economics

Water Wars

This is a review of the book Water Wars: Privatisation, Pollution and Profit by Vandana Shiva.

Water Wars is a great book for people interested in management of water; the kind of people who binge read newspaper editorials on public policy. It isn’t a hugely educative read, though, since almost everyone (newspaper nut or otherwise) is aware of the water crisis looming ahead, and that solutions to it are way more complex than we’d care to admit.

Just as well, the book is a worthy read because it is spirited (you can almost hear Shiva crying her voice hoarse about the ills of privatisation of water). Also, literature on conserving and saving our environment is necessary, so any literature at all is welcome.

Shiva is an advocate for community led maintenance of water. Her arguments are premised on the idea that communities are democratic and non-discriminating between sections of society. But is that the reality of communities across the country? Caste, class and religion based conflict, related to water, at the village level, are not uncommon in India. It was Ambedkar that said that villages can be the cesspools of narrow-mindedness – are they, then, equipped to solve water crisis equitably? It’s a pity that this point was not critically examined by Shiva.

She also believes that community management can be a replacement to govt efforts. Very well. But every successful case study on community led water management quoted came with the support of the State. For example, Swadhyaya, Pani Panchayat. So reading her ideas about replacing the state in service provision is a little bit of a hypocritic pill to take.

Predictably, the book signs a huge no to privatisation of water services, be it extraction, distribution or recycling. The reasons being that it leads to pollution, inequitable distribution.

Speaking of pollution, a much needed chapter is devoted to the effect of Climate Change on the dialectic on water scarcity. The bad news (not so much news anymore) is that there is no good news at all. Shiva believes that the solution to climate change induced water and food scarcity, and disasters, lies in enforcing action through international instruments like the Paris Agreement (she mentions Kyoto, actually; the book was released many years ago). But there is no way to enforce these agreements, truly. Finally, in a last breathe effort, she says, we need climate justice. That means a paradigm change in lifestyles of people, and a goodbye to the American lifestyle of consumption. But that’s pretty much impossible.

At this point in the review, I think it’s appropriate to point to some of the great despondence that the writer probably experienced while writing the book. These are the not-very-compelling parts of the book: Many pages are spent in saying that private companies (ranging from Coca Cola to Monsanto) are trying to claim all water services, with the help of the IMF and the World Bank. They’re not do-gooders – they’re trojan horses, apparently. So beware! Also, Public Private Partnerships are very dangerous – it’s all about making public good unavailable and making a profit out of it with public money! These statements are not based on facts or figures, rather, they’re based on strong opinions. I did say the book was spirited.

The book ends with a chapter on how rivers are seen as sacred by most civilisations. It was an appeal to the spirituality of the reader, I think, to conserve our water resources. To me, it was interesting for the narration of all the mythological stories related to rivers and other water bodies.

Solutions?

Shiva’s main emphasis is on local solutions to water problems, and she squarely blames states, countries and international organisations, and especially private interests, for the water crisis.

In Water Wars, fierce arguments to save the planet’s water resources by not doing certain things (like privatisation and monetisation of water) are put forward.

But there are no sweeping solutions that are on offer. While the case studies are quoted as a blueprint to solve issues related to water pollution and scarcity, it is also a fact that these stories are not scalable. Abstract ideas of justice and equity are provided as the panacea for water management. Mostly, the author exhorts countries to look within at solutions offered by communities and at traditional methods as ways forward.

If only that worked all the time.

While compelling, the book does not fully quench the thirst for solutions to water problems and water wars.

3/5.

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The Indian Economy, in the 90s

This is a review of books by former Governor of the Reserve Bank of India, Bimal Jalan, India’s Economic Policy: Preparing for the Twenty-First Century and The Indian Economy: Problems and Prospects.

These books offer a great ring side view of the working of the Indian economy. They are, however, dated. To be fair, these are old books, published in the 90s. Nevertheless, they are still relevant to some extent.

For instance, in Problems and Prospects, Bimal Jalan speaks of corruption and how to deal with it, by differentiating the supply and demand for the same, supply being the side of the transaction where people are willing to bribe, and demand being the side where people want, demand, bribes. He puts forth a model to stop both sides of this transaction. His suggestions have, hearteningly, been implemented under the Prevention of Corruption Act, where the bribe taker is heavily penalized (although this has been pushed a tad bit too far by penalizing even lack of action which may result in indirect benefit to unrelated persons causing a loss to the exchequer; it penalizes complicity in corruption, which many believe is doing more harm than good, by making bureaucrats slow and averse to doing risky things, thus compounding the problems of red tapism). He also says that the whistle-blowers should be protected and incentivized for their courage. This seems to be a logical way of thinking about corruption.

Some observations by Jalan made me laugh, mirthlessly. Like, “Indian democracy is schizophrenic” by which he means that although we romanticize democracy (freedom liberty equality!), we’re deeply suspicious of how it works (everyone’s corrupt!). Hence our civil society is weak, parliamentary representatives are not motivated to work for the people and seek to gratify self-interests. General will is all but thrown out the window. But this is changing, as we have seen with “people’s movements” and a burgeoning civil society that increasingly dictates policy. This is a great shift in our democracy that people haven’t taken much notice of!

In his book, India’s Economic Policy, he talks about the weight of Public Sector Enterprises and the losses they incur to the exchequer, and recommends that the state shake them off. This has been a popular demand in India, and the recent governments have taken cognizance of it as they have initiated strategic sales of many of the state concerns.

India’s Economic Policy reads like a journal of the Indian Economy in the 90s, as we were bubbling with hope and trepidation after the giant LPG reforms of 1991.

Some of the issues that are still very relevant, that I picked up, are

  • Making the party whip less powerful – and making the Indian democracy a true representation of people’s interests, as opposed to being a minion of party interests.
  • Separating policy making from policy implementation (ie., the politician and bureaucrat should have more sharper differentiation of functions, and the latter should be allowed to tailor policy to suit the needs of the grassroots)
  • Decentralize, because overcentralization of schemes and programmes has made them inefficient.

The good news is that most of these reforms are in the pipeline, have been implemented already, or have been tried and discarded. I would still recommend it to someone who’s trying to understand the Indian economy from its roots and shoots. I’d rate Indian Economy: Problems and Prospects higher than India’s Economic Policy: Preparing for the Twenty-First Century, for its relevance today and the future.

Indian Economy: Problems and Prospects – 3/5

India’s Economic Policy: Preparing for the Twenty-first Century – 2/5

Bimal Jalan’s books are like a reading of the history of the Indian Economy, and the story of her evolution. They’re good. Easy reading, if you’re conversant with basic economics and have a rough understanding of issues related to the Indian economy. But to understand the economy as it is today, policy, problems, I’d suggest (highly recommend) reading the Indian Economic Surveys. The Economic Survey is cooler – with references to Bob Dylan music, dry and witty sarcasm, it is a giant authoritative perspective of the economy today.

Fun factoids

This is my review of Think Like A Freak by Steven Levitt and Stephen Dubner, the duo behind the Freakonomics and Superfreakonomics books.

This genre is best described as pop-armchair-economics. As someone who is an admirer of all things science and a champion of the scientific method, I can’t honestly recommend these books without coming off as a huge hypocrite.  They provide insufficient facts and flaky logic at times. But to be quite honest, these books are what introduced me to economics in its pure form- the science and art of making conclusions from data.

Like Freakonomics, the book is made up of bite-sized anecdotes that are perfect for reading on the go. The first story is about how thinking out of the box allowed a young man break world records in competitive eating (!). Another interesting one was the need for feedback loops and experimentation in advertising, and how simple observation can take the place of large-scale, potentially costly trials.

They also talk about ‘tricking’ people into saving more by gamifying the process- people were more likely to put money regularly into a lottery than save for retirement.

What I didn’t like was the occasional self indulgence. One story was about how the Freakonomics guys helped the US government catch some terrorists. While it was a clever move, it seems extremely risky and probably something that shouldn’t be in the public eye. They also talk about the concept of opportunity costs by describing their own personal success.

The book is overall a letdown, I expected much more from these two! It manages to be reasonably entertaining and a quick read, though. 3/5

Editorials on Economics

This is my review of Malcolm Gladwell’s What The Dog Saw. If I were to describe this book in a phrase, it would be ‘unsubstantiated interesting observations’. This is a compilation of Gladwell’s articles in The New Yorker and each is a standalone work in itself.

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Happiness Is A Warm Gun

If you’re anything like me, happiness is not something you think about consciously. You take it for granted. I’ve always been of the opinion that happiness is a choice- a function of one’s own mental state, and virtually unrelated to our environment. With my new-found powers of rationality, I decided to test this hypothesis…

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