I was over at IIMC for a conference a couple of days ago. I was returning to the campus long years after I had graduated. It was, as you might expect, an emotional moment, if not exactly in the same league as General Douglas McArthur's triumphant return to the Philippines in World War II.
Kolkata has changed although not as much as you would have thought. The airport is thoroughly modern and pleasing. From the airport to Joka (where IIMC is located), there is now a road that bypasses the city initially and joins at Park Street. The ride for the first thirty minutes or so via Rajarhat is exhilarating. It's a two-lane road dotted with greenery on the divider and a pleasing mix of empty spaces and buildings on both sides. There are the exquisite buildings one would associate with the IT sector and even a Finance Centre along the route. Open spaces are making way for mutli-storied apartment complexes. Hmmm, you tell yourself, Kolkata has changed for the better.
Park Street pulls you up short. The buildings and eating joints, rickety and worn, might belong to the time I spent in the city as a student. Alipore, the locality of the old aristocracy, retains its majesty with plenty of greenery, imposing mansions and the National Library. Further down at Behala, you return to the past. There are more buildings and the odd attractive one but the locality as a whole remains as rundown as it used to be. Next come Behala Chowrasta, Shakar Bazar and Thakurpukur. Again, the years seem to have largely passed them by. I pass buses with see people hanging to the straps. I recall my days on these crowded buses (mostly, 12 C) but, in those days, one thought it fun.
Finally, the IIMC campus. Near the main entrance is an unsettling sight, an open sewer on either side of the pathway leading into the campus. I experience a thrill as I cross the arched entrance with the Institute's name inscribed on it. Once you enter the campus, the transformation is real and substantial. In my student days, you had a set of four hostels separated from the main building by a lake, barracks that served as a library and a some staff quarters in the distance. Otherwise, the entire campus was open and wild.
Now, you are first greeted by an executive complex called Tata Hall. Then comes our set of hostels, now called Ramanujam Hostel. H1 and H2 are entirely for girls (in our time, it was just the top floor of H1). Further on, more hostels (including a Tagore Hall) and a cafeteria. You keep going past wild shrubbery and then you begin to see the real development. A whole set of spanking new hostels and another executive complex (where I stayed), all overlooking the lake. The executive building is still under construction and the mess is yet to come up.
I check in and head for Tata Hall for lunch. Then, I make my way to the main building via the narrow road that skirts the lake. The lake itself is ringed by trees now, which is a pleasing sight but you no longer have an unobstructed view of the lake. I cross an imposing white-coloured building, the new library building and am soon face to face with a multi-storied building. Our 'main building' is no longer that. Classes are held in the new building, which also has faculty rooms.
I search for our 'main building'. I have difficulty in getting my bearings. On the road from the hostel, you turned right, as I recall. I think I have located the 'main building' of our time- it's now called L1, L2, L3 (somebody please correct me if I got it wrong). There is also a Computer Science Center. Behind the office buildings are a complex for the PGP Executive programme and faculty and staff housing quarters. I feel a surge of pride. Unlike much of the city I just passed through, IIMC shows visible and substantial change.
After the conference, I retrace my steps. Tata Hall is not up to scratch. It's run down, the dining room is dingy and depressing, there are signs of peeling plaster, the building is standard PWD stuff, not something one associates with a top business school. The food was mediocre (and I say this as somebody who is hardly a foodie).
One thing is striking. The employees look emaciated and are poorly dressed. They are helpful, almost eager to please. Suffering is writ large on their faces. That is the impression I carried away from my student days. I'm distressed that this too has not changed. How come? Are these contract employees who are under-paid? They should do a lot better on current government pay scales.
I head for my old hostel. It's exactly as it was. The low entrance, the hostel office to the left, the dining room right ahead, the common room to the right. There are a couple of changes. To the left as you enter is a table with a watchman sitting behind it. The common room has shrunk and has only the table-tennis and billiards tables. The sofas with papers and magazines- they don't seem to be around. At the mess itself, time has stood still. Two rows of tables, about 14 or so in all. The cafeteria outside, run in the old days by the reliable Keshavan, has changed but very slightly. More beverages than before. I ask for a bottle of rose milk. "Shaab, change ho ga?". I cough up most of the coins I have.
I wind my way through the corridors to H-4. I climb up the staircase (I recall I used to scamper up and down at least half a dozen times every day, now it's a measured tread). At the landing of H-4, I turn left and head towards the end. Ah,there's my room. It used to be 207, now it's labelled 309.
I lean against the railing and survey the floor. Right ahead to the right were Mohan Krishnan and Talwar. At the landing itself, Sanjiv Vaidya. At the opposite end was H K Patel. I let the memories surge for a while, take a few snaps and head for the staircase. Almost reflexively, I look straight ahead at the top floor of H1, where the girls had their rooms. Sure enough, a young thing in shorts steps out. She sees me and seems faintly startled. Clearly, an unfamiliar face.
I introduce myself to the watchman. He, in turn, introduces me to a fresh entrant, a boy from IIT Chennai. The PGP-I batch has just started coming in. Several vehicles drive up unloading their passengers. Even the boys seem to be accompanied by one or both parents. I guess that was a luxury in our time.
I park myself in the seating space around a tree outside the hostel and take in the buildings slowly. I recall the innumerable hours had we spent there. Stepping out with a cup of tea was almost mandatory after breakfast and at tea-time. After dinner, there was the post-prandial walk, followed by a session in those seating places. Boy, am I glad I went to IIMC, which gave you the time and the space for these indulgences. At IIMA, life in the first year is a grim struggle for survival. After the torture I went through at IIT Bombay, that's the thing I liked most about IIMC: it was a place for gentlemen. They didn't believe in silly things like compulsory attendance.
I allow the memories to float by and feel a sharp pang. There was a lightness to living then, which is the quality of youth itself. As time goes by, life begins to seem more and more of a burden with endless chores, rigid time-tables and nameless worries. I leave, heavy at heart.
Sunday, June 15, 2014
Wednesday, June 11, 2014
State subsidies to banks
States guarantee bank deposits (upto a staggering $250,000) in the US. (In India, the amount guaranteed is piffling in comparison, Rs 100,000 or around $15,500). As a result, banks can borrow money at a lower interest rate than without the government backstop. This amounts to a state subsidy to banks. The value of the subsidy, according to an article in the Economist, is $100 bn in the UK and Japan, $300 bn in the Euro area and a total of $630 bn for the rich world. One obvious way to prune these would be to reduce the value of bank deposits guaranteed. Raising equity capital requirement for banks (and correspondingly reducing debt) would also serve to reduce the subsidy.
One other thought comes to mind. In reporting their profits, banks must reduce the value of the subsidy they get. Executive bonuses must be linked to profits, adjusted for subsidies. That would help rein in executive pay in banking, which is itself a source of systemic risk.
One other thought comes to mind. In reporting their profits, banks must reduce the value of the subsidy they get. Executive bonuses must be linked to profits, adjusted for subsidies. That would help rein in executive pay in banking, which is itself a source of systemic risk.
Tuesday, June 10, 2014
Private banks are at odds with the law and ethics
There is no let up in the fines being imposed on banks. Banks are now waiting to see whether the reported $10 bn fine on BNP for violating US trade sanctions will materialise. We have the Libor rigging scandal earlier, the fine on Standard Chartered for busting Iran sanctions, the fine on HSBC on money-laundering charges in its Mexican operation.... one wonders when it will all end.
The problem in banking is that the combination of incentives linked to return on equity and persistent high leverage almost makes it inevitable that bank executives will look out for the sharp opportunity and the risky gamble. A modest increase in leverage does not solve the problem. Nor, as an article in the FT argues, will refining executive incentives and slapping fines on banks. The problems are fundamental and they require radical solutions:
The point is that private banks, as they are run today, pose major risks to society. Neither today's level of regulation nor the level of corporate governance diminishes this fact. It is astonishing that the P J Nayak committee on bank governance does not recognise this and argues for a diminished government presence in public sector banks and an aping of the ways of private sector banks, with boards being the key to good governance. It hasn't worked in the west and it won't work here.
The problem in banking is that the combination of incentives linked to return on equity and persistent high leverage almost makes it inevitable that bank executives will look out for the sharp opportunity and the risky gamble. A modest increase in leverage does not solve the problem. Nor, as an article in the FT argues, will refining executive incentives and slapping fines on banks. The problems are fundamental and they require radical solutions:
As long as incentives are at odds with ethical requirements, common decency will be a minority pursuit. Scandals are inevitable. And as the gap between bankers’ pay and that of executives outside the financial system grows ever wider, business leaders lose moral authority, and the case for enlightened capitalism is devalued. There are honest people in banking. But it has become a less comfortable place for those with a strong moral conscience.What are the answers? The article suggests two. One is two go after bankers and prosecute them instead of merely slapping fines on bankers (which means you penalise shareholders rather than executives). The other is to treat banking as a utility, which would mean stringent regulation on what products they can offer, what returns they can make, what they can their executives etc.
The point is that private banks, as they are run today, pose major risks to society. Neither today's level of regulation nor the level of corporate governance diminishes this fact. It is astonishing that the P J Nayak committee on bank governance does not recognise this and argues for a diminished government presence in public sector banks and an aping of the ways of private sector banks, with boards being the key to good governance. It hasn't worked in the west and it won't work here.
Monday, June 09, 2014
How bad is the global downturn- and what can be done?
There is talk of recovery and growth in the western world and in the global economy. In the US, there is celebration because there are more jobs today than at the high point of 2008. We need to hold the celebration, though. We need to compare where output and jobs are today with where we might have been, had the crisis not occurred. An article in the FT sums up some of the findings on this subject.
While several economies have now returned to their previous peak levels of output, very few have approached the previous long term trendlines which had been established for decades before that. For the developed economies as a whole, output remains about 12 per cent below these trendlines.
The trillion dollar question is: can the developed world return to the growth level indicated by the trendlines- and how soon? Now, output can depart from the trendline for two reasons: a permanent loss of capacity and an output gap (that is, output does not fully come up to the output capacity). The article cites a paper that shows that the overwhelming proportion of the departure from trendline is on account of loss of capacity- 7.2%. Only 2.6% of the departure is explained by the output gap.
Now, we can speculate about why the loss of capacity has turned out to be permanent. When you have a protracted recession, labour participation goes down because of a loss of skills, investment spending is crippled, innovation gets a severe setback. Whatever the reason, the fact that only a small portion of the loss of output is on account of an output gap means that fiscal or monetary stimulus can only do so much to restore the developed world to their growth path.
As the article points out, there could be a role for a broader range of fiscal instruments, such as tax cuts, incentives for investment and for work, infrastructure spending etc. But these instruments operate not just on the demand side but also on the supply side. In other words, given the damage that has occurred to economic capacity, there is only so much that demand management can accomplish. Perhaps, that would explain why both the fiscal and monetary stimulus that followed the crisis have yielded so little.
Friday, June 06, 2014
Is your boss a loony?
We tend to think of corporate bosses, including CEOs, as supremely well-adjusted beings, people with a high EQ who have, over the years, smoothed out their edges, perfected the art of dealing with people and- lest I forget- with a terrific sense of values.
The truth is often to the contrary - and it can be rather unsettling. Insead professor Manfred Kets de Vries points out in a recent HBR article that a surprisingly large number of senior executives have a serious personality disorder. As a result, the environment of the company in which the leader operates becomes toxic. People find it hard to function.
Vries identifies four main disorders; pathological narcissists, who are selfish and entitled, have grandiose fantasies, and pursue power at all costs; manic-depressives, who can leave a trail of emotional blazes behind them; passive-aggressives, who shy away from confrontation but are obstructive and underhanded; and the emotionally disconnected—literal-minded people who cannot describe or even recognize their feelings.
I am sure this is something many of us will have no difficulty relating to. We have all encountered bosses who are tyrannical, unreasonable, deceitful and full of themselves. The question is: how common or uncommon is this syndrome? Perhaps the more acute or psycopathic manifestations are somewhat rare. However, it appears almost inevitable that, in clawing their way to the top, executives require and develop qualities that renders them toxic by the time they get there. Among these qualities are: ruthlessness, disregard for scruple, a certain low cunning, an ability to manipulate people, and a degree of megalomania that gets confirmed with each round of "success" achieved.
These are the very qualities that contribute to their success- and, of course, they enhance shareholder value. It is important to understand, however, that the very drive, ambition and focus on achievement that propels them to the top enhances their toxicity and that of the companies to which they belong. As one reader writes in response:
Vries believes that by identifying these pathologies, one can "coach" leaders back into normal behaviour. I am inclined to be sceptical. Once a person is high enough up the ladder, who are the people who would dare to tell him that he's bonkers? And which leader would want to acknowledge a serious disorder and would want to deal with it.
The unpleasant reality is that, in the competitive world in which we operate and the single-minded focus on results, defined entirely in terms of profit, such behaviours are almost inevitable. We will need to question the basic purpose of the corporation and its culture if "toxic" leaders are to be checked. It is not that you create a situation that requires leaders to be "toxic" if they are to succeed - and then proceed to treat them once you notice the fall-out.
The truth is often to the contrary - and it can be rather unsettling. Insead professor Manfred Kets de Vries points out in a recent HBR article that a surprisingly large number of senior executives have a serious personality disorder. As a result, the environment of the company in which the leader operates becomes toxic. People find it hard to function.
Vries identifies four main disorders; pathological narcissists, who are selfish and entitled, have grandiose fantasies, and pursue power at all costs; manic-depressives, who can leave a trail of emotional blazes behind them; passive-aggressives, who shy away from confrontation but are obstructive and underhanded; and the emotionally disconnected—literal-minded people who cannot describe or even recognize their feelings.
I am sure this is something many of us will have no difficulty relating to. We have all encountered bosses who are tyrannical, unreasonable, deceitful and full of themselves. The question is: how common or uncommon is this syndrome? Perhaps the more acute or psycopathic manifestations are somewhat rare. However, it appears almost inevitable that, in clawing their way to the top, executives require and develop qualities that renders them toxic by the time they get there. Among these qualities are: ruthlessness, disregard for scruple, a certain low cunning, an ability to manipulate people, and a degree of megalomania that gets confirmed with each round of "success" achieved.
These are the very qualities that contribute to their success- and, of course, they enhance shareholder value. It is important to understand, however, that the very drive, ambition and focus on achievement that propels them to the top enhances their toxicity and that of the companies to which they belong. As one reader writes in response:
If "a surprising number of senior executives do have a personality disorder of some kind", isn't there something inherently wrong in the way we select leaders in business as well as the kind of behaviors we encourage in order to make it to the top?
Vries believes that by identifying these pathologies, one can "coach" leaders back into normal behaviour. I am inclined to be sceptical. Once a person is high enough up the ladder, who are the people who would dare to tell him that he's bonkers? And which leader would want to acknowledge a serious disorder and would want to deal with it.
The unpleasant reality is that, in the competitive world in which we operate and the single-minded focus on results, defined entirely in terms of profit, such behaviours are almost inevitable. We will need to question the basic purpose of the corporation and its culture if "toxic" leaders are to be checked. It is not that you create a situation that requires leaders to be "toxic" if they are to succeed - and then proceed to treat them once you notice the fall-out.
Tuesday, June 03, 2014
Air India's losses? Look at private airlines
The media has been going to town about Air India's losses. With their penchant for trivialising issues, they have been carrying stories about freebies offered by Air India to its staff and its politicians- as though that is why the airline is running up losses. (Do they private owners of companies do not milk them at shareholders' expense?).
Anyway, Air India's losses for 2013-14 of Rs 2012 crore and projected loss of around Rs 1000 crore for 2014-15 look modest compared to those at Jet Airways, as today's edit in BS makes clear. Jet's losses for the first three months of calender year 2014 are a staggering Rs 2153 crore! Spice Jet and Jet Lite both made losses of over Rs 300 crore in the same period. The problems have to do with traffic and revenues not measuring up to expectations in a highly capital-intensive business. Air India's problem is the large burden of debt accumulated because of a large fleet order placed at a time when there was irrational exuberance about the growth of air traffic. Operational efficiency at Air India is not the issue. Nor is public ownership.
If ownership is the issue, then should we consider nationalising Jet because of the losses it is running up?
Anyway, Air India's losses for 2013-14 of Rs 2012 crore and projected loss of around Rs 1000 crore for 2014-15 look modest compared to those at Jet Airways, as today's edit in BS makes clear. Jet's losses for the first three months of calender year 2014 are a staggering Rs 2153 crore! Spice Jet and Jet Lite both made losses of over Rs 300 crore in the same period. The problems have to do with traffic and revenues not measuring up to expectations in a highly capital-intensive business. Air India's problem is the large burden of debt accumulated because of a large fleet order placed at a time when there was irrational exuberance about the growth of air traffic. Operational efficiency at Air India is not the issue. Nor is public ownership.
If ownership is the issue, then should we consider nationalising Jet because of the losses it is running up?
Monday, June 02, 2014
Academic research in India and top-ranked journal publications
Indian universities, the IITs and the IIMs rank low in international rankings. Everybody knows why: inadequate faculty publications in top-ranked international journals. The solution that many institutions have adopted is to incentivise publications in these journals by making these a condition for confirmation and promotion.
Pulapre Balakrishnan, writing in the Hindu, questions this approach and proposes an alternative:
That said, what do we make of Balakrishnan's alternative? "Peer-review" within one's own institution can become a farce, an exercise in mutual back-scratching (or back-stabbing). A committee of outside experts is a better idea but, again, these experts must not be constituted by the head of the institution whose faculty is being evaluated. We need an independent body constituted by the government for this purpose. This body must consist of academics with impeccable research credentials. MHRD had proposed setting up a collegium of scholars for making appointments to central universities, IITs and IIMs. Such a body could also be entrusted with the task of reviewing research.
However, we need to be clear about one thing. If we turn our backs on international publications, we must forget about moving up in international rankings as well.
Pulapre Balakrishnan, writing in the Hindu, questions this approach and proposes an alternative:
In July 2013, a group of scientists and publishers issued a statement called the San Francisco Declaration on Research Assessment (DORA). While identifying peer-reviewed papers as central to an evaluation of research output, they argued for eliminating the use of journal-based metrics, such as the Journal Impact Factor (JIF) in funding, appointment and promotion considerations. It was recommended that research ought to be assessed on its own merits rather than on the basis of the journal in which it was published. It is significant that among the original signatories of DORA was the American Association for the Advancement of Science.Balakrishnan does not spell out why precisely we should not insist on publications in top-ranked journals. One important reason that I would venture to put forward is that, at least in the social sciences, it is difficult for Indian researchers, working on Indian problems, to get published in the top journals which are overwhelmingly in the West (mostly, the US). These topics may not be of interest to those journals. Also, publication in a journal requires knowing what topics and approaches are the flavour of the day, networking with journal editors and referees, having the opportunity to have one's working paper critiqued in seminars at leading colleges. Bereft of these advantages, Indian academics face heavy odds. Insisting on A-grade journal publications, in these circumstances, could lead to demoralisation- and faculty not producing anything at all. A classic case of the best becoming the enemy of the good.
We need to heed this call. Quantitative scoring based on JIF may wear the garb of objectivity, and cardinality may even bring with it the comfort of transparency to some, but it cannot be a substitute for assessing knowledge creation. The long-standing practice in India had been to have research peer-reviewed and these reports considered by a committee of experts. There should be a return to this practice as it is superior to the points-based system which prejudges content and quality. Finally, in issuing a guideline for assessing research, the UGC must focus exclusively on the researcher’s contribution to knowledge and cease privileging “foreign” publications over “Indian” ones and “international” conferences over “national” ones.
That said, what do we make of Balakrishnan's alternative? "Peer-review" within one's own institution can become a farce, an exercise in mutual back-scratching (or back-stabbing). A committee of outside experts is a better idea but, again, these experts must not be constituted by the head of the institution whose faculty is being evaluated. We need an independent body constituted by the government for this purpose. This body must consist of academics with impeccable research credentials. MHRD had proposed setting up a collegium of scholars for making appointments to central universities, IITs and IIMs. Such a body could also be entrusted with the task of reviewing research.
However, we need to be clear about one thing. If we turn our backs on international publications, we must forget about moving up in international rankings as well.
Saturday, May 31, 2014
Gary Becker
The passing of Nobel Laureate Gary Becker went unnoticed in the Indian press. Becker showed how the tools of economics could be applied to numerous areas outside the field of economics. Here is the Economist's tribute.
P J Nayak committee on bank governance
The RBI committee on bank governance, headed by PJ Nayak, submitted its report earlier this month. The committee wants government to divest control and eventually its majority stake in public sector banks. PSBs are to be a run initially by Bank Boards Bureau, then by a Bank Investment Company (BIC) manned entirely by bankers and eventually by bank boards whose chairmen, directors and CEOs will be appointed by the BIC. The government's stakes in the BIC will eventually fall below 50%, which would mean privatisation.
The model the committee has in mind is Axis Bank (formerly UTI Bank) in which the government first distanced itself from management, then from control and went on to reap huge returns. Well, the government floated SBI at Rs 100 and its now trading at over Rs 2500.
Handing over the entire lot of PSBs to one set of bankers- unelected and unaccountable to parliament- is an enormous risk. It is also unnecessary. Boards of PSBs can be professionalised by government and the issues of management- succession planning, job rotation, training, recruitment of specialists from the market, etc- can all be done within the ambit of public ownership.
What we don't want is a set of PSBs handed over to private owners and managers who make their money and then take it bankruptcy- for the taxpayer to bail them out. If this happens in India on the scale we saw in the west in the financial crisis, that is a recipe for both political and economic turbulence.
I have a detailed critique of the report in EPW and a shorter commentary in the Hindu.
The model the committee has in mind is Axis Bank (formerly UTI Bank) in which the government first distanced itself from management, then from control and went on to reap huge returns. Well, the government floated SBI at Rs 100 and its now trading at over Rs 2500.
Handing over the entire lot of PSBs to one set of bankers- unelected and unaccountable to parliament- is an enormous risk. It is also unnecessary. Boards of PSBs can be professionalised by government and the issues of management- succession planning, job rotation, training, recruitment of specialists from the market, etc- can all be done within the ambit of public ownership.
What we don't want is a set of PSBs handed over to private owners and managers who make their money and then take it bankruptcy- for the taxpayer to bail them out. If this happens in India on the scale we saw in the west in the financial crisis, that is a recipe for both political and economic turbulence.
I have a detailed critique of the report in EPW and a shorter commentary in the Hindu.
Friday, May 30, 2014
Pak general on Modi
To the dismay of many in Pakistan, let me suggest that if Modi gets his act together, he will take India places. India will change, perhaps finally realising its dream and potential, as will its polity. India will never be the same again; this remains my considered opinion. He is that kind of fellow.
....Modi’s aim will not be to seek a war. But come another situation like Mumbai 2008, he would like his military to respond with effect; of that there should be little confusion. Pakistan will then need to evolve its own plan to first deter and then respond to such a reprisal. That will put them both on a slippery slope of escalation dominance.
Shazad Chowdhry, a former air vice marshal, writing in The News, Pakistan.
(Thanks to Sanjiv Sood for the pointer)
Tuesday, May 27, 2014
How to tackle food inflation?
The new government's big priority is tackling inflation, chiefly food inflation. One option often suggested is simply releasing some of the foodgrain stocks held by the government at a low price or even free. Isn't this better than allowing the grain to rot or be eaten by rats?
Well, the answer is not that simple. Kaushik Basu, former CEA, made the point in 2011 in an article in EPW. If the government unloads grain at below the market price, traders will buy it up and sell at the market price through their shops, making a neat profit! So, this won't work.
How do we reach food to the poor at subsidised priecs. The public distribution system has leakages but some states have managed to plug these effectively (Tamil Nadu and Chattisgarh). The answer that Basu proposes is giving food stamps to the poor. They can use the stamps to buy from any private shop. There could be a problem here. What if the market price spirals out of control? Will the poor get adequate food, then, using food stamps? Working to plug leakages in the PDS using IT might be a better option for now.
Well, the answer is not that simple. Kaushik Basu, former CEA, made the point in 2011 in an article in EPW. If the government unloads grain at below the market price, traders will buy it up and sell at the market price through their shops, making a neat profit! So, this won't work.
How do we reach food to the poor at subsidised priecs. The public distribution system has leakages but some states have managed to plug these effectively (Tamil Nadu and Chattisgarh). The answer that Basu proposes is giving food stamps to the poor. They can use the stamps to buy from any private shop. There could be a problem here. What if the market price spirals out of control? Will the poor get adequate food, then, using food stamps? Working to plug leakages in the PDS using IT might be a better option for now.
Monday, May 26, 2014
Will America abolish the death penalty?
When it comes to the death penalty, the US is in truly dubious company in terms of the number of it people it executes every year: China, Saudi Arabia and Iran. This is in stark contrast to Western Europe which has abolished the death penalty.
The Economist notes that pendulum has slowly swung towards abolition for a number of reasons:
The Economist notes that pendulum has slowly swung towards abolition for a number of reasons:
- Support for the death penalty has dropped from 80% in 1994 to 60% last year.
- The number of executions has fallen from 98 to 39
- The empirical evidence is that the US has a higher murder rate than the EU despite the latter having abolished the death penalty. The murder rate is higher in American states that have the penalty than those that don't
- Executing somebody is three times more expensive than locking him up for life, thanks the long-winding appeals process.
Saturday, May 24, 2014
Thomas Piketty book flawed by errors?
This could be the story of the year on the book of the decade. FT claims its investigation of the spreadsheets used by Thomas Piketty in his sensational book, Capital in the 21st century, showed there were serious errors:
The data underpinning Professor Piketty’s 577-page tome, which has dominated best-seller lists in recent weeks, contain a series of errors that skew his findings. The FT found mistakes and unexplained entries in his spreadsheets, similar to those which last year undermined the work on public debt and growth of Carmen Reinhart and Kenneth Rogoff.Chris Giles provides a detailed critique of these errors here.
.....In his spreadsheets, however, there are transcription errors from the original sources and incorrect formulas. It also appears that some of the data are cherry-picked or constructed without an original source.For example, once the FT cleaned up and simplified the data, the European numbers do not show any tendency towards rising wealth inequality after 1970. An independent specialist in measuring inequality shared the FT’s concerns.
It was the politics, stupid
The markets are on fire following the victory of the BJP. Optimism is in the air. People are again talking of a return to a growth rate of 7-8% after the 5% growth rate of the last three years. This has led commentators to conclude that it is the economic downturn plus high inflation spelt doom for the UPA in the recent elections.
As readers of this blog would know, I have argued that the UPA's economic performance was not bad at all and that its record of growth with equity is impressive. A British academic, writing in the Indian Express, corroborates this view with a focus on how real incomes improved in the rural areas:
As readers of this blog would know, I have argued that the UPA's economic performance was not bad at all and that its record of growth with equity is impressive. A British academic, writing in the Indian Express, corroborates this view with a focus on how real incomes improved in the rural areas:
They (the NCAER and a team from the University of Maryland) surveyed just under 42,000 households across India in 2011-12, a massive sample. Crucially, these were the same households that they had surveyed in 2004-05, so they could track changes that were experienced over the first seven years of UPA rule.So, it's hard to ascribe the UPA's failure to economic outcomes in terms of improvement in real incomes of the masses. It could well be that the failure to deliver on other expectations- electricity, roads, water- and popular expectations in respect of these made a difference. However, it is the political factors, the writer suggests, that really mattered. It may not have been corruption, as the writer thinks, as much as the appeal of Modi's leadership and of Hindutva, as I have argued in an earlier post.
The study found that real average household incomes in rural areas had increased by 5 per cent annually, which was almost twice the increase of 2.6 per cent in towns and cities.
When they adjusted their calculations using the numbers of members of households, the growth of incomes in rural India was even more impressive: an annual average of 7.2 per cent. So the UPA’s policies clearly helped to make growth “inclusive” in terms of the rural/ urban divide.
What about poor people? The researchers separated respondents to their survey into several social groups. They then calculated changes in per capita household incomes for each one. The most prosperous group, “high caste Hindus”, gained less than all of the other groups. The table tells the story.
Tuesday, May 20, 2014
Understanding Modi's victory
Well, yes, it is Modi's victory, not the BJP's, as many have said. Surjit Bhalla makes the point forcefully in his piece today. As he points out, had the BJP been led by anybody else, people would not have been able to tell the difference between the NDA and the UPA.
But what exactly has brought about this victory? The direction of change was clear enough from the opinion polls but none predicted the sheer enormity of it. I have been reflecting on the many explanations:
i. People were fed up with corruption: No. Many of the surveys did not thrown up corruption as a major concern. I doubt that anybody seriously thinks that corruption will disappear with the new government.
ii. The slowdown in growth and mismanagement of the economy: If one looks at the last ten years or even the last five, the UPA government's management of the economy has been pretty good. True, we have had two years of a slowdown and high inflation and some of the urban middle class may have been swayed by the development agenda of Modi. But real wages in the rural sector have gone up in recent years despite inflation and the rural poor have also benefited from the UPA's welfarism.
iii. People don't want welfarism, they want growth and jobs:Trouble is, the BJP has not asked for MNREGA to be scaled down or closed, it was more aggressive on the Food Security Act than the Congress, strongly supported Land Acquisition Bill and opposed what has been labelled a reformist move, letting in FDI into multi-brand retail.
iv. The Congress did not communicate its achievements properly: Does that mean the NDA lost because its India Shining campaign was not effective in 2004, that the Congress somehow had better communications in 2009? Not convincing.
v. People have had enough of dynasty: Is that why they favoured the Shiv Sena in Maharashtra and made sure that Mulayam Singh Yadav's family alone got elected in UP while other party members were routed?
vi. The Congress did not project Rahul as a PM: Did that worsen or improve matters for the Congress?
vii. People were impressed with the Gujarat growth model: Yes, that's part of the explanation but it cannot be the whole explanation because, then, the CMs of Maharashtra and Tamil Nadu, two fast-growing states, should have been candidates for the post of PM in the past.
Personalities do count. Modi is an extraordinary personality by any reckoning, a man of enormous talent, energy, and a capacity to connect with the masses with his spell-binding oratory. Pitted against him was a 43-year old with no comparable record of accomplishment. In the eyes of many, it was a no-contest.
And yet, Indian elections do not centre on personalities alone. In 2004, Vajpayee would have easily scored over Sonia and it's hard to say that in 2009, Manmohan Singh was perceived to be clearly superior to L K Advani.
Adding to Modi's formidable personality and impressive track record was, I believe, another key factor: the potent appeal of Hindutva. Support for the BJP this time cut across caste barriers. That support could have only been the result of the transcending appeal of Hindutva. The BJP rode to power in 1999 on the strength of the Mandir campaign launched earlier by Advani. In 2004, as an article in BS pointed out recently, the difference between the BJP and the Congress was a mere nine seats: it was the Congress' allies that enable the UPA to prevail over the NDA. In 2009, the appeal of Hindutva was muted by five years of extraordinary growth which permitted welfarism on an extraordinary scale: the farm loan waive, MNREGA, the Pay Commission award etc.
In 2014, against a more normal (or sub-normal) economic background, the BJP was able to tap into the latent appeal of Hindutva. In Modi, it could not have had better candidate to do so. It is a phenomenon to which V S Naipual drew attention in the wake of the demolition of the Bajri Masjid. He characterised the event as the manifestation of long-suppressed Hindu pride and rage, a movement from the ground-up.( He was severely criticised for his explanation). With economic advancement, Naipaul noted in his book, A million mutinies now, comes an assertion of one's identity. The go-go years of this decade have provided the fuel for precisely such an assertion.
Development has its appeal but the pull of right-wing parties also involves a rich dose of nationalism. Development plus Hindutva must explain the sheer scale of Modi's victory.
But what exactly has brought about this victory? The direction of change was clear enough from the opinion polls but none predicted the sheer enormity of it. I have been reflecting on the many explanations:
i. People were fed up with corruption: No. Many of the surveys did not thrown up corruption as a major concern. I doubt that anybody seriously thinks that corruption will disappear with the new government.
ii. The slowdown in growth and mismanagement of the economy: If one looks at the last ten years or even the last five, the UPA government's management of the economy has been pretty good. True, we have had two years of a slowdown and high inflation and some of the urban middle class may have been swayed by the development agenda of Modi. But real wages in the rural sector have gone up in recent years despite inflation and the rural poor have also benefited from the UPA's welfarism.
iii. People don't want welfarism, they want growth and jobs:Trouble is, the BJP has not asked for MNREGA to be scaled down or closed, it was more aggressive on the Food Security Act than the Congress, strongly supported Land Acquisition Bill and opposed what has been labelled a reformist move, letting in FDI into multi-brand retail.
iv. The Congress did not communicate its achievements properly: Does that mean the NDA lost because its India Shining campaign was not effective in 2004, that the Congress somehow had better communications in 2009? Not convincing.
v. People have had enough of dynasty: Is that why they favoured the Shiv Sena in Maharashtra and made sure that Mulayam Singh Yadav's family alone got elected in UP while other party members were routed?
vi. The Congress did not project Rahul as a PM: Did that worsen or improve matters for the Congress?
vii. People were impressed with the Gujarat growth model: Yes, that's part of the explanation but it cannot be the whole explanation because, then, the CMs of Maharashtra and Tamil Nadu, two fast-growing states, should have been candidates for the post of PM in the past.
Personalities do count. Modi is an extraordinary personality by any reckoning, a man of enormous talent, energy, and a capacity to connect with the masses with his spell-binding oratory. Pitted against him was a 43-year old with no comparable record of accomplishment. In the eyes of many, it was a no-contest.
And yet, Indian elections do not centre on personalities alone. In 2004, Vajpayee would have easily scored over Sonia and it's hard to say that in 2009, Manmohan Singh was perceived to be clearly superior to L K Advani.
Adding to Modi's formidable personality and impressive track record was, I believe, another key factor: the potent appeal of Hindutva. Support for the BJP this time cut across caste barriers. That support could have only been the result of the transcending appeal of Hindutva. The BJP rode to power in 1999 on the strength of the Mandir campaign launched earlier by Advani. In 2004, as an article in BS pointed out recently, the difference between the BJP and the Congress was a mere nine seats: it was the Congress' allies that enable the UPA to prevail over the NDA. In 2009, the appeal of Hindutva was muted by five years of extraordinary growth which permitted welfarism on an extraordinary scale: the farm loan waive, MNREGA, the Pay Commission award etc.
In 2014, against a more normal (or sub-normal) economic background, the BJP was able to tap into the latent appeal of Hindutva. In Modi, it could not have had better candidate to do so. It is a phenomenon to which V S Naipual drew attention in the wake of the demolition of the Bajri Masjid. He characterised the event as the manifestation of long-suppressed Hindu pride and rage, a movement from the ground-up.( He was severely criticised for his explanation). With economic advancement, Naipaul noted in his book, A million mutinies now, comes an assertion of one's identity. The go-go years of this decade have provided the fuel for precisely such an assertion.
Development has its appeal but the pull of right-wing parties also involves a rich dose of nationalism. Development plus Hindutva must explain the sheer scale of Modi's victory.
Friday, May 16, 2014
The accidental Prime Minister
I have finished reading Sanjaya Baru's The accidental prime minister.The book is unputdownable. It is an absorbing ring-side account of what went on in the PM's office in 2004-08, the period that Baru served as media advisor. The intrigues at the highest levels, the jostling for positions and the pulls and pressures on the prime minister- one gets an excellent flavour of these.
One anecdote lingers in the mind. M K Narayanan got the job of NSA after Mani Dixit passed away. Other contenders were in the fray. Narayanan seemed to have concluded that it was Sonia Gandhi who swung the job for him. At the beating of the retreat ceremony that year, he rises from his seat in one of the back rows, goes up to Gandhi sitting in the front row and, in full view of the cabinet ministers and foreign dignitaries, does a namaste and returns to his seat.
It is the book's central thesis, however, that is of primary interest. This is that Singh did a great job when he was given a relatively free hand in his first term. In 2009, he made the mistake of thinking the UPA's victory was his. The Gandhi family then went about showing him his place and reminding him that his primary responsibility in his second term was to ensure the succession of the Gandhi scion. This left Singh very little room to operate and that's why his reputation and that of the government went downhill. Baru's contention is that, having appointed Singh as PM, Sonia Gandhi should have let him get on with the job. Instead, she acted in ways that lowered the prestige of the office of PM.
I find it hard to accept Baru's contention. Political authority and power in a democracy flow from one's standing with the electorate. To put it bluntly, he (or she) who delivers the vote must call the tune. Prime ministers- Nehru, Indira and Rajiv Gandhi, Vajpayaee and V P Singh, to name a few- have exercised authority in the past because they were leaders of the party to which they belonged, were elected to the Lok Sabha and were also responsible for their party's coming to power.
Singh's case was very different. He was not the vote-puller for the Congress. He was appointed PM by the principal vote-puller, Sonia Gandhi. In such a scheme of things, it was only natural that the principal decision-maker should be Gandhi. Singh himself seems to have acknowledged as much when he told Baru that there could be only one power centre. It is Baru who seems to have difficulty accepting this.
Singh necessarily had to operate within a framework created by Gandhi and the party. It was also only to be expected that key political appointments and appointments in the PMO should be decided by Gandhi. If this resulted in the perception that the PM's office was being demeaned, that was implicit in the arrangement that Singh went along, not once but twice. It is naive to argue that Singh should have put his foot down on this or that issue because he happened to be PM. The fact is that he was an appointed PM, not an elected one.
There is a post-script to the book. Singh did not think it necessary to refute Baru's thesis after the book came out, instead choosing to maintain an eloquent silence over it. If he was responsible for the victory of the UPA in 2009, then he is also responsible for the subsequent fall in its standing. Or, if the Gandhis are responsible for the way the Congress' image has nose-dived, then they were also responsible for the victory of 2009. It cannot be that Singh gets the credit and the Gandhi family the blame. (Baru correctly points out that the Gandhis cannot take the credit but not the blame- he should apply the same logic to Singh).
The Congress party would have expected Singh to refute Baru's thesis and say to the world that he would not fault the relationship between himself and the Gandhis. He did not do so. As an article in today's Economic Times correctly points out, that is why Rahul Gandhi chose to stay away from the farewell given to Singh. The Gandhis would be justified in expecting better of somebody that put in the PM's seat for ten years, not to speak of the numerous positions he enjoyed earlier.
One anecdote lingers in the mind. M K Narayanan got the job of NSA after Mani Dixit passed away. Other contenders were in the fray. Narayanan seemed to have concluded that it was Sonia Gandhi who swung the job for him. At the beating of the retreat ceremony that year, he rises from his seat in one of the back rows, goes up to Gandhi sitting in the front row and, in full view of the cabinet ministers and foreign dignitaries, does a namaste and returns to his seat.
It is the book's central thesis, however, that is of primary interest. This is that Singh did a great job when he was given a relatively free hand in his first term. In 2009, he made the mistake of thinking the UPA's victory was his. The Gandhi family then went about showing him his place and reminding him that his primary responsibility in his second term was to ensure the succession of the Gandhi scion. This left Singh very little room to operate and that's why his reputation and that of the government went downhill. Baru's contention is that, having appointed Singh as PM, Sonia Gandhi should have let him get on with the job. Instead, she acted in ways that lowered the prestige of the office of PM.
I find it hard to accept Baru's contention. Political authority and power in a democracy flow from one's standing with the electorate. To put it bluntly, he (or she) who delivers the vote must call the tune. Prime ministers- Nehru, Indira and Rajiv Gandhi, Vajpayaee and V P Singh, to name a few- have exercised authority in the past because they were leaders of the party to which they belonged, were elected to the Lok Sabha and were also responsible for their party's coming to power.
Singh's case was very different. He was not the vote-puller for the Congress. He was appointed PM by the principal vote-puller, Sonia Gandhi. In such a scheme of things, it was only natural that the principal decision-maker should be Gandhi. Singh himself seems to have acknowledged as much when he told Baru that there could be only one power centre. It is Baru who seems to have difficulty accepting this.
Singh necessarily had to operate within a framework created by Gandhi and the party. It was also only to be expected that key political appointments and appointments in the PMO should be decided by Gandhi. If this resulted in the perception that the PM's office was being demeaned, that was implicit in the arrangement that Singh went along, not once but twice. It is naive to argue that Singh should have put his foot down on this or that issue because he happened to be PM. The fact is that he was an appointed PM, not an elected one.
There is a post-script to the book. Singh did not think it necessary to refute Baru's thesis after the book came out, instead choosing to maintain an eloquent silence over it. If he was responsible for the victory of the UPA in 2009, then he is also responsible for the subsequent fall in its standing. Or, if the Gandhis are responsible for the way the Congress' image has nose-dived, then they were also responsible for the victory of 2009. It cannot be that Singh gets the credit and the Gandhi family the blame. (Baru correctly points out that the Gandhis cannot take the credit but not the blame- he should apply the same logic to Singh).
The Congress party would have expected Singh to refute Baru's thesis and say to the world that he would not fault the relationship between himself and the Gandhis. He did not do so. As an article in today's Economic Times correctly points out, that is why Rahul Gandhi chose to stay away from the farewell given to Singh. The Gandhis would be justified in expecting better of somebody that put in the PM's seat for ten years, not to speak of the numerous positions he enjoyed earlier.
Thursday, May 15, 2014
The probability of getting murdered
Well, it was one in 16,000 in 2012 according to a UN report quoted in an article in the Economist. How to shorten the odds? The Economist offers useful tips:
First, don’t live in the Americas or Africa, where murder rates (one in 6,100 and one in 8,000 respectively) are more than four times as high as the rest of the world. Western Europe and East Asia are the safest regions....Next, be a woman. Your chance of being murdered will be barely a quarter what it would be were you a man. In fact, steer clear of men altogether: nearly half of all female murder-victims are killed by their partner or another (usually male) family member. Then, sit back and grow older. From the age of 30 onwards, murder rates fall steadily in most places. But not everywhere. Europeans are more at risk in middle age than in youth.Surprisingly, when it comes to murder, crime pays. Only 43% of murders result in convictions. In the Americas, you can literally get away with murder: the probability that you will escape justice is 0.75.
Monday, May 12, 2014
Was Manmohan Singh the architect of UPA victory in 2009?
In his book, The Accidental Prime Minister, Sanjaya Baru contends that PM Manmohan Singh was responsible for the UPA coming back to power for a second term. He says that the strong performance of the economy, the PM's reputation for integrity (before the scams started erupting the UPA's second term) and, not least, the Indo-US nuclear deal boosted the UPA's standing amongst the middle classes. They voted solidly for him and that's how the Congress did so well in the cities. Singh's big mistake, according to Baru, was to let the party know that that is how he felt.
The party had other ideas. They wanted Singh to prepare the ground for Rahul Gandhi to take over and they wanted him to clearly understand that the vote-puller was the Gandhi family and hence Sonia Gandhi the boss. Since Singh seemed to claim credit for the UPA victory, they set out to 'defang' him. That's how Singh ended up losing stature and indeed becoming an object of ridicule.
It is a beguiling thesis. But how true is the claim that Singh brought about the UPA victory? T N Ninan has an interesting rejoinder in his column in BS. Ninan points out that the Congress victories in the cities were nowhere as impressive as Baru makes out:
The party had other ideas. They wanted Singh to prepare the ground for Rahul Gandhi to take over and they wanted him to clearly understand that the vote-puller was the Gandhi family and hence Sonia Gandhi the boss. Since Singh seemed to claim credit for the UPA victory, they set out to 'defang' him. That's how Singh ended up losing stature and indeed becoming an object of ridicule.
It is a beguiling thesis. But how true is the claim that Singh brought about the UPA victory? T N Ninan has an interesting rejoinder in his column in BS. Ninan points out that the Congress victories in the cities were nowhere as impressive as Baru makes out:
It is true that the Congress swept Delhi and Mumbai, but it did poorly in Bangalore and got noticeably fewer votes in Hyderabad-Secunderabad than in 2004, while the two seats were split as before. In Kolkata and Chennai, the party was a non-player. Among the smaller cities, Pune voted the Congress as before, Ahmedabad and Vadodara voted the BJP with most of Gujarat, and Jaipur voted the Congress with the rest of Rajasthan.I would think that the Sixth Pay Commission award, MNREGA and the farm loan waiver were all crucial in fetching votes for the Congress and resulting in its bettering its performance over 2004. For the second and the third, credit must go Sonia Gandhi. One respects the instincts of politicians, their shrewd understanding of what would translate into votes. If Sonia Gandhi had not been convinced (on the basis of evidence) that welfarism had paid off, she would not have persisted with those policies in UPA- II. If one accepts this, Singh was wrong in his understanding and there was some justification for the party showing him his place.
Of the two cities that the Congress did sweep, Mumbai had the special circumstance of a split in the Shiv Sena, with Raj Thackeray's newly formed Maharashtra Navnirman Sena cutting into the Shiv Sena vote and pushing it into second place in four out of six constituencies. In fact, the Congress share of the vote fell in four Mumbai seats in 2009, compared to 2004. So the only city where the Congress saw an uptick was Delhi, but then it had won six of the seven seats here in 2004. Juxtapose that against the fact that the Congress in poorly urbanised Uttar Pradesh did better than in any election since 1984, and also swept hilly Uttarakhand, and it becomes hard to argue that the party's better showing in 2009 was because of one man and his urban appeal.
Friday, May 09, 2014
Modi's aborted rally in Varanasi: wherein lies the truth?
On TV yesterday, I watched commentators fulminate about Modi's alleged disrespect for a constitutional authority, the Election Commission. Former CEC Krishnamurthy said that, whatever the BJP's complaint, they should not be criticising the EC, they could seek redress. So are Modi and the BJP kicking up a fuss without reason ? Ashok Malik's rendering of the events in ET sets you thinking about the merits of the EC decision:
The fact is the DM has changed his story several times, depending on the listener. On the evening of May 5, when the BJP asked for permission for Modi to address a public meeting in Benia Bagh in Varanasi, his only campaign speech in the urban segment of the constituency, the DM verbally agreed. It was decided a formal application and the deposit for the ground would be submitted the following morning. This was duly done at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate informed the BJP that Benia Bagh could not be allotted for the Modi meeting as one "Mr Khan" had booked it in the interim on behalf of his NGO. Apparently, he wanted to unfurl the national flag. Subsequently, other district officials confirmed to BJP functionaries that Mr Khan's application had been backdated and that the DM had exempted him from paying the deposit.
When confronted, the DM cancelled Mr Khan's allotment and instead told the BJP he had received a report from the Intelligence Bureau (IB) in Delhi warning of a security threat. Arun Jaitley, senior leader of the BJP, contacted the IB and was categorically told by the top leadership of the Bureau that no such special warning had been issued......At the Election Commissioners' media conference on the afternoon of May 8, the EC added another twist to the tale. It said the DM had rejected the Benia Bagh option because the ground was too small to accommodate the big crowds Modi would gather. This too didn't make sense. After all, in the set of permissions delivered at close to 2.00 am that morning, the DM had asked the BJP to hold its public meeting at the Chhota Cutting Memorial Maidan. This is smaller than Benia Bagh and takes in only 3,000.....Meeting a senior leader of the Varanasi BJP, the DM smiled in the midst of a disagreement and said, "After all, I have to stay here after the election ..." The implication of obvious. He had a state government - and a ruling party - to serve.
An opposite viewpoint is here but it doesn't tell us what happened.
At
2.00 pm on May 6, the district magistrate informed the BJP that Benia
Bagh could not be allotted for the Modi meeting as one "Mr Khan" had
booked it in the interim on behalf of his NGO. Apparently, he wanted to
unfurl the national flag. Subsequently, other district officials
confirmed to BJP functionaries that Mr Khan's application had been
backdated and that the DM had exempted him from paying the deposit.
When confronted, the DM cancelled Mr Khan's allotment and instead told the BJ ..
When confronted, the DM cancelled Mr Khan's allotment and instead told the BJ ..
Read more at:
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
At
2.00 pm on May 6, the district magistrate informed the BJP that Benia
Bagh could not be allotted for the Modi meeting as one "Mr Khan" had
booked it in the interim on behalf of his NGO. Apparently, he wanted to
unfurl the national flag. Subsequently, other district officials
confirmed to BJP functionaries that Mr Khan's application had been
backdated and that the DM had exempted him from paying the deposit.
When confronted, the DM cancelled Mr Khan's allotment and instead told the BJ ..
When confronted, the DM cancelled Mr Khan's allotment and instead told the BJ ..
At
2.00 pm on May 6, the district magistrate informed the BJP that Benia
Bagh could not be allotted for the Modi meeting as one "Mr Khan" had
booked it in the interim on behalf of his NGO. Apparently, he wanted to
unfurl the national flag. Subsequently, other district officials
confirmed to BJP functionaries that Mr Khan's application had been
backdated and that the DM had exempted him from paying the deposit.
When confronted, the DM cancelled Mr Khan's allotment and instead told the BJ ..
When confronted, the DM cancelled Mr Khan's allotment and instead told the BJ ..
At
2.00 pm on May 6, the district magistrate informed the BJP that Benia
Bagh could not be allotted for the Modi meeting as one "Mr Khan" had
booked it in the interim on behalf of his NGO. Apparently, he wanted to
unfurl the national flag. Subsequently, other district officials
confirmed to BJP functionaries that Mr Khan's application had been
backdated and that the DM had exempted him from paying the deposit.
When confronted, the DM cancelled Mr Khan's allotment and instead told the BJ ..
When confronted, the DM cancelled Mr Khan's allotment and instead told the BJ ..
The
fact is the DM has changed his story several times, depending on the
listener. On the evening of May 5, when the BJP asked for permission
for Modi to address a public meeting in Benia Bagh in Varanasi, his only
campaign speech in the urban segment of the constituency, the DM
verbally agreed. It was decided a formal application and the deposit for
the ground would be submitted the following morning. This was duly done
at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate ..
At 2.00 pm on May 6, the district magistrate ..
The
fact is the DM has changed his story several times, depending on the
listener. On the evening of May 5, when the BJP asked for permission
for Modi to address a public meeting in Benia Bagh in Varanasi, his only
campaign speech in the urban segment of the constituency, the DM
verbally agreed. It was decided a formal application and the deposit for
the ground would be submitted the following morning. This was duly done
at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate ..
At 2.00 pm on May 6, the district magistrate ..
Read more at:
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
The
fact is the DM has changed his story several times, depending on the
listener. On the evening of May 5, when the BJP asked for permission
for Modi to address a public meeting in Benia Bagh in Varanasi, his only
campaign speech in the urban segment of the constituency, the DM
verbally agreed. It was decided a formal application and the deposit for
the ground would be submitted the following morning. This was duly done
at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate ..
At 2.00 pm on May 6, the district magistrate ..
Read more at:
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
The
fact is the DM has changed his story several times, depending on the
listener. On the evening of May 5, when the BJP asked for permission
for Modi to address a public meeting in Benia Bagh in Varanasi, his only
campaign speech in the urban segment of the constituency, the DM
verbally agreed. It was decided a formal application and the deposit for
the ground would be submitted the following morning. This was duly done
at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate ..
At 2.00 pm on May 6, the district magistrate ..
The
fact is the DM has changed his story several times, depending on the
listener. On the evening of May 5, when the BJP asked for permission
for Modi to address a public meeting in Benia Bagh in Varanasi, his only
campaign speech in the urban segment of the constituency, the DM
verbally agreed. It was decided a formal application and the deposit for
the ground would be submitted the following morning. This was duly done
at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate ..
At 2.00 pm on May 6, the district magistrate ..
Read more at:
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
The
fact is the DM has changed his story several times, depending on the
listener. On the evening of May 5, when the BJP asked for permission
for Modi to address a public meeting in Benia Bagh in Varanasi, his only
campaign speech in the urban segment of the constituency, the DM
verbally agreed. It was decided a formal application and the deposit for
the ground would be submitted the following morning. This was duly done
at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate ..
At 2.00 pm on May 6, the district magistrate ..
Read more at:
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
http://economictimes.indiatimes.com/articleshow/34847642.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
The
fact is the DM has changed his story several times, depending on the
listener. On the evening of May 5, when the BJP asked for permission
for Modi to address a public meeting in Benia Bagh in Varanasi, his only
campaign speech in the urban segment of the constituency, the DM
verbally agreed. It was decided a formal application and the deposit for
the ground would be submitted the following morning. This was duly done
at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate ..
At 2.00 pm on May 6, the district magistrate ..
The
fact is the DM has changed his story several times, depending on the
listener. On the evening of May 5, when the BJP asked for permission
for Modi to address a public meeting in Benia Bagh in Varanasi, his only
campaign speech in the urban segment of the constituency, the DM
verbally agreed. It was decided a formal application and the deposit for
the ground would be submitted the following morning. This was duly done
at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate ..
At 2.00 pm on May 6, the district magistrate ..
The
fact is the DM has changed his story several times, depending on the
listener. On the evening of May 5, when the BJP asked for permission
for Modi to address a public meeting in Benia Bagh in Varanasi, his only
campaign speech in the urban segment of the constituency, the DM
verbally agreed. It was decided a formal application and the deposit for
the ground would be submitted the following morning. This was duly done
at 7.30 am on May 6.
At 2.00 pm on May 6, the district magistrate ..
At 2.00 pm on May 6, the district magistrate ..
Thursday, May 08, 2014
Why would the Congress lose the election?
What exactly is likely to cost the Congress the 2014 election? An FT commentator thinks it's not the growth slowdown or even rising inflation. It is the change in the voter profile over the years. The poor are no longer the dominant constituency with the proportion of those below the poverty line falling to 22%. And yet the Congress' policies have been targeted towards the poor, rather than the dominant segment with rising aspirations. The latter need jobs, not doles:
The other problem with the explanation is that it fails to tell us why the BJP, in its manifesto, is not arguing for the dismantling of subsidies and welfare schemes. As I have pointed out in my blogs, Mr Modi has been saying something to the contrary of late. He has argued, for instance, that MNREGA should be made more efficient- say, in terms of creating assets. He has not said the scheme should be wound up. He has also said subsidies must stay. If the FT commentator's thesis were correct, the BJP should be singing a different tune.
Whatever the statistics on poverty, it is more than likely that, in the medium-term, no government can afford any economic policy that is not centrist or even slightly to the left of centre. We have to look elsewhere for the disenchantment with the Congress. Mr Modi appeals on the strength of the fact that he is a self-made man, has not amassed wealth for himself and has a solid track record in Gujarat.
The Congress, in contrast, is projecting Rahul Gandhi, who is seen as a privileged scion of a dynasty, the UPA is tainted with corruption charges and Gandhi has yet to prove himself in an administrative capacity. The perceived diminishing of the office of PM under Manmohan Singh could also be a factor. Rightly or wrongly, the perception has gained ground that India needs a strong leader as PM and that Mr Modi could be that leader.
India in 2014, in other words, is not the same country it was in 2004. Congress’s undoing is that it has failed to recognise this. It has instituted socially laudable right-to-work and right-to-food programmes. But such schemes are costly and prone to rampant theft. By putting a strain on the Treasury, they have contributed to persistent inflation. That in turn has forced the central bank to raise interest rates, slowing growth.This is a rather simplistic explanation, I'm afraid. The UPA's schemes are targeted not just at the poor but at those above the poverty line as well. Schemes such as MNREGA and the right to education are not just for the poor. Subsidies, including those on cooking gas and even food, are intended for the middle class and those above the poverty line. Indeed, it could well be that it is the trend towards targeting of subsidies only for the poor that has alienated the middle class.
..Most Indians are no longer satisfied with the make-work schemes or food handouts in which Congress has increasingly specialised. Many have caught the whiff of a better life. Now they want jobs and opportunity. Even those who have not yet clawed their way on to the bottom rung of the aspirational ladder have seen what it looks like, courtesy of the satellite television channels that beam images of a middle-class life into even the most benighted corners of the country. India’s villages are not what they once were. The bullock cart has given way to the motorbike; the dirt road to tarmac.
The other problem with the explanation is that it fails to tell us why the BJP, in its manifesto, is not arguing for the dismantling of subsidies and welfare schemes. As I have pointed out in my blogs, Mr Modi has been saying something to the contrary of late. He has argued, for instance, that MNREGA should be made more efficient- say, in terms of creating assets. He has not said the scheme should be wound up. He has also said subsidies must stay. If the FT commentator's thesis were correct, the BJP should be singing a different tune.
Whatever the statistics on poverty, it is more than likely that, in the medium-term, no government can afford any economic policy that is not centrist or even slightly to the left of centre. We have to look elsewhere for the disenchantment with the Congress. Mr Modi appeals on the strength of the fact that he is a self-made man, has not amassed wealth for himself and has a solid track record in Gujarat.
The Congress, in contrast, is projecting Rahul Gandhi, who is seen as a privileged scion of a dynasty, the UPA is tainted with corruption charges and Gandhi has yet to prove himself in an administrative capacity. The perceived diminishing of the office of PM under Manmohan Singh could also be a factor. Rightly or wrongly, the perception has gained ground that India needs a strong leader as PM and that Mr Modi could be that leader.
Wednesday, May 07, 2014
Competition in Indian banking will be slow in coming
The RBI's decision to use a fresh set of licenses to banks had raised hopes that a new set of players would enter and invigorate competition in banking. Those hopes have since faded as the RBI granted 'in-principle' licenses to only two players.
For now, corporate houses are out. Newer players may have to come in as specialised players in wholesale banking, payments, infrastructure etc. There may not be many full-scope banks coming in. So, expect competition to be muted.
But does Indian banking lack competition at all? What is the rationale for letting in new players? More in my article in Hindu Business Line.
For now, corporate houses are out. Newer players may have to come in as specialised players in wholesale banking, payments, infrastructure etc. There may not be many full-scope banks coming in. So, expect competition to be muted.
But does Indian banking lack competition at all? What is the rationale for letting in new players? More in my article in Hindu Business Line.
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