But before the sentimentality, some important business – the last ever San Francisco Bay Area Meetup is tomorrow

• Where: UPDATED LOCATION: The Liberties in the Mission/Dolores area — 998 Guerrero & 22nd (we outgrew Udupi Palace)
• When: UPDATED TIME – 2:30 – 6:30pm — we’ll be lounging for a while so feel free to drop in, share a pint or 2 and listen/tell stories
• Who: friends past & present, old bloggers, current bloggers, guest bloggers, grizzled comments flame war vets, lurkers, and riff raff of various stripes

The Facebook event is here.

So what can I say that hasn’t already been (quite ably) said by my fellow bloggers?

Quite a bit, I think.

Back when the blogosphere was young, and desi blogger ranks were very slim (my first personal blogpost was Sept 29, 2002 & first SM post was August 2004 – an internet lifetime ago), a few kids had an idea for a group blog covering the news & commentary that was less covered.

The medium was new, the excitement was high, and our target market was ripe for a new vehicle for expression, debate, and community. And thus the Sepia Mutiny was born & acquired a life of its own. Over the years, I’ve met perhaps 100 new people through the blog and it’s cemented at least a few, new, lifelong friendships & acquaintances. I know several of my facebook friends better by their handles than by their official Facebook names. And common ground forged by the blog has been responsible for more than few random run-ins literally across the world (one anecdote – while on a biz trip in London, a particularly astute, regular reader I’d never met before saw me crossing the street & shouted out).

As Abhi noted, in the almost 10 yrs since SM was born, a lot has changed. Whereas back in the day we’d post an shout-out if a Desi had so much as a speaking line on TV, now it’s common to find them in regular roles in top 10 sitcoms. Is a Desi romantic lead far behind? Perhaps in another 10 yrs. Or maybe not.

The angst ridden ABCD’s of >10 yrs ago have given way to a new generation of Desi’s who merit the “C” less and less with each passing year. An interesting 4 yr snapshot of that fast forward evolution can be seen comparing 2003′s Where’s the Party, Yaar to 2007′s Loins of Punjab.

The broader blog universe has changed dramatically as well. And, of course, so have we the mutineers – a term we judiciously use to cover both the bloggers & the readers. As 20somethings, most of us were single, had all the time in the world (though we didn’t fully appreciate it at the time) and were often just establishing our careers –> factors which contributed individually & in their own unique ways to our “drive” to blog & comment. As 20s gave way to 30s (and in my case, late 30s, gulp), life has a way of reminding you who’s in charge (my wife?).

For me personally, my ~400 Sepia Mutiny posts are here.  And, over at my (languishing) personal blog, I’ve compiled lists of some of my favorite ~40 or so posts over the years - 1, 2, 3, and 4.  While I tended to cover econ & current events, many of those favorites focused on “hidden history” — Did you know that the Nazi’s promised Stalin full reign over India if he’d help defeat the Brits?  Or how seemingly simple, but utterly economically profound issues like ”Title” to land get established?   And on a completely different note, how can we ignore the phenomena that’s Finnish Bhangra?

Hitting some of those links, reading the entries, and in particular, reading the comments provide a pretty fascinating (and occasionally embarrassing) trip down memory lane. How vehemently we argued, how sure of ourselves we were, and what a product of our times we turned out to be. How much more we know now and how much has been forgotten. And we’re not even that old yet

So, thanks for the fun, camaraderie, memories, and vibrant discussion – and I’m sure we’ll cross paths as we witness & conquer new domains. And if you’re in/near the San Francisco area tomorrow afternoon, swing by the Liberties & share a drink as we toast new adventures.

But is it really true? Are there really more than a billion people going to bed hungry each night? Our research on this question has taken us to rural villages and teeming urban slums around the world, collecting data and speaking with poor people about what they eat and what else they buy, from Morocco to Kenya, Indonesia to India.

Despite rising incomes & cheaper than ever food, for some reason, too many poor folk are simply choosing NOT to expend their $$ on nutrition –

Despite the country’s rapid economic growth, per capita calorie consumption in India has declined; moreover, the consumption of all other nutrients except fat also appears to have gone down among all groups, even the poorest. …at all levels of income, the share of the budget devoted to food has declined and people consume fewer calories.

[Indians] and their children are certainly not well nourished by any objective standard. Anemia is rampant; body-mass indices are some of the lowest in the world; almost half of children under 5 are much too short for their age, and one-fifth are so skinny that they are considered to be “wasted.”

So what’s going on? And what should “we” do about it?

One culprit are those oh-so-important social obligations & other indulgences –

…In Udaipur, India, for example, we find that the typical poor household could spend up to 30 percent more on food, if it completely cut expenditures on alcohol, tobacco, and festivals….Studies have shown that when very poor people get a chance to spend a little bit more on food, they don’t put everything into getting more calories. Instead, they buy better-tasting, more expensive calories.

…We asked Oucha Mbarbk what he would do if he had more money. He said he would buy more food. Then we asked him what he would do if he had even more money. He said he would buy better-tasting food. We were starting to feel very bad for him and his family, when we noticed the TV and other high-tech gadgets. Why had he bought all these things if he felt the family did not have enough to eat? He laughed, and said, “Oh, but television is more important than food!”

If the poor are malnourished despite higher incomes and cheap (and often subsidized) food, it raises some significant developmental economics questions.

Most modern foreign aid debates tend to fall somewhere between 2 poles –

• Top down planners who generally focus on large scale solutions based on key macro variables. One example –

  [Jeffrey Sachs] has argued that poor countries are poor because they are hot, infertile, malaria-infested, and often landlocked; these factors, however, make it hard for them to be productive without an initial large investment to help them deal with such endemic problems. But they cannot pay for the investments precisely because they are poor — they are in what economists call a “poverty trap.”

• Bottom up advocates take a more Hayekian view. For individuals like William Easterly, development “problems” may appear one way from up high but the ground truth is often far different & more complex. At best, our goal should be helping others help themselves. At worst, our top down solutions often backfire because they entrench & pervert the local institutions which were often the problems in the first place.

While Banerjee & Duflo dislike both extremes, their observations do end up at on point much closer to Easterly’s than Sachs –

We often see the world of the poor as a land of missed opportunities and wonder why they don’t invest in what would really make their lives better. But the poor may well be more skeptical about supposed opportunities and the possibility of any radical change in their lives. They often behave as if they think that any change that is significant enough to be worth sacrificing for will simply take too long. This could explain why they focus on the here and now, on living their lives as pleasantly as possible and celebrating when occasion demands it.

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Ahh, that old time consistency tradeoff.

For better or for worse, a deeper recognition of the poor’s own agency might still be the best path forward. In other words every man is ultimately captain of his ship and even this often ultimately creates the rising tide. And, for Mr. Mbarbk, the guy quoted earlier who found his TV more appealing than food, participation in a broader economy isn’t a nonconsequential thing. Even TV can set in motion the wheels of long term progress.

[prior SM coverage of Duflo's work]

Households with children with the highest welfare use rates are those headed by immigrants from the Dominican Republic (82 percent), Mexico and Guatemala (75 percent), and Ecuador (70 percent). Those with the lowest use rates are from the United Kingdom (7 percent), India (19 percent), Canada (23 percent), and Korea (25 percent).

While 19% “feels” higher than I’d expect, it’s still a little less than half the rate of “native households with children” (39%). And, the Indian number is positive relative to those hordes of poor, illiterate, malnourished, Americans-of-Canadian-descent (23%) and is the lowest rate of use of any of the Asian communities identified. A model minority?

Interestingly, I’ve always generally assumed that immigration patterns from India vs. Pakistan into the US were basically the same. However, the Pakistani-household rate of assistance – 32.8% – is substantially higher than the Indian one and on par with the rate for Chinese families – 32.7%.

CIS’s intro to their study notes the issues being raised and points out that the data collected is primarily self-reported (with all the issues/concerns entailed) –

Concern that immigrants may become a burden on society has been a long-standing issue in the United States. As far back as colonial times there were restrictions on the arrival of people who might become a burden on the community. This report analyzes survey data collected by the Census Bureau from 2002 to 2009 to examine use of welfare programs by immigrant and native households, particularly those with children. The Current Population Survey (CPS) asks respondents about their use of welfare programs in the year prior to the survey,1 so we are examining self-reported welfare use rates from 2001 to 2009.

Any mutineers have insight into these differences?

“I know precisely why those jobs go…Because Fiorina shipped them there….Bangalore instead of Burbank.”

Unfortunately, unlike Boxer, Fiorina has actually engaged in the difficult and often unpopular tradeoffs necessary to run a viable company and meet payroll. Boxer ought to instead put more effort into understanding why Fiorina and thousands of CEO’s like her consistently rate California the worst state in the country to do business. As a direct consequence, California jobs are far more at risk of being “outsourced” to other states than the comparatively few that are sent out of the country.

Of course, when you’re dealing with politics rather than economics, where a job was sent to matters far more than the sheer number lost – a fact Boxer’s ad exploits to the fullest.

I was certainly expecting a much less flattering portrayal of desis, crude jokes about accents, and the like. Instead, most of the show was a traditional fish-out-of-water comedy with the joke often on the opey white guy.

The variety of supporting cast sorta intrinsicly ensure that desi portrayals aren’t unidimensional and at least a couple of the characters have room to emerge with some sophistication. Todd, the lead, has got potential white and desi love interests, a back stabbing nemesis, a project, and a budding protégé.

My main problem with the show….it just wasn’t that funny. Todd’s the most developed character and most of his jokes are just too cliché to really hit. The writers appear so eager to avoid simplistic desi characters that they make Todd the simplistic “fresh from Kansas” character instead (does he really expect everyone on the planet to understand a Packer Cheesehead?)

Still, you can see how it takes the Office formula, shakes it up a bit, and tries to create something new. But while so much of the Office is about capturing character nuance (we’ve all worked with or known someone like Dwight), it’s tough to do the same with comparatively alien characters. At least in an initial, 30 minute episode. So, I plan on DVR’ing the upcoming episodes and giving the show a chance to dig out of the laughter deficit it’s currently in.

Miss the episode? Well you can watch it all online here -

Now, for most mutineers who grew up in the post-Simpsons/Apu age, the idea of an entire comedy focused on Desi’s isn’t a theme we particularly look forward to. However, the NYT got a sneak-peak of the show and published a pretty complimentary and hopeful review –

Back in superpower times, cultural clashes took place on this side of the ocean and the joke was on the foreigners…”Outsourced,” which begins on Thursday on NBC and is based on a 2006 movie with the same title, reverses the premise to place an American naïf out of his depth in the developing world.

He is stunned to find a sacred cow wandering freely on the street and even more amazed to learn that his new employees don’t understand a reference to “The Bad News Bears.”..In other words, “Outsourced” could be perfectly awful.

The fact that it’s neither embarrassing nor deeply offensive — once it gets rolling, the show is actually quite charming — is a credit to the cast and the writers. The show mocks Todd’s blithe, well-meaning ignorance as much as it lampoons Indians trying to sell catalog items like fake vomit and “jiggle jugs.”

…South Asians are no longer an exotic minority that needs to be sheltered from comic stereotypes; for one thing, there is no easily recognized stereotype. The Indians, Pakistanis and other characters with roots on the subcontinent vary widely — and it’s hard to think of a show that doesn’t have one.

Archie Panjabi won an Emmy this year for her role as a sexy, enigmatic private investigator on “The Good Wife.” Adhir Kalyan plays an acerbic, Oxford-educated personal assistant on “Rules of Engagement.” Mindy Kaling is a boy-crazy singleton on “The Office,” while Aziz Ansari is a sleazy small-town bureaucrat on “Parks and Recreation.” Sendhil Ramamurthy, who was a geneticist on “Heroes,” is now playing a playboy C.I.A. operative on “Covert Affairs.” And so on.

How will it turn out? Well, I’ll give it a chance, DVR it and post some thoughts tomorrow

Mutineers, I now present you… Finnish Bhangra –

My take? I love it. Like Absolut Mulit (full video here), it represents an incredibly perceptive outsider’s take on desi culture. The music, the singing, the imagery, the dancing, and the overall gestalt are both accurate and ironic. When “inside” and “outside” mesh so darn well, it transcends the usual boundaries and we’re forced to take a step back and recognize just how broad & progressively inviting the diaspora truly is.

The group, Shava, describes themselves and their mission well –

Welcome to the home page of Shava, which is guaranteed to be the world’s only Finnish bhangra group. Shava plays music which is meant for fun and dancing, and Shava’s gigs are a proof that their unique blend of Bollywood-bhangra dance beats with Finnish attitude and language works perfectly to free your mind and your pelvis and to make you get up and dance.

…The group’s name bears no complicated philosophical meaning. Shouting shava, shava>> is normal behaviour for Punjabis having a good time, and it is something the band is trying to teach to Finnish audiences.

Bravo.

COIMBATORE, India — This ancient city has turned itself in recent years into a manufacturing dynamo emblematic of India’s economic rebirth. But a homicide case playing out in an auto-parts factory here is raising concerns about whether the Indian industrial miracle is hitting a wall of industrial unrest.

“We can’t be a capitalist country that has socialist labor laws“Pricol Ltd., which makes instrument panels for the likes of Toyota Motor Corp. and General Motors Co., was rocked in late September when workers burst into the office of Roy George, its 46-year-old human-resources boss. Angry over a wage freeze, they carried iron rods, witnesses say, and left Mr. George in a pool of blood. Police arrested 50 union members in connection with his death, their lawyer says. Charges haven’t been filed.

The underlying question raised by this story is the size, shape & importance of the manufacturing sector for India’s long term economic development…

Historically, nearly all first world nations initially went through a period where manufacturing formed the bulk of their employment. In the US, for ex, manufacturing has shrunk from ~40% down to 10% of the employed but, that’s still roughly ~15-20M people today – a figure which has held remarkably constant for the past 40 yrs. China, of course has charted a league of its own and currently employs a whopping 80-100M in manufacturing.

India, by contrast, is hoping to pioneer a development path led by the service sector. The potential problem with this is that while gleaming InfoTech giants like Wipro or Infosys make fantastic national champions and headline grabbers, they ultimately employ a very small percentage of the arguably most elite workers in the country (between 1M directly to 5M indirectly ; for comparison, the US IT industry was roughly 7M people in 2000). Unfortunately, the median individual in the 3rd world is usually far from the education / skill level necessary for thes sorts of jobs. For these folks, a factory job that pays a regular wage is both more attainable and, due to the large spill over effects, creates a broader national economy multiplier. The problem, as the WSJ notes, is that the Indian economy employs a comparatively paltry 1 million individuals in the “Organized Manufacturing Sector” and dropping –

Part of the reason for such poor manufacturing sector performance are India’s notorious labor unions –

Battle lines are being drawn in labor actions across India. Factory managers, amid the global economic downturn, want to pare labor costs and remove defiant workers. Unions are attempting to stop them, with slowdowns and strikes that have led at times to bloodshed.

The disputes are fueled by the discontent of workers, many of whom say they haven’t partaken of the past decade’s prosperity. Their passions are being whipped up, companies say, by labor leaders who want to add members to their unions and win votes for left-leaning political parties. Adding to the tensions are the country’s decades-old labor codes, which workers and companies alike say require an overhaul.

“We can’t be a capitalist country that has socialist labor laws,” says Jayant Davar, president of the Automotive Component Manufacturers Association of India.

And the unions in part, draw their strength from License-Raj-style laws which introduce a “political loop” in an otherwise highly operational business decision about staffing levels –

Indian Manufacturing Workers

…The country’s Industrial Disputes Act of 1947 requires companies to gain government permission before dismissing workers… Manufacturers have long complained that it can take years to dismiss their permanent employees, leading to bloated work forces and hampering companies’ ability to respond quickly to changing business conditions.

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p>A separate NYT piece provides further details on this modern day License Raj -

Current laws still say that any company employing more than 100 workers cannot fire people without government permission, and the labor commissioner in the government has to be notified of every single person working on the night shift. In addition, no worker can be made to work beyond 75 hours of overtime a quarter.

Combined with militant politics, and an increasingly interconnected global economy, the results have started spilling over into other countries ; the WSJ piece provides some examples –

• this year, labor actions have hit manufacturers from Indian automaker Mahindra & Mahindra Ltd. to Finland’s Nokia Corp. and Swiss food giant Nestle SA.
• Workers at a unit of Korea’s Hyundai Motor Co. staged sit-ins in April and July, demanding recognition of an outside union and reinstatement of suspended workers.
• In September, workers at a unit of Japan’s Honda Motor Co. tried to prevent a trial of a new assembly line by threatening engineers and executives with shock-absorbers and motorcycle pieces, according to a court documents.
• Last year, the chief executive of Graziano Trasmissioni India Pvt. Ltd., a manufacturing unit of Swiss high-tech group OC Oerlikon Corp., was beaten to death by workers who had been suspended at a plant outside New Delhi.
• A strike that started in late September at Indian supplier Rico Auto Industries Ltd. left Ford Motor Co. without transmission parts, forcing it to halt production temporarily at an Ontario plant that makes Edge sport-utility vehicles and at a Chicago plant that builds Taurus sedans….The six-week Rico strike spurred GM to idle an SUV-production facility in Delta Township, Mich., for a week and cut one shift for a second week. GM also cut a shift at a transmission factory in Warren, Mich., said a person familiar with the matter.

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Needless to say, if I were an MNC thinking about investing in India manufacturing capacity…this would certainly make me think twice.

Most of the media coverage has, quite understandably, focused on Europe. But the tremors from Communism’s collapse were felt far beyond the immediate battlegrounds of the Cold War. The breakup of the Soviet Union had a profound impact on India. In many ways, it paved the way for a reinvention of the country

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Akash Kapur

While an important socio-political milestone, Kapur notes the equally important intellectual milestone – an event Francis Fukuyama memorably christened The End of History. History in this sense didn’t mean an “end to events” but rather, the (potential) end of a type of dialectical debate about political systems.

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p>It’s tough to remember now, BUT, prior to the fall of the wall, there were many serious scholars who seriously argued that not only would communist / socialist systems deliver greater equality than capitalism but also greater wealth . Their economic promise went a l’il sumthin like this – under capitalism the steel industry, for ex., might currently consist of 10 small, competing companies which are constantly hunting for cheaper labor to exploit, can’t all run their plants at max efficiency b/c of inter-firm supply/demand flux, and ignore other, more important social goals.

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p>“I remember, from my childhood, the Soviet engineers and scientists who filled the bars in Pondicherry, seeking respite from the rigors of the power plant they were building up the road. I remember the dusty bookstores that stocked cheap Russian classics and the bottles of sparkling Russian wine my father used to buy from visiting sailors.”Instead, why not gather some scholars & start with a top-down, national plan for how much steel “we” need? Then, build 1 big steel factory, have some PhDs calc how to run it at maximum efficient scale, eliminate “wasteful” expenditures like marketing budgets, commissions for sales forces and particularly those evil profits & exec-bonuses. And “we” can achieve important Social Ends like hitting female/minority employment targets, insulating employees from the vagaries of the employment market, sourcing coal from underserved regions of the country and making sure no one makes more than 2x the lowest paid employee’s salary. Lather, rinse, repeat for all other parts of the economy and poof! we’d all theoretically be better off.*

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p>Of course, the fact that we (well, most of us) now get a hardy laugh out of the idea that the Soviet system could somehow lead to greater wealth is indicative of the degree to which History, in Fukuyama’s dialectical sense, has ended. We instead generally accept that the troika of Liberalism, Democracy, and Capitalism (LD & C) are the right big picture features of a socio-politico-economic system and most debate is instead about comparatively fine grained variations of the theme. Simply put, workers in the first and developing worlds aren’t quite circling the capitol in tractors with raised pitchforks like they did back in the day.

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p>Meanwhile, in India, Nehru/Gandhi did OK on L+D but were pretty actively opposed to C…Kapur’s piece provides some great examples – big & small – of how, despite official pronouncements of non-alignment, India truly was on the wrong side of this History -

India was never a Communist country. But it was far closer to the Soviet Union than to the United States throughout the Cold War, buying weapons on concessional terms, doing barter trade with the Eastern Bloc and receiving financial and technical aid for industrial and infrastructure projects.

I remember, from my childhood, the Soviet engineers and scientists who filled the bars in Pondicherry, seeking respite from the rigors of the power plant they were building up the road. I remember the dusty bookstores that stocked cheap Russian classics and the bottles of sparkling Russian wine my father used to buy from visiting sailors.

It Brought Down Mental Walls Too…

There were many reasons for the closeness between India and the Soviet Union, not least of which was a U.S. foreign policy that tilted decisively toward Pakistan. But the closeness was born, too, of genuine ideological affinity.

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p>At about the same time the balance of payments crisis was prompting India’s 1991 economic reforms, the Soviet Union was collapsing. While many of the reforms were arguably inevitable (the Indian state was truly running out of other people’s money), the fall of the Wall provided the important intellectual “cover” for enthusiastically pursuing reforms -

It’s possible that all of this would have happened anyway, with or without the dissolution of the Soviet Union…Most important, the death of Communism had a psychological and intellectual impact that paved the way for India’s transformation. As the economist T.N. Srinivasan (among others) has argued, it provided an opening for would-be reformers, who had already recognized the need for some form of liberalization but who had run up against ideological resistance.

The collapse of the Soviet Union wasn’t just the collapse of a political and military behemoth. It was the collapse of an idea, too, and with the discrediting of Communist ideology, Indian socialism, long the guiding philosophy of statecraft and economic policy making, confronted a crisis of confidence. Ideas that had until then been anathema to the nation’s governing class — ideas about markets, about profits, about entrepreneurship — suddenly seemed, amidst the detritus of Communism, to be incontestable.

It’s hard to remember now, after the spectacular market failures of the last few years, but policy makers in 1991 were operating at “the end of history.” Capitalism wasn’t just a superior model; it was the only viable one.

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p>And so, perhaps the biggest reason India couldn’t have liberalized sooner was plain old ideological inertia. Unfortunately, the cost of waiting to abandon those socialist ideas now appears to be 14M infant deaths, 260M literate individuals, and 100M folks who missed the opportunity to rise above poverty…..

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*alas, the same sort of “the top-down plan = efficiency, lower costs + cut out middleman profits = we’re all better off” thinking underlies many of the proposals in the US healthcare reform debate… so I suppose there’s still a lot of room to debate just how closed the verdict is on History….

Arguably, while many of the most famous what-if’s focus on chance events in history, prominent Indian econ journalist Swaminathan Aiyar, writing for the Cato Institute, decided to take on a far more considered, deliberate economic policy “what-if”. He asks “what if India liberalized its economy 10 yrs earlier?” Put differently, what if 1970s India followed the economic path pursued by Korea, Japan, and Taiwan?

Until the 80s/90s rounds of liberalization, India followed a Soviet-inspired economic model resulting in stuff like this –

India’s per capita GNP growth was only 1.49 percent in the three decades from 1950 to 1980. In this period, socialism was the avowed policy of the government, the peak income-tax rate rose to a record 97.75 percent, several industries were nationalized, and the government sought to capture the commanding heights of the economy.

To answer his alternative history question, Aiyar does two interesting things. First, instead of trying to come up with a hypothetical “Korean policy mapped to India”, Aiyar simply remaps the growth rates across different decades within India itself –

This paper considers what would have happened if reforms had begun in 1971. It projects an early-reform, high-growth scenario in which the per capita GNP growth rate in each decade would have been as high as that actually achieved one decade later. That is, this scenario envisages that the trend per capita GNP growth rate actually achieved in the 1980s (2.89 percent per year) would have been achieved in the 1970s; the trend rate actually achieved in the 1990s (4.19 percent per year) would have been achieved in the 1980s; and the trend rate actually achieved in the early 21st century (6.78 percent per year) would have been achieved in the 1990s.

While there are a hundred possible issues with remapping growth rates like this, I think Aiyar’s approach is likely the “least bad hack” for estimating some numbers.

Second, while growth rates and their inherent compounding are important academic subjects, they leave the lay audience a little, shall we say, underwhelmed. So, Aiyar mapped those growth rates to a few classic human development indices – infant mortality, literacy, and poverty rates – to guesstimate what the India of today might look like –

…with earlier reform, 14.5 million more children would have survived, 261 million more Indians would have become literate, and 109 million more people would have risen above the poverty line.

As Aiyar notes, even if a later, more sophisticated model cuts his projections by half, these results are still in a league of their own. These numbers dwarf the proposed outcomes of even the most optimistic charity / foreign aid / econ development / govt-led initiative / NGO / UN program in existence and demonstrate just how pervasive & important bottoms-up GDP growth is for a population. As Aiyar concludes –

The delay in economic reform represents an enormous social tragedy. It drives home the point that India’s socialist era, which claimed it would deliver growth with social justice, delivered neither.