governance, political economy, institutional development and economic regulation

Posts tagged ‘France’

Babus as default tycoons

IAS 1

Our style of governance remains “provincial”. Of course nothing wrong in that. The French, despite being the last word in art, films, fashion and style – and now fighter planes – exult in the provincial core of their culture.

The dapper President Sarkozy first became a mayor of a charming French commune – through the simple expedient of marring the Mayors niece – before becoming President of France in 2007. No Indian politician worth his salt would spend a decade in district or municipal affairs, in the hope that this would further his political career.

In politics start at the top and stay there 

No sir, we graduate from student politics directly into the Parliament in Delhi, failing which, to the state level legislatures. Consider, that a Rajasthan dynast of the BJP, now says that he never wanted to be an MLA. But daddy – a BJP big shot from the Vajpayee years, couldn’t get him a ticket for the national elections, so he suffered in a job he was never interested in. He is now open to switch to another party, if he is assured a ticket for 2019.

Ditto that for the civil service

Oddly the government – read politicos – do not consider it strange that it forces bright young appointees to Indian Administrative Service to spend one third of their careers, initially, in the minutia of provincial affairs, “fire fighting” on a daily basis, to manage the perverse outcomes poor public policy, poor delegation, systemic failure or worse, outright corruption. Once their curious minds are suitably dulled and they approach an age, when their cohorts are big names already, in academics, management or technology, they are given a chance to come to Delhi to engage in policy formulation or the State capital to try their hand at program implementation.

It does not help that the existing system for recruitment allows candidates who are approaching middle age to join as a “young” recruit to the IAS. Worse, rather than spending the first decade of their service becoming specialists in their field of choice, these unfortunates become little more than the entitled flotsam of civil administration. They arrive half-baked “by administrative design” to head departments over the heads of existing personnel, who unfortunately were “a few marks short in the UPSC exam”.

Who gains from a plaint civil service?

All this is old hat. The real question is why do such perverse incentives continue to prevail? Who gains from it? Yes, lazy, incompetent IAS officers certainly gain from a system in which having once gamed the UPSC exam, they can sit back, smile at every powerful politician, adopt a tunnel vision on the nature their job, create no ripples and wait for good fortune to promote them faster through more vacancies at the top.

But one doubts that merely making life easy for IAS officers is the real incentive. After all, this elite tribe of around 6000 officers represents just 0.1 per cent (one tenth of one per cent) of the 6 million civilian public servants in administration. The real intent seems to be to keep them captive by never encouraging them to develop marketable talents.

A bureaucrat with “connections” is better than one with options

Professionals with international demand are a dodgy bunch. Remember Raghuram Rajan, Arvind Subramanian or even the Columbia professor, distinctly uncomfortable with real life public policy management – Arvind Panagriya. They found the marginal utility of hanging on, progressively reducing, so they left. A small number of babus also leave to go on to become successful entrepreneurs or professionals abroad or in India.

A bureaucrat with options is the last thing our politicians want. They like the humid stickiness of “relationships” developed over a life time. Such people are dependable. And politicians like bringing their sticky babu relationships along with them, as they grow in importance.

A glimmer of lateral competition at the very end of this government’s tenure

To its credit, the Modi government has, at the end of its five year term, initiated what will eventually become a scaled up lateral infusion of talent. Exposing bureaucrats to competition is the right way to go. But there is also a possibility that this mechanism may remain a subtle threat to ensure slavish, bureaucratic compliance, as is widely prevalent amongst the state level cadres of administrators.

Is it fair to crush bright young minds by stuffing their mouths with faux power

It is unfair that the potential of over 100 young IAS appointees, culled from the 500,000 who take the UPSC exam every year, is systematically degraded. Of course no one forces them to join. But where else can the child of ordinary parents get the chance to become an honoured part of the empowered Indian “elite”?  It is wrong to mould those who join for a three decade long career to become feared, often despised but always subservient members of one political dispensation or the other.

IAS 2

Early specialisation within narrow work verticals can enhance professional pride

Change the system. Cadres should be recruited on a narrow basis of skills and then trained for the public workplace. District administration, for example, is not just an incubation period. It should be a life time occupation. An IAS officer interested in district management should join as a Tahsildar and aim to retire as Chairman of the State Revenue Board. Others, who prefer secretarial services, must have the requisite sector skills (secretariat administration, public finance, industrial and commercial policy, agriculture etc.) join as a Section Officer and hope to retire as Secretary. Cross fertilization between the Union and state government secretariats could work. Most likely, those good at field jobs will be useless in the Secretariat and vice versa. In the modern world “general management” is what a spouse does at home every day. You don’t need to specialise as a generalist from day one.

Stop the contagion spreading through “caretaker” top appointments in private banks

Perhaps the most egregious cases of “provincial” type appointments are visible today in the financial sector. IDBI Bank earlier, Yes Bank and the venerable ICICI Bank are now headed by babus as Chair or Vice Chair. The storied ILFS (Infrastrucure Leasing & Financial Services) – a Non Banking Finance Company, which is, could, if it is not quickly sold to Orix, Japan (an existing minority shareholder with deep pockets), also soon be in “safe” babu hands – possibly one of the many IAS officers who have passed through its hallowed portals on deputation and contributed to its debt overhang.

Babus make excellent choices as a reliable pair of hands. The problem is they also make their organisation “safe” from all risk by bringing to the desk obsessive micro management. It is fine if such “senior age” management is inflicted on publicly owned entities. But why destroy the few private sector entities we have? They are in trouble because of indulgent “independent” directors, including pliant PSU nominee directors, who represented political not public interest and an RBI which failed, till recently, to proactively regulate errant management in privately owned, listed financial companies.

Private tycoons can be regulated, “babu” tycoons capture the regulator

James Crabtree in his breezily readable book – “The Raj Billionaires”, typifies top Indian business heads as “tycoons”- with the freedom to dream big on the back of implicit “relationship” based political support with nary a thought spared for minority shareholders. Simply, replacing a corporate tycoon with a babu hoping that things will become better is like mistakenly opening a fizzy wine and them trying to cap it for a rainy day – it goes flat. There are better ways of regulatory risk management than putting your “own man” in charge – that is an undesirable and inefficient “provincial” option, out of step with good governance practices.

Also available at TOI blogs September 25, 2018 https://blogs.timesofindia.indiatimes.com/opinion-india/babus-as-default-tycoons/

Paris Takeaway: One Culture Is Not a Quick Fix

Indian bus

(Photo Credit: www,m,inmagine.com)

For the French, “culture” is everything. It encompasses the language one speaks –French of course-; the food one eats-mildewed “blue” cheese; the wines one imbibes and the best of fashion. One Just has to compare the tres chic Christine Lagard-Managing Director of the International Monetary Fund with the practical, stodgy Mrs. Angela Merkel, Chancellor of Germany, to  visualize why France was so very different from the rest of Europe.

The idea of “one culture, one people” was peddled by France across its colonies, particularly in West and North Africa to create vast populations who, “in their heads”, were French, not African or Arab. Macaulay’s Minute (1835) did the same in India, except that British “Shepherd’s Pie and warm Beer doesn’t have quite the appeal as French cuisine.  No surprise then that in a cruel twist of fate Asian “curry” is the favorite British dish today. This would not have been possible in France.

French culture is emotively attractive. English has to be bit into-like a tough roast- to speak it but one has to swim languorously into French to speak it well. Listen to the French song “je t’aime”; a duet written by Serge Gainsbourg and immortalized by the Goddess of sensuousness- Brigitte Bardot in 1967. Compare this with the somber notes of Don McLean’s “And I love you so” and you will feel the difference between the cold Anglo Saxons and the emotive French.

The French, including the French co-optees- are a warm and loving people with their heads full of wooly, socialist ideals of Liberty, Equality and Fraternity. Of course all these ideals are bounded by a narrow regard for “French culture”. Take the case of dress codes. Muslims, who increasingly regard the “hijab” as an Islamic symbol, were not permitted to wear one in public. It is just as difficult to break through the French tradition of a large and inefficient public sector and taciturn trade unions- though we in India could give them a run for their money in this aspect.

Many nations, including the US and India, borrowed the ideals of the French Revolution 1789 but all applied them in a practical manner. Slogans like “we are all one World” sound great in a hippy hangout but are impossible to implement. End goals like Equality are just that. They define a glorious possibility but can never reflect the cruel, everyday reality of power hungry elites, patrimony and dissimilar endowments, as it exists everywhere in world.

The killings in Paris are being explained away as caused by religious, ethnic or economic cleavages. All of the above or any one of these could have been the immediate reason for the killings. But what they have laid bare is that the basic underlying assumption in France that one culture can laminate over all other cleavages is a lie.

A common culture is not enough of a glue to paper over the growing gaps between immigrants and insiders; white and the others; the Muslims (10% of the population) and the majority Christian faith; the educated and aspirational and the hopelessly poor and forgotten. Even Communist China has spectacularly failed in elevating the God of Communist Nationalism as a substitute for religion or ethnicity. This is despite the assistance of State machinery which is at its best in very heavy handed policing.  But a Common Culture is surely anathema alongside a belief in Liberty, Equality and Fraternity.

Our deepest sympathies are of course with the French for what has come to pass to their beautiful country. But no Indian can resist the deep sense of relief that despite our poverty; our widespread illiteracy; our linguistic, ethnic, cultural and religious heterogeneity we as Indians have hung together fairly well in relative terms.

This is not to say that minority rights are well protected in India. Nor do we hold that India has done well by its marginalized populations. But for a relatively new State and a less developed economy with deep rooted traditional cleavages, it is a remarkable achievement that we are bound ever tighter by our non-traditional beliefs in democracy; equity in access to public opportunities and freedom of choice in all aspects of life.

India has weathered violence more extreme, that seen in France recently, despite it being directly as viciously and specifically at a particular sect; religion or ethnicity. The reasons why we have managed to do so are ironical.

First, a weak State can be an asset. Unlike France we were never able to become a “Nanny State”. Every Indian knows that if she or her extended family does not look after themselves no one else will step in-least of all the State. This lack of an efficient, impersonalized, State provided social protection is cruel for the poor. But the consequential, pervasive, economic pressure of constantly working to make two ends meet keeps us on our toes. The desperation to keep working reduces the availability of idle human fodder to perpetrate the kind of terror in Paris.  The downside is the magnified roles local elites play in shaping opinion due to their economic and political clout.

Second, Indians happily accept that all 1240 million of us we are NOT one big happy family with a common culture. No Indian wants a common, Pan-Indian culture. Indians are used to living and working in an aggressively antagonistic, “non-localized environment”. The French in contrast are more molly coddled and less “internationalized” than us. 25% of Indians do not live in the place they were born and large scale migration is a fact. 2% of Indians live in foreign countries. We have assimilated and adapted to invaders, foreign conquerors and traders over the last 1000 years.

So let’s take heed of what has happened in France and the failure of the “one culture” project of the French. The world is too open; too complex and too integrated today for seeking “autarkic” options.

Culling our traditions to get options for the future is sensible but must have the caution that our greatest tradition has been of keeping our windows open, not tightly shut and making space for anyone wanting to clamber onto the “bus”, which is India.

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