The Dark Side of Democracy - The Daily Reckoning
The Daily Reckoning by Bill Bonner
On This Day - 24 August 2013
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- By Asad Dossani, Author, The Lucrative Derivative Report

Asad Dossani
The mainstream view of government is that democracy is best. Democratic governments accurately represent the views of the population, and thus make decisions in the best interests of those they represent. While democracy is successful in representing everyone's views, it can be very inefficient when it comes to actually accomplishing anything.

In India, we are suffering from this dark side of democracy. Most of us agree that the government must push through reforms, both economic and political, in order to get us out of our current slump. Unfortunately, due to a large number of competing interests and opposition, the government is unable to get anything done.

In contrast, a country like China, which has an authoritarian government, is far more effective in implementing policy. For example, when it comes to building factories, the Chinese government has no problem clearing land and displacing affected individuals. The displaced individuals will suffer, but the factory gets built quickly. In India, the displaced individuals would protest, and we'd have a long delay before the factory ever gets built. This is one of the reasons we lag so far behind China when it comes to manufacturing.

This does not mean that the solution for us is to do away with democracy. But we do need to make some changes in the way our government works. Our priority must be efficiency and effectiveness. If an entrepreneur wishes to open a factory, this should be a straightforward process. The same applies to a foreign company that wishes to invest in India. If we want to improve our infrastructure, this should be straightforward too.

The reason we have so many problems with implementation is that our politicians are primarily interested in themselves rather than improving the country. A politician is more interested in scoring political points against the opponent rather than working to promote the national interest. It is called public service for a reason.

The Chinese government may be authoritarian, but it is clear that they act in the interest of their country. Most of their policies are focused on increasing growth and exports, and they are very successful at this. If we could simply adopt the mindset of increasing growth and exports, we could go a long way.

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is a financial analyst and columnist. He actively trades his own and others' funds, investing primarily in currency, commodity, and stock index derivative products. Prior to this, he worked at Deutsche Bank as an analyst in the FX derivatives team. He is a graduate of the London School of Economics. Asad is a keen observer of macroeconomic trends and their effects on global financial markets. He is deeply passionate about educating investors, and encouraging individuals to take part in and profit from financial markets. To put it colloquially, he wishes to take Wall Street products and turn them into Main Street profits!

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5 Responses to "The Dark Side of Democracy"

Somenath Mukherjee

Aug 26, 2013

The success of Demcracy is directly proportional to the education of the people for whom & by whom the democracy works. The sucess of which is also dependent on the meritocracy of the society. In India we have been injected with the rights of democracy not the responsibilities. What we need is strong governance else like the Union jack that flew on over us till 15th August 1947 the Chinese National Flag will flutter over us. The nation is at the cross roads & only a strong leadership can save us from the collapse & like any leadership in a warlike situation we need fast decision making capability clearly understanding that of them some will be wrong when viewed in retrospect.

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THIRUMURTHY R

Aug 26, 2013

It maybe more productive to evaluate the merits and demerits of India and China beyond the system of polity or political economics which your blog is dealing with. For that we need a different frame of reference which maybe broadly seen as taking into account the human and ecological cost of all that we do of which economics and politics are only two aspects, irrespective of the system of polity. After the unprecedented global fall out of the 2007-08 economic crises that continue till date streams of thought of many disciplines are being forced upon economists and statesmen of repute by the sheer devastating force of those consequences. Irrational social/individual behaviour driven by greed and fear were spreading fast and the countervailing forces of sanity and farsightedness were not able to inject some balance into the overall dynamics of politics and economics, to take just two aspects of what we did to ourselves till the financial meltdown of 07-08 happened. We are continuing down the same road but the mad mad rush, the “irrational exuberance” is now being followed by its counterpart, that may perhaps be called as “life-sapping gloom” showing up in unemployment, lack of the kind of economic growth that we were used to and so on.
If this is at the social-economic level, its personal equivalent is the bipolar disorder in psychiatry, characterised by states of mania, of omnipotence, of delirious joy, of thoughtless, highly risky decision making followed by states of depression, of loss of self-worth to such an extent that suicidal thoughts are common and are often tragically carried out in action. Booms and busts in economics and bipolar disorder seen with milder severity in many people, in my humble opinion, are closely inter-related. Tackling this paradigm of problem is not unknown to ancient civilizations like those of India and China. Now is a historic opportunity for both to draw upon their civilizational strengths. India should hark back to its Dharma, Artha, Kama and Moksha model as motivational tools to right not only the ills of economics and politics but more importantly the ills of its modern society like overall decadence of values and morals and consequent depth of depravity of increasing crimes of all varieties. China perhaps may draw upon the Budha's teachings enshrined in the Dhammapada, which was once widely prevalent in China. Scholars have compared the two systems and shown they are one in essence. Briefly, both are underpinned by social acceptance of and approval for sublimating our life force towards higher levels of altruism and transcendence of the 'I-Me-Myself' cocoon of our evolution.
I am aware I have apparently strayed far away from the topic at hand but I draw some encouragement from small tidbits of news like the one in the New York Times of 25th August 13 in the Economic View column under the head “Public Policies, Made to Fit People” by Richard H Thaler, which says that the White House is set to undertake a new initiative to involve social and behavioural scientists in Policy Making. Behavioural science and motivational analysis conflate in self-actualization, that is, re-writing our life scripts and rewiring our cognitive processes that lead us to our full potential for collective and individual happiness. It can be shown by abstract thought that the Dharma-Artha-Kama-Moksha of Hinduism, and the Dhammapada of Budhism, if rephrased in non-religious terms would meld with the deeper aspects of behavioural science and motivational analysis. From this may arise new streams of thought that would inform political and economic thought, not to mention race and international relations and geopolitics. That could be the way to a Brave New World.
This may be whistling in the darkness. This may also be a clarion call. It all depends on the hope-optimism quotient of one's worldview.

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sunil

Aug 25, 2013

The reason we have so many problems with implementation is that our politicians are primarily interested in themselves rather than improving the country. A politician is more interested in scoring political points against the opponent rather than working to promote the national interest. It is called public service for a reason.

You have aptly said it all . Every party , in order to come into power is promising Heaven @ the cost of our Nation & poor Tax Payers . WE SHOULD NOT TOLERATE THIS FARCE UNDER DISGUISE OF DEMOCRACY . ENOUGH IS ENOUGH .

But what can an average Intellect Indian can Do to change the Scenario , That's the million Dollar question .

An Intellect can write & talk about solutions , but given our ever increasing moron populace , how can the problem be tackled Democratically . . . .

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naishadh desai

Aug 25, 2013

what has been written is too general,like a student writing an essay.
there are no concrete measures suggested,this is armchair writing,

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R Tayal

Aug 25, 2013

You will agree this is an age of information overload. Week after week I find the pieces by Asad Dossani talk of inanities and generalities without adding to the wisdom of readers. You may think of discontinuing this column, or at least unsubscribe me from it.

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