Taxes not for Vodafone.

The Supreme Court in India has ruled that Vodafone need not a paisa tax on its purchase of mobile phone operator Hutchison Essar in 2007 for $11 billion. Vodafone argued that the transaction took place between a Cayman Islands based company and Hutchison Whampoa of Hong Kong and was therefore outside the jurisdiction of India. The seller, that is Hutchison should have paid tax on its profits but as usual Indian tax authorities were sleeping. When they woke up they asked Vodafone to pay $2.2 billion in taxes plus added penalties for not withholding the amount as per Indian laws. As is its habit Vodafone refused to pay and now the Supreme court has backed it. Why? If the Indian law says that tax has to be withheld by the buyer then surely the onus is on Vodafone to pay and not knowing the law is no defence, as we are told repeatedly. It is like arguing that if an Indian living in Cayman Islands sells a house in UK to another Indian living in Hong Kong for a huge profit he is not liable for tax because the transaction took place outside UK. That is patently rubbish. Since the asset was in India the tax will accrue here. However, Indian tax fellows need not feel foolish. Vodafone is a master of evading taxes. In 1999 it bought a 45% stake in Verizon Wireless, a mobile operator in the US by borrowing $12.6 billion from the Swiss branch of Vodafone Holdings based in Luxembourg. Later the borrowing was increased to $27 billion on which Vodafone paid interest of $2.5 billion at 9% when interest rates were much lower. They paid just 1% tax according to Swiss laws and nothing in Luxembourg. Again in 2001 Vodafone bought Mannesmann, a German engineering firm for 180 billion pounds, through its subsidiary in Luxembourg, on which the tax should have been 6 billion pounds. Private Eye, January 10. After prolonged negotiation Dave Hartnett, chief of HM Revenue and Customs accepted a lump sum of 800,000 pounds and another 450,000 pounds to be paid over 5 years. At a time when citizens are being taxed on everything from diapers to funerals it is unacceptable that foreigners should make wealth here without paying taxes. With such massive sums at stake it is not impossible that some under-the-table handshakes took place. This money would go into the property market but that is another story. India is so so interesting, no.

What is brewing in Pakistan?

Pakistan is the world's largest producer of conspiracies by far. However there has been a curious lack of any effort about recent events in that country which is worrying since it is just across the border from India. Prime Minister Yousuf Raza Gilani has decided to take on all comers. First he criticised the fearsome duo of army chief Kayani and ISI chief Pasha for asking the Supreme Court to investigate,what is known as, the memogate affair without taking permission from the civilian government. Who has ever heard of the Pakistan army chief taking permission from anyone? Except of the US. That Kayani and Pasha did not suffer heart attacks due to excessive mirth was because Gilani then poked them severely in their eyes by sacking retd Lt Gen Khalid Naeem Lodhi as Defence Secretary. Gilani irked the Supreme Court for not investigating President Zardari's corrupt activities. That is stupid. No one investigates his boss for corruption and, to be fair to Gilani, if he started investigating the famed Mr 10% he would be doing it forever. So he was called to answer charges of contempt of court. He politely told the court that the President had immunity from any charge and the court had to back down. So whence this surfeit of courage? This is after all the country where ZA Bhutto was hanged, Zia ul Haq was blown up in flight and Benazir Bhutto was bombed or shot depending on who you talk to. Several possibilities spring to mind. It is possible that the US has promised him great riches for weakening the army so as to force them to take on the Haqqanis of the Quetta Shura, not memogate Haqqani who is hiding in Gilani's basement. It is also possible that Osama is still hiding in Pakistan, having fooled the US Navy Seals with a body double, and has promised Gilani the throne of Afghanistan once US forces leave. Or maybe the Chinese have promised him the governor's post in Xinjiang if he can help them wipe out the pesky Uighurs. Whatever it is we have got to know. A Pakistan without conspiracies is deeply worrying and not good for the safety of India. Will our government wake up?

Beyond comprehension.

The last few days have been full of news about the stricken cruise ship, the Costa Concordia. She is lying on her side on a rock not 50 yards from the shore. About 25 people may have died in the accident. Strangely all the attention is focused on the captain, whether he is responsible for veering off course and his conversation with port officials who are heard ordering him to get back on ship and help in the rescue effort. The actual rescue effort seems curiously low key. Divers complain about dark congested spaces with debris floating around. All activity ceases at dark and if the ship is felt to shift towards deeper water. Diesel powered generators are easily available and several could have been hooked up to provide light throughout night. Steel cables could have been attached to the ship from land and an attempt to winch her higher could have been made. It would not be easy and there would be danger of the ship breaking up. Perhaps it is cheaper to pay compensation for 25 dead people than the insurance bill for a ship of that size. Here in India the army chief Gen VK Singh has sued the government in the Supreme Court. His grouse is that the army records show his birth in 1950 while he says that he was born in 1951. If the date is amended his retirement will be postponed by one year which the government is reluctant to accept. The puzzling thing is that he kept completely silent when his seniority was calculated based on 1950 but he wants his retirement to be calculated based on 1951. Why did he not speak out when he was promoted to army chief? He says that it is about " honor and integrity " but it stinks of greed and opportunism. Businessman called Alistair Pereira has been sentenced to a ludicrous 3 years in prison for killing 7 people sleeping on a pavement on November 12, 2006. The Maharashtra government made no attempt to get the courts to increase his sentence. TOI, January 17. He surrendered at Sewri court to begin his prison sentence but was sent home because the Supreme Court order cancelling his bail had not arrived. Sent HOME! After killing 7. Is it any wonder that people all over the world have had enough? Time for the 4 horsemen?

Where is the money?

According to the International Food Policy Research Institute 21% of Indians are undernourished, 44% of children under 5 years are underweight and 7% of them will die before reaching the age of 5 years. TOI, January 16. Infant mortality rate in rural India is 55 per 1000 live births, 1.3 million children die before their first birthday and 1.6 million before reaching 5 years. We have heard all this before and nothing is going to improve unless poor people stop breeding. Is it better to survive childhood only to be sent to work at the age of 7 or 8 at low wages, starved, beaten up, sexually assaulted, living a filthy miserable life until an early death from alcohol addiction or a treatable infectious disease? What is even more shameful is that 55000 women die of childbirth every year in India. Pregnancy can only happen in young women and is not a disease. So these young, otherwise healthy women are dying of a natural physiological event showing a complete lack of healthcare infrastructure. So what is the government going to do about it? The Congress has decided to pass a Food Security Bill aiming to provide cheap food to 70% of the population, some 800 million people. Because Ms Gandhi wants it. There is no discussion about what it will cost, what it will do to the fiscal deficit which is already out of control, the falling rupee and inflation. If monsoons fail will the government buy food grains from abroad? Last year our balance of payment was $150 billion in the red and our foreign reserves are below $300 billion. Politicians keep talking about China but they are willfully blind to the most important lesson to be learnt from that country which is that its economy really exploded when the one-child policy was adopted and majority of Chinese now support that policy. However it is not only the Indian politicians who are blind. The Economist has found that according to its Big Mac index the rupee is undervalued by 61%. The Big Mac costs $4.20 in the US while the Maharaja Mac in India costs Rs 84, just $1.62. The Maharaja Mac is half the size it was 2 years ago. To make its index truly representative The Economist should also take into account its size and the weight of its contents, especially the meat. Is there a conspiracy to fool Indians with false information and induce a sense of complacency to help Congress? Love conspiracies.

The biggest danger facing India today is the useless education system. In a test called the Programme for International Students Assessment ( PISA ) conducted by the Organisation for Economic Cooperation and Development ( OECD ) every year to examine reading, math and science abilities in 15 year olds Indian students came second last out of 73 countries. TOI, January 16. Shanghai came first. The Indian government put up students from Himachal and Tamil Nadu which are supposed to have the best education systems but they were able to finish just above Kyrgyzstan. Seems that an Indian of eighth grade has the math ability of a South Korean of the third grade and the reading skills of a second grader from Shanghai. The report said," In Himachal Pradesh, 11% of students are estimated to have a proficiency in reading literacy that is at or above the baseline level to participate effectively and productively in life. It follows that 89% of students in Himachal Pradesh are estimated to be below that baseline." Following on from there the Chairman of the National Assessment and Accreditation Council, G Mehta has said that only 10% of graduates are employable. " We need out-of-the-box thinking to tackle the issue, considering that barely 10% of the 30 lakh ( 3 million ) students, who pass with these degrees every year, are considered employable" he said. He was referring to BA, BSc and BCom degrees. So what has the government been doing to increase standards. It has increased reservation seats in elite institutions and is insisting on reservation even among faculty. So we can have 5% teachers teaching 5% students. It has established 7 new IITs which are without infrastructure. Students of the new IIT of Kota are sharing facilities in Kanpur doubling class sizes. There are 2000 vacancies among faculty in IITs. Salaries of IIT faculty have not been increased but government school teachers, who are poorly educated and rarely come to work, have seen their salaries jump 80% in the Sixth Pay Commission. A new short course medical graduation for village doctors is being set up. Who is to prevent them practising in cities? Seems that the Congress is hell bent on dumbing down education in India so that we will have a very small number of elite students with the majority with degrees but practically illiterate. The Congress loves the aam aadmi.

Ignorance is scary.

On August 5 last year Standards and Poor's reduced the credit rating on US sovereign debt to AA+ from AAA which is the highest rating. The US government found a $2 trillion dollar mistake in S&P's calculations and its chairman, Deven Sharma was made to resign within 2 weeks of the downgrade. On August 8, the first trading day after the downgrade yields of US 10 year bonds were at 2.40, today they have dropped to 1.89 as investors have sought safety in the dollar because of uncertainties elsewhere, especially in the Eurozone. Last week S&P downgraded 10 countries, including France, using the Euro. Portugal and Greece were at junk status anyway. Germany, Finland, Luxembourg and Netherlands were left at AAA while Belgium and Estonia were left unchanged at AA and AA- respectively. All the countries except Germany and Slovakia, which is at A, have been put on negative outlook. The other 2 ratings agencies, Moody's and Fitch have remained unmoved. It would seem that S&P is right in its pessimism. Greece was unable to persuade private investors to take a 50% haircut on its debt which is the condition for the release of the next tranche of its bailout money. Experts predict a 99% chance that Greece will default on its debt. Some say that European politicians have already accepted that Greece will default and leave the Euro and are trying desperately to make it an orderly affair so as not to cause chaos in the markets. Some say that there is no provision in the Maastricht treaty for any country to leave the Euro so the currency will have to be abandoned. Italy, which has seen its rating downgraded 2 notches from A to BBB+, will need to redeem $193 billion worth of debt this year with $31 billion coming up in February. All this should have created panic in the markets but all seems calm. Italy's 10 bond yields have dropped to 6.634% while that of Spain has dropped to 5.103 from 5.323%. Germany actually sold 6 month bonds at negative yields. Normally bonds are sold at slightly less than their face value. When they are redeemed investors are paid the full value, the difference being their profit. Last week investors paid 100.00616 on bonds with a face value of 100 which means they are paying Germany for the privilege of buying the bonds. Why? Why are they deliberately booking a loss? Surely holding cash would have at least been more profitable. Are they using their Euros expecting to be paid back in Deutschmarks? It is like Jurassic Park. Where will the T Rex appear from. Terrifying yet fascinating.

Men are mr, women are ms.

Mehsana town in Gujarat has 760 girls for every 100 boys, the worst gender ratio in India. TOI, January 13. Girls are being aborted before birth. The reason is not, as feminists would have us believe, that men are averse to daughters but the preference for boys among women. A visit to any residential area in India will show how spoilt and ill behaved the boys are compared to girls. The fact is that women do not like women. The population of the US is 53% female so one would have expected Hilary Clinton to waltz into the White House. Did not happen. Can you imagine an all-woman army, led by a Julia Caesar, crossing the Rubicon on her command? They would argue, criticise her judgement, her lack of hair, her tendency to have fits, her lack of breasts, her big bottom and so on forever and the Rubicon would remain uncrossed. Indian men are the most useless in the world. They cannot cook, iron, stitch a button, change a bulb or change sheets on their beds. One lady dentist in Knowsley in England used to put her 8 year old son to bed with a bottle of milk. To help him sleep. Fact. Unless women face the truth girls will continue to be killed. Maybe it will help reduce the population. No incubator, no chicken. Meanwhile Jennifer Lopez used to pay $10000 to her 24 year old toy boy, Caspar Smart. No harm in that. Men have been paying mistresses for centuries. What is the male for mistress anyway? Is it mister? Does that make all of us men, what the Indian press coyly calls, paramours? Ms Lopez wanted the appropriately named Mr Smart to take her on surprise trips and buy presents for her children. How yuck is that? No harm is whizzing off for a dirty weekend to Coney Island but men would strictly separate paramours from family. Some pleasures are not for sharing. Therein lies the difference. Men like women and women do not. Indian women are besotted with gold and boys. Maybe it is in the genes. No law, however stringent is likely to change the ratio. To change, women have to accept that they have a problem. But will any woman?

A police state.

When union minister Kapil Sibal tried to force internet sites such as Google and Facebook to censor any criticism of Mrs Sonia Gandhi there was an uproar forcing Congress to retract. Of course, he tried to camouflage his intentions by saying he wanted to remove any abuse regarding religion, race or personal attacks on individuals. If people thought that they had been able to defend their freedom of speech they were wrong. One Vinod Rai has filed a petition in court asking for all objectionable contents to be removed. A judge at Delhi High Court has asked social networking sites to find and remove all objectionable material from their sites or else the sites will be blocked " as in China ". TOI, January 14. Politicians want to have absolute power so as not to have to answer to any questions about corruption so they would like to limit our freedom of speech. So we need the judiciary to protect our basic fundamental rights. The extreme right wing government in Hungary has just changed the constitution limiting press freedom. Earlier South Africa has passed similar laws which has prompted some to say that the country was returning to the apartheid era. In Russia since 1993 around 300 journalists have been killed or are missing. Anna Politkovsaya was shot in front of her apartment door. Iran shut down social networks during the vicious crackdown on protesters after the stolen elections of 2009. Mubarak shut down these sites during the protests in Egypt in January and Assad is trying to do the same in Syria. In every parameter of economic development China is 100 years ahead of India. It has 3 trillion dollars in reserve, fantastic roads, no shortage of electricity, better education, better research facilities and enormous military superiority. They thrashed us in 1991 and are still occupying some 50000 square miles of Indian territory in Kashmir and the north east. We in India had at least one bragging right and that was that our press is relatively free though most journalists, being freeloaders, will defend the crimes of politicians. But even this limited freedom is too much for Congress. A recent front page ad in The Hindu had a full page picture of Mrs Sonia Gandhi with the words " We remain, Madamji, ever at your feet ". This was paid for by a businessman, H Vasanthakumar. A party of spineless creepy crawlies, the Congress would love a dictatorship of the Gandhi family so that they could loot forever. The slippery slope to North Korea.

Crooks and their stooges.

A prestigious consulting based in Singapore has rated Indian bureaucrats the worst in Asia with a score of 9.21 out of 10. Worse than Vietnam at 8.54, Indonesia at 8.37, Philippines at 7.57 and China at a distant 7.11. Cheers all round. According to this report Indian civil servants are uniformly corrupt, have so much power that they cannot be punished and are protected by the almost frozen judiciary. The only reason that they did not make a perfect 10 is probably because a rare one out of 1000 does some work. This is not a surprise to any Indian or foreigner who has visited India. What is surprising is the number of people who are ready to defend these scum. A fellow, who described himself as a social worker, writing in an English daily said that we should not have strong laws against corruption because that will prevent honest civil servants from carrying out their duties in case of false accusations of corruption. There are tens of millions of civil servants at the center, at state governments, municipalities and other bodies so there is a vast army of scavengers living on crumbs falling from the trough. One common refrain is that lower grades such as C and D should not come under the proposed ombudsman. A sub-auditor in Indore, Anand Pathak has been found to possess Rs 100 million worth of assets including 2 plots, 3 buildings and shops. A lower division clerk ( the lowest creature ) at Ujjain Municipal Corporation has assets worth Rs 80 million including 2 houses, 2 shops 2 JCB machines, 1 dumper and a Tata Safari. An example of the principle of diversification of assets. The CBI caught a Junior Telephone Engineer in Indore, SN Mishra red handed accepting a bribe of Rs 20000. E Sreedharan has just retired as head of Delhi Metro. He offered to resign when a bridge under construction collapsed killing 7 people. His resignation was rejected. However, when a footbridge collapsed just before the Commonwealth Games everyone blamed the Delhi government for stealing vast sums. The reason why civil servants are so afraid of " false " accusations is because the allegations are true. We can recognise and forgive an honest mistake from someone who is trying his best. It is the crooks that we want to be put away forever. The scary thing is that the economy is running on black money and may collapse if that disappears. When you are used to luxury from crime you will do anything to protect the source. That is the talisman protecting the scum.

The plot thickens.

An Iranian scientist on his way to work was killed by a magnetic bomb attached to the top of his car by a motorcyclist who then escaped. The Iranian currency, the Rial has fallen over 10% in the last one week because of US sanctions on the central bank of Iran. Already over 20% inflation is likely to go higher with the fall in the currency. Japan is thinking of reducing oil imports from Iran and the EU may follow. That is probably why it was so important to finish the war in Libya quickly so that it could resume its oil exports to fill up the gap so that international prices remain steady and cause no economic panic. The Assad regime in Syria, which is Alawite, is under serious pressure and its fall will usher in a Sunni government which would be extremely hostile to Iran. This would cut off supplies of weapons to Hezbollah and Hamas weakening them. So is a regime change in Iran imminent? Iran is backing Assad to tough it out in face of mounting protests. In 2009 protests in Iran were subdued by the sheer brutality of the regime's response and Iran is hoping that the same will happen in Syria. However, Iranians are almost all Shia whereas Sunnnis form an overwhelming majority in Syria and the hatred is such that they may be willing to sacrifice any number of lives to victory. So far so bad. But Iran has another ally next door. Iraq's Prime Minister, Al Maliki, a Shia has been consolidating power. He had an arrest warrant issued for Tareq Al Hashemi, the Vice President who had to flee north to a sanctuary in the Kurdish territory with the help of the President Talabani, who is a Kurd. Shias are 60% of the population, mostly living in the south. Iran could sell oil through its friends in Iraq. If things get really tough Iran could mount raids into Saudi Arabia which shares a very long border with the south of Iraq. Although the oil region of Dhahran is much further to the south Iran could still cause enormous confusion by sending in small raiding parties without actually declaring war. During its war with Iraq Iran almost won by the sheer fanaticism of its soldiers who were ready to embrace martyrdom with pleasure. Such ferocity is almost impossible to defend against. Would the US attack Iran to defend Saudi Arabia? Would we see a coalition of Saudi Arabia, Israel and the US fighting Iran? How would other Muslim countries like Pakistan respond? Meanwhile is there going to be another coup in Pakistan? What a fantastic thriller! Let it role.

Misuse of an icon.

One of the biggest weapons used by the Congress against the people to perpetuate its grip on power is the memory of the father of the nation, MK Gandhi. Hindus are regularly persecuted because Gandhi loved minorities. The Lok Pal bill was torpedoed by demands for reservation for Muslims and now the Congress is promising 9% reservation for Muslims in a cynical bid to win the coming assembly elections in UP knowing that there is no provision for reservation for minorities in the Constitution. This is the same Congress whose MPs were shouting from the rooftops about the sanctity of the Constitution when we were demanding a strong Lok Pal. Congress stooges in the press are no less guilty. One fellow, who is supposedly an eminent historian, wrote in an article that Anna Hazare is no Gandhi and is therefore not qualified to lead civil society activists asking for a strong Lok Pal. Of course, he is not. He has repeatedly said that he is a follower of Gandhi. But that does not mean he would behave exactly as Gandhi did. It is like saying no one can be a Christian unless he is crucified and then resurrects. Gandhi lived in a different India. His fight was against British occupation and in some ways infinitely easier than Hazare's fight against today's criminal monsters. The British looked different and apart from a few minorities ( to name them would invite punishment for hate speech ) Gandhi had absolute support from the people. Wherever he went he stayed as a guest of rich people such as the Birlas which prompted the comment from Nehru's sister, Sarojini Naidu that it cost a lot of money to keep him in poverty. Hazare, on the other hand, has no rich backers and lives a spartan life in a village in Maharashtra. As a citizen of India he has every right to demand an end to corruption and is following Gandhi's example of civil disobedience. Gandhi was treated with courtesy by the British while the Congress and its hounds want to tear Hazare apart. Just as fanatics use God as an excuse to kill the Congress is using Gandhi to oppress Indians. A vile attempt to maintain status quo. Power and pelf.

One legged progress.

There is no doubt that India has progressed a lot. From a backward country on bullock carts we are moving, tentatively, towards cars and planes just when global warming and peak oil are threatening to send the world backwards. Most of the changes have come in the last 10-15 years or so. When we first moved to Vasant Kunj in Delhi in 1990 the car parks were largely empty. Most people had scooters and some were proud owners of an old model Fiat or a the smallest Maruti called the 800. Now the same families own at least 2, if not 3 cars, each and there is hardly any place to park. In 1990 it would take an average of 3 years to get a new telephone connection, today it takes a few hours, the time taken to buy a cell phone and get a new sim card activated. It used to take a few hours to cash a check at any bank as the check traveled from one desk to another while the signature was verified and the balance checked to see if there were sufficient funds. Today it takes a few minutes. I could not have imagined back then that I would be able to access broadband sitting at home with a thingy that looks like a pen drive. But this is very little of what could be achieved. We could have achieved at least double of what we have if were not held back. It is like trying to run fast on one leg, the other being held back by corruption. Criminal politicians and thieving civil servants are shackles round our legs. In today's HT a report says that our Foreign Minister traveled to Malaysia last year with presents which were fakes and hugely over priced. A Nakkishi bowl should be 92.5% silver and cost Rs 14315. Instead the one taken was just 64% silver and cost Rs 40000. A silver bowl was 80% silver instead of 95% and cost Rs 7000 instead of Rs 3000. Instead of sourcing the gifts from official state emporium they were bought from a private supplier, naturally for bribes. Why should other governments trust us when we go around distributing fake gifts? The second, much larger, corruption is using taxpayer money as bribes to win elections. Multitudes of social schemes which are looted resulting in increasing deficit, inflation, devaluation of the rupee and extortionate taxes choking growth. If only we had just a few decent people with the character to say " NO ".

It is easy.

In today's HT a minister, Sachin Pilot writes about eradicating malnutrition in India. It is a usual mixture of pity for the poor, a pious resolve to reach and educate the poor and a plea for more aid channeled through official channels and NGOs. As usual Mr Pilot fails to answer the most important question, which is how many people he thinks the country can feed and for how long. Does India have the land for growing food, the required infrastructure or the money to feed an infinite number of people infinitely? Can any country? We are assaulted daily in the media by shrill do-gooders who insist that the poor must be given food, places to live, healthcare, education and every comfort society can afford. After all the poor are also human and deserve to be treated with dignity. No argument there but surely human beings are capable of analytical thinking, of distinguishing right from wrong and at least some duty and loyalty towards their country. We should treat the poor with respect and sympathy but do they not have any responsibility towards improving their own situation? At the very least they should not have any children. It is totally unacceptable to produce half a dozen children and then expect the government and civil society to care for them. The poor breed because they want to send their children out to work which allows the parents to take it easy. Destruction of forests, poaching of endangered animals, forcing children into work even crime is justified in the name of poverty. Survival means no rules apply. Mr Pilot may be sincere in his sympathy for the poor but to talk about reducing malnutrition without reducing population is sheer humbug. If we want to be cynical we can say that as an Indian politician it is in his interest to advocate social schemes because those can be easily looted by politicians. If he really wants to make a difference educate and help the poor not to breed. That is where taxpayer money should be spent. If there are no poor there will be no poverty.

Election entertainment.

If I had a million dollars I would gladly give that to be in the US from now till presidential elections in November. Americans surely have the most entertaining elections in the world. From the mildly weird to the seriously wacko you get all kinds of candidates and even the weirdest has some supporters who will turn out with music and badges and fliers. The Republicans see a real chance in making Obama a one term president and are holding primaries to select their candidate. This gives Obama a financial advantage in that he does not have to spend any money until the Republican challenger is known. The Republicans have gone with men whose names have 4 letters. There is Mitt, a Rick, another Rick, Newt and Paul. Cain had to drop out after several women alleged that he was able. Michele is out after receiving just 5% of votes in Ohio. Not because she said some strange things like HPV vaccine making women mental, in which case Ron Paul should not come third with 21.4% because he seems to be mental without HPV. Michele should have been aware that uterus is known as hysterus and so women were said to be hysterical. That is so last century. The race now moves on to New Hampshire where a Jon Huntsman is lurking with intent. To be in the US to see all the excitement, razzmatazz and debates would be the ultimate entertainment. Here in India elections are boring with the same old men, podgy women and family members. Political parties are gangs controlled by families, each with its territory. Candidates are selected by gang bosses and inflicted on the people who have the painful duty of selecting between a bunch of ugly criminals. Of all the bosses the Capo is the most powerful. In UP 2 fellows were thrown out by the ruling BSP for corruption and the BJP immediately embraced them even offering them constituencies to contest until an outcry in the press forced them to do an about turn. This is the party which was most vocal about the need for a strong Lokpal. For Congress Sukh Ram is still avoiding prison by pretending to be unconscious in hospital. Mubarak already did that in Egypt. You would think that judges would see through such sham but no one dares to mess with the Congress. If only it as not so boring. Suicidal.

Method in confusion.

An apology would seem to be called for. We had assumed that ministers and officials were trying to imitate demented parrots when they continued to harp endlessly on a growth rate of 8% but it appears there was reason for their echolalia. It appears that the services sector comprises 57% of GDP, industry is 28% while agriculture makes up 15%. Services, led by IT, has been growing at over 10% which gives a " floor " GDP growth rate of 6%. Industry was growing at 8% giving a floor growth rate of 2% so even if agriculture remains flat we should expect a GDP growth of 8%. ET, January 4. Why both services and industry should continue to grow regardless of circumstances is not explained. Our economy is not export driven like the east Asian economies. Internal consumption accounts for over 80% of the economy and this would surely be sensitive to inflation. For households there are some expenses which are compulsory. Food, rent, travel costs, utilities, school fees, medical expenses and some social obligations like marriages must be paid for. When the cost of all these are rising, some by 50-100%, then people will cut back on what they see as non essential expenditure such as eating out, cinemas, travel, buying a new car and so on. These are taxpayers with legitimate income. There are vast numbers of people whose main earnings come from black money including politicians, civil servants,ration shop owners, property dealers, builders, shop keepers and others. These people are immune to inflation. The union government spends Rs 8.16 trillion on the salaries of 6 million employees. State governments and public sector companies employ another tens of millions. If only 5% of the population have black income that makes 60 million people who can spend regardless of prices. That is equal to the entire population of Great Britain. However, to depend on black money for growth seems stupid. This would explain why headline inflation remains at 9% in spite of 13 interest rate rises. A lot is being written about policy paralysis. When there are 80 ministers there can never be any decision. If the environment fellow wants reduction of greenhouse gases the minister of biogas will object. If minister of kabaddi wants to play a Sachin in his team the minister for cricket will object. Coalition dharma. With this government the only growth we can expect is that of deficit, poverty and corruption. Not at 8%, more like 800%.

Officially corrupt.

Karnataka has made it official. Until now civil servants were restricted from receiving any gift costing more than Rs 5000 in the case of officials in Groups A and B, Rs 2500 for officials in Group C and Rs 1250 for those at the bottom in group D. This was causing hardship so in a fit of kindness the state government has increased the quantum of gifts to the basic monthly salary of the recipient. Since salaries of these useless parasites were increased by 80% in the Sixth Pay Commission this makes a handsome New Year's present. Interestingly an officer can receive gifts from a friend if he has no official dealing with him. Since some of our brightest join the civil service because of the opportunity for enrichment it provides it will not take long for them to increase their list of " friends ". Officer A can accept a gift from his " friend " and pass it along under the table to Officer B who has official dealings with said " friend ". Best get all this sorted out before a Lokpal Bill is passed. In the UK Gary Dobson and David Norris have been found guilty of the murder of Stephen Lawrence after 18 years. This was possible because of 4 years of painstaking forensic work which could match Stephen's DNA to a microscopic drop of blood and a strand of hair on the clothes of the 2 killers. A public inquiry after the first trial, in which the men were found not guilty, severely criticised the Metropolitan Police accusing it of institutional racism. Since then wide ranging changes have been carried out in policing. At least UK has a functioning justice system. Here in India previous telecom minister Sukh Ram, who was caught red handed with Rs 30 million stuffed in his mattress in 1996, is still enjoying freedom. Over 80 he will probably die of old age before judges wake up. Ramalinga Raju, who confessed to robbing his company, Satyam without any duress, is out on bail. Sir Conrad Black is in prison for the same crime of robbing Hollinger International. Bernie Madoff confessed a couple of months before Raju and is already serving 150 year sentence. It is best not to say anything about our judges because they have made themselves divine. And how. They have acquired a lethal weapon called " contempt of court " in which they act as prosecutor, jury and judge. A news channel has been asked to pay Rs 1 billion to a retired judge for mistakenly showing his picture on TV for a few seconds even though they apologized for 6 days on their programs. All " friends ".

Leaders responsible.

People reflect the type of leaders they have. Indians lack a sense of humor, are disunited and have no respect for the law because that is what they learn from Indian politicians. Our politicians roam are around with Z plus security because they crave status knowing that they are despised. Motivated solely by self interest small local parties have paralysed parliament preventing the passage of any bill, however important for the nation. From loot to rape to murder politicians commit every heinous crime and are then protected by their parties. Soldiers returning from the Iraq war are unable to adjust to civilian life back home in the US. One 24 year old veteran, Benjamin Colton Barnes shot dead a ranger, Margaret Anderson at Rainier National Park. His girl friend said that he was irritated, depressed and moody and kept an arsenal of weapons at home. When abroad US citizens can commit any crime against locals and are then protected by their government. Raymond Davies and Amanda Knox walked free. Wikileaks video showed how a helicopter crew were laughing while hunting Iraqis, killing 2 Reuters correspondents in the process. When you are able to enjoy yourself killing locals, as in the massacre at Falujah, with no fear of punishment it must become a habit and the sudden restrictions of life back in the US is such a shock that veterans are unable to adjust. Calling it post traumatic shock provides a veneer of respectability but prevents diagnosis and treatment. In a court in Yibu in China S Balachandran, an Indian diplomat was so severely assaulted by locals that he had to be admitted to hospital. He was trying to secure release of 2 Indians who were being held hostage to secure payments. Couple of months back a captain of a Chinese fishing vessel killed a South Korean coast guard by stabbing him with a shard of glass. The Chinese government treats its citizens like trash. Anyone protesting injustice is threatened, beaten and jailed so there is an enormous anger waiting to explode. It is relatively safe to take your anger out on foreigners which makes Chinese an uncivilised nation of savages. You see the same in the middle east where foreigners are abused, workers treated worse than animals and maids raped. It is said that we deserve the government we have. In reality people have no power. Scum have taken over.

Inflation stops growth.

Inflation affects everyone in the country, the poor infinitely more than the rich. With finite earnings rising prices mean that people can buy less so they make choices. For the middle class it may mean postponing the purchase of a car or replacing the old fridge. For the poor it means having less meat or milk and doing without washing powder, a visit to the dentist or an essential blood test. Thus it affects the entire economy from automobiles to white goods to the FMCG sector. High interest rates, on the other hand, is good for those with less income because they get higher interests on their fixed deposits in banks which augments income and savings. However high interest rates are bad for builders, property dealers and land grabbers who make profits out of creating a bubble. Property prices have increased 800% since 2002 and have reached fairy tale levels. This is good for criminal politicians and thieving civil servants who have invested their black money in property which is why the government is so keen to see the RBI reduce interest rates. The constant chatter is about growth with ministers debating whether it will be 7.6 instead of 7.4%. With the rupee in free fall inflation will rise preventing the RBI from reducing rates so in a fit of panic the government has decided to invite hot money from abroad. First banks were freed to set interest rates on Non Resident External accounts. A few banks promptly set the rate at 9%. Second the government has now allowed Qualified Foreign Investors to buy shares in the Indian market directly. Foreign Institutional Investors have apparently lost Rs 2 trillion on Indian shares because the Sensex has fallen 24% in 2011. That,coupled with the fall of the rupee, has meant that FIIs have got fewer dollars on repatriation. So why should foreign investors, individual or otherwise, rush to invest in India when the future looks so foggy? Recent outcry over corruption and black money held abroad may have forced the issue. This would provide a nice channel for bringing the money home. In the process the Sensex and the rupee would stabilize. Problem is that general elections are in 2014 by which time things could really get really rough. Still the politicians would never call early elections. What if they lose? That will cut 2 years worth of loot. They seem to be like the monkey with its hand stuck inside a bottle, desperate to get its hand out yet too greedy to let go of the nut. Would it be stupid to enjoy?

Reasons for optimism.

So, 2011 is dead and we are already into 2012. In spite of pious hopes for happiness and prosperity the future looks extremely gloomy. Europe is certain to plunge into recession and there is a real chance that the Euro will break up. That will cause absolute chaos in financial markets. In India fiscal deficit and current account deficit are rising fast, non-food inflation remains uncontrolled and the rupee is plunging which will raise cost of commodities feeding into inflation. Already a Rs 2 increase in the price of petrol has been announced. So is there any cause for optimism. If the worst happens and the Euro breaks up the resulting financial meltdown will lead to protectionism as each country tightens control on trade. This will reign in the robber barons who have been moving money around the world, cutting jobs and awarding themselves ever increasing bonuses. Politicians, however craven, will be forced to tighten rules on how markets operate and punish financial scam artists. Prices of commodities and properties will fall bringing some respite to the poor. If growth in China falls precipitously there may be social unrest leading, hopefully, to civil war. In Shandong province in eastern China 24 people died from Viral Hemorrhagic Fever transmitted from rats. Fan Tiangli, an Infectious Diseases doctor, said that cases were from rural areas where people were in direct contact with rats or had food contaminated by rats. Or maybe they were eating rat salad. A 38 year old driver in Guangdong province died of bird flu. He did not have any contact with poultry and did not travel abroad so how he got H5N1 is not known. Previously the virus was thought to have infected civets before jumping to humans in China. Chinese habit of eating anything, however revolting, may lead to an even more lethal epidemic. Anything bad for China is good for India. In Pakistan the army is finding it difficult to maintain its absolute control. As the army weakens Islamists will become stronger. These fanatics have been trying to acquire a nuclear device for sometime and may feel bold enough to attack a nuclear silo leading to civil war. Relations with the US are declining and if a nuclear device is lost it may lead to open war with the US. Fall in commodity and property prices and war inside our enemies, now that is cause for optimism. Let us hope.

United in crime.

As expected the Lokpal Bill, even an anemic, emasculated one, failed to pass. In other countries opposition parties resort to filibuster to block any legislation they do not like but here, in India, there was great cooperation in endlessly discussing it to death. It was well planned. At first a vicious assault was launched on Anna Hazare and civil society activists by the pet Rottweilers in the press. Some were openly abusive accusing Hazare of being a dictator, a man unwilling to listen to reasonable suggestions from honorable politicians. Others tried to be clever. We support the campaign against corruption but parliament is supreme and one cannot dictate what laws to pass. Others suggested that Hazare should compromise. Why anyone should compromise with corruption was not explained. Still others did not like the tone of conversation, the methods adopted or the venue chosen for his fasts. The really slimy ones questioned the source of funds. When the fourth estate behaves like the fifth column liars triumph. The Congress would never allow control of the CBI to slip out of its grasp because that would remove its impunity from all the crimes it commits. On cue the BJP started an outcry for the inclusion of the CBI in the Lokpal's control seemingly forgetting how it used the agency to destroy Tehelka with a succession of false cases. State governments are many times more corrupt than the central one and to accept Lokyuktas would be suicide. Look what happened to Yeddyurappa. Unfortunately no one pointed out that Uttarakhand has instituted a Lokyukta exactly as demanded by Hazare and the governor of Gujarat appointed one by force to embarrass the Chief Minister, Modi. Could the government and the opposition be in cahoots? Surely such " honorable " people would not conspire against the country. We must remember that when it comes to increasing perks of MPs or allowing the use of such abominations like cars with sirens and red beacons the vote is invariably unanimous. To be such successful criminals politicians have to be extremely cunning. Also, did anyone ever hear of criminals creating a police force? It would be suicide and we have never heard of any politician committing suicide. Shades of bastards but united.

Inflation is not growth.

The sudden drop of food inflation to 1.4% has already ignited calls for the RBI to reduce interest rates to stimulate growth. However, the RBI would do well to reflect long and hard before deciding. Firstly, this figure is partly due to a very high base and secondly, food prices are highly seasonal. Present prices reflect an abundant kharif crop due to generous monsoon rains but come spring the effect will start to wear off unless there is adequate rainfall for the rabi crop. Grains can be stored though, if past experience is any guide, a lot of it will rot on open ground because of lack of storage silos. Vegetables are perishable and as the season wears on winter vegetables will gradually disappear and prices will start to rise again. Large amounts of edible oil and pulses have to be imported and politicians have a big role to play in their procurement and prices. A report by Comptroller and Accountant General blames the Consumer Affairs and Distribution Ministry ( what country in the world wastes money on such a idiocy ) for a loss of Rs 12 billion on import of pulses between 2006-2011. TOI, December 29. Seems that the ministry allowed private traders to take control of imported pulses through a skewed tender system which allowed a few traders to submit bids far less than market rates. Also the ministry continued to import yellow peas even though there was no demand for it. Total loss Rs 12.01 billion. We are not told how the profits were distributed. The only reason why the government is so desperate for growth is that tax collections will increase which will mitigate the disastrous effects of unrestricted wasteful expenditure. Instead of reducing expenses the government wants to pass a Food Security bill which will mandate cheap grains, pulses and oil to 70% of the population. Expenses will balloon, inflation will jump, fiscal deficit will rocket, the rupee will dive and we will suffer as the economy tanks. One would think that with the World Famous Economist in charge the economy would be on a sound footing but he knows that the Great Successor is waiting to take over and he is calculating that he will be gone when the shit hits the fan. That anyone can be so selfish, mean and unpatriotic is hard to imagine. Pathetic.

Best to have more criminals.

Kim Jong Il's funeral was a most astonishing spectacle. Ranks upon ranks of people,possibly up to a million, standing still in bitter cold while an old, bald headed fellow droned on about how great the dead man was, never mind that hundreds of thousands died of famine under his rule. A BBC analyst was brutally honest. South Koreans are physically bigger than the North Koreans and South Koreans throw away more food than North Koreans get to eat. Yet there they were, forced to honor a man who appeared to be a buffoon with a bouffant hair style partial to western music and cognac. Now they will have to bear plump 28 year old, Kim Jong Un who definitely needs to change his barber. This kind of hero worship is possible only in a one man dictatorship. Things are slightly better in oligarchies such as China and Iran where the system, whether communist or religious, is more important than any one man thus preventing concentration of power in one person. Anyone seen as an embarrassment or seeking to challenge the system is ruthlessly eliminated. The previous railway minister in China, who has been held responsible for the high speed train crash because of his corruption, has been removed and may be executed. However, democracy is the best because it provides opportunity to a greater number of people by diffusing corruption across society. The Occupy Wall Street movement in the US is against concentration of wealth in the hands of 1% of population. But, 1% of 300 million is 3 million which is a large number. In India 1% of 1.2 billion means 12 million people with money and power, which is a huge number. " Democracy " is composed of 2 Greek words - " Demos " which means common people and " Kratos " which means rule or strength. Yet, we the people are totally powerless against a combination of criminal politicians, thieving civil servants, conniving business people and an obedient press who tell us that we do not count because parliament is supreme. At least we are not forced to stand in the cold for hours and listen to a boring speeches. Many scoundrels are surely better than one.

Black money is here.

The government has tabled a Money Laundering Bill in parliament which seeks to attach property of criminals during the trial itself. The bill seeks to make Indian law compatible with laws of other countries. Very commendable except that most of the black money in India is generated by bribes taken by criminal politicians and thieving civil servants and from land grabbing where public land is sold off to friends or relatives of politicians and civil servants at throw away rates to be sold later at exorbitant prices to developers. Thus, most of money laundering is in property and the new bill is merely cosmetic cover up. Efforts have been made to rid the country of the pestilence of black money but not never with any serious intent. In the past a law allowed the government to buy any property at the declared rate and sell it at an auction to discover its true price. So if a person declared the sale value of a property at Rs X the government would pay that amount to the owner, take ownership of the property and auction it off. This only increased the rates of bribes taken by politicians and tax fellows and only people stupid enough not to pay a bribe lost their properties. Now a new wheeze called " circle rate " has been introduced in states such as Delhi. In this scheme Delhi is divided into circles of affluence, or lack thereof, and a rate is set by the government. This sets the floor rate for every property in a particular area and you have to pay stamp duty and registration tax on the rate set by the government even if you sell the property at a lower value. However the government can never set the rate so high that it approximates the true value of properties because no one will pay such high taxes and the property market will seize up altogether. Not good for the criminals. Thus our most revered Prime Minister declares an apartment in Vasant Kunj in Delhi at Rs 8.6 million while its market value is over Rs 20 million. By definition black money cannot be controlled by the RBI or the government and is the main reason why inflation cannot be controlled. To be serious about money laundering stamp duty should be lowered to 1% as in other countries. Anything else is just smoke.

A deficit of trust.

In a long article in today's Times of India, Union minister for law and justice, Salman Khurshid defends the chicanery of the government in completely perverting the Lokpal Bill. Supporting the government retaining its control of the CBI he says," But what about administrative control of the police, paramilitary forces, armed forces, RAW and IB, or the nuclear command? We can trust the government with all these, except in observing arm's length distance from the CBI?" Police are controlled by the state only in dictatorships but not in any country with genuine democracy. Would a Jeffery Archer, MP and Deputy Chairman of the Conservative Party, ever go to prison in India or a Spiro Agnew, Vice President to Richard Nixon be made to resign from his post for accepting a bribe? Sukhram is still enjoying freedom and not a single Congress fellow was jailed, let alone hanged, for the massacre of Sikhs following Indira Gandhi's death. The police should be free of political control so that no criminal politician's daughter can slap a policeman in Mumbai and not be jailed. Remember Bofors? The CBI should be under independent supervision so that we do not ever again spend a billion rupees on a farce. Mind you, the CBI fellows had a wonderful time jetting off to all the expensive tourist spots in the world including St Kitts without ever being in any danger of catching big Q. As for the paramilitary and armed forces, the intelligence agencies and nuclear command we have to accept government control which is not the same as trusting the unsavory fellows. We remember how over the years the government has surrendered to our enemies. We accepted Chinese control of Tibet and allowed the cockroach-eaters into the WTO with nothing in return. We refused a Security Council seat. We returned 90000 Pakistani soldiers for nothing. We helped create the LTTE who killed our soldiers. We created Bangladesh which is now the source of most terrorists. The hijacked Air India plane was allowed to leave Amritsar airport and fly off to Kandahar. The list is endless. We absolutely do not trust the government. That is why people of Kudankulum refuse to accept a nuclear power plant in spite of repeated assurances from the Honest Man. Face the truth.

It's the economy, stupid.

Just a few days after increasing India's sovereign rating to investment grade Moody's has suddenly woken up to the prospects of stagflation in the economy. While commending China for keeping growth at 9% while bringing inflation down to 4% Moody's has been surprised by the slowdown in India. Increases in interest rates have not brought down the rate of inflation while slowing growth. To increase growth " .... interest rates may have to be eased, but above all, rampant corruption needs to be stamped out , and authorities need to liberalize regulations that currently suppress local and foreign investment". Everyone can see that except the politicians who are trying every dirty trick in the book to make the Lokpal a completely useless organisation which will be unable to stop criminal politicians and thieving civil servants merrily looting the country. This is not a subject for debate about the supremacy of parliament as the freeloading press has made it but treason wherein a bunch of criminals condemn the country to poverty to protect their black money. Meanwhile India's foreign currency reserves fell by $4.67 billion in the week ending December, 16. This may have been due to the RBI's ill-judged attempt to support the rupee against its precipitous fall against the dollar. So desperate is the RBI about foreign investors or FIIs fleeing the Sensex combined with falling Foreign direct Investment or FDI that it has removed all controls on Non-Resident External accounts. Banks are now paying up to 9.6% on NRE deposits compared to 3.8% previously. While drawing in more dollars in the short term this will only make our balance of payment much worse as non-resident Indians and foreigners take advantage of the marvelous arbitrage opportunity wherein they borrow at 0% interest in the US and invest here at 9.6%. One man has presided over the booming corruption and collapsing economy but the treacherous press has hyped him up as a World Famous Economist as well as an Honest Man. History will write the truth about this fellow but, sadly for us, history is usually posthumous. Gad save India.

Sick justice.

India is not the only country where justice is arbitrary, influenced by politicians and sentences depend on whims of judges. In Britain, which is forever lecturing others about due process and human rights, teenagers who had committed no crime were sentenced to long jail terms just for being physically present at the scene during riots in August. Guardian Weekly, December 9. Sharon, a 19 year old, was caught up in the rioting. She entered a looted shop and picked up a pair of mismatched trainers, then dropped them and took a bus home. Her home was raided by police at 3am, like the KGB or Gestapo, and she was sentenced to 10 months in prison just because she was seen on CCTV. Thus a 19 year old gets a criminal record affecting her employment prospects for life for something she did not do. Samuel, 18 years old, was arrested empty handed standing in a Curry's store which had already been looted. His mother could see him in prison only after 5 days and when she returned home she found an eviction notice from Wandsworth County Council. Britain never fails to criticise Israel for demolishing houses of terrorists because it is collective punishment for the entire family for the crimes of one but here a family was being made homeless not for committing any crime but just for being present at the scene of a crime. Lord Chief Justice Lord Judge said," Given the overall ghastliness of what was going on in the country, these sentences had to be significantly higher." In short, justice was dictated by politics. Yet in Britain senior police officers of Scotland Yard, who had been exposed as having accepted bribes from News International, were allowed to resign presumably with all pensions and other perks. Every issue of Private Eye is full of stories about politicians and civil servants giving contracts to dubious companies costing the taxpayer hundreds of millions of pounds and then being paid extremely lucrative salaries to sit on boards of the same companies. David Cameron rabbits on about the " Big Society " but does not realise that big society is composed of little people. Marie Antoinette was shocked when a friend admonished her for being naked in front of men because she did not consider servants as " men ". Cameron would do well to remember what happened to her.

No respect without honor.

" Satyamewa jayate " is India's motto inscribed at the base of the Ashoka pillar. It means truth will triumph. Sadly all our politicians are liars supported by a freeloading press. The lie of the moment is " dignity of parliament ". Can an institution full of criminals despised by the people have any dignity? When Pakistani cricketers were found guilty of spot fixing by a London court the press was unanimous that cricket was tarnished for ever. So it is with football with John Terry being accused of racist comments. Thus the parliament is a collection of dishonorable characters trying every trick to avoid a proper Lokpal Bill. Definitely no dignity and not deserving of any respect. This was amply illustrated by the universal approval of Mr Lalu Prasad's speech yesterday. In case readers have forgotten he is the magician who is alleged to have pocketed Rs 9.5 billion from cow fodder or straw. When under investigation he installed his illiterate unelected wife as chief minister of Bihar. He has demanded reservation for SC, ST OBC, women and minorities in the 9 member Lokpal which was greeted with delight by all members because this will essentially emasculate the ombudsman. Referring to Anna Hazare's campaign for a strong Lokpal Mr Lalu said, " Parliament cannot be run from a footpath." No indeed. A cesspit of corruption can only be run by worms. " We are the lawmakers," he declared. No again. You lot are law breakers and should be in prison for life. " I must confess that it is a little disappointing to sometimes hear negative comments emanating from our business leadership or be told that government's policies are causing slowdown and pessimism in the industrial sector," said our most revered Prime Minister. Not true again. Negative comments are coming from the people. In a survey be Transparency International majority of people politicians and police are the most corrupt. More than 48% said political parties are the most corrupt institutions, 34.2% said parliament and legislatures are corrupt bodies and 40.4% found the police corrupt. TOI, December 24. Not much respect or dignity. There is never going to be a strong Lokpal, criminals will keep control and the economy will collapse. That is the truth.

Middle east games.

Just 4 days after US troops left Iraq multiple explosions killed dozens of people in Baghdad. The government blames Al Qaeda in Iraq linked to Sunni groups. This is being interpreted as revenge or warning for the warrant issued for the arrest of Vice President Tariq Al-Hashemi who is Sunni. The Prime Minster, Nouri Al-Maliki, a Shia, blames Hashemi for terrorist attacks on government officials and defence personnel, a charge angrily denied by Hashemi. With the help of President Jalal Talabani, who is a Kurd, Mr Hashemi has escaped north, into area held by the Kurds. Maliki has demanded the Kurds hand him over to face justice. Hashemi has accused Maliki of behaving like a dictator and asked investigators to come to him because he does not think he will get justice in Baghdad. All very stupid and lethal so far. But why is Maliki precipitating a crisis that could lead to a civil war? He has everything to lose. If Iraq gets divided along sectarian lines hundreds of thousands will die and the economy will disappear. Is he acting on orders from Iran? Iran is in a very tough position. After the trashing of the British embassy in Teheran more sanctions have been imposed on the country already suffering from shortages and a high inflation from previous sanctions. The Assad regime in Syria, Iran's best friend in the region, looks to be tottering and its collapse will bring in a Sunni government who will hate Shia Iran. Worse because of Syria's control over Lebanon Iran's hounds, the Hezbollah, will lose support. At best it will not receive supplies of arms sent by Iran, at worst Syrians may topple the Hezbollah government in Lebanon and dismantle its structure. If Shias get complete control over Iraq then Iran could move forces into southern Iraq which has a very long border with Saudi Arabia. With this move they can blackmail the west by threatening its oil supply. Also the beards in Iran would love to get control of the 2 Holy mosques in Saudi Arabia. Western countries can never allow this to happen so war will become inevitable. Israel would love that because it could use the confusion to try and bomb Iran's nuclear facilities. What were the predictions in the Mayan calender for 2012? When you are dreaming of 72 virgins reason disappears.

" If the country has high fiscal deficit and high inflation, and also high current account deficit, I don't see why the currency will not depreciate," said Deputy Governor of the Reserve Bank, KC Chakrabarty. Uncontrolled fiscal deficit is caused by various social schemes which cost vast sums of money but have done nothing to reduce poverty or hunger. The reason is that most of the money is stolen by local politicians and civil servants. Most of these schemes are actually bribes to the " vote bank " to win elections with taxpayers' money and as such this is probably the biggest scam in India far outstripping the 2G, Commonwealth Games, mining scam and all other scams put together. This was proved by the news that the Congress is furious at state governments for taking all the credit for social schemes such as MGNREGA, Pradhan Mantri Gramin Sadak Yojana, Indira Awas Yojana, Total Sanitation campaign and old age pension. At Rs 880 billion this government is spending the highest on social scams and is furious for not getting credit that it thinks is its due. TOI, December 22. We were not aware that the Congress has such a sense of humor. Anyone travelling by train in India has to endure the sight of naked buttocks of people defecating in fields and beside railway tracks. Total Sanitation Yojana has to be the biggest joke perpetrated on the people of India. In the midst of all this credit rating agency Moody's has upgraded the rating of government from speculative to investment grade sparking a 510 points or 3.36% rise in the Sensex yesterday. Why? On the same day Moody's has forecast GDP growth will fall below 7%. We know ratings agencies were spectacularly wrong in the sub-prime mortgage crisis. Recently Standard and Poor's downgraded US credit rating only to see investors piling into the dollar and US bonds. Yield on 10 year Indian government bonds are at 8.4%, there is no hope of controlling deficit and the rupee is expected to fall further. To make matters worse the government is going to introduce Food Security bill which aims to give cheap grains to 70% of rural and 50% of urban population. This will make fiscal deficit and inflation soar and the rupee to sink. So what is the reason for Moody's action. Mystery!

Who needs leaders.

It is hard to understand the reaction of North Korean people to the news of the death of Kim Jong Il, the President. The news was first broken on national television by a dour looking woman who immediately broke into sobs. This was followed by incredible scenes of everyone on the streets, public transport and offices sobbing without control. Grown men were banging on tables while crying loudly. " Oh why did you have to leave us," said one who looked to be at least 50 years old. To be sure a lot of people had no tears, so made it up with histrionics. The whole thing looked astonishing, ridiculous and scary, very scary. Why should educated and rational adults behave in such an embarrassing manner? It is obvious that they are doing what is expected of them. If so, have they been so brain-washed that they have become automatons responding automatically to cues given by the government? Thankfully such control would be well nigh impossible in India.North Korea is a homogeneous country speaking one language while India is a diverse country with scores of languages, differing cultures and completely different climatic conditions leading to different demands by the populace. This diversity was a weakness that was exploited by marauders who conquered the country at different times but is probably what protects us from such a dictatorship. We had our own Dear Leader, Great Leaders and have a Great Successor with an army of sycophants who would stoop to any perversion to get him to power but their power does not extend to the whole country. The country is divided into territories controlled by regional crime bosses who want their own spawn to capture power leading to competition and score settling which protects us from becoming a North Korea or a Burma. This is ultimate capitalism. Competitive villainy preventing power from concentrating in any one individual, family or party, leading to a balance forcing protagonists to settle for " democracy ". Did Adam Smith have something to say about this?

The union cabinet will meet today to discuss the final contours of the Lokpal Bill to be introduced to Parliament. The debate has been on whether the Prime Minister and lower ranks of the civil service should be under the ambit of the Lokpal but the real problem for the politicians has been the demand for the CBI to come under control of the Lokpal. Indian politicians being criminals fear being imprisoned if the CBI is truly independent. Mr Sharad Yadav, a politician, has said," If the CBI is independent not 27 but 27000 people will be in jail for corruption." Even this emasculated bill is up for discussion only because of the campaign by Anna Hazare against corruption. While it is easy to understand why criminal politicians and thieving civil servants are hostile to Hazare it is hard to fathom the reason for the hostility of the English press. Except for an occasional article supporting Hazare the vast majority are critical, even abusive, of him. What is worse, most of the criticism is based on lies. One lie is that Parliament is supreme. It is not. The people are supreme. A second one is that it is the sole right of MPs to enact laws and to ask them to pass a law for a strong Lokpal is to disrespect Parliament. Firstly, MPs are merely representatives of the people who have to express the will of the people. Secondly, politicians are criminals and to say that is stating a fact and not disrespecting Parliament. Some of the articles are personal attacks on Hazare who has nothing to gain from a strong Lokpal. One fellow quotes that champion of democracy, Shiv Sena leader Bal Thackeray as saying that Anna's pressure tactics denigrate Parliament. Thackeray also says that all the laws are there to stop corruption, all it needs is the will. Exactly. Criminal politicians will never have the will unless they receive a hard kick in the pants. But why are journalists so angry with Hazare? Most journalists are freeloaders, getting free drinks, banquets and cheap land at taxpayers' expense. A lot of them must be getting a share of the loot collected by the politicians to keep them quiet. They are angry because a strong Lokpal will reduce their black money by making it difficult for politicians to steal. Sneaky bastards.

Art or con.

A cleaner at Ostwall Museum in Dortmund, Germany ruined a piece of art called " When it starts dripping from the ceiling ", worth a cool $1.1 by artist Martin Kippenberger, by cleaning it. Guardian Weekly, December 9. This so called art comprised a wooden tower with a rubber bucket beneath it. A layer of paint in the bucket was supposed to represent dried rain water which, to the cleaner, looked like dirt and she cleaned it off. So what is art? Is it worth the price that is quoted? The price may be a reflection of the fact that works of art, meaning paintings and sculpture, are unique and cannot be reproduced. This makes them relatively inaccessible to majority of the people on earth. Extremely few people can afford to travel to Paris to see the Mona Lisa, then to Florence to see Michaelangelo's David and on to Amsterdam to the Van Gogh museum. Also a lot of works are with private collectors who buy them as investment and keep them in secure vaults. We are thus dependent on critics' evaluation of the greatness or otherwise of a work of art. It is easy to understand a painting or sculpture which is like real life such as the David which one can understand and admire but it is impossible to understand modern art such as Picasso's Guernica even if it hailed as a masterpiece. An eye on the abdomen, a breast between shoulder blades, an arm sprouting from the middle of the forehead looks like confusion and meaningless. Then there is post-modern art. A pyramid of cans of baked beans, an unmade bed with crumpled sheets or a pile of beer bottles, ashtrays and coffee cups seem to be an easy way to shock people and grab attention. But surely it is not art. In that case the series of movies on chain-saw murders should win Oscars. The question is- do critics actually understand what is art or are they a bunch of pseudo-intellectual frauds using big words to impress us of their importance when they extol, what is essentially, a pile of crap? It should be simple. If it is not beautiful it is not art. It may be shocking, it may make a " statement " or " make us think by challenging us " but it is not art. It is just an elaborate con trick to delude people and making money. Like sub prime mortgages.

Killing growth.

Politicians, business leaders and the press all want the RBI to reduce interest rates to stimulate growth. Businessmen want low interest rates so that they can borrow money cheaply to finance personal extravagance such as palatial houses, big cars and foreign travel. Grosvenor and Berkeley Squares in London are called Indian ghetto because of the number of houses bought by Indian billinaires, each house costing well over a million pounds. Politicians want growth because that increases tax collection which then finances their lavish life and foreign travel but, more importantly, allows them the luxury of distributing free goodies to the poor to win elections. The press is merely freeloading, barking to the orders of its masters. There is no discussion or debate about whether unlimited growth is possible or even desirable without destroying the environment, causing inflation, which kills the poor, and creating asset price bubbles, like the sub prime mortgage crisis, which have to burst creating untold misery. This unequal growth is concentrating wealth in the hands of 1% with the other 99% growing poorer. This is what the Occupy Wall Street protesters are saying. One Wall Street fellow is reported to have justified his astronomical bonus by saying that he pays taxes whereas the protesters do not. He does not understand that the protesters are unemployed because of predators like him. Also, if you pay taxes on the proceeds of bank robbery does that deserve to be rewarded? An internet company, Zynga has just had an IPO on the Nasdaq. Its most popular game is called Farmville where you can buy virtual money with real money. Futures, options and credit default swaps are creating virtual money by betting ever larger amounts and like in any gambling there have to be losers. This is what happened to Lehman Brothers and AIG. Sadly, politicians will not listen. They will continue with policies to increase growth until, like lemmings, all of us go over the precipice. Maybe then we can get rid of them.

Former President of France, Jacques Chirac was found guilty of illegally accepting money while mayor of Paris many decades ago and given a suspended sentence of 2 years in prison. In Russia tens of thousands of people have come out in protest against Vladimir Putin's party for stealing the recent parliamentary elections. The protests were ignited by a tweeter feed by one Alexei Anatolievich Navalny calling on " nationalists, liberals, leftists, greens, vegetarians, Martians " to unite against " the Party of Swindlers and Thieves ", his description of Putin's United Russia party. However authoritarian Putin may be at least his son will not be automatic choice for the next party leader after him. Unlike in India where we had father followed by daughter, followed by son. Now the son of the son is being groomed for the post of party leader and hopefully a future prime minister. This is possible because of an army of invertebrate creepy crawlies willing to impose censorship, ruin the economy and beat up and kill anyone daring to criticise The Family supported by false propaganda from a freeloading press. Unlike in France all investigating agencies are controlled by the party so there will never be justice which makes India a true dictatorship. Reality.

Enormous confusion surrounding contraction in industrial output by 5%. Seems that statisticians had reported a growth in the capital goods sector by 25% in the previous month when, in fact, it had shrunk by 25.5%. They had apparently forgotten to put a minus ( - ) sign in front of the figure. Between April- October engineering exports were reported in excess of $15 billion while jewellery and petroleum goods were under reported by $12 billion. No wonder our most revered Finance Minister has no clue as to what can be done about the falling rupee. Rate of growth is falling, fiscal and current account deficits are rising and foreign currency reserves are sufficient for 8 months of imports, down from 12 months just one year ago. Yesterday the RBI sold dollars to support the rupee so our reserves must be even worse this morning. Ten year bond yields have touched 8.5%, anything over 7% is considered unsustainable for European economies. This is because of wasteful spending of taxpayer money for various dubious schemes to win elections which increases deficit and the only way the government can pay is by borrowing from the market putting pressure on rates. Printing notes to pay back debts only raises inflation and weakens the rupee. The only good news is that food inflation is down to 4.35% but the Wholesale Price Index is still at 9.1%. Every idiot is clamoring for a decrease in the interest rates which, they think, will boost growth by boosting business but the RBI may have to increase rates to support the rupee. Luckily we have the World Famous Economist and the great sage to guide us. Hope they do not turn into Santa and Bunta.

Taxes kill. In Sangrampur village in Bengal 63 men, mainly rickshaw pullers and laborers, have died of methyl alcohol poisoning after drinking locally brewed hooch. Another 80 are in hospital. How many will end up blind and unable to earn a living only the future will tell. This is a regular occurrence in India directly related to extremely high taxes on alcoholic drinks. Beer, which costs less than Rs 10 a bottle to manufacture, costs more than Rs 100 in some states. In Delhi the cost of a bottle of beer has gone up from Rs 30 to Rs 60 in recent months because of increasing taxes. High taxes are necessary to balance the money being looted by criminal politicians and thieving civil servants. One female politician has been squatting illegally in a government accommodation for decades and owes Rs 20 million in rent which succeeding governments of different parties have forgiven her. When this parliament met for the first time the first order of business saw a bill allowing ministers to travel first class at taxpayers' expense with family, friends and others. These scoundrels go abroad with children who are not subjected to customs check when they return. We can safely assume that these scum are smuggling in millions of dollars worth of contraband every year. Air India is bankrupt with debts in excess of Rs 400 billion and the government has agreed to spend Rs 200 billion of taxpayer money to bail it out. Yet a proposal being considered by the Air India board would allow its top officials First and Business class and international travel for life and for their extended families even after their deaths. Exterminate the vermin. That is the only way to survive.

A madrassa in Pakistan, known locally as jail madrassa, was raided by Karachi police after a tip-off and found to have basement with some 50 men and boys in chains. They told horror stories of how they were kept in chains, beaten with a leather belt and starved. Police took the men and boys to the local police station still in chains because they could not find the key and the head of the madrassa had fled. The real horror came later as relatives of the prisoners refused to take them back. One father told the BBC that he was not willing to take his son home because he would revert to stealing and other criminal behavior. Adults everywhere claim the right to have children without any consideration for the rights of children. As a result, children in many countries are victims of such inhumane crimes that it makes you cringe. If animals were treated as human children the perpetrators would be in prison but parents, especially in poorer countries, are allowed to breed without any thought on how to feed, clothe, educate and pay for illnesses and children suffer the most excruciating misery throughout their lives. Some religions discourage family planning as against God's will of " go forth and multiply " without telling us why God would wish children to suffer. Strangely even in rich countries where fertility rates are very low children seem to be under great stress. Teenagers in Britain have earned a name for excessive drinking and anti social behavior which strict laws have failed to curb. In the US shootings by students are becoming a regular occurrence. Crimes against children are an abomination. Children should have a right not to be born.

Industrial output shrank by 5.1% in October leading to a fall of 343 points in the Sensex. Immediately a cry has gone up for a reduction in interest rates even though core inflation is at 10%. Politicians, civil servants and business tycoons want interest rates to come down so that property prices start climbing again because that is where they have parked all their black money. It would be suicide if the RBI were to buckle under this concerted pressure and reduce interest rates because inflation could then jump resulting in economic disaster. China's economy is also slowing down. Its communist oligarchy depends on high rates of growth to generate more jobs and a higher standard of living to keep its population quiet and head off any demands for political reform. Yet, even though inflation has dropped to below 5%, China has not reduced interest rates but is cautiously reducing cash reserve ratios for banks to encourage them to lend more because it recognises that inflation causes greater hardship. The only way for India to survive is to reduce government spending. Cut the number of government employees by 80%, allow Air India to go bankrupt, no salary increase for civil servants unless they accept hire-and-fire, reduce entitlements for politicians, control population by denying social help to anyone who has more than one child and engineer a fall of 70% in property prices to wipe out black money from the system. So that there is no hardship announce that no social help will be given to anyone born after 1995, who is 16 years old and thus unmarried, if they have children. Sadly politicians only want votes because that is the way to loot. Traitors.

So, Pakistan Prime Minister, Gilani thinks that there is a lack of trust between the US and Pakistan after the killing of 24 Pakistani soldiers by NATO troops recently. Before that 2 Pakistanis were executed in cold blood by Raymond Davies who was then found to have diplomatic immunity. In total humiliation Pakistan was made to release Davies without any conditions. Then Osama bin Laden was killed right under the army's noses in the garrison town, Abbottabad. The Pakistanis were not informed in advance showing how the US mistrusted them. The US has been using drones to kill Taliban militants within Pakistani territory violating their sovereignty at will. Now Gilani said in a BBC interview that the border crossing into Afghanistan, which is used to supply NATO troops, will remain closed for weeks. Gilani is just repeating the old Pakistani bluff of being indispensable in the fight against terror, how Pakistan is an ally of the US and how Pakistan is the largest sufferer of terrorism having lost 30,000 civilians to terror attacks. The world has grown tired of these lies and is beginning to see Pakistan for what it is, a failed state controlled by totally corrupt armed forces who are the sponsors of terrorism worldwide. If the US was not so blinkered it would have acknowledged that the 9/11 attacks were masterminded by the ISI. Exposed for what it is Pakistan runs to China for comfort but it should know that the cockroach-eaters are a brutal uncivilised people as was shown when Pakistan had to tender a grovelling apology for Uighur unrest in Xinjiang province. Pakistan should realise that mad dogs have no friends. They end up getting shot. To death.

In a surprise move Britannia, the biscuit company, sacked 42 executives in one fell swoop. TOI, December 9. The company says that staff performance parameters have been sharpened this year and employees are now being graded as " great, good and gone ". How brutal is that? George Monbiot in The Guardian Weekly, November 18 quotes Danial Kahneman, winner of a Nobel prize in economics, who studied 25 wealth advisers over 8 years and found that their performance had zero consistency. " The results resembled what you would expect from dice-rolling, not a game of skill," he said. Belinda Board and Katarina Fritzon tested 39 senior managers and chief executives from leading British businesses and compared the results with patients at high security Broadmoor mental hospital. On certain indicators of psychopathy the business bosses matched or exceeded the scores of the patients. Published in the journal Psychology, Crime and Law. Seems that people who are successful executives reach the top by a mixture of sycophancy, egomania and ruthless exploitation of others. We are told repeatedly that chief executives of companies have to be paid astronomical sums of money because they are the best but that is not true. What is worse is that chief executives take the credit and vast sums in bonuses when companies make profits but are not held responsible for losses. John Thain was paid $ 83 million even as Merrill Lynch was bankrupt and Fred Goodwin was allowed to depart with a pension of 1 million pounds when RBS was rescued. CEOs must be made to pay back money for losses and banned if the company fails. That would be just.

A peon at Ujjain Municipal Corporation, MP has been found to possess fully furnished air-conditioned homes, a farmhouse, 3 cars, 4 two-wheelers, 5 acres of land in Maharashtra and Haryana and is part owner of a factory. Initial estimates put his wealth at Rs 100-120 million when he has legally earned Rs 1.2 million in salary in 31 years of service. No surprise. An overwhelming majority of government employees are criminals, enriching themselves with direct theft of funds and extorting bribes from the hapless public. And there are millions of these useless parasites. They are a major source of black money causing the bubble in the property market leading to uncontrollable inflation, depreciation of the rupee and collapsing economic growth. Their salaries are higher than in the private sector which is the main reason why we have to pay extortionate taxes which, in turn, add to inflation and reduce growth. In spite of constant lies about how oil products are being subsidised it seems that the government earned over Rs 1 trillion in 2010-11, an increase of 43% or Rs 300 billion over the previous year. TOI, Friday November 25. Of this Rs 262.81 billion came from customs duties and Rs 765.46 from excise. Although oil companies are said to be incurring a loss of Rs 1.32 trillion they have paid out 13% more in dividends. Bunga bunga economics by the Congress. In a macabre joke in the Parliament our most revered Finance Minister said that although the economy is in a lot of bother there would be no need to eat lizards as the fundamentals are strong. When everything is paid for by the taxpayer you can be oh so humorous. Callous!

Dramatic last minute conference in Europe to sort out the financial mess. Leaders of all 27 countries are meeting to consider a deal worked out by Merkel of Germany and Sarkozy of France. This proposes - 1. All Eurozone countries pass laws to balance their budgets, 2. European Commission to have the power to impose penalties on those exceeding budget deficits, 3. Eurozone countries to have common corporate and financial transaction taxes and 4. Private investors to be protected in any future bailouts. Many leaders will resent what they will see as a blow to sovereignty but it is especially hard for David Cameron who will be judged on standards set by Margaret Thatcher who has been immortalised in Conservative Party folklore because she won 2.5 billion pounds in tax refunds for Britain by wearing out all other leaders by her sheer pigheaded refusal to listen to any other alternative. Already Labour Leader, Ed Milliband taunted Cameron in the House of Commons by saying that he instead of handbagging the EU Cameron has been left handwringing, to the jeers of Labour MPs. Cameron has promised to veto any deal that does not take British interests into account. Trouble is, if he scuppers the deal he will be blamed for the resulting financial disaster. Eurozone countries led by France and Germany may decide to form a separate bloc ignoring Britain and making it impossible for Britain to have any influence in the future. Any financial problem caused by Britain will affect the US economy and as a slave country Britain dare not annoy its master. If he agrees he will face Tory party wrath back home. Not easy to carry a handbag. You need balls.

How low will Congress politicians sink? Telecom Minister, Kapil Sibal has demanded that internet services such as Google and Facebook manually screen content from India to find and delete offensive and derogatory content. Cunningly he sited insults to religion as his reason for this weird request. That he is lying is revealed by Google Transparency Report which between January-June Google received 358 requests from government to remove content from its sites of which 255 were for criticism of the government. Only 8 ( 2.6% ) were for hate speech and 3 for pornography( 0.78% ). Told to shove off, and rightly so, he has threatened to institute some form of censoring. As per HT editorial today his gestapo tactics were prompted by 3 we-hate-Sonia Gandhi sites on Facebook. It is astonishing that Congress invertebrate creepy crawlies have absolutely no shame in public footlicking . Because of such unquestioning and absolute support Mrs Gandhi has power of life and death over all Indians and inspires a great deal of fear. Even opposition politicians never dare to criticise her. It is this fear that is expressed in these sites. Meanwhile retired Judge of the Supreme Court and presently Chairman o the Press Council has criticised the press for reporting actor Dev Anand's on front pages of newspapers. He is of the opinion that poverty, farmer suicides and economic problems should have precedence. For most Indians life is a miserable struggle for survival. Dev Anand took people away from reality into a fantasy world of love and beauty. Away from ugly criminal politicians. Justice Katju maybe trying too hard to see his name in print.

Prof DK Gupta, Vice Chancellor of Chhatrapati Shahuji Maharaj University in Lucknow, UP has written to the Medical Council of India to grant MBBS degrees to SC, ST students who have repeatedly failed their exams. A few have been trying since 1996. Prof Gupta makes the valid point that since these students were allotted seats in medical school with low marks at their entrance exam, because they belong to the reserved category, they should be allowed to graduate despite failing their exams. ( msn.com ). " As students have failed consecutively on several attempts, they be allowed to have a degree," he said. Predictably about 50 students have accused faculty of deliberately failing SC, ST students. Seems that belonging to the reserved category not only entitles these people to undeserved opportunities but also puts them above the law. Justice Dinakaran claimed that he was accused of land grabbing and other crimes only because he is scheduled caste. It is true that upper castes have treated lower castes shamefully in the past but that is no reason to permanently reserve jobs and education places for unfit candidates just because they happen to belong to a lower caste. This has resulted in a continual process of dumbing down until 80% of graduates are unemployable. As it is some 85% of doctors in India are quacks. Ordinary people suffer because they have no way of knowing who is from the general category and who is reserved. Politicians may spend one month in the US in 5 star comfort with son-in-law but most of us have to do with the rubbish we have. Two wrongs do not a right make. It only creates a vast pool with useless degrees.

At a recent marriage party in Delhi all the ladies were seen to be wearing tons of gold jewellery in some sort of unwritten competition. Is it some genetic trait that forces women in the east to be addicted to gold? Gold is always yellow in color and may not match the clothes that a woman is wearing. Wearing a chain thick enough to restrain a buffalo and bangles the size of handcuffs looks crass and tasteless and detracts from the designer clothes that the woman has bought. Some women may be trying to divert attention away from wrinkles of old age or rolls of fat from over indulgence but the effect is hideous. Yet women will not listen to reason. Perhaps it is an unconscious effort at making other women feel inferior by showing greater prosperity and thus increasing prospects of finding a better mate. To that extent it is probably genetic. Apparently Indian households possess 18000 tonnes of gold valued at $950 million. TOI, Monday December 5. There was a 72% year on year increase in gold holding in 2010 and further 5% increase this year. Since gold has to be imported this has resulted in worsening of the current account deficit and is one of the reasons for the falling value of the rupee. Unlike other assets like property which generate rent and shares which pay dividend as well as appreciate in value gold does not provide any regular income. Its price can fall as of any commodity. In 1980 price of gold went up to $900 a troy ounce but then fell to around $270. Most of the gold is locked away in bank lockers. We are not told how much remains unclaimed and what happens to it. Shows how Indians do not trust their currency. With reason.

India has no dearth of sycophants or chamchas as they are known here. A wide range of people from business executives to bank managers to civil servants have come out of the wood work to blame the RBI for stalling economic growth by increasing interest rates. But what is the RBI to do when it has to contend with spiraling inflation, falling rupee and a government led by the World Famous Economist intent on driving the country to bankruptcy by insane spending? A tiny news item, TOI, Saturday December 3 says that the RBI is constantly monitoring liquidity in the financial system and is buying back government bonds to inject more money when needed. In the last week the RBI has bought back Rs 200 billion worth of government bonds. So on the one hand the RBI is selling government bonds to raise money from the market, which sucks out liquidity, and on the other the same RBI is buying back the same bonds to inject liquidity. What does this mean? Is it a fiendishly difficult financial ploy to stimulate the economy with zero inflationary stress or is this a sign of a criminal government led by the Congress using vast sums of public money to win elections by blatant bribery of sections of the electorate? The problem is that the RBI has chickened out of its duty of controlling inflation. It should raise rates further until property prices fall by 70%. This will suck black money out of the system, lower inflation and strengthen the rupee by drawing in deposits from abroad. The RBI should also have some currency control to limit arbitrage trading. Politicians are never going to learn from slaps and slippers. How to get rid of these slimy creatures?

" Of course I am not in a position to provide the level of fiscal stimulus which I was able in 2008-09.....," said our most revered Finance Minister. That so called " stimulus " was a blatant bribe to civil servants and farmers to win the general elections in 2009. It also injected a huge amount of liquidity into the system and acted as a stimulus but it was unproductive and left the government bankrupt by not increasing tax collections. Hence the inability to stimulate the economy at present. The government needs another Rs 500 billion to keep going. Borrowing more from the market will only increase the deficit and drive up interest rates by sucking funds out of public sector banks who are required to buy bonds at RBI auctions. One way would be to sell shares in government owned companies or PSUs but the share market is volatile and trying to sell a large block of shares will only depress prices. Some of these PSUs are apparently sitting on piles of cash and the government desperately wants to get its hands on the money. Previously PSUs have been forced to pay out big dividends most of which went to the biggest shareholder i.e. the government. Trouble is dividend has to be paid to minority shareholders as well which the government is loathe to do. How to get your grubby hands on public money without sharing with the public? The idea is to force PSUs to buy shares from each other. So company A buys shares from company B and vice versa. Since both companies are owned by the government it still owns the same number of shares but both companies have no money left. Lies and flimflams are not best for the economy. How long before collapse?

The Congress is doing everything in its power to prevent the passage of a strong Lok Pal bill. Having accepted that lower level civil servants or Group C, as they are officially known, should be included within the ambit of the Lok Pal on Wednesday evening the Congress suddenly summoned a meeting of the parliamentary committee on Thursday and reversed the earlier decision. The excuse is that the Lok Pal will be inundated if it has to police 5.7 million Group C employees as well, so only top level civil servants will be answerable to the Lok Pal while the Central Vigilance Commission, which is controlled by the government, will be in charge of the Group C. The civil service in India considers itself above the people and operates on the principle of " through proper channel " which means that an ordinary taxpayer has to approach the lowest level clerk first if he has to get any work done. The clerk will open a file and present it to the fellow above him and so on up the ladder to the decision maker. The diligence of the clerk most often depends on the amount of bribe a person can afford and the money is distributed up the chain. Naturally politicians and civil servants will do anything to see that the spigot is not turned off. A couple of days ago a snake charmer released dozens of poisonous snakes in the tehsil office of Haraya Tehsil in the Basti district of UP is protest against the demand for bribes. He wanted a safe area where to release this snakes and had even written to President Patil, who had instructed tehsil officers to help the snake charmer. They, naturally, demanded bribes and the man retaliated. The scum should beware. Tomorrow it could be bullets.

As expected elections in Egypt are going the way of Islamists. In early results the Muslim Brotherhood has about 30% of votes but the hardline Salafists are said to have received 20% of ballots cast so far. Members of this group were held responsible for the killing of 10 Coptic Christians a few weeks earlier. Israel must be feeling particularly vulnerable as it sees its peace treaty with Egypt becoming redundant. On the other hand Israel will be pleased with the situation in Syria as civil war seems to be getting likelier by the day. If the Assad regime falls and Sunnis gain power it is unlikely to be as close to Iran as the Alawites and arms supplies to Hezbollah, an especially venomous enemy in Lebanon, may dry up. The situation with Iran is very interesting. Following a report by the IAEA saying that Iran is capable of a nuclear weapon US and UK announced increased sanctions. The British embassy in Teheran was trashed by a mob which gave Britain an opportunity to expel the Iranian ambassador in London. Other European countries are taking similar diplomatic measures. Whether this is a last ditch attempt to preempt an attack by Israel on Iranian nuclear facilities, thereby drawing in the US and Britain, or clearing the way for an air attack we do not know. Turkey has suddenly become a key player in this game. Turkish Prime Minister, Erdogan, a cunning Islamist, had good relations with Iran and Assad but has become the most vocal critic of Assad. Turkey does not want a civil war in Syria with thousands of refugees pouring across the border but is risking its relations with Iran. The middle east is motivated by hatred. So which hatred is stronger?