Is China better at capitalism than America?

Conventional wisdom holds that Uncle Sam's free-market model is the best in the world. But China's growing clout is causing economists to think twice

The 1991 collapse of the Soviet Union seemingly put to rest any doubts about the supremacy of America's capitalist system. Guided by the magic hand of the market, the U.S. had created more prosperity than any other country in history, while the Soviet system crumbled under the weight of its creaky, bureaucratic machine. But the subsequent rise of China, whose economy combines aspects of capitalism and central planning, has thrust the U.S. model under new scrutiny. While Uncle Sam continues to limp his way out of the Great Recession, China has hardly broken its stride. Is China's brand of capitalism simply better than America's?

Yes. China is winning the future: China is smoking us, says Zachary Karabell at The Daily Beast. Both the U.S. and China engage in a lot of government spending, but China puts its money into infrastructure, transportation, alternate energy, and housing, all of which "will yield long-term benefits for the Chinese economy." The U.S., on the other hand, spends on "consumption, safety nets, and the military," which comprise a shakier foundation for economic growth. The "sclerotic inability" of the U.S. government to "productively invest for the common future" is the reason why its "form of capitalism has ceased to fulfill hopes, dreams, and needs of far too many people."
"China's not the big trade cheat harming America's domestic economy"

Nonsense. China's system is a pale imitation of ours: It's fashionable to proclaim that China "is eating our lunch," says Ian Bremmer at Reuters, but it's all "baloney." Just look at the way Chinese manufacturers "copycat everything foreign, from cars to watches to iPhones to social networks." The Chinese system will never "foster the entrepreneurial spirit" that makes these innovations possible, because the drearily unimaginative state is the "majority owner" of the economy. China has been able to "shoehorn a crude version of a beautiful financial system into its state-controlled economy and get some good results." But it will never be able to replicate the breakthroughs that are the hallmarks of a true free-market system.
"Chinese capitalism is just another knockoff"

Either way, the U.S. can learn from China: At every turn, America sees "ideological hang-ups standing in the way of what everyone realizes must get done" in investment and education, says Michael Schuman at TIME. In that sense, we could learn a lot from China, which dispassionately puts "pragmatism and problem solving over ideology." That's the Chinese model America should adopt: "Dropping the political bickering and ideological grandstanding and doing whatever is necessary to create prosperity."

Who is spying on Pakistan's spies?

Rob Crilly is Pakistan correspondent of The Daily Telegraph. He blogs excerpts from recently released Wikileaks files. The story of Kamran Bokhari's visit inside the ISI HQ in Islamabad and his brief meeting with agency’s chief Lt. Gen. Shuja Pasha.
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It is not often we are allowed a glimpse inside the shadowy world of Pakistan's Inter-Services Intelligence (ISI) agency. So amid all the humdrum dross, poorly sourced rumours and conspiracy theories in the Stratfor emails obtained by Wikileaks, it was a delight to discover an account of a meeting in April last year with Lieutenant-General Ahmad Shuja Pasha, who retired as its director general at the weekend. Analyst Kamran Bokhari describes the tight security at the ISI's lair in Islamabad and its smart premises:

Once after the main barrier, which is an iron gate you enter the courtyard of the new main building adjacent to the old ones. A really fine structure recently completed when the current army chief was heading the ISI and Musharraf was in charge – from the inside it resembles a 5-star hotel in terms of the quality of the interior finishing.

There's an interesting discussion about Afghan policy, Libya (apparently Gaddafi asked for help – no surprise given the two countries' close relationship) and the Raymond Davis debacle. Then it's time to leave…

At this point I asked him if there was any change to his email address and Pasha says I am sorry I have not been in regular touch over email because these people were reading my messages and I had to have my pc cleaned but I am still using the old email address. I asked who was reading his emails and he replied there is only one entity in Pakistan who can do that. (I take it he meant people from within the directorate were doing so).

So even the head of Pakistan's all-powerful ISI is apparently being spied upon. Perhaps by people within his own directorate. Or maybe he's simply trying to implant the idea that there are rogue elements at work, allowing him, his agency and Pakistan to play a double game with their allies in the West.

That's the thing about spies. Nothing is ever quite as it seems.

What ex-newspaper editors would have done differently

Veteran Tribune Co. and Chicago News Cooperative editor James O’Shea tells Nieman Reports:

Journalists of my era often responded to the challenges posed by the industry’s shifting business model with the retort: “That’s a business side problem.” More often than not, though, the business side’s answer was budget cuts that diminished journalism. Tomorrow’s newsroom leaders must take responsibility for the success of the enterprise by convincing themselves, readers and owners alike of something that has always been true: Good journalism is good business.

American Journalism Review asked editors the same question in 2002. Here’s what they said then.

India’s Crumbling Cities

Just give it a try…! Type “India’s dying city” on Google, and perhaps, I was not surprised to see the search engine leading me to pages on Kolkata, once the city of joy. Mahatma Gandhi described Calcutta as a dying city and the Indian-Caribbean writer V.S. Naipaul describes Calcutta as a city without future with the words: "All of its suffering are sufferings of death. I know not of any other city whose plight is more hopeless". But, Shreyasi Singh feels, Kolkata is just a symptomatic of a larger malaise affecting our cities.

One of the best things about Kahaani – the Hindi thriller that’s doing spectacularly well at the box office these days – is the way the bustling metropolis of Kolkata (once Calcutta) has been captured.

Cinematographer Setu has filmed the city in all its manic glory – people-filled streets, the grime of a city that has seen better days, and the sudden and unexpected beauty of a well-lit Howrah Bridge, an iconic Kolkata landmark, in the evening. That the movie is set over the span of a week or so during the Durga Puja festivals, the biggest festival of the Bengalis, just amplifies the sights and sounds in the movie.

Yet, while watching the movie – transfixed as I was by the smart storytelling and tight plot – I couldn’t help but think that the while the cinematographer deserves praise for his excellent work, India has generally failed when it comes to the look of our cities today.

Beyond romanticizing the “soulfulness” of a crumbling, but spirited city, the failure in administration of our urban areas is almost criminal. Kolkata isn’t alone. Barring Delhi and Hyderabad, where there have been tangible infrastructure enhancements, our other big cities – especially Bengaluru and Mumbai – are falling apart before our eyes.

In December 2005, India launched the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), the largest national urban initiative to encourage reforms, and it fast tracked plans for the development of 63 identified cities. As the JNNURM report stated, according to the 2001 census, India had a population of 1.03 billion, with approximately 28 percent of those people living in urban areas. By 2011, an estimated 65 percent of India’s gross domestic product was coming from urban areas, and by 2021, more than 40 percent of the total population of the country is expected to reside in urban centers.

As that happens, our cities need to be braced and prepared to handle this influx. If Kahaani’s realistic portrayal of Kolkata is a snapshot of what one of our biggest cities looks like, our preparedness seems less than satisfactory.

Dilli Dur Ast

Why Third Front is an idea with very little practicality, and most often no production viability

It’s a chair everyone wants to sit and fit in. So, it was not surprising when India Today magazine got the issue on its cover page. The story titled, “Will UPA survive this summer?” ponders upon various permutations & combinations around the new government formation. The issue has come to the forefront after drabbing performance by the incumbent UPA (read Congress) government in the recently held state polls. Despite prime minister brushing aside possibility of mid-term election, the political circle is abuzz with possibility of snap polls. Congress at this juncture definitely doesn’t wants to jump into poll fray, same for the BJP. With two of the biggest national parties unwilling to test their mandate at this juncture, regional forces have started indulging in the fantasy of a third alternative in the prevailing mood of the nation.

Indulging in fantasy of Third Front is not new in country’s politics. We saw it just before the 2009 general elections, when political pundits almost made UPA sit in the opposition. Several compromising candidates for the Prime Ministerial job were popped-up, ranging from Dalit leaders Ram Vilas Paswan and Mayawati to OBC stalwart Sharad Yadav. Later UPA without support from left and with help from other regional allies including DMK and TMC came to power. The dream died in its bud.

Almost all the regional satraps foresaw the results of assembly elections. No surprising, much in advance, they declined to toe Congress’ line on various issues including Lokpal Bill, the provisions of NCTC, the FDI and others. Regional cards were played with full acumen; issues of federalism vs. centre’s control were popped up. Naveen Patnaik was seen drafting letter on Mamata’s behalf over NCTC issue and Nitish Kumar and Jayalalitha joining the axis under West Bengal CM’s leadership. Taking Mamata on-board gave some definite edge to the possibility of what was in the store. And the possible die was cast on 6^th of March, when results stated pouring in from various states. Congress, except Uttarakhand and Manipur, was the clear loser. Party’s expectations were dashed, the party was on back foot. Decimated Congress boosted this desperate group of would be PMs, sticking together just to be in the power. Return of Mulayam Singh Yadav in UP, who earlier served as Defence Minister, in HD Deve Gowda led similar front, boosted their confidence. And after the return of the Akali Dal-BJP combine in Punjab, talk of a new federal front has only intensified.

Third Front is not an alien concept to Indian politics. The Janta Party was the first non-Congress party which came to power in Delhi and since then India has seen five experiments on the line. None of these experiments were based on majority by the coalition partners. If we look at the numbers garnered by these parties in the current Lok Sabha, their combined strength adds up to 222, minus the BJP, which falls short of the 50% mark. It is also obvious that many of these parties, such as DMK and the AIADMK or the SP and BSP can’t see eye to eye. So the rational figure goes further down to less than 100 seats, impossible to offer a viable alternative.

There is a bigger inherent weakness which is glossed over when the going is good (i.e., when the romance is at an early stage) and which rears up in an ugly fashion when the honeymoon is over. Each of these regional chieftains is ambitious, i.e., they would all like to be prime minister. Their logic is—if someone like Deve Gowda, a complete outsider to national politics can make it as a compromise candidate (ditto for I.K. Gujral) why not me, who runs a state government and can deliver a handful of Lok Sabha seats? In this too many chiefs, not enough Indians situation, the ambitions of these regional bosses will cancel each other out.

Also the contention that regional parties are losing is not supported by outcome of recent polls. Both in UP and Punjab, the Congress’ vote share went up.

This will not stop the Third Front idea from gaining traction, because that is propelled by an antipathy towards the Congress and suspicion of the BJP. And given the peculiarities of our system, a minority government could, with some informal help from outside, come to power, even if its durability would remain suspect. But the cheerleaders of yet another front would do well not to get overexcited; Delhi is still far away.

Statspeaks - Is Virat the new Sachin?

Note: The figures are till the end of the innings in which 3000-run mark was achieved.

20 Seconds read: Star- struck

Once in my childhood Maa (mother) slapped me for playing evil. I was sad and started looking towards stars. "I was one of those stars," so I believed. One of my cousin had died few days back and whenever I asked Mom, where she has gone. She uses to raise her finger towards a star. Loadstar…!

Today is exactly 25-years since she's a star, a rockstar and me the mortal.

Omita knows it better

How a 73 batch IIS officer has emerged as India's most powerful bureaucrat

I have been twice to the Finance Ministry. First in 2004 when I was still trained as a journalist and again in 2010 while assisting my boss for pre-budget interview with the Finance Minister. The secrecy was in the air as Babus were too busy with their files. “Dada” as Pranab Babu is lovingly called reached our interview set exactly on time, even before our anchor reached the spot. During the interview, I discovered a lady in her mid-fifties sitting among us, almost guiding finance minister on “what not to say.” We left the finance ministry in a huff after that as I have to rush with the tape to the studio. The lady slipped out of my mind.

After a week I spotted the same lady on TV screen standing authoritatively beside Pranab Da. It’s then when I asked my boss- Who’s she? With a grin on his face he replied –“aap nahi jante?”. She is Omita Paul. Paul, a Bengali surname, made me believe for a moment that she is better-half of our FM..! And that’s true, pardon my ignorance but that’s exactly the first thing which came to my mind.

Fast forward 2011, Economic Times published a story titled, “Why North Block can't do without Omita Paul.” The newspaper quoted Pranab Mukherjee saying to his officers, "Omita knows the way I want to express it." Pranab was informing his officers on how Paul was indispensable when it comes to writing his budget speech. Pranab’s comfort with Paul speaks volume about the kind of working chemistry Omita has with her boss. Her relation with Pranab Babu goes back to late 70s when this 1973 batch Indian Information Services officer was under secretary in the Commerce ministry and Pranab Babu was Finance Minister with additional charge of Ministry of Commerce and Supply. Omita was OSD in the Planning commission from June 91 to May 96. Not surprising it was the same time Pranab Babu was deputy chairman of the plan panel. Moving forward Pranab was Commerce minister from June 93 to Feb 95. Omita was OSD to the Commerce minister during the period. In 1995-96, Pranab Da was holding the External Affair portfolio, Omita was OSD to the Foreign Minister. Between 1996 and 2004 Congress was out of power and Omita was relegated to the Information services job. From the post of DPR in PIB to ADG in DD, Omita was left out of policy making process until a fine day in 2004, when NDA lost to UPA in the General election held that summer. Smiling Pranab Babu enters Defence Ministry on 23^rd May 2004, and in November the same year Omita was assigned the duty to advise honorable Raksha Mantri. Omita was back with a bang. From OSD to Advisor of the Union minister, it was a huge promotion of sort. Pranab Da took her along to MEA and finally she landed in the Finance Ministry in May 2009.

“Madam,” as Omita is addressed by officers in NB - with love or with contempt- has carved out for herself an unprecedented space in the ministry. Though largely unknown to the aam taxpayers of this country some developments have brought into sharp focus the nature of Paul’s “overwhelming role” in the Finance Ministry. And slowly revolt is brewing against Omita Paul. Some officers are up in arms though still not openly but they are speaking up their minds in private conversations. They are questioning Paul’s expertise in managing micro financial niceties. Her qualification is under severe scrutiny. More than bureaucrats it’s the technocrats who are feeling “insulted” as FM puts aside their recommendations over Paul’s on many vital issues.

It is also interesting to note that how Omita Paul describes her role in the ministry. Talking to journalist in June this year she said, “It's a description of herself that Paul says she fails to recognise. " My job is to advise the FM and whenever I'm asked to work on something, I do it. My job is not different from any other bureaucrat ." Perhaps while describing her role Paul conveniently forgot to add that it was she who pressed Pranab Babu in taking back his resignation on the issue of Fin Min’s 2G note issue. And Pranab Babu obliged..! Can Ms Paul explain which other bureaucrat in the country has the guts to press the finance minister to take back his resignation?

Why was Bhave not given extension?

The exit of CB Bhave from SEBI also put the role of Omita Paul under scrutiny. Bhave is widely credited for improving the quality of operations and investigations at the market regulator. After completion of his three-year term Bhave was given extension for next two-year. But this decision was quickly rolled back and UK Sinha was made the new SEBI chief. Paul out rightly denied any role in Bhave’s affair. She said, "The suggestion that I or any bureaucrat can influence that is absurd. You are making me out to be more powerful than I really am. It would certainly not happen under this finance minister. He does not interfere in appointments or functioning of these institutions."

A PIL filed in November this year by a group of retired high-ranked government functionaries — including former CBI Joint Director BR Lall, former Chief of Air Staff S Krishnaswamy questioned the appointment of Sebi chief UK Sinha, and especially the creation of a selection panel that gave too much power to the finance ministry, and possibly done under the influence of corporate interests.

“There are clear indications that there is a nexus between the ministry of finance and major corporate players and that free and fair functioning of Sebi is no longer possible”, said former Solicitor-General Gopal Subramaniam, who represented the petitioners. The PIL said the denial of an extension to former SEBI chief CB Bhave was indicative of the ministry’s attempts to influence the market regulator. Among other things, Abraham said that Mukherjee’s office, and especially his advisor Omita Paul, were trying to influence many cases before Sebi, including those relating to Sahara Group, Reliance, Bank of Rajasthan and MCX.

Why income –tax exemption for members of UPSC?

Former Delhi Police commissioner and husband of Omita Paul, KK Paul is a member of UPSC. In the 2011 budget proposals Mukherjee granted income-tax exemption on certain allowance to members of UPSC. As a result, UPSC members came to enjoy an exemption hitherto reserved for posts such as the chief election commissioner and judges of the Supreme Court. As usual Paul said she has nothing to do with this. "There was no file on that which I would have seen. I have nothing to do with it." "I'm amused even by the suggestion that I need to be involved in something like this. UPSC is a constitutional authority.

I had a cursory glance at her Biodata and on record she doesn’t have any experience or formal education to be the advisor to the Finance Minister. Paul is M.Sc in Chemistry from Punjab University. She did her Bachelors in journalism (and possibly this degree would have helped her in getting her IIS job). She has also attained Advanced professional programme in public administration at IIPM, New Delhi (This is also a must for every bureaucrat in the country). Interestingly her qualifications also include ILO symposium on information technologies in the Media and Entertainment Industries. ..! Her CV credits her with editing books including Work Culture in India and Executive Motivation and Human Resource Planning in Airlines –an Asian Experience. Do these qualifications qualify anyone to hold sensitive and important post like advisor to the Finance Minister of largest democracy?

No one would have questioned the credibility of advisor to the FM if finances of this country would have been managed well. But looking at the mess country’s finance are in, some questions naturally arises as to who is advising our Finance Minister?

Can beggars be choosers?

Sourced From: Dan Ariely's blog

One day a few years ago I passed a street teeming with panhandlers, begging for change. And it made me wonder what causes people to stop for beggars and what causes them to walk on by. So I hung out for a while, engaging in a bit of discreet peoplewatching. Many people passed the beggars without giving anything, but there were a few who stopped. What was it that separated those who paused and gave money from those who didn’t? And what separated the more successful beggars from those who were less successful? Was it something specific about their situation, or their presentation? Was it the beggar’s strategy?

To look into this question, I called on Daniel Berger Jones, an acting student at Boston University who had just finished hiking around Europe. Not having shaved in months and already looking pretty scruffy, he was ready for the job (plus as part of his training to be an actor I figured it would be good for him to learn how to beg for money – at the time he did not see that particular benefit). So I found a street corner and placed him there to take on the panhandling trade. I asked Daniel to try a few different approaches to begging and to keep track of the approaches that made him more or less money. (Of course, after the experiment was over we donated all the money that he made to charity). The general setup was what we call a 2×2 design: When people walked by, Daniel would either be sitting down (the passive approach) or standing up (the active approach) and he would either look them in the eyes or not. So there were times when he was 1) sitting down and looking people in the eyes, 2) sitting down and not looking people in the eyes, 3) standing up and looking people in the eyes, or 4) standing up and not looking people in the eyes.

Daniel got to work, scrounging for money. He stayed on his corner for a while, trying the different approaches. And it turned out that both his position and his eye contact did, in fact, make a difference. He made more money when he was standing and when he looked people in the eyes. It seemed that the most lucrative strategy was to put in more effort, to get people to notice him, and to look them in the eyes so that they could not pretend to not see him.

Interestingly, while the eye contact approach was working in general, it was clear that some of the passersby had a counterstrategy: they were actively shifting their gaze in what seemed to be an attempt to pretend that he wasn’t there. They simply acted as if there was a dark hole in front of them rather than a person, and they were quite successful at averting their gaze.

At some point, something very interesting happened. There was another beggar on the street – a professional beggar – who approached young Daniel and said, “Look kid, you don’t know what you’re doing. Let me teach you.” And so he did. This beggar took our concept of effort and human contact to the next level, walking right up to people and offering his hand up for them to shake. With this dramatic gesture, people had a very hard time refusing him or pretending that they did not seen him. Apparently, the social forces of a handshake are simply too strong and too deeply engrained to resist – and many people gave in and shook his hand. Of course, once they shook his hand, they would also look him in the eyes; the beggar succeeded at breaking the social barrier and was able to get many people to give him money. Once he became a real flesh and blood person with eyes, a smile and needs, people gave in and opened their wallets. When the beggar left his new pupil, he felt so sorry for poor Daniel –and his panhandling ineptitude– that he actually gave him some money. Of course Daniel tried to refuse, but the beggar insisted.

I think there are two main lessons here. The first is to realize how much of our lives are structured by social norms. We do what we think is right, and if someone gives us a hand, there’s a good chance we will shake it, make eye contact, and act very differently than we would otherwise.

The second lesson is to confront the tendency to avert our eyes when we know that someone is in need. We realize that if we face the problem, we’ll feel compelled to do something about it, and so we avoid looking and thereby avoid the temptation to give in and help. We know that if we stop for a beggar on the street, we will have a very hard time refusing his plea for help, so we try hard to ignore the hardship in front of us: we want to see, hear, and speak no evil. And if we can pretend that it isn’t there, we can trick ourselves into believing –at least for that moment– that it doesn’t exist. The good news is that, while it is difficult to stop ignoring the sad things, if we actively chose to pay attention there is a good chance that we will take an action and help a person in need.