Econ Mom, voter perceptions and a dash of Tennyson

“Hi, Mom! What’s for dinner?” That was Teenager, back from his badminton practice at about 8:00 p.m.

“Well,” I said enthusiastically, “there’s roti, beans, dal and carrot raita in curd!” That was me, happy and secure in my belief that I’m feeding all the right stuff to my family.

“What? Beans? Uuuuuuuuuugggggggggggghhhh. NOONE eats beans, Ma, except us. And we eat it every third day! Beans, potato, beans, brinjal, beans, capsicum, beans…?”

I looked at him speculatively. Teenager has taken this one thing from me, for sure. He can exaggerate. The boy can have a golden career as an economist, I started thinking. “The GDP growth rate of India is 7%, nnnno, its actually 7.3%, nnnnnnnnaaahhh, it’s more like 7.8%!” Yeah, he can really do a fine career out of this wonderful trait. Put him in the RBI, and your CPI will go crashing down to 4% or wherever it is that Urjit wants it to be. Put him in NITI Aayog, and you will get your growth numbers right. Put him in the Commerce Ministry, and India’s trade to world trade ratio will cross the dreaded 3% psychological benchmark in a matter of minutes! Heehee, the boy has potential, I tell you. He simply HAS to become an economist.

“I am NOT going to eat this! Give me something interesting, Mom, I’m hungry! And I’m bored” That broke my reverie and jerked me back to reality. And the reality is that teenagers have absolutely no clue or interest in any career profiles. They have only two massive sensations. One, hunger and two, boredom. Sigh.

“Beans are great for health! And …”

“Mom, why can’t you make Chhole-bhature or pasta for dinner?”

“Because the former is oily and the latter is maida. Only calories. No nutrients. Beta, dinner has to be healthy! And this week, we’ve not really had beans for about…”

“20 hours,” piped in the Hubs, with a sly smile. “This time she has really broken all records and cooked beans within the usual 24 hour deadline!”

“Oh, shut up, both of you! And boys, you can’t declare a strike at 8:00 p.m. Food is ready, I am beat and I am not going to cook anything else. It’s too late for that.”

“This is so not fair!” Teenager, indignant with rage and upset at the gastronomical disappointment. “If it’s not possible to change the menu at the last minute, then ask me earlier, Mom. Next time, ask me when you go shopping for veggies. ONLY the vegetables I approve should be bought next week. Else you’ll keep on dishing out what you feel is right…”

That’s interesting! Thought Econ Mom, surfacing suddenly in Mrs. Phadke’s kitchen. Hmmm, isn’t that exactly what the State Election Commissioner had been saying, just a couple of days ago, in our meeting at Mumbai?

“We need to take a look beyond our usual role.” The Commissioner, as always, had come well prepared with his ideas on what needs to be done. “The role of the State Election Commission of Maharashtra (SECM) is to conduct local body elections in a free, fair and transparent manner. And we do that, to the best of our capacities and abilities. But the real question is, even if the election is conducted fairly, are people really getting a fair choice to choose from?”

For the uninitiated reader, let me just put in a little bit of gyan. When the candidates file their nomination forms for an election, that is when the voters come to know what is the mix of people from which they select a people’s representative for themselves. With great foresight and I must say, with a lot of gumption, the state of Maharashtra offers a “NOTA” i.e. “None Of The Above” option for its voters, so that the voters do not have to always choose the least of all evils. They are getting a choice to say that they want none of the candidates at all. And this, is supposed to be an absolute triumph for democracy.

However, deeper thought tells you that while NOTA is great for freedom of expression, the fact that hordes of people have this expression is itself worrisome. Thus, what is happening is that candidates filing nomination do not match the expectations of the electorate. The authorities know this, but they can’t do much about it. So, they decide to give the NOTA option to the electorate so that their voice can be heard loud and clear on the day of the election. “We do NOT like these candidates.” The problem is, that it is kinda late to do anything about this, just pretty much like it was too late for me to cook a different recipe for Teenager at 8 p.m.

“The true solution is to give them a voice before the elections.” That was what the Commissioner was saying in the meeting. Is it really necessary to do that? Even while this thought hit my mind, I got the answer. “Our job is to do everything in our scope to strengthen democracy. If the electorate is not happy with the candidature, we can’t just sit around offering NOTA. NOTA might bring the issue to light, but it certainly does not resolve it.” NOTA is the dressing on the wound. The team was brainstorming on why there is the wound in the first place.

And out of that emerged one solution. Accordingly, we’re currently doing a snap poll on voter perceptions, or what the voters want. What kind of a candidate do they really want? Do they want people who are clean, or is the priority on efficiency? How many voters feel that candidates ought to be well-educated in order to be a good representative? What proportion of voters feel that women make better representatives than men? How many people are of the opinion that good candidates stay away due to criminalization of politics?

Data analysis will soon reveal voters’ preferences. This is to be done prior to the filing of nomination forms, so that the political party heads too will get a pulse of what the common man wants. This will hopefully feed into a more scientifically designed ticket distribution process, with at least a few deserving candidates getting the tickets. Rather like buying only those veggies that Teenager approves of. This will truly give voice to the electorate and make the process more participative, which is exactly where we want to go, right?

Right, but, will this work? Even if the data analysis brings out these trends, are political parties going to toe the line? Are they going to go by statistics, or by the simple chemistry of dynasty and money? We all know the answer, don’t we? Then am I doing something futile? Why should we create this data-base on voter perceptions when we know that the true users of this data, the political parties, can, but won’t use it?

I sat in my chair, post dinner, brooding over the futility issue, when Teenager started a discussion with Daddy dearest on poetry. They were both arguing about what a line in some poem meant. I was far away from the discussion, disturbed and restless. Suddenly, Teenager propped his English text in front of my eyes. “Mom? Have you ever read these lines?” he asked.

And Econ Mom found her answer. In a dog-eared literature text-book. The answer to why a scientifically designed statistical survey has to bring out voter issues, political parties be damned. “Tis better to have loved and lost”, said Alfred Lord Tennyson, “than never to have loved at all.” Bravo.

 

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Kahani Contract Ki: Holmstrom’s Sholay connection!

Dear Reader,

Hi! Here’s a tweak piece arguing that the Contract Theory of the Nobel Laureate Bengt Holmstrom is but a spin-off of Sholay 🙂

This piece appeared under my column Tweakonomics in the Hindu Business Line today. You can read it at http://www.thehindubusinessline.com/opinion/columns/tweakonomics-on-nobel-prize-for-economics/article9211922.ece; else read it here directly. Cheers!

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The modern world rests on the foundations built by contracts. Contracts, when completed, when partially honoured, when inefficiently designed, lead to different scenarios that can be used to describe situations in the world of economics and sociology. It is for “launching contract theory as a fertile field of basic research” that the Nobel Prize in Economics for 2016 has been awarded to Oliver Hart and Bengt Holmström.

Year 1975. As fate would have it, Holmström, then a professor at Kellog’s Graduate School of Management, was bored. Life had become but a bowl of cereal. Paul Samuelson had already received his Nobel for unifying static and dynamic analysis. There was Kuznets who had had the last word in growth, and Kenneth Arrow who took the system from growth to welfare. In the process, if there were any fluctuations at all, Myrdal and Hayek had already explained them. Milton Friedman had had the last word on most of stabilisation theory and Ohlin broke the trade barriers. Aaaarrrrgh! Was there anything at all left to be analysed?

Frustrated, Holmström went home and idly flipped channels on TV. Lady Luck was watching. Had Holmström decided to watch the many antics of Lucille Ball, she would not have helped him. The world would then be a different place.

A certain Cambridge economist would go on to become FM and then, against all odds, the PM of a developing country. Quite a strange contract it would be. The intense political economy situation would lead him to pen the theory of political contracts and later to a powerfully silent Nobel acceptance speech. After all, a lot rested on whether he would flip over to the next channel or not. Holmström hesitated, paused, and flipped.

An Indian movie was being aired. There were people dancing to a song. And then suddenly came dacoits. The villagers ran helter-skelter and two good-looking young men shot at the dacoits, who were forced to return to their lair to face the wrath of the Sardar. “Kitne aadmi thhey?” asked the Sardar spitefully. How interesting! This guy, who is the principal dacoit, does not really know what his agents face in the field. The main fella has an objective function of dominating the local area with the help of Kalia et al., whose main objective is to bully and snatch food from villagers. How non-optimal! A breach of contract is imminent. Hmmm. How will the principal control his little gang of agents? “Jo darr gaya, samjho marr gaya.” Ouch!

But see how the coin flips (ahem, quite literally too, in the film). There’s this cop, who too is a principal working with the agents. He is not only armless, but also pretty much blind to field issues. But he is smart. He has the objective function spelt out: “Mujhe Gabbar chahiye. Zinda.” He keeps the money part of the contract simple. Half the amount to be paid at the beginning, half once the job is completed. This thakur tests his agents’ capabilities, gives them information over a spiffing cabaret performance to complete the contract, and in the end also uses the verbal promise made by one friend to emotionally fortify the terms of the contract.

“Brilliant!” thought Holmström feverishly. Every situation is basically an outcome of a contract, wisely or unwisely written. Let me put this down into an academic paper. As the thakur would have said, “Loha garam hain. Maar do hathauda.” The rest is history.

Surgical, Purgical and Mergical Strikes in the Indian Budget

The surgical strikes carried out by the Indian Army have taken the imagination of the country by storm and rightly so.

In the meanwhile, “Surgical strike” has become the absolutely new buzzword in town. Such is the lure of the word that Chetan Bhagat has immediately decided on his new book: Surgical Strike-Point-(at)-Someone. The fellow is simply incurable.

Newshour has declared 8 weeks of Surgical Strike analysis and apparently been calling up Pakistani politicians furiously to book their dates for the period. This single-handedly has caused dizzying levels of relief for Indian politicians, who for the first time in many days, feel completely free to make idiotic statements and mini-scams without fear of being grilled by the One and Only. The PR team of the UPA scion’s Kisan Yatra is said to have collapsed amidst mingled tears of joy and relief. The Kisans though, are on the run.

B-Schools, tired with meaningless terms such as “leveraging marketing strengths to enhance ground zero” are simply overwhelmed by the discovery of such a powerful new word. Harvard Business School has now officially included a new strategy in the corporate mantras: The Strike with a capital S. Bewildered students are now being asked to “leverage marketing Strike potential to enhance ground zero”. Financial Management Journals, which hitherto described “Strike Price” as the price at which a security can be purchased due to an option, now also include the definition of the “Surgical Strike Price”. This is the price at which security can be enhanced when no options are left with us anymore.

Amidst such corporate celebrations, however, the FM has been sulking. Had he known the term before, he could have leveraged it to enhance ground zero, errr, to highlight main points of the fiscal policy. How? Well, getting the GST passed was no less than a surgical strike, was it? To trump the Opposition in LS elections so as to get the majority in the Lower House, and then to diplomatically isolate them by highlighting their attempts to stall the Bill, was just the start. And then, those incessant sessions with the State Committees to understand the sticky issues and accommodate the sensible demands. Hadn’t he too, spent sleepless nights, before the passage of the Bill?

Take the case of removing the Plan – Non Plan design of the Budget.  For the first time, the Budget will be presented, way before its usual February date, without the usual priorities as suggested by a Five Year Plan. The Budget accounts will only be classified into the Revenue and the Capital Accounts, with zero mention of the legendary Plan and Non-Plan Expenditure classification. To remove the influence of the Five Year Plan from the Budget as well as do away with a separate Railway Budget has been no mean feat; a “purgical” strike, anyone?

Hmmm. And that masterstroke of creating the Monetary Policy Committee (MPC), while at the same time allowing the Governor the autonomy of a casting vote. He had simply changed the dynamics of the game; now there would also be growth combatants together with inflation warriors within the RBI. He had successfully merged growth objectives with inflation management, and how! “Oh, I should have called it my “mergical” strike” he thought wistfully.

Of course, the decision of the MPC, in its very first policy review, to slash rates has not gone down well with all economists. Dr. Rajan, the erstwhile Governor shuddered delicately in Chicago, when quizzed about his reaction to the rate cut. “It’s more of a “splurgical” strike,” he said. “A classic case of too many cooks spoiling the Booth.”

 

Yours truly…When Raghu wrote a letter!

Dear Reader,

Hi! Now that Urjit Patel takes over as the Governor, Raghuram Rajan wanted to share those wicked tips on handling the high profile job properly! Read the heart-to-heart, Governor-to-Governor letter in my humor column “Tweakonomics” in the Hindu Business Line at http://www.thehindubusinessline.com/opinion/columns/yours-truly/article9022386.ece#comments. Else, read it here directly. Enjoy!

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Dear Bro,

Hi… ummm, let me firstly do the right stuff and welcome you to this super-high profile job. It’s obviously every economist’s dream job, and yes, highly gratifying, intellectually satisfying, policy-oriented and autonomous as well (err, at least on paper)!

Okay, formalities over, let me now talk plain truth. This job is the most thankless, frustrating, annoying and the most unenviable post an economist can ever hope to man. And while I’m extremely proud of you, I must convey that what I feel for you right now borders between high anxiety to plain paranoia. Friedman help us all! Why did you accept this, man?

Well, so I thought that I’ll be a good friend and share some of those few experiences that you may benefit from, as you step into the ring to try and control inflation, growth, employment, currency, exchange rates, FOREX reserves, bond yields, bank assets, RBI pay-scales, central banking autonomy as well as the Government’s ego, all at the same time, while still managing to look completely unruffled and fit from your squash game last evening.

The media is the undoubtedly most exasperating part of the job and will insist on calling you Santa Claus (post rate-cut), inflation warrior (post rate hike) and rockstar (when you maintain status-quo). Hehehe, I may be the rockstar, but you are the quintessential rapper, eh?

There’s news from the RBI, Yo! It’s sure lookin good/

Sentiment is up, so is the market mood!

China is down, but the US looks bright/

 

We’ve got a new warrior, Yo! A corporate-wala knight!

Rap…….Patel Rap!

All the best, Bro. I never quite knew how to react to these crazy things they wrote about me. So here is my first advice. It is alright even if you do not plan your post-policy review speech, but you MUST plan how you’ll react to the rapper analogy. Will you be white-lipped and disapproving, or give just a plain bored look, or will you laugh outright? My personal strategy was always “review with a smile”. That humour quotient always works. And oh boy, are you going to need that humour!

A word of caution. Avoid idioms and phrases and just talk plain ole repo. You’ll do well to steer clear of the land of the blind, one-eyed, two-eyed or any kind of king completely. Also stay away from regular birds like hawks, doves, owls; run in the opposite direction on spotting the black swan.

What can I advice you about inflation targeting? It was you who spearheaded the entire process and helped set the bandwidths around the 4 per cent inflation mark. But Bro, there is this other targeting I have to caution you about. Tch, tch, tch, you are too international for this profile. Born in Kenya, graduated from LSE, an MPhil from Oxford, and a PhD from Yale? A stint with IMF and BCG? Are we in trouble! Earlier it was only me who was “unIndian”, but now there’s also Brett Lee and you. Wonder if they’ll invite Brett next. Anyway, welcome to the madness. I am sure you will deal with it with your usual good sense, and set those bandwidths of tolerance around your profile.

Don’t let the volatility in markets lead to volatility in your mind. Let statisticians worry about the ARIMA models. Remember, GARIMA is more important that ARIMA. A final word: When you are having a hard time, read ‘Tweakonomics’ in Business Line.

Sincerely,

Banker on the move.

Econ Mom as the confused driver!

Aaaaaaaaaaaaaarghhh! It’s been such a nutty week and poor Econ Mom is a complete, total, confused mess.

It all started a couple of weeks ago, when my car started making strange noises on applying the brakes. Now, a good ole Honda doesn’t ever create any which noise, forget strange noises, and I was spooked. I tried applying the brakes fiercely, gently, with a smile and with a professional pan-face. Nope.

The car wouldn’t be persuaded and was taken off for an overhaul. In the meanwhile, the Hubs sweetly offered me his car. I’d have liked it with the Hub-chauffeur, but no such luck. I got only the machine minus the man. And the main problem is that it is German.

We, of the Honda tribe, detest German engineering. Gott im Himmel! Hubby’s Polo doesn’t start till you apply some serious muscle tension to the key; and the reverse gear is the first gear plus tension. I tell you, I was unused to such tension in my regular driving life and it was freaking me out.

But, you don’t know the worst yet. The Polo indicator controls and the wiper controls are on the wrong side. The Germans may be marvellous at engineering, but the idiots don’t know their left from the right. OMG. This is magnificiently spooky. I was feeling like a right wing economist being forced into writing a poem “In Praise of Marx and Controls.”

The first day on the Polo and some weirdo who came from the opposite side of our super narrow street flashed his headlights at me. Now this, is a pure-ghee Indian driving phenomenon. The person flashing lights first apparently has the moral right of way, other things be damned. “Oh yeah, I’ll show you who goes first,” I thought viciously and flashed the light indicator viciously to be met by a most efficient German water jet on my windscreen, causing me to jump madly in my seat. “Hell,” I thought, automatically moving my left hand towards the wipers, in the process switching on some indicator lights. “Oh, this is really quite merry”, I thought with gritted teeth as cyclists and bikers behind me started to swear, not quite sure where I might eventually turn. By now, in addition to switching on all possible headlights and indicators, I had also started the wiper on the backscreen. My car does not have the feature and I was terrified. Germans, you back stabbers!

I had a real bad first week with the Polo. Even the radio wouldn’t play soothing songs and after listening to that idiotic woman pleading “DJ waale babu mera gaana bajaa do”, followed by Yo-Yo Honey Singh informing me conversationally in the middle of the downpour that “Din Hain apparently Sunny Sunny Sunny Sunny Sunny Sunny”, I was completely disheartened. I had had it.

Hubby was absolutely enjoying the whole process and had started taking unusual amount of interest in my daily “Aaj ki Polo khabar” ravings and rantings. After listening to my conspiracy theory on how the same radio stations were playing different songs for the Polo drivers, he couldn’t control his glee at all. “You could try writing “Who moved my indicator controls? We’ll get Subbarao to write the foreword for your book,” he suggested wickedly. “Oh, shut up. I’ll write Econ Mom and the Cursed Car instead,” I muttered darkly.

Sigh! As if I did not have enough on my plate, J K Rowling, of all the people, had decided to come out with a badly written book.  Lil One and I had quite a merry little boxing bout the day it arrived home, which I won mostly by virtue of tickling him (“That’s cheating, Mom!”) and then packing him ceremoniously off to school. But I was so badly, badly disappointed. The max humor content the book has to offer is when Albus Potter tells Scorpio, “Yeah, you can’t be Voldemort’s son. You’ve got a nose!”

Oh, really. C’mon, is this Rowling? To read a Potter without the witticism and the detailed plots and well-developed character nuances was such a culture shock. It was exactly like putting a Honda driver into a German car.

And then, the GST Constitutional Amendment Bill was passed. Such a rude shock for us economists! I mean, how could they? The monsoon session had started properly enough, with Rahul Baba dozing off and the rest shouting madly. Now, technically, this fervour had to be followed up with paper balls, flinging of chairs, and well, maybe pepper spray for high drama. Chidambaram had to shout that the NDA does not know its economics, and Subramaniam Swamy had to follow it up by saying that nobody in the world knows economics. An apoplectic-with-moral-rage Arnab, falling markets and a witty Tweakonomics piece by Yours Sincerely would wrap it up nicely.

So there I was, waiting for the Amendment not to go through, when it went through! Unanimously! And that is BIG news. It’ll mean a lot of changes in the short run, but the longer run gains should make up for the trouble. A single-window for indirect taxation, lesser administration, more transparency, lesser subjectivity in assessments, lesser time in transit and hopefully, a fair sharing-between-states system. It is what every economist had dreamt of.

And yet, there I was, confused. How can the UPA behave so professionally? Now whom will we blame for the low-pace in reforms? When you have all politicians rooting for taking reforms ahead, rather than play their own silly partisan games, it creates a rude shock in the minds of innocent citizens like me. Exactly like putting a Honda driver into a German car.

Epilogue

After driving the Polo for about 10 days, I got my car back. Oh, the feeling! I could have run to it and honked in slow motion! God must have sensed the romance and sent a small drizzle my way.

I immediately sat in my car and then, to my horror, started reflexively moving my right hand to start the wipers. To my consternation, the indicator lights started ticking, while the wipers wouldn’t budge. The radio informed my frayed nerves that “Hafte mein chaar Shaniwar hone chahiye”. OMG. Now I’m a German driver in a Japanese car. Help!

 

 

Tax tamasha!

Dear Reader,

Hi! Here’s a farce on the passage of the GST Constitutional Amendment Bill, which appeared under my column “Tweakonomics” in the Hindu Business Line today. You can see it at http://www.thehindubusinessline.com/opinion/tax-tamasha/article8943703.ece; else read it here directly.

Cheers!

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GST, Amma Tax and a lot of farce!

Clever Guptaji (in concern): What is it, Sir? I’ve never seen you this tired before! Tch, tch, they really shouldn’t make innocent, lazy people attend Parliament. It is such exhausting work!

Netaji (groaning): Oh, the boredom! I tell you, the FM went on and on about “streamlining the cascading effect of taxes and the move from origin-based to destination-based taxes”. I can never quite figure out what the man is saying. There was only one interesting moment in his speech, when he spoke about “compensation for the revenue loss”. I agreed with him heartily on that, but Chidambaram wouldn’t allow me to express my gratitude.

CG (alarmed): Oh, Sir, thank God that Chidambaram Sir restrained you! The States with high levels of industrialisation collect VAT and sales tax. But they stand to lose out, as GST will imply that the destination States get the revenues. Thus, developed States opposed GST till they were assured that they would be compensated for the loss. The FM was talking about compensating the States, Sir, not compensating you! I hope you listened to PC and did not utter a word!

Netaji (uncomfortable): Oh, now don’t you start boring me, Guptaji. I have had enough of this stuff to last a lifetime.

CG (smiling): So Sir, could you participate in the debate at all?

Netaji (indignant): Participate? I tore the session apart with my yelling! You see, I am one of the few Chosen Ones by High Command.

CG: What? You are Harry Potter? The Chosen One?

Netaji (turning red): Now don’t you start getting clever, Guptaji! I meant, we are a small group of people in the inner circle of the High Command. So, when Rahul Baba pretended to fall asleep (that was our signal), we immediately started yelling that GST cannot go through because the PM himself opposed it when he was CM.

CG (dismayed): But you’ve been yelling the same thing for the past two years! What did the PM do?

Netaji (uncomfortable): Oh, he gave us a little wave from the other end of the House and smiled at us. (Suddenly gleeful) But heeheehee! He too became uncomfortable when The BJP Rajya Sabha Economist made a grand entrance into the Parliament later.

CG (interestedly): And, what was HE saying now?

Netaji (laughing heartily): He said the GST is not really a game changer. It is already implemented in 160 other countries, so the tax is not really “Indian at heart”. He also threatened to expose 27 other levies that seemed to be non-Indian. Heehee! That made them uncomfortable. Their own economist!

CG: Sir, did the AIADMK agree to the idea? Tamil Nadu says that as a “producer state”, it stands to lose out crores if the GST gets implemented.

Netaji (face clouding): Oh, they were making a noise alright. Chidambaram made an innocent statement that the GST should be debated properly as it is the “Mother” of all indirect tax reforms. And then, these AIADMK people got aggressive. One of them said they will support the Bill , but you have to name the tax as the “Amma tax”!

CG (mumbling): Yeah, only that was missing. Amma canteens, Amma water, theatres, and now, Amma tax! What did you do, Sir?

Netaji: Baba fell asleep. So on cue, we shouted that the GST cannot be passed because the PM opposed it when he was CM.

CG: Aaaaaaaaaaaaaaaaaaaargh!

The Book Clash of Titans: Reimagining Subbarao and Chidambaram

Dear Reader,

Hi! Ever since Dr. Subbarao published his memoirs, Mr. Chidambaram has lost his sleep. This piece was published under my column “Tweakonomics” in the Hindu Business Line today. You can see it at http://www.thehindubusinessline.com/opinion/columns/bookclash-of-titans/article8902443.ece; else read it here directly. Enjoy!

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It’s memoir time, much to the horror of the UPA in general, and P Chidambaram in particular. D Subbarao, the ex-Governor of the RBI, the original inflation-warrior of India is back, and how! In his book Who Moved My Interest Rates, Subbarao gives a dekko into the strange undercurrents between the Government and the RBI.

Faced with back-to-back droughts, high inflation figures, a scam-ridden coalition Government unable to take decisions and a global crisis, this RBI Governor was known not only for keeping the interest rates high, but also for sticking to his stance unfailingly.

Students of macroeconomics are often taught the IS-LM model, with the IS curve representing the fiscal side of the economy and the LM curve representing the monetary side. But, never have the IS and the LM curves cut each other so sharply, as in the time of the great Subbarao-Chidambaram tussle. The Government was worried about growth, and the RBI, about inflation. Repo rates were high, tempers, higher. Chidamabaram was red with anger. Subbarao shrugged calmly, and raised the rates some more.

Back in the rum old days of the global crisis, Chetan Bhagat was not yet decided whether to become an environmentalist, feminist or a plain economist. But the Subba story inspired him. Looking at some of those super high repo rates in the 8 per cent range, Bhagat decided to go the economist way. He had then offered to write Subbarao’s biography, Eight Point Someone. Subbarao considered the offer with his usual calm countenance, shrugged, and increased the rates promptly.

But this time, despite upping the rates, he was not very calm inside. The writer’s bug had caught him. Bhagat’s offer had stuck to his mind. “But I’ll be damned if I allow this man to write A Fort-Night at the RBI for me. Nah, I’ll write all of this myself! And God knows, there’s enough material here to create an encyclopedia! An entire Chamber of Secrets to be opened. Pride and Prejudice, unlimited. Malice in Wonderland. Oh, I’ll be the definitive Interpreter of Maladies. And to write the Lion, the Witch and the Wardrobe full of skeletons will be so much fun!” His thoughts complete, he was at peace. And he Atlas(t) Shrugged, and raised the rates some more.

He initially had thought of writing the 7 Habits of Effective Central Bankers. It would be a simple book with only one page:

Keep interest rates high.

Keep interest rates high.

Keep interest rates high.

Keep interest rates high.

Keep interest rates high.

Keep interest rates high.

Keep interest rates high.

Even as Subbarao was contemplating the title of his book, Chidambaram started reading The Game of Thrones. He was thrilled by the cutting dialogues, and feeling clever, called up Subbarao. “Inflation is so terribly final, while growth is full of possibilities.” But he had underestimated Subba. The RBI Governor simply said, “Spoke to Modi yesterday. Winter is coming.”

Chidambaram, enraged, tried the Scarlett O-Hara track, “Sir,” he cried, “You are no gentleman! You will be Gone with the Wind!”

Subbarao commented, “Frankly, my dear, I don’t give a damn.”

Chidambaram, ever the wily lawyer, changed tracks to Iron Man. “What’s the point of owning a race car if you can’t drive it?”

But this is Subbarao we talk about. He simply shrugged (Chidambaram turned white) and said quietly, “Jarvis, do me a favour and increase the rates some more.”