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Wednesday, November 17, 2010

EDITORIAL 17.11.10

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media watch with peoples input                an organization of rastriya abhyudaya



month november 17, edition 000680 , collected & managed by durgesh kumar mishra, published by – manish manjul


Editorial is syndication of all daily- published newspaper Editorial at one place.











  2. 'HOUSE' THAT?














  1. DÉJÀ VU




  5. NOW & AGAIN


















  2. 5 Ways to Bring NATO and Russia Together - By Oksana Antonenko and Igor Yurgens







The much-talked about and speculated upon report of the Comptroller and Auditor-General on the shameful manner in which 2G Spectrum was allotted to certain corporate entities, many of them shell companies, at a throwaway price by then Telecom Minister and now disgraced DMK MP A Raja, has been made public by the Government, obviously with the intention of blunting the Opposition's relentless and ever-sharpening attack. But if the idea of placing the report in Parliament was to try and put a lid on the scandal that is threatening to tar the Congress and has raised a big question mark over the Prime Minister's ability to exercise his authority over wayward Cabinet colleagues, then it is unlikely to work. The CAG's report is a damning indictment of a venal politician high on bluster and low on scruples who was given charge of an important Ministry and who converted it into a cash-and-carry counter, corrupt bureaucrats who willingly colluded with their political master for reasons that do not require elaboration and greedy corporates that think nothing of violating laws in their lust for windfall profits. The report also exposes, though not for the first time, two important aspects of public life in India: The system of checks and balances which we believe exists lies in a shambles; and, the regulatory mechanism without which the private sector becomes a happy hunting ground for carpet baggers and buccaneers is more often than not an anaemic institution staffed with time-serving babus for whom a regulator's job is a post-retirement sinecure, a reward for services rendered in the past. Last, though not the least, the report shows the vice-like grip which lobbyists have come to wield on Ministries and institutions of the state by resorting to the expedient means of greasing palms to subvert policy or get it tailored to suit the requirements of their clients.

Audit reports are never laudatory, nor are they expected to be. Often the CAG's office gets obsessed with obscure rules and regulations that have been rendered meaningless in the post-liberalisation phase. It's also true that the CAG's office is known to needlessly nit-pick and highlight inconsequential details if only to demonstrate that it does a thorough job of combing files. But it would be uncharitable to describe the CAG's report on the 2G Spectrum scam as an exercise in picking holes and no different from any of its other reports. If anything, the 2G Spectrum report belongs to the same category as the CAG's devastating indictment of the Rajiv Gandhi Government for signing the flawed Bofors deal which involved payment of bribes to individuals and entities (it was later proved that the primary beneficiary was the Italian middleman Ottavio Quattrocchi known for his proximity to the Congress's first family). The Opposition, as with the Bofors bribery scandal, this time too is demanding the setting up of a Joint Parliamentary Committee to look into charges of corruption. Irrespective of whether or not that demand is conceded by the Government, it is expected to initiate action in accordance with the findings contained in the CAG's report. Indeed, if Mr Manmohan Singh wishes to mend the tattered image of a Prime Minister who chose not to stop his Minister from pulling off a Rs 1.76 lakh crore scam, he should take the initiative without any delay. 








The trilateral talks between India, Russia and China increasingly look more like a talking shop rather than a serious initiative to ensure stability in the region. This is especially so after the watered down joint communiqué issued on Monday in Wuhan calling for an "open, transparent, inclusive and balanced security and cooperation architecture in the Asia-Pacific" region. The communiqué stopped short of making any reference to dealing with terrorism emanating from Pakistan and Afghanistan which figured prominently in the discussions. Nor does the communiqué make any unequivocal comment on the unacceptability of safe havens for terrorists. This glaring omission is on account of China blocking the inclusion of any reference to terrorism. This is not entirely surprising as China is loath to queer its equations with Pakistan, its all-weather friend. China, which has discarded its mask of 'peaceful rise', is now brazenly seeking to increase its strategic presence in India's extended neighbourhood. The Gwadar deep sea port in Pakistan will provide China with strategic storage and trans-shipment facilities; the proposed China-Pakistan-Iran rail link will add strategic access to the Persian Gulf.

China's reluctance to acknowledge the truth about Pakistan is in sharp contrast to US President Barack Obama's open assertion of the need to eliminate "safe havens and infrastructure for terrorism and violent extremism in Afghanistan and Pakistan" and that "all terrorist networks, including Lashkar-e-Tayyeba, must be defeated". It is not that China does not realise the danger of terrorism originating in Pakistan and Afghanistan threatening the security of the entire region and its extended neighbourhood, including Xinjiang Province. It also poses a threat to Russia which is witnessing the spread of terrorism along its southern border. That China has successfully prevented any reference to Pakistan and Afghanistan in the joint RIC communiqué, apart from merely agreeing to the mention of "the need for adequate development of the Afghan National Security Forces to enable Afghanistan to defend its sovereignty and independence", is further proof of its narrow, self-serving Beijing-centric view in regional affairs. Seen in perspective, Mr Obama's offer to involve India in Afghanistan underscores the fact that Pakistan is part of the problem and not the solution. Having said that, it cannot be denied that the Obama Administration remains confused over its AfPak policy. While a flawed US policy has abetted terrorism, a serious cooperation against terrorism by the India-Russia-China initiative could have led to a win-win situation for the three Asian countries in a changing world order. Sadly, Beijing remains unmindful of this. 









It is ironic that the big news on the commercial front from US President Barack Obama's recent visit was about Indian orders worth $10 billion for American goods. And that it translates into 50,000 new jobs in the US. This, in a beleaguered America, with unemployment percentages running into near double digits, was Mr Obama's first message to Americans from Indian soil.

Irony is a largely Western concept with no equivalent in Sanskrit, even if its harbinger is a path-breaking African-American President of the US who was till recently given to stoking the outsourcing controversy with "Buffalo versus Bangalore" rhetoric. 

But then, the charismatic Barack Obama's roots, as one of the most Left-liberal US Presidents in recent times, are in local and community politics. And the dire state of the US economy, which he inherited in large measure and has largely rescued from certain ruin with huge Government hand-outs and near nationalisation style moves, is certainly not his fault. 

But not to miss a beat, our usually mild-mannered Prime Minister Manmohan Singh chimed in on cue at the customary joint Press conference after official talks by declaring that we Indians are not in the business of "stealing jobs" from anyone.

The fact is, a severe drubbing in the mid-term US congressional elections held just before his India visit set Mr Obama's perspective right. He got little credit in the polls for battling to save the economy of the free world from collapse and loads of brickbats for not putting the nation back to work. Duly chastised, Mr Obama is no longer keen on raising the outsourcing 'bogeyman'. 

The Republicans, now in control of the US House of Representatives, consider it Luddite folly to refuse to go wherever in the world something can be sourced more cheaply and efficiently. So India, particularly its thriving software industry, can breathe easier, both because Mr Obama is forced to course-correct now and, as an economy, we are in the American President's own estimate already "risen".

In a globalised world it is indeed seen as unwise to try and set the clock back — either because of populist reasons or on account of other vexing issues, such as bureaucracy, red-tape, corruption, even bad infrastructure — when the key need is for a thriving manufacturing base and export hub. This particularly when one has a limited, expensive, and ageing workforce, as is the case in most of Europe and Japan, if not also in the US. Even the Chinese workforce, though populous, is ageing, thanks to its one child policy. 

Japan, previously sceptical about India despite its potential, tried to grow its economy with China at first. And China took in huge amounts of Japanese investment in the 1980s but only to fuel its own will to power. The Communist Party of China was happy to fan anti-Japanese sentiments left over from the war years after Beijing's purpose was served. 

Japan's eyes are now opened to India. For long the 'Number Two' economy after the US, though languishing through a two-decade-long recession, over a hundred Japanese firms are entering India every year now. They are creating jobs here, in their home country and around the globe by investing, without demur, in the Indo-Japanese corridor between Delhi and Mumbai, among other places.

A $90 billion commitment, the corridor will, when completed, give the Indo-Japanese collaboration state-of-the-art manufacturing abilities and an export base second to none. The Japanese Government is also moving finally on other issues, like a free trade agreement, a bilateral defence framework and even an Indo-Japanese civil nuclear deal. 

America too is treading a similar path with India with some strategic and geopolitical overlays. Its intended removal of restrictions on access to dual use high technology, closer defence related cooperation and, of course, the consummation of the civil nuclear cooperation agreement are pointers in this direction.

There is a compelling need for many of the erstwhile dominant Western powers to forge closer ties with India, which has been growing robustly by dint of its domestic demand, and discard long-held negative attitudes that have outlived their usefulness. Some of them are moving towards the opportunities presented faster than others, but we can expect a cascade effect as time goes on. 

Pundit after financial pundit is proclaiming that the Sensex will be close to 50,000 by 2015 and double that figure by 2020 — the figures are based on an approximate compounded return of 18 per cent on equity. And this for the next quarter of a century at least, albeit with swells and troughs thrown into the puissant ride.

The biggest foreign bank in India, Standard Chartered, has declared India will be the world's fastest growing economy by 2012. In the next two decades India will become 
the third largest economy in GDP terms, only behind China and the US. Morgan Stanley, 
on its part, has said India will become the fastest growing economy in the world by 2013-15. At the root of all this happy talk, and even at its branches, is the belief that globalisation provides additional job opportunities at home and abroad in a win-win partnership between participants. It becomes a virtuous cycle of additional capital, raising both productivity and know-how for all concerned. The elephant both inside and outside the room is India's appetite for infrastructure development which will not be assuaged for years to come.

There was, during Mr Obama's visit, a low-key announcement of an India-US Infrastructure Development Fund with an initial corpus of $10 billion. Prime Minister Manmohan Singh, however, has said we need over a trillion dollars for infrastructure development over the next decade alone. There is, therefore, plenty of room for other investors.As Ms Linnet Mushran, an Englishwoman married to an Indian from the landed classes and the owner and inspiration behind the delectable Bhuira Jams made to legendary Fortnum & Mason quality standards by largely illiterate Himachali women, said, "Indian women are very good with pickles and English women with jams". 

The observation is strikingly true. But the magic ingredient in either case is, of course, an indefinable, cultural/ethnic instinct and sensibility for the appropriate that makes for the excellence.

The analogy can be extended to a while lot of other things that contribute both to the good life and human progress: Scotch and the Scots, sauces/gravies and the French, automobiles and the Germans, software and the Indians, mass-manufacturing and the Chinese, design and the Italians, scale and the Americans, and so on. 

The point being that some people are innately, and by virtue of their knack at something, 
better at doing certain things than others. Also, an intelligent workforce can be taught to perform to high standards. The Japanese are astounded that we win Alfred Denning prizes for quality manufacturing of auto-components amid all our chaos. The fact is, they shouldn't be. 







In Delhi's large diplomatic corps, the Mexican Ambassador appears to be one of the busiest envoys. Against the backdrop of two Presidential visits in the past three years, he has been handling several visits of Mexican VIPs. Evidently India-Mexico relations have been progressing well. To evaluate this progress and to celebrate the 60th anniversary of establishment of diplomatic relations between the two countries, Indian Council of World Affairs will hold a major bi-national seminar shortly.

Bilateral relations have recently been elevated to a 'privileged partnership'. It is a welcome approach even if the goal falls below 'strategic partnerships' that India has with other countries. 

Like India, Mexico enjoys a rich cultural heritage, dating back to ancient times. Travelling to many of its historic sites, I was struck by strange similarities between symbols of Mayan civilisation on the one hand and Indus Valley and Aryan civilisations on the other. This has led some to argue that cultural contacts existed in the earliest phase of history. Most scholars, however, would agree with Eva Alexandra Uchmany who, in India-Mexico: Similarities and Encounters throughout the History, advocated the view that exchanges between New Spain or Mexico and India and South East Asia began only in the colonial period and intensified in the 20th century. Chilies came to the sub-continent from Mexico which received the gift of tamarind from India. In modern times, Mahatma Gandhi and Rabindranath Tagore influenced Mexicans. In turn, ideologies and art of Mexico impacted on us through political thinker MN Roy and artist Satish Gujral.

Following independence, India began re-discovering Mexico. Prime Minister Jawaharlal Nehru chose Vijaya Lakshmi Pandit, his sister, as India's first Ambassador to Mexico which reciprocated by sending Emilio Portes Gil, a former President, as the first Mexican Ambassador in India. In the long chain of Ambassadors from both sides, no one, however, came close to matching the scholarly creativity and fame of Octavio Paz, Mexican Ambassador in Delhi during 1960s. He emerged as a highly respected interpreter of India's political, cultural and social facets, to audiences at home and abroad. His works including In Light of India are still considered a mandatory reading in many parts of Latin America. 

After Nehru's visit to Mexico in 1961, a lull descended. This was broken by the mother-son duo: Prime Minister Indira Gandhi's visit in 1981 was followed by Rajiv Gandhi's still-remembered visit in 1986. Mexico's supply of special varieties of wheat and relevant technology symbolised its invaluable contribution to India's 'Green Revolution'. Between early and mid-1980s, two Mexican Presidents came to India, and President Zail Singh visited Mexico, but thereafter both countries got distracted to other priorities.

During my time as Ambassador in Mexico City, a fresh endeavour was made to re-commence VVIP exchanges. President Vicente Fox had visited China a number of times, but somehow he could not find time for India. Fortunately, the Indian side was in close touch with a leading presidential candidate, Mr Felipe Calderon, even though his prospects looked feeble at the time. Mr Calderon's top advisers expressed strong interest in imparting fresh momentum to bilateral dialogue. His razor-thin victory paved the way for launching a new phase in the old relationship. President Calderon's visit to India in September 2007 (after a gap of 22 years) and President Pratibha Patil's visit to Mexico in April 2008 came through in this context. 

Political relations are excellent today. A long history of the two countries working together as part of UN, G77, G20 and G5 etc has ensured consensus on many issues, especially those pertaining to North-South issues. But subtle divergences are notable, for example, on the critical issue of UN Security Council reform. Further, G5 having been virtually subsumed in G20 now, there is hardly any other small grouping with both India and Mexico as members. In contrast, Brazil and India are members of IBSA, BRIC and BASIC. As India joins the Security Council as a non-permanent member shortly, Mexico will hand over its seat to Colombia. Hence there is a need to strengthen the bilateral channel for dialogue and coordination. 

Economic dimension is becoming stronger. Bilateral trade has increased from about $1 billion in 2003 to about $3 billion in 2008. The target of $5 billion by 2010 seems achievable. Indian companies have brought new investments to Mexico, attracted by the powerful pull of Mexican market and its role as a gateway to the US as well as Central and Latin America. What Mexico needs to do is step up its trading linkages and investment presence in India.

During my tenure, two significant constraints were identified by our Embassy team. The first was the restrictive visa regime followed by Mexico towards visitors from India. An effective campaign was launched which resulted in considerable improvement, especially for business visitors. The second was absence of a bilateral business chamber. This was rectified by establishing Mexico-India Business Chamber at Embassy's initiative and with encouragement from Foreign Minister Luis Ernesto Derbez. It is gratifying to note that MIBC has been successful as a catalyst in expanding business links. 

Cooperation in other fields including science and technology, culture and education is important too. Presence of Mahatma Gandhi's statues in several Mexican cities is noteworthy. Standing before the Gandhi statue in Mexico City, President Patil observed: "They (ie Gandhiji's principles) are as appropriate in India as they are in Mexico." During Mr Calderon's visit, the cultural dimension received much prominence. An exhibition each of pre-Hispanic art in New Delhi and works by Juan Soriano in Mumbai, timed with the visit, brought to our people the vast richness of Mexican art. 

Looking to the future, two suggestions merit consideration. Reviving the tradition set by Nehru, our Prime Minister should consider undertaking a bilateral visit to Mexico. The second suggestion is to examine seriously an idea put forward in 2008, that India should adopt a broader, institutionalised approach for deepening relations with Latin America as a region. India-Africa Forum Summit model may be worth emulating. 

--The author is a former Indian Ambassador to Mexico.







People love historical analogies, so it's easy to think of Ms Aung San Suu Kyi's release from house arrest on Saturday as Burma's "Mandela moment". When Mr Nelson Mandela was freed from 27 years of imprisonment in 1990, it marked the start of a process that saw the negotiated end of the apartheid regime and genuinely free elections in only four years. Maybe that sort of thing will now happen in Burma too.

That would be nice, but it would be unwise to bet the farm on it. "The Lady", as everybody in Burma calls her, has the same combination of saintly forbearance and tough political realism that enabled Mr Mandela to lead the transition to democracy so successfully in South Africa, but her situation is very different. 

Mr Mandela emerged from prison to assume the leadership of a powerful, disciplined mass movement, whereas Ms Suu Kyi must start by picking up the pieces of a party that has split and lost focus during her seven years of house arrest. Its leaders are almost all elderly men, and there is no younger generation of leaders in sight. 

South Africa was utterly isolated politically, and its economy was crumbling under the impact of sanctions. The Burmese regime has diplomatic relations with its trading partners in South East Asia and a very powerful supporter in China. Burmese living standards are dramatically lower than those in neighbouring countries due to forty years of corrupt and incompetent military rule, but the economy is growing. 

And the most important difference: When South Africa's President FW de Klerk freed Mr Mandela in 1990, he already knew that the apartheid regime was doomed. He wanted to negotiate a non-violent transition to a democratic system that would preserve a place for South Africa's white minority, and Mr Mandela was the best negotiating partner he could hope for.

The regime that has just released Ms Suu Kyi, by contrast, does not think it has lost, and a transition to a genuinely democratic system is the last thing on its mind. It has just finished an elaborate charade of elections (nine-tenths of the candidates were Government-backed) under a new constitution (one-quarter of the parliamentary seats are reserved for the armed forces). It already has all the democracy it wants.

Why did Burma's military rulers even bother to construct a pseudo-democratic facade like this? After all, their power really rests on their willingness, demonstrated again only three years ago, to kill unarmed civilian protesters in the streets. They don't care about being loved, so long as they are feared.

But they are as concerned about preserving the country's independence as any other Burmese, and that makes it desirable to end Western sanctions against the regime. They are hugely dependent on China as an investor and a market for their raw materials, and that is not a comfortable position for any Burmese to be in.

"When China spits, Burma swims," says the old proverb. If Ms Suu Kyi can persuade the Western powers to end sanctions against Burma — and she has already hinted that she will help — then the regime can use better relations with the West to counterbalance China's overweening influence in the country.

Obviously, the regime is betting that it can use "The Lady" in ending sanctions without risking its own hold on power, and perhaps it is right. She faces a hard task in rebuilding her party, which split over the question of whether to participate in the recent bogus election. Even if she succeeds, the Generals can always arrest her again and lock her away for as many years as they like. Who would stop them? But they could still lose their bet.

The citation for Ms Suu Kyi's Nobel Prize in 1991 called her a shining example of "the power of the powerless", and that power is real. It could be seen in the adoring crowds who came out to see her when she was freed: After seven years of invisibility, her appeal to two generations of Burmese who have lived under the boots of the military regime all their lives is undimmed.

Like Mr Mandela in apartheid South Africa, or Vaclav Havel in Communist Czechoslovakia, or Mohandas Gandhi in colonial India, she is a realist about power and fear. "People have been saying I know nothing of Burmese politics," she said when she was first drawn into politics during the non-violent protest movement of 1988. "The trouble is, I know too much." And the 1988 protests were duly drowned in blood.

But she also knows that Mr Mandela and Havel and Gandhi eventually won. They all had to accept that the guilty would go unpunished, for otherwise the outgoing regime would fight until the very last ditch. They also understood that negotiating with the enemy is necessary, and so does she. As she said in 1997: "I would like to set strongly the precedent that you bring about political change through political settlement and not through violence."

Despite all that, those other heroes of non-violence got what they were really struggling for in the end: A free and democratic country. And Ms Suu Kyi could ultimately achieve that too, even though it is hard to see from here the precise route that might lead her to that goal.

--Gwynne Dyer is a London-based independent journalist. 








In a media briefing, Japan's Deputy Chief Cabinet Secretary Tetsuro Fukuyama, who was present at the Hu-Kan meeting, gave the following Japanese version of the meeting: 


  He believed the talks marked a "big step forward" in improving the two nations' ties. 


  Mr Kan and Mr Jintao shared the view that "development of long-term, stable strategic, mutually beneficial ties is of benefit to both countries' people and is also extremely important to peace and development in the region and the world". 


  The two leaders also agreed to further expand public and private sector exchanges and strengthen cooperation in economic and other global issues in the light of the discussions at the APEC and G20 talks. On the Senkakus, Mr Kan was the first to touch on the matter, "clearly" conveying to Mr Jintao Japan's "firm position" on the islands. Mr Jintao also conveyed China's position on the islands. Mr Fukuyama refused to elaborate the position taken by the two leaders. 

  Mr Kan again mentioned about restoring Japan-China ties to where they were in June. Mr Kan's previous face-to-face meeting with Mr Jintao took place on the sidelines of the G20 summit in Toronto in June, during which they agreed to enhance strategic, mutually beneficial relations. 

The meeting between Mr Jintao and Mr Kan was followed the next day by a meeting between Chinese Foreign Minister Yang Jiechi and his Japanese counterpart Mr Maehara. According to a Chinese Foreign Ministry spokesperson, Mr Jiechi and Mr Maehara agreed to implement the agreements reached between Mr Jintao and Mr Kan by firmly sticking to the direction of developing China-Japan relations and safeguarding the overall interests of bilateral ties. The spokesperson said that the two Foreign Ministers agreed that China and Japan should adopt positive measures to enhance friendly feelings between the two peoples, boost practical cooperation, and improve bilateral relations.


Japan's Kyodo News Agency said Mr Maehara, in his talks with Mr Jiechi, urged China to reopen talks on developing the natural gas field in the East China Sea, while Mr Jiechi took a cautious stance and said a proper atmosphere should be created first. The news agency added that the two Foreign Ministers also agreed to cooperate on the goal of nuclear non-proliferation on the Korean Peninsula and on tackling global warming and striving to further develop their strategic and mutually beneficial partnership.

It has been reported that following the talks the Chinese authorities have promised to expedite customs clearance of pending shipments to Japan of rare earths, but have not given any assurance of removing the quantitative cuts in their exports in future. The Japanese electronic industries are almost totally dependent on imports of rare earths from China. The quantitative restrictions and the slowing down of the customs clearance of pending consignments were resorted to by Beijing as an act of reprisal for the Japanese action in detaining the Captain and other crew members of the Chinese fishing trawler. Even after the Japanese Coast Guard released them, China did not withdraw these measures. While it is now apparently willing to expedite the customs clearance it has stuck to its quantitative restrictions. Japan has reportedly sought the supply of rare earths from India and Vietnam. While they have reportedly agreed to consider the Japanese request, this is not for tomorrow. Their production is miniscule compared to China's production, which meets 97 per cent of the global requirements.

Concern over the possibility of the US exploiting the differences of China with its neighbours has definitely introduced a re-thinking in the Chinese policy towards its neighbours. This does not mean any Chinese concessions on the question of territorial sovereignty. The Chinese give indications of toning down their rhetoric and restoring harmony in their relations with their neighbours. It is interesting to note that the recent writings in China on the need for a more accommodating policy towards its neighbours in order to pre-empt the perceived US designs to drive a wedge between China and its neighbours does not make any reference to China's pending border dispute with India. India's policy of bilaterally settling its disputes with China and Pakistan without allowing any third party role has given confidence to the Chinese that despite the closer strategic relations between the US and India, Beijing does not have to fear any US meddling in the border dispute. 

--The writer, a former senior officer of R&AW, is a strategic affairs commentator.









With HRD minister Kapil Sibal assuming temporary charge of the IT and communications ministry, the decks have been cleared for investigative agencies to probe the Rs 1.76 lakh crore 2G spectrum scam. They should now take matters to their logical conclusion by nailing anyone who's found guilty, no matter how high. It is now clear that systems and procedures were blatantly manipulated to benefit a handful of companies, some of which had little or no experience in telecom. Precious spectrum was allotted at throwaway prices and companies that won licences offloaded shares for huge profits. That such a sunrise sector is susceptible to vicious corruption is a matter of serious concern. A thorough investigation of the reasons behind this susceptibility is imperative to safeguard the sector from dubious dealings. 

At the heart of the problem is the scarcity of spectrum. Given rapid innovations in technology, the demand for telecom-based products such as mobile banking, mobile retail and education modules based on the mobile delivery model is slated to soar. All of this requires a significant amount of spectrum. One of the main reasons for the shortage is that the defence forces are sitting on a huge amount of it. Not only does this raise the cost of spectrum for telecom companies but also incentivises manipulations. In that sense, the 2G spectrum scam is not unlike the land scams that have been making the news. A proper audit of the actual amount of spectrum available is the need of the hour. Only then can policies be formulated to rationalise the use of spectrum for civilian and defence purposes. 

Shady deals in the telecom sector can also be attributed to the way the telecom ministry has come to be viewed over the years. The portfolio has become a bargaining chip for those in power to entice allies. This is particularly true of the Congress-DMK arrangement at the Centre. Things cannot be allowed to continue along the same trajectory. Given that the health of the telecom sector impacts the health of the larger economy - a relationship that is set to grow stronger in the coming years - the portfolio needs to be entrusted to someone who is clean, managerially efficient and has a sound understanding of the telecom revolution. Sibal could be the right person, but he has too many portfolios to juggle which isn't sustainable over the long term. 

At present, however, a thorough clean-up is the need of the hour. The 
CAG report on the scam has found serious problems with 85 of the 122 licences given. A beginning could be made by cancelling these licences and calling for fresh auctions. Probity is key for the future growth of the telecom sector.







"A living language...Got to celebrate it!" said US Republican Sarah Palin about English. Analysing trends in word usage, Texas-based Global Language Monitor (GLM) suggests the planet's 1.58 billion English-speakers did just that when tracked for 2010's top words, phrases and names. How else would "vuvuzela" - hardly in verbal currency till World Cup South Africa - crash the global English lexicon? A loud horn blaring "the sound of Africa", vuvuzela is trounced for the "top word" spot by the equally evocative "spillcam", an underwater camera recording images of the Mexican Gulf oilspill. Now, this disaster did the environment the kind of serious damage vuvuzelas wreaked on the eardrums of suckers for soccer. But let's not "refudiate" Palin's own contribution to the malleable glory of English. Her Shakespeare-style joining of "refuse" and "repudiate" is also a winner. 

That's telling, given voter 'refudiation' of the Democrats in the US midterms. "Obamamania" - among the top phrases last year - has been outstripped by "Tea Party", America's hardline conservative challenge. Nobama, you can't ignore popular "anger and rage" - 2010's winner phrase - over "the Great Recession", a close follower. Nor can we ignore a recent Forbes' power list that made China's prez Hu Jintao world No. 1. GLM also asks 'knock, knock, Hu's there', only to find "Hu" is 2010's top name! Clearly, the planet is no longer Uncle Sam's cabin. Its pockets full of undervalued yuan, cupboards full of US treasury bonds and factories full of overseas orders, the dragon's going places the eagle once used to land. Why, even din-raising vuvuzelas are "Made in China"! But hold it. "Simplexity" may be one of 2010's top words, yet the world is more complex than the 'slouching eagle, no-longer-hidden dragon' script suggests. Gawking at a yearly Who's Hu? Well, "Obama" is right up there among the top three words of the decade.








Time will tell if the change of guard in Maharashtra's leadership marks an inflection point in the state's troubled political history. Cynics, of course, will point to a tradition of disappointing continuity and systemic failure impervious to cabinet reshuffles or replacements. They may be right. But if anyone can disabuse them of that notion and make a course correction, it is the newly-appointed chief minister, Prithviraj Chavan. His process-driven management style will be a shot in the arm for a city and state wracked by bureaucratic inertia and inefficiency. To be sure, his experience of having been a part of two coalition governments at the Centre will be tested as he navigates the corridors of shared power in the state. Restoring public confidence and changing perceptions, however, will likely be his immediate priority. For that to happen, the well-worn mantra of 'good governance' will have to be actualised and not just trotted out as an aspirational ideal. 

Recent events such as the Adarsh Housing Society and Karnataka's murky mining mess underscore the discernible governance gap between the Centre and state. Notwithstanding the pushes and pulls of coalition politics, central governments are generally more transparent, effective and responsive than many state-led ones. In relative terms, there is also a qualitative difference between national legislators and local politicians. Crony capitalism, nepotism and opaque processes of governance are turning states into gravy trains fuelled by embezzlement and fraud. With blatant disregard of an obvious conflict of interest, a housing minister is a real estate developer in one state and a senior cabinet minister is part of the mining mafia in another. 

The real travesty, however, is that scandals and scams are uncovered when the damage is already done, and almost always by the media. If the principles of good governance are in place, inbuilt systems of checks and balances should prevent, or at the very least detect, corrupt and mala fide practices in their early stages. Alleged scams like Adarsh Housing Society in Mumbai actually have less to do with violations of the law than impropriety on the part of public servants who ought to be above suspicion. Thankfully, in the Congress party, the latter is sufficient to warrant action even in the absence of legal clarity. In any case, citizens have little faith in independent inquiries that often outlive both their usefulness and the actors involved. 

In a utopian world, governance reform at the state and local levels would bring governments in line with the principles of transparency, accountability and respect for human rights and the rule of law. But that simply won't happen in the absence of political will and voter awareness. Mumbai's middle class, for instance, is largely disinterested in local elections. Most citizens wouldn't even know who their municipal corporator or MLA is but expect their MP to deliver on civic issues. Activists have an important role to play in educating people about the demarcated roles of elected representatives. If Mumbaikars paid half as much attention to the BMC's and Maharashtra government's budget speeches as they do to the Union budget speech, local governance may improve. The media too has a role in covering local issues. 

There is consensus amongst economists that India could add as much as 2 per cent to an already high rate of growth if it improves the working of government. Rapid urbanisation is shaping an economy where services represent more than half of gross domestic product. A recent study by McKinsey, titled 'India's Urban Awakening: Building Inclusive Cities, Sustaining Economic Growth', analyses the challenges and opportunities presented by urban India. Between now and 2030, the report estimates, a staggering 250 million Indians will migrate to the cities. As a result, India will have 68 cities with populations of more than one million. The report further calculates that over the next 20 years, 70 per cent of new jobs in India will be in urban areas and that the cities' share of gross domestic product will rise to 70 per cent from 58 per cent. Managing this transformation well is a challenge state governments have to square up to. 

This is precisely why Maharashtra's political leadership must summon the political will to repair Mumbai's creaky infrastructure and halt its inexorable decline. Far from becoming a world-class city, poor governance, haphazard planning and lack of vision have impeded its development. The process of reviving Mumbai and accommodating its migrant influx should be driven by structural and institutional reform, such as devolving Mumbai's governance to a directly elected mayor. Additionally, the BMC as the country's richest civic body must become more accountable and transparent to the public. 

In a speech at a leadership summit last November, Prime Minister Manmohan Singh revealingly said, "Real change in India will come when we get the right kind of state level and local leadership - a forward-looking, modern and compassionate leadership that strengthens the foundations of our great republic." 

India's participative democracy is a work in progress and while civil liberties and individual freedoms are far more entrenched in civil society today than ever before, they are still episodic and selective in their application. A better-informed and engaged citizenry is undoubtedly a powerful driver for social change. But until politicians realise good governance is also good politics, the change we wish to see will remain elusive. 

Deora is a member of Parliament and Dhanrajgir is a public policy associate at the Netherlands Institute of Human Rights.







James C Dabhi is country director of Afghanistan Research and Development Institute in Kabul and visiting professor at universities in Bamiyan and Herat. Dabhi, a former executive director with New Delhi-based Indian Social Institute, spoke to Humra Quraishi about the challenges of working in Afghanistan: 

Why did you, a Jesuit priest from India, opt to work in Afghanistan - a war-torn Muslim country? 
As a Jesuit, I think my primary calling is to work and contribute to social justice and human development. So much of anti-Muslim feelings and behaviour is generated because of some events and actions of a few people. For the actions of a few, entire communities are blamed, badly treated and their national identities, loyalty and love for humanity are doubted. In such a situation, I think that greater Jesuit engagement in social research, education and development in Muslim countries is required. I am from Gujarat and I have seen religious extremism. To me Afghanistan was something similar in a different setting. 

You've been in Afghanistan for two years now. What's your impression of the country? 

Education, infrastructure, agriculture and overall awareness about peace and justice have increased. There are more girls and women in schools and universities and public life than before. Some voices in the media highlight the gender injustice, corruption, ethnic discrimination, drug economy etc. 

The Taliban, the warring factions within Afghanistan, the US, the UK and allied forces have thrust the war on the people. The international community and UN agencies despite their limitations have done good work. However, they have to improve their efforts and prepare the locals to take over the responsibilities in the years to come. 

Afghanistan's neighbours must stop using that country for their interests at the cost of the local people. There is hardly any civil society here in Afghanistan to resist and raise its voice against the vested interests within and outside. Eliminating enlightened civil society members is not a big deal here. Like in India many of the religious leaders here often are part of the problem than the solution. Newspapers are a luxury here and limited to major cities. So access to news is through radio, television and mobile phones. So protests against civilian deaths are limited. 

Could there be a peaceful way to clear this mess in Afghanistan? 

To be honest it does not seem to be possible in the near future. Afghanistan presently has its own 'elected government' but it is no secret that it is governed and managed by a combination of internal and external actors, interests and political compulsions. The legacy of warlords, the feudal and patriarchal ways of local governance, corruption, ethnic rivalries, family and clan networks all play a role in the politics and economy of Afghanistan. 

People show their dislike for religious extremists in private but they are afraid to say it openly. Many people also detest the presence of foreign forces, particularly the US, yet they know the consequences if these are moved out immediately. Many people are dependent on the international community for their livelihood. Afghanistan currently relies on aid to meet 90 per cent of its budget. 

The Taliban is not the only actor responsible for the insecurity. The warlords, drug mafia, transport lobbies, timber mafia, security companies (foreign and local), politicians and bureaucrats, business rivals, neighbouring countries and other international players, all have their share in creating and sustaining insecurity. Insecurity is also a blessing in disguise for NGO personnel including the UN bodies. It may restrict their movement but it increases the 'risk allowance' attached to a fat salary substantially.







The real culprit behind the Adarsh scandal is not the army. The real culprit is the criminally high cost of land in urban India. Frequent news reports seem to gloat over the fact that real estate prices in south Mumbai, for instance, are comparable to, or even exceed, land costs in Manhattan or Tokyo, despite the fact that both the US and Japan are far richer countries than India. 

Far from taking pride in the prohibitive price of our urban land, as our press is inclined to do, we should deplore it and find ways of bringing it down. The astronomical value of prime real estate encourages scams, as in the case of Adarsh, precludes common citizens from owning or renting residential accommodation in urban centres, and increases the cost of doing business in India: the high overheads of office and retail space are a major disincentive for entrepreneurs setting up shop in India. 

Why is land - urban real estate - so expensive in India? The obvious answer is that India is an overpopulated country. The growing demands of a rapidly increasing population has created an inevitable shortage of supply, the consequences of which are impossibly high prices. Fair enough. But Holland, to take one example, is a more densely populated country than India. Yet the price of real estate in downtown Amsterdam, say, is less than land rates prevailing in Colaba or Lutyens' Delhi. 

One of the main reasons - perhaps the main reason - for the high cost of urban Indian real estate is the Operation Land-grab mounted by the government ever since Independence. The armed forces reportedly hold a total of some 17 lakh acres of land across the country; the sarkar in its entirety holds many times more than that. If you take all the government landholdings - central and state government offices, residential accommodation for politicians and bureaucrats, and various emporia and exhibition grounds - the sarkar is the single biggest landlord in the country. 

In New Delhi, ministers and other netas occupy Lutyens' bungalows the market value of which is estimated at some Rs 150 crore. Often, even after their demise these personages continue to occupy their official residences which are converted into museums in their honour. Lower down the sarkari pecking order, bureaucrats get heavily subsidised housing, often in the most desirable residential areas, which become so costly as a result that you and i can't afford to live in them.

In no other democracy do politicians and babus get free, or almost free, housing: the American president lives in the White House, everyone else must find their own accommodation. If the Indian sarkar were to take a tip from the US, only Rashtrapati Bhavan would be retained to house the incumbent president. All other government residences - in Delhi and elsewhere - would be freed, significantly increasing the supply of urban real estate and bringing down its price - and the incidence of greed-induced scams that artificially high prices generate. 

But if the sarkar were to vacate city centres where would it go and how would it run the country? In the 1950s, the then chief minister of West Bengal, B C Roy, in order to decongest Calcutta, tried to move the government bureaucracy to the new township of Kalyani, specially created for the purpose, a hundred or so kilometres from Calcutta. However, the citified babus dug in their heels and Kalyani became a ghost town before it was fully born. 

Perhaps in the dawning era of e-governance it's time to revisit the Kalyani approach and develop live-in sarkari townships away from urban centres, which would be made accessible to the open market. As government departments get progressively computerised the sarkar should be able to do its work without having, literally, to sit on the heads of citizens. Won't happen, of course. But if it did, Anil Ambani could well become the new resident of New Delhi's 7, Race Course Road, to rival in grandeur brother Mukesh's Antilla high-rise in Mumbai. 







A residential building in an unauthorised but regularised colony collapsed in New Delhi  late evening on Monday. More than 60 people were dead at the last count and around 80 have been injured. After the incident, the Delhi chief minister said the guilty would be punished. We've heard that before. Going by past experience, it's unlikely that the probe will get too far because the list of the guilty could include many within her administration. As of now, the owner of the five-storey house is absconding. Like us, he too understands, that in the end, he will be the scapegoat. But the truth is, he could not have come this far without the help of corrupt government officials who never raised a red flag when the illegal building came up in the first place. Some reports say the building, supposedly a residential one, also housed a cloth-exporting company and a food snacks group. We wonder if the building had permission for commercial activity or the requisite fire clearance certificate.


In a way, recent accidents like this one or scams like the Delhi Commonwealth Games and Adarsh in Mumbai have once again underscored the deep links that exist among officials, the construction industry and politicians. Newly-constructed bridges collapse, brand new airport roofs develop leaks and as, the Delhi incident shows, buildings cave in like a pack of cards. The most alarming fact is the disturbing regularity with which all this is happening. A scam here or a scam there has become par for the course. It only shows how corroded our governance system has become.


The rot starts from the day the foundation of a building, in many cases weak, is laid. First, illegal buildings are allowed at a price. Then after a few years, they are regularised — again at a hefty price. Come elections, the question of illegal quarters always comes up for discussion. Politicians use the promise of regularisation of illegal colonies as a sop in exchange for votes. But never do departments concerned make a survey of the status/quality of the buildings before legalising them. Now the CM and lieutenant governor have said a survey of the area would be conducted and any building found unsafe would be demolished. Is this proactive or reactive governance? Delhi, like Mumbai, is a magnet for people from other states. The city authorities know this well but have struggled to provide space for people. Naturally, encroachment is seen as an easy way out. And safety takes a backseat, often with fatal consequences.







You are about to go out of town. You alight from you car at, say,  the tony T3 terminal, get your bags out and hand them to a polite porter who puts them on a trolley. You scan the screen, proceed to your counter, check in and whiz through immigration. You then go along the smooth walkalator, your strolley gliding behind you and before you can say Jack Robinson you are in the lounge sipping a campari awaiting your departure call. Good grief, what a nightmare.


Thank god, reality is nothing like this. No, you alight only to escape being mowed down by a SUV, Jairam Ramesh notwithstanding, behind you. You lug your luggage onto a trolley on which the wheels are stuck. You race around like a headless chicken looking for your counter. The walkalator is not working so you drag your strolley over a dense carpet with motifs done by a Dali gone mad until you reach your gate only to find you are at the wrong one. Now that's more like it. Chaos is the cornerstone of our lives. Be it our railway stations, airports or any public place, nothing can proceed smoothly. All proceedings must be accompanied by breakdowns, hysteria, shoving, jostling and the screaming of oaths and imprecations. The only good thing about most airports is that there is poor connectivity so we can be spared the horror of our co-passengers yelling inanities into the phone while we are trying to recover our wits.


Some nations are born to orderliness, we revel in muddling along. If that does not suit you, we recommend that you stay home. In fact, the manner in which people actually catch flights despite the mayhem could be the theme of a reality show. Perhaps, we could get Rakhi Sawant to wait at the entrance and scream abuses at passengers just to spice up the whole thing. That should see the volume of passenger traffic going up.








The first time Jairaj Phatak made me think of my late father was a couple of years ago. As Bombay's municipal commissioner then, he announced that he would stick to a 1966 government regulation (GR), stating that all official communication would be in Marathi. Fine, good decision. And what about people who don't understand Marathi? In a Hindustan Times report (Now, only Marathi in BMC, June 7, 2008), Phatak said this: "It is simple, the script is the same as Hindi".


I was elated. For I realised that contrary to any previous impressions I might have had, I actually understood Konkani, Nepali and Sanskrit, for all of which the script is the same as Hindi. Not just that. I also realised that I understood Spanish, French, Irish, Gaelic, Welsh, Italian, Polish, German, Latin, Turkish, Portuguese, Dutch, Danish, Flemish, Afrikaans, Malagasy and several more languages, for all of which the script is the same as English (which I understand).


Simple as that. No, actually I wasn't elated.


So why did Phatak make me think of my father? Because my father, JB D'Souza, was once municipal commissioner of this great metropolis too. But not once did he say something like this. Perhaps the 1966 GR wasn't a bone of contention during his term, so let me put it this way: I cannot even imagine him saying something like this.


JB died in September 2007. He had a long and what he always described as a fascinating career in the IAS. Apart from his stint as municipal commissioner, he served as general manager of BEST, managing director of City and Industrial Development Corporation of Maharashtra when they began planning New Bombay, Maharashtra's chief secretary and finally secretary in the housing ministry in Delhi. I list these not so much because they form an impressive record, but because he found most of those jobs all-absorbing, all-consuming. He used to tell us that what motivated him was hardly promotions and the like, but the chance to do interesting work while serving the public, and in so doing to earn the respect of his peers.


Now I am not one for singing the praises of my late father, and even saying as much as I have about him makes me squirm as I type, as it would make him squirm. But when Phatak's name cropped up in the news about the Adarsh building scandal, he got me thinking about JB for the second time.


For among those who have been allotted flats in Adarsh is Kanishka Phatak, son of Jairaj Phatak. Not that he's the only such. The Adarsh flat owners' list includes the children of DK Sankaran (like my father, once chief secretary of Maharashtra), Uttam Khobragade (like my father again, once GM of BEST), Ramanand Tiwari, CS Sangitrao, SC Deshmukh and PV Deshmukh. Apart from this bonanza for the offspring of Indian bureaucracy, I won't even mention the spouses of bureaucracy, the various defence officials, the politicians of every party who own flats in this building. I also won't mention the various reports that spell out how various clearances Adarsh sought sailed through our otherwise notoriously sticky bureaucracy: for example, as municipal commissioner, Phatak was instrumental in allowing the building, originally meant to be six storeys high, to reach 31 storeys.


The bureaucrats in Adarsh will no doubt produce all kinds of explanations to show they did nothing illegal concerning the building. But they forget that that's hardly the point. When you are in public service, you are a servant of the people. You answer to the people. You answer to an old-fashioned notion called "propriety". That means you don't do things that will raise questions later. That means, yes, no favours for sons and wives and daughters and mothers-in-law, period. That means your primary concern is the public interest, period.


So in reading about Adarsh, what strikes me is the lesson my father taught well: being the son of a senior bureaucrat got me no favours. This was clear early, when he would not let his official car take us anywhere, unless he was in it travelling to or from work and we could be dropped off en route. There was the day when it poured as school ended. I found a phone and called him to ask if he could send the car to take me home. He said: "Walk". But I'll be drenched, I wailed. He said six more words: "You can dry off at home." It seemed cruel. But I was dry before he got home, and then I grew to appreciate and respect the example he set.


When he died, The Guardian carried an obituary for JB. It had this line: "In the gigantic heap of pestilential and growing venality which passes so often for the Government of India, he was one … who remained, despite all odds, dedicated to the idea of public service, a notion becoming almost quaint in modern India's world of swashbuckling capitalism, the fast buck and devil-take-the-hindmost".


It made me proud, sure. But it made me yearn for quaintness once more: whether with flats in fancy buildings or with the language of official communications.


Dilip D'Souza is a Mumbai-based writer and journalist. The views expressed by the author are personal.







In recent years, the idea of serving the bottom of the pyramid has become synonymous with social entrepreneurship. The central theme of social entrepreneurs is to create access to essential services and products for underserved communities — rural or urban, below or above the poverty line, young or old, men or women or people with disabilities.


Access enables equal opportunity, which is the platform for inclusive growth. The rise of the Indian middle class was a result of the transformational power of access. The Green Revolution, deregulation, and subsequent pro-growth policies in the 90s opened up markets and opportunities for millions of families, enabling them to emerge as the new resurgent Indian middle class. The job is, however, far from done. We still have an astounding 400 million people who need to feel secure about their future.


As member, Planning Commission of India, Arun Maira recently said, "In India, it's not only the pace of growth that will impress people, but also the pace of their inclusion in it." Those who are being left behind, including tribals, don't want to be mere passive beneficiaries of state handouts and corporate philanthropy. They want to be respected, earning their own incomes and growing their own wealth."


Increasing the pace of inclusive growth will require increased access to underserved communities to participate in the market, either as entrepreneurs, consumers or employees. No one wants to be a passive recipient of aid anymore. The good news is that access is being created in India everyday, for millions of people, by social entrepreneurs across the country. Ranging from organisations providing access to education(Hole in the Wall, Pratham, Teach for India), to small loans (DhanaX), to markets (ITC e-chaupal, Under the Mango Tree), to clothing (Goonj), to maternal healthcare (Lifespring Hospitals) to identity (Aajeevika Bureau), to employment (Mirakle Couriers, Net Systems (Nsyst),, RuralShores). Some of them are established and have national footprints, some are start-ups, while others have impressive regional or local presence.


Not only is the sheer number and diversity of social enterprises that have emerged in the last decade encouraging, but the fact that several among them are led by young social entrepreneurs also gives us hope for India's future. The recently-launched National Social Enterprise Forum is one such initiative that engages, identifies and encourages social entrepreneurs in university campuses across the country to become change-makers.


Building and sustaining a social enterprise, however, remains a challenge. Access to capital, human resources, and the lack of a broader ecosystem to support growth are the biggest deterrents that social entrepreneurs face. The Schwab Foundation for Social Entrepreneurship offers a solution by connecting social entrepreneurs to an international ecosystem and giving them global platforms to scale.


As an enabler and policy maker, the government can play a key role in stimulating inclusive growth by supporting social enterprises. The time is ripe for an 'Office of Social Entrepreneurship' in the government along the lines of American President Barack Obama's Office for Social Innovation and English Prime Minister David Cameron's proposed 'Big Society' to encourage, facilitate and fund social enterprises. The OSE can connect, fund and facilitate thousands of social enterprises and can help codify elements of success that could be transferred from one enterprise to another.


A vibrant community of young social entrepreneurs with their innovative ideas and exuberant spirit with proactive support from the government is required for inclusive and sustainable growth. Many say that India is a 'limited access country'. With a new breed of social entrepreneurs, now is the time to transform ourselves into an 'infinite opportunities nation'.


Ashwin Naik is co-founder of Vaatsalya Healthcare Solutions. The views expressed by the author are personal.







We would like to but we can't do it — maintain a strict dividing line between home and office. Many of us fool ourselves that we leave office behind once we head for home. But the truth is that most of us carry the baggage home and brood, plot and plan endlessly to get ourselves a better deal and get the better of colleagues and sometimes, our bosses.


Let's be realistic, the boss is not going to change for you. You don't want to change for the boss. There is, as all philosophers will tell you, a middle path. You must learn to calibrate the situation to your advantage. In my workshops, I have dwelt at length on this aspect.


So who is a boss?


Someone who has more power than you. Someone who has the ability to make you do what you may not want to do. Bosses can be well-intentioned and ill-intentioned. They could be more or less intelligent than you.


The well-intentioned boss is concerned not only with his own wellbeing but that of others in the team as well as that of the organisation. The ill- intentioned boss invests most of his energies in scoring personal agendas. The most difficult of them all are the intelligent — ill-intentioned bosses. I like to call them the Shakuni variety. Not only will they use and abuse you but will also harm your self-respect and self-esteem. Shakunis are best handled by a sensible alignment to their goals and well-timed negotiations. All that they want from you is 'buck up or suck up'. If you are stuck with them, then make the most by learning from their sharp intellect.


The best bosses are the Krishna bosses, well-intentioned and more intelligent than you. One should never be scared of confronting these bosses during conflict situations provided you have done your homework well. With such bosses meritocracy wins, principles win and ego is never an issue.


Duryodhana bosses who are ill-intentioned and not so competent are best handled if you trade your competence with their power. That way they realise how balance of power must be maintained for a symbiotic relationship. They will not trouble you as long as you keep showing to them how indispensable you are to them. The Yudhisthira bosses, well-intentioned but not shrewd, give you ample space to experiment and grow. Use that opportunity to sharpen your initiative and take risks.One of the standard pastimes in my workshops is boss bashing. This is counterproductive in the workplace. Rather than directing one's psychological energy towards backbiting, it may be a better idea to develop skills for handling the boss in balanced way.


Yadhav Mehra is a motivational trainer. The views expressed by the author are personal.








A law that disregards common sense, exists to be violated. In the late '80s and early '90s, India and China had emerged as the kidney transplant hubs of the world. The resultant Transplantation of Human Organs Act (THOA) of 1994 banned commercial organ transplants, allowing only transplants from brain-dead patients and donations from the immediate family — spouses, parents, children and siblings. This constriction of supply against demand made it almost impossible to find donors. Yet, India has hundreds of thousands of patients needing transplants; and organs in demand are not just kidneys but also hearts, lungs, livers, pancreases, and so on. The law, in fact, led to a booming black market, where desperately ill recipients and desperately poor donors were exploited by middlemen. The Gurgaon organ racket scandal was only symptomatic of this malaise that persists in all our big-city shanties.The government, on the reco-mmendations of the Standing Committee on Health and Family Welfare, has therefore made the correct move in deciding to amend THOA with an eye to streamlining organ transplants. The health ministry had, in the aftermath of Gurgaon, realised that regulation would be more effective than outright ban. Looking to simplify transplants and reduce the disparity between demand and supply, the amended law will bring within its ambit regulation of tissue transplants too. More importantly, it will expand the definition of "near relatives" to include grandparents and grandchildren. Besides, the "swap" option, allowing a donor-recipient pair who are near relatives but whose organs don't match to swap organs with another pair, is a helpful expansion of scope. Finally, easing another restriction, a foreign donor or recipient will henceforth be able to do with the authorisation committee's prior approval.There's much more to be done — generating public awareness on available options and social consciousness about transplants. The long-needed national registry of organs under consideration will help. But what's also needed is a behavioural change making people willing donors. Caught up in the bioethics of marketing organs is the plight of the poor — the focus of kidney rackets. Following this policy reform, there has to be action on our transplant infrastructure and on cadaver-based donation, with the additional aim of being able to presume consent for transplant unless objected to.







The stories will keep coming in. The two children playing in a nearby park who have lost their entire family — parents, sister, grandmother, uncle. The little girl, 18 months, who survived the fall, but with a fractured right hand — and repeats her own name, Tina, over and over again. Her mother had not yet been found. At least 200 people lived in the six-storey building in Lalita Park in East Delhi; more than 60 lives have definitely been lost in its collapse. This is the sort of horrific moment at which it is impossible to not feel anger at lax builders, at bribable local officials. There is, however, an even broader sense in which this should move us to demand action — to revisit the way in which we imagine the way we live in our towns. This building's residents were mainly recent migrants to Delhi, mainly from Bengal. Some of them were living a dozen to a room. Across India, our larger towns and cities have lakhs of people, often entire families, arriving in search of work and prosperity. But, as in this case, the "authorised" city has no place to receive them. They cram into the margins of our cities, in hastily thrown-up buildings with minimal regulation and oversight. That is a profound failure of governance, one which bears a large part of the responsibility for what happened on Monday. And the answer is not, by any means, to stem the tide of arrivals, or to increase the burden on already "authorised" building. To move forward wisely, we need to accept that the arrivals into our cities will not decrease — that they might well increase — and that we need to make it easier to construct proper residential spaces for them, not harder. In our cities today, the abundance of regulations and the difficulties involved in getting new, affordable real estate built means "authorised" building is often high-end, and lower-end housing is often unauthorised, and therefore a blind spot for government. Cutting through the red tape, extending government oversight to all housing, requires us to free up real estate.


Our cities are engines of our prosperity. They attract the hopeful from all over, like the hundreds in the Lalita Park building. Those hopeful deserve reasonable places to live while they work to make all our lives better. And to do that, we need to free real estate, by creating

a genuine market, by big-thinking extensions to urban areas, by thinking vertical. The day of the unauthorised colony must pass.








The trend began haltingly, in early 2000, when Tata Tea took over Tetley, the world's second-largest tea company — twice its size — for $450 million. Since then, however, Indian corporations have been on something of an acquisition spree, buying businesses overseas. One estimate puts the total bill for acquisitions by Indian companies abroad at $75 billion-plus over the last decade.


Among the bigger deals struck were Tata Steel's $12.1 billion buyout of Anglo-Dutch steelmaker Corus, Bharti Airtel's $10.7 billion acquisition of Zain, and Hindalco's $6 billion purchase of the Canadian aluminium firm Novelis. While some of the shopping was done in the first half of the decade, the tempo actually picked up in 2006, 2007 and 2008 when there was some frenzied buying before the Lehman crisis brought everything to a halt. Indeed, most of the acquisitions were made at a time when asset prices were near their peak but easy access to cheap money and peer pressure pushed companies into paying top dollar.


Indeed, India Inc's first big brush with global acquisitions left many bruised. And heavily indebted. Firms like Wockhardt, which piled up debt worth Rs 3,800 crore, have almost gone bankrupt after trying to buy half a dozen companies, and are expecting the banks to take a haircut and bail them out. GMR has put its stake in the power firm InterGen on the block. Others, like Dr Reddy's Labs, which coughed up $750 million for Betapharm haven't been able to extract the kind of synergy that they would have liked — and instead had to take a goodwill hit of about


Rs 1,000 crore. JSW Steel has had a hard time with the steel plants that it bought in the US for $800 million. At one time, Aban Offshore, which bought the Norwegian oil exploration company Sinvest, had a net debt of over 10 times equity. Even Baba Kalyani, the sharpest of negotiators, and one who picked up distressed assets at rock-bottom prices, had a tough time turning out the units during the global downturn. But Bharat Forge has managed to use the technology it acquired to improve quality and also acquired a clutch of new customers. In the process, companies like Hindalco and Tata Motors have had to sell shares at throwaway prices to keep their gearing in check; the price for that decision has been paid by their smaller shareholders.


It may have taken Sun Pharma three-and-a-half years to get control of the Israeli drug firm Taro, but one can't fault Indian corporations for wanting to become global players: that is clearly the way forward. Without a global presence, they will find it harder to scale up, acquire large customers and de-risk their business models. Also, while


ideally the buyer should pay a price that is below the target firm's intrinsic value, such opportunities are rare.


According to McKinsey, improving the performance of the target company is one of the most common value-creating acquisition strategies. Companies like Crompton Greaves, which managed to turn around its targets like Pauwels and Ganz in quick time, making them profitable, clearly justified their buys. Acquirers like Tata Motors, which bought the JLR — the Jaguar and Land Rover brands — have also been able to do that. JLR's sales soared nearly 58 per cent in the three months before September 2010, to £2.25 billion. Its operating margins were a firm 16.6 per cent, bettering the 15.5 per cent posted for the June 2010 quarter, and resulting in profit after a tax of


£238 million. Yet, under Ford's management, JLR was struggling. Indeed, the turnaround at JLR indicates how capable Indian managers are of running businesses overseas; Mahindra and Mahindra will be hoping to do just the same with SsangYong in Korea. It's true that many buyers may have overpaid in their eagerness to own foreign businesses, and that it will be a long time before the returns on those investments materialise. Nevertheless, the JLR turnaround has shown that the market, although it may initially seem wary of such initiatives, does reward management if it succeeds.


Indeed, Indian managements should be able to create value from their targets because they are used to operating in fast-growing, fiercely competitive markets at home — and most importantly, have been able to manage labour in alien environments. As long as they're pursuing cross-border opportunities for the right reasons — acquiring brands, technology and customers, or to gain complementary competencies — they should be able to exploit the synergies. So far we haven't seen too much of it. But perhaps we will when the global economy finally recovers.


The writer is Resident Editor, Mumbai, 'The Financial Express'








Aung San Suu Kyi's release may not prove to be a decisive moment in Myanmar's march to freedom. But it nevertheless is a poignant reminder of the enduring power of idealism. Stalin's question, "How many divisions has the Pope got?" often reverberates with those who command mighty armies, and hard-headed pragmatists. It would be foolish to underestimate the power of those who do have the divisions behind them. These regimes can snuff out revolt; they can govern by inducing fear, and many have long endured.But the enduring power of individuals to reverse the question — "How secure can those many divisions make you?" — is equally striking. Nothing reveals the potential brittleness of authoritarian regimes more than the power of particular individuals who come to symbolise challenges to a regime. The measure of their success is not always that they can induce change. The measure of their success is simply their being. Their very presence is always a potential incitement to speak truth to power. It questions the legitimacy of those who have nothing but the power of divisions behind them. And the way these regimes treat them constantly exposes their potential brittleness and fear. They exile them, they imprison them, and they often fear even killing them. It is as if these individual talk back by saying, "Why do you fear me, if I don't have the divisions behind me?"There is a long line of individuals who acquired, in different ways, this status from Gandhi to Mandela. Even in our times there are rather curious illustrations of the power of those without divisions. Mighty China still thinks of the Dalai Lama as a far more potent threat that several armies. The Dalai Lama may not achieve his goals, but his ability to make power look fragile is not a mean achievement. Think also of the reverse. So many worthy causes that have floundered because they have not generated that individual who becomes the locus of moral authority, whose presence personifies the value they are defending. The Palestinian cause has always suffered by the inability of the movement to generate such a sympathetic figure. And several states have struggled because they have not generated a figure who could be a locus of national reconciliation; just think of Pakistan or Nepal. What makes such figures important is a complicated matter. It involves everything from charisma, articulacy, an aura of martyrdom, and an ability to create a mythology. Sometimes circumstances and geopolitics provide other powers with a reason to invest in these individuals. Often these individuals are far from perfect. Their very strength can be a source of weakness; idealism can question the claims of power, but it is not itself a substitute for political judgment. And there is often much to quibble about their sense of political judgment. But these individuals are often powerful in a foundational sense: they hold out the fleeting hope that we can indeed make our own history and dislodge the binding constraints of power.Suu Kyi has, undoubtedly, become one such figure. The extraordinary personal sympathy she generates, the depth of her engagement with two traditions of political thought (Myanmarese and Western) which she has melded in a distinctive Myanmarese vision of democracy, made her a central figure of our times. Her role in Myanmarese politics is complicated, and how the script unfolds from now remains to be seen. But she has articulately kept alive one simple thought: that freedom of expression is the core of democracy; and it is this thought she returned to in her first speech after her release. Her most quoted line squarely puts her in the tradition of those who know that the only way to feel empowered is to speak truth to power: "It is not power that corrupts but fear. Fear of losing power corrupts those who wield it and fear of the scourge of power corrupts those who are subject to it." In her writings there is not a trace of demagoguery or populism; democracy is in the service of freedom, not the other way round.India's role in Myanmar will have to await full analysis. But there is something grating about the self-congratulation we have exuded on our so-called pragmatism on Myanmar, often to the point where our support for Suu Kyi was unconscionably tepid. Dealing with dictators is no easy matter. But countries are, in the final analysis, judged by whether they are on the side of the future or whether they help perpetuate a dark past. On this criterion, we should admit, India often did not measure up. When Obama lectured us on Myanmar we were offended. The US is by no means an exemplary power when it comes to dealing with dictators. We were right to point that out. Obama's references were partly attempts to throw a bone to those in the US sceptical of India, particularly in light of the fact that our voting record in the UN is at more than 80 per cent variance with the US. But there is a disquieting way in which our newfound realist macho mentality has made us tone deaf to the deepest compliments offered to us. The real compliment Obama offered us was not backing for a UNSC seat. It was a reminder about our own history, through the figure Gandhi, to whom he repeatedly turned. What he seemed to be saying, with utter sincerity, was: you have already powerfully shaped history, including my own personal history. You shaped that history without the equivalent "divisions". He wasn't so much lecturing, as wistfully projecting idealism onto us. The source of our power is the fact that we are one of the few powers onto which the world still wants to project a sense of idealism. Of course we need our "divisions". But we can still acknowledge that being held to higher moral standards is the big compliment; not just the seat at the High Table. There is prudence in taking on board the sordid realities of power politics, as we ordinarily understand it. But a political culture where idealism is not even a distant gleam in the eye has also divested itself of any real understanding of deeper forms of power. Those moments of idealism come rarely, and in a cynical age are personified even more rarely. But in the heroic battles for democracy, figures like Suu Kyi, for all their limitations, still remind us that freedom and the power of example are a force that can still corrode those with armies behind them.


The writer is president, Centre for Policy Research, Delhi






At a time when the Left has made common ground with the BJP in demanding a JPC probe into the 2G spectrum scandal inside Parliament, the CPI's weekly has taken potshots at the main opposition reminding it that it has its own share of corruption cases . The main editorial in New Age notes that although the BJP is making lots of noise about the Adarsh Society scam, "one does not know what its approach will be when it is confirmed that among the beneficiaries is its own national president, Nitin Gadkari."

Similarly, the Commonwealth Games scam's beneficiaries, it says, are also not confined to the ruling party. "Sudhanshu Mittal, a confidant of the late Pramod Mahajan is already under probe for his role in the huge loot of CWG funds. Mittal cannot be disowned by the BJP as he is the only person with the knowledge of all the black money that Mahajan invested during the NDA regime for the BJP," it alleges.


The editorial also refers to the reported corruption cases in BJP-ruled Karnataka, mainly revolving around illegal mining. "The BJP wants discussion only on selected cases. It is not ready for discussion on all aspects and all scams and scandals that have been revealed during the past few months," it says.


... and liberalisation is to blame 


The CPI(ML) is of the view that the resignations of A. Raja and Ashok Chavan were a desperate attempt by the Congress to save face as it was inundated by a series of scams involving top UPA ministers as well as its leaders. The lead editorial in ML Update says the resignations are a clear admission of guilt, but such resignations must not divert from or dilute the struggle to ensure thorough probes and speedy punishment in all sorts of scams. "Those who are bleeding the country to favour a handful of rich corporations must be exposed and brought to book," it says.


The CPI(ML) takes the view that corruption and crony capitalism are endemic in times of liberalisation — and not only the Congress and its allies ruling at the Centre, but the BJP too cannot escape the taint. "The mining mafia Bellary brothers in BJP-ruled Karnataka are part of the same phenomenon, and the BJP central leadership too has time and again showed its allegiance to the power of such corrupt corporates," it says.


No students in tribunals


An editorial in the CPM's People's Democracy puts forth the party's position on the proposed Educational Tribunals Bill in no uncertain terms. It says the bill seeks to accommodate retiring or retired judges, vice-chancellors and secretary-level IAS officers up to the age of 70, contravening Supreme Court judgments about constituting them with a majority of members having a judicial background.

Besides, the national educational tribunal will have administrative control over all the state-level tribunals and will oversee their functioning. "This amounts to centralising the whole mechanism," the article says.

"The bill does not spell out the kinds of problems and disputes facing the students, on which either the national or a state-level tribunal would adjudicate. The word student appears only on the first page, after the title of the bill and in the first paragraph of the statement of objects and reasons... There is no section in the bill in which the disputes between students and their institutions are mentioned. This being the case, a tribunal might well refuse to entertain such disputes," the article argues, adding that an aggrieved student cannot go either to a tribunal or to a court of law and the "bill is thus most authoritarian as far as students are concerned and does grave injustice to them."Compiled by Manoj C.G.








In the Rajya Sabha on that distant date, Sudhir Ghosh had also alleged that Nehru had asked Kennedy for, among other things, a US aircraft-carrier to be stationed in the Bay of Bengal. But of this there is absolutely no mention in either of his two letters to JFK. What is eminently noteworthy, however, is that despite his exaggerated estimate of the Chinese objectives, Nehru was not at all oblivious of the kind of pressures that would be brought to bear on the US president against extending "comprehensive" military aid to India.


So he wrote: "The Chinese threat as it has developed involves not merely the survival of India, but the survival of free and independent Governments in the whole of this sub-Continent or in Asia. The domestic quarrels regarding small areas or territorial borders between the countries in this sub-Continent or in Asia have no relevance whatever in the context of the developing Chinese invasion. I would emphasise particularly that all the assistance or equipment given to us to meet our dire need will be used entirely for resistance against the Chinese. I have made this clear in a letter I sent to President Ayub Khan of Pakistan. I am asking our Ambassador to give you a copy of this letter.


"We are confident that your great country will in this hour of our trial help us in our fight for survival and for the survival of freedom and independence in this sub-Continent and rest of Asia. We on our part are determined to spare no effort until the threat posed by Chinese expansionist and aggressive militarism to freedom and independence is completely eliminated".


It is perhaps needless to add that on November 20 the Chinese declared a unilateral ceasefire and phased withdrawal. Consequently, the urgency behind Nehru's correspondence with Kennedy disappeared. But, ironically, the reference to irrelevance of "domestic disputes over small areas or territorial borders between the countries in the sub-Continent" did not achieve the desired result. On the contrary, the US and Britain, represented by Averell Harriman and Duncan Sandys respectively (the latter more than the former), pressured India relentlessly to settle the Kashmir issue with Pakistan. The protracted but pointless six rounds of talks between Swaran Singh and Zulfikar Ali Bhutto, adequately discussed in this column already, followed. A trickle of American military assistance did slowly flow into India but it did not amount to much and was, in any case, terminated during the 1965 India-Pakistan War.


There is no point quoting those portions of Nehru's first letter that were either repeated or updated in the second. However, something of significance it underscores merits attention. Saying that a month had elapsed since China's "massive attack on India" Nehru added he thought he should inform Kennedy of further developments since "my last letter of October 29."


He then went on to say: "There was a deceptive lull after the first Chinese offensive during which the Chinese mounted a serious propaganda offensive in the name three-point proposals, which shorn of their wrappings, actually constituted a demand for surrender on their terms. The Chinese tried, despite our rejection of these proposals, to get various Afro-Asian countries to intercede with various offers of mediation. After my clear and categorical statement in Parliament on 14 November rejecting the three-point proposal of Chou en-Lai, the Chinese who had made full preparations to put further military pressure on us, re-started their military offensive... Events have moved very fast and we are facing a grim situation in our struggle and in defending all that India stands for against an unscrupulous and powerful aggressor."


Incidentally, after the ceasefire, President Gamal Abdul Nasser of Egypt, Sri Lankan Prime Minister Sirimavo Bandarnaike, Ghana's leader Kwame Nkrumah and some others met and formulated some principles on the basis of which, they said, India and China could resume negotiations for settling the border issue. These came to be known as the Colombo Proposals because the non-aligned leaders had met in the Sri Lankan capital. India accepted the proposals; China rejected them out of hand. Thereafter, New Delhi declared that border talks with China could take place only on the basis of the Colombo Proposals, and this remained Indian policy until New Year's Day, 1968, when Indira Gandhi, as prime minister, announced that she was prepared to negotiate with the Chinese without any precondition. It took China more than two years to respond. On May Day 1970, Mao Zedong made it a point to smile at the then Indian Charge d' Affairs in Beijing, Brajesh Mishra. China's Chairman also said that there was no reason why India and China, both great countries, could not be friends. Nothing came of this, however, because soon enough the Bangladesh crisis, leading to the 1971 war, erupted. China supported the Yahya Khan regime in Pakistan to the hilt. Chou even said that India had picked up a rock it would "drop on its own feet." It took another 10 years before border talks between the two countries could begin. They are still dragging on.


Back to the two letters, Nehru's official biographer, S. Gopal, never admitted to having seen them. But he confidently asserted that the letters were drafted by the foreign secretary of the day, M. J. Desai. If true, this is rather strange. For Nehru always wrote his letters himself — sometimes drafting them for his subordinates to sign.


B. K. Nehru, a cousin of the prime minister and an outstanding civil servant who later became the closest thing we had to an elder statesman, was at that time ambassador to the US. He never made a secret of the fact that on receiving and reading the second letter, his impulse was to not deliver it. But realising that he was a civil servant and it was his bounden duty to obey his prime minister, he immediately headed for the White House. He never discussed the contents of the two letters with anyone but did tell me that he locked them up in the safe that only the ambassador could open. He knew not what his successor had done with the letters he must have seen.


The writer is a Delhi-based political commentator








Nothing could be a better present for an organisation celebrating its 150th year of existence than the scalp of a top government minister. Nothing, not even the CBI FIR, managed to shake telecom minister A Raja until the CAG announced it was looking at a Rs 1.76 lakh crore problem a few days ago. Interestingly, even those who have run down the CAG from time to time, as a variant of the proverbial drain inspector's report, have put their faith in various CAG reports. Even the private sector has, from time to time, put its faith in the CAG—so when the Anil Ambani group was fighting Mukesh Ambani's RIL, it asked for the CAG to audit the spending on the K-G Basin gas fields. Indeed, it would be fair to say that most major scandals, whether in the distortions introduced in the VDIS amnesty scheme that allowed people to get away with paying 5-10% tax rates on their black money or even in the Delhi Vidyut Board privatisation, were those unearthed by the CAG. As time goes by, the role of the CAG is certain to increase dramatically. Since a lot of the planned $1 trillion infra-spend in the next Plan period will take place through the PPP route, to cite one reason, the CAG will have a role in auditing this—there is already talk of getting the CAG to audit reports of various telcos since their licence fee payments depend upon the revenues they show.


This is where we need to be both careful as well as make the necessary changes. A situation where all privately audited results are believed to be fake, and so need a CAG audit, can have disastrous consequences. Apart from anything else, it puts the kind of burden on the CAG that no organisation can possibly handle. To rise to the challenge, the CAG needs to dramatically upgrade its skill set, and CAG head


Vinod Rai has been talking of precisely that. To prepare for the K-G Basin audit, his officers were seconded to various oil firms abroad and also have 24x7 training programmes. It would be naïve, however, to believe you can have a world-class CAG without competitive salary structures. Equally, the government needs to take the CAG seriously, but despite the Raja resignation, there is little happening to show this is the case—who lost his job after the CAG reports on VDIS or DVB to cite just two examples? Also, the CAG Act needs to be changed to allow it to audit PPPs where the government stake is less than 51%. There is also the issue raised by Raja's ministry, that the CAG is not authorised to look into anything but its books of accounts. All these issues need to be fixed if the CAG is to celebrate its 200th anniversary in any kind of glory.







Apart from what it does for the owners, it is pretty well established that the availability of decent housing facilities has a big impact on labour productivity and business competitiveness. What's interesting, as a recent report on housing by the NSSO brings out, are the impressive strides that India has made in this area—the share of pucca houses, the proportion that are owned (as opposed to rented), the proportion with electricity and latrine facilities has risen to respectable levels. From around half in 1993, the share of houses with electricity is up to three-fourths in 2008-09; the share of houses with access to tap water has gone up from less than a third to 43%; and the share of houses without latrine facilities has gone down from almost three-fourths to less than half in the same period.


What is more impressive is the sharp reduction in the disparities in the housing scenarios in urban and rural sectors. Numbers for 1993 and 2008-09 show that though the urban sector showed greater buoyancy in some indicators, like the increase in share of self-owned houses, it was the rural sector that registered the biggest gains in increasing the share of pucca houses, electrification, availability of tap water and latrine facilities, mainly due to the substantial progress in urban areas in the past. While the share of pucca houses in the rural sector went up by 23.1 percentage points to 55.4%, their share in the urban sector went up by only 18 percentage points (to 91.7%). More impressive has been the gain on the electricity front, with the share of electrified houses in the rural sector going up by 28.7 percentage points to 66%, whereas the increase in urban share was up only by 14 percentage points (to 96.1%). The increase in access to tap water in the rural sector was double that of the urban sector, with the share rising by 11.2 percentage points in the former as compared to a 3.9 percentage points increase in the latter.


In the case of latrine facilities, both rural and urban areas saw a 20 percentage point hike. Higher GDP growth and greater focus on the social sector in recent years seem to finally be bringing up some positive trends in closing the urban-rural divide, at least on the housing front.









Don't mislabel 2010 as the year of maha corruption cases. For Indian democracy, it's the first year that saw each corruption case taking down at least one public figure from the office where the scam was hatched. This is a record of which we can justifiably be proud. India's reputation as a rent-seeking polity will take some more time to be erased, but we seem to have arrived at a way to handle corruption that was earlier missing from our arsenal.


Just look at the list. The Commonwealth Games scam has nailed Suresh Kalmadi, the IPL scam took down minister of state for external affairs Shashi Tharoor, the Adarsh society scam has forced the resignation of Maharashtra CM Ashok Chavan and now the 2G telecom scam has accounted for telecom minister A Raja. This is a strong lineup and gives us enough reason to expect that, at the beginning of a new decade, our new-found impatience with corruption will get more powerful and better-directed.


It is even more instructive if one compares this record with the way corruption cases have shaped up since 1991. Except the Sukhram case, again in telecom, few corruption charges have been pinned to perpetrators if they were, or are, public figures. The fodder scam for which Lalu Prasad


Yadav spent time in jail was one of the exceptions. Writing in The Indian Express this week, Seema Chisti has made the pertinent point that in some of the rare cases that created more of an uproar, the person has sometimes just lost the elections. The loss has served as reason enough to exorcise them of the 'sin'.


The cases that made progress, that too desultorily, are instead those related to stock market episodes. Here too, it took the agencies over a decade to establish the charges of fraud against Harshad Mehta, a slightly shorter time-frame in the Ketan Parekh case, while the Satyam case is just plodding on. By any standards, the movement from the establishment of the prima facie charge to the resignation of a public figure associated with the case has been amazingly fast, in 2010.


What happened? As the Indian growth story has become stronger, every year a few million (repeat million) Indians are associating themselves with it. Their tools are hard work and skills but not sleaze or pushing contacts. Simultaneously, the pace of urbanisation has acquired critical mass. Because of these two developments, the number of upwardly committed Indians living in urban spaces has shot up exponentially. They are now a significant determinant of the national political mood and a huge constituency that no party will annoy.


A related development has been the spread of media that has helped to shape the debate in every urban lane. Just watch how the pieces came together in the Commonwealth Games episode. For three year and more, some of these Indians, viz the 40 million of Delhiites faced all sorts of hassles to make the games successful. When the reports of massive purloining of money and mismanagement by the organising committee broke out, they could all feel embarrassment and anger instinctively.


Ten years ago, telling the story of a games gone wrong to a rural audience would have seemed far removed from their daily concerns. But not now. The same has been the contour of the Adarsh society scam. In a city where procuring a reasonably-sized flat is a tall order for most inhabitants, this report of corruption touched a raw nerve. Moreover, as the housing shortage has spread to all cities and even the small towns, the collective sense of indignation has been fantastic. But having revelled in the public's short fuse on corruption, the more difficult part of the scams will now surface. That is, how and which agencies will track the cases from here.


As I had written recently, India has no centralised agency that can track all aspects of corruption. The CBI, in its emasculated form, is just not up to the task. Moreover, it was set up to track corruption cases in government with personnel enough to track only small-time crime. The sophistication of cases like Satyam or the intricacies of the allotment of the 2G telecom are way beyond its ability. In fact, the primary reason the CBI exists is to file cases, as it is the only one among investigative agencies with the powers to file a police case. This means after a case is filed, it depends on agencies like the Serious Fraud Investigation Office to supply it with their case diary. The CAG report, for instance, cannot be used as a basis to prosecute any company or agency.


The other aspect of corruption is that there is no government agency that knows how to deal with corruption in the private sector. As a result, the Indian government has not signed the UN Convention on Corruption, leaving us the only major democracy not to have done so. Keeping India company are Sudan, Saudi Arabia and some of the former Soviet Union republics. Having raised the expectations of the Indian public on the one thing that makes them wince, the government can hardly let the current stasis continue.










Demands for the 100-day job under NREGS to pay minimum wages have revived with the National Advisory Council's (NAC) letter to the Prime Minister supporting earlier letters from the chief ministers of Andhra Pradesh and Rajasthan. Accepting this demand would be a mistake because it would not only distort labour markets but also blunt the march to higher productivity of our people and economy. Wages must reflect productivity and NREGS payments are not wages but cash transfers to the poor because they have an opening balance that is difficult to escape. If the objective of NREGS is sustaining poverty reduction, a more effective tweak to the scheme will be converting it into a 100-day apprenticeship programme that would create a corridor for skills, higher productivity and higher wages.


Economists will debate for years whether NREGS has been one of the causes of the dangerous and painful food inflation over the last few years.


In my view, the only desirable—and largely unintended—consequence of NREGS has been to catalyse a long overdue increase in the machinery and capital investments in agriculture, which are raising productivity. When farmers talk about the shortage of agricultural labour they mean the shortage of labour at the price they had got used to paying.


The NREGS rate does to national agricultural markets what the LIBOR rate does in global dollar borrowing markets; it sets a floor. But just as every loan is not made at LIBOR rates but is priced off it, NREGS payments must not equal minimum wages. More than 19 states have now increased minimum wages to levels over NREGS and this is not a problem but an important signal of the returns to skills and employability. Equating NREGS payments—I refuse to call them wages—with minimum wages will only trigger another round of minimum wages increases that will not reflect productivity. Unlike China where wages are horribly sticky and mostly administered, India's wages are quite efficient at pricing skills. Efficient pricing of skills is key to accelerating the privatisation of skills by influencing personal career choices and allowing the emergence of third party financing for personal skill repair.


NAC is upset that the NREGS violates the Minimum Wages Act. But everybody knows that NREGS violates 37 labour laws, including the Provident Fund Act, ESI Act, Industrial Disputes Act and Contract Labour Act. I have never received a reply to my repeated letters to the government asking for the rationale of the temporary job apartheid under which a non-fiscal, minimum wage and social security paying 100-day job offered by the private sector is viewed as a disease to be eradicated, while the inefficient, non-market, non-real job based NREGS is considered the labour market innovation equivalent of cell phones.


The Central Employees Guarantee council working group on wages, headed by Jean Drèze, said that state wages should be paid indexed to the CPI. Debates about minimum wage periodically flare up but we can learn from other countries. The US is a good case study: consider the May 2007 law that raised the minimum wage in three stages to $7.25 an hour from $5.15. Rarely has a law hurt the more vulnerable people more quickly. A higher minimum wage has the biggest impact on those with the least experience or the fewest skills. Usually that means those looking for entry level jobs, especially teenagers. To raise the cost of unskilled labour precisely when they need a portal to employment is an act of almost wilful economic stupidity. In many cases the wages have since become zero.


But NREGS is here to stay and the good is not the enemy of the great. So we must tweak the current structure of NREGS payments to be apprenticeship stipends for 100 days of on-the-job training. These apprenticeships could be complemented or combined with 100 days of classroom or satellite training to produce skilled manpower that earns wages which reflect productivity. If the NAC really wants to innovate, it must propose a solution that amends the Apprentice Act of 1961 and transfers some NREGS money to the starving but effective modular employment skills programme of the ministry of labour. A 100-day apprenticeship under NREGS that combined learning-while-earning and learning-by-doing would surely move the needle on the horrible skill deficit that keeps our people out of jobs or in working poverty. The current campaign to equate minimum wages with NREGS payments almost legislates that the bridge to productivity becomes the destination. In the name of our poor who need a chance and not charity, it must be resisted.


—The author is chairman, Teamlease Services









Cairn you help us?


Oil major Cairn India seems to be running into all manner of obstacles while trying to sell to the Vedanta Group. While the petroleum ministry initially suggested that ONGC had the right of first refusal, this problem got resolved when ONGC didn't make a bid. ONGC then began talking of how Cairn had overspent on exploration and how it needed to audit the figures, never mind that the directorate general of hydrocarbons hadn't raised the issue or that ONGC had never spoken of this earlier. The buzz is now that oil ministry officials are approaching private oil firms in India asking them to put in a bid as well. It's not clear how the episode will pan out, but the way the government is behaving is sure to send out very bad signals to global investors.


No Singur there?


West Bengal chief minister Buddhadeb Bhattacharjee hasn't got over the land acquisition row at Nandigram and Singur that saw Left Front fortunes dwindle in the May Lok Sabha elections last year. When Bhattacharjee met high commissioner of South Africa in India Rev Harris M Majeke some time ago, he couldn't resist asking about the land acquisition process in the country. Bhattacharjee asked him whether there had been any trouble in the country due to land acquisition for industry. No, was the prompt answer. South Africa has large tracts of land lying idle with hardly a sizeable population ready to take up farming. "We have almost 90 lakh hectares lying idle," said Majeke. While Bhattacharjee could not find any solution from the land of Mandela, he instantly offered help to develop agriculture in the country. Bengal is the largest rice producer in the country, though productivity is falling.





Transparency International (TI), without fail every year, holds a distressing mirror to graft in India. As compared to Denmark's first rank and an integrity score of 9.3 and the US's 22nd rank and integrity score of 7.1, the latest report ranks India a lowly 87th with an integrity score of 3.3. Worse, India has slipped three spots since last year. This is thanks, it appears, to the Commonwealth Games stain. Since then, Adarsh has happened. Ongoing exposés of Karnataka's ministerial land-grab and A Raja's telecom tale have gathered steam. If companies paid Rs 1,651 crore for what were always dodgy licences, it suggests they were confident they wouldn't be caught out. But perhaps if Mr PS Bawa, chairman of TI's India chapter, were to meet Mr Ratan Tata over lunch, his organisation may be persuaded to exchange its glumness with rosiness.


If Mr Tata has survived without paying bribes, as he seemed to suggest in Dehradun, that's a big commentary on the state of India. Founded in 1868, the group thrived through pre-liberalisation autarky and yet made a healthy transition into the post-1991 economy. Today, it boasts a record 27 listed companies. It also boasts India's largest integrated tea company, watch manufacturer, software exporter, private sector steel producer, 5-star chain of luxury hotels, manufacturer of soda ash and private sector power utility. The group accounts for around 5.9% of the total market capitalisation of BSE and enjoys the trust of over 3.5 million investors. All this without paying bribes! Did Google pick its "Don't be evil" motto from Tata? And incidentally, that bit about what helps him sleep, this is not the first time Mr Tata has brought it up. Back in 2007, for instance, the Economist reported being told that, "I want to be able to go to bed at night and say that I haven't hurt anybody."


The magazine was persuaded that the man doesn't seem motivated by money. Your response, Mr Bawa?








Aung San Suu Kyi is finally free. Around the world, there is relief that Myanmar's repressive military junta has released this courageous woman whose sacrifices in pursuit of her mission to bring democracy to her country have few parallels. She is a true hero of our times, and her freedom has brought with it hopes that the junta is relaxing its hold on Myanmar and that a transition to democracy is round the corner. It is tempting to think this way. The world is in a rush to do business with Myanmar but as long as Ms Suu Kyi was imprisoned, it could not do so with a clean conscience. Now that she is free, countries can engage with Myanmar without feeling guilty about it. But as we celebrate Ms Suu Kyi's freedom, it must be remembered that this is not the first time she has been set free. The last time was in May 2002. In exactly a year, feeling threatened by the crowds she was drawing wherever she went, the junta pushed her back into house arrest. Her release this time, orchestrated to follow a sham election, is meant to give the generals a softer look after their grip-tightening pseudo-democratic exercise. Going by the rapturous response of the masses, the democracy icon remains a powerful political figure in her country. But there is no indication from the junta that it has changed its stripes.


It was significant that soon after her release the Nobel laureate tempered her remarks on the freedom of speech with a call for national reconciliation through talks with the junta, and spoke about achieving democracy in the "right way." Was she dropping a hint that international sanctions against Myanmar might have to be relaxed or withdrawn when she said: "This is a time for Burma when we need help. We need everybody to help in this venture: western nations, eastern nations, all nations"? It is difficult to see Ms Suu Kyi making a deal with the generals or accepting their version of democracy. The path ahead of her is extremely difficult. How much political space she will be able to carve out in the new situation, what are the limits to the junta's tolerance of such political activity, how the rest of a fragmented opposition will respond to her pre-eminence are all imponderables. The limits of international influence in Myanmar have been exposed all these years in its signal failure to prod the junta into embracing democracy. Still, the outside world must work to ensure that, aside from Ms Suu Kyi remaining free and able to engage in political activity, Myanmar's more than 2,000 political prisoners are released. India must play a role in this process, using its influence with the generals. Not because the President of the United States wants this, but because it is the only right thing to do.







Twenty years is a good enough time to assess how countries of the world, irrespective of the economic or political system they follow, have performed in promoting human development. Successive Human Development Reports (HDR), since 1990, have mainstreamed health and education as critical indicators of human progress and contributed to international policy structures. For instance, the Millennium Development Goals, aimed at using international financial resources to reduce global poverty, can be traced to the HDR-1991 on financing development. Significantly, this year's HDR has made long-term innovations in measuring development. First, it reconfigures its indicators on literacy and income. Replacing 'gross enrolment' and 'adult literacy rates' with 'expected years of schooling' and 'mean years of schooling' makes for a deeper understanding of this important socioeconomic attribute, particularly as literacy rates, which are rising around the world, could gloss over structural weaknesses. Replacing 'Gross Domestic Product' with 'Gross National Income', which includes international income flows, would bring in a fresh perspective on an economy's standing, particularly in the current globalising context of a country's poverty reduction programmes. Secondly, HDR-2010 introduces three indices — the Multidimensional Poverty Index, the Gender Inequality Index and the Inequality-adjusted Human Development Index — aimed at gaining a deeper appreciation of a country's development path.


The 2010 Report, The Real Wealth of Nations: Pathways to Human Development, comes as a timely reality check on India's global standing. It shows that, despite recording a phenomenal economic growth recently, India continues to remain in the bottom-50 on human development — it is placed at 119 out of 169. The report points to critical social failures. Its new indicators on education tell the story of how rising literacy rates are no cause for comfort. The 'mean years of schooling' is only 4.4, compared to the global figure of 7.4; and the 'expected years of schooling' of 10.3 is short of the global average of 12.3. These are particularly important pointers at a time when India prepares to give its children the right to free and compulsory education. At a theoretical level, it is noteworthy that the report finds a "weak long-term association" between income growth and changes in education and health. This finding, read along with the failure of 'trickle down' theories to deliver, only re-emphasises the need to rethink economic growth strategies, particularly in the developing world.










Now that the terms of inquiry into the conduct of the Commonwealth Games have been extended, let us hope that the process of probe will be more open than was decision-making for the CWG. Let us also hope that the review will cover the opening and closing ceremonies as well, both in terms of their content and the decisions and choices involved in the actual design of these major cultural events. Both ceremonies received wide acclaim but left many citizens like me a bit terrified and confused. There were uplifting moments, but there was something deeply upsetting too. I felt as if the core of my identity as an Indian was going through an unexpected surgery. I could not stop feeling that an India I knew was being declared dead. Who had the taken the decision to do so, I wonder. The Games are over and the propaganda of national prestige cannot be used anymore to silence dissenting voices. Let us revisit the experience of witnessing the dramatic changes this historic event introduced in the ethos of our country and its capital.


It was early in the morning and the year was 2008. During my daily walk, I noticed that someone had dug a trench around the tree I used to pass each day. Many roots were exposed. I thought perhaps the botany department of my university had decided to cure this tree of some root infection. The next day I saw similar trenches around more trees, and within that week I noticed that the root systems had been bundled up in white plastic. Evidently, the trees were about to be relocated. One by one, over the next few weeks, hundreds of beautiful mature trees thus treated disappeared, leaving open holes in the ground. Pre-dawn trucks carried them away to an unknown destination. It was a kind of emergency. No one knew what was happening and how many trees would eventually go. It was rumoured that the contractor shifting these trees earned Rs.10,000 per tree. There was no way of verifying this or anything else that happened over the next three years on the campus of Delhi University and in other parts of the city. Let the inquiry committee find out how many trees survived the shifting and where they now are. I would certainly like to visit them if they are alive. Even if they are found dead, which is likely, it would be a relief to have the mystery surrounding their relocation unravelled.


How Delhi's public learnt to endure the pervasive but unexplained disruption of their daily life and the wilful destruction of the environment cannot be easily assessed or documented. A sudden loss of common civic rights took place. It was sometimes described as a kind of 'sacrifice,' but the idea of sacrifice includes acceptance of a cause and attribution of greatness to it. Not for a day did the cause look great. When the display part of the ordeal was over, some people expressed pride and pleasure. For them as well as for all the others, it is important to remember that the consequences of the ordeal will stay for years and debates will be necessary to determine what exactly the Games meant for the nation. This is why it is important to recall what preceded the event and happened during it. I remember the day the Platinum Jubilee park on the campus was closed and decimated so that it could be converted into a parking lot. There was no discussion, no mention of the cost it had incurred only a few years ago. It was clear that the people who had taken over were far more powerful than the ordinary residents of the area and students. When the 2010 session began, the students were blocked from their own hostels. Several buildings were demolished. Telephone cables were repeatedly slashed, electricity and water supply was disrupted, and traffic turned into chaos. On the sidewalks, the Games took the form of a festival for contractors dealing in tiles. New tiles were installed in millions and in every conceivable colour and design. Old tiles, even the ones laid out a few months ago, were dug out. Towards the end, the tile-diggers went berserk and replaced the ones they had placed a few weeks ago. Rickshawpullers and street vendors were treated like pests — to be hit any hour of the day when the authorities wanted the road to look world class. Construction workers were made to work day and night; many who got sick, injured or died were made to disappear.


Civic and social costs apart, the financial cost of the Games will remain difficult to judge. Towards the final months, the media gave a glimpse of the scale of corruption involved in the procurement of utilities, but even if we leave those stories aside, the legitimate expenditure raises fundamental questions about the nation's priorities and values. Estimates vary but the average figure is astounding. It exceeds the total annual contribution of the Centre to the Sarva Shiksha Abhiyan (SSA). How will the government convince anyone that India's ability to turn its children's right to education into a reality is hampered by a budget constraint? Why would the tribal people of Jharkhand and Chhattisgarh, who are fighting with their backs against the wall, believe that their country lacks the resources to rehabilitate them with dignity when mining companies require them to be thrown off their forest land? The profligacy exhibited in the Games signifies the state's seal of approval of the lifestyle of India's new maharajas. There is no point now fantasising that we can persuade Mukesh Ambani to gift his 27-storey house and its hanging gardens to Mumbai's children as a vertical amusement park. What he has spent out of his own earnings is merely half the SSA's annual central outlay.


The callous financial behaviour was matched by the gross choices made in the representation of culture. A kay item of the closing ceremony was the electronic representation of a giant size woman dancing in the nude. The item was reputedly imported from Germany, along with a team of laser technicians. It was truly a crowning moment — in the history of a society being engineered by determined hands. Exactly whose hands they are is hard to say, and that is why this is a memoir of feeling disoriented and shaken. Perhaps the inquiry committee will find out who approved that laser show and the Bollywood dance which followed. Let it also ascertain the justification for the decision to ask the young women who carried the medals for distribution to victorious athletes to dress themselves in a bridal lehenga. If the inquiry process throws even modest light on such choices, it will help to make sense of the leap we have taken in the dark, deluded in the name of the nation and its glory.


In the opening ceremony, there were items displaying the Buddha and Gandhiji. We do need to construct, with memory and imagination, what they would have thought of the indignity meted out to womanhood in the laser show of the closing ceremony. Those who choreographed the closing ceremony do not distinguish between women's bodies and common utilities. They apparently attribute sovereignty to the male right to consume both as the basic point of India's current economic growth. As philosopher and historian Lata Mani has pointed out, we are witnessing the rise of a new kind of body politic which is hostile to the Constitution's vision of a nation which guarantees dignity to all — including women and children, not just men. If the state is the primary instrument of realising that vision, the Games have certainly damaged the state's credibility. It will take a long and patient effort to restore public confidence in the state's decisions to the pre-Games level. It was not particularly high, cynics might say, but even they would agree that the Games have injured civic faith. Whatever can be done to heal that injury should be done.









President Barack Obama's 10-day tour through Asia is being deemed a disappointment in some Washington circles after the President failed to secure a free trade with South Korea, or forge a consensus on issues of currency manipulation and trade imbalances. However, the President's underwhelming performance in East Asia risks overshadowing his more commendable performance in South Asia, where President Obama announced that America now supports a permanent seat for India at the United Nations Security Council. The policy change was warmly received in New Delhi, where politicians have been lobbying the U.S. for such an endorsement for years (not even the Indophile Bush administration was willing to offer one). And while there is little likelihood that India's Security Council aspirations will be fulfilled anytime soon, President Obama's announcement at least temporarily silenced critics who had begun to question the President's commitment to the U.S.-India partnership.


UNSC seat


The announcement is not without controversy. Pakistan, as expected, has condemned the decision. The Chinese are, at best, unenthusiastic. The logistical and diplomatic hurdles are the most imposing, however. The notion of expanding the Security Council at all is deeply contentious. Passing the necessary U.N. Charter Amendment, which requires two-thirds support in the General Assembly, will be a daunting challenge. Any of the five permanent veto-wielding members, with little incentive to dilute their privileged status, can nix a reform proposal with one vote. While the U.S. has also supported a permanent seat for Japan, there is no consensus in Washington or New York on who else deserves a seat at the U.N.'s pre-eminent decision-making body. Basic questions such as how many new seats will be made available and whether or not new members will receive veto power are still being pondered.


Moreover, China could well veto an Indian bid if it ever came to a vote (Russia, Britain, and France, the other three veto-wielding permanent members of the Security Council, have endorsed an Indian seat). India and China enjoy cordial diplomatic ties but relations on the ground are characterised by deep mistrust. Disputes over Kashmir, contested border areas, cyber-espionage, and China's growing presence in the Indian Ocean have bubbled to the surface in the past two years.


Cold War politics


There are opponents in Washington as well, despite the fact that congressional leaders on both sides of the aisle swiftly backed the President's announcement. Sceptics point to a 60-year record of U.S.-Indian disagreements on contentious global issues. Indeed, the respective voting records of Washington and New Delhi at the U.N. General Assembly and the Security Council (where India periodically appears as a rotating member) do not compare favourably.


However, many of these disagreements were formed in the morass of Cold War politics. In most cases, gaps in the two countries' positions have narrowed, although they maintain independent priorities on issues such as global trade, non-proliferation, Iran, and Myanmar. Yet, without veto power, the U.S. has little to fear from an Indian seat on the Council. Even if they do disagree frequently, it is exceedingly rare that Security Council votes are decided by split decision. (The closest vote in the past five years — 10 approved, five abstained — came in 2007 to establish a tribunal over the assassination of former Prime Minister Rafiq Hariri in Lebanon.) Thus, the U.S. has little to lose from endorsing a Security Council seat for India, and much political capital to gain in New Delhi.


The President sweetened the deal by announcing that two of India's massive State-owned military and research firms, the Indian Space and Research Organisation (ISRO) and the Defence Research and Development Organisation (DRDO), would be removed from a U.S. sanctions list, opening the door for trade in dual-use and strategically sensitive materials. Additionally, Mr. Obama, who far exceeded the modest expectations set for his trip, sealed roughly $10 billion in military deals negotiated in advance, and announced America's intention to support India's membership in four global non-proliferation clubs: the Nuclear Suppliers Group, Australia Group, Missile Technology Control Regime and Wassenaar Arrangement. Finally, President Obama made the symbolically important move of inviting India "to not only 'look East,' [but] to 'engage East'." The statement was compensation to Indians who were perturbed by the Obama invitation last year to China to play a greater role in South Asia.


What India feels


India's population is steadfastly pro-American and, with few exceptions, its mainstream political parties all support stronger U.S.-Indian ties. Yet, bilateral relations over the past decade have largely been a story of Washington courting New Delhi. The U.S. had an obligation to dispel Indian doubts about America's reliability and utility as a partner, given their troubled history. However, the U.S. is walking the walk. On his trip, President Obama stated "the United States not only welcomes India as a rising global power, we fervently support it" and those words have been backed by nearly a decade of U.S. foreign policy.


How should New Delhi reciprocate? Most importantly, India must move to fulfil its end of the U.S.-India nuclear deal. While the U.S. did most of the heavy lifting on that agreement, its economic and geo-political benefits fall largely to India. Yet New Delhi recently passed nuclear liability legislation that included a poison pill making it impossible for U.S. and other international companies to do nuclear business in India. Even India's own nuclear industry admits New Delhi must find a way to amend, rewrite, or re-interpret this legislation.


Diplomatic role


In the diplomatic arena, Washington would like to see India play a more constructive role in multilateral efforts to sanction Iran over its nuclear programme. Technically, India has been compliant but it has been a hesitant partner in the sanctions process. In January, 2011 India will assume a rotating seat on the Security Council for a two-year temporary term, where Iran will be a frequent topic of discussion and where India can showcase its role as a responsible global power. Elsewhere, the U.S. has encouraged India lift barriers to trade and restrictions on foreign investment such as onerous offset criteria. Washington also has been urging India to sign several defence cooperation and logistics agreements with the U.S. and to consider joining a handful of international non-proliferation treaties.


American can do more too. An onerous hike (700 per cent) in the fee for H1-B visas disproportionately affects Indian workers in the U.S., who now constitute the most affluent expatriate community in the country. New Delhi understandably saw that as a protectionist snub. Washington can also work to dispel Indian doubts about its policy in Afghanistan. India has a great stake in the country's stability and fears the potential aftermath of a precipitous U.S. withdrawal. As for U.S. policy in Pakistan, fundamental changes are in America's own interest let alone India's, but for a myriad of reasons its options are severely limited until the campaign in Afghanistan winds down.


In other words, both sides have work to do. President Obama's trip successfully affirmed his commitment to move the U.S.-India relationship forward. The ball is now in New Delhi's court.


( Jeff M. Smith is the Kraemer Strategy Fellow at the American Foreign Policy Council, a think tank based in Washington, DC.)











Democracy for Myanmar (Burma) under a newly freed and charming grandmother, with no taste for personal revenge for years lost under house arrest — how rare and refreshing to find a cause that unites left and right across the globe in these deeply divided times.


We have got used to polarisation around the causes that define our epoch: the war on terror, Palestine, the western wars in Muslim countries, climate change, civil liberties. The significant political fault lines of yesteryear — anti-colonial struggles in Africa, Latin America's years of military repression, South Africa's tortured wait for majority rule — were similarly dramatically divisive. In Britain the great and the good were thin on the ground to support popular movements in these arenas, which all posed fundamental challenges to the power relations in the world.


The world view


The great Bishop Trevor Huddleston, for instance, leading Britain's Anti-Apartheid Movement, had a terrific fight during the Thatcher years to advance his moral vision of the wickedness of indifference to apartheid. Nelson Mandela's image took a long time to change to friend of big business interests and movie stars. As late as the 1980s, editors still had the habit of asking correspondents for "perhaps more balance" when reporting the outrages perpetrated by white rulers in South Africa, as in covering Palestine.


No one today would suggest a more benign view of the Myanmarese generals who have ruined their country, made it a byword for torture and forced labour, sent tens of thousands into exile, and still hold more than 2,000 political prisoners. From Desmond Tutu and Vaclav Havel, to Harvard Law School, Amnesty and Gordon Brown, condemnation of Myanmar's military government has been a constant and consistently ineffectual backdrop to Aung San Suu Kyi's imprisonment and the appalling circumstances endured by the country's persecuted students, monks, minorities and opposition members. Myanmar has always been an outsider's fashionable cause, regardless of what your political affiliation.


This may be partly because the Myanmarese struggle, taking place so far away in an unfamiliar land, is not one that westerners feel individually or nationally implicated in. Indeed, the main support for the regime over the years has come from China, now a convenient bogeyman for economic reasons.


This response is also influenced by how Myanmar is perceived internationally. No significant boats will be rocked on account of changes in that country. It has no strategic or geopolitical importance except to its regional business partners — again, that being China in particular.


Suu Kyi and Mandela


It is also a reflection of how Aung San Suu Kyi herself is viewed. Unlike the world's former favourite ex-political prisoner, Nelson Mandela, she has no shadow side — Mandela was of course also leader of an underground army trained in the Soviet Union during the Cold War. Gentle, attractive, passive under house arrest and thoughtfully circumspect now freed, she has almost come to symbolise the perfect captive.


]With her immense bravery in the past, and her quiet determination now to open dialogue and to refrain from condemning her military jailers, she is a figure in striking contrast with today's political leaders we love to mock.


The parallels drawn at the weekend with Mandela's release were inevitable — but not because there is in Myanmar the slightest resemblance to the dramatic conditions that came together in South Africa at that time and the international support for a stable business climate, which brought the end of white rule there.


The parallels are with the existence of an international hero who serves as a safely removed parental figure and embodies characteristics now so rare in public life: integrity, dignity, and hope for bringing change to a desperate society that most of the world has chosen to forget for so many decades.


Forty years ago, getting a rare visa to visit Myanmar, I saw a country that was already paralysed by the military takeover of 1962 and the imposed isolation which followed. I remember Myanmar's silence and what I wrongly took for peace among the mountains, rivers and pagodas. I remember the other-worldliness of the highly educated woman on the bus who gave me three tiny gemstones to thank me for the pleasure of speaking English, the city of Mandalay entirely populated by softly smiling monks, and the extraordinary impossibility of casual conversation with Myanmarese people. It was impenetrable, and the attraction of these contained people, embodied in Aung San Suu Kyi now, has captured the world's attention.


Change in this tortured society will take more than verbal support for democracy from the outside world, and the Myanmarese know it will be their own fight, far away from Aung San Suu Kyi's western well-wishers. — © Guardian Newspapers Limited, 2010









Could the global financial crisis further marginalise the world's poorest countries? The answer may well be yes if European governments get their way in implementing a little-known initiative dreamed up by policymakers in Brussels and backed by the British government.


Two years ago EU governments quietly launched a new strategy to address its dependence on imports of "strategically important raw materials" — especially "hi-tech" metals like cobalt, rare earths and titanium — along with wood, chemicals and hides and skins. Access to these was seen as critical to the EU's industrial competitiveness. The European commission is about to release a progress report on implementing the strategy — dubbed the Raw Materials Initiative — that is likely to mark a step-up in a new global resource grab.


In order for EU companies to gain access to new supplies of these raw materials, Brussels is pushing for fundamental changes to other countries' trade policies. It wants developing countries to stop restricting exports of these materials and to abolish investment rules that deny EU companies access to them. The main targets are China, Russia and Ukraine — and, critically, poorer African countries. The problem is that such "restrictive" trade policies can be critical to reducing poverty, something that EU free trade ideologues continue to reject.


In Kenya


The Kenyan government, for instance, imposes a 40 per cent tax on exports of raw hides and skins from cattle, to keep them in the country and develop the leather processing industry. Exports of leather have boomed since the tax was introduced, adding €80m to government revenues since 2005 and helping to create 7,000 new jobs in Nairobi's tanneries. Yet, in trade negotiations, the EU is pushing for severe limits on the use of Kenya's export taxes, as it is with the 70 other countries applying similar restrictions.


The EU wants its companies to have the same access rights to raw materials as local businesses. It rejects the idea that poor countries should restrict foreign investment to promote industrialisation, even though the most economically successful countries, including most EU states, in the past often did precisely that. As Ha-Joon Chang wrote in these pages last week, South Korea owes its staggering rise to wealth partly to banning foreign investment in key industrial sectors and imposing limits on foreign ownership of companies.


Land for biofuels


EU firms have already acquired or requested 5m hectares of land in developing countries to produce biofuels.

With investment barriers eliminated, land-grabbing, deforestation and dubious mining projects by EU companies are likely to multiply. Poor countries need to attract more investment but on their own terms, not those of EU firms.


If preventing development were not enough, the EU's new resource grab also risks increasing tensions among the world's great power blocs. China and the west are vying for control over raw materials while Africa remains plagued by conflict over diamonds, timber and oil. According to the U.K. Ministry of Defence, the shift in global power from the west to Asia, along with the challenges of climate change, resource scarcity and population growth, are likely to result in "intense competition between major powers" and "scrambles for energy, minerals and fertile land are likely to occur with increasing intensity."


EU trade policy has long been hijacked by European business, which wants raw materials at cheap prices. EU priorities are a mirror image of positions adopted by corporate lobby groups. The commission frankly states: "We will rely on EU business to provide much of the information on the barriers which affect their trade or investment with third countries."


There is a serious risk that Europe's budget and unemployment crisis will put policymakers even more in hock to the demands of big business.


Opposition from Africa


It is hardly surprising that European policy faces mounting opposition from most African countries, which have long opposed signing investment agreements with the EU. The Raw Materials Initiative should be opposed by Europe's citizens, too, because it distracts from the need to reduce their own consumption. Europeans already consume four times as much as the average African. It is in their own interest to demand new international action to manage use of the world's limited natural resources equitably and sustainably. (Mark Curtis is author of the Traidcraft report – The New Resource Grab) — © Guardian Newspapers Limited, 2010








It is not every day that the leader of the country's most reputable industrial house goes public — as Ratan Tata did on Monday — to say that over a decade ago he couldn't start a new aviation enterprise as he refused to pay a bribe of `15 crores, and his speaking to three successive Prime Ministers (H.D. Deve Gowda, Inder K. Gujral and


Atal Behari Vajpayee) was of no avail. This at once points to the depth of the crisis we face as a society and a nation, and to the inherent difficulties in eradicating the scourge of corruption which is eating into the vitals of our public life, in the process marring national progress and the prospect of helping those at the bottom of the heap to surmount poverty.

Mr Tata's revelation, of course, points to a malaise that we are only too familiar with. The theoretical proposition is accepted that systemic corruption — when national institutions of every kind are in the grip of malfeasance — is a characteristic of developing or underdeveloped societies. The point, however, is that a developing country that resolves to forge ahead must find ways to reduce the systemic corruption that chokes it at every step, and one day to eliminate it in the not too distant future. Only then can we be assured that we have transcended the ranks of developing states. This is not to say that developed countries are strangers to corruption. But in those territories the malaise is not systemic and therefore easier to deal with.

If the problem lies at the root and has spread like a blood infection to every artery, then we may be certain that nothing but the most drastic action to eradicate it will do. It is no one's case that this cannot be done, although it is clear enough that it will take a lot of doing. If the political leadership appears determined — as we have lately seen in the case of the Adarsh Housing Society scandal, the Commonwealth Games scam and the allegations concerning 2G spectrum allotment — a beginning can be made. But we should not pat ourselves on the back too early in the day, although it is an encouraging sign that key officials associated with CWG have now been arrested. As we go along, we may just discover that vested interests will do what they can to thwart meaningful investigations. It is important for the political leadership to stay the course. Other than expressing moral indignation, which we should not cease to do, official procedures require to be seriously modified so that the environment that breeds some of the corruption can be altered. In his early days as Prime Minister during UPA-1, Prime Minister Manmohan Singh gave the impression of launching on such a course, but he appears to have got distracted from that objective.

As the size and power of India's economy grows, and we are able to rise from being a shortage economy — where demand outstrips supply and the system turns into a breeding ground of corruption — we may find we are beginning to beat the scourge. But there is nothing automatic about the process. The political leadership at all levels — national, state and local self-government — needs to be relentless in its pursuit of the goal for cleanliness in public life. Corruption in the various branches, such as the bureaucracy or the police, is likely to be greatly reduced if the political bosses — irrespective of their party colour — crack the whip. For this to happen, the party system must rise to the occasion. It must nominate only clean individuals with a transparent record of public service for elections. Only then will legislatures and governments begin to look purpose-oriented and taint-free.








IF INDIA has been jubilant over US President Barack Obama's visit, an important reason is his virtually unqualified endorsement of Indian quest for a permanent seat on the UN Security Council that is a departure from the previous American position. A typical reaction to it in the world media was that the US president had given a "push" to India's "ambition". How long will it take for the ambition to be fulfilled is the question, and on this opinions vary widely.


Many in India's foreign policy establishment think that this could take as long as a decade. Some others have gone so far as to declare that Mr Obama's promise of a permanent seat was a "pie in the sky". Most American sources also believe that it would take quite some time before the package of the Security Council reform and the composition of its enlarged membership can be wrapped up. Of some interest is the estimate of a distinguished Chinese academic, Shen Dingli of the Fudan University. Unlike the government of his country that continues to be ambiguous, he supports India's claim to a seat around the horseshoe table at Turtle Bay in New York categorically. Yet he believes that it has taken 15 years to reach so far, and that another 15 years might be needed before the exercise of reforming global governance could be completed.

In view of all this it is all the more remarkable that the mood about the expansion of the Security Council at the most important venue, the UN itself, is vastly more upbeat, as I witnessed during three working days there last week. One telling phrase I heard at almost every step was: "This is an idea whose time has come and there is overwhelming support for the expansion of both the permanent and non-permanent membership of the Council". Some sources said that in December 2009, ambassadors (technically, they are called Permanent Representatives) of 144 countries had signed a letter demanding that the facilitator should prepare a text for inter-governmental negotiations instead of spending time in informal "discussions" in an open-ended working group. The number 144 far exceeds the two-thirds majority of the General Assembly which is needed to amend the UN Charter.

The Security Council per se has no say in this matter though by virtue of their clout the five permanent members can and will influence the voting pattern. Even today the clout of the US remains unmatched, as became evident last week. America succeeded in blocking the election of Iran to the executive of the women's committee of Economic and Social Council (Ecosoc). Iran got only 19 of 54 votes, while East Timor, a last-minute US-backed candidate, secured 36. India was elected by 52 votes.

To be sure, even the optimists about an early reform and expansion of the Security Council readily admit that a great many rival, sometimes overlapping, sometimes clashing claims of different groups have to be reconciled before an agreed resolution can be tabled and passed. For, different groups and countries have different demands of their own. For instance, the Africa Group, consisting of 53 member states from that continent wants two permanent and two non-permanent seats on the expanded council. This is a legitimate aspiration though the North African states do not want to be left out. The so-called "L-69" Group, so named after the number of a relevant resolution, with 44 members, is broadly in favour of early reforms subject to its interests being protected. Similar is the stand of small island states. The Coffee Club, claiming a maximum membership of 10 but never able to mobilise that number, consists of those who want to keep some other country out, such as Pakistan that constantly trains its guns on India, Argentina that wants Brazil out, South Korea strongly opposed to Japan and so on. The main motive behind the campaign for early reforms is G4, comprising India, Brazil, Japan and Germany.

Despite the enormity of the task, the predominant view among the movers and shakers at the UN headquarters is that the necessary consensus need not take one or two years because everyone is slowly realising what is possible and what is not. For instance, an unwieldy council would not be acceptable. Therefore, the optimum size could be in the mid-20s, in place of 15 at present. Non-permanent new members would have to exceed new permanent ones. The red-herrings across the trail suggesting undefined "interim" or "intermediate" models of change make no sense.

The other issues on which a consensus has yet to be evolved can be summed up briefly even though these cover 80 pages compiled by the facilitator, Ambassador Tanin. Veto is at the top of them. The Africa group persists in its demand that all new permanent members should have the veto exactly as the present P-5 do. But opinion seems to be veering round the G4 view that all permanent members should indeed have the veto right but in their case it should be put into operation after 15 years when the whole issue is reviewed.

Even today veto is used rarely; by then it might become irrelevant. Moreover, the working methods of the Security Council would have to be improved so that it does not encroach on the functions of the General Assembly. Finally, there should be regional balance but permanent members from each region should be selected on the basis of the criterion already mentioned in the UN Charter.

As for India's permanent membership, it has full support of four of the P-5. The only exception, China, "understands" but does not yet support India's interest in a more active role at the UN. But indications in both Delhi and New York are that Beijing would not oppose India's presence at the UN top table. Japan's entry into the fray could be a problem because the US would back it to the hilt while China would do all it can to exclude Japan. However, there is no need for India to get involved in this conflict. Finally, the US support is accompanied by the demand that India must act on Burma and Iran according to America's wishes. New Delhi's inability to do so must be conveyed courteously to Washington.








On November 7, the Burmese people voted for the first time after more than two decades, both for the People's Parliament and the Nationalities Parliament. While the much-touted elections and the run up to it were critical, the actual event was marred by rigging and intimidation. Voter turnout in a country that has not seen an election in two decades was low, revealing that people had very little hope of things changing. The last elections held in Burma were in 1990 when the National League forDemocracy (NLD), led by Aung San Suu Kyi, won a landslide victory. The ruling military junta, however, did not transfer power to the NLD and kept Ms Suu Kyi under house arrest for almost 14 years.

The two parties that were the forerunners in the 1990 election — the NLD and the Shan National League for Democracy — were both dissolved prior to the November 7 elections. Both chose to remain outside the rhetoric created by the State Peace and Development Council (SPDC), which is the official name of the junta. Thirty-seven political parties participated in the elections, though the NLD was probably most qualified in terms of political acumen and leadership.

One deterrent for several smaller parties participating in the elections was the high cost of registering candidates. The alliance of six small pro-democracy parties, called the National Democratic Force, was also ineffective because it was loose-knit and did not define itself coherently in terms of its mandate. Another factor was that it lacked able leadership.

Two of the most significant parties participating in the elections were the Union Solidarity and Development Party (USDP), which had its origins in the Union Solidarity and Development Association (USDA), a closely knit association of the ruling military officials. The USDA changed its name to USDP in order to provide a greater legitimacy for its participation in the elections.

The other was the National Unity Party (NUP). The NUP evolved from the Burmese Socialist Programme Party (BSPP) which became a platform for the military junta in the Sixties and Seventies. As early as the Sixties, the BSPP was crafted by General Ne Win to lend credibility to the military rule. The BSPP renamed as NUP contested the elections in 1990. However, there is a view that over the years this group has moderated its stance and was contesting elections on the grounds that a political transition was crucial for Burma.
Given that both USDP and NUP had a stronghold in the elections as compared to the other registered parties, their ability to influence the outcome would have been better. In this background it will be no surprise if the USDP emerges as the forerunner. It is even being speculated that they will win a majority of the 330 seats in the People's Parliament and the 168 seats in the Nationalities Parliament. Even as the results are awaited, the response of the international community to the elections has been one of disappointment, mainly on account of the fact that the rhetoric of the elections did not meet the promise of expectations.

What remains a puzzle to most Burma observers is that within a week of the elections the junta has released Ms Suu Kyi. While she was the most high-profile political prisoner, there are still about 2,200 political prisoners awaiting release. Moreover, with Ms Suu Kyi's promise that she will continue the democracy struggle, one wonders how long she will remain free. If her release had occurred before the elections, it would have encouraged the NLD to actually contest the elections. This release seems to be more of a negotiating exercise to quell the international opinion that has emerged in the aftermath of the elections — that there is little hope of change within the ruling junta to allow for a free and fair electoral process to shape the political developments within Burma.

In the speech following her release, Ms Suu Kyi urged the Burmese people to continue the struggle for freedom and the fight for their rights. She also hinted that she would urge the Western countries to end the sanctions against Burma and search for new options to bring about international pressure upon the junta to change its stance within the country.

For the international community Burma will continue to pose a challenge. With deeper entrenchment of the junta, little change is to be expected and this means that the measures to engage the junta through diplomatic channels of the Association of Southeast Asian Nations (Asean) and other nations that remain cooperative to the junta will make no headway. The idea of six-party talks for Burma, along the lines of the North Korea talks, has not even made its beginning.

Given that there is a role for both the international community and the United Nations in Burma, perhaps this would be the time to look for a new initiative along the lines of the United Nations-mandated transitions in Cambodia and East Timor. The UN could administer the nation during a transition phase in which political parties could be engaged in a process of national reconciliation. The UN could also allow for the role of the six parties at the international level to assist the process of change. Given that there has been a military government in place since 1962, this would allow the UN to dismantle the administrative structures that the junta has created and controls. This would ensure greater and wider participation, a necessity in the run up to a free and fair election.

The UN role would also allow for the representation of ethnic groups that make up the mosaic of Burma. These groups have not found adequate representation and the elections left several areas out of consideration because of the volatility of the situation. A more concerted effort towards national reconciliation and participation would include these groups too.

The junta may feel complacent with the outcome of the current election, but the leadership in Burma needs to realise that it is a matter of time before its presence is challenged.


Dr Shankari Sundararaman is an associate professor of Southeast Asian Studies at the School of International Studies, JNU









Baywatch star Pamela Anderson uses her glamour status for a good cause. The woman who has heartily lived up to the image of a sex icon and who is now in India to be part of a reality show, uses her celebrity power with conviction.


Her letter to prime minister Manmohan Singh protesting against the inhuman treatment of animals by the Indian leather industry is something more than a cause celebre. It is a sincere plea from a woman who is moved by the plight of hapless animals.


Perhaps her demand that leather goods should be proscribed has a touch of unreality to it. It is not something that can be done with the wave of a wand. What is not to be doubted is the moral passion of Anderson. She can well argue that there should be no compromise on ideals and practicality should not be a consideration when values are at stake.


The popular TV star, who will be wearing a saree in the reality show instead of her trademark Baywatch bikini, told Manmohan Singh that Indians have a natural respect for animal life. We may not live up to our image always, but it's time we did.






Ratan Tata set the cat among the pigeons when he narrated a conversation with a fellow-industrialist about bribing ministers. The industrialist apparently was surprised that Tata was still struggling to get his airline project off the ground when it was well-known that the minister concerned was keen on a Rs15 crore bribe.


So what's new? The real story is not about Tata not paying a bribe, but that there are so few people willing to follow his example. It also speaks much for our own cynical approach to corruption that the most important question that came to mind was not why this was happening, but who might have sought the bribe.


Tata, of course, was unwilling to oblige the media by naming names, and that was a good thing, too. Witness the recent obsession with the Kalmadis and Rajas of the world. The media went after individuals without asking questions about the systemic conditions that allow bribery and corruption to become the norm in business-government interactions.


More striking is the industrialist's observation that Tata was being stupid in trying to go against the system. By implication, the former seemed to accept ministerial corruption as a reality. One had to accept it as a fact of life to get business done in India. Reading deeper into it, it seems likely that the proportion of businessmen willing to pay for removing ministerial obstructionism is greater than those willing to stick to the straight and narrow.


There is also another point. As the owner of India's largest business group, Tata can perhaps take the high moral ground and write off one project because there are many others in his kitty. If Mamata Banerjee doesn't want him in Bengal, he can go to Gujarat. But imagine a situation where an entrepreneur is trying to make a mark with his first big project. Is there any way of avoiding a bribe to get things done?


Now that Ratan Tata has mentioned the unmentionable, it will be difficult for industry and business to put the question quietly back into the bag as if it had never been raised in the first place. There are three huge scams currently under investigation — the Commonwealth Games, Adarsh Housing and 2G spectrum. All of them involve gross misdemeanours of the highest order, sanctioned by ministers and babus.


Systemic corruption is clearly getting out of hand. The sheer scale and size of the problem is going to make the India story unviable. Only systemic reforms can eliminate this unholy tax.







India is the sick man of Asia. We have the worst infant and maternal mortality rates in the world. We are prone to diabetes and heart disease. Despite decades of effort, TB is running rampant. We account for 20% of the diarrhoea deaths in the world.


Cases of chronic respiratory disease are ballooning. Some of these are age-old problems; others have developed with changing lifestyles. But the cause for most remains the same: systematic neglect.


India's healthcare system has not managed to deal with the challenges before it. Investment has not been made at the basic levels. As a result, no matter how fast we run, we never get anywhere near a fair distribution of healthcare. Infant and maternal mortality is usually the first challenge dealt with in any developing society, yet we are nowhere near conquering it.


Diarrhoea requires simple steps to counter it, but we do not have the wherewithal to even spread the word. TB medication is easily available, but sustained neglect has led to new and difficult strains being formed. India lost 2.8 lakh lives to TB in 2008 and added two million new cases last year.


We talk about inclusive growth, but by spending as little as possible on health and education, we have damned several generations of Indians to low standards of living and abject poverty. We have also weakened any possible chance of an improvement within our lifetimes. If instant action is not taken, we will reach a Sisyphus-like situation, where the boulder will fall back down the hill every time we make efforts to raise it.


No nation can consider itself truly developed, powerful or important if it fails its people at such basic levels. Health and sanitation have been ignored at our own peril and the most vulnerable are paying the price. The effort has to come now not just from government but also from the medical community and civil society.


The numbers are too appalling for them to continue burying their heads in sand. A rise in disease levels is no different from a terrorist attack. We have to fight back with a sense of urgency.








What's a sacrifice? A sacrifice, usually taken to be the slaughtering of animals, is more than that. A mother sacrifices her sleep for her children. Prophet Mohammed himself has been the embodiment of sacrifice all his life. The sacrifice of the animals is just a ritual whereas the essence lies far beyond.

After the five pillars of Islam, Sunnat-e-Ibrahimi (sacrifice) is the most important activity. This sacrifice is the legacy of Prophet Ibrahim who entertains the Prophetic patronage from three religions ie Jewism, Islam and Christianity. The festival also


symbolises the test of faith and loyalty to God.


The Islamic legend goes that Prophet Ibrahim was 90 and childless. After sustained prayers, God heeded and blessed him with a child named Ismael at this ripe old age. But soon after the child had grown a bit, God ordered Prophet Ibrahim to sacrifice his dearest thing. Ibrahim sacrificed his favourite camel. But when the same command appeared thrice, Prophet Ibrahim understood that God demanded the sacrifice of his son, Ismael. When he asked for his only son's consent, Ismael was only too happy to ask his father to carry out God's order.


The child was to taken to the sacrificial altar. While on the way Iblis (Satan) tried to misguide the father and son that God's demand was too unethical and tyrannical and that they should not follow Allah's command but it was futile on the part of the Satan. It is said that while Ibrahim was slitting the throat of his son, angels in the heavens wept with heart-rending cries. Ibrahim covered his eyes so that he may not waver.


After having slashed the neck of his son, Ibrahim saw his son was playing. Instead, a ram was lying sacrificed. This was the reward of God. It is clear that God didn't want sacrifice of flesh and blood for His own sake. He wanted to test was the love and loyalty of His messenger.


Eid is also a day on which Muslims remember the deceased, visit the sick, see relatives and friends, overlook grudges, help the needy and show kindness and generosity to all. It is also a day for rejoicing by getting involved in a good, clean and halal ie honest enjoyment. In fact, sacrifice is the essence of life and we should leave no stone unturned to sacrifice our money, comfort and time for the downtrodden or deserving.








Currency 'war' is the new catchphrase setting the current international financial and economic processes on fire. But many nations, and of course governments, are struggling to determine their position on this war.


To start with, it is necessary to delve into the nature of this war, before taking a view on the course of its development to secure and salvage our own national interest. And, it is also pertinent to define 'national' as opposed to the narrow interest of a select few.


The deeply polarising discourse confirms the skepticism that many of us shared over claims about the recovery from the deadly blows of a global economic recession that followed the global financial meltdown. The valuation of national currencies is the sovereign function of a nation state. The tendency of nations to keep their currencies depreciated relative to other currencies arises from the inclination to accrue benefits from larger exports which, in turn, reflects in higher output and employment figures.


Now the need for taking recourse to such an approach gains greater momentum in a situation characterised by sluggish or virtually no growth in the overall aggregate global demand. It is in such a context that a nation has to opt for keeping its currency depreciated to corner a greater proportion of global demand relative to other nations and economies. Therefore, currency war is often referred to as a trigger for 'beggaring thy neighbour'. The raging debate on this so-called war is a clear admission that the recovery from the recession is far from complete.


Data on employment and savage cuts on social security in developed countries have established this. But since there was an election underway in the US before the G20 summit in Seoul, "blaming the other" was very much on the cards.


What is the US claim? The gurus of the Anglo-US brigade claim that the currency war is the outcome of the policies of newly emerging economies — particularly China and some other Asian countries, including India. They say that the imbalances in the global economy arise from the US's massive current account deficit, coupled with current account surpluses of China and other emerging economies. This results in flight of capital away from crisis-hit deficit economies.


This could be prevented if China allowed its currency to appreciate. But by refusing to do so, China has encouraged this flight and piled up its foreign exchange reserves. So, China is the sinner — and there is a call for retribution. Nobel Laureate Paul Krugman has led the war cry of launching a trade war against China and imposing penal tariffs against Chinese exports.


That there is very little chance of achieving a consensual approach among the developed economies is clear. Economies like those of Germany and Japan, which clock a surplus, do not share this approach of the US. For example, Japan is one of the biggest beneficiaries of the Chinese economic situation and, therefore, does not share this acrimonious approach of the Obama administration.


The other issue pertains to the non-tenability of such unilateralism. Even if China allows its currency to appreciate, it will obviously respond by adjusting its domestic policies with a greater emphasis on government-led domestic spending. Will those mandarins of the Anglo-US brigade, who are up in arms against any sign of expanded government intervention, be in a position to accept such a course of Chinese intervention?


And then there is a question of history. The genesis of the current managed exchange rates started with the US abandoning the dollar's link to gold. This made the dollar the most preferred currency of exchange. This advantage allowed successive US administrations to build deficits that have now reached unsustainable limits. The consumption of cheap imports and the housing bubble also contributed to the present predicament of the US economy. The cost of the first was loss of manufacturing jobs.


The second has drawn the US economy into a recessionary crisis and sent shock waves through the entire global economy.


So, ideally, this should have been a time for introspection, not for hurling threats about waging currency wars. The imbalance is a reality. But it is a result of past policies. It can be corrected by revisiting some of the basic policy prescriptions that have guided the course of the global economy for the last four decades.


Meanwhile, claims and counterclaims will excite the world.


Columnist Martin Wolf claims America is going to win the currency battle and the Chinese economic commentator, Yiping Huang, rebutted him saying the "US would lose a currency war". This reflects the Chinese mood today. The currency war is a rhetorical war born out of a desperate US administration trying to gloss over past follies. A more realistic view would help the US play a much humbler role in the emerging multi-polar economic and financial world.









IT is unfortunate that the Opposition continues to disrupt the proceedings of Parliament on the issue of 2G Spectrum allocation. Even after A. Raja's resignation as Telecommunications Minister on November 14, there is no end to the stalemate. The Opposition wants a Joint Parliamentary Committee (JPC) probe into 2G spectrum, Commonwealth Games and Adarsh Housing Society. However, the government says that there is no need for a JPC as the Public Accounts Committee (PAC), headed by BJP leader Murli Manohar Joshi, will examine the Comptroller and Auditor-General of India's report on the telecom scam which was tabled in Parliament on Tuesday. Technically, the mandate of both the JPC and the PAC is the same. While the PAC has 22 members (15 from the Lok Sabha and seven from the Rajya Sabha) on the basis of the proportionate representation of political parties, the JPC has no prescribed strength and every political party, including senior members, will get represented in it. Apparently, that's why non-BJP MPs are strongly batting for a JPC. There is an erroneous impression that the JPC has "wide ranging powers" as compared to the PAC and that the latter's scope is "limited to accounting discrepancies". Even successive JPCs' success rate is poor. The one on Bofors, for instance, ended up as a cover-up exercise. Obviously, the Opposition is making a hue and cry over the JPC for political expediency.


Union Finance Minister Pranab Mukherjee's luncheon meeting with the Opposition leaders on Tuesday failed to end the impasse. Mr Mukherjee has said that he will report the matter to the Prime Minister. Whether the Centre finally yields to the Opposition's demand for a JPC or not, every MP is duty-bound to ensure that Parliament's work is not hindered anymore. In the current session, Parliament is scheduled to examine 23 Bills in 24 sittings until December 13. How will it carry out this legislative business if it is adjourned day in and day out.


In the last session too, Opposition MPs had paralysed Parliament for a week demanding an adjournment motion on price rise which would have entailed voting. No government can succumb to the Opposition's pressure tactics. But then, the government should also be flexible and try to accommodate the Opposition's wishes if it helps to break the logjam. As frequent disruptions will render Parliament irrelevant, there is a strong case for cutting the MPs' daily allowance of Rs 2,000 as a deterrent. Ironically, while they have substantially hiked their pay, perks and allowances, they do not bother about the incalculable damage they are inflicting on Parliament through disruptions.








WHAT Tata Group Chairman Ratan Tata has said about the all-pervasive corruption may be sensational stuff but is nothing unusual for the common man. He faces it at every step, every day of his life. Mr Tata has revealed that 12 years ago, his domestic airlines project with Singapore Airlines as partner was shot down on flimsy grounds over a period of time which saw three Prime Ministers change. A particular individual thwarted the efforts and they had to finally abandon the project. Interestingly, a fellow industrialist advised him to pay the minister concerned Rs 15 crore if he wanted to get the project cleared, but Mr Tata did not do so. He is an exception; most others find it more pragmatic to succumb. Some of them who make it are rogues who get lucrative projects by greasing the palms. Worse is the fate of those who have to pay even if they are eminently suited to get these but the corrupt officials make them corrupt even for getting their due. The ultimate sufferer is the common man who pays the taxes and also elects the corrupt leaders, who act as "commission agents".


Quite expectedly, the remarks of the highly respected entrepreneur-industrialist have raised a storm, with a former Civil Aviation Minister C.M. Ibrahim threatening to commit suicide unless Mr Tata names the minister. Unfortunately, it is not the question of the integrity of a person but of the entire system. The rust has affected the entire steel frame of the administration. Whenever such ugly stories come to light, the culprits demand proof, as if money is sought and given in front of TV cameras.


Instead of swallowing the heady brew offered by visiting dignitaries like US President Barack Obama that India is not a developing power but already a developed country, we must focus on the ground reality. We continue to figure extremely high on the corruption index and very low on the human development index. There is so much to set right that nothing gets done at all. If the government can rein in its own ministers and officers, India will be a far better place to live than what it is. But who will bell the sarkari cat? 









FOR the first time in India's post-Independence history, the country's apex court has had to step in to take note of something that successive governments have been dragging their feet over — creating and mandating a body to examine all grievances of service personnel. This is all because successive governments have been unable to redress a long list of accumulating grievances of its serving and retired soldiers, sailors and airmen of a military which remains among the world's most engaged — an armed force that has combated a range of challenges that have included fighting conventional wars, proxy wars, insurgency and terrorism, and handling breakdowns in law and order arising out of political and administrative mismanagement in geographically diverse terrains ranging from mountains, deserts, jungles and rivers.


Noting that armed forces personnel harbour the feeling that their grievances are not being properly addressed and should be heard by an independent body, the Supreme Court in its unusual but welcome step has directed the Union government to establish an Armed Forces Grievances Redressal Commission within the next two months. The Commission will be different from the recently established Armed Forces Tribunal passed through an act of Parliament which decides cases pertaining to personnel issues concerning servicemen. Although the Commission is to only be a recommendary body and not an adjudicatory body, it has nevertheless been given the blanket mandate to look into any grievance by serving or former members of the three services or their widows or family members and recommend appropriate measures to the Union government.


The Supreme Court's decision has been sparked off by the sordid case of a widow who was drawing a monthly pension of a paltry Rs 80 even though her husband, a Major, had fought in the 1947-48, 1962 and 1965 wars and been decorated with 14 medals. The apex court has chosen the Commission's chairman, vice chairman and members wisely – all distinguished men known for their integrity and professionalism and comprising a mix of two retired judges and two senior retired Army officers. But eventually the onus of redressing issues will still lie on the government which can ill afford to ignore dissatisfaction in the ranks of a military force of a country that continues to have disputed borders with its two biggest neighbours and is located in a challenging and adversarial neighbourhood.
















NOW that the dust has settled, Obama's visit can be properly adjudged a success. As usual, a section of the Press and commentators, the BJP and the Left came to dire conclusions before the event and made a strategic retreat as events unfolded. It is astonishing how gullible and chauvinistic some channels and opinion makers can be but remain unabashed despite getting it wrong every time. India has not sold out to anybody and a new and constructive Indo-US engagement is in the process of being forged. Hurdles remain, as they will among friends and democracies. But they do not undermine the basic bonds that are strengthening.


Obama did not appear a weakened President despite his mid-term Congressional reverses while Dr Manmohan Singh said what he needed to say with quiet and convincing dignity. The President estimated the $ 10 billion agreements signed would create 54,000 jobs in the US. The economic and technological relationships now evolving between the two countries are mutually beneficial and no strategic relationship will be to India's disadvantage. One message that has come through clearly is that both sides know they need the other and should not permit ancient divides to cloud their future partnership, though tough bargaining remains on the cards.


It is disconcerting that Indian commentators made so much of what Obama said or did not say about Pakistan and its being a safe haven for terrorism. The very fact that he stayed at Taj Mahal Hotel in Mumbai, laid flowers at the 26/11 memorial with families of some of its victims gathered around and said that those responsible for the carnage must be brought to justice and their safe havens in Pakistan denied, was eloquent enough. In turn, India made known its disappointment at the delayed and limited collaboration earlier manifest regarding Headley, a double US-Pakistan jihadi agent.


It is demeaning that India looks for a US gift of a permanent seat in the Security Council. Obama endorsed that but suggested that India speak up on human rights violations in Myanmar (Burma), where fake elections have just been held, and on Iran. The snub was misplaced. Washington has been pusillanimous where its geopolitical interests are involved. Cheveron has stakes in Myanmar's Yadana offshore gasfield despite sanctions. On Iran, India got the US to commit itself to "continued diplomacy" (not regime change) while its quiet advice to the junta in Myanmar has always been to move towards democratic freedoms.


The main thrust of Obama's discovery of India was his acclamation of its unique democratic roots. He saw this for what it is, a truly incredible example, warts and all, of freedom with unity in diversity for a fifth of mankind, at a time when France has banned the burqa and Switzerland minarets, and Angela Merkel says multiculturalism has failed in Germany. He spoke of partnering India in rebuilding Afghanistan and of strategic consultations with India on East Asia, and the Indian and Pacific Oceans.


On J&K, Obama made the obvious point that a stable and prosperous Pakistan is in India's highest interest, and that the US will only intervene if asked by both sides. However, some Indians constantly re-hyphenate India with Pakistan. The real damage to national interest comes from the government's extraordinary inability to state the Indian case factually and forcefully rather than merely respond to Pakistan's negative founding ideology of being India's "other". Its consequent compulsion to "defend" Islam against perceived "Hindu imperialism" (read Kashmir) has created and sustained the military-mullah complex that holds its people in thrall.


The US has for 60 years armed Pakistan to the teeth, underwritten its economy and allowed it to acquire nuclear weapons and blackmail the world, mistakenly upholding its frontline ally — currently to secure Afghanistan and fight terror — though aware of its devious conduct in using terror and jihad as instruments of state policy. American policy has underwritten state power in Pakistan's military and enabled it to suppress democracy. This is grim irony. The Kerry-Lugar Act, designed to hold Islamabad to its pledge to devote the many billion of dollars of military assistance it is giving to fight Al-Qaida and Taliban terror, has been a dead letter. But Washington is up a gum tree and refuses to get down while Islamabad waits for the Americans to quit before taking over a client Afghanistan.


US militarisation of Pakistan has dried the roots of incipient democracy in that unhappy country. Its misguided and muddled AfPak policy, of which Bob Woodward writes, has become part of the problem rather than the solution. Washington's fear is that if it stops supporting the Pakistan military's extra-curricular activities, the Al-Qaida-Taliban and other jihadis will take over a failing state and access its nuclear wherewithal. The answer is to make a sufficiency of US economic and military aid strictly conditional on monitored performance and to support policies that regionalise the war on terror in AfPak. If Pakistan walks away, the threat of imminent economic collapse will bring the military to heel despite Chinese and Saudi assistance even as it institutionally strengthens the civilian regime.


Pakistan has a stake in Afghanistan and needs a secure though soft border along the Durand Line. But Afghanistan must be enabled to remain neutral and not pressured to submit to Islamabad's hegemony. India has no designs on Afghanistan and would readily support such a regime in cooperation with Pakistan and Iran.


Regionalisation of the AfPak war has hitherto failed because of Washington's visceral hostility towards Iran and its consistent bias against the Arabs in Palestine despite Obama's latest broadside against Israel's West Bank-East Jerusalem settlement policy even amidst peace talks. Despite Obama's reaching out to the Islamic world, Washington remains mired in a flawed West Asian policy with few knowing what to expect in Iraq.


These are the holes of its own making from which the US must dig itself out. The new Indo-US partnership lays a basis for mutual cooperation between Delhi and Washington to achieve peace and stability in this critical region and allow a democratic Pakistan to come into its own.








THE latest controversy surrounding the popular serial 'Rakhi Ka Insaaf', it is learnt, has forced a number of cops from police stations across the country to queue up outside the bungalow of Rakhi Sawant these days. Reason? Policemen want to learn the difficult art of tormenting feuding parties, as is done by Rakhi Sawant who subjected an already maligned, married man to such grilling during her show that he first went into depression and later died, thus becoming the first 'martyr' of a TV reality show.


The framing of Rakhi Sawant in a police case on charges of abetment to suicide has not diminished the enthusiasm of the popular TV host, who has vowed to deliver justice in the similar manner to those women whose marriage is on the rocks. Her quick delivery system has impressed the police administration, which has sent young officers to the house of Rakhi to learn how to extract confessions from hardened criminals. As for the present case, Rakhi has tried to convince her interrogators that her quick delivery system has brought relief to both the parties. She said she drew inspiration from Shakespeare's Julius Caesar where 'a coward dies many times before his actual death while the brave dies once.'


Daily fights and clash of ego send couples to run half marathons to police stations and courts. They only ruin the lives of both spouses. Hence, Rakhi insists that the ultimate aim of the programme is to deliver justice in a speedier manner which other courts have failed. To that end, her serial is also making a contribution towards reducing population.


A rumour is doing the rounds in Mumbai that director Ram Gopal Verma is toying with the idea of making a film 'Kaun Marega Rakhi Par" with Rakhi and Punjabi singer Mika Singh in the lead roles. The only hitch, it is leant, is that Mika is insisting on a few kissing scenes with Rakhi as he does not find himself less endowed than Imraan Hashmi. None from the Verma camp is prepared to tell whether the flick is a suspense thriller or a family drama.


Not to be left behind, newly sworn in Maharashtra Chief Minister Prithviraj Chavan has decided to appoint Rakhi Sawant as the state advocate-general to tame the two Daood brothers, who have been hoodwinking Interpol for a number of years now. Grapevine has it that the two brothers are finally thinking of surrendering before Rakhi Sawant to show respect to Indian law.

Meanwhile, Rakhi Sawant has enhanced her fees from Rs 50000 to Rs 5 crore, sending Amitabh Bachchan, Dabang Salman Khan and Aishwarya Rai in a huddle to revise their fees for future TV shows, to redeem their reputations.n 









THE government is in the business of procuring, storing and distributing food grains for safeguarding the interests of farmers and ensuring food security, especially to the poor. But both farmers and the poor are unhappy with the government agencies handling food grains.


Farmers wait endlessly for selling their produce in mandis as the procurement agencies, particularly the FCI, insist on prescribed specifications, including moisture content. The same procurement agencies, which deliver sermons day and night to farmers to follow the specification norms, forget to follow the manual for transporting and storing food grains safely.


This is due to a very weak accountability mechanism and the absence of regulatory authority observing their post-procurement actions. Interestingly, the callous approach of employees in handling food grains is a ground reality in a country where philosophically and culturally at the household level every grain is valued and not allowed to go waste.


According to one estimate, more than ten lakh tonnes of food grains have got damaged in FCI godowns only. If the damaged food grains in the godowns of state warehouse agencies are added, the estimate will go phenomenally high. The worth of damaged food grains works out to be hundreds of crores of rupees. Statistics further reveal that the FCI has lawfully spent Rs 240 crore on preventing damage to food grains. The damage multiplied at an alarming rate and the FCI spent around Rs 2.60 crore more to dispose of the damaged food.


Damage to food grains is not taking place due to lack of infrastructure, particularly godowns. Rather it is happening due to bad governance. According to information supplied by the government under the Right to Information Act, the FCI has around 256.64 lakh tonnes capacity of covered godowns against which the FCI has stored about 218.35 lakh tones, thus leaving a margin of 38.28 lakh tonnes, which can be stored additionally. Geographically speaking, the FCI has idle storing capacity.


The northern region has 111.22 lakh tonnes of food grains in stores against the total storing capacity of 127.48 lakh tonnes. The respective figures for the southern regions are 57.39 lakh tonnes and 54.24 lakh tonnes. The eastern region has a total storing capacity of 23.99 lakh tonnes while only 17.10 lakh tonnes of food grains are stored. Similarly in the western region only 32.29 lakh tonnes of food grains are stored against a capacity of 43.30 lakh tonnes.


The foregoing analysis clearly points to the poor quality of governance with regard to damaged food grains. Paradoxically, sufficient food stocks and unprecedented damage to food grains are taking place at a time when a sizeable proportion of the people of India go to bed without food. According to a UN report, around 60 per cent children in the country sleep hungry.


The Supreme Court took up the matter of overflowing of food grains in government godowns and misgovernance as early as 2001.The court in its order on August 20, 2001, stated that food grains, "which are overflowing in the storage, especially of FCI godowns, and which are in abundance should not be wasted by being dumped into sea or eaten up by rats. Mere schemes without implementation are of no use. What is important is that the food must reach the hungry".


The Supreme Court has again taken up the issues related to the storage and distribution of food grains among the poor during the hearing of a case filed by the People's Union for Civil Liberties. The court has passed the orders to distribute the food grains lying in government godowns free of cost to the poor. Not only this, the court has sought a clarification from the Central Government about supplying food grains to additional seven crore BPL families through the public distribution system (PDS).


Governance issues have again come to the fore in implementing the court orders. The government has not come out with any explicit public policy about who are eligible to get food either free as per the court order or at a nominal price as per the government's understanding. In this entire discourse poverty estimate methodologies and procedures have shadowed the real hardships the BPL families face day and night. The estimate of poverty varies from 27.5 per cent (Planning Commission) to over 70 per cent (Arjun Sengupta Commission). The National Advisory Council (NAC) has proposed food security for 75 per cent of the population. No doubt the universal food distribution is an ideal objective, but due to financial and administrative constraints adopting the NAC recommendation may make a good beginning.


To ensure that not a single grain is damaged and no poor person goes the bed with an empty stomach, accountability norms should be made more stringent in case of food grain procurement, storage and distribution. The loss/damage to food grains should be recovered from the erring officials.


Civil society organisations should be legally allowed to conduct an audit of food grain management. An independent regulatory commission should also be set up for monitoring the working of the government agencies involved in the food grain business.


The writer is a former Dean, Faculty of Arts, Panjab University, Chandigarh








THE problem facing the country today is not one of shortage of food grains but of managing the surplus. A combination of good monsoon years and higher procurement prices offered by the successive governments has filled the FCI godowns beyond the prescribed buffer stock norms. However, the availability of food grains is not sufficient to ensure food security to the poor. In spite of huge buffer stocks, one-third of the world's hungry are believed to live in this country. There are millions of rural and tribal people who have no sufficient means to purchase food. It is, therefore, necessary either to increase the income of the disadvantaged or provide them food at subsidised rates.


Targeted at the poor, the public distribution system (PDS) facilitates the supply of food at subsidised rates. However, doubts are often raised about the efficacy, cost-effectiveness and transparency of the system, especially when food gets rotten in godowns and the poor face starvation and malnutrition. Yet the PDS is a large network delivering wheat, rice, sugar and kerosene worth Rs 30,000 crore annually to about 160 million families through 4.76 lakh fair price shops across the country.


The National Advisory Council's move to make food a legal right of the people is undoubtedly a great step towards universalisation of food in India. However, food security will largely depend on reforming the PDS, maintaining the food grain production and creating a decentralised modern warehousing system.


Reforming the PDS is the most important challenge before the government, especially when food security is enlarged to provide 35 kg wheat or rice at Rs. 3 per kg per family to 75 per cent of the population. The India Human Development Survey, 2005, revealed that 31 per cent households in Chhattisgarh, 38 per cent in Jharkhand and 33 per cent in Bihar did not have cards corroborating the administrative callousness. Though income is the best basis for holding a BPL or Antyodaya card, there was a disturbing mismatch between income and the issue of BPL cards. The survey also revealed that of the BPL and Antyodaya cardholders only 55 per cent made any purchase of rice and 44 per cent any wheat. Hardly 13 per cent met their 100 per cent requirement of rice and 28 per cent of wheat from the PDS shops. Obviously, there is large-scale pilferage of food meant for the poor.


Meanwhile, the annual food subsidy bill for maintaining the system is rising, coming to more than Rs 17 per capita per month. More and more sociologists agree that programmes targeted mainly for the poor hardly benefit them because of poor participation. On the other hand, programmes like the Mid-day Meal and the Integrated Child Development Services enjoying wider public support are more successful. Preferences for goods and services provided by the private market can greatly influence benefits reaching the needy. Kerosene is still the most sought after commodity from the PDS shops as there is no difference between that purchased from the PDS shops or the market. Clearly, the quality of food supplied through PDS shops has to be improved if the programme has to be universalised. The identification of beneficiaries, defining their participatory role and maintaining an unbroken supply chain are the other critical factors for the PDS to be dependable.


It is time to bring in innovative technologies such as smart cards, food credit/debit cards, food stamps and decentralised procurement to make food available to the poor to eliminate hunger. In the rural areas community grain banks can be established from where the needy can borrow grains in times of need and repay in cash or kind once the crisis is over. To run the system smoothly there is need to exclude commodities other than rice, wheat or kerosene which the BPLs need most.


To make the delivery system transparent and trustworthy, the coupon system evolved by Andhra Pradesh can be followed. Under this system a card-holder is issued coupons denominated in smaller quantities like 5 or 10 kg once in a year, whereas the card-holder gets the ration in easy installments during the whole year. The coupon guarantees the stakeholder his right to draw a specific quantity of food grains every month. The introduction of coupon system has reduced the number of bogus cards as well saved huge amounts of subsidy. Only by improving the delivery, food security can be ensured.


The writer is an IFS officer. The views expressed are personal









This week we kick things off with a direct quote, from the occasionally great Aamir Khan: "Mujhe yeh darlagta hai ki Dhobi Ghaat shaayad audiences ko – matlab jo masses hai – unko pasand nahinaayegi. Kyonki yeh bahut hi fine film hai. Matlab jin logon ko cinema ki samajh hai, jo log sensitive hai,dil se jo jazbaati log hain, unke liye ye film hai." 


"I fear that maybe audiences – the masses – won't like Dhobi Ghaat. Because it's a very fine film. I mean people who have knowledge of cinema, who are sensitive, who think from the heart and are emotional, this film is for them." 


Really, Mr Khan? 

Do please put a sock in it, sir. 


Suddenly your new film is too good for your audience? And your audience, the reason you are who you are, perceived as cerebral even while hawking low-fat snacks, is suddenly not sensitive enough, not emotional enough – and not well enough versed in film theory – for you? Bah, humbug. 


The sheer level of condescension in that quote is alarming. For one, calling the Indian audience short of sensitivity or emotion is a stretch in any book. We've always been suckers for high drama, even in comic scenes. You know, the kind of films where vacuum cleaners birth infants just so caricatured fathers can have changes of heart? Yeah, those wouldn't work if the audience didn't react with its heart and forgive all the farce. 


Said at the Peepli Live DVD launch last week, the lines are also particularly jarring coming from Aamir, an actor whose biggest hits – Raja Hindustani, Fanaa, Ghajini – are widely considered the weakest of his films. Does it then imply that the perfectionist knows his audience so well that he confidently feeds them tripe? And in that vein, is it an admission, an inadvertently candid confession of mediocrity, saying that while the other films are 'simple' enough for masses to get, this one – produced by Aamir and directed by wife KiranRao, currently nabbing killer reviews on the festival circuit – is the sole exception? That Khan himself is frighteningly aware that everything else he serves up is not, um, 'fine'? 


And since when did you need to be cine-literate to appreciate a good film? A masterpiece is a masterpiece is a masterpiece, and hits you right between the eyes – and shoves you in the heart with the force of a roundhouse right – no matter what you know about the craft of cinema. A good film is a visceral experience, and you do not need to be aware of technique or predecessors to be overwhelmed by it. Sure, film theorists and critics and their mothers all have different ways of consuming a film, but a solid film – which could be personally smashing for any single one of us – doesn't need cinematic education to show off its chops. At all. 


Then again, as a friend suggests, perhaps this too is strategy on the part of the masterful marketing maestro. Berate the masses, and dare them to come see a film in defiance of the claim that they won't get it. For all you and I know – and Aamir's track record suggests he knows better than anyone else – it'll work, and Dhobi Ghaat will be an unquestioned success. Maybe just because of those reactionary words. 

Yet that isn't the point. As a member of your audience, Mr Khan, that quote just hurts. It is thoughtless, callous, dismissive and most uncalled for. Suggesting that you are smarter than the people who make you a star betrays a hint of smugness that, when heightened, invariably culminates in increasingly sloppy, manipulative cinema.

Coming from you, one we have tremendous expectations from, a barb like that stings and disappoints in equal measure. 


And a plea for sensitivity from the audience could certainly have used some of its own.



******************************************************************************************BUSINESS STANDARD





Ratan Tata is, without doubt, one of the most respected business leaders in India. When he says that he was advised to bribe a minister of the Union government a sum of Rs 15 crore to get governmental approval to start a private airline company, everyone concerned must sit up and take note. This is no casual remark. However, and very regretfully, this is no example of "whistle-blowing" either, as some in the media seem to think. It would have been if Mr Tata had named the minister and made public his demands at that time. Even now, Mr Tata is blowing no whistle, he is merely whining and seeking to occupy high moral ground. It would do him enormous credit, and boost the morale of smaller businessmen and ordinary citizens who face similar situations all the time, if he were to name and shame the minister concerned. Mr Tata also had a different kind of brush with a minister of the present government and on that occasion too, he chose not to go public with his complaint. If business leaders of the stature of Mr Tata are willing to strike but afraid to wound, what can one expect of lesser mortals? Far too many businessmen complain these days in private about corruption in public life, but shy away from naming and shaming. The same organisations that complain privately about rent-seeking by individual ministers seem quite happy to honour them in public in one way or another.


For every bribe taker, there is a bribe giver. The one who gives is also guilty of wrongdoing, though in the case of ordinary citizens facing people in power, one can understand their fear of authority. But an influential and powerful business leader can afford to speak up and speak out, and blow the whistle without fear or favour. If business leaders collectively take a decision that they will not offer bribes and that they will name and shame those who demand, this could have the effect of restraining both bribe takers and givers. Consider the example of private airlines brought up by Mr Tata. Naming and shaming at the right time may have helped prevent wrongdoing by a minister who may well have got away with benefiting some other business person at the expense of the exchequer. By remaining silent, Mr Tata has neither been brave nor has he served the cause of good governance. His tangential remarks this week, followed by clarifications, make him look smaller.


 Recent revelations of corruption, followed by some decisive action by Prime Minister Manmohan Singh, has whet the nation's appetite for greater transparency in government. A wave of middle-class anger is sweeping through the country. More heads may role as other instances of corruption in public life and in high places are exposed. The time has come for leaders of Indian business who believe in good governance to speak up and strengthen the hands of those in government who wish to take action but are unable to do so for want of information. The time for some genuine whistle-blowing is now and business leaders like Mr Tata must stand up and be counted.







Myanmar's great patriot and democracy activist Aung Sang Suu Kyi's latest bout of freedom — an event far more globally publicised than her previous releases — could provide the Manmohan Singh government with a unique opportunity to demonstrate the effectiveness of its "Look East" policy. The delicate balancing act South Block has played in realistically maintaining relations with Myanmar's China-leaning military junta and in securing Suu Kyi's release (the product of considerable, if unacknowledged, back-room activity) means India can transcend the standard, cliched appeals for democracy to establish itself as a constructive counterweight to China's aggressive expansion in the region. It is uncertain how much Dr Singh's unscripted lecture to General Than Shwe on democracy in 2004 influenced the Myanmarese dictator. But the truth is that, warts and all, India has demonstrated how political democracy and economic liberalisation can reduce poverty just as much as Myanmar's overweening state control of political and economic processes has demonstrated the opposite. Myanmar's deepening ties with China — now its largest trade partner — without any commensurate gains for its people, only highlight those weaknesses. In a sense, the objective conditions are set for India to play a bigger and more constructive role of political and economic "consultant", and broaden and deepen its sphere of influence in its eastern neighbourhood at a time when its north-western borders touch new levels of instability.


The fact is that natural resource-rich Myanmar is in dire straits after more than four decades of totalitarian rule. Its GDP growth limps along at a little under 2 per cent and more than a third of its population lives below the poverty line (the condition of the rest isn't much better), and it remains mostly a producer of commodities (petroleum products, gems) with little or no value addition. Ms Suu Kyi's political instincts are excellent, as the capture of 82 per cent of parliamentary seats by her National League for Democracy in the 1990 elections showed. The donation of her Nobel Peace Prize money for health and education trusts for the Myanmarese, and her many, real personal sacrifices have established a level of moral power that has obliged the junta to keep her alive (almost anywhere else, she would have been despatched in an "accident", "encounter" or straight assassination). But her economic agenda is less apparent. Through the years, she has repeatedly exhorted foreign investors to stay away and tourists not to visit Myanmar. When she meets foreign journalists in her simple but comfortable family home on Yangon's University Avenue, she talks eloquently about how a cup of tea in a five star hotel is equivalent to a policeman's monthly wages. But there is little in her speeches and utterances yet that suggests a coherent economic programme to put the Myanmarese people on a par with even the countries of the Asean club to which it gained admittance through the cynical calculations of regional geo-politics. For any peoples, political freedom without access to economic opportunity is a prescription for totalitarian rule. This time, though, Ms Suu Kyi has the opportunity to convert the politics of opposition into a concrete agenda for development — and India has a definite role to play in that conversion.








My recent swing through Singapore, Vietnam, Laos and Thailand coincided with President Obama's visit to Asia, including his successful visit to India. There was much scrutiny of every detail of the India visit and Obama's pronouncements. There was no doubt among these countries that the future trajectory of Indo-US relations would impact significantly on the prospects for both peace and prosperity in the Asia-Pacific region. President Obama's exhortation to India to move beyond Look East to Engage East, was echoed in virtually every Capital and a higher Indian economic and security profile was almost universally welcome. This is a strategic opportunity that India cannot afford to neglect.


In recent months, India has articulated a strategic doctrine of sorts for the Asia-Pacific region. This expresses a preference for open, inclusive and multipolar (read "balanced") arrangements for the region's evolving economic and security architectures. This is the reason for welcoming the expansion of the East Asia Summit to include both the US and Russia, and the setting up of the Asean plus eight Defence Ministers' Meeting as its symmetrical security counterpart. India has also categorically acknowledged that Asean must remain the nodal centre of this emerging architecture since it is the best platform for reconciling the differing interests of major players in the region. Finally, we consider that the different economic and security fora in the region, such as Asean-plus-one, Asean-plus-three and the East Asia Summit, are parallel processes without an inside track or an outside track. This rejects the notion favoured by China that the Asean-plus-three, the latter comprising China, ROK and Japan, forms some kind of an exclusivist "core" around which the new architecture should evolve.


 What should be heartening for India is the clear resonance of its approach in the Hanoi Declaration on the commemoration of the fifth anniversary of the East Asia Summit, adopted on October 28, 2010, which spoke of the need to establish an "open, inclusive and transparent, and outward-looking forum" in the region. And significantly, the Indo-US Joint Statement of November 8, 2010 declares, in similar terms, the commitment of the two countries "to work together and with others in the region for the evolution of an open, balanced and inclusive architecture in the region". This is a rare instance where India's strategic posture is aligned with almost all the major actors in the Asia-Pacific.


The Asean perspective towards recent developments in Asia-Pacific is a complex mix of attitudes, in particular towards China, not very different from our own. There is a recognition that the economic destiny of the region and its prosperity are dependent upon greater economic and trade engagement with a still rapidly growing China. At the same time, there is a fear of over-dependence on China and becoming its economic appendage. In this context, the only other rapidly growing continental size economy, India, is seen as a major partner providing the region some room for manoeuvre and possibilities for more diversified economic relationships. Singapore, for example, describes India and China as the two wings which will enable the Asean bird to soar towards higher levels of prosperity. Therefore, the importance of ensuring an economic architecture which permits increased engagement with both India and China as well as opportunities for more diversified economic relationships with all major economies.


On the security side, the situation is more complex and challenging. There is undoubtedly growing anxiety over the rapid augmentation of security assets by China, in particular its naval force projection capabilities and its recent assertive posture. There was a broad consensus that China seeks to achieve a level of dominance that would give it effective veto over the security decisions and choices of countries of the region. In response, these countries have adopted a number of coping measures. One, there is a significant, if not too visible, acquisition of enhanced military capabilities as an insurance policy. Two, there is encouragement of increased security cooperation both within Asean as well as externally with other friendly naval powers such as the US and India. The objective is not to form a containment ring around China but rather acquire levers to encourage China to become part of more balanced, diversified and loosely structured security arrangements in the region instead of pursuing unilateral dominance.


While there is fear of getting embroiled in an incipient Sino-US competition and rivalry for dominance in the region, India's growing profile is generally seen as benign. In fact, the sentiment in virtually all the countries I visited was that India was not doing enough to establish a much stronger presence in the region. However, this comes with a caveat: India should steer clear of becoming an instrument of US attempts to construct a reverse "string of pearls" around China, which would inevitably and adversely impact on the stability and economic welfare of the region. There is a fine dividing line which most of the countries draw between promoting balance without practising containment. This is not easy and the one policy can easily be misjudged for the other and often is. The only way such misjudgements can hopefully be avoided is through deeper and regular engagement among the countries concerned. On the one hand, there must be a firm rejection of unilateral assertions of the so-called "core interests" by any country which impinge on the vital interests of other countries in the region, in particular the freedom of navigation and the security of sea-lanes. On the other hand, the temptation to build exclusivist, countervailing security arrangements to cope with the emerging security challenge is fraught with risk. China shows a disturbing tendency to swing from arrogance of newly found power to a siege mentality rooted in its earlier history of weakness and humiliation. Neither should be encouraged. The Asean countries seem to understand this instinctively. So should India.


The author is a former foreign secretary and is currently acting chairperson, RIS and senior fellow, Centre for Policy Research








Congress spin doctors will claim it as the party's big blow to corruption. The resignation of Communications Minister A Raja on Sunday evening, they are claiming, will help the Congress party counter the charge that it has allowed unhindered growth of corruption in the government. However, a close look at the sequence of events that led to Mr Raja's resignation will show how hollow that claim is.


 Mr Raja's deeds as a controversial communications minister were out in the public domain for several months. The government was aware of them and so were the investigating agencies, the courts and the Comptroller and Auditor General (CAG) of India. Well before the report of the CAG that damned the role of Mr Raja was made public, its main findings were all over the print and electronic media. Indeed, Mr Raja had to resign under pressure from the Congress party even before the government tabled the CAG report in Parliament. Yet, as late as on Friday evening, Prime Minister Manmohan Singh was non-committal in response to questions on Mr Raja's future in the wake of corruption charges against him. "Parliament is in session. It is not proper for me to comment on a subject that is also probably in court," he said on board his special aircraft bringing him back from the G20 Summit in Seoul to New Delhi.


Why should the fact of an ongoing Parliament session constrain the prime minister from speaking out on the conduct of a member of his Cabinet? It is, therefore, reasonable to assume that Dr Singh was aware of the politics that was in play over Mr Raja. The Dravida Munnetra Kazhagam (DMK) had stood by Mr Raja and opposed any move to dismiss him from the Cabinet. Even Mr Raja thumped his chest and said there was no question of his resigning from the government.


A subsequent observation made by Dr Singh during his press conference on his return flight revealed it all. In response to a question relating to the reported offer made by Jayalalithaa of the All India Anna DMK to support the Congress-led United Progressive Alliance (UPA) at the Centre, Dr Singh said, "This is a subject I am hearing for the first time. This is for the Congress high command to take note of. I do not know what Dr Jayalalithaa has said. We are in alliance with the DMK and that alliance stands as of now."


Even Finance Minister Pranab Mukherjee remained non-committal on Mr Raja's future. On Sunday morning, Mr Mukherjee said, "Whatever has to be said, will be said in Parliament... Whatever needs to be said on Communications Minister A Raja will be said in Parliament."


By Sunday evening, the situation changed. The courtesy that the prime minister and the finance minister wanted to show to Parliament by not doing or saying anything about Mr Raja outside the legislature became irrelevant. On Sunday evening, Mr Raja submitted his resignation letter to the prime minister, which was duly publicised. So, what had actually changed? There could not have been any change in the assessment of the degree of corruption in this period. What may have changed was the equation between the Congress and the DMK. It was a tactical move in coalition politics, which had nothing to do with tackling corruption.


On Monday, when the Bharatiya Janata Party (BJP) demanded that the prime minister make a statement on Mr Raja's resignation, Congress leaders shot back saying if Atal Bihari Vajpayee did not make a statement in Parliament on the resignation of George Fernandes in the wake of the Tehelka controversy, why Manmohan Singh should do the same now.


The analogy was significant. The Vajpayee government too was an alliance and corruption charges took their toll on a member of an alliance partner. Once Mr Fernandes resigned, the corruption charges too faded into oblivion. Now that Mr Raja has quit, the Congress leadership seems to be arguing with the BJP, that these charges too should be allowed to meet the same fate. Remember that nothing has been done so far to fix the system.


Just as Mr Vajpayee faced problems in dealing with ministers belonging to non-BJP partners of the National Democratic Alliance (remember Jayalalithaa or Mamata Banerjee?), Dr Singh has similar problems with ministers belonging to non-Congress partners of the UPA. Indeed, corruption acquires a different connotation in a coalition government. This is what the Raja affair has brought to the fore so unequivocally.


Successive governments have failed to create a strong institutional system to prevent corruption, punish the guilty and make them an example so that others do not feel encouraged to indulge in corrupt practices. Coalition politics has made that resolve against corruption weaker. Political expediency of keeping a coalition government intact has encouraged political parties in power to become more accommodative of corruption.


Worse, the Congress party may even try to tell the people that it cannot punish the corrupt ministers belonging to smaller coalition partners because it does not have the required number of Lok Sabha seats to form a government on its own. That will be another politically expedient argument aimed at winning a few more votes in the next general elections. That would also be a perverse idea. There can be no compromise with corruption under any rule — be it a coalition or a single-party government.








Corporate entities, like deities, are legal persons for the purpose of Indian law. Both are powerful, but one distinguishing feature is that corporate bodies are not above rule of law and justice. Therefore, if they commit an offence, they can be prosecuted.


 Two essential ingredients of an offence are a guilty mind (mens rea) and a guilty act. But does a company or firm have a mind at all? It is only natural persons who can be said to have a mind. So some judges rule that it cannot commit an offence. It has no body; ergo, it cannot be imprisoned either. Mercifully, most corporations have deep pockets. Therefore, they can be fined, but within the limits of the colonial laws that were written in the days of annas.


The question of punishing a corporation came up recently in the Supreme Court in a criminal case filed by Iridium India Telecom Ltd against Motorola Incorporated. The allegations were cheating and criminal conspiracy. The magistrate in Pune started proceedings against Motorola. It moved the Bombay High Court against the prosecution. The high court quashed the proceedings giving several reasons, one of them being that a corporation was incapable of committing the offence of cheating as it has no mind. According to the high court, although a company can be a victim of deception, it cannot be the perpetrator of deception. Only a natural person is capable of having a guilty mind to commit an offence.


However, the Supreme Court set aside the high court's finding and asserted that a corporate body can be prosecuted for cheating and conspiracy under the Indian Penal Code. The offences for which companies can be criminally prosecuted are not limited only to the specific provisions made in the Income Tax Act, the Essential Commodities Act, and the Prevention of Food Adulteration Act. Several other statutes also make a company liable for prosecution, conviction and sentence.


The court allowed the prosecution to go on, stating that companies and corporate houses can no longer claim immunity from criminal prosecution on the ground that they are incapable of possessing the necessary mens rea for the commission of criminal offences. The legal position in England and the United States has now crystallised to leave no manner of doubt that a corporation would be liable for crimes of intent. This is the position all over the world where rule of law supreme.


The English law was set out in H L Bolton (Engg) Ltd vs T J Graham in the following words: "A company may in many ways be likened to a human body. They have a brain and a nerve centre which controls what they do. They also have hands which hold the tools and act in accordance with directions from the centre. Some of the people in the company are mere servants and agents who are nothing more than hands to do the work and cannot be said to represent the mind or will. Others are directors and managers who represent the directing mind and will of the company, and control what they do. The state of mind of these managers is the state of mind of the company and is treated by the law as such. So you will find that in cases where the law requires personal fault as a condition of liability, the fault of the manager will be the personal fault of the company."


The Indian courts have also followed the same principles. The leading judgment of recent times is in the case, Standard Chartered Bank vs Directorate of Enforcement. The Constitution bench of the Supreme Court stated in that decision that "there is no dispute that a company is liable to be prosecuted and punished for criminal offences. A corporation may be subject to indictment or other criminal process, although the criminal act is committed through its agents."


But since a corporate entity has no body like humans, it cannot be imprisoned in serious crimes. "We do not think that there is blanket immunity for any company from any prosecution for serious offences merely because the prosecution would ultimately entail a sentence of imprisonment. Corporate bodies undertake activities that affect the life, liberty and property of the citizens. The corporate vehicle now occupies such a large portion of the industrial, commercial and sociological sectors that amenability of the corporation to criminal law is essential for a peaceful society with a stable economy. There is no immunity to the companies from prosecution merely because the prosecution is in respect of offences for which the punishment prescribed is mandatory imprisonment and fine."


However, acts of individuals in a company are subject to criminal law and they can be sentenced to imprisonment for cheating, conspiracy and misappropriation. Such persons, who lack political clout, are seen suffering prosecution almost every day in a scam-ridden society.







Hemant Mishr

MD & Regional Head Global Markets, South Asia, Standard Chartered

If we pose the $75 billion inflows against a $50 billion CAD the surplus is easily manageable


The recent acknowledgement by the Seoul G20 communiqué that excessive capital flows might require the adoption of "macro-prudential measures" by some countries with "increasingly overvalued flexible exchange rates" is a significant development as the challenge faced by economies flooded with capital inflows has been finally recognised. This has renewed expectations of more regulations from the Asian economies. Already eight economies including China have imposed such regulations. And South Korea is widely expected to follow soon.


Surprisingly India has been an exception till now, despite $28.6 billion of flows from foreign institutional investors (FIIs) since July 2010. This has generated much discussion about whether such inflows are large enough to warrant controls as it has exceeded the overall amount recorded historically in such a short span of time. I think India is still far away from such a situation because things are playing differently and favourably for the economy this time.


To start with, the quarterly current account deficit (CAD) was only about $4 billion during the earlier boom period, versus $13-14 billion so far in FY11. This more than trebling of the CAD, along with a significant reduction in external commercial borrowings and foreign direct investment has created room to absorb more FII flows without adding substantially to the balance of payment (BoP) surplus. This is apparent if we do simple math. For example if we pose the $75 billion figure of capital flows against a $50 billion CAD (assuming the wide quarterly $13-14 billion CAD is replicated in the rest of the quarters which looks likely), the economy is left with a surplus of only $25 billion or 2 per cent of GDP. Apart from smoothing out lumpy capital flows, this surplus is easily manageable.


Thus, domestic policymakers' comfort with the current external situation is not surprising. In fact, early this week Deputy Chairman of the Planning Commission Montek Singh Ahluwalia said India can handle up to $75 billion of capital inflows easily without resorting to any controls. I agree with this stance as India's investment requirement remains huge and foreign funding is indispensable (according to 12th five year plan $ 1 trillion worth of investment is required during 2012-17).


In fact, even when capital flows surge (highly probable because economies like US have already embarked on another round of liquidity injection), India needs to design measures so as not to damage either the domestic economy or international investors' long-term image of the country. The questions that assume importance are: (i) how much is too much? and (ii) how should such flows be handled.


In my view capital flows of close to $100 billion or a BoP surplus of $50 billion (assuming the CAD remains wide at $50bn) can still be managed by a combination of rupee appreciation, foreign exchange intervention and sterilisation. Currency appreciation is one of the easiest ways to absorb such increases. Using the RBI's 36-country real effective exchange rate (REER) index as a proxy for valuation, it is hard to justify the argument that the rupee is overvalued any more. In addition, given higher inflation in FY11, the Reserve Bank of India (RBI) may have a higher tolerance for orderly currency appreciation. Tight liquidity in the domestic banking system (close to Rs 1 lakh crore) has left RBI with comfortable room to intervene in the foreign exchange market without fears of whipping up inflationary pressure via excess liquidity. However, if the need arises tools like sterilisation bond issues are also available.


Capital flows in excess of $100-120 billion, however, might force India to take stricter measures. This could include macro-prudential measures aimed at curbing asset prices, counter-cyclical fiscal policy or encouraging outflows to offset inflows. But, in isolation, these measures do not fully address the problem. And so attention turns to capital controls. In such a situation India needs to make clear that short-term inflows are not welcome. Controls can take many forms: unremunerated reserve requirements as implemented by Chile in 1991 or Thailand in 2006; time requirements, as in Malaysia in 1997; limits on the size of inflows, as in Taiwan in 2009; or a direct tax, as in Brazil recently.



A V Rajwade

Foreign exchange risk management consultant


We still look at the deficit from the angle of financeability, rather than its impact on output and jobs in the tradeables sector


Both the electronic and print media have headlined the comments of C Rangarajan, chairman, Prime Minister's Economic Advisory Council, and Montek Singh Ahluwalia, deputy chairman, Planning Commission, to the effect that (net) capital flows up to $70 billion to $75 billion in the current fiscal year should not pose a problem. After going through the reports on the subject, I feel that both of them expect the current account deficit to be $45 billion to $50 billion and that "(India) can also accommodate comfortably up to $20 billion as additional reserves" as Rangarajan has been reported saying. The actual net capital inflows in fiscal 2009-10 were of the order of $51.9 billion, and $17.5 billion in the first quarter of the current year. The largest single element in the capital inflows is of course portfolio investments, which exceed the net foreign direct investment, in both fiscal 2009-10 and Q1 of 2010-11.


For me, the positive aspect of Rangarajan's statement is that it seems to specifically envisage Reserve Bank of India (RBI) intervention in the market (to the extent of $20 billion, the capital inflows in excess of the expected current account deficit), something RBI has avoided for a long time, and that too on an unsterilised basis to "help ease the liquidity situation".


Looking at the issue with the current account deficit as a "given" is not a very logical proposition. In fact, lately, I find too many economists arguing that we need the capital inflows because we have a large and growing deficit on the current account: the deficit in the current year as a percentage of GDP (even as conventionally calculated) could exceed that of the far more publicised case of the United States. (Our gap between external income and expenditure, i.e. deficit net of inward remittances that are not the domestic economy's "earnings", is, in any case, far higher.) Sadly, while the US has at last recognised the link between the deficit on the one hand, and domestic output and jobs on the other, as manifested in the pressure on China to bring down its surplus, we still seem to be looking at the deficit more from the angle of its financeability, rather than its impact on output and jobs in the tradeables sector.


The fact is that capital inflows are not just a means of financing the deficit, or independent of it. In the absence of intervention by the central bank in the market, as has been the case in India for the last 20 months, the excess flows appreciate the exchange rate, which discourages exports and encourages imports by making the tradeables sector of the domestic economy less competitive in the global market, and thus are an indirect cause of the current account deficit and the consequential loss in domestic output and jobs. To be sure, in macroeconomic accounting terms, the deficit also represents the excess of domestic investments over domestic savings. Too many of us seem to believe that, in our present macroeconomic situation, the deficit is caused by our need for investments. There is, of course, an equally logical explanation that directly links the two ways of looking at the issue: an overvalued exchange rate can as well lead to lower savings, rather than larger investments, because of both less output and greater consumption of imported goods and services than what they would have been at a lower exchange rate. I personally am biased towards the latter argument.


In many ways, we seem to be an exception to how the rest of Asia is looking at the issue of capital inflows, particularly in the context of the quantitative easing proposed by the Federal Reserve. Despite many of them having surpluses on the current account, they are looking at reducing flows and/or otherwise sterilising their impact on the exchange rate and the domestic output; on the other hand, we seem to be glorying in the American pat on our back for our exchange rate policy, the current account deficit — and for creating jobs in the US. One danger signal is that the market fundamentalist editorial pages of The Wall Street Journal (November 11, 2010) have started praising our policies!








THE reported travails of the largest life insurance company, the public sector Life Insurance Corporation of India (LIC), illustrate, once again, the perils of assured-returns schemes. Whether in the context of the infamous Unit-64 scheme of the Unit Trust of India or the assuredreturns schemes of LIC where the corporation guaranteed a pre-specified return, the crux of the problem is the same: the inability to honour a commitment to make a stream of payouts at a pre-determined rate in an uncertain world where the returns on funds invested may go up or down. In the case of the LIC's three assured-returns schemes of 1980s and 1990s vintage, Jeevan Suraksha, Jeevan Dhara and Jeevan Akshay, which were launched when interest rates were high, it is inevitable, perhaps, that the sharp decline in interest rates in the last few years coupled with increased longevity of Indians should leave these schemes with a deficit as on date. An actuarial valuation of LIC's commitments under these schemes is bound to show them in the red. Given the corporation's quasi-sovereign status, it can hardly refuse to honour its commitments. As per norms, LIC cannot shift returns from one class of schemes to another, limiting the scope for cross-subsidy. What this means, in effect, is that the government will have to ride to its rescue. 


Having said that, there is no need to panic. Though the sum involved seems large at the moment, the quantum of 'loss' is not cast in stone. As with the UTI where the government finally reaped a windfall from its investment in SUUTI — the Specified Undertaking of the UTI — it is possible the final loss will be less than what it appears to be now. What is more important is that we learn the right lessons and eschew assured-returns schemes. LIC, for one, seems to have understood: the share of such schemes in its overall portfolio has come down over the years. However, the same cannot be said of the insurance sector regulator, Irda. Its recent guidelines on pension products where it has mandated that insurance companies must offer a 4.5% assured return defy comprehension. To be sure, 4.5% seems a very humble return at the moment. But ask the Japanese: they've been stuck with interest rates at near zero for close to a decade!







MR RATAN Tata did not exactly offer a blinding new insight when he talked of political power being used to collect rent or offer patronage. But the fact that he chose to bring up the subject in the aftermath of the recent, royal exit from the telecom ministry is significant. Business as a whole suffers as a result of corrupt politics, which stunts economic growth. The lesson from India's low rank in the World Bank's Ease of Doing Business listing of countries is no different. The point is, what can be done about it? It is not enough to blame politics and the politicians. So many politicians have prospered into masters of illicit empires that it is difficult to expect politicians to reform, of their own initiative, the way politics is carried out, particularly how it is funded. The initiative has to come from industry. If they collectively decide to turn off the tap and fund political parties only through transparent, fully accounted-for and audited ways, that would prepare the ground for sweeping change. Right now, the absence of institutional funding of politics offers justification for individual politicians to collect money, of course, 'for the party'. Money is collected by sale of patronage, extortion and loot of the exchequer. This cannot be done without the collusion of the bureaucracy. Once they are suborned, the scope of corruption spreads, the number of palms to be greased multiplies and the institutional integrity crumbles. Business and economic growth suffer, in consequence. This has to change. 


Every country goes through this stage and must struggle its way out of the morass. The countless billions tucked away in tax havens around the world stand testimony to the enduring power of corruption even in countries where it does not impact everyday life for business or the common man. But it can be contained. India, too, must find the will to evolve along this path. Billionaires have taken to politics in India of late. But politicians haven't yet stopped morphing into billionaires. For that reform, the lead has to come from industry, which releases the stream of funds that feeds into the cesspool of corruption.








NOT a day goes by without the TV news channels changing the initial A in the country's just-resigned telecom minister's name. In the wake of the reported mother of all scams on the sale of 2G spectrum — estimated by the CAG at . 1,76,000 crore — the initial A (for Andimuthu) in the erstwhile minister's name has been systematically changed to suit the daily headline on TV networks. He is called Spectrum Raja by one TV channel, Telecom Raja by another, and Scam Raja by a third. These nicknames need not be due to a regional bias even if Raja represents the Nilgiris parliamentary constituency down south and far away from the central news desks of national TV networks. Take, for instance, T Raja who is popularly known as Auto Raja in India's Silicon Valley because he uses his autorickshaw to pick up the destitute and care for them. And then there is the conscientious car mechanic played by Kamal Haasan in the 1989 Tamil movie Apoorva Sagothargal (Strange Friends), which has a song that goes, Raja kaiya vecha / Wronga ponadhillai (Once Raja puts his hand to it / Nothing goes wrong). 


However, it is not as if the surname Raja only has notorious associations insofar as real-life politicians go. The poorest MP in the Rajya Sabha is Doraiswamy Raja who hails from a family of landless farm labourers and was the first BSc (in mathematics) in his village. D Raja, national secretary of the CPI, has only one other thing in common with the erstwhile telecom minister, apart from the surname and the fact that they are both MPs from Tamil Nadu: both the Rajas have mobiles. However, search the net for D Raja and you will find that the country's poorest MP does not hide his mobile number. Which still hasn't stopped BJP spokesperson Ravi Shankar Prasad from sometimes inadvertently referring to the erstwhile telecom minister as D Raja, even if he apologises for the error later!






THE jury is still out whether the Doha Round of the WTO is a development round or not, observed the Brazilian and US ambassadors at a recent workshop on the Doha Round of trade negotiations held in Geneva on November 2. At the concluding session moderated by WTO director-general Pascal Lamy, ambassadors from China, India and EU asserted that this is a development round. It was a candid assessment of the geopolitics of the trade and reflected the grim scenario that countries continue to speak to each other, with each looking in different directions. But, the workshop was not only about geopolitics; it was also about numbers. Many analysts opined that up to $200 billion could be added to global welfare by the current package of offers. More importantly, they contended that the world could see a 10% contraction in trade if the Doha Round fails. 


Jayant Dasgupta, the Indian ambassador, succinctly summarised the discussions by reminding the meeting of the old metaphor that it is time to enter a period of give-and-take negotiations and that it is no longer feasible to raise ambitions. This author was speaking at the workshop on rules and environment, not too easy but certainly, no hurdles in sewing up the Doha Round. 


India has been playing a leading role in the Doha Round negotiations. Indian commerce minister Anand Sharma was recently at Geneva to test the waters and reaffirm India's willingness to negotiate. India has not only been a part of the complex variable geometry of delegations meeting to thrash out differences and pull the negotiations out of its decade-old quagmire, but it also has taken a lead to pull them along when required. 


India has contributed to the emergence of credible draft chair texts on agriculture and non-agriculture market access negotiations that led to the last two most hope-generating efforts in July and December 2008. The efforts failed, though Lamy gives it 80% marks. In the fall of 2009, when appetite for a trade liberalisation deal was minimal in the wake of the financial crisis, India hosted a mini-ministerial where Lamy unveiled a road map for intense negotiations with capital-based senior negotiators. That effort, too, fizzled out by the next spring, and the focus of Genevabased delegations shifted to more procedural and practical matters like the templates for making commitments, collection of data to determine base years and so on. In the meanwhile, political leaders continued to meet on the margins of various occasions, with this November seeing the Apec meeting in Yokohama that followed the G-20 meeting in Seoul. Another spring is coming, yet no deal appears on the horizon. 


In this pessimistic scenario, what can India do? As an engaged trading partner, it can reassess its offers for others to emulate. The critical decision area that needs attention is the 'modalities' on agriculture and non-agriculture market access (Nama): involving reduction of tariffs on agriculture products; elimination of export subsidies and reduction of domestic subsidies; and reduction of tariff and non-tariff barriers on industrial products. 


In Nama, the discussions focus on three issues — 'coefficients' for tariff reduction, the anti-concentration clause and 'sectorals'. On the first two, while India may not accept blanket restriction on flexibility built into the December 2008 texts, it is not likely to block a deal. The issue of sectorals, where members may agree to undertake deeper tariff reduction commitments in selected sectors, is more sensitive. India has not shown any aversion to engage on the issue in its effort to get a deal through. 


DURING the last couple of rounds of talks, India has come out with more substantive economic arguments on the difficulties in sectors of interest to others and submitting joint proposals in sectors like chemicals. These contributions should enable its trading partners to make a balanced assessment of how far to push India. India has also been at the forefront of developing a mechanism to address non-tariff barriers, a joint proposal on which was discussed at length in the last round of negotiations in October. 


Agriculture negotiations are more important for India, with two-thirds of its population dependent on subsistence farming. Although a number of issues appear to be far from settled in these negotiations — like cuts in overall trade distorting support, percentage of products to be declared as sensitive and the connected issue of tariff rate quota expansion, tariff capping and special products — the critical issue that calls for innovative handling is the proposed special safeguards mechanism (SSM) for developing countries. The SSM would enable developing countries like India to take remedial action through higher tariffs in case of import surges or import-induced price declines. The main differences are between India and the US about the extent of increase in import volume (i.e., the volume trigger) required to cross the Uruguay Round (UR)-bound levels of tariffs and the extent to which these tariffs could be exceeded. Rather than try and reach a compromise, the waters are being muddied by some newly proposed instruments. However, the feeling is that India will agree on a new trigger benchmark, and the US should show flexibility on these new issues as well. 


The state of negotiations is unclear at present. The technical work in various committees appears to have moved forward, with the task on scheduling having progressed in parallel to the deliberations about commitments. Given the broad support to calibrated liberalisation accompanied by regulatory and institutional flanking policies among our political establishment, India will not be the deal-breaker. It will continue to sit on the high table as a deal-maker rather than a deal-breaker so long as its farm sector is protected, no commitment of a zero-for-zero in industrial goods sector is insisted upon, commercially meaningful liberalisation is secured in services and a commitment to accommodate the UN Convention on Biodiversity in TRIPs is agreed to. 

    (With inputs from Atul Kaushik 

    of CUTS, Geneva) 

    (The author is secretary-general, 


    CUTS International)







Former Foreign Secretary 


We should not spurn a friendly military regime 

IT IS neither practical nor wise to base foreign policy on abstract principles or ill-defined political morality. Myanmar, as our direct neighbour, compels engagement. It is contiguous to our insurgency-affected north-eastern states, for handling which we need its cooperation. Myanmar will be our gateway to South-east Asia when we complete our multi-modal transport projects there. Myanmar is indispensable for promoting the economic development of our north-east through sub-regional cooperation.


China made major inroads into Myanmar during the period India rejected the military junta. Myanmar potentially provides it access to the Bay of Bengal, besides port facilities to support increased Chinese naval presence in the Indian Ocean. While China's effort is to develop north-south connectivity with Myanmar to anchor it more firmly into its sphere of influence, our interest is to make Myanmar a key link in east-west connectivity, and anchor it in an extended Southern Asian space, both Saarc and Bimstec, a grouping of South and Southeast Asian countries. 


Should we sacrifice our national interest in Myanmar solely because its regime is antidemocratic? If ties with countries depended on their democratic credentials, we should be having frosty relations with most, as the majority of them are not democratic. With what justification would we pursue our national interest in China, Vietnam and most of the Arab world and Africa? Around us, we have dealt with whichever government has been in power. If we could deal with hostile or unfriendly military regimes in Pakistan and Bangladesh, then what principle dictates that we spurn a military regime in Myanmar friendly to us? Have we ever made the spread of democracy a declared principle of our foreign policy? Should we join those who crusade for democracy in the world selectively? President Obama's finger-pointing at India on our Myanmar policy on the floor of the Indian Parliament was regrettable. Why can the US arm Pakistan's military regimes, but India must not do business with the Myanmar junta?



Human Rights Activist 

Democratic values should dictate our policy 


DISCARDING the democratic verdict of the Burmese people in the 1990 elections, the military junta had arrested Aung San Suu Kyi and hundreds of her supporters, letting loose a reign of terror that forced more than a million people to seek refuge in India and elsewhere. An estimated 50,000 refugees from Myanmar reside in India, treated as illegal immigrants, often jailed under the Foreigners Act and periodically pushed back across the borders into the hands of the Myanmar army. 


The Indian government did not formally award the Nehru Peace Prize to Suu Kyi to appease the junta. The refugee camps set up in Mizoram were closed under pressure from Myanmar. As a quid pro quo, Myanmar offered to crack down on India's north-east insurgents. Distancing itself from the policy of 'sanctions', India opted for "constructive engagement", anxious to balance China's rapidly increasing influence in Myanmar. India has sacrificed its commitment to democratic values, rule of law and respect for human rights in the interest of securing its security. It begs the larger question: is India likely to be more secure by having an autocratic, military-ruled Myanmar? To seek to emulate China in Myanmar, and in our neighbourhood as awhole, dangerously overlooks that what India has achieved is not in spite of its tumultuous democracy, but because of its democratic culture and values. Should we sacrifice our core values? 


The EU has positioned itself as a "soft power" and is consolidating itself as an economic powerhouse. The EU is proud of its democracy. It is following a policy of engaging with China without abandoning its commitment to democracy and human rights. The enlightened national interest of India requires that we do not support undemocratic regimes in our neighbourhood. The release of Suu Kyi is welcomed as a possible opportunity, and India should step forward to strengthen that opportunity by speaking up for democratic values. 


That is also the path for strengthening Indian democracy at home. 

(The author is also a documentary filmmaker)








WHAT makes politics truly fascinating is not just its numerous plots, sub-plots and dramatis personae but also those comical twists that come uninvited to steal the thunder from the main act. Thus, former RSS Sarsanghachalak K S Sudarshan single-handedly muddies the BJP's political plot just when it readies itself, rightly, to carpet-bomb the Congress and the UPA over high-profile corruption. The fact the BJP and RSS had to quickly apologise for the Sudarshan rant showed not only how desperate the saffron front was to wriggle out of the mess created by an insider, but also the essential contradiction between the BJP's aspiration to be the democratic alternative to the Congress and the sinister organisation that serves as its ideological fountainhead, cultural mentor and political guide. 


Sudarshan's hysterical attack on Sonia Gandhi, accusing her of being a CIA agent who had plotted the assassination of Indira Gandhi and Rajiv Gandhi, had, expectedly, triggered a nationwide protest. But, then, those who are familiar with the cultural tastes and modus operandi of Sudarshan fans know only too well such talk is par for the course for this tribe that habitually circulates whispered calumny as a trained method of misinformation and character assassination of their rivals. It was for that very reason legendary Congress spokesperson, the late V N Gadgil, used to describe the RSS as "Rumour Spreading Society". 


It is easy to dismiss Sudarshan, as many embarrassed BJP leaders do in private, as a silly has-been who deserves no serious attention. But, the problem lies in the fact that such a person could rise, through the ranks and over the years, to become the topmost leader of RSS that both controls Sangh Parivar outfits like the BJP, VHP, Bajrang Dal, ABVP, etc, and moulds the characters and vision of its leaders! It says something about the basic character of the Parivar. The many recent utterings of Nitin Gadkari, the BJP president hand-picked by the RSS, too, have given an intriguing peek into the kind of political and cerebral faculty favoured by the Sangh. The most successful BJP leader of the time, Gujarat chief minister Narendra Modi, the darling of VHP, Pravin Togadia and the rising BJP star, Varun Gandhi, too, periodically display a penchant for divisive and freakish rhetoric that earns them compliments from the Sangh leadership, making it clear where the premium lies. 


It is important to note that while BJP leaders tried to distance themselves from Sudarshan's comments, none dared to either analyse the reasons that had made the 'higly revered' former chief's mindset what it is, or, call upon the RSS to reform its mindset, or at least, assert the imperative for the BJP to try and break off from such a backward, if not medieval, yoke that repeatedly pushes the principal opposition party into a tight political corner, besides limiting its ability to get connected with the growing, young and forward-looking India (not to be confused with a rabid section of netizens') which Rahul Gandhi is consciously tapping into without credible resistance. BJP leaders know too well that de-linking or liberating themselves and their party from the RSS can, at best, be pretentious intellectual posturing. Because, even those very few BJP leaders who project themselves as RSS-resenting party moderates', are the same who leave no stone unturned to cosy up to the very RSS establishment, hoping for the Sangh's backing for a coveted office. 


If the RSS, by getting Gadkari para-dropped as BJP chief, showed to all that its wish is the saffron party's command, the ambitious line of BJP leaders, by clinically executing the RSS sack order against their mentor L K Advani for his historically correct interpretation of Jinnah's speech, showed they are willing hitmen of their real masters. Even A B Vajpayee owed his rise to the sponsorship of the RSS, which hand-picked him to fill the vacuum created by the mysterious death of Deendayal Upadhyay. Though his powerful position as prime minister allowed Vajpayee the cushion to display some token resistance against the RSS, he was 'practical enough' to routinely describe himself as a 'swayam sevak', invite RSS brass to 7, Race Course Road and yield to their main demands like shielding Narendra Modi after the Gujarat riots. 


The RSS grip on the BJP is not surprising, given the very foundation of party's political/ideological platform is erected on the Parivar's hate campaign against minorities and its version of the two-nation theory. RSS shakhas and other Sangh outfits provide the BJP with its core constituency that no party leader can afford to ignore. But, the growing hiatus between the RSS's shadowy world and mainstream India mirrors the BJP's inbuilt crisis of credibility: the Hindumajority, pluralist India accepts a 'foreignorigin' and 'dynastic' Sonia Gandhi, who openly proclaims her status as a practising politician and subjects herself and her party to the nation's democratic scrutiny, over Sudarshan and his RSS that hide in a 'cultural bunker' to politically remote-control the aspiring alternative to Congress.


What the Sudarshan contretemps reveals is the contradiction between the BJP's ideology and its democratic aspirations 

RSS' grip on the BJP is not surprising, given its total adherence to the Sangh While Sonia Gandhi and the Congress subject themselves to democratic scrutiny, the RSS remote-controls BJP from its 'cultural' bunker








WITH persistence, one can cut the hardest rock with the softest rope," says a verse attributed to the medieval mystic-poet Kabir. "With practice (abhyasa) the heaviest brain likewise becomes super brilliant (jadamati hota sujan)." 


This secret of enlightened practice or abhyasahas also been extolled in the Bhagavad Gita and in Hathayoga: Abhyasa is infact a synonym for yogic practice in Indic tradition. Patanjali's Yoga Sutra defines 'stable practice' as that sustained over a prolonged period; that which is pursued without a break, with devotion and consistent right action, leads to a stable grounding or solid foundation (dridha-bhumih) for tranquil achievement, the Sage says. 


His definition implies that with right practice, every humble Joe can hope to reach the highest goal of self-realisation. This fits with the philosophical assertion made by Vedanta and other systems such as Kashmir Shaivism that everybody is innately divine. But awakening that divinity within is not just a matter of right practice but of grace or anugrahaas well. 


In his best-selling book The Talent Code, the New York-based writer Daniel Coyle has a name for places where practice makes perfect: he calls them 'chickenwire Harvards'. When we see people practise effectively, we usually describe it with words like 'willpower' or 'concentration' or 'focus'," he explains. 


But these words don't fit, he cautions, because deep practice is built on a paradox: where people struggle in certain targeted ways, operating at the very edge of their ability, for example, which in turn makes them smarter. This may explain why Coyle starts his first chapter with a German proverb that says, "You will become cleverer through your mistakes". 


That is also not to say that deep practice is a piece of cake. It does require energy, passion and commitment. This is the hidden part of yogic abhyasa, what Swami Svatvarama's classic Hathayogapradipika variously calls enthusiasm (utsaha) and lustre (tejas) of practice coupled with daring and faith. 


So, while deep practice is a conscious act, its ignition occurs in a hot, mysterious burst and awakening of lightening flashes of image and emotion. "Where deep practice is all about staggering-baby steps," Coyle elaborates, "ignition is about the set of signals and subconscious forces that lead us to say 'that is who I want to be'."



                                                                                                               DECCAN CHRONICAL




It is not every day that the leader of the country's most reputable industrial house goes public — as Ratan Tata did on Monday — to say that over a decade ago he couldn't start a new aviation enterprise as he refused to pay a bribe of `15 crores, and his speaking to three successive Prime Ministers (H.D. Deve Gowda, Inder K. Gujral and Atal Behari Vajpayee) was of no avail. This at once points to the depth of the crisis we face as a society and a nation, and to the inherent difficulties in eradicating the scourge of corruption which is eating into the vitals of our public life, in the process marring national progress and the prospect of helping those at the bottom of the heap to surmount poverty. Mr Tata's revelation, of course, points to a malaise that we are only too familiar with. The theoretical proposition is accepted that systemic corruption — when national institutions of every kind are in the grip of malfeasance — is a characteristic of developing or underdeveloped societies. The point, however, is that a developing country that resolves to forge ahead must find ways to reduce the systemic corruption that chokes it at every step, and one day to eliminate it in the not too distant future. Only then can we be assured that we have transcended the ranks of developing states. This is not to say that developed countries are strangers to corruption. But in those territories the malaise is not systemic and therefore easier to deal with. If the problem lies at the root and has spread like a blood infection to every artery, then we may be certain that nothing but the most drastic action to eradicate it will do. It is no one's case that this cannot be done, although it is clear enough that it will take a lot of doing. If the political leadership appears determined — as we have lately seen in the case of the Adarsh Housing Society scandal, the Commonwealth Games scam and the allegations concerning 2G spectrum allotment — a beginning can be made. But we should not pat ourselves on the back too early in the day, although it is an encouraging sign that key officials associated with CWG have now been arrested. As we go along, we may just discover that vested interests will do what they can to thwart meaningful investigations. It is important for the political leadership to stay the course. Other than expressing moral indignation, which we should not cease to do, official procedures require to be seriously modified so that the environment that breeds some of the corruption can be altered. In his early days as Prime Minister during UPA-1, Prime Minister Manmohan Singh gave the impression of launching on such a course, but he appears to have got distracted from that objective. As the size and power of India's economy grows, and we are able to rise from being a shortage economy — where demand outstrips supply and the system turns into a breeding ground of corruption — we may find we are beginning to beat the scourge. But there is nothing automatic about the process. The political leadership at all levels needs to be relentless in its pursuit of the goal for cleanliness in public life.

Corruption in the various branches, such as the bureaucracy or the police, is likely to be greatly reduced if the political bosses — irrespective of their party colour — crack the whip. For this to happen, the party system must rise to the occasion. It must nominate only clean individuals with a transparent record of public service for elections. Only then will legislatures and governments begin to look purpose-oriented and taint-free.








IF INDIA has been jubilant over US President Barack Obama's visit, an important reason is his virtually unqualified endorsement of Indian quest for a permanent seat on the UN Security Council that is a departure from the previous American position. A typical reaction to it in the world media was that the US president had given a "push" to India's "ambition". How long will it take for the ambition to be fulfilled is the question, and on this opinions vary widely.


Many in India's foreign policy establishment think that this could take as long as a decade. Some others have gone so far as to declare that Mr Obama's promise of a permanent seat was a "pie in the sky". Most American sources also believe that it would take quite some time before the package of the Security Council reform and the composition of its enlarged membership can be wrapped up. Of some interest is the estimate of a distinguished Chinese academic, Shen Dingli of the Fudan University. Unlike the government of his country that continues to be ambiguous, he supports India's claim to a seat around the horseshoe table at Turtle Bay in New York categorically. Yet he believes that it has taken 15 years to reach so far, and that another 15 years might be needed before the exercise of reforming global governance could be completed.


In view of all this it is all the more remarkable that the mood about the expansion of the Security Council at the most important venue, the UN itself, is vastly more upbeat, as I witnessed during three working days there last week. One telling phrase I heard at almost every step was: "This is an idea whose time has come and there is overwhelming support for the expansion of both the permanent and non-permanent membership of the Council". Some sources said that in December 2009, ambassadors (technically, they are called Permanent Representatives) of 144 countries had signed a letter demanding that the facilitator should prepare a text for inter-governmental negotiations instead of spending time in informal "discussions" in an open-ended working group. The number 144 far exceeds the two-thirds majority of the General Assembly which is needed to amend the UN Charter.


The Security Council per se has no say in this matter though by virtue of their clout the five permanent members can and will influence the voting pattern. Even today the clout of the US remains unmatched, as became evident last week. America succeeded in blocking the election of Iran to the executive of the women's committee of Economic and Social Council (Ecosoc). Iran got only 19 of 54 votes, while East Timor, a last-minute US-backed candidate, secured 36. India was elected by 52 votes.


To be sure, even the optimists about an early reform and expansion of the Security Council readily admit that a great many rival, sometimes overlapping, sometimes clashing claims of different groups have to be reconciled before an agreed resolution can be tabled and passed. For, different groups and countries have different demands of their own. For instance, the Africa Group, consisting of 53 member states from that continent wants two permanent and two non-permanent seats on the expanded council. This is a legitimate aspiration though the North African states do not want to be left out. The so-called "L-69" Group, so named after the number of a relevant resolution, with 44 members, is broadly in favour of early reforms subject to its interests being protected. Similar is the stand of small island states. The Coffee Club, claiming a maximum membership of 10 but never able to mobilise that number, consists of those who want to keep some other country out, such as Pakistan that constantly trains its guns on India, Argentina that wants Brazil out, South Korea strongly opposed to Japan and so on. The main motive behind the campaign for early reforms is G4, comprising India, Brazil, Japan and Germany.


Despite the enormity of the task, the predominant view among the movers and shakers at the UN headquarters is that the necessary consensus need not take one or two years because everyone is slowly realising what is possible and what is not. For instance, an unwieldy council would not be acceptable. Therefore, the optimum size could be in the mid-20s, in place of 15 at present. Non-permanent new members would have to exceed new permanent ones. The red-herrings across the trail suggesting undefined "interim" or "intermediate" models of change make no sense.


The other issues on which a consensus has yet to be evolved can be summed up briefly even though these cover 80 pages compiled by the facilitator, Ambassador Tanin. Veto is at the top of them. The Africa group persists in its demand that all new permanent members should have the veto exactly as the present P-5 do. But opinion seems to be veering round the G4 view that all permanent members should indeed have the veto right but in their case it should be put into operation after 15 years when the whole issue is reviewed.


Even today veto is used rarely; by then it might become irrelevant. Moreover, the working methods of the Security Council would have to be improved so that it does not encroach on the functions of the General Assembly. Finally, there should be regional balance but permanent members from each region should be selected on the basis of the criterion already mentioned in the UN Charter.


As for India's permanent membership, it has full support of four of the P-5. The only exception, China, "understands" but does not yet support India's interest in a more active role at the UN. But indications in both Delhi and New York are that Beijing would not oppose India's presence at the UN top table. Japan's entry into the fray could be a problem because the US would back it to the hilt while China would do all it can to exclude Japan. However, there is no need for India to get involved in this conflict. Finally, the US support is accompanied by the demand that India must act on Burma and Iran according to America's wishes. New Delhi's inability to do so must be conveyed courteously to Washington.









Many of the psychologists, artists and moral philosophers I know are liberal, so it seems strange that American liberalism should adopt an economic philosophy that excludes psychology, emotion and morality.


Yet that is what has happened. The economic approach embraced by the most prominent liberals over the past few years is mostly mechanical. The economy is treated like a big machine; the people in it like rational, utility-maximising cogs. The performance of the economic machine can be predicted with quantitative macroeconomic models.


These models can be used to make highly specific projections. If the government borrows $1 and then spends it, it will produce $1.50 worth of economic activity. If the government spends $800 billion on a stimulus package, that will produce 3.5 million in new jobs.


Everything is rigorous. Everything is science.


Conservatives, who are usually stereotyped as narrow-eyed business-school types, have gone all Oprah-esque in trying to argue against these liberals. If the government borrows trillions of dollars, this will increase public anxiety and uncertainty, the conservatives worry. The liberal technicians brush aside this soft-headed mush. These psychological concerns are mythological, they say. That's gaseous blathering from those who lack quantitative rigour.


Other people get moralistic. This country is already too profligate, they cry. It already shops too much and borrows too much. How can we solve our problems by borrowing and spending more?


The liberal technicians brush this away, too. Economics is a rational activity detached from morality. Hardheaded policymakers have to have the courage to flout conventional morality — to borrow even when the country is sick of borrowing.


The liberal technicians have an impressive certainty about them. They have amputated those things that can't be contained in models, like emotional contagions, cultural particularities and webs of relationships. As a result, everything is explainable and predictable. They can stand on the platform of science and dismiss the poor souls down below.


Yet over the past 21 months, it has been harder to groove to their certainty. To start with, the economy has not responded as the modellers projected, either in the months after the stimulus was passed or this summer, when it was supposed to be producing hundreds of thousands of jobs. It has become harder to define how much good the stimulus package is doing. An $800 billion measure must leave a large footprint, but it is hard to find in a $70 trillion global economy.


Moreover, it has been harder to accept that psychological factors like uncertainty and anxiety really are a mirage. The first time a business leader tells you she is holding off on investing because she is scared about the future, you dismiss it as anecdote. But over the past few years, I've had hundreds of such conversations.


It's been harder to dismiss morality as a phantom concern, too. Maybe in a nation of robots the government can run a policy that offends the morality of the citizenry, but not in a nation of human beings, as the recent elections showed.


Nor has the world come to look simpler and easier to manipulate since the stimulus passed. It now looks more complicated. It's one thing to hatch an ideal policy in an academic lab, but in the real world, context is everything.


Ethan Ilzetzki of the London School of Economics and Enrique G. Mendoza and Carlos A. Vegh of the University of Maryland examined stimulus efforts in 44 countries. In a recent National Bureau of Economic Research paper, they argued that fiscal stimulus can be quite effective in low-debt countries with fixed exchange rates and closed economies.


Stimulus measures are generally not as effective, on the other hand, in countries like the US with high debt and floating exchange rates. The authors of the paper pointed to a series of specific circumstances that complicate, to say the least, the effectiveness of increasing public spending: How much stimulus money ends up flowing abroad? What is the relationship between fiscal policy and monetary policy? How do investors respond to fear of future interest rate increases?


One could go on. It's become harder to have confidence that legislators can successfully enact the brilliant policies that liberal technicians come up with. Far from entering the age of macroeconomic mastery and social science triumph, we seem to be entering an age in which statecraft is, once again, an art, not a science. When you look around the world at the countries that have come through the recession best, it's not the countries with the brilliant and aggressive stimulus models. It's the ones like Germany that had the best economic fundamentals beforehand.


It all makes one doubt the wizardry of the economic surgeons and appreciate the old wisdom of common sense: simple regulations, low debt, high savings, hard work, few distortions.


You don't have to be a genius to come up with an economic policy like that.









On November 7, the Burmese people voted for the first time after more than two decades, both for the People's Parliament and the Nationalities Parliament. While the much-touted elections and the run up to it were critical, the actual event was marred by rigging and intimidation. Voter turnout in a country that has not seen an election in two decades was low, revealing that people had very little hope of things changing. The last elections held in Burma were in 1990 when the National League for Democracy (NLD), led by Aung San Suu Kyi, won a landslide victory. The ruling military junta, however, did not transfer power to the NLD and kept Ms Suu Kyi under house arrest for almost 14 years.


The two parties that were the forerunners in the 1990 election — the NLD and the Shan National League for Democracy — were both dissolved prior to the November 7 elections. Both chose to remain outside the rhetoric created by the State Peace and Development Council (SPDC), which is the official name of the junta. Thirty-seven political parties participated in the elections, though the NLD was probably most qualified in terms of political acumen and leadership.


One deterrent for several smaller parties participating in the elections was the high cost of registering candidates. The alliance of six small pro-democracy parties, called the National Democratic Force, was also ineffective because it was loose-knit and did not define itself coherently in terms of its mandate. Another factor was that it lacked able leadership.


Two of the most significant parties participating in the elections were the Union Solidarity and Development Party (USDP), which had its origins in the Union Solidarity and Development Association (USDA), a closely knit association of the ruling military officials. The USDA changed its name to USDP in order to provide a greater legitimacy for its participation in the elections.


The other was the National Unity Party (NUP). The NUP evolved from the Burmese Socialist Programme Party (BSPP) which became a platform for the military junta in the Sixties and Seventies. As early as the Sixties, the BSPP was crafted by General Ne Win to lend credibility to the military rule. The BSPP renamed as NUP contested the elections in 1990. However, there is a view that over the years this group has moderated its stance and was contesting elections on the grounds that a political transition was crucial for Burma.


Given that both USDP and NUP had a stronghold in the elections as compared to the other registered parties, their ability to influence the outcome would have been better. In this background it will be no surprise if the USDP emerges as the forerunner. It is even being speculated that they will win a majority of the 330 seats in the People's Parliament and the 168 seats in the Nationalities Parliament. Even as the results are awaited, the response of the international community to the elections has been one of disappointment, mainly on account of the fact that the rhetoric of the elections did not meet the promise of expectations.


What remains a puzzle to most Burma observers is that within a week of the elections the junta has released Ms Suu Kyi. While she was the most high-profile political prisoner, there are still about 2,200 political prisoners awaiting release. Moreover, with Ms Suu Kyi's promise that she will continue the democracy struggle, one wonders how long she will remain free. If her release had occurred before the elections, it would have encouraged the NLD to actually contest the elections. This release seems to be more of a negotiating exercise to quell the international opinion that has emerged in the aftermath of the elections — that there is little hope of change within the ruling junta to allow for a free and fair electoral process to shape the political developments within Burma.


In the speech following her release, Ms Suu Kyi urged the Burmese people to continue the struggle for freedom and the fight for their rights. She also hinted that she would urge the Western countries to end the sanctions against Burma and search for new options to bring about international pressure upon the junta to change its stance within the country.


For the international community Burma will continue to pose a challenge. With deeper entrenchment of the junta, little change is to be expected and this means that the measures to engage the junta through diplomatic channels of the Association of Southeast Asian Nations (Asean) and other nations that remain cooperative to the junta will make no headway. The idea of six-party talks for Burma, along the lines of the North Korea talks, has not even made its beginning.


Given that there is a role for both the international community and the United Nations in Burma, perhaps this would be the time to look for a new initiative along the lines of the United Nations-mandated transitions in Cambodia and East Timor. The UN could administer the nation during a transition phase in which political parties could be engaged in a process of national reconciliation. The UN could also allow for the role of the six parties at the international level to assist the process of change. Given that there has been a military government in place since 1962, this would allow the UN to dismantle the administrative structures that the junta has created and controls. This would ensure greater and wider participation, a necessity in the run up to a free and fair election.


The UN role would also allow for the representation of ethnic groups that make up the mosaic of Burma. These groups have not found adequate representation and the elections left several areas out of consideration because of the volatility of the situation. A more concerted effort towards national reconciliation and participation would include these groups too.


The junta may feel complacent with the outcome of the current election, but the leadership in Burma needs to realise that it is a matter of time before its presence is challenged.


- Dr Shankari Sundararaman is an associate professor of

Southeast Asian Studies at the School of International Studies, JNU









I like the look of President Barack Obama's new West Asia envoy, a person with broad experience, the trust of Israelis, growing support among West Bank Palestinians and a fierce personal conviction that a peace accord is essential not only for the parties but for United States national security.


The surprise appointment reflects the need to bring maximum heft to US mediation efforts at a time when Obama himself, major international powers and the Palestinian government led by Prime Minister Salaam Fayyad have all set a target of achieving Palestinian statehood by the second half of 2011.


You missed the announcement? Well it was made so quietly, more through osmosis than anything, that overlooking the change was easy.


So here's the administration's West Asia shift: US secretary of state Hillary Clinton has taken charge.


Oh, I know, George Mitchell, the special envoy who has laboured since early 2009, endures. But the heavy lifting is now in Clinton's hands. Officials in Washington, Jerusalem and Ramallah tell me that the secretary of state will lead what her husband recently called the attempt to "finish Rabin's work".


"She's not insecure about Israel, she will call the shots as she sees them", a senior US official said. "And she would not be engaged if she did not feel there was a way to get there."


Clinton's new role was evident last week. During a video conference with Fayyad, she announced $150 million in direct US aid to the Palestinian Authority (and said America was "deeply disappointed" by "counterproductive" Israeli housing plans in East Jerusalem). The next day she went into nearly eight hours of talk with Israeli Prime Minister Benjamin Netanyahu that opened the negotiations door a crack.


Before I get to that, some background. The Clinton of today is not the Clinton of a decade ago. Compare that sharp criticism of Israel's East Jerusalem building with her 1999 position that Jerusalem is "the eternal and indivisible capital of Israel". Somewhere in the past decade her conviction hardened that the state of Palestine is achievable, inevitable and compatible with Israeli security.


"A bit of an epiphany", in the words of one aide, came in March 2009 on the road to Ramallah. "We drove in a motorcade and you could see the settlements high up, and the brutality of it was so stark", this aide said. "Everyone got quite silent and as we approached Ramallah there were these troops in berets. They were so professional, we thought at first they were Israel Defence Forces. But, no, they were Palestinians, this completely professional outfit, and it was clear this was something new."


That "something" is fundamental: the transition from a self-pitying, self-dramatising Palestinian psyche, with all the cloying accoutrements of victimhood, to a self-affirming culture of pragmatism and institution-building. The shift is incomplete. But it has won Clinton over. And it's powerful enough to pose a whole new set of challenges to Israel: Palestine is serious now.


Another moment came in September 2010 when Clinton held a meeting with Fayyad that threw her schedule off because it ran so long. Fayyad is Mr Self-Empowerment, the Palestinian who, at last, has put facts before "narrative", growth before grumbling, roads before ranting, and security before everything. Clinton, I was told, has "strong views" on Fayyad. She said last week she had "great confidence" in him.


Clinton has been a darling of Israelis since her early days as a senator for New York. That distinguishes her from Obama, who is mistrusted in Israel, and it gives her leverage. Her Palestinian convictions are more recent but intense.


She gets how negotiations must move in tandem with Palestinian change on the ground.
If anyone can persuade Israel that its self-interest involves self-criticism, that occupation is corrosive, that its long-term security demands compromise, and that a new Palestine is emerging, it's Clinton. If anyone can persuade Palestinians that self-pitying unilateralism ("Help us! Recognise an occupied state!") is the way of the past and a road to nowhere, it's Clinton.


I haven't talked about the 90-day extension of Israel's moratorium on settlement building that Clinton seems to have engineered. It's positive but a detail. Some looming big issues are obvious: borders, Jerusalem, refugees. Others are less predictable but potentially explosive.


First: The latest Fatah-Hamas reconciliation efforts in Damascus have failed, defeated by differences on security. Fatah itself is beset by sharp divisions — over President Mahmoud Abbas' leadership and the peace effort. Can Palestinians keep their eye on the prize this time?


Second: New US security guarantees provided to Israel include 20 fighter jets. But what of Iran? Netanyahu wants Obama to build a credible military threat. Ascendant Republicans bay for war. Clinton has to persuade Israel the best way to disarm Iran is by removing the core of Tehran's propaganda — the plight of stateless Palestinians.


Third: Netanyahu is tight with the Republicans who now control the House. He feels stronger vis-à-vis Obama. His temptation to play for time will grow as 2012 draws closer.


But time is not in Israel's favour: Just look what happened to Hillary Clinton over the past decade and extrapolate from that.







A woman is an embodiment of shakti, pure energy. It is this shakti from which the entire creation derives its strength and stimulus. The magnitude of this energy is beyond measure. The entire creation had manifested from the womb of Mata Adi Shakti. A woman, through her perseverance, can achieve the infinite as was exhibited by Goddess Parvati when she won Lord Shiva as her husband.


Our ancients acknowledged this and hence in the Vedic times women were given highest regard. There is a Vedic saying, "Where women are worshipped, there the gods dwell". In fact, Manusmriti explains: "A woman must be honoured and adorned by their fathers, brothers, husbands and brothers-in-law, who desire their own welfare. Where women are honoured, there the gods are pleased; but where they are not honoured, no sacred rite yields rewards. The houses in which female relations are not being duly honoured... perish completely, as if destroyed by magic".


The fate of Ravana was ordained when he dared to disgrace a woman. Ravana met Vedavati at her hermitage, where she had been performing penance with the intention of winning Lord Vishnu as her husband. He proposed to her, but was rejected. He then attempted to molest her by pulling her hair. Incensed by the insult, Vedavati cut her hair and entered the blazing fire, promising that she would be reborn to aid the destruction of Ravana. It was she who was born again as Sita, and was the moving cause for Ravana's death, though Rama was the agent.


The famous statement, "Behind every successful man there is a woman" only goes on to emphasise the Vedic thought of evolution through the union of Shiv-Shakti. Jesus received his gyan from Mother Mary. It was Jijabai who nurtured the heroic Shivaji with values to fight a battle of righteousness. Kalidasa became a renowned scholar only after rejection from his learned wife and subsequent sadhana of Goddess Kali. It was support from wife Hillary that helped former US President Bill Clinton keep his seat despite public outrage. Time and again women have transcended human limitations to become the epitome of love and detachment — Mirabai, courage and determination, Lakshmibai, chastity and loyalty. As Sati they exhibited extraordinary sacrifice, as Savitri they outwitted death.


However, history is also proof that wherever there has been discord between Shiv and Shakti, it has bred devolution. It was only when Sita decided to cross the Lakshman Rekha that Ravana abducted her. Sati had to immolate herself because she did not pay heed to Shiva's advice to not go for the yajna that her father was performing. It was Duryodhan's disregard for mother Gandhari's instruction to be completely unclad that paved the way for his defeat.


In today's heyday of negativity, the discord between the two forces has taken the form of greater evils. Sexual harassment, female infanticide, gender bias, inequality of opportunity, dowry and oppression have impregnated the modern society. As the saying goes, "What you sow, so shall you reap" — there is a draught of love, forgiveness and sacrifice and the world today is contaminated with cowardice, treachery and greed.


It is our responsibility as a society to channelise this shakti that we are blessed with in the form of a woman in a conducive manner for the larger good. Only then can we harness the physical strength of the likes of P.T. Usha and Bachendri Pal, or the creativity of Lata Mangeshkar and Amrita Pritam; the boundless love of Mother Teresa or the power and courage exuded by Kiran Bedi and Sarojini Naidu.


— Yogi Ashwini is an authority on yoga, tantra and the Vedic sciences. He is the guiding light of Dhyan Foundation. He has recently written a book, Sanatan Kriya: 51 Miracles... And a Haunting.


Contact him at [1]








Aung San Suu Kyi is free. Yet she has tempered the spontaneous jubilation over her release with a resounding message to the junta that "if the people are not free, I am not free". And the profoundly striking aspect of her free speech on Sunday must be that at least in public, she harbours no angst against the establishment, however oppressive. As the world's icon of freedom and democracy, she comes through as one who is prepared to countenance the junta with a spirit of reconciliation. Not that she is unaware of the inherent risks of taking on the junta; her willingness to engage in face-to-face talks with the generals implies a tightrope walk that may not be easy to fructify after two decades, and now reinforced through a fraudulent election. She has claimed that she bears no animosity towards the military regime; yet that expression of remarkable magnanimity has been tempered with the assertion that she remains in the vanguard of the struggle for freedom and human rights. Famously has she advanced the message that freedom for the approximately 2,200 others is no less important than her own. "You have to stand up for what is right." Despite such robust expressions of courage, determination and commitment, true democracy may still be a long way away.  The junta may just be trying to lend legitimacy to its spurious victory.  A crucial test is whether the military will allow her to revive the defunct National League for Democracy, and on that will hinge the restoration of freedom and rights.
Critical are the implications in terms of international relations.  Now that she has been freed, the world will have to assess the degree of liberty and also, of course, monitor the junta's attitude. It devolves on the international community to convince the generals to respond to her request for talks.  Despite the belated effusions of welcome, Suu Kyi's release was never an overriding priority of either Delhi or the White House. For all the playing to the parliamentary galleries, President Obama has been in favour of negotiations with the junta, but never explicitly on Suu Kyi's release. India has preferred a diplomatic silence, wary of repercussions in the north-east. Between them, India and America were mindful of China's interest in Myanmar, crucially its natural reserves. Prompt and swift has been the response now of Delhi and Washington. Yet the strident tone in the aftermath of the release ~ pre-eminently of Barack Obama, Hillary Clinton, David Cameron, Angela Merkel and SM Krishna ~ was rather muted through the long years of Suu Kyi's detention. As a cause célèbre, she direly needs the support of the comity of nations, notably the UN. It cannot really be said she has got it.




THE shocking results in this year's Part II examinations only emphasise that half-measures will not suffice in restoring Presidency University's century-old claim to excellence. The under-graduate courses constitute the core which has been hit, first, by the kind of students who have managed to get admission despite tests that should have ensured a place for merit and, second, by the quality of teaching which does no credit to the exacting standards set in the past. The first vice-chancellor, Amita Chatterjee, has one year to get to the root of the problem. This is not just a matter of producing better mark-sheets in the under-graduate examinations but restoring the academic culture that has all but disappeared.  This is glaringly evident when the campus becomes a virtual fortress at the time of student elections  and the results are debated more aggressively than academic achievements. It gets worse when Left-leaning teachers refuse to fall in line with expectations that the conversion of the college into a university is aimed at upgrading standards, within which the policy of rotational transfers needs to discarded at the threshold.

The vice-chancellor has a delicate task when both students and teachers are unionised. She has the agonising task of upgrading infrastructure for post-graduate courses and of cleaning up the mess that she has inherited. The staggering number of failures constitutes just one of the challenges. Another is to ensure faculty with impeccable credentials, and capable of going beyond the limited objective of ensuring success in examinations. At the same time, it is being argued, somewhat speciously, that otherwise "bright'' students are losing interest in their studies or performing poorly because they do not attend classes. If political interests have a lot to do with this, it demonstrates how the academic climate has been allowed to degenerate during the long years of Left rule. Alimuddin Street may have finally given the green signal for making amends. But the rot runs deep and it is anyone's guess whether the new vice-chancellor, with all her good intentions, will get the support she needs to repair damage caused to the reputation of a once-great institution. Pockets of resistance will inevitably survive but, as things now stand, she will have public opinion on her side. Will that be enough?




THE "mysterious" death of one of the male tigers moved from over-populated Ranthambore to de-populated Sariska is a serious setback to the re-location experiment. More so since another male has been untraced for several days despite being fitted with a radio collar. Initial reports seem to rule out the hand of poachers in the death of the cat designated ST-1 (Sariska Tiger-1 as it was the first to be airlifted from Ranthambore in a highly publicised operation in 2008) because its carcass was not stripped of the skin and body parts which attract that brand of criminal. Till a chemical analysis of the remains is completed the possibility of villagers in the vicinity having scattered poisoned baits to try and protect their livestock from tigers (the practice is common around Ranthambore) cannot be discounted. Both "theories" raise serious concerns. Perhaps as grave are the apprehensions arising from the most "popular" explanation that ST-1 died from injuries sustained with a fight with ST-4, part of a turf war. Till ST-4 is located its fate will also be cause for fear, and would a turf war suggest that most of the seven re-located cats have chosen to occupy a limited area of the park ~ one that is too small to sustain them? That there are no firm indications of the re-located animals having reproduced and raised cubs in their new habitat raises concerns of another nature. The first two were later found to be siblings, what of the others? Something, obviously hasn't quite worked out with the first experiment of its kind, nor for that matter has something similar in Panna.

One tiger expert wonders if all the precautions necessary for the re-location experiment were taken; another points to inadequate preparations having been made, two highways still run through Sariska, and villagers and pilgrims remain a source of disturbance. While translocation itself has ever been controversial, there is added anxiety over suspicions that the Ranthambore-Sariska shift was fuelled by a desire to cover up the failure in allowing poachers to decimate Sariska's original populace. A "show". What really dumbfounds the lay man is the inability of all those professing both commitment and knowledge in the field to work in harmony to attain the goal they would all deem desirable. Doesn't the tiger deserve that much?








November was a month of global conferences. Whilst the rest of the world was worried about  the  impact  of  QE-2  and  the  outcome of G-20, I was enjoying the best Peking duck at Da Dong Roast Duck on the east side of Beijing, washed down with Chateau La Lagune 1989 and finest Napa wine. The conversation with good friends was about the changing global financial architecture.  

After the G-20 Summit in Seoul, France will take over the chair of the Group and President Sarkozy has already announced that he intends to discuss reform of the global monetary system or more precisely, the role of the US dollar. There has been a tide of complaints about quantitative easing or another US $ 600 billion of monetary printing around the world, particularly from the emerging markets, but the German and Brazilian finance ministers have also weighed in. 

The real problem with the current monetary system is that the Fed has a real dilemma in coping with the Triffin dilemma. In the 1970s, Yale Professor Robert Triffin articulated the view that the central bank of the reserve currency faces the task of either providing enough liquidity for the rest of the world or providing liquidity for its own nation. If it runs a looser monetary policy, the effect is to run a current account deficit. If it runs a tighter monetary policy (than required by the rest of the world), then the rest of the world gets into a deflation.  

In the last 30 years, the US has taken the first option, gradually accumulating trade deficits that became the Global Imbalance. On the other side of the Pacific, the US was the consumer of choice which built the Asian global supply chain. It was a great bargain for both sides, with Asia exchanging its cheap labour and resources for greenbacks. In return, the US recycled the funds through Wall Street in the form of both foreign direct investment in Asia and portfolio investments. The US became not only banker to the world, but also the investment banker.

Unfortunately, the music stopped when excessive consumption funded by excessive leverage led to the crash of 2008. Since the US economy is going through deflation, Fed has decided to run even looser monetary policy to try and stimulate growth. We are now going through reverse Triffin, where US monetary policy will create more liquidity than the rest of the world needs. The USA is combating deflation and Asia is combating inflation.

The real risk that the Fed runs is not that the US dollar would depreciate against other fiat money (paper currency printed by governments), but depreciate hugely against commodity money (gold). If the World Bank President Bob Zoellick can also hint that we may need to consider going back to including gold in our reserve currency portfolio, it means that confidence in the current reserve currency architecture is really shaken.
If we go back to history, the Triffin Dilemma is exactly the problem facing historical monetary creation. When we use gold or a commodity currency as the standard, then if the supply of gold does not increase in pace with global liquidity needs, the real economy will go through a deflation. The trouble with fiat money is that we can't trust the reserve currency country not to over-print. As the economists used to say, "where is the hard budget constraint?"

In other words, what is to stop Bernanke over-printing the US dollar? The answer is that only Bernanke knows what is the limit. There is no Taylor or gold-link rule that is highly transparent for us to judge whether that limit has been reached. 

The attractiveness of gold is that it is tangible and historically accepted as a standard of measure. The recent supply of gold, according to the World Gold Council, is only 1.5 per cent per annum, so it is not going to be freely available. Since world real growth is in the region of 2-3 per cent per annum, then we need probably a combination of fiat and gold money to ensure that global liquidity needs are matched. 

But who can we trust to be the issuer of this mix of fiat-gold currency? The current answer is likely to be nobody. Not the Euro or any Asian currency, nor the IMF. G-20 can agree to disagree, but no one will agree to a concrete proposal of major institutional reform, because global public goods conflict with too many national interests. There is a real risk that G-20 becomes, like the UN, a veto shop ~ one where you can disagree, but the chances of agreement are small except on general directions that appear to hurt no one.

Most of us take standards for granted, such as the exact measure of a metre or a foot.  But if that standard is no longer dependable, the global system is going towards higher volatility and shock. Either we replace the standard with a more reliable standard, or the world will go through a reshuffling of the pack until the system settles down to a new equilibria.  

The importance of a standard in system stability is often under-estimated and under-appreciated. Think about the value of the currency standard as the quality of a rivet holding a submarine together. The integrity of the submarine as it dives depends on the quality of the rivet keeping the hull intact. If the rivet cracks under certain depth pressure, the whole hull will implode. No more submarine, because the rivet may not have been designed to withstand that depth of pressure.

We are now in a global submarine which is diving deeper and we are no longer sure that the rivet standard can withstand the pressure.

Can anyone bail out? Someone is trying to inflate his way out of the implosion.

Was it "In God we Trust" or "In Gold we Trust"? The missing "L" stands for Lehmans. 

It is so much more fun to enjoy Peking Duck than re-watching the submarine movie Run Silent, Run Deep. 

~ Asia News Network

The writer is Adjunct Professor at Tsinghua University, Beijing, and University of Malaya.  He was formerly the Chairman of the Securities and Futures Commission, Hong Kong







Meagre public expenditure is causing a serious bottleneck in spreading education, especially  in the spheres of elementary and secondary education, says biswadeb chatterjee 


That investment in education is individually and socially rewarding is universally true. However, the less developed a country is, the higher is the return from education. It is around 20 per cent in a developing country compared to 10 per cent in a developed country. The capacity of a country to absorb physical capital and technological progress is often restricted by the availability of human capital. The spread of education among workers leads to more effective utilisation of resources. This is because knowledge is the only factor in production which is not subject to diminishing returns. 

India as an  emerging nation has been involved in spreading education at all levels since Independence. While India has done better than most countries in higher education, the picture in the spheres of elementary and secondary education is not so bright. At the time of Independence, there were 20 universities and approximately 500 colleges in the country which increased to 335 universities and almost 18,000 colleges by 2005-06. India has some of the world's best known teaching institutions such as the IITs and IIMs. The University Grants Commission report shows that as on 31 May, 2009, a total of 479 universities of different types and institutions of a similar nature are operating in the country. It includes 40 central universities, 235 state universities, 39 private universities, 127 deemed universities of which 41 are government and 86 private. There are five state and 33 central institutes of national importance. 

But compared to China, India lags behind in enrolment percentages. While India now enrols 10 per cent of its university-age population, China enrols 22 per cent. Globally, China ranks first with enrolments of 27 million students while India, with 13 million enrolment, ranks third.  But the problem of quality exists in less selective colleges and universities in both countries. Many of India's large number of engineering graduates, up to a staggering 75 per cent according to a McKinsey report, are too poorly educated to function without additional job-related training. China's growing problem of unemployment among graduates is also related to qualifications.  To check mushrooming growth of institutions of higher education,  Kapil Sibal, HRD minister, has either denotified some institutions with deemed university status or has served notices to them. Anyway, the low standard of higher education, particularly technical education, is bound to affect economic development. 
The situation at the school level is  pathetic. Up to 2002, enrolment at the upper primary level (grades 6 to 8) was only 61 per cent. It was 36 per cent at the secondary level (grades 9 to 12) and nine per cent at the secondary to post-graduate level.  The effect of the Sarva Shiksha Abhiyan (SSA) and the Mid-Day Meal  Scheme, both introduced in 2001, is yet to be felt. But data does not show any improvement.  Although the net annual average enrolment ratio at the primary level for the period 2003-08 was reported to be 90 per cent for boys and 87 per cent for girls, the survival ratio was only 66 per cent. For the same period, the average enrolment ratio at the secondary level was 59 per cent for boys and 49 per cent for girls. Despite the two national policy statements in 1968 and 1986 (revised in 1992) and the launching of the national movement for universal (elementary) education (SSA) with the mid-day meal scheme in 2001, the goal of cent per cent school enrolment is still far away. To improve the situation, the Right to Education Act was passed in 2009 which seeks compulsory education up to the eighth standard for all children up to age 14.  So the HRD ministry's data that the total enrolment ratio for children of the age group 6-14 in classes I-VIII is almost 97 per cent is hardly credible.  Moreover, the ratio of students enrolled but absent is not only high but also increasing. This is worrying  policy makers. 

States also show wide variations in respect of educational infrastructure (number of schools, colleges and universities), primary education index and per capita income. The primary education index includes the literacy rate, proportion of children completing primary schooling at the right age, teacher to pupil ratio, female to male student ratio and state expenditure on elementary schooling per child in the six to 14 year age group. It is seen that some states are backward in terms of per capita income but advanced in educational infrastructure. They are Uttar Pradesh, Orissa, Rajasthan, Madhya Pradesh, Bihar and Assam. The reverse is true for Haryana, Himachal Pradesh, Kerala and Punjab. States which have more or less reasonable infrastructure in education are Gujarat, Maharashtra, Tamil Nadu, Karnataka, Andhra Pradesh, Chattishgarh and West Bengal. 

 States also have striking contrasts and significant variations in respect of the primary education index (taken roughly as human development index or HDI) and estimates of per capita income. States like Himachal Pradesh, Kerala, Maharashtra and Tamil Nadu are achieving both. Uttarakhand, Assam and Jammu and Kashmir have made notable progress in HDI despite lagging behind in respect of economic development. Punjab, Haryana, Gujarat, Andhra Pradesh, West Bengal and Chattishgarh are way ahead in economic development but are lagging in respect of HDI. The seven other states have maintained a balance between the two. Among them, Uttar Pradesh, Tamil Nadu, Orissa, Karnataka and Bihar have a perfect balance. 

It means that economic development in terms of high per capita income does not necessarily mean better HDI in terms of infrastructure, sex ratio, literacy rate and state expenditure on education. Rather a number of states have shown satisfactory progress in HDI even at the lower level of per capita income. Jammu and Kashmir, ranked 13th in per capita income but fifth in the primary education index, is the best example in this regard.
Meagre public expenditure is causing a serious bottleneck in spreading education. The 11th Plan outlay for education was promised to be 20 per cent of the total. But a primary analysis of the Union Budget for three years from 2007-08 to 2009-10 does not conform to the promises. Spending on education as per the budget estimate for 2009-10 was Rs. 44,528 crore (0.76 per cent of GDP) while it was Rs. 1.3 lakh crore (around 2.3 per cent) by the state governments as per their 2008-09 budget estimates. Despite reiterating the commitment to take government spending on education to six per cent of GDP, joint spending by the Union and state governments remains only 3.7 per cent. The worst to suffer on account of low spending has been elementary education.

The writer is associate professor of economics, Durgapur Government College








It began with a chance encounter on a train with a stranger, though not in the same league as in Alfred Hitchcock's film "Strangers on a train". Far from it. There was nothing eerie about the untidy passenger sitting next to me and munching peanuts. If there was any suspense aboard, it was in my wondering for how long was he going to pull nuts out of his kurta pocket and crack them open. He took care to place the empty nutshells in his handkerchief, unlike the other passengers mindlessly discharging them all over the floor. Soon the suspense of how many peanuts he had up his sleeve turned into an irritant for me, like visuals on TV news channels repeated ad nauseam. So I ignored him and took out a book I had brought along to read. 

"Is the book interesting?" I heard a voice close by. I turned to note that the nut-cracking fellow was eyeing the cover of the book in my hand. "Don Quixote", he spelt out. "A serious reader, eh?" I didn't know whether it was a question or a statement. 

"Yes, it's quite witty," I ventured to reply to his two questions, chronologically. "And, yes, I am what you may call a reader in the classical mould. Runs in the family." 

He smiled and nodded his head. "Cervantes was really good, truly great," he pronounced. Was he, in addition to cracking nuts, a nutty professor in some college? Except for a handful of eccentric readers like me, only professors teaching the text would be having any acquaintance with that eccentric "Knight of the Woeful Figure". "I am Librarian at the State Library," he resolved my curiosity about his vocation without beating about the bush. But was he the Librarian of that Library or only a Librarian there? I let the mystery of that one remain hanging. "And what about you? Where do you teach?" he asked. The sense of suspense about our respective professions was mutual! 

"I am a retired bank officer," I revealed. His eyebrows went up. Bankers were supposed to deal with "dons" of a different genre, and their sport was to help build windmills, not tilt at them! "As I said, this hobby of reading classics runs in our family," I  repeated and smiled in turn. 

"Why don't you drop in at our Library?" he invited me as we neared our destination. "We have a large collection of books ~ especially old books." I was aghast. Visiting a government library, that mass grave for precious books! The distaste on my face must have been palpable. "Come and see for yourself," he persuaded me quietly. 

When I did call on him at the State Library, a revelation awaited me. The 50,000-odd books had been neatly segregated, subject-wise, region-wise and historically too though a few periodicals were lying about on the flood. All the books were dusted regularly. Even white ants were conspicuous by their absence, kept at bay by regular "treatment" of all nooks and corners of the building. Most wonderful of all, the attendants were not found dozing! The library was expanding, he showed me, with a new building adjacent that would have two reading halls. It spoke volumes about the usefulness of the library that its existing hall was full of youngsters preparing for various entrance tests. 

I discovered my "Treasure Island", a trove of classics and the contemporary, enough to last a lifetime and more! While enrolling as a life member, I also uncovered that the stranger who had led me to this treasure was the librarian of the State Library, monarch of all he surveyed. Appearances are deceptive in libraries and men ~ and not merely in Hitchcock's movies. 






Trial Of An Absconding accused 

On Monday afternoon before Mr Hopkyns, Joint Magistrate of Alipore, Harish Chandra Ghosh was charged under Sections 121A, 122, 123, and 124, IPC with having conspired with the Maniktolla Gang to wage war against the King. Babu Dharmadus Banerji, pleader, appeared for the prosecution, while the accused was undefended. 

The pleader for the prosecution, reviewing the facts of the Alipore bomb case, stated that a warrant was issued against the accused on the July 13, 1908, during the hearing of the bomb case, but the accused had been absconding until his arrest in October last. The pleader further stated that the accused was mainly associated with Satyendro Nath Bose, who was hanged in connection with the murder of Narendra Nath Gossain. Besides, there was evidence to show that the accused was for sometime the proprietor of the "Sadhana" press where the Yugantar used to be printed, and he was also for some time the declared printer of the Yugantar, thus associating himself with most of the accused in the Alipore bomb case. 

Inspector Purna Chandra Biswas, of the Bengal CID, was the first witness called. He gave a brief history of the discovery of the Maniktolla conspiracy with which the accused is alleged to have been associated. The case was adjourned. 

Two Passengers Drowned And Five Missing 

In the early morning of Tuesday at about 2 A.M. at Rajarkhal, Belliaghatta, a passenger boat suddenly sunk with all the passengers. It appears that a boatman named Jobber Munji, who used to ply between Bhangore and Belliaghatta was conveying a load of passengers, and when the boat was rear the mouth of the Rajakhal it suddenly sunk. Most of the passengers were saved but five are reported to be still missing, and two were found dead. Their bodies have been recovered. Most of the passengers were litigants in the Alipore Courts. Of the two persons found dead, one was an accused in a case of alleged rioting with murder. The loss of property was about Rs 500 in cash and notes.















Diplomacy is the art of letting other people achieve your ends. Barack Obama's visit seems to have achieved that with deals for American companies valued at approximately $15 billion, which will help create over 72,000 jobs back home. After his Democratic Party was drubbed at the midterm polls, creating jobs when unemployment is nearly 10 per cent is critical to political survival. His appeals to Indian companies to invest in the United States of America and to buy US exports — India runs a trade surplus of roughly $7 billion — were the highlights of his public speeches and his discussions with the prime minister, Manmohan Singh, implying bilateral trade between the two countries could double to $100 billion in five years. The IT companies' concerns over US government policies on outsourcing appear to have been given short shrift, as was the question of access to US markets. True, Mr Obama made clear that the thorny issues surrounding technology transfer would be reviewed; he also announced the removal of several Indian defence labs and the department of space from the US blacklist that prevents the transfer of sensitive, dual-use technologies related to the nuclear energy industry. But the Indian business establishment is not too unhappy with the results. Has Mr Obama given too little in return? Maybe not.


Take outsourcing. Mr Obama's healthcare bill, which is awaiting passage in the US Congress, will result in more contracts for India's business process outsourcing industry. The National Association of Software and Services Companies is working on changing the politically-charged use of outsourcing to 'global sourcing', as with any supply chain. The US Border Security Act that increased H1B visa fees also seeks to diversify the countries from which BPO services might be used by American companies; leading Indian IT companies are setting up shop in neighbouring countries (even China) and supply their services from outside India. What America exports are not commodities, but technology that Indian companies seeking to build India's physical and energy infrastructure desperately need. Access to American technology and the lowering of barriers to it augur well for India's ambitions of rapidly becoming a global economic power.


More American companies are shifting their manufacturing bases to India, most visibly in the automobile industry; GM's production facilities may be leveraging the Indian consumer's buying power, but they are also developing India as an export hub. What is happening in the auto sector could extend to aerospace in the next decade or so — recognition of India as a rising technology and manufacturing power. Mark Twain said that the principle of give and take is the principle of diplomacy: give one and take ten. Perhaps, that is what India should do.








The 'outsiders' continue to be soft targets for ethnic militants in the Northeast. The 23 non-Assamese people who were brutally killed by a Bodo group in Assam earlier this month had nothing to do with local politics or the anti-insurgency operations in the state. Many of them did not even live in Assam; they were travelling to Arunachal Pradesh, where they lived and worked. The militants who killed them apparently did so to avenge the death of a Bodo militant during an operation by the security forces. This massacre of innocent people can only point to the increasing desperation of the Bodo militants, especially those belonging to the National Democratic Front of Bodoland. This outfit has stubbornly refused to take part in the peace process that the Centre and the Assam government had begun with other Bodo groups. Its violent ways have also frustrated the Bodoland autonomous council's attempts to usher in a new, democratic way of life for the community.


The killings should be a grim reminder to the Tarun Gogoi government that ethnic violence is still a matter of serious concern in Assam. True, the United Liberation Front of Asom, the biggest militant group, is in disarray following the arrest of most of its senior leaders. But that seems to have made the government somewhat complacent. Mr Gogoi has complained of a shortage of Central forces in the state following the shifting of some of these to Bihar for the elections there. But there are indications that the Bodo militants have taken advantage of the administration's lax attitude in the wake of its successes against the Ulfa. While it tries to engage the Ulfa in fresh peace initiatives, the state cannot afford to lower its guard against Bodo and other militant groups. A violent group's ability to kill or cause destruction is not linked to its numerical strength.









A second French Revolution seems to be just round the corner. As I write this, agitating mobs have virtually brought life in France to a standstill. They are protesting against the French government's decision to introduce reforms in their pension system, the main component of the reform being the proposal to increase the minimum eligible age for pensions from 60 to 62. Of course, large sections of the population hate President Sarkozy (the hate seems to be reciprocated) because his policies are considered too conservative. This may be the more important reason explaining the intensity of the opposition to the proposed change because pension reform is inevitable not just in France, but in all countries that have a well-developed social security system.


The inevitability of change is because of the rapidly changing age composition of populations across the world. Dramatic breakthroughs in medicine, combined with higher incomes and hence better nutrition, have been instrumental in significant increases in life expectancy. Lifestyle changes, particularly in the West, have also resulted in later marriages and hence lower birth rates. These two tendencies mean that the world's population is ageing. Estimates made by the United Nations show that the proportion of the world's population above 65 years will more than double by 2050, so that every one person in six will be 'old'. Even developing countries will experience this large change. For instance, India's over-65 population is expected to reach 12 per cent of the total population by 2025.


The increase in the old-age dependency ratio, which is defined as the number of over 65s to the population in the age group 15-64, will have profound consequences on national public finances and overall government policies. It is obvious that much of our spending is age-related. For instance, the larger the number of elderly members in a family, the greater is the proportion of expenditure on medicines and healthcare. Moreover, in most families, the younger members have to provide some income support to the older members. The latter may have saved throughout their earning life, but retirement funds typically do not prove sufficient for all their needs.


What is true for representative families is true for the nation as a whole. Countries will have to incur increasingly larger age-related expenditures in the form of significantly higher outlays on healthcare and pension support. One estimate suggests that the average cost of providing long-term care for the aged will increase by over 1.3 per cent of gross domestic product in the advanced economies. This is in addition to the increased budgetary support required to support pension schemes. Some of the projections made of the funds necessary to support these schemes are truly mind-boggling — as high as 15.8 per cent of GDP in Italy by 2032, and 16 per cent of GDP in France by 2040.


Some optimists argue that the increased spending on the elderly will be balanced by a corresponding reduction on the costs of educating the relatively smaller number of the young. Unfortunately, this does not quite square with the facts. Economies are becoming increasingly knowledge-based and technology-intensive. For instance, even in relatively poor countries like India, most good schools will have large numbers of computers, much better scientific equipment than before. The implication is that there has been a huge increase in the per capita cost of education. This is likely to wipe out any potential saving that could have been achieved because of the need to educate a smaller number of children.


Of course, there will be quite large differences across countries. The effect will be most pronounced in advanced economies and emerging market economies in Europe. These are the countries which have social security systems that provide a broad spectrum of benefits to its citizens, as well as a significantly worse demographic age profile. Conversely, countries like India hardly have any wide social security system covering all segments of the population. If current social institutions are preserved, then there will be correspondingly less pressure on government finances. However, presumably developing countries do want to emulate some of the better features of life in advanced countries. A well-developed social security system is certainly one of the most attractive features of advanced economies. So, over time, the pressure on public finances in developing countries will also become quite acute.


Of course, world incomes have grown appreciably in the past because of technological progress. There is no reason to believe that similar increases will not ease the pressures in the future. The greater the increase in national per capita incomes, the easier it is to provide for the aged. Unfortunately, the magnitude of the future problem seems so severe that some appropriate policy responses seem inevitable. What are the feasible policy options?


One option is to scale back the amount of compensation. Of course, such a change cannot be implemented in the immediate future. Those whose pensions are sought to be reduced must be given sufficient time to ensure that they have made ample provisions for the future. This means increasing savings during the years of earning over a long period of time, and so the process must start long before people actually retire.


The more promising option is precisely the reform proposal that has resulted in the French agitation. The most prevalent form of pensions is the pay-as-you-go system in which payments to the retired persons are made out of the contributions made by current workers. Pushing back the age of retirement would help in several ways. First, this would increase the size of the national cake since the stock of the productive labour force would be larger. Second, this would mean that the number of people contributing to the pension kitty would be larger. Third, the number of people receiving pensions would also be smaller.


But why is this system fair? Why make the elderly work for an extra couple of years? The reason why at least some increase in the age of retirement is needed is that the overwhelming majority of people are today perfectly fit to work much longer. Indeed, life expectancy is so much higher today because people are in much better health and so are capable of working several more years. 'Old age' is a relative concept, relative to the times we are in. It is worth pointing out that Leonid Hurwicz, who shared the Nobel prize in economics in 2007, was academically active till the day he died — at the age of ninety.


The author is professor of economics, University of Warwick








Nepal has no king. Nepal has no prime minister, no government, no constitution. All that Nepal has is a number of political parties, none of which commands majority support and hence cannot form a government on its own. Nor can they form a viable coalition because of the basic differences they have with one another. And Nepal has a huge population, which, only the other day, had overthrown the old order, hoping that a new future will follow. That has not happened, and nobody can say with any degree of certainty that a sizeable section of the same population will not shake their heads and say, "Let's go back to royalty. Our problems will not be solved but at least we will have somebody to blame for our sufferings. "


It is a situation not ideal for Nepal but very much so for two countries — China and Pakistan. Both countries had always been anxious at Nepal being, for geographic and historic reasons, tied to India more firmly than they would have liked. Now, in this situation of flux, both have the opportunity of unitedly egging on the anti-India forces that have always been active in the former Himalayan kingdom. This will not help bring any solution in Kathmandu, but New Delhi will have to suffer the continuous discomfort of having a restless and increasingly hostile neighbour.


The Maoists, with the largest number of elected representatives, have never had any love lost for India, which they see as an imperialist force. The Communist Party of Nepal (Unified Marxist-Leninist) does not go to that extent but also feels that Nepal has always had a raw deal from India. And then there are the groups of intellectuals who are once again demanding that the boundaries with India be re-drawn.


Second revolution


The specious argument is that since the Treaty of Sugauli no longer exists — the Indo-Nepal agreement of 1950 made all past treaties with the colonialists redundant — there should be a new look at the boundaries. Such an attitude can spell danger, especially since the forces in Nepal that cannot join hands to form a government are having no problems in coming together for India-baiting. This may well be the plank on which the Maoists and the CPN(UML) choose to unite, a process that will be aided if Pushpa Kamal Dahal, alias Prachanda, agrees to make himself scarce. The other parties, of course, will not like this, but they are in no position to provide an alternative. As for New Delhi, with its limited options, it will perhaps be happier to see a government rather than no government, which encourages irresponsibility.


It is difficult to imagine that any such arrangement will last for long. The Maoists have their own agenda, which they cannot be expected to shelve for too long. Actually, the trouble lies squarely with them — they cannot be fitted into a scheme that they are dead against. They themselves know their problem, but how can they change themselves and their ideology? Right now, they are also trying to find a way out of the impasse but that will have to be, as far as possible, on their own terms. The CPN(UML) may agree upto a point, but what about the central demand that Maoist cadres be inducted into the army? Prachanda is unlikely to budge from this position unless his friends in Beijing tell him to do so.

Unlike the political parties and their leaders, the man on the street is eager for a solution to the current troubles in Nepal, since all government functioning has come to a stop. As the political class goes round and round the bush, may he not in exasperation want to break out and give Kathmandu its 'second revolution' to restore monarchy? That possibility cannot perhaps be entirely ruled out. Particularly since he is not without friends in high places.


******************************************************************************************DECCAN HERALD





The collapse of a four-storey building in Delhi has left over 66 people dead and another 130 injured. Efforts are on to rescue people who are still trapped in the building. Most of those staying in the building were migrants. Although the building was just 15 years old, this was an accident that was waiting to happen. It has been reported that the building was of poor quality. Situated near the river Yamuna, it was among several buildings that suffered much due to waterlogging during the recent monsoons. To add to its problems, an illegal fifth floor was under construction. Eyewitnesses have said that as horrific as the collapse of the building was the chaos and confusion that followed. Apparently, it was several hours before disaster management teams arrived at the spot. During this period it was locals who with their bare hands lifted the rubble to rescue the trapped. Fire tenders and cranes reached the disaster site after almost five hours as they could not make their way through the narrow lanes. Then came politicians and VIPs, who in their zeal to be captured on camera at the site of the tragedy, ended up obstructing and slowing down rescue efforts.


The tragedy could have been averted had various government departments acted on the warning of an activist, who filed his first complaint relating to this building 10 years ago. Since then, he has reportedly filed scores of complaints about the brazen violation of norms in its construction. But no one paid heed to his warnings. He has said that there are at least another 140 buildings in the neighbourhood that are as unsafe as the one that collapsed on Monday. Will authorities pay attention to his counsel at least now?

It takes little to make an unauthorised construction legal in this country. Slip in a few wads of currency notes into the hands of officials and the work is done. However, the human cost of such corruption, which becomes visible when these buildings collapse, is enormous. When tragedy strikes nobody is held accountable. Over 123 people were killed when, Gangarams, a leading bookstore in Bangalore city, collapsed in the early 1980s. The accused walked free. It is this failure to bring to justice those who allow illegal constructions that result in such continued disasters. The Delhi government should fix the responsibility for the latest tragedy so that the perpetrators get the right message.








The industrial output data for the month of September, which have now been released, are not a good augury as they do not support the optimistic claims about fast economic growth. The downbeat figures were one reason for the whacking the stock markets received in the last few days, though there were global reasons also. In a climate where high growth has been taken for granted, the fall in output growth across most of the sectors attests to the existence of problems which need to be better understood and addressed. What is of concern is that this decline is not a sudden development because of the emergence of a one-time factor. Looking at the behaviour of the indicators over the past few months, a persisting trend of slow growth is discernible.

The September output growth at 4.4 per cent was the lowest for the past 10 months. The capital goods sector actually declined by 4.2 per cent against a growth of about 8 per cent during the same period last year. The sector is a good indicator of capital investment and therefore slackness in it will turn out to be a negative for growth. Other important sectors have also shown indifferent performance. Manufacturing and power sectors expanded at a pace much slower than required at this stage of growth. The growth in manufacturing was very uneven too. Out of the 17 industries in the purview of the IIP, five contributed to 76 per cent of the output. But for the performance of the five, the overall figures would have presented a worse picture. The only sector that beat expectations was the consumer durables. The sector did well in September and has consistently outperformed in the last many months. But that is not the best consolation in view of the disappointment caused by the performance of other sectors.

Finance minister Pranab Mukherjee has said it was difficult to understand the reasons for the fall in the numbers. The underlying  momentum in the economy may still be intact but there are factors that constrain continued growth. The inability of the infrastructure sector to grow according to the requirements and problems with credit availability may be among them. The trend needs to be reversed in the coming months, if the growth momentum is not to be lost. That calls for decisions at the level of policy and more effective action at the implementation level.







Some people believe that Sarkozy's real goal is dismantling the public social security system based on solidarity among generations.


It's no surprise. For over two centuries, protest has been a part of the political genetic code of French society. In addition to being constitutionally guaranteed, street protests and strikes are natural ways of fully exercising citizenship. Each new generation considers that participating in cyclic fits of social anger is a rite of passage to become a full member of the democracy.

This time the crisis was triggered by the French president. Discredited and besmirched by various rank scandals, blinded by the International Monetary Fund and credit rating agencies, Nicholas Sarkozy is proving oblivious to people's concerns and is trying to demolish one of the crown jewels of the welfare state: the right to retire at the age of 60.

Won after decades of struggle, this social victory is seen in the French collective imagination as untouchable. Sarkozy, who in 2008 promised to respect it, has underestimated the public's attachment to this right. Taking advantage of the shock produced by the global economic crisis, he is trying to push through a reform that would raise the legal retirement age from 60 to 62, increase the contribution period to 41.5 years, and raise the age at which you can collect a full pension from 65 to 67 years.

Some believe that Sarkozy's real goal is dismantling the public social security system based on solidarity among generations, and replace it with a private scheme that would represent a market of between 40-100 billion euros. They note that the insurance company that would benefit most from such a move is the Malakoff Mederic group, whose CEO is none other than Guillaume Sarkozy, the brother of the president.

The reaction of the major unions is unanimous. Without rejecting the proposal entirely, they are demanding changes, arguing that the cost of the reform would fall primarily on salary workers, already reeling from the crisis, and that this would create greater inequality. They organised a few days of protests before the summer. But the government arrogantly maintained its blanket refusal to negotiate.


That was a major error. When people returned to work in September after the holidays, the general assemblies met in hundreds of workplaces and salary workers reaffirmed their 'not a step backwards' position. They were convinced that giving up something as sacred as retirement at 60 would trigger an avalanche of additional cuts in social security, health care, education, and public services.

These meetings demonstrated that union leadership was much less radical than the rank and file, exasperated by the constant erosion of social advances. Immediately after, there was a rash of collective actions across the country; millions took to the streets; the prolonged general strike slowed transport to a crawl; certain cities, like Marseilles, were entirely paralysed. With every addition day of actions new elements of society joined the protest, which assumed unprecedented forms.


The most original is the blockade of refineries and oil depots. The most notable is the massive incorporation of secondary school students into the protests. Many assumed this was the Facebook generation, autistic and self-absorbed, but their confrontational energy revealed an anxiety about the future and a fear that for the first time since 1945, if nothing changed, they would be worse off than their parents. The new neoliberal model destroyed the social ladder.

The protests are the crystallisation of a profound social malaise and an accumulation of woes: unemployment, precariousness, poverty (there are 8 million poor), the hardships of daily life. Thus it is not merely a matter of pensions but a fight for another social model.

What is most important is that a sizable majority of the French people — 60 per cent to 70 per cent — support the protests. How is it possible that the France of 1945, ravaged by World War II, could afford a welfare state and yet today's France, the fifth greatest economy in the world, cannot? Never before has there been such wealth.

In 2009 the five largest banks reported profits of 11 billion euros while the 40 largest companies cleared 47 billion euros. Why not tax these colossal sums to benefit the pensioners? The European Commission estimates that a small tax on financial transactions would bring EU governments between 145-372 billion euros per year — certainly enough to shore up the pension systems.

But neoliberal dogma requires that capital remain off limits for taxation, which would be increased instead on individual income.

And thus the current mood in France. The general feeling is that neither of the opposing forces can give in. The unions, driven by a groundswell of radicalisation, remain united after months of their offensive. To give in would be a defeat like that of the British miners by Margaret Thatcher in 1985, which spelled the end of workers resistance in the UK and opened the door to ultraliberal 'shock therapy.'

Sarkozy has the backing of the EU, the IMF, and European banking and business sectors, which are terrified that the 'French spark' could ignite the whole continent. The defeat of his reforms would condemn him to defeat at the polls in 2012. The social history of France teaches that when protests spread to the extent they have today, they will never recede. They always win.








Iraq's neighbours hope that Allawi would re-establish a secular, nationalist regime in the country.


The US, Iran and Iraq's Arab neighbours were all involved in the making of the fragile deal for a power-sharing government eight months after Iraqis elected a new parliament. Under the deal, the 325 member national assembly elected Usama al-Nujaifi, a Sunni, as speaker; President Jalal Talabani, a Kurd, was given a second term; and he called on incumbent Premier Nuri al-Maliki, a Shia, to form a government.

But there are many reasons why the deal could fall apart.  The first is deep mistrust of Maliki. When parliament met 12 hours after the arrangement had been concluded, members of Iraqiya, the largest faction, stormed out of the chamber, proclaiming that its partners had broken the deal by not promptly seating three Iraqiya deputies banned due to alleged ties to the outlawed Baath party.

While Iraqiya lawmakers attended the session on Nov 13 after they were assured the ban would be lifted, the bloc is divided. Its head, Ayad Allawi, a former post-war premier, announced that the deal is 'dead' although a majority of Iraqiya deputies disagree. They could change their minds if Maliki does not deliver on the deal. Allawi has been promised the chairmanship of a national security council but if it is not vested with powers to oversee the armed forces and police, he and his followers could either boycott the assembly or go into opposition.

Insurgency option

Without the participation of Iraqiya, the new regime would be a continuation of the 2006 Shia-Kurdish partnership which marginalised Arab Sunnis, secular Iraqis, Christians and others who voted for Iraqiya. If sidelined once again, Sunnis could join al-Qaeda or resume the nationalist insurgency.

Aware of this threat to the stability of the country, all the external powers, including Iran pressed the squabbling Iraqi politicians to reach an 'inclusive' deal incorporating Iraqiya.      

Nevertheless, Maliki is unlikely to cede his monopoly over the security forces to Allawi, his main rival for the premiership, who will not be satisfied with a post empty of authority. Maliki, a Shia sectarian closely tied to Tehran, is not really ready to empower Sunnis, secularists,  former Baathists and others who do not subscribe to the ethno-sectarian system imposed on Iraq by the Bush administration.

Maliki took on risky allies to secure a second term. First, Iran compelled anti-US Shia cleric Muqtada al-Sadr to form the alliance with Maliki that gave him the seats he needed to form a government. Sadr, however, deeply dislikes Maliki who in 2008 ordered US and Iraqi forces to crush the Sadrist militia which held sway in the south and in Shia areas of Baghdad.

Second, Maliki turned to the Kurdish bloc which laid down 19 conditions for backing him.  The Kurds want a referendum in oil-rich Kirkuk and adjoining provinces to determine if a majority of the residents want to join the Kurdish autonomous region. Arab and Turkomen inhabitants of the areas the Kurds claim threaten civil war if Baghdad accepts this demand. The Kurds also want control over their region's oil resources which most Iraqis insist must be controlled by Baghdad.

The external powers that pressured the Iraqis to make the deal are also destabilising because they are working at cross purposes. The Obama administration, which intends to pull out US forces by the end of next year, wants the new Iraqi government to be inclusive and an expression of national unity rather than a regime run by Shia sectarian and Kurdish separatist parties. However, the administration, desperate to depart from Iraq, is prepared to accept any sort of government as long as it hangs onto power long enough for the US to declare victory and leave.

Iran seeks to maintain the considerable influence it has acquired in Baghdad since the fall of the Baath party and to transform Iraq into the world's second Shia power. This would boost Iran's standing in the region and the Muslim world at the expense of the US and the West. Since Iraq has the world's second largest oil resources, Iran stands to gain leverage over western powers that depend on West Asian oil and gas for energy. This will make it more difficult for them to impose sanctions on Tehran to compel it to halt its nuclear programme.

Iraq's Sunni neighbours — Turkey, Saudi Arabia, the Gulf states, Syria and Jordan — which supported Allawi's bid for the premiership in the vain hope that he would be able to re-establish a secular, nationalist regime in Iraq, see US influence waning, oppose the Iranian project and are wary of Maliki and the Kurds.








They direct their art to impress large gatherings and to draw applause.


Some people's capacity for public speaking is phenomenal. They speak for all and sundry occasions. There is no subject on which they cannot speak; topics may range from Bharatnatyam to Kalaripayattu, Ghalib to Ramayana. You choose the topic, they are ready with a speech. There is no inadequacy in them. They are the special breed of public speakers, ubiquitously present on every public platform.

They have honed public speaking into a fine art. The 'art' they pursue is 'artful'. They direct their art to impress large gatherings and to draw applause. In this they succeed admirably. They speak with ease at gatherings of rationalists on the virtues of sceptical attitude. Next you would find them speaking for religious gatherings with equal vehemence upon the necessity of unconditional acceptance of its teachings, the teaching depending upon the religion on which they are speaking for the moment. Unmindful of the contradictions they keep going with great gusto.

To a person, who has heard them on different occasions, having doubts in their honesty is natural enough. A friend who belongs to this category of public speakers was questioned once. But undeterred he pursues his art in a most brazen manner. You scratch him only to know his knowledge is at best superficial but yet his ability to put his art into use has remained undiminished.

To appreciate the point, all one needs to do is to follow any such speaker in any media over a period of time. There is no dearth of them. Politicians and religious gurus take the lead. One would realise that while the politician's gluttony for eating his own words is insatiable, the latter's public uttering is often sanctimonious humbuggery.

What keeps these people ticking in public life? Is it the credulity of the people who come to hear them or is it that they have no means to test the veracity of the speaker or are they indifferent? The truth may lie in any of these. These are our present day leaders. Their means of attaining the leadership may be anything, but their tenacity to remain there entirely depends on their public speaking and image building.

But the irony is that these leaders, instead of leading are invariably led by the mass. The consequence is obfuscation of social issues and a loss of direction. There is hardly a leader who can speak out his conscience and guide the people. They have become redundant in a society where there is constant erosion of values. Instead the society is churning out pygmies. Paradoxically these are the leaders perhaps the society deserves too.

Comparisons may be odious. But one cannot help reminiscing an illiterate priest from Dakshineshwar, galvanising a small band of men, setting a world mission in motion or a loin clad Gandhi stirring millions of his countrymen to bring down a mighty empire! They spoke plain and simple. Yet they always spoke truth.




******************************************************************************************THE NEW YORK TIMES




On Tuesday, Apple released the entire Beatles catalog on the iTunes store — as individual songs, as albums, and as a box set without the box, and all in the remastered versions made available last year. Getting to this digital offering wasn't easy. It took years of negotiations, a lawsuit with the Beatles' own Apple Corps over the Apple trademark, and agreements with Paul McCartney, Ringo Starr, the widows of John Lennon and George Harrison, and EMI, which controls the right to release Beatles recordings.


The deal means new revenue for everybody concerned, but may be most important to Apple — Steve Jobs's Apple — and not just for financial reasons. To many people of Mr. Jobs's generation (and to other generations, too), the Beatles created the most important body of music in the 20th century. Adding the Beatles catalog to iTunes doesn't simply plug a gaping hole in the music store's offerings. It creates an imprimatur, a cultural validation, of a kind that Apple has rarely needed or ever sought from anyone else.


Apple is usually the one doing the validating, at least since the introduction of the iPod in 2001. Its culture is closed, its designs exemplary, its products highly profitable, and in Mr. Jobs it has a spokesman who doesn't suffer fools. It makes you wonder what Apple could possibly want that it can't already get.


Until Tuesday, the answer was the Beatles. Just how important they are to Apple is evident in the patience and the determination with which the company pursued them. This is a business deal, of course, and a shrewd one for everyone involved. But we suspect that for Mr. Jobs, there is also an almost adolescent fulfillment in finally bringing the Beatles to iTunes. At least, we like to think so.








It took five long years. The Department of Housing and Urban Development has finally persuaded Mississippi to do right by Hurricane Katrina survivors who were unfairly shut out of a federally financed disaster aid program designed by the state. Congress needs to rewrite disaster aid regulations so that a travesty like this one never happens again.


The long delay in serving these needy families dates back to the Bush administration, which seemed inclined to let the state do anything it wanted to do with the $5.5 billion allotment of federal aid that Congress gave it after the storm. The law required that states and localities spend half the money on low- and moderate-income families, which should not have been difficult in the poorest state in the union.


But the Bush administration allowed the state to waive the income requirement on some projects. And despite evidence that many Katrina survivors still needed housing, the administration, in 2007, let the state shift $600 million of recovery to aid the refurbishment of the Port of Gulfport, a pet project conceived long before the storm. The Mississippi N.A.A.C.P. and the Gulf Coast Fair Housing Center then sued HUD, arguing the transfer violated federal disaster aid regulations.


Prompted by the lawsuit, the Obama administration began pressing Mississippi to revisit its housing aid policies, which led to the creation of a new program that was announced by the HUD secretary, Shaun Donovan, earlier this week.


Under the agreement, Mississippi will set aside $132 million, all of it from existing Katrina assistance programs, to help low-income victims with unmet housing needs. The new program has already identified more than 4,400 such people and expects to turn up many more after a new outreach effort starts.


The new program also will cure a fatal flaw in the original plan, which shut out victims whose homes were destroyed by wind, rather than water.







Millions of Americans are out of work. The government is running a $1.3 trillion deficit. We just had an election that sent at least one clear signal: cut that deficit. So what is Washington talking about? Earmarks, the $15.9 billion in projects designated by Congress in the last fiscal year for favorite projects. That's less than half of 1 percent of federal spending.


Blaming earmarks for the country's fiscal ills has been a favorite Tea Party talking point and a way to avoid a more serious discussion of the real mix of difficult spending cuts and tax increases that are the only way to dig the country out of this hole. After Representative John Boehner, the likely next House speaker, pledged to stop earmarking spending bills — a position received warmly by the White House — many Republican senators said they would join the effort.


The announcement on Monday that the Senate Republican leader, Mitch McConnell, had decided to support a two-year moratorium on Republican earmarks represented a particularly expedient change of heart. It was Mr. McConnell's generation of Republicans that turned earmarks into high political art.


In 1994, when Republicans took over the House, four of the big spending bills had more than 700 earmarks. By 2005, that increased to 8,600 earmarks. Mr. McConnell, as a longtime member of the Senate Appropriations Committee, signed off on most of those bills and was responsible for a sizable number of those items for his state of Kentucky.


The act of taking earmarks away from Congress may reduce some of the most blatant pork in the budget, like a forage-animal research laboratory in Lexington, Ky., for which Mr. McConnell requested $2 million last year. But it won't save $15.9 billion.


Earmarks are used to allocate a small fraction of already approved spending amounts. If the earmark disappears, the money for it goes back into the spending pot to be distributed by the federal or state bureaucracy instead of by lawmakers. Many of these projects are needed. If lawmakers cannot do so responsibly, someone else will have to decide which lock and dam on the Mississippi will be repaired, which highway extension will be built, which military base will get new housing.


The reforms put in place by House Democrats in recent years have already eliminated some of the worst practices. Secret earmarks, which made it impossible to know which member had requested particularly egregious items, are now banned. All House members are now required to post their requests on the Web where voters can judge for themselves whether the spending is outrageous or useful. House members also have to certify that they have no financial interest in an earmark, and spending cannot be directed to for-profit enterprises.


The Senate should embrace the same transparency.


If the parties really care about ending a particularly abusive practice, they should ban the use of earmarks to reward campaign contributors. That might have stopped Representative Don Young, a Republican of Alaska, from directing in 2007 that $10 million be spent on a Florida highway for the benefit of several land developers who had contributed to his campaign.


More transparency. Less corruption. And fewer bridges to nowhere. Those are all laudable goals to embrace. But they won't fix the country's economic problems. Representative Boehner, Senator McConnell and President Obama need to stop posturing and tell the voters their real plans for getting the economy growing again and then cutting the deficit.










The British government has decided to pay former detainees at Guantánamo Bay, Cuba, tens of millions of dollars in compensation and conduct an independent investigation into its role in the mistreatment of prisoners.


The United States still operates the Guantánamo camp, with no end in sight. None of the truly dangerous terrorists there have been brought to justice, while many prisoners are still held who never should have been. The government not only refuses to come clean on this ignoble history, but it is covering up the Bush administration's abuses by denying victims a day in court.


In July, Prime Minister David Cameron announced that there would be an independent investigation into Britain's role in the mistreatment of detainees. On Tuesday, the government announced that it was compensating British citizens who were held at Guantánamo, six of whom filed a lawsuit accusing government agencies of complicity in their detention, torture and incarceration.


Three years ago, Canada apologized and paid compensation to Maher Arar, a Canadian torture victim, following an investigation into how the Royal Canadian Mounted Police mistakenly identified him as a terrorist. American authorities acted on that false information to arrest Mr. Arar and "render" him overseas. Even after the mistake was revealed, they continued to hold him.


The United States has neither compensated victims of illegal detention and abuse nor taken steps to hold the architects of the human rights abuses accountable. Indeed, some of the Obama administration's biggest legal victories have come in shielding Bush-era officials by getting lawsuits brought by victims with credible claims of kidnapping and torture thrown out of court on specious secrecy grounds, without any testimony being heard.


Among the former detainees whom Britain has agreed to compensate is Binyam Mohamed, an Ethiopian-born former detainee with a British right of residency who said that he was tortured after American authorities sent him to Morocco. In September, a federal appeals court dismissed his case on unconvincing security grounds presented by Obama administration lawyers.


It will do no good for this nation's tarnished human rights reputation that at the same time Britain took responsibility for its comparatively minor role in the ill treatment of terrorism suspects, former President George W. Bush was bragging in a new book that he had personally authorized the repeated use of a form of simulated drowning called waterboarding on Khalid Sheikh Mohammed, the accused mastermind of Sept. 11.


At least someone is owning up to the awful legacy of Mr. Bush's illegal detention policies.









DEAR Uncle Sam,

My mother told me to send thank-you notes promptly. I've been remiss.


Let me remind you why I'm writing. Just over two years ago, in September 2008, our country faced an economic meltdown. Fannie Maeand Freddie Mac, the pillars that supported our mortgage system, had been forced into conservatorship. Several of our largest commercial banks were teetering. One of Wall Street's giant investment banks had gone bankrupt, and the remaining three were poised to follow. A.I.G., the world's most famous insurer, was at death's door.


Many of our largest industrial companies, dependent on commercial paper financing that had disappeared, were weeks away from exhausting their cash resources. Indeed, all of corporate America's dominoes were lined up, ready to topple at lightning speed. My own company, Berkshire Hathaway, might have been the last to fall, but that distinction provided little solace.


Nor was it just business that was in peril: 300 million Americans were in the domino line as well. Just days before, the jobs, income, 401(k)'sand money-market funds of these citizens had seemed secure. Then, virtually overnight, everything began to turn into pumpkins and mice. There was no hiding place. A destructive economic force unlike any seen for generations had been unleashed.


Only one counterforce was available, and that was you, Uncle Sam. Yes, you are often clumsy, even inept. But when businesses and people worldwide race to get liquid, you are the only party with the resources to take the other side of the transaction. And when our citizens are losing trust by the hour in institutions they once revered, only you can restore calm.


When the crisis struck, I felt you would understand the role you had to play. But you've never been known for speed, and in a meltdown minutes matter. I worried whether the barrage of shattering surprises would disorient you. You would have to improvise solutions on the run, stretch legal boundaries and avoid slowdowns, like Congressional hearings and studies. You would also need to get turf-conscious departments to work together in mounting your counterattack. The challenge was huge, and many people thought you were not up to it.


Well, Uncle Sam, you delivered. People will second-guess your specific decisions; you can always count on that. But just as there is a fog of war, there is a fog of panic — and, overall, your actions were remarkably effective.


I don't know precisely how you orchestrated these. But I did have a pretty good seat as events unfolded, and I would like to commend a few of your troops. In the darkest of days, Ben Bernanke, Hank Paulson, Tim Geithner and Sheila Bair grasped the gravity of the situation and acted with courage and dispatch. And though I never voted for George W. Bush, I give him great credit for leading, even as Congress postured and squabbled.


You have been criticized, Uncle Sam, for some of the earlier decisions that got us in this mess — most prominently, for not battling the rot building up in the housing market. But then few of your critics saw matters clearly either. In truth, almost all of the country became possessed by the idea that home prices could never fall significantly.


That was a mass delusion, reinforced by rapidly rising prices that discredited the few skeptics who warned of trouble. Delusions, whether about tulips or Internet stocks, produce bubbles. And when bubbles pop, they can generate waves of trouble that hit shores far from their origin. This bubble was a doozy and its pop was felt around the world.


So, again, Uncle Sam, thanks to you and your aides. Often you are wasteful, and sometimes you are bullying. On occasion, you are downright maddening. But in this extraordinary emergency, you came through — and the world would look far different now if you had not.


Your grateful nephew,




Warren E. Buffett is the chief executive of Berkshire Hathaway, a diversified holding company.







On Nov. 4, Anderson Cooper did the country a favor. He expertly deconstructed on his CNN show the bogus rumor that President Obama's trip to Asia would cost $200 million a day. This was an important "story." It underscored just how far ahead of his time Mark Twain was when he said a century before the Internet, "A lie can travel halfway around the world while the truth is putting on its shoes." But it also showed that there is an antidote to malicious journalism — and that's good journalism.


In case you missed it, a story circulated around the Web on the eve of President Obama's trip that it would cost U.S. taxpayers $200 million a day — about $2 billion for the entire trip. Cooper said he felt impelled to check it out because the evening before he had had Representative Michele Bachmann of Minnesota, a Republican and Tea Party favorite, on his show and had asked her where exactly Republicans will cut the budget.


Instead of giving specifics, Bachmann used her airtime to inject a phony story into the mainstream. She answered: "I think we know that just within a day or so the president of the United States will be taking a trip over to India that is expected to cost the taxpayers $200 million a day. He's taking 2,000 people with him. He'll be renting over 870 rooms in India, and these are five-star hotel rooms at the Taj Mahal Palace Hotel. This is the kind of over-the-top spending."


The next night, Cooper explained that he felt compelled to trace that story back to its source, since someone had used his show to circulate it. His research, he said, found that it had originated from a quote by "an alleged Indian provincial official," from the Indian state of Maharashtra, "reported by India's Press Trust, their equivalent of our A.P. or Reuters. I say 'alleged,' provincial official," Cooper added, "because we have no idea who this person is, no name was given."


It is hard to get any more flimsy than a senior unnamed Indian official from Maharashtra talking about the cost of an Asian trip by the American president.


"It was an anonymous quote," said Cooper. "Some reporter in India wrote this article with this figure in it. No proof was given; no follow-up reporting was done. Now you'd think if a member of Congress was going to use this figure as a fact, she would want to be pretty darn sure it was accurate, right? But there hasn't been any follow-up reporting on this Indian story. The Indian article was picked up by The Drudge Report and other sites online, and it quickly made its way into conservative talk radio."


Cooper then showed the following snippets: Rush Limbaugh talking about Obama's trip: "In two days from now, he'll be in India at $200 million a day." Then Glenn Beck, on his radio show, saying: "Have you ever seen the president, ever seen the president go over for a vacation where you needed 34 warships, $2 billion — $2 billion, 34 warships. We are sending — he's traveling with 3,000 people." In Beck's rendition, the president's official state visit to India became "a vacation" accompanied by one-tenth of the U.S. Navy. Ditto the conservative radio talk-show host Michael Savage. He said, "$200 million? $200 million each day on security and other aspects of this incredible royalist visit; 3,000 people, including Secret Service agents."


Cooper then added: "Again, no one really seemed to care to check the facts. For security reasons, the White House doesn't comment on logistics of presidential trips, but they have made an exception this time. He then quoted Robert Gibbs, the White House press secretary, as saying, "I am not going to go into how much it costs to protect the president, [but this trip] is comparable to when President Clinton and when President Bush traveled abroad. This trip doesn't cost $200 million a day." Geoff Morrell, the Pentagon press secretary, said: "I will take the liberty this time of dismissing as absolutely absurd, this notion that somehow we were deploying 10 percent of the Navy and some 34 ships and an aircraft carrier in support of the president's trip to Asia. That's just comical. Nothing close to that is being done."


]Cooper also pointed out that, according to the Congressional Budget Office, the entire war effort in Afghanistan was costing about $190 million a day and that President Bill Clinton's 1998 trip to Africa — with 1,300 people and of roughly similar duration, cost, according to the Government Accountability Office and adjusted for inflation, "about $5.2 million a day."


When widely followed public figures feel free to say anything, without any fact-checking, we have a problem. It becomes impossible for a democracy to think intelligently about big issues — deficit reduction, health care, taxes, energy/climate — let alone act on them. Facts, opinions and fabrications just blend together. But the carnival barkers that so dominate our public debate today are not going away — and neither is the Internet. All you can hope is that more people will do what Cooper did — so when the next crazy lie races around the world, people's first instinct will be to doubt it, not repeat it.








Talk about your misty watercolor memories. What's too painful to remember, we simply choose to forget. The bittersweet story of a preppie for whom things always came too easily and his noodging partner, pressuring with sky-high expectations until that final clash split them apart.


Has time rewritten every line? It's trying, big-time.


Yes, Robert Redford and Barbra Streisand met up on "Oprah" on Tuesday to talk about their 1973 turn in "The Way We Were" as the culture-crossed Hubbell and Katie.


But the more charged reunion was taking place in Dallas at the groundbreaking ceremony for the George W. Bush Presidential Center at Southern Methodist University.


After a period of estrangement and after circling each other with dueling memoirs, a happy W. and a gaunt Dick Cheney were reunited on stage.


"History is beginning to come around," Cheney said with satisfaction. After hailing W. as "classy," Vice acted unclassy. Demonstrating that Bush still cannot control Cheney, the former vice president defied W.'s promise not to mock President Obama.


"This may be the only shovel-ready project in America," Cheney noted sardonically, making fun of Obama's attempts to dig out from under the trillions of debt left by his predecessors.


Together again were the president and vice president who invaded, deregulated, overspent, created a climate of fear and intensified the class divide with tax cuts — all so recklessly that our resources are sapped just as we need to step up and compete with our banker, China.


"I wasn't a very good economic prognosticator," Bush told CNN's Candy Crowley. No kidding.


The pair fell out over the Scooter Libby pardon. Up until that point, Vice had been able to lead W. off various cliffs with faux deference and a good sense of which buttons to push. (W. would do anything to avoid getting labeled a wimp.)


Bush writes in his autobiography that when he told Scooter's old boss that the jury verdict should be respected, Dick stared at him intensely.


"I can't believe you're going to leave a soldier on the battlefield," Cheney said.


"The comment stung," Bush concedes. "In eight years, I had never seen Dick like this, or even close to this. I worried that the friendship we had built was about to be severely strained, at best."


In his book, Bush is respectful to Cheney. He doesn't even mention his vice president's near-deadly aim with a hunting rifle.


But it is telling that W. takes pains to paint his Vice as a mere supporting player, not the huge force for global domination that he was. This conscious diminution of Cheney makes the power struggle in that White House all the more apparent.


W. writes that he considered dropping Cheney from the ticket in 2004, but even that wasn't his own idea. Cheney diabolically suggested it, knowing the Dauphin would refuse.


On the "Today" show interview with Matt Lauer, Bush was asked by an audience member to name his most insightful adviser.


The chagrined ex-president tried to avoid the question at first. It was fascinating to watch the body language of the man who said his decision to invade Iraq relied more on body language than vigorous debate.


When W. did offer a list, Cheney did not immediately pop to mind. Hank Paulson was first. Then Condi, who elbowed Cheney aside. Then Colin Powell, Cheney's nemesis. Then Rummy, Cheney's mentor and partner in dark machinations. And then, finally, when W. could avoid it no longer, he mentioned Vice, damning with faint praise: "Dick Cheney's advice was consistent and strong."


He told Lauer that he was motivated to run for president because of his father: "I wondered whether or not I had what it took to get in the arena like he did." And he writes that one of the motivating factors for sacking Saddam was that the Butcher of Baghdad tried to assassinate his dad.


Yet, despite his father being the measuring stick and prod, he did not keep the former president and foreign affairs expert in the loop on Iraq.


Asked by Bill O'Reilly why he did not like to seek advice from his father — the only other American president who went to war with Saddam — W. offered a nonsensical answer that simply underscored his perpetual fear of being overshadowed by his dad.


"He knew that I had better information at the time than he would have known," W. said, adding that when "the heat" is on "you tend to seek out the advice of the people closest to you." He also talked as usual about how close he and his dad are, which makes the whole thing even weirder.


As Barbra sang on "Oprah": If we had the chance to do it all again, tell me, would we? Could we?








if anyone wondered about the limits of public tolerance for the increasingly unpleasant airport screening experience, the answer is being provided by the reaction to newly installed body scanners and newly aggressive pat-downs offered as an alternative.


This week alone, New Jersey's Legislature passed a resolution saying the scans violate a citizen's right against unreasonable searches. John Tyner, a California traveler who sought a pat-down instead of a scan and then told airport security, "If you touch my junk, I'll have you arrested," became an Internet sensation.

And in the most ambitious and irresponsible protest, two grass-roots groups started the call for fliers to "opt out" of scans and insist on public pat-downs on Nov. 24, the day before Thanksgiving. That's about the worst idea since somebody suggested, "Let's change the formula for Coke." It threatens to create even bigger bottlenecks on what's one of the year's busiest travel days.


More broadly, there's a gaping hole in the critics' logic: None has offered an effective alternative. The body scanners can detect objects that metal detectors miss, such as plastic firearms, ceramic knives and, yes, possibly explosives hidden in a person's underwear — the kind carried by the failed Christmas Day bomber last year. The unspoken conclusion of the critics' thinking is that the government should possess technology that can detect hidden weapons, but not use it because of public squeamishness. Imagine the outcry if a bomber managed to board a plane and bring it down.


In fact, despite the critics' overwrought charges, they are a vocal minority. In a CBS News poll last week, 81% of those surveyed said airports should use full-body X-ray machines. The scanners' invasive aspects have been toned down considerably. Software obscures images of body parts. Individuals can't be identified. The operator who sees the image is in another room.


This is not to say there aren't valid questions about the machines or that the Transportation Security Administration (TSA) can't improve this process. While the Food and Drug Administration has assured the public that the scanners do not pose a health risk, a few scientists question that assertion and have called for more study. Given the millions of people who will pass through these devices, that's a good idea.


More urgently, the government should take heed of the hundreds of travelers who have complained about rude, curt or obnoxious treatment by TSA workers, particularly during pat-downs. Such treatment is inexcusable, and screeners need to be told pronto that unpleasant pat-downs aren't meant to coerce passengers into using the machines.


The government and airlines should do everything they can to make the process less infuriating without compromising safety. This includes reviewing existing policies that have piled up in response to particular plots. Is it still necessary for everybody to take off their shoes? Is 3.4 ounces still the right limit for carry-on liquids? Is it necessary to clog checkpoints by giving fliers big financial incentives to avoid checking their luggage? And is there room for more common sense in the whole process?


As another holiday travel season approaches, airport screening might finally be reaching a tipping point. But before a vocal minority forces the issue, everyone needs to calm down and remember that the security-line indignities are a necessary byproduct of an era in which terrorists remain fixated on blowing jetliners out of the sky.








We Won't Fly urges air travelers to say "I opt out" of TSA abuse on Nov. 24. Travelers should opt out of full-body scanners not only to protect their health and privacy, but to protest the Transportation Security Administration's demeaning new security theater. We can ensure passenger safety without making nude images of our children or groping our grandmas.


For this, TSA Administrator John Pistoleaccuses us of being "irresponsible."


The TSA and the Homeland Security Department, however, are the irresponsible parties. They have deployed untested technology that biochemist Michael Love says"statistically someone is going to get skin cancer from."


They did not properly educate the flying public about their new intrusive security regimen. Passengers thrust into these new procedures report cases of trauma, including flashbacks for rape victims and feelings of humiliation. Homeland Security Secretary Janet Napolitano, a political appointee, irresponsibly misled the nation in a USA TODAY Forum piece Monday, saying the scanners were safe and the genital probings were discrete. They are neither.


Homeland Security has suckered Americans into a false sense of security with scanners of dubious value. It remains to be seen whether they even detect the threat presented by last December's underwear bomber.


Rafi Sela, a leading Israeli airport security expert, recently told the Canadian government: "I can overcome the body scanners with enough explosives to bring down a Boeing 747." Is that the security you were expecting, America?


National Opt Out Day is of vital importance to the nation, despite the risk of flight delays. The traveling public urgently requires education on these new intrusive TSA procedures, education that the TSA has neglected.


Individuals need to be warned of the radiation dangers. Parents need to be aware of the emotional trauma their children may be subjected to from TSA "bad touches."


Air travelers are clamoring for someone to stand up and demand that their basic human dignity be honored. As parents, we have a sacred responsibility to our children to keep air travel safe, trauma-free and respectful of individual liberty. The only irresponsible action would be for us to continue doing nothing at all.


James Babb and George Donnelly, who live in the Philadelphia area, are co-founders of the grass-roots group We Won't Fly.








Picture two scenarios. The first: You could give $50 to a charity that you know, vaguely, helps people with disabilities.


The second: You log on to, a non-profit that helps people with one-time bills, and find a request from a former saleswoman suffering from multiple sclerosis. After losing her job, she burned through savings until she qualified for disability benefits. Now, "things have, physically, deteriorated to the point that I need assistance getting in and out of a (tall!) tub in order to take a shower," she reports. "Of all the things I have had to adjust to, this has been right up there with the worst." She needs $1,700 to convert her tub to a walk-in (and someday, wheel-in) shower. Your $50, banded with other contributions, will help her.


Which scenario makes you more excited to give? If you picked the second, then you'll understand why donors quickly funded this recent request from New Jersey resident Marilyn Assenheim, 58 — and you'll understand the appeal of microphilanthropy in general. Broadly defined as direct interaction between individual donors and projects (with non-profits usually verifying cases and facilitating donations), microphilanthropy — typified by groups such as Modest Needs,, or GlobalGiving — is growing fast. Here's the reason: In a world where people post complaints about companies on Twitter, and hear back in minutes, writing a check to charity and forgetting about it doesn't feel right. People want to have a say in where their money goes and know they are making a difference. Thanks to technology, they can. Not only is this trend more fun for donors, it's good for non-profits overall, since when people know more, they give more — even when times are tight.


Active donors


Of course, long before the era of social media, charities have tried to connect people. When I was growing up, for instance, my family donated to the Christian Children's Fund, which sent us letters from children in Thailand who benefited from its programs. Most of us are happy to help a neighbor with a specific need, and so smart non-profits have always tapped this impulse by broadening the answer to the question of "Who is my neighbor?"


Until recently, though, truly connecting with neighbors in different communities or across the globe has been a complicated process. I remember letters from Thailand arriving on light-weight paper to keep the postage bill under control. Now, you can get regular Facebook updates on what your international friends ate for breakfast. So, if you are charitably inclined, why not choose your own clean water project to fund in, say, Tanzania, and ask for updates along the way?


"There's a lot of evidence that this generation is used to instant access to information," says Ken Berger, president of Charity Navigator, a non-profit watchdog. "They want more direct involvement, to be empowered in the process, and to see results more directly."


"Real" philanthropists like Bill Gates have always gotten this kind of feedback. These days, $50 donors want it, too — to be treated like board members, able to choose their projects and learn about the results.


So in 2000, Bronx high school teacher Charles Best founded, which lets teachers request funds for classroom projects online. In 2001, two former World Bank executives launched GlobalGiving, where donors can contribute to non-profits running international (and domestic) projects that appeal to them. Keith Taylor, a former college professor whose boss helped him when he faced eviction in grad school, founded Modest Needs in 2002. In 2005, microfinance organization Kiva began allowing people to contribute toward no-interest loans to entrepreneurs around the world. Featured when I looked at the site recently? Godfrey Lwebuga of Uganda, who wishes to purchase more chickens for his poultry business. Citizen Effect, which asks individual "citizen philanthropists" to take on larger fundraising goals by tapping their networks, launched in late 2009.


'Here to stay'


These organizations have experienced "phenomenal growth," says Berger; according to Charity Navigator, from 2004 to 2008 (with slightly different fiscal years), Modest Needs grew from $194,379 to $2.7 million in revenue, GlobalGiving grew from $508,653 to $7.4 million and grew from $2.8 million to $18 million.


"Clearly they are here to stay, and are part of the landscape of how people are served by non-profits," Berger says. While these non-profits retain the right to direct funds more broadly, they usually do follow donors' wishes, and always offer follow-up. This transparency, he notes, has pressured the whole non-profit sector to step up its game.


That's good news, because there's evidence that this increased engagement has paid off in making the non-profit sector somewhat recession-resistant. Though large charities (particularly universities and those reliant on stock gifts) saw donations drop sharply between 2008 and 2009, Giving USA reports that, overall, individual charitable donations were off less than half a percentage point.


When you get to hear the whole story, helping people is addictive.


Certainly Marilyn Assenheim's tale is compelling. Asking for help was hard, she tells me, but so was getting in and out of the tub, and so when she learned she'd been approved, she was "excited, shocked, thrilled." In a thank-you letter to the donors who funded her request, she wrote, "The fact that you've gone out of your way, perhaps by sacrificing something you might have wanted yourself in order to do this for me, is humbling beyond words."


Who wouldn't want to read a note like that? No wonder, founder Taylor reports, that 70% of Modest Needs recipients eventually become donors themselves.


Laura Vanderkam, author of 168 Hours: You Have More Time Than You Think, is a member of USA TODAY's Board of Contributors.








The Tea Party-fueled election heralds an era of fiscal responsibility, to be sure. But it also signals a desire to restore America's sense of moral responsibility. If our politicians want to regain the trust of the American people, they will need to address not just matters of the pocketbook — but matters of the heart, too.


To explore this phenomenon, my non-profit organization, American Values, commissioned an Election Day poll from the polling company inc./WomanTrend. Our sample of 834 voters was representative of the broader American electorate. It included, for example, slightly more 2008 Obama voters than McCain voters. And most of our respondents said economic issues guided their votes for Congress. But that was not their only concern.


An overwhelming majority, 77%, felt "things in America are headed in the wrong direction," including 59% who believed "at least part of it is due to the decline of moral and family values in society."


Glimpses of Americans' disgust with our moral climate were evident on Election Day. In an unprecedented vote, Iowans ousted three Supreme Court judges who had foisted gay marriage on the state last year. A majority of our poll's respondents said they'd be "less likely" to support a candidate for office who supports same-sex marriage (including 40% who said they would be "much less likely").


Last year, opinion polls showed for the first time that a majority of Americans consider themselves "pro-life" on abortion. In my poll, 53% held a pro-life position; 41% favored abortion rights.


The most important source of America's pro-life shift has been the government's lurch to the left on abortion. No longer are the most prominent discussions about whether or not abortion should be legal. Today's abortion debate, alas, revolves around whether and to what extent taxpayers should be obliged to pay for other people's abortions. Many self-described pro-lifeDemocrats who voted for health care reform were ousted from office. Interestingly, those who lost went down not defending taxpayer-funded abortion but rather insisting they had voted against abortion funding. (One losing Democrat, Ohio Rep.Steve Driehaus, even sued a pro-life group that ran ads claiming he had voted for taxpayer-funded abortion.)


The Election Day returns prompted Planned ParenthoodPresident Cecile Richards to call Nov. 2 "a difficult day" that produced "truly alarming" results.


Prominent Republicans, including Indiana Gov. Mitch Daniels and Mississippi Gov. Haley Barbour, are advocating that the political parties agree to a "truce" on important cultural issues to focus solely on the economy. That would be nice, but the problem is that some of our politicians and courts have taken cultural issues out of the people's hands by legislating from the bench and imposing their values on the public.


These results should help our political leaders remember that it's far too simplistic to focus on just the economy going forward.


This fact is reinforced by polls showing that most Tea Party supporters are just as culturally conservative as they are fiscally conservative. An October Public Religion Research Institute poll found that 57% call themselves Christian conservatives, 63% think abortion should be illegal in all or most cases and only 18% support same-sex marriage.


As Tea Party visionary Dick Armey has said, "(cultural) issues are too important to be left behind, and they won't be left behind" by the new Congress.


It's easy to conclude, "It's the economy, stupid." But it would be truly stupid for our elected officials to conclude that they can address our government's fiscal deficit without addressing its moral deficit, too.


Gary Bauer is president of American Values and chairman of the Campaign for Working Families.








Education professionals have for years documented and tried to eliminate the huge achievement gaps between white and black students, particularly those in reading and math between young black and white boys. To the chagrin of educators, and despite a clutch of reform initiatives going back several decades, the achievement gap persists.


A new report confirms that. Indeed, its authors urge the White House to convene a new conference on the issue, and have called on Congress to direct increased funding for needy schools and establishment of networks of black mentors.


In the current economic climate it's hard to imagine that Washington will be persuaded to create and fund a new education initiative aimed at minority students. Even at the state level, some Tennessee's lawmakers continue to express skepticism about continuing funding for prekindergarten education programs aimed at minority youth.


If the new report is a realistic indicator, the yawning lethargy in officialdom is counterproductive. The evidence of a social catastrophe already in motion and worsening steadily is too great to ignore.


The report, "A Call for Change" -- issued by the Council of the Great City Schools and based on data from national math and reading tests taken from the National Assessment for Educational Progress -- is too disheartening to ignore. It shows that just 12 percent of black fourth-grade boys are proficient in reading tests, versus 38 percent of white boys who are proficient in reading by that age. Just 12 percent of black eighth-grade boys, moreover, are proficient in math, compared with 44 percent of white boys.


Poverty is not the sole excuse for these discrepancies. Using the measure of whether they qualify for free or reduced school lunches, the researchers found that poor white boys perform as well as black boys who are not impoverished.


The report notably found that black boys generally begin falling behind white boys in their earliest years. That suggests that social factors are a key link in the puzzle of poor academic performance. Black children who perform least well are three times more likely than white children to live in single-parent homes, and they typically live in homes whose mothers have a higher rate of infant mortality. Black children are also twice as likely as white children to live in homes where neither parent has a job.


In high school, black males drop out at nearly double the rate of white males. The average college SAT entrance exam scores for those who remain are nearly 104 points below those of their white counterparts.


These statistics are jaw-dropping, but not surprising. Other studies have shown that more than 70 percent of black children are born to unwed mothers, and that a majority of males who drop out of high school without a diploma end up serving time in prison by the time they are in their mid-30s.


Assessments of the No Child Left Behind law in 2009 also showed that the NCLB law had largely failed to close the achievement gap of blacks and Hispanics versus white students. Moreover, the overall scores of all participants were no better than they had been in the 1970s -- largely because the poorer-achieving minority population who were taking the reading tests, for example, had increased in that period from 13 percent of test-takers to 40 percent.


Ronald Ferguson, director of the Achievement Gap Initiative at Harvard, told a New York Times reporter that researchers had to look beyond poverty to get at the roots of such findings, and have "conversations about early childhood parenting practices" that have been avoided.


He cited "the activities that parents conduct with their 2-, 3- and 4-year-olds: How much we talk to them, the ways we talk to them, the ways we enforce discipline, the ways we encourage them to think and develop a sense of autonomy." That suggests the obvious but often unaddressed models of parenting and family life that can -- and should -- help and inspire children to become life-long learners.


Common-sense would suggest that's at the crux of early learning skills, and life-long achievement. The frequent talk about failing schools, however, typically overlooks this obvious early learning dynamic, and the value of pre-k programs for children whose parents don't know how to provide it. For all the social cost and heartbreak it could avert, it's a problem this nation ignores at our peril.







The bizarre case of Rep. Charles Rangel, the once-powerful New York Democrat finally found guilty Tuesday of 11 ethical violations, shows much that is wrong and little that is right in the way the House Ethics Committee manages its work.


The committee took two years and spent $1.6 million, as a Common Cause official correctly stated Tuesday, "to establish facts that seemed clear at the outset and in the end were not disputed." Even so, the committee's prosecutor gently found that Rangel's egregious financial shenanigans amounted simply to "sloppy" accounting, rather than the crimes of tax evasion and selling political favors.


Common sense suggests the latter is closer to the truth. The accusations against Rangel, first raised two years ago, charged him with failure to pay $60,000 in state and federal taxes on rental income from a beach villa in the Dominican Republic; helping keep a legislative loophole worth hundreds of millions of dollars to an oil company from which he was soliciting a gift of $1 million for a public policy center being built in his honor; and failure to report assets worth hundreds of thousands of dollars on his financial disclosure forms.


The case arose after New York papers reported Rangel wrongly possessed four rent-stabilized apartments in New York City and had improperly reported his income. Yet its tortuously slow progress before the House Ethics Committee made it clear that fellow members of Congress from both parties have little stomach for enforcing ethics rules on one of their own.


Rangel's own conduct defies belief. He promised for months that he couldn't wait for a full hearing to prove his innocence, but kept putting it off. And on Monday, when his hearing finally came, he pleaded for a delay because he had run out of money to pay his lawyers -- and then walked out of the hearing when he was denied a delay. Never mind that he had been instructed months ago to establish a defense fund if he needed it, or that he could have liquidated or mortgaged some of his assets to continue to pay his lawyers.


The 80-year-old congressman's conduct was strange by any standard, but especially so given his 40-year history as Harlem's prominent congressman. For a man who recently chaired the powerful House Ways and Means Committed, his was a conspicuous fall from power.


The Ethics Committee's poor showing is as pitiful as Rangel's unbecoming arrogance and hollow pontificating about the committee's failure to give him a fair hearing. Indeed, he was not fairly treated. In a common courtroom, he might have been sentenced to jail. Instead, he is likely to get just a mild reprimand when the Ethics Committee fixes its weak penalty.







It's no mystery what would happen to you if you borrowed 40 cents of every dollar that you spent -- and then you kept on spending: It wouldn't be long before you were dead broke.


Then why is it that President Barack Obama, a majority in Congress -- and a great many other Americans -- don't seem to realize that we as a nation are headed into disastrous economic trouble because Congress is borrowing 40 cents of every dollar that the federal government spends, even as taxes are too high?


North Dakota Democrat Sen. Kent Conrad, a member of a bipartisan commission charged with trying to reduce our $13.7 trillion national debt, said on ABC's "This Week": "That's utterly unsustainable. It can't continue much longer, so it's got to be dealt with."


But alarmingly, it is still going on! It is not being dealt with!


Without a solution, Conrad said, the United States "will become a second-rate economic power."


No American wants that. But are a majority of the members of Congress ready to make the hard spending cuts necessary to reduce our disastrous increases in debt? Certainly, the public in general does not want higher taxes.


Will we face the economic facts -- and adopt real solutions -- in time? If not, it's no secret where we as a nation are headed.


Some of the things the federal commission has suggested to cut the deficit are not at all popular.


Those suggestions include reductions in domestic spending, cuts to military budgets, very gradually raising the age of eligibility for full Social Security benefits to 69, and ending popular tax provisions, such as one that allows mortgage interest payments to be deducted in income tax calculations. Who has other ideas for reducing irresponsible federal spending?


The problems of too much red ink are painfully clear. But the will to face them is lacking. So the problem is getting worse! And solutions will therefore be harder to come by.







Among the issues the "lame-duck" Congress is expected to address before new members are sworn in next January is a bill that would grant the federal government control over food served in public schools.


The $4.5 billion bill would let Washington dictate what type of hamburger buns schools may use, for instance. And the federal government would decide whether meat in school lunches is lean enough.


Some of the bill's goals are good. Many schools serve meals that are not very healthful, and vending machines are poor alternatives.


Those are good reasons for state governments and local school boards to revise school nutrition standards. But we see no authorization in the Constitution for Washington to get involved. And even if you don't care about the constitutional argument, look at the government's record in education.


The Heritage Foundation notes: "Annual U.S. Department of Education spending on elementary and secondary education ... increased from $27.3 billion in 2001 to $38 billion in 2006, up by nearly 40 percent. According to the department, annual spending on the Title I program to assist disadvantaged children grew by 45 percent between 2001 and 2006. ... Since the early 1970s, inflation-adjusted federal spending per pupil has doubled. Over that period, student performance has not markedly improved, according to the long-term National Assessment of Educational Progress (NAEP), which is designed to measure historical trends."


If federal money has hardly boosted academic performance in public schools, why should we assume that federal spending on nutrition programs will achieve desired health goals?


Nutrition in schools should be set by state and local policies -- though parental and personal responsibility are still the most important factor.


Academy alum raises the bar at Carson-Newman***************************************





It was so long ago, in 1953 as a matter of fact, that most people do not remember when U.S. Secretary of Defense nominee "Engine Charlie" Wilson, who had headed General Motors, got unjust political criticism when he made a correct economic observation -- but one that his political detractors purposely twisted to try to make him look bad.


What Wilson actually said was this: "... I thought what was good for the country was good for General Motors and vice versa."


But Wilson's political critics misquoted him, claiming erroneously that he had said, "What's good for General Motors is good for the country" -- suggesting he was putting the welfare of General Motors ahead of the country's welfare.


Well, what was good for our country was good for GM -- and vice versa.


When our country prospered, GM sold lots of Chevrolets, Pontiacs, Oldsmobiles, Buicks, Cadillacs and other GM products. When GM prospered, that meant lots of good jobs, with GM paying lots of taxes.


But for a number of reasons -- labor union problems over past years, some big changes in the habits of car lovers who used to trade for a new-style car every couple of years, some big economic difficulties, and much foreign car competition -- GM recently has not prospered nearly to the extent that it used to.


General Motors, which has sold lots of cars in China and elsewhere around the world, now finds Communist China's biggest carmaker, SAIC Motor Corp., is negotiating to buy a stake -- about 1 percent -- in GM for about half a billion dollars.


Can you believe it? The Communist Chinese want to buy into American free enterprise General Motors!


Well, among other things, it suggests that the Chinese know good cars when they see them.







For 40 years, U.S. Rep. Charles Rangel has represented the Harlem area of New York. He has been demagogic, embarrassing and personally and politically outrageous in his conduct.


But even his congressional colleagues, who know him well, were shocked when he picked up his papers and strode out of a congressional hearing Monday to avoid facing charges of financial and fundraising misconduct.


The 80-year-old, 20-term congressman left the hearing but by no means resigned. His departure left four Democrat and four Republican congressmen figuratively with their mouths hanging open, as they had prepared to sit as a jury on whether Rangel had violated House rules.


He said he had run out of money to hire defense lawyers -- after paying previous attorneys about $2 million -- and needed time to raise an additional $1 million! The chief counsel for the ethics committee said, "I see no evidence of corruption," suggesting only that Rangel was "sloppy in his personal finances."


Rangel earlier surrendered his Ways and Means Committee chairmanship when he was admonished for taking two corporation-paid Caribbean trips in violation of House rules.


Now, with Rangel absent from the latest hearing, the eight congressmen on the ethics panel have found him guilty of 11 violations. There may be a vote soon by the whole House, which could condemn his conduct, fine him and deny him House privileges.


Is that enough?







NOBODY who understands modern Australia and who reads the Victorian Greens' "policies" could regard them as anything but a grab-bag of irrational platitudes.


"While we export raw commodities, our skills and knowledge often disappear overseas . . . Let's bury our coal-dependent economy in the ground and transition into a new way of doing business. Sustainable living using renewable resources is within reach . . . Abolish all TAFE fees." It would be a good thing for Victoria if no Greens were elected to the lower house on November 27. And it will be good for the nation when the party eventually sinks into oblivion like One Nation and other fringe extremists before it.


That said, the Victorian Liberals' decision to preference Labor and deprive the Greens of the chance to win up to four inner-Melbourne seats could prove a bad mistake for the Coalition.


Liberal Party figures including Jeff Kennett, who would have been pragmatic and listed Labor last, are casting the decision as putting the state's interests ahead of the party. But presumably the Liberals believe it is in Victoria's interests to oust the Labor Party from office after 11 years, so the argument is self-defeating if it helps to maintain the status quo. As Tony Abbott warned at Sunday's Liberal campaign launch, it is not the party's job to save Labor from itself. If the Victorian Liberals need a lesson on the errors and long-term consequences of bad preference moves they should study the Coalition's 1998 decision to preference One Nation in Queensland. The move cost the Liberals six seats to Labor, from which the conservative parties have been slow to recover.


Opposition Leader Ted Baillieu's arguments about giving voters a clear-cut choice and avoiding a hung parliament might resonate with some people, but the decision has increased the pressure on him. Now that it is safer in inner-city Melbourne, Brunswick, Richmond and Northcote, the ALP can concentrate its resources on marginal outer-metropolitan seats. Premier John Brumby has declined to comment on the decision but is probably breathing a little easier. Were the positions reversed, it would be hard to imagine the ALP campaign machine being as accommodating. As Peter van Onselen wrote yesterday, what the Liberals need to decide is what matters more: winning elections or risking defeat while remaining ideologically pure.







DESPITE the controversy surrounding her identity, Roberta Sykes, who died in a Sydney nursing home on Sunday aged 67, was a significant activist for black people at a time they needed to be heard.


Bobbi Sykes, as she was known growing up in Townsville, helped put "black power" on Australia's political map 40 years ago. Her contribution was both symbolic, as one of the founders of the Aboriginal tent embassy outside Parliament House, Canberra, and practical, helping to create the Aboriginal Medical Service in Redfern and working with Mum Shirl, whose autobiography she drafted.


While Dr Sykes was careful to define herself by colour rather than as being indigenous, she was widely believed to have been part-Aboriginal until her white mother disclosed that Dr Sykes's father was an African-American serviceman. The revelation led to controversy in indigenous circles, with Dr Sykes widely criticised, among others, by lawyer Pat O'Shane and academic Gracelyn Smallwood for adopting the Aboriginal snake motif as her own when she entitled her three-part, prize-winning autobiography Snake Dreaming. Dr Sykes's claims that she had grown up in poverty were also disputed by people who had known her, including her stepfather, who insisted she was part of "a normal, middle-class family". Dr Sykes encountered racism at its worst, however. After she was pack-raped by four white men when she was 17, an ordeal from which her much-loved first child, now a successful psychologist, was conceived, Dr Sykes's mother saw to it that the culprits were prosecuted. As their jail sentences were handed down, one of the men screamed to the court: "What the hell! She's just an Abo. She's just a f . . king boong."


Determined to make a mark, Dr Sykes was a complex personality who had no reason to embroider the facts when her intellect and drive were always going to take her a long way. After leaving school at 14 to work as a shop assistant, nurse, dancer and waiter, she was the first black Australian woman to graduate from a US university, earning her PhD from Harvard. Dr Smallwood commended her yesterday for blazing that trail. And for all the controversy over her identity, the judges who awarded her the 1998 National Biography Award said she deserved it on "clear literary grounds." Perhaps Dr Sykes summed herself up best: "I think I'm a chameleon. I have the ability to mirror back to people what they are."






IF Julia Gillard wants to be a great leader in the mould of Bob Hawke or Paul Keating, she needs to grab hold of her government and start jettisoning bad policy from the Rudd era.


Top of her list for review should be the National Broadband Network in its present incarnation. And there are other ideas worth revisiting -- such as the flawed renewable energy scheme -- if Labor is to go to the next election as a reinvigorated, reforming party.


For now, the Prime Minister, despite a feisty performance in parliament this week, leads a government in need of a policy clearing house. Rather than sloughing off the misguided ideas that caused the Rudd government to lose its way, Ms Gillard and her colleagues seem determined to dig in their heels at any cost. In the process, they mistake stubbornness for political courage. They talk of hard decisions and label as reform largely administrative actions, such as a carbon price or water cuts, while failing to argue the truly productive changes needed in areas such as tax. Their reluctance to change course in the face of evidence (such as the higher power prices that will flow from the Expanded National Renewable Energy Target) is not good enough from a government that promised to get back on the rails after dumping Kevin Rudd in June. It is certainly not good enough for a country that cannot afford to take a reform "holiday" on the back of a mining boom and a ready market in China.


Labor's lack of policy depth and its poor performance on the $43 billion NBN have alarmed the nation's policy thinkers and institutions. The support enjoyed by reformers such as Mr Hawke and Mr Keating, as well as John Howard, is being denied this government thanks to its tin ear on criticism of its policies. Communications Minister Stephen Conroy has backed the government into a corner with his rigid defence of the NBN and his refusal to refer the project to the Productivity Commission for analysis. The government suggests there is no time or need for a review of the network, but its real problem, as economics editor Michael Stutchbury writes today, is that based on its previously expressed views, the commission would blow the anti-competitive model out of the water.


The broadband promise helped lock in the regional independents so that Labor could form a government after the last election. But the price in waste and damage to government credibility is high. Ms Gillard should make it clear to Senator Conroy that while it delivered salvation a few weeks back, she is not prepared to die on the NBN altar. She must not allow herself to be dragged down by poor policy inherited from her predecessor or, for that matter, some bad ideas, such as "cash for clunkers", that she came up with herself ahead of the election.


Contrary to critics' claims, The Australian is not partisan in its critique of policy. We supported Labor in 2007 but criticised its Building the Education Revolution -- not because we objected to spending on schools but because we wanted money spent more efficiently. We are not opposed to broadband: we just want a better scheme. We are not opposed to the government: we just want it to do better. Ms Gillard and Wayne Swan must clear the decks and give Labor a chance to be the good government we need.






RELEASED, but not free. Aung San Suu Kyi is able to leave her home, communicate with the outside world, and meet fellow citizens - but she shares the same lack of freedom as the rest of the 55 million Burmese. In her case, her worldwide renown and domestic status as daughter of a revered independence fighter might make the military regime hesitate a little before putting her back in isolation, but she and her supporters are well aware how precarious is their position.

The junta's senior general, Than Shwe, has not released her in order to have his long-prepared transition to an ersatz democracy overthrown by a popular uprising. He and his generals will no doubt be thinking the sweeping election win of their official political party in the tightly controlled November 7 elections replaces the mandate won by Suu Kyi and her National League for Democracy in the genuinely free elections of 1990, an inconvenient result that the military annulled.


His calculation will be that with the limited space given to non-military parties in the new parliament, her release from house arrest will persuade important foreign countries to ''re-engage'' with the government and start easing up on sanctions. Early indications are that Than Shwe has been correct in his thinking. Western powers don't like him or his brutal and corrupt system, but have long been worried by Burma's co-option by China and recently by dubious links with another pariah state, North Korea.


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Suu Kyi could give the West an opportunity to get involved again. She undoubtedly has the charisma to spark another mass uprising, but the outcome could easily be as bloody and unsuccessful as the 1988 student revolt. Her approach now seems to be to apply pressure for reforms, with the outside world helping with the carrot of gradually lifting sanctions. She is trying to point the military towards a retreat with some kind of honour, saying she wants it to rise to ''dignified heights of professionalism and true patriotism''.


She will be operating, though, without any official standing in the political system. Too much patience will see her kudos leach away. Foreign governments should not rush to ease sanctions before some progress can be credited to her and other opposition groups. Canberra should keep up its sanctions against about 400 top military figures and their business allies until they earn some international respectability. If the Burmese government continues to block foreign contact with independent figures and civil society groups, it will be a sign nothing much has been changed by the elections.







THERE is an element of deja vu to the proposal to explore beneath Sydney for coal-seam gas. Apollo Gas intends to drill a first exploratory bore beneath a disused industrial site in St Peters. The company, which has a lease to explore for gas over much of the metropolitan area, is following where others have gone before.


The Sydney basin - from the Hunter to Batemans Bay - contains vast reserves of coal which have been known of since the 18th century. Coal was mined underneath Sydney Harbour, with the pithead in Birchgrove on the Balmain Peninsula, from the 1890s. But the mine was deep and dangerous; the quantity of coal effectively available was insufficient to sustain a profitable operation for long, and the mine closed in 1931. But subsequently the site was drilled for gas, which is present in economic quantities in Sydney basin coal seams. Gas was produced for some years reaching a peak of more than 11 million cubic feet in 1944, before declining quickly. The operation closed in 1950.


It is the choice of the site for the operation's surface workings, though, which is relevant to Apollo Gas's hopes today. According to the NSW Department of Primary Industries, the operating company's first exploratory drillings were in Cremorne. Once coal was found, it considered Kurraba Point, Balls Head, and two sites on Bradleys Head, one near Little Sirius Cove. But the owners of nearby property objected so strongly to the idea of a coalmine that the company was forced to move its mine head to working-class, industrialised Balmain. The attractions of a working harbour had clear limits in the 1890s; nimbyism was as potent a force then as now.


Coal-seam gas is claimed to be cleaner than coal: burning it produces about 57 per cent of the greenhouse emissions produced by coal for the same energy output. But some have questioned whether this is the whole story: far more emissions are produced in obtaining coal-seam gas, and through leakage. These, along with other emissions, reduce its environmental appeal. We have argued before that the process used today to extract gas from coal seams - hydraulic fracturing, or fracking - should not be used beneath Sydney's water reservoirs because it could contaminate groundwater flowing into them. The argument has less force in the metropolitan area, but other factors apply. Any company prospecting for coal-seam gas may well find, like its 19th-century coalmining predecessor, that it is hard to hide its surface operations, and when the neighbours find out about them, they object.







POLITICAL campaign launches are increasingly marked by - and marred by - the adulation of leaders and a diminishing emphasis on policy. The launch of Labor's state-election campaign in Bendigo yesterday was no exception. The focus was on Premier John Brumby, his qualities as a leader and his affinities with the area. The audience was regaled with tales of his past associations with Bendigo as an Eaglehawk schoolteacher and his more recent return as a part-time farmer with environmentalist leanings. And when Mr Brumby rose to speak he largely confined his remarks to one policy area, education, announcing policies on kindergartens, the teaching of life skills for year 9 students in government high schools, and skills training for apprentices. There was also a promise to create 300,000 new jobs for Victorians. But that was it. Other major policy areas, such as health or public transport, were dealt with by cursory mentions of what has already been announced: new hospitals, or the $38 billion Victorian Transport Plan.

Mr Brumby did not say what the 300,000 new jobs would be, or how or where they would be created. He merely assured Victorians that they would appear over the next five years. The educational initiatives he announced were all laudable, and as the Premier and other speakers kept pointing out, they have been costed, unlike the policies the opposition has announced so far. The announcements all fit into a traditional Labor emphasis on education as the key to equality of opportunity. They do not, however, amount to an expansion of the school system itself, or a substantial investment in lifting teaching standards.


The government proposes to spend $100 million over the life of the next Parliament to create 10,000 new kindergarten places - an appropriate response to the baby boom. There would also be 1000 new early intervention places for preschool children with disabilities or developmental problems. Also to be implemented over the parliamentary term, but aimed at the other end of the educational trajectory, the government aims to increase the number of apprentices finishing their training by 4000. Apprentice tuition fees would be frozen until the end of next year, and all apprentices starting during the next two years will be admitted to trade schools regardless of their prior qualifications.


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The centrepiece of Mr Brumby's new era in education, however, is likely to strike many parents and teachers as underwhelming. The Premier says that Education for Life: the Year 9 Experience is intended to ensure that every student in government schools gets opportunities that at present are guaranteed only to students at the wealthiest private schools. All the activities to be included in the one-term program are worthwhile, and should indeed be included in the course of a normal school education: training in self-discipline, first aid, water safety, bushfire awareness, and drug, alcohol and mental-health education. These programs with an out-of-school emphasis are to include what the Premier described as a minimum two-week living away from home experience. In other words, a school camp. None could deny that these life skills are important, and it is hardly a bad thing that the government is entrenching them in the curriculum. But entrenching them is essentially what the $208 million program would do, for in few schools would such programs be complete innovations. At least some of the skills to be taught in Education for Life are already familiar items on the school agenda for many students, and not just those who attend wealthy private schools. If Education for Life is a product of the government's most creative thinking, then it is a sign that the government has begun to run out of ideas.


Victorian Labor is not unique in reducing its campaign launch to a few brief policy announcements packaged in hoopla and hokum. Both major parties relied on the same formula during the federal campaign, and the Victorian Coalition did so in its launch at the weekend. There is no comparison, however, between the most notable announcement at that event, the Coalition's plan to create a public transport authority, and Mr Brumby's proposal for a life-skills curriculum. The latter proposal mandates and consolidates what is already being done in many schools and extends such programs to schools that have yet to implement them. The quality of education offered by government schools will no doubt be enhanced by Education for Life, but it is an incremental improvement. The Coalition's transport plan, however, is a new plan intended to remedy the fundamental defect in the public transport system, the lack of competent and responsible oversight of it.


Neither Labor nor the Coalition can be judged fit or unfit to govern on the basis of a single policy. Their respective campaign launches, however, have hardly given voters much more than that.








The country presents itself as a modern liberal democracy yet has an autocratic political culture


Singapore is proud of its place near the top of many international rankings. Its school system is by some measures the world's best. The island state promotes itself as diverse, competitive and cultured – an exciting global hub. But there are two league tables which shame Singapore. The first, compiled by the campaigning group Reporters Without Borders, places the country 136th in the world for press freedom– below Iraq and Zimbabwe. The second is the rate at which Singapore executes convicted criminals: arguably higher, per capita, than any other country in the world.


Singapore presents itself as a modern liberal democracy: it has a parliament, elections, courts, a constitutional right to free speech and the consumerist gloss of capitalism. Its citizens are free to become rich and to travel. Many do both. The country has by any measure succeeded since independence. But its autocratic political culture – overseen by the country's founding father and now official minister mentor Lee Kuan Yew– is highly and needlessly restrictive. The media is largely state-owned. Defamation and contempt laws threaten dissent. The latest victim of these is Alan Shadrake, a British-born writer sentenced yesterday to six weeks in prison and a large fine after being found guilty of contempt of court. His book Once a Jolly Hangman questioned the independence of Singapore's legal system, and its use of the death penalty.


It is depressing that a country as successful as Singapore should feel the need for such restrictions on free speech. Singapore argues that, without them, the balance between the country's Chinese, Malay and Indian populations would be upset. But the reality is that other successful parts of Asia – Hong Kong and Taiwan, for instance – have thrived by extending free speech and the rule of law. Singapore is making itself a less significant place by refusing to give its people the sorts of freedoms that are routine elsewhere.


On a practical level, the decision to prosecute Mr Shadrake was also foolish. His book has had far greater attention because of it, and Singapore's reputation has been harmed. Mr Shadrake is quite right to attack a criminal justice system whose victims are often poor migrant workers. His book was legitimate and – despite the court's claim to the contrary – largely accurate. The suspicion is that the Singapore government resented the exposure of a squalid system of routine executions which sits uneasily with the image it likes to present to the world. Singapore wants to be judged as a first-world nation. It must find the confidence to allow its citizens the freedoms that go with that status. Repression is not the route to success. In the end, it will prove its enemy








The Guantánamo complainants get a very large payout and the government gets the protection it craved against disclosure


There were two ways of trying to resolve the hugely serious allegations made by some 16 UK former terror detainees in Guantánamo Bay. The first way was to allow the detainees' complaints about the UK's alleged role in the rendition of suspects after 9/11 and its alleged complicity in torture to be litigated in court to the bitter end. In that case, any eventual findings on liability would perhaps then be followed by criminal proceedings and by further civil actions stretching far into the future with, a long way down the road, an official inquiry. That way, as experience inNorthern Ireland has shown, might take anything up to 40 years to complete. The second was simply to cut a deal now, with the detainees accepting a big payout from the UK government, with a line drawn in the sand on both sides and no withdrawal of either the complaint or the response. In the event, the two sides have abandoned the former course and accepted the latter. Their decision is bad in many ways for accountability and justice. But it is practical politics and, subject to conditions, it is probably the best second best way to proceed.


Yesterday's announcement by the justice secretary, Kenneth Clarke, confirms that the coalition government's intention to cut a deal, laid out by David Cameron in July, has now been partially fulfilled. The Guantánamo complainants get a very large payout – exactly how big is not clear, but some detainees are said to be in line for sums of at least £1m. They also get the inference, even though no such thing has been conceded by the government, that the UK accepts some liability. In addition, they get the prospect that the government's promised inquiry by Sir Peter Gibson into the UK's involvement in the mistreatment of detainees will take place sooner rather than later – though this remains uncertain because of other police investigations – and that the fact of and findings of the inquiry will strengthen the coalition's public determination for such involvement never to happen again.


The government, on the other hand, gets the protection it craved against disclosure in open court of many tens of thousands of classified documents. Not only does this relieve MI5 and MI6 of months of work on the documents and legal arguments about what and how much should be handed over. It also, absolutely crucially from the intelligence and UK government points of view, means that London can now tell Washington and other allies that names and details in their shared secrets will not in future end up in British courts. These are benefits for which Mr Cameron is willing to pay millions of pounds of taxpayers' money, at a time when public funds are otherwise being slashed on all fronts, not least in the legal budget. But they are umbilically linked to the intention, repeated by Mr Clarke yesterday, to publish a green paper next year, with legislation to follow, which will massively tighten the terms on which intelligence information can be disclosed in courts. Pressed by the senior Conservative backbencher Richard Ottoway yesterday, Mr Clarke made clear that he intends these restrictions to apply not just in civil cases, like the Guantánamo case, but in criminal cases and in inquests like the current 7/7 case too.If the government gets its way, there will be a long-run trade-off. In return for fresh official commitments to put torture and complicity more firmly than ever beyond the pale, ministers intend to place the detailed anti-terrorist work of the intelligence and security services much further beyond legal scrutiny than it currently is in the light of recent court rulings. There is no getting away from the fact that this is a mixed and uneasy way of moving on from a grim episode. Serious liberals, who recognise that national security has a place within the rule of law, must examine the green paper next year with care to ensure the compromises it proposes are compatible with law and freedom.







The best television screenwriter around should be applauded and defended from the charge that he is being unpatriotic


For drama to be deemed safe, it's best if it is about the past. Jimmy McGovern, the best television screenwriter around, has been attacked by Tim Collins, the colonel who became a celebrity for a rousing address to his troops on the eve of the Iraq war. What drew the retired colonel's ire is an episode to be screened next week in the current Accused series about the consequences of two squaddies disobeying orders inAfghanistan. He called it irresponsible and desperate to shock. He said the drama abjectly failed soldiers who were risking their lives on the frontline. McGovern got the same treatment for his drama about Bloody Sunday, which was also accused of being one-sided, selective with the facts, and over the top in its depiction of violence. Eamonn McCann, one of the organisers of the civil rights protest, wrote at the time of the film's first screening that the hostility to it – and to another television drama on the same events by Paul Greengrass – arose not from concern for the truth, but from an unwillingness to acknowledge it. After the findings of the Saville inquiry few would now say that McGovern's drama Sunday was particularly overstated. Those events are long gone, but the war in Afghanistan will drag on for some time. Do we have to wait three decades before it creates drama that is challenging to watch? McGovern should be applauded and defended from the charge that he is being unpatriotic. Viewers should decide for themselves where the truth about this conflict lies, and who is being patriotic about telling it.









On Sunday, at least 2,000 people turned out for a demonstration in defense of the Tsagovsky forest. This was in Zhukovsky, a city of roughly 100,000 people. That means about one in every 50 took part.


A June 17 protest against the construction of a silicon plant in Abakan — population 160,000 — drew 5,000 to 7,000 people. In other words, about one in every 30 people protested. What's more, 40,000 residents — one in every four people — signed a petition demanding a halt to construction of the plant.


On Oct. 30 in Nizhny Tagil, 1,000 people gathered in support of anti-drug crusader Yegor Bychkov. With a population of 370,000, one in every 370 residents participated.


On Feb. 13, more than 2,000 of the 570,000 residents of Irkutsk staged a protest against billionaire Oleg Deripaska and in defense of Lake Baikal. That comes out to one in every 285 people.


With a population of 420,000, Kaliningrad was the site of a major demonstration on Jan. 30 in which 10,000 people protested a 25 percent hike in transportation taxes and called for the ouster of Governor Georgy Boos and Prime Minister Vladimir Putin.


Now let's compare those figures with the rallies held in Moscow, a city of roughly 15 million people. The monthly Dissenters' Marches initially drew several hundred participants, but that number has slowly climbed to the current level of 1,000 to 2,000 people per march. On Nov. 14 — the same day of the 2,000-member rally in Zhukovsky — a mere 600 to 700 Muscovites gathered in support of journalists who been beaten, including well-known Khimki journalist Mikhail Beketov and Kommersant correspondent Oleg Kashin. Another rally in support of Bychkov held in Moscow a week prior to the rally in Nizhny Talin mentioned above, drew far fewer participants.


These events illustrate two points. First, people are concerned not about large, abstract principles, such as freedom of speech, but about specific problems that affect them directly: the Tsagovsky forest, a silicon factory or transportation taxes. Incidentally, the Boston Tea Party was not a protest against a restriction of freedoms but an expression of outrage over unreasonably high taxes on tea. In a similar fashion, the recent wave of protests in Russia has been sparked by anger over very concrete injustices affecting local residents.


Second, this shows that democracy does not mix well with overpopulated megalopolises. This is true for almost all societies at all times. The residents of bitterly cold and sparsely populated Iceland gathered in the country's national parliament, those in the frosty climes of medieval Novgorod had their veche, or council, but the people of the overpopulated historical cities of Babylon or Luoyang, a cradle of ancient Chinese civilization, had no such councils or parliaments.


Democracy cannot thrive in the absence of social cohesion or a shared sense of community. Any small city in the world is really a large village where everyone knows one another. By contrast, a gigantic metropolis such as Moscow is atomized into a collection of millions of individuals, all largely disconnected from one another. Worse, the horrendous traffic jams make attending a demonstration an all-day affair for Muscovites.

The Kremlin can take some comfort in the fact that Moscow's overpopulation, horrendous traffic jams and the isolation of its residents guarantee the stability of the ruling regime.






5 Ways to Bring NATO and Russia Together

By Oksana Antonenko and Igor Yurgens


On Friday in Lisbon, NATO will adopt a new strategic concept identifying its purpose and priorities for the decade ahead. The credibility of this exercise will be significantly boosted if a day later NATO and Russia can agree on a bilateral strategic concept of their own, paving the way for a genuine transformation of NATO-Russia relations, free of empty declarations and rhetorical overtures.


Such a NATO-Russia concept should foster a mutual commitment to eliminating false perceptions of threats that Russia and NATO pose to each other. At the same time, it should develop effective practical tools for cooperation in addressing common threats and challenges wherever these could emerge in the future. In essence, Lisbon should propel NATO-Russia relations on a steady, predictable and sustainable trajectory of integration between these three actors within a common Euro-Atlantic and Eurasian security community.


Such a community, first envisaged by the forefathers of post-Cold War Europe and recently reaffirmed by President Dmitry Medvedev in his vision of a new Euro-Atlantic security architecture, has failed to take root two decades after the fall of the Berlin wall. Yet, a strategic landscape shaped by post-financial crisis austerity measures, declining defense capabilities and dwindling public support for future expeditionary operations all reinforce the need for a reworked security community.


At present, NATO and Russia seem more like reluctant neighbors than committed partners. Practical cooperation between them remains limited even by the standards of the 1990s, when they conducted joint operations in Balkans. Their level of inter-operability and trust remains low.


To address these challenges a NATO-Russia strategic concept should include five elements:


1. Adopt multilevel confidence-building measures that focus on reviving important transparency elements of the Conventional Forces in Europe Treaty. This should include devising special multilateral confidence-building measures, normalizing Russia's relations with all of its neighbors based on the examples of the Russian-Polish and Russian-Norwegian normalization. Both NATO and Russia should stop conducting major military exercises along their borders. NATO should seek to provide credible security reassurances for Central and Eastern European NATO members, not through Cold War-era type contingency planning against a nonexistent Russian threat, but through confidence-building measures with Russia.


  1. Initiate practical cooperation on one of the key strategic issues of the day — missile defense Russia should
  2. participate fully at all levels of cooperation between the United States and its European allies. Moreover, Russia and the United States should go further in devising elements of a global system outside Europe. Joint-threat assessments should be complemented by information sharing and technological cooperation.


3. Expand cooperation on developing a regional security system for Afghanistan and its neighbors. Russia and NATO share common concerns over developments in Afghanistan, particularly within the context of current efforts to bring about a strategy of political reconciliation among different Afghan groups and preparations for a viable exit strategy for the NATO-led coalition forces. Russia is already contributing to NATO operations by providing land routes in the north through which almost 50 percent of all nonlethal goods are currently supplied to coalition forces. NATO and the Collective Security Treaty Organization should establish cooperation by developing a viable counter-narcotics strategy for the region. Moreover, Russia should participate in discussions centered on a sustainable regional approach to Afghanistan once coalition forces leave the country. Moscow should also continue its role in  training and supplying the Afghan army and police.


4. Upgrade the level of inter-operability between NATO and Russia. This can be done through expanding military-to-military programs, including regular consultations and joint exercises. Russia's comprehensive transformation of its armed forces offers an opportunity to enhance inter-operability with Western militaries. U.S. and European forces have provided a model for many aspects of Russia's military reforms — from establishing a professional noncommissioned officer core to help the transition to a more devolved command structure. Russia and NATO should also increase joint educational programs. With a two-year pause in Russian military educational enrollment, the moment is ripe for educational and language exchange programs for Russian instructors at leading Western military institutions. This would allow for a new generation of Russian and NATO officers to better understand one another. Finally, NATO should rethink its reservations about military-technological cooperation with Russia, initiate much greater cooperation on joint systems and welcome Russia's procurement of Western technology and platforms for its domestic modernization needs. As it stands today, roughly 30 percent of the modern weapon components procured by Russia's armed forces are supplied by foreign manufacturers.


5. Reform the NATO-Russia Council to transform it into a truly integrated body in which all members are comfortable to participate in their national, not bloc-based, capacity and which is both mandated and able to make joint decisions on issues of mutual concern. First, the NATO-Russia Council should be renamed to bring it more into line with the intended format at 29, rather than 28+1. Moreover, if NATO members agree to transfer several areas of its policymaking functions, such as anti-piracy or humanitarian operation, this will help turn the NATO-Russia Council into a mechanism for addressing real issues instead of simply a tool for managing NATO's relations with Russia.


Lisbon presents a unique opportunity for achieving a qualitative improvement in NATO-Russia relations. The two today share more common threats and challenges than ever before, and both sides see their resources and capabilities reduced. At the same time, the "reset" in U.S.-


Russian relations and the improvement of


Russian-Polish relations present a new, positive atmosphere in which practical cooperation can be taken to a higher level.


The question of eventual Russian membership of NATO will continue to loom. Strong practical and political arguments have been marshaled in support and in opposition to the proposition. Viewed against present realities, the question may seem to retain a long-range, almost abstract character. But real penalties of a political and diplomatic kind would be incurred in closing off the debate. Pragmatic cooperation that has intrinsic value in its own right would at least ensure that the debate could more plausibly be carried forward in a cooperative context.








Right from the start, the latest Russian spy story resembled the stuff of which Soviet spy legends are made. We have a main hero — an intelligence agent who refuses to buckle when tortured.  We also have a traitor who meets face to face with the hero in his prison cell. Last week, we may have learned the name of this traitor. Depending on which media report you read, it was either Colonel Shcherbakov or Colonel Poteyevwho revealed the 11 Russian "illegals" working in the United States.


Betrayal has always played a prominent role in the mythology surrounding Soviet intelligence. As former head of the Foreign Intelligence Service, Yury Kobaladze said on Channel One on Sunday, it was the traitors — not the intelligence service — who were to blame for the recent failure in the United States.


There are two main reasons why this spy flap — like every other one before it — was so blatantly misrepresented by the Kremlin and state-controlled television.


First, by dumping all the blame on the traitor, the authorities can save face. The 11 illegals were highly qualified and trained, we were told. They could have completed their assigned tasks in the United States were it not for the traitor who betrayed Russia and gave them away to U.S. authorities. The spy fiasco was flipped on its head and spun as a huge success: The agents "penetrated" U.S. society and duped the naive Americans for more than 10 years. In this way, the Kremlin and media can assure the majority of Russians that the country is still a superpower whose intelligence services are just as good, if not better than, its arch-rival, the CIA. That is why Prime Minister Vladimir Putin sang patriotic songs with the 10 agents sent back to Russia and why President Dmitry Medvedev gave them medals for outstanding service to the motherland.


Of course, the real state of affairs within the Foreign Intelligence Service, or SVR, is much different. The SVR is the only branch within the country's intelligence operations that was never revamped. When the division broke off from the main intelligence service in the early 1990s, this was the start and end of its "reforms." As a result, the traditional Soviet intelligence methods, which were first developed in the first half of the 20th century and are still largely employed today, never underwent any critical review.


Soviet intelligence enjoyed its greatest successes in the 1930s and 1940s. The largest spy heroes of this period — including the Cambridge Five and Julius and Ethel Rosenberg — contribute to the mythology surrounding the Soviet Union's intelligence capabilities. But the real reason for these successes is tied directly to the Communist International, or Comintern, an international organization uniting enthusiastic supporters of communist ideology from around the world. Soviet intelligence had a huge pool of influential leftist intellectuals from which to recruit. It was this factor more than anything else that led to their dizzying successes from the 1930s to 1950s.


But after Stalin dissolved the Comintern in 1943, Soviet intelligence had to create a special academy to prepare secret agents for work in foreign intelligence. The main goal was to replace former Cominterists with home-grown cadres — secret agents who were planted in foreign countries to assume local identities. But the return on investment from these illegals was virtually zero. In most cases, the best they could do was disguise themselves as small businessmen, and they had no  access to influential Americans with valuable — much less classified — information.


Now, nearly 70 years later, the continued use of illegals is an absurd anachronism. In fact, Russia is the only country still using this practice. The latest spy flap is a case in point: The illegals spent 10 years mostly attending think tank conferences and parent-teacher meetings and were unable to produce any information of value to the SVR.


Since the 1960s, the decline of Russia's intelligence operations has been exacerbated by corruption and nepotism. The children of senior party leaders used their residency in the United States or Western Europe as an excellent springboard for their careers, or simply as a comfortable place to live. The remarkable successes of recruiting FBI agent Robert Hanssen and CIA agent Aldrich Ames are clearly exceptions to the rule. By the beginning of the 1990s, Soviet intelligence was in such deep crisis that KGB party functionaries defected in droves to the West, taking with them detailed lists of their colleagues.


The problem is that Russia doesn't learn from its mistakes. Nothing has been done in the past 20 years to re-evaluate SVR methods or question the sense of using severely outdated methods of gathering foreign intelligence.


In the 2000s, the Federal Security Service took control over internal security systems used by intelligence services — with the exception of the SVR. With the discovery of the mole who disclosed Russia's secret agents operating in the United States, this may give the FSB the foundation it was looking for to extend its control over the Foreign Intelligence Service as well.





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