The
Week In Review
America:
Politics takes a back seat as banks crumble
--
PARAMANAND SOOBARAH
The
last few days in America have been a nightmare. The biggest
banks have been tottering on the verge of bankruptcy, and
the US government has been forced to abandon its free market
principle of non-interference to come to the rescue of those
banks with billions of dollars of taxpayers' money. Earlier
this year the US Treasury rescued Bear Stearns with a $30
billion package and last week committed $200 billion to
rescue the housing loan giants Freddie Mac and Fannie Mae.
When
the bank Lehman Brothers fell into trouble, Treasury
Secretary Paulson decided that his administration would
revert to its policy of non-interference, and that bank was
forced to file for bankruptcy. However when in the last two
days the giant insurance company American International
Group Inc (AIG) ran into trouble, he was forced to intervene
because "the group was too large to be allowed to
fail." He made $85 billion available at once. Other
large banks are about to fail. At the same time, Merrill
Lynch, a long established giant of finance, was also about
to fail but was bought out by the Bank of America. US
Congress is separately considering a loan of 25 to 50
billion dollars to automakers in order to help them produce
cars to meet new mileage standards to cut down on fuel
consumption.
There
had never been so much subsidization in America before,
never a situation where the capitalists so obviously took
all the profits and the taxpayer carried all the risks.
Another notable feature of the present arrangements in
financial companies was that even when companies failed, the
CEOs walked away with tens of millions of dollars in
compensation. Companies and other similar entities are
managed by executives for executives never mind the
shareholders.
The
sort of government policies that have led to this situation
have, unfortunately for Senator John McCain, been associated
with Republican administrations, and Senator Barack Obama's
poll rating is likely to improve. Latest figures show him to
be at 46%, just ahead of Senator McCain's 45%.
Amid
all the financial and electoral turmoil, one must not forget
the destruction caused by Hurricane Ike, which has brought
havoc to Texas and serious problems right across the United
States right up to the Canadian border.
One
piece of good news in the financial world is that the price
of oil has finally descended to below $100 a barrel. From
around $30 a barrel in 2001 it rose to nearly $150 a barrel
a couple of months ago. This has been the greatest transfer
of wealth in history. Sadly, a good proportion of that has
gone towards financing terrorism.
*
* *
Europe
NATO
still dealing with the fall-out from the Georgian adventure
NATO
Foreign Ministers held a special meeting in Georgia's
capital Tbilisi to demonstrate their commitment to Georgia,
and reiterated the stand of their countries that there will
be no "business as usual" with Russia until the
latter withdraws completely from Georgia. At the same time,
Russia and the breakaway territories of Abkhazia and South
Ossetia, recognised as independent countries by Russia, have
signed a mutual defence
pact. In future relations between Russia and NATO, one of
the two will have to give way if a prolonged Cold War
situation is not to prevail.
European
countries have also announced that they will work on a
Trans-Sahara gas pipeline to reduce their dependency on
Russian gas.
In
the meantime the shockwaves from the financial earthquake in
America have also reached Europe. HBOS, owner of UK
mortgage-lender Halifax, is in serious trouble, and is being
bought out by Lloyds in a $50 billion deal. Earlier in the
year, it will be recalled that the UK bank Northern Rock had
to be rescued with taxpayers' money. It would appear that
the turmoil in Europe is just beginning. That includes
Russia which is also badly shaken; it may not be able to
stand up to NATO the way it had originally planned. Prayers
would be in order for our own little country too.
*
* *
The
Middle East
Politics
in Israel and terror elsewhere
In
Israel, Foreign Minister Tzipi Livni has been elected leader
of the ruling Kadima Party, and she will now try to form a
government to take over from Prime Minister Ehud Olmert who
is stepping down to face corruption charges. She will need
to reestablish the coalition with the Labour Party of Ehud
Barak. If she succeeds, she will have tough problems ahead
of her, including the handling of the Palestinian
negotiations, the relations with Hamas and with Syria, and
more importantly, on what to do on the question of Iran.
There are fears in Israel that a President Obama might want
to avoid war with Iran and come to some accommodation with
that country, a possibility not at all to the liking of
Israelis. It is just possible that if a victory of Senator
Obama looks like a strong possibility, or if he wins in
November, Israel may launch a pre-emptive strike on Iran
while President Bush is still around.
The
US Embassy has been bombed in Yemen off which country it
will be remembered the US warship USS Cole was attacked in
the days of President Clinton. Bomb attacks have taken place
in Iraq as well. One continuing problem in Iraq for the
present American administration is the stubbornness of Iraqi
Prime Minister Al-Maliki in setting conditions for extending
the stay of American troops. He wants such troops to be
governed by Iraqi law in future. This has always been a
stumbling block with America right round the world
America always insists that its troops remain under its own
jurisdiction, wherever they might be stationed.
*
* *
South
Asia
The
Subcontinent is back to square one
Anti-Pakistan
policies have never really succeeded in uniting India
the large Muslim minority would never have agreed to begin
with whereas anti-India rhetoric always does unite
Pakistan. The process seems to be back in full swing.
Pakistan
is being blamed in many quarters in India for the recent
spate of bombings by "Indian Mujahideen", and it
seems as if newly elected President Zardari is keen to find
solutions to his problems in politics. As the US-India
Nuclear Agreement reaches Congress for a vote, President
Zardari declares that he will be approaching China for
assistance with such supplies in order to match India's
advantage. This is not a military advantage, just a civil
one, but in the Pakistani psyche, the most important thing
to do is to match and surpass India in every field from
cricket to nuclear technology.
In
the meantime, Pakistan is beset by great financial problems.
It urgently needs huge cash inputs if it is not to default
on its international debts. Pakistani Taliban are no longer
content with just supporting Afghan Taliban they now
seriously wish to establish a Sharia State in the North.
Bombings by them are continuing, as also the strikes by US
drones. Somehow, judging by press reports, the US strikes
always succeed in killing more civilians than "jihadis".
Former Prime Minister Nawaz Sharif is calling for a
suspension of anti-terror activities, as according to him
these activities provide the reason to the Taliban for their
bomb attacks.
In
India, the Congress-led UPA government is mulling tighter
anti-terrorism laws in the wake of the Delhi blasts; on
coming to power it had repealed those that had been
introduced by the previous BJP-led government. But many in
Congress are of the view that such laws will alienate the
Muslims, their vote bank. But if laws against terrorism are
always interpreted as being directed against Muslims, there
will never be peace. Terrorists must be treated as
terrorists, regardless of the religion they profess. No
Indian Muslim, or perhaps more accurately, very few Indian
Muslims, want to die, or their children to die, in bomb
blasts regardless of who sets them off.
The
problem seems to lie in the selfish and dishonest nature of
UPA politicians who believe they will capture the Muslim
vote if they can paint any measure in India as being
anti-Muslim and be then seen to be defending the Muslim
cause. They may well succeed, and that for a long time. They
will be helped by those who actually set out to act against
Muslims like refusing to rent their houses to them or
offer them jobs or allow them trading opportunities. But in
the end all may find that their solutions lie in the path of
non-violent economic development.
*
* *
National Matters
Torrential
rains force school closures
The
last few days have seen an abnormally high rate of rainfall.
MET officials say that during the last 48 hours the country
as a whole has received five times the average rainfall for
a whole month. Obviously, this being an average figure, some
places have received less and others much more than this
amount. This is the sort of rainfall that leads to flooding
the ground gets so soaked that it cannot absorb anymore,
and the excess has to run off. The normal watercourses get
swelled and overflow their banks, and some flooding is bound
to occur.
The
Ministry of Education is to be congratulated for having
taken the precaution of closing its establishments until
further notice. However, I doubt whether the Ministry'
responsibility is over just by closing the schools. What
happens to the children who have to stay at home when both
parents are away working? Such a situation would arise even
if the unforeseen closure were due to some reason other than
weather. This is a matter that may have far-reaching
ramifications, and ought to be attended to.
Perhaps,
to begin with, parents must be warned that they must have
arrangements to ensure the safety of their children in the
event that the school which they attend has to remain closed
for a day or part of a day without prior notice.
Handling unforeseen
phenomena
Beyond
occasional school closures, there are a whole host of
matters that must be addressed under the broad heading of
Unusual Phenomena; these need not only be Acts of God as
commonly understood but also major accidents and health
scares that would demand immediate attention from the public
-- and even private authorities. All phenomena that
would make unusual demands for action upon the authorities
should as far as possible be listed and some plans be made
for handling them. There are certain areas where special
works are required to make sure that drains are not blocked:
we should not wait for the rain to arrive to carry out those
works. A small body of officers ought to be appointed within
the Ministry of Internal Affairs to work permanently on such
matters in liaison with the other ministries involved. They
should have a website into which members of the public could
input their suggestions.
In
these days of climate change cyclones may well increase in
frequency and intensity, and may have more long-lasting
effects on our food supply and our transport and
communications systems. These matters need to be addressed
and solutions found before the situations actually hit us. I
have also always thought that our major hotels should plan
entertainment for any tourists that stay with us during
cyclones. This may help them not to feel any inclination not
to come back to the country because of the possibility of
cyclones.
I
am not sure that we have done everything we could to ensure
that disruption to our air services has been minimized to
the shortest duration possible. If during a cyclone here an
aircraft bound for Mauritius is sitting on the ground in
London or Delhi or Perth, it has to wait for a long time to
receive a clearance to take off on its voyage. An alternate
runway in Agalega would permit such aircraft to take off
much earlier; if for any reason the weather has not improved
sufficiently at Plaisance, it could then land at Agalega to
wait out the cyclone there.
One
cyclone related problem at the Airport during the days when
I used to work there in the seventies was the difficulty of
personnel to travel to and from the airport after the
issuance of a Class III warning. If the staff have to wait
until that warning has been lifted, the reopening of the
airport may take an unnecessarily long time. I would imagine
that Health and other round-the-clock services suffer from
similar problems. The government ought to provide special
insurance cover to staff having to use their cars in such
conditions.
There
also remains one important problem in this connection. In
the seventies we could never declare an airport closed
the then Prime Minister, Sir Seewoosagur Ramgoolam, having
had a good briefing from the expatriate Directors of Civil
Aviation that he had worked with, would never have stood for
it. This was an old British tradition that eventually found
its way into international regulations. As far as I am aware
these regulations have not changed, but I believe that in
these days the Airport is declared officially closed.
In
aviation the decision to land and take off rests with the
aircraft commander, who takes all aspects of the weather on
his operations into account. Cyclones, typhoons and
hurricanes come in many countries, and it is actually the
weather that closes the airport. Perhaps we ought to tell
the International Civil Aviation Organisation that we are
forced to close our Airport in certain weather situations.
The National Cyclone
Procedures
We
have long-standing procedures for handling cyclones to
the extent that they are almost routine. It would be
appropriate here to acknowledge the excellence of our
Meteorological Department which has always served us well,
particularly in the days when we did not have satellites and
other large-scale surveillance equipment. Now you can
actually see the centre of a cyclone and its spread around
it on a satellite image.
In
the early days all you had were short messages from ships
scattered far and wide over the ocean and a few stations on
the coast that would pass readings of their local pressure,
temperature and wind speed and direction. With these
readings the MET department would construct wide-area charts
showing equal-pressure lines (isobars) which would be used
for forecasting the weather. Circular pressure patterns
would indicate cyclones and the specialists would hazard
their best guess as to the position and direction of
movement of the cyclone.
The
best guess would be a mixture statistical inference from the
data with a good proportion of the individual director's own
hunch as in the heroic days of Mr Davy and Mr Padya. We
are so lucky they were right for the famous cyclone Carol in
1960; their timely warnings saved many lives. That cyclone
also put an end to wooden, straw-covered houses a majority
of Mauritians used to live in, and introduced the era of
concrete, cyclone-proof houses we now live in.
Watching
the rubble left behind by Hurricane Ike in Texas, consisting
mainly of bits of wood, one feels that tiny Mauritius has
something to teach to mighty America.
*
* *
The Legacy of SSR
Reading
about the protests of some communities about the supposed
under-representation of certain communities in the
recently-reshuffled cabinet
of Prime Minister Navin Ramgoolam, one is obliged to think
back to the difficult days just before and after our
Independence. That feat was itself brought about by Sir
Seewoosagur Ramgoolam at the head of the Mauritius Labour
Party with the help of the Comitι d'Action Musulman of Sir
Abdool Razack Mohamed and the Independent Forward Block of
Sookdeo Bissoondoyal.
Just
winning Independence was not enough for him. SSR felt he had
to unite all communities, even at the expense of sacrificing
the support of the leader of one the parties that helped him
earlier but he did manage to keep most of the elected
members of that party with him. He had to get the Parti
Mauricien of Sir Gaetan Duval in, so as to form a government
of national unity. On this his 108th birthday, it
is fitting that we remember that he united all communities
in the country, including those that had bitterly fought him
in the past. Another leader might have decided to wreak
vengeance on those who had opposed Independence, but for him
the national interest was infinitely more important than
just the party's or the community's interest.
One
is somewhat disappointed when one finds that the criterion
of a good Cabinet is taken by some to mean the proportion of
people of their community in the cabinet. I fail to see how the presence of somebody of my
community in the Cabinet helps me. Some people tell me that
when they approach their relative who is a Minister, he
usually tells them he cannot help them because he would be
charged with nepotism.
Should
it be the fraction of Minister per capita that matters to
any member of some community or the benefits per capita that
the community gets from the government? I am sure there are
statisticians around who could compute the benefits that
each member of each community draws from Education, Health,
and Social Security Services and Business Opportunities, and
also the amount that each member similarly contributes to
the national exchequer through direct and indirect taxes.
Would those who over-benefit or under-contribute be equally
demanding in proportional benefits and contributions?
However
it may, we trust that Prime Minister Navin Ramgoolam does
not cave in demands for proportional communal or caste
representation. The vast majority of the population is by
far more interested in the quality of services delivered by
the ministries than in the community or caste of the
ministers. There may perhaps be some room for introducing an
official lobby system that permits small groups to bring
their problems collectively to the attention of Parliament.
However, when small groups of people set themselves up as
spokespersons of large communities, one never really knows
how truly representative they are.
*
* *
Average Income or Median
Income?
Talking
about benefits and statistics reminds us that we have
recently been told that the annual average income of
Mauritians will soon reach USD 10,000 per annum. A figure
that would be more instructive would be the median income of
Mauritians per annum. If nine people get Rs 1,000 each, and
a tenth gets Rs 91,000, their average income will be Rs
10,000 a meaningless figure for the great majority of
them. But the median figure will be just Rs 1000, a much
more meaningful figure. Will those responsible for these
statistics please also let us the median income of
Mauritians?
*
* *
Food Security
We
have in the past urged the government on several occasions
to engage in research to make us independent in the matter
of essential food items like rice, wheat, potatoes and milk.
In the past we were usually told that rice and wheat
couldnt be grown in Mauritius something that we do
not accept.
However,
we were pleased to note that the Ministry of Agro-Industry
recently reported on progress concerning the production of
wheat. We tender belated thanks to Minister Arvin Boolell
for that feat, and we urge his successor at that Ministry to
continue the good work. It is not safe for us to rely on
imports for those items, nor can we accept that they cannot
be produced in Mauritius. Research must continue until
satisfactory results are obtained, and must thereafter
continue for ever to keep on improving the results.
PARAMANAND
SOOBARAH
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