Tuesday, July 26, 2005

Bush's Bold Move

Indian Diplomatic Initiative Pays Dividends
Shaping the New Century

Partnership for prosperity
From The Staesman
ND BATRA

By offering India “full civilian nuclear cooperation nuclear energy,” President Bush has made a bold move in establishing long term strategic and economic relations with a country that many US experts perceive as a reliable global partner.

Mr Bush did not let the nuclear Non-proliferation Treaty stand in the way of his new global vision, where an economically strong democratic India would play a stabilising role in world affairs, especially in Asia. The partnership to help India “become a major power in the 21st century” is not about containing any other rising power but to let India develop as an alternative model of economic growth without compromising fundamental freedoms.

Rapid economic growth of India, 8-9 per cent a year for the next few decades, would lift millions of Indians out of abject poverty.

Besides, an economically dynamic India would make the military containment of China by the USA unnecessary. More equal players in the Asian drama, less the possibility of a single hegemonic power rising. Mr Bush did not welcome India to the nuclear club; nor was that India’s diplomatic goal. He just removed hurdles in India’s search for alternative energy sources to fuel its growing economy.

In the process, however, Mr Bush did acknowledge India “as a responsible state with advanced nuclear technology”, recognising it as an exception to the rule, and accepted the fact that India should “acquire the same benefits and advantages as other such states.”

When Congress approves the deal, India would be able to buy nuclear fuel for its existing nuclear power plants and shop for building new ones, but in the course of time as trust in partnership increases and diplomatic relations improve further, a whole new world of sophisticated American technology would be open to India, enabling it to leapfrog decades of past sluggish economic growth.

In return India has agreed to do what other nuclear powers have been doing under the nonproliferation treaty, that is, open its civilian nuclear power plants to the International Atomic Energy Agency and continue the moratorium on nuclear testing. Its nuclear military arsenal remains off limit.

Critics in India who fear that the deal would create co-dependency relations with the USA need to consider how South Korea, Taiwan, Japan and China have benefited from strong economic partnership with the USA without compromising their sovereignty.

India must go beyond information technology outsourcing and penetrate deeply into corporate America. Had Mr Bush decided to back India’s claim to UN Security Council permanent membership - instead of lifting nuclear sanctions — he might have flattered the ego of the Indian elite, but that would not have helped India solve its energy and infrastructural problems.

The Iran-Pakistan-India pipeline is certainly in the realm of possibility but even if it materialises, it may not be enough to meet India’s gargantuan need for energy. Clean coal technology, nuclear energy and solar energy are practical alternatives for which the USA has opened its doors to India.

India needs hundreds of billions of dollars of foreign direct investment in building power plants and world-class infrastructure to increase its manufacturing base to create employment opportunities. Nuclear energy would reduce excessive dependency upon oil from West Asia.

Eventually the USA would support India for a UN Security Council seat too. The greatest applause Prime Minister Singh received during his address to the joint session of US Congress occurred when he reminded them “that the voice of the world’s largest democracy surely cannot be left unheard on the Security Council when the United Nations is being restructured.”

It is only a matter of time when India, with one-sixth of the world population, would be offered its rightful place in the Security Council. Partnership was also one of the themes of Dr Singh’s marvellous address to the joint US Congress session on Tuesday. In his impeccable Indo-British accent, Dr Singh told his appreciative audience that India and the USA are natural partners because both are open societies and share similar values. “There are partnerships based on principle, and partnership based on pragmatism. I believe we are at a juncture where we can embark on partnership that we can draw both on principle as well as pragmatism.”

Democracy, multiethnic diversity, and human rights are some of the values that bring the two countries together, but equally important is the fact that India and the USA need each other to fight global terrorism. Mr Bush’s relentless and determined campaign against militant Islamic and Al-Qaida terrorism has begun to change the mindset in Pakistan where there is a growing feeling that negotiations are the only way to resolve long-standing issues. Mr Bush’s policies have helped India fight its own terrorism.

For the next decade or so, India’s diplomacy should have a laser-like focus on one primary goal: speedy economic growth. Would the partnership with the USA help India hasten the pace of economic growth? Yes, of course; therefore, in India’s national interest, this partnership is justified.

It is by far the greatest achievement of the Singh administration, and its diplomatic corps deserves applause for its hard work, bold initiative and creative imagination.

Tuesday, July 19, 2005

USING LEAKS AS POLITICAL TOOLS

Revenge politics and Press freedom

ND BATRA
From The Statesman

In 2003 CIA asked diplomat Joseph Wilson to investigate whether Saddam Hussein procured uranium (yellow cakes) from Niger. Wilson found no evidence and was publicly critical of the Bush administration for making such a claim.

Immediately after Wilson’s critical report, conservative columnist Robert Novak wrote that “two senior administration officials” told him that Wilson’s wife, Valerie Plame, was a CIA secret agent working on weapons of mass destruction issues. The information was leaked to him to discredit Ambassador Wilson and to compromise his wife’s career.

The true culprit in this diabolical case is the columnist Novak, who violated the law. The Intelligence Identities Protection Act, enacted in 1982 to protect undercover CIA agents, makes it a crime to intentionally identify a covert agent.

Judith Miller, The New York Times reporter, who never published her story but might have talked with some White House officials about the leak, was subpoenaed to reveal whom she talked to. But she refused. While Miller has chosen to go to jail to protect her First Amendment freedom to gather news, another journalist, Time magazine’s Matthew Cooper, privy to the leak, has agreed to testify before the grand jury but only after **Time** handed over the source of the leak to investigators.

Recently, The New York Times wrote that it was “a proud and awful moment” for the newspaper because of one of its reporters, Judith Miller, “has decided to accept a jail sentence rather than testify before a grand jury about one of her confidential sources.”

In the USA, authorities give journalists hell by using subpoena power. Journalists cultivate confidential sources to uncover corruption; and sometimes they know more about a case than crime investigators. Jim Taricani, a Rhode Island television reporter, was put under house arrest for four months for his refusal to disclose the source of the videotape showing a state official taking bribes from an undercover law enforcement informant. Whistle-blowers leak documents or talk on the promise of confidentiality to reporters. Reporters must report if they have information that impacts society. Not to report truth would be not only complicity in crime but also an unethical and unprofessional behaviour.

Sometimes courts, and even legislatures, issue subpoenas demanding information including notes, photos and videos that have not even been published, failing which they exercise contempt power. Contempt power tends to chill freedom of the Press. Why? Because journalists would dread going behind public relations handouts to find out the truth about the misbehaviour of public men.

State shield laws that are supposed to protect journalists from unnecessary disclosures are not always helpful. “In opinion after opinion,” says the Reporters Committee for Freedom of the Press, Agents of Discovery, report, “judges fail to acknowledge any special role for the media in a democratic society, or any public interest in ensuring that the media remain impartial and disinterested both in perception and reality.”

American society, for more than four decades, has been struggling with how to strike a balance between the news media’s obligation to do investigative reporting by cultivating confidential sources and the needs of the courts and law enforcement for access to crucial information that journalists might possess.

When a journalist is the only source of information that constitutes a crucial piece of evidence in a legal case, information so compelling that without revealing its source there is a danger of justice being miscarried, in such a circumstance the source must be revealed regardless of the promise of confidentiality. The right to a fair trial is no less important than freedom of the Press. But how do you draw strike the balance?

With time, the US Supreme Court began to use a “preferred position balance theory” in deciding conflicts between freedom of the Press and other rights.

In numerous rulings, the court held that some freedoms, especially those granted by the First Amendment (freedom of speech and the Press), are fundamental to a free society and consequently deserving of more protection than other constitutional values. Nonetheless, freedom of the Press does not trump all other rights, especially the constitutionally guaranteed right of a person to a fair trial that may require access to crucial evidence in the possession of a journalist. Thus by giving freedom of the Press a preferred position in balance with other rights, the government bears the burden of proof that forcing a journalist to disclose his news source is absolutely necessary.

Bob Woodward and Carl Bernstein of The Washington Post depended upon a confidential source, Deep Throat, for their path breaking investigative reporting about Watergate that brought President Nixon down. Mark Felt, who revealed himself recently as Deep Throat, could not alone have brought down Richard Nixon. Leaks from the office of independent investigator Kenneth Starr enabled reporters to uncover the Clinton-Lewinsky affair. Corporate whistle-blowers disclose corrupt accounting practices, faulty products and other malfeasances to journalists so that society might benefit.

But what happens if a confidential source is revealed? It damages the reporter-source relationship and threatens the news organisation’s image of independence. When sources suspect a collusion between law enforcement and news organisations, trust is lost. Free flow of accurate and reliable information is choked; and power begins to corrupt.

An independent judiciary and a responsible free Press are the watchdogs of an open, secular, democratic society; and they must be kept apart. Reporters must not become tools of vindictive officials or political operatives, as columnist Novak chose to become by revealing Valerie Plame’s name.

Now that we know the truth that a source of leak was the White House deputy chief of staff Karl Rove, a trusted confidante of President Bush, let the law take its course and the guilty be punished.

Tuesday, July 12, 2005

Food Chauvinism


Fascism of food
N.D. Batra
From The Statesman

The French were crestfallen after Paris lost to London in the 2012 Summer Olympics bid and more so because a day earlier French President Jacques Chirac had said about Britain that it’s difficult to trust people who eat such “bad food” and whose only contribution to European agricultural was mad cow disease.

The unsavoury remarks from someone whom the British media called “a man full of bile” might have affected the Olympics committee in its final choice. But there is no gainsaying the fact that the French do feel immensely proud of their food and wines, which are among the best in the world. About food one cannot be politically correct for too long. Britain is not known for great cuisine. Nor is the United States of America, except for its abundance.

A few years ago, I met Second Lieutenant Jerome Bibeyran, a handsome young man from Ecole Speciale Militaire de Saint-Cyr, who was visiting Norwich University under an exchange program. I never fully appreciated what the Scottish poet Robert Burns said, “Oh wad some power the giftie gie us/To see oursel’s as others see us!” I was to work with SLT. Bibeyran on his thesis on “crisis communication” with special reference to how Monsanto, the agribusiness giant, was dealing with the furore over genetically modified (GM) food. I had written an occasional column about GM food, butterflies and Prince Charles, but never understood the depth of hostility against the technology, especially in Europe.

In the course of time, I began to wonder how the French look at the American society. With SLT. Bibeyran’s consent, I decided to assume the dual role of a mentor and journalist, as we went along probing the topic of crisis communication. SLT. Bibeyran had come up with very probing questions regarding how Monsanto seemed to be handling the public relations crisis.

The preliminary research he had done gave him some idea about the nature of the communication problem. Monsanto had concentrated on the American farmer and did a very good job but ignored the consumer, especially in Europe where many people began to associate the British mad cow disease with GM, calling it Frankenstein food.

The growth and distribution of GM food is heavily regulated in France. Labeling is a requirement, something to which American GM food companies are totally opposed. There are no doubt big agri-businesses in France too and only one per cent of the working population is engaged in farming, but it is possible to have farm fresh produce.

Jerome talked about the weekend farmers market in his hometown Bordeaux, southwest France, where people buy fresh produce as they do in Vermont in the summer, or in India throughout the year. I asked him what the French thought about American food. In December 1999, he said, a lone French farmer demonstrated in front of McDonald’s protesting that he was fed up with American “mal-bouffe,” but the media gave the one-man protest so much publicity that overnight he became a national protest symbol. Nevertheless, he hastened to add, young people, especially in the 13-18 age group, do like to eat American fast food especially when they go to the movies.

I drew his attention to a New York Times article on GM food. It quoted Pierre Lellouche, a Gaullist member of the French Parliament committee on environmental safety, who said, “The general sense here is that Americans eat garbage food, that they’re fat and they don’t know how to eat properly.” Jerome hesitated for a moment and then replied with utmost frankness: “Yes, American food is full of fat. Vegetables are not properly cooked. They taste like plastic. Everything has the same flavour.” I was not expecting this reaction but liked his honesty.

The French palate may be difficult to please, but many Indians visiting home have expressed similar prejudice: food tastes better in India, they say. In my younger days when I taught at St. Xavier’s College (Ahmedabad), we had a group of five exchange students from Harvard University. I gave some of them a crash course in Hindi and one night at a dinner I asked the group what they thought of Indian food. One of them said, “Spicy food has killed your taste buds. You don’t know what the real food tastes like.” I almost choked on the morsel. American vegetables taste like plastic and Indians’ taste buds are dead! Food generates such strong feelings in people!

But to get back to Jerome. What do the French in general think about the USA, I asked, trying to get out of the soup. Everybody in France has an American dream, he said. People envied him when they came to know that he was going to visit the USA. The French, he said, are fascinated with American technology, with America in general because everything is bigger here.

But soon the critic surfaced again and SLT Bibeyran let me have it straight: “Americans are the biggest wastrels in the world. The have lost a real sense of life. They don’t enjoy simple things, which are close to nature. They are messing up food, from the farm to the dinner plate.” President Chirac might have been too provocative in his remarks about Brits and their cuisine but he is certainly not alone how the French feel about others’ taste buds.

Tuesday, July 5, 2005

CREATIVITY AND DIVERSITY

Diversity matters
From The Statesman
ND BATRA

This is an age of smart ideas. Ideas are potential assets.
Creativity matters and sets a nation apart. There’s a new frenzy for reaching customers through newer modes of communications, including product placement in television programmes.

The busiest shopping season in the USA has always been Thanksgiving through Christmas, but for businesses it is too risky to depend solely upon the holiday season for profitability, market share or even survival. Which has led advertising and marketing agencies to find creative ways of persuading buyers to open their wallets. A decline of even 1 per cent in holiday sales ripples through every trailer park and leaves many people shivering in the cold. So shoppers are being offered unprecedented discounts on sales of all kinds of goods from cars to carpets to offset a bad holiday season, if it were to occur.

Even the pharmaceutical industry, especially the prescription drug industry, has entered into the game of direct marketing. Any idea that brings the shopper to the mall and seduces her to fill up the shopping cart is an invaluable asset. The USA desperately seeks ideas that can make things happen, whether it is to catch Al-Qaida operatives; or to persuade the shopper to take out the credit card and spend whether she has the money or not in the bank.

But how do you turn an idea into an innovation and bring it to the marketplace? “I am your idea”, said an Accenture blurb sometime ago.“One day you’ll look for me and I’ll be gone.” Ideas are ephemeral unless you grab them and make them do something. Make ideas work by sharing with people who know how to turn them into innovations and tangible goods.

Occasionally in social gatherings, someone would buttonhole me and say: India has some of the world’s brightest economists, why can’t their ideas be turned into something that would speed up economic growth in India? At such moments I nod in wonderment.

India is full of bright minds, indeed! And they would be returning to India especially with the introduction of dual citizenship, a brilliant idea that would generate unprecedented opportunities for investment in India. Besides, every time there is some discussion about India’s economic growth, naturally China’s sustained economic growth of 8-10 per cent during the last two decades comes up for comparison. Two decades ago both the countries were struggling at the same level of poverty.

But one day the Chinese paramount leader Deng Xiaoping had a revelation: Capitalism is good, he mumbled after returning from a visit to the USA. Make money, not revolution. And the floodgates of entrepreneurial spirit opened up in China, even without political freedom.

Keith Bradsher of The New York Times wrote sometime ago that China, “by quickly converting much of its economy to an unfettered and even rapacious version of capitalism, has surged far ahead…. China has high-speed freeways, modern airports and highly efficient ports that are helping it dominate a growing number of manufacturing industries.”

In a matter of years, China has become a manufacturing hub of the world, sucking most foreign direct investments. It looks like all ships are sailing to and fro from China. China’s miracle is not based on any grandiose economic theory, but on a few simple ideas: Excellent law and order conditions; good transportation and communications facilities; and the courage to let the people make money. But this column is about ideas, how to take them from one field and make them work in another, for example, from the battlefield to the marketplace. Americans are good at this; for example, American advertisers are using Jean Piaget’s theory of child development, sensory experiences and visual stimulation to sell EZ Squirt Ketchup to grownups. Said Alissa Quart in Wired, “Piaget is only the beginning. Just as the pharmaceutical industry steers medical research, marketing and advertising are beginning to guide the way scholars investigate brain functions, perception, and language.”

Consider, for example, cognitive science, a multidisciplinary area that includes psychology, neuroscience, sociology, and computer science. At the highest level, it is associated with the study of artificial intelligence and autonomous systems, but at the market level its ideas are being increasingly used to study “the psychology of acquisition and the science of material desire”, for better marketing and placement of products, anything from toys and cereals to jeans. What’s wrong with that? Ask some professors who make a lot of money in consultations. Many of us do have qualms about turning the academia into a handmaid of the marketplace but in the USA various fields of intellectual endeavour are not sealed shut from each other. Ideas flow from one field to another and flourish wherever they find the best applications, whether it is the shopping cart or fighting terrorism.

It is all about the psychology of desire that transforms an idea into an asset; turns driving a car into love and adventure; turns zeros and ones into an outsourcing industry. In the ultimate analysis, it is all about creativity, the third pillar of New Economics, the perpetual cycle of growth; the other two being venture capitalism that dares to turn the untried into wealth; and infrastructure that includes security and the rule of law.

Tuesday, June 28, 2005

DIGITAL SPIES, NOWHERE TO HIDE

cyber age: ND Batra
From The Statesman
Digital spies, nowhere to hide

From time to time many US Senators say how deeply concerned they are the way the USA is gradually slipping into a low-intensity surveillance society. Since the terrorist attacks four year ago, there’s a diffused sense of insecurity, which flares up occasionally. The Americans are quietly submitting to whatever brings them a feeling of assuredness. While they protest against intrusiveness by the government, businesses dig into their personal lives with near impunity. Protests remain muted.

Senator Shelby told a congressional privacy caucus a few years ago, “It would appear that while you use the Internet, the Internet is using you. You can get more information of a computer (about an individual) than a wiretap. What concerns me is the national implications to this.” The Senator was referring to web bugs and other online surveillance devices that are being increasingly used by businesses to track users when they surf their websites. Tracking is done unobtrusively and the user can never suspect that he is being watched; nonetheless, the practice is questionable, especially when the Website does not declare it in its privacy policy.

Most of us are familiar with cookies, small software programmes the advertisers put on our hard drives to track where we surf so that they can customise the most appropriate advertising message for us to achieve target marketing, reaching the right person with the right message. But web bugs are different. These tracking technology devices can be programmed to collect whatever data is required without the user’s knowledge. For example, a web bug can be programmed to look at a data file on a networked desktop without leaving a trace that data has been touched at all.

When you look at your online mutual fund statement, the web bug too could be monitoring it. A few companies do inform their visitors about the tracking devices they use and for what purposes. Some companies use web beacon, a single-pixel picture, to count and identify users. A web beacon can track whether a particular message, including junk mail, has been opened and acted upon or not. Any electronic image that is part of a web page, including a banner ad, can be programmed to act as a beacon and spy on the user. Web portals/search companies claim that the information enables them to personalise the surfing experience when a frequent user visits their sites. Some use beacons to do demographic research on behalf of their clients, but assert that no personally identifiable information gathered from the beacon research is shared with the clients.

Users can opt-out, but most of them don’t know whether the option is available, nor do many of them pay attention to the privacy statement. Surveillance technologies are not limited to the Net. Several companies are using biometrics, face recognition, radio frequency and global positioning system (GPS) technologies, to keep a watch on their properties and track suspects.

Many car rental companies in the USA use GPS to keep track of their rental cars. If a car is stolen or is involved in an accident, the company would know the exact location of the car. GPS also enables them to check the speed of a rental car.

In July 2001, for example, Acme Rent-a-Car of New Haven, Connecticut charged one of its renters $400 for exceeding the speed limit, which it tracked with GPS; but the Connecticut department of consumer protection sided with the renter and did not allow Acme to collect the fine.

It also raised an intriguing legal question whether a private car company can act as traffic police and penalise the offender.

Many airports have been using digital fingerprint identification technology from Visionics Corporation to conduct background checks without any protest from employees.

Face recognition technology is being extensively used not only in airports but also in ballparks, banks and other business establishments.

If a suspect turns up, his face is digitally matched in seconds with the image database. It is not a foolproof system; for example, a man with sunglasses could not be identified with face recognition technology. So far no terrorist has been apprehended by face recognition technology, but the security business is booming the USA. The US Customs and some airports are using low-dose x-ray machines, such as Body Search, to electronically scan a person for drugs, bombs and contrabands. Body Search electronically strips a person naked and projects the image on the screen for scrutiny without the person being asked to take her clothes off – all in the name of security.

Hundreds of air travellers, including women, are randomly subjected to electronic Body Search.An interesting security tracking technology is the radio-frequency identification tag (RFID), which is attached to a suspect’s baggage as he checks in. The tagged baggage is automatically routed to a security area where it is screened with special cameras and sensors for explosives and other hazardous materials.

What’s our digital future? Along with our baggage, we too might have to wear radio-frequency ID tags so that we can be monitored as we move from one airport to another, from country to country via GPS. It may not increase security, but it surely is going to be multi-billion dollar business, thanks to the perpetuation of fear created by Al-Qaida. How ironic that terrorism creates business opportunities for some.

Tuesday, June 21, 2005

All that's news but no ethics

cyber age: ND Batra
From The Statesman

Ethical cleansing: All that’s news

This is the Internet age. News spreads instantly. To set the world on fire, you don’t need six degrees of separation. In May, Newsweek’s report about the Koran being desecrated was based on an anonymous government source, which turned out to be false and caused massive streets protests in Pakistan and Afghanistan, where 15 innocent people were killed.

Newsweek’s apology and retraction has not helped the credibility crisis of news media. Newsweek saw something scoop-worthy and succumbed to the temptation of reporting it. That’s what tabloids do. Of course, since the uncovering of Abu Gharib prison abuses, there has been widespread suspicion that similar abuses might have been taking place in the Guantanamo Bay prison facility also.

This is a variation on profiling mentality, that is, you have a mental picture of something and you go on imposing it on similar looking situations. But that is not journalism. Sometimes the US news media is too deferential to the White House and faithfully reports what it is told; but at other times, it behaves as if whatever the government says must be false. The attitude of healthy scepticism, trust but verify, which distinguished US news media before 9/11, has not altogether vanished but has certainly become subdued.

Under the pressure of the 24/7 instant media flow, news organisations sometimes too hastily give up their gatekeeping functions and betray our trust, in spite of their good intentions. It is not only about the Bush administration’s pre-war propaganda about the weapons of mass destruction, which most American news media lapped up without much questioning, and later on began to discover to their dismay how wrong they were.

Some of them, for example, The New York Times and The Washington Post, have indulged in the luxury of critical self-examination, and published lengthy analysis why they ceased to think independently and swallowed the official line about weapons of mass destruction.

The American media mindset, excessively partisan or deferential, can be dangerous to the world. The behaviour of American media, especially after 9/11, shows that freedom of the Press does not necessarily lead to independent and objective reporting and analysis. American news media, especially wire services such as the Associated Press, dominate worldwide news gathering and dissemination.

They are the eyes and ears of the world in the sense that we see the world as much as they want us to see it and the way they want us to see it. This might sound like a conspiracy theory, but should we always trust news media? It is not so much their biases and prejudices in the selection and exclusion of stories; it is the matter of reporting facts that could be verified.

Because the world depends upon them about what is happening, they have an ethical responsibility to go behind the story and uncover the truth before they publish what they garner at the first attempt. Of course, sometimes it is a major dilemma for news media how to deal with events that are happening at a warp speed; nonetheless, disclaimers and caveats, or subsequent apologies and retractions, do not go far enough in explaining what is real and what is fabrication.

In an environment of distrust and fear, people would accept anything, even if it were a hoax. On the eve of Halloween on 30 October1938, when war drums were getting louder in Europe, the famed Hollywood actor Orsen Welles created widespread panic in Grover Mills, a small town in New Jersey, by broadcasting the hoax that Martians (based on HG Wells’ War of the Worlds) had landed in the town. Some people rushed to their churches believing that the end of the world had come while others got ready to fight the Martians.

Radio was the major news source in those days and people accepted as truth whatever they heard on radio. Welles wanted to debunk that blind faith with his radio hoax but instead aroused the wrath of the people and Congress.

The Federal Communication Commission would impose a criminal penalty on any station broadcasting a hoax today. While the Welles radio hoax fooled only the ordinary folks of New Jersey and no serious material harm was done, but it does show what rumours and hoaxes posturing as news could do.

Newsweek’s unverified story not only killed innocent people but also further spoiled the already tarnished image of the USA in the Muslim and Arab world.

Max Boot, a senior fellow at the Council on Foreign Relations, wrote in the Los Angeles Times that “perpetrators were prisoners, not guards…. the most serious desecrations of the Koran at the Guantanamo Bay detention facility were committed by the Muslim inmates themselves. Some of the most inflammatory allegations, such as guards flushing a Koran, appear to be the result of unsubstantiated rumours spread by inmates who may have been following Al Qaida instructions to falsely claim mistreatment. Or maybe they were simply trying to deflect blame for all the Korans they were mutilating.”

Regardless of the Pentagon’s conclusion based on Brigadier- General Jay Hood’s internal investigation that no desecration occurred, and Newsweek’s retraction and apology, it is going to be difficult to undo the damage to public diplomacy. The Afghanistan Islamic clergy once again has demanded, “Whoever is responsible for these crimes should be handed over to an Islamic country to face trial.”

Tuesday, June 14, 2005

India's Economic Growth as a "Virtuous Cycle"

India readying plan for China-like grip on US


India and knowledge economy

From The Statesman
ND Batra

Recently, Indian Prime Minister Manmohan Singh announced the establishment of a National Knowledge Commission, “on matters relating to institutions of knowledge production, knowledge use and knowledge dissemination”. Which is recognition of the fact that India like the USA and other developed countries is moving toward an information technology and knowledge-based economy.

According to the World Development Report 1999-2000, most advanced economies today are “truly knowledge-based”, in which “the balance between knowledge and resources has shifted so far towards the former that knowledge has become perhaps the most important factor determining the standard of living — more than land, tools and labour”. Today’s technologically advanced economy is a triangulation of knowledge, labour and capital. But the driving force is knowledge produced by information technology, innovations which make labour and capital more efficient, the kind of knowledge that is being generated in India’s technology parks in places like Bangalore, Hyderabad, Kolkata, Mumbai, Pune, Gurgaon and so on.

A handful of technology-based knowledge producing cities could lift the whole country through surging ripple effects. Technology-based knowledge, unlike capital and labour, is inexhaustible and is “non-rivalrous”, as economists say. Sharing knowledge does not diminish it, though patent and copyright protections may be essential. But there is a caveat. In a thought-provoking essays, “Beyond Information Revolution”, published in The Atlantic Monthly a few years ago, Peter Drucker said “bribing knowledge workers”, who are leading the Information Revolution, with stock options and other incentives may in the long run prove nonproductive and even disastrous in the 21st century. The dotcom bubble bust gave us much to think about.

Drucker talked about Victorian England, where some of the most important technologies of the Industrial Revolution were developed. Because of the British class system which valued a “gentleman” more than engineers, traders and entrepreneurs, the industrial leadership passed on to the USA and Germany in the 1850s. England raised Cecil Rhodes, Robert Clive, East India Company (a trading rather than a manufacturing venture) and commercial banks but no venture capitalist, like JP Morgan in the USA, a person “who has the means and mentality to finance the unexpected and unproven”. Drucker is right about venture capitalists who are mostly responsible for the information technology growth in the USA, though we should not forget the role of the federal government because initially The National Science Foundation and the Pentagon financed the Internet’s development. No less important than the venture capitalist, it is the idea of the Internet — open standards and communal sharing of software — which has bred the Information Revolution.

Drucker said that at the heart of the Information Revolution is not the computer, which at best is a tool to routinise information processes; nor is it software, which is nothing but “the reorganisation of traditional work, based on centuries of experience, through the application of knowledge and especially of systematic, logical analysis”. It is rather the creation of knowledge, which is fuelling the next wave of the Information Revolution. Paul M Kennedy of Yale speculated in his book The Rise and Fall of the Great Economic Powers (1989) that since the USA had become a global robocop and was spreading its economic resources too thinly, it too would meet the fate of the earlier imperial powers, which had declined by overextending themselves. But look what has actually happened. Instead of economic and political decline, the USA is going through a healthy economic growth period, in spite of the 9/11 terrorist attacks, the 2000 dotcom bust, outsourcing, and recent corporate scandals. The unemployment rate is 5.1 per cent, which is the envy of the world, thanks to technology-based knowledge and venture capitalism. The future economic growth, according to Drucker, would come not so much from the booming stock market and Internet industry; but from those industries where the knowledge worker would be as important as the financier or the capitalist, for example, biotechnology where the gestation period is long and rewards for workers cannot be stock-market driven.

He suggested that since “performance in these new knowledge industries will come to depend upon running the institution so as to attract, hold, and motivate knowledge workers”, we would have to do something else, something symbolic, for example, giving knowledge workers the status of “fellow executives and partners”. In the knowledge factories of the 21st century, there will be hired workers. You may call them principals and partners and give them flexible work hours or freedom to work-wherever-you-go with the wireless laptops. But there would still be the need for command and control and visions of venture capitalists.

While the mandate of the Knowledge Commission is to sharpen India’s “knowledge edge”, and “promote excellence in the education system to meet the knowledge challenges of the 21st Century”, the greater need is to create a system where entrepreneurs and venture capitalists grow and accept the challenge of “the unexpected and unproven”.

The Knowledge Commission should study how the marketplace, apart from the universities and the IITs, could be harnessed to create knowledge that generates innovations that can raise India’s growth permanently in a kind of what economists such as Stanford’s Paul Romer and others call as “a virtuous cycle”.