Lev Pake Reste Turns 10

Yes. Already. A recap. So Ramgoolam nominates Bheenick as Governor -- one of his best decisions ever but that too after a year and a half of doing God knows what -- but Sithanen is unhappy so he threatens to resign or maybe he does. The PM is out of the country at the time but makes an appeal to the Minister on national tv. The latter eventually changes his mind -- after about a week -- when his pick as the BoM chief gets the SBM chairmanship. But not before swallowing something that's not exactly a grass snake and creating an urgent need to amend one famous Chevenement formula.

That was a really strange week. See if a Minister cannot be present at his office there has to be a colleague who steps in for him. We've seen this so many times: another member of Cabinet will answer parliamentary questions on behalf of the officeholder when the latter is out of the country. If a Minister resigns our excellent constitution takes care of that seamlessly. And that too without the PM having to be at his desk. The Ministry can also be reassigned to another colleague. For example SAJ held the Ministry of Finance for a few months last year. So did Ramgoolam in 2014. But none of those happened back in February 2007.

Von-Mally's Choice Reveals Why Party Lists Shrink Democracies

Lists to Party

Check the party lists for the ongoing Rodrigues Regional Assembly (RRA) elections and you will find the Leader of the Mouvement Rodriguais (MR) sitting at the top of his. That could be a lot safer for him than contesting one of the 12 FPTP seats especially if the MR doesn't grab too many of them. Which makes it more difficult for voters to dump Mr. Von-Mally. See you needed at least 48.19% of the local region votes in the riding of Port-Mathurin to get into the Regional Assembly back in 2012. A tad more than in 2006. Whereas all you need to qualify for a PR seat is that your party gets at least 10% of the island region votes and it doesn't get enough FPTP candidates elected. There's also another way Von-Mally could get in: his party grabs a majority of the FPTP seats but that majority gets neutralised by the PR seats. He would then go in on the first of the 3 extra seats that guarantee that the winner of the FPTP competitions forms the regional government.

An Inquiry into the Wealth of Two Tigers

What If

Let us assume for one second that Singapore had kept the value of her currency against one USD at its average rate of 2.2002 for 1985. Not a bad objective as combined with positive growth rates generated by adjustments in the real economy her people would have felt a lot richer when going abroad for holidays or to grab companies and ideas to move forward as a nation. If she had kept the value of her currency constant at that level then at the end of 2015 her GDP per capita would have been $33,047. Quite a number don't you think?

Thoughts on Electoral Reform (5)

Elections in Mauritius Are Seldom Referendums

Vote share doesn’t matter that much in Mauritius. We instead have competitions in 21 unequal ridings and the party which grabs anything more than half of the contested seats earns the right to form government. Our first-past-the-post (FPTP) setup is a system which works and has served us really well. And that too for decades. Making it an important part of who we are. Just like progressive taxation and a high savings rates have until 2006. Important matters of the state need to be given the appropriate consideration. It’s definitely not a bad idea that we let ourselves be inspired by examples of profound thinking. Like what Feynman told us about hardware reliability of the Space Shuttle: the necessary redundancy was provided by several independent identical computer systems.

Plenty to Learn From US Election Process

Americans know pretty much what to expect from the person they will elect as President of the world's second largest economy today. And that's thanks in no small measure to the candidates thoroughly discussing the main planks of their plans and to several independent groups of people scrutinising them. If it's Trump they are aware that the extreme version of trickle-down economics he's proposing – a flat tax of 15% – would add 5 trillion dollars to the US national debt, make 3.5 million people lose their jobs and potentially throw the economy into a recession. If it's Clinton the economy should keep on growing from the middle out and that too without a Great Wall that Mexico would be made to pay for. The fiscal policies of these candidates are also consistent with the DNA of their parties: Democrats don't believe and rightly so that tax cuts for the wealthy work while the Republicans do.

Thoughts on Electoral Reform (4)

At 60 miles an hour the loudest noise in this new Rolls-Royce comes from the electric clock.

David Ogilvy headline

We Already Have the Rolls-Royce of Constitutions

Our constitution through its excellent First Past The Post (FPTP) system has enabled voters to proceed with five seamless changes of government since independence. Three of which happened after consecutive elections. And most of our governments have been stable. This has been a key ingredient for our early successes. Our FPTP system has allowed us to focus on solving difficult problems which many back in the 1960s had rightly considered as almost unsurmountable. We also appreciate the quality of our constitution when political alliances break down: new ministers are appointed swiftly. And when we see how the absence of a good enough constitution in other countries hold them back. But it's not perfect. It has a slight clicking sound. Which needs to be corrected soon. In a mindful fashion.

Une nécessaire réforme de notre système politique: A Note

I have a few comments with respect to the points made in this article which appeared today.

1. We are prisoners of the two-party system that the FPTP generates. We don't have a two-party system here but most elections have been dominated by two alliances each made up of two or more parties. Our political system has been quite dynamic if we look at the weights of the different parties on the political chessboard over time and in the different alliances at voting time. It has also been renewing itself. Maybe not at the speed we would have wished though.

Lepep Budget May Miss Boat, Again

Budget Doesn't Address Dominant Issue

Namely the extensive damage caused by the flat tax: 1. a massive GDP gap; 2. a serious impairment of our domestic savings; 3. making Mauritius less competitive and dynamic by keeping local pump prices at unreal levels and 4. generating the smallest increase in real disposable income for the poorest 20% of households of the last twenty-five years. Besides the flat tax was implemented on the basis of spurious claims.

Why Poverty is Winning

Because so much of it has been created over the past 10 years. Some people have been getting out of poverty for sure but a lot more have been falling into it. Of the pool of 126,200 poor people in 2012 a staggering 33,000 had joined it over the last decade. That's more than one in every four poor Mauritians. This has happened because our economy has not grown fast enough and whatever wealth was created has not been shared properly.

Massive Policy Failure

Which in turn has mostly been caused by dismal policy-making and the lack of dynamism of our economy. External events have certainly played a role but given that they were beyond our control we shouldn't have spent that much time crying over them. We should also acknowledge the fact that there has been a wide variation in the way poverty has expanded. Chart 1 captures that by looking at how it has progressed over a fifteen-year period. Which coincided roughly with three different governments and in one case with major policy changes.

Will the Budget Be a Non-event?

"On ne parachute pas au ministère des finances quelqu'un qui ne sait pas calculer la dette publique et qui ne connaît pas l'impact de la fiscalité sur la croissance...."

Rama Sithanen, 2009

Like last year's and most of the budgets since 2006? Well, it doesn't have to. It will essentially depend on a single decision. But first let us understand how we got into a deep mess for ten whole years.

Old Policy Crap in New Bottle

The last part of the quote above – emphasis mine – summarises pretty much the main economic story from Mauritius over the last decade. While tax rates definitely impact growth rates – and both of them drive government revenue – the relationship is far from being linear. And it depends to a great extent on the relative ability of our public and private sectors to create wealth or make things happen. In the 1980s for example, as Paul Krugman reminds us, American top tax rates were cut from 36.5% to 26.7% over nine years but they never got the growth rates that would have financed those cuts. What they did get though is a Federal debt ballooning all the way from less than a trillion dollars to four by 1992. And two decades later US politicians were trying to clinch a deal hours before Uncle Sam was scheduled to go into default. The Economist summed up the situation as essentially the product of two tax-cuts, two wars and one stimulus package.

Why Mauritius Need Not Worry About Brexit

Because we got far more important issues here to worry about. Here are a few.

1. A Minister wants to sell the CWA because he's not happy with its hotline. Now, if this is not a cause for worry and a reason for ministerial resignation, an urgent Cabinet reshuffle, a referendum or all three I wonder what is. Another Minister wants to sell the CHCL. That's totally inappropriate. Talks with DP World have to be immediately called off. We can keep on nicely developing our port by ourselves -- CHCL has invested nearly Rs2 billion over the last ten years. We've got the people and tons of unemployed graduates who should be given many opportunities to push Mauritius forward. For sure we could have done a lot better had Sithanen not messed up our savings rate and economy so badly with the impressive string of failed policies which have accompanied the worst form of trickle-down economics: a flat tax. See, he promised robust growth rates of 8% back in 2005 if we lowered top taxes. As the chart illustrates we not only never got anything higher than 6% during the past 10 years but 60% of those rates were under 4%. This has, as expected, caused our government to run out of money for capital projects -- which Badhain keeps repeating -- and pile up a lot of debt. Making us a lot more vulnerable at the same time.

Vishnu Will Not Deliver A 'Second' Miracle

Because he is now Minister of Foreign Affairs. He was unable to deliver it in 15 months which by the way is exactly how long Pravind Jugnauth was FM in the third Bleu-Blanc-Rouge government. And just like Mr. Lutchmeenaraidoo the leader of the MSM had promised a second economic miracle. Vishnu's departure from the Ministry which made him a legend will be a personal setback for many people who voted for Lepep because they associated the first 'miracle' with him. And had wanted to witness the making of another. Live and direct.

Ramgoolam Vague About Labour DNA

A week ago he said it's made up of unity, development and social justice. For sure these are important values but they are a bit too vague. But first let's see how he did according to these values.

Pretty average in the unity department if the end result of three mandates (especially the last two) has been to bring Mauritius closer to an overcrowded barracoon. Granted that Manou Bheenick -- picked by Ramgoolam after 18 long months -- made us quite proud and united as far as the external value of our currency goes while he was calling the shots at the Central Bank.

Who's the Better Cake-Cutter?

We can get an idea if we look at the Household Budget Surveys (HBS) that our highly-esteemed CSO publishes every five years. Let us proceed the same way that a clock ticks and start comparing the 1991/92 data with that of 1996/97.

Lutchmeenaraidoo vs. Sithanen

These are quite interesting years as they coincide approximately with the last year for Vishnu Lutchmeenaraidoo as Finance Minister and the end of the first mandate of Rama Sithanen. It gives an indication of how the cutting of the economic cake changed from Minister to Minister. In this case from cousin to cousin.

As Table 1 illustrates every single group saw their share of the national cake fall except the richest one. The poorest 10% -- that's the group which is more vulnerable in case you have forgotten -- had their share reduced by 13%. The other thing you want to note here is that the ratio of the share of the wealthiest to the poorest which was 12.09 when Mr. Lutchmeenaraidoo left increased to 15.40. Which means increased inequality and that's bad for growth -- just like keeping energy prices much higher than what is reasonable, flattening taxes or creating a major structural problem by making a multi-billion rupee gift to a dead industry -- and for the general well-being of our country. Please note that these were both ministers under SAJ. And I guess you will be hard-pressed to find even traces of a savat-leponz-gato-pima effect in the 1996/97 data.

Why Our Youth Don't Have A Skills Mismatch

Simply because technology has flattened every single learning curve. So anybody who has recently graduated should be able to help push Mauritius forward provided a reasonable number of opportunities are available. This will happen only if certain conditions are met. Like energy prices -- a major building block of GDP -- shouldn't stay disconnected from their world prices. Something which unfortunately happened for way too long.

We want our youth to transform the skills they've acquired -- and will keep on acquiring -- into meaningful outcomes fast because otherwise they will lose confidence in themselves and their gifts will go to waste. And then it will be everybody's loss. This will also depend on the quality of policy-making at Government House. The latter just like the private sector -- large and small -- must make good bets. Because that's the way they will create wealth or value. Which is about getting out more than what is put in. For example the CEB can float a bond, invest into a power project and then make a reasonable profit. Or sell clean electricity at competitive prices which will help Mauritius Inc. make one. The Passport Office can get us our travel documents fast making us save time which is another name for money. Similarly private sector companies can create value by moving upmarket or into new industries which are compatible with the standards of living that Mauritians reasonably aspire to. Not with those of the cheapest foreign worker available.

The other side of the coin is that Government and private sector companies routinely destroy value. And they do that -- to be sure there are fans of Marx too in there --  in many ways. We've seen how the STC can mysteriously lose billions and then lose a couple of billions more. Bosses of private companies may also put the enjoyment of super cars before the survival of their firm. Or allow themselves to be infected with hubris and start believing that this time it's different and that crises like those that happened in South East Asia in 1997 and elsewhere can never happen in Mauritius. Because we're the land of the lazy Dodo. Of course.

How Bad Was Sithanen?

His nine-year-old economic reforms have been an unmitigated mess. Plenty has been written about this. For example his policies have been worse than flipping a coin. A roulette in the Treasury Building would have produced even better outcomes. Which gives you an idea of the kind of skills mismatch we're talking about here. But let's look at it from a different perspective given how sophisticated Mauritian voters have shown us they can be.

Mr. Sithanen claims that he saved the economy. If that's the case then why didn't he:

1. get a ticket from Ramgoolam in 2010?

2. get a MMM ticket in 2010 after asking voters to punish one fils a papa who had betrayed him?

3. stand as an independent candidate in no. 18 in 2010? Dr. Sithanen was after all a force to reckon with in Belle-Rose/Quatre-Bornes. Not anymore.

Because if you analyse electoral data you'll find out that the people of Mauritius are able to express a whole range of feelings. For example and as the chart illustrates Sir Veerasamy Ringadoo -- our Minister of Finance for a long time -- had no problem facing the music in 1982 and even got 20% of the votes in his riding. Because SVR knew that he had done his best. Nine years later Lutchmeenaraidoo ran as a candidate for a party other than the one which had made him Finance Minister for eight years and still managed to get 46% of the votes. Fast forward nine years again and we have voters expressing an amount of sympathy towards former Police Commissioner Raj Dayal that almost got him into Parliament.

Eski Sithanen Enn Kosmar Pu Popilasyon?

Kestyon bet, non? Kosmar disparet ler uver lizye. Parkont lanfer so bann politik ekonomik kontinye fer u lavi vinn margoz pandan buku banane. Sithanen finn reponn a sa kestyon la resama avek kat kestyon. Anu analyz zot.

1. Linn dimande si pa enn politisyen de long dat kuma Ramgoolam ti pu pran enn risk vinn tir li depi kot liete si li tienn kosmar. Anfet Ramgoolam pe pran enn mari gro risk reprezant Sithanen kom minis de finans apre sa bann gro gro dal ki linn fane ant 2005 ek 2010 (nu tu finn remarke ki lalyans pep tuni pann gagn sa kantite plis dimunn ki lalyans papa piti dan miting nasyonal le duz oktob). Me kan de parmi trwa pli gran parti zwen sa amenn suvan bann gro skor dan elekyson: sa lalians la gagn lao 50 siez. Me pa tu letan (ek sa eleksyon ki pe vini la pa enn eleksyon ordiner ditu sa). An 2005 Ramgoolam ti gagn enn viktwar istorik ler enn gro parti ti bat 2 gro parti.

Anfet telma Sithanen ti fann dal kom minis de finans -- avek so kamwad Ali Mansoor -- ki Ramgoolam finn bizin ed Pravind Jugnauth eli dan No. 8, donn enn segon manda prezidan SAJ pu finalman fer lalians ek MSM ek pa donn tiket Sithanen. Parksi Ramgoolam ti kone si ti donn li tiket kitfwa Ramgoolam mem ti pwal manz feyaz. Sithanen pann gagn tiket ar Berenger usi byen ki Berenger -- papa kominalis syantifik sa do -- ti dir ki Ramgoolam finn fer fos ek bann Tamul-morisyen parski Berenger kone ki elekter pa kas latet ar kominote bann faner dal.

Gandhi’s Education

I don't let my schooling interfere with my education.

 Mark Twain

You are reading this because of something Firoz Ghanty wrote in Forum last December when Madiba passed away: you could come away with the impression that Gandhi didn't give two hoots about the plight of blacks in general and black South Africans in particular. This kind of puzzled me and made me realize that my knowledge of the work of the Mahatma was way too sketchy. So I went to do a little bit of research. To get my schooling out of the way.

Shocking: MK spent 

21 years in South Africa

I always thought he spent very little time in SA. Only a little longer that was really necessary to get thrown off the first class train compartment in Maritzburg. Well at least that’s what it looked like in the Amar Chitra Katha cartoons I read when I was a kid. Or saw in Richard Attenborough’s magnificent motion picture. Man, just writing this makes me want go watch that movie again. More carefully. With Alma Reville-like eyes. So yeah, he spent more than two decades there and we don’t recall him asking for at least the release of our beloved Madiba. If applying his magic to free all black South Africans was too complicated. Let’s see why he went there in the first place.

A shy Mohandas arrives 

on a year-long contract

After he failed to set up a law practice in Mumbai because – thanks Wikipedia – he couldn’t get himself to cross-examine witnesses and got into trouble with the colonial powers writing petitions. So he takes up the offer to defend the rights of wealthy South African Indian Muslims. And sure enough he runs into the wall of apartheid pretty fast: the Maritzburg incident happens within one week of his arrival. He spends the night in that cold train station taking in what had just happened but finally travels by first class the following day after protesting. So he slowly understands what’s going on in South Africa and becomes increasingly good at improving the lot of his Indian clients. But not without initially making statements like “the White race of South Africa should be the predominating race”. Getting rid of misconceptions is rarely a linear process. I guess if he played the eager Mahatma then two things could have happened to him: he might have been eliminated by the brutal regime – which almost happened later on when his actions gained enough traction and got noticed – or sent back to India by disappointed clients. Yeah, but, he could have done more. A lot more. Easier said than done.

Gandhi gets better 

at his trade. A lot better

He’s experimenting with all kinds of things. Including fasting which will produce famous results when he returns to India. And tracking their effects precisely. To edit his lifework. Repeatedly. Events produce different educational benefits. For example the Bambatha rebellion is a better teacher than the Boer War which happened six years earlier. He refines his work. His negotiating and organizational skills improve. MK integrates the different elements of his political action as seamlessly as possible. He sets up a prototype for some of Tolstoy’s ideas a bit like Steve Jobs built a store mockup to get the retail experience absolutely right at a time when competitors were hemorrhaging money in their stores. Satyagraha is shaping up because Gandhi got himself – to use Thomas Edison terminology – a huge pile of junk. Because he’s slowing down so he can go faster. It’s like building the Mac of political transformations.

Still, why didn’t he ask 

for the release of Mandela?

The reason is simple. When Gandhi left South Africa for India in 1914 Mandela was not yet born. Fair enough. But he could have later, couldn’t he? Not really because when Godse fired three shots point-blank into the chest of MG in 1948 Mandela had not yet been sent to jail. That was not going to happen for another fourteen years. It’s usually – but not always – difficult to do anything after your life is taken away. Even for a Mahatma.

Experiencing a 

little bit of apartheid

I shared my initial findings with Filip Fanchette a few months after the Ghanty article had appeared. When he told me a personal story. In 1956 he was traveling to Europe on a ship via the Suez Canal when the crisis broke out. They had no choice but to go southwards around most of Africa. And when they stopped in Cape Town 19-year old Filip went to the post office to try to inform friends of his delay. He goes up a flight of stairs and then arrives on a landing with two additional sets of steps: one for whites and one for non-whites. On experiencing this he freezes completely. Completely. For a long while. Not knowing what to do. Shocked and awed. It’s only after a lady seeing what’s happening shows him where he should go that he unfreezes. But he stays pretty stunned. This event, along with a few others, have informed much of what he was to do afterwards. I talked with him again this week about that event which happened almost 60 years ago. He retold me the story adding that it’s still crystal clear in his mind. To paraphrase Michael Jordan, it’s the wood that gets added to the fire inside of us.

But it’s easier for Madiba

to write about Gandhi

And he does. On a number of times. Like in the first issue of Time magazine in 2000. Where he calls that great teacher of his The Sacred Warrior. And from where I’ve pulled one of the highlighted quotes. Which says it all. Mandela – not yet President – is also there on June 6, 1993 in Maritzburg to unveil a Gandhi Memorial right in the city centre to mark the 100th anniversary of the train incident. In his speech he says “Gandhiji influenced the activities of liberation movements, civil rights movements and religious organisations in all five continents of the world. He impacted on men and women who have achieved significant historical changes in their countries not least amongst whom is Martin Luther King.” Indeed Google will quickly bring up that Dr. King was more than just a fan of MG’s approach to solving political problems. And I guess that you are aware that of the two pictures that Apple Chief Tim Cook has in his office one is of MLK. 

Nelson Mandela adds “Today as we strive to achieve a date for the first democratic elections in this country, the legacy of Gandhiji has an immediate relevance. He negotiated in good faith and without bitterness. But when the oppressor reneged he returned to mass resistance. He combined negotiation and mass action and illustrated that the end result through either means was effective. Gandhi is most revered for his commitment to non-violence and the Congress Movement was strongly influenced by this Gandhian philosophy, it was a philosophy that achieved the mobilisation of millions of South Africans during the 1952 defiance campaign, which established the ANC as a mass based organisation. The ANC and its congress alliance partners worked jointly to protest the pass laws and the racist ideologies of the white political parties.”

South Africa is the

birth place of Satyagraha

Which explains where the centenary of the movement was celebrated in 2006. With former Indian PM Manmohan Singh in attendance. President Mbeki cites Martin Luther King in his speech "If humanity is to progress, Gandhi is inescapable. He lived, thought, and acted, inspired by the vision of humanity evolving toward a world of peace and harmony. We may ignore him at our own risk." And when Nelson Mandela passed away last year Dr. Singh hailed him as a “True Gandhian”.

So yeah I guess we can say the following about the trade of the birthday boy. Developed in SA. Perfected and used extensively in India. And everywhere else.

© Sanjay Jagatsingh, 2014

Thoughts on Electoral Reform (3)

There are a number of problems with the Constitution Temporary Provisions Bill and its Explanatory Memorandum.

Temporary Provisions Bill 

has at least three problems

I don't think it's right to say that you are presenting a bill that modifies our constitution for one election pending subsuming the best loser system into another system for at least three reasons: (i) there is no guarantee that the same government will be there after the next election; (ii) there is no guarantee that the next government will want or have the required numbers to modify the constitution again or that enough MPs will agree to do so -- which means that candidates may be obliged to declare a community again in subsequent general elections; and (iii) the proposed electoral system that the current government wishes to adopt does not subsume the Best Loser System (BLS) as we know it because this system is simply not subsumable.

Plus Bill flouts meritocracy

If there are additional seats they should be allocated to the most successful unreturned candidates as measured by the percentage of votes received because our ridings are not exactly of the same size. That is if Mrs. Robinson who hasn’t declared a community tops that list then she should get the first additional seat. And not someone who ranks a lot lower in the esteem of voters. After all MP is a job like any other – save the indefinite paid holidays this year – and nobody who has the blessing of the voters should be discriminated against. Besides, ethnicity is not a criterion which will enable an MP to do his or her job better.

Thoughts on Electoral Reform (2)

What are we trying to solve with electoral reform? Mostly two things. One is to get rid of the Best Loser System (BLS) – which was the closest thing to stamping us like cattle that one could come up with – and therefore comply with the UNHRC ruling. The other is to try to reduce the unfairness of the First Past The Post (FPTP) system without compromising its stability. Of course both of these objectives can be achieved without introducing the totally undemocratic devices like proportional representation (PR) and double candidacies as proposed in the white paper -- which is nothing more than the toxic 2012 Sithanen report less 4 MPs. Above all we must not lose track of the most important purpose of our Parliament which is to provide good, long and healthy lives for a maximum of citizens by the design and implementation of thoughtful policies. Right? Let us begin with a little bit of history.

Down with PR

As Yashwant Jeewoolall reminded us recently, Labour was dead against PR when it was proposed some sixty years ago. The progressive individuals of the time fought against PR because they knew that party lists would shift the loyalty of MPs from voters to leaders. Indeed if you read Chit Dhukira's Experiments in Democracy you will find out that Philippe Rozemont -- Guy's brother -- was expelled from the Labour Party because he voted in favour of it and that Renganaden Seeneevassen was one of the fiercest opponents of PR. There was even a bye-election in 1956 which revolved around PR and which the Labour Party won. So suggesting PR would be a betrayal of the DNA of the Labour Party.