WEEKEND LIGHTER: Focus on public goods

WEEKEND LIGHTER: Focus on public goods
(January 28/29, 2017, No.4/2017)
Weekend Lighter is posted every Saturday @mgwarrier.blogspot.in
Feel free to mail your views on this edition of WL to mgwarrier@gmail.com

Section III: PM Modi's
Xmas Mann ki baat

Opening remarks
It is gratifying to see that more and more viewers are visiting Warrier’s Blog @mgwarrier.blogspot.in I consider it as an encouragement that some friends have started posting their comments also. Thanks to all.
Focus on public goods

The BS interaction with former RBI Governor Y V Reddy (Business Standard, January 25) gives deep insight into the conduct of bureaucrats, politicians and economists of different denominations which is dependent on their background and career path. Such revelations should help present and future incumbents who are destined to play their role in policy formulation and implementation, which, all do with welfare of the people in mind.
The concern expressed by Dr Reddy about the neglect of public goods need special attention from today’s policy makers. While public goods at primary level include those listed (environment protection, public health, security and law and order) and deserve policy focus, the role of ‘distributive justice’ in management of resources cannot be underestimated.
Of all the resources, the measurable one is financial and therefore the role of Reserve Bank of India in managing currency, monetary policy and debt (internal and external) becomes of paramount significance in India’s economic growth. Dr Reddy’s observation that ‘undermining the identity of RBI should be a matter of concern’ should be viewed in this context. As banking system works on public trust, undermining the stability and strength of the institution responsible for the financial sector regulation and supervision will have an impact on the institution’s ability to perform its mandated role.
M G Warrier, Mumbai


“Isolated power
While supremacists love their own very particular crowds and those crowds love them, they are, as persons, very lonely. And loneliness finds two friends: secrecy and arbitrariness. A mist of trail-less circumstances surrounds a supremacist’s decisions. And these decisions come to be taken impulsively, whimsically. Sometimes they can be inspired, but on most occasions they create more problems than they solve and can also cause havoc. Isolated power is isolated from the advantages of consultation, from the benefit of an equal colleagueship. It is isolated, therefore, from the great bonus of republican partnership. So fond does he become of the dulcet tones of his own voice, that his auditory powers atrophy. Even when he seems to be listening to others, the personal supremacist is, in fact, listening to his own voice reacting to what he is hearing. He is his own singer, his own song and his own listener. The self-centrism of an elected leader is, in democratic terms, an irony. In republican terms, an anomaly. It scarred the period 1975-1977. It must not, in the same or modified form, in de jure fact or in de facto spirit, be readmitted into our polity, our political culture.
There are signs of it wanting to.”

Recent responses
 RBI’s multiple roles
This refers to Ajay Shah’s piece “RBI independence : The middle ground” (Business Standard, Snakes & Ladders, January 23). While accepting the writer’s right to retain his point of view, let me reject as unacceptable the ‘truism’ in the concluding paragraph that “Humans are the same everywhere, and all humans desire arbitrary power, laziness and corruption”. Perhaps, the Financial Sector Legislative Reforms Commission(FSLRC) with which Shah was associated built up its report keeping this thought in the background. This article has skipped the developments during the three-year period when the presence of Dr Raghuram Rajan, a professional with common sense sorted out most of the relationship issues between RBI and GOI.
Shah has oversimplified things by bringing RBI on par with other regulators working ‘under’ Finance Ministry. In the Indian context, RBI’s role has evolved differently and as Y V Reddy reminded recently financial sector regulation is only one of the many functions RBI is responsible for. The article revives pre-FSLRC, or pre-2013 issues which are no more relevant. The need to align monetary and fiscal policies, RBI’s role as an expert advisor  to GOI in forex and debt management and sole authority for currency management is not in dispute today. Post-demonetization confusion  about ‘who did what and when’ is essentially media creation and is getting sorted out fast.
None of the statutory bodies including judiciary and RBI can be ‘autonomous’ or be ‘independent’ from the government of the day, as ultimately law of the land will prevail. Analysts and media confuse laymen by using these words to divert attention when one or the other statutory body raises the issue of functional freedom within the contours of law. As rightly argued in the article, what is needed is, filling up all vacancies on the boards of statutory bodies by individuals who will apply their mind and will not look to North Block before opening their mouth. Only such empowered boards will be in a position to infuse professionalism in the working of institutions like RBI.
Maybe, the draft Indian Financial Code mentioned by the writer could be a reference point to begin another comprehensive exercise to reform India’s Financial Sector. This will have to be participatory, involving GOI departments/ministries concerned and statutory bodies whose function will be reviewed.
M G Warrier, Mumbai

Trump’s missed opportunity

Trump missed one more opportunity to win the confidence of the world outside US. This is how. He had all of 20 minutes when the entire world was watching him to see whether President Trump is going to be any different from Donald Trump who fought and won the election.
By focusing on America and its problems like poverty, unemployment, inadequate infrastructure and an inefficient education system he has exposed the downward growth trend of his country which has been evident for sometime now. By offering the country back to the Americans, he has given a message that he is not going to take the responsibility to rebuild or strengthen US either.
By ignoring the world outside in the  inauguration address of January 20, 2017 Trump lost the first opportunity for making amends for the negative impression that was gaining about him in the outside world on which his country is dependent eternally for survival.
M G Warrier, Mumbai
Leisure, spirituality


“So many rumours were spread, even the fight against corruption and black money was sought to be tainted with shades of communalism. Somebody spread a rumour that the spelling on the currency note was faulty, someone said salt prices had spiraled, someone proclaimed that the 2000 rupee note would also be withdrawn, even 500 and 100 rupee denominations notes were rumoured to be on their way out. But I have seen that despite rampant rumour mongering, citizens have stood firm with their faith intact. And not just that, many people came to the fore and through their creativity and intelligence, exposed the rumour mongers, brought out the falsity of the rumours and established the truth. I salute this great ability of the people also from the core of my heart.”


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