Thursday, November 06, 2008

The enigma of victory

Obama needs to tap the same genius that Roosevelt did in the 1930s

As a media professional I can certify that the Obama-McCain presidential race was the most intensely scrutinsed US election in India. I am not sure why this was so. Perhaps our networks and newspapers did not have enough domestic news. But that’s unlikely. Many TV networks sent their top anchors to the US to cover the polls and aired the election day as closely as CNN or any American channel. All this would undoubtedly involve a massive commitment of time and money.

The reason is partly related to why the election was historic in the US—a black man was elected president for the first time in the history of that nation. That is important enough, but what was probably more was the circumstances in which the election has taken place. The world is in the midst of an economic crisis whose full contours are not yet fully visible. It could well be the worst in the last 100 years, it certainly is the worst in the last fifty. This is not just a crisis of liquidity or even solvency. It is one that has shaken the very foundations of global capitalism. But the message we got from Washington was that no one was in-charge, or that those who were were hopelessly inept. Time and again in the last eight years, the Bush Administration officials displayed overweening arrogance, and rank incompetence.


But the crisis as such is deeper. Its beginnings lay in the surge in oil prices, high food prices and global inflation beginning from the start of 2008. The credit crisis actually came as a double whammy. The result has been in massive foreclosures of mortgages affecting millions of people in the US and, now, with the US and other major economies in recession, we are faced with the spectre of unemployment. In the past decade as Asian economies raced ahead, there was some vanity suggesting that they had decoupled from the US and European economies and could, when push came to shove, pull them out of trouble. There have been suggestions notably from the Russian Foreign Minister Sergei Lavrov that the world has an opportunity to push the US aside and use the power of the Chinese and Indian economies to reshape the world economic order.
That scenario is merely wishful thinking. It has since become painfully apparent that we will all sink or swim together. For this reason the world looks to Washington for leadership and is visibly relieved that the new President-elect of the country, Barack Obama, has that key ingredient needed—the ability to generate hope. In this sense he can be compared more to Franklin Delano Roosevelt, whose “we have nothing to fear but fear” slogan was like a lifeline for the US in deep in depression caused by the Great Crash of 1929. More than his deeds, which came subsequently over the span of three administrations, it was FDR’s persona that helped keep the American soul together in the grim early 1930s.
Roosevelt’s New Deal not only catered for the unemployed, but acted to push for the recovery of the economy and reform the banking and economic system to prevent another recurrence of the crash. The regulatory system that was created in a range of areas such as stock markets, aviation, drugs, and housing have endured. He was responsible for creating the Social Security System in the US.


Like Roosevelt, Obama has been thrust into a country whose need for reform does not stop at its devastated financial sector. He and his team must mend American banking and finance system, as well as Medicare, Medicaid and Social Security. He has promised to make the health care system the centerpiece of his social policy in a country, said to be the richest in the world, but where 16 per cent of the people do not have access to any kind of health insurance. Obama has to do all this in a country whose national debt stands at a staggering $ 10 trillion.
What Obama does for the United States has profound implications for the global economy given the economic power of the US. Just how the bad news from the US has impacted on us is evident from the travails of the business process outsourcing industry in India. Obama may have taken a stand against the industry in the past, but the issue now is not whether or not the industry is good or bad for the US or India, but whether it will survive at all.
Obama confronts even bigger challenges abroad. FDR became a war president in his third term in office when Japan attacked Pearl Harbour. Obama begins as a war president from day one. The war in Iraq may be winding down, but the one in Afghanistan is in full bloom. That brings Obama close to an area of India’s strategic concern. Obama’s remarks on Kashmir seem to have set the cats among the pigeons. But there is no need to press the panic button. New Delhi is, after all, itself engaged deeply with Pakistan in trying to resolve the issue. In fact, US intervention could well work on India’s behalf in persuading the Pakistanis to accept a reasonable compromise.
Whatever the US may do, they are unlikely to derail the India-Pakistan process. Everyone knows that the only non-utopian solution to the Kashmir issue lies in recognizing the existing sovereignties in the state. If anything, the Talibani fires raging in Pakistan would be a disincentive for any large-scale meddling with the political status of J&K.
US leadership is also required in other world-order concerns such as climate change or non-proliferation. None of these are of concern to India specifically. The Comprehensive Test Ban Treaty could be one outcome, but if the US and China are willing to sign it, there is no reason why India should hold out.


Whatever be the situation, trom the geopolitical point of view, the balance of power has shifted in India’s favour since the last time around, in 1999, when the US got involved in the region by pulling Pakistan’s chestnuts out of the Kargil fire. The passage of the Indo-US nuclear deal, courtesy George W Bush, has actually strengthened India’s hand not just in relation to Pakistan but the United States itself.
In fact, the time has come for India to be much more focused on what it wants from the US and to go out and obtain it, without the kind of debilitating debate that we undertook over the Indo-US nuclear deal. India has a lot to offer the US, primarily its ability to assist the US in restoring normalcy in Afghanistan, preserving the stability of the South and Central Asian region and ensuring the security of the sea lanes of the Indian Ocean. India can play a role, too, in trying to dampen the conflict between the US and Iran. One of the biggest challenges that President Obama confronts will be in dealing with Teheran. As of now no one in Washington seems to have a policy that has a chance of succeeding. Primarily this had to do with the neoconservative sabotage master-minded by Vice-President Cheney’s office. The new administration can start with a clean slate and the situation within the country indicates that should Washington adopt a non-confrontationist posture, Tehran would reciprocate. This would go a long way in preventing a catastrophe that could be as ruinous for the US, India and the world, as the present economic crisis is proving.
Perhaps the most important thing that India, the world and even the United States is looking for in the new Obama Administration is competence. The neocons with their extravagant paranoid fantasies were also remarkably incompetent in executing the projects they began. Their Reaganite economic policy counterparts, too, turned out to be men of straw. We can only hope that an Obama is able to tap the kind of genius FDR was able to and take his country to greater heights.
The article appeared in Mail Today November 7, 2008

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