Wednesday, March 20, 2013

APATHETIC ME!

APATHETIC ME!

Ajit Chaudhuri – March 2013


Introduction: Many of you will have come across the actress and director Revathy! I first did in a Tamil film screened at the students’ common room in the late 1980s. ‘Cute!’ I remember thinking (the sort of looks that get you the hero’s sister’s role in Hindi films, who smiles sweetly, mutters ‘Bhaiya’ a few times, and ensures that he gets hot food and avoids parental censure when he returns from his nocturnal wanderings – you know what I mean). The next time was when she was an election candidate in Chennai in the 1990s and attributed her subsequent loss to the political apathy of the city’s middle class voters. “These people”, she said, “will happily queue up for hours outside the US Embassy for a visa, but will not spend five minutes to vote.” This line stuck in my head, and I had the great pleasure of reminding her of it when I next came across her, this time in person in the mid-2000s (still cute, may I add).

I completely agree with her thinking! You may not get the government you want, but you always get the government you deserve! If you do not vote, you have no right to crib about the criminals, malcontents and dilettantes that represent you! If you expect good public policy, the country needs to have better people in parliament, and that in turn requires the DHLs (i.e. the decent, honest and law-abiding segments of the population) to vote! It is almost anti-national to be uninvolved! I beamed with pride when I got my election I-card, made the wonderful discovery that it took 20 minutes door-to-door (including walking 10 minutes to and from the polling booth) to exercise my franchise, and I now sanctimoniously flash my black-dotted finger at cocktail parties post elections. I am a responsible citizen! I belong! I have a right to crib and moan!

It was therefore a pleasure to come across a well laid out argument against these sentiments in a 1953 paper entitled ‘In Defence of Apathy: Some Doubts on the Duty to Vote’ by a British academic named WH Morris Jones . This note looks to outline the argument and examine its validity in the imperfect and illiberal parliamentary democracy that India is today.


Questioning the Duty to Vote

The thinking on the duty to vote has a background. First, it brings up memories of the struggle for the right to vote, a time of public debate and agitation and of piecemeal conquest (wherein one section of the community at a time won this right – a struggle that was brilliantly depicted in the recent film ‘Lincoln’), whose gains needed to be secured by demonstrating that this right was needed and valued. The failure to exercise this right is seen as a betrayal of the pioneers who fought for it for one’s own section of the community. Second, it is influenced by the political doctrine of the left, reformers and radicals who want change and see politics as the way to bring this about, who are impatient with the sceptical and the indifferent – ‘it is difficult for one who has seen the light not to despise those content with darkness’. They see ‘political consciousness’, ‘political education’ and a disposition to be ‘politically active’ as important qualities, within which a duty to vote is a basic ingredient. And third, it is influenced by the political doctrine of the right, who believe that the non-voter is usually moderately conservative and therefore that the lack of a duty to vote offers a premium to socialists at the cost of other parties.

Membership of a polity involves rights and duties. Some rights are universal, including (in democracies) the right to vote. Others are not, and are conferred upon some and denied to others depending upon individual or common needs. Similarly, some duties are universal (such as, to obey the law) and others not. Most countries’ laws do not recognize the duty to vote. Yet, there is widespread belief in a moral obligation to exercise the right to vote. To what extent does a right to vote constitute a duty to exercise the right? This is addressed by examining the grounds upon which the right is based.

The first relates to the individual level – the right to vote is necessary to express one’s political personality (therefore a universal right). However, the energies and inclinations that constitute a political personality are present in individuals in varying degrees; in some, they are missing, and others express them in non-political associations, such as religion, the club, and the family. ‘A taste for politics may not be as well defined as a ear for music, but in both cases their absence is sometimes best simply accepted.’ For such people, not exercising their right to vote is not a frustration of personal development.

The second relates to the section of the community an individual falls within – the wishes and needs of one section cannot be adequately understood or expressed by another, and public policy is better when it is subjected to pressure from all those it affects. The possession of the right to vote for its members may also be a defence against competitor groups. However, a vote is only one weapon among the many available to groups to exert power, and regarding society as a field of continuous struggle is possibly as wide off the mark as considering it a scene of perpetual peace. It is difficult to see group loyalty as so continuously important that it gives rise to a duty to vote.

The third relates to the body politic as a whole – the political environment is unbalanced when sections of the community are excluded from political influence. The state imposes duties upon its citizens (paying taxes, obeying laws), and justice demands that citizens should have corresponding rights to influence these duties, rights that are enabled through the right to vote. It is this that constitutes the most serious argument for a duty to vote – parliamentary democracy depends upon consent and participation, and the more of these the better. Withholding one’s vote makes the system poorer, and the non-voter should, at the least, have adequate reason for not voting.

But this is not the only way of looking at democracy! It is, above all, a way of dealing with business and going about things, distinguished by its love of trial and willingness to admit error – requiring expressions of interest and discussion of viewpoints so that they can be exchanged and reconciled. Participation and consent are useful, but only as aids to complete and adequate debate. All that is imperative for the health of parliamentary democracy is that the right to vote be exercised to the extent necessary to ensure that the play of ideas and clash of interests can take place. Heavy polls may be irrelevant to the healthy conduct of political business.

There is the special case of a widespread failure to use the right to vote resulting in threats to democracy, leading to the argument that the right to vote is secure only if the duty to vote is recognized. The apathy of the electorate is blamed for giving dictators and tyrants their opportunity – ‘people get the politicians they deserve, bad leaders indicate a lack of standards among those choosing them, and this lack is rooted in disinterest’ goes the argument. But, there are other explanations for dictators – inadequate or mistaken notions of democracy among the non-apathetic, impatient selfishness of group interests, and incompetence of those in power. ‘When parliamentary democracy fails, it is more likely because of a failure of vision, or will, or moral courage among those whose business is politics than the consequence of inadequate interest in politics on the part of the electorate.’


The Benefits of Apathy: Scepticism about the duty to vote is not the only ground for a defence of apathy – the apathetic have political virtues as well. Their presence constitutes a sign of maturity in a democracy – that it recognizes that there are and always will be people for whom political activity is a waste of time and talent. They are also beneficial to the tone of political life – a reminder of the proper limitations of politics, and an effective counter-weight to fanatics who constitute the real danger to democracy. A state that has ‘cured’ apathy is a state in which people believe in the efficiency of political solutions to problems of ordinary lives – an erroneous belief. ‘The best parts of the best people are those the parliament has nothing to do with, politics is the second best business of second best men, and a government of the people by the people only implies control of an indeterminate part of human affairs by an indeterminate part of the human race.’


My Own Conclusions: It is a pleasure to read arguments in favour of qualities that are not often promoted (sloth, indifference, half-heartedness, etc.), and this one presents an excellent counter to conventional wisdom on this topic. The key point, that the apathetic are an important component of democratic society and contribute towards a better political environment, is well taken. Debatable, for me, is the ability of the argument to transfer completely to India – our enhanced role of the state, our identity-based politics, and the difference in our thinking on the nature of rights and duties, preclude this. I, for one, will continue to exercise my right to vote! I will also, however, (post reading this paper) not look smug and sanctimonious in the presence of those who don’t. After all, ‘they also serve who stand and stare.’

Sunday, March 17, 2013

Football and Life

FOOTBALL AND LIFE

By Ajit Chaudhuri

Football’s not a matter of life and death. It’s much more important than that: Bill Shankly


For football lovers in the IRMA student community, life is easy! The parents are far away, the workload is light (and anyway everyone is up through the night), and spouses, where they exist, have yet to acquire bargaining power – there are few barriers to watching and playing as much football as you like. Things are, however, going to change once you step out of this cocoon and into the wild world. Work and bosses come into the picture, and spouses get secure enough to demand attention. The responsibilities will only increase as time goes on, both on the work and personal fronts, with the pressures of promotion, marriage, children, paying rent and school fees, etc., taking their toll. Ensuring your football entitlements requires delicate negotiation with stakeholders who do not share your view that this is a necessity and not a luxury or a dispensable time pass that you should ‘grow out of’.


Dealing with work and bosses is relatively easy (on this front at least)! For the most part, football is a weekend activity that can be ring-fenced from one’s profession. And as for the World Cup and the Euros, you can plan your leave well in advance for summers of even number years. If you can’t, don’t worry, most offices have a critical mass of people looking bleary eyed at this time – you merely have to blend in. And if you actually have some work to do? Well, the minimum that an IRMA education is supposed to provide is knowhow (and experience) in the art of bullshitting through days when you have been up the night before. Anyway, at least you know that, in 15 years, you will be the boss and then, if you choose to visit clients in Madrid when the Bernabeu is hosting an el Classico, to shift a board meeting because Ruben Kazan is playing Terek Grozny the night before, or to take Monday off because of aches and pains from playing on Sunday, well, there’s nothing anyone can do about it.


Handling the spouse requires a little more subtlety! Things start OK because she (you will have to excuse the assumption in this paper that the typical football lover is male, made because of the tediousness of gender neutral writing, s/he, his/her, etc.) is strategically encouraging in the early period of the relationship and, if she doesn’t come to watch you play, at least has nimbu-paani ready for you when you return and is good for a massage if you get hurt. Things also get OK later, when she becomes resigned to her fate, thinks of you as a ‘sunk cost’, and rationalizes that things could have been worse. It is the years in between, the juggling football with ‘lover boy’, ‘sensitive husband’ and ‘caring father’ roles, that are a minefield. So, here is some pooled wisdom from experienced veterans on negotiating this period.


First, play up those HR articles that point to the need for harmony and balance between one’s professional, family and personal lives, and thereby to the fact that family and personal lives are distinct. Put across that football is part of your personal life and that it is OK to be passionate about something.

Second, point to the golfers and bridge players in your friends group – their addiction levels are invariably more, and their time spent watching and playing the game also far more (there is a reason for the term ‘golf widow’). Crack jokes that emphasize this (such as – a golf foursome were playing a round when one of them peered over the course compound wall and told the others, ‘Hey, come and have a look, there are a bunch of nut-cases out there ice-skating on the pond in this blizzard’). You will seem tame in comparison.

Third, take the kids along to your games – she will be thrilled at the prospect of time to herself. Be warned, though, this usually lasts until the kids repeat words that, while suitable on the field when you have just been aggressively tackled, don’t sound so good on the dining table when her parents are visiting.

Fourth, get a mistress! Wife will think you are with mistress, mistress will think you are with wife, and you can play football in peace.

Fifth, play up the health aspect. Never waste the opportunities provided by early health problems of colleagues and acquaintances to make the point that this could have been you but for the time spent playing football.

And sixth, and only if you have the cojones, tell her that ‘a man’s gotta do what a man’s gotta do!’ and just go about doing it.


At some point, she will figure out that your love for football is not a liking, nor a passing interest, nor a one-night stand, but LOVE. And, luckily, most women understand love – the pleasure, the pain, and the void caused by separation!
And spouses, if you happen to hitch up with a football lover, here is advice (variations of this are available on the Internet) on passing those strenuous four weeks every four years that coincide with a World Cup – assuming that you have not been packed off to visit your parents or something.

1. Cede the TV for the month! Do not even glance covetously at the remote!

2. Do not cross the TV during a game! If it is necessary (for example, you are getting him a cold beer or some kebabs), ensure that you are not in the line of sight (do it crawling on the floor or whatever).

3. He will be blind, deaf and mute during the games (unless he requires the items listed in #2). Do not expect him to answer doorbells and phones or to deal with crying babies that have hurt themselves, etc.

4. If you watch with him, it’s OK to talk only at half time (but only during the advertisements) or after the game. If he’s upset about a result, do not say ‘get over it, it’s only a game’ or ‘don’t worry, they’ll win next time’.

5. Replays and highlights are important! It doesn’t matter how many times he has seen a replay, he still wants to see it again. Do not say ‘but you’ve already seen this, let’s watch something else?’ See #1 above!

6. Ensure that family and friends don’t fall ill, die, marry, have babies, or do anything that requires his attention or presence during the month.

7. Don’t waste your time thinking ‘thank God the World Cup is only once in four years’! After this comes the Primera Liga, the EPL, the Bundesliga, the Serie A, the Champions Trophy, the Euros, the Europa League, the Club World Cup, the Tippeligaen, the PrvaLiga, etc., etc., etc.!

Thursday, February 14, 2013

Reflections on Aid Effectiveness

SOME REFLECTIONS ON AID EFFECTIVENESS

By Ajit Chaudhuri


‘If you do not know where you are going, any road with get you there.’: Lewis Carroll


The past twenty years have seen many changes in the development sector. Where once the government was the critical agent of change, the baton has passed to NGOs, the private sector and, more recently, back to the state and to government-owned NGOs and panchayati raj institutions. Where once there was a comparatively equal relationship between the providers of resources and the implementers of interventions (or at least a semblance of a dialogue), funding agencies now exercise absolute power. Where ‘primary education’ was once seen as the critical sector, whose benefits lead and direct change in other sectors relating to development, ‘governance’ and ‘livelihoods’ have usurped that role. And finally, the positive relationship between development aid and development, that was once taken for granted, now has to be proved beyond doubt. It is this, the increased importance of aid effectiveness in the development discourse, that is the subject of this paper.


Aid effectiveness is defined as the extent to which an intervention has attained, or is expected to attain, its major relevant objectives efficiently, in a sustainable fashion, and with a positive institutional development impact (as per the Glossary of Key Terms in Evaluation and Results Based Management of the Development Assistance Committee of the OECD). Put simply, it is a measure of (or judgement about) the merit or worth of an intervention, and it addresses the question of whether one’s resources and efforts have brought or are bringing about desired change (or showing results). Put complicatedly, it is about whether an intervention is relevant, efficient, sustainable, and with impact. And the development sector has seen the burgeoning of an ancillary industry in the field of monitoring and evaluation to address these questions.


The need for monitoring and evaluation is aptly described in the following statements –

• If you do not measure results, you cannot tell success from failure.

• If you cannot see success, you cannot reward it.

• If you cannot reward success, you are probably rewarding failure.

• If you cannot see success, you cannot learn from it.

• If you cannot recognize failure, you cannot correct it.

• If you can demonstrate results, you can win support.


This is all very well, and this author hesitates to dispute the need for addressing questions around aid effectiveness, or for setting up monitoring and evaluation (M&E) systems to accomplish this. This paper does, however, look to question the hugely increased, and rapidly increasing, role of M&E within development, especially in proportion to the tasks of actually managing and administering development programmes. It does so by highlighting gaps between rhetoric and reality in the field of M&E. It suggests that, beyond a point, this is a ‘socially useless activity’ driven primarily by the needs of its proponents, and it distorts development aid by directing funds towards interventions wherein results are easily quantified and quickly discerned.


The first set of difficulties relating to aid effectiveness applies to evaluators.


An M&E system requires the outlining of objectives, inputs, activities, outputs, outcomes, targets and indicators for a development intervention, and the setting up of systems to collect, collate and analyze data around these and to disseminate information to different levels in a timely manner. At issue is the assumption that objectives are known, clear and consistent; this is at variance with all experience – they are usually multiple, conflicting, vague and occasionally repugnant, mirroring the complexity and ambivalence of human social behaviour. Choosing the objectives against which to monitor and evaluate invariably has little to do with an intervention’s actual purpose and a lot to do with ease of computation. Also at issue is the difference between outputs (defined as ‘the products, capital goods and services that result from an intervention) and outcomes (defined as ‘the short or medium term effects of an intervention’s outputs’), which serves to discern whether an intervention is merely ‘doing the work’ or actually ‘achieving results’. On the theoretical drawing board, the difference is like night and day; in the field, the chances of getting unanimity on an intervention’s outputs and outcomes is less than those of getting Afghan warlords to agree upon a peace plan.


Another matter is that of impact! By definition, impact happens in the medium to long term – often well after an intervention has ended – and it is rarely attributable to a particular intervention. The resources for an impact assessment are, however, available as a part of the intervention – either towards its end, or in its immediate aftermath, but never five (or whatever) years after the intervention when it is somewhat assessable. And the debate around attribution is circumvented by the attempt to show ‘contribution’ towards broad change, with nobody knowing quite what ‘contribution’ is.


And finally, can an evaluator actually trash a bad intervention or wholeheartedly praise an excellent one? The politics around M&E make this difficult, especially as people’s (including the evaluator’s) livelihoods are at stake. The latter leads to accusations of delivering a ‘snow job’, and therefore the need to throw in a few perfunctory negatives. The former leads to competing explanations about an intervention’s failure, and therefore whether it should be abandoned (the ‘theory of change’ underlying the intervention is weak), continued as it is (it has had insufficient time to achieve its objectives), continued with changes (its implementation is weak) or enhanced (it has insufficient resources to achieve its objectives) – and the directions set are invariable based upon political judgement rather than analytical integrity.


The second set of difficulties relating to aid effectiveness applies to the implementers of development interventions. Operations people are notoriously uninterested in data collection – their task is to make things happen, not to fill forms so that M&E personnel can later make suspect use of the information (including making M&E people look good and operations people look bad). M&E systems typically create rules and reporting requirements for implementers that divert them from their actual work and create perverse incentives towards a focus on short-term results and a stifling of innovation. A standard grouse in most implementing organizations in the field of development today is the amount of time spent, at all levels, dealing with compliance issues that have little relation to or bearing on their work.


A paper by Andrew Natsios of USAID entitled ‘The Clash of the Counter-Bureaucracy and Development’ in 2010 (available at www.cgdev.org) identifies two basic causes for this dysfunctional state of affairs. The first is the rise of a group of people he calls the counter-bureaucracy, who deal with issues of accountability and oversight and who pressure for increased scrutiny of aid effectiveness and for clearer demonstration of value for money. The second is what he terms ‘obsessive measurement disorder’ or the belief that the more an activity can be quantified, the better the policy choices and management of it will be. The two combine to cause ‘goal displacement’ – increasing the importance of formalistic goals over the substantive goals of an intervention and creating a situation wherein donor goals (that are largely set by the counter-bureaucracy) do not reflect the goals of the recipients of aid. Natsios says that it is a great pity that support for development interventions that can be transformative, but whose results are harder to measure and often do not emerge for years, is diminishing. He also makes some suggestions for issues around the effectiveness of aid. These include –

1. Devising a new measurement system for results that acknowledges that short-term quantitative indicators are not appropriate for all interventions.

2. Adopting different M&E methods for interventions in service delivery, institution building and policy reform.

3. Researching the effect of the counter-bureaucracy on aid effectiveness with a view to reducing the compliance and reporting burden.

4. Overtly recognizing foreign policy as an objective of some interventions, and judging these against political rather than development objectives.

5. Ending the use of disbursement rates as a performance measure.

6. Devolving programming and decision making to the lowest possible level.


Most development practitioners would find connection with Natsios’ views. This author, with 20 years in development behind him, would like to add that many issues around aid effectiveness stem from the fact that a critical mass of people in positions of power within the development sector have never actually managed an intervention at a level at which they have to interface with a ‘beneficiary’ community (a result of recruitment policies that parachute bright young people into the headquarters). To such people, as a wag remarked ‘poverty is like Bihar – never been there, but don’t like it anyway’. There is a conflict between their own belief that implementation is a grubby chaotic thing best left to the foot soldiers, and the knowledge that it is the basis for a development agency’s existence. The resultant insecurity sets aid effectiveness up as an instrument of power and control, rather than as a tool for the better delivery of development services. It is time for a re-think!

Monday, February 11, 2013

Sex and Central Banking

SEX AND CENTRAL BANKING

Ajit Chaudhuri, February 2013


'The only useful banking innovation was the invention of the ATM': Paul Volcker


Allow me to meander through three unconnected events before getting to Paul Volcker, inflation and bank regulation, which this paper is actually about.


One of the events that a fellowship at the London School of Economics (LSE) entitled you to gatecrash back in 2001 was the annual meeting of the UK-Germany Economic and Commercial Cooperation Society (or some such thing). I had imbibed too much wine with my lunch while there, and was therefore not prepared for what followed – a long and excruciatingly detailed talk on macro-economic policy by the then President of the Bundesbank, Ernst Welteke. When the torture finally ended, I mentioned to the others on my table that there should be a ban on central bankers speaking after lunch. They concurred, but also said that there was something comforting about Herr Welteke’s boringness – that the very qualities suitable for a person charged with the monetary policy of a nation were those that made for dull oratory. It seems a natural law that central bankers have the effect of chloroform on others. At a subsequent seminar at LSE, another speaker was discussing the cultural barriers to European integration and gave the example of Germany and Italy. To Germans, he said, Italy is a place one only goes to on holiday. And to Germans, all Italian men are gigolos – because that is their experience while they are on holiday. Germans, therefore, cannot conjure up an image of an Italian central banker – a huge barrier to discussions on formation of a European central bank with shared responsibilities and rotating leadership.


On a rare TV-watching foray away from sports channels, I came across a discussion on the slowing Indian economy and possible courses of action. The speakers, purporting to speak in the public interest, were castigating the government for being held hostage by the RBI’s (India’s central bank) refusal to lower interest rates. It was unusual to observe such unanimity on TV!


I recently read a biography of Steve Jobs (‘Steve Jobs’ by Walter Isaacson, Simon and Schuster, 2011), and this had me thinking about the concept of ‘greatness’ again. Is it the preserve of the rich and charismatic, of those who have built something from nothing, who have changed the way we do things, who have seen something others did not, or who have fought and won wars? What is the scope for those who have lived rather more ordinary lives, who have preserved and prevented rather than created or destroyed, who have not wowed the world with products and thoughts? Are only the former worthy of our awe? Or can the dull post-lunch speakers too aspire to greatness?


The financial collapse of 2008 soiled many reputations – within the financial industry, and among those entrusted to keep it in check. It also enhanced a few, and a man called Paul Volcker’s was one of these. This note attempts to make a case for Volcker to be considered ‘great’ – despite him being gawky in appearance (he’s over 2 meters tall), only comfortably well off (rather than obscenely rich) and, yawn, yawn, a central banker to the core.


Volcker’s achievements can be described through three episodes.


The first was his time in the Treasury Department (1969-1974), when he oversaw the abandonment of the post-1945 Bretton Woods arrangements that pegged the value of the dollar to gold, and of other currencies to the dollar at fixed exchange rates. As the Vietnam War escalated, demand in the US grew without accompanying increases in productivity, resulting in rising prices and, because of the inability to devalue the currency, uncompetitive exports. As investors began fleeing to other currencies, the US decided in August 1971 to end the dollar’s peg to gold and to usher in an era of flexible exchange rates. Volcker was entrusted with ensuring an orderly transition. Thanks to a combination of negotiation and coordination, the Bretton Woods arrangements were dismantled without sparking off a full-blown financial crisis. The relevance of this episode is still significant in the light of the Euro-zone’s struggles to cope with the havoc of maintaining fixed exchange rates.


The second was his war on inflation as Chair of the Federal Reserve Bank (or the Fed, the US’s central bank). In the 1970s, inflation was the bane of the US’s economy (12 percent in August 1979, a month after Volcker took over). Inflationary expectations had deeply set in, and had set off a ‘wage-price spiral’ – in plain English, wage negotiations that assumed 5-7 percent inflation and resulted in 7-9 percent wage increases, in turn causing prices to rise still further. Volcker designed a new Fed policy of explicitly slowing growth of money supply (rather than a central bank’s normal method of raising interest rates directly), forcing the US economy to slip into recession and its associated problem of unemployment (which peaked at 10.8 percent in late 1982). He stuck to his guns despite withering criticism from the US Congress and industry, and stayed the course until inflation climbed down. He then cut interest rates and made it easier to borrow money. Unemployment fell rapidly, and conservative economists (including Milton Friedman) warned of overheating and an imminent return to inflation. But Volcker saw the Fed’s worst failure as one of waiting too long to tighten monetary policy during the expansion, not of loosening too much during recession. History proved him right – a record breaking expansion followed, and inflation never returned.


The third was his championing of a ban on proprietary lending (when a firm trades financial instruments with its own money, rather than its customers’ money, so as to make a profit for itself) by commercial banks – now called the ‘Volcker Rule’. His reasoning was that commercial banks (where citizens keep their savings) are backed by deposit insurance and can borrow money from the Fed at a discount in a crisis, and this enables their access to cheap capital. Proprietary lending therefore involves using a state subsidy to make risky investments that leave the taxpayer on the hook if they fail – a sort of ‘heads I win, tails you lose’ situation. It also invariably puts banks in direct conflict with their clients. Volcker’s critics contend that the rule is untenable because commercial banks have to compete with entities (hedge funds, money market funds, international banks, etc.) that are not subject to these restrictions. There was furious lobbying to remove it – yet each time the rule looked in jeopardy some development would validate Volcker’s logic, such as news of Goldman Sachs knowingly shorting investments it was selling to its clients, or JP Morgan Chase losing billions on a single proprietary investment.


Indians have another cause to remember Volcker – he investigated the UN’s oil for food racket in Iraq that brought down our then foreign minister, Natwar Singh. Interestingly, our politician-bureaucracy mafia didn’t resort to their usual shenanigans in the report’s aftermath; gang-up, counter-accuse the investigator of racist bias, obfuscate by questioning the motivation, basis, methodology or numbers, etc. (the stunts being pulled on the Comptroller and Auditor General today). Volcker’s reputation and methodological rigour were impeccable and irreproachable – the @##&@# simply
shut up and resigned.


Great careers offer lessons to others, and Volcker’s is no exception.


To policy makers, the critical lessons are that of projecting confidence and credibility, and of articulating clear frameworks to resolve crises. Volcker understood that a government had to establish credibility in order to give policy makers the flexibility to act. In both the gold and inflation crises, it was the failure of authorities to make credible promises that invited speculative attacks by investors betting that the government would back down. In the 1980s, once people believed that Volcker was willing to administer the most painful medicines, and to keep at it until prices stopped ballooning, he earned the flexibility to bring inflation down to normal levels. Policy reversals undermine credibility and make rescue much more difficult – a lesson proved relevant by Europe’s chaotic response to its sovereign debt crisis. And also, serious crises cannot be tamed solely by improvised disaster control by well-intentioned officials – it takes explicit frameworks, that leave people in no doubt what the government will do when things go wrong. A benefit of a preference for frameworks over emergency meetings is, according to Milton Friedman, that it puts an end to the ‘occasional crisis – that produces frantic scurrying of high government officials from capital to capital’.


Volcker was tough on regulatory oversight. He believed that free markets are unable to govern themselves, that they can function only if people trust the system, and that conflict of interest and creative accounting are dangerous precisely because they destroy public trust. He said that bankers, like everyone else, would try to take advantage of a system that lacks oversight – and many so-called financial innovations are actually ways for firms to get around regulations or to avoid taxes, thus providing little benefit to consumers or to the economy. He articulated the need for clear and direct oversight of banks’ behaviour, saying that ‘commercial bankers understand when a bank examiner gives them a green light to lend. They also understand a red light, whether they like it or not, but most ignore the cautionary yellow.’


My own key take from Paul Volcker is his contention that honour is the most important thing a person has (he remembers that, in his earlier days in government, no banker worried more about his bonus than his reputation), and that public service is the most important thing a person can do – despite the modest pay and the considerable tribulations of government work.


To those of you still here, I would like to return to my question in page 1 of this note – can a man such as this be considered great? I am not sure I make a convincing case – there is something ‘unsexy’ about interest rates, financial regulation, and a career spent ensuring that the small guys sleep at night.


Further reading for those interested:

Goolsbee, Austan; The Volcker Way: Lessons from the Last Great Hero of Modern Finance; Foreign Affairs; January/February 2013

Silbur, William; Volcker: The Triumph of Persistence; Bloomsbury Press; 2012

Sunday, January 20, 2013

AJIT CHAU - FEMINIST?

AJIT CHAU – FEMINIST?

A 2-Pager by Ajit Chaudhuri, January 2013


Residents of the Shriram College of Commerce hostel in the early 1980s would remember the philosophy of not letting a girl pass by unappreciated – a philosophy that resulted in us honing our whistling techniques as girls moved in the space between the college and the hostel that our windows overlooked. We saw it as social service – this was the one place where homely girls got an opportunity to toss their hair, turn their noses up, go ‘Hhmmpppffff!!’ and saunter off simmering – and we were therefore not selective in our attentions. For some reason our college girls, despite many of them gaining confidence and life skills thanks to our efforts, did not see the benefits as we did, and most hostellers spent three years in college without speaking to a girl. But, in our own worldview, by virtue of not discriminating on shallow parameters such as looks, dress, size and carriage, we could have been labelled feminists.


I was turned away from feminism in the 1990s, when ‘feminist’ turned into a label for that angry and humourless woman in the ‘gender cell’ of whichever organization I happened to be drawing a salary from, and for illiberal bra-burners and lesbians who rejected the institutions of love, marriage and family and other values that most women, to my knowledge, held in common. The feminist did not speak for the women I met in the field; women who faced obstacles, violence and discrimination in every sphere of life with a mixture of courage, optimism and resignation, women who I admired very much and who I would do anything for. Instead, feminism seemed to stand for elitist women who had everything and wanted more, and to be fanatically dedicated towards a world of rights without accompanying responsibilities in which men were the enemy, and in which ‘date rape’ was a crime on par with paedophilia and mass murder (those who feel this is too strong, please Google ‘Antioch Rules’). I was not alone – many women were asking whether the feminist movement had gone too far down an extremist road whose basis lay in discredited totalitarian ideologies – Christina Hoff Summers, in her 1994 book ‘Who Stole Feminism? How Women Have Betrayed Women’ stated the charges clearly, and others included Elizabeth Fox Genovese (‘Feminism Is Not The Story Of My Life’, 1996) and Katie Roiphe (‘The Morning After: Sex, Fear and Feminism On Campus’, 1993). Was it possible to be a feminist, and in favour of equality, without holding radical and unpalatable views?


Summers argues that yes, it is, and makes a case for the ‘equity feminist’ (as opposed to the ‘gender feminist’ of the radical persuasion described in the previous paragraph) who believes that women should have full legal, formal and actual equality with men, but no special privileges. She quotes Elizabeth Cady Stanton, who in 1854 said; “we ask no better laws than those you have made for yourselves. We ask no other protection than that which your present laws secure to you.” She suggests that, once the battle for equality is won, nothing further should be demanded – women were perfectly capable of competing with men on a level playing field, and concepts such as ‘positive discrimination’ and ‘golden skirts’ (reservation for women in boardrooms) were as paternalistic and stultifying as their predecessors in keeping women down.


I would have been comfortable with this viewpoint had I not come across the book ‘Sex and Social Justice’ by Martha C. Nussbaum in the IRMA library (I suspect that the first word of the title drew my attention – like seeing an AK-47 in a Buddhist meditation complex) and read the chapter in which she makes a case for radical feminism. She suggests that women have agendas that are not addressed by ‘equity feminists’; that violence against women is still common, and that legal developments that recognize asymmetry of power between men and women are required so that sexual intimidation and harassment in the workplace and in public areas, domestic violence, and marital rape can be effectively prosecuted as criminal offenses, and so that women can bring a charge of rape without testifying to their previous sexual history. She says that ‘gender feminists’ have won recognition for bringing these problems out, are best positioned to contribute effectively towards addressing them, and that further pursuit of the radical agenda, and not its abandonment, is required for progress towards equitable gender relations. An interesting argument that makes as much a case for a radical element to any movement as it does for the promulgation of ‘gender feminism’.


So, am I a ‘feminist’? This does depend upon whether, as a male, I am allowed to be one in the first place – and I have sometimes felt like a black guy trying to get membership in the Ku Klux Klan when I ask the question. And, if I were one, what category of feminist would I fall into (and what is my thinking on the feminist discourse on divisions between ‘strategic’ and ‘practical’ needs and stuff like that)? My wife has an answer – she says I am a ‘faux feminist’ (she actually uses a much ruder term that I am unable to repeat here) – the type who knows all the right words and has the ability to come across as enlightened at meetings, especially when there are impressionable women around, but is an unadulterated pig deep down where it matters.


I’m not so sure! I was at a workshop in Afghanistan recently in which I got into a debate with other participants on whether women’s inferior position in society was a result of the inviolable laws of nature, and they looked at me as though I was a bra-burning lesbian for arguing that the we would all be better off if our homes were more equal. I must confess that I also snidely enquired as to the whereabouts of these inviolable laws of nature when the (female) US Secretary of State visited the country and decided their budgets. Meeooww!!


It would be convenient if such views were confined to places where they could be passed off as those of uneducated peasants who don’t know better. Sadly, anyone following the run-up to the last US Presidential election would know that this is not the case. Worryingly, the presence of many successful women out there (who have made it on brilliance and hard work, i.e. not the wives, mistresses and daughters of the powerful), while providing a visible contradiction to the ‘women are incapable’ viewpoint, does not decrease subscription to the ‘natural laws’ argument. Is society actually better off if women stay at home? Is a community with a large number of unemployed women nicer than one with a large number of unemployed men? The fact is that many people think so! Feminism, at some point of time, will have to address the problem of male insecurity. To do so, the movement will have to include of a wider variety of viewpoints. To conclude – it is in the interests of feminism for the likes of Ajit Chau to be feminists. Here I come, ladies!

Thursday, December 27, 2012

You've Come A Long Way, Baby!

YOU’VE COME A LONG WAY, BABY!

By Ajit Chaudhuri – December 2012


Returning to management school after 22 years offers opportunities for longitudinal comparisons. What has changed from the late 1980s? The short answer is – two things! One, communications! Computers, cell phones and the Internet have revolutionized research, assignment writing, and people to people interaction. And two; there are more women students on campus (to those ascribing my return to this factor, let me quote the statistical adage ‘correlation is not causation’)! In fact, 2012 is an inflexion year for IRMA – the first time that an incoming batch of prospective MBAs has more women than men. The proportions can only partially be attributed to IRMA’s policy of positive discrimination (yes, the admission criteria for women is lower), this trend is seen in most institutions of professional education and is more a testament to women’s increased access to education, their intelligence and concentration levels, and their capacity for hard work (but don’t worry, my dear male readers, we will always reign supreme in class 8 mathematics).


IRMA is coping admirably with this change. Men’s hostel blocks have been converted into women’s ones (I wonder what happens to the piss-pots and graffiti), north Indian type behaviour in common spaces (comment-passing, testicle-scratching, et al) has been clamped down upon, and courses on gender attitudes introduced. Even the evening football game welcomes women participants. But will the world that these highly qualified women (HQWs for short – caused by my reluctance to type and not my eagerness to typify – and by HQW I mean only the achievers among them, and not those passing time between college and marriage) enter upon graduating be as kind? This paper looks at this world, at the difficulties these young women will face in converting their potential into achievement, and offers some advice.


HQWs entering the job market today have much to thank previous generations of HQWs. Many battles have been fought (and won); glass ceilings smashed, and stereotypes broken. Critical decisions and discussions now happen in office (and not in golf courses and bars), and most modern recruiters are gender blind. But some remain! The first is the conflict between getting ahead and raising a family? The fact is that most achievers follow a similar career path; they are identified in their late 20s and early 30s, and are provided with serious opportunity soon after – usually a position in which all functions converge, like a cost or profit centre, or managing country operations in Kazakhstan or somewhere, where the buck stops at their desks. This is a 24/7 position, with little scope for distraction or a full night’s sleep. But this is also when their career paths deviate from that of their peers, leading to senior management, directorship, and even top management – while others languish in the middle and contemplate early retirement and organic farming or whatever. HQWs with young families tend to refuse this opportunity for obvious reasons, possibly expecting that it will knock again when they are better able to manage the strain. By doing so, however, they wave goodbye to the corner office – forever. Another trap is that of flexi-time, tele-commuting, and part-time work – no matter how attractive they are, and how much a woman needs them to balance demands on her time, taking these options in most organizations is an effective way of communicating one’s unsuitability for the trials and tribulations of senior management.


If you do manage to negotiate these traps, or if you don’t have children and can afford to give your career everything, you will find that the fast track is more than about being brilliant, hard working and strategic. You also have to be ruthless – a trait that cannot be acquired or learnt – and you have to build relationships with mentors and mentees to give yourself an edge. Unfortunately, HQWs are at a disadvantage here; the socialization of girls in India as participatory, care giving and communitarian is difficult to rub off (despite management school’s best efforts), and mentor-mentee relationships are close and intense ones that discourage the crossing of gender lines (and lead to all sorts of rumours, and often the real thing as well, when they do).


The other battle is that of finding suitable life partners; men who will be a positive factor in one’s career and its advancement. At one level, this is easy – most men are similar, and one merely has to avoid the future wife beaters and the mentally ill (easily said, but they are ten percent of all men and these traits only show up about a year after marriage), and see that he is fed on time, that there is no conversation when sports is on TV, and that one doesn’t shout at him in front of his friends, for marital relations to be clement. This, however, does require the management of expectations – and HQWs often go wrong here, there is this vision of the perfect man waiting for them; high income, handsome, educated, sensitive, supportive, blah, blah, blah, a vision that is played up to by the genre of films known as chick flicks (in real life, if such men do exist they usually already have boyfriends). Coupled with this are the facts that the office, where HQWs spend most of their time, is not a good place to hunt, the Internet is full of perverts, and the combination of intelligence and a fast track career is not exactly an aphrodisiac to most men.


What is the likely outcome? Well, by their mid-30s they become desperate (it is now or never regarding having children), they find that the laws of supply and demand are not in their favour (there are few single straight men in their age group, and they are invariably having such a good time that they are loath to change their status), and they end up as fodder for otherwise unsuitable men. How can the coming generation of HQWs circumvent such a scenario? One, be a little nicer to your admirers in management school, and accept a few flaws (male students, I want a kickback for this nugget of advice) – the known devil is often better than the deep blue sea! Two, if you have to run around with older (married) men, they should drive a Ferrari. And three, if two converts into marriage, have a kid quickly – this is actually an unwritten rule for all second/third/etc. wives, it locks the guy in and makes treating you like he did your predecessor an expensive (and, to you, lucrative) proposition.


To conclude, welcome to the world, ladies! May your battles be different from those of earlier generations, may you find an appropriate balance, and may you change the world! And yes, may you stay, as Dylan said, forever young.


Some additional reading for those particularly interested in HQW issues:

Slaughter, Anne-Marie; Why Women Still Can’t Have It All; The Atlantic; July/August 2012 (available on-line)

Hewlett, Sylvia Ann and Carolyn Buck Luce; Off Ramps and On Ramps: Keeping Talented Women on the Road to Success; Harvard Business Review; March 2005


Friday, December 7, 2012

The Proximity of Greatness

THE PROXIMITY OF GREATNESS

Ajit Chaudhuri – November 2012

‘Be not afraid of greatness: some are born great, some achieve greatness, and some have greatness thrust upon them!’






My first tryst with greatness was in 1978! I was watching Brazil play at the World Cup (in those days, one did that on a small black and white TV a few days after the game was played), when Roberto Rivelino came on as a substitute and was referred to as ‘the great Rivelino’ by the commentator whenever he touched the ball. Wow, I remember thinking, and what must one do to earn that sort of respect? I got an answer at a discussion about the Indian footballer Inder Singh in the early 1980s – this was among spectators in the cheap seats during a football game at Ambedkar Stadium in Delhi, long after Inder had retired, when a guy said – ‘Maine Inder ko jeet-tey dekha, maine Inder ko haartey dekha, lekin maine Inder ko kabhi bey-imaani kartey nahin dekha’ (roughly translated as ‘I have seen Inder win, I have seen Inder lose, but I have never seen Inder do something dishonest’). And that, I thought at the time, is how I would like to be remembered – assuming that people are willing to overlook the matter of a missing ashtray from the Maurya Sheraton Hotel that somehow turned up in my hostel room back in college days.


But, I digress! This paper is not about either honesty or football – it is about ‘being great’! There is something pathetic about monarchs who have ‘the great’ appended to their names (Peter, Catherine, Frederick, et al), it being unlikely that their subjects had much choice on the matter – a mere ‘His/Her Majesty’ or ‘Royal Highness’ would no doubt have ensured that their heads faced a separate existence from the rest of their bodies; in that respect, I always preferred Ivan the Terrible on his choice of moniker. Modern day greatness is a little different in that it is conferred by hagiographic biographers upon anyone with money and a penchant for PR , and there is a veritable raucousness all around from the multitudes clamouring for the title. I’m not sure how many people actually merit ‘greatness’, more so in their own lifetimes, when time has yet to put their achievements into perspective and smoothen memories of the chaos they have caused. The living great are few in number and, except possibly for Nelson Mandela, difficult to recognize.


Dr. Verghese Kurien was already great when I entered IRMA in 1987 – Operation Flood had happened, and the enormity of the achievement, that households across the country had reliable access to that most basic of products, and the subsequent recognition of it, had set in. One got the occasional glimpse of him in the two years that I was there, mostly as a chief guest to IRMA functions, and one saw the unbridled power that he held, as also his ruthlessness, charm and sense of humour. An occasion I remember was some function in the IRMA auditorium that the students were invited to, presumably to put bums on seats, and Dr. K introduced the chief guest (the then central minister Margaret Alva) by saying that they had met before and that she had called him a male chauvinist pig. So when Ms. Alva came on to speak, we were spared the usual politician monologue about how much the government was spending on this, that and the other and how grateful we should be to it for our existence; she devoted all her time to communicating that she had in fact not called Dr. K an MCP, she had merely wondered why the National Dairy Development Board’s emblem was a bull (and not a cow).


The difficulty for young students at the time was that Dr. K’s achievements were not up for question – which was fine – but neither were the cooperative principles that enabled them. There was no space for dissent or scepticism, (Dr. K didn’t share Sir Karl Popper’s belief that something is best proved by focusing on disproving it and succeeding by not succeeding), and there was an Orwellian bombardment of the ‘Anand Pattern’ down our throats. Needless to add, we grew allergic to the word ‘cooperatives’ while we were there, and those who saw value in them did so in spite of, rather than because of, IRMA. It was only later that one grasped the enormity of his achievements and the possibilities for poverty alleviation that cooperation provided; when one had a better understanding of the scale at which Dr. K worked and of the barriers he faced in a country that incentivizes inactivity, obsequiousness and slime.


What can the wannabe ‘greats’ of today learn from Dr. K about greatness? In this paper, I hazard to venture some simple guesses.

One, the great give meaning to the terms ‘values’, ‘vision’ and ‘mission’ – they are not mere buzzwords ticked off on some strategic plan – and they communicate this successfully to others. This trait separates the ‘great’ from other competent leaders, institution builders and administrators. And it is this that is missed most when they go, when a vision vacuum sets in in their wake.

Two, all good leaders share the traits of brilliance, self-belief, drive, attention to detail, the ability to work extremely hard and to communicate well, and ruthlessness. The great, in addition, use these traits for public benefit and the larger good – personal pecuniary matters tend not to have obsessive allure.

Three, the great are scrupulously honest and they ensure that the institutions they set up share that characteristic. Dr. K had no shades of grey regarding integrity – he used to say that it was like pregnancy and virginity in that you either were or you weren’t, and if you weren’t you were not going to survive with him. New entrants to NDDB were told that the institution did not pay bribes, and also that it did not accept not paying bribes as an excuse for work not getting done – one had to get the work done without paying off anyone.

Four, the great recognise greatness in others. Visitors to his home in his later years were invariably shown his proudest possession, a large photograph of Mount Everest (or was it a painting?) that had been personally signed, at different times, by Tenzing and Hillary. This had the pride of place on his wall, and was given far more prominence than his own respective Padma awards.

Five, greatness rarely ends well; the great have an innate inability to fade quietly into the sunset. Those that don’t get assassinated or taken away by more natural means early enough tend to stay on their thrones until they are prised away, finger-by-finger, kicking and screaming all the way.

And six, and to conclude, the great live on in the people they have touched – more so than the institutions they have created. My father visited Anand earlier this year and dragged me off, against my will (irreverence and scepticism being somewhat ingrained in my character), to meet him. I was surprised later by how sentimental I was during this visit, when the enormity of what I (and so many others) owed this old man and how much we are what we are because of him kicked in. So thanks, Dad, for forcing that visit!




Acronyms
IRMA Institute of Rural Management, Anand
MCP Male Chauvinist Pig
NDDB National Dairy Development Board
PR Public Relations