Monday, 31 March 2014

Wanted: mentors, not coaches

Elite sportsmen today don't lack motivation, nor do they need to be whipped into shape. What they need from their coaches is tact, judgement and clear speaking
Ed Smith
March 30, 2014

Darren Lehmann, sporting some extra facial hair, chats with Mitchell Johnson, Brisbane, November 15, 2013
The best way for a coach to win the support of his players is to convince them that he can help them play better © Getty Images 
Imagine you are about to make a putt to win the Masters. The gallery is packed, millions are watching on TV, there is an eerie silence as the Georgia sun sets. You stand over a nasty ten-footer, the moment of truth. And then, at the peak of concentration, you see your coach jumping up and down, beating his chest, shouting at you, "Just don't miss! Put it in the hole! Show some guts! Don't back down now! Make bloody sure you don't bottle this one! What kind of man are you?"
Now imagine you are the first violinist, about to make your debut at the Royal Opera House. Just before the first chord, with the curtain about to rise, the conductor turns to you and whispers, "If you make a mistake today, any mistake at all, I'll stab you in the eye with my baton. Now let's play Don Giovanni with freedom and expressiveness!"
And how would you treat a surgeon about to conduct a life-saving operation on your wife or child? Would you threaten, bully and intimidate the doctor? Or would you try to avoid adding further anxiety to an already fraught situation? In all these three situations it is widely accepted that no sane coach, mentor or observer would seek to add to the anxiety or effort of the protagonist. It is taken as a given that the golfer, surgeon or musician is already trying hard enough - perhaps too hard.
And yet in most sporting contexts, the default position of coaches - and pundits who judge coaches in the media - is to assume that the problem afflicting a team or an individual player is usually caused by a lack of effort. If only players cared more, tried harder, felt disappointment more deeply. That sentiment, so widespread in sport, gives rise to the knee-jerk response: give them all a good bollocking; expect there will be plenty of strong words in the dressing room after that shot; wouldn't want to be standing near the manager at half-time.
We will soon look back on that view of how to improve professional athletes as comically old-fashioned, a cul-de-sac in the evolution of elite sport. After all, epic levels of discipline and commitment are non-negotiable if you want to survive as a professional sportsman today. The era of flabby, lazy athletes coasting through their careers while focusing more intently on hard living and nightclubs is pretty much over. Today's professional athletes are generally exceptionally disciplined, committed and determined. Given the scrutiny they face and the scientific testing of their bodies, there is no alternative. As a consequence, the "edge" - as gamblers describe the tiny opportunities for strategic advantage - will not reside in bullying and shouting at players but in honing their skills and freeing up their talents.
In most sporting contexts, the default position of coaches - and pundits who judge coaches in the media - is to assume that the problem afflicting a team or an individual player is usually caused by a lack of effort: if only players cared more, tried harder, felt disappointment more deeply
It is time to re-classify elite sport and stop seeing sportsmen as a rabble of unmotivated wastrels in search of a sergeant-major to whip them into shape. Athletes in highly skilled sports, in fact, have more in common with surgeons and violinists. They need mentors, wise advisors, trusted confidants. Consider the art of batsmanship. What kind of discipline is it? It requires touch, feel, finesse, trust, freedom, poise and balance. On a spectrum (with skill at one end and brute force at the other) batsmanship has more in common with playing a musical instrument than it does with punching someone in the face.
There is surprisingly little consensus about how to help elite performers to get better. Musicians, once they have reached the top, tend not to have full-time professional coaches. They rely instead on trusted mentors, people who might spot a tiny difference or lack of form. They refer to these mentors as their "outside ears", as top musicians admit that what they hear in their own heads can be different from the "real" music that reaches the audience. The mentor, though not in a position of authority over the artist, is able to see and hear with objective clarity. The relationship is based on trust not power.
Something similar - though it is called "coaching" - happens in many individual sports. In golf and tennis, the coach works for the athlete, not vice versa. This is not only a reflection of economic forces. When Roger Federer hired Stefan Edberg, he did not want the Swede to shout at him, "Try harder, Rog!" That would be useless, indeed counter-productive. Federer sought a new dimension to his net play, and Edberg, as the greatest volleyer of his generation, was asked to supply his unique perspective. The foundation of the relationship was knowledge and mutual respect.
In team sports, there is obviously a complication. The coach is usually the selector, collective tactician, and effectively in charge of hiring and firing. That changes the coach-player relationship. But not entirely. Over the long term, the best way for a coach to win the support of his players is to convince them that he can help them to play better. Appealing to their rational self-interest is the most reliable way of getting athletes on side.
The problem, of course, is that helping players score more runs and take more wickets is a rare and difficult skill. It requires astute observation, tact, judgement, and a talent for clear exposition and metaphor. Good coaches are able to articulate the same point in many different ways - until, finally, one phrase or description clicks for the athlete. A great coach, then, has more in common with a teacher than a conventional boss or employee. Ultimately, his contribution is expressed through the sum total of the improvements he makes to his players.
I never met a sportsman who preferred failure to success, nor one who didn't suffer pain at disappointment. Rare is the modern sportsman who is indifferent about the chance to get better. In today's ultra-professional and highly disciplined era, the starting point for all coaches should be the presumption: these people want to get better, how can I help them?

Friday, 28 March 2014

Think welfare spending is spiralling out of control? You're wrong

Britain's welfare spending is actually about average, while claims that it is wasteful should be seriously challenged
People enter a Job Centre in Bristol
Labour support for the welfare bill lies in the fact it 'exempts “cyclical” spending, such as unemployment benefit'. Photograph: Matt Cardy/Getty Images
With Labour voting for the government's bill to cap welfare spending, the debate on the welfare state has taken a decisively wrong turn. The issue is not the cap itself, its level, or even its design. The problem lies in the very way in which the welfare state is understood.
Even if one accepts the need for the cap, there are many problems with the way in which it is designed. Many people have rightly pointed out that the capping scheme is not as "recession proof" as it is portrayed. One defence of the bill offered by the government – and accepted by Labour as the key justification for its support – is that it exempts "cyclical" spending, such as unemployment benefit (now given the Orwellian name jobseekers' allowance). But there are other elements of welfare spending that increase in economic downturns that won't be exempt. For example, recessions may increase the need for disability benefit because more people are incapacitated due to the psychological and physical impact of unemployment, poor diet, and lack of heating.
The need for disability benefit can also be increased by an ageing population, which is one of the structural factors that are not recognised by the bill and drive up the costs of certain elements of welfare spending. It has also been pointed out that capping could be a false economy because it may increase the demands for other public services, such as education and social services, that are not covered by the bill.
Important though these criticisms are, the biggest issue is the very way in which the "problem" of the British welfare state has been defined and understood. The cap is based on the view that the UK needs "to prevent welfare costs spiralling out of control", given the wasteful nature of such spending. This is not backed up by the evidence.
The British, having supposedly invented the modern welfare state (a debatable proposition), have the mistaken notion that they have an exceptionally generous welfare state, as evidenced by the widespread worries about "welfare scrounging" and "welfare tourism". However, measured by public social spending (eg income support, pensions, health) as a proportion of GDP, Britain's is not much bigger than the OECD average; 24.1% against 22.1% as of 2009. And the OECD includes among its 34 members a dozen or so relatively poor economies – Mexico, Chile, Turkey, Estonia and Slovakia, for example – where the welfare state is much smaller for various reasons (eg younger population, weaker parties of the left).
Even when it comes to income support for the working-age population – the element targeted by the new bill – the UK is not a particularly generous place. In 2007 it spent 4.5% of GDP for the purpose. This was only slightly above the OECD average (3.9%) and way below other rich European economies: the figures were 7.2% for Belgium, 7% for Denmark, 6% for Finland and 5.6% for Sweden.
And it is not even as if the need for social spending goes away if you reduce the welfare state. For many British supporters of a smaller welfare state the role model is the US, which has a very small welfare state (considering its level of income), accounting for only 19.2% of GDP as of 2009. However, it has a huge level of private spending on social expenditure, especially medical insurance and private pensions, which is equivalent to 10.2% of GDP. This means that, at 29.4%, the US has total social spending that is almost as high as that of Finland, which spends 30.7% of GDP on it (29.4% public and 1.3% private). Moreover, if the cost is "spiralling out of control" anywhere, it is in the largely private US healthcare system, thanks to over-treatment of patients, rising insurance premiums and soaring legal costs.
Most importantly, the view that social spending is wasteful needs to be seriously challenged. The frequently used argument against the welfare state is that it reduces economic growth by making the poor workshy and the rich reduce their wealth creation, given the tax burden involved.
However, there is no general correlation between the size of the welfare state and the growth performance of an economy. To cite a rather striking example, despite having a welfare state that is 50% bigger than that of the US (29.4% of GDP as against 19.2% of GDP in the US, in 2009), Finland has grown much faster. Between 1960 and 2010 Finland's average annual per capita income growth rate was 2.7%, against 2% for the US. This means that during this period US income rose 2.7 times while Finland's rose by 3.8 times.
The point is that the welfare state – if well designed and coordinated with labour market policies to re-train people and get them back into work – can encourage people to be more accepting of change, thereby promoting growth. Firms in countries such as Finland and Sweden can introduce new technologies faster than their US competitors because, knowing that unemployment need not mean penury and long-term joblessness, their workers do not resist these changes strongly.
Most American workforces are not organised and thus incapable of resisting technological changes that create unemployment – but the minority that are organised, such as the automobile workers, resist them tooth and nail because they know that if they lose their jobs, they will not even be able to afford to go to hospital, and will find it extremely difficult to get back into the labour market at the same level.
The British debate on the welfare state needs to be recast. The false premise that the country has a particularly generous welfare state whose cost is spiralling out of control needs to be abandoned. The structural factors driving up welfare costs, such as ageing, should be accepted – rather than denied and so putting undue pressure on other elements of social services.
Above all, the debate should be redirected into reforming the welfare state in a way that promotes structural change and economic growth.

Thursday, 27 March 2014

INTERESTS IN CONFLICT - The Supreme Court and Mr Srinivasan


Earlier this week, the Supreme Court told lawyers representing the Board of Control for Cricket in India that if the Board’s president, N. Srinivasan, didn’t step down from his post voluntarily, the court would pass orders compelling him to step down. The court went further; it declared that it was “nauseating” that Srinivasan was still in office. It didn’t stop there; referring to the earlier inquiry commissioned by the BCCI into the scandal (conducted by two retired judges of the Madras High Court), the court asked rhetorically, “Can we say that the probe report was managed and if we say so, then what will be the consequences?”

The uncompromising ‘go, or else’ tone, the unusually strong language and the startling suggestion of impropriety seemed to spring from the bench’s exasperation with Srinivasan’s refusal to step aside as president for the duration of the investigation. The judges believed that the investigation into the fixing and betting scandal involving Srinivasan’s IPL club franchise, the Chennai Super Kings and his son-in-law, Gurunath Meiyappan, couldn’t be fairly conducted while he remained in office.

The story of the CSK scandal has been the chronicle of a fall foretold. If the Supreme Court had intervened decisively a few years ago, there mightn’t have been a scandal at all. The large reason why matters came to this pass is this: Indians have the greatest difficulty in agreeing upon what constitutes a conflict of interest.

The squalid sequence of events that culminated in the CSK scandal was set in motion, ironically, when the BCCI decided to amend an excellent provision in its constitution expressly intended to insulate Board officials from conflicts of interest. The clause laid down that “No administrator shall have, directly or indirectly, any commercial interest in the matches and events conducted by the Board”. The amended version specifically excluded the IPL, the Champion’s League and Twenty20 cricket.

This amendment was passed retrospectively, eight months after the inaugural bidding for the IPL franchises, to regularize N. Srinivasan’s ownership of the CSK franchise. When A.C. Muthiah, a former president of the BCCI moved the Supreme Court arguing that an administrator of the cricket board shouldn’t be allowed to own an IPL franchise because of the obvious conflict of interest, a two-judge bench of the Supreme Court delivered a split verdict. This meant that till the matter was resolved by a larger bench of the court, Srinivasan was free to simultaneously own CSK and function as president of the BCCI.
Justice J.M. Panchal was one of the judges on the two-judge bench that delivered the split verdict. His reasons for rejecting Muthiah’s petition are instructive. He ruled that no conflict of interest existed because a) no member of the BCCI or franchisee had objected to the amendment, b) the rules were framed long before the IPL was conceived of and therefore didn’t apply and c) the BCCI had suffered no financial loss because of the “so-called conflict of interest”.

To judge the force of Justice Panchal’s arguments, we need a working definition of “conflict of interest”. The standard definition cited by Wikipedia goes like this: “A conflict of interest is a set of circumstances that creates a risk that professional judgement or actions regarding a primary interest will be unduly influenced by a secondary interest.”

By the terms of this definition it seems plain that Srinivasan’s position as the treasurer of the BCCI at the time when franchises were allotted created a clear conflict of interest because as a BCCI official, he would be involved in administering a tournament in which he owned a franchise. The fact that the IPL didn’t exist when the BCCI’s conflict of interest rules were framed should have had no bearing on their applicability to the tournament. 

The whole point of having written rules is to lay down principles that allow an organization negotiate novel circumstances in an ethical way. You could even argue that the framers of the rule that Srinivasan had amended were prescient because they anticipated an IPL-like circumstance and sought to forestall it.

The absence of objections from other franchisees or members of the BCCI should have made no difference to the application of the principle. A circumstance that creates a conflict of interest exists independently of the opinions or responses of people who might be affected by it. A bunch of franchisees keen to feed at the IPL trough weren’t likely to antagonize a powerful BCCI official determined to own a franchise. Good rules — like the conflict of interest clause — help organizations achieve ethical outcomes without the need for individual heroism.

Justice Panchal’s third reason for dismissing Muthiah’s petition was that Srinivasan’s dual role hadn’t caused the board any financial loss. This conviction that a conflict of interest objection is valid only if that conflict of interest has caused actual material harm is widespread. It is also, I think, misplaced. As the Wikipedia entry on the subject goes on to say, “[t]he presence of a conflict of interest is independent of the occurrence of impropriety. Therefore, a conflict of interest can be discovered and voluntarily defused before any corruption occurs” (emphasis added).

The reason the Supreme Court should have upheld Muthiah’s objection is not because Srinivasan’s double role as administrator and franchisee had caused the BCCI any harm at the time but precisely to ensure that it didn’t harm the BCCI in the future. The risk of wrongdoing, the fact that conflicting interests can potentially corrupt motivation should have been reason enough to force Srinivasan to choose between being a franchisee or a board official. The split verdict saw the case referred to a larger bench and in the interim Srinivasan rose to become president of the board. The rest is history.

The tendency to dismiss conflict of interest charges while indignantly waving the standard of personal integrity, is epidemic in Indian cricket. Thus K. Srikkanth saw no difficulty in simultaneously being the chief of the national team and the brand ambassador of the Chennai Super Kings; Kumble was comfortable with being the chairman of the National Cricket Academy, the president of the KSCA and the director of a player management company and Dhoni, India’s captain in all three formats of the game was briefly a shareholder in a player management firm called Rhiti that counted R.P. Singh and Suresh Raina amongst its clients.

These are intelligent, successful men who seem to view the conflict of interest caution as an allegation of corruption, when it is, in fact, a principle intended to safeguard their reputation and integrity. This isn’t surprising: people take their cues from the men at the top and BCCI’s president isn’t just the supremo of Indian cricket and the owner of Chennai Super Kings, he is about to become the chairman of the International Cricket Council. If Srinivasan’s colossal conflict of interest could be retrospectively legitimized and glossed over by the BCCI without swift corrective action by the courts, why should anyone involved in Indian cricket declare a pecuniary interest for the sake of transparency or recuse himself from situations that create a conflict of interest?

Now that the Supreme Court, spurred on by the Justice Mudgal report, has brusquely declared that Srinivasan’s presidency can’t be reconciled with a fair investigation of the CSK scandal, the scandal begins to seem like a cautionary tale. Instead of talking about the potential for wrong-doing created by Srinivasan’s conflict of interest and trying to forestall it, the courts and the police are now dealing with allegations of actual wrong-doing. The amendment that gelded the conflict-of-interest clause by exempting the IPL was the original sin: it led directly to Srinivasan’s fall and it’s responsible for the collateral damage to cricket’s credibility.

Will the example of the apex court encourage Indian cricket’s many publicists to press for a reinstatement of the original clause? Will it help them speak truth to power? I wouldn’t hold my breath: Lalit Modi’s downfall didn’t reform the BCCI: its publicists and clients switched their loyalties to Srinivasan without missing a beat. Conflicts of interest can be fixed; servility is a permanent condition.

Wednesday, 26 March 2014

Inherited wealth is an injustice. Let's end it

Inheritance, which rewards the wealthy for doing nothing, is once again becoming a key route to riches – just as it was in the Victorian era
Hands dropping coins
'The transfer of wealth between generations allows access to privileges that are otherwise beyond reach.' Photograph: Cultura Creative (RF) / Alamy/Alamy
Inherited wealth is the great taboo of British politics. Nobody likes to talk about it, but it determines a huge number of outcomes: from participation in public life, to access to education, to the ability to save or purchase property. When David Cameron recently promised to raise the threshold for inheritance tax to £1m and praised "people who have worked hard and saved", he is singing from the hymn sheet of inherited inequality: it is, after all, easier to save if you inherit substantial sums to squirrel away, or if you can lock money in property that is virtually guaranteed to offer huge returns. Hard work has very little to do with it.
In 2010-11, the most recent period for which we have figures, 15,584 estates of 259,989 notified for probate paid inheritance tax. That is approximately 3% of all deaths that year. Already, inheritance tax is paid by a tiny fraction of all estates. The asset composition of these estates remains stable over time, with property composing about 50% of taxable estates; a disproportionate number of these are located in London and the south-east, reflecting the rocketing house prices in that corner of the country. The "nil-rate threshold" – the value under which inherited wealth is untouched by tax – currently stands at £325,000, frozen since April 2009. But that's only half the story. Since 2007, it has been possible for spouses to transfer their unused nil-rate band allowance to their surviving partner. This has lifted many estates in the £300-500,000 band out of inheritance tax altogether: at this point we are beginning to talk about substantial, indeed life-altering, sums of money.
Beyond these key figures lies a hinterland of tax-minimisation strategies through which assets can be exempted from tax, including various types of trust and business property relief. Despite nominal efforts to curb this kind of minimisation, there remains a booming market in financial advice tailored to avoidance. The knock-on effects of this minimisation are huge: it permits further concentration of wealth in the hands of those who already possess it, rewarding those cunning enough to avoid taxation, and cushioning their children with an influx of unearned wealth. There are obvious uses to which this can be put: paying off student loans early, thus avoiding interest, investing in buy-to-let property, or high-return financial products. It permits the children of the middle classes to sustain themselves through unpaid internships or unfunded study into secure middle-class careers, while locking these off from those without such resources. Given the chancellor's recent changes to pensions, the flow of cash into property as a secure income stream for the already wealthy is only likely to increase. Again, despite the rhetoric, this has little to do with hard work, but the preservation of wealth gaps between classes.
Why do we permit this? The transfer of wealth between generations is an injustice: it is a reward for no work, and a form of access to privileges that are otherwise beyond reach. Professor Thomas Piketty, in his new book Capital in the Twenty-First Century, makes the argument that, after a social-democratic blip in the middle of the last century, inheritance is once again becoming the key route to wealth. Piketty argues that if wealth is concentrated and the return on capital is higher than the economy's growth rate, inherited wealth will grow more rapidly than that stemming from work. This returns us to the terrain of Balzac and Austen, where the road to financial security is to target those who already possess wealth and, where possible, marry them. The data Piketty analyses – a huge and comprehensive set – suggests that the proportion of people receiving a sum in inheritance larger than the lifetime earnings of the bottom 50% is set to return to 19th-century levels in the next couple of decades. Pleasant news for our neo-Victorian government; less pleasant for the rest of us, and a disaster for anyone who cares about inequality.
It is difficult to justify inherited wealth from anything other than a class-partisan position. It is the point where the already threadbare veil of "meritocracy" falls off to reveal a fiscal system designed to reward already concentrated pots of wealth. Far from a Keynesian "euthanasia of the rentier", we are seeing the triumph of a rentier economy: in such conditions, rather than further accumulation by the sons and daughters of the wealthy, we should instead demand an end to inherited wealth entirely.

The banality of evil

Illustration: Deepak Harichandan
The HinduIllustration: Deepak Harichandan

When carnage is reduced to numbers and development to just economic growth, real human beings and their tragedies remain forgotten.

Empires collapse. Gang leaders/Are strutting about like statesmen. The peoples/Can no longer be seen under all those armaments — Bertolt Brecht

German-American philosopher Hannah Arendt gave the world the phrase, “the banality of evil”. In 1963, she published the book Eichmann in Jerusalem: A Report on the Banality of Evil, her account of the trial of Adolf Eichmann, a Nazi military officer and one of the key figures of the Holocaust. Eichmann was hanged to death for war crimes. Arendt’s fundamental thesis is that ghastly crimes like the Holocaust are not necessarily committed by psychopaths and sadists, but, often, by normal, sane and ordinary human beings who perform their tasks with a bureaucratic diligence.

Maya Kodnani, MLA from Naroda, handed out swords to the mobs that massacred 95 people in the Gujarat riots of 2002. She was sentenced to 28 years in prison. She is a gynecologist who ran a clinic, and was later appointed as Minister for Women and Child Development under Narendra Modi.

Jagdish Tytler was, allegedly, one of the key individuals in the 1984 pogrom against the Sikhs. He was born to a Sikh mother and was brought up by a Christian, a prominent educationist who established institutions like the Delhi Public School. A Congress Party leader, he has been a minister in the Union government. The supposedly long arm of law has still not reached him. Guess they never will, considering that the conviction rate in the cases for butchering nearly 8000 Sikhs is only around one per cent.

For every “monstrous” Babu Bajrangi and Dara Singh, there are the Kodnanis and Tytlers. Evil, according to Arendt, becomes banal when it acquires an unthinking and systematic character. Evil becomes banal when ordinary people participate in it, build distance from it and justify it, in countless ways. There are no moral conundrums or revulsions. Evil does not even look like evil, it becomes faceless.

Thus, a terrifyingly fascinating exercise that is right now underway in the election campaign is the trivialisation and normalisation of the Gujarat pogrom, to pave the way for the crowning of the emperor, the Vikas Purush. If there was some moral indignation and horror at the thought of Narendra Modi becoming prime minister until recently, they have been washed away in the tidal wave of poll surveys, media commentaries, intellectual opinion, political bed-hopping, and of course, what the Americans think, all of which reinforce each other in their collective will to see Modi ascend to power.

Banalisation of evil happens when great human crimes are reduced to numbers. Thus, for example, scholars Jagdish Bhagwati and Arvind Panagariya write a letter to The Economist on the latter’s article on Modi: “You said that Mr. Modi refuses to atone for a ‘pogrom’ against Muslims in Gujarat, where he is chief minister. But what you call a pogrom was in fact a ‘communal riot’ in 2002 in which a quarter of the people killed were Hindus”. So, apparently, if we change the terminology, the gravity of the crime and the scale of the human tragedy would be drastically less!

This intellectual discourse is mirrored in ordinary people who adduce long-winded explanations for how moral responsibility for events like the Gujarat pogrom cannot really be attributed to anybody, especially the chief minister, who is distant from the crime scene. No moral universe exists beyond the one of “legally admissible evidence”. To be innocent means only to be innocent in the eyes of law. But what does evidence mean when the most powerful political, bureaucratic, and legal machineries are deployed to manipulate, manufacture and kill evidence as seen in both the 2002 and 1984 cases?

Another strategy of banalisation is to pit the number of dead in 2002 with that of 1984 (Bhagwati and Panagariya go onto assert that 1984 “was indeed a pogrom”). Modi’s infamous response to post-Godhra violence is countered with Rajiv Gandhi’s equally notorious comment after his mother’s assassination. In this game of mathematical equivalence, what actually slip through are real human beings and their tragedies.

Banalisation of evil happens when the process of atonement is reduced to a superficial seeking of apology. Even when that meaningless apology is not tendered, we can wonder to what extent reconciliation is possible.

The biggest tool in this banalisation is development. Everyday, you see perfectly decent, educated, and otherwise civil people normalise the Gujarat riots and Modi, because he is, after all, the “Man of Development”. “Yes, it might be that he is ultimately responsible for the riots, but look at the roads in Gujarat!” It is a strange moral world in which roads have moral equivalence to the pain of Zakia Jaffrey and other victims.

Ironically, along with evil, development itself becomes banal. Development becomes hollowed and is reduced to merely economic growth. E.F. Schumacher’s famous book Small is Beautiful has a less famous subtitle, A Study of Economics as if People Mattered. But when development is banal, people do not matter. Nor does the ecosystem. There are no inviolable ethical principles in pursuit of development. If Atal Behari Vajpayee was the mask of the BJP’s first foray into national governance, development becomes the mask of the Modi-led BJP’s present attempt, and a façade for the pogrom.

But what is fascinating is how such a banal understanding of development has captured public imagination. The most striking aspect of the Gujarat model is the divergence between its growing economy and its declining rank on the Human Development Index (HDI). For instance, in the UNDP's inequality-adjusted HDI (2011) Gujarat ranks ninth in education and 10th in health (among 19 major states). On gains in the HDI (1999-2008), Gujarat is 18th among 23 states. In the first India State Hunger Index (2009), Gujarat is 13th out of 17 states (beating only Chhattisgarh, Bihar, Jharkhand and Madhya Pradesh).

Yet, shockingly, prominent economists like Bhagwati participate in this banalisation by glorifying the Gujarat model. His response to the poor record of Gujarat is that it “inherited low levels of social indicators” and thus we should focus on “the change in these indicators” where he finds “impressive progress”. If so, how is it that many other states starting off at the same low levels have made much better gains than Gujarat without similar economic growth?

These figures and others about a whole range of human deprivation are in the public domain for some time, but, astonishingly, are not a matter of debate in the elections. Even if they were, they would not apparently dent the myth of the “Man of Development”. Such is the power of banalisation that it has no correlation with facts.

Even as the developed countries are realising the catastrophic human and environmental costs of the urban, industrial-based models of boundless economic growth (in America, the number of new cancer cases is going to rise by 45 per cent in just 15 years), we are, ironically, hurtling down the same abyss to a known hell — India fell 32 ranks in the global Environmental Performance Index to 155 and Delhi has become the most polluted city in the world this year! The corporate-led Gujarat model is an even grander industrial utopia based on the wanton devastation of mangroves and grazing lands.

In a recent election opinion poll, the three most important problems identified by the voters in Punjab were drug addiction (70 per cent), cancer caused by pesticides (17 per cent) and alcoholism (nine per cent)! This is shocking and unprecedented, and it stems from the fact than an estimated 67 per cent of rural population in Punjab had at least one drug addict in each household. Nevertheless, the juggernaut of development as economic growth careens on.

Disturbingly, the scope of questioning this banalisation of evil and development diminishes everyday. Many reports emerge about the self-censorship imposed by media institutions already in preparation for the inauguration of a new power dispensation. A book which raises serious questions about the Special Investigation Team’s interrogation of Modi hardly gets any media attention and, instead, is dismissed as propaganda against the BJP. It does not matter that the same journalist subjected the investigation in the anti-Sikh pogrom to similar scrutiny. And the pulping of the book on Hinduism by a publisher portends dangerous tendencies for the freedom of speech and democracy in the country.

The vacuity of the attempts to counter the banalisation of development is evident in the media discourse on elections. Just sample the much-lauded interview conducted by the nation’s conscience keeper with Rahul Gandhi. In a 90-minute conversation, Arnab Goswami could ask only a single question on the economy — on price rise. This is in a nation, which, on some social indicators, is behind neighbours like Sri Lanka, Nepal and Bangladesh. Elections are not about the substantive issues of human well being, environmental destruction, and ethics, but are reduced to a superficial drama of a clash of personalities.

Fascism is in the making when economics and development are amputated from ethics and an overarching conception of human good, and violence against minorities becomes banal. Moral choices are not always black and white, but they still have to be made. And if India actually believes this election to be a moral dilemma, then the conscience of the land of Buddha and Gandhi is on the verge of imploding.

Leasing out Pakistan

Najam Sethi  TFT Issue: 21 Mar 2014

Leasing out Pakistan

The Saudi Kingdom has granted $1.5b to the Nawaz Sharif government. Another such donation will accrue in due course. A quick fix of $3b is a lot of free money for Pakistan’s forex-strapped economy that is struggling to cope with significant international debt payments and a rising trade gap that is putting pressure on the rupee and fuelling inflation. Indeed, the Saudi injection has reversed the rapid fall of the rupee, proving that the finance minister, Ishaq Dar, was not bluffing when he warned exporters six weeks ago not to hoard their dollars. Why then all the hush-hush about the Good Samaritan who has eventually bailed him out?
Significantly, the PMLN government has been at pains to hide the Saudi largesse. But after we discovered that the cause of the sudden reversal in the fortunes of the rupee was due to an uplifting shot in the arm of the State Bank, we were told not to ask about the “friendly” source and amount of funds. Then, after we found out about the donor, we were told that the Saudi “donation” was a measure of the personal relationship between our prime minister and the Saudi monarch. That is when our happy surprise turned to suspicious incredulity and the game became crystal clear.
A clutch of high-powered Saudis, including the Crown Prince, has descended upon Islamabad in recent weeks. The prime minister and the Pakistan army chief have made unexplained flying visits to the Kingdom. In due course a joint statement or communiqué was issued from Islamabad stressing the demand for a “transitional” government in Syria while emphasizing that there was no change in Pakistan’s position on the issue. Indeed, the foreign office spokesperson, an apparently haughty lady, was quite aggressive in ticking off inquiring hacks who argued that the demand for a transitional government amounted to a veritable “regime change” in Syria and smacked of a definite policy about-turn. Mr Sartaj Aziz, the de facto foreign minister, has also executed some verbal gymnastics to try and obscure the truth. But we, the public, are not stupid or ill-informed. We are not ready to buy this story hook, line and sinker. We know there are no free lunches, let alone free feasts, in relations amongst nations. So what’s the $3b quid pro quo?
The truth is that Pakistan has agreed to supply, among other weapons, anti-aircraft and anti-tank rockets to the Saudis. Mr Aziz says the End-User Certificate conditions will guarantee that these are not used outside Saudi Arabia. This is a load of nonsense. Why the Saudis should suddenly turn to Pakistan for these weapons when traditionally they have tapped the US and Europe has, however, given the game away. These potential game-changing weapons are clearly meant for use by Saudi-backed Wahhabi-Salafist rebels in Syria who are fighting to overthrow the Baathist secular Asad regime. The Americans haven’t supplied the Saudis because they don’t want such radical Islamist forces any more than Al-Qaeda to succeed in Syria and are therefore having serious second thoughts about regime change in Syria. Indeed, the Saudis’ sudden embrace of Pakistan portends shifting sands in the Middle-East.
The Saudis and the Emirates-Gulfdoms are feeling insecure because of the Shia revival in their heartlands. This is because the restless Shias are sitting on their oil reserves. Iran, too, is unremitting in opposing Saudi influence. Iraq and Qatar, two competitive energy suppliers, are not playing ball either. Egypt and Libya haven’t bought into the Saudi Islamist line. Worse, the Americans are seeking negotiated nuclear solutions in Iran instead of succumbing to Saudi pressure for military action. And American self-reliance on shale gas is the first definite step against continued dependence on Saudi oil.
On the heels of the Saudi VVIPs now comes the King of Bahrain to Islamabad. The PMLN government claims that foreign investment deals are in the offing. But the small print betrays the real motive behind “renewed manpower exports”. The Bahraini Emir wants well-trained and equipped Pakistani military mercenaries to beef up his police and security forces to repress the rising democratic impulses of the majority Shia populations. It is as simple as that.
It is the same old treacherous story. Since independence in 1947, the Pakistani ruling classes and military establishment have lived off rents from leasing out their “services” to the highest foreign bidder instead of standing on their own feet and not meddling in other peoples business. In the 1950s, 60s and 80s, they sold their services to the Americans, first against the USSR and then against the Taliban; now, in the 2010s, they are rolling up their sleeves to stir the Middle-East cauldron at the behest of a rich “friend”. The extremist Sunni blow back from the first lease to the US in the shape of the Taliban, Al-Qaeda and Lashkar-e-Jhangvi is now primed for escalation and blow back during the proposed second lease to the Saudi-Emirates network. We are making another irrevocable blunder, so help us Allah. 

Tuesday, 25 March 2014

Interview with Gail Tredwell

A former member of the inner circle of Amritanandamayi group, Gail Tredwell reveals what routinely happened in the camp during her time there.

Is she stating  the truth?


As the Amritanandamayi members state 'is she being manipulated' to malign the movement?

Probably, one needs a judicial enquiry to set the record state. But given the way the allegations against Satya Sai Baba were treated one's hopes are.....

Will Pakistan become a Taliban State?

Interview with Arshad Mahmood

Monday, 24 March 2014

Has Modi's Gujarat grown faster and better than the rest of India?

Two academics hold Gujarat up against other states to see if it grew more in the Modi decade than in the preceding 20 years

The forthcoming election, it seems, will be fought mainly on issues of governance and economic performance. To the extent there is a focus on the personalities involved, such as Narendra Modi or Rahul Gandhi or Arvind Kejriwal or potential ‘Third Front’ candidates such as Nitish Kumar or Mamata Banerjee, most of the discussion is about their economic track record or lack thereof. This is a welcome development. However, in the grand theatre of Indian politics, facts often take a backseat to slogans, and opinions get sharply polarised. For example, we either hear that Gujarat’s economic performance has been nothing short of miraculous due to the magic touch of Modi or that Gujarat’s so-called growth story is all hype and a PR campaign aimed at covering up a dark underbelly of poverty, inequality and low levels of human development indicators.

A lot of this debate reflects disagreements about two sets of issues. First, there are many dimensions of economic performance—we could look at the level of per capita income, the growth rate of per capita income, human development indices (HDI) that put weight on not only income but also on non-income measures like education and health, the level of inequality, percentage of people below the poverty line, and many others. Which index we choose to emphasise reflects either our preferences as to the aspect of economic performance we value the most, or our views as to which dimension has to be improved (say, per capita income) for bettering the dimension we care about (say, poverty alleviation).
Secondly, even if we focus on one particular dimension of economic performance, how do we attribute changes in this dimension to the role of a specific leader? For example, how do we isolate the contribution of Narendra Modi and Nitish Kumar to the growth of Gujarat and Bihar, respectively, in the 2000s, especially as the country as a whole experienced a growth spurt in this period?

Therefore, the first issue is how to separate the leader’s contribution from other factors driving his or her state’s performance, for example, a general improvement in the economic environment of the country that benefits all states. The solution to this problem is to calculate the difference between the growth rate of the state for the years this leader was in power and the average growth rate of the rest of the states during the same period of time. If this difference is positive, then it is safe to say that the state under this leader grew faster than the rest of the country.

However, this is not enough. What if the state in question was always growing faster than the rest of the country? How can we then isolate the specific role of this leader?

To give an analogy, to show that a company’s performance under a new CEO has improved, it is not sufficient to show that the performance of the firm has been above average rel­ative to that of other firms after the new CEO took over, as it is possible that this firm was already ahead of others. Sim­ilarly, if we find that a firm beat its past record under the new management, we cannot automatically attribute this to the CEO, as it is possible that all firms performed better in this period due to positive changes in the economic environment. To claim that this CEO had a transformative impact on the firm, we need to show not only that this firm stayed ahead of other firms after he took over but that its performance margin relative to other firms improved significantly under him.

Thus, returning to the example of Modi, in order to claim that his leadership had a significant impact on Gujarat’s economic performance, it is not enough to show that the state did better than the rest of India after he came to power in 2001. We have to demonstrate that the gap between Gujarat’s performance and that of the rest of India actually increased under his rule. This is a statistical method called ‘differences in differences’. It is routinely used to evaluate the performance of organisations under a particular management or the effectiveness of a particular government policy.

Turning to evidence, we look at the following key indices of economic performance—level of per capita income, its growth rate, HDI, inequality and the percentage of population below the poverty line—for the major Indian states. All through, we have focused on the major 16 states in terms of population. The larger a state, the harder it is to achieve improvements in per capita average economic indicators. Therefore, comparing a large state like Uttar Pradesh and a small one like Nagaland can be misleading; it is better to compare like with like. However, we have to keep in mind that even among the major states, turning around a state with a larger population is a harder task.

We begin by looking at the most obvious economic indicator—the level of per capita income. In terms of average per capita income ranking of states over the 1980s, ’90s and 2000s, the top three states are Haryana, Punjab and Maharashtra (see Table 1). Gujarat’s average rank is 4. On the other hand, Bihar, which has been in the news lately due to its spectacular turnaround over the recent years under the leadership of Nitish Kumar, has been consistently at the bottom of this league with a rank of 16, below UP, which too has remained steady at number 15.

In terms of improving their relative ranking over the three decades, the top performers among the leading states are Maharashtra, Gujarat, Kerala and Tamil Nadu. Between the ’80s and now, Maharashtra has moved from 3 to 1, Gujarat from 4 to 3, Kerala from 10 to 5 and Tamil Nadu from 7 to 4. Interestingly, the rise in the ranks of these four has been accompanied by the relative decline of Punjab, which went from being the very top state in the ’80s and ’90s to No. 7 in 2010. This suggests that, as in athletic races, the relative rank of a state may go up or down either due to a change in its own performance or due to a change in the rival’s performance.

Thus, to obtain a fuller picture of the economic performance of these states, we also need to consider their relative growth performances. The relative ranking at a given point of time as in Table 1 gives only a snapshot of where states stand in terms of economic performance. But as we know from athletic races, unless that point happens to be the finishing line, it is the rate at which an athlete is accelerating that determi­nes the final outcome. While there is no final finishing line in the race of economic development, the current growth performance of a state can give an indication of its potential position in the future. Is the rise in rankings of states like Maharashtra and Gujarat also matched by a faster growth rate on their part? Also, are there states that are lower down in the ranking but are growing faster than average and so can hope to improve their ranking in the future?

Table 2 documents the annual average growth rates of states which have performed better than national average (leaders) in each of the three decades. Only three states have had above average growth performance in all three decades: Gujarat, Tamil Nadu and Maharashtra. They were joined by Andhra Pradesh, Bihar, Haryana and Kerala in the 2000s.
Interestingly, the growth rate of Punjab, initially one of the top-ranked states in terms of per capita income level, has been below the national average in the last two decades. Thus it is not surprising that it is slipping down in rank below other faster-growing states. Bihar, on the other hand, is poised to rise up the ranks with a higher than average growth rate of per capita income in the 2000s. In a way, Bihar’s story is the opposite of Punjab’s: while it is still at the bottom of the chart in terms of the level of per capita income, it can expect to improve its rank if it maintains its recent high growth rate.

Now we come to one of the key questions. Which are the states that improved their performance in the 2000s both with respect to their past performance in the earlier two decades, and with respect to the performance of other states in the 2000s? Table 3 graphically plots the average annual growth rates of five states against the national average over time. This graph shows an interesting trend: while Gujarat, Tamil Nadu and Maharashtra have been going neck and neck (and Haryana, which is not shown in the figure), and as already mentioned, have consistently performed above the national average, none of them has experienced a huge acceleration in growth rate in the 2000s. In contrast, Bihar, which was consistently doing worse than the national average through the ’80s and ’90s, shot up above the national average in the 2000s, converging to rates achieved by established leaders like Gujarat, Maharashtra and Tamil Nadu.

To sum up, we see that Maharashtra, Haryana, Punjab, Gujarat and Tamil Nadu have been among the richest states in the last three decades. In the 2000s, the big news was Punjab dropping from the top 5 and Kerala breaking into this select group. Among the rest, Maharashtra ended as the topper in the latter half of the 2000s, and Gujarat at a very respectable number 3, after Haryana. In terms of growth performance, Gujarat, Tamil Nadu and Maharashtra were the toppers over the last three decades but in the 2000s, three other states raised their game to join the list of fastest-growing states: Bihar, Haryana and Andhra Pradesh. However, if any state could claim that its performance relative to the rest of India actually improved in the 2000s, that state is Bihar.

Therefore, if awards must be given, Bihar deserves the prize for the most dramatic turnaround in the 2000s. Gujarat gets credit for having steadily been on top of the league in terms of both the level of per capita income and its growth rate, but has to share the honours with Maharashtra and Haryana in that category. However, there is no evidence of any significant growth acceleration in Gujarat in the 2000s.

One could argue that it is easier to turn around a state that was at the bottom of the league like Bihar than to maintain, or to marginally improve, the performance of a state already at the top of the league, like Maharashtra, Haryana or Gujarat. After all, there is greater scope for improvement in the former case. Conversely, one could also argue that it is more challen­ging to turn around a backward state, because if it were easy, someone would have done it already. This is reinforced by the argument that Bihar is the third largest state, whereas Guj­arat’s rank is 10th in terms of population, and it is difficult to achieve sharp improvements in a larger than a smaller state.

Be that as it may, many would argue that per capita income and its growth—the indices we have considered so far—are only partial measures of economic development. Among other things, these indices ignore aspects of development that are not captured in income, for example, life expectancy or education. Nor do these take into account income inequality or the extent of poverty. Therefore, we now turn our attention to the performance of the states in terms of the Human Development Index (HDI), level of inequality and the percentage of people below the poverty line.

Table 4 highlights HDI scores of the seven states with HDI scores above the national average over the last three decades. These are Kerala, Punjab, Maharashtra, Haryana, Tamil Nadu, Gujarat and Karnataka. Table 5, on the other hand, plots the performance of some selected states with respect to the all-India average in terms of HDI. As we would expect, Kerala’s performance is literally off the charts. Maha­rashtra, Tamil Nadu and Gujarat,  on the other hand, appear to have been going head to head. Their trends tell an interesting story. While Gujarat’s HDI performance was above the national average in the ’80s and ’90s, it decelerated in the 2000s and came down to the national average. In contrast, Tamil Nadu and Maharashtra, which started off at a similar level of HDI as Gujarat in the ’80s, have continued to perform better than the national average in the 2000s. Bihar, on the other hand, has consistently been below the national average, but it has made significant improvements over the last decade and shows signs of catching up to the national average.

Thus, the HDI rankings of states present a different story than their rankings of per capita income levels or growth rates, with one exception. The only state that is in the top 3 in all the rankings so far is Maharashtra. Otherwise, the top prize for HDI goes to Kerala, and “the most improved in the 2000s” prize goes to Bihar.

Next, we look at a few states’ ranking in terms of level of inequality (see Table 6) based on consumption expenditure. Assam and Bihar have consistently had the lowest levels of inequality according to this index. However, the state that really stands out, both in terms of relative ranking and absolute decline in inequality, is Rajasthan. Between the early ’80s and late 2000s, Rajasthan’s relative ranking improved from 15th to third, while its inequality measure fell by 14 per cent, the largest decline for any state. On the contrary, states that are leaders on the growth dimension are found to perform worse on inequality. For example, it’s evident from Table 7 that while inequality in Gujarat was lower than the national average in the ’80s and ’90s, it actually rose to levels above the national average in the 2000s. Maharashtra, Tamil Nadu and Kerala, too, have consistently recorded higher levels of inequality than the rest of India, with Kerala showing a sharp spike in the 2000s.

Lastly, we consider the percentage of population below the poverty line (see Table 8). We find that Himachal Pradesh, Punjab, Kerala, Gujarat, Haryana, Andhra Pradesh and Karnataka have consistently had lower levels of poverty than the all-India average. Gujarat’s performance in poverty reduction over the years has been similar to that of Andhra Pradesh and Kerala. However, if we look at improvements in performance over the last decade, then Tamil Nadu is one of the top performers. Starting from a level of poverty that was higher than the national average in 1983, it ended up at a much lower level, similar to those of Gujarat, AP and Kerala, in 2009 (see Table 9). Bihar, although well above the national average in terms of poverty levels all through the three decades, has shown a sharp improvement over the last decade.

Is there, then, a clear answer to the question we had started with: did Gujarat truly outshine other states in the 2000s in terms of economic development? If we simply look at the figures, four facts will jump out: first, Bihar has improved the most in the 2000s, even though it has been at the bottom of the list for all indicators and still has a fair distance to go before it can go above the national average; second, Kerala has far outpaced other states in terms of HDI all through; third, Rajasthan was the star performer in terms of reducing inequality; and fourth, Maharashtra and Gujarat have consis­tently been top performers in terms of per capita income and its growth, with Haryana and Tamil Nadu deserving mention too. All these achievements are noteworthy but it is hard to single out any state as the top performer in the 2000s.

To the extent this assessment goes against the view held by many people independent of their political leanings that Gujarat has done spectacularly well under Mr Modi, the explanation lies in our ‘differences in differences’ app­roach.
In particular, this is what we tried to figure out: did a state that has for a long time been one of the most developed states in terms of per capita income, and was already improving at a rate higher than the rest of the country, accelerate further and significantly increase its growth margin under Modi’s stewardship? Our analysis shows that this did not happen. Both Maharashtra and Gujarat improved upon an already impressive growth trajectory in the 2000s, but the margin of improvement was too small to be statistically meaningful. So while Gujarat’s overall record is undoubtedly very good all through the last three decades, its performance in the 2000s does not seem to justify the wild euphoria and exuberant optimism about Modi’s economic leadership.

Of course, it is possible that there are trends that this evidence cannot capture. Maybe with a longer time horizon, the effects of some of Modi’s policies will show up in the evidence, although given that he is now in his fourth consecutive term of power, this argument is not very strong. It is also possible that if Modi comes to power at the Centre, he may well achieve a turnaround of the Indian economy due to his governance style. All that is possible in theory, but the existing evidence is insufficient to support these views.
As John Maynard Keynes had famously said in the context of stockmarket bubbles, often our decisions to do something, the full consequences of which will be drawn out over many days to come, can only be “taken as the result of animal spirits”—a spontaneous urge to action rather than inaction or rational calculation. In politics, too, maybe it is animal spirits that rule, not rational calculations based on statistical evidence. However, while election campaigns are run on slogans and sentiments, good governance depends on facts and figures. Bubbles eventually burst, waves of euphoria recede. At some point, the numbers need to add up.

By Maitreesh Ghatak and Sanchari Roy
(Maitreesh Ghatak is Professor of Economics at the London School of Economics; Sanchari Roy is a research associate at the Department of Economics, University of Warwick, UK.)