at crucial moments. In the jargon of sport, he has been “choking”. This, say the experts, is caused by thinking too much. When a footballer misses a penalty or a golfer fluffs a putt, it is because they have become self-conscious. By thinking too hard, they lose the fluid physical grace required to succeed. The opposite of this effect is ‘unthinking’. Unthinking is the ability to apply years of learning at the crucial moment by removing your thinking self from the equation. Its power is not confined to sport: actors and musicians know about it too, and are apt to say that their best work happens in a kind of trance. Thinking too much can kill not just physical performance but mental inspiration.
In less dramatic ways the same principle applies to all of us. A fundamental paradox of human psychology is that thinking can be bad for us. When we follow our own thoughts too closely, we can lose our bearings, as our inner chatter drowns out common sense. A study of shopping behaviour found that the less information people were given about a brand of jam, the better the choice they made. When offered details of ingredients, they got befuddled by their options and ended up choosing a jam they didn’t like. If a rat is faced with a puzzle in which food is placed on its left 60% of the time and on the right 40% of the time, it will quickly deduce that the left side is more rewarding, and head there every time, thus achieving a 60% success rate. Young children adopt the same strategy. When Yale undergraduates play the game, they try to figure out some underlying pattern, and end up doing worse than the rat or the child. We really can be too clever for our own good.
By allowing ourselves to listen to our (better) instincts, we can tap into a kind of compressed wisdom. The psychologist Gerd Gigerenzer argues that much of our behaviour is based on deceptively sophisticated rules-of-thumb, or “heuristics”. A robot programmed to chase and catch a ball would need to compute a series of complex differential equations to track the ball’s trajectory. But baseball players do so by instinctively following simple rules: run in the right general direction, and adjust your speed to keep a constant angle between eye and ball. To make good decisions in a complex world, Gigerenzer says, you have to be skilled at ignoring information. He found that a portfolio of stocks picked by people he interviewed in the street did better than those chosen by experts. The pedestrians were using the “recognition heuristic”: they picked companies they’d heard of, which was a better guide to future success than any analysis of price-earning ratios.
The higher the stakes, the more overthinking is a problem. Ed Smith, a cricketer and author of “Luck”, uses the analogy of walking along a kerbstone: easy enough, but what if there was a hundred-foot drop to the street—every step would be a trial. In high-performance fields it’s the older and more successful performers who are most prone to choke, because expectation is piled upon them. How do you learn to unthink then? The only reliable cure for overthinking seems to be enjoyment, something that both success and analysis can dull. Experienced athletes and artists often complain that they have lost touch with what made them love what they do in the first place. Thinking about it is a poor substitute. We live in age of self-reflection, analysing every aspect of our work, micro-commentating on our own lives online, reading articles urging us to ponder what makes us happy. Much of this may be worthwhile, but we also need to put thinking in its place.10) Obituary: Edith Windsor: Irrepressible campaigner for American equality
[Source: Financial Times
Edith Windsor was a gay rights activist and LGBT pioneer whose landmark legal battle paved the way for the eventual legalisation of same-sex marriage in the USA. “Few were as small in stature as Edie Windsor,” former US president Barack Obama wrote in a tribute this week, “and few made as big a difference to America.” Just five feet tall, the octogenarian Windsor, who has died aged 88, sued the US after being landed with a tax bill of hundreds of thousands of dollars following the death of her wife, Thea Spyer, in 2009. Engaged for 40 years, Windsor and Spyer, a psychologist, finally married in Canada in 2007. Because their marriage was not recognised under the US federal law, Windsor was ineligible for any of the 1,000-plus federal benefits offered to married heterosexuals. It meant that Windsor was left owing the authorities more than $600,000 in taxes after Spyer’s death. Windsor initially went to court to secure a refund. Later she sued the federal government, and her case hinged on the fact that as the law at the time only recognised heterosexual marriages, same-sex married partners were unconstitutionally targeted for “differential treatment”.
The hurdle was the Defense of Marriage Act (Doma), signed into law by President Bill Clinton in 1996. Section 3 of the act defined marriage as “a legal union between one man and one woman as husband and wife”. The challenge was to convince the judges, initially at the US District Court for the Southern District of New York that the term “spouse” could, and should, apply equally to same-sex partners. On June 6, 2012, the court ruled in Windsor’s favour and ordered the federal government to refund the tax. Under the ruling, same-sex couples gained federal recognition for the first time. The case went to appeal, but the US Court of Appeals in New York voted 2:1 to affirm the decision of the district court. Following a further move to test the ruling, in 2013 the Supreme Court finally voted in a 5:4 majority to declare Section 3 of Doma unconstitutional “as a deprivation of the liberty of the person protected by the Fifth Amendment”. Under the ruling, same-sex couples gained federal recognition for the first time, although only in 13 states and the District of Columbia. Two years later in a broader ruling, the Supreme Court held that same-sex couples were to be accorded a constitutional guarantee of marriage equality across the US.
The irrepressible Windsor went on to became a national hero, much loved by gay campaigners and Middle America alike, losing out to Pope Francis for Time’s person of the year in 2013. - Saurabh Mukherjea is CEO (Institutional Equities) and Prashant Mittal is Analyst (Strategy and Derivatives) at Ambit Capital Pvt Ltd. Views expressed are personal.