Sunday, October 30, 2011

Free markets cannot be totally free

Next year will mark the 100th anniversary of Milton Friedman's birth.
By Dani Rodrik

Friedman was one of the 20th century's leading economists, a Nobel Prize winner who made notable contributions to monetary policy and consumption theory. But he will be remembered primarily as the visionary who provided the intellectual firepower for free-market enthusiasts during the second half of the century, and as the eminence grise behind the dramatic shift in the economic policies that took place after 1980.

At a time when scepticism about markets ran rampant, Friedman explained in clear, accessible language that private enterprise is the foundation of economic prosperity. All successful economies are built on thrift, hard work, and individual initiative. He railed against government regulations that encumber entrepreneurship and restrict markets. What Adam Smith was to the 18th century, Milton Friedman was to the 20th.

As Friedman's landmark television series Free To Choose was broadcast in 1980, the world economy stood in the throes of a singular transformation. Inspired by Friedman's ideas, Ronald Reagan, Margaret Thatcher and many other government leaders began to dismantle the government restrictions and regulations that had been built up over the preceding decades.

China moved away from central planning and allowed markets to flourish - first in agricultural products and, eventually, in industrial goods. Latin America sharply reduced its trade barriers and privatised its state-owned firms. When the Berlin Wall fell in 1990, there was no doubt as to which direction the former command economies would take: towards free markets.

But Friedman also produced a less felicitous legacy. In his zeal to promote the power of markets, he drew too sharp a distinction between the market and the state. In effect, he presented government as the enemy of the market. He therefore blinded us to the evident reality that all successful economies are, in fact, mixed.

Unfortunately, the world economy is still contending with that blindness in the aftermath of a financial crisis that resulted, in no small part, from letting financial markets run too free.

The Friedmanite perspective greatly underestimates the institutional prerequisites of markets. Let the government simply enforce property rights and contracts, and - presto - markets can work their magic. In fact, the kind of markets that modern economies need are not self-creating, self-regulating, self-stabilising, or self-legitimising. Governments must invest in transport and communication networks; counteract asymmetric information, externalities, and unequal bargaining power; moderate financial panics and recessions; and respond to popular demands for safety nets and social insurance.

Markets are the essence of a market economy in the same sense that lemons are the essence of lemonade. Pure lemon juice is barely drinkable. To make good lemonade, you need to mix it with water and sugar. Of course, if you put too much water in the mix, you ruin the lemonade, just as too much government meddling can make markets dysfunctional. The trick is not to discard the water and the sugar, but to get the proportions right. Hong Kong, which Friedman held up as the exemplar of a free-market society, remains the exception to the mixed-economy rule - and even there the government has played a large role in providing land for housing.

The image most people will retain of Friedman is the smiling, diminutive, unassuming professor holding up a pencil in front of the cameras in Free To Choose to illustrate the power of markets. It took thousands of people all over the world to make this pencil, Friedman said - to mine the graphite, cut the wood, assemble the components and market the final product. No single central authority coordinated their actions; that feat was accomplished by the magic of free markets and the price system.

More than 30 years later, there is an interesting coda to the pencil story (which in fact was based on a commentary by the economist Leonard E. Read). Today, most of the world's pencils are produced in China - an economy that is a peculiar mix of private entrepreneurship and state direction.

A modern-day Friedman might want to ask how China has come to dominate the pencil industry, as it has so many others. There are better sources of graphite in Mexico and South Korea. Forest reserves are more plentiful in Indonesia and Brazil. Germany and the United States have better technology. China has a lot of low-cost labour, but so do Bangladesh, Ethiopia and many other populous low-income countries.

Undoubtedly, most of the credit belongs to the initiative and hard work of Chinese entrepreneurs and labourers. But the present-day pencil story would be incomplete without citing China's state-owned firms, which made the initial investments in technology and labour training; lax forest management policies, which kept wood artificially cheap; generous export subsidies; and government intervention in currency markets, which gives Chinese producers a significant cost advantage.

China's government has subsidised, protected and goaded its firms to ensure rapid industrialisation, thereby altering the global division of labour in its favour.

Friedman himself would have rued these government policies. Yet the tens of thousands of workers whom pencil factories in China employ would most likely have remained poor farmers if the government had not given market forces a nudge to get the industry off the ground. Given China's economic success, it is hard to deny the contribution made by the government's industrialisation policies.

Free-market enthusiasts' place in the history of economic thought will remain secure. But thinkers like Friedman leave an ambiguous and puzzling legacy, because it is the interventionists who have succeeded in economic history, where it really matters.

Dani Rodrik, professor of international political economy at Harvard University, is the author of The Globalisation Paradox: Democracy And The Future Of The World Economy. Project Syndicate

Saturday, October 29, 2011

Pit stop in poverty raises questions of value

NEW DELHI: They screech in on private jets and party with the rich and famous, but Formula One's pampered drivers admit the poverty in India has given them a reality check.

Although the brand new Buddh International Circuit is ready for the inaugural Indian Grand Prix, the plush facilities cannot hide the slums outside.

Britain's Jenson Button said coming to India was 'difficult' for the drivers, who have been stunned at the living conditions glimpsed outside their luxury hotels.

'You can't forget the poverty in India,' he said.

'It's difficult coming here for the first time, you realise there's a big divide between the wealthy people and the poor people.

'Hopefully the race here is going to help everyone. It's good to see that we've got a lot of workers here and hopefully that's helping them out in terms of making their life a little bit easier.'

German double world champion Sebastian Vettel caught his first glimpse of Indian life on the 200km drive from New Delhi to the Taj Mahal, and he said it was a humbling experience.

'It definitely brings your feet back on the ground in many ways and makes you understand a lot of things,' he said.

'It's an inspiration and makes you appreciate things you take for granted.'

The jarring spectacle of lavish Formula One coming to Greater Noida, a dusty satellite of New Delhi, has prompted some disquiet.

'I feel very bad because such business has nothing to do with 99 per cent of Indians. It is a criminal waste,' said former Olympic hurdler P.T. Usha, who runs an athletics academy for young Indian women.

'First, Twenty20 cricket spoiled the spirit of Indian sports, and now here comes another avatar which will mostly attract corporate money, who rarely spend for sports promotion. Only God can save Indian sports.'

Shooter Gagan Narang said F1 was out of reach for the vast majority of Indians, as witnessed when organisers had to slash ticket prices to try to fill the 120,000-capacity circuit.

'Let's face it that the sport is not for everyone and only people with money will have access,' he said, according to the Economic Times.

Button's McLaren teammate Lewis Hamilton said Indian fans had shown a passion for F1 - which could translate into big profits for the sport.

'They're incredibly fanatical about it, they're crazy about F1,' he said. 'The energy that I've got from the fans from coming here has been mesmerising.

'They were so excited to see me or touch me or whatever, they were coming over the fences. It was really quite special. I hope we get the same reaction here.'


Euro zone crisis: the Icelandic way

FINANCIAL markets are cheering the deal that emerged from Brussels early Thursday morning. Indeed, relative to what could have happened - an acrimonious failure to agree on anything - the fact that European leaders agreed on something, however vague the details and however inadequate it may prove, is a positive development.
By Paul Krugman

But it's worth stepping back to look at the larger picture, namely the abject failure of an economic doctrine - a doctrine that has inflicted huge damage both in Europe and in the United States.

The doctrine in question amounts to the assertion that, in the aftermath of a financial crisis, banks must be bailed out but the general public must pay the price. So a crisis brought on by deregulation becomes a reason to move even further to the right; a time of mass unemployment, instead of spurring public efforts to create jobs, becomes an era of austerity, in which government spending and social programmes are slashed.


Where everyone else bailed out the bankers and made the public pay the price, Iceland let the banks go bust and expanded its social safety net.Where everyone else was fixated on trying to placate global investors, Iceland imposed temporary controls on the movement of capital to give itself room to manoeuvre.

This doctrine was sold both with claims that there was no alternative - that both bailouts and spending cuts were necessary to satisfy financial markets - and with claims that fiscal austerity would actually create jobs. The idea was that spending cuts would make consumers and businesses more confident. And this confidence would supposedly stimulate private spending, more than offsetting the depressing effects of government cutbacks.

Some economists weren't convinced. One caustic critic referred to claims about the expansionary effects of austerity as amounting to belief in the 'confidence fairy'. Okay, that was me.

But the doctrine has, nonetheless, been extremely influential. Expansionary austerity, in particular, has been championed both by Republicans in Congress and by the European Central Bank, which last year urged all European governments - not just those in fiscal distress - to engage in 'fiscal consolidation'.

And when Mr David Cameron became Britain's Prime Minister last year, he immediately embarked on a programme of spending cuts in the belief that this would actually boost the economy - a decision that was greeted with fawning praise by many American pundits.

Now, however, the results are in, and the picture isn't pretty. Greece has been pushed by its austerity measures into an ever-deepening slump - and that slump, not lack of effort on the part of the Greek government, was the reason a classified report to European leaders concluded last week that the existing programme there was unworkable. Britain's economy has stalled under the impact of austerity, and confidence from both businesses and consumers has slumped, not soared.

Maybe the most telling thing is what now passes for a success story. A few months ago various pundits began hailing the achievements of Latvia, which in the aftermath of a terrible recession nonetheless managed to reduce its budget deficit and convince markets that it was fiscally sound. That was, indeed, impressive, but it came at the cost of 16 per cent unemployment and an economy that, while finally growing, is still 18 per cent smaller than it was before the crisis.

So bailing out the banks while punishing workers is not, in fact, a recipe for prosperity. But was there any alternative? Well, that's why I'm in Iceland, attending a conference about the country that did something different.

If you've been reading accounts of the financial crisis, or watching film treatments like the excellent Inside Job, you would know that Iceland was supposed to be the ultimate economic disaster story: Its runaway bankers saddled the country with huge debts and seemed to leave the nation in a hopeless position.

But a funny thing happened on the way to economic Armageddon: Iceland's very desperation made conventional behaviour impossible, freeing the nation to break the rules. Where everyone else bailed out the bankers and made the public pay the price, Iceland let the banks go bust and expanded its social safety net. Where everyone else was fixated on trying to placate global investors, Iceland imposed temporary controls on the movement of capital to give itself room to manoeuvre.

So how's it going? Iceland hasn't avoided major economic damage or a significant drop in living standards. But it has managed to limit both the rise in unemployment and the suffering of the most vulnerable; the social safety net has survived intact, as has the basic decency of its society. 'Things could have been a lot worse' may not be the most stirring of slogans, but when everyone expected utter disaster, it amounts to a policy triumph.

And there's a lesson here for the rest of us: The suffering that so many of our citizens are facing is unnecessary. If this is a time of incredible pain and a much harsher society, that was a choice. It didn't and doesn't have to be this way.


No house, no bride

BEIJING: Kind. Upright. Career-minded. Loves literature. Such were the top attributes Chinese women wanted in a husband, according to 1980s marriage ads.
By Ho Ai Li, China Correspondent

These days, most women will consider only men who own houses.

In the three decades since communist China embraced the free market and the pursuit of material wealth, property ownership has largely come to be seen as an intrinsic part of marriage - marital unions with no title deeds are deemed incomplete, or in local speak, 'naked'.



What does it take to tie the knot? Here is a look at how changes in Asian societies are having an impact on the institution of marraige.

'I don't have a boyfriend now, but a house must come with marriage. Only then do I feel secure,' said Ms Mi Chunxiao, 22, a receptionist in an estate office.

Her views put her in the mainstream: 60 per cent of 1,000 women polled earlier this year by the Jiayuan match-making website say 'naked marriages' are not for them.

Indeed, 'has house, has car' has become one of the most frequently seen phrases in marriage ads, along with good personality and looks, according to a survey by the Netease online portal.

In the past, houses did not matter that much. At least not in Maoist China when most couples did not have to fret over where to live after marriage as their work units would allocate apartments.

These days, steep residential property prices, especially in the big cities, have meant that housing has entered into marital calculations, especially for women who still tend to earn less.

So much so that a Chinese real estate official was reported to have infamously remarked in 2009 that China's bullish property market was being driven by mothers-in-law who would not marry off their daughters unless the man owned a house.

Mr Xin Yan, 30, an operations manager, explains his plan to make a property purchase first before getting hitched: 'It is customary.'

Even China's laws had to be revised recently to keep up with the changing role of property in marriage.

As much as two-thirds of the 19 new clauses under the Interpretation On Marriage Law released this August concern matrimonial property, noted retired academic Wu Changzhen, who was involved in their drafting.

As China becomes more developed economically, property disputes have become a common feature of divorce cases, but the Marriage Law had little to say on these, she told People's Daily Online.

In particular, one of the new clauses seems to give the men an edge in claiming the house upon divorce. That has sparked an outcry and underscored how property is a big deal in a marriage.

Under the new rule, whoever buys the house owns it after divorce. The party who pays the downpayment for an apartment before marriage is considered the owner even if both spouses pay the housing loan together after marriage.

As men are still more likely to be the ones purchasing the home - due to traditional expectations and their stronger economic position generally - many women feel that they stand to lose out.

'I don't understand why they have to change the law. Women don't have security in a marriage even though they contribute a lot,' said Ms Mi. 'Men tend to become richer as they grow older, women don't and end up losing their youth.'

Like her, nearly 80 per cent of the women polled by a Henan newspaper feel that the new laws are detrimental to the interests of women.

In particular, some women fear it would make it easier for husbands to stray as they no longer have to worry about losing their house after divorce.

'I feel the law should have as its starting point the protection of women and children, and not the eradication of social ills like gold-diggers,' Ms Liu Chen, a 37-year-old homemaker.

Lawyers say the changes are meant to make it clearer who owns what when a marriage breaks up. Divorces have risen from 3.2 million in 2007 to 4.5 million last year. There were 5,000 divorces a day on average in the first quarter of this year.

'Traditionally, the Chinese tend to put more stress on personal relations,' said Beijing-based divorce lawyer Ye Wenbo. 'We feel we are one family after all and don't need things like nuptial agreements.'

This has led to problems over how to divide the assets in a divorce, he added.

The new laws also stipulate that a house bought by one party's parents and given to their child is deemed the sole property of their child and not his or her spouse. This additional amendment reflects the fact that many parents are the ones making the property purchases to set their children up for marriage.

IT executive Deng Zhuo, 30, is all for the change as it would protect the interests of parents who pour their savings into property for their children.

Nor are all women against the new laws. 'It does put a stop to people who are marrying for money,' said a 23-year- old bank teller.

But many insist they will not marry unless their future husbands put their names on the title deeds.

'Because if you love me, you have to give in to me,' said Ms Mi. 'If not, what's the point of marrying you?'

Additional reporting by Carol Feng

Thursday, October 27, 2011

The happiness of a nation

IT IS sad that MP Sylvia Lim's recent call in Parliament for Singapore to measure its sense of well- being (happiness index) degenerated into an off-point discussion on the merits of life in Bhutan and a rejection of her call. Reading her speech, it is clear that life in Bhutan was not what she wanted debated.
By Joseph Chong, For The Straits Times

'Happiness' is currently the subject of significant socio-economic research. Nobel laureate for economics Joseph Stiglitz, among other notable thinkers, has highlighted its importance. Many developed countries are incorporating it into their economic management; even conservative governments in Britain and France are adopting it. Gallup publishes a well-followed well-being index for the United States every month.

Even China is adopting a happiness index. Premier Wen Jiabao recently declared this publicly as a necessity to ensure a more balanced and sustainable development for China going forward.

Happiness is linked to many other socio-economic variables. Many of these are in turn drivers of the policies we have today and may have tomorrow.

My interest in measurements of happiness is personal and occupational. Like many other professional investors, I am interested in the sense of well-being of a society because it correlates to many other economic and social variables which have an impact on return- risk considerations.

Happiness is linked to consumer confidence data published monthly in most developed economies. It is a measure of the propensity to consume and invest going forward. Bond and equity markets are sensitive to readings of consumer confidence.

Happiness is also correlated to fertility rates. My own in-house research has shown how tight the correlation is across countries. This was first published in The Business Times on March 2 (Demographics, fertility and happiness) and can still be accessed freely at

Other researchers appear to have reached the same conclusions. This is not surprising if you see nature in action and zoos' breeding programmes. If you cannot be happy, you are doomed as a species because you will fail to produce enough babies.

Happiness is also linked to other economic variables. My own preliminary internal research indicates correlations with an individual's income growth, inflation rates, societal income inequality (Gini coefficient). Based on Associate Professor Tilak Abeysinghe's work at the National University of Singapore on fertility and housing affordability, happiness is also probably correlated to housing affordability (which is a subset of inflation). Intuitively, we could guess it, but the scientific research is now backing this intuition.

Unfortunately, there appears to be the misconception that happiness is an airy-fairy independent variable.

It is clearly not a stand-alone concept. Mathematically speaking, happiness is a function driven by other variables. In other words, get the other key variables right and the happiness index will take care of itself, because it is an aggregate of these other happiness-inducing factors. One is very unlikely to get a high happiness reading if incomes are falling, inflation is soaring and the rich-poor gap widens.

Happiness also appears to be linked to productivity. Again, this is not surprising, because if you have rising incomes with low inflation, you are getting productivity - which is high-quality economic growth. Given the necessary directional change in Singapore's economic-growth strategy to be more productivity-driven, happiness should be taken seriously.

Economic considerations aside, a sense of well-being or happiness is linked to serotonin levels in human beings. Serotonin is a chemical produced by the body that helps regulate our sense of well-being. Deficiency of serotonin is very clearly linked to mental illnesses, such as depression, anxiety disorders and excessive anger. Elevated serotonin levels make humans more tolerant to mental stress.

This is important in crowded, multi-religious, multiracial Singapore, where intolerance is the major threat to social cohesion. Indeed, being happy makes it less likely that we will have religious or racial riots. Happiness is important for social stability.

However, in the final analysis, the happiness issue is a question of human existence. Surely we live our lives not for the purpose of growing our nation's gross domestic product. Black or white, God-fearing or atheist, rich or poor, our wish to be happy or happier is universal. We are indeed all different as human beings, but we are one in our quest to be happy.

The writer is chief executive officer of financial advisory firm New Independent

Wednesday, October 26, 2011

Repowering US economy: Fix education, not taxes

THE Republican presidential debates have been replete with discussions about our economic future, but to listen to the candidates you'd think that the biggest problem is an onerous US tax code.
By Edward Glaeser

I'm all for sensible tax reform, but prosperity depends far more on our skill base than on cutting tax rates that are already low by international standards. If the Republicans want to battle for a more prosperous, and stronger, country, they must start spending a lot more time fighting the failures of American education.

The attached figure shows the correlation between the logarithm per capita income levels last year and maths Pisa test scores in 2009. The Organisation for Economic Cooperation and Development's Programme for International Student Assessment (Pisa) tests 15-year-olds in a range of generally prosperous countries, and takes on values from 200 to 800 (similar to the maths Scholastic Assessment Test, or SAT). Tests are also given for reading and science - the scores are quite closely correlated across subject area - but the maths results are the best predictor of incomes across countries. I excluded Luxembourg and Liechtenstein because of size, and subnational Chinese areas, such as Hong Kong and Shanghai.


Maths scores and gdp
The graph illustrates that a 46-point test score increase, which is about 10 per cent of the average score across countries, is associated with an increase of more than 90 per cent in country level incomes. The test score variable can explain, in a statistical sense, the lion's share of income differences across these countries.

Although it's sensible to be a bit sceptical about figures like this, there is a long and distinguished literature linking education with economic outcomes at the individual, country and metropolitan area level. Economists have found that earnings rise with education even among identical twins and that randomly getting a better kindergarten teacher produces higher adult earnings.

At the metropolitan level, education predicts earnings growth, not just income levels, and the presence of a land-grant college prior to 1940 is a strong predictor of economic success today.

At the national scale, fears of reverse causality are allayed by the fact that education predicts improvements in income and government quality, but ameliorations in those areas don't predict improvements in education.

All in all, the link between education and prosperity is about as solid as anything in the social sciences.

By contrast, the statistical link between tax rates and prosperity is far weaker. Across countries, incomes are typically higher where governments spend more, as a share of gross domestic product. This is known as Wagner's Law, and it doesn't mean that big government increases prosperity, because government spending is primarily reflecting, not causing, high incomes.

But empirical studies, compromised by a host of tricky statistical issues, have typically found a murky relationship between government size and economic growth. US tax cuts also typically appear to have modest impacts on economic activity.

This may not be surprising because America's tax rates are already low relative to world standards.

Similarly, the US' economic problems don't primarily reflect deficient infrastructure or too expensive energy or the actions of the Environmental Protection Agency.

I support smart reform in all these areas, but if we fail to address the primary issue - our skill deficit - we're fiddling while the country declines. Indeed, the figure shows that US wages are already high relative to our skill levels. The big challenge is to ensure that Americans have the tools to thrive in an information age.

Current Pisa maths scores put the US in the middle of the pack. We're on a par with Portugal, ahead of Italy and Azerbaijan, and behind Hungary and Slovenia. We're far behind countries such as South Korea and Singapore.

Why should we expect an American with limited skills to earn dramatically more than an equally skilled counterpart in China or India? An American consultant doesn't expect to earn a wage premium for advising an Indian company just because she's from the US.

People who sell their time through the online marketplace Amazon Mechanical Turk can't expect to earn more because of their location. Place matters - we're still educated by the people around us. The importance of having smart neighbours explains why cities such as Seattle, Minneapolis and Boston continue to thrive.

But proximity is worth less and less if you aren't learning from the people around you. Once upon a time, Americans could expect to earn more than equivalently skilled Asians or Europeans, because of our natural resources and a government that was exceptional in its stability, rule of law and embrace of capitalism.

Today, there are plenty of countries where entrepreneurs can thrive.

The would-be Republican candidates all champion enduring American greatness, but how can that greatness persist unless the US is one of the most skilled countries on the planet? The 20th century was America's century in part because Americans were so well educated.

Americans will earn what our talents produce. Any Republican or Democrat who wants to repower our economy must recognise that the nation's future depends on its human capital, far more than infrastructure or energy or finagling with the tax code.

The writer is an economics professor at Harvard University and a Bloomberg View columnist.


Monday, October 24, 2011

Asia's next battleground: Water

NEW DELHI: It may seem odd to talk about it at a time when television screens are filled with scenes of the worst flooding that Bangkok has suffered in 50 years.
By Ravi Velloor, South Asia Bureau Chief

But a new book by a respected voice on Asian strategic affairs warns that a scarcity of water is set to become Asia's most defining crisis by the middle of the century, one with the potential to trigger major conflicts.

As Asia continues to live beyond its means where water is concerned, accentuating its scarcity, disputes and competition over bodies of water that cross the boundaries of various countries pose a greater threat to peace and stability in a continent already marked by festering territorial and resource disputes, Professor Brahma Chellaney says in the first such wide-ranging study on water and peace.


Access woes

ASIA has less fresh water per capita than any other continent. Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and Sri Lanka account for more than 21 per cent of the world's population, yet make do with 8.3 per cent of global water resources.

China and India make up 37 per cent of the world's population, yet have access to less than 11 per cent of global water resources.

Asia's water efficiency and productivity levels are among the lowest in the world. Inefficient water practices are compounded by a rising consumer class that uses water-guzzling comforts such as washing machines while eating more meat, which is notoriously water intensive to produce.

Asia has 57 transnational river basins. China is the source of cross-border river flows to the most number of nations like Russia, India, Kazakhstan and Vietnam.


S'pore and water

SINGAPORE has consciously set itself the goal of becoming the hub of water technology for Asia, thanks to fears that Malaysia may one day cut off its water supply, says Professor Brahma Chellaney of New Delhi's Centre for Policy Research.

Besides expanding alternate sources of supply, by removing salt from sea water and building huge catchment reserves, it has pursued demand management through greater water productivity and efficiency.

By plugging system leaks and inefficiencies and raising the price of domestic water, it has managed to reduce household water use by about 10 per cent since the mid-1990s to about 155 litres per person a day this year, he notes.

Add to this the fact that people are using more water and Asia is expected to bear the greatest impact of global warming, and the region faces an incendiary situation.

'National reliance on oil can be reduced through other sources of energy,' Prof Chellaney says in Water: Asia's New Battleground. 'There is no such hope with water. Water has no substitute.'

Worries over water have begun to manifest in myriad ways across Asia.

Pakistan has sought international arbitration to stop India's run-of-the-river projects upstream on the Indus River, despite a treaty signed in 1960 that has survived even the worst lows in their bilateral ties.

India itself never fails to raise its concerns with China about its plans to build the world's biggest dam along the Brahmaputra River, which originates in Tibet and flows through India before reaching Bangladesh.

Indochinese states are warily watching China's massive river engineering plans to take moisture to its parched regions by diverting water from elsewhere.

In West Asia, some disputed or occupied territories such as the Golan Heights and the West Bank draw their strategic value as much for their water wealth as their advantageous location.

Prof Chellaney of New Delhi's Centre for Policy Research says the forestalling of water wars demands a cooperative Asian framework among river basin states, so that they work towards a common ownership of shared resources and share the benefits securely.

In this context, he points out, no country is more central to the issue than China, which has been noticeably cool on a multilateral approach to water, as, for instance, at the Mekong River Commission.

Smaller states, for this reason, fear that China may be following a strategy of 'divide and conquer'.

'No other country in the world matches China's position as a multi-directional, transboundary water provider,' says Prof Chellaney. 'Significantly, the important international rivers of China all originate in ethnic- minority homelands, some of which are racked by separatist movements.'

He says China's increasing assertiveness on such issues will prompt a number of regional actors to form a web of interlocking partnerships to act as a discreet check on its exercise of power.

'As the dispute over the South China Sea shows, this may actually bring other claimants together in opposition to Chinese policy and make them turn to the United States for security assurances,' he says.

That said, it will be impossible to turn the competition for water into cooperation without China's active support for sub-regional water sharing and cooperative-management mechanisms. But for that to happen, China will need to drop its allergy to terms such as 'internationally shared water resources' and for legally binding accords on water.

Prof Chellaney says: 'To cite one example, China needs to go from being a 'dialogue partner' to becoming a member of the Mekong River Commission, so that it can work with its (neighbours)... on a water management plan for the mutual benefit of all.'

Sunday, October 23, 2011

The rise of Asia's middle class

Companies rub their hands with glee when they think of Asian consumers.

Dr Bala Shankar, an adjunct professor at Singapore Management University, recently wrote: 'Asia is home to nearly four billion consumers, more than half the world. If the predictions that China and India will overtake many of the Western nations in GDP terms come true, it could be the largest bonanza for the marketers.'

The key is the rising middle class.

The rise of Asia's middle class
While there is no standard definition or measurement of the middle class in Asia, whether it is by income or consumption, whatever it is, the figures show the middle class is growing, and fast.

In its report, Imagining Asia 2020, DBS Bank defines the middle income group as those individuals who spend more than US$10 (S$13) a day.

By that measure alone, Asia today has a middle class of 525 million people. They make up 28 per cent of the world's middle class, said DBS.

This is projected to expand significantly to an incredible 1.74 billion people over the next 10 years.

They will then make up half of the middle class population in the world.

It's not just a China and India story but one of South-east Asia too.

'Over the next nine years, Malaysia and Thailand will see a significant increase in the number of people who will spend more than US$10 a day,' DBS said.

The growth of the upper middle class in China will surge from 80million in 2010 to 208 million by 2020.

As Asia's middle class grows, so will its demand for goods and services.

'The rising middle class will be a significant factor in reshaping national economies. They will be an influential and profitable market segment thanks to their size and emerging buying power,' noted DBS.

No wonder consumer giants like Procter & Gamble and Unilever have set up headquarters in Singapore to be closer to the Asian market.

They also have innovation centres to provide products specifically for different Asian tastes and preferences.

An example Economic Development Board chairman Leo Yip likes to cite is that the thickness of Asian hair is not the same as that of European hair, so shampoos sold in Asia must be made with different levels of conditioner.

According to DBS, global demand from the middle class will expand from US$21 trillion to US$35 trillion by 2020.

Over 70 per cent of this growth in demand will come from Asia.

How will this burgeoning middle class spend its money?

Middle class families generally have fewer children and spend more on health care, nutrition and education than the poor do, according to DBS.

Asia's middle class will be similar, influencing how their new money will be spent.

'Having fewer children would give middle class parents greater ability to afford quality education for their children,' said the DBS report.

'More women would also be more likely to rejoin the workforce. Additionally, families would have more opportunities for savings and personal consumption.'

Durable goods

For a start, there will be much more demand for durable goods such as refrigerators, cars, television sets and mobile phones.

Just take a look at these numbers for the mobile phone market: China already has some 780 million mobile phone subscribers. In India, there has been a significant growth of 66 per cent in the number of mobile phone users from 2000 to 2010.

But these figures represent only about half of the population in these countries, which means China and India still have substantially untapped markets.

While the middle class is growing, the more impressive expansion will come from the income groups of those earning between US$4 and US$10 a day, especially in Indo-nesia, Vietnam, India and China, said DBS.

They will also demand goods and services but at a cheaper price, which will in turn drive the search for innovative solutions to achieve this.

Godrej, an Indian manufacturer, is one such company, selling refrigerators for just US$70.

Other companies, such as Unilever, sell 10-cent shampoo and conditioners.

Education and health care

It is not just demand for goods that will rise. The middle class will also be willing to spend more on important services such as education and health care.

DBS said the middle class in Thailand spends about 4 per cent of its income on these two services. This is more than double what the lower-income group is willing and able to spend.

The Chinese spend the higher proportion of their income on education and health care.

This will in turn drive demand for infrastructure - more schools and hospitals.

Cars and property

China's car market is already the largest in the world, overtaking the US' two years ago.

An incredible 18 million cars were sold in China last year. DBS forecasts car ownership to grow further as incomes rise, more roads are built and car makers aggressively roll out new designs for the Chinese market.

By 2020, two out of every 10 Chinese will own a car.

This means that total sales will surpass 30 million by 2020 at a growth rate of 5.3 per cent.

In South-east Asia, car demand is expected to grow at an even faster pace. DBS expects car ownership to grow from the current 9 per cent pace to about 10.5 per cent, and at a similar rate each year from 2010 to 2020.

Housing demand in Asia is forecast to grow from a market value of US$694 billion last year, to US$1.1trillion by 2020, said DBS.

It calculated that 16.5 million property deals will be transacted in China, Indonesia, Hong Kong, Singapore, Thailand and Malaysia.

The populations of these places combined make up a quarter of the world's total population.

These figures will be music to the ears of property developers, who will be able to offer a wider supply of properties catering to different income groups.

'The pace and pattern of this growth will vary according to market development and demographics in each country,' said DBS.

In China, it will be driven by low ownership levels, urbanisation and a high incidence of people in the home-owning age range.

In countries such as Indonesia and Malaysia, it will be sheer demand for housing, as people under 25 make up about 46 per cent of the population and will soon progress to the home ownership age.

Energy and commodities

China today consumes four billion barrels of oil a year of the 6.9 billion barrels consumed in Asia a year. This is second only to the US' seven billion barrels each year.

By 2020, China is expected to raise its consumption to 4.3 billion barrels a year.

By 2035, it will account for more than a fifth of total global oil demand, up from 17 per cent today.

With energy-hungry China and India, coal demand is also expected to remain high, and grow at an 8 per cent annual rate until 2020, said DBS.

But don't expect Asia to become much greener. Renewable energy is unlikely to be able to make up for much energy demand by 2020. Coal power plants are still estimated to account for more than 70 per cent of power generation, said DBS.

Palm oil and rubber will also be in hot demand in Asia.

'It will be home to 86.3 per cent of the 81.7 million tons of global palm oil supply, and 95 per cent of the 15.5 million tons of global natural rubber supply over the next eight years,' said DBS.

10 scandals that shocked and shamed China

1. Killer milk

China's biggest food scandal left at least six infants dead and hundreds of thousands of other children with kidney problems after they drank milk adulterated with melamine, a chemical used to make plastic.

Dairy producers had added the substance to artificially boost protein content and increase profit. News of the milk scandal stunned a nation which had just celebrated the success of the 2008 Beijing Olympics.

A volley of questions followed from angry Chinese citizens, a key theme of which was whether the national obsession with wealth had destroyed all sense of morality, opening the way for people who had no compunction about killing babies for a fatter profit margin.

Officials were sacked and a few other culprits executed and jailed. But Beijing has since cracked down on the parents' protests and even jailed one of them, Zhao Lianhai.

2. Death of a 'vagrant'

In 2003, 27-year-old Hubei graphic designer Sun Zhigang was arrested in Guangzhou, after he failed to produce his local residence permit. Without his papers, he was assumed to be a vagrant and taken to a detention centre. He died three days later, an apparent victim of police brutality.

His death triggered a huge outcry and focused national attention on the shoddy treatment of China's underclass, which includes not just beggars but also migrant workers. Reports surfaced of other police abuses, including making money off their detainees by selling their services as unpaid labour.

Public anger led the State Council to rescind a 1982 law that allowed police to detain people who fail to produce local residence permits.

3. Better dead than injured

Chinese student Yao Jiaxin, 21, hit waitress Zhang Miao with his red Chevrolet last year when she was cycling home from work in Xi'an.

Fearing that the injured woman would seek compensation, he then stabbed her to death. He confessed he murdered her because he feared the 'peasant woman would be hard to deal with' over the accident.

Yao was executed by lethal injection this year. His case highlighted a quirk in China's traffic laws which has serious unintended consequences: If the victim dies, the driver responsible is required to fork out a lump-sum payment in compensation, but if the victim lives, the driver has to pay all the medical fees arising from the accident for the rest of the victim's life.

Yao, who reversed his vehicle and ran over Ms Zhang a second time before stabbing her, allegedly told the local media: 'If she is dead, I may pay only about 20,000 yuan (S$4,000). But if she is injured, it may cost me hundreds of thousands of yuan.'

The fear of being saddled with huge, seemingly endless payments was underscored yet again with the incident involving Yue Yue, the toddler who died last week.

4. Brick kiln slaves

The country was shocked that slavery, abetted by government officials even, still existed when hundreds were rescued from forced labour in brick kilns in northern Shanxi province.

Many of the slaves were abducted as children. They had little to eat, and beatings and other forms of abuse were frequent. Guard dogs prevented their escape while police in cahoots with local officials obstructed attempts by parents to locate their missing children.

Such scandals did not end in 2007. Another case was uncovered last week.

5. Unlucky Samaritan

Technician Peng Yu helped an elderly woman up on her feet after she stumbled and fell while jostling with a crowd that was trying to board a bus in Nanjing in 2006.

She later accused him of causing her to fall, and sued him. The judge ruled in her favour, saying common sense dictated that only the person responsible for the act would offer a helping hand.

The verdict led to an uproar about warped legal outcomes. Even now, it is often cited as the reason the Chinese are wary about helping strangers in need.

6. Burying a train

A day after one of China's biggest rail accidents which left at least 40 people dead, officials swiftly buried parts of the wreckage and called off rescue operations.

The unseemly haste was underscored by the discovery of a little girl among the ruins a day after the order was issued. The perceived cover-up and mishandling of the Wenzhou accident in July stoked massive outrage among netizens and other commentators.

State media launched a rare and concerted attack on the authorities, pressing for answers and accountability. The results of the official investigation have not been released.

7. Heroine killer

When a local official in central Hubei province tried to force himself on Ms Deng Yujiao, 21, a pedicurist at a hotel in 2009, she grabbed a knife and stabbed him to death.

The outpouring of sympathy for her and anger towards the official became so strong that she was eventually released without punishment.

The strong public reaction tapped into growing resentment among ordinary Chinese towards corruption and other official misconduct.

8. Vigilante justice

Yang Jia, an unemployed man, was a ruthless killer who charged into a police station in Shanghai in 2008, throwing petrol bombs and stabbing six policemen to death.

But the Beijing man, who was taking revenge for being beaten by the police earlier, was hailed by many Chinese as a hero.

He was likened to ancient Chinese heroes who sought vigilante justice as netizens expressed outrage at the police brutality they often witnessed in China.

9. The infamous son

Drunk driver Li Qiming knocked down two university students on campus last year, killing one of them.

When security guards tried to stop him from fleeing the scene, he shouted: 'Go ahead, sue me if you dare. My dad is Li Gang!'

Li senior was the deputy director of the local public security bureau in Baoding, northern Hebei province.

Fierce protests online ensued, with many slamming it as an example of officials' offspring, the so-called guan er dai, abusing power and believing that they are above the law.

Li Qiming was sentenced to six years in jail.

10. Burning issue

The cost of China's rapid development took a fiery twist in 2009 when Madam Tang Fuzhen set herself on fire in an attempt to stop the forced demolition of a private building.

The self-immolation in Chengdu, Sichuan province, was filmed on a mobile phone and spread quickly online.

It created a furore over China's demolition law and the forced demolitions which are prevalent across the country, often incurring the ire of the people because of inadequate compensation and the use of thugs to evict residents.

Saturday, October 22, 2011

The Long March: China's founding myth

SEVENTY-FIVE years ago today, China's Red Army, the predecessor of the People's Liberation Army, ended its Long March, a storied, 24-month retreat from the Nationalist Army's often, near-successful attempts under Chiang Kai-shek to crush the communist revolution. On Oct 22, 1936, the Red Army's three main units - the First Front Army, Second Front and Fourth Front - came together at Huining in Shaanxi province.
By Anthony Paul, For The Straits Times

There was some early debate about when the Long March ended. The First Front Army, Mao Zedong's central force, was able to stop marching and fighting a year earlier in Wuxi, about 120km away. But Mao settled the matter: Huining was, he declared, 'Peace Town'. It was the place where 'the Red Army's union heralds peace for China'.

As it happened, real peace was a long time coming. First, it took until 1945 before a Japanese invader could be expelled. In Beijing, in October 1949, Mao announced the formation of the People's Republic. Two months later, Chiang, who was then in Chongqing, fled to Taiwan to rejoin his remnant forces. Apart from sporadic aerial and naval encounters and skirmishes between special forces, the last time that communist and nationalist units fought was in 1950. The civil war has never officially ended, though tourists from both the mainland and Taiwan are now a common sight all over China.


A friend of Mao's is reported to have heard him say that Snow's book 'had a merit no less than that of the Great Yu, the mythical emperor who was supposed to have brought China's floods under control and saved the people'.

The fledgling People's Republic, anxious to build a new, party-centred nationalism for China, soon set about glorifying the Long March. They had a lot of propaganda material to use and went about making the most of it. At the core of the effort was a famous book of the late 1930s - Red Star Over China by Edgar Snow (Random House, 1938).

Snow was just 30 when he produced this classic. Born in Kansas in the United States, he had spent seven years in China, five of them as a correspondent for a then prestigious US magazine, the Saturday Evening Post. He and his wife lived for much of the time in Beijing - near Yenching University, then a leading Christian missionary college that was eventually closed by the communists and merged with Peking University.

The Snows were not communists but they spent time with student activists and were aware of the Chinese Communist Party's policies and motivations. But like most of the world, including China itself at that time, they had little knowledge of Mao, the Red Army or Mao's determination to mobilise the rural masses.

Helped by contacts with a warlord's army in Xi'an, Snow was able to cross communist lines and meet Mao, at a time when the party's reclusive chairman had decided to put himself on record.

Snow's reports created something of a sensation. In Britain, the book sold more than 100,000 copies in the first few weeks of its launch. Many young Chinese radicals, including Jiang Qing, a Shanghai actress who would become Mao's wife, joined the communists in Shaanxi after reading it.

Said Harvard University professor John Fairbank in an introduction to one of the many later editions of the book: 'The remarkable thing about Red Star Over China was that it not only gave the first connected history of Mao and his colleagues and where they had come from, but it also gave a prospect of the future of this little-known movement which was to prove disastrously prophetic.' (Prof Fairbank wrote this in 1968, when US-China relations were at a very low ebb.)

Mao remained grateful to Snow for the portrait shown in the book. Was it altogether accurate? In a word, no.

One example among many available: Snow described the Red Army's seizure of a chain bridge over the Dadu River in western Sichuan province as 'the most critical single incident of the Long March'. In a chapter he titled The Heroes Of Dadu, he breathlessly recounts the reaction of the Sichuanese defenders of the bridge as just 22 Red soldiers raced across it to press an attack against a regiment: 'Were (the Reds) human beings or madmen or gods?'

Unfortunately for him, we now have paramount leader Deng Xiaoping's own frank footnote to the history of the operation. During a visit to China in the 1980s, former US national security adviser Zbigniew Brzezinski told Deng that he went to the Dadu bridge and had been impressed by 'the great feat of arms'. Deng smiled and said: 'Well, that's the way it's presented in our propaganda. We needed that to express the fighting spirit of our forces. In fact, it was a very easy military operation. There wasn't really much to it. (On) the other side were just some troops of a warlord who were armed with old muskets, and it really wasn't that much of a feat, but we felt we had to dramatise it.'

Over the years since, countless documentaries, plays and movie scripts have turned the action into a centrepiece of modern Chinese history. Across The Dadu River is a popular song from the Chinese musical, The East Is Red.

Mao's gratitude is on the record. A friend of his is reported to have heard him say that Snow's book 'had a merit no less than that of the Great Yu, the mythical emperor who was supposed to have brought China's floods under control and saved the people'.

That Snow saved the people may be debatable. That the founding myth of the Long March helped to create a 'New China' would be easier to argue.

This curious retreat into victory ended just 75 years - only three generations - ago today. Pondering the latest growth statistics, we sometimes forget just how quickly a changed China has reversed its fortunes.

Conflicting accounts over how Gaddafi died

MISRATA (Libya): Muammar Gaddafi's last moments on Thursday were as violent as the uprising that overthrew him.

In a cellphone video that went viral on the Internet, the deposed Libyan leader is seen splayed on the hood of a truck and then stumbling amid a frenzied crowd, seemingly begging for mercy.

He is next seen on the ground, with fighters grabbing his hair. Blood pours down his head, drenching his golden brown trousers, as the crowd shouts 'God is great!'

Gaddafi's body was shown in later photographs, with bullet holes apparently fired into his head at what forensic experts said was close range, raising the possibility that he was executed.

The official version of events offered by Libya's new leaders - that Gaddafi was killed in a crossfire - did not appear to be supported by the photographs and videos that streamed over the Internet all day, raising questions about the government's control of the militias in a country that has been divided into competing regions and factions.

The conflicting accounts of how he was killed seemed to reflect an instability that could trouble Libya long after the euphoria fades over the demise of the 69-year-old leader, who ruled Libya for 42 years.

At the same time, the flood of good news for the former rebels prompted a collective sigh of relief and quieted talks of rivalries, as strangers congratulated one another in the streets.

Attempt to flee ends in violent death

For weeks, as the fight for Sirte, Gaddafi's home town and final redoubt in the eight-month conflict, reached a bloody climax, Nato forces and Libyan fighters watched for an attempt by his armed loyalists to flee and seek safety elsewhere.

Soon after dawn, they did. Around 8.30am, a convoy slipped out of a fortified compound in Sirte, the scene of one of the civil war's bloodiest and longest battles, and a city that was on the verge of falling to Gaddafi's opponents.

Before the convoy had travelled about 3km, Nato officials said, it was set upon by a US Predator drone and a French warplane. With the attack, the convoy 'was stopped from progressing as it sought to flee Sirte but was not destroyed', French Defence Minister Gerard Longuet said.

Only two vehicles in the convoy were hit, neither carrying Gaddafi, a Western official said. But the rest of the convoy was forced to detour and scatter. Anti-Gaddafi fighters rapidly descended on the scene, saying they saw people fleeing on foot through some nearby woods and gave pursuit.

Interim Prime Minister Mahmoud Jibril said Gaddafi was discovered with a group of supporters in a sewage pipe near a highway, armed with a pistol and wearing trousers and a long underwear shirt, a far cry from his famously flamboyant outfits. He did not resist arrest.

'What is happening?' the former leader was quoted as saying as he came out.

Al-Jazeera also quoted one fighter as saying that he begged for help. 'Show me mercy,' he was said to have cried.

As Gaddafi was being escorted to a truck, however, he was shot in the right arm in an exchange of gunfire between his supporters and the revolutionary fighters, Mr Jibril said.

The truck then got caught in crossfire as it headed towards a hospital, and Gaddafi was shot in the head, Mr Jibril said. 'That was the deadly shot.' The former leader died shortly thereafter.

But cellphone videos showed Gaddafi being loaded on a truck, blood spattered on his face and chest, suggesting he was wounded before boarding the truck.

In the video, one fighter is seen pulling his hair, and others beating his limp body. Two fighters interviewed by Al-Jazeera said that someone struck Gaddafi's head with a gun butt.

'We got you!' the fighters in camouflage yelled as they crowded around the wounded former leader.

By all accounts, Gaddafi's body was taken to Misrata, a coastal town to the west that fought perhaps the most ferocious battle against his regime and whose fighters still celebrate their reputation for martial prowess.

Ms Holly Pickett, a freelance photojournalist working in Sirte, reported in a Twitter feed that she had seen the body in an ambulance headed for Misrata, along with 10 fighters inside with him. It was unclear from her posting whether he was dead at the time.

'From the side door, I could see a bare chest with bullet wound and a bloody hand. He was wearing gold-coloured pants,' she said in one Twitter post.

No videos or photos appeared to show Gaddafi alive after he was spirited away from Sirte.

A reporter accompanying Mr Ali Tarhouni, the interim government's finance minister who visited Misrata to view the body, saw it splayed out on a mattress in the reception room of a private home, shirtless, with bullet wounds in the chest and temple, and blood on his arms and hair.

A doctor took samples of Gaddafi's DNA, blood and saliva to confirm his identity, Mr Jibril said. The doctor also clipped off pieces of the former dictator's hair, only to discover he was wearing a wig, according to the Prime Minister.

A secret burial is expected for Gaddafi, but one official indicated yesterday this may be delayed for a few days.


In life a tyrant, in death strangely human

IF ANYTHING could humanise Colonel Muammar Gaddafi, it was the before-and-after drama that emerged as images of the fallen dictator flooded Twitter, the Internet and cable news.
By Philip Kennicott

One early bit of data pinging out of Sirte looked like a screen grab from a cellphone video, filled with telltale markings that suggest but do not assure authenticity: a time-and-date stamp, battery-level indicator, elapsed-time bar and play button on the bottom.

The dead Col Gaddafi was seen with half-open eyes, as if staring at the camera, bloodied but ashen, looking hauntingly like himself, but with the odd, theatrical mask of a white-faced geisha. It felt real, but it had a strange, too-concentrated emotion.

No matter how loathsome, a powerless person looking straight into the camera almost inevitably becomes sympathetic.

The images of the dead Col Gaddafi were reminiscent of a photo of Romanian dictator Nicolae Ceaucescu taken after his hasty execution in 1989. Captured with his eyes open, the grey-haired tyrant looked natty in a red tie and blue jacket, and strangely handsome in a way that almost erased the memory of decades of brutal rule. It was an accidental envoi, an uncanny post-mortem appeal.

Anyone new to the story - seeing just that image of Col Gaddafi's lifeless face, with memories of the fake digital death mask of Osama bin Laden that surfed the same networks of information and falsehood - has reason to be sceptical.

But there was also a video of what appeared to be Col Gaddafi's bloodied body, filmed in the crowds-and-power style of accidental verite - with the jerky camera, the bad focus, and the manic efforts to frame and hold the image as humanity surges around the event.

Authenticity in the digital age is all about the feel of the image, the drama of how it seems to have been made. Anything can be faked in our wag-the- dog world, but it is hard to fake this well this quickly. An image feels true not because it looks true (that is easy to do) but because it arrives in a way that feels true.

The need of angry Iraqis to see Saddam Hussein's execution might lead one to doubt the truth of the grainy film apparently captured during the execution. But it felt true because it seemed authentically purloined.

Perhaps the bloody face of the terrorist leader Abu Musab al-Zarqawi, triumphantly displayed by the United States military after he was killed in 2006, was mocked up with Photoshop. But the beleaguered Bush administration's ham-fisted effort to celebrate Zarqawi's death like a war trophy - enlarging the photo, matting and framing it for a press conference - somehow made the image seem more genuine.

More is more, and speed matters in the authenticity game of digital imagery. The self-reinforcing surge of Gaddafi images and video erased doubts. News websites and television called it for death, the headlines went big, the scrolling ticker was scrubbed of equivocations.

But Al Jazeera was also showing Col Gaddafi alive, in a video apparently taken just before he was killed or expired from his wounds.

The flood of information on television always confuses our sense of tense, but this simultaneity of death and life changed everything. The death footage was no longer about forensics, proving that a bloodthirsty man has been killed. An image of a corpse is a data point. An image of a living man juxtaposed with an image of his corpse is a drama.

Everything in between is left to the imagination, and in that gap even a thug whose monomania brought death to people as far away as a small town in Scotland and a discotheque in Germany can suddenly seem human.

Split screens on television filled in the gap: Crowds of young men, pumped with the ecstasy of victory, tearing at the fallen regime's green flag with knives, shredding pictures, firing guns into the air.

How did Col Gaddafi die? It is not hard to imagine.

The missing images, paradoxically, become iconic. That gap, if it remains a gap, is almost assuredly being pondered in a sleek, brooding, hilltop palace above Damascus where another murderous leader hangs on to power, by nervous elites in Bahrain and an erratic old man in Yemen.

But the gap that now stands in for the unknown manner of Col Gaddafi's death will also be a volatile part of the founding mythology of the new Libya.

Will it be a nation of laws or passion? Order or retribution?

The speed with which the Gaddafi drama unfolded, the rapidity with which life-and-death images arrived, the chaos of their cinematography, and the uncontrollable speed of a crowd of angry men all reinforced an underlying sense that there is a horrifying truth yet unseen.

Judging an angry crowd, exhausted by oppression and months of revolution, is like judging the weather. What happened between Col Gaddafi alive and Col Gaddafi dead has happened thousands of times, all over the world, for millennia. Watering the tree of liberty with the blood of tyrants is as much a part of United States history as it is now a part of the new Libyan nation.

We have, of course, mostly forgotten the flinty words of Thomas Jefferson, who wrote about tyrants and liberty in an age before photography, with its power to change the valence of man's past and keep his most pathetic moment forever in the present.

Amnesia and ideology helped a nation forget the oldest rule of politics: In the beginning was violence. But that was before the indelible, perpetual infinity of the digital image.


Friday, October 21, 2011

Yue Yue

“Yue Yue was consumed for a week by the fake kindness of netizens... All the wishes are fake and only the 18 passers-by are real. Farewell, and do not be born in China in your next life,” another weibo user wrote.

Help me up... so I can sue you

THE story of Peng Yu and Xu Shoulan is not part of China's rich collection of ancient folk tales, but most Chinese are familiar with it nonetheless.
By Peh Shing Huei, China Bureau Chief

In 2006, Mr Peng, a 26-year-old technician from Nanjing, went to the aid of Madam Xu, 65, who had fallen and broken her hip during a scrum to board a public bus. He took her to hospital and even gave her 200 yuan (S$40).

She returned the favour by accusing him of causing her fall and suing him.

Mr Peng insisted that he helped the elderly woman out of kindness, but the Nanjing court decided otherwise. It ruled in favour of Madam Xu, arguing that Mr Peng would not have helped her if he had not caused the fall in the first place.

He was ordered to pay part of her medical bill, which was eventually settled at 10,000 yuan.

The incident has since grown in notoriety nationwide, and the so-called 'Nanjing Peng Yu case' is often used to explain why many Chinese are reluctant to help strangers.

In the past week, this has seen renewed attention following the ghastly hit-and-run case in Foshan, Guangdong province, involving a two-year-old child. The little girl was struck first by a van on a market street.

As she lay bleeding, 18 passers-by ignored her. She was run over a second time by another vehicle before a rag collector finally pulled her out of harm's way.

Even as an outraged nation threw up its hands in horror, many Chinese were quick to point out that the bizarre outcome of the 2006 case had much to do with the callous attitude of the bystanders.

'The old lady of Nanjing had shoved aside all Chinese people with conscience,' wrote commentator Li Nuoyan on Phoenix News' website. 'It was an ending which no one had expected and a conclusion which terminated the conscience of countless people.'

News reports and netizens have also cited numerous examples of similar incidents since 2006 to show how the Nanjing ruling has had a chilling effect on potential Good Samaritans.

One happened late last year, when a 78-year-old man was found face-down on the ground in a residential compound in Shenzhen. No one offered to help and he died eventually. A security guard who could have saved him said he was afraid to do anything for fear of being blamed.

Another, in August last year, saw an 81-year-old woman accuse a bus driver of having knocked her down and caused her injuries - after he tried to help her after a fall. Fortunately for the driver, his vehicle was equipped with a video camera and he was exonerated by its recorded images.

Indeed, a recent online poll found that 84 per cent of Chinese respondents would not offer to help someone who had fallen on the street for fear of extortion, according to the Global Times.

This unwillingness to help becomes even more stark when set against the widely reported case last week of an American tourist who dived into the famous West Lake in Hangzhou and saved a Chinese woman from drowning.

Many praised the foreigner, but quite a few remarked that the rescuer was very likely ignorant of the risk of being sued which her act of heroism carried. As one netizen put it: 'According to Chinese laws and regulations, if she hadn't pushed the girl into the water, why would she save her?'

But to pin all the blame on the Peng Yu case is reductionist and unfair. Some observers take a longer view, attributing the apparent lack of compassion for others to factors that have moulded Chinese society over the past decades.

They point to the spiritual void left by Mao Zedong's communist triumph, the aversion to standing out and drawing attention to oneself following the trauma of the Cultural Revolution in the 1960s and 1970s, as well as the emphasis on material gain in the past three decades. The headlong rush for economic growth came at a price: an erosion of a sense of community and weakened moral bearings.

This is not to say that Chinese society is devoid of kind-hearted souls, or that there is something intrinsically selfish about the Chinese people. Mr Peng and Madam Chen Xianmei, the woman who rescued Wang Yue, the Foshan toddler, are examples to the contrary.

China is also not the only place that has seen egregious examples of bystander indifference. In 1964, the infamous Kitty Genovese murder case left New Yorkers soul-searching as to what was wrong with a society that allowed a young woman to be stabbed to death outside her Queens apartment while 38 witnesses did nothing.

More recently, in 2008, Jamaican woman Esmin Green died after she collapsed and went into convulsions while waiting for treatment in a Brooklyn hospital. Camera footage showed her lying on the floor for an hour, all the while ignored by other patients, security guards and hospital staff.

China may not be unique, but there is certainly scope for action in the wake of the Foshan case. The authorities, for instance, should come up with laws to protect from liability people who go out of their way to help strangers in distress.

Existing models are to be found in the Good Samaritan Protection Act in California and some European countries. The details differ but the essence is the same: to overcome reluctance to help a stranger that stems from fear of being sued.

Local media reported last month that Shenzhen is drafting similar legislation. It could not come sooner. In fact, other cities and the central government should consider doing the same.

It would be wise, too, to revisit the Peng Yu verdict. As a commentary in the China Daily pointed out last month: 'The Peng Yu case is so influential that it needs to be seriously reviewed... the case is no longer an ordinary one. It has greatly affected our social ethics. The supreme authorities must give due importance to it.

'If our judicial apparatus cannot protect justice, our society will be irredeemably damaged.'

Gaddafi's death ends trial debate

LONDON: Colonel Muammar Gaddafi's apparent death from wounds received during the fall of Sirte means a long and complex trial that could have divided Libya and embarrassed Western governments and oil companies will be avoided.

A senior National Transitional Council (NTC) military official yesterday said the former Libyan leader died after capture, having earlier been injured in a Nato air strike on a convoy fleeing the town. Earlier reports and rumours of his capture had sparked celebrations across Libya and helped oil prices lower.



'It is hugely symbolically important... It helps the NTC move on. If Gaddafi has been killed, instead of captured, that means they will also avoid a long, drawn-out trial that could have been very divisive and revealed awkward secrets.'

Middle East analyst Alan Fraser from risk consultancy AKE, on how the death of Col Gaddafi helps the transitional government in Libya

Had he been taken alive, there would have been potentially acrimonious debate over whether he should be tried in Libya or extradited to the International Criminal Court, which issued a warrant for his arrest along with that of his oldest son and spy chief earlier this year.

Any trial might have given the flamboyant, often idiosyncratic, Col Gaddafi a podium from which to harangue both Libya's new rulers and Western powers, as well as potentially try to embarrass them on issues they would rather forget. As Libya was nudged back from international isolation in the last decade, international oil companies signed deals with it worth billions.

But worse still for the transitional government and Nato, analysts say, would have been for Col Gaddafi to have remained at large, perhaps simply disappearing into the Sahara to form new militias and destabilise Libya and its neighbours.

'It is hugely symbolically important,' Middle East analyst Alan Fraser, from risk consultancy AKE, said of the killing.

'It helps the NTC move on. If Gaddafi has been killed instead of captured, that means they will also avoid a long, drawn-out trial that could have been very divisive and revealed awkward secrets.'

Human rights groups had long said it was important for the former Libyan leader to be held to account, and any local trial would have offered Libya's new government a chance to showcase its improved accountability.

But critics complained that many internationally and locally organised war crimes trials can sometimes turn into long, drawn-out legalistic events or even drift towards becoming show trials. Former leaders such as Saddam Hussein and Slobodan Milosevic often either refused to acknowledge their jurisdiction or used them to berate their new captors.

The ousted leader might well have used the opportunity to open old political wounds and inflict as much new political damage as he could.

'Colonel Gaddafi's death is a mixed event for the new Libyan authorities,' said Mr Daniel Korski, senior fellow at the European Council on Foreign Relations and a long-term supporter of Nato intervention. 'They avoid a drawn-out judicial drama a la Slobodan Milosevic, which could have rallied people in the ex-dictator's support, but his death also robs the new Libyan government of the opportunity of showing themselves better than he was.... His death, in such violent circumstances, also risks creating a martyr figure out of a man whose deeds in life would never have merited such acclaim.'

International media would have jumped on any juicy details of how Western states had wooed Col Gaddafi, helped bank his billions and rebuild his oil industry. Many large companies had struck deals with Tripoli, including Italy's ENI, France's Total, Britain's BP and others.

That risk has not entirely gone away. Some of Col Gaddafi's sons may still be at large, and could potentially stand trial themselves.

If Libya's NTC had wanted to try Col Gaddafi locally, it would have had to swiftly build an entire legal system within which to do so. Col Gaddafi's Libya had little in the way of credible legal infrastructure, and there might have been serious questions over the legitimacy of any process.

With Osama bin Laden killed in a US special forces raid earlier this year, and Al-Qaeda and Taleban leaders also increasingly targeted through drone strikes, some worry that assassination, or 'accidental' killing of foes - rather than messy trials or imprisonment in places like Guantanamo Bay - has become an all too attractive option.

'To say that it is better for everyone that he be killed rather than captured is to say that the legal approach has disadvantages, and that is to surrender to cynicism,' said Ms Rosemary Hollis, head of the Middle East studies programme at London's City University.

'It's hard to see that as a good thing. In Gaddafi's case, on previous form, had he been put on trial he would simply have rambled endlessly, and would have ended up undermining his own credibility.'

She said there was a risk his death might further incense some of his more die-hard supporters and other radicals, particularly if it emerged that he was killed by the Nato strike or executed after capture.

Other analysts warn that Col Gaddafi's death may be far from the end of Libya's troubles.

'If you look at Iraq, Saddam Hussein's capture did not stop the insurgency,' says Mr Anthony Skinner, Middle East director of risk consultancy Maplecroft.

'They are both very different countries, but Libya also has ethnic divisions, and whatever happens, there are a lot of issues to solve.'


Wednesday, October 19, 2011

Teaching the value of values

CAN 18-year-olds be taught ethics or good values? Or is it a little too late, with character well formed for the better or worse, for ethics lessons to make any difference? Will learning ethics have any impact on actual workplace conduct?
By S. Chandra Mohan , For The Straits Times

These are some questions we teachers at the Singapore Management University (SMU), where ethics and social responsibility is a core module, often ask ourselves and our students.

So the recent announcement, by the Minister of Education (MOE), that character building and the learning of values will receive greater emphasis at an earlier age in our schools was good news indeed.

MOE's project raises two questions. First, what are the values that are important for character building?

The ministry will no doubt receive numerous suggestions as to what these values ought to be. According to a Straits Times reader, integrity, respect, care, filial piety and patriotism are core values.

However, students in our schools may not necessarily be strangers to all of these values. An informal study of perceived values, among 400 SMU students in ethics classes, had surprisingly consistent results. Students were asked to identify two values that they had learnt as a child and two values they would teach a child. Honesty, integrity, trust and respect topped the lists. In addition, a number of other values that the students readily identified included compassion, humility, fairness, commitment, responsibility, diligence, courtesy, justice and equality.

Incidentally, these values are not much different from values parents ought to teach children, according to best-selling authors Linda and Richard Eyre. The SMU survey indicates that our students may be well aware of the values that educators may now want to preach to them.

If the students know it all, what then is the cause of the decline of ethical standards and the perceived erosion of good character in our society?

The answer lies partly in the litany of dishonest conduct we have seen in recent years. There are, for our children, just too many examples of the absence of morals and virtue from business, political and religious leaders the world over.

The fact that adults have largely ceased to teach by example compounds the difficulty in teaching values and good character. The virtues that we hold up to our kids do not seem to endure as sturdy values because we have over-emphasised the importance of doing well over doing good. We continuously define success in monetary terms, in a stark departure from what our forefathers taught us. Quite simply, we adults often undermine by our conduct everything that we teach children about values and character.

The second and the more important question in the teaching of values in schools, therefore, is the one that poses the greatest challenge to MOE. How do we persuade students to accept the true value of values? And how are these values to be embedded in students in a meaningful manner?

Obviously, beyond a mere class of instructed values, there must be a continuing emphasis on doing right. The relevance of values must be seen at every turn. There are surely lessons to be learnt about compassion, tolerance, respect for all living things and for simply doing the right thing in every subject from history to biology.

The sports fields too abound with opportunities for the development of character. Rafael Nadal's refusal to make excuses or to blame anyone for losing to Noval Djokovic in the US Open recently, was described by the New York Times as 'the thing of beauty - and the very ethic behind his game'.

In addition, the best lessons may not be pious platitudes but examples of adult failings to uphold values. These examples of failure provide good classroom material of what ethical standards are needed to avoid the greater pain of public discovery, humiliation and even punishment.

At SMU, students in their very first term at law school, beyond discussions on criminal cases, are shown media photos of professionals imprisoned by the courts the week before. In final year ethics, they discover and debate the consequences of failure by corporations, governments and individuals to uphold the right values.

There is, for example, much to reflect on personal values from the experience of American businessman Bowen McCoy, who once decided that it was more important to reach the summit of Mount Everest than to save an Indian sadhu he had found dying on the Himalayan slope.

The lessons to be taught, whether at schools or the universities, must go beyond emphasising good values, which students know only too well. They must also learn how easy it is to let your guard down and be trodden by temptation and what happens to you, your family and your friends (if any are left) if you do wrong. The more enduring lesson perhaps is when children are taught to be good kids in order not to become bad adults.

The writer, a former senior legal officer, is a law professor at the Singapore Management University.

Study HK fare structure and adapt

THE way Hong Kong structures its train and bus fares can be a model that Singapore can adapt to good use, said Mr Ang Wei Neng (Jurong GRC), who is also SBS Transit vice-president.

His suggestion was among several made yesterday by at least three MPs on how the public transport system could be improved.

In Hong Kong, transport operators are allowed to raise prices only when their average return on net fixed assets falls below a specified level. And when they make a profit above a specified level, half of it has to be shared with commuters in forms such as fare rebates.

But they can keep the other half. This is to spur them to improve productivity and look for other sources of revenue, like advertising.

'Look at this model and adapt to our local context,' Mr Ang urged the Government, adding that fare revisions are sensitive matters, 'even if it means a two-cent adjustment'.

Since earlier this month, adults using ez-link cards have to pay two cents more every time they take a bus or MRT train. Senior citizens pay one cent more for each journey.

Mr Christopher de Souza (Holland- Bukit Timah GRC) wants bigger off-peak discounts to be introduced on buses and trains and to cover more areas. This will help address the regular complaints of overcrowding and the long wait for trains during the morning and evening peak hours, he said.

At the moment, SMRT has a 30-cent off-peak morning discount for those travelling on its North-South, East-West and Bukit Panjang lines. Commuters have to exit at nine selected city stations.

Mr de Souza also called for more wheelchair-friendly buses and for them to be on the road more often. Concessionary fares should be given to disabled commuters, 'in line with Singapore's aspirations to become a more inclusive society'.

Non-Constituency MP Gerald Giam from the Workers' Party asked for trains to arrive every two minutes from 7am to 9am, and from 5pm to 8pm, instead of a narrow window of around half an hour on weekday mornings and evenings.

He takes the train to work and said he often has to wait for two or three trains to pass before he is able to board one.

Big boys call the shots in EU financial crisis

SMALL countries are supposed to know when to shut up and simply do as they are told.
By Jonathan Eyal, Europe Correspondent

At least that is the opinion of Mr Jose Manuel Barroso, the European Union's top-ranking official, who was infuriated last week when Slovakia, one of the EU's newest member states, had the temerity to reject a bailout plan for Europe's financial crisis. 'Sovereignty is fine,' Mr Barroso lashed out, 'but you cannot allow a small stakeholder in the community to slow down all the others.'

Slovakia ultimately relented: Under intense pressure from its neighbours, its Parliament duly voted again, approving the bailout proposals.

However, ordinary Slovaks have every right to feel aggrieved. The way big European countries treat their smaller allies is little short of appalling. An EU which was created in order to ensure the independence and equality of its members is now trampling on these very principles.

Slovakia, with a population of 5.5 million, may account for only 2 per cent of the EU's total population, but far from being the object of ridicule, it should be hailed as Europe's poster child.

The Slovaks languished under the colonial rule of Austria and Hungary for centuries and, more recently, were part of a union with the Czechs in what used to be called Czechoslovakia. That union failed and, in 1992, the Czechs and Slovaks parted ways.

In a near-mirror image of Singapore's historical experience, the Slovaks were initially told they were too small and resource-poor to thrive on their own. And, just like Singapore, they proved their doubters wrong. Slovakia attracted massive investment from overseas; it is now one of Europe's top car producers. Although still relatively poor, Slovakia's economic growth rate is among the highest in the industrialised world. It has shown that ingenuity and good governance count for more than sheer size.

When Slovakia became the first Eastern European country to join the euro currency zone in 2009, it took its obligations seriously. Its government reduced its debts and stabilised inflation, a Herculean feat which won universal praise.

Yet, to their horror, the Slovaks soon discovered that other euro member states exercised no such responsibility; in fact, they continued to borrow and spend freely. And, when Greece, Ireland and Portugal faced bankruptcy, the Slovaks were suddenly told they must pay into a fund to bail out these countries.

The sums involved are considerable: Slovakia's contribution is €7.7 billion (S$13.5 billion), a mere 1 per cent of the total bailout fund, but a lot of money for a small country. More importantly, Slovaks are incensed by the idea that they should bail out countries which are far richer, and which have only themselves to blame for their current predicament.

European officials brush aside such objections. To them, joining the euro zone club entails both benefit and responsibility.

There is no doubt that Slovakia derives enormous benefits from euro membership: It operates a currency with a global reach, it is able to borrow far more cheaply and has gained the credibility of a mature economy, thereby attracting further investment. Still, the argument that, as a result, it must now pay for its bankrupt euro partners remains false.

Existing European treaties forbid the bailout of any country and ban the European Central Bank from lending to individual states. So, Slovakia is perfectly within its rights to say no, because the current effort to save the euro is being undertaken despite, and not because of, existing legal obligations.

Still, the Slovaks have accepted that if they wish to save the European currency system, they have no choice but to cough up the cash. Yet what worries them is that the sums recently pledged are already considered insufficient; much larger figures, going into the trillions of euros, are now being bandied about.

All the initiatives on saving the euro are being launched by two big countries: Germany and France. They decide how much money should be offered, to whom and on what conditions.

What is more, an informal division exists between Western and Eastern Europe. The objections of Western European countries are always taken seriously. For instance, not one European politician dared to accuse Britain of irresponsibility when it blocked the idea of introducing a tax on financial transactions.

Similarly, no wave of criticism fell on France, the Netherlands or Ireland when they rejected a project for an EU constitution back in 2005. And no one condemned the Germans when they recently subjected Europe's financial arrangements to a decision of their own national constitutional court.

But when Slovakia dared to raise objections, it was treated much like an irritant. Literally minutes after its Parliament voted against paying its money last week, German Chancellor Angela Merkel defiantly announced that the financial bailout project 'will go ahead'.

Mrs Iveta Radicova, the Slovak Prime Minister, paid for the passage of the bailout vote with her job: She pushed through the deal, but her government collapsed, and fresh elections are due next year. Yet, the rest of Europe is mistaken if it believes this is the end of the story.

Currently, Germany and France's plan to remove the right of individual countries to make any decisions in future economic affairs, and transfer this to a European committee - which, inevitably, will be dominated by the bigger members - is creating an uproar throughout the continent. In their rush to save the euro, Germany and France may end up tearing the EU apart.

The sorry treatment of Slovakia carries a warning for other regional organisations inspired by the EU. Bodies such as Asean are frequently criticised for taking decisions by consensus because it supposedly slows down progress.

However, as the EU's current experience indicates, any arrangement which ignores the interests of individual states because they are small is not only dangerous, but also deeply unjust.

Just ask Slovakia, which did everything right and has the law on its side, but still finds it difficult to be heard.

Tuesday, October 18, 2011

Toddler run over twice, but people just walked by

GUANGZHOU: A two-year-old girl in the southern Chinese city of Foshan has been declared brain dead after being run over twice and left lying in her own blood, ignored by more than a dozen passers-by.

Doctors said the child, now in a deep coma, could die any time or remain on life support for the rest of her life.

Footage taken by surveillance cameras showed 18 passers-by and drivers ignoring the badly injured toddler until a woman scavenger raised the alarm in the incident last Thursday.

The girl, named Wang Yue and also known as Yue Yue, was seen tottering in an alley when a white minivan hit her. One of the front wheels rolled over her body, footage aired by Southern Television Guangdong (TVS) showed.

The driver did not stop the vehicle, but stepped on the accelerator, and Yue Yue was rolled over once again by the back wheels.

After the first hit-and-run accident, which happened at around 5pm, three people walked past the then motionless Yue Yue lying in the middle of the road. Two of them seemed to have noticed her plight, but chose to look the other way.

Shortly afterwards, a truck drove over her, reported Chinese media.

After the second accident, more people either walked by or swerved their vehicles past Yue Yue. Among them was a mother taking her four-year-old girl home from kindergarten.

None of them stopped to help, reported Chinese media.

Nearly seven minutes after the minivan ran over Yue Yue, the rubbish collector spotted her and moved her to the side of the road. She then went to find the parents.

A young woman - later identified as Yue Yue's mother - appeared and carried the child away.

Closed-circuit television footage of the accident obtained by Guangdong media has circulated rapidly online, sparking outrage on China's hugely popular social media sites.

Media commentators and netizens decried the cold-blooded response of the passers-by and the lack of empathy in modern society, reported Xinhua news agency.

One netizen on Sina Weibo, a Chinese micro-blog similar to Twitter, wrote: 'This society is seriously ill. Even cats and dogs should not be treated so heartlessly.'

Another wrote: 'When we denounce these bystanders, we must remind ourselves that they are among us.'

Yue Yue's father, who did not give his full name, said the child had wandered away from the family's metal wares shop when the mother was bringing in the laundry. His wife ran out to look for her, but took a different direction. Yue Yue was found about 50m from their shop.

The mother said the child might have a better chance of survival if someone had come to her aid before she was run over by the truck. 'I am praying for a miracle to happen so that my girl can wake up,' she was quoted as saying by Chinese media.

The couple, both migrant workers from Shandong province, also have a seven-year-old son.

Police said the drivers of both vehicles have been arrested.

Rethinking the 200-year-old flush toilet

WHEN he was a boy, Dr Seetharam Kallidaikurichi Easwaran would sometimes follow his grandfather to the river in the latter's village in Tamil Nadu every morning to take a dip. He would then help the elderly man haul back a few pails of river water by bicycle which they would later pour into mud pots and lace with herbs, from which their whole family would drink. Along the way, the boy would see villagers defecating openly in fields.
By Cheong Suk-Wai, Senior Writer
Dr Seetharam, now 49, says: 'So I can understand what those without toilets are missing and we have not yet invented a big-picture solution to help them.'

Today, this engineer is helping to do just that as visiting don and director of the National University of Singapore's Institute of Water Policy (NUS' IWP) and director of its Global Asia Institute. Last Monday, he launched the Temasek Foundation Water Leadership Programme, which will run for 10 years and train 70 government and water policy leaders a year to manage their water systems better.

The married father of two and alumnus of the University of Tokyo is here on secondment from the Asian Development Bank, where he was its principal water supply and sanitation specialist. I sat down with him last Wednesday to learn how he thinks the world could overcome its water woes and why a billion people still do not have proper toilets at home:

What is the biggest problem that you are trying to solve?

That we are using a 200-year-old technology for sanitation that uses very clean water to flush our toilet waste away without realising that it can be the beginning of a problem because we end up having to treat all that waste water we create. So we now need to invent a new paradigm in which we will use less water, or no water at all, and separate the waste from water in a clean and safe way that also uses less energy because, currently, we use energy to create clean water and then also use it to pump out our waste and filter waste water.

How far have we managed to stop such Sisyphean endeavours?

Recently, my colleague Ng How Yong won a US$100,000 (S$127,000) research award from the Bill and Melinda Gates Foundation for trying to reinvent the toilet. How Yong, the director for the Centre of Water Research at NUS' Division of Environmental Science and Engineering, is pushing the aeroplane toilet further to find a way to extract the calorific value from waste.

How cost-effective would that be, though?

The costs have come down... but people have to be taught that waste will have to become drier because when they dilute waste with water, that creates complications because that would make it difficult to remove energy from the waste. But inventing a toilet that draws energy away from waste is for rural areas because in cities, you need proper sewage.

But don't overcrowded cities need such innovation the most?

The big fear everybody has is that if the collecting of waste water is not controlled properly, it can lead to disease. But out in the country, you have space. Maybe the toilet of the future will have no drain and waste from it will be collected like how one wheels away garbage bins today.

Why don't thinkers ask the man in the street what he needs instead of coming up with elegant solutions on their own?

Inventors are trying to do so in many countries, including China and France. There was a competition in France recently where someone designed a toilet that was like a paper bag that you could open and use as a toilet. The challenge in doing all that is that it has to become a system that can be networked and functional, which means that the entire value chain has to be worked out. If we know how to reduce this pollution load in waste water, fresh water will be easier to manage.

That would help a lot, given how pricey it is to treat waste water.

Yes, treating waste water costs about three times more than it would to buy fresh water. Now, the cost of treating waste water has come down from US$1 per cubic metre to between 50 US cents and 70 US cents but people are still not willing to pay so much for it because they think, 'I will pay only up to 10 cents for fresh water because it comes from the sky'. They do not understand that after they use fresh water, they create polluted water, which nobody wants to pay to clean except perhaps in Singapore, which prices water and sanitation together as a package... We have not come up with a way to capture the value of waste yet and, anyhow, it's poo, which, in many places, is still taboo to talk about.

So what's the way forward?

I have learnt that many communities actually don't have enough water for their needs because they do not have the ability to filter waste water.

But isn't clean water just a case of filtering dirty water?

Exactly. The issue is how do we distribute all that filtered water? Putting water in a package other than a pipe will mean that the packaging is more expensive than the water because water is only about 10 cents per cubic metre and so it's correct to send water by pipe... but if you don't fix sanitation first, having clean water would solve only part of the problem.

What are the main stumbling blocks to doing so?

I don't have all the answers but I've settled on two: The first is that people need to rise to a certain income level before they can really appreciate proper sanitation. When you're making, say, at least US$1,000 a month, you will value personal hygiene and demand a proper toilet. This brings us to the second point: Are people willing to pay to use a toilet? Someone in India tried to champion this idea, even making celebrities of people who operated such pay toilets and trying to hold community meetings in front of such toilets to emphasise how clean they are. I admire such efforts to bring about social awareness but for every success, there have been many failures.

So where might the future successes be in this field?

It will be in the new urban populations which make up about half of Asia today. Do you know that there are upper-income apartments in Bangalore and Chennai that don't have piped water? The people living in these apartments will not want to keep buying bottled water. They also want better sanitation. For all their needs, the current 200-year-old flush toilet will not do because it requires a lot of water to operate. So a new value chain is going to be created from the river and back to the river; usually, we start at the higher end of the population.

But shouldn't research focus on helping the poor first?

I admit that there is a disconnect here. We worry about the bottom of the pyramid which will give you learning but not profits. But the revenue comes from the top of the pyramid, so I'm for sanitation becoming a fashionable industry.

Won't that make the poor even more disenfranchised?

I don't think so; in fact, they might even benefit from it. Everybody used to fear that the poor would have to pay a lot for water. But, actually, they are already doing so. They cannot afford the water connection fee and monthly tariff for piped water. So they pay for only what they use - at rates which are up to 10 times more than what rich people pay for piped water (because there are many risks, like vandalism, to piping water to the poor in rural areas)... Still, the World Health Organisation has estimated that if someone pays US$1 for sanitation, he gets back between US$5 and US$28 of empowerment in terms of not falling ill and so being healthy enough to work.

The real problem with water and sanitation today is the lack of committed leadership. A study of water management in eight countries from 1998 to 2008 done by the IWP has proven that leadership makes a difference in solving such problems, from ground level to someone like former Singapore prime minister Lee Kuan Yew... just champions at even the lower levels would help a lot.

The answer to sanitation problems? It's not rocket science

GARRULOUS and very focused, Dr Seetharam Kallidaikurichi Easwaran believes strongly that sanitation globally will improve only when the poor learn to value toilets in their homes as much as they do their mobile phones. Here he is on:


'It's an advantage for water leaders to be trained here because Singapore is where the real story of water leadership in action is unfolding, from prime ministers to PUB officials to Newater to the Marina Barrage.'

Singapore's unique selling proposition

'Its cutting-edge knowledge in treating waste water; Newater is Singapore's greatest prize.'

How anyone can help better the lives of others

'You have to be like the lotus, which grows in mud and filth.'

How easy the solution to sanitation problems can be

'It's not rocket science; an aeroplane toilet is foolproof because if it were not, you and I would have a real mid-air problem, right?'

Why people think sanitation is like rocket science

'That's because telling them 'a billion people are without toilets' is too big a number for them to relate to when they all have their own toilets.'

The real reason why many women are still poorly educated

'It's not so much the school curriculum as it is the availability of toilets for girls in schools; if there aren't any, parents won't send their daughters to study.'