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Friday 10 July 2009

Is Nehru Coming Back?


  

Looking at the ongoing world-wide economic crisis and serious attempts at exploring ways and means to overcome it now and prevent it from recurring in the future, the return of Nehruvian approach seems to be a strong probability. Jawaharlal Nehru's return from exile after more than a quarter of a century has been forecast by none other than the greatest living historian Eric J. Hobsbawm in an article 'Socialism has failed. Now capitalism is bankrupt. So what comes next?' (The Guardian, April 10).

 

It will be interesting to note that it is the same Jawaharlal Nehru, the process of whose banishment was begun by the first non-Congress government, headed by Morarji Desai and joined by Charan Singh, the self-appointed guardian of Indian peasantry besides all sorts of Nehru baiters from the followers of Dr. Lohia to the RSS, in addition to some frustrated ex-Congressmen. This process got accelerated during the regime of P. V. Narasimha Rao when India embarked on economic reforms, inspired by the ten points of the Washington consensus, reached between the 15th and 19th streets of Washington, DC and formulated by John Williamson. A horde of economists and propagandists descended from America on India, especially New Delhi and Mumbai with their baggage of received wisdom. Some could manage entry into the corridors of policy-making process while others began spreading their wisdom through the media.

 

The collapse and disintegration of the Soviet Union, the virtual death of NAM and withering away of Congress Socialist Forum besides financial bankruptcy of the country, brought about by the V.P. Singh-Chandrashekhar governments had so demoralized the intelligentsia that, rightly or wrongly, it came to believe that there was no alternative to what was being done in the name of reforms. People like Gurcharan Das, a former sales executive of the US multinational, Procter and Gamble, arrived with his book India Unbound, blaming Nehru and his policies for all the economic ills of India. The book was showered with praises by protagonists of the Washington consensus, but eminent economists like Amartya Sen and Dani Rodrik pointed out the absurdities in Das's claims. Sociologist Dipankar Gupta logically countered the formulations and conclusions of Das by publishing his forceful book Mistaken Modernity. Yet the corporate-controlled media went on applauding him. The grapevine has it that he is soon coming up with a new book which is said to have traced the roots of the Washington consensus to the Mahabharata. One may recall that a former chief of the RSS had written a piece that was included by the then BJP government of Rajasthan in a school text book. It had asserted that nuclear weapons existed in ancient times in India and there was a non-proliferation treaty whereby only Brahmins and Kshatriyas were allowed to use them. As ill luck would have it, there was a big uproar in Parliament and this "great discovery" was deleted.

 

Let us turn our attention to Eric Hobsbawm. He says, even though we are living in the 21st century, we are still in the grip of the basic ideas that are no longer credible. In fact they have "patently disappeared down the plughole of history." We have made two practical attempts to realize our ideal socio-economic formation in their pure forms. They were "the centrally state-planned economies of the Soviet type and the totally unrestricted and uncontrolled free-market capitalist economy. The first broke down in the 1980s, and the European communist political systems with it. The second is breaking down before our eyes in the greatest crisis of global capitalism since the 1930s. In some ways it is a greater crisis than in the 1930s, because the globalization of the economy was then not as far advanced as it is today, and the crisis did not affect the planned economy of the Soviet Union. We don't yet know how grave and lasting the consequences of the present world crisis will be, but they certainly mark the end of the sort of free-market capitalism that captured the world and its governments in the years since Margaret Thatcher and President Reagan.

 

"Impotence therefore faces both those who believe in what amounts to a pure, stateless, market capitalism, a sort of international bourgeois anarchism, and those who believe in a planned socialism uncontaminated by private profit-seeking. Both are bankrupt. The future, like the present and the past, belongs to mixed economies in which public and private are braided together in one way or another. But how? That is the problem for everybody today, but especially for people on the left."

 

The "pure, stateless, market capitalism" had different names in different countries. New Labour in Britain believed that socialism was irrelevant because the new strategy would generate more wealth and social-democrats had to see that it was equitably distributed. In India, the 10 points of the Washington consensus were dished out in the garb of economic reforms. Consequently, jobless growth became prominent, regional disparities and social inequalities increased rapidly. Vulgar display of wealth and ostentatious living styles became the norm. All these led to increase in corruption, crimes, kidnappings for ransom, terrorist activities and regional chauvinism.

Anand Giridhardas in International Herald Tribune (April 10, 2009) observes in the context of the ongoing economic crisis: "I worry far more for the developing world, for places like India, which has been mimicking the American superstructure without building an equivalent foundation, pursuing the effect without the cause.

 

"India seems, on the surface, to have arrived. There are the requisite global luxury boutiques; restaurants that serve sophisticated food in tiny portions with something called coulis drizzled across the plate; Indian firms that make multi-billion dollar acquisitions; software companies that write code for the world; songs that win Oscars and hearts many thousands of miles away.

 

"But perhaps it has all come too quickly, and served to crowd out the hard slog of constructing a modern society in more than name alone. Yes, India has Louis Vuitton, but how easy is it to be gay there? Yes, its companies have dazzled the world, but why do their workers complain still about the hierarchical, soul-draining work culture? Yes, it won an Olympic gold medal last year, but why has it been so hard to recast servants as people paid, not born, to serve?"

 

We have to ponder over the economic strategy we have pursued since 1991, after banishing Nehru. If we want a prosperous India for all, we have no alternative but to give up the belief that private profit-making enterprise is always better, more efficient way of doing things. We have to, in the words of Hobsbawm, "return to the conviction that economic growth and the affluence it brings is a means and not an end. The end is what it does to the lives, life-chances and hopes of people.... The test of a progressive policy is not private but public, not just rising income and consumption for individuals, but widening the opportunities and what Amartya Sen calls the "capabilities" of all through collective action. But that means, it must mean, public non-profit initiative, even if only in redistributing public accumulation. Public decisions aimed at collective social improvement from which all human lives should gain. That is the basis of progressive policy - not maximizing economic growth and personal incomes."

 

Prof. Amit Bhaduri in a recent article "A Failed World View" in Economic and Political Weekly (January 31, 2009) has very convincingly argued that the very basis - the Washington consensus - of our economic reforms and strategy is flawed and is not going to satisfy the masses of this country who look towards the Congress-led UPA for eradication of poverty, rapid increase in job-opportunities, lessening of regional imbalances and inequalities in the distribution of income and wealth. Liberalisation, privatization and unbridled profit motive cannot fulfill their aspirations. Planning and public sector have to be revived and state has to intervene effectively in the removal of regional disparities in development.

 

It is high time that Nehru is brought back and the Washington consensus and their votaries are given a goodbye. All those experts roaming in the corridors of power and advocating full convertibility of rupee on capital account and privatization of public sector commercial banks should be politely told to go back. The G-20 summit on April 2 in so many words underlined the irrelevance of the Washington consensus and asserted the increased role of state in economic affairs. Now with elections over and a popular government in the saddle one expects a statement that Nehruvian strategy is indispensable in the present circumstances.




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Indian Economy 2008-09

 

Indian Economy 2008-09

Slightly more than two years ago, the worst recession since the Great Depression, set in, notwithstanding all the claims from big-wigs of economic science that the days of ups and downs were long past. It was recalled that similar claim was made on October 15, 1929 when one of the tallest economists of America, Irving Fisher of the Yale University, declared that stock prices had reached "what looks like a permanently high plateau." Just a fortnight after this claim, Wall Street went down, taking the entire world, except the Soviet Union, with it. It took the world economy 25 years to return to the 1929-level. Thanks to Keynes, the myth of rational market was given up.

 

This myth was resurrected from the oblivion towards the last quarter of the 20th century by Thatcher and Reagan regimes under their mentor, Milton Friedman of the University of Chicago. Friedman, to quote Justin Fox (whose recently published book The Myth of the Rational Market is being widely discussed), "never believed markets were perfectly rational, but ... they were more rational than governments."

 

This thinking came to inform the Washington Consensus that became the basis of globalization, sought to be thrust on the world at large by the USA and institutions and economists, aligned to it. Propagandists like Thomas L. Friedman pontificated that the world had no alternative but to fall in line. In our country, the economic mess created by V. P. Singh-Chandrashekhar governments, created conditions for Washington Consensus-based economic reforms to be launched and carried forward during the Narasimha Rao regime. The role of the government was curtailed, public sector undertakings came to be fully or partially privatized, the removal of social inequalities and regional imbalances no longer remained priority for the government, welfare measures were frowned upon, and even health and education sectors were being left at the disposal of market forces and subjected to profit maximization. Nehruvian strategy of development came to be derided and the government's hands were tied by bringing in the wisdom of Arthur Laffer, embodied in the Laffer curve and zero deficit financing. Labour was to be disciplined by giving employers unrestrained power of hiring and firing. SEZ was to be kept totally out of the purview of labour laws and trade union activities.

 

The collapse of this scheme began on June 12, 2007 when Bear Stearns fell to the ground and with this came a chain of companies declaring bankruptcy and downing their shutters. This process continues unabated. The latest is General Motors. Millions of workers have lost their jobs and more are going to lose in the days to come.

 

Only the economies of two countries, India and China, continue to march forward though at a slower pace. As far as India is concerned, its plight is better than most countries of the world because it did not give up the Nehruvian strategy totally, as was underlined by the Congress president Mrs. Sonia Gandhi while speaking at a function organized by the Hindustan Times. It was due to her insistence that NREGA, rural loan waiver scheme and other welfare measures have not only been launched but have also been expanding despite opposition from economists like Kaushik Basu and Raguram G. Rajan. Economic Survey 2008-09, just released highlights this.

 

The rate of economic growth came down in 2008-09 to 6.7 per cent from the average of 8.8 per cent achieved during 2003-04—2007-08, yet, looking at the plight of most countries of the world, it is quite impressive. Despite this deceleration investment continues to be buoyant as is indicated by the fact that "The ratio of fixed investment to GDP consequently increased to 32.2 per cent of GDP in 2008-09 from 31.6 per cent in 2007-08. This reflects the resilience of Indian enterprise, in the face of a massive increase in global uncertainty and risk aversion and freezing of highly developed financial markets."

 

Fortunately, food grains production did not suffer any major decline in 2008-09. It was 229.9 million tonnes as against 230.8 and 217.3 million tonnes in 2007-08 and 2006-07 respectively. Index of industrial production grew only at 2.6 percent as against 8.5 per cent in the previous year. The situation as regards electricity generation too was not a happy one as its rate of generation declined from 6.3 per cent to 2.7 per cent. Inflation continued to cause worries. The 52-week average inflation, based on wholesale price index, rose from 4.7 to 8.4 per cent. If one takes into account consumer prices, the rate of inflation was higher. Both exports and imports declined largely because of recession in trade partners. Government's foreign exchange reserves declined. The budgetary position showed deficits. Gross fiscal deficit came to 6.2 per cent as against 2.7 per cent in the previous year. The revenue deficit rose to 4.6 per cent as compared to 1.1 per cent a year earlier.

 

Economic Survey 2008-09 expresses some kind of fatalism and helplessness when it says: "The global financial meltdown and consequent economic recession in developed economies have clearly been major factor in India's economic slowdown. Given the origin and dimension of the crisis in the advanced countries, which some have called the worst since the Great Depression; every developing country has suffered to a varying degree. No country, including India, remained immune to the global economic shock."

Obviously, this is not in accordance with traditional nationalist thinking as embodied in the documents of the Congress and the governments-led by Nehru and Indira Gandhi. Had these leaders been around, they would have explored the possibility of decoupling from the US economy by reviving NAM and persuading China, Russia, Brazil, Argentina, South Africa and so on. Did not they reject the theories of the "learned" economists from the West, aimed at discouraging India from industrialization and setting up public sector undertakings? Exploring the possibility of "decoupling" needs to be seriously pursued notwithstanding the efforts by the Survey to pour cold water on it. So long as Indian economy remains subjected to FIIs and hot money wandering in search of quick profits, it will continue to experience violent ups and downs.

 

The Survey has underlined the importance of inclusive growth and highlighted some of the ongoing programmes. This is, in fact, accepting the line pursued by Nehru and Indira Gandhi and rejecting the nonsense like 'moral hazard', 'no free lunch', and 'encouraging idleness' through NREGA. In fact, our democracy based on adult franchise is a big restraint that discourages toeing the line of economists like Basu, Rajan and others, deriving their wisdom from neo-liberalism. Yet they have not retreated as is clear from the basket of policy prescriptions, put forth in the Survey. These include: "Reform of Petroleum (LPG, kerosene), fertilizer and food subsidies... Limit LPG subsidy to a maximum of 6-8 cylinders per annum per household. Phase out Kerosene supply-subsidy by ensuring that every rural household (without electricity and LPG connection) has a solar cooker and solar lantern." "Revitalize the disinvestment program and plan to generate at least Rs. 25,000 crore per year. Complete the process of selling 5-10 per cent equity in previously identified profit making non-navratnas. List all unlisted public sector enterprises and sell a minimum of 10 per cent equity to the public. Auction all loss making PSUs that cannot be revived. For those in which net worth is zero, allow negative bidding in the form of debt write-off." "lift the remaining ban on futures contracts to restore price discovery and price risk-management." "Retrenchment of workers: At present prior permission of Government as per Chapter V-B of Industrial Dispute Act is needed for this purpose. This needs to be removed with simultaneous increase in compensation from the present 15 days wages for every year of service." "Factories Act needs to be amended to increase workweek to 60 hours (from 48 hours) and daily limit to meet seasonal demand through overtime."

 

In spite of continuously increasing economic growth rate, India ranks 132nd from the point of human development. As many as 125 nations have more per capita GDP and 126 have greater life expectancy at birth. We have more adult illiteracy rate than 147 countries of the world. The Survey admits that malnutrition continues to be a big problem. "Malnutrition , as measured by underweight children below 3 years , constituting 45.9 per cent ... has still remained much higher. ... Poor feeding practices in infancy and early childhood, resulting in malnutrition contribute to impaired cognitive and social development, poor school performance, and reduced productivity in later life. ... While per capita consumption of cereals has declined, the share of non-cereals in food consumption has not grown to compensate for the decline in cereal availability." It is needless to add that this exposes the claim that mere high rates of economic growth are sufficient to lift people above poverty line. The infatuation with economic growth must be given up and development objective needs to be pursued.

 

A recently published study "India 2039—an affluent society in one generation" emphasizes that India's wealth gap is sure to threaten its growth. To quote Financial Times (June 24): "India needs to curb a concentration of wealth greater than that seen in Brazil and Russia or risk becoming hostage to a corporate oligarchy that will depress the rapid economic growth." The group that has authored the Survey does not seem bothered about because of their obsession with carrying forward the discredited Washington Consensus.





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Wednesday 8 July 2009

Ghost of Marx haunts China's riots

 Ghost of Marx haunts China's riots
By Jian Junbo

SHANGHAI - The weekend violence that has left 156 people dead and more than 816 injured in Urumqi, capital of northwestern Xinjiang Uyghur Autonomous Region, is the latest example of growing conflicts between China's majority Han ethnic group and ethnic minorities.

At the heart of the escalating problem are China's antiquated policies towards its ethnic minorities - a raft of Marxist measures that are now pleasing neither the ethnic Han, nor the minorities. As China's gargantuan economy has advanced, former leader Mao Zedong's vision of political and economic equality between Han and non-Han has gradually been undermined.

The end result could be seen on the bloody streets of Urumqi. On Sunday, more than 300 ethnic Uyghurs - mostly Sunni Muslims - staged a protest in Urumqi's People's Square to demand an investigation into a June 26 brawl at a toy factory in Shaoguan, Guangdong province. Riots began when police began to disperse protesters, soon spreading across the remote city of 2.3 million people.

Groups of rioters broke down guardrails on roads, torched automobiles and beat Han pedestrians. The mob attacked buses and set fire to a hotel near the office building of the Xinjiang Regional Foreign Trade Commission, according to the state-run Xinhua News Agency. Hundreds of cars, shops and homes were smashed and burned during the violence, Xinhua said.

China Central Television on Monday aired images of Uyghur protesters attacking Han men and women, kicking them on the ground and leaving them dazed and bloodied. Images were shown of smoke billowing from vehicles as rioters overturned police cars and smashed buses.

As of Monday evening, at least 156 people were found dead and more than 800 others injured, including armed police officers, the Xinjiang Public Security Department said. More than 50 dead bodies were found in back streets and alleys, officials said, adding grimly that the toll may rise.

Official statistics did not give any breakdowns to show how many Uyghur protesters were killed. A spokesperson for the World Uyghur Congress (WUC), a United States-based organization of pro-independence Uyghurs in exile, told Voice of America that police opened fire on protesters. The Chinese government has blamed the WUC for masterminding the violence,

Xinhua said "the situation was under control" by Monday morning; police had shut down traffic in parts of the city and arrested over 1,000 protesters. Among those detained were at least 10 of the most prominent figures who fanned the unrest on Sunday, the Xinjiang Public Security Department said.

But on Tuesday, over 200 Uyghurs, mostly women, staged a new protest in Urumqi in front of foreign reporters and it was reported that in the afternoon Urumqi Han residents began to counter-attack on Uyghurs. The women demanded the release of their families arrested during Sunday's violence. The foreign reporters had been organized by authorities to visit post-violence scenes, where protesters engaged in a tense stand-off with police, Hong Kong media said.

The Xinjiang government that evening warned that "hostile elements" were plotting to stir up violence in other Xinjiang cities such as Yining and Kashgar.

"We deeply regret the loss of life" in Urumqui, US State Department spokesman Ian Kelly said. "We call on all sides for calm and restraint."

United Nations secretary general Ban Ki-moon also called for restraint. He told a press conference on Monday: "Wherever it is happening or has happened the position of the United Nations and the secretary general has been consistent and clear: that all the differences of opinion, whether domestic or international, must be resolved peacefully through dialogue."

According to Xinhua, a government statement claimed the violence was "a pre-empted, organized violent crime. It is instigated and directed from abroad and carried out by outlaws in the country."

In a televised address on Monday morning, Xinjiang governor Nur Bekri accused the WUC led by Rebiya Kadeer - a former businesswoman now living in the United States - of fomenting the violence via telephone and the Internet. "Rebiya had phone conversations with people in China on July 5 in order to incite ... and the Internet was used to orchestrate the incitement," read the statement.

Kadeer's spokesman, Alim Seytoff, told the Associated Press from Washington that the accusations were baseless.

"It's common practice for the Chinese government to accuse Ms Kadeer for any unrest in East Turkestan and His Holiness the Dalai Lama for any unrest in Tibet," he said. East Turkestan is the name of the state Uyghur pro-independence groups and militants wish to create in Xinjiang.

One the exile groups, the East Turkestan Islamic Movement, is listed by the Chinese government and the UN as a terrorist organization. The WUC denies any connection with the East Turkestan Islamic Movement.

The violence in Urumqi echoed last year's unrest in Tibet. In March 2008, a peaceful demonstration of monks in the capital of Lhasa erupted into riots that spread to surrounding areas, leaving at least 22 dead. The Chinese government accused the Dalai Lama of orchestrating the violence. The Dalai Lama denied the charge.

Whether the riots were instigated by pro-independence activists or not, the fact remains that violent conflicts are easily stirred up by the mutual distrust between the Han people and ethnic minorities. Internet rumors were also involved.

The brawl in the Shaoguan factory on June 26 was started by a post on an Internet website that claimed at least two female Han workers were raped by Uyghur migrant workers, many of whom work at the factory.

In response to the allegation, Han workers stormed into dormitories of the Uyghur workers. In the ensuing battle, two Uyghur were killed and many workers from both sides injured, according to local police. Authorities later arrested a Han worker for uploading the rape rumor to stir up trouble.

The end of class-struggle identity
The increasingly frequent conflicts between Han and other groups indicate the Chinese Communist Party's (CCP's) policy toward ethnic minorities has become ineffective in maintaining harmonious relations between peoples.

For the past 60 years, the stated aim of the CCP's policy has been to maintain national unity and stabilize civil society. The communist government considers all ethnic groups to be Chinese, but encourages all ethnic groups, especially minorities, to keep and develop their traditional cultures. The government has even helped minorities with only a spoken language create their own writing system.

The idea that all people in China belong to the "great family of Chinese" is not the invention of the communists. This attitude began with the founding father of modern China, Dr Sun Yat-sen, and was supported by early Chinese enlightenment thinkers such as Liang Qichao and Hu Shih.

In the era of chairman Mao Zedong, the ethnic policy was dictated by his class-struggle doctrine, by which all Han and non-Han working people shared one common identity - socialist labor. The term "labor" meant they were also the owners of the country - constitutionally and ideologically. Capitalists, land owners, serf owners and other "exploiters" - regardless of their ethnic origins - were the enemies.

This policy successfully surpassed ethnic differences and constructed a shared identity for all working people. To an extent, this policy under Mao united all ethnic groups in the "class struggle" against the "oppressors". It also made the former elites of ethnic minorities diehard enemies of the Chinese Communist Party (CCP).

The working poor of China's ethnic groups gave much support to the CCP government, and accepted their new socialist identity. Han and non-Han people became equal economically and politically, and the idea of ethnicity was gradually faded out by the idea of class.

The concept of a common class, which gave equality to all people in the same class regardless of their ethnicity, surpassed the idea of ethnic identity and forestalled ethnic conflict.

But when the class-struggle doctrine was practiced to the extreme particularly during the Cultural Revolution between 1966 and 1976, it gave the Red Guards - consisting of mostly Hans - the ground to attack China's cultural and historical heritage - Han as well as ethnic - in the name of the revolution. These attacks tremendously hurt the feelings of ethnic minorities.

After the Cultural Revolution, apparently as some form of compensation, the Chinese government began to award some privileges and preferences to ethnic minorities.

For example, the tough one-child policy applies only to Han couples. Accordingly, the birth rate and population proportion of the Han are decreasing, compared to other ethnic groups. Meanwhile, privileges have been granted to ethnic minorities for employment and education opportunities. To boost economic growth, the government in recent years has poured much money into ethnic minority areas.

Many Han are upset at what they see as discrimination. In the aftermath of the Shaoguan brawl, Guangdong party secretary Wang Yang visited and consoled the injured Uyghur workers, but allegedly ignored the injured Han workers. This angered the Han workers and increased their suspicion of the government's policy.

Even as ethnic groups, such as the Uyghurs, complain they are being exploited or discriminated by the Han, many Han accuse the government of doing the same. In the end, as China's economy advances, political and economic equality between Han and non-Han is being undermined.

The wealth gap is expanding between the Han, who in general live in rich areas, and those ethnic minorities who live in relatively poorer areas. The economic inequality between different regions is also a case between Han and non-Hans. Although this imbalance of economic development is due to many factors, it's easy for minorities to feel exploited by the Han.

As the influence of Marxism as the dominant ideology is diminishing in China, the sense of political equality is also abating. Today, common people aren't really considered the owners of the country, and laborers are no longer a respected class. Capitalists have become the government's guests of honor.

In China, political equality based on class equality has collapsed. For the past 60 years, this idea of class equality was a basis on which all common people, including minorities, could maintain an identity as one member of the Chinese political community.

Now, the economic and political marginalization of ethnic minorities is destroying the foundation of some ethnic groups' Chinese identity. At the same time, this marginalization is deeply misunderstood by many of the majority Han ethnic group.

The shared identity of the Chinese - as socialist labor - is gradually falling to pieces. The resulting riots in Urumqi may be just the start of something much, much bigger.

Dr Jian Junbo is assistant professor of the Institute of International Studies at Fudan University, Shanghai, China.



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Sunday 5 July 2009

Democracy's Failing Light

Magazine| Jul 13, 2009

Essay - Is democracy a hit with humans because it mirrors our myopia?

ARUNDHATI ROY

While we're still arguing about whether there's life after death, can we add another question to the cart? Is there life after democracy? What sort of life will it be? By democracy I don't mean democracy as an ideal or an aspiration. I mean the working model: Western liberal democracy, and its variants, such as they are.

So, is there life after democracy?

Attempts to answer this question often turn into a comparison of different systems of governance, and end with a somewhat prickly, combative defence of democracy. It's flawed, we say. It isn't perfect, but it's better than everything else that's on offer. Inevitably, someone in the room will say: 'Afghanistan, Pakistan, Saudi Arabia, Somalia...is that what you would prefer?'

Whether democracy should be the utopia that all 'developing' societies aspire to is a separate question altogether. (I think it should. The early, idealistic phase can be quite heady.) The question about life after democracy is addressed to those of us who already live in democracies, or in countries that pretend to be democracies. It isn't meant to suggest that we lapse into older, discredited models of totalitarian or authoritarian governance. It's meant to suggest that the system of representative democracy—too much representation, too little democracy—needs some structural adjustment.

The question here, really, is: what have we done to democracy? What have we turned it into? What happens once democracy has been used up? When it has been hollowed out and emptied of meaning? What happens when each of its institutions has metastasised into something dangerous? What happens now that democracy and the Free Market have fused into a single predatory organism with a thin, constricted imagination that revolves almost entirely around the idea of maximising profit? Is it possible to reverse this process? Can something that has mutated go back to being what it used to be?

What we need today, for the sake of the survival of this planet, is long-term vision. Can governments whose very survival depends on immediate, extractive, short-term gain provide this? Could it be that democracy, the sacred answer to our short-term hopes and prayers, the protector of our individual freedoms and nurturer of our avaricious dreams, will turn out to be the endgame for the human race? Could it be that democracy is such a hit with modern humans precisely because it mirrors our greatest folly—our nearsightedness? Our inability to live entirely in the present (like most animals do) combined with our inability to see very far into the future makes us strange in-between creatures, neither beast nor prophet. Our amazing intelligence seems to have outstripped our instinct for survival. We plunder the earth hoping that accumulating material surplus will make up for the profound, unfathomable thing that we have lost.

It would be conceit to pretend that the essays in this book provide answers to any of these questions. They only demonstrate, in some detail, the fact that it looks as though the beacon could be failing and that democracy can perhaps no longer be relied upon to deliver the justice and stability we once dreamed it would.All the essays were written as urgent public interventions at critical moments in India—during the state-backed genocide of Muslims in Gujarat; just before the date set for the hanging of Mohammed Afzal, the accused in the December 13, 2001, Parliament attack; during US President George Bush's visit to India; during the mass uprising in Kashmir in the summer of 2008; after the November 26, 2008, Mumbai attacks. Often they were not just responses to events, they were responses to the responses.

Though many of them were written in anger, at moments when keeping quiet became harder than saying something, the essays do have a common thread. They're not about unfortunate anomalies or aberrations in the democratic process. They're about the consequences of and the corollaries to democracy; they're about the fire in the ducts. I should also say that they do not provide a panoramic overview. They're a detailed underview of specific events that I hoped would reveal some of the ways in which democracy is practised in the world's largest democracy. (Or the world's largest 'demon-crazy', as a Kashmiri protester on the streets of Srinagar once put it. His placard said: 'Democracy without Justice=Demon Crazy.')




Indelible mark: Campaigns like this one appealed to the middle class’s sense of ‘cool’

As a writer, a fiction writer, I have often wondered whether the attempt to always be precise, to try and get it all factually right somehow reduces the epic scale of what is really going on. Does it eventually mask a larger truth? I worry that I am allowing myself to be railroaded into offering prosaic, factual precision when maybe what we need is a feral howl, or the transformative power and real precision of poetry. Something about the cunning, Brahminical, intricate, bureaucratic, file-bound, 'apply-through-proper-channels' nature of governance and subjugation in India seems to have made a clerk out of me. My only excuse is to say that it takes odd tools to uncover the maze of subterfuge and hypocrisy that cloaks the callousness and the cold, calculated violence of the world's favourite new Superpower. Repression 'through proper channels' sometimes engenders resistance 'through proper channels'. As resistance goes this isn't enough, I know. But for now, it's all I have. Perhaps someday it will become the underpinning for poetry and for the feral howl.

***

'Listening to Grasshoppers', the essay from which this collection draws its title, was a lecture I gave in Istanbul in January 2008 on the first anniversary of the assassination of the Armenian journalist Hrant Dink. He was shot down on the street outside his office for daring to raise a subject that is forbidden in Turkey—the 1915 genocide of Armenians in which more than one million people were killed.My lecture was about the history of genocide and genocide denial, and the old, almost organic relationship between 'progress' and genocide.

I have always been struck by the fact that the political party in Turkey that carried out the Armenian genocide was called the Committee for Union and Progress. Most of the essays in this collection are, in fact, about the contemporary correlation between Union and Progress, or, in today's idiom, between nationalism and development—those unimpeachable twin towers of modern, free market democracy. Both of these in their extreme form are, as we now know, encrypted with the potential of bringing about ultimate, apocalyptic destruction (nuclear war, climate change).

Though these essays were written between 2002 and 2008, the invisible marker, the starting gun, is the year 1989, when in the rugged mountains of Afghanistan capitalism won its long jehad against Soviet Communism. (Of course, the wheel's in spin again. Could it be that those same mountains are now in the process of burying capitalism? It's too early to tell.) Within months of the collapse of the Soviet Union and the fall of the Berlin Wall, the Indian government, once a leader of the Non-Aligned Movement, performed a high-speed somersault and aligned itself completely with the United States, monarch of the new unipolar world.

Big game: Over ten billion dollars are believed to have been spent in the recent elections

The rules of the game changed suddenly and completely. Millions of people who lived in remote villages and deep in the heart of untouched forests, some of whom had never heard of Berlin or the Soviet Union, could not have imagined how events that occurred in those faraway places would affect their lives. The process of their dispossession and displacement had already begun in the early 1950s, when India opted for the Soviet-style development model in which huge steel plants (Bhilai, Bokaro) and large dams (thousands of them) would occupy the 'commanding heights' of the economy. The era of privatisation and structural adjustment accelerated that process at a mind-numbing speed.

Today, words like 'progress' and 'development' have become interchangeable with economic 'reforms', 'deregulation' and 'privatisation'. 'Freedom' has come to mean 'choice'. It has less to do with the human spirit than with different brands of deodorant. 'Market' no longer means a place where you go to buy provisions. The 'market' is a de-territorialised space where faceless corporations do business, including buying and selling 'futures'. 'Justice' has come to mean 'human rights' (and of those, as they say, 'a few will do'). This theft of language, this technique of usurping words and deploying them like weapons, of using them to mask intent and to mean exactly the opposite of what they have traditionally meant, has been one of the most brilliant strategic victories of the tsars of the new dispensation. It has allowed them to marginalise their detractors, deprive them of a language in which to voice their critique and dismiss them as being 'anti-progress', 'anti-development', 'anti-reform' and of course 'anti-national'—negativists of the worst sort. Talk about saving a river or protecting a forest and they say, 'Don't you believe in Progress?' To people whose land is being submerged by dam reservoirs and whose homes are being bulldozed they say, 'Do you have an alternative development model?' To those who believe that a government is duty-bound to provide people with basic education, healthcare and social security, they say, 'You're against the Market.' And who except a cretin could be against a Market?

To reclaim these stolen words requires explanations that are too tedious for a world with a short attention span, and too expensive in an era when free speech has become unaffordable for the poor.This language heist may prove to be the keystone of our undoing.

Two decades of this kind of 'Progress' in India has created a vast middle class punch-drunk on sudden wealth and the sudden respect that comes with it—and a much, much vaster, desperate underclass. Tens of millions of people have been dispossessed and displaced from their land by floods, droughts and desertification caused by indiscriminate environmental engineering and massive infrastructural projects, dams, mines and special economic zones. All of them developed in the name of the poor, but really meant to service the rising demands of the new aristocracy.

The battle for land lies at the heart of the 'development' debate. Before he became India's finance minister, P. Chidambaram was Enron's lawyer and member of the board of directors of Vedanta, a multinational mining corporation that is currently devastating the Niyamgiri hills in Orissa. Perhaps his career graph informed his worldview. Or maybe it's the other way around. In an interview a year ago, he said that his vision was to get 85 per cent of India's population to live in cities. Realising this 'vision' would require social engineering on an unimaginable scale. It would mean inducing, or forcing, about five hundred million people to migrate from the countryside into cities. That process is well under way and is quickly turning India into a police state in which people who refuse to surrender their land are being made to do so at gunpoint. Perhaps this is what makes it so easy for P. Chidambaram to move so seamlessly from being finance minister to being home minister. The portfolios are separated only by an osmotic membrane. Underlying this nightmare masquerading as 'vision' is the plan to free up vast tracts of land and all of India's natural resources, leaving them ripe for corporate plunder. In effect, to reverse the post-independence policy of land reforms.

Already forests, mountains and water systems are being ravaged by marauding multinational corporations, backed by a State that has lost its moorings and is committing what can only be called 'ecocide'. In eastern India, bauxite and iron ore mining is destroying whole ecosystems, turning fertile land into desert. In the Himalayas, hundreds of high dams are being planned, the consequences of which can only be catastrophic. In the plains, embankments built along rivers, ostensibly to control floods, have led to rising river beds, causing even more flooding, more waterlogging, more salinisation of agricultural land and the destruction of livelihoods of millions of people. Most of India's holy rivers, including the Ganga, have been turned into unholy drains that carry more sewage and industrial effluent than water. Hardly a single river runs its course and meets the ocean.


Unsustainable: Big dam projects, like this one in Tehri, find widespread support

Based on the absurd notion that a river flowing into the sea is a waste of water, the Supreme Court, in an act of unbelievable hubris, has arbitrarily ordered that India's rivers be interlinked, like a mechanical water supply system. Implementing this would mean tunnelling through mountains and forests, altering natural contours and drainage systems of river basins and destroying deltas and estuaries. In other words, wrecking the ecology of the entire subcontinent. (B.N. Kirpal, the judge who passed this order, joined the environmental board of Coca-Cola after he retired. Nice touch!)

The regime of free market economic policies, administered by people who are blissfully ignorant of the fate of civilisations that grew too dependent on artificial irrigation, has led to a worrying shift in cropping patterns.Sustainable food crops, suitable to local soil conditions and micro-climates, have been replaced by water-guzzling, hybrid and genetically modified 'cash' crops which, apart from being wholly dependent on the market, are also heavily dependent on chemical fertilisers, pesticides, canal irrigation and the indiscriminate mining of ground water. As abused farmland, saturated with chemicals, gradually becomes exhausted and infertile, agricultural input costs rise, ensnaring small farmers in a debt trap. Over the last few years, more than 1,80,000 Indian farmers have committed suicide. While state granaries are bursting with food that eventually rots, starvation and malnutrition approaching the same levels as in sub-Saharan Africa stalk the land. Truly the nine per cent growth rate is beginning to look like a downward spiral. The higher the rate of this kind of growth, the worse the prognosis. Any oncologist will tell you that.


Looming spectre: The widow of a Vidarbha farmer who committed suicide

It's as though an ancient society, decaying under the weight of feudalism and caste, was churned in a great machine. The churning has ripped through the mesh of old inequalities, recalibrating some of them but reinforcing most. Now the old society has curdled and separated into a thin layer of thick cream—and a lot of water. The cream is India's 'market' of many million consumers (of cars, cell phones, computers, Valentine's Day greeting cards), the envy of international business. The water is of little consequence. It can be sloshed around, stored in holding ponds, and eventually drained away.

Or so they think, the men in suits. They didn't bargain for the violent civil war that has broken out in India's heartland: Chhattisgarh, Jharkhand, Orissa, West Bengal.
***

Coming back to 1989. As if to illustrate the connection between 'Union' and 'Progress', at exactly the same time that the Congress government was opening up India's markets to international finance, the right-wing Bharatiya Janata Party (BJP), then in the opposition, began its virulent campaign of Hindu nationalism (popularly known as 'Hindutva'). In 1990, its leader, L.K. Advani, travelled across the country, whipping up hatred against Muslims and demanding that the Babri Masjid, an old 16th-century mosque that stood on a disputed site in Ayodhya, be demolished and a Ram temple built in its place. In 1992, a mob, egged on by Advani, demolished the mosque. Feeding off the communal frenzy it had generated, the BJP, which had only two seats in Parliament in 1984, defeated the Congress in 1998 and came to power at the Centre.

It's not a coincidence that the rise of Hindutva corresponded with the historical moment when America substituted Communism with Islam as its great enemy. The radical Islamist mujahideen—whom President Reagan once entertained in the White House and compared to America's founding fathers—suddenly began to be called terrorists. CNN's live broadcast of the 1990-91 Gulf War—Operation Desert Storm—made it to elite drawing rooms in Indian cities, bringing with it the early thrills of satellite TV. Almost simultaneously, the Indian government, once a staunch friend of the Palestinians, turned into Israel's 'natural ally'. Now India and Israel do joint military exercises, share intelligence and probably exchange notes on how best to administer occupied territories.

By 1998, when the BJP took office, the 'Progress' project of privatisation and liberalisation was about eight years old. Though it had campaigned vigorously against the economic reforms, saying they were a process of 'looting through liberalisation', once it came to power the BJP embraced the free market enthusiastically and threw its weight behind huge corporations like Enron.(In representative democracies, once they're elected, the people's representatives are free to break their promises and change their minds.)

Within weeks of taking office, the BJP conducted a series of thermonuclear tests. Though India had thrown its hat into the nuclear ring in 1974, politically, the 1998 nuclear tests were of a different order altogether. The orgy of triumphant nationalism with which the tests were greeted introduced a chilling new language of aggression and hatred into mainstream public discourse. None of what was being said was new, only that what was once considered unacceptable was suddenly being celebrated. Since then, Hindu communalism and nuclear nationalism, like corporate globalisation, have vaulted over the stated ideologies of political parties. The venom has been injected straight into our bloodstream. It's there now—in all its violence and banality—for us to deal with in our daily lives, regardless of whether the government at the centre calls itself 'secular' or not. The Muslim community has seen a sharp decline in its fortunes and is now at the bottom of the social pyramid, along with Dalits and Adivasis. Certain events that occur in the life of a nation have the effect of parting the curtains and giving ordinary people a glimpse into the future. The 1998 nuclear tests were one such. You didn't need the gift of prophecy to tell in which direction India was heading.
***

In February 2002, following the burning of a train coach in which 58 Hindu pilgrims returning from Ayodhya were burned alive, the BJP government in Gujarat, led by chief minister Narendra Modi, presided over a carefully planned genocide of Muslims in the state. The Islamophobia generated all over the world by the September 11, 2001, attacks put the wind in their sails. The machinery of the state of Gujarat stood by and watched while more than 2,000 people were massacred. Gujarat has always been a communally tense state. There had been riots before. But this was not a riot. It was a genocidal massacre, and though the number of victims was insignificant compared to the horror of say Rwanda, Sudan or the Congo, the Gujarat carnage was designed as a public spectacle whose aims were unmistakable. It was a public warning to Muslim citizens from the government of the world's favourite democracy.

After the carnage, Modi pressed for early elections. He was returned to power with a mandate from the people of Gujarat. Five years later he repeated his success: he is now serving a third term as chief minister, widely appreciated by business houses for his faith in the free market, illustrating the organic relationship between 'Union' and 'Progress'. Or, if you like, between Fascism and the Free Market.

In January 2009 that relationship was sealed with a kiss at a public function. The CEOs of two of India's biggest corporations, Ratan Tata (of the Tata Group) and Mukesh Ambani (of Reliance Industries), while accepting the Gujarat Garima (Pride of Gujarat) award, celebrated the development policies of Modi, architect of the Gujarat genocide, and warmly endorsed him as a future candidate for prime minister.
***

As this book goes to press, the nearly two-billion-dollar 2009 general election has just been concluded. That's a lot more than the budget of the US elections. According to some media reports, the actual amount spent is closer to ten billion dollars. Where, might one ask, does that kind of money come from?

The Congress and its allies, the United Progressive Alliance (UPA), have won a comfortable majority. Interestingly, more than 90 per cent of the independent candidates who stood for elections lost. Clearly, without sponsorship it's hard to win an election.And independent candidates cannot promise subsidised rice, free TVs and cash-for-votes, those demeaning acts of vulgar charity that elections have been reduced to.



Victory?: A Congress worker celebrates the recent UPA victory as a CPI(M) worker looks on

When you take a closer look at the calculus that underlies election results, words like 'comfortable' and 'majority' turn out to be deceptive, if not outright inaccurate. For instance, the actual share of votes polled by the UPA in these elections works out to only 10.3 per cent of the country's population! It's interesting how the cleverly layered mathematics of electoral democracy can turn a tiny minority into a thumping mandate. Anyway, be that as it may, the point is that it will not be L.K. Advani, hate-monger incarnate, but secular Dr Manmohan Singh, gentle architect of the market reforms, a man who has never won an election in his life, who will be prime minister of the world's largest democracy for a second term.


Tribal war: Chhattisgarh has pitted tribespeople against their own through the Salwa Judum

In the run-up to the polls, there was absolute consensus across party lines about the economic 'reforms'. Govindacharya, formerly the chief ideologue of the BJP, progenitor of the Ram Janmabhoomi movement, sarcastically suggested that the Congress and BJP form a coalition. In some states they already have. In Chhattisgarh, for example, the BJP runs the government and Congress politicians run the Salwa Judum, a vicious government-backed 'people's militia'. The Judum and the government have formed a joint front against the Maoists in the forests who are engaged in a deadly and often brutal armed struggle against displacement and against land acquisition by corporations waiting to set up steel factories and to begin mining iron ore, tin and all the other wealth stashed below the forest floor. So, in Chhattisgarh, we have the remarkable spectacle of the two biggest political parties of India in an alliance against the Adivasis of Dantewada, India's poorest, most vulnerable people. Already 644 villages have been emptied. Fifty thousand people have moved into Salwa Judum camps. Three hundred thousand are hiding in the forests and are being called Maoist terrorists or sympathisers. The battle is raging, and the corporations are waiting.

It is significant that India is one of the countries that blocked a European move in the UN asking for an international probe into war crimes that may have been committed by the government of Sri Lanka in its recent offensive against the Tamil Tigers. Governments in this part of the world have taken note of Israel's Gaza blueprint as a good way of dealing with 'terrorism': keep the media out and close in for the kill. That way they don't have to worry too much about who's a 'terrorist' and who isn't. There may be a little flurry of international outrage, but it goes away pretty quickly.

Things do not augur well for the forest-dwelling people of Chhattisgarh.

Reassured by the sort of 'constructive' collaboration, the consensus between political parties, few were more enthusiastic about the recent general elections than some major corporate houses. They seem to have realised that a democratic mandate can legitimise their pillaging in a way that nothing else can. Several corporations ran extravagant advertising campaigns on TV, some featuring Bollywood film stars urging people, young and old, rich and poor, to go out and vote. Shops and restaurants in Khan Market, Delhi's most tony market, offered discounts to those whose index (voting) fingers were marked with indelible ink.Democracy suddenly became the cool new way to be. You know how it is: the Chinese do Sport, so they had the Olympics; India does Democracy, so we had an election. Both are heavily sponsored, TV-friendly spectator sports.

The BBC commissioned a coach on a train—the India Election Special—that took journalists from all over the world on a sightseeing tour to witness the miracle of Indian elections. The train coach had a slogan painted on it: 'Will India's voters revive the World's Fortunes?' BBC (Hindi) had a poster up in a cafe near my home. It featured a hundred dollar bill (with Ben Franklin) morphing into a 500 rupee note (with Gandhi). It said: 'Kya India ka vote bachayega duniya ka note?' (Will India's votes rescue the world's currency notes?) In these flagrant and unabashed ways, an electorate has been turned into a market, voters are seen as consumers, and democracy is being welded to the Free Market. Ergo: those who cannot consume do not matter.

What does the victory of the UPA mean in this election? Obviously a myriad things. The debate is wide open. Interpreting an Indian election is about as exact a science as sorcery. Voting patterns are intricately connected with local issues and caste and community equations that vary, quite literally, from polling booth to polling booth. There can be no reliable Big Conclusion. But here's something to think about.




Sparing none: ‘Development’ and ‘Progress’ have left our rivers stinking and polluted

In its time in office, in order to mitigate the devastation caused by its economic policies, the former Congress regime passed three progressive (critics call them populist and controversial) parliamentary acts. The Forest Rights Act (which gave forest-dwellers legal right to land and the traditional use of forest produce), the Right to Information Act and, most important of all, the National Rural Employment Guarantee Act (NREGA). The NREGA guarantees every rural family a hundred days of work (hard, manual labour) a year at minimum wages. It amounts to an average of Rs 8,000 (about $170) per family per year. Enough for a good meal in a restaurant, including wine and dessert. Imagine how hellish times must be for even that tiny amount of money to come as a relief to millions of people who are reeling under the impact of the precipitous loss of their lands and their livelihoods. (Talk about crumbs from the high table. But then, which one of us has the heart, or the right, to argue that no crumbs are better than crumbs? Or, indeed, that no elections are better than meaningless elections?) Implementing the NREGA, seeing that the crumbs actually reach the people they're meant for, has occupied all the time and energy of some of India's finest and most committed social activists for the last several years. They have had to battle cartels of corrupt government officers, power-brokers and middlemen. They have faced threats and a fair amount of violence. One rural activist in Jharkhand immolated himself in anger and frustration at the injustice of it all.

Ironically, the NREGA only made it through Parliament because of pressure brought to bear on the UPA government by the Left Front and, it must be said, by Sonia Gandhi. It was passed despite tremendous resistance from the mandarins of the free market within the Congress party. The corporate media was more or less unanimously hostile to the Act. Needless to say, come election-time and the NREGA became one of the main planks of the Congress party's election campaign. There's little doubt that the goodwill it generated amongst the very poor translated into votes for the Congress.But now that the elections are over, victory is being attributed to the very policies that the NREGA was passed to mitigate! The Captains of Industry have lost no time in claiming the 'People's Mandate' as their own. 'It's fast forward for markets', the business papers crowed the morning after, 'Vote [was] for reforms, says India Inc'.

There is an even greater irony: the Left Front, acting with the duplicity that has become second nature to all parliamentary political parties, took a sharp turn to the right. Even while it criticised the government's economic policies at the Centre, it tried to enforce similar ones on its home turf in West Bengal. It announced that it was going to build a chemical hub in Nandigram, a manufacturing unit for the Tata Nano in Singur, and a Jindal Steel plant some kilometres outside the forests of Lalgarh, home to the Santhal people. It began to acquire land, most of it fertile farmland, virtually at gunpoint. The massive, militant uprisings that followed were put down with bullets and lathicharges. Lumpen 'party' militias ran amok among the protesters, raping women and killing people. But eventually the combination of genuine mass mobilisation and militancy worked. The people prevailed. They won all three battles, and forced the government to back off. The Tatas had to move the Nano project to Gujarat, that laboratory of fascism, which offered a 'good investment climate'. The Left Front was decimated in the elections in West Bengal, something that had not happened in thirty years.

The irony doesn't end there. In a fiendishly clever sleight of hand, the defeat of the Left is being attributed to its obstructionism and anti-development policies! 'Corporate captains feel easy without Left', the papers said. The stockmarket surged, looking forward to 'a summer of joy'. CEOs on TV channels celebrated the new government's 'liberation' from the Left. Hectoring news anchors have announced that the UPA no longer has any excuse to prevaricate on implementing reforms, unless of course it has 'closet socialists' hiding in its midst.

This is the wonderful thing about democracy. It can mean anything you want it to mean.

The absence of a genuinely left-wing party in mainstream politics is not something to celebrate. But the parliamentary Left has only itself to blame for its humiliation. It's not a tragedy that it has been cut to size. Perhaps this will create the space for some truly progressive politics.




Caught in a cleft: Despite democracy, Kashmir finds it impossible to speak what it thinks

For the sake of argument, let's for a moment contemplate the absurd and accept that India Inc and the Captains of Industry are right and that India's millions did in fact vote for the speeding up of market 'reforms'. Is that good news or bad news? Should we be celebrating the fact that millions of people who have something to teach the world, who have another imagination, another worldview and a more sustainable way of life, have decided to embrace a discredited ideology, one that has pushed this planet into a crisis from which it may never recover?

What good will forest rights be when there are no forests? What good will the Right to Information do if there is no redress for our grievances? What good are rivers without water? What good are plains without mountains to water and sustain them? It's as though we're hurtling down a cliff in a bus without brakes and fighting over what songs to sing.

'Jai Ho!' perhaps?

***

For better or for worse, the 2009 elections seem to have ensured that the 'Progress' project is up and running. However, it would be a serious mistake to believe that the 'Union' project has fallen by the wayside.

As the 2009 election campaign unrolled, two things got saturation coverage in the media.One was the 1,00,000 rupee (two thousand dollar) 'people's car', the Tata Nano—the wagon for the volks—rolling out of Modi's Gujarat. (The sops and subsidies Modi gave the Tatas had a lot to do with Ratan Tata's warm endorsement of him.) The other is the hate speech of the BJP's monstrous new debutant, Varun Gandhi (another descendant of the Nehru dynasty), who makes even Narendra Modi sound moderate and retiring. In a public speech, Varun Gandhi called for Muslims to be forcibly sterilised. 'This will be known as a Hindu bastion, no ***** Muslim dare raise his head here', he said, using a derogatory word for someone who has been circumcised. 'I don't want a single Muslim vote.'
Varun is a modern politician, working the democratic system, doing everything he can to create a majority and consolidate his votebank. A politician needs a votebank, like a corporation needs a mass market. Both need help from the mass media. Corporations buy that help. Politicians must earn it. Some earn it by dint of hard work, others with dangerous circus stunts. Varun's hate speech bought him national headlines. His brief stint in prison (for violating the Election Commission's code of conduct), cut short by a court order, made him an instant martyr. He was gently chastised for his impetuousness by his party elders (on TV, for public consumption). But then, in order to export his coarse appeal, he, like Narendra Modi, was flown around in a chopper as a star campaigner for the BJP in other constituencies.

Varun Gandhi won his election with a colossal margin. It makes you wonder—are 'the people' always right? It is worrying to think what lessons the BJP will draw from its few decisive victories and its many decisive losses in this election. In several of the constituencies where it has won, hate speech (and deed) served it well. It still remains by far the second largest political party, with a powerful national presence, the only real challenge to the Congress. It will certainly live to fight another day. The question is, will it turn the burners up or down?




Sting of acid: Despite (or due to) his hatespeak, Varun Gandhi won the elections from Pilibhit

This said, it would be a travesty to lay all the blame for divisive politics at the door of the BJP. Whether it's nuclear tests, the unsealing of the locks of the Babri Masjid, the culture of creating fissures and pitting castes and communities against each other, or passing retrograde laws, the Congress got there first and has never been shy of keeping the ball in play. In the past, both parties have used massacres to gain political mileage. Sometimes they feast off them obliquely, sometimes they accuse each other of committing mass murder. In this election, both the Congress and the BJP brazenly fielded candidates believed to be involved in public lynching and mass murder. At no point has either seen to it that the guilty are punished or that justice is delivered. Despite their vicious public exchange of accusations, so far they have colluded to protect one another from real consequences.

Eventually the massacres get absorbed into the labyrinth of India's judicial system where they are left to bubble and ferment before being trundled out as campaign material for the next election. You could say it's all a part of the fabric of Indian democracy. Hard to see from a train window. Whether the new infusion of young blood into the Congress will change the old party's methods of doing business remains to be seen.

As will be obvious from the essays in this book, the hoary institutions of Indian democracy—the judiciary, the police, the 'free' press and, of course, elections—far from working as a system of checks and balances, quite often do the opposite.They provide each other cover to promote the larger interests of Union and Progress. In the process, they generate such confusion, such a cacophony, that voices raised in warning just become part of the noise. And that only helps to enhance the image of the tolerant, lumbering, colourful, somewhat chaotic democracy. The chaos is real. But so is the consensus.
***

Speaking of consensus, there's the small and ever-present matter of Kashmir. When it comes to Kashmir the consensus in India is hardcore. It cuts across every section of the establishment—including the media, the bureaucracy, the intelligentsia and even Bollywood.

The war in the Kashmir Valley is almost 20 years old now, and has claimed about 70,000 lives. Tens of thousands have been tortured, several thousand have 'disappeared', women have been raped and many thousands widowed. Half a million Indian troops patrol the Kashmir Valley, making it the most militarised zone in the world. (The United States had about 1,65,000 active-duty troops in Iraq at the height of its occupation.) The Indian army now claims that it has, for the most part, crushed militancy in Kashmir. Perhaps that's true. But does military domination mean victory?

How does a government that claims to be a democracy justify a military occupation? By holding regular elections, of course. Elections in Kashmir have had a long and fascinating past. The blatantly rigged state election of 1987 was the immediate provocation for the armed uprising that began in 1990. Since then elections have become a finely honed instrument of the military occupation, a sinister playground for India's Deep State. Intelligence agencies have created political parties and decoy politicians, they have constructed and destroyed political careers at will. It is they more than anyone else who decide what the outcome of each election will be. After every election, the Indian establishment declares that India has won a popular mandate from the people of Kashmir.

In the summer of 2008, a dispute over land being allotted to the Amarnath Shrine Board coalesced into a massive, non-violent uprising. Day after day, hundreds of thousands of people defied soldiers and policemen—who fired straight into the crowds, killing scores of people—and thronged the streets. From early morning to late in the night, the city reverberated to chants of 'azadi! azadi!' ('freedom! freedom!'). Fruit-sellers weighed fruit chanting, 'azadi! azadi!' Shopkeepers, doctors, houseboat owners, guides, weavers, carpet-sellers—everybody was out with placards, everybody shouted 'azadi! azadi!' The protests went on for several days.

The protests were massive. They were democratic, and they were non-violent. For the first time in decades, fissures appeared in mainstream public opinion in India. The Indian state panicked. Unsure of how to deal with this mass civil disobedience, it ordered a crackdown. It enforced the harshest curfew in recent memory with shoot-at-sight orders. In effect, for days on end, it virtually caged millions of people. The major pro-freedom leaders were placed under house arrest, several others were jailed. House-to-house searches culminated in the arrest of hundreds of people. The Jama Masjid was closed for Friday prayers for an unprecedented seven weeks at a stretch.

Once the rebellion was brought under control, the government did something extraordinary—it announced elections in the state. Pro-independence leaders called for a boycott. They were re-arrested. Almost everybody believed the elections would become a huge embarrassment for the Indian government. The security establishment was convulsed with paranoia. Its elaborate network of spies, renegades and embedded journalists began to buzz with renewed energy.No chances were taken. (Even I, who had nothing to do with any of what was going on, was put under house arrest in Srinagar for two days.)

Calling for elections was a huge risk. But the gamble paid off. People turned out to vote in droves. It was the biggest voter turnout since the armed struggle began. It helped that the polls were scheduled so that the first districts to vote were the most militarised even within the Kashmir Valley.

None of India's analysts, journalists and psephologists cared to ask why people who had only weeks ago risked everything, including bullets and shoot-at-sight orders, should have suddenly changed their minds. None of the high-profile scholars of the great festival of democracy—who practically live in TV studios when there are elections in mainland India, picking apart every forecast, exit poll and minor percentile swing in the voteshare—talked about what elections mean in the presence of such a massive, year-round troop deployment. (An armed soldier for every 20 civilians.) No one speculated about the mystery of hundreds of unknown candidates who materialised out of nowhere to represent political parties that had no previous presence in the Kashmir Valley. Where had they come from? Who was financing them? No one was curious.

No one spoke about the curfew, the mass arrests, the lockdown of constituencies that were going to the polls. Not many talked about the fact that campaigning politicians went out of their way to delink 'azadi' and the Kashmir dispute from elections, which they insisted were only about municipal issues—roads, water, electricity. No one talked about why people who have lived under a military occupation for decades—where soldiers could barge into homes and whisk away people at any time of the day or night—might need someone to listen to them, to take up their cases, to represent them.

The minute elections were over, the establishment and the mainstream press declared victory (for India) once again. The most worrying fallout was that in Kashmir, people began to parrot their colonisers' view of themselves as a somewhat pathetic people who deserved what they got. 'Never trust a Kashmiri,' several Kashmiris said to me. 'We're fickle and unreliable.' Psychological warfare has been an instrument of official policy in Kashmir. Its depredations over decades—its attempt to destroy people's self-esteem—are arguably the worst aspect of the occupation.

But only weeks after the elections it was back to business as usual. The protests and demands for azadi and the summary killings by security forces have begun again. Newspapers report that militancy is on the rise. Unsurprisingly, the poor turnout in the subsequent general elections did not elicit much comment.

It's enough to make you wonder whether there is any connection at all between elections and democracy.

The trouble is that Kashmir sits on the faultlines of a region that is awash in weapons and sliding into chaos. The Kashmiri freedom struggle, with its crystal-clear sentiment but fuzzy outlines, is caught in the vortex of several dangerous and conflicting ideologies—Indian nationalism (corporate as well as 'Hindu', shading into imperialism), Pakistani nationalism (breaking down under the burden of its own contradictions), US imperialism (made impatient by a tanking economy), and a resurgent medieval-Islamist Taliban (fast gaining legitimacy, despite its insane brutality, because it is seen to be resisting an occupation). Each of these ideologies is capable of a ruthlessness that can range from genocide to nuclear war.Add Chinese imperial ambitions, an aggressive, reincarnated Russia, the huge reserves of natural gas in the Caspian region and persistent whispers about natural gas, oil and uranium reserves in Kashmir and Ladakh, and you have the recipe for a new Cold War (which, like the last one, is cold for some and hot for others).

In the midst of all this, Kashmir is set to become the conduit through which the mayhem unfolding in Afghanistan and Pakistan spills into India, where it will find purchase in the anger of the young among India's 150 million Muslims who have been brutalised, humiliated and marginalised. Notice has been given by the series of terrorist strikes that culminated in the Mumbai attacks of 2008.

There is no doubt that the Kashmir dispute ranks right up there, along with Palestine, as one of the oldest, most intractable disputes in the world. That does not mean that it cannot be resolved. Only that the solution will not be completely to the satisfaction of any one party, one country or one ideology. Negotiators will have to be prepared to deviate from the 'party line'. Of course, we haven't yet reached the stage where the Government of India is even prepared to admit that there's a problem, let alone negotiate a solution. Right now it has no reason to. Internationally, its stocks are soaring. Its economy is still ticking over, and while its neighbours deal with bloodshed, civil war, concentration camps, refugees and army mutinies, India has just concluded a beautiful election.

However, Demon-crazy can't fool all the people all the time. India's temporary, shotgun solutions to the unrest in Kashmir (pardon the pun) have magnified the problem and driven it deep into a place where it is poisoning the aquifers.
***

Perhaps the story of the Siachen glacier, the highest battlefield in the world, is the most appropriate metaphor for the insanity of our times. Thousands of Indian and Pakistani soldiers have been deployed there, enduring chill winds and temperatures that dip to minus 40 Celsius. Of the hundreds who have died there, many have died just from the cold—from frostbite and sunburn. The glacier has become a garbage dump now, littered with the detritus of war, thousands of empty artillery shells, empty fuel drums, ice-axes, old boots, tents and every other kind of waste that thousands of warring human beings generate. The garbage remains intact, perfectly preserved at those icy temperatures, a pristine monument to human folly. While the Indian and Pakistani governments spend billions of dollars on weapons and the logistics of high-altitude warfare, the battlefield has begun to melt. Right now, it has shrunk to about half its size. The melting has less to do with the military standoff than with people far away, on the other side of the world, living the good life. They're good people who believe in peace, free speech and human rights. They live in thriving democracies whose governments sit on the UN Security Council and whose economies depend heavily on the export of war and the sale of weapons to countries like India and Pakistan. (And Rwanda, Sudan, Somalia, the Republic of Congo, Iraq, Afghanistan. .. it's a long list.) The glacial melt will cause severe floods in the subcontinent, and eventually severe drought that will affect the lives of millions of people. That will give us even more reasons to fight. We'll need more weapons. Who knows, that sort of consumer confidence may be just what the world needs to get over the current recession. Then everyone in the thriving democracies will have an even better life—and the glaciers will melt even faster.
***

While I read 'Listening to Grasshoppers' to a tense audience packed into a university auditorium in Istanbul (tense because words like unity, progress, genocide and Armenian tend to anger the Turkish authorities when they are uttered close together), I could see Rakel Dink, Hrant Dink's widow, sitting in the front row, crying the whole way through. When I finished, she hugged me and said, "We keep hoping. Why do we keep hoping?"

We, she said. Not you.

The words of Faiz Ahmed Faiz, sung so hauntingly by Abida Parveen, came to me:
Nahin nigah main manzil to justaju hi sahi,
Nahin wisaal mayassar to arzu hi sahi
I tried to translate them for her (sort of):
If dreams are thwarted, then yearning must take their place,
If reunion is impossible, then longing must take its place.
You see what I meant about poetry?


--------------------------------------------------------------------------------


[Adapted from Roy's Introduction to her new book of collected essays, Listening to Grasshoppers: Field Notes on Democracy, published this month by Hamish Hamilton (Penguin)]

Friday 3 July 2009

Privatisation has been a train wreck

 

 

With National Express abandoning a franchise, the system is bankrupt. Railway nationalisation is the only rational solution.


guardian.co.uk, Thursday 2 July 2009 18.30 BST

The temporary nationalisation of the east coast mainline service should be another nail in the coffin of the privatisation of the railways. It shows once again what a bad deal for taxpayers the privatisation of the railways has turned out to be.

The government says it plans to return the franchise as quickly as possible to a private contractor, but it should instead take the opportunity to retain the line in public hands. Following, as it does, the fiasco of Railtrack, which brought the national rail network to the brink of collapse in 2002, and the collapse of Metronet, in charge of two thirds of the misguided public private partnership (PPP) on the tube, this is the right time to plan returning the entire national rail network to public ownership. If the government tossed aside the ideological blinkers of the Treasury and got that message, they would do themselves a great deal of good among passengers and taxpayers alike.

It is a complete con for the National Express group to walk away from the contract, leaving a gap in the national rail budget, forcing the state to bear the cost while the service is re-franchised – possibly at a lower value than the National Express contract – but insisting on its right to continue to operate other franchises unscathed. National Express says it has received "clear and detailed" legal advice that it does not have to hand back its London to Essex franchise and East Anglia routes. So it wants to run away from a problem on one line and let the rest of us pick up the pieces, while continuing to make profits from other lines.

The attempt of National Express to avoid any consequences for their other franchises from their abandonment of the east coast service is just another example of the privateers trying to take the public sector for a ride. As Lord Adonis says, "It is simply unacceptable to reap the benefits of contracts when times are good, only to walk away from them when times become more challenging."

Time and again, we have seen the nationalisation of losses and the privatisation of profits. It's also the latest demonstration that it is a fairy tale that privatisation means the private sector takes the risk as well as taking its profit. In truth, every time a privatisation of a vital public service fails, the public sector picks up the tab. This culture of parts of the private sector fleecing the taxpayer has to stop.

Part of the problem is that civil servants are taken to the cleaners in the construction of the privatisation contracts by the private companies' sharper legal teams. One of the rationales for the tube's PPP was that it made no sense to hand billions of pounds of public money for tube upgrades over to London Underground management and civil servants who had such a poor record of delivering. Yet, these same civil servants were left to draw up the detail of the PPP contracts. They were completely turned over by the private sector.

But the real issue is that it is inherently wasteful to run these services on privatised lines. The nature of the privatising companies is that a significant proportion of the profits of their activities have to be paid in dividends to shareholders rather than reinvested in the service. This is money wasted. A publicly-owned company would be obliged to reinvest any revenues back into the transport system.

Furthermore, privatisation is justified on the grounds that the private sector is driven, through the rigour of competition, to be more efficient and more responsive to passengers' needs. This is a fiction in the case of a natural monopoly like a railway. Apart from the brief period of competition among bidders for contracts, there is no day-to-day competition at all – no one is going to build a rival railway line and poach passengers from the private franchisee. They are under no pressure from any competition at all. In such circumstances, it is more rational, and makes more sense in terms of sustaining investment, for rail services to be publicly-owned.
Nor is it the case that public ownership of the rail network naturally has to involve poorer management than the private sector.

There are many publicly-owned rail companies all over the world that provide services that British transport users can only envy. The task is to build up good quality management, including the best management from around the world, overseeing real investment that meets the needs of rail travellers.

It shouldn't just be the east coast service that's nationalised and it shouldn't just be temporary. Ultimately, the rail network would

be more rationally run in the public sector.


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A coup Latin America didn't need


 

Johann Hari:

 

It was inevitable that the people at the top would fight to preserve their privileges

 
The ghost of the other, deadlier 9/11 has returned to stalk Latin America. On Sunday morning, a battalion of soldiers rammed their way into the Presidential Palace in Honduras. They surrounded the bed where the democratically elected President, Manuel Zelaya, was sleeping, and jabbed their machine guns to his chest. They ordered him to get up and marched him on to a military plane. They dumped him in his pyjamas on a landing strip in Costa Rica and told him never to return to the country that freely chose him as their head of state.
 
Back home, the generals locked down the phone networks, the internet and international TV channels, and announced their people were in charge now. Only sweet, empty music plays on the radio. Government ministers have been arrested and beaten. If you leave your home after 9pm, the population have been told, you risk being shot. Tanks and tear gas are ranged against the protesters who have thronged on to the streets.
 
For the people of Latin America, this is a replay of their September 11. On that day in Chile in 1973, Salvador Allende – a peaceful democratic socialist who was steadily redistributing wealth to the poor majority – was bombed from office and forced to commit suicide. He was replaced by a self-described "fascist", General Augusto Pinochet, who went on to "disappear" tens of thousands of innocent people. The coup was plotted in Washington DC, by Henry Kissinger.
 
The official excuse for killing Chilean democracy was that Allende was a "communist". He was not. In fact, he was killed because he was threatening the interests of US and Chilean mega-corporations by shifting the country's wealth and land from them to its own people. When Salvador Allende's widow died last week, she seemed like a symbol from another age – and then, a few days later, the coup came back.
 
Honduras is a small country in Central America with only seven million inhabitants, but it has embarked on a programme of growing democracy of its own. In 2005, Zelaya ran promising to help the country's poor majority – and he kept his word. He increased the minimum wage by 60 per cent, saying sweatshops were no longer acceptable and "the rich must pay their share".
 
The tiny elite at the top – who own 45 per cent of the country's wealth – are horrified. They are used to having Honduras run by them, for them.
 
But this wave of redistributing wealth to the population is washing over Latin America. In the barrios and favelas, I have seen how shanty towns made out of mud and rusted tin now have doctors and teachers and subsidised supermarkets for the first time, because they elected leaders who have turned the spigot of oil money in their direction. In Venezuela, for example, the poorest half of the country has seen its incomes soar by 130 per cent after inflation since they chose Hugo Chavez as their President, according to studies cited by the Nobel Prize-winning US economist Joseph Stiglitz. Infant mortality has plummeted.
 
No wonder so many Latin American countries are inspired by this example: the notion that Chavez has to "bribe" or "brainwash" people like Zelaya is bizarre.
 
It was always inevitable that the people at the top would fight back to preserve their unearned privilege. In 2002, the Venezuelan oligarchy conspired with the Bush administration in the kidnapping of Hugo Chavez. It was only a massive democratic uprising of the people that forced his return. Now they have tried the same in Honduras.
 
Yet the military-business nexus have invented a propaganda-excuse that is being eagerly repeated by dupes across the Western world. The generals claim they have toppled the democratically elected leader and arrested his ministers to save democracy.
Here's how it happened. Honduras has a constitution that was drawn up in 1982, by the oligarchy, under supervision from the outgoing military dictatorship. It states that the President can only serve only one term, while the military remains permanent and "independent" – in order to ensure they remain the real power in the land.
 
Zelaya believed this was a block on democracy, and proposed a referendum to see if the people wanted to elect a constituent assembly to draw up a new constitution. It could curtail the power of the military, and perhaps allow the President to run for re-election. The Supreme Court, however, ruled that it is unconstitutional to hold a binding referendum within a year of a presidential election. So Zelaya proposed holding a non-binding referendum instead, just to gauge public opinion. This was perfectly legal. The military – terrified of the verdict of the people – then marched in with their guns.
 
But there has been progress since the days of 1973, or even 2002. The coups against Allende and Chavez were eagerly backed by the CIA and White House. But this time, Barack Obama has said: "We believe the coup was not legal and that President Zelaya remains the President of Honduras." He called the coup "a terrible precedent".
 
His reaction hasn't been perfect: unlike France and Spain, he hasn't withdrawn the US Ambassador yet. He supports the International Monetary Fund and World Bank, which are vast brakes on Latin American democracy, and he bad-mouths Chavez while arming the genuinely abusive Colombian government. But it is a vast improvement on Bush and McCain, who would have been mistily chorusing "We are all Honduran Generals now".
 
The ugliest face of the Latin American oligarchy is now standing alone against the world, showing its contempt for democracy and for its own people. They are fighting to preserve the old continent where all the wealth goes to them at the end of a machine gun. I have seen the price for this: I have lived in the rubbish dumps of the continent, filled with dark-skinned scavenging children, while a few miles away there are suburbs that look like Beverly Hills.
 
This weekend, Zelaya will return to the country that elected him, flanked by the presidents of Argentina and the Organisation of American States, to take his rightful place. Whether he succeeds or fails will tell us if the children of the rubbish dumps have reason to hope – and whether the smoke from the deadliest 9/11 has finally cleared.



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Wednesday 1 July 2009

Debt is capitalism’s dirty little secret


 

 

By Ben Funnell
Published: June 30 2009 19:14 | Last updated: June 30 2009 19:14
 
Just why is there so much debt in the Anglo-Saxon world? Bankers and regulators know well that it is in nobody's long-term interests to have allowed borrowing to escalate to a position where the US now owes far more, as a multiple of the economy, than at the start of the Great Depression.
 
The answer is capitalism's dirty little secret: excessive lending was the only way to maintain the living standards of the vast bulk of the population at a time when wealth was being concentrated in the hands of an elite.
 
The amount by which the elite has benefited is startling, and illustrates the problem with lightly regulated free markets: the rich get much richer while the rest do not get richer at all. According to Société Générale economists, the inflation-adjusted income of the highest-paid fifth of US earners has risen by 60 per cent since 1970, while it has fallen by more than 10 per cent for the rest. As was recently pointed out in the New York Review of Books, the Walton family, of Wal-Mart fame, is wealthier than the bottom third of the US population put together – about 100m people. These are staggering statistics, confirmed by measures such as the US and
UK's ever-rising Gini coefficients, which estimate income disparity. Another way of putting this is that the share of profits in gross domestic product is at a 100-year high, or was until very recently.
 
Put simply, the benefits of economic growth have gone into the pockets of plutocrats rather than the bulk of the population. So why has there been no revolution? Because there was a solution: debt. If you couldn't earn it, you could borrow it. Cheap financing was made widely available. Financial innovations such as the asset-backed securities market aided this process, as did government-sponsored agencies such as Fannie Mae and Freddie Mac. Regulators welcomed it all while perhaps taking insufficient account of the moral hazard problem it posed: that ever-increasing leverage meant the authorities had to keep interest rates low, otherwise the debt burden would cripple consumption. This prompted more leverage, which exacerbated the problem.
 
A walk in any low-income area in the UK confirms this. There are BMWs in the driveways, satellite dishes on the roofs and furniture delivery vans on the streets. In both Britain and America the jobless were encouraged to buy their own homes. No one begrudges anyone else the right to own a home or buy luxury goods. The problem is that the luxuries need to be paid for out of earnings and the houses out of equity topped up with an affordable amount of debt.
 
The question is whether the debt load – total US credit market debt outstanding was $53,000bn (€38,000bn, £32,000bn) at the end of March, or 3.7 times GDP – is at all sustainable and, if not, how it can be lowered without sinking the economy. Those pushing extra debt in an effort to boost the economy via increased consumption point to the scale of assets backing the debt. The net worth of US households, including their houses and after counting debt, was $50,000bn in March, according to the Fed. Not a bad tally for 306m people: $165,000 each. However, the cost of servicing this debt as a proportion of income, even with record low rates, is at a 30-year high, above 15 per cent, as incomes have stagnated and the total level of debt has risen.
 
The debt burden has to come down, which means more saving and lower economic growth for many years to come. Along the way inflation is likely to return, probably sooner and more violently than most expect, which will prompt investors to demand a higher return and make it even harder for governments to tackle the debt. At best the debt will fall slowly over many cycles and simply trim otherwise resilient growth. At worst it could cause growth to lurch upwards before tumbling again, with all the attendant uncertainty that entails. At this point, no one can know which is more likely. I incline to the more benign view because of the size of household assets but, if the dollar's reserve currency status should come under serious attack, rates would have to rise to defend it and that could itself cause a consumption crisis.
 
What can be done? First, although it is not ideal, we should not be too hasty about abandoning the capitalist model. It is less bad than any other system yet invented. But we should redouble our efforts to increase productivity through innovation and creating new markets; simply squeezing lower-income workers is a bad option, which helped get us into this mess in the first place. This requires investment in education and research. Second, we have to learn to live within our means. This means spending less than we earn, perhaps doing without the BMWs, flat-screen television sets and leather sofas. Third, we should be careful in distributing the higher tax burden that we will inevitably have to bear over the coming decade. Very high marginal tax rates did not work in the 1970s and will not work now. That said, income disparity at current levels is a political time-bomb that needs to be dealt with. Finally, we should all come to terms with the fact that these are structural issues needing structural solutions; they need to be enforced over a longer time period than any one government's term. So we need a new political consensus, one aimed at reducing overall debt levels while reducing inequality by encouraging education, entrepreneurship and investment in innovation.

The writer is an asset manager at GLG Partners



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