Love and marriage, in India

India is changing, and rapidly too. Naturally, this is reflected in marriage as well. My marriage to a non-Hindu was a pretty big deal years ago. I don't think such issues matter that much anymore. Since my marriage, here is the listing of a few "non-traditional" ones (out of the eight younger cousins):

• Male cousin married a non-Tamil/(not Brahmin too?)
• Female cousin married a non-Tamil (not Brahmin too?)
• Female cousin divorced--a first in the family
• Female cousin married a non-Tamil-Christian

Four of the eight--50%--have stepped outside the traditions, even though only one out of these is outside India. The rest live in India, and all are professionals. So, all the more for me a reason for me to think that this writer in The Hindu is on to something:

[Let] us take a look at the “New Indian”, a recently emerging metropolitan creature who is perfectly happy to live in India, warts and all. Even if an overseas work assignment is sought it is more for the experience, the independence away from the family and for enhancing the résumé than for leaving the homeland for good. Apparently, the grass is green enough on this side. Paav baji and masala dosa are as much enjoyed as pizzas and hamburgers; Kumbakonam degree coffee as much as Cappuccino; tender coconut water as much as energy drinks; Shah Rukh Khan as much as George Clooney; the salsa as much as the garba; Art of Living as much as Stephen Covey. In other words, the New Indian does not reject India and Indian. Other things from other parts of the world just get added on. The New Indian’s patriotism is not of the jingoistic, chest-beating variety. Being an Indian is just a fact of life. It’s who s/he is. It doesn’t need to be cried out from the rooftops, nor does it need to be a well-guarded secret.
The New Indian is more pan-Indian in perspective, perhaps on account of leading a more mobile life. Born in Ludhiana, educated in Kolkata, MBA from Lucknow, working in Chennai and married to a Hyderabadi is no longer an exceptional scenario. The New Indian does not make a big deal about language; it is seen as only a tool for communication and no longer defines identity. The New Indian lives life more consciously. As a result, relationships are more emotionally intense and personal experiences more meaningful. However, the New Indian is also impatient, brash and in-your-face. Frustration tolerance is poor. Instant gratification is demanded and the tendency towards impulsive decision-making is high.

What we've got here is failure to communicate

To remember Paul Newman, here are the final few minutes from Cool Hand Luke, which includes the immortal movie line, "What we've got here is failure to communicate"--a line that is applicable to many, many situations in real life too

Economists disagree on the $700bn bailout

When economic conditions turn sour in Argentina or Indonesia, we give very clear instructions on what to do: balance the budget, cut government employment, maintain free trade and the rule of law, and do not prop up failing enterprises. Opponents of free markets argue that this advice benefits international financiers, not the domestic market. I have always believed (at least since I began to understand economics) that the U.S. approach was correct. But when the U.S. ignores its own advice in this situation, it reduces the credibility of this stance. Rewriting the rules of the game at this stage will therefore have serious ramifications not only for people in this country but for the future of global capitalism.

That was University of Chicago economist Robert Shimer in a lengthy email that Greg Mankiw has posted in his blog.

Brad DeLong has a different thought:

To get get a $500B macroeconomic gain in production and employment, Paulson wants to take on a position with an expected value of -$100B. But the true value of that position could be anywhere between +$200B and -$400B. Looks like a good
bet to me.

These two comments by themselves ought to tell us that economics is far from being a science. It is a discipline in which arguments and debates are the key, and not any indisputable facts and theories. If only economists would recognize that!

Finally, how about this following comment by Shimer:

let me be clear that I agree with your comments about Ben Bernanke. I too know him well from the seven years I spent with him on the faculty at Princeton and I share your respect for his intelligence. I also recognize that he is far better informed about the current situation than I am. This does not, however, mean that he is perfectly informed. Indeed, looking back over the last 13 months, it should be clear that the Fed and Treasury have repeatedly underestimated the extent of the problem. In such an environment, the distributed knowledge of professional economists and other imperfectly-informed observers may be superior to the knowledge of the Fed staff. In other words, you write, "In his capacity as Fed chair, Ben understands the situation, as well as the pros, cons, and feasibility of the alternative policy options, better than any professor sitting alone in his office possibly could." That may be correct, but I am not convinced that he understands the situation better than the collective wisdom of all professors.

Explaining "short selling"--the power of Web2.0

The fantastic aspect of Web2.0 is clear in videos like the following--where anybody with content knowledge is now able to deliver it to a mass audience using multimedia and completely bypassing the mainstream media. If only we in academia would adopt such practices and make our lectures more interesting and accessible, instead of it being restricted to "closed doors" and with 19th century pedagogy!

The end of laisser faire capitalism?

As we learnt from Francis Fukuyama's "The End of History", and later from John Horgan's "The End of Science?", it is not a good idea to talk about the end of anything, I guess. But, "the end of X" always works as an attractive title though, as this piece from the Financial Times shows. But, don't be fooled by the title--some pretty neat observations there. A few excerpts:

Europe is headed towards the end of laisser faire capitalism. Nicolas Sarkozy is only the latest leader to toll the bell on principles that have delivered, over the past 30 years, unparallelled global prosperity – and now a tremendous bust. “The all-powerful market which is always right is finished,” said Mr Sarkozy. Even Hank Paulson, former Goldman Sachs boss, has said “raw capitalism is a dead end”.
Before everyone dons Mao suits, however, it is not clear how raw that capitalism really was. The economic freedoms of the recent past were more of a tremendous party than a defendable principle, fuelled by cheap credit and state support.

That cheap credit and extensive state support is what has come back to bite us big time. I can imagine that the left will use this to bolster their argument that more state intervention (regulation) is needed, and the right will argue that too much of state intervention was why the markets got it so wrong. I tell you, ne'er the twain shall meet!

Ralph Nader and the "Obama girl"?

I want your money

The latest issue of the Economist has a cover graphic that says it all :-)

Excerpt from the lead article:

Spending a sum of money that could buy you a war in Iraq should not come easily; and the notion of any bail-out is deeply troubling to any self-respecting capitalist. Against that stand two overriding arguments. First this is a plan that could work (see article). And, second, the potential costs of producing nothing, or too little too slowly, include a financial collapse and a deep recession spilling across the world: those far outweigh any plausible estimate of the bail-out’s cost.

Interestingly, Paulson is "caped" in this Daily Show satire too :-)

(Big) Brother, can you spare me a dime?

A month ago, I blogged about the big three automakers pushing for subsidies from the feds. Well, they have it, and Rick Newman explains the 25 billion dollar gift check from us, the taxpayers. It gets worse; Newman writes that "There's more aid coming. This year's $25 billion is just a down payment. The automakers now plan to ask the government for another $25 billion in loans next year. It's just spare change, after all."
(via Megan McArdle)

Ralph Nader warned about derivatives

It was way back in the mid-1990s, I think, that I went to listen to Ralph Nader. This was in California--in LA. I had expected him to talk in the language of us mortals about corporations, environment, labor, .... Instead, he went all technical and it felt like I was in a graduate-level economics course. His focus was on derivatives and how they were being abused by Wall Street financial experts. The audience, not too large to begin with, almost fell asleep. But, it turns out that, as always, Nader was on target.
Unfortunately for him and for us, nobody paid any attention to Nader.
Then Enron happened. And even then nobody paid attention to the complexities in derivatives that these MBAs were concocting. The traders, on the other hand, started coming up with even more crazy schemes to essentially gamble with other people's money.
When Bear Sterns tanked last March--six months ago--that apparently still didn't wake up those who were supposed to safeguard the "public interest."
Oh well .... I guess I should feel better that if Congress passes a 700-billion dollar bailout, I will literally own a share of America's real estate--more than my own home that we pay for with blood, sweat, and tears!

9/26 update: Nader has a terrific commentary at Cockburn's Counterpunch. His postscript there is something that the "investor nation" should pay attention to:

Shareholders also have some work to do. They should have listened when Warren Buffett called securities derivatives a "time bomb" and "financial weapons of mass destruction.” The Wall Street crooks and unscrupulous speculators use and draining of “other people’s money” out of pension funds and mutual funds should motivate painfully passive shareholders to organize to gain greater authority to control the companies they own. Where is the shareholder uprising?

Nasty comments and learning experiences

First a dietitian propounding on economics, now a geography teacher. SJ editors, staff and apparently college teachers haven't a clue what economics/labor economics is about. ...
Western must be scraping the bottom of the barrel for teachers.

That was a comment to my opinion piece in the Statesman Journal (Sep 25th).
That comment is an example of how NOT to engage in debates and discussions. Such comments are wonderful learning experiences though :-) I often tell my students that in discussions we ought to stay focused on the issues, and should not launch into ad hominem arguments. I can use this as yet another example, I suppose.

So, what was the opinion that attracted such comments? Here it is:

State officials deserve better salaries
I support higher compensation for the governor, legislators, judges and other senior state officials.
The world and the state have significantly changed since Oregon's Constitution was adopted 150 years ago. The dominant economic activities then, for instance, were related to natural resources — farming, fishing, forestry — which also were seasonal. Citizens interested in politics and governance could then set aside time from their professions (if they could afford to, of course).
The issues also were less complicated than they are now. For one, they did not have to be concerned about the problems of most of the population — women and nonwhites, who did not have voting rights until much later. That itself would make the agenda for any government very light indeed.
Further, the much simpler economy meant that it was a limited range of issues that needed any discussion at all. An example will illustrate the point. There was no need
for discussions on a "bottle bill" in the 1870s because, well, there were no soda cans or bottles littered on the beaches and along the highways. Wait, there were no highways then!
In contrast to those simpler "Little House on the Prairie" times, we have a sophisticated economy, and the organization of our economic and personal lives is much more complex than it was even 50 years ago.
So much so that even the successful "bottle bill," which was a landmark legislation hailed all over the world, now needs updating to reflect the contemporary situation.
In a democracy, working on the "bottle bill" and a whole bunch of other issues requires qualified people in all the branches of our government. However, we can't expect, nor require, the legislators, judges or the governor to essentially do this on their time and money, which is what, in effect, low compensation levels imply.
Yes, we need to fix inefficiencies in our government, but the solutions for leaner and more productive government will not automatically happen as a result of low salaries. In fact, it will require higher salaries to attract talented people who can then work toward this important goal.
If compensation is the overriding issue, then perhaps we should watch out for loony proposals to outsource our government (including the governor and legislators) to India, where a few thousand well-qualified Indians will be willing to work for Oregon's minimum wage!
Obviously, higher salaries do not guarantee a better government. We only need to look across at the business world, which is filled with examples such as Enron, whose leaders were highly compensated but failed miserably. But, unlike in the corporate world, we people have the ultimate power after all — the votes to elect or not re-elect officials.
Finally, let us also remember two golden rules. One, the warning that, in a democracy, we get the government we deserve. And second, the marketplace axiom that we get what we pay for.
An outcome when these two rules work together can be disastrous for good government in the 21st century.

Paulson a la Nixon, says Samuelson

Paulson's plan would not be the largest government intervention in the private economy since World War II. That distinction still belongs to Richard Nixon's imposition of wage and price controls in August 1971. True, Paulson would socialize unprecedented amounts of private debt, but Nixon asserted control over the entire economy. What's fascinating are the possible parallels between the two episodes, starting with a shared irony: Both came from administrations committed to "free markets."

Robert Samuelson offers an interesting observation, as always. He adds:

The rescue is being constructed so hastily that it may include all manner of flawed provisions: too much power for the Treasury secretary; authority for bankruptcy judges to modify mortgages. Congress faces a wrenching dilemma, imposed on it by financial markets and Paulson. If it dawdles, it may invite the panic that Paulson has brazenly predicted. But if it acts quickly, it may create a monster whose full implications emerge only with time.

Teeth: American white v. British yellow

But what is it about the bright white and perfectly straight teeth of Los Angeles that Americans love - and expect of their public figures?
"Americans have the idea uniformity is equivalent to looking good. The British character is more free-spirited, more radical," says Professor Liz Kay, dean of the Peninsula Dental School in Exeter and Plymouth.
She says Americans aspire to a row of teeth which are absolutely even and white. BBC News

Maria Bartiromo discusses the treasury bailout

With Stephen Colbert :-)

Scholarship and tenure in academe

While tenure allows established scholars to navigate uncharted waters and cross disciplinary boundaries, young scholars still feel that they pay a price for working on the edge of their disciplines. Faculty must obtain tenure in order to gain the freedom to pursue innovative research, yet ironically, the process of acquiring tenure may constrain talented scholars to normative modes of scholarship and pursuits within established paradigms. If the essential value of tenure lies in providing a secure environment for the development of new knowledge and innovation, then our review processes must adapt to changes in scholarship.

Amen! Looks like today I am merely saying amen to posts!!! Read Sylvia Hurtado's essay, and other related essays, in the latest issue of Academe--which is from the AAUP.
Tenure is wonderful, and ought to be protected. But, the process for review for tenure and post-tenure are horribly outmoded. It is way past time for an overhaul.

Life, death, humor, and god

The more we reflect on the pleasures of life, the more we miss the greatest consolation that used to be provided by religious belief: the promise that our lives will continue after death, and that in the afterlife we will meet the people we have loved. As religious belief weakens, more and more of us know that after death there is nothing. This is the thing that makes cowards of us all. ...
Living without God isn't easy. But its very difficulty offers one other consolation—that there is a certain honor, or perhaps just a grim satisfaction, in facing up to our condition without despair and without wishful thinking—with good humor, but without God.

That was the physicist and Nobel Laureate, Steven Weinberg, in the NY Review of Books. Would it be incongruent if I were to say "amen" to this? :-)

Growing instability in Pakistan

Pakistan leaders must act decisively after deadly Marriott bombing, analysts say
If the country doesn't crack down harder on Islamic radicals, analysts suggest, Pakistan could crumble into chaos. LA Times The following is my commentary published in the Register Guard today:

On Aug. 12 a year ago, I wrote that an unstable Pakistan has the potential to cause geopolitical crises beyond our wildest imagination. I wondered whether it would be better if Pervez Musharraf continued as the president of Pakistan, even though he had come to power through a military coup.
Ding, dong, the witch is dead. Musharraf stepped down when the parliamentary majority initiated impeachment proceedings.
Having followed Pakistani politics from a distance ever since I could read a newspaper, I suspected that this would trigger more instability and chaos. While recent developments indicate that I might be correct, being right in this case is, unfortunately, no cause for celebration.
Soon after Musharraf’s exit, the ruling coalition came unglued. The opposition was held together by the focused and singular objective of getting rid of Musharraf. That unifying force no longer exists.
Leading one faction is Nawaz Sharif, whose elected government was the one that was ousted by Musharraf in a military coup in 1999. The other faction is led by Asif Ali Zardari, who inherited the mantle of leadership after his wife, the late Benazir Bhutto, was assassinated. These two leaders and their parties formed the majority in the parliament. But when Zardari became a nominee for president, Sharif took his party out of the coalition.
Zardari won the elections and is the president now. But he may not be well; Britain’s Financial Times reported that he apparently “was diagnosed with a range of serious illnesses including dementia, major depressive disorder and post-traumatic stress disorder.” Who would want this person to be in charge of Pakistan’s nuclear arsenal?
To make things worse, U.S. forces stationed in Afghanistan apparently had President Bush’s approval to go after the Taliban and al-Qaeda in Pakistan — without prior permission from Pakistan’s government. Pakistan’s government, military and media are furious at the unilateral U.S. moves, which seem to undermine the country’s sovereignty.
It was therefore no real surprise when Pakistani military forces recently fired shots to repel American helicopter and ground forces. The only good news here is that the shots were fired in the air as warning. But Pakistani military officials are clear about what could happen: “In case it happens again in this form, that there is a very significant detection, which is very definite, no ambiguity, across the border, on ground or in the air: open fire.”
Meanwhile, al-Qaeda sympathizers and other militant fundamentalists have seized upon the political confusion as an chance to remind everybody of the havoc they can unleash. Take the horrific truck-bomb explosion at the Marriott hotel in Islamabad — just a few hundred yards from the prime minister’s house, where government leaders were dining after the president’s parliamentary address. I shudder to think what might have happened if the truck bombing had happened at the prime minister’s house.
The world has gained nothing from Musharraf’s exit. In addition to triggering geopolitical complications, Musharraf is now completely off the hook and is not bound to answer the question that has dogged us for seven years: “Where’s Osama bin Laden?” Musharraf is the one person who the world suspects has an idea of the whereabouts of bin Laden and his deputies.
Second, with his exit, Musharraf does not have to clarify to anybody how much he was involved in nuclear proliferation.
Recently, in the German publication Spiegel, the wife of the man called the “father of
Pakistan’s nuclear bomb” claimed that Musharraf and his military minions orchestrated the spreading of nuclear know-how to other countries, including
Libya and North Korea. Alas, we will never find out what Musharraf knew and when
he knew it.
It just boggles my mind that the entire world has stood by practically waiting for such events to unfold.
It is more than a mad, mad, mad, mad world.

Bailout is a "financial coup d'etat"

Earlier I blogged about the economic martial law that is now governing us. Well,:

[Here] is the truly offensive section of an overreaching piece of legislation:
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
This puts the Treasury's actions beyond the rule of law. This is a financial coup d'etat, with the only limitation the $700 billion balance sheet figure. The measure already gives the Treasury the authority not simply to buy dud mortgage paper but other assets as it deems fit. There is no accountability beyond a report (contents undefined) to Congress three months into the program and semiannually thereafter. The Treasury could via incompetence or venality grossly overpay for assets and advisory services, and fail to exclude consultants with conflicts of interest, and there would be no recourse. Given the truly appalling track record of this Administration in its outsourcing, this is not an idle worry.
Nouriel Roubini does not think it passes the smell test:
`He's asking for a huge amount of power,'' said Nouriel Roubini, an economist at New York University. ``He's saying, `Trust me, I'm going to do it right if you give me absolute control.' This is not a monarchy.''

From Naked Capitalism, via Greg Mankiw. Mankiw also points to this one from Luigi Zingales:

The decisions that will be made this weekend matter not just to the prospects of the U.S. economy in the year to come; they will shape the type of capitalism we will live in for the next fifty years. Do we want to live in a system where profits are private, but losses are socialized? Where taxpayer money is used to prop up failed firms? Or do we want to live in a system where people are held responsible for their decisions, where imprudent behavior is penalized and prudent behavior rewarded?

Recession and unemployment

When your neighbor loses his job, it is a downturn in the economy. It is a recession when you lose your job, and a depression when an economist loses his job. That is a standard joke in economics on how these terms are used. It is a joke that quickly highlights the rather arbitrariness when it comes to how these terms are used.

It certainly is looking and feeling more and more like a nasty recession. Of course, economists are yet to lose their jobs in huge numbers, which means the current economic situation is far from being a depression.

From the Economist:

America’s jobless rate hit 6.1% in August, up from 4.7% a year earlier, and within spitting distance of its peak of 6.3% during the previous recession after the dotcom bust. ..... A rise in unemployment is a good signal that growth has fallen below potential. Better still, it matches the definition of recession that ordinary people use. During the past half-century, whenever America’s unemployment rate has risen by half a percentage point or more the NBER has later (often much later) declared it a recession. ...