Can India Compete With China?

IMG_0131There’s perennial hope in the West that India will succeed. Having won the Cold War, advocates of democracy and rule of law aren’t eager to replay it and have a Communist country win–not even one that yields to market forces in large part.  Citizens of democratic nations want reaffirmation that democratic rule and rule by law, not men, is the superior paradigm. We acknowledge that such a system is rarely easy, but live with the words of Winston Churchill ringing in our ears:  

Democracy is the worst form of government, except for all those other forms that have been tried from time to time.

When I found out that I was moving to India, I read all that I could find on India in magazines I subscribed to, such as Foreign Affairs, National Geographic, and Wilson Quarterly. Needless to say, there was a lot to read. Besides India’s nuclear programs, both energy and weapons, I hadn’t followed its role in the world. These articles took me on a roller coaster ride. If one went back many years, no one expected much of India. Then, a few years back, massive enthusiasm blossomed that India was going to rocket off and leave India in its dust. Then I got to the most recent articles, which did yet another turnabout–saying that India’s growth had been ephemeral and no one should expect much from the country in the near future.

India has a number of advantages. Almost everyone who is capable of publishing is fluent in the de facto international language of business and academic publication–namely English. India has as abundant a supply of cheap labor as anywhere. Indians have a culture that values education. They are building a first-class university system by, in part, having sent students to the very best of academic institutions globally. Their universities are attracting foreign students. This, in combination with such a big population, has given them the potential to build impressive student bodies.

So, why isn’t India competitive? The first thing that should be stated is that things are never as simple as they appear in aggregate. In some domains, India is competing quite nicely–and not just with China. Here in Bangalore, it’s apparent that large IT companies see big advantages in doing business in India.

I made a recent trip to Hampi and was amazed to see how successful India was in building up wind power generation in central Karnataka. India is 5th in installed wind capacity overall. Many democracies have difficulty getting traction with wind because the public views the turbines as an eyesore.

Still, India has its problems. Political and Economic Risk Consultancy (PERC) surveyed business leaders about Asian bureaucracies and found India to be the worst bureaucracy in Asia.  On a 1 to 10 scale, where 10 is the worst possible, India rated a 9.21. This isn’t a surprise in the least. It seems to be common knowledge that business leaders who move to India do so in spite of India’s governance, not because of it.  India’s bureaucracy hasn’t embraced the IT-revolution. It’s interesting being in Bangalore, where IT-companies are state-of-the-art, and being asked for the same copies of documents a half-dozen times because the information is only stored on non-networked PC hard-drives–and paper files are collected but don’t seem to be organized in any way.

An ethos of corruption is ubiquitous in India. Police officers have been known to sit in parks and solicit “admissions fees” from tourists. I’m pretty sure I saw a shakedown in progress this past week when our car went through a toll booth on a toll road we had already paid for and two guys standing outside in front of the toll-taker insisted that our driver pay for the toll that he had already paid not ten minutes before. Being from a country where corruption is punished severely, I’m ignorant of the process of bribes. (I suspect this is why I’ve had so little success in getting anything done that involves the Indian bureaucracy.) For a less anecdotal experience, one can turn to the “Corruption Perceptions Index,” which places India in the bottom half among all nations.

One may wonder how a democracy retains a culture of corruption. Usually, citizens of a democracy get fed up and start voting their disapproval. At the Bangalore Literature Festival, I heard an interesting policy panel featuring a politician, a retired general, and a policy pundit. It was said that there is a high degree of apathy among the Indian middle class. Indian voter turnout rates are generally below 60%. There’s a belief that those most capable of affecting change are relatively happy and, thus, unwilling to rock the boat. I don’t know how true this is, but it seems that India is having trouble defeating some of the problems that wither on the vine in the face of a politically active public.

It also seems that there is a segment of the population who are completely cowed. This is a legacy not only of colonial repression but also of caste repression. While castes have been done away with, there remains a large segment of the population who are accustomed to doing just as they’re told without questioning and without making moves to get ahead.  Perhaps, because they believe they exist in a world in which there’s no getting ahead.

India’s abundance of cheap labor may be a curse as well as a blessing. While cheap labor has brought in foreign direct investment, it has also contributed to a business culture that doesn’t seem to value increased productivity. As an example, if one goes into a small shop in Chicago or Copenhagen or even Beijing, it’s likely that a single salesperson will show one merchandise, ring it up, and bag it. If it’s a big store, there may be a two person interaction–salesperson and cashier. In an Indian store, a salesperson will show one merchandise, a clerk will write up an invoice, one will take that invoice to a cashier, that cashier will take one’s money and hand one a carbon-copy of the “paid” stamped invoice and direct one to a pick up window, a bagger will bag your purchase, and  a “checker” will check your receipt and hand you the bag. I love specialization as much as the next economist, but this is a Rube Goldbergesque approach to retail operations.

If India wants to be a first-rate power, it needs to take on corruption, bring its bureaucracy into the 21st century, and its population needs to realize they can have a more satisfying life than waiting around for someone to need them for a momentary job. The citizenry needs to value good governance, and businesses need to figure out how to increase productivity.

MASTER WORKS: Apology by Plato

ApologyApology by Plato

My rating: 5 of 5 stars

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Apology is Plato’s account of the trial of Socrates. This brief work presents Socrates’ defense of himself as well as his reaction to the death sentence verdict against him. Of course, it is all through the lens of Plato, as Socrates left us no written works.

Socrates was charged with impiety and corruption of the youth. He acknowledged both that he was eloquent and that he was a gadfly of Athens (the latter being a role for which Socrates believes he should be valued.) However, he denied both of the formal charges.

Socrates refuted the charge of corrupting the youth first by denying that he had taken money in exchange for teaching. Taking money was a component of this charge. Socrates’ claim is supported later when Socrates tells the court that he can only afford a very small fine, even in the face of the alternative–a death sentence.

Socrates says that he sees nothing wrong with taking money for teaching–if one has wisdom to share. Socrates says that he has no such wisdom, and suggests the philosopher/teachers that are taking money aren’t in error for taking money, but rather because they really don’t have wisdom themselves.

This is summed up nicely by this pair of sentences, “Well, although I do not suppose either of us knows anything really beautiful and good, I am better off than he is–for he knows nothing and thinks he knows. I neither know nor think I know.”

While Socrates raised the ire of the Athenian leaders with what they no doubt believed to be his arrogance, in fact it wasn’t that he thought himself wiser than they, but that he thought they were deluded in thinking themselves wise.

Socrates’ lesson remains valid today. It is the scourge of all ages to think that have finally attained true understanding of the world. Our posterity may know more, but we know all of the essentials and are rapidly converging on a complete picture of our world. We think our generation to be humanity’s sage elders, when, in fact, we are the impetuous teen whose growth spurt has made him cocky. I would propose to you that in all likelihood, even today, the sets of “that which is true” and “that which humanity ‘knows'” form a classic interlinking Venn Diagram. That is, some of the body of knowledge that we take to be proven true is, in fact, false. This occurs because we cannot accept that there are things we are not yet prepared to know, so we use sloppy methodology to “prove” or “disprove.” This one reason we have all these conflicting reports. E.g. coffee is good for you one week, and carcinogenic the next.

VennDiagram_WhatWeKnow

Socrates uses the method that today bears his name, i.e. the Socratic method, to challenge the arguments of Meletus, the prosecutor. The Socratic method uses questions as a device to lead the opposition to a conclusion based on premises they themselves state in the form of their answers. Socrates proposes that if it is he alone who is intentionally corrupting the youth, they would not come around–for no one prefers to be subjected to evil rather than good.

Socrates denies the suggestion that he does not believe in the gods, and in fact indicates that the very suggestion by virtue of the charges against him is a contradiction. What Socrates is guilty of is encouraging those who come around him to develop their own thoughts on god, and not to subordinate their thought to anyone–an idea the leaders found disconcerting.

Socrates goes on to say why he is unmoved by the death sentence. He wonders why it is thought he should beg and wail, when he doesn’t know for sure that an evil is being done against him.

The moral of the story is that those in power fear and will attempt to destroy advocates of free thinking.

This book should be read in conjunction with a couple other Platonic Dialogues, Crito and Phaedo.

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My Humble Narcissistic Opinion on Organizations

Whenever an organization is built around an idea or set of values, that idea or set of values shrinks dwarf-like into the background. What looms large is the imperative to protect and expand the organization.

The organization is an organism, but one whose only growth governor is the attractiveness of its ideas. You think those ideas are the organization’s genes, but they aren’t. They aren’t the codes by which the organization lives. They aren’t its DNA. They are its skin. But even the loveliest beauty queen can be a gloppy, cancerous mess on the inside. No, the code that your organization lives by is the same viral code by which all organizations live.

Step 1: Preserve the organization.

Step 2: Grow the organization.

Step 3: Annihilate competitors.

Step 4: Repeat steps 1 through 3 until you’ve consumed the world.

You say that I’m not a loyal Party man. Guilty. I cannot be loyal to Party without being disloyal to my own mind. If one’s views mirror those of the Party, how likely is it that one didn’t twist one’s ledger into line? Not likely, I’d say. My thoughts are not static. They evolve. I learn. I will no more subordinate my belief s to a Party then I will chain my neck to a rock.

Your Company doesn’t make widgets, it makes Company.

You say I don’t believe in God. I see God in every leaf. I see him in the new fallen snow. I see him in the confident aerial leap of a nervous squirrel. I feel the pulse of him in my hand when it holds another hand. No, what I don’t believe in is religion. They say the problems of religion are the fault of flawed individuals. I say they have it exactly backwards. There wasn’t an evil cell in Hitler’s body, but together they formed an evil seed. Yet, one man cannot make a holocaust. Ever increasing numbers had to fall in love with a skin-deep mirage of an idea, and ignore the ugliness inside.  A man can only be as evil as the world lets him, but a government? a church? Those, my friend, can consume worlds.

Our Most Beloved and Most Deadest of Presidents

Source: Kennedy Library

Source: Kennedy Library

Presidents live the ultimate catch-22, the only way to reliably boost their approval ratings is to shuffle off this mortal coil (i.e.become worm food.)  The more decomposed a president, the more fond our remembrances of him. The worst thing that anyone ever says about a long dead president is nothing at all. When was the last time you heard a scathing character impeachment of Millard Fillmore? (I do realize that a person with the supreme narcissism needed to be president may find silence more insufferable than being called the son of a syphilitic donkey whore.)

(Quick, without looking, name a president from the 19th century other than Jefferson or Lincoln [or Fillmore]?) FYI- there were 23 or 24 of them. If you drank your entire cup of coffee before you could come up with one of the other twenty names, congratulations you are a typical American– or an exceptional non-American.

I first noticed this phenomena when watching the Reagan funeral. Everyone from all walks of life had great things to say about our 40th president on that day. However, while I was still a minor at the time, I distinctly remember half of the country loathing the man spectacularly and engaging in ad hominem attacks against him at any opportunity. Well there was one period during which no one was saying horrible things about Reagan’s character and that was  during the brief period after the assassination attempt when his opponents thought he might die — at which point they went into dead presidents mode. Had Reagan passed away at the hands of John Hinckley, he would’ve achieved a level of freedom from being crapped upon usually reserved for a our first few (long decomposed) presidents.

Still, Reagan has achieved the broadly beloved status of being the Democrat’s “In-your-face President” just like Kennedy serves in that role for Republicans. An “In-your-face President” is one that political parties use to attempt to show that their current opposition is on the lunatic fringe by indicating that that iconic leader supported something vaguely, roughly approximal in a similar sort of way to what they are trying to do in the present day. These statements being followed by a silent, but understood, “IN YO’ FACE.”

I’m sure that when Carter dies, equally lovely things will be said about him — though never has a bigger train wreck of state been seen then the term of James Earl Carter. To be fair, some of the wheels that rolled off the RV-of-state were not his fault, but we  give all the credit and all the blame to the president. Why do you think Clinton is always grinning like he just had sex? No, it’s not because he just had sex– though he did (the speaking circuit is like fishing with dynamite), it’s because he reigned over the big bubbly part of the bubble. When we were rich because we thought we had a lot of valuable stuff, before anyone bothered to look inside and see what we had was rotten at the core.

Admittedly, Nixon’s demise did challenge everybody’s ability to grin and say nice things.  Comments were made such as, “That Checkers was a good boy, such a good boy, yes he WAS… YES he WAS. Oh yeah, and how about that China thing, that was a real work of diplomacy.”  (Checkers was one of Nixon’s dogs, made famous by a Vice Presidential speech of the same name.) The word “China” was used at Nixon’s funeral more than it was used at the Chinese Conference on China in Beijing, China. Of course, there wasn’t much nice to say about Nixon. Democrats can’t even take advantage of the fact that the Environmental Protection Agency (EPA) was a Nixon Administration initiative. Nixon can’t be an “In-your-face President.” It’s too much like slapping your opponent with a bloated dead fish; you may hit them, but you’re going to get the stink on you never-the-less.

5 Minefields of Armageddon for 2013

National Land Image Information, Ministry of Land, Infrastructure, Transportation & Tourism, Japan

National Land Image Information, Ministry of Land, Infrastructure, Transportation & Tourism, Japan

1.) Ever heard of the Senkakus? What about Diaoyus? If not, you should look them up. When you’ve been wearing a gas mask for the 33rd day straight, you may want to know about the chunks of rock in the East China Sea that we tripped into nuclear winter over. Simmering tensions between Japan and China have been flaring up over these islands of late. So you’re probably wondering who lives there who’s so important that it’s worth wandering through a minefield that could trigger World War III. If you answered, “absolutely no one,” give yourself a prize.  They’re uninhabited. It’s not the islands themselves that anyone gives a rat’s as about, it’s the ramification they have for underwater drilling rights.

The reader may accuse me of hyperbole. (Shh! Dont tell anyone, but– of course– that’s what I do.) After all, China has a boldly stated “No First Use” policy. That is, they claim they will not use nukes in a first strike. Given that Japan isn’t a nuclear weapons state (NWS), there doesn’t seem to be much risk. Except that a.) Japan lives under the U.S. nuclear umbrella;  b.) Japan is the non-NWS that could develop nuclear weapons in the shortest time imaginable — they have the material, infrastructure, and technical know-how (okay, Germany is in the same bag); and c.) see #2

KimJongUn3

2.) North Korea conducted its third nuclear test. This presents a risk because: a.) it provides an incentive for Japan to build its own nukes (particularly if faith in the US umbrella wanes.) b.) [and more importantly] Kim Jong Un has too many yes-men, and no one to slap him in his chubby face and say, “are you smoking powdered unicorn horn?” In other words, he doesn’t have a good idea of what he can get away with before the world unleashes a crate of whoop-ass on his sad country. So he wanders in the minefield.

3.) Europe is getting depressed. Fat and happy Europeans are productive and polite. Downtrodden Europeans have been known to swallow some pretty despicable narratives, and– in doing so– drag the world into war. At the moment this seems really far-fetched. These political movements are at best in the political fringe of countries on Europe’s fringe, right? Maybe so. Time will tell.

4.) If America’s economy is crash-landed, everyone is going to be hit by the debris. This will be depressing, see #3 and then multiply globally. Times like these  echo Churchill’s comment, “Democracy is the worst form of government, except for all those other forms that have been tried from time to time.” Any person, company, or government that sees the train coming in the distance but can’t find its way off the tracks can’t be expected to thrive for long.

5.) India and Pakistan, enough said…

TODAY’S RANT: Emerson Haters

Ralph_Waldo_Emerson_ca1857_retouchedI began reading the Best American Essays of 2012 and was disappointed by the first  essay entitled, The Foul Reign of Self-Reliance by Benjamin Anastas.

Self-Reliance: In or out of the canon?:

Anastas rails against the essay Self-Reliance by Ralph Waldo Emerson. The only nice thing he has to say about Emerson (as a parenthetical insert) was that the philosopher spoke out against slavery and the poor treatment of American Indians.  Anastas suggests Emerson’s essay should be eliminated from the  canon of required reading. This desire to censor ideas that he (or his collective) find objectionable is a telling indicator of why he finds Emerson so vile. In my ideal world, students would read Emerson and Marx and Jefferson and Socrates and Confucius and eventually even the likes of Hitler and they’d make up their own minds about what ideas were sound and which were suspect. I’m  confident that on the whole that a free-thinking people will overwhelming reject the poorest and most vile of ideas. Obviously, not all will draw the same conclusions as I about which ideas are best, but I prefer the company of such people to those who completely agree with me but have turned their thinking caps off. Anastas seems to favor control of the flow of ideas to those society or teachers or some collective finds agreeable.

An undeniably powerful idea:

About all that Anastas and I agree on is that the thesis of Emerson’s Self-Reliance is powerful. By a powerful idea, I mean one that has the ability to grab a reader by the collar and demand his or her attention –whether they like it or not. Where Anastas sees Emerson’s ideas as perniciously powerful, I see them as sagely powerful. While we seem to be in near complete disagreement, I don’t want to go into a point by point refutation. I want to focus on what I believe is Anastas’s central point, that our current political dysfunction is the fault of Emersonian thinking. On this I think Anastas is shows perfection in his wrongheadedness.

The reason I don’t bother arguing point by point is because  much of my difference of opinion with Anastas comes down to being on radically different places on the Borg-Anarchist continuum. Reasonable people may disagree. I have a set of beliefs that inform my position on the Borg-Anarchist continuum that range from my opinion on free will to ideas about the value of optimizing (minimizing) what I would call “social friction” (others have used that term in another way.) That’s neither here nor there, Anastas may have his own justification for his views, though he doesn’t lay them out. For example, he uses the phrase, “excessive love of individual liberty” without indicating what he believes would be the appropriate amount to love liberty, let alone how he drew his conclusion. It may be that he doesn’t have a rationale, but rather has suborned his views to some collective that he believes is representative of society (that would be the true anti-Emersonian approach.)

The Borg-Anarchist continuum:

I should explain what I call the “Borg-Anarchist continuum” for those who are neither Star Trek fans nor wonky. Humans are inescapably both individualistic and social creatures. We know that people get morbidly depressed when they feel they aren’t valued as individuals (Tom Hanks at the beginning of Joe Versus the Volcano), but it’s also true that people go nuts when they are completely isolated from others (Tom Hanks in Castaway.) [Please, don’t draw conclusions about which is “better” on the relative merit of those two movies.] This leads to one of our most fundamental dilemmas. Where our individuality bumps up a social unit, how does one reconcile theses conflicts?

We can imagine a continuum where at one end are the Borg and at the other end are Anarchists. Borg were a powerful enemy in the Star Trek universe. The Borg were a collective in which any given individual was inconsequential and all gave themselves fully to the objective of the collective (i.e. universal domination.) Anarchists are those who feel there should be no authority over the individual. Virtually no one fits into the extreme camps because they’re both blatantly flawed. No one would have any incentive to do anything in Borg world, and an anarchy will inevitably devolve into chaos. No one would invite the Borg or Anarchists to their cocktail party. In practice, one might think of a Communist-Libertarian continuum. Communists believe the state owns the means of production and should be able to regulate ideas as intimately personal as religion, but they don’t attempt to completely stamp out all vestiges of individuality (e.g. people still have names instead of the Borg’s “4 of 7.”) Libertarians believe that authority over the individual should be minimal, but that there’s a role for governance in punishing the illegitimate use of force or the use of fraud.

Yes, I realize that in being one-dimensional, a Republican and a Democrat could occupy the exact same space on the continuum (i.e. wanting the same amount of governance, just not in the exact same domain.)

Is political dysfunction a product of Emersonian thought?:

So, let’s go back to the issue of blaming political dysfunction on Emersonian ideals. It’s my belief that we have political dysfunction because politicians aren’t following Emerson’s advice, rather than that too many are doing so. Let’s consider Anastas’s argument.

“’A man is to carry himself in the presence of all opposition,’ Emerson advises, ‘as if every thing were titular and ephemeral but he.’ If this isn’t the official motto of the 112th Congress of the United States, well, it should be.”

Anastas is saying that the idea that one shouldn’t bend to the ideas of other men, as suggested by Emerson, is the cause of the problem. However, this requires us to believe that politicians engaged in free thinking consistently come down in the perfectly bifurcated set of positions required for grid-lock to take hold on a wide range of issues.  This is dubious. I find it much more probable that politicians do not think freely, but rather they subordinate their opinion to their party and to what the people of their district think. That, my friends, is the source of the problem. Politicians are doing exactly what Anastas wants, which is subordinating their opinion to the majority in their districts. The two-part problem is that: a.) districts are drawn to have clear winners. b.) our society has abandoned the Emersonian idea and taken party and sect as a substitute for thinking. We’ve created a two-party grid-lock machine, and we’re surprised that it works.

Yes, Emerson tells us to be obstinate in holding to ones own beliefs in the face of other people. If every politician did this, our political field would be much richer with many sets of opinions and not just the two captured by the party platforms of the two ruling parties. (At least it wouldn’t hold sway always on anything important.)  What Emerson does not ask of us is to be obstinate in the face of new or better information. Anastas’s own selection of quotes says as much.

“Speak what you think now in hard words,” Emerson exhorted, “and tomorrow speak what tomorrow thinks in hard words again, though it contradict every thing you said today.”

In other words, Emerson is suggesting that one should be able to change one’s mind (one just shouldn’t do this in deference to the views of other people.) One should changes one’s mind when one has new or better information or one’s thinking about the subject is clearer. Changing one’s mind has a bad rap in our political system. There’s a kind of changing of one’s mind that should leave us with a bad taste in our mouths, and that’s pandering. However, not all mind-changing is pandering. If we ask a politician why he changed his mind and he says, “Because I learned X, and that new information made me conclude Y,” then that person should be applauded. The ideas of people of party and sect don’t change regardless of new information. This stagnancy is part of the problem as well. An individual can change his or her mind rapidly but an ideological organization is never swift. When people subordinate their thinking to their sect, this is when we end up unable to get out-of-the-way of slow-moving freight train problems like many that we face today.

The animus that characterizes our political domain is not a function of Emersonian thinking. While Emerson may not address it because it isn’t part of what he’s trying to get across in this essay, it stands to reason that if everyone thinks for themselves people will draw different conclusions. The Maytag repairman is not the loneliest person; the loneliest person in the world is a free-thinker who can’t get along with people who don’t share his exact slate of thinking across a range of  subjects. Thinking for oneself is not only consistent with tolerance, it breeds it. It’s only when one conforms one’s thinking to that of a collective that one can afford to act like people who think differently from one are pure evil.

Other thoughts on the subject:

For another post of mine about Emerson’s Self-Reliance see here.

Also, Emerson was not the only one in the 19th century who was dismayed by the trend toward subordinating political views to party, Mark Twain had a lighter essay on the subject called Corn Pone Opinions.