Blowin' In The Wind

Suharto and IMF: It's different now

Former Indonesian president Suharto (photo Washington Post) died two days ago, less than a month after Citgroup was bailed out by the Government of Singapore Investment Corporation (GIC) and other sovereign wealth funds. It's a reflection of how the world has changed.

Recall the 1997 Asian economic crisis when the Thai baht collapsed dragging down other Asian currencies, including the Indonesian rupiah. Suharto needed aid from the International Monetary Fund and other donors who forced him to cut public services and subsidies. That heightened public discontent over government corruption and political repression and Suharto was forced to step down in May 1998.

Now the IMF no longer wields that kind of power. It has money problems of its own, noted The Economist:

By 2010 it projects a budget shortfall of about $370 million a year.

Andrew Crockett, former head of the Bank of International Settlements,(said):  “The fund does well when the world economy does badly” ... Since it charged its borrowers more than it paid its creditors...

But the fund's interest earnings are drying up as it struggles to find new takers for its money. Instead of relying on the fund, emerging economies are insuring themselves by amassing reserves of their own. Some, such as Brazil, Argentina and Indonesia, have paid off their IMF loans early, at a cost, to rid themselves of its “stench”, as some people put it. Now, a loan to Ankara accounts for two-thirds of its credit outstanding: the IMF is, in effect, the Turkish Monetary Fund.

Businesses today can get as much money from sovereign wealth funds as the IMF gave to countries in distress. In August 1997, the IMF came up with a $23 billion rescue package for Indonesia. GIC alone has injected $16 billion in Citigroup and UBS recently.

The funds are now in a position to influence the market much like the IMF did in the past. And that has become a matter of concern because, unlike the IMF, most of the funds are not obliged to disclose their activities. GIC, which manages Singapore's foreign reserves, is a private company, It is now thinking of reporting its activities but "probably it won't be every year", GIC deputy chairman Tony Tan told The Straits Times.

He explained GIC had the money to invest in Citigroup and UBS because it decided to convert some of its equity holdings into cash in the third quarter of 2007:

"we were very worried about the outlook for the economies and the markets", he said.

GIC was well ahead of the curve. The market was booming at the time. The Singapore economy grew 9 percent in the third quarter before slowing down to 6 percent in the last quarter, according to the Singapore government website, Enterprise One.

Technorati Tags: suharto,imf,sovereign wealth funds

India: A partial story

Temptations Of The West by Pankaj Mishra

A young man at an Indian university library chanced upon a book that changed his whole life. He wanted to read everything by the author and all the things he had written about. He ended up in America, writing for the New Yorker, New York Times and the New York Review of Books.

The young man was Pankaj Mishra (photo from Columbia website about him), and the writer who changed his life, Edmund Wilson. Mishra describes what a deep impression Wilson made on him in Temptations Of The West -- it's the best part of the book -- but not how he ended up in America. Instead, he describes the India he left behind and his subsequent trips to the subcontinent as a magazine writer.

He writes about the plight of Kashmiris, discrimination against Muslims, the spread of Hindu nationalism. His sympathetic accounts of the Kashmiris and the Muslims were appreciated by Pakistani diplomats in India, who gave him a visa to Pakistan, and led Indian intelligence officials to question his parents, he says.

Now, even the Indian government admits there has been discrimination against Muslims. Delhi last year urged the various state governments to recruit more Muslims as teachers, police officers, health and social workers.

And there's no denying the plight of Kashmir. Even the India media has written about voting irregularities and police and military excesses, though it has no love for the terrorist insurgents about whom Mishra has little to say. He writes at length instead about how innocent Kashmiris have been framed, tortured and killed as terrorists.

This is a courageous book.

But Mishra's account of Hindu nationalism is greatly exaggerated. India is not dominated by the Hindu nationalists. They have no influence at all in my hometown, Calcutta (Kolkata), and my home state, West Bengal, where the communists are in power. The fight between Hindu upper castes and lower castes described by Mishra  is virtually unknown in West Bengal. We have intercaste marriages. There are other Indian states where the Hindu nationalists have never come to power. Even in the states where they are strong, they have to compete with other parties and are regularly voted in and out.

But Mishra does not write about West Bengal or other states outside the so-called "cow belt" where the Hindu nationalists are a political force. He focuses on the "cow belt", where he grew up, and Kashmir, which he visited as a writer and reporter. He is a good writer, but this is a lopsided book.

Technorati Tags: pankaj mishra

Republic Day

My son was watching the cricket match between India and Australia on his computer  when I called him at his college in America at noon today (here in Singapore; it was close to midnight for him). Then, about an hour ago, I spoke to my wife in Calcutta (Kolkata). She said she had to go to her college for the flag hoisting ceremony.

India is celebrating Republic Day today. For the first time, they could not hold the ceremony outdoors but had to hoist the flag in the college auditorium because of heavy rain, she said.

How awful, I thought, having to go in the rain for a college function when you could be watching the cricket match on television instead. I am likely to feel more patriotic watching India play than singing the national anthem at a flag hoisting ceremony.

I remember a long time ago the national anthem used to be played at the end of film shows in Calcutta and we had to stand and wait till the end of the song before leaving the auditorium. I just found out that the official version of the Indian national anthem is only 52 seconds long, but it used to seem much longer then.

We never had to sing the national anthem in school, so on the few occasions I did have to sing it, I would stumble over the words and try to lip synch my way out. The flowery language made the words difficult to remember.

The irony is I am a Bengali and the Indian national anthem is written in Bengali -- and not in Hindi, the official language. But it is written in a chaste, Sanskritised Bengali we don't use in everyday language.

It was written by Rabindranath Tagore, whose poems are perhaps more consistently beautiful than those of any poet in the English language. Wordsworth can be boring, but not Tagore. He is the master of euphony. His prose has the grace of Oscar Wilde, Walter Pater and George Santayana while his poetry has to be read aloud to be fully enjoyed like the poems of Dylan Thomas. Unlike Dylan Thomas, however, he can be easily understood -- if one knows the words he uses. His Bengali runs the gamut from the simple to the baroque.

Unlike most Bengalis, I am not fond of Rabindra sangeet, the music of Tagore. Give me rock 'n' roll and the blues any day. And Jana Gana Mana, written in 1911, has that Victorian pomp and grandeur which can be uplifting but also windy.

Why can't we have something more contemporary, I asked myself -- and then I listened to Jana Gana Mana, both the official version, and this video. And I was strangely moved.

(Republic Day marks the adoption of India's republican constitution in 1950 -- three years after independence from Britain. -- BBC. So this video must have been recorded in 2000.)

Hillary for the Times!

Hurrah! The New York Times has come out in support of Hillary Clinton and John McCain! They certainly have the strength and resilience to provide the kind of leadership America needs today.

I admire Barack Obama and John Edwards as well. And I am sorry to see Dennis Kucinich bow out. The Democrats this year have a wealth of choices. Clinton, Obama and Edwards would all make great candidates. But I can see the logic of the New York Times' choice: a vote for experience.

The Republicans also can't be written off if they nominate an independent-thinking proven war hero like John McCain. 

More than national reconciliation what America needs today is a leader with the courage to help the economy by government intervention if necessary. A leader in the mould of Franklin Delano Roosevelt. He was never a consensus candidate, but he more than any other leader made America great.

America today faces huge problems. The war on terror is only a sideshow to a greater struggle to protect American jobs, American people, American institutions -- and indeed the world as we have known it -- from emerging forces which no matter how benign -- and that's open to question -- could change the world irrevocably.

Of course, America has unleashed terrible destruction too, in Vietnam, in Iraq.

But America also stands for democracy, freedom of expression, freedom of choice, indeed the American Dream. Look at Bill Clinton,Edwards,Obama. They all rose from modest backgrounds unlike so many other leaders around the world. See how Obama's supporters include blacks and whites alike.Think of the American culture of giving -- to their favourite causes, their alma maters, the scholarships and charities they have endowed. The world's greatest donors, richest colleges are American. America is a great country. Or it would not have drawn immigrants from around the world. Immigrants who have assimilated and are proud to call themselves Americans.

That is why America is worth saving from the problems besieging it. Hillary Clinton is a Democrat prepared to use government intervention if necessary to help the economy and the middle class. She said as much before she had her tiff with Obama at their latest debate. Edwards' populism leaves no doubt about where he stands with the people. Obama, of course, is loved by the people. They would all make great presidents. Any two of them could make up a dream ticket. On the Republican side, of course, McCain has been a heroic figure for a long time. One remembers the excitement he caused on his first Straight Talk Express campaign.

   

What a US recession means for Singapore

The Economist as usual has figures to show how Singapore could be hit by a US recession. It says:

Some Asian economies are more vulnerable than others: Singapore, Hong Kong and Malaysia have exports to America equivalent to 20 percent  or more of their GDPs, compared with only 8 percent in China and 2 percent in India. There are already some ominous signs. Singapore’s exports to America are down by 11 percent over the past year, while Malaysia’s fell by 16 percent. Exports to other emerging economies and to the European Union surged, so total exports still grew by 6 percent in both economies. But that was much slower than at the start of the year, and the worry now is that demand from Europe has started to flag.

But it says there is

"reason to be optimistic that domestic demand (consumer spending and investment) is likely to remain strong and governments have more flexibility... Take Malaysia: exports to America plunged, yet its GDP growth quickened from 5.7 percent at the end of 2006 to 6.7 percent in the third quarter of last year."

Singapore has a tradition of spending on infrastructure to help the economy through hard times. But consumer spending will have to go up, too, to offset any drop in exports. Spending more will not be easy for everyone. A Reuters story last November noted:

Two years of blistering economic growth and a government policy of attracting wealthy expatriates have created a new class of super-rich, while a string of price increases for everything from bread to bus fares have made life harder for the poor...

The proportion of Singapore residents earning less than S$1,000 ($690) a month rose to 18 percent last year, from 16 percent in 2002, central bank data released late last month show.

At the same time, the proportion of those earning S$8,000 and above rose from 4.7 percent to 6 percent in the same period...

Despite sporting a first-world GDP per capita of $29,000 -- second only to Japan in Asia -- Singapore has an income inequality profile more in line with third-world countries.

Singapore's Gini coefficient, a measure of income inequality, has worsened from 42.5 in 1998 to 47.2 in 2006, and is now in league with the Philippines (46.1) and Guatemala (48.3), and worse than China (44.7), data from Singapore's Household Survey and the World Bank show.

Other wealthy Asian nations such as Japan, Korea and Taiwan have more European-style Ginis of 24.9, 31.6 and 32.6.

Technorati Tags: gini coefficient,income

Singapore looks to India and China

Singapore will have to depend on India and China if the US is hit by a recession, says Singapore's Minister Mentor Lee Kuan Yew. But that's a fact downplayed by Singapore's main newspaper, The Straits Times. Why? Usually it highlights anything he says. But this time it has been very selective.

Here is what Lee Kuan Yew said, according to Channel News Asia:

"I do not believe the Chinese economy is immune to a US slowdown, nor is the Indian economy. But I believe they are now much less... influenced by US recession because they’ve got enough going in their own internal economy. They can increase investments in infrastructure; they can increase consumption; they can increase all their projects and keep the economy buoyant," he said.

Wrapping up his five-day visit to Saudi Arabia, Mr Lee said if China can maintain economic growth at around eight to nine per cent a year, then it could weather the economic storm well.

How well Singapore does, he said, will depend on how other economies fare, though he feels Singapore should be able to ride on the healthy performance of China and India.

Now look at what The Straits Times reported: 

He said while the Chinese and Indian economies were not immune to a US slowdown, he believed they were much less influenced by a US recession because they have got enough going in their internal economies.
"They can increase investments in infrastructure, they can increase consumption, they can increase all their projects and keep the economy buoyant. And,if they can keep their economy up, say,instead of making 11, 12 percent, they make 8,9 percent, then we will not go down so much. But that may take one, two years before we see the results."

That was all it said: If the Chinese and Indian economies remain strong, "then we will not go down so much".

Channel NewsAsia was far more explicit. It underlined how much depends on China and India. This is how it started the story:

Singapore’s Minister Mentor Lee Kuan Yew said he is not certain what impact a possible US recession will have on Singapore.

Although it is not clear whether financial markets will take up to two years to recover from the ordeal, Mr Lee said he feels that China and India may provide some cushion for the slowdown in the US.

And then it added: "he feels Singapore should be able to ride on the healthy performance of China and India".

The Straits Times instead led with his son, Prime Minister Lee Kuan Yew's optimistic assessment that Singapore should be able to weather the storm. That's fine.

But it should not have downplayed what Lee Kuan Yew said. It glossed over Singapore's relationship with not only India and China but with the global economy as a whole.

Lee Kuan Yew said:

"Our total trade is 300 per cent of our GDP (gross domestic product). So when the external trade goes down, you tell me how we buffer ourselves. But the external trade may not go down so dramatically because of India and China." (Channel NewsAsia)

That's not mentioned in The Straits Times.

If you read The Straits Times, check other newspapers and websites as well to get the full story.

"Not factually accurate"

I missed the Democrats' debate yesterday, but it looks like Obama was guilty of a pleonasm. He said:

"There was a set of assertions made by Senator Clinton as well as her husband that are not factually accurate."

Pray, sir, is there any other kind of "accurate"?

Or does my question reveal my own ignorance? We have read and heard about something called the "higher truth". So is it possible that Obama was disputing only the factual accuracy of the Clintons' comments and not denying they might be accurate on some other level? After all, he is a lawyer and lawyers choose their words carefully.

Giving him the benefit of the doubt, I looked up Wikipedia -- and, by Jove, Oscar Wilde was right, truth is anything but simple. Truth can be subjective, relative, objective, absolute. That begs the question, if there are so many notions of truth, is it possible at all to tell a lie? Not that I am going to lose any sleep over that question. As a Hindu, I am only too familiar with the idea that the world is an illusion -- maya -- but I am not ready to kick the bucket; let me live my lie.

Remember the words of Shakespeare:

... We are such stuff
As dreams are made on, and our little life
Is rounded with a sleep.

I was reminded of my college days when we had to tackle Plato and Aristotle and the theory of mimesis.

According to Plato, apparently this computer I am writing on is the computer manufacturer's idea of a computer, and therefore only an imitation of the real thing, which exists only in nature, and that is God's idea of a computer. And when I try to describe my computer, I am presenting only an imitation of an imitation.

Truth is the concern of philosophers only, according to Plato, and not of poets, actors or orators.

Maybe that's why Obama complained only of "factual" inaccuracy. He doesn't expect the Clintons to be philosophers.

 

Technorati Tags: obama,clinton,truth

Sex and children: Two poems

One of these is a famous poem by one of the finest 20th century English poets, the other written by a contemporary American poet. Here are the opening lines from both poems. Guess which one is English, which one American. One is witty, the other... well, I hope you enjoy it as much as I did.

They fuck you up, your mum and dad.
They may not mean to, but they do.
They fill you with the faults they had
And add some extra, just for you.

 

We try to be discreet standing in the dark
hallway by the front door. He gets his hands
up inside the front of my shirt and I put mine
down inside the back of his jeans. We are crazy
for skin, each other's skin, warm silky skin.
Our tongues are in each other's mouths,
where they belong, home at last. At first

Hillary, Obama and Mac

Hillary (AP photo) wins again! This time in Nevada! But Obama gets one more delegate than Hillary. Whoever wins the nomination will be a great candidate, but I know where my heart lies. Read Maya Angelou's poem on Hillary in the Observer:

You may write me down in history
With your bitter, twisted lies,
You may tread me in the very dirt
But still, like dust, I'll rise.

Maya Angelou has adapted her poem, Still I Rise, to praise Hillary. The poet can be seen reading the original poem on YouTube.

If Bill Clinton was the Comeback Kid, Hillary is his elegant phoenix. I admire Obama.  He will be an even more historic candidate -- and president if he wins the election. He  has brought excitement to the race, trying to unite Americans and promising change. But I am an old Bill Clinton fan. So I could understand when Maya Angelou said:

"I made up my mind 15 years ago that if she ever ran for office I'd be on her wagon. My only difficulty with Senator Obama is that I believe in going out with who I went in with."

She has a special association with the Clintons. As the Observer said:

The 79-year-old poet was the centrepiece of Bill Clinton's inauguration in 1993 when she read her poem On the Pulse of Morning, playing on the idea of a new political dawn.

I wish the Democrats didn't have to choose between Hillary and Obama. But it was inevitable. Hillary will be 61 this October. And Obama, who will be 47 in August -- one year older than Bill Clinton and four years older than John Kennedy when they entered office -- wants to run while he is fresh and not shopsoiled by too many years in the Senate. He knows his relative youth and freshness are part of his attraction.

The irony is that for all the talk about Hillary's "well-oiled machine", it is she who appeals more to women and lower-income workers -- the core Democratic supporters.

The media, in love with Obama, says he appeals more to the young and the independents and it is the independent vote that will decide the election.

But what if the Republicans nominate Senator John McCain? He has just won in South Carolina and appeals to the independents too. It will be quite a matchup if he faces off against Obama: the old proven war hero against the untried, youthful charismatic leader calling for change and national reconciliation. 

Technorati Tags: hillary clinton,obama,john mccain

Ministers worth more than search engines

I am glad to see Singapore still prizes human intelligence more than artificial intelligence. Singapore's Agency for Science,Technology and Research (A*STAR) is offering $100,000 to the winner of a contest to build the next-generation search engine. That's a fraction of the annual salary of Singapore ministers whose pay will range from nearly two million to more than three million Singapore dollars this year. (Two million Singapore dollars is about $1.39 million.)

I see nothing wrong with that. We can all create our own little search engines for free using Google Custom Search. But there is only one Lee Kuan Yew.

Still, for building the next-generation search engine, the prize money is inadequate, says search expert John Battelle. "Sorry, Singapore, that's not enough scratch... that's not gonna get it done," he comments on his blog. 

A*STAR says it wants developers to create:

a rich media search engine that will be smart enough to identify text, audio and video containing any word, even if that word, or search term, has not yet been tagged in the internet material.  Millions of search engine users around the world stand to gain from such technologies that will help them navigate the rich material that is now on the Internet with the current Web 2.0 phenomenon and the proliferation of user-generated new media platforms such as YouTube, Facebook and Flickr.

Quite a mouthful, eh?

Contestants have to register by February 29 and the top five teams will be flown to Singapore for the finals in October.The winner will be decided by an international advisory panel which includes professors from Berkeley, Columbia, University of Washington and the National University of Singapore.

The contestants will have the satisfaction of competing with Google. A*Star's quest is similar to Google's own "vision for universal search", said Google, which revealed plans to create such a search engine in May last year, reported ZDNet.

Technorati Tags: search engine,singapore,A*STAR