Have you picked up the August 2009 issue of Pragati yet? It is good. The focus this time is on legal and regulatory reform and it has been guest-edited by Shruti Rajagopalan. My favourites are this piece by Ajay Shah about the changes in legal regime required for further Financial Reform, Aadisht’s article on the widespread prevalence of retail corruption in India, and Jaivir Singh’s article on Labour Laws and Special Economic Zones.
A little more about that last piece. The common wisdom is that we need to reform our labour laws to make life easier for our companies. The theory is that if employers know that they can lay off workers without getting mired in red tape, they will be more willing to hire workers. Now, many people argue that labour inflexibility is not actually much of a burden on employers and that they get around restrictions by hiring contract labour or by “persuading” labour inspectors to be more flexible.
Labour laws do hamper employers when the workers have lots of market power anyway and there are strong unions, as was the case in the Bombay of the 60s and 70s, but when companies set up textile mills in remote areas of Tamil Nadu and Gujarat where employment is scarce and the low wages they offer are still better than the alternatives, they are pretty much useless. In other words, labour laws are ineffective precisely where they could be of use to Labour.
Jaivir Singh points out that instead of changing the law to provide a little more flexibility to employers, opposition to the relaxation has forced government to adopt a subterfuge wherein they are ignored almost entirely within SEZs. Incidentally, Aadisht’s article is also about why India’s preferred mode of corruption is one where industries buy lax enforcement of the law, rather than lobbying to have laws changed.
When I wrote my post “Most blogs are terrible”, I had intended to write a post on how to think of whether blogging will replace journalism. The idea was that we should disaggregate all the functions that current mainstream newspapers perform, and see how the same functions can be performed by the blogging network. That post has now been written, though not by me.
Ajay Shah writes that India may be in for terrible times. He has been writing that the fiscal situation of 1991 may be back. He has also been claiming that India has not yet learnt to manage business cycles.
Edmund Phelps writes about the inherent uncertainty of the capitalist sysem and points out that it is not really a problem with capitalism as such.
I have been remiss in pointing out that George W Bush too has caught on to what I have been pointing out. It is the prosperity of the middle class that causes inflation. If you have a few rich people and lots of poor people, the poor would be free of inflation. It is the middle class in India and China that causes the problem. Ajay Shah explains better.
There was a time when The Maanga used to focus on puking and used to puke very well. Sadly, by mindlessly diversifying its portfolio, it has lost focus. By trying to mix puking with intelligent commentary, it has ended up doing neither.
A puke is like a surgical strike. To be successful, it has to be well-planned. You have to not only injure the target, but devastate it in the first attempt. Once you are done with it, you should be back in safe, well-defended territory. If you fail at these, your battle is apt to go awry. Your alternatives will be to call in reinforcements to defend a weak position or to stage a difficult retreat. Neither choice is pretty.
A case in point is Avataram declaring that Ajay Shah is a moron and then following it up with a search for reasons to back up his point.