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inequality

Town Hall/ White House

Original post from the SAES blog. I’m blogging and tweeting from the South Asian Economic Summit along with a few others, hastag #saes2013.

This morning Pakistani economist Akmal Hussein talked about how mainstream economics/capitalism teaches that inequality is essentially an un-avoidable by product of growth. He said that equity is not only a measure of social justice but can also be a powerful driver of growth. You just have to open the lower and middle classes to opportunities to grow, giving you a much bigger base.

Great sentiments, I agree 100%. But how easy is it to talk about equitable growth while many countries in South East Asia are facing a ‘neoliberalize or die’ situation? And indeed, are enthusiastically jumping in the very same capitalist bandwagon that facilitates this systematic inequality. India for example is notorious for facilitating corporate expansion. It is, in fact, one of the most characteristic features of its growth. I think the tendency is to hope that equity will come after wealth is achieved, but if the West is any example, a semblance of equity within one’s borders is only achievable by impoverishing peoples beyond it.

Earlier still Ahsal Iqbal Chowdhry, Federal Minister For Planning in Pakistan, spoke bold words about the ‘failure’ of the Washington consensus, and even mentioned discarding it for a Colombo consensus, whatever that may mean, hopefully achievable starting today. But seeing as the most powerful economy in the region got its early nineties boost by the very same Washington Consensus, has it really ‘failed’ in that sense? What would India have been if it wasn’t bailed out? If it wasn’t invested in heavily by Western corporations?

I’m not defending the Washington Consensus, far from it. It has indeed created a lot of harm by seemingly creating growth, but it is ironic that it is this very growth that we celebrate, and hope to convert into something that is fundamentally against its nature. The Washington consensus ‘worked’ because it was essentially hegemonistic. It is the patronage of the powerful to the weak, and beggars cannot choose luxuries like equity.

Will Choudhry’s imagined Colombo Consensus incorporate some similar form of hegemony? Assuming it can even shrug of its Western counterpart as easily as he makes it sound. Indeed can South Asia with all its deep running conflicts, ever form a collective without some entity dominating?

Perhaps the fear of outside interference can enlighten the region to the benefits of mutual cooperation. But it has already incorporated many elements of Chowdhry’s ‘Washington Consensus’, perhaps too many to think of turning back without completely destroying and remaking itself. Perhaps in retrospect, it is telling that both speakers were Pakistani?

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labour-movement-610x282

As published in Echelon (artwork by same) 

May Day Rallies to me were a vague call back to communist absurdity, until I found out that the phenomenon actually started in America, and has more to do with the labor movement than communism. I’d always greeted it with appreciation; because like every Sri Lankan I appreciate the occasional holiday, them being so hard to come by and all that. This time though, volunteering with a movement of anti-hate activists, I found myself stepping out to distribute our message to rally attendees. As veteran activists assured us, there is no easier way to get your message across to otherwise practically unreachable corners of the island than to ambush the people when they gather in Colombo en masse.

May Day in Colombo is a crazy affair. Busloads of people are brought in from all over the country, hundreds of thousands of people gather in the city, they eat, they drink and they pay for nothing. Although no official figure is known, if the government’s claim that nearly 2 million people were ferried into the city this May is to be believed, then the cost for the whole day could have been close to a billion rupees. What is also unknown is who actually footed the bill. Mainstream media was silent on this particular nosy question.

Minor rallies attracting fewer people had move the staging area to the middle so that only half or even a quarter of the grounds were fully used. This seemingly absurd tactic succeeded in giving the illusion of a larger crowd, especially to the cameras. However the JVP rally drew massive crowds to the BRC grounds with its decorated floaters and people in red t-shirts with stylized pictures of Rohana Wijeweera, reminiscent of that iconic Che Guevara portrait, emblazoned on their backs.

The emasculation of the labor movement in Sri Lanka started before Wijeweera, in the 1950s, when it was at its peak. During its glory days the labor unions organized a series of successful strikes under the leadership of AE Goonasinge, who founded the movement in the 1920s. At the height of the power of Sri Lanka’s political left, which soon adopted the movement, the general strike and civil disobedience of 1953 brought the UNP government of Dudley Senanayake to its knees. A massive outbreak of what some called ‘hooliganism’ and others termed a ‘public uprising’ forced his resignation. The 1953 hartal represented the first and probably the last real instance when genuine public discontent was allowed an outlet via something close to ‘democratic’ means in independent Sri Lanka.

The general strike of 1980 for instance was less successful. The vicious crackdown of JR Jayawardene’s UNP only put the nails on its coffin. In a nation with the glimmerings of war already on the horizon, and politics highly oppressive, the labor movement had lost much of it potency. In the intervening decades, the once influential LSSP had split in to various parties touting Trotskyist, Maoist, Stalinist and other ideological manifestations of leftist thought and the labor movement had split along with it. Traditionally ‘capitalist’ parties had encroached it in a bid to dilute its power and transform it into a means of countering political opposition. In the process, public recourse to expression of dissent was quickly moving from democratic to undemocratic means. The eighties are a bloody testimony to this, with not one, but two insurgencies tearing the country asunder.

Alcohol and sycophancy go together. Now parliamentarians bring their own busloads of people whom they apparently ply with drink to appease. Indeed an overwhelming number of people we met that day were drunk. The scent of liquor and the doddering unpredictable congeniality of drunk people was everywhere. When we reached out to grab a number of caps that fell out of a bus carrying rally attendees, eager for any implement that would allow us to ‘blend in’, we found them soaked in vomit. At rallies that were starting off, people were enthusiastically shouting slogans and dancing to the beat of drums; at rallies that had gone on for a while, they were morose with a higher tendency to get into fights. After tactfully extricating ourselves from a tight spot we proceeded in the afternoon to a rally where the crowd, seemingly done partying for a while, was idly napping in corners of the grounds as the speaker onstage droned on about Engels and whatnot, as oblivious to the crowd as the crowd was to him.

What motivated them to come? Perhaps some came of their own accord, spending hundreds of rupees, from distant villages, in order to fight for the rights of the laborer in a broken system on a much needed holiday. But May Day today is less about the workers than the politicians that represent them. The money, in a rare example for our country, is flowing from the top to the bottom. It is the politicians that are bringing the workers into town. It is the politicians that are spending money, apparently motivating workers to fight for their own rights. The labor movement has been sabotaged by politics; its integrity sold for a free trip into the city, a lunch packet and a quarter bottle of liquor.

Today, any resemblance the labor movement has to a ‘people’s movement’ has all but disappeared. In a few decades, from the height of its power in 1953, it disintegrated from fighting for the people and toppling governments in their name to being an instrument for their subjugation. The failure of several attempted general strikes in the wake of utility price increases in recent weeks evidences its lack of cohesion and unity. May Day rallies today are a sad testimony to what infighting, politicization and a loss of purpose can perhaps do to any truly grassroots movement that strives to express the ‘people’s voice’ in our country. The labor movement is a body without a soul. A farce perpetuating an ongoing political charade.

image from JDS Lanka

image from JDS Lanka

The Pax Rajapakse is almost four years old. In that time I’ve gone from being a relative tortoise in my own country to having a degree of freedom that I never imagined possible. I’ve traveled now to virtually every place formerly torn up by the war. And can travel anywhere else I please should I wish to do so.

But the Pax Rajapakse is just that, peace. It has no moral identity. It has no moral pretensions even though it likes to pretend otherwise. Dreadful things are done to preserve the peace. But in all objectivity some might say that the end justifies the means. Peace is its own reason.

But a once universal peace is now fragmenting into varying degrees of peace; different categories of peace now exist. There is a lesser peace and a greater peace. The greater peace is being able to move around your country with freedom, the lesser peace is demarcated by invisible lines drawn through society with labels saying things like ‘Do Not Cross’, ‘Trespassers Will Be Shot’ and  ‘Sycophants Only’.

The country, as it strains under the forces of development, churns society like the roiling Indian Ocean and casts up new oppressed classes and facilitates the surge of new elite. Apparently there is ‘good’ corruption and ‘bad’ corruption. So say some, justifying the regime’s steamroller approach to progress with a substantial personal cut. But where is the line, I say?

While people leave on boats, and put up with heavy abuse for want of jobs and are kicked out of their homes to make way for high rises in the midst of Colombo; a whole new class of wealthy and powerful Sri Lankan is emerging. Closely connected to the country’s powerbrokers, they wield high influence that cuts through social and legal infrastructure like butter. Any justice is we have here is highly skewed in the favor of these elites.

All this has not gone unnoticed. The people are restless and feeling the brunt of ever increasing cost of livingn. Straight talking journalists are still in danger. And the briefly stable peace is now crumbling at the edges with this latest drive of racism. The people are hungry for something to blame. A few decades ago it was the Tamils, and now it is the Muslims. 

But peace is profitable, war is not. And the last thing the government needs is another conflict. And therein lies the problem. Sri Lanka is a corrupt animal. This corruption is like a cancer, but it can still grow within it. Most forecasts still place our economy with prospects of around 6-7% of GDP growth per annum. On a global scale this is huge. This means we double every ten years or so. And if we’re patient enough and do not over reach, we can still become a rich country in our own time.

There are however, serious glitches that can ruin everything. Since Sri Lanka stopped being a low income country, it has stopped receiving aid which basically allowed us to spend more than we earned without worry. And over the years a strong parasitic class developed that benefited and prospered from this surplus, the result; a bloated state sector, crazy inefficiency and high levels of corruption. And now it is this transition from being aid dependent that is really killing us.

Finding itself forced to cover up its various deficits (budget and current account) by taking loans, Sri Lanka is realizing (I hope) that it is mixing a recipe for disaster. We need solid foreign investments to replace these loans and they will not come in until the political, and by extension business, environment is made investor friendly; until budget gaps are sorted out sustainably;  until capital expenditure is focused on projects with long term benefits like education, infrastructure and health.

Currently the government is trying to cover its behind by putting the burden on the public. It should be cutting dead weight and increasing its efficiency by turning state corporations (like the cash bleeding CPC and CEB) profitable, instead it is reducing much needed public expenditure and increasing prices of essential goods and utilities. This burden on the public, ever increasing with the latest round of fuel price hikes, is what is contributing to unrest. There is a continuing laxity in addressing post war issues, and fiascos like the Expropriation Bill and the impeachment of the Chief Justice are poorly handled and reflect very badly internationally.

The Rajapakse regime still has my support. Most East Asian giants grew up under pseudo democracies; Indonesia, Malaysia and Singapore. And the fact that we lack a better alternative has never been more obvious in the light of the UNP’s recent feeble opportunism in attempting to capitalize on racist propaganda. The Rajapakse’s have huge potential to bring something the country has not had for a long time; political stability and long term growth. But they cannot do this by cultivating a parasitic social sub-strata of sycophants and dependents.

Hidden agenda lurks behind this fresh wave of racism, trying to distract from pressing issues at hand. What we should be doing is figuring out the real problems and then campaign for reform, especially with the limitations of our reality in mind. This is undoubtedly hard to do in the current context; the corruption is the cancer and it is within all of us, if you will permit me a bit of drama. If the Rajapakse regime had a big role to play in creating the pax, average Sri Lankans have an even bigger role to play in keeping it.

Water Is Life is carrying out a play on a twitter hashtag that is usually considered to be satirical. #firstworldproblems tweets are usually self effacing guilty admissions of how people have it so good but they still complain.

Water is Life however have voted to take it seriously. I don’t whether on purpose or not. Their campaign features poor kids complaining of how much they hate it when their leather seats don’t heat up, when they leave their dirty clothes lying around for so long that they stink, or when they say no pickles but they still get pickles.

The whole effect is quite jarring. I don’t know how many first worlders would donate after seeing it though, especially those first worlders who might have at some point tweeted something with the hash #firstworldproblems, who might be a little too guilt tripped to look at it with any favor. Apparently some think it in bad taste. But perhaps not as bad as the tweets themselves, which, taken in context of what people have to go through in Haiti and other places like it, can seem downright cruel.

image

Today at the barbershop i had an epiphany about films. An old Sinhalese film, must have been from the forties, was playing on the small TV. The barber told me that those actors are all probably dead now. The move is called ‘Geetha’, the full credits roll by in the beginning, but there’s a short intro into the whole theme with a scene before that.

The son has just come from England. He sports a little Hitler mustache. He is wearing a dress shirt, pants and tie. The father is dressed in a suit. They are rich people. The mother is absent. She has apparently gone to yet another meeting of a ‘women’s club’. It is a habit of hers to throw away money on these clubs and receive high positions in them. She has taken the good car to go for a function now. The son ridicules his mother’s behavior and questions her objectives. The father says that he has no real say in the matter, since he is a poor man and his wife owns all the money.

Soon the mother returns, bearing a heavy basket of flowers which she was gifted at the event as the chief guest. The son accurately guesses that she must have donated ten thousand rupees to this particular event judging by the weight of the basket, which weighs ten pounds, and the going rate for gifts of flower baskets in return for donations must be a thousand rupees for a pound. This angers his mother. She is dressed in an immaculate sari and sports one of those elaborate 1940s hairstyles that curve around a woman’s face. Further argument is suspended when a worker from their factory comes calling, to tell them that his daughter is getting married. The worker is dressed in an old but neat suit and sarong, his wife wears a carefully preserved white sari.

They have obviously come to ask for financial assistance. but as custom dictates, they don’t say so openly. All pretension is to the effect that the visit is merely to ‘inform’ for propriety’s sake. The father invites them in, the son asks them to sit down. The worker and his wife sit with great hesitation. The father and son then ask some random questions like “where is the groom from?”. The groom is from Kandy and works in the civil service, apparently his salary will be increased once he gets married.

Further conversation is interrupted when the wife loudly calls the husband aside.

“What are these poor people doing sitting in our living room, she asks, “who are they?”

“He is a worker in our factory with his wife”, says the husband.

The wife becomes livid, “poor people have their place and they should not be sitting around becoming pally with the likes of us, have you no shame?”

“well, what do you want me to do?”

“tell them to bloody leave!” she yells, so loudly that the worker and his wife get up, startled, and make as if to go away.

The husband though, plaintively persists “his daughter is getting married, we should give them something, how about five hundred rupees?”

“Are you mad? We already pay them salaries and bonuses. Just give the man five rupees and send him off”.

At this moment, the wife sees some of her acquaintances from her club coming to pay a visit. She becomes alarmed. “Chase those two away at once, what will my friends think of me if they realize the kind of people we welcome into our house!”

The women have come to diplomatically elicit yet another donation, in return for which they will nominate the wife for a post in the parliament. The wife is more than eager to agree. And shells out ten thousand rupees, which must have been a thumping amount at the time, on the spot. Meanwhile the son muses on the fact that his mother loses no time in throwing away ten thousand rupees to become a ‘public servant’ when she can’t stand the sight of the general public inside her own house.

Who in Sri Lanka makes films like this anymore? All i see are movies aping Bollywood. And ‘comedies’ with jokes so lame they need crutches. Some might say that good films with strong messages do get made, but either they get no exposure, or there simply isn’t a market for them.So is something wrong with the Sri Lankan film goer? Have the people no more appetite to ponder ground realities like the class and political differences that underpin the way we live today?

Many Sri Lankans today are sold on cardboard dreams built on TV reality shows and dolled up movie stars. The typical poor Sri Lankan is caught up with the glamor of the rich, and wants to own it as soon as possible. So when he sees the politician roll by in his cavalcade of Range Rovers and matt black BMWs he doesn’t see a vile rogue who owes everything he has to corruption and abuse of power, he sees the epitomization of his own dream. The only way to stop being oppressed is to become the oppressor.

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For minorities to know their place in this country all they have to do is to look at its national flag. Here’s a picture. There are the minorities colored in green and orange, and the Sinhala have a big patch of red.. Hey that’s fine, proportional representation ain’t no crime, but what’s that there in the red patch? is that… A lion? wielding a drawn sword..? Roaring in the general direction of the minorities? Keep out, its saying. This is my turf I’ve pissed all over it, one foot where it doesn’t belong and you’ll soon be ingesting several feet of sword.

No matter.. Minorities here know their place. The Muslims especially have always known their place. In Sri Lanka it seems to me that it is patriotism that is the opiate of the masses. and the Middle classes the biggest consumers. The rich are too busy getting richer, the poor are too busy being poor, but the middle class is upwardly mobile.. Asiff Hussein the anthropologist mentioned this in passing once and the thought has been running around in my head and gelatinizing and taking shape.

The middle class want wealth, the politicians and oligarchs steal that wealth and direct middle class anger towards the Muslims. It’s a classic strategy. Take the USA that stronghold of democratic justice, despite all the problems its people face what do they argue about the most come election time? Gay marriage, abortion and yeah, Muslims. Everything else is secondary. The whole political-media mechanism gears itself around these issues and the people are nicely distracted from the real issues. The wars the corporate abuse the widening wealth gap.

The war here is done.. The upwardly mobile middle classes are hungry, educated and success has been long in coming and now they won’t let anything stop them. They’re really starting to chew on what’s stopping them but it would be disastrous if they start chewing on how their leaders are screwing them out of so much money and opportunity.. So the Muslims, probably the most peace loving people in this country are painted black.

Easy job right? global propaganda is already helping them along. All they need to do is translate books of Ayaan Hirsi Ali or of some incident of barbaric cruelty perpetrated against a woman that has nothing whatsoever to do with Islam and sell them on the pavements of Nugegoda. All that needs to be done is to channel the appropriate funds to bhikkus and organizations willing to sell their souls and you’ve got a racist ‘movement’ that operates in increasing legitimacy.

Facebook statuses I see, pictures being shared around by educated Sinhala youth, sometimes even my direct friends and people I like and who I think like me.. They are all wasting their youthful exuberance. Muslims aren’t the enemy. Muslims in Sri Lanka have made it a habit of living off local prosperity. If you the majority aren’t rich then who will buy our goods? We’ve never had any political ambitions that threaten your sovereignty. If you prosper, we prosper and vice versa. In the past we both prospered by working together against the Portuguese, Dutch and English. Crack open a history book, a real history book, not the one you get from school.

Something is sucking your energy, young people here have always been activists, always headstrong and now something is trying to make you blind. The drug that does it is patriotism, in a context far removed from any form of economic prosperity, which is to say a bastardized form of patriotism. You are blind to the social injustice around you.. That effects you everyday. That shuts you out and closes the door; that invisible barrier beyond which true power and wealth lies in this country.

So wake up and smell the plain tea… It’s got a coating of grime on it called patriotism, but actually it’s just trickery.

Sri Lanka’s poverty line uses somewhat of an outdated system to calculate poverty. But of course, to be fair, the whole world uses an outdated system to calculate poverty. I was at a forum organized by the Center for Poverty Analysis (CEPA) yesterday and a few interesting things were voiced.

Poverty

The Department of Census and Statistics (DCS) takes a value of how many calories a person needs to consume; 2030 calories per day in 2002. Then it looks at how much money you need to buy this many calories and arrives at the food poverty line.

Add to this the estimated costs of other requirements and you have the official poverty line. In 2002 this was Rs. 1423 per person per month. This is inflated every year to reflect the change in price levels. By that measure, it should currently be something like Rs. 3646 per person per month. Successive Household Income Expenditure Surveys (HIES) done by the DCS has revealed the number of poor people as a percentage of the population to have dropped as follows.

By the standards of nutritional measure at least, living seems to have gotten better here. Although the statistics do appear a little fantastic. Harsha De Silva for example asked how poverty levels of Estate workers could have sunk from some 30% in 2002 to something  like 12% in 2009. Admittedly Sri Lanka has gone through some serious socio-economic changes since the ceasefire. And while i doubt the DCS would put a number in public view without reasoning to back it, paranoia and doubt is warranted because it certainly does behave very suspiciously at times.

Lies and Statistics

The CDS remains incredibly cagey and protective about its statistics. When i say ‘incredibly’ however, i mean marginally. But even marginal cageyness when it comes to statistics can render any objective party almost impotent when it comes to interpreting economic numbers for itself.

Take inflation for example; inflation is calculated by tracking the prices of a ‘basket’ of consumer goods that a household is typically assumed to consume. The items in this basket is divided into broad categories (food and beverages, clothing and footwear, education, transport etc)  and further divided into subcategories (like the food category would contain, beets, beans, samba rise, anchor milk etc). These items are then assigned weights based on their relative importance (e.g. food would have 40% of the basket while clothing has 10%). A survey is done on weekly prices and the prices are multiplied by the weights to arrive at the overall inflation figure.

Now i might sound pedantic, but bear with me here. While the CDS gives the weights for the broader categories it fails to give the weights for the sub categories in the basket. And sub-categories are the most important thing here because knowing the relative importance of Anchor milk in the index is the only thing that allows us to accurately calculate the real impact of a milk price hike to inflation.

When i asked why the CDS isn’t transparent about inflation, especially when the government has repeatedly come under fire of accusations of manipulation, Suranjana Vidyaratne, Director General of the CDS, dodged my question. I suppose there is no smoke without fire.

Government data in Sri Lanka is generally like this though. A lot of the Central Bank data that comes out suffers from mysterious lags and occasional omissions and corrections that raise the eyebrow.

What is Happiness?

But is money and food a sufficient measure of poverty? And should we be measuring poverty in the first place? Traditional measures of poverty fall a little short of conveying the real deal of what it means to be poor and human by their valuation of poverty via a measure quantified purely in terms of money.

Since the seventies however, a movement towards including more dimensions into how we measure poverty has been gathering force. The Multidimensional Poverty Index attempts to incorporate factors like education, health and standards of living into a numerical measure of poverty that tries to be sort of more holistic.

Countries like Bhutan are already way ahead in measuring what they like to call ‘happiness’ using their GNH (Gross National Happiness). It takes data that can be quantitatively measured such as health and education but also gives importance to culture, spiritual progress, good governance and other qualitative, and critics accuse; subjective, measures.

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