Tagged: Government

A negative vote today in French Elections


Will France follow Donald Trump’s unexpected victory in the U.S. Presidential Elections and the Brexit philosophy endorsed by millions of British voters to get Britain out of the European Union (EU)? Will the French voters elect an untested nationalist, against a well-established urbanite with a global outlook?

How France decides today in its Presidential Elections (7th May Sunday) will have far-reaching ramifications around Europe and the world. It will determine if the EU survives as a political and economic entity.

While I have no personal views on the French Elections, I am debating if  young, disillusioned French voters will swing in favour of Marine Le Pen, against Emmanuel Macron. If that swing happens in a wild fashion, it is not inconceivable for Le Pen to claim the French Presidency and that would turn Europe upside down. Le Pen is against all established norms in French and European society – against trade, against immigration, against globalization.

In the U.S. Presidential Elections, I bet against Hillary Clinton and won my bet. I thought that she did not really appeal vigorously to the male, white, Christian, rural base of the middle America – and she didn’t, apart from all the other issues which plagued her campaign (like the email server problem, et al). I was not entirely in favour of Donald Trump, but then there was no other credible alternative, and he easily won the elections against Hillary Clinton, though he missed out on the popular vote count.

Can something like that happen in the French Elections?

Why not? A negative vote is entirely possible.

France is in a crisis. Its political and societal divides have engulfed its core to such an extent that radical outcomes cannot be thrown out of the door. France is under attack by immigrant extremism, or terrorism. Economy is in a turmoil and youth unemployment is rising. France has so many problems today that a traditional, globalized, suave and urban President will not get far into his presidency. Macron could prove himself otherwise, but it is highly unlikely he can fix France’s problems, as he does not have enough political and economic management experience. If he fails in his first year as President, it is almost a given that Le Pen’s supporters will revolt and her base will increase dramatically. And, let us not forget that Macron does not even have any party’s support – in fact, he has no party! Yes, he is coming on the strength of a people movement, not a political party!!

Can Le Pen fix the problems of France?

Even less likely than Macron. Her party has always been on the fringes, and most people are shocked she made it to the final leg of the Presidential Elections. She has no experience managing a large country or economy. She would need a lot of management help if she ever gets close to the seat at the Elysee Palace.

So, in a nutshell, it is going to be a huge challenge for France. May be Macron will win as he has a 25 point lead over Le Pen, but then one never knows. But France has to blame itself for any fiasco, as both candidates have never held elected posts and have hardly got any experience, and may not win parliamentary elections scheduled for June this year. How can this happen? How will a President govern without the support of the French Parliament?

All this points to a hugely challenging time for the French people.

The implications for Europe and the larger world community are huge.

Watch the news today and tomorrow closely to see how France votes for its President.

Cheers,

Vijay Srinivasan

7th May 2017

Pathetic TN vs Rocking AP


I was visiting Chennai these past few days.

Given that it was almost end of April with the fast approaching “Agni Nakshatra” of May/June, the heat was piercing through to the skin at close to 40 deg C. The evenings were a bit milder but still a strong 34/35 deg C. People were having no respite from the harsh weather, neither were they having any respite from a dysfunctional government reeling from corruption and nepotism.

The Tamil Nadu State was once the second top industrialized state of India, competing with Gujarat State for manufacturing plants of foreign companies setting up shop in India. Now, it has fallen to the bottom rungs of the ladder, with neighbouring Andhra Pradesh State climbing rapidly to the very top.

What is the difference?

In one word, it is “Leadership”. In two words, it can be explained as “development-oriented and corruption-free”. Indian citizens are very tired of corruption and politicians making huge pots of money without delivering any kind of service at all to the nation.

Tamil Nadu has long been reeling in corruption (only Karnataka State beats Tamil Nadu in corruption per capita), nepotism, mismanagement of government departments, distribution of subsidies and election gifts in a deficit state, lack of water, poor power supply situation even in metro cities, and generally characterized by apathy towards improvement in the state of affairs of the state and its people. The latest rumour is that a major Korean car manufacturer decided to move away from its original plans to establish a car manufacturing plant near Chennai due to the exorbitant demand for bribes. Of course, it is a rumour, but the rationale for such decisions need to be explored conscientiously.

Poor Tamilians. They just have to look a little north towards their enterprising neighbour, Andhra Pradesh (AP) which is run by a charismatic, influential, reform-minded and effective CEO kind of Chief Minister, Mr Chandrababu Naidu. He is running AP State as a corporate company, much like Singapore, with an effective administration carrying out his vision. Mr Naidu has always been in favour of induction of technology to address governance and peoples’ problems in the state, and it is no accident that AP State is a front-runner in using technology in all of India.

Mr Naidu has achieved a lot in the short span of less than 3 years that he has been in power, after his first long stint of 9 years. The milestone project was the interlinking of the Krishna and Godavari rivers, which not only has irrigated the rice bowl of India but also provided water to the parched villages in the Rayalaseema region of AP State. Apart from his many other achievements, I believe that the linking of two of the key rivers of India will always be recognized as his signature accomplishment. The Congress governments in the past only talked about such water projects but never delivered. Mr Naidu has done that now.

What about Tamil Nadu? It has been begging Karnataka for release of the Cauvery river water, has fought with Karnataka in the Supreme Court, and taken the matter to special arbitration. Over the years, the farmers of Tamil Nadu have suffered. Why? There was just no leadership focused on solving problems of the farmers and suffering people of the state.

In a nutshell, the defining characteristic of a successful government is leadership and the composition of the leadership team. If this active and critical ingredient is missing, no amount of funds or intent can do the job. And when corruption rules the roost, then you can rest assured that development will remain far, far away.

Tamil Nadu is destined to hit the fringe state status very soon, if no effective leadership emerges. What a pathetic situation for a state to be in? Tamil Nadu should aggressively reclaim its premier status and time is not on its side either.

Cheers,

Vijay Srinivasan

01 May 2017

Europe under continuous attack


Europe needs and deserves a firm leadership against terrorist attacks which try to disrupt peaceful co-existence of the 28 countries in the European Union (EU).

Like any other association of nations, the very purpose Europe came together is for trade, employment and joint defense (against U.S.S.R. in the Sixties and Seventies). Similarities in cultural backgrounds help in all such associations, though a common religion plays a much less role. Europe has always been willing to take in immigrants from non-European countries, though various countries in the EU have their own restrictions. Some of them are very liberal, some of them are quite restrictive. Germany is an example of a generous nation, well-to-do people, who have accepted immigrants as long as these folks can adapt to the local culture and learn to speak the German language. The history of Europe is laden with wars and refugees, and crimes against humanity, so it is not surprising that the Europeans are more open than others to war refugees.

However, we will soon find out if Europeans remain tolerant to the vagaries of the refugee influx, especially from Syria and certain other Middle Eastern countries. France is a case in point. Paris has been diligently attacked by terrorists who do not like the French way of living. While it is easy to cast aspersions on a particular religion for these incidents (including the one last week), the French people will do well to recall that their freedom did not come easily – they had to fight for it every inch of the way in the Second World War with the help of the Allied Forces. They had to fight against Nazi occupation – they were refugees in their own country. It is critical to take stern actions today to defend French freedom, no doubt about it. However, it is rather easy to swing to the far right and attack the whole philosophy of Europe and the EU. What positive stuff can come out of it? Why would France try to isolate itself from the rest of Europe?

Colonial powers such as France and the U.K. cannot escape their histoy. If there are millions of Muslims in France, that is the result of French invasion and occupation of North African countries several decades ago, may be a century ago. Clear-headed, rational thinking is called for when a government is dealing with all kinds of its citizens – they do not always come with the same colour, race, ethnicity or religion.

Nevertheless, Europe faces tough times ahead. Elections are a way for the far right to assert their extremist philosophies and gain governance after a long wait. That did not work in Austria and Denmark, and is unlikely to work in France. Germany, in my opinion, will remain centrist for quite some time, unless jobs disappear and crimes increase as a result of uncontrolled immigration.

The solution is to give law enforcement more powers as they are called to face and deal with militant elements of societies. Governments have to make it absolutely clear that cultures and philosophies would not be trampled upon in the name of giving big space to immigrants. Everyone has to live together peacefully, and the message has to go out loud and clear that if immigrants are not happy to adapt and accommodate, they should be free to return to where they came from. This message is critical and needs to be delivered by all types of political parties or governments. immigrants remain as guests of the welcoming host nations till they earn the right to become permanent residents or citizens and start a new way of life. Why should they want to replicate the lives that they lived in their respective repressive countries?

Europe remains a beacon of an elitist kind of democracy that other democratic nations can only aspire to become. It should not be split radically into segments which then cannot work together in the European Union. That would be disastrous for the future of this world.

Cheers,

Vijay Srinivasan

23rd April 2017

Gurus not exempt from Law


Spiritual Gurus have long been a bane of many religions around the world.

Their (largely) negative impact has been felt severely in India for a very long time.

Some gurus have positive impact overall. One of them is Jaggi Vasudev, the other is Sri Sri Ravi Shankar who runs the famous Art of Living (AOL) Foundation. There are thousands of others, but my simple view has always been that there is no need for an intermediary between God and I, or God and anyone else for that matter. Unfortunately, Hinduism, one of the most enduring religions of the world with over 800M followers, encourages the adoption of gurus to facilitate a communication with God. I do not agree with such a philosophy, though there are other major religions which follow similar philosophies, putting man over man. Humans look for a guide to help them navigate the world, and it is not at all a surprise that a Pope arises to guide Catholics, for example. The plethora of gurus in India does not follow any systematic approach, they crop up anywhere and everywhere where the gullible would fall at their feet and worship them. There are thousands of “magical” episodes when these human gurus have generated simply impossible manoeuvres which continue to fascinate their followers.

However, none of these “humans” are above the law of the land.

Sri Sri Ravi Shankar, his Art of Living Foundation, and his spokesman accuse the government and the National Green Tribunal (NGT) for giving permission to conduct the World Culture Festival in March 2016, which has completely destroyed the river bed of the Yamuna River which most Hindus consider as a holy river. Sri Sri is a charismatic guru, who is close to powerful politicians and the wealthy folks of India, and so it would be interesting if the expert committee’s findings would indeed find their way to justice in the current dispute between the government/NGT and Sri Sri/AOL. I don’t think it was appropriate for Sri Sri to accuse the NGT and the government for having granted permission to him for conducting the Festival.

Where is accountability and humility on the part of the famed Sri Sri?

Sri Sri Ravi Shankar and his AOL are not exempt from the law of the land, and have to abide by the rules and regulations. Being close to God does not exempt him from the rule of law. It would be interesting to see how his ardent followers react to the findings of the expert committee.

It is clear that spiritual gurus cannot run a government, a court or the environment. They should focus on God, not make Hinduism a circus philosophy. It is always good to hear some of the lectures of Sri Sri Ravi Shankar, but the wisdom of his speeches does not make him God. He is after all, an ordinary man, like all of us. If he commits a mistake, he has to pay for it. There cannot be an excuse. If a fine is levied (as it has been), then his organization has to pay it. Damage done to the Yamuna riverbed will take 10 years to fix, as per the expert committee. Who caused the damage? Not the government, nor the NGT. They merely granted permission, may be misguided, may be under some sort of pressure. But Art of Living Foundation and Sri Sri are entirely responsible for what happened. Who can contest this assertion?

Again unfortunately, most of us are emotional, and wish to kick folks who do not conform to whatever is the general trend of belief or philosophy, in this case of Sri Sri. If there is a variation to that thinking, then the people who think differently would be termed as traitors to the cause. Nothing can be farther from the truth.

Time to think on environment, time to think about Yamuna River, which has recently been designated as a “legal person” by the courts of India.

Sri Sri Ravi Shankar should apologize, desist from repeating such extravaganza, and indeed pay the INR 5 Crores fine. We should all respect the law.

Cheers,

Vijay Srinivasan

22nd April 2017

Non-interference


I felt very bad when I read about two bad things going on in neighbouring countries.

One was the long-standing problem of atrocities committed on the Rohingya Muslim community in the Rakhine State of Myanmar, which lies to the south of the border with Bangladesh. While accusations against the Myanmar security forces need to be investigated, there is evidence of forced evictions of villagers and around 70,000 Rohingyas have fled to Bangladesh. The UN Human Rights Council has been approached by various institutions for establishing a commission of inquiry.

The other problem is the killings perpetrated by the Philippines security forces on drug traffickers, drug users and unfortunate bystanders including children as reported by CNN. I was shocked to see the report on children being killed in cold blood, and the pictures were brutal. Is this how a legally elected government treats its citizens? Where is the judiciary and where is justice?

On both these situations, the ASEAN governments have maintained silence as they have always done over the past five decades – when it comes to pointing out human rights violations and extrajudicial killings, these governments keep their views to themselves. They have always argued that economy is more important than politics, but we are not talking about politics here. Common citizens are being murdered on the streets by security forces, and such atrocities are a thing of the past in most countries. ASEAN boasts of a growing economic union of over USD 2.4T in GDP, and generally the nations in this union are on a growth path. But that cannot come at the expense of human rights, which are constitutionally granted to citizens in the democratic countries at least.

Ethnic cleansing and extrajudicial killings should have been stopped immediately. Wiser counsel should have been firmly and strongly delivered by the UN and ASEAN. But apparently, this did not happen. ASEAN believes in total non-interference in the affairs of its member states. This is the old, failed policy of the bigger non-aligned movement, in which India and Indonesia were big partners. If a close neighbour cannot even comment, afraid of being knocked out of the potential economic growth of the offending nation, then that is not a strong marriage. I doubt if ASEAN will ever rise to the occasion and provide firm counsel to offending partner countries on the nature of the advanced economic and social union that should be their collective objective. The European Union is a successful model (notwithstanding the stupid “Brexit” by the U.K.), and has withstood the test of time while persevering not just for a common currency and regulations, but achieving uniformity in foreign policies, laws and immigration, etc., Turkey is having trouble joining the EU because its policies are not compatible with the wider EU policies of co-existence.

I strongly believe it should be each citizen’s responsibility to raise his or her voice against atrocities and killings committed anywhere, especially in the neighbourhood. Without peace and tranquillity, economic cooperation and development cannot happen. It is not right that we turn a blind eye and continue operating as though nothing bad is happening in our neighbourhood. What kind of social living is that?

While a country cannot interfere in another country’s affairs, countries which have chosen to co-exist in a trading bloc or social partnership for collective advancement, should have the right to publicly highlight issues of concern instead of keeping such issues hush-hush.

We should be deeply sorry about the state of affairs, and should represent our views to our respective governments. That would be a true democracy and a responsible one, which cares for not just the livelihood of its citizens but lives of citizens and neighbours.

Cheers,

Vijay Srinivasan

4th March 2017

Anti-Elitism and De-globalization


The world is rising against elitism, which is just another word for “learned segmentation”. It means that elitists are rather segmented folks – like a specific group of well-to-do people, a set of people who do certain things with a unique taste, a group of alumni from prestigeous institutions, a bunch of guys who drive Ferraris, a group of ultra-orthodox religious folks, a caste group (in the Indian context), and generally a bunch of well off folks who do similar things and think almost in the same manner, to the exclusion of almost all other people.

Personally, I have tried to stay away from any group with a label stuck on it. I exited the IIM-B Alumni activities as my socialist leanings are not compatible with an entrepreneurial or corporate money bags kind of people, though they may be my class mates. I have rarely seen any one of them doing charity, or engaging in philanthropic work for the downtrodden. They may well wish to do so, but evidence is limited. I even avoid brands – I don’t want to be seen driving a Mercedes or BMW or Audi; I do not wish to have a Rolex watch; and so on and so forth. I was without a Mont Blanc pen for a long, long time and could not say no when my children decided to gift one for my last birthday. When I am seen on the road, I just want to be a normal guy with no accessories which could define me in some way or the other.

The reason why young people are rising against elitism is the strong perception that they have about the relationship which exists between elitism and wealth, almost in an unholy manner, which in turn leads to inequalities in income. Wealth generates more wealth and income for the elitists or the rich folks. Others are excluded, and the exclusion is almost surreal. Things go on as though nothing has changed, everything is hunky dory. People who make obscene money on Wall Street continue to make that money year after year. Similar groupism and exclusions can be cited in almost every scenario. The insidious reach of money and networking power has to be seen to be believed.

One can argue about the merits of meritocracy in this context. I refute strongly the link and the necessity for any society or government to promote meritocracy at the cost of the rest of the society at large. What about the 95% of the people who cannot make it into that “special” list of people who will keep getting promotions and scholarships? In a nutshell, why would the special people be any different from their predecessors? They belong to a particular school, university, way of thinking, family, et al. That does not mean the rest of the people are stupid, or below average, or even average. There is this argument that societies and institutions prosper because a set of meritocrats has been handpicked to manage them and deliver results that are expected. While in a limited set of circumstances this may be true, in the larger context a social mix would provide better stability and sustainability with deeper understanding of societal issues and challenges.

I have not seen a huge difference between people with prestigeous MBAs and non-MBAs in the corporate context. There is only one difference – there is more structured thinking when you have some MBAs around you, and less of that when you have staff without MBAs. Apart from that, outcomes are not particularly impacted because MBAs are driving the businesses or even governments.

So, let us come now to the issue of “de-globalization”. Is there a relationship between “anti-elitism” and “de-globalization”? What do you think?

I believe that the movement against globalization has to be seen in the context of social elitism which predicates that globalization is the way to go for the world as a whole, since societies, countries and organizations can work together to produce better than average results for their combined economies. As a social theory, it is fantastic with an altruistic bent to it, no doubt. However, as a practical application of an interesting theory, it comes short as the results have been less than spectacular. The idea is not “win-win” but rather “win-some win for some time-lose-lose ultimately”. This means that not all sides are winners in a globalization effort. In the outsourcing example, India and the Philippines can be winners to a large extent, the U.S. and the U.K. are initially winners from a corporate cost-slashing perspective, but later become losers when the enhanced business competitiveness cannot continue at the cost of increasing job losses for locals.

The argument that outsourcers make the U.S. businesses more competitive does not hold water for the long term (it is fine in the medium term), as competitiveness in this context refers just to increased business profits. Competitiveness in terms of enhanced proficiency can also be obtained by training the locals to a large extent. Let us not forget the increased business profits come because of lower wages paid to foreigners as compared to the locals.

The liberal thinking is that globalization is great for increasing the volume of trade, and as more nations trade goods and service, eventually the world will become one homogeneous market. Great idea, no doubt. But it is naive and misses out on key economic fundamentals – that average per capita income across supplying and consuming countries need to be similar in order to enjoy true globalization. When India has a per capita income of USD 3,000 (on a PPP basis), and China has USD 8,000, the difference is huge between these two nations and the developed countries which have upwards of USD 40,000 per capita. So, a job loss in a developed country is going to have a major impact in its society.

For the elitists, it is okay – as they are perched on the top anyway. Armchair theorists won’t do anymore given the disarray in the developed countries. Fresh thinking is needed. The answer is not coming from anti-elitists only, but governments and economists have to think harder in terms of sustainable solutions.

Is it any wonder that social democrats such as Bernie Sanders enjoy rock star status? It is easy to jump into a movement and start shouting at the top of your voice, but harder to derive economic solutions which will stand the scrutiny of society. Anti-elitism and de-globalization are not new fads or book topics, but social forces which would make policy makers think deep and in a totally new way.

Cheers,

Vijay Srinivasan

19th February 2017

 

 

Why is Capitalism losing out?


For the past more than five decades, the philosophy of Capitalism has become well entrenched around the world. The Western world developed the concept of Capitalism, where the free allocation of capital and labour to the most demanding production jobs in the right proportion generated products required by the market, while also generating more than adequate returns to the investors (in most cases). The wealth created from the productive use of Capital led to more investments, and so on and so forth. The opposing ideology of Communism which is state-assisted labour deployment only had partial success in the predominantly Communist countries (though Israel followed the state-farming approach which yielded positive results).

In every ideology, there is cause for mistakes to happen – in the case of Capitalism, the owner of the capital becomes greedy and squeezes the labour for higher returns on employed capital – so the term “greedy capitalists”. In later years, this term was used for people who tried to grab whole companies by throwing money – if you recall “Barbarians at the Gate”, who then tried to fire the employees, make the company lean and mean, and then re-list the company on the stock exchange for fat profits, or sell off the company. These are developments of the capitalist theme and nothing wrong (except on moral grounds) from a business perspective as the purpose of a capitalist is to make money at the end of the day, and that concept is not going to change.

In the meanwhile, several large countries such as India, experimented with Socialism in a democratic context (unlike Communism which always had dictatorial undertones). While the world appreciated the new ideology of India such as removal of poverty, the results from the experimentation were not pleasant, as the social investments made by the government did not reach the intended recipients in most situations, and corruption became a bugbear with insidious politicians siphoning off money meant for productive deployment. A corrupt bureaucracy was the downfall of socialist initiatives pioneered by the government. Over the past 50 years or so, socialism gained only one moniker – which is non-interference in the affairs of other nations in the Non-Aligned Movement – and no concrete economic results or benefits which could upend the surge of Capitalism around the world. Hence, socialism was largely considered as a failure, though most political parties will never acknowledge the fact.

But now, we see an upsurge of socialist movements starting with the most capitalistic countries of all – the U.S. The youngsters who I categorize as late teenagers and early twenty somethings, have become tired of the greedy excesses of the Capitalist era, which concentrates wealth in the hands of few people. A case in point is that the top 82 wealthiest people in the world have more wealth compared to 3.7B people of this world, which is just ridiculous. This scenario of excessive wealth within the top 0.01% (or even less %) of the people reduces the possibility of wealth creation for the remaining people, and the resulting gross and obscene income and wealth inequality has caused the youngsters of the world to question the status quo system which favours the rich folks. There is nothing wrong in questioning the status quo and asking governments and political parties to explain the rationale for continued patronage that they extend to the wealthiest people.

There is only one reason why a government (prime example would be the U.K. Government) would want to support the wealthiest folks from anywhere in the world – one is that they bring most of their wealth. The other primary reason is that the wealth could be deployed to create industries which would then require employment – so you would then achieve more than two critical objectives for any government – you create lots and lots of jobs via productive capital investments, the money would be in your country’s banking system, and the resulting employment and business operations would generate additional tax revenues for the government.

Looks absolutely logical, isn’t it? The flaw in the above logic is that most people who move their money do not deploy the same to generate employment and taxes. These greedy folks are looking for ease of a sanctuary location (with no questions asked) and ease of moving the capital in and out, and of course, ease of living. Several countries are greedy enough to provide all of the above facilitators and more.

More and more insight reveals that the government directly does not gain any new net revenues. This is one major reason that social agendas do not receive budgets necessary to sustain the operation. Healthcare is ignored, while defence gets huge investments to support the defence industries. Education is ignored. All put together, people do not see justice and equality in the way things have panned out over the years, and it is no secret.

Socialism is therefore coming back, not with the same mantle but in a different avatar. The key expectation now is reduction of income and wealth inequality (not exactly “redistribution of wealth”), more opportunities for job creation, fairer treatment in the hands of the government, freer and fairer elections which would allow people to better elect their representatives, elimination of corruption and lobbyism, et al. These are all noble objectives, and we all tend to appreciate the new logic which is inherent in this new socialistic approach.

While Capitalism is not going to go away, it should be fearing that the attacks on it would not subside anytime soon. It would lose substantial power in the coming years as more socialists get elected around the globe. It would be rather interesting to witness this transformation in the coming decade, when socialism would be pitted against capitalism and conservatives, as we have seen in the U.S. Elections within the Democratic Party nomination fights.

Have a good weekend,

Cheers,

Vijay Srinivasan

12th February 2017