tag:blogger.com,1999:blog-5043138489010794057.post3921981724338075290..comments2024-03-27T15:57:09.192+05:30Comments on Urbanomics: Auditors and policy populismUrbanomicshttp://www.blogger.com/profile/16956198290294771298noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-5043138489010794057.post-49368096195720240072012-11-15T15:24:47.265+05:302012-11-15T15:24:47.265+05:30gulzar... food for thoughts... yes there are many ...gulzar... food for thoughts... yes there are many things ..we discussed in Hyderabad during training also ... mental castration of beaurocrat by politicians, over enthusiastic \ngos, malign seniors and dubious social activists hv come together .... \india need freedom againatulhttps://www.blogger.com/profile/00716077701519176127noreply@blogger.comtag:blogger.com,1999:blog-5043138489010794057.post-83396297688901742222012-06-19T11:30:27.480+05:302012-06-19T11:30:27.480+05:30First, I would like to thank KP for those comments...First, I would like to thank KP for those comments on Gulzar's post. I am sure most independent public would feel the same that the increased public scrutiny and responsibility are hardly too constraining to paralyze the political and bureaucratic decision making process.<br /><br />Also, it is hard to believe that in the current system, well-thinking bureaucrats have the independence and latitude to offer optimal solutions to business problems that balance public good and private profit. From my own observations in relation to the state of AP, it is obvious that ruling politicians have the first and final say in most policy making processes. Take the case of most recent revised liquor policy that has shifted from auctioning to lottery. In both the cases, the interests of liquor mafia (the political and low-level bureaucratic nexus) are well protected at the cost of public welfare and windfall gains to a few.<br /><br />DCF models offer good metrics of PV in a transparent fashion. Though the policy makers are not required to see scarce public resources as sources of govt revenues, the quantification of commercial value of projects that utilize public resources can provide a reasonable basis for resource pricing that balances private and public interest. In cases where a substantial leeway was given to certain private parties, a quantified value of intangible/indirect public benefits of such decisions can come in handy in substantiating such decisions.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5043138489010794057.post-39427905985527338362012-06-18T22:07:55.025+05:302012-06-18T22:07:55.025+05:30Thanks KP for those remarks. I agree with many of ...Thanks KP for those remarks. I agree with many of the points raised. I do agree with the need to squarely address the emergence of crony capitalism in allotment of public resources. but i do not believe that simplistic audit based assessments, which almost completely exclude all other factors, is the way to address that problem.<br /><br />the reference in the quote to the manner in which 2G spectrum prices were fixed betrays the play-safe policy-making attitude which is increasingly prevalent in Delhi and state capitals. <br /><br />we need to realize that any major policy decision is a judgement call, which invariably involves benefiting some group or businesses. this is all the more so when such decisions involve policies relating to sunrise sectors and path-breaking initiatives. there are strong risks associated with such decisions, both by way of failures and successes (disproportionate private gains). in government such policies are invariably initiated by some bureaucrat, widely discussed, and then decided upon. given the mechanistic DCF-based assessments of a populist (and this is the problem) auditor and the presumption of being immediately branded as having sold out to private interests, it is no surprise that even honest and proactive bureaucrats are thinking twice before putting their judgement calls on files.<br /><br />and in sectors like infrastructure, involving policies to attract private investments, the risks of judgement calls which do not pass the "populist auditor and media trial" test are considerable.<br /><br />and i am not speculating here. I am only reflecting widespread similar sentiments across the bureacratic spectrum in delhi and states.Urbanomicshttps://www.blogger.com/profile/16956198290294771298noreply@blogger.comtag:blogger.com,1999:blog-5043138489010794057.post-14844297624085806392012-06-18T15:58:10.827+05:302012-06-18T15:58:10.827+05:30...continuing
If it is the case that politicians......continuing <br /><br />If it is the case that politicians and bureaucrats are being victimized for no fault of theirs other than attempting to maximize public good - then I think there is sufficient space for a politician / bureaucrat to step up and make the case.<br /><br />I found an interesting view of 'policy paralysis' recently, which is closer to how I personally feel.<br /><br />https://www.vccircle.com/byinvitation/2012/06/11/economic-woes-not-due-policy-paralysis-alone<br /><br />"If the Competition Commission continues its crusade against abuse of dominant positions by market leaders in industries from real estate to cement to sugar to LPG cylinders, this should help improve economic efficiency. If the CAG continues its practice of scrutinising public spending and regulatory decisions in the manner that it has over the past two years, it will revolutionise the way the Indian Government works. Without such interventions from well meaning regulators and from a powerful judiciary, India could go the way of numerous “banana republics” in Latin America and Africa."<br /><br />Our treatment of tribals and indigenous people - outside the radar of the urban midde class / elite has been less than commendable - and the belief that poor compensation / eviction / resettlement without the slightest concern for their well being is the acceptable cost of development has never been challenged, like it is being now. That may explain the shift in policies being advocated (on paper) - it is a response to militant activism and has exposed our huge democratic failing. <br /><br />Why the entire Indian economy is paralysed because of disallowing FDI in retail, beats me.<br /> <br />Why an honest bureaucrat feels victimized is not so apparent to me, not in the way it is being connected to 'good' decision making. We are not running kangaroo courts, If anything the inability to efficiently prosecute corrupt pols and bureaucrats is the systemic issue.<br /><br />Why a politician feels stymied by having to be pragmatic - is not evident.<br /><br />Policy populism has always been our weakness, but while that may explain part of the problem - letting private players arbitrage off the commons with no value addition is also not the solution to ramping up investor interest.<br /><br />Why reforms as articulated by politicians is always about FDI ( and in retail) and never about governance is the bigger question.<br /><br />From an LSE, IDEAS report on Corruption in India<br />http://www2.lse.ac.uk/IDEAS/publications/reports/pdf/SR010/sanchez.pdf<br /><br />"First, the state needs to address the substantial legislative failings surrounding the pursuit of judicial and political corruption, which presently grant public officials inexplicable immunity from prosecution in a bewildering array of contexts"<br /><br />Or as The Economist stated in "Farewell to Incredible India"<br />http://www.economist.com/node/21556576?scode=3d26b0b17065c2cf29c06c010184c684<br /><br />"...two deeper political problems. First, the state machine has still not been modernised. It is neither capable of overcoming red tape and vested interests nor keen to relax its grip over the bits of the economy it still controls. The things that do work in India—a corruption-busting supreme court, the leading IT firms, a scheme to give electronic identities to all—are often independent of, or bypass, the decrepit state....Second, as the bureaucracy has degenerated, politics has fragmented." <br /><br />I see institutions like the CAG forcing a 'decrepit state' to confront its findings, not through the politics of demagoguery or appealing to emotion alone - but by building its credibility using its poitical capital wisely ( and should I add with integrity).<br /><br />If there is any larger crisis - it is one of political credibility across the board.<br />regards, KP.KPhttps://www.blogger.com/profile/06553866275918658507noreply@blogger.comtag:blogger.com,1999:blog-5043138489010794057.post-91617794864537805702012-06-18T15:42:33.905+05:302012-06-18T15:42:33.905+05:30Dear Gulzar,
Your column takes a nuanced position...Dear Gulzar,<br /><br />Your column takes a nuanced position between bureaucratically defined efficiency and the pragmatic response to market reality that needs to be bridged by politicians. <br /><br />However, interpreted narrowly it may add to the current chorus among politicians to lay the blame for 'policy paralysis' at the door of the CAG.<br /><br />Recently a senior minister of the GOI has blamed the choice of the CAG, and held the person responsible for the 'paralysis'.<br /><br />http://economictimes.indiatimes.com/news/politics/nation/govt-slow-on-reforms-must-take-bold-decisions-including-fdi-in-retail-says-sharad-pawar/articleshow/14107845.cms <br /><br />We can clearly see a pattern where the commons is sold-off cheap and then immediately re-sold at a large financial gain - clearly a political and bureaucratic nexus with unscruplous players.<br /><br />There is strong reason to believe that this paralysis could be strategic - waiting out time till the current focus on corruption and governance is diluted.<br /><br />While an audiors note is subject to (further) interpretation - windfall gains with no value addition clearly points to a corrupt dispensation - and while the legal strength of these observations are being argued in courts (through corruption cases, establishing a quid pro quo), to a layman whats going on is quite obvious.<br /><br />(contnued in part 2)<br /><br />regards, KPKPhttps://www.blogger.com/profile/06553866275918658507noreply@blogger.com