Tuesday, August 23, 2011

Views on Corruption

Finally I find something compelling enough for me to go and blog...which is an achievement in itself.


The purpose of this blog is to express my individual opinion on corruption and the present crisis (it is a crisis in my mind) that my country faces.

Understanding the root cause

IMHO, before we get into analyzing anyone's actions (Anna Hazare, Govt or the common man), it is imperative to identify and understand the problem. The question that has been haunting me for the past few days - Is Corruption the cause of the problem? Is it a symptom? Or is it just an outcome of an entirely different problem? I think it is more the later and less the former. Corruption is the outcome of some very core issues that have plagued Indian society and governments for a long long time now. A few of them, I attempt to detail below -

Poor Administration

I have been amongst the lucky few who has spent a substantial time living and working outside India - in the USA. During this time, I have dealt with administration here and experienced good governance (critics may argue the fiscal indiscipline but I don't want to go there). A good example is a process like getting a Driver's License. It is a simple, well laid out three step process out here that even the layman can understand. The form has less than 15 fields to be put in on it. No ID, photographs and photocopies need to be attached. Your ID is validated by the officer in person, a photograph is clicked at the DMV (equivalent of the RTO) and you are asked to take a written test. Score at least 32/40 and you pass. Else you fail. Study the laws and retry. The entire thing (excluding the test preparation) takes under 30 minutes. Because the process is so simplified, objective, well laid out and streamlined, bypassing it or getting past it is not really do-able. America's common man can finish a DL in under 15 minutes if he/she is smart. And yes, you do have to wait 2 hours in the queue here as well before you can get to take the test.

Another example is getting a passport. My son is born here and we got him a US Passport. I submitted his form electronically, took a print out, attached a photograph (you can also get a photograph in the passport office itself for a fee), went to the post office and paid a fee. The passport reached home in 4-5 weeks. Everything was electronic, simplified and simple for the common man to understand.

Another example - this one for businessmen.

My wife is an independent consultant and runs her own LLC. We had to register the company and pay taxes as a corporation. I could find everything out on the website of the respective departments and do the registration myself online. We pay our taxes ourselves because taxation is simple enough to go and do yourself. No complications that let you save/bypass paying taxes unless you are making millions and billions. And the process is simplified enough for a normal person to figure it out.

What am I trying to get at?

If you design processes that are simple enough, you reduce the interactions and loops a common man has to go through to get something done. The moment you do that you reduce the points at which corruption can possibly happen. The problem is the process and the associated complexity. That is what encourages corruption and promotes it.

Lack of Accountability

In India, it is fair to say that administrative accountability is close to zero. When there is no accountability, performance suffers. Two reasons come to the mind -

1. We are a young nation

As a democracy, we are only 64 years old. For a nation, that is a relatively young age. Most mature nations are older. You might argue that some of the better governed nations were never democracies in their early days (France was a constitutional monarchy, germany was a dictatorship and so on). But the fact is that they were all ONE UNITED country ruled by ONE ruler since two or three centuries now.

To put it in other words, we are only being governed as one country since 60 years.
When you are so young, you have a lot to learn. The police chief of Oakland (one of the notorious parts of the large San Francisco area) is fired if crime rate is not kept below a certain factor. There is no such concept in India. Administrators are not accountable for anything. Good roads or bad roads don't matter. And this lack of accountability breeds haughtiness and corruption in the administration. Hopefully, we are on the right track and will learn

2. There are several fundamental issues which sideline poor administration and corruption

Poverty, Literacy, Caste ism are just a few examples. I am not saying that these are the biggest issues today but if we look at India from 1947 - 2011, these were the bigger issues. The common man cared more about rice and wheat than corruption. If you can feed 100000 people, you could get 100000 votes. A poor man who struggles to make ends meet cares more about feeding his family than the crores of Sharad Pawar. A lot of people (myself included) say that voting is the right way. And that is what democracy provides you to effect a change.

The point I am trying to make is - the issues on which India typically votes are beyond corruption. Politicians know this and hence they know they can embezzle millions and get away.

Liberalization and Boom of the private sector
What has this go to do with corruption? To me, it is one of the most important contributors.

The per capita income of India in 1999 was around 360$. Today, it stands at around 1220$. Almost 3.5 times. Most of this has been driven by liberalization and the burgeoning IT sector.

In contrast, the fifth pay commission was set up in 1994. (fair to say pre-liberalization). The sixth pay commission was implemented in 2008. Effectively, government employees barely saw the "golden years". At a time when India's industries flourished more than ever before and the number of crorepatis grew exponentially, administrators were never given their share. Everybody around them enjoyed liberalization and the new riches but they were excluded. Do they have a choice? We can rant away about morals and principals all but that's not going to cut it. You and I don't work a job for morals and principals. We work to grow our careers and earn more. I did not go to IIM to study morals. I went there so that I could start with a 10 lakh job instead of a 3 lakh job as just an engineer. Is it wrong for a policeman or a excise officer to think the same way? We see the fact that a traffic policeman takes a 50 Rs bribe to let us go if we are driving without a license. But we do not realize that while we get 20% pay hikes every year, the poor guy has not seen a pay hike for years.

In a civil society, whenever a certain class is discriminated, they will rebel and try to establish parity. Corruption has simply become a way for the administrative class of workers in India to establish parity with the private sector. In my opinion, that is a natural consequence because they are discriminated against economically.

This may not hold completely true for the corruption that happens at the highest level I agree.

Now the bill -

Is it the right method of protest or not?

It's a simple phenomenon. One guy with pretty darn good credentials (for whatever he is worth, Anna Hazare is a well known figure and carries a brand image of being clean and neutral - a social worker) stands up and raises his voice. He seizes the moment. It might be selfless or it might not be (time will tell). A nation which has a herd mentality follows. The reality is that we have always been volatile. It does not take much to instigate the masses in India. The Gujarat Riots would not have happened otherwise. The Bombay Riots or Sikh Riots or the Mandal Commission would never have happened either.

The spark was ignited, what was a campfire it is now a raging forest fire. We will get a good lokpal bill in all likelihood. As the say - the end justifies the means. Right or Wrong, Anna Hazare will have taken a significant first step by seeing this bill through.

The more fundamental question is - Will the Lokpal bill significantly reduce corruption? Not in my opinion. It might at the highest level but not really at the ground level. It is a cure, not a prevention. It identifies and punishes the culprit but does not address the root cause of the crime.

Will the bill address the root causes? No it will not.

And what after the bill is passed? Will the revolution continue? No it will not.

And therein lies the other fundamental problem of India. Apathy of its citizens. We do not have it in us to sustain a movement. Will the same Lokpal members go and fast for hiking government salaries and making government jobs competitive against the private sector? Will they fast for administrative reforms - so crucial to eliminating the root cause? I can bet not. We will take the Lokpal and move on. Things will be better for a while but come back to where they are in a while. Unless you eliminate the root causes and improve administration, bring government jobs at par with private sector and bring in accountability in the government, status quo will return.

I'll leave you with a concluding thought - there's a poem which C Jagmohan, the ex-governer of Kashmir quotes in his book "My Frozen Turbulence in Kashmir" which is a striking reality -

It has happened
And it goes on happening
And will happen again
If nothing happens to stop it.

The innocent know nothing
because they are too innocent
The poor do not notice because they are too poor
And the rich do not notice because they are too rich
The stupid shrug their shoulder because they are too stupid
And the clever shrug their shoulders because they are too clever
The young do not care
because they are too young
And the old do not care
because they are too old

That is why nothing happens to stop it
And that is why it has happened
and it goes on happening
and will happen again.