Bad Planning or an Indifference to People?

 I have had to travel through Porvorim more often than I would have liked. Each time I am struck by the chaos and wondering does it have to be this way.

Do we plan for the fastest completion time or as fast as possible while minimizing the inconvenience during construction? 

Do we even consider the inconvenience and implicit costs caused by the chaos during construction?

Does the planning even include the impact on the people who need to use these roads and have no alternate option during the construction? I think we are invisible to the planners. Just a group to be tolerated while a great and bright future opens up to us.

I am certain that after the flyover is completed, I will again be able to reach the Dabolim airport from Mapusa in 50 minutes, like I used to do when I moved to Goa 25 years ago.

Meanwhile I crave for a future paradise where I can walk without fear or looking over my shoulder keeping track of traffic behind me. Travel by  public transport and not have to worry about where to park.

Oh, well. If I had money, I could have moved to Europe.... 

 

Living Wage, Inflation and Guaranteed Minimum Income

Suppose we want less traffic on the roads:

We could reduce the need for private cars if the taxi drivers were paid a guaranteed basic income so people use taxis instead.

The concept can easily  be expanded to shared taxis, mini-buses and any other type of public transport.

It is easier to sell the idea if it is not treated as a subsidy but as a saving on needless infrastructure of roads - which also frees a lot space which could be better used for various public purposes.

We also want a comfortable society.

I am not comfortable when I see people struggling to survive. I cope with it by avoidance. There is nothing I can do as an individual that will help.  Donating or giving to charity makes me feel even worse.

I would love to see a living wage implemented even in India. 

We want to see a brighter future. We need peace and a low inflation.

If the wages of the workers in supermarkets, coffee shops, Udipi's,  child care centers, house hold workers, etc. are to be living wages, then the prices will increase.

Suppose instead each of these persons gets a minimum income. How much do they need to be paid? 

Depending on the nature of the work, we may actually be able to lower the prices. I can imagine a person having to clean toilets having to be paid even more than now while a child care worker may well even volunteer for just the pleasure of being surrounded by little children - esp grandparents whose children live far away :)

I wonder what has happened to minimum income programs for the common good -

"Barack Obama, in a reflective speech in South Africa, mused that basic income would figure prominently in the years ahead, and prominent corporate folk endorsed it again, including Mark Zuckerberg and Elon Musk."

This was in 2019. I hope the support of Elon Musk still holds. At least it did in 2021 as well.

 

 

 

Tremendous Expenditure and Progress in Infrastructure and We are even Slower

 I drove for 50 minutes from Mapusa and just reached Bambolim. It would have taken another 20 min to reach the Dabolim airport.

When I had moved to Goa 30 years ago, it would take me 50 minutes to reach the airport.

To be fair, a year ago, I had again reached the airport in 50 minutes with the new bridges over Mandovi and Zuari rivers and the new expressway from Bambolim to Zuari bridge.

I am also pretty certain that once the elevated highway is completed in Porvorim in a year or two, I will again be able to drive to the airport in 50 minutes.

I suppose that is progress. Here is an example of a regular experience for me and this is 2 and half years AFTER the report and - “We have written to the NHAI about the issues at the junction and steps to be taken to rectify the problem”. 

Probably the designers did not include or talk to anyone who stayed in Mapusa or was familiar with it.

Suppose instead, we spent a part of the money spent on improving highway and bridges on public transport, could it have been any worse?

First objection that comes to mind is from the categorization of the expenditure:

• Building roads and bridges is spent on infrastructure - A GOOD thing as it is an investment for the  future
• Spending money on public transport is a subsidy - Obviously a BAD thing. 
• Why can't we categorize it as a SAVING of money we do not need to spend on infrastructure to have an even better quality of life in the future?

 

Can inexpensive services and decent earnings co-exist?

A friend posted a link to Why Uber is a scam: maths explains. I had seen it before but I now have an additional perspective. I do not keep a car in Chandigarh and use Ola/Uber reasonably frequently. I would have liked to use the same option in Goa.

I can easily believe that in the long run, given the fares, the drivers cannot be making a comfortable living. I also realize that if the fares reflect my desire that drivers make what I believe to be a comfortable wages, I would wind up owning a car.

There is a conflict and no easy way around it. As a society, it is in our collective interest that there aren't too many cars - both to save on parking spaces and prevent congestion and pollution on roads.

Long term solution is obvious and inevitable. The Ola/Uber vehicles will be driver-less.

Meanwhile, what if we had a minimum income provided to all citizens. Then a driver's earnings are over and above the minimum needs. Hence, the needs of society, the consumer and the service provider can coincide.

This model would be useful for all services from helping patients/old people who are bedridden or need assistance to inexpensive coffee/tea shops not exploiting the workers.




 

Is Silicon Valley too hyped?

After I came across "Where is Europe's Silicon Valley?", it has been bothering me. If I were young today, I would be very reluctant to come to Silicon Valley based on the comparison of my visit 2 years ago and now.

I had come back to San Francisco area for the first time after over 40 years 2 years ago. I was surprised by how little it had changed. The public transport was similar though the street cars were replaced by light rail. They were traveling on the same paths, except that now light rail was underground on Market street. I could follow the same routes I used to take as a teenager and a student here. The houses in Sunset district seemed the same. The house we had rented for US$200 probably rented for a lot more but it was still better than the fall in the value of the rupee during the same period. I had liked the visit.

So, what has happened in the last two years to make me unhappy about this place? It has to be the rate at which the rents are increasing in comparison to the salaries. If a person was already paying 40% of take home on rent, obviously the quality of life is going to suffer.

Hence, it was nice to read "Jimmy Wales: London is Better for Tech Than 'Dreadful' Silicon Valley"

“I meet people around London and they ask ‘when do you go back to San Francisco?’ assuming I’m here for a few days, but I live in London,” he said at the launch of Tech.London.

It takes time for people's mindset to change and it will.

Even in India, housing remains a big issue. When I started, as my uncle told me that even his colleague at a newspaper, who was a committed communist, had to pay black to buy a flat. Hence, buying a place was a very difficult proposition for young people without family money. No longer thanks to loans and organized builders catering, in particular, to the IT boom.

The bottom line - the direction of change matters more.
In India, we see hope as our standard of life keeps improving. In the west, we can look forward to the deterioration of our life in comparison to that of our parents. 

No wonder I am happier in Goa or Chandigarh or even Pune :)

About time first premium of lapsed insurance policies is surrendered to the insurance regulator

The following statistic in Hiking FDI limit in insurance is remarkably illustrative of  morality of companies:

It is quite disquieting that some major companies have a very high rate of policy lapses like Birla Sun Life 51 per cent, Future Generali 49 per cent, ICICI Prudential 42, Reliance 38 and Bharathi Axa 36 per cent.

It explains that my effort to help a retired person scammed by insurance agents was hopeless.

I can't imagine profitability being any higher than on policies which lapse after a single premium.

Given the above statistics, it would be great if, at the very least, the premium of policies which lapse after the payment of just one premium is confiscated by the insurance regulator.

Furthermore, cancellation of policies should hurt the bottom line. Hence, the insurance companies should not be allowed to deduct any cancellation or service charges when refunding the policies which have been cancelled during the "free look" period.

Accidents and Compensation - Losing the moral issues

I recall seeing a show as a young boy which deeply moved me.  A person had just been acquitted of causing a death in an accident. The accident resulted from a medical problem(blackout?) the car driver had but without being aware of it. However, this person is not able to come to terms with his own role and commits suicide.

This story is refreshed in my mind whenever I read news of accidents and compensation. It seems as if the moral culpability seems to be getting lost in the financial compensation conflict. I doubt if higher compensation causes the drivers to be more cautious - e.g. "people in that car may be very well off so I had better be careful".

The compensation was awarded now for an accident four years ago. So, wouldn't it be better if there was a very fast, unambiguous payment to the victims without any need for courts or tribunals and without having to determine the status and potential worth of the victims in society.

Each individual should have his or her own life/accident insurance  to ensure that his/her family is not financially hurt by an accident, whether in traffic or roof falling down or gas cylinder exploding or ...

There has to be a better way to minimize the number of accidents and ensure that the victims do not suffer or have to fight for their rights.

Interesting perspective about medical malpractice suits in the US. It seems to reflect that the malpractice suits are not a financial burden but rather a significant cost to the society in non-monetary terms.

But medical malpractice is a business driven almost purely by profit through tragedy. Decisions often hinge on the theatrical performance of two competing teams to an audience selected specifically for their lack of knowledge regarding the issue they're judging. There has to be a better way.

A change in the attitude of the doctors may have reduced the malpractice suits. E.g. the following which still holds for India

It seems hard to believe now that there was a time when medicine was such a paternalistic profession that we were never expected to consult with a patient about any treatment plan or procedure (I'm the doctor, you're the patient was the expected answer to any question). It was once considered unethical even to inform a patient of a bad prognosis (we felt it would be detrimental to their health if they knew they were dying).

Who should compensate

From the news report:

The accident occurred because the taxi was being driven at a high speed and the Canter driver suddenly applied brakes in the middle of the road.

 ... Gurdev and Uday Shankar to pay the family a compensation of Rs 1.19 crore, including costs. However, in the interest of justice, the court ordered that Bharti Axa General Insurance Company Limited, the insurer of the Canter, would make the payment of Reena’s share of Rs 60 lakh and then recover it from the two accused.

I would have guessed that the taxi was unambiguously at fault for not keeping a safe distance - no matter what the driver in front does. Canter driver may be fined and penalised if the brake lights were not functioning.

Justice? Wasn't the taxi insured? Isn't it a legal requirement to have 3rd party insurance? Who monitors it?

Value for Society versus Economic Value

As I read about the smallest banking trojan in circulation, I was pleased that I will soon be converting one of our neighbours to Linux. I managed to fix her Windows problem. I also installed the open source Clam anti-virus after removing a commercial product which kept scaring and nagging her to pay for renewal.

However, she said that she wanted me to install Linux on her free partition as I had mentioned that I have never needed to use an anti-virus software!

The entire anti-virus industry would not have appeared had it not been for Windows. Obviously a loss to the economy, but would it have been a loss to the society?

Since I do not have to make effort to make money, I can spend my time learning. Thanks to open source, I can, without having to spend anything over and above my internet connection, learn OpenStack, Hadoop, Zotonic(an Erlang based Web framework), and whatever my mind decides is exciting or useful to know this week or month! My experimentation does not add any value to the economy. I like to think that the open source universe does add value to the society as it makes it possible for anyone to learn.

There is little doubt that windows has created a lot of economic wealth. I am not so sure it would be even a fraction of the social wealth created by Linux and open source software. That is, if we could find a way to measure social wealth! E.g. see or read "The Clothesline Paradox" though I would like to think that we can find a way to measure wealth without resorting to money.

Irony of paying less tax for making money from money by doing nothing

As I get older, I would have expected to become more conservative. Instead, I am more likely to be upset by Arun Jaitley promises more income tax relief if economy improves and discussions on tv where it is taken for granted that India has a high rate of taxation, which needs to be brought down. Rare left wing economists talking about the low tax to gdp ratio are brushed aside.

I find it ironic that I pay less tax now thanks to a major part of my earnings coming from divindends in mutual funds than I did when I worked 9 to 5. What is  so special about earning money from money?

In fact, the government takes a 20+% on dividends of non-equity funds, which benefits the richer people far more than people like me.

I suppose, the motivation is supposed to be an incentive for people to invest, but what will I or any person with surplus money do? Can't be kept under a mattress. People like me may put it in the bank instead but the motivation for investing in equity funds is hardly the low tax rate. It is the gambling instinct of riding a bull run :)

No one starts a factory in the hope of paying low tax on profits! Yes, the richer people can move the money to other countries. I would say let them. How much can Cayman Islands and other tax havens consume?

Since I was not going to get a government pension, it was obvious that I needed to save and not spend. However, if the government taxed me more but had a negative income tax for my old age, would it have mattered?

We need to worry about what will happen as we can't stop the following from happening - "Hi, I’m a tablet. I’ll be your waiter tonight".

As a consumer(in US), I do not want to pay the waiter 15% or more tip. I do not want to feel guilty about not paying the tip because the person is probably being paid a minimum wage. As a consumer in India, I am immune to the treatment of such workers in Udipi-like joints. I have learnt to close our eyes as the alternate would make me far too aware of my own incompetence and helplessness and make it impossible to eat out (or do anything) at inexpensive places. Even in the US, I wonder what are the earnings of fast food joint workers but they were supposed to be students working part time to supplement their pocket money.

We need to re-think the importance of money - investments increasingly no longer imply wealth for the society but only for some individuals in the society.

I recall reading a comment. There will be no shortage of things to do for humans in future. The issue is whether they will be paid for it. No one can deny the importance of raising children and the effort involved in it. Today, does the society pay a mother (or father) who has chosen to stay at home for this task beyond the maternity leave?

UPDATE: Longer holding, higher tax takes sheen off debt funds
Better, but wouldn't it be simpler to just treat it as interest from bank deposits no matter what the duration? No special treatment and treat dividend distribution tax as "tax deducted at source" to be treated like any other income.

While at it, do the same for equity funds.

I wish the exercise of increasing capital gains tax was philosophical rather than just a way to collect more tax.

More EPS fine provided the employees can opt out into NPS

News items like EPS-95: Rs 1,000 monthly pension, 28 lakh to benefit really upset me. I realised the scope of this scheme only on retirement! This is a scheme which sought to give private sector similar benefits as central government pension (discontinued for new employees as it is a financial burden for the government -  actually, the current tax payers). The scheme is subject to some arbitrary constraints which make it viable at the expense of the better off. Charge higher taxes but don't cross-subsidize in a non-transparent manner.

I had assumed that I was not a member of EPS because I had not opted for it when it came out. I did not realise that my option was not valid or relevant after I had changed my job and moved from the company managed fund to the government managed one.

From the same news item(emphasis mine):

At present, workers whose basic wage at the time of joining is up to Rs 6,500 per month, including basic pay and dearness allowance, can be subscribers of the EPFO schemes.

This is news to me. The companies always me the impression that membership to EPFO was mandatory. Given a choice, even PPF would have been preferable. And these days, NPS would most likely be the preferred option for anyone earning more than the EPFO limits.

I suspect the limit has been increased to make the operation of EPFO/EPS temporarily solvent and postpone the actual financial problems of the organisation to the next generation.

New IIM's and IIT's - why not University Towns

As I sat passively listening to various post budget discussions on Rajya Sabha and Lok Sabha TV, one commentator struck a chord. It is fine to build new IIT's but without quality faculty, mediocrity will prevail. And why would well qualified people go to remote places?

In another discussion, one commentator, I believe an expert in economics, was asked about jobless growth. He ridiculed it and said that there was no such thing. You cannot have growth without jobs. It blew my mind. I wanted someone to question that comment but no one did. It is not just a problem of the rich countries with software eating jobs.



The government wants to create new IIT's, IIM's and urban centers of excellence. Nothing wrong with the idea itself.

So, what if instead of creating each institution in a separate place, the government creates university towns starting with a student population of 10,000 plus. Obviously, Berkeley and numerous small but well known towns in the US come to mind. However, our visit to Manipal had been a remarkably pleasant experience. Now one can even point to the CEO's of Microsoft and Nokia and suggest that Manipal may be an example worth emulating.

A university town ensures that academic and student populations of diverse disciplines interact and learn from each other and not just what is taught in classrooms. The size of IIT, Kanpur assured that there was just one restaurant, I think called Red Rose. It was dark & dingy and I saw rats running around. (I spent a year as a postdoc at IIT,K). An adequate student population ensures a lively, vibrant environment. These are fun environments for faculty and families as well.

The best way to prepare for the future is to learn and not based on the jobs available today, which is why I had thought that the Delhi university four year program was a worthwhile experiment. University towns may instead be tremendous opportunities for the young Indians.

Personal Experience:
Ropar is not all that remote just an hour's drive from Chandigarh. Yet, the IIT Ropar has a problem attracting faculty, at least in Computer Science. I enjoyed being able to experiment with content and style of teaching unlike in a traditional engineering college. Although I was not very happy with the outcomes, I was ready to try another experiment based on this video of Eric Mazur. However, the desire to experiment and see if students would learn better was not enough compensation to drive an hour each way for even three days a week.

Build one in Goa

Robots will take jobs, Inequality will grow & Rich will inherit more

I read A billion shades of grey in the Indian Express a couple of days ago and the next day came read Today In Dystopian War Robots That Will Harvest Us For Our Organs.


Reading the two makes it obvious that the Economist article is wishful in thinking that

But governments should focus not on redistributing income but on generating more of it by reforming retirement and education.

Seems odd given that their analysis also states:

Wealthy old people will accumulate more savings, which will weaken demand. Inequality will increase and a growing share of wealth will eventually be transferred to the next generation via inheritance, entrenching the division between winners and losers still further.

One would expect that some way of fairly increasing inheritance tax seems to be obvious option.

If more people are educated better, it is far more likely that even programmers will earn minimum wage and a smaller proportion of them will be employed. 

It is interesting that discussions around what the kind of an economic system we will have - After Technology Destroys Capitalism is becoming common.

Rich Get Richer not quite the Fairy tale of capitalism

It was a very pleasant surprised to read Mihir Shah's Fairy Tale Capitalism today after my entry just yesterday. For example,

In slowly growing economies, past wealth takes on a disproportionately higher importance. Inherited wealth grows faster than overall output and income.

Exponential growth has obvious limitations; so, the growth has to slow down.

Thomas Piketty is striking a chord :) Hopefully, the interest generated will result in political changes forcing the politicians to bite the hands which feed them

Create Sovereign Wealth using an Inheritance Transfer law

Income inequality is growing and is now considered as the most serious risk to global stability. Sovereign wealth may be a way to fund and manage the growing economic inequality especially in view of  jobless growth.

While countries with natural resources or surplus income may be able to create sovereign weath, how can a country like India create one?

One of the valuable taxation tool to reduce the obvious advantages of being born rich is the inheritance tax. India stopped the inheritance tax in 1985. It is easy to understand the implementation problems. Aside from estimating the value of the assets, how will the inheritors convert assets into cash so as to pay the government?

Current capabilities of technology and software make new options possible which would have been unthinkable using manual systems.

One way would be that a proportion of the assets as per the inheritance tax rate is transferred to the sovereign fund of Govt of India. Operational control of the assets may continue to remain with the legal heirs. However, the appropriate proportion of any income derived from the assets would belong to the sovereign fund.

For example, any residential property would continue to be in the possession of the heirs with no liabilities except when they sell it. Keeping all such records on the computers is trivial.

Such a mechanism would make it possible to have a law which is not riddled with exceptions to minimize unfairness.  Furthermore, as an asset it will provide long term income to the government rather than additional income which is likely to be wasted especially around elections.

Any  issues related to improper reporting of income are no worse than the current experiences and practices in collection of taxes.

If such steps are not taken, it seems inevitable that more and more wealth will be in the hands of increasingly fewer people.
 

Prime Minister Communicates in Rajya Sabha - there is hope for Indian parliament

After a long time, I watched Rajya Sabha in session and listened to the Prime Minister's statement about the economic problems and the discussion that followed.

It demonstrated that Manmohan Singh can communicate! It is sad that he does it so rarely. He comes across very nicely in small groups (obviously televised as I have never seen him in person) and interviews  but sounds boring in speeches.

I wish he would have a monthly one-to-one interview, possibly with a different interviewer/channel each month.

I recall the disappointment with V P Singh's talks on TV after he became the PM. Somehow, his language and presentation moved from conversational and inspiring to bureaucratic and stiff. Possibly, TV was a new medium in India and his advisors must have been bureaucrats. Today, he could have seen Obama, Blair, Clinton and realised the alternative styles and ignored the bureaucrats.

V P Singh as PM seemed to talk as a PM was supposed to "talk" - serious and remote. It was sad and that stiffness probably caused his ideas and aims of social justice to be missed by the public. It is ironic that there was no opposition to Mandal after his government fell. I like to believe that discussions on social justice at that time might have resulted in far better mechanisms for positive discrimination to achieve some common aims than the rigidity of reservation percentages.

Back to the discussion in the Rajya Sabha today.

The points raised by the opposition were pertinent though surrounded by verbosity. I wish they would follow the elevator pitch. Were their interventions as precise and pointed as one which would not be longer than an elevator ride, effectiveness would have been far greater. They may even learn from twitter. Raising one pointed issue may raise the level of debate and cause discomfort to the government to a far greater extent.

It was ironic that when the PM responded and pointed out that a functioning parliament is critical for investor confidence, the opposition interrupted him repeatedly. They didn't seem to realise that they were proving the PM's point!

I loved PM's one liner to an interruption I could not hear - "I am not the custodian of files in the coal ministry."

One question which no one asked - why consensus in parliament is needed to improve bureaucratic processes and reduce red tape?

Food security bill, pensions increased for bureaucrats and share the pain fo the retired rest

I had a disturbed night's sleep, quite possibly affected by "Markets give UPA's Food Security Bill a thumbs down, fear its impact on economy". However, that was not the first news which struck me.

The news I noticed was the bureaucrats taking care of their retired bureaucrat parents! No wonder, it is hard to believe the finance minister, Chidambaram, no matter how much one wants to do so. His worst enemies could not have chosen a more symbolic time. My mother's pension will improve but my comfort depends on the economy and if the current trends continue, I will have to be dependent on others or search for a job whether I want to or not :(

It seems petty to question the benefit given to the bureaucrats who have spent their life serving the nation. I recall an episode of the Twilight Zone, where the aliens have come to earth which each one committed to the book "How to serve man". It was a cook book :)

Our fate: wasted onions in peak time and wasted parliament during session

The handling of food as illustrated by Onions keeps surprising me. Why are we not preserving food?  Another news item a few days ago was even more saddening - In onion belt, BARC unit to increase shelf life lies unused.

We would be happy to use dehyderated onions whenever fresh are too expensive for cooking or even routinely for its convenience. Safal frozen peas has had a significant impact on the way we consume peas. What's puzzling is that what is preventing food processing from taking place. It makes no sense that we keep wasting food in season and paying a high price during shortages.

And our parliament is in uproar over missing files and who should tell that they cannot find them. Though any time I visit a government office, it seems amazing that they can find ANY file!

Our fate appears to be wasted onions in peak time and wasted parliament during session :(

I wonder what would have happened if our currency was part of the Eurozone and instead of the currency rate collapsing, government had to implement a Cyprus-like solution. Perhaps then the discussion in the parliament might have been more pertinent.

Robots, Software, Internet destroying jobs?

Although the Foundation Trilogy made no mention of robots, in the Foundation series, it becomes clear that it is a robot which is guiding and preserving the human race. It would appear that Asimov had greater faith in robots.

It is easy to trust software and robots as they would act as per the laws implemented, whereas humans may state allegiance and adherence to some laws while disregarding them in practice. (This obviously leads to the corollary for software to be open source otherwise how can we possibly trust it.)

My faith in software was emphasized yesterday. I got a call from my satellite tv service provider. I did not understand what the point of the call was and paid little attention. It appeared to be a confirmation of my renewal just two days earlier.

However, I have no idea how the human being interpreted what I said and changed the subscriptions and got rid of the English channels, which are about the only ones I watch on satellite tv - other than Rajya Sabha and Lok Sabha TV's.

I now have to struggle with other human beings to get the subscriptions rectified. It is not yet painful enough to switch service providers.

This personal experience illustrates the predicament for human societies. What will most people need to do to live a comfortable life?

HIt and run - What about the victims?

I seem to have become more conscious of the plight of victims after watching documentaries on this topic on TV5 Monde. This line stared at me: "the family of one of the injured children may have to sell their hut in a slum to raise money for their daughter's surgery" in a story about hit and run.

I wish the focus would change from "whom to punish" to "how to help".

Shouldn't the society mandate free immediate treatment for victims. The hospitals should recover money from insurance companies or the government in case no insurance claim is possible.

Government being the default payer would appear to be fair as it is an obvious failure of governance if the car cannot be located or was being driven without insurance.

Ironic: Garbage - those who don't need it, want it!

Today's news: "Oslo has a problem: Shortage of garbage to generate power"

Norway has oil and gas as well. We have very little oil and gas but a lot of garbage and few plants to process the garbage! On warm days, I can smell the garbage in Chandigarh when we go for a walk. The odour is definitely stronger than that of roses in Rose Garden :(

I suppose no one wants a garbage disposal plant in their neighbourhood just as they don't want a nuclear plant in their neighbourhood. I wouldn't want to live downstream a hydroelectric dam either.

So, until we have fewer people so that we have space, we may need to find a way to send the garbage to Oslo in exchange for some barrels of oil :)

Some more news of robots making the rich in US richer! A big emotional advantage will be that the consumers won't have to feel guilty about cheap clothes from Bangladesh where people have to work in high risk environment.