2009 - a year that was

Ok, almost everyone chronicles the past year. On thing I like, is the one liner event history that figures on Wikipedia or the year round-up in the economist. But for me, the events come to mind at the top of my head at the end of the year, hold most consequence. Here's the roundup of things that defined the past year -

This year marked many things. It began with a bush fire in Australia and surprisingly ended with one in the same place as well - almost setting the tone for the fiery year in politics and the world ahead. Barack Obama became the 44th US President - after a well crafted, technologically and ideologically vibrant campaign. Although post election a number of factors have called into question the success of his presidency. Parleys on whether we were looking at a recession, or a depression, or whether countries like India were in a recession at all, occupied intellectual coffee table talks for a greater part of the year, while countries like Iceland collapsed, Dubai stared at sovereign default in the face, China boosted spending and India recorded 7.9% GDP growth.

Some things stayed staid, with a miscarriage of democracy in Iran and Afghanistan, which felt as though democratizing the Middle-East, an area famous for its tribal population suddenly were forced into something that they did not know how to handle! The Israel - Palestine conflicts continued. Zimbabwe saw the semblance of order with the power sharing deal to form a government, before a deadly car crash wounded the new President and killed his wife. The LTTE was finally defeated with the death of Prabhakaran, thus ending decades of civil war in Sri Lanka, opening a new can of worms related to human rights violations, displaced Tamils and alleged excesses by the Sri Lankan army. The Air France flight from Rio crashed into the middle of the Atlantic in one of the worst air crashes in history, killing all of 228 on board. The UNESCO launched the World Digital Library. Michael Jackson is gone - the music scene will never be the same ever again. This year also marked the 20 year anniversary of the fall of the Berlin Wall, which was much less the fall of an Iron Curtain, as it was the triumph of capitalism over communism.

Typhoons and hurricanes continued. India saw drought in the first half of the year followed by terrible floods in South India that almost wiped out portions of age-old villages. Climate change was becoming a reality and countries had to act really fast. Copenhagen came along, resulting in an eyewash of a climate treaty, which many hailed as at least a step in the right direction. Whether tangible benefits would come out of it, or whether the 'cold' war on who needs to blink first between the developed and the developing world would continue remains to be seen.

Sport faced several disgraceful moments with Lewis Hamilton and McLaren caught spying on Ferrari's technical documents, Flavio Briatore and Nelson Piquet Jr caught in crashgate, only to be topped by the great Tiger Woods proving he loved something more than the 18 holes of golf! Then again, the FedEx - Nadal duel got better, with Fed-Ex snatching sweet revenge thanks to an out of form Nadal. The Indian cricket scene never looked better, but the overdose of the willow implied that cricket now became almost akin to a 9-5 corporate job, with weekends off!! And then came the icing on the cake - the final and sure return of Michael Schumacher to competitive racing, thrilling several Schumi fans across the world.

2010 is not just a new year. It marks the start of a new decade. A decade that began with a promise post Y2K, saw the rise and fall of several governments, terrorism rise to its peak, economic crises of enormous proportions, a new Pope, an American President from a minority community, Saddam Hussein, Benazir Bhutto gone, shards of democracy in the middle east, strife in Pakistan, growth in the BRIC nations, the sudden rise and rise of China, the lost decade in Japan and a lottttt more. I could go on and on, but I'd perhaps reserve all that for another post. That said, hopes abound for 2010. Hope the economic downturn swings into an upturn. Hope there is peace in this world, with none of the disgruntled nations engaging in conflict. Hope that the blue moon that showed its face in India yesterday heralds a new beginning for everyone. Happy New Year everyone!

How much is too much?

They say that a sinking ship exposes the rats on board. Likewise, it takes a crisis to expose fraudsters and unethical entities who thrive on a system while it flourishes. So the Madoffs, Rajus, Kenneth Lays and Thains of the world come into the open only when the system is drained of all the water that had been providing refuge to their unethical activities for so long. Almost all of us know what ethics are all about. Soon after the financial crisis began, people raised a finger against B schools, saying that a code of ethics is missing amongst the current breed of profit-seeking, dollar-hungry set of B school products. And so, most big B schools embarked on a mission to rethink their offerings to prevent unethical entities from entering the system.

Yes, schools do have a role to play in shaping individuals. That is why we had penalties in school for cheating on an exam. That is why we had harsh punishments for cheating in sport at school. But all humans are presumed rational, and we all know the distinction between right and wrong. A school can give us a code of ethics but internalizing it and making the distinction between what is acceptable and what is not, is a confluence of the ethics code and our own ethical appetite. We all wenr in arms when we heard about the fraud committed by Ramalinga Raju. We all watched with disgust as the crookedness of Bernie Madoff came into the open. We exclaimed how brazenly unethical their acts were as the swindled millions and millions of dollars. These were huge transgressions. But think of this. You break a traffic signal, and the cop stops you. How many times have you given a bribe just to get out of the situation fast? Why? Isn't bribery a form of corruption? And isn't corruption unethical? But then, this was a minor transgression, and a small bribe never killed or hurt anybody, right?

But who is to decide what is major and what is minor? And how difficult is it to make the move from good to bad, like the transformation of Anakin Skywalker to Darth Vader? Another point to ponder is that what am I to do if everyone around me is involved in an unethical practice, to book gains? By being ethical, I clearly end up losing. So, should I adopt the rational approach of maximizing my economic value or should I revert to the conscientious approach and believe in a cosmic justice and be satisfied with my being able to sleep peacefully at night, my losses notwithstanding?

I definitely do not have the right or wrong answers to these points. Because actually these are all decisions steeped in shades of gray. At the end of the day, it is a weighted average of your basket of priorities and only you are the judge of the weights to be accorded to each priority to come to a decision metric. The only argument I have is that quick gains are seldom ever sustainable and for me personally a spiky chart is worth much less than a steady level of success and satisfaction.

Power, Politics, Success and Excess

Lord Acton said, 'Absolute Power corrupts absolutely'. I couldn't agree more. And I somehow see some correlation between power and success. Now which follows the other is purely subjective, since some argue that success corrupts a person by making her believe that she is invincible and her confidence alone makes her feel powerful and so wield power. Some others argue that when power is on your side, success verily follows since the power to tilt balances in your favor lies with you. Regardless of which explanation we choose, one must really watch out for the event when power in success moves over to power in excess.

Take China. Undoubtedly she is a superpower. And rightfully so. She has taken all the right decisions, made the right economic moves at the right times. At a time when the world is grappling with dwindling exports, she still registers positive GDP growth. This is power and success. But push the lever a bit further and China presently sits on 2.1 trillion dollars of foreign reserves. The world wants the Yuan to be revalued. The world wants a level playing field, where market forces dictate export competitiveness, not Governmental controls which choose arbitrary exchange rates. But given China's power in the T-bill market, no one dare push her too hard. Now that is power in excess.

Take China again. Post the second World War, when the UN came into being to prevent hostile take overs of other countries' territories, people felt that there would never be anything like the rise of the third Reich. But take India and China since 1962. The bloody Sino-Indian war, where India lost a portion of it North Eastern part of Kashmir. And now, with the Chinese Government going all out to claim ownership of Arunachal Pradesh, Chinese Troops entering Indian territory and painting rocks red, dam construction on the Brahmaputra (which the Chinese bluntly deny... well, I wonder how can someone fudge satellite images then???), it really feels like a push of power to the side of excess.

But then again, economic might can do many things to many people. It is up to an economic power to exercise restraint and be responsible, since those one bristles on the way up are sure to keep watching and waiting on one's way down.

Confucius and Climate Change

The weather is beautiful. The skies are cloudy, the winds are cool. The atmosphere is absolutely intoxicating. The fresh smell of rain-soaked mud, the pitter-patter sound of raindrops, everything 'perfect' in the eyes of a romantic.

Would have been perfect, if only such a weather had existed in July, rather than October in Mumbai.

2009, was declared a drought year. Cut to June- July 2009. Crops failing for want of rain, pictures in newspapers of farmers looking skywards, expectantly, all portrayed an image of the India of the 1950s. It looked rather sad, since those vivid images were a stark contrast to the image of emerging India that we generally perceive.

Cut to October 2009. A deluge in South India. A catastrophe that has not been encountered for over 100 years. Villages submerged, people dead, crops devastated, the rice bowl of India affected adversely. Before I was to leave Hyderabad, I was not too kicked about leaving behind a perfectly cool climate, to come to Mumbai, which I knew would be in her 'midsummer blues'. But I was also relieved to finally be able to travel at a time when there would be no flight delays thanks to bad weather in Mumbai. And surprise surprise, all such expectations were killed, when we were told that BAD WEATHER in Mumbai had delayed the incoming flight. All of us were stumped, since it is rather uncharacteristic for 'bad weather' to prevail in clear skies October! But then again, this whole confused weather pattern is unprecedented. Right from the frigid winter of 2007, in Mumbai, to the current rain patterns, it is bizarre! As though the Earth were screaming for help, by sending these incomprehensible signals.

And as though on cue, we have this whole impasse on the climate change dialogue. Confucius once said, " He who does not economise will need to agonize" Seems apt in the light of our current climate issues. I'd put in a post earlier (of outcomes and interests) on how expecting the emerging world to co-shoulder the climate change burden in a 50:50 manner along with the Americas and Europes of the world was almost certain to lead to a deadlock, with no amicable solution emanating thereof. And now, the UN General Assembly meeting has achieved just that, with everyone playing the penguin game - one where everyone waits for another to take the lead. In a classic case of what psychologists call 'mistaken attribution', the focus was more on WHO was responsible and WHO was not doing what was to be done, than on a clear idea on WHAT needs to be done to tackle the challenge as a global community. Here are some statistics in the map to prove why such circumlocutory behaviors are circumspect! The logic / rationale behind the developed world blaming their laggard approach on the lack of 'co-operation' from the emerging world is absolutely not justified.

The fact remains that the world is screaming for action. We need to act before it is too late. Mumbai, on the west coast of India is served by the South-west monsoon winds from June to September. Geography lessons in the lower classes had taught us that India has 3 main seasons - summer, winter and monsoon. And we also had specific months when these seasons would prevail. But imagine a classroom conversation of the future, if we don't take the cries of nature seriously -

"Teacher when do we have summer in India?"

"I can't say with certainty".

"Teacher how do crops grow?"

"Only with the blessings of God, since rains are never dependable"

What can we as the next generation do? Well, the usual stuff that we already know of, cut auto emissions, since that is the one portion of the emission story that is clearly in our hands. And on another level, we must use climate change idealogies as a guiding factor while choosing our elected leaders.

The Maoist Massacre

The scene was straight out of the Sippy flick - Sholay. Families massacred. Little kids targeted. The first reports called it a Maoist attack in Bihar. Later we realized that it was a fight - a casteist fight that resulted in such picked-out killings. And almost in immediate succession, just we heaved a sigh of relief, that Maoist rebels were not really wreaking havoc on civilized society, came news about the ruthless beheading of a Jharkhand cop by Maoists. For someone sitting in another part of this country, it felt revolting. What on earth is Maoism? And does it really promulgate violence targeted at children? Well, elsewhere in the world, such acts would be termed 'dastardly acts of terrorism', but ask the perpetrators here and they may as well say that this was their cry against the 'establishment'.

Studying developmental figures for the erstwhile 'BiMaRu' states, the plight is understandable. With a Gini coefficient at 0.318, the inequality in Bihar is stark. Reminds one of the situation during the French Revolution where the rich got richer and the poor got poorer. The state keeps screaming for all-inclusive, pro-poor growth. But when the law and order system is crippled, and the number of convoluted, inter-twined problems is humongous, the system takes some time to unlearn and relearn and implement. Granted, unemployment is high. Granted the poor are poor. Granted, the inequality is high as well. But the truth is, that efforts are being taken, and the results will show, sooner rather than later. That said, if the issue is with the Government, why not try to sort things out amicably? Killing children will almost certainly not endear the perpetrators with others who are suffering similar plights. If not anything, just like how the killings of innocent people by terrorists dilutes the so called 'cause' in the eyes of the common man, making the distinction between villainy and martyrdom even more stark, even if the Maoists, as per the original Mao Zedong doctrine are fighting for the rights of the poor peasant, they will be viewed with disgust and perceived to be another bunch of inhuman, insane, indoctrinated, inglorious, murderers and villains.

Whatever the cause may have been nothing justifies ruthless killing - be it the killing of children or of a law-abiding officer. More so, on or after Gandhi Jayanti, where the world celebrates the winner who never won, of the Nobel Peace Prize, a man who famously declared that 'an eye for an eye makes the world go blind'. A man who abandoned a rather successful non-cooperation movement after a retaliatory attack at Chaurichaura, just because the retaliation violated his principles of non-violence. If the Maoists were trying to send a message, I guess all of young India, (and I take the liberty of speaking on behalf of all other young like minded people like myself), feel that a message has been conveyed, of course, but a message that is horribly wrong, and completely contrary to the kind of picture the perpetrators wish to project.

Manic Monday - Are we Indians truly worth it?

Andie McDowell, Aishwarya Rai and Eva Longoria look us in the face and say - 'Because you're worth it'. But are we really worth it??? India is reeling under swine flu. That said, I just saw some reports of Chikungunya cases being reported in AP. Even a bustling metropolis like Mumbai was not spared. Pune and Mumbai became swine flu spots. And the administration received well deserved flak for not having a proper process in place to check the pandemic! We are supposed to be the sunshine country of the future. Linked with China, poised for growth, harbingers of the world economic order! And here we are faced with drought, (which climatologists claim is a natural occurrence once every 5-6 years, scientifically), a pandemic, the world economy is hit and all hell has broken loose!

Dr. Amartya Sen in his book Development as Freedom has compared the India-China story and described how the Communist, populist regime of China pre-reform focused on 'people development'. One can attribute some level of the people-centric policies to the Chinese culture, where education and all-inclusive health care are principles ingrained into their psyche. Chinese and Japanese were supposed to be the lodestars of human civilization and culture in the ancient times, after all. So, an offshoot of this deep culture, stood them in good stead, whereby by the time China got ready for reforms in 1979, they had a prepared, educated population all set to exploit the reformed economy to the fullest and steam roll their way into the future.

Could we perhaps even attribute this process to communism? Communism, as a philosophy speaks of 'down with the owner-worker relationship' 'everything belongs to everyone'. So could it be that these deep populist, equitable distribution seekers could allow this philosophy to creep into the realm of governance and ensure all inclusive provision of basic facilities? Take Cuba, for instance - it is supposed to have the best education and health care system in that part of the world. The statistics speak for themselves. 4th highest in literacy rate, with literacy rate almost reaching 80%. Before the Cuban Revolution, Cuba had the third-highest number of doctors per capita in Latin America, the mortality rate was the third lowest in the world, infant mortality rate was the lowest in Latin America and the 13th lowest in the world, and life expectancy was some ten years higher than the Latin American average. Kerala - the Indian state with the highest literacy rate, and maximum institutional births in India. Although industrial growth has been dismal, quality of life for the people is rather high in comparison to the rest of India. The key again was inclusion in provision of health care and education, that resulted in overall upliftment.

So, while China was prepared for the liberalization movement, India in contrast, when she liberalized her economy, opened up the economy to grossly under prepared people, who were still majorly illiterate and perhaps never understood the modalities of a liberal economy. As a result, to a very great extent, it appears as if the whole liberalization regime was either too premature, given India's gross lack of preparedness to rise up to the challenge, or the developmental part has a lot of catching up to do, to make up for the lost ground.

That said, it is perhaps not enough to just develop pockets. It doesn't make sense to have the most opulent sea facing mansion on one end, and Asia's largest slum on the other end of a city's spectrum. Unfortunately, this spectrum is indicative of the pattern existing in India as a whole as well, with interior India still struggling for electricity and water, while some other regions grapple with issues of floods. It is all a bit murky, and a lot of sorting out needs to be done. But at least the administration seems to have its heart in the right place. There has not been a famine in India since 1947, and Dr. Sen attributes this to the fact that we have a democracy, that ensures that vote bank politics prevents governments in office from not taking adequate steps to arrest famine in the wake of food shortages. One just hopes for words to get translated into actions and we hope that a sunshine nation like ours may not still, after 62 years of independence, grapple with issues like drought, policy initiated 'food crises' or curable diseases turning into pandemics!

Friday Funda : Protectionism

Remember the in-flight safety video? Where the oxygen masks drop during turbulence and you are told to mask yourself first and then help others out? Well, economic recessions and fluctuations are a lot like mid-air turbulence. They throw all sense of routine and uniformity out of balance and every one's life is thrown in disarray. At such a time, is it wise for a country to take on a similar 'protect yourself before you protect others' approach when it comes to economic growth?

The answer, I felt till a very long time was yes. Each one for himself. Tough times need tough action. And if I don't safeguard myself, how can I expect someone else to safeguard my interests?

As it turns out, this idea is wrong in a globalized world. Given the current economic downturn, many nations are feeling the pinch of recession, and are scrambling to save themselves from collapse. Underdeveloped nations that depend on the developed world for survival have had to bear the maximum brunt of the recession. But what is surprising is that in spite of the degree of development achieved by the developed world, in spite of the cushion of comfort the numerous years of growth have afforded them, the developed world also tried to scramble for cover! A glaring example is the 'Buy American' clause in the rescue package of the American government. I happened to see the hue and cry against this clause in Canada, whose dollar value of trade is the largest with USA, and it was then that the full force of the argument hit me. Look at it this way. The world is going through turmoil. Internal consumption is hit badly. So, to keep the economy afloat, you need to look outside - trade. And if your counter party (who happens to be an economic superpower) in the whole trade equation turns away, to protect his own interests, where else do you go? Superpowers are afforded that status for a reason - the immense accumulation of sustained growth over the years is actually supposed to put them in a position to help other 'comparatively needy' countries out in times such as these.

I remember having read an article once, when the whole cap on H1 visas came out in early 2009. The article spoke about parochial decisions that make a government want to look inward and at short term political benefits while forgetting about the long term implications of its actions. In other words, the article went on to say that in a recession, where a sudden spurt of growth through innovation is the need of the hour, if a country like US were to shut its door to skilled labor, they are in a way missing the forest for the trees! And later, when the recession goes away, the opportunity cost for the skilled labor may not be incentive enough to make them want to go to work in the US. At such a time, the long term picture would have effectively been ruined on account of protectionary tactics of the past.

Funda conclusion - Protectionism - not good. A superpower must use her superpowers to elevate all those suffering under recession, and such a mass elevation can alleviate every one's issues collectively.