re: Delhi power supply

[Note: these were posted to the Hasiru Usiru mailing list. It is a follow-up to earlier exchanges on need for privatizing power distribution in Karnataka/Bangalore]

Sorry for the delay in responding. I took some time to get a bit more informed on the subject. I went through the reports by Prayas and also tried to look at what information is available online. It has been interesting & eye-opening. It is a complex issue. There is no silver bullet, including competition/privatization. There are alternatives.

To present the other side of the argument, I've gathered your comments (marked blue) from a couple of unanswered mails & tried to address them in this mail and in subsequent mails over the next few days. Then some general lessons on power sector reforms put forward by people who've looked at this issue closely. I've provided backing external links to mostly everything. Unfortunately some of them are PDF files - can't help that.

I feel this is relevant to HU so am posting on this list too.

To begin with, a comic aside in the Delhi 'privatization' saga, from a July 2009 (i.e., after 7 years of successful "privatization") newspaper article: NDMC power still in sarkari hands:

With performance of the power discoms coming under scrutiny most often from the Government and citizens, Lutyen's zone has been spared the 'erratic' privately managed distribution network that rules other parts of Delhi. The electricity supply in Lutyens' Delhi will remain in sarkari hands.

The Government has turned down the request of private parties seeking distribution of electricity in NDMC area stating that the area is inhabited by the VVIP's and VIP including foreign dignitaries.

Delhi Cabinet on Monday approved a policy direction to Delhi Electricity Regulatory Commission (DERC) for not granting license to private operators for distribution of power in the Lutyens' Delhi area.

Now to some of your points.

Further, apart from Delhi and Mumbai, the cities/ areas that 'enjoy' power supply from private companies are Ahmedabad, Surat, Kolkata, Greater Noida, and in all these places, the customer satisfaction and profitability levels are far higher than elsewhere where the supplies are with government companies/ agencies, all being subject to uniform regulation by the respective SERC's. So, there must be enough merit to it. And, perhaps learning from the experiences in Delhi, the switch-over in other cities can happen more smoothly.

First point, on Delhi as an example of privatization. The distribution companies (discoms) BRPL/BYPL (Reliance), NDPL (Tata) are all joint ventures with the Delhi Government. True, they are run by private players, but the Delhi government has a 49% stake in each of the three companies BRPL/BYPL (Reliance) (see Fresh Equity for Reliance Discoms), NDPL (Tatas) (see NDPL Profile). That is, they get all the upside of being a private company while they also get the backing of the government stake (I'm guessing this will result in eaiser/cheaper financing at the lest). A nice deal for the discoms. And on top of that they are effectively monopolies (discussed below).

Second point - it doesn't make sense to say only one player (Reliance) of the two is bad so it is OK. One player out of two is 50%. And when you support the same player in Mumbai, inconsistencey results. An reasonable way to resolve the inconsistency would be to seriously consider the possibility that the approach taken (in Delhi) may have its limits, based on local contexts etc

Now for list of cities 'enjoy'ing power supply from private players. Just repeating the same thing over and over doesn't make it true. Show me a reliable study that claims that for all the cities & I'll concede the point. Information is available for Delhi. In Delhi, after 5 years of 'privatization', 60% of consumers reported problems as regards load shedding (see page number 4 of this DERC report).

Why wouldn't the consumers complain? Load shedding is happening apace! Look at this document which lays out the scheduled outages from Oct 2009 to Apr 2010 for NDPL: NDPL Load Shedding schedule. However, they mention in that schedule that these will be the likely outages if power shortage occurs. But on their main site (http://www.ndpl.com) they list ongoing maintenance work & resulting outages for the current day and one day before. It is a pretty long list with hours of maintenance at each location (the list of outages for 26th Nov 2009 are attached to this mail)! Maintenance or load shedding – who knows! Loadshedding has apparently been so problematic, that as recently as 10 Nov 2009, DERC has threatened to impose fines for unnecessary loadshedding :DERC decided to fine private discoms for unjustified load-shedding

Of course, following that 60% statistic the DERC document simply asserts that consumers are happier with private supply as compared to earlier times: "However, the Survey found that the consumers preferred the services rendered by the Discoms over those of the erstwhile DESU/DVB." Well, why no % number to that statement? If the % of users saying that was, say, 100% then I'm sure that statistic would have found its way into the report. I'm guessing even if it was 51% it would have. But apparently it didn't, so they've gone ahead and just made up a blanket statement.

As for other cities 'enjoy'ing private supply. In Mumbai, BEST & the Reliance discom are doing well as you point out. Tata Power supplies only to bulk customers. BEST is a public utility. Its distribution losses stood at 10.5% for 2007-08 & 2008-09 (see Final Copy of APR Petition ). I couldn't locate loss numbers for the Reliance discom, but they surely won't be better than BEST's. 10.5% loss percentage is better than Delhi NDPL. Kolkata is left with a monopoly (RPG group) and lots of google'able news reports on issues with load-shedding. This old article in Outlook discusses how unsavoury the privatization itself was and what good terms the RGP group got out of it: High-Powered Immunity . This article from The Telegraph shows how power shortages persist: Ahead: Loo & loadshedding. Torrent Power supplies to Ahmedabad & Surat. It is half the size of BESCOM, supplying 10 billion units anually over an area of 408 sq km (see Torrent website), vs BESCOM's 19 billion units over 41092 Sq. Kms (see BESCOM website). And their users are mainly better paying industrial & commercial units (since Ahmd & Surat are industrial & commercial hubs as they themselves claim on their website).

Also, let us not forget that privatization of the distribution business in Kanpur was unsuccessful (apparently because there were no bidders, see Prayas' Global Reform Overview). Orissa & MP gave up on electricity reforms (see Prayas' Delhi Summary Report.). In Orissa, private discom AES just up & left, leaving it to the Orissa govt to pick up the pieces including a Rs 400 crore due to the Grid Corporation of Orissa (House panel to review Orissa-AES share pact). So at best, experience with reforms/privatization is mixed & heavily local context dependent (something borne out by other observers). Of course, there is international experience too which I'll put up later.

That's true - it's a natural monopoly situation. But, what you do in such situations is to divide the total area into two or three districts/ zones, and allocate it to different players, and the regulator periodically publishes comparisons of their performances based on given parameters. And, that's what Delhi has done. And, with the Reliance's performance showing to be poorer than that of TATAs, there's pressure on them to do better.

That still leaves us with private monopolies, instead of state monopolies. Same seems to be the case in Kolkata (RPG group). For true competition, the end-user should be able to choose his power provider. We are aeons away from that. And in any case, the benefits of open access are themselves not proved & the costs could be prohibitive (more on that in later mails). And when distribution companies integrate generation, market power results.

As for pressure to perform, what does the pressure do? For example, after seven years, the Reliane discoms' T&D losses are at 23% & 27%, for BRPL & BYPL resply (see India Infoline news report ). Those numbers are excluding collection losses I presume, meaning a slightly bigger loss % if that is factored in. It's been seven years and lots of money & effort but BYPL & BRPL (Reliance) haven't been replaced. So when will it change?

Only two companies (namely Reliance & Tatas) submitted bids when distribution was 'privatized' (see Prayas' Delhi Summary Report ), why will the other competitor come in now? Or should their license be canceled & their areas go to Tata's NDPL, making it a total private monopoly instead of a duopoly as of now? Or do we give them 60 years (since we've gone with public utilities for at least that many years after 1947)? And meantime the 'competitors' are competing well, with the Reliance companies allowing NDPL (the Tata discom) to procure short/medium power on their behalf (see DERC report). A bit like Wipro & TCS asking Infosys to do recruitment for them. And they end up purchasing power from a company in which majority stake (76%) is held by a Tata company, Tata Power (this was approved by DERC, see DERC report).

Resulting out of it all, the quality deteriorates, and whereas the rich can then switch to genset, inverter, converter, etc, the poor are left at the mercy of the weather gods. Apart from this is the burgeoning subsidy bill, which ultimately gets passed on to the consumer.

On the other hand, when an Anil Ambani controlled Reliance sends its bills, even Dawood Ibrahim's henchman in Dharawi and Bal Thackeray in Matoshri, better up on time, failing which they will face disconnection as much as any ordinary human being. As a result of it all, power supply is so reliable in Mumbai, that not many people even know what a genset is.

Real life is not so simple. Let hear what the distribution companies (discoms) in Delhi have to say on commercial losses (see DERC Report). In the report, DERC mentions a public hearing involving DERC, discoms, the public, DTL etc, in 2008 (i.e., after 6 years of 'privatization'). From the 2008 DERC annual report (DERC report):

Some of the consumers expressed apprehension on the evaluation of energy losses by the Discoms because the Discoms had neither carried out audit of energy supplied by distribution transformers nor on the corresponding connected consumers. In act, they questioned that as AT & C losses are due to inefficient management of business, the consumers cannot be made to pay for such inefficiencies. They also requested that those areas where the AT & C losses were below 20% should be spared of power cuts.

[Note: No energy audit after 6 years (the commission had to ask them to do energy audit! In response, the discoms listed their achievements, then they had this to say]

the discoms...also expressed the following difficulties in achieving the desired AT & C loss reduction:
i) Effect of socio-political environment and public resistance in certain areas.
ii) Presence of a large number of unauthorised colonies and JJ clusters.
iii) Level of theft in unauthorised areas is high due to limited infrastructure.
iv) Use of domestic connections for industrial purposes.
v) High costs incurred for using technical solutions in rural areas, thus rendering the whole exercise cost ineffective.
vi) Non electrification of unauthorised areas even though residents are willing to pay for electricity, thus, leading residents to use power from neighbouring networks.
vii) Public resistance to the replacement of electro-mechanical meters with electronic meters.

Well, forget Dawood, they are helpless in front of less sinister people! And they have reason to be helpless , they are getting attacked when they go checking theft : Mob Attacks NDPL Enforcement Team. Let's face it - it is a deeper problem, technology and force can only get the discoms so far.

I have shifted the entire debate here. Perhaps it is best furthered there.

Please don't shift the debate to Praja. Please put all the arguments & facts here itself (backed by a working link to the source and also Praja if necessary). Privatization & reforms, especially of essential services, is of relevance to HasiruUsiru. At least, I presume it is. And I really don't feel like sifting through lots of opinions to get to some facts.

I'll address other points raised, in later mails. It is a dry topic but interesting nevertheless.

Regards,
Dinesh.

Three ills

That afflict the country. And the third one is not any less dangerous than the other two:

Red tape tops the list of reasons for this comatose state, and is widely cited. The second reason for this is what only I seem to talk about, and that is a most extraordinary and appalling incompetence. The third is talked about by only those in the know, namely, the influence of business lobbies.
...
Incompetence and corruption have combined to produce the third element, lobby power of big business. Go to any ministry today, even something as noble as the ministry of women and child welfare, and you will see how the lobbies have moved in.

It is they, who along with the think tanks assist the senior bureaucracy in justifying decisions that the Minister wants taken. In far too many instances the staff-work is now done by the lobbies.

We are slowly moving the way of all democracies. Laws get written by lobbies in the US. Even if not, they get neutered by the lobbies who add/delete whatever the concerned industry biggies want. It is going the same way here.

Erasing The Difference

Between itself and the other parties. That is what the BJP has done according to one of its own leaders in the state.

Stating that party workers were of the view that the BJP had ceased to be a party with a difference, he said dynastic rule, casteism and electoral malpractices were the issues with which the Congress and the JD(S) were being targeted. "However, by fielding the kith and kin of sitting ministers, the BJP has lost the moral authority to take on other parties over this issue," he said.

Referring to allegations of the party employing money and liquor to woo voters during elections, Eshwarappa said he would appeal to State President Sadananda Gowda to constitute a committee of senior leaders to look into the charges.

"I am elated that the party won 19 seats in the elections. But, I do believe that means are as important as the ends. More than development and ideological issues, distribution of money and liquor were prominently discussed during elections in Shimoga.

Loyal BJP voters who were not used to this political culture, lost motivation to turn up at polling booths. The party had similar experience in other constituencies also."

I confess I never bought into the 'party with a difference' bs even as far back as 1990. When you haven't tasted power, you tend to be a bit different. After all, power corrupts and absolute power corrupts absolutely etc. But I did think it stood for 'partying with a difference'. With a saffron tinge if one may put it that way. And one did hear about the parties during the Pramod Mahajan days. However, the blatant use of liquor and money in the recent polls as reported in the newspapers did surprise me.

We live and learn.

Movement

The CM visits the Beggars Colony in the city and which ultimately results in headline from DH:

Plight of beggars in colony moves CM

So one expects a lot of sympathy and a firm commitment to help improve the plight of the people in the colony. Instead one realises that the CM was so moved that all he could think of was to move the colony to some other, "better", place:

The government is now contemplating to shift the Colony to a new location, a better place. The Chief Minister has now proposed to shift the Beggars’ Colony and establish a ‘Mini-Lalbagh’ along with a government hospital on a five acre land in the location.

“Being in the centre of the City and worth around Rs 1,000 crore, the land can be used for various purposes. This would be decided in the next Cabinet meeting,” he said.

Land worth Rs 1000 crores! The possibilities are endless and the imagination goes wild. Will be interesting to see how and to whom they sell it off.

America: Where Even The Prostitution Is Better

From the NY Times:

Prostitution in America isn’t as brutal as it is in, say, India, Nepal, Pakistan, Cambodia and Malaysia (where young girls are routinely kidnapped, imprisoned and tortured by brothel owners, occasionally even killed).

But the only problem is, it isn't!

“If you don’t earn enough money, you get beat,” said Jasmine, an African-American who has turned her life around with the help of Covenant House, an organization that works with children on the street. “If you say something you’re not supposed to, you get beat. If you stay too long with a customer, you get beat. And if you try to leave the pimp, you get beat.”

The Nuclear Deal

And all that it was to do for the Indo-US partnership are in reality far from the touted ideal. Who could have known!

The United States-India nuclear deal was promoted as a transformative initiative — one that would put the bilateral relationship on a much-higher pedestal. In his valedictory speech, President George W. Bush declared: “We opened a new historic and strategic partnership with India.” By contrast, Prime Minister Manmohan Singh has not made a single statement on the deal — not even to Parliament — ever since the vaunted deal came to fruition, othe r than to admit recently that he got his party to back the deal by threatening to resign.
...
Seven months after the deal’s realisation, there is no sign of its transformative power. Rather, doubts have arisen over the supposed “global strategic partnership” with America. The policy frame in which Washington is viewing India is not the larger Asian geopolitical landscape, but the southern Asian context. But even on regional matters of vital interest to India, the U.S. has sought to ignore New Delhi or pursue antithetical policy approaches. To the chagrin of Indian neocons — who ingenuously marketed the nuclear deal as a U.S. move to build India as a world power and counterweight to China — Washington has declared that its “most important bilateral relationship in the world” is with Beijing.

Link.

The Class Dialectic

Class:

Declasse:

It's Official, The Banks Own the US Government

DURBIN: And the banks -- hard to believe in a time when we're facing a banking crisis that many of the banks created -- are still the most powerful lobby on Capitol Hill. And they frankly own the place.

And that's a serving Senator speaking, no conspiracy theorist. Link.

Update: And the Vice-Chairman of Berkshire Hathaway thinks so too:

May 2 (Bloomberg) -- Berkshire Hathaway Inc. Vice Chairman Charles Munger, whose company is the largest private shareholder in Goldman Sachs Group Inc. and Wells Fargo & Co., said banks will use their “enormous political power” to prevent changes to the industry that would benefit society.

“This is an enormously influential group of people, and 90 percent of that influence is being spent to gain powers and practices that the world would be better off without,” Munger, 85, said yesterday in an interview with Bloomberg Television. “It will be very hard to accomplish the kind of surgery that would be desirable for the wider civilization.”

...

Munger said the financial companies spent $500 million on political contributions and lobbying efforts over the last decade. They have a “vested interest” in protecting the system as it exists because of the high levels of pay they were earning, he said. The five biggest U.S. securities firms, only two of which still exist as independent companies, paid their employees about $39 billion in bonuses in 2007.

Our Media

From The Hindu:

Over the last few months, just as the economy entered its current recessionary phase, the mainstream media, which till then had been uniformly unswerving in their antipathy to NREGA (National Rural Employment Guarantee Act), suddenly began to sing its praises.

Because rural people don't really matter till they are required to bail out the economy!

Talking Movies (Not Really)

It may seem tame considering what has come since, but Henry Levin's 1960 teen romantic comedy Where the Boys Are was fairly revolutionary for its time.

... the movie tells the tale of two college co-eds, Merritt (Dolores Hart) and Melanie (Yvette Mimieux) on spring break in Fort Lauderdale, Florida. Merritt hesitates on taking the penultimate step in the game of what she calls "backseat bingo" in order to win the heart of a special beau; Melanie fairly explicitly affirms (for the time, anyway) that she intends to show no such restraint.

Of course, it ends very badly for Melanie. Lured to a party at aroadside motel where she believes that her new boyfriend will be present along with other desirable young Ivy League "Yalies", she is next seen wandering aimlessly in the middle of a busy highway, hair and clothes disheveled - as the then movie morals code would not allow the word that described her obvious violation to be explicitly uttered, the audience was left to draw the obvious inference as to the terrible price she paid for her licentiousness.

She gets hit by a car; in the hospital, she confesses the worst part of her sin to Merritt. "They weren't even Yalies!" she sobs.

But it is not really about the movie.

Thirty eight years later, in 1998, US Commodity Futures Trading Commission chairwoman Brooksley Born, in seeking to uphold the integrity of the financial system, was similarly accosted. However, in contrast to poor Melanie, the gang that attacked her possessed just about the highest imaginable academic pedigrees. They were the then deputy secretary of the Treasury (and now the chair of President Barack Obama's National Economic Council) Laurence Summers (BA Massachusetts Institute of Technology, Phd Harvard); Federal Reserve Board chairman Alan Greenspan (BA, MA Columbia, Phd New York University); and the leader of the gang, Treasury secretary Robert Rubin (BA Harvard, LLB Yale - yes! he was even a Yalie). After the attack on chairwoman Born, the gang carelessly hopped into their souped-up hot rod and proceeded to further make the preparations for their rich-kid, thrill-kill firebombing of the world financial system we see occurring today.

Lessons From The Crisis

One interesting thing about the global screw-up is that one sees how things work more clearly. One sees what clothes the various emperors are wearing, with the help of people in the know. Like former IMF chief economists.

The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time.

Oligarchy

When will the revolution happen here? Or has it already occurred and we don't even know about it?

The reality is that the worldwide economic meltdown and the bailout that followed were together a kind of revolution, a coup d'état. They cemented and formalized a political trend that has been snowballing for decades: the gradual takeover of the government by a small class of connected insiders, who used money to control elections, buy influence and systematically weaken financial regulations.

Link.

Cloning Mr Reddy. a.k.a. The West Knows Best!

From The Business Line:

For adhering to the general view more staunchly than was expected by a mere governor of a central bank, the Reserve Bank of India and its then Governor, Dr Y. V. Reddy, drew enormous flak. Such was the bad blood that was created — largely by hired guns — that even his deputy governor, Dr Rakesh Mohan, was not spared. In the end, the campaign came in the way of his becoming Governor.
He was, it is reliably learnt, seen as being a “Reddy clone”. Ironically, today, every central banker in the world is dying to be labelled a “Reddy clone.”

And these are relevant questions too:

Why is it that if India has an approach to something, Indian economists wait for it to be validated by the West before they accept it? Indeed, why do they attack the Indians who advocate that view before such validation is bestowed by the West? I genuinely believe that the Finance Ministry, which funded the Mistry report, and the Planning Commission, which funded the Raghuram Rajan report, have some serious explaining to do. As indeed do the economists who toed their line and kept up LeT like attacks on the RBI.

Could it be because we have our own share of maroons, blowhards, people with hidden agendas, and people talking their books? Or is it just that we believe the west knows best?

Corruption

From FT:

There was a steady erosion in business ethics and moral standards in commerce and trade. Regulatory capture and corruption, from petty corruption to grand corruption to state capture, became common place. Truth-telling and trust became increasingly scarce commodities in politics and in business life. The choice between telling the truth (the whole truth and nothing but the truth) and telling a deliberate lie or half-truth became a tactical option. Combined with increasing myopia, this meant that even reputational considerations no longer acted as a constraint on deliberate deception and the use of lies as a policy instrument.

Regulatory Capture is defined as:

... situations in which a government regulatory agency created to act in the public interest instead acts in favor of the commercial or special interests that dominate in the industry or sector it is charged with regulating.

State Capture is defined as:

State capture is the phenomenon in which outside interests (often the private sector, mafia networks, etc.) are able to bend state laws, policies and regulations to their (mainly financial) benefit through corrupt transactions with public officers and politicans. The notion of state capture deviates from traditional concepts of corruption, in which a bureaucrat might extort bribes from powerless individuals or companies or politicians themselves steal state assets (see kleptocracy). State capture is recognised as a most destructive and intractable corruption problem, above all in transition economies with incomplete or distorted processes of democratic consolidation and insecure property rights.

We're not talking about transition economics though. We're talking about the US & UK - submerging economies. So it is only to be expected that it would be called something else, rather than just 'corruption'.

'Slumdogs and Negative Lists'

Ramesh Ramanathan from livemint:

As the film Slumdog Millionaire graphically depicts in an early scene, the plight of the urban poor can be sickeningly sad. Unfortunately, policymakers believe that the challenges of poverty are still in rural India, and the market finds urban India’s burgeoning middle class too attractive to pay attention to the urban poor.

I want to focus on a practice in the banking industry—relatively unknown outside the sector—that I believe can cause enormous damage to the lives of the urban poor: negative lists in credit appraisals. A negative list is a list of areas of a city that a bank has identified where residents would not qualify for credit approval, just by virtue of the location.

This is a relatively new development in India. Historically, banks relied on customer relationships and on-the-ground assessments by local staff to make credit decisions. However, a more rule-based approach to the credit approval process, de-emphasizing individual judgement and focusing on credit scores is now being practised, led apparently by some foreign banks and private sector banks (and possibly some public sector banks as well). Such a process can—while delivering many risk management benefits and scale economies—create an insidious form of systemic discrimination against the poor.

The data on negative lists is very hard to come by, given that much of this is proprietary within each bank, and no formal paper trail can really be established. However, the urban microfinance organization that I am involved with has stitched together some sketchy information for Bangalore, and the results are troubling:


*
There are a total of 153 negative list areas, spread across 43 pin codes accounting for about 40% of the total pin codes in the city.
*
These are common to many banks since they use common local agents.
*
A qualitative analysis of the negative list areas indicates high overlap with the low-income and slum areas of the city.
*
Factors that apparently go into the definition of the negative list include crime statistics.

To put it bluntly, negative lists are discriminatory. Consider the implications.

Lack of access to formal credit can have damaging consequences—on a personal level, it can drive people into debt traps from informal sources who can charge interest rates up to 10% a day. On a larger level, though, the consequences are even more destructive. As formal funds get sucked out of these areas, commerce gets bogged down, the entire neighbourhood deteriorates, driving a downward spiral of economic decay where the whole community—residents, traders, labourers— become dependent on an informal ecosystem of financial support to keep them afloat. This is the breeding ground for the mafia and criminal networks.

I’m not trying to sensationalize the problem. The US had a practice similar to our negative lists, called “redlining”, where areas of a city that were poor or dominated by blacks were credit-quarantined. Consider this quote from a book titled When Work Disappears—The World of the New Urban Poor by William Julius Wilson, professor of social policy at Harvard, “Redlining paralysed the housing market, lowered property values and further encouraged landlord abandonment. Abandoned buildings would serve as havens for drug dealing and other illegal activity.”

I don’t believe there is a sinister motive behind negative lists—just a natural evolution of seemingly logical business rules to ensure a systems-based process for low-risk credit growth in banks. This is especially true given that we don’t have reliable information on individuals, and credit history data is just beginning to get systematically compiled and shared. Unfortunately, we don’t always understand the downstream consequences of our actions.

Given the seriousness of the negative list issue, it needs to be stopped. This is not going to happen with corrective action from market forces—it will require policymakers to enact legislation to set the right framework, and then enormous patience, persistence and creativity to ensure compliance.

A bit of comparative history is useful. When the redlining practice in the US became public in the 1960s, there was enormous pressure for several years to get corrective policies. The Fair Housing Act of 1968 and the Community Reinvestment Act of 1977 were seminal pieces of legislation that addressed redlining discrimination.

We need to initiate a similar process here in India. First of all, RBI needs to formally confirm the existence of the practice of negative lists. The onus is then on RBI and the ministry of finance to establish the necessary regulatory checks to protect against this.

Discriminating on the basis of location means not giving people an equal shot at improving their lives. In this sense, these people are doubly damned: first by their birth into a poor household— what Warren Buffett evocatively calls the “ovarian lottery”—and second, by our systematic biases in denying opportunities to them. If India is to be a country where we want to embrace the power of the market, we need to ensure that the rules of the game are fair: that is, everyone gets equal opportunity to fulfil their full economic potential.

Udayan Asks For $10 Bn

He wants the government to spare this amount and buy up what the FIIs are selling. Let's see. The government buys up all those shares in all those private firms. I'm guessing that it then becomes a major shareholder in said firms. So, it can decide what they should do and not do. Like keeping cement prices low.

I say, just do it.

Free Markets 0, Greenspan 0

...in a tense exchange with Representative Henry A. Waxman, the California Democrat who is chairman of the committee, Mr. Greenspan conceded a more serious flaw in his own philosophy that unfettered free markets sit at the root of a superior economy.

“I made a mistake in presuming that the self-interests of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders and their equity in the firms,” Mr. Greenspan said.

Referring to his free-market ideology, Mr. Greenspan added: “I have found a flaw. I don’t know how significant or permanent it is. But I have been very distressed by that fact.”

Mr. Waxman pressed the former Fed chair to clarify his words. “In other words, you found that your view of the world, your ideology, was not right, it was not working,” Mr. Waxman said.

“Absolutely, precisely,” Mr. Greenspan replied. “You know, that’s precisely the reason I was shocked, because I have been going for 40 years or more with very considerable evidence that it was working exceptionally well.”

OK, that's that then.

Welcome To The USSRA!

Man is this guy angry! Nouriel Roubini (who's he, eh? Let's just say, The Man Who Saw The Future, or since we are already in it, The Man Who Saw The Present Before Almost Anyone Else. More info here, and here, and indeed here):

For the last twenty years after the collapse of the USSR, the fall of the Iron Curtain and the economic reforms in China and other emerging market economies the world economy has moved away from state ownership of the economy and towards privatization of previously stated owned enterprises. This trend was aggressively supported the United States that preached right and left the benefits of free markets and free private enterprise.

Today instead the US has performed the greatest nationalization in the history of humanity. By nationalizing Fannie and Freddie the US has increased its public assets by almost $6 trillion and has increased its public debt/liabilities by another $6 trillion. The US has also turned itself into the largest government-owned hedge fund in the world: by injecting a likely $200 billion of capital into Fannie and Freddie and taking on almost $6 trillion of liabilities of such GSEs the US has also undertaken the biggest and most levered LBO (“leveraged buy-out”) in human history that has a debt to equity ratio of 30 ($6,000 billion of debt against $200 billion of equity).

So now Comrades Bush, Paulson and Bernanke (as originally nicknamed by Willem Buiter) have now turned the USA into the USSRA (the United Socialist State Republic of America). Socialism is indeed alive and well in America; but this is socialism for the rich, the well connected and Wall Street. A socialism where profits are privatized and losses are socialized with the US tax-payer being charged the bill of $300 billion.

Read it all.

Convincing The Great Unwashed

And how the US government does it. From the New York Times.

In the summer of 2005, the Bush administration confronted a fresh wave of criticism over Guantánamo Bay. The detention center had just been branded “the gulag of our times” by Amnesty International, there were new allegations of abuse from United Nations human rights experts and calls were mounting for its closure.

To the public, these men are members of a familiar fraternity, presented tens of thousands of times on television and radio as “military analysts” whose long service has equipped them to give authoritative and unfettered judgments about the most pressing issues of the post-Sept. 11 world.

Hidden behind that appearance of objectivity, though, is a Pentagon information apparatus that has used those analysts in a campaign to generate favorable news coverage of the administration’s wartime performance, an examination by The New York Times has found.

The effort, which began with the buildup to the Iraq war and continues to this day, has sought to exploit ideological and military allegiances, and also a powerful financial dynamic: Most of the analysts have ties to military contractors vested in the very war policies they are asked to assess on air.

Those business relationships are hardly ever disclosed to the viewers, and sometimes not even to the networks themselves. But collectively, the men on the plane and several dozen other military analysts represent more than 150 military contractors either as lobbyists, senior executives, board members or consultants. The companies include defense heavyweights, but also scores of smaller companies, all part of a vast assemblage of contractors scrambling for hundreds of billions in military business generated by the administration’s war on terror. It is a furious competition, one in which inside information and easy access to senior officials are highly prized.

Yawn. So who didn't know that?

A Nation Of Hypocrites

Ramesh Ramanathan writing in Mint (no link):

A Nation of Hypocrites

I read a news report a few weeks ago of a terrible incident that took place in Delhi: a 12-year old boy whose bicycle was damaged by a car that was part of a wedding reception.  When he asked for compensation so that he could repair his cycle, the people in the party took offence, beat him up and burned him to death in a nearby field.  The story was buried in the regional pages, and generated hardly any public outcry.

A few days later, there was a story of a 2-year old child who had been trapped in a borewell – a common occurrence across the country.  Incidents like these capture the public imagination, and the media obligingly provides a minute-by-minute report of the rescue efforts.

I wondered at these two occurences and reached an uncomfortable conclusion.  We Indians are a nation of hypocrites.  Our inconsistencies are not always in such stark and horrific terms, but in thousands of other ways, small and big.

Let me begin with a list of my own inconsistencies: I got my MBA from a prestigious American University, whose founder made his money by profiting from India's colonisation.  I fly business class, even though I profess to work on issues concering the urban poor.  I guiltily let the water run when I shave because I find the sound of running water comforting – small trickle, but still.  I talk about power sharing in the work that I do, but at home, I struggle to share power with my children.

There are more examples, but this isn't a therapy session.  The point is that I don't want to sound like a sermonising moral high-grounder; I just want to talk frankly about the challenges we have as Indians. Hypocrisy is a big issue in most societies, but it's a particularly problematic one in India.  We believe that "mamatha" - a mother's affection - is a sacred emotion, and yet unflinchingly inflict horrors upon our women.  We take bribes, and then hope to wash away our sins by thrusting thousands down the slit-eyed hundis of our temples.  We speak of compassion, but show little for the household help who toil away in our homes.  We study "moral science" in our schools – whoever coined that phrase – and are tested to see if we got the spelling right when we have the essence wrong. 

We learn about civics and citizenship, and yet are often asked – and ask ourselves – why we have such a strong sense of family, but such a poor sense of a larger community: how can our homes be so clean, and our streets so littered with garbage?  Clearly, I am generalising here - there are thousands of Indians who would justifiably take offense at being called hypocrites, and for good reason.  But they are a minority in today's India.

Every day, in every sphere – business, politics, social work or sports - across the length and breadth of this country, millions of Indians indulge in acts of hypocrisy that collectively add up to an epidemic.

And yet, it seems that there was some noble past, a link between thought and action, where values were cherished.  The signs are there: in the sublime music, in our dance forms, in the incredibly sophisticated material about human spirituality, and so on.  So how can a country with so much collective wisdom and spirituality be broken in so apparent a fashion?

It feels that we got massively unhinged somewhere along the way.   What is left today is only a frustrating graffitti of greatness: each artefact by itself a tantalising glimpse into a life that was, but somehow dismembered, leaving more questions than answers. 

We have lost a sense of individual agency in our thoughts and actions.  Like children of over-achieving parents, we seem overwhelmed by the legacy of great ideas in our society.  It's almost like we need to exfoliate these oppressive layers of crusted wisdom that have settled upon our consciousness, and discover our own morality for ourselves.  To see the relationship between values, thoughts and actions, and agitate over the inconsistencies that we see in ourselves. To acknowledge that words like "honesty" and "caring" and "respect" are most powerful when displayed in action, not recited by rote.

Getting rid of these layers takes an enormous amount of introspection, a ruthless sense of honesty, and the courage to act upon the schisms when we encounter them.  These will be painful.  But if we had the perspective to consider our actions, and the courage to correct ourselves, we could rekindle the greatness that our society seems to have once had.  And maybe rediscover our moral compass, one person at a time.

Systemic Banking Crisis In The US?

(via CalculatedRisk): All claws, teeth, and fur (head out to the last paragraph of the PDF)

What will be the consequence of losses of over $1 trillion and, possibly, as high as $2 trillion? That would wipe out most of the capital of most of the US banking system and lead most of US banks and mortgage lenders – that are massively exposed to real estate – to go belly up. You would then have a systemic banking crisis of proportions that would be several orders of magnitude larger than the S&L crisis, a crisis that ended up with a fiscal bailout cost of over $120 billion dollars. And the worrisome part of this scenario is that – with home prices likely to fall by 20% or more – this scenario of systemic banking crisis is becoming increasingly likely.

What impact would that have on Udayan's long bull run?

Drug Companies Rigging The Markets?

From The Hindu:

...the real story goes way beyond the question of Prozac. This new study — published, paradoxically, in an open-access journal — tells a fascinating story of buried data and of our collective failure, as a society, over half a century, to adequately regulate the colossal global $550b pharmaceutical industry.

The key issue is simple. In any situation, to make any kind of sensible decision about which treatment is best, a doctor must be able to take into account all of the available information. But drug companies have repeatedly been shown to bury unflattering data.

Sometimes they bury data that shows drugs to be actively harmful. This happened in the case of Vioxx and heart attacks, and SSRIs and suicidal thoughts. Such stories feel, intuitively, like cover-ups. But there are also more subtle issues at stake in the burying of results showing minimal efficacy, and these have only been revealed through the investigative work of medical academics.

One example came just last month (January). As I reported at the time, a paper in the New England Journal of Medicine dug out a list of all trials on SSRIs that had ever been registered with the U.S. Food and Drug Administration, and then went to look for those same trials in the academic literature. There were 37 studies which were assessed by the FDA as positive and, with a single exception, every one of those positive trials was written up, proudly, and published in full. But there were also 33 studies which had negative or iffy results and, of those, 22 were simply not published at all — they were buried — while 11 were written up and published in a way that portrayed them as having a positive outcome.

But I thought the markets were sifting the wheat from the chaff, rewarding the good companies and punishing the bad. But what do I know.

Pesky Questions

From The Hindu:

The Americans hate to admit that they were wrong - nobody does, for that matter. But few have taken so many undemocratic and illegal actions in world policy as they have. In the United States, those guilty of such actions may face life imprisonment, if not a lethal injection, electrocution or gas chamber (how can democracy be preached by a country where 35 states allow capital punishment by such revolting methods?). Erosion of international law started with Serbia - the bombing of Belgrade in 1999. Iraq followed.

Robbery and murder

In terms of criminal law, these global actions qualify as robbery and murder. In Arkansas and Texas, these crimes are punishable by death penalty. These are home states of the last two Presidents that started wars in Yugoslavia and Iraq in violation of international law. But at home, U.S. Presidents do not behave like this - they are decent gentlemen playing the sax and riding a bike. But once they go outside, everyone had better scatter.

The last two Presidents liked to talk about the U.S. mission before the start of a war: "The United States is called upon to guarantee...." Depending on the situation, they would continue with such phrases as "Kosovo's freedom," "peace and prosperity," or "democracy all over the world." None of them has specified who imbued the United States with this mission and what rights they had for that.

But these are details that ordinary Americans should not go into until someone in their family is killed in action. For the time being, Americans are not dying in Kosovo like they do in Iraq; and for this reason they don't ask who has urged America to help the Kosovars and whether the Kosovars had the right to do so.

Have the Kosovars appealed to the Americans? What if the Basques, Catalans, or Corsicans appeal to them? Quebec has a hard life as part of Canada, and is closer to the United States. Does the United States want to help the Turkish Kurds? Probably not, separatism is a bad word in Turkey.

Making Up For The Missing Posts

Was unable to post for some days due to various reasons. I'm back and hope to be more regular - 'hope' is the the keyword. Anyway, wanted to highlight some stories that I did not post about but wanted to.

This killing comment from The Hindu's editor about the Kosovo seccession and Bush's comment on it was priceless:

Kosovo’s unilateral declaration of independence has thrown the fragile Balkan peace into question again and caused much disquiet elsewhere in the world. The reactions of other states will be crucial. U.S. President George W Bush, with his characteristic grasp of international affairs, initially said: “The Kosovoans are now independent”;

Then there was the Rice testimony on the nuclear deal to the US Congress which justifies one of the criticisms put forward by the Left against the deal:

Washington: The Bush administration has said an agreement between India and the Nuclear Suppliers Group which will allow New Delhi to engage in nuclear trade will be supported by the U.S. only if it is “consistent” with the Hyde Act.
“We will support nothing with India in the NSG that is in contradiction to the Hyde Act. It will have to be completely consistent with the obligations of the Hyde Act,” Secretary of State Condoleezza Rice told the House Foreign Affairs Panel.
Ms. Rice said if the Bush administration did not adhere to the Hyde Act — which, according to opposition parties in India, takes away the country’s nuclear sovereignty — U.S. lawmakers will eventually refuse to pass the India-U.S. civilian nuclear deal if and when it comes up in the Congress.
“We’ll have to be consistent with the Hyde Act or I don’t believe we can count on the Congress to make the next step,” Ms. Rice said in response to a query from the Chairman of the panel, Howard Berman.

Another thing, that was actually good to see, was the Congress giving back to the BJP on the issue of terrorism, over two days. Here and here. That's right - say it loudly and clearly and very publicly. After all, the last thing we need is another right-wing party coming to power on the basis of being 'strong' on terror.

Another story which I saw on cnet.com reinforces that the Internet has made so many things possible. And a lot of them are a force for the good. Like exposing Swiss Banks that apparently help launder money among other shady activities:

A federal judge in California has pulled the plug on Wikileaks.org, a Web site that specializes in posting leaked documents often provided by whistleblowers.
U.S. District Judge Jeffrey White on Friday ordered that the domain name be disabled at the behest of a group of Swiss bankers who filed a lawsuit alleging that confidential information appeared on Wikileaks.org.
... Wikileaks' summary of the leaked documents centers on Rudolf Elmer, the former chief operating officer of Bank Julius Baer in the Cayman Islands. The summary alleges the bank supports "ultra-rich's (sic) offshore tax avoidance, tax evasion, asset hiding and money laundering." The bank has refused to comment.

Privatise Profits, Socialise Losses

From Calculated Risk:

Over the last two decades, few industries have lobbied more ferociously or effectively than banks to get the government out of its business and to obtain freer rein for “financial innovation.”

But as losses from bad mortgages and mortgage-backed securities climb past $200 billion, talk among banking executives for an epic government rescue plan is suddenly coming into fashion.

A confidential proposal that Bank of America circulated to members of Congress this month provides a stunning glimpse of how quickly the industry has reversed its laissez-faire disdain for second-guessing by the government — now that it is in trouble.

The line from the title is borrowed from countless commenters on the above blog and many other blogs. Says it well.
Another instance of the same, here.

American Primaries : Democracy In Action Or...

Ramesh Thakur in The Hindu:

... let us pay homage to America and the American dream more generally. Later this year, the Democratic Party will have either a black or a woman as its presidential standard bearer. The party’s field of candidates is already America at its most glorious best: Barack Obama, son of a white Christian woman from Kansas and a black Muslim father from Kenya who grew up in Hawaii and Indonesia, victorious in 96 per cent white Iowa; Hillary Clinton, a woman; and Bill Richardson, a Hispanic-American, among others.

America matters, what America does and does not do matters, and so the choice of who leads America matters to the rest of us. ... it is impossible for outsiders not to celebrate when America presents its most attractive face to the world which no other country, still, can match.

After that rhapsody he has gone on to endorse Mr Obama:

“A president like my father,” Caroline Kennedy wrote that in Mr. Obama she saw an echo of the force of inspiration that people told her they had felt with her father but she herself had never experienced. She was supporting Mr. Obama for a mix of “patriotic, political and personal” reasons that are intertwined. Touchingly, it was her children who first made her realise that Mr. Obama “is the president we need”.
...
Mr. Obama’s victory speech was another rousing oration that dipped deep into the wellsprings of hope, optimism and unity. There were also flashes of hard-edged anger, condemning those who will say and do anything to win, denouncing those who are so partisan that they will demonise any crediting of ideas to a Republican, and rejecting all attempts to file candidates and voters into ethnic and gender boxes.

But he has completely skipped over Mr Edwards - "the most progressive candidate on issues and the most electable on paper" - ignored him, made him invisible - as the American media has. And there in lies the real story of the American system - media and big-money dictates who gets a chance and who doesn't.

Paul Krugman on Edwards contribution to the race:

So John Edwards has dropped out of the race for the presidency. By normal political standards, his campaign fell short.

But Mr. Edwards, far more than is usual in modern politics, ran a campaign based on ideas. And even as his personal quest for the White House faltered, his ideas triumphed: both candidates left standing are, to a large extent, running on the platform Mr. Edwards built.

If 2008 is different, it will be largely thanks to Mr. Edwards. He made a habit of introducing bold policy proposals — and they were met with such enthusiasm among Democrats that his rivals were more or less forced to follow suit.

Unfortunately for Mr. Edwards, the willingness of his rivals to emulate his policy proposals made it hard for him to differentiate himself as a candidate; meanwhile, those rivals had far larger financial resources and received vastly more media attention. Even The Times’s own public editor chided the paper for giving Mr. Edwards so little coverage.

Eric Alterman on how the media marginalised Edwards :

The Edwards campaign was a surreal experience that should inspire a doctoral dissertation or two. He was both the most progressive candidate on issues and the most electable on paper, and yet he did not get the support of most progressives or most professionals. This despite the fact that he actually ran a terrific campaign and, more than Obama and Hillary, defined it in a positive direction. That he forced the other candidates to respond did not end up mattering as much as the media’s fascination with all things Clintonian, Obamian, and the egregiously awful coverage of Edwards. The Washington Post deserves special mention for its idiotic 1,300-word piece on his haircut and an even longer one on his house. Richard Cohen and Michael Dobbs both called him a liar and presented no evidence. The editorial board attacked him constantly. The New York Times also went in for the “How can you care about poor people when you’re so rich?” line of questioning, which implies that poor people are unentitled to representation in the American political system, since it allows for only wealthy people to run. And Maureen Dowd was her usual awful, substanceless self, helping to set the tone for the rest, to the shame of all of us.

More from :

The 28% of the American adult population with college degrees defines the country's values, its policies, its laws, what is stylish and how you get to the top, including the White House. And what it has defined has exacted no small price from the remaining 72%. For example, just in the past eight years, the following have gotten significantly worse:

Median income
Number of manufacturing jobs
Number of new private jobs
Percent of workers with company based health insurance
Poverty
Consumer credit debt
Number of housing foreclosures
Cost of heating oil & gas
Number without health insurance
Wages in manufacturing
Income gap between rich and poor
Wealth of the bottom 40% of Americans
Number of older families with pensions
Number of workers covered by defined benefit pensions
Hunger
Use of soup kitchens
Personal bankruptcies
Median rent

Yet when John Edwards tried to build a campaign around these issues he was subjected not only to the opposition of the establishment and its media but a notable tone of ridicule whose subtext was: why would anyone want to bother with such things? Especially a guy as rich as Edwards?

And when he pulled out of the race, Edwards was treated to more of the same, especially from such faux hip websites as Gawker, Radar and Fark:

Radar: The pretty-boy presidential candidate scored just 14 percent of the vote in yesterday's Florida primaries. . .

Fark: John Edwards announces he will drop out of race today to spend more time with his hair.

Gawker: John Edwards will end his 49th run for president Wednesday after failing to capitalize on his angry hobo-under-the-bridge message.

These sites, like much of elite America, are led by spoiled offspring of generations who had to struggle with just the sort of issues Edwards was trying to raise, but from which they now consider themselves immune by their education, status and cleverness.
...

Edwards' problem was that he made the smug set of American liberalism extremely uncomfortable. He showed them what they should really be thinking about and what they might do about it. And they didn't like it. Far better to relax in the self-righteousness of choosing between a Harvard Law School black and a Yale Law School woman.

And so, once again, the Democratic Party drifts further away from what once made it worth bragging about.

One of the comments to the above post:

Both Obama and Clinton have elite megabucks backing them. The Kerry and Kennedy endorsement of Obama represent billions in famlity net worth, in addition to the billions - for example, from the heiress to the Hyatt Hotel fortune, Karen Pritzker - already backing him. There is, to my thinking, no "democracy" in this "Democratic" party two-fold choice.

So that is what is happening in the American primary contest.

Spreading Democracy

Via Digby:

An Iraqi MP preferred to remain anonymous told the newspaper that highly confidential negotiations took place by representatives from American oil companies, offering $5 million to each MP who votes in favor of the Oil and Gas law.

The amount that could be paid to pass the votes do not exceed $150 million dollars in the case of $5 million to each MP, pointing out that the Oil law requires 138 votes to pass, which the Americans want to guarantee in many ways, including vote-buying, intimidation and threats!

Says Who?

From TOI (epaper link, the article is on page 10):

Correcting his father’s scandalous assessment made when he was prime minister that of every rupee spent on rural uplift and poverty alleviation only 16 paise reached the target recipients, Rahul Gandhi recently scaled that figure down to between five and six paise. A report has shown that the much-hyped rural employment guarantee scheme has managed to reach less than 4% of the households it is aimed at.

'A report'? Which report would that be? Small-sized sound bites like this, without any backing up from authoritative sources, chip away steadily at creditable government actions like the NREGA.

Brain Dead Cartoon

From TOI:



Update: Adding that ad hominem attacks don't cut it, and nor does deliberately missing the main point. Like those in this counter view. The main point is that kids and youngsters are the ones at most risk - not those who have minds of their own. True, there are other problems with health care, but accept it, this is also a biggish problem.

We Learn

At least, that's the message I take away from this news:

Hopes revive on pipeline deal

Sujay Mehdudia

NEW DELHI: In a major initiative that could culminate in the clinching of the 2,300 km. trans-border Iran-Pakistan-India gas pipeline, Union Petroleum and Natural Gas Minister Murli Deora is likely to visit Pakistan in February first week to sort out issues relating to the transit fee.

Highly placed sources on Tuesday said Pakistan’s Minister for Petroleum and Natural Resources Amanullah Khan Jadoon invited Mr. Deora to pay a visit for sorting out issues pertaining to the project during their meeting in London late last week.

The Pakistan Minister told Mr. Deora that Islamabad was ready for talks some time in the first week of February. Both discussed the possibility of settling the transit fee issue and also the price revision clause sought to be introduced in the contract by Iran.

In a related development, Iran has suggested February 12 or 13 as dates for holding talks with India and Pakistan in Tehran to settle the $7 billion deal.

The U.S. is pressuring India not to go ahead with the project.

Two Worlds

From Churumuri:

“Ironically, the era of the free market has led to the most successful secessionist struggle ever waged in India—the secession of the middle and upper classes to a country of their own, somewhere up in the stratosphere where they merge with the rest of the world’s elite. This Kingdom in the Sky is a complete universe in itself, hermetically sealed from the rest of India.

“It has its own newspapers, films, television programmes, morality plays, transport systems, malls and intellectuals. And in case you are beginning to think it’s all joy-joy, you’re wrong.

“It also has its own tragedies, its own environmental issues (parking problems, urban air pollution); its own class struggles. An organisation called Youth for Equality, for example, has taken up the issue of Reservations, because it feels upper castes are discriminated against by India’s pulverised lower castes.

“It has its own people’s movements and candle-light vigils (Justice for Jessica, the model who was shot in a bar) and even its own People’s Car (the Wagon for the Volks launched by the Tata Group recently). It even has its own dreams that take the form of TV advertisements in which Indian CEOs (smeared with Fair & Lovely Face Cream, Men’s) buy over international corporations, including an imaginary East India Company.

“They are ushered into their plush new offices by fawning white women (who look as though they’re longing to be laid, the final prize of conquest) and applauding white men, ready to make way for the new kings. Meanwhile, the crowd in the stadium roars to its feet (with credit cards in its pockets) chanting ‘India! India!’”

That's Arundhati Roy describing one of the two worlds. Here's The Hindu (30 Jan 2008) describing part of the other (the entire page is missing from the online edition, so no link):

Cholera seems to have revisited the city with detection of five cases in a private hospital and 24 samples suspected for cholera sent to Public Health Institute (PHI) for confirmation. On Tuesday, 281 fresh cases of gastroenteritis were also reported, taking the total to 819 since the first case was reported in Bharathinagar on Sunday.
...
The BWSSB (Bangalore Water Supply & Seweraage Board) release said: "Some contamination has been detected from 15 houses on Thimmaiah Road Cross. These houses had directly taken water supply connections from the public tap through a GI pipe across a manhole filled with sewage. The water supply to these households was contaminated as the GI pipe was corroded."
...
In many populated areas where roads are very narrow, sewage lines and drinking water pipelines have been laid side by side, which could lead to contamination, sources said.

"This is a repeated experience in Bangalore. Besides the issue of adjacent pipes leading to contamination, there is also that of open drainage. Most urban slum areas bordering storm water drains are contaminated with sewage which even seeps into the groud water," says Thelma Narayanan of Community Health Cell.

And this:

From Ground Zero: Neelsandra and Bharatinagar

As if scraping together a living were not enough, residents have to cope with medical expenses due to contaminated water
You can barely manage to fit in a two-wheeler on many roads in Neelsandra, hardly a couple of kilometres from the upmarket Koramangala. The other streets are hardly motorable, grappling as they do for space with mounds of black slush and bone-rattling potholes. The narrow roads mean that water and sanitary lines are placed close to each other, a situation pregnant with potential for disaster.

A disaster that has unravelled over the past three days as scores of people continue to fall ill afflicted with suspected gastroenteritis. Mohammed Hussain from R.K. Gardens laughs sardonically when you ask him why gastroenteritis has struck now if conditions in the area had always been so appalling. "We are in the news only now. But come here in the evening and you will see that the ones doing brisk business are private doctors who have long queues outside their clinics."

More:

'The poor are the worst victims'

"Drinking water is not safe for the poor in Bangalore. This is the fundamental issue and the outbreak of gastroenteritis at Bharathinagar is only the symptom of a larger malaise," says Isaac Arul Selva of Jan Sahayog, an organisation that works on urban infrastructure issues.

"Cases of cholera and gastroenteritis regularly occur in slums and lower-middle class localities. They become news only when the numbers are big," he says. Nayandanahalli, Badarayanapura, Koramangala Slum and Andhra Colony are areas where this is an "annual feature," he says.

Jan Sahayog did a study at 35 slums in Bangalore in 2005 that revealed that 75 per cent of water samples were not potable owing to chemical and biological contamination.

The Land Where No One Dies

Ramesh Ramanathan's latest in Mint (no link):

Elections and Voters’ Lists – the DNA of our Democracy

“It seems that nobody dies in Karnataka”, said N. Gopalaswami, Chief Election Commissioner of India. He had just completed a review of the electoral rolls – more commonly known as the voters’ list – in the state. There were an astonishing number of errors, leading the Election Commission (EC) to declare that they would be deleting over 34 lakh entries, and adding close to 10 lakh entries over the coming weeks, in an operation that looks more like a disaster relief activity than a maintenance job on a database – 30,000 government servants deployed at every polling booth, twelve senior level officers at the state level, and four observers from other states.

That’s a huge number. It’s a wake-up call to recognise that this isn’t about bureacratic neglect or administrative incompetence, it’s a fundamental long-running legacy problem. If we don’t address this the right way, we run the risk of putting band-aids when the patient has a deep disease. The disaster relief has to give way to systemic change.

In the short run, the EC’s public announcement has added another dimension to an already twisted political situation in the state. Karnataka is being run under President’s rule, after the tattered coalition government of the JDS-BJP collapsed under the weight of its own bickerings. Right now, all political parties are working furiously to estimate their share of the vote in a possible May election, which might even get postponed. Every caste and community configuration is being parsed – split into sub-castes and further subdivided so that electoral victory can be squeezed out.

This is acceptable electoral politics in India. But the troubling part is the role that weak voter rolls will play in determining political fortunes. Because elections these days hinge on small slivers of margins, which make the difference between fading into oblivion and being victorious.

In the last Karnataka elections, 170 of the 224 candidates – over 75% - won without getting a clear majority of the votes. 116 seats were won with a margin of victory of less than 10,000 votes, and 70 with less than 5,000 votes. If half these votes – less than 2,500 – had swung the other way, the results would have been different. Suddenly, the 35 lakh false entries assumes importance – an average of 15,000 names wrong in each constituency.

All political parties know these errors. There is a flourishing market for these fake names. Its easier to “buy” a fake voter than a real voter, whose loyalty is unpredictable, price is market-driven, and presence at the polling booth on election day is uncertain.

Unfortunately, little can be done to solve this problem, certainly not in the next few months. Contrary to public imagination, the Election Commission of India is a tiny organisation with a small handful of senior Commissioners and support staff. They depend heavily on state and local government machinery to manage their work. This army of grassroot soldiers is a motley group of teachers and revenue officers who double up for this unsavoury job. Ramaseshan, the Chief Electoral Officer of Karnataka said, “There is a human dimension here that we overlook. Women teachers often have to visit voters’ houses late at night, after work hours when they are sure that people will be at home.” And the ripple effects in the major clean-up operation in Karnataka are massive: close to 10,000 teachers are double-timing during exam days, busy toiling away knocking on people’s doors, getting turned away like unwanted salespeople. The instructions are for teachers to do this after school hours, with no additional income. Boy, the price that democracy extracts!

The lessons go beyond Karnataka. The Election Commission is a credible Constitutional authority, and it needs support. It needs financial and human resources to undertake fundamental business process re-engineering in every aspect of electoral roll management: change the entire database of the voters list from a patchwork of excel sheets that resides only with vendors to a secure, single location; revamp roll management to a continuous process rather than a stop-and-start activity; create transparency and opportunities for citizens to engage at a neighbourhood level; use GIS to map polling station boundaries; pay for booth-level officers from the government and post-office machinery; and beef up the technical and administrative support for the EC. All this will cost no more than Rs 1,000 crore a year nationally. It’s peanuts compared to the hundreds of thousands of crores of public resources that corrupt politicians gain access to with the seal of legitimacy that elections confer upon them, dead voters included.

I'm not entirely sure it is just a legacy issue. One of the poor teachers turned up at my house two weeks ago. Sure my name was on the list. But so were the names of three people who I absolutely do not know. How could they be registered to vote from my house? I have never rented out the house ever, the house is just five years old, it was an empty site before that. Who put their names in? And the names were very plausible local names. It must've been deliberately done.

Of course, the larger issue of how the voter list is maintained is a huge problem too. The teachers who this have to be pitied. The poor lady who was 50+ had come once before and since no one was at home, she had come again. And it was pure coincidence that she caught me. All this on foot, and on top of other duties. That's not right at all.

Money Talks

Yeah:

Melbourne: Cricket Australia (CA) bore a scathing attack from its furious players and local media for bowing to the BCCI’s “money power” and letting Indian spinner Harbhajan Singh off the hook with minimal punishment.
...
“It shows how much power India has. The Aussie guys aren’t going to make it up. The players are frustrated because this shows how much influence India has, because of the wealth they generate. Money talks,” an unnamed Australian player was quoted as saying by the Sydney Morning Herald.

‘Cricket’s Day of Shame’ cried a headline in the paper and the report said the players were dismayed to hear “Harbhajan had avoided any meaningful punishment”.

The report also said that CA caved in to India’s muscle flexing as it was anxious to save the tri-series because it feared to be sued for a figure understood to be about $60 million if India quit the tour.

Hey, stop cribbing, that's what superpowers do. Yes, we are the superpower of cricket :

"World cricket authorities have caved in to the game's financial superpower, India, and Cricket Australia has incurred the wrath of its own test players by pressuring them to drop a racial slur charge against Harbhajan Singh," the Sydney Morning Herald reported.

"The Board of Control for Cricket in India had even chartered a plane to take its players home tomorrow if the Indian player's three-test suspension -- for calling Australia's Andrew Symonds a monkey during the Sydney test -- had not been overturned at yesterday's appeal in the Federal Court in Adelaide."

Former Somerset captain Peter Roebuck, writing in the same newspaper, said the Indian cricket board should be condemned for their abuse of power.

"If this is the way the Indian board intends to conduct its affairs hereafter, then God help cricket," Roebuck wrote.

"Brinkmanship or not, threatening to take their bat and ball home in the event of a resented verdict being allowed to stand was an abomination. It sets a dreadful precedent. What price justice now?" Peter Lalor, writing in the national broadsheet The Australian, said the decision was further proof of India's ability to wield their financial power to win events off the field.

And what about Roebuck's comment? His call for Ponting to be sacked and his 'pack of wild dogs' charge were widely reported. But this 'God help cricket' charge languishes in some hidden hole.

There has been a rebuttal by the Indian team:

The Indian cricket team today denied reports that they had chartered a plane to fly its players home on Thursday if bowler Harbhajan Singh was not cleared of racially taunting Australian player Andrew Symonds.

Arriving at Melbourne Airport this afternoon with the team in preparation for Friday's Twenty20 match with Australia at the MCG, the team's media spokesman Dr M.V. Sridhar said the team had not made any such plans.

''I don't know where that came from.There was no thinking like that at all. After what happened yesterday, we're going forward so that the game goes on,'' the Sydney Morning Herald quoted Sridhar, as saying.

A lie of course:

Mumbai: The Board of Control for Cricket in India on Monday reiterated its stand on the Harbhajan Singh ban issue and threatened to call of the remainder of the tour of Australia unless the alleged racial abuse charge against the Indian off-spinner was withdrawn in the two-day appeals hearing starting on Tuesday.

“Our stand remains the same as was the case earlier. We want the racial slur (against Harbhajan Singh) to be lifted. Otherwise the BCCI will recall the team from Australia,” said its Vice-President Lalit Modi on Monday.

My break with cricket is almost complete. Money power, the media circus, accusations of match fixing that keep surfacing, transformation of half-baked cricketers into national heroes overnight - who wants all of that? And of course, the Greg Chappell saga that started the downhill slide for me. I still follow results and the ever new controversies tepidly but indifferently move on to something else. And to think that not very long ago, I considered anyone who didn't watch and follow cricket a bit strange and exotic and a bit difficult to connect with.
Update: Human error led to Bhajji not being banned:

ICC appeals commissioner, New Zealand High Court judge John Hansen, blamed administrative error for the spinner escaping a possible ban.

Hansen said the ICC informed him of one prior offence of the spinner but discovered after handing down his verdict that Harbhajan had been penalised on four previous occasions.

"At the end of the day Mr Singh can feel himself fortunate that he has reaped the benefit of these database and human errors," he wrote in his judgment.

Speed said: "It is very unfortunate that human error led to Justice Hansen not having the full history of Harbhajan's previous Code of Conduct breaches and the ICC accepts responsibility for this mistake."

Human error. Yeah, tell it to the fricking birds.