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Was Indian Election 2019 a Victory for Populism

By Shealja Sharma  @ArguingIndian

Sonali Ranade @sonaliranade

 

Modi’s victory in 2019 is a triumph of populism over a liberal democracy.  Populism has often been defined as an illiberal democracy that relies on majoritarianism but bypassing many of the others aspects critical to a democracy. Populism poses a direct threat to democracy and its institutions.  Democracies are uniquely susceptible to populism and have a way of being waylaid by it from time to time.  India itself has witnessed a spell of populism under Indira Gandhi in the early 70s that did not play out well and culminated in an emergency where democracy itself was derailed.  It is imperative therefore to pause at this juncture to understand what is exactly is populism, and how and why democracies succumb to it. Political scientists have studied Populism’s political character and it well worth reviewing this here in order to be better placed to negotiate the perilous way ahead.

 

 

Populism may be defined as a process of political mobilization that transcends party structures and seeks to build people’s support around a charismatic personality by creating a direct link between the leader and people using mass communication technologies like the media, including social media, mass rallies, propaganda etc.  The essential difference between a populist mobilization and other forms of political mobilization is that the link between the leader & supporters is direct, non-intermediated by political party or institutions, and light on ideology. The person of the populist leader is the rallying cause per se. The causes he or she espouses are transitory, ever changing according political need, and are usually formulated in such way as to cut across all established political parties and structures. For instance Modi’s appeal to Hindu nationalism is designed cut across the usual caste and class structures around which normal politics has been built so far.  Populism also seeks to create a people vs. other paradigm where the other may be economic, social or political elites, minorities, and liberals, whatever. The aim is to fragment existing political structures and attract support of the floating opinion towards the strong & charismatic personality of the leader.  The causes could be anything from ethno or religious nationalism, communal polarization, to vaguely structured peoples vs. established elites.  The cause itself is secondary but focuses on an existing political fault line.

 

 

Populism doesn’t arise in vacuum.  It is usually a reaction to something else that happens in the polity or the economy.  Looking at the way populist movements arose in history, from that in Germany in the 1930s, to those caused by failing economies in Latin America to our very experience with populism under Indira Gandhi, we may surmise that populism is occasioned by a breakdown in the ability of existing political parties to cope with change in the polity.  In the case of Indira Gandhi, the patronage distribution system on which the Congress party was built broke down after Nehru’s death.  Without control of the brokers who worked the system, Indira Gandhi had no choice but to resort to populism appealing directly to people with a catchy “Garibi Hatao” slogan over the head of the Congress party.  This ruptured the party apparatus, split it into two, but she was never able to rebuild the patronage system in full in all geographies.  With that began the decline of the Congress party structures. Elsewhere in the world, populism has arisen out of an economic crisis as in Latin America or collapse of political system as in the post communist soviet system.  Presently, we are seeing populist movements in Europe and US triggered by threat of immigration.  Whatever be the proximate cause, populism is invariably accompanied by an inability of existing political structures to cope with a discontinuity in the political, social or economic environment.

 

Closer to our times, we witnessed such a discontinuity in the system occasioned by bankruptcy that necessitated economic reforms. As consequence of those reforms, the patronage system of the Congress party was shattered in 90/91 because they transferred effective power over resources from Centre to States. Effective control of the patronage system had already faced considerable dilution as sub-national actors within or outside the Congress captured power in the States.  They developed their own patronage networks and cultivated their own satrapies often using populism as the means to build support for themselves using sub-nationalism & regional pride.  We saw such satrapies in Andhra, Bihar, Tamil Nadu, and West Bengal. Indeed we saw one in Gujarat under Modi himself.  This shattering of the patronage system within the Congress party structures at the Centre created a vital power vacuum that was never filled under Sonia Gandhi or Manmohan Singh.  Irony is that Congress lost power because it dismantled its own funding model without creating an alternative.  It is not corruption but lack of it under UPA I & II that led to its downfall. Which not to say there were no corrupt ministers in UPA.  Merely, that the funds they raised didn’t get to the central kitty.  Which perhaps explains the alacrity with which BJP filled the vacuum with anonymous electoral bonds.  Corruption is now fully sanitized & legal.

 

Modi’s populism is therefore a reaction to the breakdown of the patronage system and an effort to resurrect it under a different name.  However, Modi’s populism is not just the garden-variety pure populism.  Political mobilization is usually characterized as progmatic, patronage based or populist.  A core of progmatic political mobilization represented by the RSS and its vast organizational & ideological resources backs Modi. This progmatic agenda of the RSS relies heavily on communal polarization as well as upper caste opposition to affirmative action. It is anti-Muslim and anti-lower castes. This core however cannot produce the required numbers for electoral domination of the polity. Historically, BJP’s vote share has struggled to get past the 25% mark.  Modi’s utility lies in energizing this core with Hindutva and adding to the core with a lot of floating supporters and unattached voters attracted by his personality as strong leader who has a vision of a strong and prosperous India. That this additional layer of support is ideology-thin is by design, not accident.  The lack of a clear-cut ideology/program gives him flexibility to go for whatever sells at the moment.  It also has the effect of amplifying the Hindutva message which otherwise would be restricted to just the core.

 

It is also essential to realize that Modi’s populism is the effect of, not only the breakdown of the established patronage system of the Congress, but also a deep response of the people to the populism of populist leaders at the regional and/or State level.  Modi did not invent populism.  That form of political mobilization has long been in use in States be it Tamil Nadu, Andhra, West Bengal, Odisha, Gujarat, Mumbai, Bihar and even Uttar Pradesh under many regional populist leaders like MGR, Karunanidhi, NTR, Mamata Banerjee, Patnaik, Lalu Prasad Yadav or Mayawati.  They were all ideology-thin, non-patronage based political players, who built their parties around a single idea, ranging from regional autonomy in Tamil Nadu, caste based mobilization in UP/Bihar, to regional pride in Gujarat, Bengal etc.  Shiv Sena in Mumbai began its politics as labor union busting organization favored by tycoons but latched on to Shivaji & regional Maratha pride later.  So populism is not something new.  However, these regional populisms have asserted themselves against the center at times, and are seen as centrifugal tendencies that are gathering strength.  At times, populism can only be fought with populism.  Modi has been able to build his version of populism as something countering fissiparous trends in the polity, vaguely portrayed as misguided liberalism, minority appeasement, regionalism or separatism, etc.  It helps that the Border States like Kashmir, Punjab, Bengal, Assam, Tripura, even Kerala with its Dubai connection, have higher percentage of minorities and have been among the first to fall to regional populist leaders.  Tamil Nadu too falls in this category but for a different reason.  This feeling of a latent sub-nationalism led by populist regional leaders evokes a counter in the form of Modi’s potent nationalistic appeal. Whether it is the right response or not is a different matter.  What is important is that Modi is not the only populist in town.

 

Congress has largely failed to grasp the emerging political challenges after PVNR.  The failure began not with Rahul Gandhi but his mother and at two levels.  Firstly, despite the stunning success of 90/91 reforms, Sonia Gandhi failed to take pride in them and rebuild her party around them.  Instead she continued the party’s hugely dysfunctional and largely futile alliance with a Marxist cabal around her that frustrated all meaningful reforms after PVNR. Secondly, she was unable or unwilling to rebuild the patronage systems her party depended on and allowed a free for all system to evolve that amplified the perception of corruption in her party.  There is simply no escape from the reality of party funds.  If you don’t centralize them, you hand over the party apparatus to regional satraps and pay a double price.  Corruption not only increases but you cannot escape the blame for it.  So under Sonia Gandhi, not only did the Congress lose its ideological moorings to economic reforms but gained a stench for corruption, – largely unjustified and grossly exaggerated – that it has been unable to shake off since.

 

Rahul Gandhi has been unable to rebuild the Congress party as per his dreams despite a decade of trying.  But like Sisyphus, he keeps trying to roll his heavy rock up the hill in the same way as before, hoping for a change of luck. Just as there is no free lunch in a dog eat dog world, there is no such thing as a lucky break in highly competitive politics.  The fact is RG will never be able to rebuild his party the conventional way because the building blocks no longer exist.  As his party’s empty treasury should tell him, the old patronage system is gone from his grasp.  It has been captured by Modi-Shah and they aren’t about to do him any favors. Without funding party machines cannot be kept in good repair.  They wither away.  Congress now faces the uphill task of finding a charismatic leader who can fashion a populist movement to take on the party juggernaut of the BJP.  It is an advantage that his party once enjoyed.  Now the shoe is on the other foot.  Short of populism, there is simply no other viable alternative for political mobilization available to the Congress any more.  In short he has to the charismatic leader with a powerful populist program that can work on a shoestring budget or it is game over.  He has no other choice.

 

What of the polity?  It is hard to say how this “national” populism vs. regional populism will play out.  The future is portentous. We can pretend everything is normal now that we have a strong popular leader at the center.  But two things should be clear.  India is a State with 20 odd potential nations who fulfill the criteria of a distinct people, culture, history, language and geographical contiguity.  The regionalism that we see at the periphery is well grounded in latent sub-nationalism. The glue that holds the Indian state together against the regional pull of latent sub-nationalism is a common market, common law, growing economy and most important of all, lived experience. What does not hold it together is a “strong center”. RSS may fondly hope that Hindu-Hindi-Hindustan will hold everything together but this is far from proven.  We will never be able to resort to coercion, alone or in a major way, to hold the periphery.  We will hold them only through a shared vision of the future.

 

Populism will not suffice to tamp the divisive forces arising out of stoking of Hindu sub-nationalism that has become the defining signature of the Hindu Right.  If anything, it will accelerate the fissiparous tendencies by legitimizing sub-nationalism and provoking regional leaders to exploit it in order to cement support for themselves.  Tamil Nadu provides a classic example of how to build a two party regional political system that shuts out pan-India parties.  The model can be easily copied in other states as well.  The Hindu-Hindi-Hindustan formulation has very limited appeal.  That fact should not be obfuscated by the pan-India appeal of Modi. Nor should we buy the idea that Hindu nationalism per se will unify the polity.  India is just too diverse for that.  We should also not forget that no meaningful economic reform is possible without real economic decentralization and the latter is impossible without regional autonomy.

 

Wisdom demands Modi dial back on Hindu nationalism. It has served its limited purpose. If at all it had a purpose. Wisdom demands Modi moves to restore the critical institutions of the State & dial back on the cult building around his persona. And wisdom also demands opposition parties sit down together & evolve a common program.  If they don’t hang together, they will hang separately.

 

Populism has rarely ended well despite good intentions. It is inherently illiberal and impatient with democracy and rule of law.  It is impelled to justify every shortcut with the mandate that the populist leader enjoys.  It refuses to abide with checks and balances of institutions.  And it has scant respect for dissent.  It is impossible to say how India’s second tryst with unabashed populism at the Centre will end.  We can only hope rule of law, democracy and its institutions & the innate good sense of our people will prove enough of a check against its excesses.

 

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Lord Ganesha: Why INR is over-valued in relation to Renminbi using wage rates and how that destroys jobs in India.

April 26, 2019 Leave a comment

The basic problem is that because Modi ji kept the INR over valued to the $, it became cheaper to make a Ganesh idol 4 puja & ship it to Mumbai rather than have the same thing made at Urnoli, in Uran District,a village some 30 km from Mumbai wiping out artisans of generations.

 

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he village in Urnoli has made these idols 4 generations. It is located by a backwater Channel to Mumbai harbour, home to lots of clay & free water. The idols are made by hand by families. They are dried in the sun & painted by hand. Used once, they have no further value.

So you see my case? Clay is free, so is water & sunshine. Colouring paints & wooden scafolding are the only raw material which costs less than 5% of sale value. The idols are transported in mini-tempos at night to Mumbai. The only major cost is labour. So …

… we have a village, 30 km from Mumbai, unable to competitively sell a low tech product requiring little more than skilled labour to make against imports from China?

How is that even THINKABLE? Yet it is true across a swathe of industries. What economic factor accounts 4 this?
The example implies manufacturers in China are virtually using slave labour at slave wages in order to be able to compete with labour in Urnoli. Or that the INR is so highly overvalued in relation to the Renminbi, that to workers in Urnoli, Chinese labour is cheaper by that much.

Note there is no slave labour in China. And here we are directly comparing wages in China with wages in India. Now since wages in India are cheaper, the only thing that makes Urnoli workers uncompetitive in India’s over-valued INR or dysfunctional exchange rate policies.

The problem predates Modi ji’s 5 years. But the exchange rate problem was exacerbated by Modi ji’s penchant for strong INR. He had to retreat in the face of an explosive rise in crude but the bias continues.

Now there are a army of sarkari economists & others there who will point REER to me. All I say to them is REER itself is bunkum. Firstly despite REER we have hair-cut devaluation every decade or so ranging from 15 to 20%. If REER worked, these devaluations would be unnecessary

Second, in the Urnoli idol case we are directly comparing Chinese & Indian wages. 4 all practical purposes, there are no other costs involved except transportation. 30km in one case, 3000 km in the other. So how does China beat India in Mumbai?

You can go to Urnoli’s villages 2 ways. Firstly via JNPT by ferry/car. Or you can turn off from the Goa Mumbai highway after Pen going towards Mumbai. You can’t miss the turn now that it has flyovers etc. The place is beautiful 4 bird lovers. Verify & tell me how this works.

That is the tragedy of our Sarkari economists. They dare not go beyond sarkars models to apply their trade. They don’t ask stupid questions like me b/c they can’t afford look stupid.

As you can see from the map [load it into your Google Earth] the clay & water are both abundant & free & there villages I speak of are on the banks of the channels. The place is home to millions of sea birds.

 

Screen Shot 2019-04-26 at 4.31.09 PM.png

 

 

 

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An Anonymous Post.

April 26, 2019 Leave a comment

Warning:

 

I am not entirely comfortable posting it here because I don’t have the author’s permission to do so.  In fact I don’t know who the author is.  But it makes some important points & offers crucial insight into how “appropriation” works and why it is important to recognise it.  Akaar Patel had once offered a similar insight but he appears to have lost his voice these days.  So take with a pinch of salt.

 

Text of DM:

 

 

“There is a proverb in Malayalam that says that when a trivial man suddenly becomes wealthy, he will hold an umbrella at midnight to avoid the sun. That’s the story of cringeworthy Modi.

His latest interview shows the extent of his megalomania, his vanity, his pretensions and pomposity. He is so in love with himself as PM, so enamoured at getting such a plum post that he perhaps never dreamt would be his, that he now cannot see any boundaries to that ambition. It’s overvaulting. It’s unchecked. It’s urgent. A monumental personality flaw.

So, in his manic hurry to grow exponentially in stature,he merely appropriates all the symbols available of greatness. In the first year, the monogrammed suit and meeting with Obama where he broke all protocols and went into first name calling and informal bear hugging on the first meeting, was intoxicating. It turned his head irrevocably. It catapulted him into a rarified space of wealth, influence, and most importantly power leading to hubris. It’s what classically happens when you get something too precious too soon. You lose its value. You begin to think it’s your birthright. You take it for granted. A niggle of worry about losing it ignites rabid fear.

Then your humble past, the housemaid status of your mother, the tea selling boy, the chowkidar nomenclature, the begging fakir, the visits to the lower middle class house of mother (almost stationed there like a prop) all simply add to the heights you scaled. You use it to fill the ordinary people harbouring modest ambitions, with extraordinary awe.

It is clear from the recent puke worthy interview with Akshay, that that first brush with the most powerful world leader, even today, makes him blush and flush with pleasure as he very immaturely brings in Obama’s name, completely irrelevantly into an unrelated question and claims intimacy of a childhood friend’s familiarity. The tu nonsense will be trolled for a long time. This paints over the grimy beginnings and appropriates all that Obama stands for. Education, class, power, wealth and prestige. In one sweep you try to own it. People who see through want to puke. Many, who don’t, are impressed.

This macro appropriation of colossal power is seen in the speeches where he never fails to tell you he represents 1.3 billion Indians. He made it 6 billion at Davos appropriating 80% of world population in a Freudian slip.

Then he talks about purana naata with all countries he visits thereby creating an earlier bond that increases his network of influence.

The travels, the hugs are part of this appropriation of international spaces where he probably thinks he has conquered hearts and loyalties by landing on the soil in a Caesar-like veni vidi vici mode. This is reflected in his bhakts telling you about how he put india on the international world map.

Then we have the threats. If you are not with Modi you are anti national, traitor, seditionist, terror sympathiser, Pak lover etc. Here, he appropriates nationhood, patriotism, loyalty, pride of all ancestral history, in order to again, in one giant sweep glutton up the country of its past, present, and future.

Furthermore, recently he appropriated the might and significance of our entire armed forces. His minions will swagger about how it is ‘Modi’s army’ as if he were Alexander on an interminable mission of conquest. He tries to buy votes on martyrs as he genuinely thinks they are his foot soldiers.

He will use every tragic event to politically push his agendas. All work done by previous governments are disregarded so that he can have that last applause by placing the cherry on top and claiming to have done the whole job himself.

A master of image management he will announce schemes with pomp and pretend they are achievements merely by virtue of their having been announced. He is not a man pretending. I do believe he is in a mentally delusional state where he believes that he has truly achieved. Hence the allergy to questioning. It will break the mould. That pain, a lot of self deluding mental patients living in denial will tell you, is excruciating.

Several interviews, created on the eve of the elections have put paid to the criticism that he fears the Press. But then, in those meticulously crafted interviews of Prasoon Joshi and Akshay Kumar, we clearly see impotent anchors asking benign rhetorical questions that are all couched in predicated glorious praise embedded in, and preluded by How can you be so amazing Mr. superhero? Are you for real? There’s no one quite like you baby! kind of trash. Yes, it puts your teeth on edge.

This very small dwarf of a man then smiles in self indulgent pleasure desperately trying to control his ecstasy and dons a benevolent, self satisfied, karmic, wise expression before spewing forth a bunch of hallucinations, scripted to make him look progressive, contained, objective, magnetic and well connected. None of which is remotely true. A congenital liar needs no cloak of shame. One that has begun to believe his own lies lives in a parallel, altered universe.

The submissive, obsequious and pusillanimous anchor putty clan simper along with the patience of Job. They could be interviewing God Himself! No counter points, no uncomfortable questions, no interruptions, no interventions, no screaming , nothing! The one with Akshay on mangoes and other trivia tried to paint him as an accessible human while heaping praise and allowing for truckloads of bragging.

If Modi could make a trip to outer space, even if they flew him to a satellite station, he would appropriate the stars, the galaxy and the universe. They would come back with stories of miracles. And the bhajan mandali on Earth would say he is an avataar of none other than Sri Ram.

The megalomaniac’s journey from the regional, through the national and international, to the cosmic and divine would then be complete.”

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Restricted Access Model of Corruption:

April 23, 2019 Leave a comment

These are basically my tweets on the issue of some innovations that have surfaced in the sphere of corruption of our political economy that I made some time back.  People have been asking me to consolidate my tweets at one place on some topics.  So this represents the first of such consolidations.

 

I am a rather poor writer with little patience for the art. Will try & blog some ideas and see how it goes.

 

Thank you for reading.

 

Innovations in corruption.

There has been a lot of talk about ushering in a corruption mukt Bharat. The truth is that there has been some fresh thinking about corruption under the new Government & I would like to share my thoughts on the same with you.

So here goes. 1/n
The first is that the earlier regime was riddled with hypocrisy. The fact is running a party machine, fighting elections, and motivating & rewarding political workers is an expensive business. It requires funds that only the wealthy can provide & so there is the inevitable deal.

Under the Congress, prior to 90/91, a combination of the license/permit raj and patronage to those who could pay rents, provided the key funding for Congress. Which is not to say the opposition was chaste. Their chastity was mere lack of opportunity. Model was the same.

The Congress system was “free-for-all”; anybody who could pay was welcome. Everybody had equal access. The highest bidder won. Second, when the people at lower echelons saw this game, the replicated it at their level. Corruption ballooned. Politics became business.

90/91 changed the game by ushering in economic reforms destroying the old rent seeking model by abolishing the central licensing. This had an unintended consequence. As the Central Govt. shed its control over levers of patronage, the action shifted to the States.

Although no license required, entrepreneurs had 2 still line up before state Govts 4 allotment of land, water, electricity, labour permits & a host of other things. So rent extraction shifted from Centre to states & regional leaders gained power of patronage from the centre.

As power of patronage shifted to States, the Congress leadership in Delhi grew weak and the regional leaders far stronger. So much so that by the end of PVNR Govt., Congress party itself began to unravel as regional leaders revolted or struck out on their own.

As U can see, corruption at all level except Delhi multiplied. It was in the milieu that BJP stepped in. ABV followed the Congress model. Paid the price. When Congress returned to power, it had learned nothing from experience. The old State level rent extraction continued.

The present Govt. did learn important lessons from BJP experience. You cannot decentralize power of patronage & still control a pan-India political party. That’s was the Gandhi family’s political blunder. Modi ji therefore concentrated all such power in himself.

But if money is generated by state level leaders, how do you centralize power of patronage. Hence anonymous electoral bonds. Those seeking patronage go to the top, make the deal, contribute anonymously to the party kitty. Regional leaders are not involved. U control the treasury.

That is why Congress also supports anonymous electoral bonds. If & when it returns to power, it will help the Gandhi family to reestablish central control over the party as it was before 90/91. So they make noises but favor electoral bonds. Now 2 the 2nd innovation.

Recall I said the Congress system was free-for-all & widely emulated at lower levels by those controlling patronage. This model is terribly flawed in game theory terms.

2 simplify, if everybody can corrupt [free access] and everybody can accept bribes, the earnings of all fall.
As usual economics tends to be counter-intuitive but bear with me. First the demand side from tycoons. If tycoons have to compete 4 patronage, they will bid the highest bribe they can afford. Competition puts costs up. Where will they recover these costs from? Obviously you.

So if rents that can be extracted from you consumers are R and the bribe paid is B, [R -B] is the profit to the tycoon. As many tycoons are competing & its is competitive bidding, the [R-B] over time falls to 0. So the tycoons gain nothing from corruption.

On the other side bribes are the total rent that can be extracted. More people you share it with, the per capital share falls. So the free-for-all corruption under the Congress model is very inefficient. Not only that, it is also very noisy b/c prices must be disclosed 2 bidders.

The present Govt. has wisely moved to eliminate the free-for-all model and replace it with a restricted access model. Now everybody cannot bid 4 patronage. Only a selected few crony tycoons may bid. And secondly, the bids are tightly controlled at the highest level.

What the Restricted Access model does to increase both tycoon level & party level yields from rent seeking. Since competition is restricted to few cronies they need not make competitive bids. So B is smaller, [R-B] is bigger, they are happy. And B is not shared. Happiness.

Not only is the Restricted Access model more profitable 4 tycoons & politicians it is also not noisy as before. Since bidding is not competitive, there is no need to disclose price. Lower level corruption is not allowed but actually punished. So corruption visibly decreases.

That then is magic of the Restricted Access Model. You can reduce visible corruption, you can prosecute corrupt people lower down 2 discourage competition, be a corruption fighter & still maximize rent yield to your party. What could be better?

Now you will better understand why even BJP has copied the Congress model of appointing CMs from the central level. U can’t let state level people compete with you for share of rents.

That’s where we are. BMKJ.

 

Some additional notes to above tweets for further study & research:

  1.  The idea of restricting access to rents from corruption to a selected few is not new.  It is based on the ideas of Nobel Laureate Gary Becker who first showed that it makes great sense for the corruptors [rent seekers] & the corrupted [the politicians who create rents] to restrict competition for rents by restricting access to them through creating barriers to entry.  This prevents dissipation of rents through competition thus ensuring the maximum returns to both groups.

 

Screenshot 2019-04-23 at 8.06.10 AM.png

 

2.  The RAM of corruption has the added advantage of reducing visibility of corruption that accompanies wider participation in rent seeking.  Secondly, it allows the elite rent creators [politicians] to claim the hallo of corruption fighters by being seen as keeping out those rent seekers who are in any case to be denied the benefit of rents.  In fact the more you eliminate corruption at lower echelons of Govt. the higher the rents for sharing available to favoured rent seekers & politicians.

 

 

Screenshot 2019-04-23 at 8.45.12 AM.png

The excerpts from the book “Political Capitalism” by Randall G. Holcombe.

 

 

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GUEST POST by @ArguingIndian : Profound Simplicity to Confused Complexity: Modi’s journey from Hope to Fear

March 23, 2016 Leave a comment

When the current Prime Minister of India Mr Narendra D. Modi started his campaign in 2014 for the Prime Minister post, He builds all his campaign around the word “HOPE”, A hope of brining “Acche Din”, Is he able to fulfil his promise ? If we go by the events since he took the oath and analyse it from the socio-political prospective, the result looks quite disappointing. While selling his product ( Acche Din) to his customers, i.e. voters the value proposition Mr. Modi has offered is not yet delivered. What could have been the implication if you put this in the professional scenario, of course you would have been fired. Critics could say democracy work in a different way and he would be judged after five years. Agreed, so how the relation of voters and Government does works; let’s go to the very basic of government role defined by Social Contract Theory1. In the trade-off of surrendering natural rights, Individuals in return are guaranteed civil liberty, freedom, rights, and equality by the govt. And, “Will” not the “Force” could be the basis of enforcement of social contract.
What forced Modi to adopt the divisive agenda or it is the natural outcome when you identify yourself as a Hindu Nationalist? BJP and its followers since beginning have focused on exclusion of minorities and opposition. They don’t see them as the actors of democratic society. In the last two years many incidents took placed; Dadri incident when Akhlaq was killed by the religious fanatics, exclusion and target of minorities over the issues of love Jihad and beef ban, JNU incident where civil liberty has been put under the lock. And it’s not only the socio structure which is under the pressure, Economy is in doldrums and the failure to revive economy has squelched the hope. Current govt has failed to implement the social contract. And his silence has been amplified by his supports by going berserk. Modi and his followers have tried to shut every legitimate voice of criticism by labelling it Anti- National. Hounding one community has become the hallmark of BJP followers, while doing so, they forget that in comparison to the west, Indians believes in collective identity. Therefore, when you are offending a person’s belief you are not offending a single person, it’s the whole group which get offended.
We all have witnessed how Modi’s campaign of hope has been turned into a fear. Why Hope always worked in the case of mobilising people and not fears? For an individual hope’s cognitive process releases an endorphin like emotion. Hope creates resilience and requires lots of resources and broad focus to fulfil that desire. In contrast to hope, fear operates in primitive areas of a brain. Fear trigger anger and frustration and operates with a very a narrow focus. Modi and his followers while playing with these emotions should realise that over using both, hope and fear can lead to distractions. Has the all Hope is lost or Mr. Modi has lost the focus? How he could revive the Hope and get away with the atmosphere of fear. For that he needs to show the attribute of a leader where a leader change his roles form autocratic to democratic as the time demands. While his silent node on all the incidents has been amplified by the supporters, as a PM of the country he should address the concern of minorities. To get the economy back on the track reconcile the differences with opposition on the crucial bills. And lastly, should avoid useless confrontation of interfering in educational institutions and rewriting the history. All can be achieved if Modi and his supporters adopt the policy of inclusiveness instead of divisiveness, though it is not the forte of Modi supporters but desperate times demand desperate measures therefore instead of pandering to his core base the time demand to rise above to the party politics and lead the India.

 

Mr Modi role in the new govt was to convert the Hope into the reality instead what we see all around is fear. In a society every role has fixed part to play with the predefined rules. When the role system2 collapsed, it leads to panic. “If a role system collapses among people for whom trust, honesty, and self-respect are underdeveloped, then they are on their own. And fear often swamps their resourcefulness. If, however, a role system collapses among people where trust, honesty, and self-respect are more fully developed, then new options, such as mutual adaptation, blind imitation of creative solutions, and trusting compliance, are created. When a formal structure collapses, there is no leader, no roles, no routines, no sense.”2 if we look closely we could see that currently India is going through the same phenomena.

 

References:
1 Rousseau, Jean-Jacques (1762) “Du Contrat Social”
2 Weick, Karl E. (1993) “The Collapse of Sensemaking in Organizations: The Mann Gulch Disaster” Administrative Science Quarterly GUEST

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Guest Post: Thoughts on Polygamy by Shealja Sharma

For long tweeple are debating on Polygamy and Monogamy, some are in favour of Polygamy while others opposes it. While they have their own reasons to support or oppose, I tried to search and read on the topic of Polygamy and monogamy And why Modern states are more inclined in the favour of Monogamy.
Lots of data and research suggest that all most all the societies have progressed from Polygamy to monogamy because the social problem it has created . How ? let’ see point by point

In 2012 University of British Columbia-led study that explores the global rise of monogamous marriage as a dominant cultural institution. And study finds that “significantly higher levels rape, kidnapping, murder, assault, robbery and fraud in polygynous cultures”

1) Problems for young man : It has been seen and proved that wealthy male of the society prove to be a stasher of wives. It increase the competition for partner and low status males had high chances of not getting any partner. According to Study

“ A little chances of obtaining even one long term mate, unmarried , low status men heavily discount future and risk taking, resulting in more socially undesirable behavior. Like higher rates of murder, theft, rape, social disruption, kidnapping, sexual slavery and prostitution”

2) Problems for Women : Polygamy reduces woman freedom, increase gender inequality and domestic violence. As in polygynous market men remain on the marriage market for longer term, it reduces the age of first marriage for females, increase the spousal age gap. Due to competition men uses all type of influences, connection and power to obtain wives. Also strike financial deal with their fathers and brothers. According to study:

“ More competition motivates men to seek to control their female relative, suppressing women’s freedoms”

3) Problems for Children’s : Monogamous marriage also results in significant improvements in child welfare, including lower rates of child neglect, abuse, accidental death, homicide and intra-household conflict, the study finds. These benefits result from greater levels of parental investment, smaller households and increased direct “blood relatedness” in monogamous family households, says Henrich

Refrence :
http://news.ubc.ca/2012/01/23/monogamy-reduces-major-social-problems-of-polygamist-cultures/

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MARKET NOTES: 29.03.2014. The bear market in Copper & Crude may be done.

March 30, 2014 Leave a comment

MARKET NOTES: 29.03.2014.  The bear market in Copper & Crude may be done.

 

The US Dollar [DXY] may have topped out at 80.50 and may be headed down towards a retest 78.50.  But the more significant news is from Copper and Crude. The charts indicate that the bear market in industrial commodities [& agricultural commodities not discussed here] may finally be over.

 

Bear rallies currently underway in Gold and Silver may have been interrupted by corrections but are far from over. I expect sharp uptrend in prices of precious metals to resume shortly, although the long-term picture in them remains pretty bearish.  That said, the bear-rallies, [with sharp corrections] have months to run.  Position traders should avoid the short side of the trade for now.

 

 

 

Gold:

290314_Gold_weekly.

 

 

 

Gold is currently positioned at $1294.30, a bit below its 50 & 200 DMAs even as the 50 DMA has pierced through the 200 DMA from below after a long time.  Is the rally in Gold from the low of $1202 on 12/31/2013 over?

 

By my reckoning, the long-term down draft in Gold that began from a high of $1923.70 in September 2011 has completed its first half of the journey at the low $1202.30 on 12/31/2013.  The rally from that point is one of a corrective nature and should run over many months with a target of $1550 or so.  What we have seen so far in 2014 is just the first leg of the corrective bear rally that topped out at $1392.60 on 3/17/2014.

 

A 50% retracement of the rally from the low of 1202.30 to the high of 1392.60 reveals a likely target for this rally at $1180, a price point fairly close by.  A much more robust floor is also close at hand at $1260 which also happens to be the 61.8% retracement level.

 

My sense is that gold will pivot sharply from one of these either of these two price point, most likely $1260, to rally sharply higher. The weekly chart appended above shows the first half of the long-term downdraft & the subsequent corrective bear rally underway in the larger technical backdrop.

 

While the long-term correction is gold is by no means over, the bear rally underway has a long time to run ahead and the retracement completed so far is but a fraction of the likely target. It is dangerous to be on the short side of Gold despite indications of a rally in $DXY which would normally serve to tamp down precious metal prices.

 

 

 

Silver:

 

290314_Silver_weekly

 

 

 

Silver has much in common with Gold in terms of the long-term correction underway in the metal but there are significant differences in price behavior.

 

Silver, much like Gold, has completed the first half of the long-term correction on hitting a price of $18.335 on 6/27/2013. It subsequently rallied to $25.126 in a sharp bear rally and has been correcting from there towards $18 level ever since. Silver failed to make a new low in December 2013.

 

My sense is that Silver too is likely to rally upwards from the $19 price region and the ensuing bear rally could take the price higher that $25 that we have seen in the first pullback.

 

Silver has seen $19 has seen very strong support at $19 a number of times in the recent past.  The current price at $19.79 leaves very little on the table for bears and is a perfect opportunity for bulls.  So like Gold, while I am not bullish in the long-term, I would touch the short side of the trade & would be comfortable going long with a stop just under $18.5.

 

 

 

HG Copper:

 

290314_HG_Copper_Weekly

 

 

Industrial & agricultural commodities, unlike precious metals, present a very bullish picture at the end of their long 6-year bear market.  Copper may have put at end to its bear market correction with the low of 2.9145 hit on 3/13/2014.

 

 

Copper began the latest leg of its bear move from a high of 4.58 on 2/03/2011.  It has seen a classic 5-wave  [with an extension of wave3] wave down to 2.923 on 3/13/2014.  To my mind that completes the bear market correction for Copper and we may into a new bull cycle for the metal.

 

Copper is currently positioned at 3.0315, off its recent lows but well below its 50 and 200 DMAs in the 3.20 price region. Copper is a buy for position trade for a target of 3.40 with a stop just under 2.90.

 

 

 

 

WTI Crude:

290314_WTI_Crude

 

 

 

 

WTI Crude has been in a long-term correction ever since the high of $147.27 on 7/11/2008.  I reckon, the C leg of the multi-year bear market in crude, may have ended with the low of $91.24 on 1/09/2014.  It is worth noting that the 5-wave C leg of the correction began with a high of $114.18 on 4/29/2011.  It’s been a flat but well defined 5-wave, flat with a gently upward sloping upward bias, correction which betrays a strong bullish bias to the commodity in the long term.

 

 

Crude has rallied from a low of $91.2 to a high of $105 and retraced 50% of the rise in the following correction. Crude may see another brief correction on rallying back to $105 from the current level of $101.67.

 

Crude is currently above both its 50 and 200 DMAs. Oscillators are in neutral zone, while the 50 DMA is about to trigger a bullish penetration of the 200 DMA. Crude appears headed for a first target of $105, and following a correction from there, a higher target of $110. I think a confirmed break above $105 will see huge accumulation in crude commence.

 

 

 

$DXY:

 

290314_DXY_Weekly

 

 

 

There is nothing like a long-term weekly currency chart for perspective.  Given the end of the bear market in commodities [except precious metals] it is interesting to see how  $DXY is positioned on long-tem charts.

 

 

DXY made a low of 72.86 on 5/04/2011 and rallied to a top of 84.485 on 7/09/2013.  The rally up traced a classic A-B-C wave up.  DXY has been correcting ever since but has always found support at 78.80 that happens to be 50% of the rise recorded in the last bullish leg up.

 

My sense is that the correction in DXY from its recent bull high continues and we may be in the last leg of the ongoing correction.

 

DXY made its last low of 79.438 on 3/14/2014 and has since rallied to a high of 80.5050 on 3/202014.  It is currently positioned at 80.335, a notch below its 50 DMA and well below its 200 DMA.  My sense is that DXY will drift down to retest 78.50 level by end of May, 2014 before it makes up its mind to rally from there.

 

 

 

 

 

 

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