Crony capitalism: The big underbelly of Indian corporate

Satyam Inc. was waiting to happen what was shocking was extend of money involved whooping 7000crore!! (incidentally one crore is 100 lakh, and one lakh is 100000Rs. Consider also that one Kg of rice cost 20Rs!!!). So much for greed fuelled capitalism.

The blogger has been a supporter of government regulations as part of corporate governance. Government’s role has become significant in recent times. Few decades back government was interventionist in a corrupting way and had tendency to be authoritative. Times have changed. This blogger believes that with technological development as also the awareness among people the chance of authoritarianism in democratic government is quite negligible atleast in Indian context. If ever it happens it will not be able to sustain.

The danger is from unbridled market. With market controlling media what we are seeing is a nexus between Politicians, Corporate and Media. This is what is referred to as crony capitalism and India is very much susceptible to this. It is about loving the family and friends, also referred to as “inside trading”!!. In the garb of capitalism there is a swindle happening at a colossal proportion. One must be a fool to think Satyam is an exception. 7000crores over so many years cannot be an exception, the checks are only in paper. It means that something is really wrong in the way the capitalism functions (also consider that Madoff made of with billions of dollars). Clearly Corporates shouldn’t self regulate, they epitomizes nothing. They are trying to run business, and government should be facilitator keeping contexts of societies in mind. Satyam’s tag line is “What Business Demands” (really demands??. Some really get complacent even in arrogance, that they don’t realize it has become obvious). Corporates in recent times have not only been a failure but also have swindled the hard earned money of common people, jeopardized lives of millions of people. Further they have put societies and environment at risk over the decades. GDP is no indicator about anything nor is sensitivities of sensex.

The dangers of Market authoritarianism is not fully understood in this part of the world. Since policy makers are influenced by gainers of this system and needs some shockers like Satyam (even now there would be some Indian marketer who would be arguing that Ramlinga Raju was foolish to have confessed he could have blamed someone else. I guess it is TINA factor otherwise these people would have easily slipped away. That is something unique in this part of the world). Market controlling the media has complicated the issue further. Media seems to be nothing more than PR of Corporates. In poor societies irresponsible media can be devastating, it makes the mockery of democracy.

Market is also about projecting or exaggerating, it is about creating perceptions. They call it brand building. This blogger finds it amusing that although economists consider themselves quite logical but defining terms of market are mostly far from logic. It seems market has mutated into an animal nobody understands, few have some perceptions. The edifice seems to be build on these perceptions (for some it is quantified through Sensex). In most case these perceptions have nothing remotely connected to the reality. Entire ad industry is based on this unreality. Satyam only tried to maximize-put up, so did the Bush-Blair (here the term used was “sexed up”). It is about selling to the people. Never mind what the reality is. These lies balloon up and as expected bursts. Precisely what they refer as financial crisis (East Asia had it a decade back they referred to it as financial melt down. never mind that it was another example of crony capitalism. Anyone recall the Korean term Chaebol? The same could be true for india too). It is in this competitive corruption that media gains significance, since it is a linchpin. It holds the cards for creating the perception among common people. Study the role of media in two significant events that affected the world. One was attack on Iraq and how the American media played with the US government. Second, is the nil focus on corruption among Corporates. It seems that financial crisis was unpredictable (really). Since media is another face of Corporate it becomes important for the Government to create sufficient checks and stringent punishments. Democracy is the answer against crony capitalism. How many political parties have internal party democracy?. How many Corporate function with transparency?. Is there transparency in the Judiciary?. Why resistance to obundsman or Lok pal including Judiciary?. How does media choose what is important?. Isn't it decided by market compulsion?

Thankfully a significant number of elected representatives are not decided/influenced by Market. The reason why this blogger is hopeful. But then Indian society seems to be living on borrowed time. Very soon market will encroach every aspect of our life. I shudder to think about that eventuality. Education was a hope but even that is influenced by profit mongers. Am I getting pessimistic?

Disclaimer: Not denying that are really admirable people in Corporate and Media. But then media thrives on confrontation (the also call it competition), and whatever helps TRP. Can we deny that?. There are reasons to be pessimistic. The more you think the more hopeless these systems looks. The best of people end up doing the worst of things in the name of profit and TRP.

India’s War on Trees

for more visit photo blog. It is very saddening hundreds of trees are being cut with impunity. Hopefully economic slowdown will also slow down these environment catastrophes, also hoping for more people not dead serious about dead lines and dead trees.