Category: Corruption

World Bank Complicit in Indian Corruption

A recent Wall Street Journal article, World Bank Disgrace, (hat tip: Prakash Advani) reports that an internal review of five WB health projects in India totaling US$ 569 million in loans shows major corruption. The report begins with

Credit Robert Zoellick for knowing how to put the best face on a profound embarrassment. On Friday, the World Bank president announced in a press release that the bank had “joined forces” with the government of India to “fight fraud and corruption” in that country’s health sector. This is happening at the same time that Mr. Zoellick’s colleagues are hounding bank anticorruption chief Suzanne Rich Folsom, the person primarily responsible for bringing the scandals to light.

Joining forces with the government of India to fight corruption is reminiscent of joining forces with General Musharraf to fight terrorism. One bank managing directed is reported as saying that she is “encouraged by the Indian government’s “strong resolve” to deal with corruption.” Exactly like the strong resolve of the fox in guarding the hen house. We can now all sleep soundly since the Indian government has resolved to . . . whatever.

If your corrupt government is strongly resolved to deal with corruption, you might be a third world country.

PS: Let’s remember that all the stolen money is a WB loan to India. That means, we, the tax-payers in India, have to ultimately pay back all the embezzled funds.

The Banality of Corruption

The facts are pretty simple to state. A piece of land was sold by party A to party B for Rs 22 lakhs. The official price was Rs 7 lakhs, less than a third of the actual amount that changed hands. That means A received Rs 15 lakhs which he cannot account for. And it also means that B paid Rs 15 lakhs from sources which are also unaccounted for. Then parties A and B arrived at the land registration office to record the new title. The registration fee is 10 percent of the sale price, or Rs 70,000. Party B paid that. But that was not all. Also paid to the clerk in charge of recording the transaction a 20 percent bribe, or Rs 14,000. Only a part of that bribe goes to the clerk. The rest goes up the chain of command all the way up to the chief minister of the state. This is common knowledge.
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National Rural Corruption Guarantee Scheme

Over two years ago, in Aug 2005, I had written that the national rural employment guarantee scheme (NREG) will ultimately end up increasing the number of poor and deepening poverty — which of course was easy enough to predict since the policy is “pro-poor” and like all policies “pro-” something do, increases that something.

The NEGS is not novel. Maharashtra has had an employment guarantee scheme for decades. According to Sharad Joshi, it “has produced few permanent assets. And the EGS in Maharashtra is synonymous with corruption. Government officials concoct false registers of attendance.”

Corruption is not unexpected when money is involved and the transaction is between officials who have the power and control over the money, and the poor unemployed labor who would be willing to take only a share of whatever is due to him or her. It has been variously estimated that only about 25 percent of any relief money actually reaches the intended beneficiary. Politicians and bureaucrats steal the majority of funds.

Now reports are surfacing that the damned scheme is beset with corruption. That news would surprise you if you are in the habit of being surprised to learn that bears shit in the woods, or that astrologers prey on the gullible.
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Power, Scarcity, and Corruption

Education in India is generally in dire straits even though some people mistakenly believe that it is excellent from the successes of some ex-IIT non-resident Indians in the US who made piles of money. It is not hard to figure out what is the root cause of the distress of the educational system in India: the near-monopoly control of the system by the government.
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Open Question

Caesar’s wife must be above suspicion. But only if Caesar himself is above suspicion. What if Caesar is way way below suspicion? Shouldn’t you expect that his wife will also not be above suspicion?

Think about it.

We, the People

One is forced to the generalization that at the level of the individual it is all exogenous, while at the level of the society, it is all endogenous. Take the market, for instance. To an individual, price is something that is a given and whether he or she participates in the market or not, cannot change the price. Price is determined externally and is indifferent to the efforts of the individual. It arises from almost magically from the collective interactions of the individuals in the market. Price arises out of, and is a reflection of, “the collective will” of the people, so to speak. Prices are democratically determined in competitive markets. Which brings me to the other example of the generalization above: governance.
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Dr Frankenstein, I presume

The makers of monsters and their fates are inextricably tied, both in fiction and in real life. Dr Frankenstein’s monster. Dr Faustus. Mrs Gandhi, the elder and Sant Bhindranwale. The CIA and Osama bin Laden. The CIA and the Taleban. Add your own favorite examples.

Dr MM Singh. VP Singh. The monsters created for gaining political power by legislating divisions of the country along caste and religious lines are beginning to have a life of their own.

Soon to be released, the sequel to the hit drama, “August 1947: The First Cut.” New updated imported Gandhi. Bigger bombs. In production, “August 2017: The Final Cut.” Totally new cast, with hundreds of specially recognized castes. Supporting mega roles by ISI in Bangladesh and Pakistan. Islamic terrorists and RDX will blow you away. You can’t miss it. You won’t be able to.

Police and Politicians

If this report from Tehelka about the complicity of the police in the Nithari serial killings does not outrage you, check your pulse–you may be brain dead and therefore be qualified to be an Indian political leader.

Dividing India

Surendra Kaushik is a professor of finance at Pace University in New York. His article Do Not Reinforce Two Indias is worth a read. Continue reading “Dividing India”

Abhorrent Discrimination

A Letter to Dr Manhoman Singh

If there is one thing that makes me see red, it is senseless discrimination in general and unfair treatment of people. But when it comes to discrimination based on a person’s religion, I abhor it with every fiber of my being. It disgusts me and I feel nothing but contempt for people who discriminate based on religion (or lack of religion, in some cases.) One of the distinguishing features of a civilized society is that it does not treat people differently based on their belief systems. Those societies that do discriminate based on belief systems are retrograde, regressive, backward, ignorant, bigoted, intellectually bankrupt, and generally deserve the derogatory label “third world country.”
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