Thursday, June 9, 2011

We need efficiency, risk taking, quick decision making and big thinking in governance. Not just freedom from corruption......and a solution to the Lokpal logjam.

Something has been irking me about this entire corruption struggle. I have no doubts we are riddled with corruption; and yet I feel that the civil society activists are missing the point. It’s alright for them to take one single issue up and make that issue look like it’s the only problem bugging the country. But that’s not true at all. There is this other big problem of governments that lack visionary thinking, ability to take risks, taking bold decisions, executing well and thinking strategically and boldly. At present, there is a disincentive for all this. In fact, there is a premium attached to sticking to the knitting and not doing anything that is out of line with traditional practice. Are we then saying that it’s ok to be slow and inefficient. Just don’t be corrupt?

Who would you rather prefer? AK Antony – known as one of the cleanest ministers – but who hardly takes any decisions? Or Praful Patel – action oriented; functioning like a CEO; one who changed the look of the Indian aviation sector – but who has been unable to survive the charge of nepotism and perhaps corruption? If the entire country feels that AK Antony is better, then let’s be ready to live with 4-5% per annum annual growth rates. Why should any minister take risks? It’s probabilistically impossible to expect that all risks taken will yield great results. What if poor results emerging from risks taken are used as the basis for levying charges of corruption? For me, the role model for India is Praful who performed like a corporate sector CEO and took bold decisions to privatize the airports, adopt the PPP model, and execute well. Or Kamal Nath – who again took on a self-imposed goal of developing 20 kms of roadways a day. Sure, in a sector full of corruption like Road transport, there were some allegations of corruption against Kamal Nath and Praful Patel.....but that can be handled later.

Look at India’s inefficient power sector. We fail the targets set in each and every five year plan. It’s taken us decades to do what China would do in a single one. We still have amongst the highest T&D (Transmission and Distribution) losses – a euphemism for theft of power. Or look at the rural affairs or public health ministries....they have rarely had visionary leaders – just look at where that sector is headed. In contrast, purely from an efficiency perspective, the telecom ministry has been a beneficiary of bold decisions. Especially during the NDA government’s time when Pramod Mahajan was the minister. Everyone knows this – Pramod Mahajan was as corrupt as Raja or Maran. He was a true blue politician who could make money where no one dared or dreamed. But he was a forceful leader also. He was able to change the licensing regime from a fixed license fee to a revenue sharing one. A good decision, no matter what the CAG or the JPC may say about it. Without that decision, the telecom industry would not even have been a fraction of what it is today.

In many ways, I cannot but comment again on Lalit Modi and his contribution to the world of cricket. He is a visionary. He made India the center of the cricketing universe. A world which is deeply racial and in which the goras wish to remain the permanent masters. Lalit Modi broke that grip of theirs. Today, for nearly 2 months in the year, the world’s biggest and brightest cricketers (and goras in particular) compete with each other to be selected by Indian franchise owners. Did Lalit Modi do everything right? No. And yet, we need more Lalit Modis and less of the clerical Shashank Manohars.

That’s why when the PM had first announced that there would be “corporate style” performance reviews of our ministers, I was very excited. In all this recent tamasha about corruption, that seems to have gone out of the window. And no one is bothered about it. So what I am saying is that efficiency and strong bias for action and decision making matters more than corruption. Is it possible for both to co-exist? Of course. That’s what happens in the West. Or rather in developed countries.

We do need a tough corruption act, but my version of it is a little different than what Anna’s is. Here’s what I feel. In a country where Public Interest Litigations (PILs) can be filed routinely against anyone and everyone, and where our farcical media has the habit of pronouncing people guilty all the time, it’s important to protect our “CEOs” from routine accusations. Equally however, if there is a corrupt PM or minister, action must be taken against him/her. The solution must lie in setting up an in-between layer......a kind of a filter....which takes preliminary calls on whether to go ahead with a probe or not. This filter cannot.....repeat CANNOT.....comment on policy matters. Policy making is exactly what the PM and ministers do and their policies are what we as voters vote for or against. This in-between layer will quickly investigate if there is anything serious and if it finds so, then and only then will the prosecution be permitted. This in-between layer should not be a single person politician like at present. It cannot be the Speaker of the Lok Sabha who but another politician. Maybe it can be a combination of people – including the Speaker, the Leader of the Opposition, a senior HC or SC judge, the CVC, and the like. It CANNOT include civil society members. They have no locus standi. Alternatively, it could be a panel made up only of SC judges who decide on the prima facie possibility of the charges being true.

If we did this, then most of the confrontational issues between Anna and the government could be sorted out. The PM, the conduct of the minister’s inside Parliament, the lower or higher bureaucracy, all can be included in the Lokpal Bill.....subject to a filter being used first. The Lokpal cannot however have its own courts. Because again, the Lokpal is merely an investigating body. An investigating body cannot be a court also. No where in the world is this done. The Lokpal must prove its charges in the usual courts of justice. What we can have are special courts to try corruption charges in politics and governance. Those, that focus only on corruption charges and hopefully deliver verdicts quickly. What about having its own investigative body? Yes, I think this is a must. Since the CBI looks after several kinds of investigations (including rapes and murders).....a separate body is required for corruption investigation. Why worry about the costs? If the corruption can be lowered, these costs will justify themselves.

Let’s be honest. What Anna Hazare is demanding is bizarre. No right thinking man or woman should support his demands. His movement is purely political. He is a strong anti-Congress leader, whatever his compulsions may be. If his demands are accepted, the Lokpal will become super corrupt. Please remember – Anna himself is not going to be the Lokpal – some ordinary professional will be. Imagine if one of the Bhushans becomes the Lokpal. It will be disastrous for the country. The Lokpal must be under the government but still independent, like the Election Commission is.

The real truth is that we need to protect risk taking, quick decision making, and big thinking, rather than worrying only about corruption. Without that, we are doomed. I would rather be a 10% corrupt country growing at 10% per annum than a zero-corruption country growing at 4%. In economics, it is said that a certain level of imperfection is a must. There must be 4-5% unemployment % is not good as 4-5%. Zero would make the labor markets too strong and business would suffer. Likewise, a free-for-all Lokpal would make our leaders risk averse and slow down the country. We should guard against that.....

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