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My Friend Sancho

My first novel, My Friend Sancho, is now on the stands across India. It is a contemporary love story set in Mumbai, and was longlisted for the Man Asian Literary Prize 2008. To learn more about the book, click here.


To buy it online from the US, click here.


I am currently on a book tour to promote the book. Please check out our schedule of city launches. India Uncut readers are invited to all of them, no pass required, so do drop in and say hello.


If you're interested, do join the Facebook group for My Friend Sancho


Click here for more about my publisher, Hachette India.


And ah, my posts on India Uncut about My Friend Sancho can be found here.


Bastiat Prize 2007 Winner

Category Archives: Politics

A Wrestler Sweats in the Summer

Starting today, two of my limericks will appear every Sunday on the edit page of the Sunday Times of India. This is the first installment.

CULPABLE

Once there was a problem of water
Summer was hot and getting hotter
A politician explained,
‘Our hands are blood-stained.
Bad governance is equal to manslaughter.’

LITIGATION

Once a wrestler tried to move a building
Muscular Sushil grunting and pushing
When chastised,
He said, ‘I was advised
To move court, so that’s what I’m doing.’

Posted by Amit Varma on 22 May, 2016 in India | News | Politics | Rhyme and Reason | Rhymes | Sport


Troller Man

The song below is to be sung to the tune of Billy Joel’s ‘Piano Man’. (Original lyrics here.) I started writing this at exactly 9am today, I swear!

TROLLER MAN

It’s 9am on a Saturday.
Regular tweeps shuffle in.
There’s an old troll sitting on my timeline
Spitting in his tonic and gin.

He says, ‘Slut, why you criticize policy?
I’m not really sure where that goes.
I’d pull you to the street, and I’d kick out your teeth,
but right now I’m not wearing clothes.’

La la la, di di da
La la, di da da da dum.

Sing us a song, you’re the Troller Man.
Sing us a song tonight.
We’[ve done photoshop, we’ve wanked 30 times,
Now we’re in the mood for a fight.

Now Mr Shah at the bar is a friend of mine
He gets me retweets for free
He’s quick with a joke, or a Facebook poke
But there’s someplace that he’d rather be.

He says, ‘I believe achhe din are here,’
As the Muslims rush out of the place.
‘I’m soon gonna be a movie star
in a film called “Buddha in Space”.’

Oh, la la la, di di da
La la, di da da da dum.

Now Naren is a full-on brahmachari
Who never had time for a wife.
He’s talking with Jaitley, who has lately
Put the nation under much strife.

And the politicians are practising warcraft
And the journos are all getting stoned
Poor Sushma sitting in a corner with dignity
Nursing her drink all alone.

Sing us a song, you’re the Troller Man.
Sing us a song tonight.
We’re useless as hell, and we only feel well
When the toddy has made us all tight.

Pappu’s passed out in a corner.
Some scoundrels put gin in his milk.
Politics is tough. This life is so rough,
But his sleep is smoother than silk.

Arvind is out picking pockets
Soon he’ll shout, ‘Hey, the drinks are on me!’
Vadra’s a bouncer, who thinks he’s an announcer
What would he be without family?

Oh, la la la, di di da
La la, di da da da dum.

Sing us a song, you’re the Troller Man.
Sing us a song tonight.
We’[ve done photoshop, we’ve wanked 30 times,
Now we’re in the mood for a fight.

Oh la la la, di di da
We’re in the mood for a fight!

Posted by Amit Varma on 21 May, 2016 in India | Politics | Rhymes


What We Talk About When We Talk About Politics

This is the 27th installment of Lighthouse, my monthly column for BLink, a supplement of the Hindu Business Line.

One of the great things about social media is that we talk to each other much more. I am not being ironic: because of Facebook alone, I know much more about my friends than I would otherwise. I am also in touch with many more people than I would otherwise be, especially old friends. This is useful as one gets middle-aged. At some point around 40, the world starts to narrow and goes on narrowing. Social media keeps it broad, and even recluses stay up-to-date and tip-top, as they’d say back in my day. One could argue that this sense of connection is synthetic, even pathetic, and has no connection with the real world out there. One could also argue that there is only one world, and it is in our heads; and anything in our heads, it follows, is in the real world.

This column is not about the personal, though, but the political. There is far more political awareness among young people today than there was when I was growing up in the 1980s. When I was a teenager, I did not know the difference between left-wing and right-wing, and my informed opinion of Rajiv Gandhi was that he was handsome. Today, 12-year-olds have vociferous opinions and are signing online petitions when they are not on hunger strikes in between meals. Political discourse has increased exponentially in volume; but how much is noise and how much is signal?

There were hopes that social media would lead to a virtual global town square where informed citizens could debate with one another. Instead, it has led to a conglomeration of echo chambers, some of them truly bizarre. No matter what you believe in, you can now find hordes of like-minded people online, and be reassured by the validation they provide. This has lead to a phenomenon that social scientists call ‘group polarisation’. The economist Cass Sunstein defines it thus: “When like-minded people deliberate, they typically end up adopting a more extreme position in line with their pre-deliberation inclinations.”

Thus, we find that most political discussion online consists of people talking past each other. And when they do talk to each other, it isn’t pretty. Anonymity (or even physical distance) turns mice into tigers, and most political discussions online turn personal really fast. If you want to dominate a discussion, you ignore the issues involved and attack the person instead. There are three key ways in which this happens.

One, you accuse your opponent of hypocrisy. (This is also known as Whatboutery.) So if someone talks about the 2002 Gujarat riots, you go, ‘But what about the 1984 Delhi riots? I didn’t see you condemn that?’ If someone points to a Muslim lynched by a Hindu mob, you say, ‘What about that Hindu social worker killed by Bangladeshi migrants in Assam?’ If they defend the free speech of a member of phallana community, you say, what about dhimkana community, where were you when they were censored? Not just trolls, all politicians do exactly this.

When Arvind Kejriwal was questioned about the hundreds of crores of taxpayers’ money he spent on running ads for the Delhi government, he replied, ‘But the BJP also does this. Why don’t you question them?’ There is no end to such Whataboutery—and you will note that on every such instance, the original issue is soon forgotten, and the fight centers on the hypocrisy of the complainant.

Two, you question the intent of your opponent. She could be a CIA agent, a pinko stooge of the Chinese, a lackey for the corporates, a ‘paid audience’ or a ‘presstitute’, in that colourful coinage of a retired army general with that typical Indian penchant for tasteless puns. Ah yes, she could also be anti-national, trying to break up the country. Any issue they raise, they can be told, ‘Ah, but you have an agenda for kicking up a storm. We’re on to you!’

This can be combined most effectively with Whataboutery. For example, if the Congress raises the issue of a corruption scandal in the BJP government, the BJP can say that their intent in raising this matter is to divert attention from their own scam from a week ago. What about that? This can even get recursive. (To visualise this process, imagine fractals.)

Three, you categorise your opponents by applying a pejorative label on them, and then dismiss that entire category as being beneath contempt, thus removing the need to engage with it. This happens across the spectrum. Just go on Twitter, and you’ll find it packed with ‘bhakts’ and ‘aaptards’ and ‘adarsh liberals’ and ‘sickulars’ and so on. Once you apply such a label to someone, you do not need to engage with them in reasoned debate.

Attacking the person instead of the argument is an ancient tradition—some intrepid historian might even find that it is of Indian origin. I have just enumerated the three most common ways of doing this. There are many other ways of appearing to win an argument within even engaging with it to begin with. Check out ‘38 Ways to Win an Argument’, by Arthur Schopenhauer and you will see some examples. They include noble techniques such as shifting goalposts, attacking straw men and appeals to authority. The 38th of them is masterful, and one that many Twitteratti are adept at: ‘Become personal, insulting and rude as soon as you perceive that your opponent has the upper hand.’

Most delighfully, you can not only resort to this, but you can immediately turn the tables with some canny projection when your opponent reacts in anger. He’ll be like, ‘What the fuck did you just call me?’ And you go, ‘Don’t use bad language, did you just say “fuck”? You are clearly not capable of reasoned discourse.’

In a sense, this gets to the heart of the matter. The whole point of political discourse seems not to be political but personal. When we take a point of view, we make an assertion not about the state of the world but about ourselves. Our ideologies become a proxy for personal statements: ‘I am compassionate.’ ‘I am righteous.’ ‘I am clever enough to engineer society.’ Many of our actions in the political sphere are not meant to actually affect change, but to show our nobility. And because our positions are so tied to our identity, any attack on them is an attack on us. We react viscerally. It feels personal; so we get personal.


*  *  *

Also read: My old column written just when the Twitter started getting crazy in India, Internet Hindus and Madrasa Muslims.

Posted by Amit Varma on 13 May, 2016 in Essays and Op-Eds | India | Lighthouse | Media | Politics


Uber and the Auto-Driver

As readers of this blog would know, I’ve long argued in favour of Uber’s surge pricing as an excellent mechanism for matching supply and demand. In a column from last year, I warned against the perils of banning surge pricing:

The most efficient way of allocating resources is to let things find their own equilibrium, their own prices. Price controls are foolish and never work. And the demand for them is based on a sort of a fantasy. Fixing the price of a product at a base price below what the market would pay does not mean that everyone gets it at this price—it just means that a lucky few get it and the others don’t. The fundamental truth about the universe is this: everything is scarce. You can’t wish this scarcity away by agitating or legislating against it.

Now, these fundamental laws of economics apply to everything, not just to Uber. And so Mukul Kesavan, in a column for NDTV, makes the pertinent point:

[S]etting aside Kejriwal’s motives and rationality, the larger question is this: should Uber or Ola be allowed to vary their per kilometre rate at will when yellow cabs and auto-rickshaws are stuck with fixed rates? If, as Uber’s defenders never tire of saying, the app’s algorithms represent the invisible hand of the market, frictionlessly matching supply and demand, why should the individual auto-driver be punished and maligned for asking for more than the metered price?

Shoaib Daniyal makes the same point on Twitter:

Both Mukul and Shoaib are right, though it seems to me that they might both be indulging in whataboutery and creating a straw man at the same time. No one who defends Uber’s surge pricing could possibly support the way the government regulates taxis and autorickshaws. And some of us have written about it in the past—I found this 11-year-old post by me ranting about the licensing of cycle rickshaws in Delhi, citing Parth Shah and Naveen Mandava’s excellent book, ‘Law, Liberty and Livelihood.’ Rather than search for more old posts, though, let me sum up my position here.

In a nutshell, here is how the market for taxis and autos works in Indian cities. The government gives out a limited number of licenses for taxis and autos. This quota does not increase in response to demand. Thus, as demand goes up in relation to supply, you would expect either prices to rise or the supply to rise. The supply is artificially constrained. And the government imposes price controls, so the prices can’t rise either. In other words, if the auto and taxi drivers stick to government-mandated prices, you should expect scarcities. Or you should expect an informal system to develop, where drivers don’t charge the meter rate and instead negotiate with their clients. Both of these are true, to varying degrees, and each of our own cities has developed our informal cultures in terms of dealing with this.

So when an auto guy demands Rs. 400 for a journey that the government mandates should cost Rs. 80, what is the appropriate response? I know some people who will argue that the auto driver, in exchange for his license to drive an auto, has signed a contract with the government that includes those price controls, so he should abide by them. This is a short-sighted argument. I would argue that both the licensing and those price controls are wrong. And I sympathise with the auto driver’s lament that ‘Hey, I’m not allowed to charge a surge price, why should Uber have that privilege?’ How can that not be a valid complaint?

The best way to create a level playing field, though, is to remove those restrictions from all parties, not to impose them on everyone.

Part of the reason Uber and Ola have thrived in India is that they benefited from a need that was created partly by the controls imposed by the government on taxi and auto drivers. The solution is to remove those controls. But removing government controls on the taxi-and-auto industry is higher hanging fruit because of the interest groups involved, and it’s easier to target Uber and Ola, which is what the governments of Delhi and Karnataka are doing. Who suffers in all this? The consumers do. We’re the fish at the table.

The bottomline: Kesavan is right that if we support surge pricing by Uber, we cannot in the same breath curse the local auto-driver for charging ‘extra’. That doesn’t compute.

Posted by Amit Varma on 20 April, 2016 in Economics | Freedom | India | News | Politics


The Model Code

Tarun Gogoi is quoted in DNA as saying:

I have not violated the Model Code. I shake my tush on the catwalk exactly as prescribed. You should see me walk the runway. Eyes ahead, chin down, shoulders even—my body is perfectly balanced. I love wearing silk.

Well, okay, he only said the first sentence—I made the rest up. But you could say it follows, eh? ‘Model Code’ has such a nice sound about it…

image

Posted by Amit Varma on 16 April, 2016 in India | Politics


Pappu Wants Hugs

Once Pappu said something thought-provoking,
He said, ‘Listen up, I’m not joking,
If you give me hugs
I’ll rid Punjab of drugs.’
A reply came, ‘Woh theek hai. But what are you smoking?’

image

Posted by Amit Varma on 16 April, 2016 in India | News | Politics | Rhymes


An Odd Man

Once there was a man of God.
One day, he declared himself odd
And the next even.
He said, ‘I believe in
My buddy Arvind and his Aam Aadmi squad.’

*

One more:

Once there was a man who was odd.
One day he declared himself God
And said, with a wink,
‘You know, I think
We should aim high when we aim to defraud.’

Posted by Amit Varma on 16 April, 2016 in India | News | Politics | Rhymes


Once There Was A Man With A Shoe

Once there was a man with a shoe.
He caught a bad case of the flu.
He sneezed so badly,
His shoe flew off madly
Towards Kejriwal when he did ‘Achoo!’

image

Posted by Amit Varma on 10 April, 2016 in India | News | Politics | Rhymes


Throwing A Shoe At Mr Kejriwal

Yogendra Yadav has condemned the shoe attack on Arvind Kejriwal. He has said:

The incident of hurling shoe at Arvind Kejriwal is highly condemnable. This is not the way to oppose anyone.

This kind of anodyne statement is highly condemnable. This is not the way to oppose anything. To make it more interesting, Yadav could have said:

It was a waste of a shoe. There are people in this country who don’t have shoes to wear. Some would even eat a shoe.

Or this:

The shoe was very poorly thrown. I condemn the poor aim. I’ve been watching it on loop, in slow-motion, on my smartphone for the past two hours, and I would have enjoyed it so much more if it had been aimed properly.

Or even:

I applaud the shoe-thrower. Let’s get past political correctness, people. Before you condemn the shoe-thrower, ask yourself this: Is there anyone among you who wouldn’t love to throw a shoe at Arvind Kejriwal?

Ok, I’m just messing around, but really, tell me this: wouldn’t some of these hypothetical statements make you feel warmer towards Yadav than his banal ‘I condemn this, I’m so noble’ nonsense?

Posted by Amit Varma on 10 April, 2016 in India | News | Politics


Once There Was A Beautiful Cow

So I wrote some limericks for Twitter, and I suppose they’re fun enough to share here:

1
Once there was a beautiful cow
Whose tastes were kinda highbrow
And then one day
Bharat Mata ki jai
She became a dog and said ‘bow-wow.’

2
Once there was a man of God
Who was ever so suitably awed
by a) the divine
And b) the bovine
When he saw a holy cow, he’d applaud.

3
Once there was a wife-beater
Who was a cad, a scoundrel, a cheater
He mastered the arc
of the venomous snark
Now he’s a famous Tweeter.

4
Once there was a central banker
Who seemed solid as an anchor
He lowered interest rates
opened the floodgates
To inflation. What a wanker!

5
Once there was a central minister
Who developed a desh bhakti blister
On his big fat palm
& the only balm
was some grease. How sinister!

*

(Previous posts on cows: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31 , 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 63, 64, 65, 66, 67, 68, 69, 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93, 94, 95, 96, 97, 98, 99, 100, 101, 102, 103, 104, 105, 106, 107, 108, 109, 110, 111, 112, 113, 114, 115, 116, 117.)

Posted by Amit Varma on 05 April, 2016 in Economics | Freedom | India | Old memes | Cows | Politics | Rhymes


Take From The Poor, Give To The Rich

What is the one thing that all governments in the world, without exception, are great at doing? I have you scratching your head there, don’t I? ‘Amit thinks there’s something governments are actually good at doing? Is this April Fools Day?’

Here’s my answer: they’re all good at redistributing wealth from the poor to the rich.

I have written before about how all interventions in the free market amount to a transfer of wealth from “the relatively poor masses to a specific relatively rich interest group.” The BJP government just provided us a great illustration of that with some new regulations on e-commerce businesses in India. On the face of it, there’s good news, because they’ve finally ‘allowed’ 100% FDI in online retail. But then there’s this:

It also notified new rules which could potentially end the discount wars, much to the disappointment of consumers. This is because the rules now prohibit marketplaces from offering discounts and capping total sales originating from a group company or one vendor at 25%.

This affects many of the existing players adversely. Big Basket, for example, might have to shut down entirely, says FutureGroup CEO Kishore Biyani. Flipkart and Amazon will also face restructuring problems. But forget these companies, and dig a little deeper to see who really suffers here.

We do. Whatever costs these companies face are passed on to consumers. A decrease in competition also affects the value for money that we get. This is axiomatic. Because of these regulations, we will get less bang for our buck. We are, effectively, losing wealth. Where is this wealth going? For this, think about who benefits.

The BJP has long considered small-and-medium-sized traders to be an integral part of its votebank. They were getting adversely affected by online retail, as consumers obviously gravitated towards whoever gave them more value. Traders are an important interest group for the BJP not only because they represent a votebank, but also because they contribute to the campaign coffers of the BJP. And money buys power for what? To make more money.

These regulations benefit these brick-and-mortar retailers and traders, as they will lose less business than they otherwise would because online retailers will be able to offer less value than they otherwise would.

In other words, this is a redistribution of wealth from poor consumers at large to a specific relatively-rich interest group. (Indeed, given the quid-pro-quos involved, you could argue that the party in power is itself the final beneficiary of this transfer of wealth.)

Another data point on how this government is helping this particular interest group: Gujarat has just passed a bill imposing new taxes on all “goods purchased through e-commerce portals.” You know who this hurts, right? You know who this helps?

Governments always carry out such interventions using noble rhetoric of ‘leveling the playing field’ and helping those poor [insert rich interest group here]s. But the beneficiaries here are not owed a living by anyone, and are not entitled to any money apart from what consumers willingly give them in a free market. The money that the consumers would save because of unhindered online retail, after all, would have gone back into the economy in some form. (For more on this, I refer you to the great Frédéric Bastiat’s famous essay, ‘What is Seen and What is Not Seen.’)

*  *  *

Here’s my three-fold path to evaluating government policy:

1. Ignore the rhetoric.

2. See who it helps.

3. See who it hurts.

It’s the same story, always, every time. It’s the poor who suffer.

*  *  *

Also read: ‘The Great Redistribution’, my earlier column on this subject, where I use an example where the protagonist and antagonist interest-groups in question are the reverse of the ones in this post, but it’s still the poor who suffer.

Posted by Amit Varma on 31 March, 2016 in Economics | India | News | Politics


The Chronology of Hate

In an excellent piece in the Hindustan Times, which mentions the ‘soft Hindutva’ of the Congress, Samar Halarnkar writes:

The facade [of secularism] is now gone. History tells us that when popular governments legitimise hate (fascism and racism are some examples; closer home, the anti-Sikh and post-Babri riots), it is a matter of time before a country’s majority population follows suit. If — or as — that happens, don’t expect much from the party that was India’s secular, political hope.

I have a small quibble here. The chronology is the other way around. It is not that governments (and parties) legitimise hate, and then the people ‘follow suit’. Rather, it is the people who feel that way to begin with, and drive the political parties to act in the way they do. In the political marketplace, demand drives supply. Parties indulge in the politics of hate or bigotry (or just generally identity) because there is a market for it.

Andrew Breitbart once said, ‘Politics is downstream from culture.’ That is true of India as well. The filth that is there in our politics is a reflection of our society.

As for the ‘soft Hindutva’ of the Congress, they indulged in it even before India got Independence, and they clearly feel that there is a large constituency for it today as well. Consider, for example, this. And this.

Whatever pejoratives we apply to our politicians, they are not fools. If they behave in particular ways, they do so because there is demand for it.

Also read: ‘It’s Cascading Trump, It’s Cascading Modi!’, my column from last week on this subject.

Posted by Amit Varma on 22 March, 2016 in India | News | Politics


The Manner of Their Hanging

The Times of India reports:

In an incident reminiscent of the Dadri lynching, two Muslim men herding eight buffaloes on their way to a Friday market were beaten up and hanged to death from a tree by suspected cattle-protection vigilantes in Balumath forests in Latehar district, 100km from the state capital, early on Friday.

The deceased, Muhammad Majloom, 35, and Azad Khan alias Ibrahim, 15, were cattle traders and related to each other. Their bodies were strung up with their hands tried behind their backs and their mouths stuffed with cloth.

“The manner of their hanging showed that the assailants were led by extreme hatred,” said Latehar SP Anoop Birthary.

This feels like a nightmare, the use of the term ‘cattle-protection vigilantes’ in a news story about a lynching. What has been unleashed here? Who is responsible for this?

The people in power make responsible noises about reforming the economy and increased federalism and blah blah blah. That is all nonsense. Government is just getting bigger and more oppressive, and stealing more from us by way of taxes and cesses. This government is, in every substantive way, left-wing on economics. Many of my friends, who supported them in opposition to the family firm that ravaged our country for decades, are still in denial about this. On economics, on progress, on growth, these guys are as bad as the previous lot.

And in the social domain, they are worse.

It is natural for mass political leaders to draw on baser instincts of identity and tribalism for their popularity. Reason gets you only so far, so you appeal to the reptile brain. Behind the optics of ‘achhe din’, that is the double game the BJP is playing. But it has a cost. That cost includes ‘cattle-protection vigilantes.’

As Prem Panicker writes with regard to this incident:

This is what happens when you let the genie out of the bottle. People die.

For a proximate lesson from the neighbourhood, look at what Zia-ul-Haq unleashed in Pakistan.

Arun Shourie once memorably called this government ‘Congress plus a cow.’ He was almost right.I would call it ‘Congress plus cattle-protection vigilante.’

There is a difference; and it is a horrifying difference.

*  *  *

Also read: My column from yesterday speculating on the commonalities between the Trump wave and the Modi wave: ‘It’s Cascading Trump, It’s Cascading Modi!’

Posted by Amit Varma on 19 March, 2016 in Freedom | India | News | Politics


It’s Cascading Trump, It’s Cascading Modi!

This is the 25th installment of Lighthouse, my monthly column for BLink, a supplement of the Hindu Business Line.

We live in strange times. A few days ago, my friend and fellow libertarian, the writer Shikha Sood Dalmia, posted on Facebook: ‘Am I going mad or is the world? In America, I’m rooting for a Democrat and in India I’m defending a bloody communist!’

I was doing the same. In America, the bigoted, nativist, protectionist Donald Trump was dominating the Republican primaries, unleashing invective of the sort that usually only anonymous online trolls dare to express. In India, Narendra Modi’s government carried out a venal persecution of a few university students, based on doctored videos and a fake tweet. They arrested one of them for sedition, who was then beaten up by lawyers in the courthouse as the police looked on passively. My support, instinctively, went to the Democrats in the US; and to the beleaguered communist students in India.

What is going on here? How can a man like Trump be on the verge of leading the party of Abraham Lincoln? Why is Indian politics slipping back into crude tribalism just when India should finally be marching towards modernity? Could there be one answer to both these questions?

A few days ago, the American columnist Glenn Reynolds wrote a piece titled ‘A Trump wave is on the way.’ To explain the Trump phenomenon, Reynolds cited a book by sociologist Timur Kuran, Private Truths, Public Lies: The Social Consequences of Preference Falsification.

Say you are at a dinner party at your boss’s place. The food is terrible: the dal makhni has no salt, the butter chicken has too much tomato puree. Your boss asks how you like the food. You murmur your appreciation, as you’ve seen others on the table do. You are hiding your actual preference in order to fit in or avoid social awkwardness. This is ‘preference falsification’. Everyone at the table may have hated the food—but everyone may think that everyone else loved it.

Preference falsification can have grave consequences. Kuran cites the Soviet Union as an example. The Soviets used the strong arm of the state to clamp down on free speech, which made it hard for people to express their preferences. Even if 99% of the people hated Communism and wanted the government to fall, it would not do so because of preference falsification: these people would not know that so many others thought just as they did. Until suddenly, one day, the public expression of that preference reached a critical mass, and a phenomenon that Kuran called a ‘preference cascade’ took place. From the outside, it might seem that a regime toppled suddenly, overnight, without warning—as we saw throughout the former Soviet Bloc. But while the preference cascade may have been sudden, the preferences themselves were not new.

Reynolds invokes Kuran in the American context, and speculates that Trump’s surge could be the result of a preference cascade. Maybe Trump is articulating views that other would never do themselves in public. (‘I hate foreigners.’ ‘Mexicans are rapists.’ ‘All Muslims should be deported.’ Whatever.) Once they see a prominent man like him say these things, and others rush out in support, they are emboldened to vote for him. Now that they know there are others like them, they join the Trump wave.

Now, shift your attention to India. My view of the last elections until recently was basically this: the BJP got its highest voteshare ever because not only did it mobilize its traditional base – the Hindutva voters – they also attracted other voters who were sick of the UPA’s corruption, who wanted economic reforms, and so on. And now that the BJP was bound to disappoint some of them, it would lose voteshare, compunded by the opposition consolidating against it (as in Bihar). So a desperate party would double down on Hindutva to mobilise its core Hindutva vote.

But what if this is all wrong?

What if the rise of Modi is a result of sudden preference cascades following decades of preference falsification. In Gujarat, for example, what if the majority Hindus bear an unspoken antipathy towards the minority community? They may not express it openly because it’s awkward to do so. Then the 2002 riots happen, and Muslims are ‘put in their place.’ Modi, then chief minister, never openly takes credit for it, but he doesn’t deny his culpability either, and you can read between the lines. Boom, Modi wins the next elections in a landslide—and every state election after that.

Similarly, what if many Indians silently share notions of cultural or religious superiority that are not polite or politically correct to express publicly? (I am attempting dispassionate political analysis here, and this is not meant to be judgmental.) The rise of Modi at a national level could have led to a preference cascade, and though these voters might have come up with many policy reasons for voting for him—‘He will make GST happen’ etc—those may have been rationalisations more than reasons. (Note: I am not implying that all BJP supporters are like this.)

But why now? What suddenly enabled this preference cascade? I have an answer : social media.

Social media exploded in India over the last six years, just as Modi’s national ascent began. Social media lets you express your preferences far more freely than in real life, because you’re either anonymous, or you’re at a physical remove from whoever you’re talking to. So more true preferences get expressed—and more and more people see more and more opinions validating their own preferences. Cascade!

If this is true, then in both America and India, beneath the veneer of sophisticated political discourse, there lies a primal core that cares about more basic things, like race and identity and so on. In fact, maybe the exact same impulse explains both Trump and Modi: the instinctive attraction for a strong leader who will lead our tribe well and shit on all others.

But these are just theories, and they could be wrong, or merely partly right. And there could be other silent preferences out there waiting for their cascade. What could those be? Who will make it happen?

Posted by Amit Varma on 18 March, 2016 in Freedom | India | Lighthouse | Politics


Obey the Laws

Donald Trump said in the CNN Republican debate a short while ago:

We have to obey the laws, but we have to expand the laws.

Could there be a better illustration of how politicians view laws not as constraints but as tools?

Posted by Amit Varma on 11 March, 2016 in Politics


The Right to Cheap Multiplex Tickets

IBN reports that the Karnataka government “is mulling a limit or maximum cap of Rs 120 to be charged on movie tickets in multiplexes.” This is intended to make movies more affordable for regular moviegoers, thus increasing viewership and helping the film industry as well. These are laudable objectives. Who could argue with making movies more affordable for the poor?

In fact, I would argue that the Karnataka government has not gone far enough. Why restrict this benevolence to movies?

I hereby propose that the prices of cars be capped at Rs 80,000. This will help the poor.

Also, the prices of meals at restaurants should be capped at Rs 30. This will help the poor.

While we’re at it, airline tickets should be capped at Rs 300. Why should only the privileged rich be allowed to fly?

Please don’t tell me you object to any of these wonderful ideas. There is no argument against these that don’t also apply to multiplex tickets. Don’t you agree?

(Link via Madhu Menon.)

*  *  *

On a serious note, here’s a piece by me on price controls: The Price is Right.

Posted by Amit Varma on 10 March, 2016 in Economics | India | News | Politics | WTF


The False Binaries of Indian Politics

This is turning out to be a crazy year. All my life I have raged against the damage that socialism has done to India, with the leftist economic policies of Jawaharlal Nehru and (especially) Indira Gandhi ravaging our country for decades, condemning hundreds of millions to poverty and all its attendant ills. And yet, a few days ago, I was applauding an hour-long speech by a young Communist, sharing the link widely, quoting from it. Kanhaiya Kumar’s speech after being released from prison was a remarkable act of oratory and defiance, combining great passion with fine comic timing. Its content was irrelevant: for the moment, we were up against a greater evil, and we could revisit the speech at leisure.

Well, that time seems to have come. Makarand Paranjape gave a very fine lecture on nationalism at the JNU, with Kanhaiya present, and asked some difficult questions. His speech was nuanced; and it was also about nuance. It warned against a simplistic reading of either history or politics, and pointed out some areas in which, he said, Indian communists could do with some reflection. This included the Communist Party of India’s role (or non-role) in India’s struggle for independence, as well as the many lives that Stalin took.

Right after he spoke, Kanhaiya rose and began the Q&A session by asking Paranjape five questions. One, did he condemn Gandhi’s killing by Godse? Two, did he condemn the violence at Patiala House? Three, did he condemn a particular violent slogan? Four, did he condemn another slogan that was a veiled threat towards Umar Khalid? And five, what political party did he belong to? After Kanhaiya, another gentleman stood up and asked why, while mentioning Stalin, did Paranjape not mention Hitler.

These questions reveal such poverty of thought. (And the very absence of nuance that Paranjape had bemoaned.) Here’s the mistake these gentlemen made: politics does not revolve around binaries of fascism and communism (or left and right). Kanhaiya seemed to assume, if one goes by his questions, that if Paranjape questioned the role of the Left in India’s Independence struggle, then he must surely be a supporter of the Sanghis, and by extension of Godse. If he was questioning the facts in Kanhaiya’s speech, he must surely be a supporter of Modi and the Patiala House goons. The other gentleman implied that by invoking Stalin and not Hitler, by questioning communism but not mentioning fascism, Paranjape had revealed his preference. (Paranjape’s selective mentions were obviously in the context of getting the left to introspect on its history, and that alone.)

These are false binaries. Most sensible people will be against both the extreme right and left, against both the Sanghis and the commies. Hitler and Stalin were both monsters, and their evil sprang not in separate ways from their different ideologies, but from the common core of both those ideologies: the willingness to use coercion and ignore individual rights to reshape society according to their vision. In this, the communists and fascists are identical. They are not at opposite poles. They are the same.

I had drooled over Kanhaiya’s speech when it happened, and I didn’t mind the fact that he was communist. That was, after all, the environment around him, and he probably wasn’t even exposed to other ways of looking at the world. He seemed passionate and eloquent and intelligent, and that was a good starting point. But his questions to Paranjpe seemed to indicate that he wasn’t just unwilling to be self-critical about his beliefs, but is perhaps incapable of doing so. (That is a harsh reading, I know, and I hope I am wrong.)

You might ask here, if I oppose both sides equally, then why have I shown far greater concern (and anger) at the activities of the Sanghis than the commies? Simple answer: they’re the ones in power right now, with a legal monopoly on violence and coercion. Therefore they’re the greater danger. Also, the commies are not a force in India any more, despite this brief moment in the sun (courtesy Modi’s blundering minions). But the Sanghis are growing in power and influence. (I shall elaborate on this in the next edition of Lighthouse, which appears next week in a suitably named newspaper.)

I should add here, as I keep pointing out, that quite apart from the false binary of the two extremes that I have mentioned in this post, thinking in terms of left or right itself is fallacious in the context of Indian politics. All Indian governments have been left-wing on economics and right-wing on social issues, the exact opposite of what a poor beleaguered libertarian like me would like. Mere baal dhoop mein safed nahin hue hai. (In fact, mere baal safed hue hi nahin hai, but leave that aside.)

My earlier pieces on this:

‘Looking Beyond Left and Right’
The Fatal Conceit of the Indian Politician
Lessons From 1975

Posted by Amit Varma on 09 March, 2016 in India | News | Politics


The Common Explanation for Trump and Sanders

Why are Donald Trump and Bernie Sanders doing so well, while conventional heavyweights in their parties seem to be taking a beating? I got a sense of that in this Politico analysis of Hillary Clinton’s campaign after New Hampshire which had the strap:

After a devastating defeat, her campaign hopes to rebound with a sharp focus on African Americans.

In similar vein, Shikha Sood Dalmia wrote an excellent analysis of why Ted Cruz won Iowa despite being against ‘the Hawkeye State’s beloved ethanol fuel mandate’. To sum it up:

Cruz assembled a broad but piecemeal coalition of conservative voters by giving each faction something it really, really cared about.

Elsewhere, there is analysis of the four men (Rubio, Kasich, Bush, Christie) fighting for the ‘establishment lane’ of the Republican party.

Do you see what is happening here? Politicians typically think of voters as a market (as indeed they are in the political marketplace) and divvy it up into segments and strategize accordingly. But Trump and Sanders are unconventional politicians whose fundamental message seems to be: ‘This is who I am. This is what I stand for. I won’t tailor my message for anyone. I won’t pander to any group of voters or to special interests. I am different from your typical slave-to-special-interests politician. Are you sick of them too? Vote for me!’

Now, forget the sincerity of this message: what matters is how they come across. And voters are sick of business as usual. This election was supposed to be Bush vs Clinton, but Jeb Bush and Hillary Clinton would be very similar presidents, firmly in the pockets of special interests, albeit different ones. Trump and Sanders clearly would not. (At least, that’s the message.) So that’s the appeal.

You could say it’s the same appeal Arvind Kejriwal had in India.

Now, I strongly oppose Trump and Sanders (and for that matter Kejriwal), because as much as what you stand against, one must also see what you stand for. Trump is whacko in every way. Sanders is whacko on economics. (Kejriwal is Indira Gandhi all over again.) But that is not the point. The point is that conventional politicians cannot hope to capture those constituencies (in their language!) unless they accept that the system is broken to begin with, and communicate that in a credible way. The establishment guys seem to be in denial that the public is turning against the establishment. So this is going to be fun.

The elections in the US are already the greatest reality show ever. It is fitting, therefore, that Trump should be the star.

Posted by Amit Varma on 10 February, 2016 in Politics


Looking Beyond Left and Right

This is the 23rd installment of Lighthouse, my monthly column for BLink, a supplement of the Hindu Business Line.

One of the things that most exasperates me about Indian political discourse these days is that we often speak in terms of ‘left-wing’ and ‘right-wing’. This is wrong for two reasons. Firstly, this is not how politicians themselves actually speak (unless they’re humouring the English-speaking media). Voters in India vote for a myriad of reasons, mostly local, and they don’t frame issues in terms of left or right. Therefore, neither do politicians when they speak to their constituencies, or when they strategise among each other. There is, thus, a disconnect between politics and political discourse. Many political commentators, unable or unwilling to engage with the complexities of the political economy, insist on imposing simplistic narratives.

But this would not matter if a left-right prism was useful in evaluating the desirability of policies, or provided a compass to gauge the moral or instrumental value of the actions of politicians. But it does not, which brings me to my second reason, which is not a local one. Across the world, framing issues in terms of left or right misses the central principle at stake in any modern society: that of individual rights, and of freedom. I view the world through a classical liberal (or libertarian, if you will) prism, and my liberalism boils down to a respect for individual freedom. On moral grounds alone, if we come from first principles, we should respect individual freedom above all else. From a consequentialist perspective, also, we should defend freedom, for economic freedom leads to material prosperity, and personal freedoms, such as freedom of speech, enrich our culture.

As a true liberal, I see no difference between economic and social freedoms. As I am fond of saying, once we accept that two consenting adults may do whatever they want with each other provided they infringe the rights of no one else, it should not matter whether they are fucking in a bedroom or trading in a marketplace. Interfering with either is wrong. And here’s the thing: parties on both the left and right sides of the political spectrum support infringements on individual freedom all the time.

Parties on the right tend to want to impose their cultural values on others, and are suspicious of those they view as ‘outsiders’. They don’t care much for free speech or other personal freedoms. Parties on the left tend to oppose economic freedom. They do so stating noble reasons, but all infringements of economic freedom amount to a redistribution of wealth from poor consumers to a rich interest group, so they’re either hypocrites or delusional. They also tend to favour big government, which means more taxation, and therefore more coercion.

If you believe, as I do, that coercion is wrong, then it won’t make a difference whether you look left or right, you’ll see coercion everywhere. A classical liberal opposes both Donald Trump and Bernie Sanders, both Prakash Karat and Mohan Bhagwat. (I would give credit to those guys for at least stating their positions clearly, though. Politicians down the ostensible middle, slaves to special interests as they mostly are, tend to be equally coercive and far more hypocritical.) Looking at the political marketplace, you will find that the options available to you aren’t all that different from each other. And why should they be? Even when they cater to different segments of the population, they’re still reacting to the same inevitably corrupting incentives at work in the political economy.

Here’s the funny thing about India in particular. We have conveniently classified the BJP as a right-wing party and the Congress as a left-wing party—but they’re both practically the same party. In terms of economics, both are left-wing, and oppose economic freedom. It might surprise you to hear me say this about the BJP, but forget their campaign rhetoric and consider their actual policies: Modi I is basically UPA III. Modi has the same top-down way of looking at the economy as any Congress leader before him, and he’s trigger-happy when it comes to imposing new taxes and cesses.

Equally, on social issues, the Congress was as right-wing as the BJP allegedly is. They have a stellar record when it comes to banning books, and it was a Congress government that effectively banned The Satanic Verses. Censorship flourished under their watch, as did attempts at social engineering, which weren’t restricted to the Emergency: odious policies on sterilisation still exist, decades after the emergency was called off. Even in terms of attacking other communities, the Congress set the standards: more people died in the 1984 riots than in the 2002 riots. My friend, the political commentator Nitin Pai, once coined a term that describes this jostling between the parties perfectly: ‘Competitive Intolerance’. This is quite the kind of competition that makes the poor ol’ free-marketer in me cringe!

To sum it up, India’s political parties tend to be left-wing on economics and right-wing on social issues. In other words, they oppose freedom in every sphere. I would be no more disheartened by this than India’s freedom fighters were in the first half on the last century, when they gazed up at the monolithic British empire. They gritted their teeth, and hurled themselves into the battle for our political freedom. Likewise, we must keep fighting till we win these other freedoms, and emerge as a free country at last. Not a left country, or a right country, but a free country.

Posted by Amit Varma on 11 December, 2015 in Economics | Freedom | India | Lighthouse | Politics


Honk, Mr Gadkari

NDTV reports:

A road near Delhi notorious for hours’ long traffic jams has finally found the right victim. After stewing in a two-hour jam last night, Road Transport Minister Nitin Gadkari has ordered a solution within 24 hours.

“We are studying the traffic of Delhi and the report will come to me in 15 days. We will identify the black spots of Delhi and also inform the Delhi government. We will jointly solve this traffic jam problem,” Mr Gadkari told reporters today.

I have two observations to make here. One, you will note that Gadkari has ‘ordered a solution within 24 hours,’ and to make it happen, has commissioned a report that will be ready ‘in 15 days.’ This is delicious. If Kafka made this up, you’d wag your finger at him and say, ‘Now now Franz, you’ve gone too far this time.’

The other observation must have struck you as well. So Gadkari, who is the road transport minister, realises there is a traffic problem only when he is personally stuck in traffic? Is that what it takes for a minister to truly realise the problems a country faces. Will Arun Jaitley start worrying about rising prices only when he himself is unable to afford onions? Will Birender Singh, the minister for drinking water and sanitation, wake up to the urgency of the problem in India when he himself gets jaundice? Otherwise it’s academic, stuff that written in files, push ‘em around, keep pushing, push harder?

You could argue that this question is moot in the case of our education minister, who is herself uneducated. I suppose that’s a good start.

Posted by Amit Varma on 09 December, 2015 in India | News | Politics | WTF


Have an Omelette

Does it make any sense for a government to apologize for wrongs committed decades, even centuries, earlier? Don Boudreaux thinks not:

Imagine if we conducted our personal affairs as governments conduct their affairs: even the most atrocious and grievous wrongs that we commit would be apologized for, not by those of us who commit the offenses, but only by our grandchildren or great-grandchildren – people who had no hand at all in the commission of the now-formally-apologized-for wrong.  Who would take such apologies seriously?  “Great-great-grandchildren of armed robber apologizes for their ancestors’ wrongful acts.”  How meaningless can an apology be?

I like that way of thinking, actually. Let’s continue down that road of what would happen if you conducted your personal affairs as governments conduct theirs. Say you forcibly took 30% of the earnings of every person in your housing society, offering in return your notional protection. You set down norms of behaviour, including who can visit them and if they themselves are allowed to leave the premises. Maybe you don’t allow them to drink alcohol; or eat beef; or speak their mind freely. You regulate what they may or may not buy from the market, and you get a piece of whatever they purchase. If they buy 12 eggs, two come to you. Have an omelette.

I could go on forever, but here’s the thing: If you actually behaved the way a government does, you’d be treated as a thug by society, and locked up by the government, which would consider you competition, and would naturally like to have a monopoly on that kind of behaviour. Ah, but you now protest, I am stretching it too far. All of us signed a social contract. And it is legitimate for the government to behave in this way.

Well, I didn’t sign any contract. And why is it legitimate?

Posted by Amit Varma on 08 December, 2015 in India | Politics | Small thoughts


Arvind Kejriwal vs Santa and Banta

First Post has a headline right now that says: “Kejriwal speaks out against ‘Santa-Banta’, supports plea to ban jokes on Sikh community.”

Kejriwal is doing this, no doubt, because AAP intends to stand for elections in Punjab, and he’s taking what he hopes will be a popular line there. This illustrates what I’ve said all along about the man: he only cares about power, not principle, and will take whatever populist line gets him votes. His opposition to FDI in retail was one example of how he’s against economic freedom. (Such opposition amounts to redistributing wealth from poor consumers to a specific rich interest group, as I pointed out here.) And now we find that he doesn’t believe in free speech either. He’ll do whatever it takes to get votes.

In this, he is no different from any other politician. But he projects himself as being different, which is why pointing out this aspect of his character is important. The politician Kejriwal reminds me of most is the vile Indira Gandhi. And as I wrote recently, Narendra Modi also reminds me of Indira in some ways. Talk about picking a bipartisan role model!

Posted by Amit Varma on 03 December, 2015 in Freedom | India | Politics


Where Your Taxes Go: 48

Towards advertising in The Organiser, the RSS magazine.

As India Explained remarked, Achhe Din.

Really, all that a change in government means is that a different set of thugs gets to loot you.

(For more on how our government loots us, click here.)

Posted by Amit Varma on 01 December, 2015 in India | Old memes | Taxes | Politics


The Real Issue Regarding The National Anthem

There’s an interesting video that seems to have gone viral on social media showing a bunch of hooligans in a film theatre haranguing (and eventually ejecting) a couple who did not stand when the national anthem was played. Some people on Twitter appear to think that this is an issue of patriotism. Well, no it isn’t. It’s an issue of individual freedom and coercion.

In some jurisdictions in the country, it is compulsory to stand when the national anthem is played. This compulsion by the government is something I object to. People should be free to stand if they feel like; and to not stand if they don’t want to. Your patriotism should not be measured by your empty allegiance to a mere symbol; and in fact, it should be nobody’s business whether you are patriotic or not.

Also, when you watch the video linked to above, consider that the people being unpatriotic are not the ones who didn’t stand for the anthem, but the ones insisting that they should have. The idea of India that I subscribe to is one in which India being a free country means that all its citizens are free from the kind of coercion and goondagardi that we see in that video. The mob in that video pretending to be patriotic—they are traitors in my eyes. Whether they stood for the anthem or not.

In fact, it is a travesty that the theatre management did not intervene on behalf of the two ticket-paying patrons who were forced out of that hall. As for those hooligans, they should have been arrested for creating such a disturbance on someone else’s property.

*

By and by, I was a panelist on We The People, Barkha Dutt’s show, at the start of 2008 in which the topic for discussion was exactly this: national symbols, and whether there should be any holy cows. Towards the end of the show, Barkha asked each of her panelists for a response on whether India should have holy cows. My response, about 47:50 into the show:

The only kind of holy cow I believe in is one from which you get a divine steak.

My co-panelist Smriti Irani met me backstage after the show and told me that I’d better be careful about making such jokes about an animal that is the object of reverence for Hindus. I think she was educating me about the dangers of blaspheming publicly, and as such, her post as education minister in a BJP government seems quite apt.

Posted by Amit Varma on 30 November, 2015 in Freedom | India | Politics


The Asuras Have Taken Over

As today is apparently Constitution Day, here’s a thought from the great BR Ambedkar, who is considered the chief architect of our constitution:

We built a temple for a God to come in and reside, but before the God could be installed, if the devil had taken possession of it, what else could we do except destroy the temple? We do not intend that it should be occupied by the Asuras. We intended it to be occupied by the Devas. That is the reason why I said I would rather like to burn it.

These words were spoken in parliament in 1953, if I remember correctly.

I’m surprised that so many smart people I know express reverence for our constitution. Our constitution is deeply flawed: it does not protect freedom of speech or the right to property, and is a sprawling, unwieldy cut-paste job that has constantly been amended over the decades to suit the nefarious purposes of politicians. Ambedkar himself felt this way in 1953—things have only gotten worse since then.

Do watch this great lecture by Shruti Rajagopalan to get a sense of the journey our constitution has travelled.

Posted by Amit Varma on 26 November, 2015 in India | Politics


All Your Base

Munna Kumar Sharma, the national secretary of the Hindu Mahasabha, has said about Aamir Khan:

If not move to Pakistan, he should indulge in ‘ghar wapsi’ to free himself from the crimes of ‘love jihad’ that he has committed.

I love that sentence, for the way in which it combines three Hindutva tropes into one sentiment. There is genius there—or should I say, Hindu Mahagenius?

Posted by Amit Varma on 25 November, 2015 in India | News | Politics


The Image of the Country

So how has the government reacted to Aamir Khan’s recent comments about the growing intolerance in India? Rediff reports:

The government on Tuesday termed as “misplaced” superstar Aamir Khan’s comments on growing intolerance, saying such statements only bring disrepute to the country as well as Prime Minister Narendra Modi.

“His comments on intolerance is completely misplaced. Comments like this only bring the image of country and the Prime Minister Modi down,” Union Minister of State for Home Kiren Rijiju told reporters on the sidelines of a function in New Delhi when asked to comment on Aamir Khan’s statement on Monday at an award function in the national capital.

The Modi government’s obsession with optics is now getting beyond parody. These guys are more concerned with image than substance. This is understandable during a campaign, but they won the damn election and are actually governing now. Why so insecure?

Meanwhile, bhakts on Twitter have made it quite clear that Aamir’s claims of intolerance won’t be tolerated. What fun.

Posted by Amit Varma on 24 November, 2015 in India | News | Politics


The Sleeping Man Festival

This is surely the headline of the day:

Rat climbs on sleeping man, takes selfie!

I have friends who would argue that is Narendra Modi and India.

Posted by Amit Varma on 24 November, 2015 in India | News | Politics


Two Directions

I’m travelling at the moment and haven’t been following the news too closely, so I’m hesitant to comment on the Bihar elections. One thing I can say for sure, though: all simple narratives are wrong. Elections are complex phenomena, and a mix of personal, local and national reasons—in that order—make people vote the way they do in state elections. Any one-line explanation of the elections will always be wrong.

One thing that seems clear to me actually renders the future unclear: the BJP will now consciously veer in one of two opposite directions. They will either sideline the communal elements in the party and continue pushing for ‘development’; or they will go all out appealing to religious nationalism (and caste-based politicking when relevant). I think the time when they could do both credibly is behind us now.

If they go the religious nationalism route, they can be assured of their core vote-share of maybe around 15% that will be loyal to them. Where do they get the rest from? In 2014, people were just fed up and wanted to be rid of the UPA, and the BJP’s development rhetoric was attractive. But this government hasn’t delivered and isn’t doing anything to deliver on the kind of economic growth that lifts all boats, as it were. It is safe to say that many who voted for them on the ‘development’ or ‘change’ planks are disappointed. Many of the votes they lost in Bihar are probably on that account. Plus, of course, the opposition consolidated, as they will continue to do so. Even if the BJP hold that national 31% of the voteshare they got in 2014, they will lose seats next time around because wherever a mahagatbandhan is possible, one will emerge. The paradigm is BJP vs the rest now, not Congress vs the rest.

So here’s the upshot: the only way BJP will be a dominant party in future Indian politics is if it delivers on development and sidelines the nutjobs. But its gains in that case are nebulous and hard to pin down in numbers. Ditching development, increasing communal polarisation and mobilising those core voters, on the other hand, guarantees it a stable base, but has an upper limit. By itself, it is not enough to keep the BJP in power—unless the nutjob constituency grows, a prospect that terrifies me.

I suspect that the BJP will stay in its historical comfort zone. They might talk development but will walk identity politics, as they did in Bihar. Every failure will push them further into that comfort zone. They will growl and periodically lash out from a foetal position.

This is definitely a simplistic analysis. (All topical political analysis is.) I hope I am wrong.

Posted by Amit Varma on 09 November, 2015 in India | Politics


Exhibit A

Dibakar Banerjee may have made a bit of a fool of himself by returning an award that wasn’t his to return, but he’s absolutely right that Anupam Kher “has every right to be unhappy.” Kher, the hypocrite who once headed the censor board of India, is not when he says:

Nobody has the right to call India intolerant.

I can’t imagine where his concepts of rights arises from. Everybody has the right to call India anything they damn well please—and he has the right to disagree, as Banerjee pointed out. It is incredibly ironic that his riposte to those complaining about rising intolerance in India actually proves their point. The elite and supposedly cultured Anupam Kher is Exhibit A.

Posted by Amit Varma on 07 November, 2015 in Arts and entertainment | India | News | Politics


Isn’t it Ironic?

First, Arun Jaitley says that Narendra Modi is a victim of intolerance.

Then, Swarajya magazine writes that India’s ‘educated class’ is fascist.

And today, the BJP accuses Nitish Kumar of ‘vote bank politics’ in Bihar.

There is a term for all this.

Posted by Amit Varma on 04 November, 2015 in India | News | Politics


Tantrik Baba

Mid Day carries the following headline:

Tantrik promises to make it rain money, leaves 60-yr-old penniless.

This is Indian politics. Exactly this.

Posted by Amit Varma on 03 November, 2015 in India | Politics | Small thoughts


Eating Dog, Eating Fox

A BJP worker in Shivamogga has warned the Karnataka chief minister S Siddaramaiah of consequences if he dares to eat beef.

Let him eat beef at Gopi Circle in Shivamogga. If he does so, he will be beheaded. We won’t think twice about that. By making such a statement, the Congress leader has hurt the sentiments of Hindus. We have all grown up drinking cow’s milk.

This is standard-issue macho bigotry. I’m not surprised at the talk. I was more taken, actually, by this marvellous piece of logic of a BJP spokerperson from that area:

If he eats beef, then Congress workers will eat dog, fox and so on to appease him and get the posts of chairmen of boards and corporations.

Wow. Should we call this Noah’s Slippery Slope?

 

Posted by Amit Varma on 03 November, 2015 in India | News | Politics | WTF


Kheema, Bheja, Politics

I was dining yesterday with some friends at the excellent Bombay Canteen, and I remarked at one point: ‘This kheema bheja ghotala is sub-par today. Too much kheema, not enough bheja.’

And Peter Griffin responded, ‘That’s the state of our political discourse today.’

Such it goes.

Posted by Amit Varma on 03 November, 2015 in India | Politics


Is Don Bradman Still Alive?

Reading Ram Guha’s excellent piece on Mahatma Gandhi’s attitude towards sport, I was struck by this sentence about Nelson Mandela:

Once, when a friend came to visit him in Robben Island, Mandela asked: “Is Don Bradman still alive?”

I found that incredibly poignant. It gave me a greater sense of Mandela’s sacrifice than a hundred essays could.

Posted by Amit Varma on 31 October, 2015 in Politics | Sport


Pipeline

Quote of the day:

Experience has shown that you can often do just fine being on the wrong side of history if you are on the right side of a pipeline.

—Garry Kasparov, Winter is Coming.

Posted by Amit Varma on 31 October, 2015 in Politics | QOTD


The Cure For Cancer

Rediff carries an interview with a BMC corporator, Parminder Bhamra, who is moving a proposal to “make gaumutra (cow urine) compulsory to clean hospitals in Mumbai.”

What is the reason you are moving this proposal to use cow urine in hospitals?

I feel not only hospitals, but gaumutra must be used everywhere. Diseases like cancer can be cured by gaumutra, so why not use it? You see, gaumutra kills all bacteria.

Do you want phenyl to be replaced with gaumutra?

I am saying we should respect sentiments.

What does your proposal in the Brihanmumbai Municipal Corporation say?

While phenyl is made of chemicals, this (gaumutra) is Ayurvedic, so it must be used.

You must note one thing here: this guy is from the Congress party, not from the BJP or a lunatic fringe outfit.

Will Congress corporators support you?

One hundred percent. Do you know the Congress party symbol was once the Cow and Calf? Other parties have captured our symbol. Originally it was our symbol.

Has the BJP then hijacked the cow from your party?

The BJP’s job is to hijack other people’s ideas. They don’t have their own brains. They only take other people’s ideas and move ahead. They have taken all the ideas of the Congress and some of the Janata Dal and moved ahead.

So you see, there isn’t just a party or a cultural organisation or a handful of fringe groups which believe in this whacko stuff. No, there is a significant constituency out there which thinks like this, and it is perceived to be so large that other political parties are also catering to it now. But is that perception correct? Is there any data on what people believe in this country? Does this man’s support for gaumutra really help his electoral prospects? Who’s got the numbers on all this?

One thing I can tell you for sure is that gaumutra isn’t ever going to cure cancer. Not the literal one; and not the cancer in our society either.

Posted by Amit Varma on 31 October, 2015 in India | News | Politics | WTF


Ban on the Menu Card

Rediff reports:

The Modi government, under fire for rising intolerance and violence related to eating beef, has allegedly disallowed permission for the airing of a documentary on beef-eating practices made by students of Tata Institute of Social Sciences.

The film titled “Caste on the Menu Card”, about the beef eating practices in Maharashtra, was to be screened on Saturday at the Jeevika Asia Livelihood Documentary Festival 2015, in Delhi. However, the makers of the movie say that they were informed by the organisers that they would need a censor certificate.

Firstly, you should note that this is not a protest by some ‘fringe elements’ within the RSS fold, but a decision by the government. So that whole approach of saying ‘Hey, we’re focusing on development, these are fringe elements, nothing to do with us’ won’t work here.

Secondly, you should also note that it was a Congress government that first introduced censorship in India, and over the years have been quite happy to ban books, films, plays and even music albums. So the fault really lies with us. We’ve been tolerating these assaults on free speech for way too long.

It’s never too late to start being intolerant of intolerance.

Oh, and here’s the trailer of the film in question. I don’t know if watching the full film will make me angry, but it is guaranteed to make me hungry.

Posted by Amit Varma on 30 October, 2015 in Arts and entertainment | Freedom | India | Politics


The Business of Politics

An article by TK Devasia in Scroll refers to the Communist Party of India (Marxist) as “the largest business house” in Kerala. We are told:

If the land in possession of the party and its feeder organizations is taken into consideration, the CPI(M) is the single largest owner of land in the land-scarce state.  Former Union Finance Minister P Chidamabaram estimated the asset of the CPI(M) in Kerala at Rs 4000 crores a few years ago. He had accused the working class party of driving away investors and using the opportunity to accumulate assets in the state.

The party that views capitalists as class enemies justifies the investments, saying that the workers had created them in order to strengthen the party’s fight against capitalists and monopolies.

The workers, indeed! Look, I don’t want to single out the CPI(M): every political party in this country is in the business of turning power into money, and then using the money to hold on to or gain more power. But it’s especially ironic in the case of the communists. Maybe they should change that parenthetical ‘M’ into ‘Money’ instead of ‘Marxist’?

Posted by Amit Varma on 29 October, 2015 in India | News | Politics


On Children

I have good news and I have bad news.

Good news: China has ended its one-child policy.

Bad news: Instead, China will now have a two-child policy.

This is surreal. Just when you thought, ‘Okay, maybe China gets it,’ you find that China doesn’t get it at all. If a one-child policy was bad, a two-child policy is also bad, because the thinking behind it is wrong. Firstly, contrary to what we taught in school, population is not something you need to control. People are a resource, not a problem. Putting an upper limit on people is literally like putting an upper limit on prosperity. We live in a positive-sum world, and on balance, every person brings more value to the world than they consume.

For more on this, read my essay, ‘The Evil of Family Planning’.

Secondly, the state doesn’t own the people that it decides what it should ‘allow’ them to do. But hey, am I so naive as to lecture China on individual rights? I have a better shot at provoking World Peace by singing bhajans at Wagah.

Posted by Amit Varma on 29 October, 2015 in Freedom | Politics


Uber Regulation

Abhinav Singh has a good post up about how the Government of Maharashtra is proposing to regulate Uber. As you’d expect, there are vested interests behind this: the existing taxi industry, which feels threatened by the new operators, as indeed they should, because the new operators are proving more value to consumers. So they go to the government.

As I’d written here, all interventions in the free market amount to a redistribution of wealth from the poor to the rich. Any regulations here will end up as exactly that. The value that consumers would have gained from the unhindered operation of Uber and Ola will be redistributed away to the older taxi operators. You really don’t need to ask what’s in this for the government, do you?

If this makes you angry, do go sign Uber’s petition. I’m usually skeptical of online petitions and candlelight vigils and so on, but this is a petition directly from one of the affected parties, and there is a non-zero probability that it will make a difference.

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An earlier piece on Uber: The Price is Right.

Posted by Amit Varma on 29 October, 2015 in Economics | Freedom | India | News | Politics


Cold Storage Unit

The Times of India reports:

It took the judiciary 24 years to declare that an air conditioner makes a room cool and does not turn it into a cold storage.

Read the full story. I don’t know what to be more outraged at: that our legal system took 24 years to rule that an AC does not turn a room into a cold storage unit; or at the kind of absurd rent seeking and/or extortion that goes on in this country. Both are actually so commonplace that I should save my outrage for something better, such as the unusual October humidity in Mumbai. I spend most of my day in a cold-storage unit, but still…

Posted by Amit Varma on 29 October, 2015 in India | News | Politics | WTF


The Fine Art of Being Besides the Point

Arun Shourie says that the current government is “Congress plus a cow.” The BJP responds by saying that Shourie is no longer a member of the BJP because apparently his membership expired and he forgot to renew it.

That’s the best you can come up with, BJP?

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Aside: I think if Rahul Gandhi joined the BJP, the average IQ in the party might actually go up. Narendra Modi has an HR problem, not a media problem.

Posted by Amit Varma on 27 October, 2015 in India | News | Politics | Small thoughts | WTF


‘Too Good’

Viswanathan Anand just drew his round one game against Anish Giri at the Bilbao Masters despite having an overwhelmingly superior position. Why couldn’t he win it? Here’s what Giri had to say:

I think the problem for my opponent was that his position was too good. He could afford to make absolutely any move, and he abused this fact.

I read that quote, and I immediately thought of the BJP and their comfortable majority in the Lok Sabha.

Posted by Amit Varma on 27 October, 2015 in India | Politics | Small thoughts | Sport


Excessive Coverage

WTF news of the day:

Maharashtra Rural Development minister Pankaja Munde today opined that media should not give “excessive” coverage to crime against women as it instills “energy” and “pleasure” among people with a criminal mindset to try “something new.”

Hmm. I have three things to say:

One: Munde is saying that she wants the media to only report good news because bad news, as per her reasoning here, perpetuates bad actions. This is a convenient position to take when her government is in power. Will she hold the same view when she is in the opposition? I hope someone asks her when that time does come.

Two: I wonder what is the source of her reasoning. What is the proof that the coverage of crimes inspires people to actually commit crimes? What is the study, where is the data? And if there is none, is her wisdom gleaned from years of observation? Who does she hang out with? From a sociological point of view, this is all most fascinating.

Three: There are news outlets that still use the word ‘opined.’ This, to me, is the real scandal in this report.

Posted by Amit Varma on 26 October, 2015 in India | Media | News | Politics | WTF


The Fatal Conceit of the Indian Politician

A shorter version of this was published as the 22nd installment of Lighthouse, my monthly column for BLink, a supplement of the Hindu Business Line.

‘I’m not conceited. Conceit is a fault and I have no faults.’ Imagine this quote on an internet meme, alongside a picture of Narendra Modi, looking dapper in that famous pinstripe suit, or maybe a trademark Modi kurta. It would surely get thousands of shares on social media, many from bhakts impressed by the prime minister’s modesty. Don’t rush to share it, though: as one tends to do on the internet, I just misattributed. Those words were not uttered by Modi, or even Oscar Wilde or GB Shaw. The man who said them is former Van Halen singer Dave Lee Roth, with his back against a record machine. But Modi could have said them, could he not?

Please don’t think I am picking on Narendrabhai alone. All politicians are vain. Indeed, one could argue that in politics, vanity is a feature and not a bug. Politicians come to power by selling specific narratives about their excellence; and they can sell it most effectively if they believe it themselves. Success in many fields often begins, comically and ironically, with self-delusion. But politicians have consequences, and there’s nothing comic about that.

One reason that India is still a poor country is the ‘fatal conceit’ of our founding fathers. Jawaharlal Nehru, and his minions and successors, believed that economies were best planned from the top down. An economy is a complex thing, the poor and ignorant masses of India surely could not be trusted to perform this task by themselves, and needed to be directed by wise and benevolent planners. Those who have studied economics or paid attention to history know that this was foolish and wrong.

Economies, like languages, are products of “human action but not human design,” in the words of Adam Ferguson. They function brilliantly on their own, with millions of individuals pursuing their self-interest, and thus increasing the value in the lives of others, for that is the only path to profit. Planning is not only not required, it is an impediment. A central planner can never get a grasp on the huge amount of dispersed knowledge in an economy, and any intervention is bound to lead to a loss in efficiency. This hurts the poor the most: as I illustrated in a previous column, every intervention in a free market amounts to a distribution of wealth from the poor to the rich.

Nehru suffered from a disease that Friedrich Hayek called the Fatal Conceit. His coining of that term was inspired by the following passage in Adam Smith’s The Theory of Moral Sentiments: “The man of system […] is apt to be very wise in his own conceit; and is often so enamoured with the supposed beauty of his own ideal plan of government, that he cannot suffer the smallest deviation from any part of it. He goes on to establish it completely and in all its parts, without any regard either to the great interests, or to the strong prejudices which may oppose it. He seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces upon a chess-board.”

People are not chess pieces, of course, and Nehru and his successors ravaged the economy with their well-intentioned interventions. I won’t recite the litany, but here’s the thing: 68 years after we became independent, 24 after the Soviet Union collapsed, we are still enslaved by a failed philosophy. And we’re still suffering because of the fatal conceit of flawed individuals.

It amuses me sometimes that Modi is considered a right-wing politician. He actually embodies the worst of both left and right. Like his party, and the ecosystem of religious nutjobs that sustains it, he is right-wing on social issues; and left on economic ones. Basically, he is against individual freedom in every domain possible, and thus the exact opposite of me. If you put Modi and me in a test tube, the resultant explosion could blow the earth off its orbit, or at least result in a good rap album. But that is a digression, and it is possible that you have your mouth open because I called him an economic leftist. Well, if a man is to be known by his actions and not his public image, what else can we call him?

I know many economic liberals, bald because of six decades of tearing their hair out, who thought Modi would be a free-market messiah. My ass. Tell me this: exactly what reforms has he carried out that increase our economic freedom? When Modi took over, India was ranked 140 out of 189 countries in the World Bank’s Ease of Doing Business Index: it has since slipped to 142. He has not reformed the labour laws that, for decades, have prevented us from being a manufacturing superpower. The license and inspector raj remains what it was under his predecessors. A litany of what he has not changed would be the same as a litany of what was wrong with our country before he took over.

I have friends in high places who tell me that the system doesn’t allow him to act. But the truth is that Modi suffers from the same fatal conceit that Nehru displayed. He believes the economy needs a top-down manager. He would rather reform a public sector unit than sell it off. When he talks of ‘minimum government and maximum governance,’ as that catchy slogan went, he is speaking of making government more efficient and not at eliminating it entirely from areas where it has no business existing.

His conceit isn’t limited to his economic thinking, though. Look at how the man struts! He may not walk the walk in the sense of governance, but he certainly does in a catwalk sense. Once he was denied a US Visa; now he travels the world meeting the high and mighty. I wonder if he realises, though, that these global leaders give him importance because of the position he occupies, and not the man he is. I suspect he has actually drunk his Kool Aid, and believes the Modi Wave narrative of the last elections. He may be headed for a fall if so.

Look at the numbers from the 2014 general elections again. Our first-past-the-post system made it seem like a wipeout, as the BJP got 6.4 times the seats that Congress did. But they got just 1.6 the vote share of the Congress. It was 31% to 19%, and a 4% swing away from them next time could easily result in a hung parliament. They delivered outlier performances in states like UP, MP and Gujarat, which seem statistically impossible to repeat. And the following things are certain: Since the election, they have not won more supporters than they have lost; the turnout of their supporters is bound to be less the next time around; other parties, clear about what they are up against, will make smarter coalitions to consolidate the non-BJP vote; anti-incumbency will be a factor now that some of the Modi sheen is gone.

Modi behaves like the prime ministership was his destiny and he will win again easily in 2019. But if he doesn’t get his act together, reforming the economy and constraining the lunatic fringe in his party, he could be in for a surprise. India could choose another delusional politician over him, and 2014-2019 could be remembered as The Selfie Years.

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Also read: ‘Lessons From 1975.’

Posted by Amit Varma on 16 October, 2015 in Economics | Essays and Op-Eds | Freedom | India | Lighthouse | Politics


Lessons From 1975

A shorter version of this was published as the 21st installment of Lighthouse, my monthly column for BLink, a supplement of the Hindu Business Line.

In 1975, a Tamilian dressed as a sardar landed up in Ahmedabad Railway Station, in disguise to escape the might of the central government, for whom he was a wanted man. He was met there, and escorted to a safe house, by a 25-year-old who had once sold tea on the platform of that station. Freeze that moment in history – Narendra Modi escorting Subramanian Swamy to his safe house – and contrast it to today. What a long way we have come.

Or have we?

I got the above trivia from Coomi Kapoor’s excellent book, The Emergency: A Personal History. Kapoor was a journalist living in Delhi in those days, and though her book was timed to coincide with the 40th anniversary of the Emergency, it is anyway a timely reminder of the damage that people drunk on power can do, and the threat that such untrammelled power can pose to a nation.

The Emergency began with the filling up of jails. “The number of those in Indira Gandhi’s prisons during the Emergency,” writes Kapoor, “far exceeded the total number jailed during the 1942 Quit India Movement.” This included not just opponents in the opposition parties but also potential ones within her own party plus whoever they damn well felt like. (“The entire Sanskrit department of Delhi University was sent to prison.”) Personal vendettas were quickly settled, and torture was common in the jails. Those close to power were more like despotic rulers than public servants. For example, Kapoor writes, “When an old and respected lawyer of Panipat denounced [Bansi] Lal’s corrupt rule, he was arrested and stripped naked, his face was tarred, and he was dragged all through the streets of the town.” Such behaviour was more rule than exception.

The exploits of Sanjay Gandhi and his coterie were particularly shameful. He wrongly believed that India’s population was a problem rather than a resource, and even more wrongly set about solving it through forced sterilisations. Millions of those took place, and the story of the village of Pipli is particularly illustrative of how they functioned. Hawa Singh, a widower, died there after a botched forced sterilisation, and the villagers refused to have anything more to do with family planning. On hearing that, the government sent “several hundred policemen” who “took up positions around the village.” Shots were fired, and “two women making cowdung cakes outside their huts were mowed down by the bullets.” The men surrendered, and hundreds of them were sterilized.

The press was silenced. Loren Jenkins of Newsweek wrote, “In 10 years of covering the world from Franco’s Spain to Mao’s China, I have never encountered such stringent and all encompassing censorship.” One of the leaders of the opposition, LK Advani, later said that the press “was asked to bend and it chose to crawl.” A permanent (and brutal) dictatorship seemed likely, and we owe much gratitude to the fact that power had made Indira delusional, for she actually called for elections only because she thought she would win. Had she not thought so, she would not have called for them. (Indeed, Sanjay was opposed to the decision.)

To be honest, a political leader does not need to suspend democracy to devastate a country. Even without the Emergency, the vile Indira Gandhi would count as one of the worst leaders in our history. Through a series of disastrous economic policies, many of which her deluded partymen still support, she kept tens of millions of people in poverty, and adversely affected all our lives. There are no counterfactuals, of course, and abstract economic arguments do not have the visceral impact of the kind of stories that Coomi Kapoor’s excellent book is filled with.

Let’s get back to the present. To many, the general elections of last year felt like a landmark event because Modi’s win seemed to mark a final, clean break from everything that post-Independence Congress stood for. However, Modi was not brought to power by a monolithic votebank, but by a collection of disparate groups, all of whom were desperate for change for different reasons. Modi was like a Rorschach test – he stood for whatever you wanted him to stand for, and what you saw in him revealed more about you than about him. Hindutva bhakts saw him as the former RSS pracharak who would finally make India a great Hindu nation; economic liberals saw him as the leader who would finally liberate India from the Leftist policies that had kept us backward all these years; and so on. Some of the expectations from him were contradictory; most were impractical, given the constraints of the way our political economy is structured. But Modi encouraged all of them by discouraging none of them. He didn’t say much on policy issues, stuck to safe bromides, and you never really knew to what extent he supported Hindutva or free markets or yada yada yada. He was strong and silent, and he remained strong partly because he remained silent. You could believe whatever you wanted about him – and because the existing government was so incompetent, you wanted to believe.

If campaigning was like courtship, governance is like marriage. You can’t be delusional about the object of your affection any more: you’re living with the fellow. And while it’s okay if he burps and farts in your presence, it is simply not okay if he beats you up just like the previous guy used to. So a year down the line, how is the Modi government doing?

If you’re an economic liberal like me, Modi has been a disappointment. It is with good reason that people are beginning to refer to this government as UPA 3. Modi has not instituted any far reaching reforms, and the rhetoric of ‘incremental reforms’ does not cut it for me. If a man has gangrene in his legs or cancer in his liver, you do not give him an aspirin and call it incremental reform. ‘Gangrene’ and ‘cancer’ do not need to be managed efficiently, but eliminated brutally. Anyway, this is a subject I’ll elaborate on a future column. For now, I will concede this: Modi’s government is no worse than UPA 2 was. And it’s fair enough to wait out the five years they have been given before passing judgement.

It is in the domain of personal freedoms, though, that Modi has let the country down. Much of this is due to petty vindinctiveness, straight out of the Indira Gandhi playbook. Consider how Teesta Setalvad has been harassed after Modi came to power, with the latest salvo being the cancellation of the license of her NGO. (Why should any organisation need a license from the government anyway? Wasn’t Modi the Messiah supposed to do away with this kind of nonsense?)  Consider the government’s harassment of NGOs like Greenpeace, and the offloading of Greenpeace campaigner Priya Pillai when she was on her way to England because officials felt she would give India a “negative image” there. Go online, search for videos of the recent Patel uprising in Ahmedabad, and see the brutality with which the police crack down on common citizens. (The Gujarat government also banned the mobile internet during this time, as well as Facebook, Twitter and WhatsApp.) Consider all the nonsense the fringe elements on the Hindu right are getting up to, and the silence of the government on these issues – the same silence you would get from Indira very time she was confronted about the antics of her psychopathic son Sanjay.

Modi has not declared Emergency or jailed his opponents, but this approach to power does remind me of 1975, and make me wonder. Many of the prominent political actors of today played small roles in that particular production. Arun Jaitley spent the years of the Emergency in jail. In the hundreds of hours of solitary contemplation that he no doubt had, what did he think about? When the young party worker Narendra Modi guided Subramanian Swamy to his safe house, what did they talk about? Was it about how power always corrupts, the necessity to impose limits on it and the tragedy that politicians in India sought to rule rather than serve? Or did they simply say to each other, “Just wait. Just wait till we are on the other side, and we are the ones in charge.”

I suspect it was the latter. And what a loss that is.

Posted by Amit Varma on 18 September, 2015 in Essays and Op-Eds | Freedom | India | Lighthouse | Politics


Profit = Philanthropy

This is the 20th installment of Lighthouse, my monthly column for BLink, a supplement of the Hindu Business Line.

Never talk to me about profit,’ Jawaharlal Nehru once said to an industrialist friend of his. ‘It is a dirty word.’

Nehru’s sentiments were understandable in those times, and his sentiments were noble. India had just rid itself of the British, who had come to India ostensibly to do business and had left it impoverished. Nehru, who had played a notable role in the freedom struggle, had spent his formative years in England learning from the Fabian Socialists, as well as from Howard Laski, the Marxist professor at LSE who had a greater influence on modern India than Mahatma Gandhi, through students such as Nehru and VK Krishna Menon. The Soviet Union seemed to be a model to admire, America itself vastly expanded the role of the state after the Great Depression, and the top-down command-and-control economy must have seemed incredibly attractive to Nehru. The center had to hold. The profit motive was evil. Those exploitative capitalists had to be kept in check.

It is not fair to judge Nehru in hindsight, and he was right about other things that mattered. But he was wrong about this. Profit is the secret behind all prosperity. And it is a distrust of the profit motive that has kept this country poor.

The fundamental fallacy that Nehru committed was of looking at the economy as a zero-sum game. By that thinking, if someone is winning, someone else must be losing. If the industrialist makes a profit, someone else is getting exploited. But this is not the way the world works. All trade is a positive-sum game; and indeed, it is not possible for one person alone to make a profit in a transaction.

I am fond of illustrating this by citing what the writer John Stossel calls the Double Thank-You Moment. When you buy a cup of coffee at a Cafe Coffee Day, you say ‘thank you’ when you are handed your cup of coffee. And the cashier says ‘thank you’ when you hand over your money. This double ‘thank-you’ illustrates that both of you benefited from the transaction. Both of you profited.

This is, simply put, the root cause of prosperity. Every single voluntary transaction that takes place makes both parties better off, and increases the sum total of value in the world. Equally, every impediment that anyone places on the ability of consenting adults to trade freely with each other reduces the notional value in the world, and is an impediment to growth. It stands to reason, then, that trade should lead to prosperity, and that economic freedom should be correlated with a nation’s wealth. Does the data bear this out? You bet it does.

First up, I urge you to consider this chart. (Here’s the source.) It shows the wealth of the world as a flat line for centuries, until 1800. And then, boom, the world economy takes off in a spurt that economists call the Hockey Stick of Human Prosperity. It correlates perfectly with the explosion of markets across the world, of double-thank-you moments.

But it doesn’t take off uniformly across countries. Free markets are a necessary condition for prosperity, so let me now draw your attention to another chart. This one, from the Index of Economic Freedom 2015 brought out by the Heritage Foundations, shows a clear correlation between economic freedom and the wealth of nations. The freer you are, the wealthier you tend to be. (Also, the freer you are, the faster you grow.)

Forget the data, you say. Capitalists are exploitative. What about the low wages paid by Walmart? What about sweat shops run by large multinationals in third world countries like Bangladesh, where workers toil jn inhumane conditions? Isn’t that the profit motive at work?

Yes, it is. And I deeply admire Walmart and every company that runs a sweatshop in a poor country. That is because the people who work in Walmart and in those sweatshops do so because it is the best option open to them. They are not fools. They are choosing to work where they do because they deem all other alternatives to be worse, and those evil capitalist behemoths should actually be thanked for actually providing them an option that is better than the best option otherwise available to them. We condescend to those workers when we say they are being exploited. (Indeed, it is possible that we are exploiting them by using them to feed our sanctimony.)

This doesn’t apply to slavery and trafficking, of course, for by free markets I mean markets where consenting adults trade freely under the rule of law. Also, let us not conflate rent-seeking and profit-seeking. Many large companies get together with government to put restrictions on markets so that their market share is protected from competition. Such protectionism hurts the common consumer, and amounts to a redistribution of wealth from the poor at large to rich special-interest groups. Big companies are often the biggest enemies of free markets, and capitalism often unfairly gets a bad name because it is confused with crony capitalism – or ‘crapitalism’ as some call it.

To sum up, the profit motive is not something nefarious, but is actually noble. You can only profit in a free market by improving someone else’s life. And the more you profit, the greater the good you do in the world, the more the value you create. Profit, indeed, is the purest form of philanthropy.

I must admit here the very slight, teeny-weeny possibility that I am being unjust to Nehru. Maybe he had a mischievous glint in his eye when he said that profit was a ‘dirty word’. I can imagine him sidling up to Edwina Mountbatten at a party, gently putting his hand on her waist, and whispering to her, ‘Edwina, my dear, would you like to, ahem, profit with me?’ That certainly could have led to a double thank-you moment.

Posted by Amit Varma on 28 August, 2015 in Economics | Freedom | India | Lighthouse | Politics


The Great Redistribution

This is the 19th installment of Lighthouse, my monthly column for BLink, a supplement of the Hindu Business Line.

India is a poor country. We were poor when we became Independent in 1947, and while other countries have lifted themselves to wealth in that much time, we’re still poor. And government policies are the reason for our continuing poverty. For the last 68 years, since a group of white-skinned rulers handed over power to a bunch of brown-skinned rulers, all the governments that have run India have done one thing incredibly effectively: they have redistributed wealth from the poor to the rich.

Yes, you read that right: I’m not talking about redistribution from the rich to the poor, which itself would be an ineffective way of fighting poverty, but from the poor to the rich. They have taken money from the poor in our country and given it to the rich, and, as if to troll us, they have done this in the name of fighting poverty. For that reason, while there are some very rich people in our country, on average, as our GDP-per-capita indicates, we’re still a third-world country.

Let me take a recent event to illustrate what I mean. A few weeks ago, the central government announced that it would not allow foreign direct investment in retail e-commerce. Business Standard reported: ‘Minister of State for Commerce and Industry Nirmala Sitharaman last month met executives of Flipkart and Snapdeal and representatives from the Confederation of Indian Industry (CII) and the Federation of Indian Chambers of Commerce and Industry (Ficci) to assess the impact of FDI on Indian e-commerce companies.’ The government then decided that it needed to protect the local players, and therefore did not allow FDI.

Do you see what happened here? Who benefits from competition? The consumers do. The greater the competition, the more value for money the common consumer gets. This is axiomatic. Our local retailers—all the people consulted by the ministers—were scared that their bottomline would be affected by this competition, so they successfully petitioned the government to block it. The result: the consumers will get less value than they otherwise would; the local retailers will make more money than if competition was allowed. In effect, it is a transfer of wealth from a large, dispersed group of consumers to a small, relatively wealthy interest group.

All tariffs have exactly this effect. Let’s say I like to buy widgets. Local manufacturers sell me widgets for Rs 100 each. Foreign manufacturers, for a variety of reasons from technology to labour, can sell me widgets for Rs 80. But the local manufacturers petition the government to put a tariff on imports, and the government puts a Rs. 30-per-widget tariff on the foreigners, so they don’t bother coming over. The net result: each of us loses a notional Rs 20. Who gets that money? The local manufacturers. What just happened? The government redistributed wealth from the relatively poor masses to a specific relatively rich interest group.

Governments that impose or continue tariffs will do so in the name of protecting the domestic industry. But at whose cost? The French economist Frédéric Bastiat once wrote a great essay called ‘What is Seen and What is Not Seen’, which speaks of the hidden effects of such actions. What is seen here is the good done to one specific group of people (with money usurped from a poorer group, which by itself is surely morally wrong). What is not seen is what the consumers would have done with that money. They would have spent it or invested it, and it would have gone back into the economy, creating growth and employment. But the potential beneficiaries of that are not even aware of what didn’t happen.

Subsidies are also redistribution of the reverse-Robin Hood kind, if in a more obvious way. The wealth taken from the poor is not in terms of marketplace prices or value for money, but is taken directly from your taxes. And while the poor may not file income tax returns, they pay taxes too. Every time your maidservant buys a bag of salt or the beggar at the nearby traffic signal buys soap, they are contributing to the Rich Interest Group Benefit Fund. This is not just poor economics –  it is morally wrong.

Here’s the upshot: All interventions in free markets amount to a redistribution of wealth from the poor to the rich. Anything that reduces competition or artificially raises costs for the consumers amounts to just this. Restrictions on FDI, tariffs, licensing processes or regulations that make it harder to open a business or to run it, subsidies; and so on. The interest groups to benefit may differ in each case, and will often include rent-seeking forces within the government, but always, without exception, the wealth will flow, in relative terms, from the poor to the rich.

So why don’t we protest, you ask, given that we are a democracy? Well, think about the winners and the losers here. The costs of such redistribution are dispersed among more than a billion of us, and the benefits are concentrated to a few. If Rs 2 from the taxes you paid last year went as a subsidy to the widget industry, you won’t even know or care. The widget industry, making millions from the accumulated Rs 2s, will care, and will lobby aggressively, contribute to party coffers, buy off politicians and bureaucrats – whatever it takes. That is why government policy is not dictated by the people at large, but by the aggressive lobbying of hundreds of interest groups, out to make a killing at the expense of the poor. That is why government grows and grows, and so many constraints are placed on the only force that can make us wealthy: economic freedom.

Posted by Amit Varma on 17 July, 2015 in Economics | Essays and Op-Eds | Freedom | India | Lighthouse | Politics


An Economic Message from God

The editors of Okonomos, the economics journal of the Hansraj College in Delhi, asked me to write a guest article for the current issue of their magazine. Here it is.

Imagine one day God comes down to Earth. He’s an old man with a beard, hanging out in the clouds, and he latches onto the wing of a plane and sits there, cross-legged, until the flight lands. A communist man who took a reclining-emergency-row window seat for the legroom has to be taken off the plane on a stretcher, for he faints after seeing 1), a gentleman who is obviously God on the wing of the plane, and 2), the T-shirt God is wearing, which says, in fluorescent pink letters, ‘Free Markets Rule.’

God is instantly met by waiting paparazzi, and an impromptu press conference is convened. ‘Oh God,’ says an overwhelmed young lady, who appears to be on the brink of orgasm, or something equally divine, ‘Oh God, please tell us: why that T-shirt?’

‘I was hoping someone would ask me that,’ says God. ‘Or rather, I made you ask me that. This is why I have come down here. You should know that I’m a bit of an efficiency buff.  I made the universe, and then the earth, and then amoeba and fish and monkeys and all you folk, but the thing is, I was not much into micro-management. The universe is full of tons of shit, and fine-tuning every small aspect of each creation would take eternity. And while I do have that much time, why sweat the small stuff, so I decided to just put systems in place and take a nap.

‘When I went to sleep, there was primordial ooze. I put natural selection in place, and as I slept, evolution happened. I knew that something like you humans would eventually evolve, though I must confess I couldn’t have anticipated Honey Singh or Kim Kardashian. Wtf , really? Anyway, I put systems in place for you folk too, so you could reach reach your optimum levels as a species, in the pursuit of happiness. But when I wake up I find, hey, what’s going on here, the most beautiful, elegant aspect of my creation, which was meant to help you reach fulfilment, is being maligned. I’m talkin’ about free markets. So here I am, to put the record straight, and to set you on the right track as a species. So listen up carefully, because I won’t be back to repeat this: I have to rush after this to North-West Andromeda, and I could take quite a while there, a black hole has been acting up, keeps spitting galaxies out, wtf?’

‘Oh God,’ says the young lady we have already met, on the verge of rapture. ‘Tell us everything. Oh God!’

‘Right,’ says God. ‘Listen up, here come some basic truths about economics that are really just common sense, but you may consider them divine revelation if you wish.

One: Life is a Positive Sum game. Every time two people make a trade, they do so because both of them benefit. One of my blessed children, John Stossel, illustrated this by coining a phrase, ‘Double Thank You Moment.’ You buy a cup of coffee, and as you pay for it and take the cup, you say to the guy behind the counter, ‘Thank you,’ and he says the same thing to you. Two Thank Yous! And indeed, in every single transaction that takes place across the world, both people benefit, or they wouldn’t have entered into that transaction. This is how productivity goes up, how the amount of value in the world rises, how societies grow prosperous. For my sake, think about how drastic progress has been since the 18th century, when free markets started becoming common. Look at the two Koreas, identical once upon a time, and now so different because of the different paths they chose. And listen up, listen up, to what I say next:

‘Since every trade leads to both parties benefiting and value being created in the world, anyone who comes in the way of free trade anywhere is sinning. Yes, you heard me, it is a sin to get in the way of free enterprise. Tariffs and duties are evil, and regulations and license rajs are man’s way of trying to play God. Don’t you dare!

Two: Business is better than charity. Given what I told you above, how does a human being make money? Only by increasing the value in the lives of other people. Put another way, you can only enrich yourself by enriching others. That is exactly what business is. You make money by giving people what they want. The more value you create for others, the more value you create for yourself. Thus, it’s nonsensical to speak of a system where the rich get richer and the poor get poorer. In a free market, that’s not possible. The rich can only get richer if the poor also get richer.

‘And this is why I consider businesses better than charities. Both aim to help others, but the survival of businesses depends on their ability to do so, and I like those incentives better.

Three: Money Trickles Up, Not Down. No respectable economist has ever spoken of trickle-down economics. There is no such thing. It is a straw man. (You are all like straw to me, but never mind that.) In a free market, money trickles up, not down. In a business, it is the suppliers and the workers who get paid first, and the consumers who get served, and only then, right at the end, do the owners make any money. They are at the end of the chain. Ask anyone you know who runs a business how it works.

Four: Capitalists are among the biggest enemies of capitalism. Raghuram Rajan, a man I created in my own image (aren’t I handsome?), once co-wrote a book titled ‘Saving Capitalism from the Capitalists.’ Note that sentiment. People often think that defenders of free markets are defending the actions of evil capitalists and big businesses gaming the system. Wrong. Established capitalists are the ones who have the most to fear from competition, and they are the ones who lobby governments to manipulate markets in their favour. To take an example, look at India. When India gained Independence, a group of its top businessmen came up with something called the Bombay Plan, which was their vision of what the economy should be like. They wanted an interventionist state, with plenty of regulation and many curbs placed on free enterprise. Historians have presented this in support of the argument that hey, even capitalists wanted unfree markets, so free markets can’t be all that great, right? But think about it: of course the entrenched businesses would want government to keep out competition. Like, duh!

‘So beware of crony capitalists and the governments they partner with. And every time a new regulation or tax or tariff is introduced, consider who it is likely to benefit.

Five: Government is a false God. If offends me when people have blind faith in entities other than me. Like government. Governments came into being to serve the people and protect their rights, but instead, have ended up ruling the people and infringing their rights. Think about it, if any individual or group of people forced you to pay a third of your income every year to them, which effectively meant you were enslaved to them till April every year, you’d be pissed, and would correctly call them thieves. If they regulated all your activities, curtailed your freedom even when you were causing no harm to others, and took a cut of all your purchases, you’d feel that a mafia was running your life. But when an entity called government does all this, and sanctimoniously tells you that this is for your own good, and it’s your duty to obey it, you somehow accept it. And furthermore, you expect it to be the solution to all your problems, even when the biggest problems around you are caused by government itself. What a con job!

‘The biggest force in human progress over the last few centuries has been free enterprise. And the biggest enemy of free enterprise – indeed, a sinner in my books – is government. And yet, you worship this false God, while forgetting all about me and the beautiful, natural system I put in place for you, tailored perfectly to human nature. So here’s a commandment for you: Embrace freedom – and question everything that your governments do.’

God stops here, and the young lady we mentioned earlier takes advantage of the lull to shoot a quick selfie with Him. As soon as she clicks the button on her cellphone, God, having delivered His message, disappears. The communist man of the reclining-emergency-row disappears with him. And far away, in North-West Andromeda, an alumnus of JNU is hurled into a black hole and is promptly hurled back out, for it is a universal truth that all transactions should be voluntary.

Posted by Amit Varma on 25 February, 2015 in Economics | Essays and Op-Eds | India | Politics


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