Bad policy: short-term handouts trumping long-term growth

How would you go about entrenching poverty in a primarily rural, formerly agriculture-dominated tropical island economy?

Your land is blessed with two monsoons that almost split the year perfectly in two, interspersed with inter-monsoonal rains. You have diverse agro-ecological zones, and what's more those two monsoons approach your island from diametrically opposite compass points, spreading the water wealth. Your people are inheritors of centuries of vast public irrigation works that have conquered any imbalance in water availability, bringing liquid gold to the most fertile and agriculture-friendly parts of the island.

Let's assume you already have highly fragmented landholdings due to weak land markets, previous cock-eyed land reforms and a lot of inertia around more meaningful reforms. People with handkerchief sized sub-scale plots can't sell their lands due to unclear title or worse, arcane regulations. Rational land allocation is distorted by regulations that forbid any use but agriculture, sometimes of specific crops (ref. self-sufficiency) - you can't even  grow something the market might actually want.

Coddle local producers to the point of inefficiency with populist import protections, price controls and astronomical, unsustainable input subsidies (which by one of my calculations almost completely wipe out the GDP contribution from paddy); then cut them loose and bring in cheap imports when prices spike just ahead of the local harvests (or near elections) - depressing prices for everyone and killing incentives in local agriculture. Once in a while try to bring in a guaranteed-price centralized purchase scheme to repeat dramatic failures of the past. Big farmers want to cut their losses, small farmers just revert to subsistence, turning away from the vagaries of the market. Value-adders lock up their expensive (imported) machines whose output cannot be sold at a fair price thanks to the controls.

Self-sufficiency is one double-edged sword to swing around too much. The food shocks of 2008 provide an easy stalking horse for all kinds of protectionism taken too far. All kinds of marginal lands start coming back under cultivation, some of it just for subsistence, all competing with the "high-potential" zones that should be left to cultivate commodities efficiently - and cheaply - without specializing into higher-value crops or away from agriculture altogether.

There's no easy fix of course. Most of today's marginal lands were the agricultural heartlands of yore, sometimes by accident, sometimes reflecting the changing state of the art in technology. Like in Japan, agriculture, particularly rice, is embedded deep in our souls, and can't be turned away from easily. Few other alternatives exist - development in held back by isolation in its many forms; roads, technology and education have taken the longest to penetrate - and make an impression - in those same areas.

With an end to conflict, the clock is winding down on inefficient land allocations - if we don't get smarter about what we grow, where, farmers around the island will be faced with harvests they can't sell. Can we get markets working in time to keep the right farmers growing the crops best suited to their lands (and all the handicaps we can't dispense with overnight) - and to the market opportunities out there?

Don't like your score? Change the rules (again)

Sri Lanka's rejiggering the main price index less than two years after the last blatant wool-pulling exercise. This time they're even dropping alcohol and tobacco from the basket, clearly choosing to believe their own fairytale that temperance can be enforced - and apparently has been achieved - with the help of a few TV spots and millions of posters.

I heard that an old journalist (maybe too old to care anymore) had interrupted a Buddhist monk trotted out to sing the government's praises in decidedly non-secular areas, asking what exactly the reverend was celebrating, given that the reporter had just been to one of the lavish vote-buying parties at the Palace where the drinks flow freely.

Another little birdie tells me His Highness had nudged and winked away the concerns of a delegation from the meat industry about the similar blanket ban on slaughtering with "don't worry about all that, we also must have something to eat no!"

Finally, an unintended consequence of a blanket ban on animal slaughter (keeping in mind that I am personally against the taking of lives but also willing to step back and think of wider consequences): Apparently a commercially viable dairy operation needs to cull 20% of its herd annually, something one large operator has already had problems doing thanks to enthusiastic preemptive rent-seeking despite the anti-slaughter bill only being in proposal stage. So, overnight blanket ban on slaughter --> further reduced local milk production --> more imports --> less foreign exchange, and more reasons for the propagandists to squeal about foreign conspiracies - except in this case too, the problem is local, not foreign.

Dud bridges? Check. Private Presidential Palaces? Check.

I saw some TV coverage of this talk a while back - which also shows how long my backlog is(!)

Small groups pushing policy without evidence - sound familiar? Where are our median voters? How come they don't push for the kind of sensible reforms for which "a fair amount of consensus" apparently already exists, in "education, labour markets, land markets, and achieving macro-economic stability and better public spending?"

I suspect the median voter has had to rush wholesale to hang on to the Satakaya-tails just to survive, maybe angling for whatever infrastructure contracts the Chinese didn't bother with, or hoping for scraps from such long-term empire-building as the Deniyaya Raja-pasa-plex (new definition for PPP: Private Presidential Palace?)

A friend on holiday from the original home of the Land Rover observed over the weekend that one has to come to Sri Lanka to see tricked-out Land Rovers of every flavour hammering around - mostly on Colombo's streets of course, rather than the moonscapes all the ostentatious accessorizing implies they're meant for. I even saw an LR3 sporting a snorkel and winch - and the requisite garage plates - the other day. The cheap-and-cheerful Mahindras and Tatas seem long forgotten - good thing Land Rover is nominally Indian now - more than enough for Comrade Vimal to spin another set of rationalizations (wait - didn't he hate the Indians? Or was that last week?). Even the bald-headed, aisle-crossing Minister who pretentiously went around in a Hindustan Ambassador when he was in the last government came away from launching his own political party (better than admit defeat and go back whence he came) dispensing Justice in a shiny silver Jaguar.

Has the median voter evolved, throwing in the towel and joining the mad scramble to feed on the carcass? If the median voter has in fact had to become a opportunistic, carrion-feeding pragmatist in a ridiculously politicized society, what hope does that hold out for a "brighter future" that we all apparently still hope for, the past four years apparently not having been bright enough?

Do we really have a silent majority that might, juuust might, this time actually make the trip to the voting booth and send the Scamtastic Four and their friends and family back to their upgraded or brand-new homes to try and get by on the fortunes built up over the last four years? Tough ask, I would say, given the stranglehold on the state machinery and the scale on which it is being mis-used - why risk one's neck to put pen to paper when there are many goons happy to do it for you?

If we as voters do in fact come out of our stupor and topple the four-headed beast (wrong part of the anatomy? Many-pocketed, for sure) it's not like the journey's over. Better almost anyone than this clan, the past four years should tell us that. But we voters must keep the pressure up for the vital promises to be followed-through, for once. We must get up off our welfare-softened backsides and maintain a firmer hold on our elected servants (with less prostrating before them for a start) with clearer causality between good or bad policies and the political outcomes we voters alone should be able to decide.

It's time to step up to the plate.

New music video business model?

Has the music industry stumbled upon a new model to finance music video productions?

Over the last few months (hey, I don't watch much TV) I've noticed some pretty sly product placements in Sri Lankan music videos, to the extent that there is clearly some money changing hands here. Not a bad thing, considering how small the local market is, and that most of the music is pretty good, and pretty creative too. Here are just a couple; check out the related ones too:

Ashanthi:

• a womens' health supplement (? the pills in the purple box)
• a new fizzy drink being heavily promoted
• Mercedes might be a long shot, and Hummer an even longer one - I'll chalk those up to de rigeur rap-video props [later update - turns out the Hummer may have been a product placement too; I love how Sri Lankan companies brashly crown themselves "#1," "world's leading," etc with doubtless no evidence whatsoever]
• just to editorialize, I thought the little laptop face-off between Ashanthi and the rapper (DeLon?) was cleverly done

Iraj

• An European three-wheeler competing with the Indian brand
• another fizzy drink promoted as an essential accompaniment to any meal (perfect as this song is about food!)
• Other videos by Iraj have featured cellphone operators, fizzy drinks from the same manufacturer, and, not sure about this one, match manufacturers?

A while after I'd started on and forgotten this post, I noticed quite a bit of product placement in a Pussy Cat Dolls video too, and, in the interest of science, watched a few more to turn up some more such as

• Nokia, HP, and Campari in Hush Hush; Hush Hush
• Gratuitous Nokia in Jai Ho
• and now, when I look back, in most of their videos I guess

Politics and Rent-seeking

Departing from more mainstream (and mostly pretty good) rap in Sinhala, Tamil (with the help of friends), English and combinations thereof, Iraj has come up with an interesting commentary on the the local political marketplace.

Out of jail with no place to go? Go to work as the local politician's enforcer, putting up posters, stuffing ballot boxes and impersonating dead voters. Need protection from the few cops actually doing their jobs? Foot the politician's bills and see your problems evaporate. And the politician's take: I got here the hard way, and I ain't going back, whoever I have to kill.

Naturally one needs money to beat all the other low-lifes fighting to get a toe-hold on the elevator to power and rent-seeking heaven. Money in amounts one doesn't have, hence the need for even more rent-seeking, just to pay pipers, before one can set up one's empire, and, I don't know, say,

• make one's brothers one's personal advisors,
• employ one's family members, classmates and neighbours in key positions in the state machinery, ridiculously politicizing every institution as well as state-owned businesses
• educate (or try to, anyway) one's sons on taxpayers' money, take over - almost at gunpoint where necessary - all the reasonably profitable-looking businesses that are unfortunate to catch one's eye with their success
• or just start a competitor - say, a security service head-quartered on state property (seen it with my own eyes), and issue circulars "strongly advising" all state institutions to start employing one's own firm
• wine and dine just about every sector of society (which only the tax-evaders must really enjoy, since the taxpayer is after all footing those bills too)

Of course you can't take it with you, but who cares in a land of short memories and short-term thinking, particularly as your most potent infliction upon your country - your family - can hang around to fight over the carcass for years to come

Queueing Theory

Has anyone analysed the basic ability to form and honour a queue as an indicator of a country's level of development - or just plain education?

We Sri Lankans can't queue for toffee (in fact, if you plan to offer a toffee, stand back and be ready to call for ambulances and riot police), which, taken as a proxy for "education," would clearly show the difference between literacy (oh what wonderful - declining? - literacy rates we have!) and education.

"The trouble with markets is..." unintended consequences in slum resettlement

The last para of this article is a sobering reminder that markets don't always behave as we expect them to. I've heard of similar experiences in Sri Lanka too. Nothing wrong with it in principle, right, with individually profit-maximizing actors/families. Just doesn't move people out of the slums for long. Maybe some of them are used to conditions well enough to much prefer tolerating the slum while enjoying an additional (year-round, stable) stream of income. I'd even guess (there must be research on this) that many slums spring up because they're the cheapest accommodation close to certain labour markets.

I remember driving past Kibera while working on the automation of the Nairobi Stock Exchange's Depository & Settlement System. I also remember wordlessly watching from my electric-fence-and-guard-dog -protected flat window the silent flood of humanity that begins at the crack of dawn as low-wage workers start their sometimes hours-long treks in to work, too poor even to afford a matatu bus/minivan.

Postcards from the Base of the Pyramid

Snapped this on my phone in October, found lying in a pile of rubbish (not cool) in Magam-Tissa, between Kirinde and Bundala/Hambantota.

Technical digression: Two-stroke three-wheeler/autorickshaw/tuk-tuk engines need the right amount of 2T engine oil mixed into their petrol/gasoline tanks (no separate lubrication cycle etc). Hence the extra pollutants spewed into the atmosphere too.

Back to BoP stuff: In urban petrol/gasoline sheds you see a "buddy" Coke bottle sitting on an engine oil dispenser next to the petrol pump. This is precisely to measure out the amount of 2T engine oil needed when a three-wheeler/autorickshaw/tuk-tuk driver pulls in to pump some gas.

Well someone at the state-owned Ceylon Petroleum Company has either used his brain (hooray) or stumbled upon a clever BoP marketing strategy (ok, not so great for the environment, like the sachets etc the soap companies sell). The sachet holds 40ml of 2T engine oil, apparently, according to the packaging, the right amount to per 1 liter of petrol when topping up your cheap-and-cheerful three-wheeler - the BoP's ubiquitous, do-everything, go-almost-everywhere workhorse.

Digression on sachets and BoP marketing - I keep asking people I know at Unilever whether anyone has figured out the environmental impacts of all those Lifebuoy river-baths and Sunlight laundry days in our nation's waterways, lakes and tanks/reservoirs.

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Luckily for my bank balance, it's not GSM...

I haven't been following the handset market, but this sure looks like a winner. I personally liked the RAZR and used it for years - it did was it was supposed to do, and well - but looks like Engadget doesn't

Powerful words

Wow... Pay attention to ~03:50 onwards especially (Thanks Senura)
Reactions? Comments?

Conclusive proof he's a Sri Lankan

At least the London Bobbies made a fast (excuse the pun) buck out of this one.

The boy would have fit right in with the local university strikers leaving the taxpayer-funded lecture halls - but not their stomachs - empty.

Wolverine goes green

Join the band wagon? Why not - it's the only game in town

Just found out that the club I play water polo at - Otter Aquatic Club (map) - is another victim of the hoopla around the Army Tattoo at the nearby Bandaranaike Memorial International Conference Hall (BMICH). The entire stretch of main road - around 1km by my estimate - had been closed off to all traffic since the shindig started. I had seen a notice inside the club that parking restrictions at the club would be tighter during the event (it's a nice little perk to be able to park one's car there and stroll over to the more popular events).

Today I hear the entire club has been sealed off - no practices, let alone boozing, snooker, squash, tennis, badminton, rustifying (did I mention boozing?) or anything else that usually goes on there.

The Rubicon had its uses...

[unpublished from 3.5 months ago] A future more like a past I barely knew

[I was looking another draft when I realized I hadn't published this, started June 19th 2009. Will not edit it further. General idea I had at the time: returning home after some tumultuous times, hoping things can return to something close to what they were]

One week more before we get on a plane back home - back to Sri Lanka. Finally some downtime after the treadmill of Business School; the fire hose is finally down to a trickle.

Hanging out at my aunt's place in Los Altos Hills, lucky to have my parents around too as well as my wife. Finally back to being able to read for pleasure alone. Of course it's a chance to devour some of the modern Sri Lankan literature lying around here, that four years of undergrad, five years of work and two years of business school made it too easy for me to never get around to.

Shyam Selvadurai's editor (Cinnamon Gardens) needs to be fired of course - how could he have let Galle Face Green - and Colombo, by extension - be moved lock stock and barrel to the East Coast, for Annalukshmi to watch the sun rise over the sea?!

I'd started Michael Ondaatje's Running in the Family on a rare break at a friend's place in LA (for those who know him, never expected Sajith W. to have literature on his shelves - other than maybe the variety with yellow pages!!) and immediately felt a strange nostalgia for a time before my own, for an ideal, not even a country, that represented some of the best of our enchanted isle.

Google Ads starting to scare me

I just mentioned fumes from kerosene lamps in my last post - and Google Ads served a link to a toxic gas sensor. Cue spooky music...

Sri Lanka on the BBC World Challenge short list again

A few years ago it was the elephant paper project, now it's the safe kerosene lamp project. Makes for an interesting comparison with D.Light. On one hand you could say D.Light leapfrogs the issues such as continued reliance on kerosene, fumes, remaining probability of fires; on the other the bottles would be cheaper to produce/sell/sponsor/distribute and require almost no behavior change.

If you needed a reason to do your job properly...

The present government made a big fuss about clawing back some of the bus transportation system some years back, painting them in the government coalition's livery. The main colour on the buses is red - the colour of the nationalist/Marxist/whatever-sells-right-now minority parties, embellished with a blue stripe in the "main" Sri Lanka Freedom (maybe not for much longer the way we're latching on to China and Iran) Party's colour. The tail wagging the dog? Not that unusual among Sri Lankan canines.

Translation of the text on the back of this state-owned bus: "The employees of the Sri Lanka Transport Board's Udahamulla Depot rehabilitated this bus in honour of His Excellency (you know who)'s completion of two years since ascending to his position."

Nice to know they still have reasons to do their jobs.

Another picture I wanted to take is of the row of such buses - more than 10 - parked along Green Path, obviously commandeered to transport large numbers of people for some political purpose. Turns out they're entertaining people in the thousands - driven up, not to mention fed and watered, at state expense - at the official First Residence ahead of the provincial elections coming up Down South. Talk about distorted political markets. One would want to avoid a possible rout in one's home province, after all - despite the shenanigans that don't seem to have been working too well.

My wife saw me writing this and "please don't get taken away."

Schumpeter (column in The Economist): The pedagogy of the privileged

Surprising they didn't mention Stanford GSB and the New Curriculum; Particularly when they mentioned Nick Bloom and John Van Reenen's work (I took their class on their research, which I'd followed since I sat in on Nick's presentation ahead of SAIL 2007 (that's me front extreme left in the picture with the Infosys pyramid!)

Schumpeter: The pedagogy of the privileged | The Economist

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Pulling the ladder up after them

State-educated (free ride all the way) doctors laying siege to the University Grants Commission demanding that the new private medical school project be denied (the buildings are already up opposite MillenniumIT in Malabe).

Expand opportunity to a wider base, overcoming the funnel into limited State universities that distorts the education system - if not the entire economy? What horror! What would become of the Chosen Few, such Brahmins as these, insulting their white coats as they hang on fences?

"Should people working in development have developing country experience?" Not even a question, to me

Ken Banks asked the question, and I had to add my two cents' worth (in comments).

"YES to developing-country experience for development workers - ideally in the same countries/regions they will work in - and with the demographics they will be working for (note I didn't say "with"). I firmly believe you need to feel the mud between your toes and get to know at least a few members of your demographic on a personal level. That empathy and depth of understanding can change what you do - and how you do it." Maybe it just seems more obvious to me because I come from a developing country myself - and have seen too many projects that fail to account for even the most basic local appropriateness - e.g. in Sri Lanka, lovely, airy buildings with tiled floors and wood panels - which become roosts for hundreds of crows, in the intense heat and humidity end up with warped grouting and paneling, and come the two monsoons, cannot be navigated without gumboots and umbrellas. The saddest thing about that example is that just because you donate a building, should not mean you cannot hire a local architect at least as a consultant, if not your main architect.

Ideators - Apprentice-style show with some twists

As I type I'm watching British and Sri Lankan university students in a Sri Lankan Apprentice-style show sponsored by the British Council (on ETV, for those in SL).

Yes, I cringed, more when watching the old-school corporate guys trying to tune in or - alas - communicate (through no fault of their own - will save that for a later rant).

But hey, they were out there on the streets, the corporate guys obviously had to wrap their minds around something new, and the presentations seem to have had some good analysis behind them - profit margins, demographic preferences, lateral thinking. The Sri Lankan students more than held their own - and this experience will hopefully stay with them as they go out into the workforce - hopefully the Sri Lankan workforce (separate rant alert)

Beating malnutrition - it takes a village

Nicely done video, although it's focused on India - which makes sense I guess, if you apply the Pareto rule.

Question is, why is Sri Lanka, which is the best among the worst (see the graph) sliding back up in the numbers for stunted growth?

Welcome to a country with first-world health indicators and third-world "leadership." I only hope we can prove conclusively that maintaining good health indicators is not an either-or choice for a developing country while it gets the rest right. Along with all the other interventions (Embrace is part of it, as are the many nutrition efforts) increasing incomes - sustainably - has to be one of the ways to help break the nutrition trap at the bottom of the pyramid.

http://go.worldbank.org/YKEOSEOAQ0

Community-Driven Development

We've had a name for it for a long time - "Shramadana" (lit. "donating one's labour") but it's good to see that people still see it as an option. Of course it can get messy and political, but that's a function of the group involved and how serious they are about the issue that needs fixing. A little principled leadership wouldn't hurt, though that seems a precious commodity these days

http://go.worldbank.org/QYYSWHNBP0

Save him from the White Vans

One could laugh at the "hypothetical" situation of the minister of agriculture controlling the biggest rice mill, or the opposition protesting fiscal responsibility and a balanced budget... but for how long?

http://www.lbo.lk/fullstory.php?nid=1359486271

Sabbe Sattha Bhavanthu Sukhi Tatta - May all beings be happy

I was heading home after an early morning friendly water polo match today. My wife wanted me to pick up 2 'Maalu Paans' (triangular buns with a fish-based stuffing) for the daily help who would be coming to help clean house. As it was on the way and, I thought, an opportunity to feed someone without perpetuating the cycle of killing some poor animal to replace the flesh I might otherwise have to buy, I stopped at the hole knocked into the wall of the All-Ceylon Buddhist Congress (ACBC) on (of course) Baddhaloka Mawatha ("Buddha's Light" avenue).

Diya Rakusa: You have veggie stuff, right?
Salesperson: No, everything's non-veg except for the seeni sambal buns.
Diya Rakusa (after taking a step back to check the shop sign): This is the Buddhist Congress, right?
Salesperson: Yes, but evryone asks for fish...

Of course if that shop is supposed to make any money for the ACBC they must respond to the market. Right? But what about the basic principles of non-violence or the First Precept of not taking life? I don't consider myself any great Buddhist - I'm still working on the basic first five precepts - but shouldn't the patrons of that ACBC shop think twice before going there looking to lock not only themselves but the salespeople, bakers and fishermen into the same karmic cycle that they then spend a good amount of time and money trying to pray their way out of?

Don't even get me started on the buses proclaiming "mey Bauddha deshayai", the clerics who don't seem to preseve the first five precepts let alone their stricter super-set... Wake up and smell the holy abattoirs

Start somewhere!

Been too long avoiding blogging etc - felt it a distraction from what I should be doing but something happened that I thought deserved a little rant.

As an update, back in Sri Lanka for ~2 months now, working on a Social Innovation Fellowship from Stanford's Center for Social Innovation. More on that later - when we're out of stealth mode.

The Thinking Man’s Rapper

Spring Quarter of my second year, and Stanford GSB outdoes itself again. M.C. Hammer guest-lecturing in the Building Innovative Brands class – how do you outdo that?

Hammer was extremely approachable and gracious, taking photographs with everyone and joking around as the earlier class trickled out v-e-r-y s-l-o-w-l-y, until Prof. Aaker had to call a group photo and get us in our seats (That's me behind Hammer's right shoulder :-)

Hammer just impressed me so much with how on top of things he is, and how strategically and thoughtfully he approached every aspect of marketing – starting with his early days launching his first album in 1987, selling records out of his trunk. I was eight years old at the time (!) Hammer may well have come through GSB Executive Education, he seemed to hit on every major point Prof. Aaker has been taking us through all quarter – this guy is just a natural Social Media marketing machine. 2 Legit 2 Quit.

Takeaways and priceless quotes:
Every thing you do can be used to craft your brand, to “create and control…perception.” E.g. his first song, “Let’s Get it Started,” answered in the first verse who he was and why he was there – “put on the Hammer” and he would help you p-a-r-t-y. His first video was as much a “commercial” for the Hammer brand as anything else. He looked outside the industry to find a hot new director who would understand Hammer’s desire to capture the energy of his moves.

Get ahead of the curve. Hammer got curious about the Internet early (’94-’95) and went looking for whoever would help him realize the vision he saw for it. Silicon Graphics, Apple, YouTube (when it was two computers above a pizza place), what have you.

Web 2.0 gives you an important tool - the ability to humanize yourself, reach your audience without intervening layers, and immediately and directly counter less direct forms of negative media.

The way to push your brand is to put it in the hands of very creative people. Create a groundswell, word of mouth.

“Every superhero must have one” – Hammer on Will.I.Am’s song for President Obama

“I have 20/20 vision – I didn’t need glasses – I wore them for you to see me better” - Hammer on why he wore glasses when performing

“Never apologize for your success. Just tell the other guy he’s gotta work harder”

Google Street View: Isn't this guy jaywalking?

I remember an article about police using Google Maps to arrest someone in the UK. I was trying to see what the Embarcardero MUNI station looks like in real life (backstory - bought cheap tickets through the GSB Athletics Club for the SF Giants-NY Mets game, taking wife and parents right after wife's graduation ceremony) and I see this guy immortalized on Google Street View - at least until the next refresh...


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Farmers First Foundation

Had an interesting chat with Amandeep Gill, a founder of the Farmers First Foundation, Indian Foreign Service (been in Sri Lanka for a while) and a fellow at the Center for International Security and Cooperation at Stanford. Check them out.


View my page on Farmers First Foundation

Lahore violence against Sri Lankan cricketers

What a cruel blow to Pakistan and cricket fans everywhere. Just a couple of hours ago I left a speaker event on Pakistan with optimism for its future. My Pakistani classmate Osman Khan emailed me, the first I knew of it, saying "I am sorry about what happened in Lahore today. It is sad that my country has come to a point when friends of Pakistan are being attacked. When no one was ready to tour the country, the Sri Lankans came-and this is what happened."

A dark day for all concerned.

http://news.bbc.co.uk/1/hi/world/south_asia/7920272.stm

The Grandmaster hits the Blogosphere

Andy Chan, the Grandmaster of Career Advice and Wizard of the Career and Life Vision seminar, has hit the Blogosphere. Oh, and he's also the GSB's original Ricecake :-)