Budget Humour

Should budgets be philosophical or filmy?

There are so many wisecracks about budgets. World over, budgets have managed to create madness, hysteria, protests, and satire. It is basic to the human mind that no other mind is possibly capable of carefully handling and allocating that joyous commodity, money. Add this sense of insecurity to the Orwellian point of view that all politicians are equal (in their incapability) but some politicians are more equal than the others, and you quintessentially have, what our Parliamentarians fondly call ‘The Budget Session’.

Budgets are largely an exercise in philosophy; you deliver the numbers only to realise that they are never deliverable and never have been, to begin with. “Deficits satyam, Budget mithya” could well be the Indian take on the issue. Americans, those descendants of immigrants and revolutionaries, have scant regard for things as deep as the Shankara philosophy. Their philosophy about budgets goes about as deep as, errr, a bean bag. It was the inimitable Will Rogers, who in his loud style commented, “The budget is a mythical bean bag. Congress votes mythical beans into it, and then tries to reach in and pull real beans out.”

American budgets have inspired perhaps the biggest quips and laughs. George W Bush, never quite revered across the globe for his intelligence, much to the delight of his critics, is believed to have said, “Of course it’s a budget. It’s got a lot of numbers in it.” Can’t get more dubiously Dubya than that, eh?

Greeks, the other race that pride themselves on their philosophical underpinnings, have a different way of looking at budgets and debt burdens. When in trouble, they have a strange Greek way of using wonderful quotes by their forefathers in a most inappropriate fashion. “Speaking the truth and repaying your debts is not a correct definition of justice,” once said Plato. And now says Tsipras, to the great horror of Merkel and Co. It was humour in its blackest form that the Greeks recently passed an ‘austerity’ budget.

Even the late Sophocles, that great master of tragedy who is believed to create despair even in Heaven, started laughing uncontrollably when he heard about that one. Merkel showed her technical German wit when she primly commented, “Austerity makes it sound evil. I prefer to call it balancing the budget.” Even the British raised their eyebrows in appreciation.

Because, perhaps the greatest kind of budget humour can only come from the stiff upper lip of Europe, Great Britain. Unwittingly and unknowingly, George Osborne, the finance minister of UK, created complete confusion in Britain when he dared to claim last year in the British parliament, “This will be a budget for working people.” The Brits paused for a minute over their seventy-third cup of tea to exclaim, “I say, what does he mean, working people? We thought they were called Germans!”

Back home at North Block, the entire team is getting serious about how to get funny. The FM has been braving suggestions on taglines that could scroll on the bottom of the TV screen whilst he would read the budget provisos. Senior advisors have suggested sher-o-shayari, but Ghalib makes you feel depressed, and Iqbal, Congressed. The younger interns are all for filmi taglines.

Imagine, the FM would declare the fiscal deficit target for FY17 to be 4.2 per cent, markets would tank, only to be assured by the tagline scroll, “Bade bade deshon mein aisi choti choti baatein hoti rehti hain.” Or whilst talking of subsidies, “Hum AAP ke hain kaun.” The FM is hoping for an ‘Airlift’


My interview at Sakaal Times On Budget Expectations

Even as Union Budget is presented on February 29, Manasi Phadke, a consultant economist, tells Namrata Devikar about the current state of the Indian economy.

What should the government do to tackle problems like inflation and price rise?
Well, technically, inflation has been soft in the last one year as compared to before, a gain that has primarily come in from the oil price reductions. However, food prices continue to be high, which is a cause of concern for the policy makers because it is these prices that are the most closely linked to welfare of the disadvantaged sections. Government needs to do more in food management. Food subsidies can be delivered much more effectively through the DBT mode and more coverage under DBT will be crucial as we go ahead.

How would you view the Indian economy at present?
Indian economy could well be described to be in ‘snooze-mode’. While it has clearly snapped out of the political logjam and economic stagflation, it is somehow yet to rise to the occasion. The growth has shown a revival at 7.6 per cent for 2015-16. However, this creates a GDP level that is nonetheless much lower than the potential output we can produce. The economic survey of 2015-16 has hinted at a long-term potential growth rate of 8-10 per cent and so there are clearly issues. As I see it, there are certain issues that are created externally and certain others, which are rather structurally and culturally Indian. The former includes a slowly growing global GDP, which affects export outlook, climate changes and monsoon vagaries, volatility in perceptions connected to emerging markets, etc. These do create problems, but it is the latter structural and cultural factors that are really tricky.

Structural factors pertain to the woeful levels of infrastructure and farm investments that have been witnessed in India. It takes time to cure such neglect. Again, the slowdown in revenues that was witnessed in India from 2011 onwards has contributed to a corporate sector that is by now debt-burdened. Even if revenue growth happens now, companies divert their earnings towards debt servicing, as a result of which investments suffer. The toughest to change however, would be the cultural factors. Everyone talks about the steep pendency rates in judiciary. However, our bureaucratic pendency is equally steep and creates a slower movement down the line from policy to implementation. While the Government has been changing things through a policy platform, structural and cultural roadblocks take time to clear and that is perhaps the greatest challenge right now. Given the political mandate that the government enjoys, it does seem to be a now or never time for these issues to be resolved and I am hopeful that they will stand resolved soon.

What should be the thrust and focus of the budget and why?
Clearly, agriculture has to be the focus point for the budget. It not only is a huge source of employment, but also can swing the price stability balance fairly sharply. Monsoon vagaries this year too have contributed to low production and high food prices. Add to that a burgeoning middle class with higher demand for protein foods, and you have a recipe for food inflation. The budget will have to allocate funds towards micro-irrigation systems, cold storages, crop insurance and financial inclusion. More allocations towards smart cities, education programmes, women and child programmes, re-capitalisation of banks will all be equally important. These allocations can only be supported provided the tax collection increases. Tax reforms should also be a thrust area, else we risk moving away from the fiscal consolidation path, with consequences for interest rates, exchange rates and inflation. Econometric results suggest that fiscal deficits can promote growth in the short run, which is tempting, but tend to be inimical for growth in the longer term perspective. Hence, another thrust area for the budget is to make sure that fiscal discipline is maintained.


The reader may view the interview directly at http://www.sakaaltimes.com/


Econ Mom watches Rail Budget with Lil One

Lil One has been quite unwell. He had a bad tonsillitis episode combined with a nasty viral fever and was grounded at home last week. From Wednesday onwards, he was actually quite on the recovery path; a quick barometer to gauge recovery is the “back-answering” index. He was shooting nasty answers at me quite happily and when on Wednesday, dinner saw him crack some of the most abominable toilet jokes, I knew that he was absolutely fine.

“Why don’t you go to school tomorrow? I am busy and you seem to be quite fit. And your jokes will find a much more errr…receptive audience,” I remarked nastily after having suffered about 21 of those, most of them cracked just when I was about to gulp my food.

“What? School? Nnnnaaah, this is so much fun!” Lil One said innocently and quite happily and then catching my nasty gaze, recoiled with a correction. “I mean…I mean…I mean I am quite unwell, Mom. Even Doc says the same thing. Are you going to send your sick child to school?”This one came with wide eyes and the sweetest possible tone.

“You are quite right about the “sick” bit, there. Ok. If you don’t want to go to school, that’s fine. But let’s study something. You have missed a lot of lessons.”

And so we sat down to read the lesson on the Parliament. The main function of the Parliament, said the lesson, was to debate and discuss and legislate. Pass laws for the betterment of the country. The Parliament is made up of the Lok Sabha and the Rajya Sabha and the President. Once the bills are passed by both houses, the President signs the bill into an act.

“Heehee, if I were the President, I wouldn’t sign so easily,” said Lil One, his eyes glinting mischief and wickedness. “What happens then, Mom?”

“Hmmm. I’ll tell you what, Lil One, it is to take care of wicked minds like yours that our Constitution is drafted so beautifully. The moment such wicked thoughts come to your mind, immediately an article comes in to offer correction. So, the Constitution provides that the President can refuse to sign a bill that has been passed by both houses only once. The second time around, he has to sign. Now do you see what a great job Dr. Babasaheb Ambedkar has done?”

I could see awe in Lil One’s eyes. He tends to respect people who can pre-empt mischief.

“The lesson says you can’t introduce money bills in Rajya Sabha. Why is that so, Mom?”

“Well, the LS members are elected by direct voting, but RS members are not. So matters pertaining to money have to be proposed by people’s direct representatives. Got that, pesky?”

“Oh! Is that what you keep talking about? The Budget? Does that mean the Budget only can be introduced in the Lok Sabha?”

“Bingo!” I beamed at him with pride. I like it when he talks economics. “The Budget is a proposal that the Finance Minister has for the country. So, he will present the Budget in the Parliament. The other MPs will listen and debate and discuss. He will then submit the Finance Bill for discussion and approval to the Parliament. All this is done under the supervision of the speaker. The FM is Mr. Arun Jaitley (Lil One nodded knowledgeably) and the Speaker is Mrs. Sumitra Mahajan.”

“Oh! I didn’t know that the Speaker was a woman!”

“Whether in Parliament or at home, only women are speakers, son.” That was Hubby. I gave him a poisonous look while Lil One giggled.

“Is that why you are busy tomorrow, Mom? Is the Budget going to be declared tomorrow?”

“No, sweetie. Tomorrow is the Rail Budget. It will be presented by the Rail Minister Mr. Suresh Prabhu.”

“What happens in the Rail Budget?”

“Well, Railways are a BIG project for the Government. So he’ll tell us tomorrow how many new trains will be introduced. Whether new tracks will be created to join remote areas. Whether trains will be made more hygienic. Whether superfast trains can be introduced for certain tracks. Whether he is planning to increase the fares for passengers and/or freight. Do you know that more business for Railways comes from freight than from passengers like us?”

“Wow! No, I didn’t know that. So will he raise tickets for the freight trains?”

“I guess not,” I said smiling at the peculiar “freight ticket” usage. “Business from the freight component has already been falling. His steepest competition for freight is trucks. And since diesel prices have been steady, I do not somehow see him risking increasing the freight rates.”

“Why is this Rail budget such a big thing?”

“Well, if he plans lots of new trains and tracks, then the Government will go shopping for steel. And the steel makers will employ more people. And they’ll shop for coal. And the coal businesses will increase employment. When the people working in the coal and steel industries get paid, they go shopping for clothes and books and food. So more people get employed in those industries and so on. So, if the Rail Budget promises lots of new investments and new tracks etc., then it is good news for employment and welfare of the people.” Whew! Explaining the Keynesian multiplier to kids is a tough job. Lil One didn’t look super convinced, but didn’t say much.

Next day was the Rail Budget. Since Lil One was at home, I told him to watch the Rail Budget with me. “But I won’t understand it!” He started to whine. “See the Lok Sabha in action once. You will get a better grip on that lesson!”

And so Econ Mom sat down with Lil One to watch the Budget. He was watching everything quite carefully, and in between listening to the announcements, I was pointing out where the Speaker sits. And showing him how the MPs sit on their benches in a semi-circular arrangement to debate and discuss.

As some shouting erupted over some announcement, I primly told him, “The chief function of the Parliament is to debate and discuss and pass laws.”

I was rather proud of myself for having converged my rail budget gyan with his civics lesson and was congratulating myself on having done a simply phenomenal job when Lil One piped up.

“But Mom, they are only shouting!”

I was flustered. “Ahm, well, that does happen at times, when they feel very errrr…passionately about an issue.”

“And look at that man. He is sleeping. Hee hee hee! And those two women back there don’t even know what is happening. That’s exactly how Swapnil looks in the class when Teacher is teaching us linear equations. Heeheee!”

Gawd! What a reality check! I guess I should have never got so enthusiastic about getting civics lessons to come alive. “Now if anyone asks me what I want to be, I know what I’ll say! I want to be an MP! It’s really easy and it’s so much fun!” Sigh!




Thought for food: Coco(a) Bonds and Dosa Economics!

Dear Reader,

This article appeared in the Hindu Business Line in my column “Tweakonomics”. You may want to read it directly at http://www.thehindubusinessline.com/opinion/columns/thought-for-food/article8272473.ece.

Else, read it here…Enjoy!


Economics just became a whole lot more edible this week. It all started rather unexpectedly, with a student asking the RBI governor why dosas have become more expensive despite the disinflation phenomenon in India. Pat came the answer.

It’s not the dosa, stupid. It’s the tawa! It’s the tawa that has retained its price and reluctance to change the tawa technology has cost us, dear. Pun intended. And it doesn’t quite end there, does it? The hand that rocks the cradle, rules the earth. And the hand that rules the ladle, rules the worth.

Simple! Labour prices have skyrocketed, so much so that they nullify the reductions we get from ingredients. Ahem, not that we are getting too many reductions from those ingredients there. Important to note that the dosa is primarily made from urad dal, after all.

The statement from the Guv created quite a furore. The RBI has issued a new guideline saying that all future governors should necessarily be good cooks and have to know all ingredients going into major food dishes. The Bhumata Ranragini Brigade is now actively considering marching into the inner sanctum of the RBI saying they always knew that women would make better governors.

The RBI has launched a new Big Dosa Index to counter the very popular Big Mac Index as the Indian contribution to quick-fix inflation gauges. The CSO, ruffled at being sidelined, cleverly pointed out that since dosas are only sold on retail, the BDI can only be seen to be a quick gauge of CPI movements and is hence, an incomplete index. The RBI reacted sharply by also announcing the creation of a Tawa-Index to understand wholesale price movements.

Startup India has announced a new VC funding line to whoever gets new technology for creating dosas. It’s expected that support to this line of credit will be declared in the upcoming Budget through the Tawa Hatao, Dosa Bachao Yojana.

Commercial banks now know what it takes to reduce their NPAs. Risk rating on the over-the-counter food service business units has gone down drastically since they are seen to be the only guys who can continue to charge high and make high profits, no matter what the inflation numbers. The new base rate or PLR will be termed the DLR, the Dosa Lending Rate.

On a more international front, Deutche Bank made headlines with its coco(a) bonds ratings taking a beating from S&P. “Their standard is very poor,” said an RBI spokesperson. “We always knew that this cocoa business is very risky. Had they listened properly to the Hon Governor, they would have issued Dosa bonds. That is the only way ahead.” The Chinese are also thinking of replacing Dim Sum Bonds, which have in letter and spirit become Dim Sum since the devaluation, with Dosa bonds.

In the meanwhile, the FM was fairly terrorised when he was asked to host the halwa ceremony. Despite the fact that no student interaction was allowed at all, he made sure that he knew the halwa recipe by heart before meeting the media. For good measure, he also learnt the prices of rawa, sugar and ghee, all by heart.

Rumour is that after getting to know the phenomenal prices of ghee and dry fruits, he wants to create a halwa cess to fund such colossal expense programmes. It is estimated that this single move will move the fiscal deficit from 3.9 per cent to the magic number 3.6 per cent. The RBI governor is happy. Dosas sure work!

Econ Mom becomes the FM!

“Sssshh! Can you reduce the volume, guys? I am reading something important!” I yelled to Lil One and Hubby, who were watching some crazy TV show with great gusto.

“Mom, come join us…what are you reading anyway which is so important?” Lil One sounded hurt that Mommy wasn’t joining in the fun.

“Oh, she is reading news pertaining to the Budget,” said Hubby, in a maddening, condescending fashion. “As if she’s going to be the next FM.”

The words stuck to my mind. As if I am going to be FM. That would be a disaster of an order unknown. Econ Mom could almost see the entire circus unfolding.

A couple of days ago, the Halwa party was held at North Block. Well, that’s kinda traditional. The halwa party marks the printing of the budget documents. About a 100 officials who are involved in the printing of the budget documents stay at North Block from the halwa party upto the budget day so as to maintain complete secrecy regarding the same.

If Econ Mom were to be the FM, the first unmitigated disaster would be awaiting me at the halwa party in the format of Hubby’s Aunt, the Cook, who believes that she is the Only One who can..Cook.

“Oh no no no, is this the way to make halwa,” she would grumble, causing all the bureaucrats and budget experts, already weak from the crazy work schedule, to cower visibly before her towering persona. “And this is not halwa, to begin with. This is Sheera. Your cooks don’t even know how to make halwa.”

I would be busy trying to pretend I do not know the woman and do some intellectual talk on the fiscal consolidation path.

“Beti, next year, whether you are FM or not, and looking at your track record, I am really not sure you will be, but I am going to teach this joker to cook halwa. Tch, tch, tch…when the boss doesn’t know how to cook, how can I expect this poor man to be cooking properly!” This last bit would be probably addressed to Arvind Subramaniam, the Chief Economic Advisor, who would start to explain that he was NOT the cook. “No, no, no. Don’t give me excuses, young man. You are a very poor cook!”

Eve of the budget. The entire team would be discussing the last minute issues. “And Madam, be forceful when you make that announcement about cancelling the LPG subsidy for the richer households!”

And in the midst of the Chak De! huddle, Hubby would call, just to take stock and generally shake me up with the most stupid details. “Sweetheart, our washing machine stopped working today.”

“Ohk, look, I really can’t talk about this…we are in the midst of the LPG subsidy strategy..”

“Good you reminded me!” This, if I know him, will come in a super booming voice. “Say, sweetheart, we’ve run out of both cylinders. I know you asked me to book a refill, but I don’t have the number….errr, do you?”

“What? Gawd, how can you? Forgot to book a refill? I am really going to levy a special tax on Company Secretaries tomorrow.” That last bit would be hissed in that poisonous tone I generally reserve for him.

“Hey, cool down, honey…just joking…what are you so tense about? It’s just a budget!”That’s SO typically Hubby.

“Just a budget? JUST a budget? I have to announce it in the midst of antagonistic opposition members and later there’s a talk scheduled with Arnab Goswami…I am scared…”

“What are you saying? Scared of Arnab? Arre, don’t you worry, just imagine its me you are talking to and you’ll tear him down to pieces in that rude, impossible, toxic, inimitable fashion of yours, sweetheart. I give him 2 minutes at the most. He is going to meet his match today!”

Sigh! Was that a compliment?

Day of the budget. I reach the Parliament with the suitcase in hand…nnnnah, make that a purse, a real classy one. Hmm, I am dressed up and am walking up the steps when the cell phone rings.

“Moooooommmmy, I forgot to tell you…we had to take Geography maps to school today, else I’ll get a remark!” That was typically Lil One, who ALWAYS remembers what’s to be taken to school whilst at the doorstep or in the school bus. Grrr!

Gawd, this is so stressful! “Listen, I am going to be on TV. You can tell your friends too. And a remark or two is ok!”

“What? They finally gave you that lead role in Kabhi Bahu Kabhi Daayan? Dad was telling me! How embarrassing! I am not telling my friends. They’ll laugh at me. So now I’m getting a remark and plus everyone’s going to laugh at me….Aaaaaaaaaaarrghh!”

It’s final. Econ Mom really doesn’t want to be FM.

Thus Spake Yellen: The true reason for the Sensex crash!

Dear Reader,

Hi! Here’s a spoof piece that I wrote on the Sensex crashing because of Janet Yellen catching a cold 🙂 It was carried today under my column “Tweakonomics” in the Hindu Business Line. You can see it at http://www.thehindubusinessline.com/opinion/columns/thus-spake-yellen/article8224068.ece, else read it here directly. Do send in your comments! Enjoy!


“Ma’am, the weather has created an issue. I’m not sure our international audience can hear us properly. Should we postpone this, Ma’am?” That was Fed’s tech support, looking anxious and worried. “Whad! No, no… lend us go aheand with the pnodcast… achooo!!” That was Yellen, determined to set a few things right on the global front.

“But the pnodcast, errr, the podcast, is having serious tech issues Ma’am…” Tech support faltered as the Fed eyes glinted dangerously at him. “Okay, Ma’am. Good luck!”

Back home in India, at a typical Bambaiyya broking firm on Dalal Street, Boss was talking to the novice employee, freshly graduated from Delhi School of Economics and enthusiastic about sharing his gyan with the mere mortals, the traders. “Boss, as per OECD as well as NBER forecasts, the best predicted value of global growth rates should be in the range of 1.3 per cent, with a standard deviation of 0.2 per cent. The contagion could spread to India. I can’t wait to hear Yellen speak!”

“Arre, talk English. This is a broking firm, not a some fancy think tank. Why can’t we receive the signal properly? What is she saying? Ssshhh! Listen”

JY: I stand here tonday, waning to snet things right, ndespite poor nealth and ndespite this nasty cnrough.

Novice: Sir! She is saying its rough! Yaay, I was right!

Boss: Arre Bhagwan! Punch the sell button, idiot. You got to punch it before others. Gawd, why don’t I get youngsters with nimble fingers?

JY: We need to ndo something ndifferent, to nflow on indeas…

Novice: Sir! Didn’t I tell you? She is saying go slow on India!

Boss: Punch sell! Don’t talk, just punch sell… gawd, they’re all selling! What are you waitin for? Sell!

JY: The cnurrent nituation on oil has ncaused a slowndown which is very nconplex, not seen in the pnast nfifty years…

Novice: She is now talking about the Sensex and the Nifty getting into a slowdown. (Now with awe in his voice) I never thought a Fed governor would give so much importance to the Sensex!

Boss: Oye, give me your philosophy later. God, why did I hire an economist? Arre, punch sell. Oh my God, what was that? Was she saying something about who is a role model for the Fed?

JY (suddenly racked by a coughing fit): Achroo, ichko, achkoraaaa!

Novice: She said Haruhiko Kuroda! America is going to go into negative interest rates, Sir! Global scene looks to be really bad!

Boss: Arre, main toh looti gayo! Market bhi gayo! What are you staring at me for, you nutcase? Punch sell!

JY: With Bank of NJapan going into negative nrates, narkets are talking of other bnanks mirroring that move. I am not ngonig to buy that indea…

Novice: What! She is not going to buy on India!

Boss (in total despair): Market is totally down and we’ve lost so much money. What are you punching now, you idiot?

Novice: My resignation, Sir. The Sensex and Nifty are now both at 52-week lows. Hurrah! Time to join NDTV as an analyst!