Can the economics of energy consumption be de-linked from the economics of development? | LinkedIn Answers | LinkedIn

Can the economics of energy consumption be de-linked from the economics of development?

Humans need to eat just 3000 calories a day to survive comfortably....but they spend a million calories of energy to produce that 3000 calories of food...in addition there is the 20,000 calories of energy spent on domestic utilities and personal transport fuel per capita per day.

With all the technology at our command there surely must be known scientific and resource optimization ways to make food production less energy intensive and personal transport less fuel consuming.

Any companies addressing these profligacy issues in their business models would probably do very well in times to come. As an illustration, is there a real need to ferry a 70 kilo human along with a 1500 kilo car when only the human needs to move...the car movement is a real waste....

Did Pakistan's sending millions of fake Indian currency to India actually help India overcome recession? | LinkedIn Answers | LinkedIn

Did Pakistan's sending millions of fake Indian currency to India actually help India overcome recession?

It is well known that Pakistan's notorious intelligence agencies print very high quality Indian currency notes in a bid to destabilizing India's scorching growth economy which they no doubt envy from the bottom of their hearts...

They may have have just achieved the opposite....during recessionary times, the central banks print currency to boost spending and growth, and Pakistan may have inadvertently lent a helping hand....the quality of the notes they print is so good that even bankers cannot make the distinction....so they have been supplying India's currency requirements as a free service for which India owes them a big thank you...

Why is State Capitalism called Socialism? | LinkedIn Answers | LinkedIn

Why is State Capitalism called Socialism?

When the State controls the factors of production, the state entities are called Public Sector. This has to be one of the greatest misnomers ever invented. It is the state acting, thinking and exploiting like a greedy capitalist pure and simple.

Let me illustrate.

The state decides that Electricity is to be produced and distributed by the "Public Sector". Like a capitalist monopolist it prevents any one else competing by making it "illegal" to do so. It then loots poor farmers by confiscating their land for building power plants and other infrastructure. Where a private power plant buying land at market rates would have managed with 50 acres, the "Public Sector commandeers 1000s of acres as the land is getting "acquired" virtually free.

Then the state takes tax payer money and invests in plant and equipment with all purchases accompanied by hefty kick backs. This is exactly like over invoicing and kick backs that many unscrupulous private sector managements indulge in to steal money from shareholders of widely held companies.

The state then gives various tax reliefs and monetary concessions to its new baby at the tax payers' cost of course. It is like a capitalist giving advantages to a closely held group company at the cost of other group companies which are widely held.

The state however does not really understand the art of running a tight commercial enterprise...so the Power plant runs into losses perpetually. The state simply funds the losses from the tax payer's consolidated collections. When these run out the state simply prints more money which is inflation tax on everyone and bites the poor the most.

Capitalism without market competition is usurious exploitation and State Capitalism with the backing of State arms is all that and evil too.

Was Socialism invented by the Devil?

Are India's Himalayan states economically viable? | LinkedIn Answers | LinkedIn

Are India's Himalayan states economically viable?

For the cost of maintaining J&K, since independence, India could have bought a dozen J&Ks...the state barely raises a fourth of the resources it needs to spend to keep going.

The fact is that India spends a huge amount of money on J&K (and other Himalayan states). It is not that India is a rich country which can afford to indulge. With 40% of India's population living in grinding poverty on less than a dollar a day, it is high time India got its priorities right.

Hill states which are well integrated with India can coagulate their populations into larger, more viable towns and cities in the plains and the states' mountains can revert back to pristine nature....it makes little sense to have widely dispersed settlements dotting inaccessible mountainsides....these are prohibitively expensive to service and administer...

In case of J&K, the Jammu region can work out a similar solution and be fully integrated with India...the Jhelum valley populated by people who for whaever reasons perhaps may not wish to stay with India can be let go to whoever can undertake to feed them...at least that will stop them biting the hand that feeds them.

Can population growth be controlled through urbanization? | LinkedIn Answers | LinkedIn

Can population growth be controlled through urbanization?

It is well known that birth rates are far lower in towns than in villages. Globally too, the developed countries have very high urban population percentages and that curbs any tendencies towards population expansion.

As family health wefare and modern medicines have spread through rural habitations, infant mortality has come down dramatically without a corresponding decline in birth rates. This has caused the population explosion of the last 100 years in countries like India.

The obvious solution staring us in the face is to urbanise on a war footing. However the democratic political system militates against this objectively. The emphasis and public debate is overwhelmingly in favor of transporting and providing modern amenities like roads, electricity, running water, sanitation, education and public health to villages directly.

Besides the fact that economically it is vastly sub-optimal to provide expensive modern facilities to farflung population clusters, this delays the process of human migration to cities and towns and directly adds to population growth.

The road map to schieve this would involve stopping all road maintenance for settlements below a defined population threshhold. Simultaneously, subsidies on electricity, fuel and communications need to be withdrawn gradually so that people find it less and less attractive to stay put in their villages and start looking to migrating to nearby towns.

With all the corruption scams bouncing around, is it time to focus on the economics of political careers instead? | LinkedIn Answers | LinkedIn

With all the corruption scams bouncing around, is it time to focus on the economics of political careers instead?

Why are we surprised with all the corruption coming to light nowadays....it takes an annual expense about $250 million to keep a national party like the INC or BJP running and contesting all the federal, state and local body elections that keep coming up.

Considering that officials can expect only low single digit percentages of contracts and deals as bribes and kick backs, to raise these kind of funds, the government executives have to resort to messing up with deals worth more than $50 billions every year. More damaging than the bribes is the plethora of rules that are created to build opacity into the system in order to facilitate easier bribe taking. It surely costs the economy a few percentage points of GDP growth every year which is huge compared to the actual bribes collected.

It is time we stop pretending that political careers are motivated by a sense of national service. They are just like any other pursuit of livelihood and therefore demand a healthy return on investment. The sooner we drop this hypocrisy, the easier it will be to address the culture of corruption.

One way could be to incentivise political parties for the good running of governments...say by paying them a percentage of the incremental GDP above a certain threshold. For example the party running the national government could be paid 5% of incremental GDP above the last 5 year average. If the increase in GDP is 3%, then 5% of that is $250 million which would be quite attractive. Another 5% could be earmarked for state governments.

Wasn't the Telecom minister A. Raja absolutely right in giving spectrum at very low prices? | LinkedIn Answers | LinkedIn

Wasn't the Telecom minister A. Raja absolutely right in giving spectrum at very low prices?

It is obvious that the minister has done the Indian consumer a great service by granting spectrum at throwaway prices. The net result is that India has perhaps the lowest call rates in the world and the tele density has sky rocketted in the past few years.

The minister could have auctioned the spectrum and the corrupt government machinery would have got richer by $40 billion, but ultimately this money would have been collected from telecom subscribers through much higher rates.

It is well known that any money which gets transferred from private hands to government coffers deducts the GDP by a factor of up to 3. So an additional $40 billion if collected in one year to the government could have subtracted India's GDP by $120 billion in that year which is almost 10% of its GDP...

So minister Raja has done the country a huge favor by preventing government from commandeering such a huge tranche of funds. He might have taken bribes of 0,5 to 1 % amounting to a few hundred million dollars from the companies who were given the low cost spectrum, but that is chicken feed really....

There is no free lunch...if India wants to grow fast, it has to tolerate a little bending of the rules...we must not miss the wood for the trees....

And look at the guys who are squealing and protesting...the bureaucrats who were sidelined...

Is there any alternate way of decent earnings for career politicians besides corruption? | LinkedIn Answers | LinkedIn

Is there any alternate way of decent earnings for career politicians besides corruption?

A political career in India means huge investments. The only way these funds can be recovered is by extracting bribes. The more complex the system, the easier it is to extort money from business people and ordinary folks. No wonder the elected bodies like the parliament and state assemblies gleefully keep adding pages after pages to existing laws. The politicians also keep the bureaucracy henchmen in good humour... they really need not give pay raises to employees, just need to add a few clauses to some obscure rules and the government employees will do the rest.

It is no surprise at all that scams are crawling out of woodworks all the time. Political careers need to be made remunerative in a transparent way. For all the buffoonery that politicians engage in, they do supply democracy to the nation...that cannot be denied. That is a service the nations needs to compensate them for generously with a large heart.

By what extent would the Chinese GDP fall if they were to use only non-pirated software and stop manufacturing fake branded goods. | LinkedIn Answers | LinkedIn

By what extent would the Chinese GDP fall if they were to use only non-pirated software and stop manufacturing fake branded goods.

It is estimated that China uses about 80% pirated software...also the country does not enforce IPRs like patents and copyrights seriously. Much of the Chinese miracle growth may be based on free IPRs....any estimates or studies of the issues involved...

Should the legal age for marriage be lowered but a separate higher age for having children be introduced... | LinkedIn Answers | LinkedIn

Should the legal age for marriage be lowered but a separate higher age for having children be introduced...

Physical intimacy at a young age may not bring any harm if people do not have children in the process...young people of course would not be able to bring up children unless they are financially independent and therefore the real issue is perhaps not marriage per se but the consequence of marriage in the form of offspring...if this separation of the subjects of marriage and children is recognized, then medico legal mechanisms could perhaps be invented to create a happier world....

Should India outsource its Judicial function? | LinkedIn Answers | LinkedIn

Should India outsource its Judicial function?

Since independence there has been a constant assualt on fundamental rights of citizens by the state and the judiciary has been a willing accomplice.

Rent control law...the tenant need not vacate the property, pay revised market rents, decendents can contnue to occupy property after his demise....in effect this law demolishes right to property but courts have upheld it.

Government can acquire property for what it considers public good. Under these pretexts, government aqcuires land from farmers for ordinary economic activity like building factories, residential colonies, market places etc....owner of the land has no choice but accept whatever government or courts deem fair compensation. This law creates internal refugees who get converted from proud, self respecting farmers into slum dwellers.

Ubiquitous land acquisition benefits politicians who collect kickbacks from those alloted low cost land or to build infrastructure for the ever expanding parasitic bureaucracy for their offices and residences in the name of public good.

These are two glaring examples where the judiciary actively misinterprets the spirit of citizens' rights and colludes with the state to deprive people of their fundamental rights.

In case of land acquisition fair approach would be to permit government acquiring land only for roads, railways, ports, airports and defence. Here too land could be taken on long term 99 year lease from farmers and rents could be revised annually to reflect market rates. For all other purposes like factories, markets and colonies, developer would buy at market rates as that is normal economic activity.

Obviously judiciary has no clue about true meaning of freedom, liberty and rights...it may be best to outsource at least the supreme court function to retired judges from older democracies who have these values baked into their DNA....

Else India is well on its way to becoming a banana republic.

Can India force Pakistan into an expensive arms race which helps cripple Pakistan's economy? | LinkedIn Answers | LinkedIn

Can India force Pakistan into an expensive arms race which helps cripple Pakistan's economy?

Ronald Reagan's star wars program helped accelerate the implosion of the soviet union. The struggling russian economy just could not cope up with the expense involved in matching the sophistication of the star wars' technologies which were backed by a economically superior US.

Can India pull a leaf out of the US book and force pakistan into a nuclear arms race which the latter just cannot afford. Of course big brother china could always step in and subsidize pakistan but that would help smoking out the chinese clandestine proliferation machinery from behind the bushes....

Is the concept of democracy past its "use by date"? | LinkedIn Answers | LinkedIn

Is the concept of democracy past its "use by date"?

Rule of law is distinct from rule of rulers...democracy has largely meant rule of law administered by people's representatives. In complex modern societies with complex laws people often elect representatives who just are not up to the task. Administering these rules is sophisticated work which needs specialized agencies. Adding a layer of simpleton and pliable people's representatives on top of specialized agencies (government departments) absolves these officials from total responsibility and ownership for their actions and deliverables....and unbridled populism is often the net result...No wonder most democracies are in a mess whereas authoritarian regimes like China are flourishing.

Democracy was invented when laws did not exist and therefore it was better to have rulers elected by rotation to prevent despots and tyrants taking over permanently...but now times have changed....even North Korea has laws...even Saddam Hussain had laws....the whole concept of democracy may need to be revisited...

Will it be a great idea to provide free or very low cost food grain to a large section of population? | LinkedIn Answers | LinkedIn

Will it be a great idea to provide free or very low cost food grain to a large section of population?

The National Advisory Council headed by the real political boss Sonia Gandhi has recommended free(or very low cost) food grain supply to the abjectly impoverished population of India. This is estimated to be above 50 million tonnes costing about $20 billion. The government spends $80 billion every year on its employees' salaries most of whom are corrupt, do not provide any service and try their best to sabotage any incipient attempt at freeing up the economy.

Wouldn't it be a brilliant idea to sack 25% of government employees and spend the money saved on providing food grains to the starving undernourished millions....time for Sonia Gandhi to bite the bullet?

If this is done, significant road blocks would vanish, the economy would grow sufficiently faster to not need so much free grains in a few short years.

Which is the more harmful for India? | LinkedIn Answers | LinkedIn

Which is the more harmful for India?

It is estimated that Indians have stashed away $1400 Billion in banks abroad. Much of this may be from corrupt politicians and their crony businessmen who have been salting away ill gotten gains for decades.

At the same time a corrupt bureaucracy which does little except blocking free economic activity keeps getting paid $80 Billion(almost 40% of total government expenditure) as salaries and benefits every year which is paid by common people in the form of taxes and inflation.

Some part of the $1400 Billion stashed away abroad may be by normal business people to fund business activity abroad as India still does not have free capital flows out of the country and this may save them hassles and time and therefore may even be beneficial to the country.

Which of these two categories...money being surreptitiously sent abroad or money being spent on corrupt government machinery would be more damaging for India's economy?

I tend to believe that the second seems the larger evil....

Who will win...US & Europe, China, Both or Rest of the World? | LinkedIn Answers | LinkedIn

Who will win...US & Europe, China, Both or Rest of the World?

The US Fed prints dollars(and ECB prints Euros) and sprays them (with or without helicopters) on the American (and European) inhabitants.

Americans and Europeans quickly go to China and buy real stuff with these paper or electronic dollars or Euros.

China with its sales revenues in its wallet goes shopping to Australia, Latin America and Middle East for Raw materials and oil. It still has spare dollars and Euros which it promptly lends back to US, Spain, Greece etc.

China wants this arrangement to continue for a while purportedly to keep a lid on social unrest. So the People's Bank buys all the dollars and Euros to keep Yuan from appreciating. This creates huge liquidity in China which encourages very poor investments and asset bubbles in property.

China's purchases inflate commodity prices around the world for which poor countries like India pay through their nose.

Someday Fed and ECB will stop printing. Then what happens.... Will US and Europe start collapsing. Will China stop lending to US and Europe...Will Dollar and Euro fall. . Will China's financial sector collapse under the weight of bad loans.

It seems rest of the world may actually gain from a collapse of US, China and Europe as commodity prices may become very very affordable for a long time to come.

Is printing dollars and euros by fed and ECB a crime against humanity? | LinkedIn Answers | LinkedIn

Is printing dollars and euros by fed and ECB a crime against humanity?

In the past 12 months some essential food item prices have gone up by 100% in some of the poorest countries. This hits the poor the hardest as food consumption is not price elastic and food often forms the bulk of the household budget for these sections of population. At best the poor under nourished billions can only give up eating.

What the US and Europe appear to be basically doing is just monetizing the international status and brand of their currencies.... people in Europe and US are unknowingly benefiting from this continuous supply of free lunch...in the process snatching the meals from the mouths of the really needy in underdeveloped countries....the Bernanke magic seems working in a macabre way...

Sworn enemies like India and Pakistan conduct their trade in USD, so do India and China, Russia and Brazil. It may be time for these emerging economies to shed their myopia and to the extent possible start trading in Yuan or Rouble or whatever....but not in the flood printed USD and Euro....ideally if feasible the OPEC and Japan need to be co-opted as well....

Else this gigantic fleecing operation by US and Europe may drive all others to irreversible penury before they realize it...

The other option is for the Fed and ECB to be controlled directly by the UN....and let the whole world run on common currency. It is just not fair for 600 million people in US and Europe to exploit the other 6 billion outside by paying for their imports with free paper money....

Will removing corruption in India improve its economic performance? | LinkedIn Answers | LinkedIn

Will removing corruption in India improve its economic performance?

It seems a short answer is a big NO....and here is why...

The white accounted GDP of the country is about $1,300 Billion. The central and state governments together have an annual budget of $750 Billion. This means an astonishing 60% of the country's white GDP is appropriated by the governments through taxes, borrowing and money printing. Much of this money is mis-allocated, consumed by a bloated bureaucracy or simply pilfered.

Any other country would have collapsed under the weight of 60% of GDP being channelized through government. The miracle of India is its much maligned so called "black economy" which is at least as large as the known economy. This generates the unaccounted wealth over which the government does not lay its dirty hands....it seems this is what actually saves the country's economy and keeps the white part of it growing at 9%.

All the well intentioned hullabaloo over corruption is actually barking up the wrong tree... even if corruption was reduced to zero, the sheer size of government and its populistic programs would continue to drag down the economy....indeed it could even become much worse....if elimination corruption bring the black economy into the accounted visible economy, the greedy government bureaucracy would be tempted to expand rapidly and thereby drive the last few remaining nails into the coffin...

Doesn't Anna's Movement against corruption (and the Occupy Wall Street movement too) miss the main point. | LinkedIn Answers | LinkedIn

Doesn't Anna's Movement against corruption (and the Occupy Wall Street movement too) miss the main point.

Removing corruption will just treat the symptoms.The real issue is the government itself with or without corruption.

About 60% of India's white GDP passes through Government's clumsy fingers in the form of taxes, borrowings and excess money printed every year. Common man including the starving BPL destitute funds this through inflation and devaluation.

For every extra rupee handled by the government the GDP gets held back from its potential by three rupees.

The much maligned Black money is the only reason Indian economy keeps humming and growing, because the government does not get to touch it.

Even in the US 95% of new jobs are created by startups. Big corporates do not create jobs and big government departments prevent everyone else from creating jobs.

If the government needs to own large sections of the economy (our constitution demands that India be socialist), then it must break up its departments into tiny units (think Panchayati Raj).

Asset ownership (central to the debate between capitalism and socialism) is not important, the misbehavior of the asset owners, whether government or private is. A large private company is still subject to some market control through competition, a large government department is implicitly backed by government guns and tanks and controls the markets it operates in.

That is why unsurprisingly all public services provided by government whether education, health, policing, property titles, legal redressal, are in shambles.

The only large department should be the Armed Forces because it has to fight outsiders. Size is required for that. Other functions should be totally decentralized. Lutyen's Delhi and state equivalents should be auctioned or all structures demolished and land used for growing forests.

Anna has decentralization on the menu, but starting with corruption is putting the cart miles before the horse.

Is it possible to have a welfare state without a huge bureaucracy? | LinkedIn Answers | LinkedIn

Is it possible to have a welfare state without a huge bureaucracy?

Karl Marx, Lenin and Trotsky did not envisage equality being driven by an all powerful state apparatus. That was Stalin's invention....and Stalin could not have been bothered about utopia of communism anyway...he only wanted to feed his own megalomania through the instrument of a pervasive bureaucracy.

Unwittingly all modern states have copied Stalin and created massive state infrastructures. The US in a sense is almost half a Stalinist state as the Government spends 41% of GDP. The figures are not very different for other European countries. So shockingly all democracies pay lip service to liberty and freedom and revile Stalin but then flatter him by copying his methods.

India is worse as Government handles 60% of GDP and the constitution also demands a socialist(meaning Stalinist) structure. The real aim is to keep the megalomania of the ruling dynasty going. No wonder they pull out all the stops and hyper ventilate when some feeble old man of 74 years starts talking of fighting corruption

China has no confusion. It is a Stalinist state and is proud of it. The state has decided to beat the West and is well on its way to achieving that goal. They do not have the hypocrisy of worshiping freedom and liberty and they surreptitiously overturning these through massive bureaucratic deployment.

Ownership of assets by a few is bad because it gives the owners control of the markets. But ownership of assets by a powerful bureaucracy is worse because they they are backed by guns and tanks.

Guns and Tanks do not help the economy when they are pointed inwards(in support of bureaucracy). These weapons are useful only when used against outsiders. The Chinese have internalized this. Their economy and their guns are synchronized and focused externally...no wonder they are winning.

What is the punishment for corruption by a government person under Sharia Law? | LinkedIn Answers | LinkedIn

What is the punishment for corruption by a government person under Sharia Law?

There has been a lot of debate on deterrent punishment for corruption by those in power. In fact it is a euphemism to call it corruption. It is extortion, dacoity and loot by those in power. It is believed Sharia Laws were very effective in taming lawless societies of medieval times.

It may be a great idea to examine the applicability of similar laws to people in Government in India as their level of accountability is also quite medieval...

Should we have capital punishment for the corrupt public servants in chronically corrupt countries like India | LinkedIn Answers | LinkedIn

Should we have capital punishment for the corrupt public servants in chronically corrupt countries like India

Every time the subject of capital punishment comes up for debate, human rights organizations are up in arms.

Some countries are more corrupt than others not because their people are different, but because their systems are designed to facilitate corruption.

The people who build and fine tune this infrastructure of corruption are the public functionaries and hence need to be dealt with.

Common people generally follow the formal and informal systems and conventions that seem to be working. Germans killed 6 million Jews not because Germans are bad people but because the Nazis designed the system to eliminate Jews. Chinese killed tens of millions of their fellow citizens during Mao's tenure not because Chinese are violent people, but the system encouraged them to do so. The Russians under Stalin did even worse, not because of anything wrong with Russians but because the system was designed that way. Even the gentle Cambodians massacred hundreds of thousands under the Pol Pot regime.

Common people are not corrupt or honest. They just follow the system that works for them. The Indian system of corruption has been put in place by the main beneficiaries of the system. Unless these marauders can be deterred through legal changes, no one will dare to redesign the formal and informal systems.

May be time to take the gloves off and have a referendum on whether to have capital punishment for the architects of the corrupt system

Many will argue that capital punishment has not deterred people from committing murders. True. However everybody is not murdering everyone else. Societies can live with deviants. In the case of corruption, most of 50 million public servants are practicing blatant corruption or rather extortion. In fact many do not even understand that it is a real crime like murder or rape.

It is not possible to punish 50 million public servants. But it is very much possible to hang the designers and protectors of the system

Making the economics of Solar Power work in city centers. | LinkedIn Answers | LinkedIn

Making the economics of Solar Power work in city centers.

One square meter of solar photovoltaic panel costs USD 800...this would come down to about USD 300 in another 7 years.

One square meter of commercial space in New Delhi sells for USD 800. All that the government needs to do is to issue permits to developers to build an extra unit of commercial space for every unit of solar panel installed on their roofs. The city would get plastered with solar panels in a jiffy....and there would be carbon credits to be accrued for the developer as a bonus.

As the prices of panels falls or as the commercial reality rates rise, the permits could be calibrated accordingly on an annual basis.

I wonder if there is any downside to this.

How much is the caste based reservation system in India affecting the Indian Economy? Who will bell the cat? | LinkedIn Answers | LinkedIn

How much is the caste based reservation system in India affecting the Indian Economy? Who will bell the cat?

Identity based reservation system for government and public sector jobs and admissions to technical and professional higher education for the past six decades has firmly pushed the agenda of entitlement to the forefront of public consciousness.Responsibilities, accountability and delivery of service or contract are rendered meaningless with this perverted ethos.

A person from a so called historically deprived caste gets admission to coveted professional colleges, pays no fees, gets generous scholarships, gets a coveted government job for life, does no work, indulges in acts of corruption (actually heinous extortion euphemistically called corruption in India), gets time bound promotion, lives a carefree life, lives in a government colony, pays little rent, enjoys subsidized municipal services, raises a family in a securely luxurious ambiance and then his next generation gets the same treatment all over again.

This is the secret of dysfunctional and chronically corrupt government ruling roughshod over a country with half the population living on one USD a day.

Political parties compete among themselves to add to the reservation quotas year after year. In this cacophony, entitlement to salaries and perks and opportunities for graft become the accepted paradigm of social discourse. Work gets defined as erecting barriers against the productive businesses of the economy to extorts as much juice as possible from the hapless private sector.

No doubt in an agrarian economy, caste based feudal systems did handicap some castes....but cities and towns have no caste system. There is no prejudice against anyone in India's cities....then why cover people raised in cities and towns with an agrarian society's caste based reservations.

Has Germany finally won WW2? | LinkedIn Answers | LinkedIn

Has Germany finally won WW2?

Most of Europe is reeling under debt which it cannot pay back. Germany is enforcing austerity on other countries which will drive them into long term contraction. Internal devaluation in the form of lower wages will be the only way left for these countries to regain competitiveness. At least one generation of South Europeans will be repaying their debts to North European banks by working hard for low wages....somewhat like bonded labor....

Isn't this what Germany broadly set out to achieve at the start of WW2?....to create a European colony for the Germans...to supply inexpensive goods and services to the Germans...

How far is the era of free energy | LinkedIn Answers | LinkedIn

How far is the era of free energy

Solar panels cost about $1000 a square meter....by 2017
These costs will fall to a fraction of that and the cost of power will easily c compete with utility power without subsidies...from there on solar will progress rapidly and energy like the air we breathe will get close o being free....

What would be the implications for fossil fuel companies?

Are the 20 million Government employees of India members of the largest unannounced trade union in the world? | LinkedIn Answers | LinkedIn

Are the 20 million Government employees of India members of the largest unannounced trade union in the world?

Government employees in India do no work, get paid generous salaries and obscene perks, throw their weight around, have large king size egos, obstruct everyone else in the private sector from doing anything legitimate, extort and loot all those unfortunate enough to have to deal with them.

These parasites have full job security, cannot be sacked even for criminal conduct like extorting bribes, have time bound promotions, have inflation indexed salary hikes, their children get preference in admission to elite schools and colleges....and the list goes on and on....

The truth is that India has after the racial British left constructed a brand new caste system...this consists of two castes....the higher caste is the government employees and their friends and the lower caste is the private sector employees including the much envied MNC employees who are wringed dry for taxes....

Can the German proposal for Greece's compliance be replicated across the globe? | LinkedIn Answers | LinkedIn

Can the German proposal for Greece's compliance be replicated across the globe?

Germany has proposed to have a commissioner in Brussels to oversee budget cuts fir Greece to ensure that austerity measures agreed by that country are actually implemented.

Populist governments squandering public money are the rule rather than exceptions across the globe. It is very tempting for democratic governments to appease all those they see as their constituencies or interest groups.

What is perhaps required is an impartial supervision of budget expenses. Of course in the case of Greece the problem has urgency because of common currency whereas other countries like India can devalue by printing their way out of any self inflicted crisis. However devaluation whether internal or external ultimately results in lower relative wage rates and that can be preempted by not overspending in the first place.

Can the UN or IMF some day rise to this challenge.

Will the Supreme Court quashing telecom licences affect FDI in India | LinkedIn Answers | LinkedIn

Will the Supreme Court quashing telecom licences affect FDI in India

The Supreme Court has declared that the122 telecom licenses granted in 2008 were illegal and have to be cancelled.

International players like Telenor have got hit by the ruling. The government says that it welcomes the court decision and the resulting policy clarity that this brings...if anyone has been aggrieved they can go back to the court for compensation. However the courts would never compensate anyone for lost opportunities...

The fact is that the licenses were given away cheap and profits were made by those who sold the licenses to investors like Telenor. By cancelling the licenses, the beneficiaries retain their ill gotten profits and good faith investors like Telenor lose the licenses....

Natural justice would suggest that those who were wrongly benefited should regurgitate the money and pure good faith investors should be adequately compensated for their investment and efforts...but apparently there is no way to make it work that way...

Clarification added 2 months ago:

The broader issue here is that an organization has many stakeholders...not just the shareholders...there are the customers, suppliers, employees and the proximate society...when the courts discontinue a company's operations, they are punishing the other stakeholders for the crimes of the shareholders who are in management...an example is a hospital or education college....if the management of a college does something illegal closing the college hurts the students more than anyone else...

In the telecom case, the best way would be to confiscate the share of those shareholders who were in management at the time the crime was committed and auction these shares to the highest bidder with proceeds of the auction going to the public exchequer....but let the company business continue...this way the government would recoup a significant part of the loss from giving away spectrum cheap and good faith investors who came to the scene later would not lose out entirely...

Social media sites are being targeted in India by the establishment. Is there any way the International community can hit back...e.g. by blocking India from the net... | LinkedIn Answers | LinkedIn

Social media sites are being targeted in India by the establishment. Is there any way the International community can hit back...e.g. by blocking India from the net...

Social media sites are targeted by explicitly authoritarian regimes like China and pseudo liberal countries like India. It is time the International community knocked some sense into these countries. Best would be to disconnect illiberal regimes from the Internet. It would immediately solve the job loss problem of the US in off shoring and throttle the flood of intellectual property that is freely consumed by these countries on the net.

Much of the export trade in hard currency that India manages is for software. The software industry flourished in India because the government understood very little about it and could not strangle it in time...This would be excellent opportunity for the US and Europe to hit back by banning all software imports from India as the country is well on its way to revealing its anti democratic instincts...

The costs of software would go up, but then it would be for everyone and no particular country would be affected competitively.

It is important for the West to fight for liberty and freedom and be especially wary of pretenders like India who have been wallowing in the caste system for 2500 years and have created another caste system of establishment vs the rest in this modern day and age.

The establishment in India is day dreaming that the social media companies are doing business in India and therefore have no choice....the government would like them to proactively remove all content that does not speak well of the government...like the captive government television channels and radio....they are using the fig leaf of "objectionable anti social content" to torment the social media companies....I am surprised that Obama and the EU has not woken up to this brazen attack on freedom by their friends in the Indian government so far...

When the private sector deleverages, does the government have to compensate by higher deficits? | LinkedIn Answers | LinkedIn

When the private sector deleverages, does the government have to compensate by higher deficits?

The conventional wisdom seems to suggest that when private sector stops spending, the government must step in to keep consumption going...is this model really workable...when the private is usually sector spends, it is always well accounted for in therms of sound economic principles...there might be investments which will fetch returns later on, there might be salary increases to match market rates for labor, there might be higher working capital to reflect higher volumes or prices...

However when the Indian government spends more, it is for salaries of bureaucrats who do no work, it opens more schools where unionized teachers' productivity is a fraction of their private counterparts, ditto for government hospitals where medicines are pilfered and sold in the black markets, ditto for the public food grain distribution system where the bulk of the supplies are diverted to the black markets and some even exported to neighboring countries....

Subsidies for kerosene fuel are used for adulterating diesel fuel in commercial vehicles thus damaging their engines, Employment guarantee schemes are packed with bogus payments to non existent workers....even the payrolls of municipalities like the Delhi Municipal Corporation have a vast number of ghost workers...people who either do not exist or just take salary credits to their accounts without them even knowing about it...someone else operates these accounts....

So if the private sector deleverages, at least in India the response must be to cut government expenses to reflect lower tax collections...not a stimulus towards increasing government staff salaries...that is what the government did in 2008 and the birds came home to roost in 2011 in the form of double digit inflation....

Could the crash of 2008 have been avoided by simply declaring CDS transactions illegal? | LinkedIn Answers | LinkedIn

Could the crash of 2008 have been avoided by simply declaring CDS transactions illegal?

An insurance product spreads risk of the buyer to a large population of subscribers. When you buy a medical insurance, in the event of your needing surgery, the bill is footed by all the subscribers to that product.

In the case of a bank buying CDS to insure against a credit default, the bill is not being paid by a large population of other creditors but by a single counter party who is also another financial intermediary and may have also bought CDS for its own credit default insurance ...therefore CDS is not an insurance product at all but just a form of gambling...there is no spreading of risk happening...

Now the Europeans are actually extinguishing CDS in a round about manner....the 75% voluntary haircut is designed to avoid invoking of CDS....

Why not just outlaw all CDS transactions unless these are re-insured by the Fed or ECB who have printing presses....

If creditors do not have a false sense of security from CDS, they would be more careful in transacting with Greeces and Portugals....the cost of credit for these countries would be what it needs to be....it would be a self correcting mechanism...

Should the State have any role in economic development and evolution of society in modern times? | LinkedIn Answers | LinkedIn

Should the State have any role in economic development and evolution of society in modern times?

Most problems of corruption, mis-allocation of capital, bureaucratic red tape, top heavy governance structure, poor distribution of public goods, poor re-distribution of wealth etc...happen because at the root of it all lies the medieval and feudal assumption that the state must foster economic and social development of society...

The immediate excuse for state role in economy is that markets are not very good at redistributing wealth....hence the state must progressively tax and give to those less fortunate...is this supported by facts?...

If markets are found not good at redistributing wealth, surely the solution lies in addressing that weakness of markets rather than usurping that role and giving it to governments...

As an illustration if Bill gates gets enormously rich by inventing and selling software, the solution lies in creating more competition by shortening the copyright or patent duration for the software that he sells...not by taxing him more....the cause of the problem needs to be addressed not the consequences...

Most public goods can be delivered by free markets....the era of natural monopolies in electricity, water supply, telecommunications is long past with inventions in distribution logistics...few domains like defense, roads and policing remain...

In India the real private sector is the government sector...it enjoys monopoly, price preference, free land and other subsidies....the employees cannot be sacked, they never deliver therefore...contracts are routed to government favorites...and so on...all at the cost of the poor public who is continuously bombarded with the lie that the government sector is the public sector because the ownership is with the public...

Isn't it time to redefine what is really private and what is public...based not on the ownership but on the behavior of managements...

Sanjay Negi's Musings

Saturday, April 14, 2012