Archive for the ‘Discussion’ Category

Beware viral enabling Acts: How the virus could lead to dictating governments..

March 31, 2020

Prof Jan-Werner Mueller of Princeton University in this piece:

Emergencies have two effects: in democratic states, they concentrate power in the executive. Leaders claiming new powers can usually count on citizens’ support. Even US President Donald Trump, whose performance has been disastrous from the start, is benefiting from a rally-around-the-flag dynamic.

The other effect is more obviously pernicious: in countries already threatened with what some social scientists are now calling “autocratization” (the reverse of democratization), leaders are using the COVID-19 crisis to do away with the remaining obstacles to their permanent rule.

Russian President Vladimir Putin is in the process of making himself president for life. Israeli Prime Minister Binyamin Netanyahu is weakening the Knesset and the courts. Hungarian Prime Minister Viktor Orbán, the pioneer of “autocratization” in the European Union, can now rule by decree, and wants to suspend elections and referenda and give the government the authority to jail journalists.

Plenty of authoritarians conjure up pseudo-crises; in a real one, they can take what look like perfectly justifiable measures to crack down on opponents. Anti-terrorism legislation enacted in the wake of the September 11, 2001, attacks on the US was routinely used to repress legitimate forms of political dissent.

What is the way out?

What can be done? In functioning democracies, parliaments and courts have to keep working. But if business and academia can shift online, there is no reason why these institutions cannot conduct “distance democracy.”

Parliaments – which have been losing power to executives anyway in recent decades – should accept selective rule by decree only for a strictly limited time, and only under circumstances in which rule by conventional law has significant drawbacks in dealing with the crisis. While rule by law, as opposed to decree, might be difficult when a vaccine must be found quickly, and resources must be deployed swiftly, there is absolutely no reason to suspend the rule of law itself (contrary to what prominent theorists of states of emergency, like the German jurist Carl Schmitt, long argued).

Most important, an opposition should support a government, but also offer alternatives, and, above all, hold a government strictly to account. It is often forgotten just how crucial it is for democracies properly to institutionalize the role of an opposition.

Mechanisms for doing this vary. They include a procedure enabling opposition leaders to reply immediately to ministers’ speeches, dramatize differences, and demonstrate an alternative; low thresholds for establishing committees of inquiry; opposition days, when an election’s losers set the parliament’s agenda; even installing opposition figures as the chairs of important committees (where much of the real work of parliaments gets done). A government is authorized to have its way, but, at all stages, an opposition must have its say.

New Zealand’s Prime Minister Jacinda Ardern has proposed a plausible solution in the face of the country’s lockdown and the temporary suspension of parliament. Rather than having a grand coalition or papering over all legitimate disagreement with the rhetoric of unconditional “national unity,” she has suggested a select committee chaired by the opposition leader, which can hold the government to account.

Hey Virus, show us humans some mercy. We are moving from one disaster to another….

Covid19: What would Roosevelt do? What would Keynes say?

March 23, 2020

Prof Pavlina R. Tchernev of Bard College in this Proj Synd piece wonders what would FDR do if faced with the Covid19 crisis?

The US government should pull out all the stops in mitigating the economic fallout from COVID-19, not just by disbursing cash to all households, but also by implementing a federal job guarantee and many other long-overdue policies. After all, for a self-financing government, money is no object.

Prof Robert Skiledesky asks What will Keynes say:
One hopes that governments will not have to choose between higher prices and increased taxes to finance efforts to combat the COVID-19 pandemic. But it’s not too early for policymakers to start thinking about how to pay for this particular war.
Mind is buzzing with all kinds of possibilities…

Comparing Covid19 to GFC 2008 is not approporiate..

March 20, 2020

Stephen Roach in this Proj Synd piece:


Post Yes Bank: Increasing concern for small private banks

March 18, 2020

This news in Mint on how deposits have declined in one of the small private sector banks in the last one week.

The moratorium on Yes Bank is going to be lifted today at 6 PM. On opening Yes Bank website, pop comes this message:

We will find out soon how good is this new foundation. One of the leading business TV journalists appeals to Yes bank depositors and not panic. Moody’s has also upgraded the bank by a notch which should provide some relief.

Indian banking gets murkier. Private bankers who once laughed at miseries of public sector bankers would be getting a taste of their own medicine now.

SARS: how a global epidemic was stopped

March 13, 2020

What times!

As we are trying to deal with the spread of Covid19, one often goes back to SARS. The virus broke out in China in Nov-2002 very similar to how Covid19 started as well and almost at the same time.

I came across this publication from WHO titled:  SARS: how a global epidemic was stopped. The entire publication is worth reading as it has contributions of several experts.

The last chapter by Brian Doberstyn points to some of the lessons:

  • Lesson 1: We were lucky this time
  • Lesson 2: Transparency is the best policy
  • Lesson 3: Public health is a serious business
  • Lesson 4: Human-rights issues must be attended to
  • Lesson 5: The media play a critical role in public health emergencies
  • Lesson 6: 21st century science played a relatively small role in controlling SARS; 19th-century techniques continued to prove their value (contact tracing, quarantine, and isolation)
  • Lesson 7: Partnerships worked, but the partners need to clarify and agree on their relative roles
  • Lesson 8: Modern modes of communication dramatically changed the way we work
  • Lesson 9: Clear travel guidance is needed
  • Lesson 10: Animal husbandry and marketing practices seriously affect human health
  • Lesson 11: Who should be on the front lines?
  • Lesson 12: With national disease surveillance systems in disrepair, informal avenues of reporting must be taken seriously
  • Lesson 13: Training and expertise in barrier nursing and hospital infection control are sadly deficient in the region

One could replace SARS with Covid19 in most part of the publication.

Lesson 1 in particular is worrying and also of hope:

The SARS virus could have become a constant threat to human health in the world we live in. It did not. Thanks to the intense and skilful efforts of the
governments of all affected areas, together with their regional and international partners, the virus was contained.

Certain characteristics of the SARS virus made containment possible. Infected individuals usually did not transmit the virus until several days after symptoms
began and were most infectious only by the tenth day or so of illness, when they develop severe symptoms. Therefore, effective isolation of patients was enough to control spread. If cases were infectious before symptoms appeared, or if asymptomatic cases transmitted the virus, the disease would have been much more difficult, perhaps even impossible, to control.

The chains of transmission could be broken at various points. The incubation period was relatively long (two to 10 days, with a median of five days), giving
more time for contacts to be traced and isolated before they fell ill and became infectious themselves. The incubation period also dictated how long contacts
had to be supervised. If the incubation period were longer, observation or quarantine would have been much more difficult to manage.

SARS being largely an urban disease, concentrated in relatively well-equipped hospitals, it was easier to detect cases and trace contacts, isolate patients, limit
infection, and therefore control the spread of the disease. Reporting was also more reliable.

We have obviously not learnt most of the lessons, particularly on animal husbandry. Shigeru Omi who encouraged others to contribute to the report int he introduction writes:

One way we can do that is to better understand why the SARS coronavirus and the avian influenza H5N1 virus crossed the species barrier from animals to
attack humans. What caused this strange migration? The explanation, in my view, lies in part in the way animals are raised for food in Asia, where increasing
prosperity has led to a greater demand for meat, and, in some cultures, a taste for the flesh of exotic animals.

In markets where wild animals are sold for the table, creatures that would never meet in their natural habitat are kept in proximity to one another, setting
the conditions for the emergence of new viruses. A similar threat lies in the way that chickens, ducks, and pigs are raised together, often in unhygienic conditions and usually with no barriers between them and humans. Such husbandry practices must change, or more viruses are likely to emerge from the animal world.

Exotic animals is a kind word for things like eating bats!

It was the first major disease which got amplified due to Passenger jets:

SARS was the first emerging disease of the age of globalization. I believe that, had it occurred in a time before mass international travel, it would probably
have remained a localized problem, with few consequences for global health. But the virus travelled around the world on passenger jets [see the account in
Chapter 15 of the consequences of one single flight between Hong Kong and Beijing], making it a true disease of the 21st century. To fight this 21st-century
disease, Member States applied 19th-century measures such as contact tracing, quarantine, and isolation. As old fashioned and labour intensive as they were,
these measures slowed the virus’s spread, and, in the end, contributed to its containment.

Of course this was true may be for jets. However, in the past flu travelled via ships.

Internet played a positive role:

But we also had a very modern ally: the Internet. Thousands of email messages flashed around the globe each day. Web pages not only kept the world informed daily, but also offered advice on scores of technical issues. At the same time, international laboratory experts set aside their traditional rivalries and grouped their expertise in a virtual network to decode the virus’s secrets. So successful was this unprecedented scientific cooperation that the causative agent, the coronavirus, was identified within weeks, whereas it might have taken months or possibly even years in the days before the Internet. 

Not sure what role internet has played this time. Mix of help and panic.

It is sad that humanity chooses to forget these big health crises and not learn.

Phew! Stay safe and quarantined..


Why so many epidemics originate in Asia and Africa?

March 11, 2020

Suresh V Kuchipudi, a virologist and associate director of the Animal Diagnostic Laboratory at Penn State University in this piece looks at the question.

He cites population explosion and unplanned urbanisation as key reasons. The urbanisation leads to deforestationand loss of habitat kills predators leading to population explosion for rodents.

Sweden’s Riksbank to test technical solution for the e-krona

February 26, 2020

Gradually Sweden is getting closer to e-krona:

The Riksbank is conducting a pilot project with Accenture aimed at developing a proposal for a technical solution for an e-krona. The objective is to create, in an isolated test environment, a digital krona that is simple and user-friendly. The technical solution will be based on Distributed Ledger Technology (DLT), often referred to as block-chain technology. The main aim of the pilot is for the Riksbank to increase its knowledge of central bank-issued digital krona.


The perils of digital health

February 18, 2020

As all the health monitoring instruments turn digital, they become a threat.

Mandeep Dhaliwal Director of the UN Development Programme’s HIV, Health and Development team writes on this digital mania:

Digital health is the buzz word that’s doing the rounds. Almost all hospitals are equipped with digital devices. The market is also flooded with such devices for personal use. That means, everything your body does – from your blood pressure and blood sugar levels to your heart rate and the number of steps you take – everything, EVERYTHING, is recorded onto digital devices. An aggregate of millions of such users from across the world makes for extraordinary data for companies that manufacture digital health devices and software.

But what if companies sell that data to, say, insurance companies? Would insurance companies offer higher premium rates to those who have blood pressure? Are they likely to sell this data to profit from it? What happens if such data are breached, and rogue elements get hold of it?

It’s needless to say that “digital health” devices bring enormous benefits – vis-a-vis efficiency, transparency and effectiveness. However, they pose considerable threats. 

This applies to all things digital.

Comrade Trump

February 17, 2020

Well who would have thought comrade word being used for a US President!

Prof Nina L. Khrushcheva of The New School in Proj Synd piece:

In 1922, Vladimir Lenin wrote that “Stalin concentrated in his hands enormous power, which he won’t be able to use responsibly,” owing to his rudeness, intolerance, and capriciousness – qualities that Donald Trump has in spades. His acquittal by the Senate was a dark day for American democracy, but his reelection could be lights out.

I am not claiming that Trump is the new Stalin, let alone equating today’s US to the Soviet Union of the 1930s. But I know propaganda when I hear it, and Trump’s words are nothing less than the genuine article. I also know how effective good propaganda can be in terms of creating space for dictatorial behavior – and how vulnerable even the strongest democracy can be to totalitarianism.

Of course, propaganda involves more than just words. Authoritarian rulers use other tools to cultivate an aura of greatness. Architecture is one such tool. From the Egyptian pharaohs to the Roman emperors to contemporary dictators like North Korea’s Kim Jong-un, authoritarian leaders have often used (or abused) architecture to manipulate public perceptions, by creating grandiose public spaces that reflect their splendid image of themselves.

Leni Riefenstahl’s controversial 1938 cinematic masterpiece Olympia, based on the 1936 Berlin Summer Olympics, was shot in a manner intended to emphasize the masculine, domineering air of the stadium – and, by extension, the Nazi regime. Then there was Albert Speer’s early 1930s makeover of Berlin, which channeled the regime’s totalitarian ambition into uniformly imposing and brutal neoclassical architecture.

Stalin replicated Hitler’s imperial model with his own architectural “classicism”: high rises with domes, spires, and other trimmings meant to denote power. Stalin also took inspiration from New York City’s Manhattan Municipal Building, which signified the Empire State’s grandeur in the 1910s.

Now, the Trump administration is circulating a draft executive order called “Making Federal Buildings Beautiful Again,” which would have architects adhere to “classical” structures, inspired by Greek and Roman tradition. The order underscores the symbolic value of buildings, and explicitly opposes the 1962 “Guiding Principles of Federal Architecture” – supported by President John F. Kennedy – which called for design to flow from the architectural profession to the government.


These leaders have also engaged in another classic form of authoritarian power projection: military parades, which are a tried-and-true method for authoritarian figures seeking to impress supporters and opponents alike. In 2017, Trump could not contain his excitement at a Bastille Day military parade in Paris – there, a ceremony rather than muscle-flexing – held next to the Arc de Triomphe (incidentally, one of Speer’s inspirations for Nazi Berlin). Two years later, Trump held his own, dizzyingly expensive military parade

It may be tempting to dismiss such performances as distractions. But they directly enable a predilection for dangerous or reckless behaviors, including the rejection of all checks on executive power – crucial to a functioning democracy.



Margaret Thatcher on Socialism: 20 of Her Best Quotes

February 14, 2020

Lawrence Reed in this post picks 20 quotes of Thatcher:

This autumn will mark 30 years since Margaret Thatcher departed 10 Downing Street as the first woman and longest-serving British Prime Minister of the 20th Century. What an amazing tenure it was!

No need to take my word for it, though. I offer here some of Margaret Thatcher’s most incisive remarks about the socialism some Americans seem attracted to these days. They stretch across decades of her public life.

Lots of interesting quotes in the post..


Podcast: The Rich History of Banking in India

January 31, 2020

After the first attempt at podcasts, trying to do a few more. Here is another one with Pavan Srinath who does weekly podcasts with Pragati.

In this podcast, we chat and discuss the sweeping history of banking in India from the indigenous banking to bank nationalisation in 1969 and 1980. We will continue the conversation post 1980 in the next episode.


Improving European economy: Draghi’s three Ps of mon policy, Summers’s three Ts of fiscal policy and Buti’s three Fs for structural reforms

January 27, 2020

Marco Buti of European Commission in this voxeu piece:

The current slowdown and lacklustre medium-term growth prospects also indicate that the fiscal, monetary and structural policy mix needs to be changed. As Mario Draghi stated in his speech in Sintra (2019), monetary policy needs to remain patient, persistent and prudent. Fiscal policy needs to fulfil the three Ts as identified first by Larry Summers (2008): timely to be effective, targeted by focusing on high multipliers expenditure and – possibly – temporary. While the jury is still out on the desirable fiscal trajectory in presence of ultra-low interest rates, there is little doubt that a long-lasting boost of public investment should be undertaken. One such example would be quality-investment to ease the environmental transition. Complementing Draghi’s three Ps for monetary policy and the three Ts from Summers, I propose three Fs for structural reforms: they should be feasible to be effective in the short term instead of aiming for unrealistic goals; forward-looking, for instance regarding environmental issues; and fair, by incorporating distributional concerns and moving away from the perception of reforms as ‘blood and tears’.

Joining the letters, they spell TFP, a fitting acronym to capture today’s economic and policy predicament in Europe.

Phew! This is all encompassing. Add these adjectives to Prof Sashi’s flowchart of reforms and you have a good template of putting every macro policy/reform under the sun..

Tomb Economics

January 23, 2020

Alex Tabarrok in this blogpost wonders why Mughals built so many tombs:

The Mughals of Northern India are famous for their tombs, Humayun’s tomb in Delhi, Jahangir’s Tomb in Lahore and, of course, the Taj Mahal. Why so many tombs? Culture surely has something to do with it, although conservative Muslims tend to frown on tombs and ancestor worship as interference with the communication between man and God. Incentives are another reason.

Under the Mansabdari system which governed the nobility, the Mughal Emperor didn’t give perpetual grants of land. On death, all land that had been granted to the noble reverted back to the Emperor, effectively a 100% estate tax. In other words, land titling for the Mughal nobility was not hereditary. Since land could not be handed down to the next generation, there was very little incentive for the Mughal nobility to build palaces or the kind of ancestral homes that are common in Europe.

The one exception to the rule, however, was for tombs. Tombs would not revert back to the Emperor. Hence the many Mughal tombs.

Interesting. Have no idea on this. Do people have other ideas?


75 years of Auschwitz Liberation

January 23, 2020

Auschwitz detention camp is easily one of the biggest blots on humanity. AuschwitzMuseum is running a depressing Twitter handle showing pictures from the camp.

Ana Palacio, former Minister of Foreign Affairs of Spain in this Proj Synd piece says we should not forget this tragedy:

75 years after the liberation of the Nazi death camp at Auschwitz, anti-Semitism is again on the rise across the Western world. This trend – and the weak response to it – is a harbinger of democratic decay.


A Decade of Decay: Supreme Court serves a self-selecting elite instead of standing up for the Constitution and people.

January 23, 2020

Alok Prasanna Kumar of Vidhi Centre for Legal Policy  in this must read EPW piece:

The Supreme Court of India enters a new decade with its reputation as an independent constitutional court in tatters. It has wilted under the gaze of intense public scrutiny over its actions. In the last few years, it has been called upon to check the unconstitutional excesses of a majoritarian government with a full majority in Parliament, but failed again and again. The only comparable decade is perhaps 1970 to 1979, when the Court was riven internally and succumbed to external pressure in the face of another strong executive government.

In this column, I examine the Supreme Court’s decade of decay to understand where it has all gone so wrong with the Court through two major themes that are fundamental and linked to the Court’s constitutional role: the questioning of the union government’s actions and the appointment of judges.

Instead of an exhaustive survey of all the cases decided by the Court, I have chosen two representative incidents at either end of the decade for each theme to try and map the Court’s trajectory. The Supreme Court, I argue, has fallen into the grip of a self-selecting elite that is more concerned with perpetuating its hold on the Court and the judiciary at large, instead of standing up for the Constitution and people.


The Green Swan: Central banking and financial stability in the age of climate change

January 21, 2020

Kudos to BIS for bringing a report with such an innovative title. Taleb made his point about financial risks via his boo titled Black Swan and BIS is doing the same highlighting climate risks with the title Green swan!

The report is written by 4 scholars – Patrick Bolton, Morgan Després, Luiz Awazu Pereira da Silva, Frédéric Samama and Romain Svartzman:

Climate change poses new challenges to central banks, regulators and supervisors. This book reviews ways of addressing these new risks within central banks’ financial stability mandate. However, integrating climate-related risk analysis into financial stability monitoring is particularly challenging because of the radical uncertainty associated with a physical, social and economic phenomenon that is constantly changing and involves complex dynamics and chain reactions. Traditional backward-looking risk assessments and existing climate-economic models cannot anticipate accurately enough the form that climate-related risks will take. These include what we call “green swan” risks: potentially extremely financially disruptive events that could be behind the next systemic financial crisis.

Central banks have a role to play in avoiding such an outcome, including by seeking to improve their understanding of climate-related risks through the development of forward-looking scenario-based analysis. But central banks alone cannot mitigate climate change. This complex collective action problem requires coordinating actions among many players including governments, the private sector, civil society and the international community. Central banks can therefore have an additional role to play in helping coordinate the measures to fight climate change. Those include climate mitigation policies such as carbon pricing, the integration of sustainability into financial practices and accounting frameworks, the search for appropriate policy mixes, and the development of new financial mechanisms at the international level. All these actions will be complex to coordinate and could have significant redistributive consequences that should be adequately handled, yet they are essential to preserve long-term financial (and price) stability in the age of climate change.

Looks like a really comprehensive assessment of things..

Trying a hand at podcasting

January 20, 2020

My first attempt at podcasting with a dear friend Vivek Narayan who is a Doctor based in US.

Never realised that the medium could be so much fun. Thanks Vivek for all the editing!

More to follow.


Cambodia is criminalizing democracy by suppressing opposition

January 17, 2020

Is America Going Fascist?

January 16, 2020

WHo would have thought this question would be asked and needs to be answered.

Daron Acemoglu in this piece warns against this typecasting as it polarises the society further:


When Climate Activism and Nationalism Collide

January 15, 2020

Kemal Dervis sums up one of the key battles of 2020s decade:

There is an overwhelming consensus among scientists that this decade will be the last window for humanity to change the current global trajectory of carbon dioxide emissions so that the world can get close to zero net emissions by around 2050, and thus avoid potentially catastrophic climate risks. But although the massive technological and economic changes required to achieve this goal are well understood, their political implications are rarely discussed.

While climate activists have built an impressive international movement, broadening their political support and crossing borders, the nationalist narrative has been gaining ground in domestic politics around the world. Its central message – that the world consists of nation-states in relentless competition with one another – stands in sharp contrast to the climate movement’s “one planet” emphasis on human solidarity. And these two trends are on a collision course.


In fact, this clash may become a defining feature of politics, with the nationalist right facing a coalition of climate-oriented voters comprising not only today’s Greens, but also those from the social-democratic center-left and the traditional center-right. Moreover, other issues will be connected to this fault line, not least the need for domestic compensation of those groups that temporarily lose out as a result of ambitious climate mitigation efforts.

If the dominant divide of the 2020s is between the nationalist narrative and green internationalism, then the climate debate may import global issues into national politics like never before. The outcome, of course, remains to be seen.

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