Jekyll2021-05-14T07:55:29-05:00https://muktabh.xyz/feed.xmlMuktabh’s WebsiteMuktabh's contact and musingsThoughts On Cryptocurrencies2021-02-25T00:00:00-06:002021-02-25T00:00:00-06:00https://muktabh.xyz/2021/02/25/Thoughts-on-Cryptocurrencies<p>Some thoughts on cryptocurrencies from my Quora answers :</p>
<h3 id="my-answer-to-will-bitcoin-reach-50k-usd">My answer to “Will Bitcoin reach 50k USD?”.</h3>
<p>This was answered here : <a href="https://qr.ae/pNQXvY">https://qr.ae/pNQXvY</a> before it actually did.</p>
<p>With all the countries switching on their note printers post pandemic, a lot of people would like to invest into something that doesn’t lose value by government overprinting money. So I guess Bitcoin will continue going up. {You can think of bitcoin as a hedge against bad monetary policy of a country and some competition for the government to make investing in their country lucrative for retail investor}</p>
<p>I hope it keeps going up and I make money for a new laptop hopefully ;)</p>
<h3 id="my-answer-to-which-one-is-a-better-investment-choice-among-bitcoin-ethereum-and-ripple-in-2021">My answer to, “Which one is a better investment choice among Bitcoin, Ethereum, and Ripple in 2021?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNQXva">https://qr.ae/pNQXva</a></p>
<p>Diversify. Don’t put your eggs in one basket. Don’t invest just in cryptocurrencies, in cryptocurrencies, don’t just invest in btc or eth.</p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image1.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image2.jpeg" alt="" /></p>
<p>I personally think ethereum holds more promise as it being a blockchain ecosystem, can support much more than just a currency. ETH2 with proof of stake rather than proof of work, might be what makes cryptocurrencies useful for microtransactions finally.</p>
<p>Ripple is trash in my personal opinion.</p>
<p>Any crypto bet is very speculative, so only invest what you will not get destroyed on losing fully. Regulations , specially in a time when governments are switching on their note printers, can shock crypto valuations.</p>
<h3 id="my-answer-to-which-one-is-the-best-cryptocurrency-next-to-bitcoin">My answer to “Which one is the best cryptocurrency next to bitcoin?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNQXnK">https://qr.ae/pNQXnK</a></p>
<p>Cryptocurrency wise Ethereum looks good to me as well.</p>
<table>
<tbody>
<tr>
<td>[Ethereum Posts 450% Gain in 2020, Beats Bitcoin</td>
<td>Finance Magnates](https://www.financemagnates.com/cryptocurrency/news/ethereum-posts-450-gain-in-2020-beats-bitcoin/)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image3.png" alt="" /></p>
<p>Another crypto I have seen making good returns is Cardano.</p>
<table>
<tbody>
<tr>
<td>[Cardano gains 20% amid a high buying spree</td>
<td>Nairametrics](https://nairametrics.com/2021/02/07/cardano-gains-20-amid-a-high-buying-spree/)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image4.png" alt="" /></p>
<h3 id="my-answer-to-is-it-best-to-buy-altcoins-with-btc-inr-or-dollar">My answer to “Is it best to buy altcoins with BTC, INR, or dollar?”</h3>
<p>originally answered here : <a href="https://qr.ae/pNj85c">https://qr.ae/pNj85c</a></p>
<p>I don’t think it matters a lot.</p>
<p>You could however use Bitcoin’s faster rising value as compared to many other coins as a trick to buy more coins by putting your dollars/rupees into Bitcoin for a few weeks and then later buying altcoins by Bitcoin than you would have in case you bought them directly. But this is speculative and might not work.</p>
<h3 id="my-answer-to-is-dogecoin-worth-buying-in-2021">My answer to “Is Dogecoin worth buying in 2021?”</h3>
<p>Originally answered here : https://qr.ae/pNEyy9</p>
<p>I have some DOGEcoin which I bought during the #HoldDOGE thing. It rose very fast then {and was the best return you could imagine for a few days} but has been falling since then. Since then, Hold the DOGE movement is kind of dead. I am still holding it though, maybe it rises later, maybe will buy some more when its cheap. :-D</p>
<p>More seriously, unlike bitcoin which is a limited resource somewhat like Gold, DOGEcoin is more like our day to day currency without a central bank. Its a very different type of currency from btc and would serve a very different usecase if it ever becomes mainstream.</p>
<h3 id="my-answer-to-should-i-invest-money-in-ethereum-eth-in-february-2021">My answer to “Should I invest money in Ethereum ($ETH) in February 2021?”</h3>
<p>Originally answered here : https://qr.ae/pN6MjO</p>
<p>As of now, Ethereum is on a boom we have never seen. People have made as much as 40% returns in last 2–3 weeks. So yeah, I guess its not a very bad advice to invest in Ethereum right now. I see it as with more currency getting printed all across the world to push COVID stagnated economies, governments around the world have now scaled their money printers to a limit we have never seen. Its an unknown scenario for everyone {never has happened before}, so people aren’t sure how it all will turn out. They are just using cryptos like ETH and BTC as an alternative. If someday with some probability, regular currencies become valued at the paper they are printed on, they should have some money that is free from money printers.</p>
<p>That said, just like any other investment, there is a fear of correction. If the money printing spike doesn’t trigger a hyperinflation {there are some theories about why it has not yet triggered one} , cryptocurrencies might lose some speculative value or better the returns would get worse. So invest only what you can afford to lose, don’t get too greedy.</p>
<h3 id="my-answer-to-does-elon-musk-own-dogecoin">My answer to “Does Elon Musk own Dogecoin?”</h3>
<p>Originally answered here : https://qr.ae/pNcquh</p>
<p>That is like asking “Does Mukesh Ambani own Rupee ?”</p>
<p>Rupee is a currency and is owned by no one. Mukesh Ambani has rupees and Elon Musk may have Dogecoin, but no one owns anything. You can maybe say that Indian government owns rupee {and US government owns the US$}, but even that is not true for cryptocurrencies like Bitcoin and Dogecoin. In fact the entire point of bitcoin’s invention was to make sure no one is a central authority in the currency {and from what I know, dogecoin is a copy of bitcoin in that regard} .</p>
<h3 id="my-answer-to-what-are-your-thoughts-on-bitcoin-crashing-10k-usd-on-the-23rd-of-february-2021">My answer to “What are your thoughts on Bitcoin crashing 10k USD on the 23rd of February 2021?”</h3>
<p>Originally answered here : https://qr.ae/pNQXnX</p>
<p>Any commodity has fluctuations in its price. Bitcoin fell on 23rd Feb, is rising back again (24th Feb). No big deal.</p>
<p>Unless there is a big shocker event hampering bitcoin or people’s interest slowly dies off, these noises in price will stay and Bitcoin will continue to rise to get its eventual stable value. <a href="https://www.quora.com/Who-would-be-responsible-if-the-Bitcoin-price-just-crashed-to-pennies/answer/Muktabh-Mayank?ch=10&share=42fc97ea&srid=qie">Muktabh Mayank’s answer to Who would be responsible if the Bitcoin price just crashed to pennies?</a></p>
<h3 id="my-answer-to-what-technology-is-used-to-record-cryptocurrency-transactions">My answer to “What technology is used to record cryptocurrency transactions?”</h3>
<p>Originally answered here : https://qr.ae/pNMaeT</p>
<p>Let’s understand in very basic terms what a cryptocurrency is :</p>
<ol>
<li>
<p>Whether one paid to another person or not is verified using the concepts of public and private keys. This is the same public key cryptography that we use to login into our Google or Quora account. Every transaction is signed using private key of the payer and can be verified by their public key. Its somewhat like you signing into your email account and sending an email to whole world that you are transferring X $ to ABC. The proof of this email was sent by you to make the transaction is stored till eternity.</p>
</li>
<li>
<p>However, just verifying a transaction is not enough to make a currency functional, the currency should also take care that the sequence of the transactions is mapped correctly too and can be verified quickly. It you are reading about these for the first time, you can basically think that the entire process of cryptocurrencies depend upon maintaining this order. One way to quickly intuit this is to think while a signed transaction of 10 cryptos from user 1 to user 2 is signed, if order is not maintained, the same signed transaction can be inserted again and again into the ledger to create fraud and extract out money from user 1. The data structure used to verify order is <a href="https://en.wikipedia.org/wiki/Merkle_tree">Merkle tree - Wikipedia</a></p>
</li>
</ol>
<!-- end list -->
<ol>
<li>. This makes sure that the order of all the previous transactions and the new transaction is mapped so that every transaction has a place in the history. As you can imagine current transaction cons’ed to all previous transaction would make a “chain” if done after every transaction. Instead of ordering each transaction , a group of transactions (block) is sequenced with respect to all previous ones to reduce computations. This Merkle Tree data structure is called a “Blockchain”.</li>
</ol>
<!-- end list -->
<ol>
<li>Now the third most important point is who gets to verify the order. Everyone can verify individual transactions using Public Key, but who gets to verify what is the right order in which these transactions were committed. The answer is “any miner on the network randomly”. Bitcoin Miners basically play roulette with each other trying to come up with some number combinations of Hash Values by adding random string to the latest block. If they win the roulette, they get a few cryptocurrency units and as long as these random miners keep competing to verify the transaction , a mathematical guarantee exists that the transaction data order is being verified correctly. If one of the miners tries to copy a few transaction in middle to make double payments to benefit them or friend, they will have to invent a mathematical system that helps them win the roulette of Cryptology Hash Functions again and again, which is impossible mathematically ! So someone who inserts a fraudulent duplicate transaction might be correct for one shot, but then the system will self correct when the next block is verified and the fraud will self remove.</li>
</ol>
<p>To answer your question specifically, the data is stored in a Merkle Block Chain Tree which is available to every miner on crypto network and anyone who wants to read and see it.</p>
<h3 id="my-answer-to-what-would-be-the-alternative-currencies-for-a-better-world-towards-eradication-of-poverty-by-currencies-i-mean-just-a-way-of-exchanging-stuff-not-necessarily-money">My answer to “What would be the alternative currencies for a better world towards eradication of poverty? By currencies, I mean just a way of exchanging stuff not necessarily money.”</h3>
<p>Originally answered here : https://qr.ae/pNJvbZ</p>
<p>We cannot eliminate poverty, whatever we do. Any currency cannot solve the problem fully. At best, we can make sure that no one is poor because they are born unlucky, that is poor because they are sick or poor because they were born to poor or abusive parents. While majority of poor people are such unlucky men,women and children, there are many who are poor due to making bad decisions. People who are bad spenders {alcoholics, gamblers, drug addicts} seem to have a mental disorder {specifically lack of willpower to say No.} , which like most mental diseases, can be managed, but not cured. You can expect many such people to be poor perennially.</p>
<table>
<tbody>
<tr>
<td>[Preface</td>
<td>National Institute on Drug Abuse](https://www.drugabuse.gov/publications/drugs-brains-behavior-science-addiction/preface)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image5.png" alt="" /></p>
<p>What we can rather do is have a security network that people can bank on to survive during times of poverty and they have a chance to fight their way out. There are concepts like Universal Basic Income and digital wallets which can get money directly into the hands of the needy in case they need. India, for example, has UPI <a href="https://en.wikipedia.org/wiki/Unified_Payments_Interface">Unified Payments Interface - Wikipedia</a></p>
<p>and Zero Balance Accounts (banks are mandated to have no minimum balance requirement for poor people) which has made getting money in the hand of the needy really easy. That is the reason you did not see a full scale rebellion in India during the super long lockdown here : India introduced a temporary UBI during the pandemic times.</p>
<p><a href="https://www.thehindubusinessline.com/info-tech/google-cites-upi-learnings-to-us-federal-reserve-for-proposed-rtgs-system/article30305827.ece">Google cites UPI learnings to US Federal Reserve for proposed RTGS system</a></p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image6.png" alt="" /></p>
<p>So FinTech with even traditional currencies has reduced the dependence of government on large institutions to aid the poor. If such a thing like UPI + Zero Balance Account were not available in India, Indian government would have to depend upon many layers of public sector hierarchy or private institutions to help the poor. The more hands involved, more corruption and lesser the welfare reaches poor.</p>
<table>
<tbody>
<tr>
<td>India had to come up with these because upto 85% of the welfare money it was spending earlier was being lost in corruption and inefficiency. So much leakage ! [Rajiv was right: Montek says only 16p of Re reaches poor</td>
<td>India News - Times of India](https://timesofindia.indiatimes.com/india/Rajiv-was-right-Montek-says-only-16p-of-Re-reaches-poor/articleshow/5121893.cms)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image7.png" alt="" /></p>
<p>At least in the sense of reducing poverty, the problem is not so much in government welfare numbers <that can be debated well before they are finalized> or the traditional currency system, but rather the bloated bureaucracy and corruption of nation states. The way to solve this is to use more efficient methods like digital wallets or zero balance account. A government which is responsible and committed to its poor needs the traditional currency system to control monetary policy, at least in the time of economic despair to avoid too much poverty.</p>
<p>However, there are even worse case scenarios possible, where because the governance is so bad, the financial system of a country breaks down and they need to print more and more money to distribute amongst people who help them run their regime. Say Venezuela or Zimbabwe like scenario.</p>
<p><a href="https://www.teenvogue.com/story/the-economic-crisis-in-venezuela-explained">Venezuelans Are Starving as the Nation’s Economic Crisis Continues</a></p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image8.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image9.jpeg" alt="" /></p>
<p>In such scenarios, leave alone making poor people better, the governments are making well to do people poor ! This is the type of scenario where alternative new currencies like bitcoin can kick in. By investing their wealth into cryptocurrencies, people can make sure that government’s poor monetary policies don’t ruin them altogether. In fact, cruptocurrencies make sure that no monetary policies are applicable to them, so your existing wealth is never getting devalued.</p>
<h3 id="my-answer-to-if-india-bans-all-private-cryptocurrencies-and-introduces-a-single-official-digital-currency-issued-by-the-rbi-how-will-it-affect-the-economy-of-india">My answer to “If India bans all private cryptocurrencies and introduces a single official digital currency issued by the RBI, how will it affect the economy of India?”</h3>
<p>Originally answered here : https://qr.ae/pNzj8e</p>
<p>There is some misplaced sense of bureaucratic logic that is driving this initiative. RBI tried to ban other cryptocurrencies while launching its own crypto and when that was struck down this has been sent to the parliament. I hope our government and members of parliament understand that CBDCs [Central Bank Digital Cryptocurrencies] and decentralized cryptocurrencies have two very different applications and banning the later is not required to get a market for the former. The competitors for CBDCs are international centralized coins like Libra {Now called <a href="https://www.diem.com/en-us/">The Diem Association</a></p>
<p>}, other upcoming CBDCs like China’s and EU’s and not Bitcoin/Ethereum and its brothers. We are fighting the wrong monster here.</p>
<p><strong>CBDCs usecases :</strong></p>
<p>The top benefits of a CBDC are :</p>
<ol>
<li>
<p>Quicker disbursement of government financial aid/UBI. While right now RBI prints currencies, sends to government/banks and banks then disburse the money, A CBDC can be minted and disbursed almost immediately after decision is made. A few years back, when this disbursal was done through cash, there was a lot of corruption and even more delay which fintech has already solved, now CBDC when combined with fintech would make the process instantaneous .</p>
</li>
<li>
<p>Tracking flow of money is another cool thing about CBDCs. While for most citizens the CBDC ledger is anonymous, the government accounts will be public and people can see where there tax money have been spent down to one rupee. This ensures certain types of corrupt practices will be much easier to detect and highlight. In a way good step to check public sector corruption.</p>
</li>
<li>
<p>Indians are already accustomed to digital currency [You have amazon wallet cash, paytm wallet cash] and so on. While right now, this cash is guaranteed by the companies, CBDC as a digital cash will be guaranteed by the government. These are two very different type of guarantees. Sudden nationalization of AliPay for example makes a lot of AliPay guaranteed digital money of SouthEast Asian and African businesses using AliPay, Chinese government guaranteed money. Not sure how comfortable people would be wit that, but private companies are under umbrella of the countries they have their effective center of control in.</p>
</li>
</ol>
<p><strong>This is in total contrast with how decentralized cryptocurrencies [like Bitcoin] are being used in today’s day and age:</strong></p>
<p>A. Decentralized Cryptocurrencies are emerging as a hedge against poor monetary practices of a government. When a government is printing money like newspaper, people need ways to preserve their wealth and not need to depend upon other governments for their currencies and CBDCs. That is what main usage of Bitcoin is in current day. Bitcoin/Ethereum is not really useful for transactions because of the slow nature of transactions.</p>
<p>B. The other prominent usage of decentralized cryptocurrency is as a vehicle currency, that is way to send money abroad without all the charges involved today. This is possibly the use that government officers might be worried about and rightly so due to security concerns. There should be strict ways to regulate the improper money transfers but in my view banning decentralized cryptocurrencies over this is a bit over the top.</p>
<p>One more concern over decentralized cryptocurrencies is that people can be conned and can lose their savings over bad explanations of the new concept of currency in software.</p>
<p>All in all, I see CBDCs and Decentralized cryptocurrencies operating in parallel without disrupting each other.</p>
<h3 id="my-answer-to-is-it-true-that-the-indian-government-is-banning-deep-learning-and-blockchain-technologies">My answer to “Is it true that the Indian government is banning deep learning and blockchain technologies?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNQXAI">https://qr.ae/pNQXAI</a> . Note this was much before Feb 2021.</p>
<p>No. Nothing like that is happening. Pure misinformation.</p>
<p>Infact, government organization Startup India ( <a href="https://www.startupindia.gov.in/">Homepage</a></p>
<p>) collaborated with Softbank ( <a href="https://en.wikipedia.org/wiki/SoftBank_Group">SoftBank Group - Wikipedia</a> ) to give Tech4Future award which my Deep Learning startup <a href="https://www.quora.com/topic/ParallelDots">ParallelDots</a> won. Details here: <a href="https://www.business-standard.com/article/pti-stories/paralleldots-wins-the-tech4future-grand-challenge-powered-by-invest-india-and-softbank-group-119061400236_1.html">ParallelDots Wins the Tech4Future Grand Challenge Powered by Invest India and SoftBank Group</a> . There have been other similar approaches where government is encouraging Deep Learning startups, like the latest BSF startup challenge where BSF is awarding a good autonomous UAV startup <a href="https://www.startupindia.gov.in/content/sih/en/ams-application/challenge.html?applicationId=5d07381fe4b08f8b1a9c75da">Challenge</a></p>
<p>. So AI will be soon guarding Indian borders agains terrorists.</p>
<p>Similarly with blockchain. Almost all forums for government startups list fintech, AI, blockchain and robotics as the next area to target. Government plans to build blockchain itself for multiple uses: <a href="https://www.coindesk.com/indias-national-payments-corporation-wants-to-build-a-blockchain-solution">India’s National Payments Corporation Wants to Build a Blockchain Solution - CoinDesk</a></p>
<p>There is one place where the government is very hesitant to allow companies: cryptocurrencies. Cryptocurrency is one of multiple ways where blockchain technology can be used. It is <strong>controversial</strong> and <strong>has been used to take advantage of poor and less informed people</strong> in other countries. Indian government is right IMO to have reservations about usage of such a technology. Its a systemic risk and needs to be regulated (regulated is not banned BTW).</p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image10.png" alt="" /></p>
<p>https://youtu.be/-Jn41vwZd94</p>
<p>India has not banned even cryptocurrency completely as of yet btw :</p>
<p>I am tired of writing a <a href="https://twitter.com/coincrunchin?ref_src=twsrc^tfw">@coincrunchin</a> article after reading shitty articles by Mainstream media. So lets do a thread.</p>
<p>The report: India is bringing a law to ban crypto trading is written by <a href="https://twitter.com/archchaudhary?ref_src=twsrc^tfw">@archchaudhary</a> & Siddhartha Singh.</p>
<p>It has been syndicated to many other news portals.</p>
<p>— Naimish Sanghvi (@ThatNaimish) <a href="https://twitter.com/ThatNaimish/status/1305958392985350145?ref_src=twsrc^tfw">September 15, 2020</a></p>
<p>IMO, we should have restrictions on bitcoin businesses just like we have SEBI for public companies.</p>
<p>In case involuntary public facial recognition using Deep Learning starts, people will want government to put limitations on Facial Recognition Deep Learning startups too. That will not mean banning all Deep Learning startups.</p>
<h3 id="my-answer-to-how-will-rising-inflation-affect-the-global-economy">My answer to “How will rising inflation affect the global economy?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNQXtl">https://qr.ae/pNQXtl</a> [in context of a possible inflation post COVID19 disruption]</p>
<p>We have not seen retail inflation rise yet despite of governments running their money printers due to pandemic disruption. Some people think that maybe economies {at least the US economy} has become resistant to inflation forever because the supply of money printed into retail economy is not that huge. The money being printed is mostly buying assets from banks which can be further lent out/invested.</p>
<p><a href="https://youtu.be/3-dvi1f_2vA"><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image11.png" alt="" />https://youtu.be/3-dvi1f_2vA</a></p>
<p>We have no other alternative to money printing during a pandemic. The direct handouts to people was not really enough for them to go splurging after goods, but just to keep the economic motor running. We needed that to avoid a depression. If the money supply in economy would have reduced due to people saving instead of spending, the economy would go into deflation mode. Retail inflation is thus controlled as money supply has been restricted to look like normal circumstances and not excess of cash. The most responsible economies are the ones who have just printed this much money or not much more than this money to keep economy afloat. Responsible is safe, but might not be the best.</p>
<p>But all the stimulus given out in US was not to individuals, a lot of it goes to financial institutions too. Whether pumping much more money into banks and financial institutions has actually increased economic risk is yet to be seen. However, it does feel that there would be two long term effects :</p>
<ol>
<li>
<p>People are seeing wealth rise in stocks. Stock markets have been on a rally. While investors are being clever and investing in long term stocks like tech and alternative energy, its not like their wealth is not going up and all they are looking for is delayed gratification. When all this wealth increases, some day it might come back to retail markets when people want to cash out. Whether that changes the inflation/affordability in long term is to be seen. Maybe the hyperinflation that would happen today if all money was dispersed into the economy will slowly balance out as increase in purchasing power over years as these investments yield opportunities ? There is no historical lesson for such a thing so we still need to wait and watch.</p>
</li>
<li>
<p>Another topic is while there are people who are using the government handouts to just sustain themselves, there will be people whom these stimulus would make extremely rich and in control and knowledge of resources of future. So there is going to be increase in inequality and gatekeeping. This might lead to a feudalistic society with happy serfs living on handouts but being so far behind the elite (and their clergy) that their is no way they could bridge the gap [and maybe they don’t even want to if handouts are decent enough]. Think of it, there are people who got 1200 dollars to handle their life’s complexity while others, unknowingly to them (as it did not cause any inflation/inconvenience), just gained immense power over them by becoming future rich through the technologies which are supposed to run the world in future. This is not just a 1%-er discussion by the way. Someone who bought two iPhones and airpods last year lost out considerably to someone who could manage with a cheap Android and invested the rest in Tesla. We don’t really know if a society of happy serfs exists [because their hasn’t been one], serfdom used to become unsustainable making sure a deliberate or forced wealth redistribution occurred. Or maybe we actually voluntarily redistribute the wealth as inequality rises and the TV series Brave New World has had too much effect on me :P .</p>
</li>
</ol>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image12.jpeg" alt="" /></p>
<h3 id="my-answer-to-how-does-a-tweet-from-a-high-profile-person-change-the-market-value-of-crypto-eg-elon-musk">My answer to “How does a tweet from a high profile person change the market value of crypto, e.g., Elon Musk?”</h3>
<p>Originally answered here: https://qr.ae/pNEyrj</p>
<p>Any investment is mostly about trust, and damn people trust Elon Musk. Look at his online fanboys and believers. Whatever new technology he has touched {digital payments in paypal, Electric cars in Tesla and reusable rocktships in Spacex have become mainstream}. Elon Musk endorsing Bitcoin, not just verbally but also Tesla putting over a billion of its money in bitcoin, in a way convinces many people that Bitcoin will be real and not just a toy for nerds.</p>
<p>Crypto’s market value will rise until :</p>
<ol>
<li>
<p>Either it fizzles back into oblivion like previous times,</p>
</li>
<li>
<p>Or it becomes mainstream and rises until crypto achieves its actual value after which it would go stable.</p>
</li>
</ol>
<p>The odds of two becoming a reality become much more have suddenly gone up with Tesla putting money into it. That is the reason why people are investing like crazy to take advantage of a possible boom until stability/corrections.</p>
<h3 id="my-answer-to-elon-musk-stated-bitcoin-is-arguably-deflationary-to-a-fault-what-does-he-mean-by-that-how-can-an-asset-to-be-deflationary-to-a-fault">My answer to “Elon musk stated “bitcoin is arguably deflationary to a fault” what does he mean by that? How can an asset to be “deflationary to a fault”?”</h3>
<p>Originally answered here : https://qr.ae/pN6dFE</p>
<p>Elon Musk is not talking about cryptos as currencies and not assets.</p>
<p>Bitcoin is prone to deflation because you cannot print Bitcoin beyond a certain limit. There have been visible problems in the past when supply of day to day currency was limited by some factor {say gold standard in 19th-20th century}. The fear of individuals during bad times can trigger a deflationary spiral like 1930’s great recession.</p>
<p>This is exact opposite is what happened in Zimbabwe or current day Venezuela is excess note printing. The currency becomes newspaper in such cases. You cannot just increase currency supply and solve all problems. However, in times like the COVID crisis when people dont want to or cannot spend, government needs to print and spend.</p>
<p>We are seeing both point of views take place in real world crypto. While bitcoin is being bought as a bet against note printing machines as it cannot be diluted by making more currency, Elon’s new favorite DOGE is being thought to be a day-to-day use cryptocurrency. New DOGE coins can be printed with certain rules. With the record breaking currency being printed, people are buying Bitcoin and Ethereum as a hedge. DOGE on the other hand is seeing a surge as people think its going to be a day to day crypto {at least the Reddit WSB community believes so}</p>
<p>I guess the point is that people can have opt in or opt out of currency policy as they wish. [Which is really cool !]</p>
<p>Few hours after I write this answer :</p>
<p><a href="https://www.msn.com/en-us/money/companies/tesla-buys-2415-billion-in-bitcoin/ar-BB1duGM7">Tesla buys $1.5 billion in bitcoin, plans to accept it as payment</a></p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image13.png" alt="" /></p>
<p>Elon is not really “anti bitcoin” if it felt like that in anyway :</p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image14.png" alt="" /></p>
<h3 id="my-answer-to-does-bitcoin-price-rise-and-volatility-simply-a-symptom-of-our-lizard-brain-to-want-to-gamble-what-more-evidence-do-you-need-than-seeing-that-those-with-least-knowledge-of-the-technology-and-cryptography-have-punted-the-most-on-bitcoin">My answer to “Does bitcoin price rise and volatility simply a symptom of our lizard brain to want to gamble? What more evidence do you need than seeing that those with least knowledge of the technology and cryptography have punted the most on bitcoin?”</h3>
<p>Originally answered here : https://qr.ae/pN6dHH</p>
<p>Unlike what many of us think, you don’t necessarily need to understand things in depth completely to make something work. You need to have one correct idea about the situation that is working and scale it more and more.</p>
<p>While understanding things is a full time profession, doctors, engineers, scientists, economists do it all the time, that doesn’t really mean they are the only ones who sell technology or innovate or be an athlete. In simpler words, a doctor who understand how body functions can be an athlete, but an athlete doesn’t need to be a doctor. For being an athlete, one has to practice one skill that is running, for being an athlete and a doctor : one has to practice two skills, running and medicine. If anything being an athlete and a doctor is harder than just being an athlete or being a doctor.</p>
<p>So all you need to understand while investing in bitcoin is its behavior as an asset, when to buy and sell. You need to understand some of the technology, but bitcoin was invented to be a normal day-to-day currency and not a “currency for computer science graduates” and requires one to understand day to day economics to use it.</p>
<p>Another thing is that everyone needs to know is that gambling is not bad. In fact, its good and should be encouraged for the amount of risk appetite one has. Goes without saying that mindless gambling is much more than one’s risk appetite and is stupid. If Wright brothers did not gamble, we wouldn’t have the aircraft, if Columbus did not gamble his life {and queen of Spain her money} we would not have Americas. I have no idea why gambling is being called lizard’s brain here !</p>
<h3 id="my-answer-to-who-would-be-responsible-if-the-bitcoin-price-just-crashed-to-pennies">My answer to “Who would be responsible if the Bitcoin price just crashed to pennies?”</h3>
<p>Originally answered here : https://qr.ae/pNj8W9</p>
<p>Some shock event.</p>
<p>One possibly big roadblock that can hit bitcoin and other cryptocurrencies is regulation by different countries banning their use.</p>
<p>This might be done for variety of pretexts :</p>
<ol>
<li>
<p>Fear of investors being taken advantage of</p>
</li>
<li>
<p>Pushing CBDCs issued by central bank</p>
</li>
<li>
<p>Avoiding cryptocurrencies giving competition to local banking system.</p>
</li>
</ol>
<p>In case of regulations by major countries like US, EU, China and India, bitcoin might dive in value.</p>
<p>Apart from this the only problematic event I can think of is fizzling out of the interest in crypto just like it happened in previous volleys. However, in such case, price will not crash but come down more gradually.</p>
<h3 id="my-answer-to-will-golds-value-be-wiped-out-like-aluminium-if-bitcoin-becomes-the-official-currency">My answer to “Will gold’s value be wiped out like aluminium if Bitcoin becomes the official currency?”</h3>
<p>Originally answered here : https://qr.ae/pNJvOw</p>
<p>No way ! Not for a few centuries.</p>
<p>Gold is never “going out of fashion”, unless of course we start mining asteroids for gold and we have so much gold that you have gold like Iron. [That is not impossible by the way, but a distant scenario]</p>
<p>Bitcoin somewhat does many functions of what gold is in today’s world :</p>
<p>A. International Currency</p>
<p>B. Value independent of governments’ monetary policies thus free from Quantitative easing</p>
<p>C. Both are incorruptible in value. Bitcoin due to mathematical guarentee and gold due to its deep cultural connection. [I mean you can mix stuff in Gold I am not speaking of that kind of purity] . You can be sure if you hide Gold underground and take it out 500 years later, 1. Gold is a nobel metal so it will not get corrupted chemically and 2. people would still value it, its not going to become just a piece of metal. Botcoin has property 1 but still needs to stand the test of time on property 2.</p>
<p>D. Limited. You have scarce new bitcoin with time and you have somewhat scarce gold in the world.</p>
<p>The reason why gold will not go the way of Aluminum is <strong><em>D</em></strong> . Aluminum is one of the most abundant elements {the most abundant metal infact, more than Iron} in Earth’s crust so its value was high because it was hard to extract, bot because it was rare. <a href="https://en.wikipedia.org/wiki/Hall–Héroult_process">Hall–Héroult process - Wikipedia</a></p>
<p>disrupted its value by making extraction of Aluminum cheap. Gold, however, is hard to become easy, because humans have already mined most of easily accessible Gold from Earth.</p>
<p><a href="https://www.buybitcoinworldwide.com/how-many-bitcoins-are-there/">How Many Bitcoins Are There?</a></p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image15.png" alt="" /></p>
<p><a href="https://www.bbc.com/news/magazine-21969100">How much gold is there in the world?</a></p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image16.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image17.png" alt="" /></p>
<p>The cost of gold mining is going up [because of the nature of deposits left to extract and high environmental cost] and it might eventually become pointless to mine it due to this factor. {This is less sure of a scenario than final bitcoin however as we mind end up finding new deposits in Earth or mine gold from asteroids}.</p>
<p>Bitcoin [and other cryptocurrencies] are an alternative to Gold, but they are still not complete alternatives, [Look at point C above]. It will take centuries to establish whether they are able to stand the test of time like Gold and thus you can be sure that Gold is not going away for that amount of time. Maybe even after that it lives as one alternative international currency along with cryptos.</p>
<h3 id="my-answer-to-what-do-you-think-has-more-value-in-todays-world-data-or-money">My answer to “What do you think has more value in today’s world, data or money?”</h3>
<p>Originally answered here: https://qr.ae/pND8bJ</p>
<p>Data is the new money ! I mean all cryptocurrencies are just cryptographically anonymized data about spending.</p>
<p>Power comes from many sources : Data is one source, Money is another, power of state is one source, belief of people is another source, skill is one such more source of power.</p>
<p>I think the answer is situational as data can be used to generate money and money can be used to create infrastructure to accumulate data. Its like answering the question about whether a Lion wins in a fight or Tiger. Case by Case.</p>
<h3 id="my-answer-to-why-dont-currency-notes-have-digital-signatures-that-way-a-note-cant-be-counterfeited-unless-criminals-know-the-signature-as-well">My answer to “Why don’t currency notes have digital signatures? That way a note can’t be counterfeited unless criminals know the signature as well.”</h3>
<p>Originally answered here: https://qr.ae/pNVwK3</p>
<p>Just having digital signatures doesn’t make currency notes robust to counterfeiting. Any digital signature can be forged {because forging is just copying, you can only make copying as hard}, not a big deal.</p>
<p>If you are referring to digital signatures like those used in centralized or decentralized cryptocurrency protocols like <a href="https://en.wikipedia.org/wiki/Ecash">Ecash - Wikipedia</a></p>
<p>or <a href="https://en.wikipedia.org/wiki/Bitcoin">Bitcoin - Wikipedia</a></p>
<p>who have guarantees of no-counterfeiting , you should understand that its not just digital signature that ensures no duplicate spend. Its a combination of <strong><em>A. Digital Signatures, B. Keeping a track of currency flow and C. Ensuring sanctity of data for point B</em></strong> which can make sure that there is no counterfeiting.</p>
<p>Unless you keep a track of cash flowing from one person to another, you cannot implement the no counterfeit property of cryptocurrencies in cash. If you want to understand how this process is done technically, please refer to my answer here : <a href="https://www.quora.com/What-technology-is-used-to-record-cryptocurrency-transactions/answer/Muktabh-Mayank">Muktabh Mayank’s answer to What technology is used to record cryptocurrency transactions?</a></p>
<p>To sum up, in cash you know where the money flow originated from [who took out the bank note from bank], but you don’t know its path. In Crypto, you know about the source of the money [all account names have anonymous signatures], and you know the entire path currency traces in terms of anonymous handles. A digital signature can only guarantee latter type of currency flow to have no counterfeiting . Cryptocurrency has much more information available, just that the information is anonymous.</p>
<h3 id="my-answer-to-is-it-possible-to-replace-all-currencies-in-the-world-with-a-common-currency-keeping-in-mind-all-type-of-factors-like-gdp-economy-development-etc">My answer to “Is it possible to replace all currencies in the world with a common currency keeping in mind all type of factors like GDP, economy, development, etc.?”</h3>
<p><a href="">https://qr.ae/pGXEhw</a></p>
<p>Theoretically Yes. However, “Keeping in mind all types of factors” is an impossible “IF” to achieve. Its not possible to keep all factors in mind in a a system as complex as world economy. There are just too many variations in culture, economic behavior and fiscal policy and a standardization so broad to make everyone under the same rules is impossible to achieve.</p>
<p>Just look at example of what happened to Greece when Greece and Germany started sharing currency [Euro] in early 2000s.</p>
<table>
<tbody>
<tr>
<td>Diem/Libra which wants to be a global currency, plans to achieve this by making sure they are convertible to any local currency. So, it will basically coexist other currencies, not replace them. [White Paper</td>
<td>Diem Association](https://www.diem.com/en-us/white-paper/#the-economic-and-the-libra-reserve)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image18.png" alt="" /></p>
<h3 id="my-answer-to-which-is-better-the-gold-standard-or-the-fiat-currency-system-and-why">My answer to “Which is better, the gold standard or the fiat currency system, and why?”</h3>
<p><a href="">https://qr.ae/pNdRi5</a></p>
<p>Both have their flaws and advantages.</p>
<p><strong><em>Fiat Currencies</em></strong> have the problem of being too centralized. Being centralized is a major risk. If the central authority f***ks up, the entire economy is done. The central banks thus need to walk a tight rope of short term and long term goals. There is a decent chance of them taking wrong decisions. We have seen Fiat Currencies doing badly :</p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image19.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2021-02-25-Thoughts-on-Cryptocurrencies/media/image20.jpeg" alt="" /></p>
<p>But on the other hand, Fiat Currencies are adaptable. That is they can be printed to maintain money supply in case the money supply is stuck. One reason for the great depression was lack of money supply :</p>
<p><a href="">https://en.wikipedia.org/wiki/Great_Depression</a></p>
<p>Central Banks did not make sure that the essential economy stays afloat by pushing new currency when people afraid of depression had stopped spending. One reason for lack of currency supply was the “gold standard”.</p>
<p>We have been avoiding great depression like anomalies in Dot Com bubble, 2008 and 2020 is because we have not let the basic economy die. The problem is that people/companies accustomed to such currency handouts might not let central bank switch back to regular business. That would lead us to hyperinflation !</p>
<p><strong><em>Gold standard</em></strong> or any fixed supply currency almost always turn out to be good stores of value. Gold and now Bitcoin have found their need as value stores but not as a currency of day to day transaction. Gold standard in its day caused many anomalies and fluctuations even during normal circumstances. In case of a deflation spiral, there is nothing that can be done to keep the economy alive. Banks can easily go bust [because banking is business of making people imagine more money exists that there is and that illusion breaks under a deflation spiral]. Even for bitcoin, we have not really yet understood what its actual value is and it keeps rising with crazy fluctuations [or maybe the dollar keeps falling or both].</p>
<p>There are experiments running to create a best of both world currency. <strong><em>DOGE</em></strong> coin, the Elon Musk favorite for example is for example a currency with increasing supply and decentralized control. Let’s see whether we can build new currencies with powers of both fiat currencies and gold standard and disadvantages of none.</p>Some thoughts on cryptocurrencies from my Quora answers :Talking About Ai Hypotheticals2021-01-26T00:00:00-06:002021-01-26T00:00:00-06:00https://muktabh.xyz/2021/01/26/Talking-about-AI-hypotheticals<p>Some thoughts around Artificial Intelligence hypotheticals. Most answers would be around “we are decades if not centuries away from building Artificial General Intelligence”, but hope you find some interesting points.</p>
<h3 id="q-how-would-machine-learning-answer-the-question-would-jack-realistically-have-died-aboard-the-titanic">Q. How would machine learning answer the question, “Would Jack realistically have died aboard the Titanic”?</h3>
<p>Originally answered here : https://qr.ae/pNz7lw</p>
<p>You cannot really make Machine Learning predictions {or any other model based predictions or human intuition prediction} for events during a black swan event like sinking of the strongest ship (or any ship in fact) by an iceberg.</p>
<p>You can use some crude approximations around rate of death of people from lower decks in case of ship accidents etc, but that likelihood would be a useless statistic in case of Titanic crash. In case of a shock/rare event/black swan luck [randomness] becomes much more powerful than in regular day to day life. Two Face is a psycho but his philosophy works in extreme circumstances.</p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image1.png" alt="" /></p>
<h3 id="q-understanding-that-a-model-is-only-as-good-as-its-assumptions-can-geneticists-knowledge-of-mapping-the-human-genome-and-high-performance-super-computers-be-used-to-quickly-assess-long-term-effects-of-vaccines">Q. Understanding that a model is only as good as its assumptions, can geneticists knowledge of mapping the human genome and high-performance super computers be used to quickly assess long-term effects of vaccines?</h3>
<p>Originally answered here : https://qr.ae/pNzjGg</p>
<p>They cannot. Human DNA is so complex that it cannot be modeled. Physical universe is large, but relatively less interconnected {thus runs on simple fundamental rules}, so you have equations that govern behavior of it and you can predict what would happen in Universe. What asteroid will be where in 5 years and which stars will go supernovae and when will our Sun die. You cannot still predict some rare black swan events though.</p>
<p>Human brain and DNA, ecology, economy, society are complex systems, that is they don’t follow fixed rules, very interconnected and interdependent, so you can identify the trends, but hard to predict the trajectory of system.</p>
<p>So while trajectory of a particle can be written in a equation with 3–4 parameters getting 99%+ accuracy in real world, an equation to guess who will default on their loan will have thousands of parameters and will still be what? 80% accurate say.</p>
<p>To predict a complex system like DNA, you require humongous data to generalize rules, maybe more than what is available in the Universe. When we have much more data and computation ability than what we have right now, we might be able to do it more accurately than we do it now, never with 100% accuracy though. As of today, we can just guess and hope for the best and make theories (which might sometimes generalize), but no one can predict.</p>
<h3 id="q-whats-your-opinion-on-elon-musk-believes-ai-poses-a-threat-to-humanity-and-is-most-worried-by-google-owned-deepmind-project-do-you-agree-with-this">Q. What’s your opinion on Elon Musk believes AI poses a threat to humanity and is most worried by Google-owned DeepMind project? Do you agree with this?</h3>
<p>Originally answered here: <a href="https://qr.ae/pNcniz">https://qr.ae/pNcniz</a></p>
<p>I don’t agree with Elon Musk.</p>
<p>There is a difference between Artificial General Intelligence ( <a href="https://en.wikipedia.org/wiki/Artificial_general_intelligence">Artificial general intelligence - Wikipedia</a></p>
<p>) , that we might possibly fear (and probably what Elon Musk fears) and the current trendy technique of Deep Learning. Deep Learning can at best be called Artificial Special Intelligence and there is no indication that the AI technology we have right now can be built to create sentient AI or AI that can challenge humanity.</p>
<p>The other possible problem one might see is job loss due to AI. I think its going to look like till 20 November 2020 human was doing a job and 21st November , an AI starts doing the job. The transition will be gradual and slow enough so that human can slowly adapt to a new skill and switch to a new job. It will be like AI starts reducing 10% of the workload , then 30% then 80% and later just needs humans as supervisors according to me.</p>
<p>Possibly one thing thar Elon Musk and governments might be worrying about is the monopoly Google (and other big tech firms) have over data and AI infrastructure. I think with latest anti trust lawsuits, legislators are addressing such concerns.</p>
<p><a href="https://www.msn.com/en-us/money/companies/google-faces-its-3rd-major-antitrust-lawsuit-as-texas-and-other-states-take-the-company-to-court-over-its-ad-practices/ar-BB1bZiRI">Google faces its 3rd major antitrust lawsuit as Texas and other states take the company to court over its ad practices</a></p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image2.png" alt="" /></p>
<h3 id="q-would-artificial-intelligence-be-possible-if-computer-programming-was-not-invented">Q. Would artificial intelligence be possible if computer programming was not invented?</h3>
<p>Originally answered here: <strong>https://qr.ae/pNZrHN</strong></p>
<p><strong>Of course not. Not in a way humanity formalized and invented computers.</strong></p>
<p>The entire premise of AI is Computers being programmed to do tasks that are hard for them. Now that programming can be by humans (traditional AI, intelligent systems) or by Computers themselves (Machine Learning).</p>
<h3 id="q-should-doctors-be-replaced-by-artificial-intelligence-and-surgical-robots">Q. Should doctors be replaced by artificial intelligence and surgical robots?</h3>
<p>Originally answered here: https://qr.ae/pND8g7</p>
<p>I have written about this in many answers previously :</p>
<p><a href="https://www.quora.com/Whats-your-opinion-on-Elon-Musk-believes-AI-poses-a-threat-to-humanity-and-is-most-worried-by-Google-owned-DeepMind-project-Do-you-agree-with-this/answer/Muktabh-Mayank?ch=10&share=2617a7ed&srid=qie">Muktabh Mayank’s answer to What’s your opinion on Elon Musk believes AI poses a threat to humanity and is most worried by Google-owned DeepMind project? Do you agree with this?</a></p>
<p><a href="https://www.quora.com/As-a-result-of-the-Fourth-Industrial-Revolution-will-any-job-be-lost/answer/Muktabh-Mayank?ch=10&share=475d3603&srid=qie">Muktabh Mayank’s answer to As a result of the Fourth Industrial Revolution, will any job be lost?</a></p>
<p>Transitions are not sudden and there would be no “replacements”. Unlike a hollywood movie, a doctor won’t wake up one day and reach office to find out that an AI will now do what they used to do till one day back as a doctor. Doctors’ jobs will evolve to use AI is what will happen.</p>
<p>Will doctors be able to take care of more number of patients per doctore using AI ? Yes.</p>
<p>Will doctors have to use many AI gadgets in their practice in future ? Yes. Many AI tools will be incorporated into their workflow like stethoscope and XRays are today.</p>
<p>Will salaries change ? Yes. Its hard to predict what exactly happens but I think the effect will be some very rich doctors and others slightly worse off.</p>
<p>“Should Doctors be replaced ?” That is a question with a false premise that we have AI systems that can replace Doctors. We don’t and won’t have for foreseeable future.</p>
<h3 id="q-how-much-would-i-have-to-manage-to-hijack-a-facial-recognition-system">Q. How much would I have to manage to hijack a facial recognition system?</h3>
<p>Originally answered here: https://qr.ae/pNWORI</p>
<p>The foolproof way of hijaking is an armed invasion of the cloud center where the Face Recognition systems run.</p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image3.jpeg" alt="" /></p>
<p>Or basically some kind of social engineering based hacking to just delete your records and photos from the system forever.</p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image4.jpeg" alt="" /></p>
<p>But I guess, you are more interested that what can one do as a citizen to fool these systems as we cannot really stop these face ID systems by a large scale assault or hack. Following are ways to achieve that :</p>
<p>The simplest way is for everyone to just wear masks. Masks which hide face of wearer or have someone else’s face printed on them. However, that is a bit odd (outside the pandemic timeline of course!)</p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image5.jpeg" alt="" /></p>
<p>Another (less suspicious) method is use Adversarial attacks or Poisoning images to guard against Facial Recognition.</p>
<p><a href="_blank">Fawkes</a></p>
<p>is an open source and free tool you can use to poison your images before uploading to social media so that Facial Recognition systems find it hard to identify them.</p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image6.png" alt="" /></p>
<p>https://youtu.be/AWrI0EuYW6A</p>
<p>However, this is for fooling virtual world face recognition, how to fool the algorithms working in real world on CCTV feeds ?</p>
<p>There are hardware based adversarial attacks (These are adversarial patches created using other Deep Learning techniques) that can make Deep Learning Face Recognition systems go ineffective.</p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image7.png" alt="" /></p>
<p><a href="https://youtu.be/MIbFvK2S9g8">https://youtu.be/MIbFvK2S9g8</a></p>
<p>Paper Here: <a href="https://arxiv.org/pdf/1904.08653.pdf">https://arxiv.org/pdf/1904.08653.pdf</a></p>
<p>So yeah, maybe invest in buying one of these patches if you don’t want to be seen. This is not foolproof however and can fail many times.</p>
<h3 id="q-why-is-artificial-intelligence-so-power-intensive">Q. Why is artificial intelligence so power intensive?</h3>
<p>Originally answered here: https://qr.ae/pNzjGf</p>
<p>Anything ambitious is power hungry ! You want to learn some 100 billion numbers to memorize the whole of human knowledge ontology (GPT3 is a clever way to memorize wikipedia basically), you would need power to crunch it. Similarly looking at many billion images to figure out all possible objects from figuring out what is a cat and what a wing of a bird is to and what the shape of an aircraft is automatically will need number crunching ability (BYOL). I think this should not even be a question. Humanity’s energy budget has not changed by a big margin for sometime and rather grown steadily, but Deep Learning based advances are recent because of lack of hardware until 10 years back that can consume energy vigorously and crunch numbers fast for learning that would have taken years otherwise. (GPGPUs / TPUs / Graphcore etc). These new devices will keep getting more powerful and more efficient per compute cycle with time increasing our capacity to number crunch even more. The energy requirement will only grow up.</p>
<p>The question should rather be how to make energy cheap and eco-friendly so that we can do ambitious stuf. There is only so much energy one can produce without converting Earth into a gas chamber and burning the limited trees and dinosaur juice in Earth’s core.</p>
<p>If you want to have cheaper AI algorithms that improve life of humans, a particle accelerator that can solve mysteries of Physics or frequent air travel, we will need to adopt the energy sources which make energy essentially free for all humans. <a href="https://en.wikipedia.org/wiki/Kardashev_scale">Kardashev scale - Wikipedia</a></p>
<p>for a stage 1 civilization expects humans to capture most of Solar Energy coming to Earth using microwave emitting Sun satellite, inventing Fusion (not fission) nuclear reactor and antimatter based energy. This would enable humans to become a Level 1 civilization. I guess when so much energy will be available at our (human) discretion.</p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image8.jpeg" alt="" /></p>
<h3 id="q-can-artificial-intelligences-become-fully-aware-of-themselves-if-they-cannot-be-sentient-overcome-their-programming">Q. Can artificial intelligences become fully aware of themselves if they cannot be sentient (overcome their programming)?</h3>
<p>Originally answered here: https://qr.ae/pNcn9b</p>
<p>Unfortunately (actually fortunately), we are so far away from Sentient AI that we have no clue about how would it look like and how would it behave. Anyone who tells you that you can predict anything about sentient AI (or we are anywhere close to sentient AI) is just misinformed.</p>
<p>For example, one of the answers to this question itself picks up the example of Facebook AI that learned to communicate and needed to be shut down. That is plain fake news, fake news which mainstream media reported and it resulted in creation of all types of conspiracy theories. <a href="https://www.snopes.com/fact-check/facebook-ai-developed-own-language/">FACT CHECK: Did Facebook Shut Down an AI Experiment Because Chatbots Developed Their Own Language?</a></p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image9.png" alt="" /></p>
<p>Think of it, well known news outlet, some of which you actually swear on and present as proof in your online debates, put out a fake news. This has started a trend where charlatans can shine as “AI leaders” by talking about sentient AI as if they were an expert in the field. The truth is no one knows (specially these charlatans don’t know) how sentient AI will look like in future. Its all woozle effect and fiction.</p>
<p>The only intelligence we know about (in fact we don’t know about it a lot) is human intelligence and we know that humans were sentient long before they understood their programming. (We have not understood our DNA fully yet). I don’t think this can be extrapolated to machines as humans are the ones building AI and they might want to address the defects they have. But yeah, as I said, we are decades if not a century away from such decisions and thoughts as of now, so its very hard to speculate anything.</p>
<h3 id="q-if-a-machine-reaches-hlmi-human-level-machine-intelligence-will-it-already-outperform-humans-since-the-average-speed-of-a-signal-transfer-inside-a-microprocessor-is-about-67-the-speed-of-light-whereas-that-of-out-brain-cells-is-120ms">Q. If a machine reaches HLMI (Human Level Machine Intelligence) will it already outperform humans since the average speed of a signal transfer inside a microprocessor is about 67% the speed of light. whereas that of out brain cells is 120m/s?</h3>
<p>Originally answered here : <a href="https://qr.ae/pNWgkS">https://qr.ae/pNWgkS</a></p>
<p>Not necessarily.</p>
<p>Human Brain actually is much much more efficient than the hardware we have today despite the signal speed being low. You cannot put a jet engine on a 1970s model car and think it can defeat a 2020 Tesla Model S. In an Information Processing system (in fact any system) the system is as fast as the slowest component, the weakest link. Your Computer’s CPU is much faster than its memory and way faster than the harddisk, and for most tasks you do on your computer you are limited by the speed of the hard disk despite having a very fast CPU. Basically as of today, the least optimized component of human brains will be better than the least optimized component of the compute systems.</p>
<p>Now we don’t know if we will have hardware as efficient as human brain in all aspect to predict whether HLMI will be better than humans already. So as of today, the answer is, “we don’t know”.</p>
<h3 id="q-could-we-theoretically-build-an-ai-that-could-build-another-ai-more-intelligent-than-itself-and-thus-continue-the-cycle-are-there-any-limitations-to-this">Q. Could we theoretically build an AI that could build another AI more intelligent than itself, and thus continue the cycle? Are there any limitations to this?</h3>
<p>Originally answered here : https://qr.ae/pNzjtQ</p>
<p>Theoretically Yes. That is the point of “intelligence singularity” : <a href="https://en.wikipedia.org/wiki/Technological_singularity">Technological singularity - Wikipedia</a>. An intelligence which can efficiently make an intelligence better than itself recursively would trigger creation of far superior intelligence than humans in a very short time. We are very very far from having any hardware or software remotely capable of doing so, but I think its going to be somewhat like Ray Kurzweil predicts: <a href="_blank">The Singularity Is Near - Wikipedia</a></p>
<p>. The most efficient machines of planet (human bodies and brains) will be what possibly achieves this feat by implementing new technologies like ASI to enhance itself, so we will have transhumans, becoming smarter than before. “Running Tensorflow models on Human Brain” is the way to go you know :) .</p>
<p>Remember, all this is very theoretical and will maybe not even happen in 21st century (or ever) and so its not possible for us to imagine how things would look like then.</p>
<p>Here is how 19th century patents for what they imagined future to look like : <a href="https://www.theguardian.com/technology/gallery/2015/may/14/imagining-the-future-turn-of-the-century-us-patents-in-pictures">Imagining the future: early 20th century US patents - in pictures</a></p>
<p>. A lot of it was never even invented and air travel and submarine is far from what they think :</p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image10.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2021-01-26-Talking-about-AI-hypotheticals/media/image11.jpeg" alt="" /></p>
<p>You can expect the future to have some trends in line with what we think today, but the details might be very different from what we can imagine.</p>
<h3 id="q-how-is-deep-learning-not-the-future-of-artificial-intelligence">Q. How is deep learning not the future of artificial intelligence?</h3>
<p><a href="">https://www.quora.com/How-is-deep-learning-not-the-future-of-artificial-intelligence?top_ans=280928643</a></p>
<p>Humans attach emotional responses to arbitrary ontologies. How can we think “Deep Learning” has a fixed definition or “future of AI” means something quantitative.</p>
<p>How do we know Deep Learning will not evolve and will stay the way it is ? Both in terms of Hardware efficiency and Learning methodology , Deep Learning 5 10 years might be very different and scale very differently from what it is today. No one would have imagined GPT3 or CLIP or new awesome Deepfake results in 2012 when I started working on it. How do we know we wont invent better hardware to perform the current learning algorithms much more efficiently or invent new learning algorithms to make Deep Learning work at super scale ? We may invent something, we may not. Deep Learning methods might give us an AGI all on their own or they might become like SVM, once a hyped technology but hardly used today. No way to know.</p>
<p>Will the Final AGI <a href="https://en.wikipedia.org/wiki/Artificial_general_intelligence">https://en.wikipedia.org/wiki/Artificial_general_intelligence</a> <a href="">have Deep Neural Networks as its component ? We dont know, we cannot even guess. It may, It may not. Its just so far ahead in future that humans with their current knowledge cannot imagine it.</a></p>
<p>Will Deep Learning find commercial applications in near future ? Yes. You can be sure about it.</p>
<p>In my opinion, the right way is to start using Deep Learning to the advantage of human race in its current ability and stop thinking of abstract concepts like “future of artificial intelligence” which we can in no way imagine given our current knowledge. Some questions just don’t have an epistemic answer.</p>
<h3 id="q-is-ai-an-existential-threat-to-humanity">Q. Is AI an existential threat to humanity?</h3>
<p><a href="">https://qr.ae/pGvtz5</a></p>
<p>No ! We are just too influenced by Hollywood when we look at AI and fears around it.</p>
<p>Humanity is sturdier and smarter than what most of us think it to be. Simple local shocks like a small nuclear accident or a AI drone going berserk and killing people are painful possible scenarios, but will not cause humanity to end. Humanity has very powerful tools [adaptability of human beings and their will to survive, very strong communication mechanism] which can essentially beat every threat apart from the following types :</p>
<ol>
<li>
<p>Risks which humanity continues to take [and doesn’t fear] despite knowing they are detrimental to it until its too late. Climate change falls in this category, we all know that it effects us and its happening, but we are still not doing enough. An example from past is 2008 financial crisis where financial companies in America continued giving rotten mortgages despite knowing may of these mortgages are bad.</p>
</li>
<li>
<p>Risks which can start and spread faster than humans dispel information. A risk like this was COVID19 [or think of another virus like CORONAVIRUS but which causes long term effects on humans], a zika virus which spreads like COVID if you will. Such a virus is a systemic risk and needs to be handled at very small level, possibly before it starts, otherwise it would essentially cripple humanity. Thanos’s deadly finger snap is another example of such a risk, before humans could understand anything, half of the population was gone ! A nuclear war between US and Russia would set off a similar chain of dangers which couldn’t be possibly stopped by humanity.</p>
</li>
</ol>
<p>Contrast AI or Nuclear Energy or CRISPR technology to both the types of doomsday scenarios. They are surely not type 1. Common Sense already alerts humans about their negatives. We have evolved for billions of years to sense quickly emerging danger. We would never for example do a CRISPR experiment on entire human race without lot of trials [goes for mRNA vaccines too]. We will never install too many nuclear stations which blowing up are interdependent on each other and we will never put an AI which can potentially harm us in charge without an emergency STOP button:</p>
<p><a href="">https://www.quora.com/How-do-we-fight-with-machines-if-ever-war-occurs/answer/Muktabh-Mayank</a></p>
<p>We are too aware about AI risks for it to become an existential threat unlike climate change.</p>
<p>There might be a few incidents of self driving cars potentially killing passengers, an army drone shooting innocent people or an AI robot rebelling against their master and some of these might have painful consequences, but they will not harm humanity. News of isolated incidents spreading like fire and making rest of humanity alert is one of our biggest superpowers.</p>
<p>Earthquakes, Tsunamis and Volcanos fall in the same category of risks as one rogue AI. They are painful consequences to some of these local incidents but humanity emerges stronger on the other side.</p>
<p>As of today, our AI research is far from making an AGI : <a href="">https://en.wikipedia.org/wiki/Artificial_general_intelligence</a></p>
<p><em>[decades or maybe centuries away maybe]</em> and it is far from becoming in charge. Most “dangers” of AI today are like dangers from other disruptions, a new elite emerging, some people becoming suddenly very important/powerful. The closest analog from history to this is Mongols’ cavalry warfare, Spain’s advantage oover incas or gunpowder.</p>
<p><a href="">https://en.wikipedia.org/wiki/Gunpowder_empires</a></p>
<p>Calling AI in today’s scenario as risk is just too far away from truth. There are some people who like the current status quo a lot and are afraid of losing it, that’s not risk, its aversion to change.</p>
<h3 id="q-if-an-extremist-group-get-hold-of-an-artificial-intelligence-application-what-harm-can-they-inflict-on-the-world">Q. If an extremist group get hold of an artificial Intelligence application what harm can they inflict on the world?</h3>
<p><a href="">https://qr.ae/pG73vE</a></p>
<p>Not a lot ! Deploying AI [the type of AI systems we have right now and for a few decades IMO], requires very string reach and infrastructure. A simple AI system on its own is nothing.</p>
<p>For example, if I am a terrorist have an AI system which can recognize every person in the world [that system still doesn’t exist btw], I cannot do anything substantial with it until I get an access to all of world’s CCTVs cameras on whose feed you need to run the AI system to get any insight if any. Having an advanced AI system AND perpetual access to all CCTV cameras for a terrorist is a zero probability event.</p>
<p>I as a terrorist can have an AI system to generate fake news articles, but how to surface those articles in the TBs of information and make them viral to cause any disruption without platforms blocking me and counter-ops making people aware about the fake claims in my article ? Its very hard.</p>
<p>As of now, we are far away from any AI doomsday scenario. It will require a much more interconnected and automated world than today for AI to be a possible danger.</p>
<h3 id="q-movies-like-ex-machina-shows-scientist-are-working-in-isolated-location-to-create-a-human-artificial-intelligence-does-these-kind-of-scenarios-takes-place-in-real-world-what-do-u-think">Q. Movies like ex machina shows scientist are working in isolated location to create a human artificial intelligence. Does these kind of scenarios takes place in real world? What do u think?</h3>
<p><a href="">https://qr.ae/pGXEun</a></p>
<p>That is not really possible. One scientist working in isolation and creating Artificial General Intelligence is a good movie story, but is not how the research world works. Unlike what we humans think [and want], a single human can only achieve as much !</p>
<p>Research is collaborative, [sometimes boring] slow-yielding, compounding of mini-innovations introduced over time. Small mini-innovations slowly accumulate over time to become something noticeable. People from outside the field view it as magic many times because they don’t see the mini-innovations, but rather a compounded application of these innovations good enough for real world usage all of a sudden.</p>
<p>Here I try to describe how the current high accuracy by Deep Learning architectures slowly developed :</p>
<p><a href="">https://www.quora.com/Are-neural-net-architectures-accidental-discoveries/answer/Muktabh-Mayank</a></p>
<p>Deep Learning, the most promising technique as of now, has been used to make specialized AI and not a AGI [ <a href="https://en.wikipedia.org/wiki/Artificial_general_intelligence">https://en.wikipedia.org/wiki/Artificial_general_intelligence</a> <a href="">]</a> yet and IMO the day is still far when we will have something remotely like ex-machina.</p>Some thoughts around Artificial Intelligence hypotheticals. Most answers would be around “we are decades if not centuries away from building Artificial General Intelligence”, but hope you find some interesting points.Thoughts On Contemporary Indian Society2020-12-31T00:00:00-06:002020-12-31T00:00:00-06:00https://muktabh.xyz/2020/12/31/Thoughts-on-contemporary-Indian-society<p>Collecting some answers summarizing my thoughts on contemporary Indian society and education system. Since I come from a lower middle class/middle class background, a lot of thoughts might be middle class specific.</p>
<h3 id="my-answer-to-is-new-generation-betterworse-than-the-old-generation-in-india"><strong>My answer to “Is new Generation better/worse than the old generation in India?”</strong></h3>
<p>Originally answered here: <a href="https://qr.ae/TmYmAQ">https://qr.ae/TmYmAQ</a></p>
<p>“New Generation is better/worse than the old generation in India ?” question should be asked taking another important fact into account “the new generation is better off than the old generation”.</p>
<p>You cannot really compare two generations as they had different circumstances. Also the new generation is where it is as an efforts of previous generation. Unlike western countries, where some people live a life separate from their previous generations, parents and grandparents support their progeny in India a lot more, giving them better circumstances.</p>
<p>A lot of smart entrepreneurs today could take the risk and jump into startups because their grand father avoided buying a scooter and cycled all his life so that they could save money for education of grand children, and they did not need to take an education loan. A lot of independent women today are making great progress because their mothers are still working at age of 70, looking after their children, helping them focus more on their rising career.</p>
<p>The generation after independence, the generations of socialist India and the generation during economic liberalization have all worked very hard to achieve the self-dependent , risk-taking generations of India today. It will be injustice to say that current generation is better than previous ones.</p>
<h3 id="my-answer-to-is-doing-higher-studies-like-an-msc-and-an-ma-worthless-in-india-nowadays">My answer to “Is doing higher studies like an MSc and an MA worthless in India nowadays?”</h3>
<p>Originally answered here: https://qr.ae/Tlp02M</p>
<p>“What is worth of a degree ?” is the question you mist ponder about before you answer the question “Is the degree worthless ?”.</p>
<p>The Indian education system is built on a false premise of “education should be easy” rather than the premise of “education should be easily available”. We started with the latter but moved slowly towards the former (because 1. Maybe hiring teachers for such syllabi is easier as you need low proficiency teacher to expand education 2. Maybe quick gratification of easy degrees makes people happy and they vote for the government that caused it). So our universities hire average talent so that they can educate students with cookie cutter methods. This makes getting degrees in India (not just MA MSc but even PhDs) really easy. Average practical knowledge of Indian degree holders is really low. Most people mug up answers from guides and other such stuff to clear exams and get degrees. Just a couple of days back I talked to an English MA whose English was really poor, probably all they did was mug up long paragraphs about Yeats and Shakespeare and got the degree, but the practical value was Zero. Because so many people get degree with so little proficiency in their fields, the overall value of degrees gets diluted.</p>
<p>A good approximation of “worth of degree” according to me is the amount of effort one has to put to get it. We all would know that for a lot of degrees, people need to study really less. The books are there, there is a lot to learn, but since people have low effort arbitrage to clear exams and get degrees, they dont really learn their subjects. These arbitrages like “reading for last years question papers” and “guides” and “key” books often even yield more marks than students who try to learn from books.</p>
<p>People thus just want to give exams, not learn the subjects :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image1.png" alt="" /></p>
<p>I think virtual classrooms on internet will slowly kill this vicious cycle of <strong>some bad people going into teaching -> creating arbitrage like learning exams just by last question paper preparation -> less student interaction -> Few people understanding the subject with respect to many people getting degrees-> more worse people getting into teaching</strong> as smarter individuals can teach 100s and 1000s of pupils using online learning tools.</p>
<p>A lot of people also confuse the “worth of degree” with “employability”. Many of my acquaintances just think, “I can obtain X degree, I will be able to earn Y Rupees per Month in a job at Z company”. Degrees are a proof of “completion of coursework” and not “employability”, they are correlated concepts to some extent but not same. As our low tech and/or socialist institutions are getting competition, degrees will slowly become less important and personal capacity more important. While public systems are not good at filtering out talent that well and uses proxies like universities, a free market will slowly allow for removal of this inefficiency and things will start depending upon personal capacity in future.</p>
<p>So TL,DR:</p>
<ol>
<li>
<blockquote>
<p>Many degrees are worthless in India as a lot of people holding them know how to pass exams for getting that degree rather than knowing about the subjects well in which they get degree. They drag the minority people with them who so know the subject well, but their degree carries no weight.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>There is arbitrage where you can focus on passing the exams rather than actually going and learning with teachers and peers. So people just want to interact with teachers who are really good at their subjects (India has a really low threshold at becoming a teacher).</p>
</blockquote>
</li>
<li>
<blockquote>
<p>People often confuse degree with employability. These are two different things. If you try to become employable, a degree might be a good step, but not the only step.</p>
</blockquote>
<ol>
<li>
<h3 id="my-answer-to-what-is-your-view-on-union-minister-santosh-gangwars-statement-that-north-indians-are-unemployed-because-they-dont-have-skills">My answer to “What is your view on Union Minister Santosh Gangwar’s statement that North Indians are unemployed because they don’t have skills?”</h3>
</li>
</ol>
</li>
</ol>
<p>Originally Answered here: <a href="https://qr.ae/pNnZhu">https://qr.ae/pNnZhu</a></p>
<p>Let’s try and understand that “skills” != ”potential”. Potential is what we are born with, skills is what we acquire during our life and depends upon both institution and life philosophy of the individual. I understand that media and politicians will create a lot of noise over this, but the truth is that India has a skill:potential problem. We have not been able to utilize the full potential of our people.</p>
<p>The following is what are the issues:</p>
<ol>
<li>
<blockquote>
<p><strong>Making life simple has been confused with making qualifications simple:</strong> Life was hard during British and Mughal times. People were persecuted and the economy was falling. As a result, after Independence we elected Socialist governments who were concerned a lot about making the lives easier. However, this was mixed with making “qualifications” easy too. It was hard for people earlier to get access to formal education, but to solve it we along with coming up with access to education, we also came up with “easy education” to make life really simple. The current administration in UP was criticized by opposition parties as it did not allow rampant cheating during exams !! <a href="https://theprint.in/india/governance/yogi-govt-cracks-down-hard-on-cheating-in-board-exams/35637/">A million students in UP have dropped out of board exams because they couldn’t cheat</a>. Syllabus in schools is not easy or restrictive, but its plagued by cheating, repeated question papers (which effectively needs you to focus on previous years’ question papers than your lessons to score), poor infrastructure and bad teachers (think of it, the teachers came out of the same system). Think of it, previous government promoted 200,000 under qualified “teacher-helpers” as “teachers” and when the court canceled it, there is a massive protest going on. <a href="https://www.jagran.com/news/national-supreme-court-dismisses-curative-petition-of-up-shiksha-mitra-19480731.html">यूपी के शिक्षा मित्रों को सुप्रीम कोर्ट से बड़ा झटका, जानिए- क्या है मामला</a> (Sorry English media has no time covering this). You really think with such discussion in common parley, we are really worrying about skills ?<br />
You will be not be off-the-mark if you think similar things are going on in many universities too. For some universities, government keeps a check on quality, but look at the sheer numbers in the state. So think of it, for years and years, people have received qualifications without having to work for it. Its a needle-in-a-haystack problem recruiting in such a scenario. People have not exploited their potential for years and that makes a lot of difference.</p>
</blockquote>
</li>
<li>
<blockquote>
<p><strong>Higher Education system is slow to catch up, we teach irrelevant things:</strong> There is no question about the fact that our education syllabus till school is hard (you can cheat, the questions papers are repeated so that you can rote-memorize), but the syllabus is at least still thorough. This goes completely bonkers at university levels. Almost NO university graduates are job ready. We are still giving away 1000s of substandard PhDs on Shakespeare in a country where the maximum utility of English at max is to watch NetFlix and there is a resistance when the government tries to increase total numbers of Doctors getting into economy every year. In Engineering, its as stupid too. The total number of Aerospace Engineers graduating per year in India will be more than the total world demand of 10 years I guess. Same with Electronic Engineers, Marine Engineers, Agricultural Engineers etc. People are literally wasting their time studying degrees that practically have no research or employment value. They then join work force as trainee Business Developers, Software Engineers and Data Analysts. What’s the point of wasting 4 years like this ? Teachers, Professors and Administrators refuse to come out of their comfort-zones, and our youth is trapped. Parents frantically spending money unknowingly with no studies in economics making them understand what is good for them and their kids. Its a mess if you ask me and works only because India was busy solving third world problems at low salaries for a very long time.</p>
</blockquote>
</li>
</ol>
<p>There is no question that tougher to qualify education has had its problems, but most countries in Asia who have done well have gone that way: China, South Korea etc. and their skill:potential ratio is slightly better.</p>
<p><a href="https://www.weforum.org/agenda/2018/11/south-korea-has-come-to-a-standstill-for-exams/">Why South Korea falls silent once a year for its students</a></p>
<p><a href="https://www.businessinsider.in/The-gaokao-is-Chinas-notoriously-tough-entrance-exam-that-can-also-get-you-into-western-universities-check-out-its-punishing-questions/articleshow/64804367.cms">The gaokao is China’s notoriously tough entrance exam, that can also get you into western universities - check out its punishing questions</a></p>
<p>At college level, parents and students need to made more aware (I don’t know how) so that they are reading something that has good prospects. Probably better employment data should be made available. Probably something <a href="https://www.msde.gov.in/nationalskillmission.html">https://www.msde.gov.in/nationalskillmission.html</a> should take up.</p>
<h3 id="my-answer-to-how-backward-are-the-people-of-india">My Answer to “How backward are the people of India?”</h3>
<p>Answer originally was written here:</p>
<p><a href="https://qr.ae/TBK5pq">https://qr.ae/TBK5pq</a></p>
<p>How do you define backward ? Who defines backward ?</p>
<p>In India, common parlance uses the term “backward” when some aspect of life is not compliant with western or outside values. What it should actually mean is compliance with scientific values. A lot of Indians fail to differentiate between “scientific” and “western”, and thus they might feel other Indians are “backward” when they don’t comply 100% with western standards.</p>
<p>When I think of it “scientifically”, Indians aren’t more “backward” (non-compliant) than any other culture, in fact I feel they are quite accepting towards science.</p>
<p>Some examples:</p>
<p>A. Most education is science driven. There is no political standing (neither in right wing or left wing) to push for a non-scientific education. In contrast, you can look at the avoidance of evolution in some parts of US and all of Pakistan.</p>
<p>B. Traditions which were detrimental according to science have been abolished. Most people oppose detrimental customs like Sati, menstrual quarantine and majority of people will not accept caste based or linguistic discrimination in current times (at least publicly). There are a couple of assholes in every country, but the general populace is far from any of these bad practices.</p>
<p>C. We have built a true Republic. Our President is from the most backward caste and PM Modi is from backward caste too. Both of them come from extremely average families. In past, we have had women and minorities as both head of state and head of government. I mean how often have you seen a non - OxBridge PM in the UK or non-rich white protestant President in the US ? And the biggest thing, we put these people in power because they deserved it, not just for brownie points.</p>
<p>D. Social Mobility in India is still way better than many other countries, where social mobility has been compromised by the counter argument of welfare state. We have learnt our lessons from the past and learnt the supply-demand lessons in economics.</p>
<p>If you find India backward because of any of the following things, you do not really want India to be a scientific sane nation, but something totally else:</p>
<ol>
<li>
<blockquote>
<p><strong>Culture:</strong> I think Indians are quite non-traditional and let science take control wherever there is a contradiction. But if you think pushing them to get rid of their entire culture is the right thing because it is a “backward” culture, you are not “forward”, you are just opinionated. For example if offering God milk is backward, so is religious practice for all other religions. These practices are hurting no one and hence should not be anyone’s business. Every civilization which is not just 300 years old has its own culture. You can have opinion about moving on from all these old cultural practices, it doesn’t mean the cultures are backward.</p>
</blockquote>
</li>
<li>
<blockquote>
<p><strong>Religion:</strong> Hinduism is an old religion. A lot of things in scriptures cannot be judged by present day’s moral compass. That is true for all religions of the world BTW. If you disrespect Hinduism, expect Hindus to stop following it, while accept other religions as personal affairs of their followers, that is just hypocritical. No one is backward for following a religion if they take teachings from the religion in a pragmatic way in accordance to ongoing times.</p>
</blockquote>
</li>
<li>
<blockquote>
<p><strong>Concept of family:</strong> If you think living in traditional families and making sacrifices for one another is old fashioned, you are not forward, but actually stupid. There is a good consensus even in the west that fragmented families are not the best thing for children. Hedonism is selfish and although we don’t need tight societies like when we had as hunter gatherers, we have evolved to live in them and things might go wrong if we live YOLO all the time. <a href="https://www.theatlantic.com/magazine/archive/2020/03/the-nuclear-family-was-a-mistake/605536/">The Nuclear Family Was a Mistake</a> / <a href="https://www.city-journal.org/decline-of-family-loneliness-epidemic">Alone</a></p>
</blockquote>
</li>
<li>
<blockquote>
<p><strong>Alcohol/Smoking:</strong> A lot of people actually consider others backward if they don’t partake. I think being backward is better in these aspects. Alcohol and Smoking are proven to ruin quality of life and life expectancy. Its just stupid to assume you are ahead of the world if you drink/smoke like there is no tomorrow.</p>
</blockquote>
<ol>
<li>
<h3 id="my-answer-to-is-india-becoming-more-conservative-">My answer to “Is India becoming more conservative ?”</h3>
</li>
</ol>
</li>
</ol>
<p>Originally answered here: https://qr.ae/TJIFuT</p>
<p>What do you mean by conservative ?</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image2.png" alt="" /></p>
<p>Do you mean</p>
<p>definition 1 : “A person who is averse to change and hold traditional values ?” or</p>
<p>definition 2: “Favoring free enterprise, private ownership and socially conservative ideas”</p>
<p>I hope you are not talking about definition 2 as there is no real politics like US Republicans or UK’s Conservatives in India.</p>
<p>As far as “Averse to change and hold traditional values” is concerned, I don’t really think that is true. I would say that Indians behave quite scientifically as compared to many other parts of the world. Both left-of-center and right-of-center parties agree on a lot of scientific advancements and achievements the country needs.</p>
<p>Here is a list of things you will almost never see in India despite of a 1 Billion population which are very common in Western Countries. As an Indian, you will find them as non-issues where you agree with what science says, but they are a big deal in western society, which most Indians feel are hallmarks of liberalism:</p>
<p><strong>There is no sizable Anti Vaxxer Movement:</strong></p>
<p>While in the west, many people choose not to get their kids vaccinated as they (without scientific evidence) think that getting vaccinations gets their children diseases. In India, governments officially organize large free vaccination drives and I have met very very few people that argue the fact that vaccination as a group is our best defence against diseases.</p>
<p><a href="https://www.livescience.com/anti-vaxxers-try-to-change-name.html">‘Crazymothers’ Want You to Stop Calling Them ‘Anti-Vaxxers’</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image3.png" alt="" /></p>
<p><a href="https://www.globalcitizen.org/en/content/everything-you-need-to-know-about-the-anti-vaxxer/">Everything You Need to Know About the Anti-Vaxxer Movement</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image4.png" alt="" /></p>
<p><strong>No one disagrees about pollution and climate change:</strong></p>
<p>There is a unison in India’s political and social scene about human effects on the environment. You will seldom find leaders or common people disagreeing with climate change. Compare that to the west, where many many people hold the view that climate change is not surely caused by humans.</p>
<p><a href="https://skepticalscience.com/five-corrupt-pillars-climate-denial.html">https://skepticalscience.com/five-corrupt-pillars-climate-denial.html</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image5.png" alt="" /></p>
<p>Here is India’s supposedly right wing government focusing on tree plantation:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image6.png" alt="" /></p>
<p><strong>Very few disagree about Nuclear power:</strong></p>
<table>
<tbody>
<tr>
<td>Nuclear power has a bad reputation, which it doesn’t deserve. [Subscribe to read</td>
<td>Financial Times](https://www.ft.com/content/83122988-2b33-11ea-a126-99756bd8f45e)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image7.png" alt="" /></p>
<p>In general, Indians are not against Nuclear Power like what the westerners are. At worse, they don’t care, at best they like it. You can see our Youtube channels exploring why India’s Thorium reserves are good for it and people being proud of our Nuclear advancement.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image8.png" alt="" /></p>
<p>Video Link : https://youtu.be/M2X0klAjT7Q</p>
<p><strong>Abortion right is not really contested (at least in first trimester):</strong></p>
<p>This is not an issue at any level in India. Most people agree that its a right women have over their bodies. All that is advised here is to get things done under guidance of a trained medical professional. Look at the extremely charged opinion pieces from other countries:</p>
<p><a href="https://www.cnbc.com/2020/01/06/the-battle-over-abortion-rights-heres-whats-at-stake-in-2020.html">The battle over abortion rights: Here’s what’s at stake in 2020</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image9.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image10.png" alt="" /></p>
<p><strong>Scientific education is not contested</strong></p>
<p>Everyone and literally everyone in India agrees about exact science being taught in schools. No adulteration.</p>
<p>You will never see things like :</p>
<p><a href="https://www.theatlantic.com/education/archive/2019/09/schools-still-dont-teach-evolution/598312/">I Was Never Taught Where Humans Came From</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image11.png" alt="" /></p>
<p>Despite of this being from Atlantic, which is quite a political publication, you get the point. Here is what happens in our neighborhood, Pakistan :</p>
<p><a href="https://www.tandfonline.com/doi/abs/10.1080/00219266.2010.9656196">The origin and evolution of life in Pakistani High School Biology</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image12.png" alt="" /></p>
<p>In India, the problem is bad or absent staff in schools, or facilities being low, but never this.</p>
<p><strong>Discrimination practices are outlawed, like other democracies:</strong></p>
<p>There is no denying discrimination still exists in society, but they are losing ground slowly.</p>
<p><a href="https://paycheck.in/labour-law-india/fair-treatment">Fair Treatment at Workplace in India - Unfair Treatment at Work</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image13.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image14.png" alt="" /></p>
<p>So there are a couple of things over which you can call Indians conservative. say like, whether offering milk in their prayers is wastage of milk, or whether their one day festival of Holi/Diwali/Raksha Bandhan has scientific/social flaws, or how can these pagans worship a monkey God or Elephant God. Indians don’t do these things in lieu of scientific and altruistic work, but as an addendum, so it should not really be a concern. The truth is people who are pushing for calling Indians names over these are not really understanding that they are just fighting here for fighting’s sake rather than getting anything done. Rationalists in India are not really rationalists but communists who want religion gone. India is a religious country and doesn’t give into those thoughts. You can call India conservative for this.</p>
<h1 id="my-answer-to-why-doesnt-the-government-of-india-cancel-all-the-reservation-in-the-educational-institutions-and-government-jobs-and-other-sides-and-make-the-merit-based-like-other-countries">My answer to “Why doesn’t the government of India cancel all the reservation in the educational institutions and government jobs and other sides and make the merit based like other countries?”</h1>
<p>Originally answered here: https://qr.ae/pNKN1g</p>
<p>Whoa.. who said things are merit based in other countries ? Please just don’t criticize without understanding how the world works.</p>
<p>India is quite meritocratic in terms of education. Not any bad compared to other countries. Our college entrances and job entries are more much more based on objective merit/marks than subjective character/capability judgement. Think of a committee screening your applications to determine if you are a good “fit” to the institution/job you are entering. In India, even if such committees happen to be formed, are quite meritocratic (and more apolitical).</p>
<p>In many countries, there is a lot of time getting “fit” to enter college/universities requires either being a genius (which frankly most of us are not), being smart and aware (where the rich fare better than lower/middle class) or being from a background that the university deems its needs to create “diversity” (this is helping the poor, the counterpart to our reservation system). So the common way to go is to be smart and aware (of what universities want) sometimes involving to have a “great” CV with music, arts, literature and extra curriculars. Just scoring well in academics and entrance tests is not enough. The super rich kids can pay their way to create a CV and get into any college using their money (In India, you have meritocratic institutions where you can only enter after demonstration of extreme intelligence). Some surprising things from pov of an Indian can happen which you can never imagine in India, you can be dropped from admission into a university just because you are Asian and university already has admitted enough Asians, despite of seats still being vacant. I am talking about one of the places which you would be definitely thinking to be the most “meritocratic” in your mind.</p>
<p>There is no doubt that there are sections of Indian society that are behind the average Indian economically and socially. They don’t have the advantages of being “performance coached” for getting good marks like how richer people have. There is definitely some special conduit required for such weaker sections of society. If it is not so, people with access to better schools and better coaching institutes will actually end up taking all seats in all educational institutions. Unless we are able to ensure that all communities have access to same level of schooling (which we will never be able to do given richer people will always go to better schools with better teachers), we will have to give a bump to people who deserve but cannot be there due to the way the world works.</p>
<p>Good schooling and Performance Coaching over years can create a massive difference between two people of the same calliber at birth is what many of us fail to understand and why we sometimes resent the reservation system. The other complaint is elites using these processes. India has been tweaking its reservation system with things like “Creamy Layer” and “saubcategorization” among backward sections to make sure there is no elite formed which prevent the benefit reaching to families who have yet not gotten advantage.</p>
<p>Indian systems (public services/ education/ healthcare) have been built keeping Indian ecology and psych in mind and are being continuously tweaked. We don’t need to copy other systems, these should work as well. What we need to do is to grow the pie (economy) to remove the dog-eat-dog situation wherever it exists. (This dog-eat-dog situation causes remorse and questions like this due to feeling of injustice). What we need to make sure is that we build more educational institutions (IITs/ IIMs/ AIIMS), which we are already doing at a fast rate and make sure kids who come out can aspire to jobs better than public servants. A country where public servants are considered a “great” job is either communist (which no country now is) or not using its full potential.</p>
<h1 id="my-answer-to-where-should-the-indian-government-invest-more-money-defense-or-healthcare">My answer to “Where should the Indian government invest more money, defense or healthcare?”</h1>
<p>Originally answered here: https://qr.ae/pNKN1V</p>
<p>This question is really ignorant.</p>
<p>Do you really believe that the total spend in India on healthcare is less than the spend in defense ?</p>
<p>Total spend on defense is <70 Billion USD</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image15.png" alt="" /></p>
<p>Total spend on healthcare is 140 Billion USD (and around 400 Billion USD by 2022)</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image16.png" alt="" /></p>
<p>India already spends more on healthcare than defense ! The mode of spending is different and that’s what the people who ask such questions want to change.</p>
<p><strong>Now, who pays for healthcare ?</strong> We Indians pay from our pockets. The spend is decentralized and fractally local, optimized at family, village, city, state and nation level depending what is relevant. It is publicly funded for people who cannot afford private healthcare and private for those who want to spend to get good healthcare. There is not too much regulation and gatekeeping which keeps the costs lower than most other countries (not just developed ones). Its not perfect, but its functional and improving. With GDP per capita getting high, it will become good (even better than many other countries). We need to focus on increasing our per capita GDP more than changing our healthcare system is what I personally think.</p>
<p><strong>Who pays for defense ?</strong> We Indians pay from our pockets too. However, there is no way I can personally negotiate with MiG for their latest jets, so we pay the money to government as taxes which the government will then spend on buying defense equipment and paying our soldiers.</p>
<p><strong>You need to understand:</strong></p>
<p>Now of course our public hospitals should be run well and properly without corruption and red tape. And they should get the funding required to treat the poor. No one is against that. Probably, the governments will boost spending in healthcare a lot during/after COVID19 outbreak and that is justified. However, the people who ask this question are generally not looking for this. Making government spending comparable in healthcare and defense is something else altogether.</p>
<p>When people say increase spending on healthcare, they are not really saying that we are not spending enough, but rather government should become the sole negotiator (or more important than it is right now) in healthcare just like in defence.</p>
<p><strong>What will happen:</strong></p>
<p>It will be simple for government, they will <em>charge more tax</em> from citizens and basically start <em>utilizing the entire 140 Billion USD themselves</em> to negotiate on our behalf and providing us <em>free healthcare</em>.</p>
<p><strong>What you should know:</strong></p>
<p>Now this is not untried, countries like UK have NHS which does exactly this. We also have PMS at provincial level which are public funded free/subsidized healthcare systems. However, since the PMS services are optional (thus not enough tax is levied to pay for it), the government healthcare services are not as good as say UK. But then is UK NHS the best halthcare system in the world ? The US has a healthcare system somewhat like what we have in India (albeit with more regulation, centralization and gatekeeping) and it works fine too. The flaws of the US system are not related to its quality, but due to regulations and gatekeeping which makes costs high.</p>
<p>So basically when you are saying for a more spending on healthcare, you are effectively asking for a UK style healthcare system. Everyone paying higher taxes (thus things becoming costlier) to make sure everyone gets good healthcare is a political stance. NHS is like the richer cousin of our government healthcare system :</p>
<blockquote>
<p><a href="https://en.wikipedia.org/wiki/Criticism_of_the_National_Health_Service_\(England\)">Criticism of the National Health Service (England) - Wikipedia</a></p>
</blockquote>
<p>There are waiting lists, everyone has to pay higher taxes even if they dont want to visit government hospitals, there is lack of meritocracy amongst medical staff (you don’t get to choose the doctors that treat you many a times and hence good and bad doctors are are equal), there is wastage and scandals at the top level and so on.</p>
<h1 id="my-answer-to-why-are-indian-corporate-employees-finding-it-difficult-to-innovate">My answer to “Why are Indian corporate employees finding it difficult to innovate?”</h1>
<p>Originally answered here: <a href="https://qr.ae/pN2duL">https://qr.ae/pN2duL</a></p>
<p>The question “Why are Indian corporate employees finding it difficult to innovate ?”, has a simple answer, “Innovation is difficult, for everyone, not just Indians.”</p>
<p>And there are innovative Indians who do get things done like building Unicorn startups, sending satellites to Mars in 1/10 of the cost other people require, starting and maintaining most important open source projects which power innovation, running world’s largest internet companies and financial institutions. So no lack of innovation as such in Indian populace.</p>
<p>Judging “Corporate Employees for lack of innovation” will generally be stereotyping as many of them do innovate. But if you asking about a large number of people in bodyshops/offshoring firms, (which I agree do not innovate) the answer is that they were never expected to innovate. Innovation is not what many corporate and government organizations have in mind when they hire. Their goal is either to hire the cheapest person to do the job or figure out a bag of good enough people from which anyone can be arbitrarily chosen to make an office work. That creates incentive for an arbitrage causing the phenomenon you are complaining about. To understand the concept deeply, you will need to understand first that human attributes are not born just one day. They are either innate, that is acquired from birth or developed by long term conditioning. You cannot expect a person who has optimized one skill all their life to suddenly switch modes in their late 20s or early 30s. Environment and conditioning matter, a cricketer till 25 cannot become a swimming champ at 30.</p>
<blockquote>
<p>If the entire cred one needs to get selected in a bureaucratic office is cracking a specific exam, people hone all their lives to perfect their skills to score well in exams and not innovate. An IAS (top goverment service) aspirant has generally studied “safe” subjects like sociology and political science for years to get an arbitrage in the hard entrance exams which gives them immense power and prestige. Why do you expect them suddenly to innovate and suddenly start problems like Paul Graham would do one fine day ? They will take more and more safe bets, which is maybe OK for a developing 3rd world country India was till 10–20 years back. Thinking of it, till late 1990 the socialist economy of India actually strangled innovation by <a href="https://en.wikipedia.org/wiki/Licence_Raj">Licence Raj - Wikipedia</a></p>
</blockquote>
<p>and risk-free dealings. Even jobs which are required to innovate like Engineers were stuck in Red Tape. I pity the innovators in independent India who lived their working lives during this time either frustrated by the red tape and system or had to migrate to the US or EU to make sure they could do what they wanted. Post-1990s economy was slightly better but it wast the best. While we Indians always talk bad about our public sector, frankly, the private sector which emerged was not as different.</p>
<p>So when bodyshopping and offshoring became an industry in India in late 90s-early2000s, people working in these firms graduate in Computer Science or diploma in electrical engineering from universities without a working computer or electronic labs were paid way better than a scientist who had done research for all his life from India’s top institutes which had ecosystem and facilities around high technology research. All bodyshopping/offshoring industry needed was English speakers with better than average analytical capabilities. This set off a trend of cheap educational institutes who focused on quantity and not quality. Potential scientists became BPO operators because the job even though paid peanuts as compared to their western counterpart, was still better paying than a job requiring more “innovation”. While this trend is slowly drying away, there are people in our middle and upper management levels who have been “innovation”-less for so long that they now cannot really switch gears. Many training institutes and universities have teachers and mentors from the same generation. So you cannot just hope people who have lived under the rock for such a long time to suddenly all start innovating.</p>
<blockquote>
<p>However, during all this hardship, Indian innovation had always found a way : <a href="https://en.wikipedia.org/wiki/Jugaad">Jugaad - Wikipedia</a></p>
</blockquote>
<p>. That said, it was always shunned and people were never conditioned to use innovation at the right time and in the right way.</p>
<p><em>It might seem like I am complaining about our system and Indian thought process. That is not true. A lot of it was actually correct and risk free behavior and what risk modellers would have recommended.</em> Indians after 1000 years of foreign rule were really poor in 1947. One thing you need to understand is that innovation requires not just grit but also risk taking, The country was too poor to even feed itself in 1947 and our risk appetite would have been low. There was hardly room for innovation and I think taking a “safe” bet was the best way to make sure we survived then. Only in past few years has innovation become rewarding as we have reached a level in Marslow’s pyramid where we dont need to care about third world problems as much as a country. We have adapted to different situations and we need to do it now again, but luckily, this time we get to encourage innovation.</p>
<p>We owe it to our previous generations, who toiled in slavery and then boring stupid jobs to make enough money and brought us to a level we are at now, to finally innovate. Probably after many centuries, in post 2010 era, India is at a state where innovation is profitable and interesting. We need to grow like there is no tomorrow and its upon our current and upcoming generations to innovate and make it possible.</p>
<h3 id="my-answer-to-what-do-people-who-are-more-than-45-years-old-do-after-getting-fired-from-their-job-due-to-cost-cutting">My answer to “What do people who are more than 45 years old do after getting fired from their job due to cost cutting?”</h3>
<p>Originally answered here: https://qr.ae/pNaTcX</p>
<p>I hope most people don’t have to go through this ! I am sure there are problems that one would face after being fired at 45 and having nowhere to go, that at my age I wouldn’t be able to visualize. (I read some LinkedIn messages and it seems some people have been really badly effected during pandemic). I hope things turn around soon. Indian economy is showing some signs of recovery in both production and consumption and a vaccine now looks imminent. Its very easy for a third person like me to come and preach about what should be done and what shouldn’t be, but implementing and changing things in ones life is a whole different ballgame.</p>
<p>{As you can probably see, the answer is written from an Indian Perspective, you can even say Indian Middle class perspective} .</p>
<p><em>Frankly, there is not a lot an unprepared person can do at 45 years of age after being fired from their job. First, they should understand its not their fault, but sheer luck, there are worse people than them who faced no difficulties because they were lucky. They should just aggressively cut down on expenses and wait for economy to revive. That’s the only sure shot way ! Economy will be back on track after a few bad quarters of downturn at max, that’s the thing with neoliberal economies. Many people think cutting down expenses is not possible, they will need to think about their personal Maslow’s pyramid and move downwards temporarily.</em></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image17.png" alt="" /></p>
<p>This is going to be a more anecdotal article. An article I wrote on this based on more theoretical concepts also exists if you want to look at it using a few principles from Finance/Economics I know of here: <a href="https://www.quora.com/No-offense-I-see-a-lot-of-posts-on-LinkedIn-that-they-lost-job-due-to-covid-and-some-of-them-do-not-even-have-money-to-feed-their-families-2-meals-a-day-Some-of-these-posts-are-from-people-with-7-15-years-exp-Where/answer/Muktabh-Mayank">Muktabh Mayank’s answer to No offense. I see a lot of posts on LinkedIn that they lost job due to covid and some of them do not even have money to feed their families 2 meals a day. Some of these posts are from people with 7-15+ years exp. Where did they go wrong in planning?</a> .</p>
<p>What I feel is the limitation with most middle class Indian households (This is true for the city dwelling middle white collar middle class only, not businessmen. My family and my extended family and many friends/colleagues I know all of them follow this pattern.) is that while they have started to enjoy the benefits of high growth rates of a capitalist economy, they still live in the bubble of surety the Socialist Economy of pre-1991 (till 1991 of course, in 1991 it was all up in the air) provided.</p>
<p>They plan and invest supposing :</p>
<p>1. <strong>The growth rate of economy will be kind of constant :</strong> Pre 1991 generation or parents of Gen-X ers (ones who are close to 45 now) lived in socialist India. The growth rate was low but constant, salaries were low but safe, jobs were rare but ones that existed were based on credentials and were hence permanent. There was a scarcity of money middle class had to spend. Now there is high salaries and easy credit and people just go on spending overdrives assuming the current world is just a high growth version of pre-1990 middle class. One could not really know but in hindsight, I think Indian middle class spending habits will change for good post the pandemic disruption. I know a few people who literally live off their credit card, salaries going into EMIs and Debt.</p>
<p>2. <strong>Buy now or you will miss out later</strong> : Notice the conversations in real life. How much do you think is now driven by “spending”. Enjoying a holiday, buying a new house/car , new phone and stuff like that is what many people talk about even in their daily time period. Basically, for many people spending money is now the way : A. To appear smart/different, B. To take action and C. To blend in. All three are human biases, they want these things to happen. Once spending money is proxy for it, all they will aim for is to spend. Very common in Indian urban middle class. If one is using the best deal they could get to appear smart, all they will do is take the deal, even if they don’t want it. Resisting the nudge is hard.</p>
<p>3. <strong>Not thinking about long term implications when taking a responsibility</strong> : Buying a dog, taking new phone on EMI and a personal loan for a Vietnam tour might appear livable at the time one is taking them, because people tend to underestimate future commitments and overestimate earnings. Before taking a long term responsibility, planning is important, imagine how will things turn out to be in good case and bad case.</p>
<p>4. <strong>Thinking that reducing expenses is not possible</strong> : Points 1,2 and 3 (and a lot of what will come after this) are all pre-emptive. This is possibly the only thing that one who is already in middle of a job crisis can do. Analyze one’s expenses and cut them down as soon as they see any possibility of an economic downturn. A lot of expenses are not necessary, but people don’t tend to think of them as discretionary. It’s ok to not be able to celebrate one birthday or not able to buy a new phone every year or not paint your house if you objectively feel its not needed or is not possible. People have far bigger problems. Don’t think that this reduces your social standing in any way.</p>
<p>All four of them aren’t true. As a middle class person working in a capitalist economy during prosperity periods and making good money, one needs to remember :</p>
<p>A. One’s current skill will not always be as relevant.</p>
<p>B. The economy will go through boom and burst, don’t expect to earn the same even if one’s skills are perennial.</p>
<p>C. Apart from high growth investment, keep an emergency fund (preferably as gold/savings bank deposit), which you can retrieve and use during bad cycles of economy. All the SIP will be of no use if one loses job in a bad economy cycle.</p>
<p>D. Possibly diversify source of earnings. At least be employable in two skills. One skill can be a hobby when you are not on vocation. A Thailand trip in 2012 won’t be able to support you when you are out of job, a hobby (say like gardening) potentially could.</p>
<p>E. Resist the nudge to spend. Salespeople will suggest you to spend, Social Media influencers will suggest you to spend, Society will tell you so, your near and dear ones will tell you so, because when you spend they have fun, but spend your money wisely. Remember the same money you spent irresponsibly one day could be the one that supports you in bad times.</p>
<p>Long term stable jobs, Credit based Consumption, no downsizings and no emergency fund is not something that would hold in a capitalist economy. There will be booms and downturns and one needs to keep the last downturn in mind while managing finances.</p>
<h3 id="my-answer-to-no-offense-i-see-a-lot-of-posts-on-linkedin-that-they-lost-job-due-to-covid-and-some-of-them-do-not-even-have-money-to-feed-their-families-2-meals-a-day-some-of-these-posts-are-from-people-with-7-15-years-exp-where-did-they-go-wrong-in-planning-written-during-2020-pandemic-disruption">My answer to “No offense. I see a lot of posts on LinkedIn that they lost job due to covid and some of them do not even have money to feed their families 2 meals a day. Some of these posts are from people with 7-15+ years exp. Where did they go wrong in planning?”. Written during 2020 pandemic disruption.</h3>
<p>This is an extremely sensitive point and I must say that we should not paint everyone with the same brush.</p>
<p>Some people out of these might just be having a bad phase of luck. There might be many other pre-existing situations like loss of an earning member of household, health issues, accidents etc due to which these people would already have been financially venerable even before the pandemic disruption and then on losing their job, they would have had to face an economic crisis. There are times people get the shorter end of stick by nature and I don’t think they could have helped it. Really sorry for such brave people.</p>
<p>However, a genuine question comes up for people who were not in any distress, were living a happy, content and economically balanced life before the pandemic, suddenly losing jobs and then not having enough money to even feed their family. Where did they go wrong ? One of the common reasons is poorly estimating one’s risk appetite and not being prepared for an uncle point. Let’s understand this financial situation from point of view of people who deal with loss, gain and ruins on everyday basis, stock traders :</p>
<p>First of all people who lost their jobs were unlucky. People who are watching this crisis as outsiders from safety of their home and job should count our blessings. Some businesses started doing worse, some just outright tanked while a few of them actually grew when the disruption hit. At least in India, people have relatively less control over which sector they get a job in due to and they could have never predicted whether a pandemic would effect their job. So, at least here you can say that just like any other emergency situation (war/earthquake/volcano/cyclone/share markets), pandemic has its share of losers and winners (basically the people who lose less!). A lot of people were just lucky to be in a place which didn’t get effected by pandemic disruption and survived despite having habits worse than those who are in doldrums. That said, not everyone who lost their job is in total distress and posting appeal for help on LinkedIn. Why so ? Because some people were better at understanding their personal risk profile. It’s basically the same set of rules you use to deal with <a href="https://www.mypivots.com/dictionary/definition/416/uncle-point">Uncle Point</a> in finance. The first thing to understand is one cannot prevent or avoid uncle points, one can at best be prepared.</p>
<ul>
<li>
<blockquote>
<p>The first basic thing is having an emergency fund. Even if one does nothing, no fancy thinking, but has an emergency fund, they would at least survive. Every person should have 3–6 months of expenses in their savings bank account at any time under any circumstances. 3–6 months of good times’ expenses lasts way longer in a crisis when one is willing to change habits. If one doesn’t have it, they are sure to go in distress in any out-of-ordinary situation, not just pandemic disruption. Always maintain an emergency fund ! Chuck a few iPhones and Bose headphones and make sure this fund exists. <a href="https://www.nerdwallet.com/article/banking/savings/emergency-fund-why-it-matters">Emergency Fund: What It Is and Why It Matters - NerdWallet</a>. Points henceforth are not something most people can follow, but this is an absolute minimum must.</p>
</blockquote>
</li>
</ul>
<!-- end list -->
<ul>
<li>
<blockquote>
<p>The second thing is overestimating ones risk profile and buying useless stuff. One must remember that everyone who buys an expensive car has different usage, someone might be using it to make a good impression to crack business deals while the other might be buying it to show to the world they can afford it. The latter really has no financial upsides and is a emotional but financially loss making decision. You can call it emotional purchase. Its not just here, people purchase emotionally all the time. They buy things that they wont ever use or costlier variant of things with features they wont use. They will buy a 8 GB variant over 6 GB phone without thinking if they will get any advantage in their life. Now, its completely ok if one is making a emotional buying decision if it is something well within their risk appetite. You can anytime take a 1 rupee loss if you have say 500 rupees, but not if you have 2 rupees. Risks like 1 rupee emotional purchase if you have 2 rupees has an assumption that there will be no other risks at all. This is what most people miscalculate, they assume that the world will go on as normal. One becomes more susceptible to uncle points if one takes loss making decisions like these. Salespeople know how to make you take an emotional (maybe loss making) decision, look at some examples here : <a href="https://zoovu.com/blog/8-emotional-states-that-influence-purchase-decisions/">8 Emotional States That Influence Purchase Decisions</a>. Do check these points to see if you are making an emotional decision.</p>
</blockquote>
</li>
</ul>
<!-- end list -->
<ul>
<li>
<blockquote>
<p>Most people have some 6th sense about their spending limits, so they are able to avoid one heavy emotional purchase. But many of these people fall for “bleeding by 1000 cuts”. Taking a risk like a small emotional buy once in a while has very low probability of ruin, but repeated and many exposures (making loss making decisions repeatably/in-parallel) again makes one very susceptible to uncle point. Somewhat like visiting Chernobyl, going there for an hour today will most likely not cause any harm but staying there for a long time is a different issue. Easy credit availibility makes people forget that they might not be having enough resources to afford something. The subjects in study <a href="https://www.jstor.org/stable/2488726?seq=1">Differences in Consumer Purchase Behavior by Credit Card Payment System on JSTOR</a> showed people spent spend more when they have a store issued credit card. People slowly bleed money in such cases they could have saved in an emergency fund or just saved. This slowly compunds. Hedonistic lifestyles which show that status is achieved through better gadgets, clothes, holidays, instagram photos and cars actually pushes people into making many small emotional decisions. We dont live to enjoy, we enjoy so that we can live !</p>
</blockquote>
</li>
</ul>
<!-- end list -->
<ul>
<li>
<blockquote>
<p>Finally, lack of hedging. One needs to hedge against a uncle point. A hedge makes sure that in case of poor luck, you are not totally ruined. Naval Ravikant explains hedge for salaried people as : <a href="https://nav.al/salary-freedom">Live Below Your Means for Freedom</a>. The game is to as quickly as possible, save money and invest into things that will continue to earn for you while you are on a holiday, unemployed or unwell. One should try to make money from alternative sources which don’t depend on one’s health or employment or ability to enhance skills.</p>
</blockquote>
</li>
</ul>
<p>All this said, do remember that luck is very important. There are things that can cause absolute damage and one can be smart and still cannot escape uncle points. One should try empathizing with people whose luck was not as good as yours and helping if possible.</p>
<blockquote>
<p>Also, if you believe in simple answers like “rich are lazy, so people suffer”, “people are lazy so they suffer” or things like that, you are just thinking wrongly and should think about <a href="https://en.wikipedia.org/wiki/Survivorship_bias">Survivorship bias - Wikipedia</a>. Media only shows rich people who made it, not the ones who lost millions/billions and lazy people not doing their job, not the ones who work hard day-to-day.</p>
</blockquote>
<h3 id="my-answer-to-is-it-true-that-the-iits-are-indeed-the-best-tech-schools-in-all-of-asia-if-so-then-shouldnt-india-be-the-top-nation-in-all-of-asia-for-technology-development-why-then-does-so-much-tech-seem-to-be-developed-in-japan-s-korea-china-etc">My answer to “Is it true that the IIT’s are indeed the best tech schools in all of Asia? If so, then shouldn’t India be the top nation in all of Asia for technology development? Why then does so much tech seem to be developed in Japan, S Korea, China, etc.?”</h3>
<p>Originally answered here : https://qr.ae/pNzQw4</p>
<p>IITs are not the best tech schools. But they are the hardest to get in. Not just in India or Asia, but possibly the world. The value IITs get is because they can assimilate such smart people within a few hectares through their very meritocratic yearly competition. They are possibly areas with highest average intelligence in the world.</p>
<p>In my view, innovation comes from outliers {smartest amongst the smart} and not necessarily a group of people who are more smart than the average. However, its also very high probability that outliers will come from among the smart people. 10,000 hours of practice rule applies when you want to become an outlier from just plain “smart”. Most IITians by the time they become an outlier are already graduates and have left the college.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image18.png" alt="" /></p>
<p>That is the reason why I guess many high achievers are IITians, but very few of them become high achievers while in IIT. The key to make innovation happen at IITs is to create an ecosystem by which super smart people who join the college continue to work in the college with research work, this would enable IITs to actually capitalize on the high numbers of outliers that come out their high density of smart people.</p>
<p>I know some IIT professors who are really cool and meritocratic, but most Indian academia is still stuck in the feudal, credential based system of British times. If credentialism and feudalism is high, most “doers” get fed up. The faculty is underwhelming and its not due to their faculty that IITians are winning, but by socialization of smart people. I will quote Naval Ravikant here :</p>
<blockquote>
<p><a href="https://www.navalmanack.com/secret-sections/education">EDUCATION — Almanack of Naval Ravikant</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image19.png" alt="" /></p>
<p>IITs as I said earlier, get you the smartest possible peers on an average in the world. That is why IITians are succesful and IITs hardly are !</p>
<h3 id="my-answer-to-why-do-indian-residents-become-so-happy-when-any-indian-origin-people-reach-at-higher-position-in-the-world-even-heshe-never-mention-himself-as-a-proud-of-india-and-they-never-try-to-do-efforts-for-indias-development-by-their-services">My answer to “Why do Indian residents become so happy, when any Indian origin people reach at higher position in the World, even he/she never mention himself as a proud of India and they never try to do efforts for India’s Development by their services?”</h3>
<p>Originally answered here : <a href="">https://qr.ae/pND85w</a></p>
<p>I think you are asking the wrong question and I think I can make a guess about the actual issue you are talking about. The question should not be “Why successful people abroad are not proud of their Indian roots ?” or “Why are Indians so happy for them ?”, but rather “Why successful people who are attached to India not as famous in India than ones who made it big abroad ?”. TL, DR: Chill ! We are moving in right direction, we will soon have our own local heroes too.</p>
<p>Feeling inspired from someone who is doing good is natural in humans. It gives you confidence that if someone like you made it, you can make it too.</p>
<p>As an entrepreneur, I am a Elon Musk fanboy [sometime a bit over the top] and a fan of many other successful entrepreneurs [Sridhar Vembu, Dhirubhai Ambani, Sachin Bansal, Walchand Hirachand and Verghese Kurien in India] and feel inspired by their hardwork.</p>
<p>I am pretty sure there are Indian management students who find Sundar Pichai or Satya Nadella or Yogesh Deveshwar inspiring. Satya Nadella or Sundar Pichai or Yogesh Deveshwar have taken the path many Indians take [goto an Engineering college, join a company, work hard to get to top and create revolutionary policies for your employer] and reached the highest levels in their field of work [get promoted to the CEO of a multi-Billion dollar corporation is possibly the best someone trying to go up a corporate ladder can achieve].</p>
<p>It’s ok to feel inspired ! There is no point in criticizing this feeling.</p>
<p>However, I probably understand what you are trying to ask. You want to ask why is Yogesh Deveshwar and Sridhar Vembu less famous in India than Sundar Pichai or Sabir Bhatia say. BTW, if you don’t know about Yogesh Deveshwar and Sridhar Vembu, check these out :</p>
<p><a href="">https://youtu.be/BRVNk_JwgQQ</a></p>
<p><a href="https://youtu.be/-Vgakw9Unwc">https://youtu.be/-Vgakw9Unwc</a></p>
<p>When you say why are people working in American companies not really attached to India, its not really a flaw [and is not really true, look at the examples below]. They just don’t have a skin in the game in India. India’s progress or doom is something that might effect them at some level depending upon how close they feel to the country, but that’s not their bread and butter. They have moved to a new country and that new country gave them a lot, they would be indebted for it. Why should Kamala Harris be attached to Indian nation when she has no give and take with it ? She is as she is supposed to be an American. Mr. Pichai, by the way, has given anecdotes about his humble Indian roots :</p>
<blockquote>
<p><a href="https://www.news18.com/news/buzz/google-ceo-sundar-pichais-dad-spent-one-years-salary-for-his-flight-ticket-to-america-2659187.html">Google CEO Sundar Pichai’s Dad Spent One Year’s Salary for His Flight Ticket to America</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image20.png" alt="" /></p>
<blockquote>
<p>There is one example that you should know more btw. Laxmi Mittal still proudly holds an Indian passport btw : <a href="https://en.wikipedia.org/wiki/Lakshmi_Mittal">Lakshmi Mittal - Wikipedia</a></p>
</blockquote>
<p>You do understand it would have been harder for him to build a business empire than say those who just accepted an alternative citizenship, but he chose to be a successful “Indian”. I immensely respect him for that.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-31-Thoughts-on-contemporary-Indian-society/media/image21.png" alt="" /></p>
<p>OTOH, listen to Mr. Vembu {and maybe follow him on twitter} and late Mr. Deveshvar. Building an organization or business in India is as hard or even harder than that in US, but that is possibly much less acknowledged.</p>
<p>That is the important question and one you should ask, <strong><em>why is the effort successful people make in India not acknowledged just as much as people who make it big abroad ?</em></strong></p>
<p>There are two reasons for it IMO :</p>
<ol>
<li>
<blockquote>
<p><strong>Our period of poverty during over 1000 years of foreign rule and the programming on psyche that comes out of it :</strong> During a century of extractive governments, we really did not have examples of our people doing great things. Indians were trying to feed their children when Europe and America were well fed to set the modern science and modern business and politics. The dog-eat-dog mentality that Indians and foreigners so despise are a result of extreme helplessness. So is the thought of “falling into the line”. When foreign powers were punishing those who tried to do their own thing, the only survivors would be ones who just do what is expected of them. Indian psyche for a very long time has trusted sure shot ways and not “risk taking”. Ones taking jobs with government and MNCs are rising doing the safer thing, that is what psyches of many Indians have been programmed to like, and that was possibly ok when the risk appetite was low. As the risk appetite of Indians grows, you see appreciation for boldness, entrepreneurship, Indian-ness and “risk taking” coming forth. This would only get better.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Our elites {specially in media} have moved up in life with the status quo of a dependent India. This is “American”, “Swiss”, “British” or “Japanese” has been the narrative to describe high quality or good things and ideas. With this narrative, of course, an achievement is bigger when someone becomes dean of a foreign university, or CEO for a MNC. I am not in anyway saying these are small achievements, they are all great, but much more effort goes into pulling off a success in India. The same is true in other fields : Art, Cookery, Politics, Sports and so on. Its harder to succeed and come up in India {and luckily its getting easier} and for some time our achievers were slightly behind the rest of the world in absolute numbers. As India becomes more meritocratic, you see Indian achievers becoming more famous on world stage. For example, we Indians now know that our cricket team is much better than all others. I mean they might lose sometimes, but look at the dominance. We had great players pre Dhoni era too and I remember I was fan of many foreign players as a kid [South Africans, Australians and Pakistani bowlers], but now most Indians acknowledge our team has the best cricketers. A similar trend you would see in all fields soon.</p>
</blockquote>
</li>
</ol>Collecting some answers summarizing my thoughts on contemporary Indian society and education system. Since I come from a lower middle class/middle class background, a lot of thoughts might be middle class specific.Thoughts On Indian Perennial Economic Topics2020-12-25T00:00:00-06:002020-12-25T00:00:00-06:00https://muktabh.xyz/2020/12/25/Thoughts-on-Indian-Perennial-Economic-Topics<p>My thoughts on some perennial economic topics of India :</p>
<h3 id="q-how-does-the-rise-in-inequality-distort-indian-society">Q. How does the rise in inequality distort Indian society?</h3>
<p>Originally answered here: <a href="https://qr.ae/pND8Oj">https://qr.ae/pND8Oj</a></p>
<p>Wealth/Income Inequality is not necessarily a bad thing. However, there are some consequences of these that make the society unstable. IMO campaign against “wealth inequality” should actually be a campaign against excessive “gatekeeping/rent-seeking” behavior. Gatekeeping/rent-seeking is when the privilege induced by wealth inequality starts translating into suppressing fair competition and meritocracy. The distortion in society you attribute to wealth inequality is actually created by the . However, “end wealth inequality” makes a better political pitch and hence everyone gets on-boarded onto that wagon.</p>
<p>Wealth Inequality has its advantages too. It creates many able people who can take risks to do innovation rather than a single entity {state in communism} say. When a single entity does innovation [in science, business, technology ] on part of entire population, just one failure could make the entire system crash. Many individuals tinkering things gets a lot of innovation into the system without the risk of failure. The more innovation is, the more possibility of creative disruption and wealth redistribution to new people. This is one of the core premise of Stephen Pinker’s book Enlightenment Now. {Must read btw, I liked it a lot}.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image1.jpeg" alt="" /></p>
<p>Stephen Pinker shows that liberalism [earlier classic liberalism which evolved into neoliberalism] which evolved from renaissance ideas has been making human life better everyday statistically, despite many of us thinking otherwise.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image2.png" alt="" /></p>
<p>We have seen inequality in the world rise and still humans getting a better life each progressing year. So technically, its clear that inequality is not bad directly.</p>
<p>However, gatekeeping does come up as a side effect of inequality. This is something that Professor Pinker doesn’t talk about in his book a lot, but one cannot deny such a thing. So for example, a rich person may use their contacts to influence behavior away from a less rich person. In more brute terms, this would be done by just overriding “meritocratic” criteria {like how its shown in legendary scene of movie Deewar, “I am sorry, the other candidate knew someone who knew someone, we cannot give you the job” } :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image3.jpeg" alt="" /></p>
<p>Or more cleverly changing the meritocratic criteria to something the poorer person cannot afford. So new criterion added for qualifying jobs, which specifically the less fortunate cannot afford to get good at. In movie Deewaar, the job was a clerk, but think of such things happening in jobs in administration and bureaucracy.</p>
<p>The same thing could happen with government and private contracts, honors, scholarships and many other things reducing the power of someone who is less rich than the other. Merit can be overridden with credentials quite easily and most people would continue to think they are in a meritocracy while they are playing a rigged game. And then one day common people suddenly wake up to the reality and would want to change society overnight making things worse for all.</p>
<p>The other thing that can be used to “gatekeep” is fear. They know that the risk tolerance of the poor masses is low, so if they can make anything which is good for the masses more fearful than it actually is, the poor masses would deny the advantage despite of all the positives. Indians have been kept away from entrepreneurship and businesses by Indian Communist intellectuals [who despise themself as rationalist] portraying business as bad and stock market as sin and economy as something driven by import-export. We might laugh at it as it sounds like conspiracy theory, but ask a common man and he is still skeptical of private companies and trusts government and its slow bureaucracy more. Indian middle class came out of this mindset after the 1991 economy liberalization, but our poor masses and traditional industry like agriculture workers are still stuck in this mentality. Inequality doesn’t distort the society, but when software engineers are making 21st century salaries and farmers get low money like 1980s for their products, software engineers will have much more risk appetite and be able to take risks. Unfortunately, a lot of “experts” in the country think that sticking to the status quo is better than letting farmers take some risk of market economy.</p>
<p>There are many ways to address [not avoid] these situations like how different countries are solving it :</p>
<p>A. Welfare state like in Europe.</p>
<p>B. Cultural defense like in the US. US has a cultural orientation to achieve C below. Whether the cultural thing works or US moves towards A is still to be decided.</p>
<p>C. Tying the incomes of poor and the rich in some way through government policy or molding national culture to achieve it so that one getting strong means other getting strong too like in Taiwan and China. China is a mixture of A and C.</p>
<p>[What I feel is a good way to achieve it in India in future would be a mixture of A, B or C depending upon which among US and China is the world power in future and our own situation ]</p>
<p>We now know three things :</p>
<ol>
<li>
<p>Societies which prospered have had inequality. There should be better off people who can take different risks bringing about innovation.</p>
</li>
<li>
<p>However, inequality can lead to rent seeking in things outside money which can sometimes make common people dissatisfied. Dissatisfaction makes society unstable. Basically few people are jealous of another person’s wealth, but most feel bad if the rich person uses their wealth [or influence of wealth] to get ahead in things where they feel the rich person is not as good.</p>
</li>
<li>
<p>Another thing inequality creates is different risk appetites of rich and poor people. If something that makes good money for poor can be somehow shown to be risky, the poor would willingly give it up, letting the rich take all advantage of the proposition.</p>
</li>
</ol>
<p>Let us now understand the Zero Sum game that people associate with inequality [and why its irrelevant in the current world].</p>
<p>Basically in a capitalist system, people assume :</p>
<p>Earnings - expenditures - Wages [Labor Income] = Profits [Market Income]</p>
<p>Now since everyone is greedy [something on which communism and libertarian thought agree] , the only way to make more money is increase earnings [so expand the market of the country to abroad], reduce expenditures [get cheaper machinery and land from whosoever offers it at the best price] and when both of these saturate, workers and shareholders would on opposite ends as one would try to increase the Labor share [wages] and the other will try to maximize profits [profits]. So when the economy reaches a saturation point, workers and investors are shown to be fighting in a zero sum game where rich grow richer by taking away poor persons’ wages. BTW, that is not totally false when we look at the times of industrial revolution in England and Europe. <a href="https://firstindustrialrevolution.weebly.com/working-and-living-conditions.html">Working and Living Conditions</a></p>
<p>. The entire philosophy of Communism came out of this ill treatment of workers. There is no doubt that the workers need enough money to survive at the least, by survive I mean [Food, Shelter, Health, Education], if a capitalist system cannot provide that, it would collapse like in 20th century Russia or China. So if a capitalist system is surviving, it has at least found a equilibrium where workers don’t have to worry about “survival”.</p>
<p>This “model” of inequality, however, is now redundant because : A. Most first world countries have removed need to worry for survival and developing countries are quickly following them. B. Most new capitalist wealth [specially in big tech is not being generated by dividents/profits but by growth investing <a href="https://en.wikipedia.org/wiki/Growth_investing">Growth investing - Wikipedia</a></p>
<p>].</p>
<p>Indian worker is not one defined person, there are people living in pre-1990s socialist India in some industries [with socialism level ‘according to their needs’ low wages] and there are people writing blockchain as well. This actually creates a very different income distribution, which should be India’s primary aim to solve. <strong><em>India still has to complete solving problem of providing everyone with necessities before we focus full on solving a first world problem like “income inequality”.</em></strong> If we are unable to bring all sectors of economy in the same economic system soon, we will have to solve dual problems of income inequality for some segments of society and survival for other segments. We are lucky to blessed with an growing economy so that these problems are not pinching us hard right now, but we should build policies which aim to achieve equilibrium during the period of high growth.</p>
<p>We are not doing bad btw :</p>
<p><a href="https://www.forbes.com/sites/niallmccarthy/2019/07/12/report-india-lifted-271-million-people-out-of-poverty-in-a-decade-infographic/?sh=44d7ec262284">Report: India Lifted 271 Million People Out Of Poverty In A Decade [Infographic]</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image4.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image5.png" alt="" /></p>
<p>With new reforms being introduced in traditional sectors of economy, you should think that India will eventually have a structure like the west has today and China is soon approaching :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image6.png" alt="" /></p>
<p>But what about eventual capitalist systems where all economies eventually reach, where workers are earning enough to not have survival issues ? Where should workers invest the extra cash they earn ? Should there be worker protectionism [say minimum wage or protection of traditional industries] or workers need to look after themselves? Are the workers supposed to create a moat just like investors do ? When in a society people are earning enough to live, the next question is where do they spend ? While most investors will hardly indulge in spending just for the heck of it and will invest their money, workers are encouraged to buy stuff. As J J McCullough says, middle class [which is now the default worker class in OECD] is based on three proponents :</p>
<p><a href="https://youtu.be/OsUEbN6NZr0"><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image7.png" alt="" />https://youtu.be/OsUEbN6NZr0</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image8.png" alt="" /></p>
<p>These words might sound bad, but they are not . “Anxiety” is basically the push that makes people work hard to make sure their family continues to have a good living. “Consumerism” is buying things to make life better for family and “Conformism” is doing what rest of middle class is doing to make life better.</p>
<p><strong><em>How India will build the new culture of its upcoming middle class around Consumerism and Conformism will define how we solve the problem of inequality.</em></strong> We would either go the China way or go the Scandinavian/Russian way or the West Europe way. Referring to observations of the paper <a href="https://stonecenter.gc.cuny.edu/research/capitalist-systems-and-income-inequality/">Capitalist Systems and Income Inequality</a></p>
<p>going forth.</p>
<p>Please look at the following curve, India lies with other “developing economies” like Mexico, Brazil etc in the fourth Quarter. This basically means we are still a partially traditional economy and partially modernized one. [Only somewhat modernized economies listed here].</p>
<p>The Y axis is proper wealth inequality [compositional inequality or Mathematically Gini Index, Y=1 means all welath with one person and Y = 0 means everyone with same money] and X axis basically tells if the “source of income” of rich and poor are the same or different. [1 being totally different]. Right now India’s rich primarily make money from investing in stocks, real estate and other safe financial instruments while poor make money by selling their time on agricultural fields and workshops, so its near 1 from India obviously if you have been reading my answer.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image9.jpeg" alt="" /></p>
<p>You can see clusters of countries, like West Europe in Green, East Europe and Scandinavia in brown cluster, Taiwan and Slovakia in a unique cluster and China in its unique cluster and Israel and America in one. East and West Europe clusters depend upon welfare state to address inequality. I think with the free market type approach India now has, it would eventually reach a US like situation [mixed consumerism/investing culture]. For China like situation, India would have to mandate workers [or create a culture] to spend in a way that mirrors how the rich spend their money [Investing in low but non-zero risk financial products and not consuming goods with all the money they earn] .</p>
<h3 id="q-what-if-india-would-be-full-of-foreign-companies-and-no-indian-company">Q. What if India would be full of foreign companies and no Indian company?</h3>
<p>Originally answered here : https://qr.ae/pNaHms</p>
<p>It won’t be possible to have no Indian companies at all. A nation cannot just be a market (like what happened during colonialization) or a market+sweatshop (like how people would imagine a situation like this to happen in modern world) forever. Let’s discuss both these scenarios :</p>
<p><strong>Colonial Times (Colony is just a oligopoly market for foreign companies):</strong></p>
<p>One cannot eliminate all Indian companies even during colonial rule, you would always require help of local entrepreneurs and businessmen. There were many British business owned stooges in India during colonial times. So even in a colony, there will be either subsidiary companies or suppliers despite we trying to push out all Indian companies. But we have had an extreme low of influence of Indian businesses in our market.</p>
<p>The closest to having no local companies and only foreign company India reached was during the British colonial rule (and the East India “Company” rule before that). Not all the companies and businessmen were British or European, but most of the important ones were. Regulations and tariffs were used to not just pay Indian merchants with money extracted from Indian farm revenue thus making India’s money supply low, but also there goods were made less competitive so that they could not compete in Europe or even in India.</p>
<p>India’s cotton businesses were for example forced to close to keep only British businesses in the European and even Indian market. <a href="_blank">Textile manufacture during the British Industrial Revolution - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image10.png" alt="" /></p>
<p>Cotton made Bengal probably the richest province in India and once it lost its trade advantage, the money supply to Bengal was greatly reduced. Similarly, Indigo, Salt and other exports of India were actively thwarted and India’s gold was taken away as British company’s were more competitive than Indian counterparts due to regulation. Think of it, buying a product made in UK was cheaper than local Indian products. <a href="_blank">Economy of India under Company rule - Wikipedia</a></p>
<p>So an extractive economy where British Government could make laws to make British companies more competitive essentially did wipe out Indian companies. Let’s talk about Bengal in particular, Bengal had a better per capita income pre-British conquest than all of Europe and Britain itself. It was possibly more industrialized too. In a few centuries of trade deficit and many man made famines (<a href="https://en.wikipedia.org/wiki/Great_Bengal_famine_of_1770">Great Bengal famine of 1770 - Wikipedia</a></p>
<p>, <a href="https://en.wikipedia.org/wiki/Bengal_famine_of_1943">Bengal famine of 1943 - Wikipedia</a></p>
<p>) , it was poor super densely populated Indian state (due to its poor populations from erstwhile industrial nodes and their supply hinterlands) which had to move to a desperate measures like communist governments to keep the society from falling apart from lack of wealth. There is a reason India went full “no to international trade” during 1947–1991. I don’t think I need to explain why India will not want to become a colony anymore.</p>
<p><strong>Modern Times (Less income countries are markets + sweatshops for large first world companies)</strong></p>
<p>In modern times, an alternative way is possible to reach close to the theoretical point of having no local companies at all. That way is for a low income company to become a sweatshop for companies of first world companies. First world companies have high labor rates so they enter low income countries to manufacture. This manufacturing capability can expand to make prices of their product/services much more competitive/high quality to enter markets of third world country too, eliminating companies serving third world countries. Rising incomes in the third world country would make more foreign countries rush to cater the demand of middle class as the local company ecosystem for this country would have been shrunk to give a credible competitor.</p>
<p>This process is not at all bad for the third world country btw. Incomes rise, People come out of poverty, good quality products are available for cheap. Adam Smith’s “The invisible hand” profits both parties involved. India has lived in this type of a bubble during 2000–2012 say. <a href="https://en.wikipedia.org/wiki/Economic_development_in_India">Economic development in India - Wikipedia</a></p>
<p>. You can say some phase of this continues even today. Everyone loved working at Microsoft and eating at McDonald’s during this time. (I remember this too well as I joined workforce around 2012, when the trend had started dieing after the world had witnessed 2008 economic downturn). There are proponents of opening up many other guarded sectors of Indian economy to free trade to let incomes go up even more. An Indian milkman still earns much less than say an Indian who does Data Entry in a IT company. There is some action on it too, where Indian government keeps relaxing FDI limits for different sectors. One can thus surely ask, why not just go all in on full trade ? just let incomes rise, we loose business capabilities locally but large companies sure employ many people with more sturdiness to cycles of economic downturns. A job in a large MNC is safer than a job at a startup.</p>
<p>The reason is perfect efficiency (absolute free trade in this case) is good in short term and can be used to increase income and competitiveness, but is not really a good long term strategy. <a href="https://www.quora.com/How-far-can-India-go-to-keep-the-Chinese-players-who-are-well-en-trenched-in-the-global-tech-supply-chain-off-the-Indian-market-without-prejudicing-its-own-growth/answer/Muktabh-Mayank">Muktabh Mayank’s answer to How far can India go to keep the Chinese players, who are well en-trenched in the global tech supply chain, off the Indian market without prejudicing its own growth?</a> . While the linked answer of mine is more theoretical, I will give a practical example of what happens if we let free trade fully take over, where world leader MNCs are sure to beat out local Indian companies in terms of quality and price (or both). {If you think on lines of ohh, Indian companies should step up and compete against these giants, why give them a break, read my answer here: <a href="https://www.quora.com/How-does-a-company-that-sells-a-powerful-software-package-like-MS-Office-survive-when-others-offer-a-free-equivalent-package/answer/Muktabh-Mayank">Muktabh Mayank’s answer to How does a company that sells a powerful software package like MS Office survive when others offer a free equivalent package?</a> . TLDR is that a business with better ecosystem and knowledge advantage cannot be defeated most of the times. We need to help our local companies stay competitive while avoiding building a monopoly for them. }</p>
<p>So, the problem with the countries which took this model of being just a market and a sweatshop killing local companies to the extreme is eventual <a href="https://en.wikipedia.org/wiki/Middle_income_trap">Middle income trap - Wikipedia</a></p>
<p>. No doubt the per capita income goes up by a lot and that too comparatively faster than developing ones own industrial/business ecosystem (China is quickly disrupting the narrative of indigenous ecosystem based development is slow btw) . Major case studies for such economies are 1. Thailand and 2. Brazil. Thailand is very interesting. <a href="https://en.wikipedia.org/wiki/Economy_of_Thailand">Economy of Thailand - Wikipedia</a> is one of the best economies of Asia. It has decent per capita income (much better than an average Asian country) and even a welfare state. It is a manufacturing base of cars, electronics and jewellery. Do you know of any Thai car companies ? No. Most of these are MNCs. Luckily the tourism sector of Thailand is innate and cannot be really a fully foreign run sector like agriculture sector of India. Look at its neighbors and Thailand dwarfs them economy wise just moving with and supporting free trade. Probably a mini model of what a India moving on similar lines would look like. What is the harm in being like Thailand you ask ? No ecosystem to take them ahead of where they are now. They have a huge sovereign fund which they can probably use to fund their people, but there is a very small software ecosystem, a very small deeptech ecosystem, a very small startup ecosystem (say compared to much poorer Indonesia: <a href="https://www.mime.asia/7-best-famous-startup-indonesia/">7 Best Famous Startup Indonesia</a> ) , the things that would drive the future of growth. People have been engaged in industrial manufacturing jobs that suffered a jolt due to the pandemic and launch of electric vehicles. Tourism went down due to the pandemic and now you have widespread social unrest. <a href="https://www.ibtimes.com/tensions-mount-thai-protests-bangkok-braces-major-rally-3087932">Tensions Mount In Thai Protests As Bangkok Braces For Major Rally</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image11.png" alt="" /></p>
<p>When people don’t see growth in their personal lives they get frustrated with authority. This is how classic Middle Income Trap works. Look at Brazil and you will see parallels too.</p>
<p><strong>Conclusion:</strong></p>
<p>OK. That’s what I wanted to say, not having local companies reduces chances of people being lucky and getting rich. In colonial times, it was also accomplished by abject poverty. In modern times, not having large local business ecosystem doesn’t make people poor, in fact they start doing better quite fast. However, with this stability/peace of mind, it also reduces risk-taking capability. As Zuckerberg says, “Biggest risk is not taking any risk at all”. <a href="https://www.policygenius.com/blog/mark-zuckerberg-facebook-risk-advice/">How Mark Zuckerberg thinks about risk — and what you can learn from it</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image12.png" alt="" /></p>
<p>Risk of automation, stagnation and social unrest comes with middle income trap. A later generation pays the price of one generation’s risk aversion.</p>
<h3 id="q-how-can-we-evaluate-the-success-story-of-bangladesh-in-the-recent-times-which-is-transforming-towards-a-fastest-growing-emerging-economy-from-the-status-of-a-poor-country-is-there-anything-which-india-need-to-replicate">Q. How can we evaluate the success story of Bangladesh in the recent times which is transforming towards a fastest growing emerging economy from the status of a poor country? Is there anything which India need to replicate?</h3>
<p>Originally answered here: https://qr.ae/pNiVrQ</p>
<p>Good Question.</p>
<p>Let’s try and understand that Bangladesh and India have always been neck to neck in growth rates. Its not a sudden spurt of genius on part of Bangladesh and misadventure on part of India that has lead to a switch. Look at the timeline, Bangladesh has been chasing India’s growth rate and the gap had been going down for a long time, until it overtook India.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image13.png" alt="" /></p>
<p>Let’s answer the question why has Bangladesh done so well ? Textiles and cheap manufacturing is the answer. Specially Textiles. Clothes and ready made goods are such a huge market that they keep economy of Bangladesh and Sri Lanka (also some tourism) and to some extent Pakistan afloat alone.</p>
<p><a href="https://en.wikipedia.org/wiki/Textile_industry_in_Bangladesh">Textile industry in Bangladesh - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image14.png" alt="" /></p>
<p>Think of it, Undivided India (which is today’s India and Bangladesh and Pakistan) was the textile super power of the world and textiles had made GDP per capita of Bengal (Now Indian state of West Bengal and Bangladesh) larger than Europe and in fact UK, our then to-be colonial masters. British rule had almost destroyed our industries (textiles and otherwise), but with UK going into war production during world war 2, they revived somewhat to meet local demand and there was a boom post independence.</p>
<p>India continued to make its textiles industry more and more noncompetitive in the international market and Bangladesh took full advantage by introducing market reforms. Bangladesh’s ready made garment exports are larger than India and even China !</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image15.png" alt="" /></p>
<p>Indian farmers produce enormous quantity of fibre, but our textile production is extremely low (4% of the world). Many branded clothes you wear even in India come from Bangladesh despite us growing huge amounts of fibres. Indian textile industry failed to continue to be competitive. <a href="https://en.wikipedia.org/wiki/Textile_industry_in_India">Textile industry in India - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image16.png" alt="" /></p>
<p>So what was the problem ? Why did Indian textiles loose the status of a behemoth and we lost the race in this lucrative industry ? Being resistant and unprepared for change is the answer. While there is a certain cosiness and comfort in a booming industry, we need to make sure that we are reinvesting enough to keep it relevant and competitive. That generally is something people don’t see in the middle of the boom.</p>
<p><strong>India failed to move its textiles industry to hinterlands :</strong></p>
<p>When an industry is at its zenith, the wealth it creates might start pushing it into being less competitive. India’s textiles were situated in large cities like Mumbai and Surat and the like. They then moved into lower cost Dhaka and China. Why not say Kanpur or Patna or Cuddappah ? India was so busy eating the fruit of its successful manufacturing (sweet tax and forex dollars !!) then that it forgot that you don’t slaughter the goose laying golden eggs.</p>
<p><strong>Socialism became Stagnation-ism :</strong></p>
<p>While Socialism is good for people (some version of it which I subscribe too :D ), but the obstructionist version of it is just a drag. I mean just look at difference between India and Bangladesh’s attitudes towards strikes. Strikes basically mean workers topping work if demands are not met. Not saying the attitude of Bangladesh was good, using police power to crush the resistance to production : <a href="_blank">Textile industry - Wikipedia</a></p>
<p>.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image17.png" alt="" /></p>
<p>But Bangladesh has stayed to stay competitive and that is all probably all that matters if we look at everything from the lens of GDP per capita. Different people can have different opinions about whether poor working conditions are better than abject poverty. In India however, our politicians forced the entire textile industry in Bombay to close down losing jobs of everyone than working in poor conditions. IMHO, there should have been a middle path where we could have thought of a way in which both textile industry and workers compromised a bit, textiles survived and workers got slightly better working conditions at the same time, but well I dont think you can make a movie on it (with a Che Guevara like poster) : <a href="https://en.wikipedia.org/wiki/Albert_Pinto_Ko_Gussa_Kyoon_Aata_Hai">Albert Pinto Ko Gussa Kyoon Aata Hai - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image18.jpeg" alt="" /></p>
<p>Read more here : <a href="_blank">Great Bombay textile strike - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image19.png" alt="" /></p>
<p><strong>India’s apathy towards manufacturing :</strong></p>
<p>Post 1990s’ economic liberalization, India went into a Neoliberal Spree. Even if India produced cheaper textiles, our people would have purchased American or German (which would have been manufactured in China/Bangladesh). India might get some of our manufacturing back with the recent <a href="_blank">Make in India - Wikipedia</a></p>
<p>trend, but at least in a huge sector like Textiles, at best we can hope for is to sell our textiles locally, we are too behind and non-competitive to see a global export dominance anytime soon.</p>
<p>The most important part, Lessons from Bangladesh:</p>
<p><strong>Manufacturing (and other traditional sectors) is still huge, don’t discount them:</strong></p>
<p>India has its romance with software and services, but manufacturing and other traditional sectors of economy are still huge. Bangladesh could defeat us in GDP per capita by just dominating one traditional industry.</p>
<p><strong>Ecosystem needs small changes to stay competitive :</strong></p>
<p>The industries which are competitive right now for India should now just be looked on as cash cows. We need to make them more sturdy towards changes. One trick I can think about IT industry was to move it to tier2/3 towns by building good infrastructure for them in such towns. India is such a huge country with such economic disparity that no industry can ever become non-competitive.<a href="https://www.quora.com/How-is-Indias-Information-Technology-IT-industry-likely-to-evolve-over-the-next-25-years-Or-is-it-going-to-flicker-off-and-extinguish/answer/Muktabh-Mayank">Muktabh Mayank’s answer to How is India’s Information Technology (IT) industry likely to evolve over the next 25 years? Or is it going to flicker off and extinguish?</a></p>
<p>Bangladesh’s rising per capita income will soon put its textiles industries in same situation of stay competitive or GTFO of Dhaka. Bangladesh would want to make the industry stay in its hinterlands than letting it move to Mandalay or Rakhine in the nighborhood.</p>
<p><strong>While of course people can worry about their finance today, they also cannot be too complacent :</strong></p>
<p>One incident from today that reminds me of the downfall of textiles industry is ongoing farmers’ protest from state of Punjab in India. Punjab traditionally has been India’a wheat basket, but they cannot assume that with them refusing to take up efficient procurement/market practices within India, India will be forced to look outside for grains (people cannot go hungry) and we are going to through the textile industry route with farming in Punjab. The best case IMO scenario for India and Punjab is : “Other states of India continues its dependence on Punjab by giving Punjab agricultural goods preference over international, getting them good prices and Punjab embraces the free market practices the rest of the nation has and efficiency of national supply chain goes up”. Not trusting the rest of the country is not going to go well.</p>
<p>Unfortunately, this makes for a poor pitch politically as compared to surrounding Delhi roads and obstructing supply chain infuriating the urban natives who actually make policy ! Suggesting changes in farming reforms is one thing, demand of rolling reforms back or the national capital will be chocked for a few months is a different thing.</p>
<p><a href="https://www.deccanherald.com/national/farmers-plan-delhi-siege-to-protest-farm-sector-reforms-919535.html">Farmers plan Delhi siege to protest farm sector reforms</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image20.png" alt="" /></p>
<h3 id="q-do-you-think-healthcare-and-education-merit-more-spending-to-make-indias-economy-immune-to-future-shocks">Q. Do you think healthcare and education merit more spending to make India’s economy immune to future shocks?</h3>
<p>Originally answered here : https://qr.ae/pNl3Y5</p>
<p>It’s a very broad question and my short answer is “Spending money with good RoI will be helpful, but not just ‘spending money’ for the heck of it”. I also think that we Indians need to think of healthcare and education from an innovation point of view rather than just spending assuming the current western systems are the right ones, we are solving these problems at a much bigger scale than any western country does.</p>
<p>Looong subjective explanation below :</p>
<p>Do you really think India’s spending on these sectors is less ? 11 Rupees out of every 100 rupees spent in India are directly spent on healthcare and education. There is also a lot of money spent on infrastructure and transportation, like roads and transport that makes these amenities possible.</p>
<p><a href="https://www.quora.com/Where-should-the-Indian-government-invest-more-money-defense-or-healthcare/answer/Muktabh-Mayank">Muktabh Mayank’s answer to Where should the Indian government invest more money, defense or healthcare?</a></p>
<p>India spends a lot on healthcare , around 150 Billion Dollars every year. Our total GDP is < 3000 Billion dollars. So for every 100 rupees spent in India on every possible aspect, 5 rupees are spent in healthcare. When you suggest increasing spending in healthcare, you are essentially advocating one of three things :</p>
<ol>
<li>
<p>Increase total size of Indian economy, as a result, many healthcare expenses that people cannot make as of today {say on mental health}, would become more accessible, raising the healthcare spending more. <strong><em>I hardly think anyone is against this.</em></strong> There are many places where India’s poor would rather not approach a doctor when the immediate risk is relatively lower and healthcare would become more accessible as they get richer. By all means, our people should get richer and have a more comfortable life having amenities they don’t have now.</p>
</li>
<li>
<p>Government investing into the healthcare sector, subsidizing some of the essential healthcare temporarily till economy of scale is achieved. You can see this happening in <a href="https://en.wikipedia.org/wiki/Ayushman_Bharat_Yojana">Ayushman Bharat Yojana - Wikipedia</a></p>
</li>
</ol>
<p>and <a href="https://en.wikipedia.org/wiki/Pradhan_Mantri_Bharatiya_Janaushadhi_Pariyojana">Pradhan Mantri Bharatiya Janaushadhi Pariyojana - Wikipedia</a></p>
<ol>
<li>. This is taxpayers money subsidizing healthcare for masses making them physically fit so that they can eventually work towards a better economic profile where they can take care of themselves. This type of government spending is a double edged sword, as it does provide impetus to make a robust and scaled up economy, but one needs to make sure that the goal is not always to fund bottomless loss making black holes. Democracies often go overboard in such circumstances to win elections ! People generally expect the money systems to lead to circumstances like mentioned in point 1 above, but government and institutions many times nudge people into point 3 below because of the amount of power it concentrates. For countries with low individual incomes like India, having spending to ensure public accessible healthcare is important and that is the reason there is a considerable public spending towards accessible healthcare in last 10–15 years. India despite of all negative portrayal it gets has one of the most accessible public healthcare systems in world. [See Guardian article below]. <strong><em>Most political centrists {which is most of the people} would like this approach [A private + public healthcare combination to secure both accessibility and quality]. Very libertarian people might not like it.</em></strong></li>
</ol>
<!-- end list -->
<ol>
<li>The third is a Europe style fully public healthcare sector with taxes levied on everyone to fund a agency like NHS. Many people who complain about low healthcare spending are basically complaining about “low government spending in healthcare” and not “low spending in healthcare in total” and they are basically asking for a state controlled healthcare. Basically, “Experts” decide who gets to visit which doctors and when and what medicines can the doctors prescribe. As you might be clearly seeing, leaders, executive and government have too much power here. Getting to decide fully how to spend whole of country’s healthcare money is too much power, which can be exploited. <strong><em>Its a matter of personal opinion whether people trust their ruling elites and experts to make all healthcare decisions on their part and naturally a lot of them will disagree on this.</em></strong> IMO, Private competition is always good for public firms, public firms do not need to compete in terms of profitability, but they should at least be competitive in terms of quality. In countries of Latin America and many other parts of the world, you see leaders politicizing their spending policies leading to bloated and below standard public money suckers. <em>Many leaders who pitch “great” , ”free” healthcare to you often have this plan in mind. As is obvious, this would a dividing topic.</em></li>
</ol>
<table>
<tbody>
<tr>
<td>[‘This scheme is a lifesaver’: India’s drive to provide cheap drugs</td>
<td>Amrit Dhillon](https://www.theguardian.com/global-development/2018/jun/25/this-scheme-is-a-lifesaver-india-drive-to-provide-cheap-medicine-jan-aushadi)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image21.png" alt="" /></p>
<p>Education sector is even larger :</p>
<p><a href="https://www.vccircle.com/indias-education-market-nearly-double-180-bn-2020-1/">India’s education market to nearly double to $180 bn by 2020</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image22.png" alt="" /></p>
<p>This is 6 rupees out of every 100 rupees spent in India. Not a small number. Just like healthcare, its not all government spending. Individuals can choose what schools they want to send their kids to [and that can be public schools and private schools] than government taking money as taxes and allocating your kids to a school they think is more suitable for your kid. I guess to a certain extent, just like healthcare, we all can agree that there is a minimum amount of expenses that the country needs to do to train its Human Resources. <strong><em>There is a common ground on having some public spending to look after the less fortunate and other people having a choice to get the best education possible for their kids.</em></strong></p>
<p>Just like in healthcare, Many people complaining of “low spending in education” are complaining of “low government spending on education”. Basically government setting up education norms and schools for everyone. I need to see examples of a successful and fully funded public education systems to believe this is something that would work. One pilot project of a school with swimming pool and horse-riding and snooker table is different than burning public money maintaining this quality across all public schools of a country. This asymmetric spending {much more than what one can afford personally} will also put small private schools out of business as it sets unnecessary standards on education, making private education more costly, making people rely more on public schools. As I said, public spending is a double edged sword which can enhance or break economy. The aim is to keep public spending to keep public institutions competitive to private ones, not blow the private institutions away. If we do latter, we would have a education scenario like healthcare scenario 3. A lot of people won’t like that.</p>
<p><strong><em>Net net, as long as spending on healthcare and education is “justified”, I guess most citizens will have no objections to such expenditures and some increase in them.</em></strong> Just that different people have different definitions of justified. A lot of them think that horse-riding in schools is necessary and others think a good science education is all that we need. Similarly, some people will think that having a dermatologist in every village is necessary, while others think a functional basic healthcare center is good enough.</p>
<p>IMHO, as long as the spending is being done as an investment which will pay the nation back as healthy, scientific and analytical citizens, it is “justified”, the day its done just as a decision to win votes, it makes a economic black hole. Being immune to shocks doesn’t involve being more “prepared”, but rather having less “bloat” and being “agile”.</p>
<p>How to be spectacularly wrong.<br />
The October 2019 predictions of preparedness for epidemics turned out to be entirely unrelated to the actual outcomes.<br />
My new post.<a href="https://t.co/HyIWRW8F5m">https://t.co/HyIWRW8F5m</a></p>
<p>— Branko Milanovic (@BrankoMilan) <a href="https://twitter.com/BrankoMilan/status/1353031522207621121?ref_src=twsrc^tfw">January 23, 2021</a></p>
<p>You can never be prepared enough against a “black swan” event like a pandemic, all you can do is to minimize tail risk. In economics, tail risk is stagnation and low return on investments. Doing any investment which will give poor return on investment is basically making oneself {or in this case the country}, more venerable to shocks.</p>
<p>Lat but not the least, I think we need to start thinking of the fact that no western country has solved the problem of healthcare and education, so we need to stop looking towards them for giving use ideal models to follow. What we Indians need to do is to figure out an education/healthcare model for 21st century India where we are solving it for over a billion people. The important keys in this area are internet, smartphone penetration and creative disruptions by startups to address supply demand gap or scale up quality supply. We Indians can actually better the quality of public services without really spending much if we can innovate our challenges away.</p>
<p><a href="https://www.quora.com/Are-critics-being-too-harsh-on-EdTech-start-ups-in-India/answer/Muktabh-Mayank?ch=10&share=2eba20be&srid=qie">Muktabh Mayank’s answer to Are critics being too harsh on EdTech start-ups in India?</a></p>
<h3 id="q-what-problems-could-india-face-because-of-the-rupee-not-being-backed-by-gold">Q. What problems could India face because of the rupee not being backed by gold?</h3>
<p>Originally answered here : https://qr.ae/pNJvgu</p>
<p>Gold Standard was a strange concept even when it was in practice. It was being used because due to the slow spread of information, it was the only option {if you don’t think Silver Standard was a very different thing from gold one like me}. From <a href="https://en.wikipedia.org/wiki/Gold_standard">Gold standard - Wikipedia</a></p>
<p>:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image23.png" alt="" /></p>
<p>It led to strange fluctuations in currency values and basically reduced the monetary power government had. In times of bad economy like pandemic, war or depression, gold standard made things much worse. {It’s hard to extract directly from people who are already in bad times to revive economy, QE is a necessary evil in bad times ! }.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image24.png" alt="" /></p>
<p>Excess of QE is what a government can resort to in absence of Gold standard. That is possibly one of the greatest mistakes governments make yielding hyperinflation. India however has a monetary policy of stability primarily, avoiding any dangerous adventures. <a href="https://en.wikipedia.org/wiki/Monetary_policy_of_India">Monetary policy of India - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image25.png" alt="" /></p>
<h3 id="q-whats-elder-peoples-reaction-to-times-when-you-could-buy-the-entire-months-ration-in-1-rupee-to-today-where-you-only-get-a-toffee-for-a-rupee-is-the-inflation-worth-it">Q. What’s elder people’s reaction to times when you could buy the entire month’s ration in 1 rupee to today where you only get a toffee for a rupee? Is the inflation worth it?</h3>
<p>Originally answered here : https://qr.ae/pNJvGD</p>
<p>“Is the inflation worth it ?” Of course ! In any sense, India of 21st century is better than India of 20th century {much better than India of 19th century}. A colonized country, whose currency was forcefully pegged to British Pound to facilitate trade in pounds and not changed according to its local requirements, can have a costly currency, but had really poor, malnourished people. [I will share one specific instance about the 1880s in the answer].</p>
<p><a href="https://en.wikipedia.org/wiki/Gold_standard">Gold standard - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image26.png" alt="" /></p>
<p>No country should have an economic {monetary/physical} policy like Argentina in 20th century and Zimbabwe. Crazy crazy inflation :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image27.jpeg" alt="" /></p>
<p>But that said, having no control over monetary/fiscal policy is equally bad too !</p>
<p>India in 19th century and first half of 20th century was a colony whose main aim was to enhance British financial position and power in the world and no better. <a href="https://www.quora.com/What-if-India-would-be-full-of-foreign-companies-and-no-Indian-company/answer/Muktabh-Mayank?ch=10&share=be0329e8&srid=qie">Muktabh Mayank’s answer to What if India would be full of foreign companies and no Indian company?</a></p>
<p>If someone romanticizes the cheap goods during “costly rupee”, ask them “How many siblings did they lose in childhood ?” , “How did the farmers and poor survive the cold winters because of costly British clothes and unavailability of local cheap clothes ?” and “Why did our second Prime Minister had to ask everyone to fast voluntarily once a week when our 1 rupee was equal to a dollar ?”</p>
<table>
<tbody>
<tr>
<td>[India: child mortality rate 1880-2020</td>
<td>Statista](https://www.statista.com/statistics/1041861/india-all-time-child-mortality-rate/)</td>
</tr>
</tbody>
</table>
<p>[More than half of Indian kids died under British, many old people would have lost at least one sibling when they were kids]. What’s the point of having good value of a currency when a country cannot save its kids from dying.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image28.png" alt="" /></p>
<p>Can someone explain if the demand for essentials like clothes reduced despite population going up, what were poor people wearing in harsh winters ?</p>
<p><a href="https://www.sciencedirect.com/science/article/abs/pii/0014498383900414">Employment in nineteenth century Indian textiles</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image29.jpeg" alt="" /></p>
<p><a href="https://censusindia.gov.in/Census_And_You/old_report/census%201881%20table%20moment%20of%20population.htm">https://censusindia.gov.in/Census_And_You/old_report/census%201881%20table%20moment%20of%20population.htm</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image30.jpeg" alt="" /></p>
<p>[The reason is that instead of distributing money to reduce effects of the famines of 1870s, the British government chose not to print more currency <em>{thus not inducing inflation, maintaining good value of Indian currency}</em>, the economy was doomed. People had to sign indentured servitudes {legal serfdom if you don’t get the term} to avoid economic ruin]</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image31.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image32.png" alt="" /></p>
<p>Our currency was almost at the level of dollar when we had to ask the country to voluntarily starve once a week so that food can reach everyone !</p>
<p><a href="https://en.wikipedia.org/wiki/Lal_Bahadur_Shastri">Lal Bahadur Shastri - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image33.png" alt="" /></p>
<p><a href="https://www.inflationtool.com/indian-rupee/1960-to-present-value">Value of 1960 Indian Rupees today</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image34.png" alt="" /></p>
<p>A broad answer is that monetary policy would run to make the people of nation more prosperous on an average. The wealth that is created would be distributed more amongst the people making new money. The old money, however, would want the value to stay fix to continue their hegemony.</p>
<p><strong><em>You cannot make blanket statements about inflation, there is “bad inflation” and “good inflation”. As long as your living standard doesn’t go down due to inflation, you cannot really complain.</em></strong></p>
<h3 id="q-why-do-we-need-to-sweat-day-and-night-for-small-salaries-in-india-whats-wrong-with-the-indian-employment-system">Q. Why do we need to sweat day and night for small salaries in India? What’s wrong with the Indian employment system?</h3>
<p>Originally answered here : https://qr.ae/pNcPOe</p>
<p>Well, I think things have changed a lot now. Risktakers/Experts can actually now make big bucks, that was not the case in the socialist <a href="https://en.wikipedia.org/wiki/Licence_Raj">Licence Raj - Wikipedia</a></p>
<p>days { Degradingly called Hindu Growth Rate by Economists, wonder what Hinduism has got to do with Fabian Socialism we were practicing till 1990}.</p>
<p>The way to making lot of money in Capitalist Neoliberal Economy is Specialization. The way to make money in Libertarian Capitalist Economy is risk-taking. India, as of end 2020, is luckily a mixture of both. Society’s views are pro-capitalist {international solar alliance, agricultural/labor reforms, every administration in India is “Adani-Ambani” in some way} and pro-small business {startup India, Mudra Yojna} at the same time, so you can either become an expert and make money by helping the large capitalists scale or take risks becoming a small capitalist yourself and make money. If one feels they are under-compensated, they are basically averse to both risk-taking and specialization. With a population of over a billion, if you are working in a job with no moat [that is there are too many people to replace you in the real world], economically you would earn less. Economy and businesses are planned and run based on a country’s return on investment and they were mostly built in India assuming low cost of commodity labor given high population. One cannot bank on businesses to finance their foreign trips and “Tata Harrier”s without making efforts oneself. If you increase the cost of commodity labor {by having a white collar minimum wage}, the current economy won’t work at all and there would be need of a different type of economy. I mean guess why white collar jobs are escaping America (and some of them come to India) , their middle class cannot give away the jobs they already hate to their poor class.</p>
<p><a href="https://www.forbes.com/sites/panosmourdoukoutas/2016/05/01/who-sent-american-jobs-away/?sh=4e5a989f62ec">Who Sent American Jobs Away?</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image35.png" alt="" /></p>
<p>Indian middle class needs to realize that the type of aspirations they now have cannot be fulfilled without risk taking {as in starting new business / doing high risk high return investments} or world class expertise {becoming a top class doctor or engineer, not the most educated but getting the best results}.</p>
<p>As I said earlier, in India possible reasons for not making “good money” can be :</p>
<p><strong>Bad Luck</strong></p>
<p>Many people are just unlucky. Have low risk appetite. Maybe parents did not save as much, father was an alcoholic and so on, so cannot really start a business. Parents were maybe not around so had to take up any commodity job to take care of siblings. People are more constrained and much less of individuals than we think.</p>
<p><strong>Lack of Risk Taking and poor spending habits</strong></p>
<p>What has not changed is mentality of many Indians, specially many from our middle class which is still living in the socialist bubble of safe long term jobs while adopting capitalist materialistic spending habits {Basically we have inflated our expenses like in America, but still want safe and cosy jobs like Soviet Union}. One must think of what small risks can they take and grow in long turn. Missing Saturday “quality time” with friends is ok when you are trying to learn a new field which you see potential in.</p>
<p><a href="https://www.quora.com/What-do-people-who-are-more-than-45-years-old-do-after-getting-fired-from-their-job-due-to-cost-cutting/answer/Muktabh-Mayank">Muktabh Mayank’s answer to What do people who are more than 45 years old do after getting fired from their job due to cost cutting?</a></p>
<p><strong>Lack of quality white collar employees</strong></p>
<p>Many of our white collar employees still don’t know their field well. I mean try making graduation process of universities more hard work {maybe by having more practical exams} and see students sulk. Many “experts” in India are just social climbers, can do office politics well. Lack of an intellectual elite has basically convinced many Indians that being “so so” at their job is fine. So so cannot take one places. Cosy sure shot board exams and degress in name of student stress are doing no good to our society. The way to reduce student stress is to reduce stigma around failure and not just make getting a degree easy.</p>
<p><a href="https://www.quora.com/Why-has-engineering-education-become-substandard-after-the-IT-boom-Older-generation-engineers-were-really-makers-Now-nearly-half-of-the-graduates-are-unemployable/answer/Muktabh-Mayank">Muktabh Mayank’s answer to Why has engineering education become substandard after the IT boom? Older generation engineers were really makers. Now nearly half of the graduates are unemployable.</a></p>
<h3 id="q-how-can-indian-railways-be-improved-without-privatisation-and-considering-poor-peoples-budget">Q. How can Indian Railways be improved without privatisation and considering poor people’s budget?</h3>
<p>Originally answered here : https://qr.ae/pNcqwJ</p>
<p>You don’t need “privatization” necessarily, but you cannot deny that privatization works better than current state run companies for sure.</p>
<p>If we need to grow railways faster than the current rate, we need many things that privatization brings in.</p>
<ol>
<li>
<p>Ability to get asymmetric gains {social/economic} for asymmetric efforts/risks. Basically if someone works extremely hard and takes extreme risk to implement something great, they should be rewarded asymmetrically for its success. If there is no incentive to gain, no one would come out of their comfort zone and innovate. If someone tries to do something great as a “state” worker, credit will be taken by their bosses and politicians and they might not even get a raise.</p>
</li>
<li>
<p>Competition. Unless there is no competition, there is no incentive to really care about the customer if there is no fear of customer rejecting one’s business.</p>
</li>
<li>
<p>Answerability : Hardly any government employee gets fired for misdeeds and no one gets fired for working worse than expected. If you know your career is not getting a boost by working hard (point 1) and you wont be fired for working with ease, why would you ever want to change anything ?</p>
</li>
<li>
<p>Accepting change and {small} failures : It’s ok to take small initiatives for change in status quo and fail in many as long as we succeed in a few. Its related to point 1, if there are individuals on whom railways can take small initiatives and they get great rewards if successful, they would come up with many ideas which would transform the system. A more specific way can be : “employees get Rupees 1,000,000 to run a project and become CEO perpetually if they come up with a good one and they loose their job if they couldn’t make the idea work till a certain level”. However, change and small bets are both not easy to digest in a bureaucratic system. So even if a government wants to bring about change, state run organizations like railways would rather take large institutional bets like trusting a large MNC for a project {not the institution itself, Indian Railways are not building India’s HSR or hyperloop} rather than many small indigenous projects. The project would be commissioned only if there is general acceptance for change and given the resistance we are seeing to reforms in India, even such large projects will be rare. Look at the resistance to the high speed rail projects or more recently farmer reforms.</p>
</li>
</ol>
<p>So basically nudge citizens to take ambitious projects as government employees and make sure the ones who are lazy are eliminated. You can clearly see why these points would not be a very popular opinion with many people in bureaucracy. They won’t sell well politically too because deep inside, everyone wants government jobs to be chill and laxed out despite them facing the brunt of slow bureaucracy anyway, in case one day they get lucky with such a job.</p>
<p>You have to understand that railways as a government run industry is not just a welfare for poor people who want to travel {so tickets are low cost}, but also a welfare for middle class who can take easy comfortable jobs. When running a welfare state, the services will be as good as the amount of riches {wealth} in the country. So our railway system is according to our current per capita income. As per capita income rises, it will keep getting better. So you can see things happening too, I have always used Indian Railways and there has been incremental progress from the time I remember [2000 onwards]. If railway is bad according to you now, it was really really bad in say 1999, on all possible parameters.</p>
<p>It will be a collective decision if we want any state run institution to grow at a faster rate than economy and in that case we will have to stop running it as a welfare bus, at least on employee side.</p>
<h3 id="q-why-do-most-of-the-couples-nowadays-have-no-kids-or-hardly-have-at-least-one-kid-in-india-is-the-indian-economy-really-in-that-bad-situation-when-compared-to-the-rest-of-the-world">Q. Why do most of the couples nowadays have no kids or hardly have at least one kid in India? Is the Indian economy really in that bad situation when compared to the rest of the world?</h3>
<p>Originally answered here : https://qr.ae/pNJkhZ</p>
<p>The Indian economy was in much much worse shape under the British or in the timeframe of 1985–1991 when Soviet style socialism had made the whole system rotten. Indian reproduction rate was much higher then than it is today when India is actually a much richer country. So I guess that should counter the point of correlation between low reproduction rate with bad economy.</p>
<p>Also I think the 1 kid hypothesis is generally true for Indian middle class or upper comfortable middle class and not middle class and below. I am not able to find very clear stats about it, but in my observation, reproductive rate is much higher than 1 in the less economically advanced communities. Its generally the elites and businessmen and people working in formal economy who have a low birth rate. I will discuss this later, but my assumption in this question is that this premise of birth rate lower than 1 is primarily about middle class people working in formal economy.</p>
<p>In my view, the reason is that the ever growing Indian formal economy runs on meritocracy. If you want to understand meritocracy more , I had written about it in this answer : <a href="https://www.quora.com/What-will-happen-if-India-embrace-meritocracy/answer/Muktabh-Mayank">Muktabh Mayank’s answer to What will happen if India embrace meritocracy?</a></p>
<p>Meritocracy starts with selecting the best people to run organizations and projects by resorting to competition. “Competition” is actually really good for the economy, individuals and society in general as better people running projects make the system work much more smoothly. You can look at India’s growth and influence which has been increasing since it embraced meritocracy in economy in 1991. <a href="https://en.wikipedia.org/wiki/Economic_liberalisation_in_India">Economic liberalisation in India - Wikipedia</a></p>
<p>. India’s post independence top bureaucracy has always been admired because of its meritocratic nature. <a href="https://en.wikipedia.org/wiki/Union_Public_Service_Commission">Union Public Service Commission - Wikipedia</a></p>
<p>.</p>
<p><strong><em>However, due to the introduction of meritocratic competition in common economy, the work required to make oneself “good enough” and one’s kids “good enough” grows manifold. One has to work hard themself and invest much more on making kids competitive. This means that the sections of society that are in the meritocratic race, will have to concentrate their efforts into themself and a smaller family. If you want to understand who works to make India’s society and economy better, its these people making efforts and sacrifices to push themselves which aggregates as societal growth.</em></strong> There are sections of society forced to live on welfare or living in a feudal system, for whom meritocracy is not important and they will continue to stick to more innate behaviors : <a href="https://en.wikipedia.org/wiki/Instinct">Instinct - Wikipedia</a></p>
<p>. Reproducing as much as the ecosystem can bear is the innate behavior of life.</p>
<p>There is a comfort and ease in the old feudal systems, the people who do well in such systems can just chill and focus on smaller things in life life enjoying company of a large family and so on. There is a reason why people comfortable in feudal systems resist change into a meritocracy even when they know when they will have an inherent advantage in meritocracy. <a href="https://www.cnbctv18.com/agriculture/like-2020-narsimha-rao-govt-too-faced-resistance-to-1991-economic-reforms-7859651.htm">Like 2020, Narsimha Rao govt too faced resistance to 1991 economic reforms</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image36.png" alt="" /></p>
<p>With competition reaching unorganized sectors of economy, you can assume the wealth and well-being to get better there as well, but the reproductive rates would go down even in those segments so that they can focus on . I discussed this point about the disparity in birth rates earlier, the point about that was while the 1991 economic crisis suddenly forced a lot of people into going meritocratic, a lot of them were left behind and were still living in a less competitive, feudal world.</p>
<p><a href="http://indiabefore91.in/impact-reforms">Impact of reforms</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image37.png" alt="" /></p>
<h3 id="q-the-future-is-asia-why-is-india-not-joining-rcep--pivot-to-us-do-indians-really-believe-it-is-their-turn-to-be-helped-by-us-did-us-really-helped-china-or-exploited-china-for-last-few-decades">Q. The future is Asia, why is India not joining RCEP & pivot to US? Do Indians really believe it is their turn to be helped by US? Did US really helped China or exploited China for last few decades?</h3>
<p>Originally answered here: https://qr.ae/pNWmUj</p>
<p>There are just too many assumptions in the question.</p>
<ol>
<li>
<p><strong>The future is Asia :</strong> Many people would differ. I think the future is a multipolar world. Different blocks of Asia (China, ASEAN, India, GCC) will be important players going forward. However, to think there will be a common block known as Asia is not a thought I believe. ASEAN and China are very connected right now, but SE Asia will want to develop other strategic interests in future and will be forced to rise up as a separate block from China. Australia’s relationship with China is at a record low and Japan and Taiwan feel threatened by an aggressive China. Unlike Africa or Americas where nation states are arbitrary borders or Europe where they are political concepts day 0 onwards, in Asia nation states roughly correspond to civilizations. Old and perennial, these civilizations will watch out for their own separate interests always and it is hard for them to combine under a common flag</p>
</li>
<li>
<p><strong>India has pivoted to US :</strong> Yes in terms of defence alliance. China has been continuously showing aggression to India for many years now and India has willingly surrendered some territory to it. <a href="https://en.wikipedia.org/wiki/2020_China–India_skirmishes">2020 China–India skirmishes - Wikipedia</a></p>
</li>
</ol>
<p>. With Russia also having close ties with China, India has no option but to diversify its defense partners. India was unwilling and joined Quad (<a href="https://en.wikipedia.org/wiki/Quadrilateral_Security_Dialogue">Quadrilateral Security Dialogue - Wikipedia</a> ) only after Chinese actions on borders attacking and killing our soldiers. Just two hours back I read a news about China breaching borders of Bhutan, possibly the most peace loving country in the world. This alone proves to me that beingsubmissive and peace loving won’t work with China.<br />
China will keep being aggressive whatever India does because they are just driven by the doctrine of <a href="https://en.wikipedia.org/wiki/Five_Fingers_of_Tibet">Five Fingers of Tibet - Wikipedia</a></p>
<ol>
<li>. If India is submissive, that would be even more dangerous for the country’s integrity and the region’s stability. Basically in defence, India is out of options but to support any block which guards its strategic interests against China. However, India continues its friendly relationship with countries in China’s friendlist like Russia and Israel and SCO countries and ASEAN.</li>
</ol>
<p>New satellite imagery published by <a href="https://twitter.com/ndtv?ref_src=twsrc^tfw">@ndtv</a>, conclusively proves that a new village constructed by China and revealed in Chinese state media is indeed located within over 2 kilometres into Bhutan, according to their official maps and claims (27.307, 89.007).<a href="https://t.co/QVgFeuGzVS">https://t.co/QVgFeuGzVS</a> <a href="https://t.co/eaR7lTxgkG">pic.twitter.com/eaR7lTxgkG</a></p>
<p>— Nathan Ruser (@Nrg8000) <a href="https://twitter.com/Nrg8000/status/1330463914576920577?ref_src=twsrc^tfw">November 22, 2020</a></p>
<ol>
<li>
<p><strong>India has pivoted to US (continued) :</strong> But that doesn’t mean India is in a US trade block. Possibly after US and China, India is one of the only countries which has a large enough internal market, workforce and self-sufficiency to not participate in international division of labors that are crafted our by Free Trade Agreements. We are looking at our building our own profitable trade relations which preserve our existing supply chains and in parallel provide us better opportunities. RCEP has many provisions that will force many people into uncertainty and risk of poverty without significant upsides. When we get an agreement which is a good tradeoff, maybe India still joins it.</p>
</li>
<li>
<p><strong>Multilateral FTAs like RCEP are the best</strong> : No. Almost everyone agrees that its just too complex to negotiate a multilateral FTA which is a win-win. Better (and harder and slower) way is to negotiate multiple bilateral agreements. These are relatively less risky and lossy. We must probably do that.</p>
</li>
<li>
<p><strong>Indians believe we will be helped by US:</strong> Most Indians don’t trust US to stand for us. At best they like US much more than they like China (and possibly less than they like Israel or Russia). Indians trust in their ability as a civilization to be sturdy and united. History has proven that being a colony for over 1000 years has not destroyed us and we can manage hardships.</p>
</li>
<li>
<p><strong>Did US help China or exploit it ?</strong> : US helped China after Nixon till maybe Clinton somewhat strategically like it was helping India during Trump regime (we don’t know what change in US administration entails yet). But it was doing so not because of any goodness or nobility. US saw China as a counterweight to Soviet Union then as it sees India as a counterweight to China now. Let’s just agree that all countries are trying to fulfil their own self interests.</p>
</li>
</ol>
<p>TL,DR : Signing RCEP right now is not pragmatic for India. We should negotiate and if we get a good deal, maybe we can sign it. Else we should take path of signing multiple bilateral FTAs. Let’s put our foreign service to work.</p>
<h3 id="q-is-india-going-to-collapse">Q. Is India going to collapse?</h3>
<p>Originally answered here: <a href="https://qr.ae/pNJvtU">https://qr.ae/pNJvtU</a></p>
<p>What does collapse even mean ? Are you thinking about whether India will cease to exist as a nation state or civilizational state or liberal democracy or socialist country or capitalist country or what ? Its just such a broad question. The alteration of a “Status Quo” one likes is what one would call “collapse”.</p>
<p>Will India go through Phase Transitions ? Yes.</p>
<p>Will India collapse ? Not likely. The older a system is, the more flexible it is to changes and less likely it is to collapse. A newer system can die out pretty soon, the older a system is, the more capacity it has to adapt and survive. India is really old, possibly the oldest living civilization !</p>
<p>Many Indians (specially elites and middle class ones) are people averse to big changes and thus they assume any change that comes along will lead to “collapse”. After all, they are ones who have been pampered to seek rent by the ruling classes in a way that they continue thinking that status quo is “necessary”. Since middle class and elites are more vocal, you see their versions of “collapse” floating around on social media.</p>
<p>Collapse is just one out of the many possible outcomes of an phase transition in a complex system.</p>
<p>So for example, India’s communists were worried about subsidies for India’s poor becoming worse off at the time of economic liberalization in 1991, when India was coming out of its socialist past : <a href="https://www.nytimes.com/1991/06/29/world/economic-crisis-forcing-once-self-reliant-india-to-seek-aid.html">Economic Crisis Forcing Once Self-Reliant India to Seek Aid (Published 1991)</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image38.png" alt="" /></p>
<p>We are spending even more on food subsidies after we became economically more prosperous :</p>
<p><a href="https://www.thehindu.com/business/govt-subsidy-spend-on-the-rise-again/article26187273.ece">Govt. subsidy spend on the rise again</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image39.png" alt="" /></p>
<p>The fear of collapse is the fear of the loss of status quo. “Status Quo” benefits some people, they become powerful and will try to oppose any changes as they see their personal power decreasing as “collapse” of civilization. IMO, the opposition to recent agricultural reforms is precisely that : <a href="https://www.quora.com/Why-are-farmers-in-Haryana-and-Punjab-protesting/answer/Muktabh-Mayank?ch=10&share=a170d6b8&srid=qie">Muktabh Mayank’s answer to Why are farmers in Haryana and Punjab protesting?</a> .</p>
<p>India has immense economic potential, but the current economic/bureaucratic system is not the best way to realize this potential, so it would be a possibility that there are phase transitions in our economic system. Basically change in fundamentals of economy which would not support the the current ways in which the economy works. The people know that the status quo needs to change, that is why the powerful democratic mandates they has been giving to our leaders. PM Modi, KCR, Kejriwal win by massive majorities to change the status quo, compare it to just 10 20 years back when we had “revolving door” governments. Of course the people who are at an advantage now will resist and create a hue and cry over changes, calling them collapse.</p>
<p>Phase Transitions are risk, so is not going through changes ! We are lucky that Indian people are willing to accept change. This actually makes sure India will not collapse due to social entropy. More about social entropy here : <a href="https://www.quora.com/Will-the-5G-internet-make-this-world-a-chaotic-place/answer/Muktabh-Mayank">Muktabh Mayank’s answer to Will the 5G internet make this world a chaotic place?</a></p>
<h3 id="q-if-india-bans-all-private-cryptocurrencies-and-introduces-a-single-official-digital-currency-issued-by-the-rbi-how-will-it-affect-the-economy-of-india">Q. If India bans all private cryptocurrencies and introduces a single official digital currency issued by the RBI, how will it affect the economy of India?</h3>
<p>Originally answered here: <a href="https://qr.ae/pNzj8e">https://qr.ae/pNzj8e</a></p>
<p>There is some misplaced sense of bureaucratic logic that is driving this initiative. RBI tried to ban other cryptocurrencies while launching its own crypto and when that was struck down this has been sent to the parliament. I hope our government and members of parliament understand that CBDCs [Central Bank Digital Cryptocurrencies] and decentralized cryptocurrencies have two very different applications and banning the later is not required to get a market for the former. The competitors for CBDCs are international centralized coins like Libra {Now called <a href="https://www.diem.com/en-us/">The Diem Association</a></p>
<p>}, other upcoming CBDCs like China’s and EU’s and not Bitcoin/Ethereum and its brothers. We are fighting the wrong monster here.</p>
<p><strong>CBDCs usecases :</strong></p>
<p>The top benefits of a CBDC are :</p>
<ol>
<li>
<p>Quicker disbursement of government financial aid/UBI. While right now RBI prints currencies, sends to government/banks and banks then disburse the money, A CBDC can be minted and disbursed almost immediately after decision is made. A few years back, when this disbursal was done through cash, there was a lot of corruption and even more delay which fintech has already solved, now CBDC when combined with fintech would make the process instantaneous .</p>
</li>
<li>
<p>Tracking flow of money is another cool thing about CBDCs. While for most citizens the CBDC ledger is anonymous, the government accounts will be public and people can see where there tax money have been spent down to one rupee. This ensures certain types of corrupt practices will be much easier to detect and highlight. In a way good step to check public sector corruption.</p>
</li>
<li>
<p>Indians are already accustomed to digital currency [You have amazon wallet cash, paytm wallet cash] and so on. While right now, this cash is guaranteed by the companies, CBDC as a digital cash will be guaranteed by the government. These are two very different type of guarantees. Sudden nationalization of AliPay for example makes a lot of AliPay guaranteed digital money of SouthEast Asian and African businesses using AliPay, Chinese government guaranteed money. Not sure how comfortable people would be wit that, but private companies are under umbrella of the countries they have their effective center of control in.</p>
</li>
</ol>
<p><strong>This is in total contrast with how decentralized cryptocurrencies [like Bitcoin] are being used in today’s day and age:</strong></p>
<p>A. Decentralized Cryptocurrencies are emerging as a hedge against poor monetary practices of a government. When a government is printing money like newspaper, people need ways to preserve their wealth and not need to depend upon other governments for their currencies and CBDCs. That is what main usage of Bitcoin is in current day. Bitcoin/Ethereum is not really useful for transactions because of the slow nature of transactions.</p>
<p>B. The other prominent usage of decentralized cryptocurrency is as a vehicle currency, that is way to send money abroad without all the charges involved today. This is possibly the use that government officers might be worried about and rightly so due to security concerns. There should be strict ways to regulate the improper money transfers but in my view banning decentralized cryptocurrencies over this is a bit over the top.</p>
<p>One more concern over decentralized cryptocurrencies is that people can be conned and can lose their savings over bad explanations of the new concept of currency in software.</p>
<p>All in all, I see CBDCs and Decentralized cryptocurrencies operating in parallel without disrupting each other.</p>
<h3 id="q-will-the-privatization-of-banks-solve-or-complicate-the-problem">Q. Will the privatization of banks solve or complicate the problem?</h3>
<p><a href="">https://qr.ae/pGXEUJ</a></p>
<p>“Privatization” is a very broad phenomenon and if we discuss it as opposite to “Nationalization” that happened in 1969, we are just thinking quite badly. Privatization is not going to be the reverse of what happened in 1969, it cannot be. You cannot reverse 50 years of change !</p>
<p>Unfortunately, that is the emotional “flight or fright response” that would come to the stakeholders and they would go in war mode to protect status quo they are accustomed to. On the other end of the spectrum are “free market” zealots who just want to offload everything of government’s hands without understanding the long term implications.</p>
<p>We need to understand that there are pragmatic decisions that can help everyone in long run. Of course, there are people who have built moats and arbitrage on current status quo and they would be worried as their advantages are ripe for disruption. For others, a lot of the apprehension is just fear of change, the people getting disrupted will make sure they fan this fear to get a political victim group.</p>
<p>We need to ponder about many points :</p>
<ol>
<li>
<p>What is the current role of different public sector banks ? What needs to be in public sector and what doesn’t ?</p>
</li>
<li>
<p>Are all public sector banks doing like they are expected to do ? Shouldn’t their working structure change if they don’t ?</p>
</li>
<li>
<p>Whose control are the public sector banks under after they were so called “Nationalized” ?</p>
</li>
<li>
<p>Whose control the banks would pass to if they are “Privatized” ? Are they under more scrutiny now or will they be if their stocks were traded like Reliance’s and HDFC banks are ? Or will be the banks be sold to strategic buyers for high valuations ? Unlike what many people think, privatization is not always things becoming out of control of country’s citizens.</p>
</li>
<li>
<p>Why are the public servants so afraid of shifting to private sector ?</p>
</li>
</ol>
<p>Some pondering points based on above question :</p>
<ul>
<li>
<p>I don’t think the government is going to just loose control of all banks. That would just not work with the institution of government itself. The exercise is to get rid of the fat, the banks which perform badly and have no hope of redemption.</p>
</li>
<li>
<p>The welfare schemes [access to free banking and money transfers] need to continue to keep the society content and private banks won’t be interested. So just to keep the country running smoothly, there will be need of institutions secured by taxpayer money. I guess these 2 points would convince you that we are not going to see a reversal of 1969, its just going to be restructuring according to new times.</p>
</li>
<li>
<p>But here is a question : if welfare banking is taken care of by some efficient government run banking institutions [easy access to banks in remote areas, zero balance accounts, cash transfers/UBI], does the government need to run most/all retail banking in the country ? Specially when government has put regulations making sure even the privately run banks have to participate in many welfare banking schemes ? Do you really think that all public sector banks are competing on basis of their services with other banks ? There are few very well run public sectors banks, but majority of these banks are just existing because taxpayer is bound to let them live. The ones working well should take up welfare banking and the ones who are just surviving should face market competition to become better. Remember more competition is always better for consumers. Taxpayer cannot fund loss making assets forever, which are not just a direct sink of taxpayer money but might also distort the market by producing wrong incentives by taxpayer money.</p>
</li>
<li>
<p>Another very important emotion that somehow is pumped into people is that “Nationalized” banks are somehow under their control and all “Privatized” banks are controlled by some outsider entity. Its such a bad generalization and tells about financial literacy of the country. They need to understand that most “Privatized” banks are “Public” companies and are in much better scrutiny of common people than bureaucrats running public sector banks without any fear of consequences and any incentive of making it big. Being a publically traded company in India ensures that banks are facing market competition, being trusted by people and are still under Indian laws. Most Indians need to realize that these public companies [LIC is to one become soon] are what pays them the high interests on fixed deposits and PPFs and banks anyway indirectly invest into these. The equating of Indian Public companies [HDFC, Reliance, Infosys, TCS] with East India company has damaged an average Indian’s financial literacy a lot, we need to stop that. As long as there is a democratic government making laws on finance and trading to make sure people’s concerns are taken care of, public companies are efficient public sector companies only. This doesn’t mean that there would be no NPAs and no scams in private banks, but we will definitely address them faster and management would be much more mindful of such things happening.</p>
</li>
<li>
<p>There would be some strategic sales for bank privatization too. This is possibly what people fear and imagine all privatization looks like. Selling to business houses. Its a battle of top 0.1% and top 1% and commoners like us just spectators here. All we can understand is as long as government can force the buyers to be controlled and scrutinized by Indian public, we are fine. One way is to force to keep existing people as employees, making sure the buyers cannot use the income from such banks to diversify outside India and so on. If the new elites interests are tied to Indian people, we are going to be fine. The way to use capitalism to our benefit is “<em>interest alignment”.</em> Always look at the terms of sale and not the cumulative amount the bank sales made. [Emotional people would often think a sale at a higher amount is always better].<a href="">https://www.sapling.com/5991158/interest-alignment</a></p>
</li>
<li>
<p>Indians need to stop thinking about economics with simple perspectives like “privatization is bad”, “nationalization is bad”, “all foreign money is bad” and learn to use capitalism to our benefit. Pure ideology is almost always impratical. Interest alignment, Matthew’s Principle and risk evaluation is the way. Also we need to stop offloading our economics thinking to “experts” without understanding their core beliefs and affiliations.</p>
</li>
</ul>
<!-- end list -->
<ul>
<li>One thing is about the employees of public sector banks. We have to understand why they don’t want to work in a private institution. Is it because of “lack of security in private institution” or “lack of responsibility for actions”. This is a line that the elected government is made to draw. They cannot let people be exploited but cannot let people take undue advantage of their position as well.</li>
</ul>
<p><strong><em>Some more thoughts of mine you might want to read in this context :</em></strong></p>
<p>Why some privatization without losing control is important :</p>
<h3 id="q-if-the-indian-government-privatizes-all-jobs-and-advanced-technology-takes-over-all-paper-work-and-manual-labour-how-are-the-middle-class-and-poor-going-to-survive">Q. If the Indian government privatizes all jobs and advanced technology takes over all paper work and manual labour, how are the middle class and poor going to survive?</h3>
<p><a href="">https://qr.ae/pNdRa8</a></p>
<p>There are some basic assumptions in the question which are all wrong :</p>
<ol>
<li>
<p>Government can privatize all jobs.</p>
</li>
<li>
<p>Government running all economic sectors and all jobs as government jobs is feasible and scalable.</p>
</li>
<li>
<p>Manual Labor and paperwork are the jobs which middle class and poor class can do.</p>
</li>
<li>
<p>Automation makes the number of jobs zero.</p>
</li>
<li>
<p>Survival needs a job.</p>
</li>
</ol>
<p>People are driven by fear. It is a very powerful emotion. People would look at today’s circumstances for negatives and will guess a few negatives of new reforms and combine both to imagine a horrible future. This question is addressing a fear the possibility of which coming true is very low. Remember half of the world doesn’t sit static while the other half changes, society and economics is a thriving self-repairing ecosystem. Things work out in favour of those who take risks, not those who avoid them due to fear. One cannot help the feeling of fear though, the amount of negativity in main stream media and social media keeps making people imagine unrealistically bad scenarios which are not possible. I mean look at the way they tried to sensationalize India’s possible COVID scenario :</p>
<p>Remembering Dr. Ramanan Lakshminarayanan who had extrapolated a statistical model of 300 million Covid cases and 3 Million deaths in India by August 2020. Goes to show how much GAS is being telecast on Indian News TV with 0 accountability.</p>
<p>— Trendulkar (@Trendulkar) <a href="https://twitter.com/Trendulkar/status/1366437556015927300?ref_src=twsrc^tfw">March 1, 2021</a></p>
<p>It turns out things were waaaay better than this in August. Most negative things you are made afraid of before they start rolling out a new change can be checked much before they become true, so there is no need to nip progress in the bud due to a 1% negative possibility. “Let a phenomenon become a problem before you start opposing it.”</p>
<p>Let’s talk about your assumptions one by one :</p>
<p><strong>Government can privatize all jobs :</strong></p>
<p>They cannot. There are some people that the government will need to employ on their roll. These jobs are elected officials, bureaucrats to negotiate on part of people, industries and scientific institutes which cannot really run without government’s backing [like say Nuclear Industry, Agriculture and Medical research, Some amount of healthcare or Defense Research]. But do you really want government hiring people for running airports or running malls or running zoos or running schools ? I discuss that in the next answer.</p>
<p><strong>Government running all economic sectors and all jobs as government jobs is feasible and scalable :</strong></p>
<p>Don’t you think most government jobs in service sectors are more of a way to please people than actually address demands :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image40.jpeg" alt="" /></p>
<p>The comfort and stability and freedom to do nothing in public sector jobs [for which most Indians are attracted to them] are essentially the reasons why the services public sector companies provide is poorer. You don’t need to worry about demand if taxpayer is backing you.</p>
<p>Government entering into services and mass employment sectors like real estate, banking etc is generally a recipe for disaster. Most Indian public banks were doing really bad until massive restructuring in their management has been started recently. The reason is simple, government jobs can seldom provide the incentives private sector employments can provide. One way is to basically simulate private sector like incentives/accountability in public sector jobs :</p>
<p><a href="">https://www.quora.com/How-can-Indian-Railways-be-improved-without-privatisation-and-considering-poor-peoples-budget/answer/Muktabh-Mayank</a></p>
<p>However, pulling off such a thing is hard in democracy, where effectively jobs are a way to setup comfortable cushy salaries for supporters. That is why privatization is needed. If public can accept such changes in structure of government jobs, we can indeed live with lots of public service jobs. Try a referendum among government servants and aspirants with the changes I suggest in linked above answer and see !</p>
<p>China has done “exposing public sector jobs to market forces” like I suggest in linked answer above and has succeeded. Maybe because they are not a democracy. So has Singapore, by being much less democratic than you see. Most examples of paradigm shifts in democracies have come from risks being taken in private sector.</p>
<p><a href="">https://www.quora.com/Is-it-the-business-of-government-to-run-business/answer/Muktabh-Mayank</a></p>
<p>It might sound like I am saying that private business ownerships should be no strings attached and unregulated. That is not what I mean. Private sector companies should be allowed to take profit only if they are not making country less competitive {just like comfort of no market pressure in government jobs makes public sector enterprises less competitive, similarly companies making profit by making the country venerable to risks make the economy weak in the long run too}.</p>
<p><a href="">https://www.quora.com/Why-isnt-Trickle-Down-economics-working/answer/Muktabh-Mayank</a></p>
<p>The answer is to have private companies which stay competitive and the effective center of control is with the people. Fear of leaving comfort zone makes humans demand the opposite : safe public sector jobs and private companies that can make profits at any cost.</p>
<p><strong>Manual Labor and paperwork are the jobs which middle class and poor class can do.</strong></p>
<p>Why so ? There are many many jobs that don’t exist in our country as much as it should. Why should lower middle class people be just clerks and poor people laborers at construction and farms ? Cannot more opportunities open up for them ? Percentage of poor people could be reduced in population just like China or US did in 20th and 19th century respectively. Middle class would become the majority eventually if economy grows fast. People could be technicians at automated factories, looking after data center farms, healthcare professionals [which India has much less than required due to gatekeeping] or do more dignified work like running construction and farm machinery rather than doing back breaking work.</p>
<p>How simple to think that the efficiency privatization introduces into the economy doesn’t lead into any growth and evolution of economy. Jobs will get partially automated [not fully], reducing the number of jobs per institution, but total number of institutions will rise as well maybe even creating an excess of jobs. Also, a richer economy will create more and more sectors. People won’t be forced to work the same jobs as today when economy grows, at least not in same percentage of population. Automation has been around for a very long time and number of jobs has been growing.</p>
<p><a href="">https://www.quora.com/As-a-result-of-the-Fourth-Industrial-Revolution-will-any-job-be-lost/answer/Muktabh-Mayank</a></p>
<p><strong>Automation makes the number of jobs zero</strong></p>
<p>Due to some reason [Hollywood movies or MSM descriptions or whatever], people believe in the false story that one day they will wake up and go their workspace where a robot would have replaced than and they would be given a pink slip. That makes a terrific story and can be made into a hit movie, but its not really true. Automation will not spread like CoronaVirus. It takes investment and deployment and time. Enough time to make one aware and reeducate oneself for a new job. All we need is people not living under rocks.</p>
<p><a href="">https://www.quora.com/Should-doctors-be-replaced-by-artificial-intelligence-and-surgical-robots/answer/Muktabh-Mayank</a></p>
<p>The world can course correct. If something goes wrong with automation, there is enough time to think and make a strategy around how to address it. Even for fast spreading things like CoronaVirus, the world went into lockdown and slowly figured out ways to respond. Automation comes much more slowly and we have compensated for it many times. Just that in past, it took a few generations and now its faster within timeframe of one generation. Most of the people joining the workforce in recent years should be aware that they would need to retrain for at least one new jobs in their lifetime. But that doesn’t mean there would be no jobs, just different ones.</p>
<p><strong>Survival needs a job</strong></p>
<p>One can ask what if the rate of progress becomes so fast that one would not be able to reeducate for new work ? First of all that is a few centuries away, but if this type of a situation arises, it is a good scenario. I think we would have solved problems around poverty and cancer and death by the time we achieve this. The entire thought and philosophy of humanity would be different at this juncture. [We might not even reach there if we choke our ecosystem with CO2 or burn our food and freshwater by global warming]. Such scenario is so far fetched and away in future that we cannot imagine it and thus can portray it in whatever way we want :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image41.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image42.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image43.png" alt="" /></p>
<p>We don’t have the ability to imagine economics exactly at such intergalactic scales. We can just guess. In my opinion, jobs won’t even be an issue by then or maybe we will have jobs that we cannot imagine : warmhole destroyer, star miners or whatever. I prefer not to worry about such scenarios right now.</p>
<h3 id="q-should-the-purchasing-limit-be-imposed-in-india-based-on-requirements-to-control-inflation">Q. Should the purchasing limit be imposed in India based on requirements to control inflation?</h3>
<p><a href="">https://qr.ae/pGvtHv</a></p>
<p>No !! Inflation in India is at a very decent level. You drive it below the current trend of 5–6 % and you are basically stopping infrastructure development and welfare activities. Esp. during COVID times, its very important to have some UBI during lockdowns.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image44.png" alt="" /></p>
<p>Ref: <a href="">https://tradingeconomics.com/india/inflation-cpi</a></p>
<p>You need some infrastructure projects and welfare programs in a rapidly growing economy. They will require government to generate some cash as debt {Most inflation in a growing economy comes from here}. In a growing economy, while some people would rapidly grow [because they are the right place at right time], others might slack off or be left behind and need to be kept in the race by supporting them a bit.</p>
<p>Having no [<2–3% i India] inflation in a growing economy is somewhat like having high inflation[8-10%+ in India]. It just creates unnecessary pressure where none needs to exist.</p>
<h3 id="q-should-uttar-pradesh-be-divided-into-four-parts-for-development">Q. Should Uttar Pradesh be divided into four parts for development?</h3>
<p><a href="">https://qr.ae/pNQxeO</a></p>
<p>I used to buy the “small states for better development” hypothesis, but overtime I have developed a more neutral outlook towards it. Smaller states have more homogeneity (and thus they are more efficient), but they have their limits and cannot do better after a certain level. Singapore developed much faster than China and is a great and efficient country, but once China took Singapore’s tricks and scaled them, its a behemoth. There is effectively no limit to what China can do, while Singapore can at best be a rich city.</p>
<p><strong>UP during the 1990s and 2000s :</strong></p>
<p>I think the reason for the “state division” hypothesis [in days of its popularity] was, its very hard to make a lot of people agree to decisions, so lets make the round table smaller and be efficient. That has been the case with UP in past, its huge and basically so chaotic that we have been seeing suboptimal progress. There was a conspicuous political movement in east UP [I know much more about east UP than the west] to achieve statehood as Purvanchal and recognition of our language Bhojpuri in Indian constitution. Bhojpuri of east UP is as far from Khadi Boli [official Hindi] as say Marwari is in Rajasthan or Haryanvi is. Everyone in east UP speaks official Hindi though.</p>
<p><a href="https://www.rediff.com/news/2008/aug/28hyd.htm">Parties fighting for smaller state band together</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image45.png" alt="" /></p>
<p>The 1990s-2000s were horrible. While the rest of the country was rallying in post 1991 economic liberalization boom : <a href="https://en.wikipedia.org/wiki/Economic_liberalisation_in_India">Economic liberalisation in India - Wikipedia</a></p>
<p>, parts of UP [I know much better about east UP] were still stuck in the 1980s. No infrastructure investment, crime and lower purchasing power with respect to rest of the country was the norm. Government servants {for nationalized industries in east UP which were the only source of employment} were being paid with 4th pay commission [that’s socialist economy numbers proposed in 1980s during the high inflation years of late 2000s] .</p>
<p><a href="http://www.cgspublicationindia.com/4th_Pay_Commission.aspx">4th Pay Commission</a></p>
<p><a href="https://www.statbureau.org/en/india/inflation/2008">India Inflation Rate in 2008</a></p>
<p><a href="https://www.statbureau.org/en/india/inflation/2009">India Inflation Rate in 2009</a></p>
<p>There were days with power for 4–5 hours in tier 3 cities {so worse in towns and villages} . I have clear memories of solving Maths problems from Hall and Knight after I competed high school in earthen lamp like this in 2006 on a summer evening when temperature was over 40 :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image46.jpeg" alt="" /></p>
<p>East UP during the 2000s felt as if the nation had left it behind :</p>
<p><a href="https://www.sfgate.com/opinion/article/The-India-Bush-didn-t-see-The-nation-s-2502576.php">The India Bush didn’t see / The nation’s liberated economy – portrayed by globalization forces as an antidote to poverty – has done little for nearly 300 million poor people, the most of any country</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image47.png" alt="" /></p>
<p>The Oxygen delivery mentioned in the above 2008 article is for the Japanese Encephalitis endemic that used to kill 100s and sometime 1000s of children every year. The only time the national media found it interesting was when children died due to a scandal in 2017, actually making a spicy headline : <a href="https://www.thehindu.com/sci-tech/health/japanese-encephalitis-a-deadly-disease-explained/article19486806.ece">Japanese Encephalitis in Gorakhpur: A deadly disease explained</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image48.png" alt="" /></p>
<p>The only infrastructure project my city had during entirety of my childhood [a flyover connecting the two parts of my town] was started when I was a kid in 1995 and was competed after I finished my high school in 2004. A supposedly upper middle class person [father an Engineer in public sector] from east UP had to apply for merit cum needs scholarship in an all India university and the college staff refused to believe the salary numbers in the first application. We were massively capital starved and thus there were no local jobs, no industries and the region was filled with dog-eat-dog crime. All the stereotypes of UP you see in the media “Mirzapur”, “Rangbaaz” were actual stories from this era.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image49.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image50.jpeg" alt="" /></p>
<p>We had the entire “bhaiya” culture from east UP of people migrating as cheap laborers elsewhere, specially in metro cities and Punjab. This damaged poor people’s incomes in those parts :</p>
<p><a href="https://frontline.thehindu.com/the-nation/punjab-land-struggle-in-the-time-of-pandemic/article32024163.ece">Punjab: Land struggle in the time of pandemic</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image51.png" alt="" /></p>
<p>and there was a wave of anti-immigrant politics against people from east UP:</p>
<p><a href="https://en.wikipedia.org/wiki/Raj_Thackeray">Raj Thackeray - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image52.png" alt="" /></p>
<p>Needless to say, people in east UP were pissed and thought maybe a separate state would get them some boost. That has however changed in 2010s though.</p>
<p><strong>UP in the 2010s and early 2020s</strong></p>
<p>Development of remote parts of UP suddenly became electorally much more important in 2010s due to its political strength. In just last 5–6 years, my hometown which took years to build 1 flyover has transformed its infrastructure.</p>
<p>Varanasi has an inland port :</p>
<p><a href="https://en.wikipedia.org/wiki/Varanasi_Multi-Modal_Terminal">Varanasi Multi-Modal Terminal - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image53.png" alt="" /></p>
<p>There is an AIIMS and Virology center for Encephalitis problem:</p>
<p><a href="https://rmrcgkp.icmr.org.in/">Regional Medical Research Center Gorakhpur (RMRC Gorakhpur)</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image54.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/All_India_Institute_of_Medical_Sciences,_Gorakhpur">All India Institute of Medical Sciences, Gorakhpur - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image55.png" alt="" /></p>
<p>And Japanese Encephalitis endemic is almost dead :</p>
<p><a href="https://www.financialexpress.com/india-news/big-shout-out-to-uttar-pradesh-government-unicef-lauds-cm-adityanaths-dastak-campaign-against-japanese-encephalitis/1147716/">‘Big shout out to Uttar Pradesh government’, UNICEF lauds CM Adityanath’s DASTAK campaign against Japanese Encephalitis</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image56.png" alt="" /></p>
<p>Many new industries have become operational :</p>
<p><a href="https://www.chinimandi.com/53-sugar-mills-still-operating-in-uttar-pradesh-state-heading-towards-record-sugar-production/">53 sugar mills still operating in Uttar Pradesh; state heading towards record sugar production - ChiniMandi</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image57.png" alt="" /></p>
<p>Sugar industry was UP’s largest employer pre-independence , but the industry was almost dead a decade back :</p>
<table>
<tbody>
<tr>
<td>[Sugar bowl loses its sweetness</td>
<td>India News - Times of India](https://timesofindia.indiatimes.com/india/sugar-bowl-loses-its-sweetness/articleshow/11816162.cms)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image58.png" alt="" /></p>
<p><a href="https://economictimes.indiatimes.com/industry/indl-goods/svs/chem-/-fertilisers/india-to-invest-rs-50000-crore-to-revive-four-mothballed-fertilizer-plants/articleshow/58403537.cms?from=mdr">India to invest Rs 50,000 crore to revive four mothballed fertilizer plants</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image59.png" alt="" /></p>
<p>There are new airports and expressways :</p>
<p><a href="https://www.msn.com/en-in/news/other/ayodhya-is-all-set-to-get-an-international-airport-soon-centre-allocates-rs-1000-cr-for-it/ar-BB1e2PeD">Ayodhya Is All Set To Get An International Airport Soon, Centre Allocates Rs 1,000 Cr For It</a></p>
<p><a href="https://www.msn.com/en-in/news/other/kushinagar-gets-dgca-clearance-becomes-third-international-airport-in-up/ar-BB1dVZIR">Kushinagar gets DGCA clearance, becomes third international airport in UP</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image60.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image61.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/Purvanchal_Expressway">Purvanchal Expressway - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image62.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/Bundelkhand_Expressway">Bundelkhand Expressway - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image63.png" alt="" /></p>
<p>I was only talking of relatively poorer parts of UP above. West UP, which was already more prosperous than east, is getting infrastructure projects which are possibly best in the country :</p>
<p><a href="https://www.financialexpress.com/infrastructure/roadways/delhi-meerut-expressway-pm-modi-inauguration-highway-facts-images-map-highlights/1182895/">Delhi-Meerut Expressway: PM Modi inaugurates India’s first 14-lane highway; 7 facts that make it stand out</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image64.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/Delhi–Meerut_Regional_Rapid_Transit_System">Delhi–Meerut Regional Rapid Transit System - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image65.png" alt="" /></p>
<p>It seems that western UP will become the employment destination rather than going to metro or gulf countries :</p>
<p><a href="https://www.newindianexpress.com/nation/2020/sep/22/up-film-city-to-come-up-in-1000-acres-land-along-yamuna-expressway-2200472.html">UP Film City to come up in 1,000-acres land along Yamuna Expressway</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image66.png" alt="" /></p>
<p><a href="https://news.samsung.com/in/samsung-inaugurates-worlds-largest-mobile-factory-in-india">Samsung Inaugurates World’s Largest Mobile Factory in India; Honourable Prime Minister Shri Narendra Modi Flags-off ‘Make for the World’</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image67.png" alt="" /></p>
<p>All the latest Samsung phones purchased in our family [including my M series], has been “Made in Noida”. There are also many new huge investments announced in west UP :</p>
<p><a href="https://economictimes.indiatimes.com/industry/services/property-/-cstruction/adani-group-to-invest-rs-2500-crore-in-setting-up-a-data-centre-says-noida-authority/articleshow/81185744.cms">Adani group to invest Rs 2,500 crore in setting up a data centre, says Noida authority</a></p>
<p><a href="https://www.datacenterdynamics.com/en/news/reliance-jio-planning-950-million-data-center-campus-uttar-pradesh/">Reliance Jio planning $950 million data center campus in Uttar Pradesh</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image68.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image69.png" alt="" /></p>
<p><a href="https://www.timesnownews.com/business-economy/companies/article/ikea-to-invest-rs-5500-crore-in-noida-signs-mou-with-up-govt/722373">IKEA to invest Rs 5,500 crore in Noida, signs MoU with UP govt</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image70.png" alt="" /></p>
<p><a href="https://www.ndtv.com/india-news/german-shoe-company-shifts-manufacturing-to-agra-from-china-amid-covid-2321742">German Shoe Brand Von Wellx Moves Out Of China, Begins Operations In Agra</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image71.png" alt="" /></p>
<p><a href="https://www.msn.com/en-in/news/other/uttar-pradesh-a-priority-state-for-australian-investment-envoy/ar-BB1e1LQV">Uttar Pradesh a priority state for Australian investment: Envoy</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image72.png" alt="" /></p>
<p>If you are observing, these were not the things UP was known for in the past.</p>
<p><strong>UP has better bargaining power and larger market when it stays united at cost of efficiency like in smaller states, but more centralized power can counter that</strong></p>
<p>I guess at least perceptually, the state is doing much better and that gives a glimmer of hope that we maybe can be the Texas/California [or a more relevant example should be Ontario] in India.</p>
<p>In my view, UP has received massive benefits due to insane political power it has wielded recently by voting full majority governments at center and state level. 2014, 2019 general elections and 2007, 2012 and 2017 elections have all been massive landslides giving governments massive decision making powers. Basically UP has experimented with given absolute powers to governments because people were sick of all the chaos caused by fractured mandates and interest-group politics. And that seems to be working well for the state. I don’t think people in UP would want to change that.</p>
<p>Uttarakhand is a state with very good per capita income, but can it be as successful / influential if UP has a similar per capita income in the future ? I don’t think so. Its quite a recognized phenomenon, its even mentioned in the bible : <a href="https://en.wikipedia.org/wiki/Matthew_effect">Matthew effect - Wikipedia</a></p>
<p>. What UP needed was some centralization and push from absolute chaos, now that has been achieved, in my opinion, dividing the state is redundant.</p>
<p>Also, there are stereotypes about UP in many answers to this question and comments among them like east UP and Bundelkhand are some brutes who cannot manage themselves and UP is cultureless hellhole that needs a culture reset. Let me remind them that other areas that had been colonized by foreigners [Turks, Afghans, Iranians, British] for an equivalent period of time in India are now Pakistan and Bangladesh, basically not even a part of India. UP has something super solid about it, we got poor under foreign occupation as we funded their armies and conquests and filled their coffers but psychologically we are still following the heroes who lived and roamed here millenia ago and the world follows them too.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image73.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image74.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image75.jpeg" alt="" /></p>
<p>Even after independence, our industrial base was choked due to the politics of getting divided into factions :</p>
<p><em>Pre independence :</em></p>
<p><a href="https://www.yourarticlelibrary.com/industries/cotton-textile-industry-in-india-production-growth-and-problems/19704">Cotton Textile Industry in India : Production, Growth and Problems</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image76.png" alt="" /></p>
<p><em>Post Independence:</em></p>
<p><a href="https://thewire.in/labour/faulty-govt-policies-corruption-and-exploitation-of-labour-how-the-once-flourishing-kanpur-textile-mills-decayed">How the Once Flourishing Kanpur Textile Mills Decayed</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image77.png" alt="" /></p>
<p>I hope people of UP have learnt their lessons :</p>
<p><a href="https://www.quora.com/Is-a-middle-class-person-really-affected-by-whoever-that-comes-in-power-in-India-or-whoever-comes-Is-it-still-the-same-thing-just-with-a-different-name-tag/answer/Muktabh-Mayank">Muktabh Mayank’s answer to Is a middle class person really affected by whoever that comes in power in India or whoever comes? Is it still the same thing just with a different name tag?</a></p>
<p>We have had many poor generations and lost historical documents, but there is no question about the hindi heartland [UP and Bihar] is what Greece and Rome are for the European civilization. Pataliputra and Mathura were seats of powers that Greeks and Romans respected and traded with once. <a href="https://en.wikipedia.org/wiki/Gangaridai">Gangaridai - Wikipedia</a></p>
<p><a href="https://www.quora.com/Is-it-true-the-name-India-didnt-exist-before-1857-it-was-given-by-the-British-to-replace-the-previously-used-word-Subcontinent-or-Bar-e-Sagheer/answer/Muktabh-Mayank">Muktabh Mayank’s answer to Is it true the name “India” didn’t exist before 1857, it was given by the British to replace the previously used word “Subcontinent” or Bar e Sagheer?</a></p>
<p>UP is truly, a sleeping giant. Once it rises again, it could be the Texas/California/Ontario of India. Harit Pradesh or Purvanchal would become just another Goa or Telangana. Both are fine circumstances for people in UP as long as India is developed, independent and prosperous country, but if you ask me, I prefer former to the latter. Other people of UP would think so to if they reason the way I do.</p>
<h3 id="q-how-did-y2k-prove-to-be-a-boon-for-the-indian-economy">Q. How did Y2K prove to be a boon for the Indian economy?</h3>
<p><a href="">https://qr.ae/pGvtoC</a></p>
<p>Indian IT firms suddenly got a platform, exposure and trust to attract most international institutions. Now mind you Indian IT firms were around for sometime, but there was a hesitation in outsourcing whole or part of IT tasks.</p>
<p>But with the Y2K fear suddenly being realized {Many companies realized it as late as 1998 that their programs might be denoting years as YY ans not YYYY and thus might fail on 1/1/2000}, too much work came up to be done before year 2000 for not outsourcing.</p>
<p><a href="">https://en.wikipedia.org/wiki/Year_2000_problem</a></p>
<p>The work was comparatively less in writing subparts of programs with YYYY format, but as usual like in Computer Science there were too many abstractions and one could never know what errors new changes would introduce. In areas like defense, banks, finance, healthcare, insurance, telephones etc such errors would be a big deal.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-12-25-Thoughts-on-Indian-Perennial-Economic-Topics/media/image78.png" alt="" /></p>
<p>So US companies had to look outside, were forced to look outside and that is where Indian IT firms got headways into departments and institutions they had never been able to set foot in. What Indian firms had to do was provide good services which cheap prices and that they did.</p>
<p>Soon many board rooms were discussing outsourcing their IT.</p>
<p>As someone has rightly said. “Learn to survive until you get lucky !”</p>My thoughts on some perennial economic topics of India :Thoughts On Recent Indian Economics And Politics 2019 To 20212020-11-30T00:00:00-06:002020-11-30T00:00:00-06:00https://muktabh.xyz/2020/11/30/Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021<p>I am hereby summarizing some thoughts on contemporary Indian politics and economics [2019-2021].</p>
<ol>
<li>
<h2 id="2021-covid-second-wave-">2021 COVID Second Wave :</h2>
<ol>
<li>
<h3 id="my-answer-to-the-government-has-announced-vaccination-for-18-above-starting-from-1st-may-but-still-very-few-able-to-book-the-vaccination-why-is-that">My answer to “The government has announced vaccination for 18 above starting from 1st May, but still very few able to book the vaccination. Why is that?”</h3>
</li>
</ol>
</li>
</ol>
<p>Originally answered here : https://qr.ae/pGh3Kz</p>
<p><strong><em>Supply-Demand imbalance.</em></strong></p>
<p><strong>Supply Side</strong></p>
<p>Vaccine supply is not trivial. You have the following :</p>
<ul>
<li>
<blockquote>
<p>Investment cost to have each incremental pipeline of 100,000 vials/day per day.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>More importantly there is a theoretical limit of the possible machinery or HR we could use for vaccine production. You cannot really train millions of people to work on vaccine production overnight I guess. You can increase production capacity by a few million per day, but what if you want to make vaccine production 100X in one day. Do you have as much machinery available to put into place ? Vaccine making machinery is not like soap a product which can be infinitely [in figurative sense, not literal[] procured.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>If you invest into vaccine production today, there is a lag by the time factory gets ready and people start working. Only then you would see the returns.</p>
</blockquote>
</li>
</ul>
<p>So while investment is being poured into vaccine production, it would take time for it to ramp up :</p>
<p>https://timesofindia.indiatimes.com/business/india-business/finance-minister-approves-advance-payment-of-rs-4567-crore-to-serum-institute-of-india-bharat-biotech/articleshow/82149322.cms</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image1.png" alt="" /></p>
<p>I assume it will take a few months before this investment fructifies and increases supply. Ok, just saw this :</p>
<p>https://www.msn.com/en-in/money/other/sii-ceo-adar-poonawalla-100-million-doses-per-month-from-july-exclusive-interviews-cnbc-tv18/vi-BB1fTp9z</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image2.png" alt="" /></p>
<p><strong>Demand Side</strong></p>
<p>Now that we have seen supply side, lets look at the demand side. Demand of such situations like we have today is what we call “surge demand”. All 1.3 Billion people of the country want to get vaccinated immediately or as soon as possible. Its like everyone is trying to come out of DLF cybercity in the evening and there is just one Uber cab available.</p>
<p>https://en.wikipedia.org/wiki/Cyber_City,_Gurgaon</p>
<p>Now one way would be to create as many cabs as there are people expecting to get out of DLF cybercity. 1000 people, try immediately creating/deploying 1000 cabs out of thin air. That has three challenges :</p>
<ul>
<li>
<blockquote>
<p>How to even achieve this immediately. There would be a demand surge everywhere , so you cannot deploy cabs from other places and if you just procure cabs, there are only so many available in all car showrooms of Gurgaon.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Even if you can theoretically produce 1000 cabs, what will they do after the demand surge is over. 1000 cabs is a lot of investment and one needs to be judged if its good enough for just one ride per new cab.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>If you have 1000 incomeing cabs at the same time, will DLF cybercity roads be able to handle a surge of 1000 new cabs all of a sudden.</p>
</blockquote>
</li>
</ul>
<p>So if India invests heavily to produce say 1 Billion vials of COVID vaccine per day, it would take Billions [maybe trillions of dollars] of investment, as stated above would take years to develop maybe and would be enough to vaccinate the whole world in 14 days. What would this investment do after the 14 days ? So only a production line that is economically fast and viable would be setup. No point waiting 2 years to build a pipeline of Billion vaccines per day, than waiting 2 months for a functional 100 Million/month pipeline.</p>
<p>But that doesn’t offset the fact there is a surge demand. I or any other person for that matter would prefer to get vaccinated immediately. What happens when you have surge demand for Uber ? <em>Dynamic pricing</em>. You cannot have that in a life saving thing like vaccine. So, the only other way is <em>rationing</em>.</p>
<p><em>Rationing</em></p>
<p>Rationing is what is going on right now. In Soviet Union’s later days, when bread was scarce, even that was rationed. Think of playing fastest finger first for even bread. Rationing means only a few people will get slots.</p>
<p>https://en.wikipedia.org/wiki/Rationing</p>
<ol>
<li>
<p>###</p>
<h3 id="my-answer-to-india-is-the-biggest-manufacturer-of-medicines-how-come-they-are-unable-to-manufacture-sufficient-covid-19-vaccines">My answer to “India is the biggest manufacturer of medicines, how come they are unable to manufacture sufficient Covid-19 vaccines?”</h3>
</li>
</ol>
<p>Originally answered here: https://qr.ae/pGp6ZP</p>
<p>[As of 17<sup>th</sup> April 2021] India has produced, administered and exported most amount of vaccines in the world. Much more than any other country [even the US]</p>
<p>https://timesofindia.indiatimes.com/india/india-fastest-in-world-to-administer-100-million-covid-vaccine-shots/articleshow/82007330.cms</p>
<p>###</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image3.png" alt="" /></p>
<p>https://www.businesstoday.in/current/economy-politics/india-exported-37-percent-of-covid-19-vaccines-as-gifts/story/431413.html</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image4.png" alt="" /></p>
<ol>
<li>
<p>##</p>
<p>##</p>
<p>##</p>
<p>##</p>
<p>##</p>
</li>
</ol>
<p>Safe to say India is producing more than any other country in the world.</p>
<p>We have India’s second COVID wave ongoing and that is why the demand for vaccine has shot up as people want to get vaccinated fast. To suddenly vaccinate over a billion people, you need over 2.5 Billion vials of vaccine. I guess that is much more than monthly production of all vaccines of the entire world combined !</p>
<p>I don’t think India had any plans to vaccinate everyone by April, so it had never invested into production as much.</p>
<p>If you can produce X vaccines / day, you need many factors to ramp up the production to say 10X/day {rate at which people expect vaccination to happen now} :</p>
<ul>
<li>
<blockquote>
<p>Demand [short term and long term]</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Investment</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Time</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Raw Material and Human Resources</p>
</blockquote>
</li>
</ul>
<p>Its not like tap , that you turn it on and water starts coming out. It takes a very long time to build a production pipeline.</p>
<p>“Sufficient” is an adjective. Adjectives are subjective, mean different to different people. When something is good for a person, they might never call it sufficient. There is no “sufficient salary” for example. Possibly you want everyone to get vaccinated in two days [That is 500 Million vaccinations/day] ? Do you think there is any infrastructure in the world that can handle such scale : production / supply chain wise ? Even if we have such a infrastructure theoretically in India, vaccines take weeks if not months to create immunity. There is no way a vaccination in middle of the pandemic wave would stop the wave, so even if we spend everything on vaccine production and administration [to say 10X/day], the current wave is not going away.</p>
<p>The right decision is first to provide care / oxygen / ventilators to serious patients and make sure we bend the curve. Some amount of money would go into boosting vaccine production, but that would not make the production/delivery 10x.</p>
<p>Even the world’s richest economies cannot solve scarcity produced due to black swan events like a sudden COVID wave. No one could have predicted that India’s almost non-existent COVID cases till January-February would go crazy in April. One slight mutation of virus in the UK and it brings a country almost out of the pandemic back in. We can only rationalize and intellectualize with advantage of hindsight.</p>
<p>I remember many “influencers” saying in January that vaccines are being rolled out too soon, they must be tested more and too much taxpayer money is being spent on “private” vaccine companies because there is no COVID urgency and today the same influences are asking why the vaccine production is slow. The definition of “sufficient” changes very fast !</p>
<h3 id="my-answer-to-why-does-india-face-oxygen-shortage-in-the-second-wave-of-the-covid-19-pandemic">My answer to “Why does India face oxygen shortage in the second wave of the COVID-19 pandemic?”</h3>
<p>Originally Answered here: <a href="">https://qr.ae/pGGtCT</a></p>
<p>Here is a follow up question to the original question. How much permanent Medical Oxygen capacity would you prepare in anticipation of a possible third wave of coronavirus pandemic given you have seen the first and second wave peaks {I hope that the peak is passing as on 25th April 2021} now ? Let’s say the first pandemic peaked at around 100k new cases a day and the ongoing [much worse] second wave has 250k new cases a day, how much oxygen would you produce/keep in stock always ? What’s the worst case scenario of a pandemic peak ?</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image5.jpeg" alt="" /></p>
<p>If Coronavirus pandemic [or any other pandemic for that matter] followed a normal distribution, you would know that it would peak somewhere around the percentage of population it had effected in the past. So in case a Normal distribution was being followed, India should have been ready in its second wave with 100k + 1 X standard deviation [to make sure that they would cover ~85% of scenario] of 100k + 2 X standard deviation to make sure they would cover ~98% of possible scenario. Everyone who knows Gaussian Bell curve can guess that , right ?</p>
<p>Keep in mind keeping high Oxygen in stock always requires :</p>
<p>1. <strong>Production Capacity:</strong> You definitely need more oxygen than is produced by sum total medical oxygen producers in India in response to common supply-demand equilibrium. Even in emergency mode, where most industrial units of India are producing as much oxygen as possible, we are barely reaching required capacity. So building permanent medical oxygen production for the “100 k + 2 X standard deviation new COVID patients / day” scenario is a LOT of investment. You should remember that pumping so much speculative money into permanent medical oxygen is only temporary as after the peak recedes, all this investment and oxygen plants will face a demand crunch [and I hope they do face low demand scenario, meaning the country is out the pandemic]. Even if we understand or not, the way to fight the pandemic once its spreads is tactical, converting ones existing resources [other industries] into weapons. But suppose that you still made the Oxygen supply capacity manyfold investing Billions of dollars. You now have permanent medical oxygen being produced for 100 K + 2 X standard deviation new COVID patients per day for the next wave.</p>
<p>2. <strong>Transportation Capacity:</strong> Transportation is the main bottleneck during Indian COVID second wave. You suddenly cannot build better roads or create 2X the amount of oxygen trucks which have been procured over years. It would take time. Let’s say that in the gaps between waves, you spend billions of dollars just produce tens of 1000s of oxygen trucks to make sure Oxygen can be supplied to address the 98% scenario above.</p>
<p>Let’s just say that India had Billions of Dollars and kept 100 K + 2 X standard deviation resources [98% of scenario] functional to beat the peak. Let’s say India was willing to write off all that money in case there was no peak as most of the medical oxygen / oxygen cylinder would have been un-needed in that scenario {that amount of money going waste would have been a great political gossip store in case no second wave would have happened}. We would all be set for the second wave if we addressed 98% of scenario [or looking at the first two waves, we would be all set for a third wave] right ?</p>
<p>Unfortunately, you cannot predict and cannot be prepared.</p>
<p>No government/ person can be sure of what the next pandemic peak size would be. If this would be the case, countries like EU or the US [with tonnes of cash] would have had much better responses to their second wave {they were struggling too}. The reason is the pandemic peaks [unlike many other phenomenon] do not follow a Normal Distribution. You just have no clue Mathematically what you have to prepare for. All human statistics [and Machine Learning] work around the feeling that similar things happen [or the Gaussian bell is true]. They fail to predict COVID waves or Earthquake Richter Scales or Size of a financial downturn because : 1. You have much less data as these are rare events [for example in above, what do you think the standard deviation in 100k + 2 X standard deviation patients/day is ?], 2. Even if you have data, these things don’t follow a Gaussian Bell. They follow other bells {or whatever you want to call the curve} like say Cauchy’s or Pareto’s.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image6.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image7.png" alt="" /></p>
<ol>
<li>When eccentricity parameters are out of control [when they are during cases like pandemics], such distributions will give infinite predictions to cover 98% scenario. Basically, whatever amount of money you invest, an even larger pandemic wave can come and your resources would be meager. You have no expected value even. You cannot ever be prepared for a pandemic wave.</li>
</ol>
<p>All a country can do is :</p>
<p>A. during the pandemic wave, be resourceful and adaptable. Convert existing resources into emergency pandemic resources [Like India has done converting large private firms like Tatas and Jindals into emergency Oxygen providers], ask people to social distance and hope for pandemic wave to go away. Trains and Airforce are carrying Oxygen to those who need.</p>
<p>B. Try to do things which keep virus spread to minimum. Social Distancing</p>
<ol>
<li>
<h2 id="2021-india-us-finance-dynamics">2021 India US Finance Dynamics</h2>
<ol>
<li>
<h3 id="my-answer-to-america-has-put-many-countries-including-india-in-the-list-of-currency-manipulators-what-are-currency-manipulators-and-what-action-will-be-taken-on-these-countries">My answer to “America has put many countries, including India, in the list of ‘currency manipulators’. What are ‘currency manipulators’, and what action will be taken on these countries?”</h3>
</li>
</ol>
</li>
</ol>
<p>Originally answered here : https://qr.ae/pGGvg0</p>
<p>“Currency Manipulators” are people who don’t play by America’s rules.</p>
<p>American currency (USD) is reserved currency of the world. As a result, America enjoys a special privilege. For example, US could print Trillions of dollars to distribute to its people and institutions during the pandemic to keep their economy working. Was that possible for any other country ? No. Inflation would have sunk the population if they print Trillions. OTOH, US can just go about having stock market boost and some visible retail inflation, but no serious consequence. Can China do this ? Can India do this ? Can EU do this ? No. They all had to manage by austerity and endure the economic collapse. The reason is that US is the economic engine of the world and a world power, others are not. American institutions have much more money now and well no one really seriously thinks that their currency’s power has gone down, others at best are where they were before the pandemic. Having much more money all of a sudden means US institutions getting asymmetrically strong.</p>
<p>Other countries on the other hand have had people becoming poorer. They cannot just print money to get out of the pandemic disruption as that would just cause hyperinflation and make them go bust. They also now have to encounter the asymmetric power of American investors and institutions who have gotten rich while these countries are doing worse. Because they cannot just drop out of the international commerce, they will try to use “tricks” to get around the sudden asymmetry that has been introduced. But “How dare you get away from ‘free and fair trade’, aye ? You manipulator.” Asymmetric differences between countries in terms of money or a disruptive technologies have created colonies/extinction of civilizations in the past, so its not totally stupid of countries to bypass such situations by using tricks. There are countries where the “elites” are happy playing the American game. India as of now, is not.</p>
<p>What’s the definition of currency manipulator you ask ?</p>
<p>https://www.msn.com/en-in/money/topstories/explained-us-adds-india-to-currency-manipulator-watchlist-what-does-it-mean/ar-BB1fQ6RV</p>
<ol>
<li>
<h2><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image8.png" alt="" /></h2>
<p>##</p>
<p>##</p>
<p>##</p>
<p>##</p>
<p>That basically means you cannot have an independent fiscal/monetary policy from US. Take decisions according to how US dollar behaves.</p>
</li>
</ol>
<p>US’s economic and financial future and clout depends upon how well their own people or people in other countries accept this sudden transfer of wealth to its power institutions. People like Ray Dalio think this might backfire too :</p>
<p>https://youtu.be/tw0wtyzW6nA</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image9.png" alt="" />Ray Dalio is one of the few persons in the world whose Economic views I feel actually represent reality.</p>
<h2 id="my-answer-to-what-are-the-lessons-for-india-in-joe-bidens-covid-rescue-plan-for-the-us-economy">My answer to “What are the lessons for India in Joe Biden’s Covid rescue plan for the US economy?”</h2>
<p>Originally answered here : https://qr.ae/pGvtV3</p>
<p>Subjective answer here.</p>
<p>You cannot copy Joe Biden’s plan in India due to 2 reasons :</p>
<ol>
<li>
<blockquote>
<p>You cannot print too much rupee like the US is printing dollars. US has almost doubled the Dollars in circulation in just one year. USD is the reserve currency of the world so people are taking some time to realize that things are suddenly much cheaper for people who have received these new printed US dollars. The entire foreign/economic policy of the US will be focused in next few years to justify that their dollars still hold the same value as pre 2019, while their institutions have many times more dollars. If the US can pull it off, it will retain the title of world power for sometime to come, if it fails, well they are going into a bad spiral. India neither has clout, nor its elite have spine to print and distribute money and force the world to accept that the value of its currency is unchanged. Unlike US MSM and elites, Indian MSM is more focused on showing our shortcomings, so we have to walk the tightrope of printing only enough to avoid a deflation spiral. Risk taking needs lot of support from all corners of society. An example is how US media covered the COVID surge and death in New York and how Indian media did it, showing pyres and creating an image of chaos. You can suddenly see the silence in US media about all the money printing after President Biden announced printing Trillions of it in his plans. That said, even US is taking a risk and it remains to be seen what happens.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>India is “Super Hyper sensitive” to inflation. You cannot risk inflation in some sectors to boost others here. Low per capita income has its disadvantages. The US is essentially trying out the next Marshall Plan which created wealth like crazy and gave rise to the baby boomer generation. But the circumstances are not same, let’s see !</p>
</blockquote>
</li>
</ol>
<p>https://www.bloomberg.com/opinion/articles/2021-04-15/big-banks-like-bofa-and-citigroup-can-t-keep-up-with-money-printing</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image10.png" alt="" /></p>
<ol>
<li>
<p>##</p>
<p>##</p>
<p>##</p>
<p>##</p>
<p>Just by December [before Biden’s spending plans], US had made 40% worth of new dollars.</p>
<p>https://gsiexchange.com/u-s-gov-has-printed-40-of-every-dollar-that-existed-in-march/</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image11.png" alt="" /></p>
</li>
</ol>
<p>##</p>
<ol>
<li>
<p>You can already see the case being built on India to accept the new change. “Currency Manipulator”, “Stopping vaccine raw material export” {now retracted} are steps which look like an attempt at that.</p>
<p>##</p>
<p>##</p>
<p>##</p>
<p>##</p>
<h2 id="2021-self-reliance-campaign">2021 Self Reliance Campaign:</h2>
<ol>
<li>
<h3 id="my-answer-to-how-far-can-india-go-to-keep-the-chinese-players-who-are-well-en-trenched-in-the-global-tech-supply-chain-off-the-indian-market-without-prejudicing-its-own-growth">My answer to “How far can India go to keep the Chinese players, who are well en-trenched in the global tech supply chain, off the Indian market without prejudicing its own growth?”</h3>
</li>
</ol>
</li>
</ol>
<p>Originally Answered Here: <a href="https://qr.ae/pNCyD5">https://qr.ae/pNCyD5</a></p>
<p>This is a very good question. Has an assumption which many people among us consider true or maybe God’s Word. I myself believe in Adam Smith’s concept of “the invisible hand” <a href="https://www.investopedia.com/terms/i/invisiblehand.asp">Dispelling Mysteries About the Invisible Hand</a></p>
<p>and that becoming a part of global trade system is very important to develop and make technological progress. I had to do some reading to convince myself why and how being self-sufficient and allowing the invisible hand to run are not opposing concepts but must co-exist.</p>
<blockquote>
<p>Let us talk about the basic assumption here : “Free Trade gets the best growth, the freer the better”. That is true to a very large extent. Inefficiencies start occurring if you interfere too much in free trade as competition doesn’t exist at all and this makes a stagnant, inefficient and bloated economy. Pre-1990 India’s socialist economy was like that and so we had to unwillingly accept free-trade in 1991, which was the economic fashion and trend back then. India tried to do everything by itself before 1991 and post 1991 we decided to stop trying to do most of the things and become the <a href="https://en.wikipedia.org/wiki/Sweatshop">Sweatshop - Wikipedia</a></p>
<p>of the world following the concept of specialization : <a href="https://en.wikipedia.org/wiki/Division_of_labour">Division of labour - Wikipedia</a></p>
</blockquote>
<p>. As you might see, we were at one extreme before 1991 and the other extreme after 1991. There was a time in 2000s that buying anything India-made was considered really bad and working at an Indian institution was considered backward and everyone wanted to work at a MNC. At the time of independence in 1947, the exact opposite was true.</p>
<blockquote>
<p>Its only after the <a href="https://en.wikipedia.org/wiki/Financial_crisis_of_2007–2008">Financial crisis of 2007–2008 - Wikipedia</a></p>
<p>2008 crisis that people started understanding that the old Indian proverb of “<strong>ना अति बरखा ना अति धूप</strong>” ( <a href="https://en.wikipedia.org/wiki/Moderation">Moderation - Wikipedia</a> ) is true in economics too. You need some redundancy, too much efficiency is like too much sugar in body. You need a lot of sugars to do your work, but a bit in excess, they start rotting the system. That appears to be true with most systems. In their paper here: <a href="https://www.swarthmore.edu/sites/default/files/assets/documents/user_profiles/bschwar1/GrantSchwartz_PPS2011.Too%20Much%20Good%20Thing.pdf">https://www.swarthmore.edu/sites/default/files/assets/documents/user_profiles/bschwar1/GrantSchwartz_PPS2011.Too%20Much%20Good%20Thing.pdf</a></p>
</blockquote>
<p>Adam Grant and Barry Schwartz told that there should be efficiency in any system, but to make it run at the maximum efficiency is generally harmful by giving concept of inverted U.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image12.png" alt="" /></p>
<blockquote>
<p>So while there is no doubt that you need to be efficient , but should not try to be the most efficient. That is in term of economics, you need to have as much free trade and as less control/centralization as possible, but that doesnt mean you give away the nation’s leverage altogether. The best example about how this works is China itself. China objects strongly when India applies any restrictions on trade, but does the same itself. Just yesterday : <a href="https://techcrunch.com/2020/09/07/scratch-ban-in-china/">China bans Scratch, MIT’s programming language for kids – TechCrunch</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image13.png" alt="" /></p>
<p>Not just that, Chinese market access is for sectors where it doesnt want to develop specialization in, otherwise the only access you get to is its cheap workforce. This enables development of economic sectors which it desires. No other country apart from China has been able to develop global internet companies like AliBaba, Baidu , TikTok and others after US. Same with electric cars, Solar, Consumer Electronics and many other technologies. No other country is in a race to become a superpower with US apart from China, understand the relationship.</p>
<p>The Chinese economic growth has been better than India, because unlike India, China took a bet on what segments it wants to specialize in rather than India which chose to specialize in industrial segments it was a more natural fit to.</p>
<blockquote>
<p>To defeat the general rate of progress of world’s economies, you will have to make several of such convex bets <a href="https://en.wikipedia.org/wiki/Convexity_\(finance\)">Convexity (finance) - Wikipedia</a></p>
<table>
<tbody>
<tr>
<td>and hope for some of them to succeed. Japan and the Asian tigers <a href="https://en.wikipedia.org/wiki/Four_Asian_Tigers">Four Asian Tigers - Wikipedia</a> did it in 1990s and China did it in 2000–2020. State forced industrialization is one such convex bet, all you need to make sure is that you dont get totally isolated from supply chain like North Korea and Soviet Union : [Industrialization in Japan: Origins, Characteristics & Impact - Video & Lesson Transcript</td>
<td>Study.com](https://study.com/academy/lesson/industrialization-in-japan-origins-characteristics-impact.html?wvideo=up3rn5t1r0)</td>
</tr>
</tbody>
</table>
</blockquote>
<p>India has till now resorted to the risk free option of free trade, which has given it a decent economic push, but we need to take bets too. China took a bet to become the hub of global supply-chain when it was clearly not going to be able to and succeeded by giving clever access to its market. India on the other hand let inefficiency creep in until things broke and it had to surrender its market with very few restrictions. We need to understand our populace and need to build both a consumer base and a supply-chain focused both inward and outward.</p>
<p>My opinion is that we should try to have as much free trade but not run blindly behind it . Some points I would like to say about why in practical world, the overplaying “invisible hand” fails (this is opinionated and not based on any research) are as follows:</p>
<p><strong>No inter-country free trade is actually free :</strong> A very good documentary about that here :</p>
<p><a href="https://youtu.be/DnW9ZQtI1_E"><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image14.png" alt="" />https://youtu.be/DnW9ZQtI1_E</a></p>
<p>Global free trade is well packaged politics. Global Trade is only as beneficial as the person negotiating it on your behalf has leverage and good intentions. We have been lucky to have not negotiated things too badly, but not everything is perfect. As said earlier, free trade is good, but no point going banana over it.</p>
<blockquote>
<p><strong>Some specializations are less “replaceable” than the others and hence carry more risk :</strong> Adam Smith’s invisible hand is very true for a short-term static universe, but it doesn’t take creative disruption into account. Some specializations achieved by free trade, like India becoming an IT sweatshop are more at risk of becoming redundant than say Computer Science research. China recognizes it and has launched <a href="https://en.wikipedia.org/wiki/Made_in_China_2025">Made in China 2025 - Wikipedia</a></p>
</blockquote>
<p>program which targets industry 4.0, things that are not going to go through commoditization soon. Replaceable specializations lead to instabilities.</p>
<h3 id="my-answer-to-as-an-indian-if-i-am-buying-a-xiaomi-phone-do-i-indirectly-contribute-to-chinese-economy-which-is-not-good-for-indian-economy">My answer to “As an Indian If I am buying a Xiaomi phone do I indirectly Contribute to Chinese Economy which is not good for Indian Economy?”</h3>
<blockquote>
<p>Originally answered here : <a href="https://qr.ae/pNbKBk">https://qr.ae/pNbKBk</a></p>
<p>{You will need context of India-China tensions in 2020 to get the background of this question : <a href="https://en.wikipedia.org/wiki/2020_China–India_skirmishes">https://en.wikipedia.org/wiki/2020_China%E2%80%93India_skirmishes</a> }</p>
<p>Yes. Buying a Chinese phone contributes to economy of China. Money does go to China and it can invest that money into military build up on our border and kill our people just like it did earlier.</p>
<p><a href="https://www.hindustantimes.com/india-news/20-indian-soldiers-killed-in-lacstand-off-with-chinese-troops/story-1qTQWKJjba6xXAKwyMh2aM.html">20 Indian soldiers killed in LAC stand-off with Chinese troops</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image15.png" alt="" /></p>
<p>Its not just simple ‘Chinese firms paying taxes in China’ issue, China’s state has deep connections with its companies.:</p>
<blockquote>
<p><a href="https://www.cfr.org/backgrounder/huawei-chinas-controversial-tech-giant">Huawei: China’s Controversial Tech Giant</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image16.png" alt="" /></p>
<p>Chinese companies are also notorious for potential data transfer to China. Apparently they are bound by a Chinese law to transfer data of anyone on their platforms to Chinese government anytime it demands.</p>
<p>These are the two things why sudden anti-china sentiment is being seen in Indian market. When our data, our land and our people can get in danger by us spending money on something, why do it ? Its true that China is the factory of the world and many components for almost everything you buy come from China, a share of profit going to Chinese firms is vastly different than all of it. Most countries have realized this supply chain bottleneck and are trying to fix it.</p>
<p>That said, buying Chinese products doesn’t harm our economy directly. It might not be the best way we should run our economy (otherwise China would be allowing products of other countries to dominate in its local markets, which it doesn’t and I guess no one really considers Chinese economic policy bad), but its still better than how our country had a socialist economy pre-1990s gatekeeping for our elite.</p>
<p>I think we can learn from China how to use our markets to not just grow economy but also make it more sturdy. Post independence, our markets have had strange emotions, either not opening up at all or becoming totally xenophilic .</p>
<p>The answer is always in the middle, what probably we are trying now, no mandatory import substitution but a preference to Indian goods and services.</p>
<h3 id="my-answer-to-how-can-we-say-that-india-can-affect-the-chinese-economy-while-on-the-other-hand-all-indian-startups-such-as-paytm-ola-oyo-swiggy-etc-are-funded-by-china-only">My answer to “How can we say that India can affect the Chinese economy while on the other hand all Indian startups such as Paytm, Ola, Oyo, Swiggy, etc. are funded by China only?”</h3>
<blockquote>
<p>Originally answered here: <a href="https://qr.ae/pNCZMX">https://qr.ae/pNCZMX</a></p>
<p>{You will need context of India-China tensions in 2020 to get the background of this question : <a href="https://en.wikipedia.org/wiki/2020_China–India_skirmishes">https://en.wikipedia.org/wiki/2020_China%E2%80%93India_skirmishes</a> }</p>
<p>I have written in detail about this in my answer here: <a href="https://qr.ae/pN2Ivf">Muktabh Mayank’s answer to What are your views on Chinese investment in Indian unicorn startups?</a></p>
</blockquote>
<ol>
<li>
<blockquote>
<p>Why do we need to effect China’s economy ? All we need to make sure is we aren’t too dependent on their supply chain which they might use as a leverage against us. The aim should be to develop our nation’s economy while having reasonable control and competition. We need to work for benefit our our people, ways-of-living and community, not for harm of someone else. Don’t fall for the emotional shorttermism of harming/effecting someone else’s economy. It’s not a <a href="https://en.wikipedia.org/wiki/Zero-sum_game">Zero-sum game - Wikipedia</a>. A civilization built on malefic intentions will not last, India has never done this in past, is not doing anything like this today, and will not do it in future.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>You need external money to grow with less amount of risk. Equity Investments are almost never bad if handled carefully. As long as startups are serving India and have effective management in India, there is no problem in reducing risk right now when we are relatively weak by giving away some share of our future riches. Marginal Utility of money is much high now than it will be when our country is rich and developed. Emotions and business dont mix well together, dont confuse them.</p>
</blockquote>
<ol>
<li>
<h3 id="my-answer-to-should-indias-self-reliance-be-taken-as-isolation">My answer to “Should India’s self-reliance be taken as isolation?”</h3>
</li>
</ol>
</li>
</ol>
<p>Originally answered here : https://qr.ae/pNzSYF</p>
<p>No. Making internal products competitive is different from banning foreign competitors. The former is called what “Atma Nirbhar” [Self Reliance] means and the latter is what isolation was pre-1990. One needs to realize difference between “homophilly” and “xenophobia”. Unfortunately, extreme ideologies like “total free trade” or “boycott all foreign goods” make better sales politically and emotionally than common sense. Common Sense is to force competition between foreign and Indian products using policy to keep local companies on edge and innovative and having check on foreign companies to keep local companies competitive. We Indians were “only local” pre 1990 and “yo! foreign” post 1990, both wrong in today’s perspective {maybe correct decisions then}.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image17.png" alt="" /></p>
<blockquote>
<p>There is no way an indigenous product would ever be competitive to a foreign product given the amount of head start and preferential attachments international companies have as compared to an India only firm. Delivering same quality at the same price requires the same scale of production. <a href="https://en.wikipedia.org/wiki/Economies_of_scale">https://en.wikipedia.org/wiki/Economies_of_scale</a></p>
</blockquote>
<p>, someone will have to help the weaker guy out if we want weaker guy to become competitive in the long run. We do so in education, jobs and society, why cant we help our weaker companies become competitive to multinational behemoths ?</p>
<p>You need to understand that anyone with more resources will want open competition [free market, no reservations] as they have resources to beat the weak opponent by quality alone. The decision is with us if we want the weaker opponent to stay competitive in the long run or no.</p>
<h3 id="my-answer-to-since-india-has-banned-several-chinese-apps-can-china-retaliate-by-refusing-to-supply-so-many-products-which-we-are-forced-to-import-from-china">My answer to “Since India has banned several Chinese apps, can China retaliate by refusing to supply so many products which we are forced to import from China?”</h3>
<p>Originally answered here : https://qr.ae/pN9Ab4</p>
<p>That would be slightly bad for India and very bad for China.</p>
<p>India is a HUGE and irreplaceable market and losing access to a part of it is certainly better than losing access to all of it. To do the latter as a retaliation of the former by China would be considered a bad economic step, something that only former Argentina governments would have done. (Argentina government once used to heavily tax exports, so well why not just ban it).</p>
<blockquote>
<p>India on the other hand will face some supply crisis, but due to the huge demand, would end up building a indigenous supply chain or an alternative supply chain. India’s only aim should be continuing to grow people’s wealth while pushing towards a hybrid manufacturing-knowledge economy. The only time supply side crisis is a problem when it is about essentials about food and medicine. India has learnt a lesson from 1950–60 food crisis ( <a href="https://www.economicsdiscussion.net/india/food-problem/food-problem-in-india-with-measures/21604">Food Problem in India (With Measures)</a></p>
</blockquote>
<p>) and guards its internal players against such risks thenceforth. The one essential India imports is oil and that is not from China (and will slowly get redundant as we move to solar).</p>
<blockquote>
<p>The symmetrical response to India’s app ban by China would be to ban Indian apps (which I doubt are used in China) or other exports (mainly raw materials). That btw does not look like a problem yet : <a href="https://www.hellenicshippingnews.com/india-iron-ore-exports-scale-new-heights-on-strong-china-demand/">India: Iron ore exports scale new heights on strong China demand</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image18.png" alt="" /></p>
<ol>
<li>
<h2 id="2020-coronavirus-crisis">2020 Coronavirus Crisis:</h2>
<ol>
<li>
<h3 id="my-answer-to-has-india-officially-gone-into-recession-as-of-2020-if-so-how-much-time-would-it-take-for-us-to-recover-from-it">My answer to “Has India officially gone into recession as of 2020? If so, how much time would it take for us to recover from it?”</h3>
</li>
</ol>
</li>
</ol>
<p>Originally answered here : <a href="https://qr.ae/pNiVKk">https://qr.ae/pNiVKk</a></p>
<p>Every country in the world (I don’t know about China and North Korea) has gone into economic despair. Recession is a technical term for two quarters of negative growth (that is basically economy becomes smaller than the last quarter and then again the same thing happened in the next quarter). For most countries, first quarter of lockdowns was worse than the second one, so they avoided “recession” technically. That doesn’t mean the second quarter was good, just that it was less bad.</p>
<p>India measures its growth rate with respect to the same quarter of last year (YoY instead of QoQ)). So all this says is, we had a worse Mar-May economically in 2020 than 2019 and worse Jun-Sept economically in 2020 than 2019. If other countries calculated recession this way, they would have all been in the same boat (Few countries had a better economy in 2020 than 2019). There cannot be economic growth during a pandemic anywhere !</p>
<blockquote>
<p><a href="https://www.thenationalnews.com/business/economy/india-enters-recession-as-covid-19-pandemic-hits-its-economy-1.1118917">India enters recession as Covid-19 pandemic hits its economy</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image19.png" alt="" /></p>
<p>Political Press, however, will use this type of technicality to drive their political views. All you need to understand is, this recession really has no extra negative effect apart from well of course the economic losses in pandemic times. Its like a economic trauma, one can recover from the damage and be back, not like a chronic economic problem as many people would want you to believe.</p>
<h3 id="my-answer-to-how-come-the-worlds-biggest-economy-usa-and-the-worlds-most-populous-nations-china-economies-havent-shrunk-as-much-as-indias-have-they-managed-their-economy-better-or-covid-19-than-us-or-both-both-covid-19-and-economy">My answer to “How come the world’s biggest economy (USA), and the world’s most populous nation’s (China) economies haven’t shrunk as much as India’s? Have they managed their economy better or Covid-19 than us, or both both Covid-19, and economy?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNcqj0">https://qr.ae/pNcqj0</a></p>
<p>Good Question, but I am not sure that is true.</p>
<p>The reason why people feel India did much worse is because India reports YoY [That is a quarter is compared to same quarter of a previous year] numbers and US reports QoQ [Quarter of economy is compared to just the previous quarter]. When you look at these numbers, India’s case looks worse. That however is like comparing celsius temperature to fahrenheit. Let’s see apples to apples :</p>
<blockquote>
<p><a href="https://tradingeconomics.com/india/gdp-growth-annual">India GDP Annual Growth Rate</a></p>
<p>vs <a href="https://tradingeconomics.com/united-states/gdp-growth">United States GDP Growth Rate</a></p>
</blockquote>
<p>India lost over 23% of its economy in Q2 :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image20.png" alt="" /></p>
<p>US did not do better :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image21.png" alt="" /></p>
<p>If anywhere India was doing worse than expected, it was in 2019. Look at the drop between 2018 and 2019.</p>
<p>China on the other hand, nowhere close, look at the numbers.</p>
<blockquote>
<p><a href="https://tradingeconomics.com/china/gdp-growth">China GDP Growth Rate</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image22.png" alt="" /></p>
<p>China did better because {and I don’t believe I am saying this and I still doubt I believe all the data they sent in} they are an authoritarian government. They could ensure <em>strictest possible lockdowns</em> and contain the CoronaVirus spread very quickly. Once COVID was gone and the rest of world struggling, all China needed to do was start producing things they would consume during the pandemic {and they would have passed some stimulus too}. Zero COVID strategy may require reduction of some human rights [look at the negative opinions on lockdown imposition in India and the US], but once you reach zero COVID infections after a harsh lockdown, you could just reopen. In India, we did wait and give way for the poorest of poor during lockdowns.</p>
<blockquote>
<p><a href="https://e2ce7631-765d-43bc-802c-4092e3250e22.filesusr.com/ugd/e42b58_106bab46da0b412c9b116e81cc65d1ea.pdf">https://e2ce7631-765d-43bc-802c-4092e3250e22.filesusr.com/ugd/e42b58_106bab46da0b412c9b116e81cc65d1ea.pdf</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image23.png" alt="" /></p>
<p>Democracies like India and US are very sensitive to human rights and believe in “No one left behind”. You can find many reports of state and center governments “overreaching” during lockdown, while they were trying to contain spread. China focused on cold Maths and Statistics.</p>
<p>I am still of the opinion that India could impose a much better lockdown than I was expecting it to do and the economic effects of pandemic are lesser than what they were expected to be. Reuters also says so :</p>
<blockquote>
<p><a href="https://www.reuters.com/article/india-economy-gdp-idUSP8N2GY00P">India’s economy shrinks 7.5% y/y in July-Sept quarter - govt</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image24.png" alt="" /></p>
<h3 id="my-answer-to-can-india-beat-covid-without-raising-budget-spending-dramatically">My answer to “Can India beat Covid without raising budget spending dramatically?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pND8kP">https://qr.ae/pND8kP</a></p>
<p>Have you heard the phrase “Penny wise, Pound foolish !”. Being fiscally conservative at the time of an emergency like pandemic is exactly that.</p>
<p>The state doing nothing might be a good solution when the times are normal {that is at least what conservatives and some schools of economists believe} and you can possibly allow people to take charge and drive growth. Calvin Coolidge, the US President during the 1920s, was exactly an example of this. He let citizens drive economy and enjoyed a growth rate of 4% by basically doing “nothing”.</p>
<blockquote>
<p><a href="https://www.marioncountygop.org/coolidge_economy">Calvin Coolidge and the Moral Case for Economy</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image25.png" alt="" /></p>
<blockquote>
<p>US saw an economic boom in 1920s : <a href="https://en.wikipedia.org/wiki/Roaring_Twenties">Roaring Twenties - Wikipedia</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image26.png" alt="" /></p>
<p>Coolidge entered office in an economic boom and did nothing, basically what a libertarian President should do and the economy grew like there was no tomorrow.</p>
<p>Governments during good times make investments in bad projects like Greece hosting Olympics in 2000. They are loss making and don’t build enough infrastructure for future growth, so some fear by conservatives is justified. However, there are places like EV subsidies where governments might actually introduce a great new engine into economy. You can see that spending during good times is discretionary, can be good or bad.</p>
<blockquote>
<p><a href="https://finance.yahoo.com/news/nio-motors-nyse-nio-chinese-164539129.html">Nio Motors (NYSE: NIO) Has Chinese Government Support: But Do The Risks Outweigh The Benefits?</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image27.png" alt="" /></p>
<blockquote>
<p>However, in case of Coolidge, just like any other boom, there came a correction in 1929, a shocker which just reduced spending {and borrowing}. This is a nominal process in finance, a crash comes once every few years. The question is never “if” but “when”, and more importantly, “how is it handled ?”. <a href="https://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929">Wall Street Crash of 1929 - Wikipedia</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image28.jpeg" alt="" /></p>
<p>Just like spending creates positive multiplier effect in boom, risk aversion after a economic shock creates a deeply negative one. People who have lost money {from say stock markets in 1929/2008 or due to pandemic disruption in 2020}, will not want to spend and hence the economy will keep getting smaller and smaller , reducing the RoI and confidence in spending even more. Without people spending, there is no economy.</p>
<p>People losing money due to economy shrinkage is actually money that evaporates away and cannot be brought back immediately. “Basically your next month salary is money that your employer’s clients make this month. If they dont make money this month, your next month salary is gone and so is the salary of a local barista where you drink coffee, assuming that you will cut discretionary expenses like cafe house visits if you lose a month of salary”. All this money just evaporates if your company’s client doesn’t make money one month. Think of this as a whole, the economy just becomes a fraction of cost if people lose money in a shock event !</p>
<p>Do you just wait for the crash to grow incrementally and see what is the lowest it reaches, be totally laissez faire , or avoid the downturn ? Economy lost money as a shock, but does the sudden shock need to reverberate in future months ? That is the problem government spending solves. Pushes some extra money by spending to partially cover for the shock so that the shock is temporary or at least is not lethal. Think of the amount of money governments are pushing into economy right now being done in normal times, inflation would have skyrocketed. But just spending is not what works too. Beyond a certain level, too much cash becomes a bigger problem. Central banks need to avoid both deflation and high inflation. This is solved by spending in “useful” stuff which creates a multiplier effect in productivity just like spending creates a multiplier effect in demand.</p>
<p>What happened in 1929–30 is that the US government did some spending to get the economy going and when they saw that things are improving a bit, they went back to gold standard and strict fiscal discipline [Government should not spend more than it makes]. This created a depression so huge it lasted almost a decade. The consumer never had enough money to spend !</p>
<blockquote>
<p><a href="https://en.wikipedia.org/wiki/Great_Depression">Great Depression - Wikipedia</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image29.png" alt="" /></p>
<p>Now a pandemic is a shock event {called black swan by N N Taleb} just like a stock crash, but it has an added component. You do not generally know its long term effect of pandemic on population. So unlike a stock crash where one has to save just the economy, in a pandemic one has to save both citizens’ lives and economy. Government’s work is to do the tightroping between avoiding a negative loop to setup and making currency useless due to lack of productivity.</p>
<p>Clever spending is the answer, no spending is not, neither is over spending !</p>
<h3 id="my-answer-to-is-building-another-parliament-house-costing-hundreds-of-crores-amidst-the-economic-crisis-by-the-government-in-india-justified">My answer to “Is building another parliament house costing hundreds of crores amidst the economic crisis by the government in India justified?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNZrAO">https://qr.ae/pNZrAO</a></p>
<p>If you believe Keynes <a href="https://en.wikipedia.org/wiki/John_Maynard_Keynes">John Maynard Keynes - Wikipedia</a></p>
<p>, that is exactly the type of project a government needs to do when they want to push money into the economy.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image30.jpeg" alt="" /></p>
<p>Even hard critics of Keynes, like Hayek, who are against interference of government in economics, agree that in extreme circumstances like a pandemic, the government needs to inject money into the economy to keep it running. (Albeit he advocates much less long term government involvement).</p>
<blockquote>
<p><a href="https://en.wikipedia.org/wiki/Friedrich_Hayek">Friedrich Hayek - Wikipedia</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image31.jpeg" alt="" /></p>
<p>Please remember that its not just the parliament that the government is building, its rebuilding the whole capital area around Parliament. This structure would be used to administer the country for another 100–200 years. The construction has been planned and delayed since 2010, but now is the right time to get it done.</p>
<p>Construction is the type of place where you want to put money to reboot the economy after a bad shock like a war or pandemic. It starts putting money almost immediately, requires lots of workers, doesn’t require a lot of expertise (constructing buildings is somewhat of a commodity skill) and the buildings and public utilities would be used for a lot of time.</p>
<h3 id="my-answer-to-how-could-indian-billionaires-increase-their-wealth-during-the-pandemic">My answer to “How could Indian billionaires increase their wealth during the pandemic?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNzysm">https://qr.ae/pNzysm</a></p>
<p>In event of a shock event, like a pandemic, everyone suffers. However, in recovery, some qualities make one recover much faster than others. People who are more self-sufficient, have ability/prestige to get things done and most importantly have wealth/influence emerge much stronger. The reason is world depends upon them and looks upto them to show the way out of the shock. There would be a few people with these qualities who would still blow it, but, they will need to try really hard.</p>
<p>So, what is the reason of Indian billionaires getting richer ? Every shock effect {pandemic/wars} have their losers and the winners. The ones who are getting rich are the winners of pandemic disruption lottery. There can be two possible ways :</p>
<blockquote>
<p><strong>Increase in value of pre-existing wealth :</strong> This is something we can understand by the Starbucks effect in real estate. <a href="https://aipcommercialrealestate.com/the-starbucks-effect/">The Starbucks Effect - How It Affects Nearby Properties</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image32.png" alt="" /></p>
<p>Sometimes, some areas in city suddenly become relevant and costlier real estate when they get lucky (in this case they are chosen as a location for a hip upmarket coffee shop). These areas would have had potential, but Starbucks announcing their intent to setup a coffee shop there suddenly makes a house worth say 20,000 $ become 40,000 $. Remember no money is really transferred yet, just coffee shop being announced makes one’s real estate values on books go double. Then they can choose to put their house on a relatively high rent and even make some cash from there good fortune.</p>
<blockquote>
<p>Similarly, some billionaires happened to have their stakes in businesses which suddenly became much more conspicuous during pandemic times. As people were working from home and staying at home, Jio’s utility was suddenly proven much more than ever. {It was a good product already, but its usage shot during the pandemic times}. As a result large players decided to invest some money into it at high valuations. That made the value of rest of the shares of company shoot through the roof. <a href="https://worknomadandtravel.com/how-mukesh-ambani-became-us22-billion-richer-in-2020/">How Mukesh Ambani became US$22 billion richer in 2020</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image33.png" alt="" /></p>
<p>Remember Mr. Ambani did not get 22 Billion transferred to his account, it was just that the world believes his property [company stocks] is worth much more than what it was earlier. I describe Elon Musk’s sudden rise to become the richest person here : <a href="https://www.quora.com/How-did-Elon-Musk-manage-to-become-the-richest-person-in-the-world-with-companies-that-arent-even-profitable-yet/answer/Muktabh-Mayank">Muktabh Mayank’s answer to How did Elon Musk manage to become the richest person in the world with companies that aren’t even profitable yet?</a></p>
<p><strong>Liquidity Storm :</strong> Another reason is the crazy macroeconomics that plays out during shock events like pandemic. People suddenly stop spending and want to save their money into things that would keep their money safe. They could keep it safely in banks’ savings/fixed deposit, but that is a bad option as interest rates are low during an economic shock. Also the government pumps money into the economy to make sure people who live check to check survive and economy is not tanked and increased supply of money means the currency might lose value. So they need to put money in places which will yield them high returns. Where are they ? stocks of large companies that are gaining due to pandemic.</p>
<p><a href="https://www.quora.com/Why-do-global-stock-markets-rise-even-during-an-economic-collapse/answer/Muktabh-Mayank">Muktabh Mayank’s answer to Why do global stock markets rise even during an economic collapse?</a></p>
<p>Remember not all billionaires gain crazy amount of wealth during a disruption, some of them gain, others lose money as well. Just like amongst common people, there are lottery winners among billionaires too media chooses to focus on the ones who make wealth more than who lose wealth to show wealth creation to be a zero sum game [poor getting poor, rich getting rich].</p>
<p>Another thing is billionaire’s investments are generally well hedged against shock events. There are investment funds and dedicated family offices. So well hedged investments avoid them from absolute ruin. Thus you have few such stories of billionaires getting poor after a shock event, which projects an impression that all billionaires made profits. हाथी मरा तो भी नौ लाख का</p>
<h3 id="my-answer-to-do-indians-now-feel-the-absence-of-an-eminent-economist-in-the-decision-making-process-to-lift-the-economy-as-repeated-measures-of-goi-are-not-giving-desired-results">My answer to “Do Indians now feel the absence of an eminent economist in the decision making process to lift the economy as repeated measures of GOI are not giving desired results?”</h3>
<blockquote>
<p>Originally Answered Here: <a href="https://qr.ae/pNMQbi">https://qr.ae/pNMQbi</a></p>
<p>{This question was asked in September 2020, during COVID19 disruption when economies of most countries had tanked}</p>
<p>India has an economist in the decision making loop always to advice government : <a href="https://en.wikipedia.org/wiki/Chief_Economic_Advisor_to_the_Government_of_India">Chief Economic Advisor to the Government of India - Wikipedia</a></p>
<p>The post is right now being held by <a href="https://en.wikipedia.org/wiki/Krishnamurthy_Subramanian">Krishnamurthy Subramanian - Wikipedia</a>.</p>
</blockquote>
<p>Are you suggesting that all the decisions should be made just economists as in a technocracy ? That is not really the best approach according to me as I explain here : <a href="https://qr.ae/pNF9wX">Muktabh Mayank’s answer to Should Indian netizens come together to create a decentralised, democratic, and technocratic political party?</a></p>
<p>Reasons according to me are :</p>
<ol>
<li>
<blockquote>
<p>Economics is not a science like say Maths/Physics is. Answer to a question is not fixed. Its study of cause and effect. You will have economic theories and schools and different solutions to the same problem. Each of this . When you choose an economist to take all decisions, you are essentially choosing one school of economics over other. Its more like making a religious/philosophical/political choice than say vouching for evidence based science. The best approach is to have representatives from different schools advice to leader (who is good at decision making) who then takes the right step.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>A technocrat on top who is there because (s)he as an expert has tonne of optionality to try out untested theories and not be responsible to people for their failure in anyway unlike an elected politician who needs to go back to people for validation. Every Economic Policy Decision tries to optimize some number, which it always will very well or average, but whether improving that number helps common people can be judged by people’s validation. A bureaucrat on top OTOH has the problem of not being qualified enough and need to rely on experts’ validation. That is the reason we choose leaders, people solely responsible for decision making, they have no excuses and have to perform what people expect them too.TL,DR : Democracy is better than technocracy/bureaucracy !</p>
</blockquote>
</li>
</ol>
<p>You can have opinions about whether the Economic decisions are optimizing the metrics that you consider important and disagree with them (that is democracy), but to say that no economic policy exists and no economic policy is involved in taking the decision is not correct. India’s government has a process, flawed or good.</p>
<p>Another thing that all of us need to understand that India and most countries of the world (except China who is not doing as bad) are going through a bad phase due to the pandemic. Economy is us people going out and spending money. Most people are afraid and some have lost their job and hence people are spending less making economy shrink for most places where pandemic has spread. We don’t really know how the economic recovery will look like for any country and only time will tell.</p>
<p>India was locked down for very long to develop an infrastructure against the pandemic. This is very different from other cold countries who had to reopen during their summers to avoid letting people die and are facing second wave of the pandemic now.</p>
<p>Is this recent case guiding your perception ? Lot has been written comparing India’s Jun-Aug 2020 quarter performance under a partial lockdown with countries that had already opened up (without this disclaimer) :</p>
<blockquote>
<p><a href="https://www.firstpost.com/india/indias-gdp-contraction-worse-than-any-other-g20-nations-says-imf-gita-gopinath-congress-links-slump-to-demonetisation-8781431.html">India’s GDP contraction worse than any other G20 nations, says Gita Gopinath; Congress links slump to demonetisation - India News , Firstpost</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image34.png" alt="" /></p>
<p>In June :</p>
<blockquote>
<p><a href="https://health.economictimes.indiatimes.com/news/industry/france-reopens-economy-to-quicken-virus-recovery/76377706">France reopens economy to quicken virus recovery - ET HealthWorld</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image35.png" alt="" /></p>
<p>Now :</p>
<blockquote>
<p><a href="https://www.bbc.co.uk/news/world-europe-54535358">Coronavirus: France to impose night-time curfew to battle second wave</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image36.png" alt="" /></p>
<p>I have pasted links about France here, but a similar situation is ongoing in other countries you would typically think of having an economically better quarter in Jun-Aug 2020.</p>
<p>India chose a longer lockdown to get rid of the first COVID wave and is reopening now during its festival season. You can expect people going out and spending more and economy bouncing back a bit.</p>
<p><a href="https://qr.ae/pNMilQ">Muktabh Mayank’s answer to Amongst this exponentially increasing COVID-19 cases, is unlock V a good move? Why?</a></p>
<p>Industry is already anticipating this and hence you see +ve news like this :</p>
<blockquote>
<p><a href="https://www.financialexpress.com/economy/manufacturing-pmi-at-over-8-year-high-in-september-industry-raises-output-at-full-throttle/2095661/">Manufacturing PMI at over 8-year high in September; industry raises output at full throttle</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image37.png" alt="" /></p>
<p>The best we can hope is now that we are reopening, people go out and spend giving our economy some much needed recovery while following social distancing and wearing masks during upcoming festival/marriage season.</p>
<p>Ok , so now summarizing (and adding some more points just in case) :</p>
<ol>
<li>
<blockquote>
<p>Economy is us people going out and spending. Despite most Indians still having the traditional economy when they think of GDP, India is now a <a href="https://en.wikipedia.org/wiki/Consumer_economy">Consumer economy - Wikipedia</a>. We were afraid and locked in our houses and afraid of spending till sometime back and it was bound to fall. To reopen, government needed to win our confidence so that we go out and spend on reopening. That is what has happened with first wave of pandemic peak getting over. People will now be willing to go out and spend making the wheel if economy turn.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>So now we are reopening just like other countries did. We did not have to hurry unlike Europe to reopen in summers as we have pleasant winters. We could get past the first peak and develop some infrastructure. Some of our experts take things half cooked. We take reopen-shut formula of pandemic economy from other countries doesn’t mean we take the exact timings of reopen-close. (And then there is so much noise!). Europe, US and India have different business seasons. Let’s learn to learn and think beyond the west BTW and copy tricks how China, Korea and Vietnam contained the pandemic, high mask compliance.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>If you think all this co-ordination is being managed without technical people advising government, I think you need to reconsider your opinions. While not all technologists are good at decision making and even their jobs, some are really really good.</p>
</blockquote>
<ol>
<li>
<h2 id="2019-economic-stagnation-">2019 Economic Stagnation :</h2>
</li>
</ol>
</li>
</ol>
<p>Some thoughts on 2019 Indian Economic Slowdown</p>
<h3 id="my-answer-to-why-is-the-indian-economy-not-growing-">My Answer to “Why is the Indian Economy not growing ?”</h3>
<p>Originally Answered Here: <a href="https://qr.ae/pNnZk7">https://qr.ae/pNnZk7</a></p>
<p>Indian economy is not “not growing”.</p>
<p>The rate of growth has gone down though. That’s like when your car’s speed goes down, it still moves forward, though slowly. The typical rate of growth of Indian GDP in last few years has been around 6%. It has however gone down to 4.5% this quarter.</p>
<p>There are multiple analysis of what is responsible for this, I think its a combination of factors. Few things I would like to say before I answer:</p>
<ol>
<li>
<blockquote>
<p>I am not an economist.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>This is what I have guessed from my readings on the internet and elsewhere and can have my biases ingrained into it.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>You can think of it as a subjective answer and may not want to agree.</p>
</blockquote>
</li>
</ol>
<p>So here we go, the reasons for why the economy is “growing slower”</p>
<p><strong><em>1. A bubble killed Adam Smith:</em></strong></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image38.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image39.jpeg" alt="" /></p>
<p>I think we all know what is the best policy to make your economic numbers (any numbers: GDP / GNP / controlling inflation) get better: “ <strong>Laissez Faire</strong> “. Simple supply/demand should be able to make economy efficient and ever growing. Just don’t come in the way. All Adam Smith assumes is two things : 1. Humans are greedy 2. Humans have information at hand and will make rational decisions. That’s it. You let business happen without any interruption based on people buying what they need at the cheapest cost and the economy will keep on growing perpetually.</p>
<p>The living proof of this was almost a super rapid advancement of the world economy with Globalization for decades after World War <a href="https://en.wikipedia.org/wiki/World_War_II">World War II - Wikipedia</a></p>
<p>and even faster after Cold war <a href="https://en.wikipedia.org/wiki/Cold_War">Cold War - Wikipedia</a>. Pax-Americana <a href="https://en.wikipedia.org/wiki/Pax_Americana">Pax Americana - Wikipedia</a></p>
<p>for all practical purpose is the most Laissez Faire system we have ever seen in the world.</p>
<p><a href="https://www.imf.org/external/pubs/ft/weo/2009/update/01/">Global Economic Slump Challenges Policies</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image40.jpeg" alt="" /></p>
<p>You can see that the World economy was always growing post 1970 (always higher that 0% until 2010)</p>
<p>Look at how Per Capita Income looked before/during Pax Americana:</p>
<p><a href="https://ourworldindata.org/economic-growth">Economic Growth</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image41.png" alt="" /></p>
<p>So why did the system of Adam Smith fail despite of being so basic ?</p>
<p>Now there is no error in the assumption that “Humans are greedy”, but the other basic assumption “Humans have information at hand and will make rational decisions.” has some flaw. Humans often don’t collect enough information and they can take irrational decisions. When greed and rationality are misaligned, humans go with greed. That’s what happened with many bubbles of late 20th and early 21st century. Humans knew that there is a limit on betting on something, but they kept doing it until the risk became too high. The Dot Com bubble was small, the <a href="https://en.wikipedia.org/wiki/Subprime_mortgage_crisis">Subprime mortgage crisis - Wikipedia</a></p>
<p>blew the world over. The world’s economy became smaller and almost came to a stop.</p>
<p>Why is this relevant here ?</p>
<p>Well because the world (esp. The USA which is still one out of the two engines of world economics and then was the only), came to know that super Laissez Faire might sometime bite in the back and there is a risk involve in this type of growth. Laissez Faire is the best and most efficient to grow economy, but there is risk involved. The East which was still developing developed a dislike of the system too.</p>
<p>Now that humans saw risk in the choice of Laissez Faire, they chose another less risky option: Deglobalization</p>
<p><a href="https://en.wikipedia.org/wiki/Brexit">Brexit - Wikipedia</a></p>
<p><a href="https://en.wikipedia.org/wiki/Presidency_of_Donald_Trump">Presidency of Donald Trump - Wikipedia</a></p>
<p><a href="https://en.wikipedia.org/wiki/China–United_States_trade_war">China–United States trade war - Wikipedia</a></p>
<p>If you think this is a term I am making up:</p>
<p><a href="https://www.economist.com/open-future/2019/06/28/globalisation-is-dead-and-we-need-to-invent-a-new-world-order">Globalisation is dead and we need to invent a new world order</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image42.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image43.png" alt="" /></p>
<p>Sounds Familiar, eh ?</p>
<p>So wait, why did it all wait till 2016 when the financial crisis was in late 2000s ?</p>
<p>Laisez Faire is simple. Supply should have met demand. We would have reached an equilibrium after financial crisis. This would have let companies fail and we would have had a smaller economy which would have developed back again. In the long term, the impact would have been removed. But in the short term, there would have been painful compromises. This was not acceptable to the rich and powerful. Governments came in to save their “too big to fail” with their money printers and bonds. This caused a <a href="https://www.investopedia.com/terms/d/disequilibrium.asp">Disequilibrium Definition</a></p>
<p>for a few years which slowly changed the face of the world economy. Disequilibrium eventually gives way to a new and different equilibrium. This is what we have today, the Deglobalized economy.</p>
<p><a href="https://www.bbc.com/news/business-45493147">How the crisis accelerated the rise of China</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image44.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image45.png" alt="" /></p>
<p>So yeah, a lot of economists don’t expect growth rates like globalized era in the upcoming times. They even probably want to move away from GDP as a measure of success to other factors like Economic Satisfaction or PCI. The world is not the same as the world where China (with the same economic policies that President Trump hates so much now) was invited to WTO and almost accelerated to 10% growth by the entire world :</p>
<p><a href="https://slate.com/business/2016/09/when-china-joined-the-wto-it-kick-started-the-chinese-economy-and-roused-a-giant.html">Bill Clinton’s Last Great Victory Is the Reason Hillary Gets Hammered on Trade Today</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image46.png" alt="" /></p>
<p>So yeah, 10% acceleration because of the world backing us doesn’t look possible in the current environment. That has been the way Germany and Japan and China developed after World War 2. <strong>The tested and tried recipe won’t work, we need something new.</strong></p>
<p>What is it then ?</p>
<p>Deglobalization reduces growth rates for all, but large economies and countries suffer comparatively less. They can exploit their own ecosystem to create growth, the harm is that it creates Oligarchy.</p>
<p>Smaller economies effectively become a colony of one of the larger company.</p>
<p>EU for example under the disguise of “privacy” has been creating deterrence for companies from outside :</p>
<p><a href="https://www.cnet.com/news/france-builds-whatsapp-like-service-to-fight-privacy-breach/">France builds WhatsApp-like service to avoid privacy breaches</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image47.png" alt="" /></p>
<p><a href="https://thenextweb.com/podium/2019/10/01/how-regulation-brought-innovation-back-to-european-tech/">How regulation brought innovation back to European tech</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image48.jpeg" alt="" /></p>
<p>China, already has created a huge deterrence for outside companies doing in China by its IP laws, which basically enables Chinese locals to create a local cheap copycat of external companies:</p>
<p><a href="https://www.bloomberg.com/news/articles/2018-12-05/what-s-intellectual-property-and-does-china-steal-it-quicktake">What Is Intellectual Property, and Does China Steal It?</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image49.png" alt="" /></p>
<p>In case of internet companies, it has created a deterrence by the Great Chinese Firewall</p>
<p><a href="https://www.travelchinacheaper.com/index-blocked-websites-in-china">What Websites and Apps are Blocked in China? (Updated August 2019)</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image50.png" alt="" /></p>
<p>This essentially has given rise to China’s own ecosystem of internet products:</p>
<p><a href="https://lingohub.com/blog/2019/03/market-spotlight-china-app/">Market Spotlight: Crash Course on China’s app ecosystem</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image51.png" alt="" /></p>
<p>And China is selling its products to smaller countries (along with its own market) to drive growth.</p>
<p>Meanwhile, in India, we have to still choose whether we want to be a pole of this upcoming multipolar world or an economic colony. There seems to be some strategy, but there is a lot of politics and “what’s the right way” discussion.</p>
<p>Look at BBC (and Technology “Expert” Mr. Prashanto Roy) criticizing a similar move by India as if India is doing a big crime here:</p>
<p><a href="https://www.bbc.com/news/world-asia-india-50582728">India may cite Pegasus row to store data locally</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image52.png" alt="" /></p>
<p>Let’s talk more, our apps are loosing to Chinese ones :</p>
<table>
<tbody>
<tr>
<td>[The Chinese takeover of Indian app ecosystem</td>
<td>FactorDaily](https://factordaily.com/the-chinese-takeover-of-indian-app-ecosystem/)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image53.png" alt="" /></p>
<p><em>India was unfortunately a closed economy during globalization times and delayed the opening up too much (we opened our economy after Communist China !) and now that tactically closing some parts is required, we are getting slow too.</em> This is what is going to drive growth if globalization dies like what it seems to be doing now. Our economists need to figure out a way to squeeze the last bot of globalization advantages to develop our local ecosystem.</p>
<p><strong><em>2. Black v/s White</em></strong></p>
<p>Another hitch which seems to slowing down the GDP as of now is the war on Black Money. PM Modi has been very serious about it.</p>
<p><a href="https://www.business-standard.com/podcast/current-affairs/modi-2-0-na-khaunga-na-khane-dunga-drive-takes-12-top-taxmen-s-jobs-119061100329_1.html">Modi 2.0 ‘Na Khaunga, Na Khane Dunga’ drive takes 12 top taxmen’s jobs</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image54.png" alt="" /></p>
<p>“Na Khaunga, Na Khaane doonga” means I will not eat (people’s money), neither let others eat (people’s money).</p>
<p>There are two moves that have effectively halted black money in India : <a href="https://en.wikipedia.org/wiki/2016_Indian_banknote_demonetisation">2016 Indian banknote demonetisation - Wikipedia</a></p>
<p>and <a href="https://en.wikipedia.org/wiki/Goods_and_Services_Tax_\(India\)">Goods and Services Tax (India) - Wikipedia</a></p>
<p>While a lot of people will argue about whether these had any effects or not and I could respond by saying that <em>I have personally seen people putting their black money into very high risk investments to get rid of notes during demonetization which they are still trying to get a handle onto</em>, let me prove this by Economic theory.</p>
<p>Simple economics says that when a lot of credit is available for something (that is demand is inflated) , the prices should rise, just by simple <a href="https://crushthecpaexam.com/accounting-glossary/what-is-an-economic-surplus/">Economic Surplus [Definition + Examples]</a></p>
<p>concept. There would be a equilibrium established later where the cost would get stable, but there is no way in hell that prices can go down. Right ?</p>
<p>Check this out!</p>
<p>Indians have been given too many loans for Housing and Vehicles in last 4 years:</p>
<p><a href="https://economictimes.indiatimes.com/wealth/borrow/indian-households-debt-doubles-in-fy17-18-what-are-we-borrowing-for-and-how-much/articleshow/67700374.cms?from=mdr">Indian households’ debt doubles in FY17-18: What are we borrowing for and how much?</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image55.png" alt="" /></p>
<p>(Just to add, Indian consumer loans are comparatively very fraud proof where the money is generally given only after many levels of check and a three party system dealer/builder - consumer - bank is followed. You can safely assume that these are mostly genuine loans).</p>
<p>So you should see a boom in the vehicle and housing sectors (and conversely a slump in consumer durables given loans are not being given there). The government/central bank is basically forcing a boom. But you dont.</p>
<p>From Reuters:</p>
<p><a href="https://www.reuters.com/article/us-india-realestate-banking-insight/realty-bites-indian-property-slump-leaves-beleaguered-banks-exposed-idUSKBN1WS03N">Realty bites: Indian property slump leaves beleaguered banks exposed</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image56.png" alt="" /></p>
<p><a href="https://economictimes.indiatimes.com/wealth/real-estate/property-prices-have-fallen-slightly-in-most-major-indian-cities-in-past-one-year-report/articleshow/70203447.cms">Property prices have fallen slightly in most major Indian cities in past one year: Report</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image57.png" alt="" /></p>
<p><strong>So more money than before into real estate but they are still “out of money”.</strong> This basically cannot happen, unless, there was a parallel economy earlier which was way larger than even the artificial inflation government has induced.</p>
<p>It was very common for builders to ask for payments in 50%+ black money just a few days back.</p>
<p>Same with vehicles:</p>
<p><a href="https://www.businesstoday.in/sectors/auto/maruti-suzuki-car-sales-india-fall-again-in-november-decline-slowdown-blues-indian-economy-carmaker-auto-industry/story/391319.html">Slowdown Blues: Maruti sales fall again in November, decline 3.3%</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image58.png" alt="" /></p>
<p>This while it is so easy to get a car loan these days. I can get a vehicle with Zero down payment, just on easy EMIs.</p>
<p>The car thing is more complex though, there are other issues like rise (and then stagnation) of Ola/Uber, <a href="https://en.wikipedia.org/wiki/Peak_car">Peak car - Wikipedia</a></p>
<p>, super easy personal loans for Ola/Uber drivers now getting more real and less bubble-y. But you get that despite this combination, this is anomaly.</p>
<p>How much black money was there that it can hurt economy so much ?</p>
<p>Well some not-so-small amount, but its buying power was huge. <em>Black money is more liquid</em> than white money which is typically invested in bank/stocks and circulates more.</p>
<p>When you spend a 10 Rupee note into economy, it is not just 10 rupees of GDP. It gets spend many times to make payments (and was spent many times as credits to get you the thing you wanted to buy on credit). With so much of liquid black money stopping, you could expect some good ripple effect.</p>
<p>[Before you comment, one person’s black money can become other’s while money and hence killing the black money does kill white money too. There are consequences of doing anything, even removing black money from economy.]</p>
<p>The small trader effected by GST excuse politicians make didn’t find too much support on ground during Modi’s relection with even larger mandate because in back of mind, most Indians were clear that black money needs to stop.</p>
<p><strong><em>3. Who bells the Cat ?</em></strong></p>
<p>Coming out of black money economy is a good thing. Corruption in general is lower. <a href="https://asia.nikkei.com/Opinion/In-defense-of-Modi-s-corruption-record">In defense of Modi’s corruption record</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image59.png" alt="" /></p>
<p>I am from a family of government servants and people in my extended family who are still are in government jobs continuously keep cribbing about their government jobs being less “satisfactory”. Smart columnists keep cribbing about “but there is still corruption”, but people can get a signal about what happened there.</p>
<p>The following is what needs to be done:</p>
<ol>
<li>
<blockquote>
<p>Low Corporate Tax (government already did this).</p>
</blockquote>
</li>
<li>
<blockquote>
<p>As long as effective center of control of companies stays in India, there should be no hindrance to money coming into company from outside. 100% FDI maybe.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Black Money and taxation to be good (somewhat implemented). GST seems to be getting better: <a href="https://economictimes.indiatimes.com/news/economy/finance/finally-some-good-news-november-gst-collections-up-6/articleshow/72316599.cms">Finally, some good news: November GST collections up 6%</a></p>
</blockquote>
</li>
</ol>
<!-- end list -->
<ol>
<li>
<blockquote>
<p>We have to build large companies and enterprises within. With deglobalization being the trend in the world, we will need big in house companies who can sign big cheques and take big risks. Small traders and local enterprises won’t be able to do so. That or we take the thought of being a world leader out of our head and keep playing psychological standstill. Unless globalization comes back into fashion again (not that probable) , in which case we should just open economy up more.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Privatizing PSUs. We already have some large companies (as said in 4), but they are not really efficient. This makes our PSUs efficient. (Already being done)</p>
</blockquote>
</li>
</ol>
<p>Now these are not things that will be easy, these are bold decisions that WILL hurt some people (some of which are core Modi votebanks). Probably the reason why Modi was given such a strong mandate that he doesn’t need to worry about people getting unhappy, but despite all of this, he is a democratic leader and needs to worry about his image. We have to see what we can pull off.</p>
<h3 id="my-answer-to-what-are-the-challenges-being-faced-by-the-indian-government-while-growing-the-economy-of-the-country">My answer to “What are the challenges being faced by the Indian government while growing the economy of the country?”</h3>
<p>Originally Answered Here:</p>
<p>Before you read my answer, a disclaimer that <em>I am not an economics expert.</em> This is just log of my observations.</p>
<table>
<tbody>
<tr>
<td>Let’s keep something clear, our economy is growing, but not growing at a rate it used to. None of the world economies (except United States) is really doing better than it was say 5 years back. China’s 6% GDP growth rate is widely understood to be a flawed number [Subscribe to read</td>
<td>Financial Times](https://www.ft.com/content/961b4b32-3fce-11e9-b896-fe36ec32aece)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image60.png" alt="" /></p>
<p>and Germany is very close to a recession (India is not in a recession, its a time for low growth, recession means negative growth). Germany’s economic growth were -0.1% and 0.1% in successive quarters.</p>
<p><a href="https://www.thelocal.de/20200106/plunging-german-car-production-heralds-year-of-transformation">Why has German car production hit a 22-year low?</a></p>
<table>
<tbody>
<tr>
<td>[Subscribe to read</td>
<td>Financial Times](https://www.ft.com/content/a6df76e8-06aa-11ea-a984-fbbacad9e7dd)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image61.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image62.png" alt="" /></p>
<p>These are stats from the few economies larger than India. Smaller economies are growing (like say Bangladesh, Vietnam, Ethiopia), but they are really nothing in comparison. <em>Total economy growth of the world last year was dominated by two countries, China and India, despite both being in an economic slowdown.</em></p>
<p>Net-net , India’s economy is not doing bad as compared to the world right now, its doing way worse than what it was doing in the past in terms of growth. There are some things where its actually doing better too :</p>
<p><a href="https://www.quora.com/Is-it-true-that-India-is-doing-better-than-ever-on-many-key-indicators">Is it true that India is doing better than ever on many key indicators?</a></p>
<p><em>I hope its clear that the question is not about whether we can do whether with respect to contemporary world, but can we do way better than the world. You should understand that is a hard challenge.</em></p>
<p>Some challenges Indian government faces when they try to push the economy up:</p>
<p><strong>Lack of easy capital :</strong></p>
<table>
<tbody>
<tr>
<td>There was a time when the neoliberal order was investing in developing countries like there is no tomorrow. China became China because west invested “a lot” into them and made them what they are today. [Subscribe to read</td>
<td>Financial Times](https://www.ft.com/content/9ebf9e36-1271-11e8-940e-08320fc2a277)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image63.png" alt="" /></p>
<p><a href="http://press-files.anu.edu.au/downloads/press/p214211/pdf/9.-The-impact-of-WTO-accession-on-FDI-Chen-Chunlai.pdf">http://press-files.anu.edu.au/downloads/press/p214211/pdf/9.-The-impact-of-WTO-accession-on-FDI-Chen-Chunlai.pdf</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image64.png" alt="" /></p>
<p>Let’s be clear about this, having money and then spending it correctly is what gets industries/businesses established, which begets jobs, new middle class is formed and prosperity comes home. Comparatively, here is what India raised during that time:</p>
<p><a href="http://www.yourarticlelibrary.com/india-2/foreign-direct-investment-fdi-in-india-since-1991/47523">Foreign Direct Investment (FDI) In India (Since 1991)</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image65.png" alt="" /></p>
<p>If you understand compound interest, you can understand how that wealth might grow in countries if they manage the money well. We need money + we need to manage the money well to become a good economy. Only in 2015, we could start getting FDI comparable (and even slightly more) to China :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image66.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/Foreign_direct_investment_in_India">Foreign direct investment in India - Wikipedia</a></p>
<p>Now assuming we manage money as good or better than China (discussion on that later), we would now slowly need compounded growth + investment over time to be as good as China say. However, with the old economic order falling and the old fashioned mercantile system coming back, investments are becoming lower and India is trying really hard to just keep the FDI per year intact.</p>
<p><a href="https://in.reuters.com/article/us-imf-worldbank-trade/fallout-from-trumps-trade-wars-felt-by-economies-around-the-world-idINKBN1WY0PZ">Fallout from Trump’s trade wars felt by economies around the world</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image67.png" alt="" /></p>
<p>In an old fashioned climate, FDI would have fallen, but with ease of business etc going up, at least we are seeing somewhat consistent FDIs. But they have not really gone up.</p>
<p><a href="https://www.ibef.org/economy/foreign-direct-investment.aspx">FDI in India: Foreign Direct Investment Opportunities, Policy</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image68.png" alt="" /></p>
<p>So yes, the environment is changing and we can see some effects of it. FDI is somewhat risk-free investment in a sense that if you can create confidence amongst investors, you don’t have to give anything up to receive it. All you need to make sure is you show you have a good legal system to recover money if lost and a growing economy that will give returns. With media reporting negative things all the time just when the growth rate has gone down a bit, its a vicious cycle, negativity rises even more and the government has to counter that too to keep the FDI tap running (and probably increasing).</p>
<p>You also have to understand that to drive GDP growth the base changes every year, so one has to spend more and more. For example you spent 2 rupees to grow economy from INR 100 to 106 (viz 6%), it is very good that next year the economy grows by 6% again (6% of 106 is around 6.4 INR) by spending lesser, but most of the time you need to spend as much or even more. You can call it bubble or whatever, but that’s how most economies work. You can either finance this through FDI (least risky method) by maintaining a good name and goodwill, or by inflation (like how previous governments did it) or by debts.</p>
<p>Current government has a principle to keep inflation stagnant and with stagnant FDI, India has to look into more risky methods like:</p>
<p><strong>Debt:</strong></p>
<p>Good old debts and bonds. Unlike China (now-a-days) and Japan(since the 1980s) who have gone on a debt spree to increase local consumption to boost economy , India has been fiscally more responsible. <a href="https://en.wikipedia.org/wiki/Fiscal_Responsibility_and_Budget_Management_Act%2C_2003">Fiscal Responsibility and Budget Management Act, 2003 - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image69.png" alt="" /></p>
<p>China on the other hand uses debt as a method to boost local growth :</p>
<table>
<tbody>
<tr>
<td>[Does China face a looming debt crisis?</td>
<td>ChinaPower Project](https://chinapower.csis.org/china-face-looming-debt-crisis/)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image70.png" alt="" /></p>
<p>You could consider this a positive or negative thing in China’s case, but they have at least been successful in pushing all the debt towards growth. This will hopefully give them long term returns is what they think.</p>
<p>There is infact common advice that India does this too :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image71.png" alt="" /></p>
<p>However, debts unlike FDI are less directed. have no KPIs attached to them and hence there is a high chance of misuse of funds into liabilities than assets. FDIs are almost always invested into businesses or real estate. Debts can be used wherever. Its very easy to secure debt for India’s finance growth, but the government doesn’t want it.</p>
<p><a href="https://economictimes.indiatimes.com/news/economy/indicators/india-plans-to-cut-spending-to-curb-deficit-may-hurt-growth/articleshow/73131664.cms">India plans to cut spending to curb deficit; may hurt growth</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image72.png" alt="" /></p>
<p>And it is somewhat correct. Democracies don’t have good record of spending money on things that would lead to sustained growth. Greece hosts olympics and Argentina just keeps giving government jobs with the debts they receive. China manages it slightly better because there are no elections so it can invest in long term things, say making electric cars slightly cheaper and by stopping giving cheaper petrol car license plates. Chinese use their extended bureaucracy to keep a tight control on the debt money by government officials, then state owned banks and state owned companies. Democracies work on election cycle so they will invest in short term things, which generally will not sustain growth.</p>
<p><a href="https://en.wikipedia.org/wiki/Greek_government-debt_crisis">Greek government-debt crisis - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image73.png" alt="" /></p>
<table>
<tbody>
<tr>
<td>[Subscribe to read</td>
<td>Financial Times](https://www.ft.com/content/9161f0c0-caff-11e9-a1f4-3669401ba76f)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image74.png" alt="" /></p>
<p>So yes, that is condition, you can fund growth through 1. FDI (people buying stake in the country), 2. Debt(Taking money as loan), 3. Inflation(people paying for the growth by depreciating values of their assets). 1 is slightly harder to increase, 2 is a generally avoided by India, 3. Current government is a populist government, so they dont want to hurt their voter base.</p>
<p>So government has to now focus on growing economy through the hard way : Efficiency. “A rupee saved is a rupee invested”</p>
<p><strong>Economic Efficiency:</strong></p>
<p>When you cannot grow by investment, you have to grow by increasing efficiency. If you haven’t observed, the government is acting on it.</p>
<p>Government has merged Public sector banks to form large stable banks. Also the banking system is back to profitable after a long time. India had a huge bad retail loans crisis in 2010s.</p>
<p><a href="https://economictimes.indiatimes.com/news/economy/policy/nirmala-sitharaman-announces-fresh-reforms-special-agencies-to-monitor-loans-above-rs-250-crore-to-avert-another-nirav-modi-like-situation/articleshow/70909169.cms">Nirmala Sitharaman announces big reforms for Public Sector Banks: Key highlights</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image75.png" alt="" /></p>
<p><a href="https://economictimes.indiatimes.com/markets/stocks/earnings/indian-banks-q2-net-increases-13-to-rs-359-crore/articleshow/71725574.cms?from=mdr">Indian Bank’s Q2 net increases 13% to Rs 359 crore</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image76.png" alt="" /></p>
<p>Large and inefficient government companies are being disinvested to turn into efficient ones:</p>
<p><a href="https://www.thehindubusinessline.com/opinion/quick-take/psu-disinvestment-strategically-right/article30046722.ece">PSU disinvestment: Strategically right</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image77.png" alt="" /></p>
<p><a href="https://transfin.in/govt-panel-approves-rolling-out-of-150-private-trains-on-100-routes">Government Panel Approves Rolling Out of 150 Private Trains</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image78.png" alt="" /></p>
<p>Encouraging startups and innovations are other ways to do things more efficiently. Government has taken steps their as well :</p>
<p><a href="https://www.startupindia.gov.in/content/sih/en/ams-application/challenge.html?applicationId=5d07381fe4b08f8b1a9c75da">Challenge</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image79.png" alt="" /></p>
<p><a href="https://inc42.com/buzz/isro-to-support-space-startups-with-incubation-programme/">ISRO To Support Space Startups With Incubation Programme</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image80.png" alt="" /></p>
<p><a href="https://www.makeinindiadefence.gov.in/pages/defence-india-startup-challenge">Make In India Defence Production: Pages</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image81.png" alt="" /></p>
<p><a href="https://inc42.com/buzz/india-startup-policy-e-auction-defence-india-startup-challenge-and-more/">Startup Policy Rundown: Govt Launches E-Auction Platform, 3rd Defence India Startup Challenge And More</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image82.png" alt="" /></p>
<p>These types of news articles are common throughout India, different state governments and central governments are trying to use technology for more efficient methods to run the economy. Its just a start and will take some time to show results, but none the less this is the way to do things efficiently when the investments are lesser.</p>
<p>India is trying to take a lesson from Israel here:</p>
<p><a href="https://www.information-age.com/israels-tech-start-up-scene-123479255/">Israel’s tech start-up scene: the heartbeat of the economy</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image83.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image84.png" alt="" /></p>
<p>R\&D, the other very important thing for a innovation-driven (or efficient) economy is something India needs to focus on. India’s research ecosystem is just a white elephant, we have too many scientists and many of them are basically teachers or people who have evolved using system’s inefficiency. India needs more scientists who can actually “get shit done”.</p>
<p>Government has of course thought about this too :</p>
<p><a href="https://www.indiatoday.in/india/story/pm-narendra-modi-drdo-new-laboratory-scientists-under-35-young-232417-2014-12-22">After PM prodding, DRDO looks to set up new lab with scientists under 35</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image85.png" alt="" /></p>
<p><a href="https://economictimes.indiatimes.com/news/politics-and-nation/pm-urges-young-scientists-to-innovate-patent-produce-and-prosper/articleshow/73080399.cms">PM urges young scientists to “innovate, patent, produce and prosper”</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image86.png" alt="" /></p>
<p>As you can probably guess, this is slow because the old guard is not always so receptive. Just yesterday, a nation-wide strike was called in government companies/enterprises to protest against the reforms.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image87.png" alt="" /></p>
<p>No one is really “going after” jobs, just that employees will become private sector employees. I am not sure if you can recognize the flags in strike photo in the screenshot above, but I will share the logo of the banking organization whose head is being interviewed by Reuters as an expert in the article. Rings a bell ?</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image88.png" alt="" /></p>
<p>Large public-owned enterprises ? get a hint!!</p>
<p>Another big challenge is getting our workforce to be more efficient. There are specialized jobs in the economy, but students entering universities are often not aware of what to study. Government is trying to get youth achieve employment skills for cheap/free, but we still have to see where it goes.</p>
<p><a href="https://www.msde.gov.in/nationalskilldevelopmentcorporation.html">https://www.msde.gov.in/nationalskilldevelopmentcorporation.html</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image89.png" alt="" /></p>
<p>So yes, many challenges for the government ahead. They are trying to solve them and the future will tell what course our economy takes.</p>
<h3 id="my-answer-to-is-it-true-india-is-doing-better-than-ever-on-many-indicators">My Answer to “Is it True India is doing better than ever on many indicators”</h3>
<p>Originally Answered Here: <a href="https://qr.ae/TS3Xa5">https://qr.ae/TS3Xa5</a></p>
<p>My answer was written long before the 2020 stock market crash due to CoronaVirus fear and Stock Markets during 2020 {the next year} were totally tanked.</p>
<p>Some metrics on which India is doing very good (and in some cases the best ever):</p>
<p><strong>Stock Markets:</strong></p>
<p><a href="https://www.businesstoday.in/markets/stocks/share-market-live-sensex-nifty-trading-on-december-17-2019-yes-bank-cipla-arcelor-mittal/story/392174.html">https://www.businesstoday.in/markets/stocks/share-market-live-sensex-nifty-trading-on-december-17-2019-yes-bank-cipla-arcelor-mittal/story/392174.html</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image90.png" alt="" /></p>
<p><strong>Forex Reserves:</strong></p>
<p><a href="https://www.indiatoday.in/business/story/forex-reserves-hit-record-high-at-457-46-billion-1633770-2020-01-03">Forex reserves hit record high at $457.46 billion</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image91.png" alt="" /></p>
<p><strong>Debt to GDP Ratio</strong></p>
<p><a href="https://economictimes.indiatimes.com/news/economy/finance/indias-debt-lower-than-best-emerging-market-economies-imf/articleshow/66147583.cms?from=mdr">India’s debt lower than best emerging market economies: IMF</a></p>
<p>India’s Debt to GDP ratio is at one of its best positions ever</p>
<p><strong>India’s banking sector has finally unscrewed itself</strong></p>
<p><a href="https://www.businesstoday.in/sectors/banks/after-two-successive-years-of-losses-banking-sector-turns-profitability-in-first-half-of-fy20/story/392599.html">After two successive years of losses, banking sector turns profitable in first half of FY20</a></p>
<p><strong>Ease of doing business is better</strong></p>
<p><a href="https://economictimes.indiatimes.com/news/economy/indicators/india-jumps-to-63rd-position-in-world-banks-doing-business-2020-report/articleshow/71731589.cms?from=mdr">India jumps to 63rd position in World Bank’s Ease of Doing Business 2020 report</a></p>
<p><strong>Number of patents is going up (so hopefully we are innovating more):</strong></p>
<p><a href="https://gadgets.ndtv.com/wearables/news/iit-delhi-files-150-patents-in-2019-highest-ever-in-a-year-2155072">IIT Delhi Files 150 Patents in 2019, Highest Ever in a Year</a></p>
<p><strong>GST collections are (finally) going up, so (hopefully) consumer spending is back !</strong></p>
<p><a href="https://www.financialexpress.com/economy/gst-collections-check-which-state-topped-collection-in-december-how-much-tax-other-states-got/1811984/">GST collections: Check which state topped collection in December, how much tax other states got</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image92.png" alt="" /></p>
<p><strong>Businessmen will finally not get arrested for failing at a business (aka we now have a bankruptcy reform)</strong></p>
<p><a href="https://timesofindia.indiatimes.com/business/india-business/gst-bankruptcy-code-to-help-indian-economy/articleshow/73052007.cms">‘GST, bankruptcy code to help Indian economy’ - Times of India</a></p>
<p>We need to work on our slow economic growth during last few quarters no doubt, but all hope is not lost.</p>
<ol>
<li>
<h2 id="other-issues-">Other Issues :</h2>
<ol>
<li>
<h3 id="my-answer-to-if-the-rest-of-india-doesnt-have-a-problem-with-the-farmer-bill-why-doesnt-the-government-just-withdraw-the-bill-from-punjab-and-revoke-any-more-benefits-to-them-as-well-2020-21-farmer-protests">My answer to “If the rest of India doesn’t have a problem with the farmer bill, why doesn’t the government just withdraw the bill from Punjab and revoke any more benefits to them as well?” [2020-21 Farmer Protests]</h3>
</li>
</ol>
</li>
</ol>
<p>Originally answered here: https://qr.ae/pNaMiZ</p>
<p>Punjab is just in a unique situation. The status quo which kept farmers incomes low throughout India and had many inefficiencies was actually successful in Punjab due to internal efficiencies of Punjab.</p>
<p>Post independence from British, the zamindari was abolished limiting how big a farmers land holdings can be and land was distributed to farmers. However, in Punjab (and Haryana), these land holdings were much more consolidated in hands of a few from colonial period. Land ceiling killed individual ambitions, but a community based consolidation survived.</p>
<blockquote>
<p><a href="https://frontline.thehindu.com/the-nation/punjab-land-struggle-in-the-time-of-pandemic/article32024163.ece">Punjab: Land struggle in the time of pandemic</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image93.png" alt="" /></p>
<blockquote>
<p>When during the <a href="https://en.wikipedia.org/wiki/Green_Revolution">Green Revolution - Wikipedia</a></p>
</blockquote>
<p>in the 1960s, India was looking to scale up its food production and stock up grains to feed its then poor population, Punjab was in a unique situation to invest and take loans as compared to others due to consolidation.</p>
<blockquote>
<p><a href="https://www.theindiaforum.in/article/agrarian-crisis-punjab-and-making-anti-farm-law-protests">The Agrarian Crisis in Punjab and the Making of the Anti-Farm Law Protests</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image94.png" alt="" /></p>
<p>The consolidation of land in the hands of the few and supply of cheap labor from Uttar Pradesh and Bihar actually built somewhat of a one community driven corporate farming industry in Punjab making it a much more efficient business than small, unorganized and individual farmers in rest of India. Inequality/Oligopoly has its disadvantages, but businesses built in this way are much more profitable and stable. Farmers in the region with large land holdings (or organized large holdings) when combined with cheap labor from UP and Bihar, basically build up a money making machine.</p>
<blockquote>
<p>Unlike Punjab, farms in other states of India are relatively better (not perfect but less unequally) distributed among conflicting castes and sects. Better distribution means less organization and consolidation. That basically means less profits and thus poor investments and worse incomes. Farmers in rest of the country need a way to scale their agriculture according to market economics. Look how poorly they compete against Punjab : <a href="https://www.msn.com/en-in/news/other/new-agri-bills-punjab-farmers-a-pampered-lot-protest-easily/ar-BB1bvByg">New Agri Bills: Punjab farmers, a pampered lot, protest easily</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image95.png" alt="" /></p>
<blockquote>
<p>Government procures 90% of grains of Punjab for India’s PDS - <a href="https://en.wikipedia.org/wiki/Public_distribution_system">Public distribution system - Wikipedia</a></p>
</blockquote>
<p>[Where it guarantees a subsidy on grains ensuring high prices]. Most farmers from rest of India, hardly get to sell their grains at the same cost. <em>This is such inefficiency that the farmers are paid good money only for the food poorest people eat.</em> There is a huge layer of middlemen that leak the money India’s middle class, rich and exports pay and none of that reaches the farmer. All taking help of inefficiencies. The aim of country should not be to ensure just MSP, but make farmers so efficient that they can market and sell their goods at the right forum at the right price.</p>
<blockquote>
<p>Thus, while Punjab’s farmers want to keep the status quo, rest of the country has news of farmer distress : <a href="https://en.wikipedia.org/wiki/Farmers'_suicides_in_India">Farmers’ suicides in India - Wikipedia</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image96.png" alt="" /></p>
<p>These are states with unorganized farming and relatively poor lands. These farmers will never be able to meet Market Economics unless they become efficient like how Punjab’s farmers are. We don’t want a land consolidation like Punjab in rest of India, so the way is to push free market efficiency to make these farmers become competitive. That is what the recent bills introducing agricultural reforms do. They follow Shanta Kumar commission’s reports to make agriculture in India more efficient.</p>
<p>There are Punjabi farmers showing foodgrains from malls as things being sold on high prices and being procured from them at low cost. The truth is most of Punjab’s grains are used to food poor people for free !</p>
<blockquote>
<p>Even for government procurement Shanta Kumar committee basically suggested to : <a href="https://fci.gov.in/app2/webroot/upload/News/Report%20of%20the%20High%20Level%20Committee%20on%20Reorienting%20the%20Role%20and%20Restructuring%20of%20FCI_English.pdf">https://fci.gov.in/app2/webroot/upload/News/Report%20of%20the%20High%20Level%20Committee%20on%20Reorienting%20the%20Role%20and%20Restructuring%20of%20FCI_English.pdf</a></p>
</blockquote>
<p>A. Make Infrastructure better for better transport :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image97.png" alt="" /></p>
<p>B. Embrace free market in grain storage:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image98.png" alt="" /></p>
<blockquote>
<p>Please note that the “mandi” system which works relatively in Punjab (northwest) has been also dubbed for reforms to make them efficient. <a href="https://en.wikipedia.org/wiki/Agricultural_produce_market_committee">Agricultural produce market committee - Wikipedia</a></p>
</blockquote>
<p>. This is btw, a report on procurement by government for PDS we are talking about here. The agricultural reforms introduce procurement by private firms directly for retail as well.</p>
<blockquote>
<p>Mandis in Punjab and Haryana are inefficient and the nation loses billions of dollar every year procuring from them. Since these grains are eaten by poorest of poor, no one cares about their quality.<a href="https://thewire.in/agriculture/the-government-must-act-on-the-cags-damning-report-on-rice-milling-and-paddy-procurement">The Government Must Act on the CAG’s Damning Report on Rice Milling and Paddy Procurement</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image99.png" alt="" /></p>
<p>Unfortunately, this inefficient Mandi system is what gets the best price for farmers.</p>
<p>The latest agricultural reforms basically enable the following :</p>
<ol>
<li>
<blockquote>
<p>Farmers don’t need to necessarily sell to Mandis. They can sell to Mandis if they want a collective bargain.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Private players can procure directly from farmers.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Infrastructure should be made better so that unorganized farmers aren’t at a disadvantage.</p>
</blockquote>
</li>
</ol>
<blockquote>
<p>I agree that a Mandi needs to be given some special privilege when fighting against a multinational as they cannot dump enough money as predatory capitalism. The right way is to empower the mandis to give a fair competition and thus forcing them to get more market driven and competitive rather than hiding behind procurement for PDS which is a comfort zone. Government is ready to back mandis in competition with private players : <a href="https://menafn.com/1101239031/Tomar-APMC-will-be-strengthened-Modi-govt-fully-committed-to-farmers-welfare">Tomar: APMC will be strengthened, Modi govt fully committed to farmers’ welfare</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image100.png" alt="" /></p>
<p>Ok. Now I would answer your actual question, why would Punjab farmers might not want to just block the reforms in their state and let the rest of nation go ahead with it :</p>
<p>A. Punjab farmers might be afraid that the monopoly they have in the government procurement may be disturbed if the whole of the country becomes competitive to them given the whole country reforms the agriculture system. Punjab is still expected to be ahead in a reformed agriculture sector due to the inherent advantages it has, but why take any risks.</p>
<p>B. Punjab farmers might be afraid that the monopoly they have in the government procurement may be disturbed if they continue to stick with the old system and the rest of the country moves ahead with reforms as well. BTW, this is the situation we have now. Punjab has blocked the changes to Mandi procurement system (as mandi laws are controlled by state).</p>
<p>C. The only way for Punjab monopoly in PDS procurement to continue is what the status quo till September 2020 was. So they want a rollback of reforms.</p>
<p>E. The protests against corporatization of agriculture is misplaced as Punjab’s agriculture is already a corporate industry. From the above linked article :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image101.png" alt="" /></p>
<p>That said, this Zero Sum Mentality is what keeps people behind. In India :</p>
<p>i. Most money in agriculture will not come from PDS, but from free market. The whole fight is over PDS procurement. Think of how small the fight is in the grand scheme of things.</p>
<p>ii. Farmers should make cooperatives which negotiate on behalf of them and get them prices basis of free market rates. Also educate them about what to produce to increase their income. PM Modi gave some examples of this few days back :</p>
<blockquote>
<p><a href="https://indianexpress.com/article/india/pm-modi-mann-ki-baat-farm-laws-protests-7072658/">PM Modi doubles down on farm laws, says are opening new possibilities</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image102.png" alt="" /></p>
<p>iii. We can have cooperative firms like Amul in agricultural sector too. See some examples in apiculture here :</p>
<p>A recent study says most <a href="https://twitter.com/hashtag/honey?src=hash&ref_src=twsrc^tfw">#honey</a> brand in <a href="https://twitter.com/hashtag/India?src=hash&ref_src=twsrc^tfw">#India</a> are adulterated. Friends here we present forest honey from <a href="https://twitter.com/hashtag/Sundarban?src=hash&ref_src=twsrc^tfw">#Sundarban</a>. Bonphool honey from Sundarban is available online also. Every bottle of honey purchased contributes to conservation & provide livelihood to traditional people. <a href="https://t.co/WKoZA88PE4">pic.twitter.com/WKoZA88PE4</a></p>
<blockquote>
<p>— Parveen Kaswan, IFS (@ParveenKaswan) <a href="https://twitter.com/ParveenKaswan/status/1334331778211794944?ref_src=twsrc^tfw">December 3, 2020</a></p>
</blockquote>
<h3 id="my-answer-to-why-are-farmers-in-haryana-and-punjab-protesting">My answer to “Why are farmers in Haryana and Punjab protesting?”</h3>
<p>Originally answered here: https://qr.ae/pNZrFt</p>
<p>I have answered the question in detail here: <a href="https://www.quora.com/If-the-rest-of-India-doesnt-have-a-problem-with-the-farmer-bill-why-doesnt-the-government-just-withdraw-the-bill-from-Punjab-and-revoke-any-more-benefits-to-them-as-well/answer/Muktabh-Mayank">Muktabh Mayank’s answer to If the rest of India doesn’t have a problem with the farmer bill, why doesn’t the government just withdraw the bill from Punjab and revoke any more benefits to them as well?</a></p>
<p>TL,DR of the answer is :</p>
<blockquote>
<p>* Whole of India’s agricultural sector was very unorganized apart from Punjab (and some parts of Haryana, given Haryana was initially a part of Punjab). This gave Punjab a special monopoly where they were able to sell their crops to government at guaranteed prices. This made the agricultural sector of Punjab more consolidated and powerful. In the rest of the states, farmers could hardly sell their crops anywhere close and there was widespread farmer distress. This is a well known problem in economics called <a href="https://en.wikipedia.org/wiki/Monopsony">Monopsony - Wikipedia</a></p>
</blockquote>
<p>as most farmers had to sell to mandated intermediaries who could pay whatever they want.</p>
<p>* India has liberalized the agricultural markets where farmers can now engage with any buyers who can give them a good price and making them more efficient.</p>
<p>* Farmers in Punjab are however (I think) more afraid about their organized farming industry which churns out money can be disrupted given the rest of country becomes efficient and organized too. This by the way is fear only for losing India’s PDS procurement, which many people know as the MSP issue, which is a small part of the actual agriculture marketplace, most farmers even in Punjab don’t have issue with the other 90% of the reforms. In fact, 10 years back, Punjab farmers protested for similar reforms to be introduced:</p>
<blockquote>
<p><a href="http://archive.vn/WqmkB">http://archive.vn/WqmkB</a></p>
</blockquote>
<p>Punjab farmers getting disrupted however is a low probability event because they will still be ahead of any other state (as they started the race ahead of others), but why accept a non-zero probability of disruption is probably what they think. More stats and details details in the linked answer.</p>
<p>* The rest of the protest is made of perpetual protestors , people who are always in protest mode and will stop the country at whatever event anyone in the country doesn’t like.</p>
<h3 id="my-answer-to-being-liberal-is-good-so-why-are-liberals-hated-so-much-in-india-">My answer to “Being Liberal is good, so why are Liberals hated so much in India ?”</h3>
<p>Originally Answered Here: <a href="https://qr.ae/TS4cmg">https://qr.ae/TS4cmg</a></p>
<p><em>The following is very much my reading of the current political situation in India. I am not an expert on either politics or history, so take this answer with a grain of salt :</em></p>
<p>Indian political scene is filled with misnomers : “Liberals” are not really liberal, “Rationalists” are actually communists, all sides of political spectrum are basically “progressive”, that is want living conditions of humanity to get better with time, “Secular” word is very unclear in definition, “Indian Intellectuals” many a times aren’t intellectuals (many celebrities who are counted as intellectuals haven’t really completed their basic education, they can be called leaders, not intellectual).</p>
<p>So “Being liberal is good” is not really a fact like you have mentioned. It is a statement like saying “Movie X is good”. It is a subjective statement.</p>
<p>You need to understand that the “liberal” politics in India is not really liberal (liberal politics is a different type of politics altogether which has no support base in India), but a mix between Fabian socialism, neoliberalism and identity politics. (essentially the politics of Indian National Congress at different stages during Indian democracy period, which has been in power for most of the time post-independence).</p>
<p>In current context, If you understand that you like the policies implemented by the INC in India, you can definitely call yourself an “Indian Liberal”, but please don’t feel you have a liability to be called “liberal” as the word has a good reputation. You might like the Indian Liberal philosophy, the Liberal(or classic liberal as now it is called, given there is a neoliberal philosophy too) philosophy, none, a mixture of both, whatever you feel like.</p>
<p>As of 2019 , I want to explain (as to how I understand) what is an “Indian Liberal” philosophy and what are they really against in current BJP regime. (And that there is a lot in common too which they should not really be against)</p>
<p><strong><em>The Indian Liberal Political stance</em></strong></p>
<p><strong>1) Fabian Socialism:</strong></p>
<p>I think if you are reading this answer you probably already know what socialism is. Socialism is basically a democratic form of communism which aims at bringing wealth redistribution and state/co-operative ownership of important means of production. By just policy of democratic socialism, Political Communism in India and Socialism are not really different as both comply to electoral means to gain power. (There is also real communism in India which wants to overthrow capitalists through a bloody and warlike revolution, what we know today as <a href="https://en.wikipedia.org/wiki/Naxalite">Naxalite - Wikipedia</a></p>
<p>). However, Fabian thought is what sets them apart.</p>
<p>Fabian thought is slightly different though. <a href="https://en.wikipedia.org/wiki/Fabian_Society">Fabian Society - Wikipedia</a></p>
<p>. It believes that the best form of government is that which is run by an elite and aims to redistribute wealth as a “Socialism run by Aristocracy” (This is not my words, but Annie Besant’s, J.L.Nehru’s political guru).</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image103.png" alt="" /></p>
<p>If you look at Indian politics, most elite people’s families have been elite for generations. Just google a bit about post-Nehru Congress leaders or our artists or mediapersons etc, you will see a lot of them come from elite families (who were quite influential after or sometimes even before independence) and stay elite. They don’t want to show it, try to portray themselves as common people, but they are. Fabian Socialism creates an ecosystem which tries to implement socialism without becoming more populist (We will discuss about the term later).</p>
<p>If you remember before the internet and social media, the only way to understand the depths behind a topic was to read opinions on a topic in newspapers. I used to read opinions and editorials of Indian English newspapers when I was a kid. Thinking of it, a lot of subjective knowledge was passed to me as real knowledge and I probably still believe a lot of it even now. That is the epitome of Fabian society, I was guided into what I believe is right in a lot of topics by elites whom the media thought were experts in their fields.</p>
<p>In India, the way Fabian Socialism works is the following:</p>
<p>1. Highlight weak sections within the majority and become their representative. 2. An elite ecosystem to run the country and create propaganda</p>
<p>3. Meritocracy in executive and technocracy to keep populism in check (the people think they get a say in running government).</p>
<p>The entire concept of dynasty politics is not just limited to politics, but also in media, arts, business, judiciary etc. Fabian thought aims at building an elite which runs the show. In UK, OxBridge educated elite is another example of a similar “socialist aristocracy”: <a href="https://en.m.wikipedia.org/wiki/List_of_University_of_Oxford_people_with_PPE_degrees">List of University of Oxford people with PPE degrees - Wikipedia</a></p>
<p>There is a small inlet for the common people to break into this elite through competitions etc to make sure they are not dissatisfied.</p>
<p>So its not just Nehru-Gandhi family, but a set of families which run the country. They take in a few new elite people and the old ones are retained, keeping their narrative aligned always. They let certain meritorious people into elite who comply with their narrative enriching the ecosystem . Let me explain a bit more.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image104.png" alt="" /></p>
<p>Socialism in my view is basically elite-run Communism. It follows similar goals to communism, but is unlike communism, not brutal and authoritarian, allows for economics to flourish too and makes more rational choices.</p>
<p>There is a somewhat parallel movement in India we had of a more populist (identity politics based) socialism and you have common people rising to become powerful politicians. (Mulayam Singh Yadav, Nitish Kumar, George Fernandes, Lalu Yadav, Kansiram etc ). But since the ecosystem was built to facilitate fabian socialism, they all convert into fabian socialists in the long run. Most of these populist socialist parties have now evolved into what is known as “dynestic politics” parties in India. That is the reason why some people even allege that the BJP is becoming like the Congress (because the country works based on ecosystem and parties have to adopt it to some extent to run the nation). <a href="https://timesofindia.indiatimes.com/home/sunday-times/deep-focus/The-class-of-1975/articleshow/47749948.cms">The class of 1975 - Times of India</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image105.png" alt="" /></p>
<p>If we think in the terms of George Orwell, the INC is the <a href="https://en.wikipedia.org/wiki/Inner_Party">Inner Party - Wikipedia</a></p>
<p>and it has developed an ecosystem that any ruling party has to comply to.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image106.png" alt="" /></p>
<p>In modern context, Socialism’s most important call is to end wealth inequality. Means of production and other philosophies have been replaced by Neoliberalism (including here in India) and welfare state. Only very recently, we are seeing Jeremy Corbyns, AOCs and Bernies of the world bringing the hard left back. Truth is that combining Socialist welfare state with neoliberalism has had some really good consequences for people for countries.</p>
<p>Look at the HDI:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image107.png" alt="" /></p>
<p>Or World Happiness Index:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image108.png" alt="" /></p>
<p>Or quality of life:</p>
<p><a href="https://www.businessinsider.in/thelife/the-23-cities-with-the-best-quality-of-life-in-the-world/articleshow/63382161.cms">The 23 cities with the best quality of life in the world</a></p>
<p>In India, you can roughly equate the AAP government’s work in Delhi to be India’s equivalent to the welfare state. <a href="https://aamaadmiparty.org/aap2019/">Delhi Government Performance Report 2015-2019</a></p>
<p>(That link is from website of the political party itself so yeah, use some salt)</p>
<p><strong>2) Neoliberalism:</strong></p>
<p><a href="https://en.wikipedia.org/wiki/Neoliberalism">Neoliberalism - Wikipedia</a></p>
<p>is a policy that most left-of-center political parties adopted 1990s onwards (Democrats in US, Labor Party in UK, INC in India). Embracing capitalism and globalization as more “efficient” socialism. Neoliberalism basically lets globalization take precedence. As trade increases, prosperity grows, and more money for helping depraved. This sacrifices the goal of finishing “economic inequality” , but no one complains given better circumstances that arise. Parties also become more center in the political spectrum, making them more acceptable.</p>
<p>The other policies of identity politics remain, while the cathedral/ecosystem allows meritocratic entrance not just by meritocratic competitions but also by entrepreneurship. The entrepreneurs who get into the elite using the system is what a lot of critics call “cronies” in modern era. This policy has proven to drive growth. Most modern global multinational companies took their form thanks to neoliberal policies and they became huge. Neoliberalism and multinational giants support and reinforce each other. You can assume that most Forbes companies these days are a product of globalization and Neoliberalism. So is a lot of discoveries and inventions and human achievements.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image109.png" alt="" /></p>
<p>This has definitely made the world a better place:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image110.png" alt="" /></p>
<p>Poor people are getting a better life due to this and in some countries in Africa, the average age is going up by more than 1 year to live every year, that is people have more years to live ahead of them as they get older.</p>
<p>A very nice narrative around this can be found in Enlightenment Now, one of my favorite books, which tells how chasing openness in science, reason, humanism and betterment of people has been achieved in last few years and the world is becoming a better place every day:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image111.jpeg" alt="" /></p>
<p>Indian National Congress was somewhat neoliberal during their stint as UPA governments in 2004–2014. The good thing is you can be socialist and neoliberal both (infact that is the most prevalent form of center-left politics in the world) .</p>
<p><strong>3) Identity Politics:</strong></p>
<p>So how would a minority of elites can run such a huge country on socialism/neoliberalism ? If you basically tell people you want to run a democratic neoliberal government to open up the country, help traders, entrepreneurs and scientists, you will not get even a few votes in a democracy.</p>
<p>The answer is by never letting a majority form. Social Justice is a good concept, but when it is combined with identity politics, it becomes an effective measure to never let the majority unite. Any and every society in the world has its flaws and fault lines. You can effectively make the weaker sections support the elite without a lot of trouble. In India, you have Minority politics, Backward caste politics, Scheduled caste politics, Women politics and so on. This is a brilliant way to keep populism in check. <em>Votebank politics</em> is the common name for this phenomenon in India. All you have to do is positive discrimination to rule.</p>
<p><a href="https://economictimes.indiatimes.com/news/politics-and-nation/minorities-must-have-first-claim-on-resources-pm/articleshow/754218.cms">Minorities must have first claim on resources: PM</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image112.png" alt="" /></p>
<p>Identity Politics does give a feel to marginalized segments of society that they have sway in the society, and that is why it wins.</p>
<p>Unlike intellectuals and elite who respond more to facts, common people respond more to emotion and will respect identity politics shown real and emotional stories of oppression, poverty and struggle.</p>
<p>There is some argument that identity politics actually works: <a href="http://signsjournal.org/currents-identity-politics/walters/">In Defense of Identity Politics - Signs: Journal of Women in Culture and Society</a></p>
<p>But most people disagree:</p>
<table>
<tbody>
<tr>
<td>[Why identity politics benefits the right more than the left</td>
<td>Sheri Berman](https://www.theguardian.com/commentisfree/2018/jul/14/identity-politics-right-left-trump-racism)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image113.png" alt="" /></p>
<p><strong><em>Indian Liberal is against What ?</em></strong></p>
<p>Well, now that I have described in my own definition what an Indian Liberal is, let me describe what are they fighting against:</p>
<p><strong>Modi-ism (This is not really a term, but I don’t really know what we have as an actual term for this phenomenon)</strong></p>
<p>Modern Hindutva, BJP, Modi-ism or whatever terms you want to put to the current phenomenon that has rocked India in terms of politics recently is not a new one. It evolved from Congress itself when it was a big tent party for Indian Independence before it took a decisive fabian socialism turn under Nehru. Unlike most right-of-center parties in the world, Modi’s politics is not really conservative (You can see a lot of people writing “Hindutva is not Hinduism”, that is because not all tenets of our traditional religion is what he aspires to), fiscally socialist(Modi government distributes many freebies to poor people), but yet pro-business (in fact they have sometimes been criticized for being anti-business too). Economically, BJP is closer to Democrats (general democrats, not the left fringe we see these days) than Republicans in US. Modi government is trying to run a version of Obamacare in India. The “Gujrat Model” he wants to bring to the nation is more or less how we define Neoliberalism above. <a href="https://economictimes.indiatimes.com/blogs/et-commentary/growth-in-gujarat-hasnt-been-confined-to-1-of-population/">Growth in Gujarat hasn’t been confined to 1% of population</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image114.png" alt="" /></p>
<p>Economically, the only difference between Modi and previous Indian governments is his openness to let businesses created outside the elite class. He has reduced red tape and number of laws, made getting businesses registered, loaned and closed easier. He also promotes SMEs/MSMEs/startups and pitches them everywhere. This appeal to allow non-elite people in the top is what we will address next.</p>
<p>As an Indian Liberal , you might oppose Modi for the following for just opposition’s sake, but there is not too much ground to this criticism:</p>
<ol>
<li>
<blockquote>
<p>His Neoliberal economics</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Him being “old-fashioned” or “orthodox”</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Socialist policies</p>
</blockquote>
</li>
</ol>
<p>The truth is he is trying to solve the same issues as a Indian Liberal government would try and solve and agrees with you things need to change from the status quo. Sometimes he might come up with similar solutions to what an Indian Liberal government would come up with (with lesser or higher efficiency), sometimes his policies will be radically different.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image115.jpeg" alt="" /></p>
<p>There are two issues however on which there is massive disagreement. These are the fundamental issues which when Modi tries to change, people blame him for changing the “idea of India”</p>
<p><strong>Populism :</strong></p>
<p>The most fundamental difference between Modi’s thought and Indian Liberal thought is who sets the narrative : the majority of people or a set of elite.</p>
<p>Populism is the rule of the majority. Basically Populism means sticking to what the majority thinks is right. Some basic things you can easily guess that the majority in a nation state wants is :</p>
<ol>
<li>
<blockquote>
<p>non-interference in day to day life</p>
</blockquote>
</li>
<li>
<blockquote>
<p>control of morality</p>
</blockquote>
</li>
<li>
<blockquote>
<p>social mobility and</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Social Influence and Relevance</p>
</blockquote>
</li>
</ol>
<p>This puts Populism at odds with the rule of the elite. Let’s see examples of these fundamental differences:</p>
<p>1. <em>More social mobility as long as you dont want to destroy the system.</em> If you respect the system (Nazi Party in Nazi Germany, CPC in China and Communist Party in USSR), you could rise from the bottom of the society to the top.</p>
<p>Stalin ,for example, came from a family of shoemakers:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image116.jpeg" alt="" /></p>
<p>In a elite run state (US from 1990–2016 was a proper neocon-neolib state) , most people who get power even from marginalized sections of society are elite too. Barack Obama, for example, had a more privileged life than most African Americans.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image117.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image118.png" alt="" /></p>
<p><a href="https://www.myacpa.org/blogs/senior-scholar-blog/speaking-place-privilege-why-barack-obama-cant-win-losing-race">Speaking from A Place of Privilege: Why Barack Obama Can’t Win for Losing on Race?</a></p>
<p>As you see above, many people in the community weren’t totally happy with the way he ran his Presidency (Not talking about Republicans who were unhappy with him, I am talking about people who had voted for him expecting him to bring some huge reform for his own community).</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image119.png" alt="" /></p>
<p><a href="https://www.theatlantic.com/politics/archive/2016/12/how-barack-obama-failed-black-americans/511358/">How Obama Failed Black Americans</a></p>
<p>That’s because as an establishment candidate there is only so much he could do (and he was a pretty good President overall), you cannot expect populist policies from him like what these people were expecting.</p>
<p>2. <em>Social Influence of the majority is better and they are left alone:</em> Trump canceling Paris climate accord for coal miners or putting trade embargo on China to make sure manufacturing stays in US are steps that help common Americans live their life without expecting too many changes. This is something majority likes, stressful constant life. Gradual changes is what they want. Elites are strong and well placed to take blow from changes in day to day life, common people are not. That is the reason why their openness-to-change is low. So when populists start placing majority’s comfort above elite policies, well, the common people feel they have more power in society. This is in direct contrast to Identity Politics, where marginalized groups feel they are in power.</p>
<p>In India, Demonetization <a href="https://en.wikipedia.org/wiki/2016_Indian_banknote_demonetisation">2016 Indian banknote demonetisation - Wikipedia</a></p>
<p>which has been told to be a failed move by most experts was loved by most Indians at that time and is still loved even now. Most of us have personal anecdotes of our black money grabbing corrupt government servant or businessmen relatives who had to sweat hard to save their money and might have lost a lot of it. These were the same people who had used the system to their advantage. Majority doen’t really know how RBI says most of currency came back, but we do remember these “elite” rich evil people getting troubled and this amused them, despite the fact they had to face hardships too. Now these people of silent majority don’t come out and interview on television and write editorials on newspapers and so they are hard to find online, but go ask your neighbor from lower middle and lower class and there are stories you would have not heard.</p>
<p>The problem with will of majority is, it is emotional and often sub optimal. Probably because the majority is facing life everyday, they don’t get the context or time to gain the bigger picture. Occam’s Razor is very good, but when you don’t have enough facts, you can often choose a very simple narrative that actually doesn’t even explain the situation but just sounds right to you (Occam’s Razor is for scientific competing hypothesis, but when a simpler non-scientific hypothesis like “Jews are evil” comes into play, it just gets stupid). Unfortunately, that has what has happened with populism in the past.</p>
<p>Populism has been around for a long time, I feel communism is populism in some way and so is Fascism. For example, look at the communist poster here:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image120.png" alt="" /></p>
<p>It is basically hating everyone as an elite except the common working class. <a href="https://en.wikipedia.org/wiki/Bourgeoisie">Bourgeoisie – Wikipedia</a> was basically everyone who did not want what the will of the people was.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image121.png" alt="" /></p>
<p>If you think this was just communism that was against the elite, check out the other star of the show, the nazis :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image122.png" alt="" /></p>
<p>So if you have ever wondered why “People’s Republic of China” has People’s in its name or why Nazi Party’s full name was National Socialist Germans <em>Workers</em> Party. These were populist governments. Populist governments haven’t had the best of reputation:</p>
<p><a href="https://en.wikipedia.org/wiki/Mass_killings_under_communist_regimes">Mass killings under communist regimes - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image123.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/The_Holocaust">The Holocaust - Wikipedia</a></p>
<p>Holocaust, one of the largest organized killing of humans, was result of a populist regime :</p>
<p>So the fear of populism is somewhat justified given what has happened in the past. However, in recent times, we have seen some populist governments functional and not just killing people all the time (with some flaws of their own no doubt) which has slowly started changing the trend.</p>
<p>There are things now majority in most countries (at least for sure in India) understands, hence they don’t want a communist style grassroot level populism:</p>
<p>A. There will be inequality, there will be elites without whom the country won’t be able to function. These elites will have more power</p>
<p>B. You need economic growth in the country to create a larger and richer middle class who can live a more comfortable life</p>
<p>C. Businesses are important and are brutally hard to run, people now support businesses that have come up using opportunity, but hate the ones that use the system.</p>
<p>D. Meritocratic selection of elite is better than nepotism.</p>
<p>And that brings us to the new form of populism we see these days (at least in Asia) :</p>
<p>Neoliberal Populism is a recent phenomenon and has been somewhat of a lesser mass murderer than Communism or National Socialism. This was basically invented in Singapore by Lee Kuan Yew, the guru of Asia’s economic rise.</p>
<p><a href="https://www.scmp.com/news/asia/article/1750577/lee-kuan-yew-eulogised-leader-not-populist-politician">Lee Kuan Yew eulogised as a ‘leader, not a populist politician’</a></p>
<p>Does that description of leader sound familiar in India ? That’s exactly how Narendra Modi is being projected too.</p>
<p>This populism combines a political capitalist system :</p>
<p><a href="https://www.cato.org/sites/cato.org/files/serials/files/cato-journal/2015/2/cj-v35n1-2.pdf">https://www.cato.org/sites/cato.org/files/serials/files/cato-journal/2015/2/cj-v35n1-2.pdf</a></p>
<p>and a meritocratic political+executive elite:</p>
<p><a href="https://lkyspp.nus.edu.sg/gia/article/resisting-authoritarian-populism-lessons-from-for-singapore">https://lkyspp.nus.edu.sg/gia/article/resisting-authoritarian-populism-lessons-from-for-singapore</a></p>
<p>This system has in last few years lifted millions out of poverty. Takes just few decades to turn countries from low income to high income:</p>
<p>If you are reading my answer from top till now, look at the Gujarat model article I had shared. Get the similarity ?</p>
<p>There are the usual drawbacks of Populism like no way for dissent which have been present in all three countries above (not just China but also South Korea and Singapore) . There are also additional risks of persecution of minorities and shifting the focus of country from the neoliberal track to a more nationalist one like in Russia.</p>
<p>In India, Modi is trying to get a neoliberal populist subsystem in place in conformation with Indian Constitution. While there is an meritocratic executive elite in India ( <a href="https://en.wikipedia.org/wiki/Union_Public_Service_Commission">Union Public Service Commission - Wikipedia</a>)</p>
<p>The political elite is not at all meritocratic as I have described earlier. It is very dynastic and that is why they do not like the concept. Many people accuse Congress of nepotism, a lot of them blame our cinema industry for the same too. Populism requires this to change and you will see constant efforts by Modi to put such changes in place.</p>
<p>For example, judges in India are appointed by recommendations. Modi’s introduction of a judge appointment commission was met with a lot of criticism and was later struck down by the Supreme Court. However, Supreme Court has introduced new methods to make the appointments more transparent.</p>
<p><a href="https://en.wikipedia.org/wiki/National_Judicial_Appointments_Commission">National Judicial Appointments Commission - Wikipedia</a></p>
<p>When an Indian Liberal is accusing Modi of changing the idea of India, they are against this type of populism. Just an example of a latest populist speech here:</p>
<p>3. Control of Morality: By this I mean who decides what is wrong and what is right. For example if there is a question “If a person comes to your house at night asking for help and looks shady, should one help them or not ?”, majority might think very differently to it than what elites think. They both live in very different localities, meet very different people and hence one might feel that the other is pushing their views on other.</p>
<p>Look at the narrative on Diwali (biggest hindu festival) coverage from different sides of the spectrum:</p>
<p>Truth is Diwali does add some pollution into atmosphere for one day, but the pollution in/around Delhi is prevalent throughout the season and peaks weeks after Diwali. Given that, is it OK to boycott traditional practice of crackers ? That is what control of morality means and that is what fight is about.</p>
<p>So I hope I have been able to somewhat explain what Indian Liberals don’t like about the populist terms of Modi government.</p>
<p>The other issue of contention between Indian Liberals and Modi-ism is</p>
<p><strong>Hindutva:</strong></p>
<p>This is a very hot button issue. Probably what the BJP and its allies are hated for the most by Indian Liberals. While Indian Liberals refer to it as “the philosophy of hate”, while for the cultural right wing, its a philosophy to make Hinduism more resistant to the flaws it had during muslim invasions and British raj as a society.</p>
<p>When Savarkar (the proponent of Hindutva) met Mr. Gandhi (a very conservative Hindu), he was trying to prove to him that Hinduism needs to change to become less prone to division, while Mr. Gandhi wanted the old practices of Hinduism to stay.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-11-30-Thoughts-On-Recent-Indian-Economics-and-Politics-2019-to-2021/media/image124.png" alt="" /></p>
<table>
<tbody>
<tr>
<td>[When Mahatma Gandhi met Veer Savarkar</td>
<td>India News - Times of India](https://timesofindia.indiatimes.com/india/when-mahatma-gandhi-met-veer-savarkar/articleshow/71326322.cms)</td>
</tr>
</tbody>
</table>
<p>One of the ways to become less prone to division is to become more cohesive and defensive. That is not something a lot of people will like as it reduces the openness to new ideas like socialism or secularism or different religions.</p>
<p>Indian liberals and Indian right is very very strongly divided over this issue. Politicians from Modi’s party who give useless inflammatory speeches against others time-to-time further give rise to the doubt that maybe political Hindutva is not a defensive philosophy but a hate philosophy.</p>
<p>So in a nutshell, if you believe in many of the following:</p>
<ol>
<li>
<blockquote>
<p>Socialism as a means to redistribute wealth</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Neoliberalism</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Minorities getting power through identity politics</p>
</blockquote>
</li>
<li>
<blockquote>
<p>A government more influenced by intellectuals and less by what the majority would think.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Don’t believe that Hinduism as a culture needs to be more cohesive/defensive or think Hinduism is obsolete and needs to go away.</p>
</blockquote>
</li>
</ol>
<p>You can say you are an “Indian Liberal”</p>
<p>An Indian Right Wing guy (also called RW on social media) is one who has a good number from the following beliefs:</p>
<ol>
<li>
<blockquote>
<p>Populist, that is believes majority sentiment should be considered important.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Doesn’t want nepotism but a meritocratic elite/intellectuals.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Believes Hinduism needs to be more united to save the local cultures/beliefs.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Neoliberal economics</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Socialism as a means to keep the nation together.</p>
</blockquote>
</li>
</ol>
<p><strong><em>Based on the above discussion, you should make a choice about what political group you belong to rather than just thinking that “being liberal is a supposedly good, so I should be a liberal” or an otherwise equivalent statement like “Being Populist seems like a good option”.</em></strong></p>
<p>Classical Liberalism or Liberalism (not Indian Liberalism) is basically the policy of Laissez Faire capitalism, freedom in all regards to people and progressiveness. This philosophy has absolutely no political base in India. A lot of people who believe government should let the religions alone and think only in terms of economy belong to this school of thought, but if you think about the ramifications of such a government, it might not be really possible to have such a government.</p>
<p><strong><em>The other part is Why are liberals criticized so much ?</em></strong></p>
<ol>
<li>
<blockquote>
<p>Anyone who takes a stance is criticized by the other side. People have different belief systems so one needs to open to criticism when one proposes subjective ideas.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>The best way for an elite to run the show is to not be distinguishable from the crowd. But many elites become “Let them have cake” level disconnected from the majority and speak/do things the majority doesn’t like. That begets criticism.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Many people are “Indian liberal” because this has social brownie points in some circles. These people to show themselves as more distinguished start an arms race which gets them to become more and more fringe.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Going with the saying “enemy of enemy is friend”, Indian Liberals have sometimes taken support from people who have taken refuge in far left or many alternative -isms. Communism wants the nation state to be obsolete and hence these people sometimes say things against the country as a whole instead of a political party. That rubs many people the wrong way. Also nothing is without consequences, you dilute your ideology when you mix it with anyone. Also the global trend of moving far left for center left politics supports this.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Indian Liberals like any other political group are hypocritical in highlighting problems when they seem fit and staying shut when needed. Hypocrisy is guaranteed to get criticism. For example, an Indian Actress who criticizes Diwali festival for fireworks had lot of fireworks in their movie release party.</p>
</blockquote>
</li>
</ol>I am hereby summarizing some thoughts on contemporary Indian politics and economics [2019-2021].Reflections On Econopolitics About Isms And Acys2020-10-30T00:00:00-05:002020-10-30T00:00:00-05:00https://muktabh.xyz/2020/10/30/Reflections-on-Econopolitics-About-isms-and-acys<h3 id="my-answer-to-doesnt-the-free-market-provided-by-capitalism-inherently-discourage-free-and-unbiased-media-because-free-market-supports-greed">My answer to “Doesn’t the free market provided by capitalism inherently discourage free and unbiased media (because free market supports greed)?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNbpi2">https://qr.ae/pNbpi2</a></p>
<p>[All my other answers linked in this first answer have been included in blog post so one can read uninterrupted]</p>
<p>Many assumptions and emotive cognition here in the question, so putting my views on those as well while answering the question :</p>
<ol>
<li>
<p>“<strong>Capitalism has a definition centered around greed” :</strong> This is subjective opinion at best (for both pro and anti “greed” people). What you call greed, other might call self preservation. Capitalism at best means what humans have evolved into after a few millenia. In fact, there is no exact definition of capitalism. pre-1900s Feudalism to 1980/90’s Free Markets to modern bigtech dominance (what some people who dislike it call surveillance capitalism) are all evolution of capitalism based on society. It is an evolving system of incentives and issues. Self Preservation and Passing onto future generation are two constant themes, nothing else. There is no “capitalism manifesto” to define and micromanage how capitalism should work. We see in nature that very greedy organisms get eaten by the surrounding ones and an extremely selfless one withers off. Selflessness which animals show is also part of self-preservation (greed) , as they want a stable society and expect reciprocity in troubles. A complex system like society needs a fine/optimal balance between greed and selflessness to exist, tilt more towards one side and the system either fails or resets or evolves. Society and Economy are way too complex to be defined/run with 5000 page manuals or blanket terms like “Y-isms” and “anti-X”. I will in this question try to explain how I think these modern political concepts have evolved (IMO of course, fully subjective answer) and why news is really just one aspect of short term fixes humans apply to run their society.</p>
</li>
<li>
<p>“<strong>Absolute Free Market can exist” :</strong> Another flawed reasoning in mind of pro free market people is that a free market can perpetually exist. While Adam Smith’s “invisible hand” is an excellent (and probably the best) policy in short term and does increase prosperity for everyone, it is bound to fail in the long term because division of labor (the concept on which free markets work) doesn’t let all sides have equal moats. So people on on side of division of labor are much more susceptible to creative disruption than others. I don’t blame Adam Smith for omitting this caveat in his theory at all because during his lifetime, creative disruption would have taken centuries and this effect would be impossible to notice. However, in modern times, seemingly free markets automatically turn into asymmetrical spaces : <a href="https://qr.ae/pNFuzc">Muktabh Mayank’s answer to How does a company that sells a powerful software package like MS Office survive when others offer a free equivalent package?</a> . <em>Basically, all I am trying to say is that Free Market does end up creating a hierarchy of more powerful and less powerful</em> : <a href="https://qr.ae/pNCyD5">Muktabh Mayank’s answer to How far can India go to keep the Chinese players, who are well en-trenched in the global tech supply chain, off the Indian market without prejudicing its own growth?</a> . There was a time when “Libertarianism” was a proper political wing demanding no opposition to free markets. But now Libertarianism has dissolved into either Neoliberalism (no opposition to monopolies) or Neolibertarianism (no opposition to government interference).</p>
</li>
<li>
<p>“<strong>State run systems are somehow less greedy” :</strong> Our friends on the left have another theoretical idea counterpart of free market which is “from each according to their ability, to each according to their need”. We can discuss the merits/demerits of the idea based on whether it is unfair to high-ability people or not, but let’s leave that aside for now and see how idea works in practice. The idea introduces an arbitrary power concept : “the authority to decide who needs what”. So in communist/socialist countries, we dont really eliminate evils of Capitalism, we just introduce a new method to run the power structure, “control of the supply side”. The Socialist/Communist party running the system builds power structures to control the supply side (“who gets what?”). Free Market on the other hand works on “Demand Side” (and powerful people manipulate demand side to get stronger). Free Market works slightly better because a demand based economy is more natural, that’s all. So people with greed will try a different method than manipulating demand in more centralized economies, which is getting more say in authority which controls supply. <a href="https://qr.ae/pNofjj">Muktabh Mayank’s answer to Is capitalism a long-term solution? Or is it temporary till technology can be used to control people’s greed and then communism can be established?</a> . Please understand that nor was Communism thought about with intention to create a power center like Feudal systems have (it in fact had the intention to decentralize power to workers), neither was free market thought about to give rise to the <a href="https://en.wikipedia.org/wiki/1%25_rule_\(Internet_culture\)">1% rule (Internet culture) - Wikipedia</a>, but intentions dont matter ! Incentives do and there is no way someone thinking about a new ideology can model all these scenarios. There is just no perfect political/economic philosophy. Everything is a tradeoff. But remember, whatever political philosophy you adopt, you cannot stay away from the two evolutionary traits of 1. Self Preservation and 2. Desire to do good for progeny. <em>In your words, you cannot get rid of “greed” even if you run away from capitalism, its much deeper than that</em>: <a href="https://qr.ae/pNuKHE">Muktabh Mayank’s answer to Does communism inherently benefit from war as capitalism (unfortunately) does? Wars have previously boosted the economy of capitalist countries.</a></p>
</li>
<li>
<p>“<strong>Unbiased press exists/can exist under some scenario”</strong> : If you have read this long theoretical and subjective answer (and maybe my other linked answers !) till here, I think I would have convinced you that you cannot really run away from power structures (hierarchies) and greed. They are just how humans aggregate as society (or in any group). At best, you can try to make them more fair. The spread of information (which you can call news between 1900s-2010) is the most important way to exercise the power human hierarchies have. So news has always been and will always be “biased”. Its either biased towards people at top of hierarchy or ones who can possibly displace them. <a href="https://qr.ae/pNwcan">Muktabh Mayank’s answer to Is artificial intelligence already controlling us in the form of tech giants manipulating people via algorithms?</a> . Humans are extremely local creatures and they can only look into their intermediate surroundings and make logical decisions. To look beyond that, they depend upon what information is conveyed to them. Most of them will just depend upon processed opinions/statistics from trusted sources, others will try to read into patterns from facts. But there is just so much information out there ! You don’t even need to spread mis-information to build a narrative, you just can pick-and-choose what facts to report out of the available ones to build a narrative. No news organization will choose facts to be reported in random, so the algorithm they use to pick and present facts is what introduces bias.</p>
</li>
</ol>
<p>There is just too many things which happen in real world. History books, epics and biographies were ones the medium to pick-and-choose and then report facts in a way that a narrative can be built for most time in history. Then came the news, after printing press became more common (and then radio waves and TVs). Also there were always hierarchies and power structures amongst humans. It’s no coincidence that facts have been selectively reported all along to preserve such hierarchies.</p>
<p>If you come up with theories like “X,Y,Z-ism caused biased press”, that is just <a href="https://en.wikipedia.org/wiki/Confirmation_bias">Confirmation bias - Wikipedia</a>. With spreading information becoming easier and easier after invention of printing press or private TV or freedom of expression, you now see more and more points of views and thus begin to realize that there is bias in the news. There is very few negative accounts for ancient power structures like say Alexander (unless they had a parallel power structure, like enemies like Egypt and rest of Mesopotamia have talked all ill about Assyrians). Its not like Alexander had no flaws and some US president or Lenin was totally innocent. Its all about who reported what facts.</p>
<p>As and when more information becomes available, society will reset/rearrange itself accordingly : <a href="https://qr.ae/pNCZvk">Muktabh Mayank’s answer to Will the 5G internet make this world a chaotic place?</a> . You can already see that democracy as a system of government has changed so much after main mode of information switched from TV to Social Media. One reason democracy became common when compared to feudalism was because news emerged as the main means to consume information.</p>
<p>I see this trend as humanity handling issue of trust and <a href="https://en.wikipedia.org/wiki/Principal–agent_problem">Principal–agent problem - Wikipedia</a></p>
<p>as they develop. t will be very interesting to see how fast data with 5G and tech like AI and blockchain will shape the the world in future.</p>
<h3 id="my-answer-to-is-artificial-intelligence-already-controlling-us-in-the-form-of-tech-giants-manipulating-people-via-algorithms">My answer to “Is artificial intelligence already controlling us in the form of tech giants manipulating people via algorithms?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNwcan">https://qr.ae/pNwcan</a></p>
<p>AI as of now (and for a foreseeable future) is not cognizant, its just a tool like computers, shovels and engines are. So AI cannot really “control” humans.</p>
<p>This is question on line of “Do guns kill people ?” or “Do crazy people kill other people ?”. The answer to that can be inferred by asking, “Was there no homicide before guns ?” or “will there be no homicide if there are no guns ?”. IMO, guns just make killers more efficient, making them better than killers who do not use guns. You might have a different opinion.</p>
<p>Similarly, tech giants are just using algorithms for the same thing elites before them have been using for a long time to control the window of discourse. Humans are hardly able to understand environment beyond their immediate surroundings and will form an opinion based on how is information conveyed to them. The trick to control window of discourse is selective flow of information. You can change society’s view on things by showing the same thing from different perspectives. Fortunately/Unfortunately, that is how human societies are structured. What tech giants can do however is instead of building general narratives which they need to hammer down into everyone’s mind, they have started personalizing flow of information to individuals using algorithms. This makes them much better at bending and shaping opinion as compared to older methods like Newspapers, TV, Books and Public Announcements.</p>
<p>Social Media/Other bigtech just gives a more efficient method for creative destruction of previous ways to control discourse. That is why you find traditional guardians of public discourse who have not been able to master bigtech blaming it for everything like misinformation to destroying society. Truth is an old guard is slowly vanishing and new one is taking its place.</p>
<h3 id="my-answer-to-isnt-specialization-in-society-designed-so-that-we-each-dont-have-to-research-test-define-and-fix-everything-ourselves-doesnt-this-eliminate-the-need-for-self-reliance-for-literally-everything-isnt-that-progress-and-a-good-thing">My answer to “Isn’t specialization in society designed so that we each don’t have to research, test, define, and fix everything ourselves? Doesn’t this eliminate the need for self reliance for literally everything? Isn’t that progress and a good thing?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNz7db">https://qr.ae/pNz7db</a></p>
<p>Given two assumptions, specialization or economic <a href="https://en.wikipedia.org/wiki/Division_of_labour">Division of labour - Wikipedia</a></p>
<p>is actually beneficial :</p>
<ol>
<li>
<p>The world is static, that is there are no technology or natural disruptions. Or alternatively, all specializations are equal against shock events.</p>
</li>
<li>
<p>Everyone plays fair. That is, division of labor is strictly according to opportunity costs and not aversion to change. In fact, Division of Labor is the practical consequence of opportunity cost. As long as everyone rationally analyzes their opportunity costs and acts accordingly, things should be fine.</p>
</li>
</ol>
<p>Adam Smith’s “invisible hand” is actually our point 2, that is, human intuition of opportunity cost and tendency of most people of to be law abiding. Given a relatively less disturbed country from wars and diseases where there is rule of law, laissez faire should do very well if they can ensure fair play. Pax-Americana {“and Pax-Britanica ?”} are examples that this works for a very long time until the fundamental structure of society starts changing. More fundamentally, specialization is its own enemy as it changes the social structure which wass the reason why specilization was successful in the first place. Let’s try and see the two school of thoughts about why specialization doesn’t scale :</p>
<p><strong>Humans are not really rational</strong></p>
<p>However, 2 is almost always violated. Greed/Self-Preservation is not the only emotion that influences human decision making, stability/aversion to change is another one. People tend to be very accepting of their new advantages, but find adapting out of old advantages away harder. So you can see gatekeeping measures like minimum wage or no foreign workers or government subsidies blocking economics to take its true place. So for example some unions would get a minimum wage in place for workers to make sure newer less experienced workers cannot compete with senior people as they cannot be hired at a lower cost. Senior people need consistent money to survive and there are two ways to ensure the money supply : upskilling or minimum wage. Minimum Wage is a more stable and less unknown option than upskilling, so you would see workers union asking for minimum wages, thus changing the opportunity cost metrics. Many from upper and middle class would rather let their old and less lucrative jobs move out of community than providing a way for lower class to take their place by imposing various measures of “quality”. Many elites would practice nepotism and destroy wealth rather than growing the pie. Similarly, you would see countries subsidize their agricultural or traditional economic sectors to make sure someone else doesn’t win the race of division of labor fairly. Most OECD countries have heavily subsidized agricultural sectors making sure the most efficient variant {less specialized jobs moving to economically less well off countries} doesn’t really occur. So essentially, while some countries/communities with privileged have all the labor and earnings because of their power and influence, the others might end up becoming unemployed as they can get no real work. Such unimodal distribution of work is not true ‘specialization’, its just powerful exploiting the weak and weak fighting for misplaced causes. Humans often just want to be confrontational for its sake and portray fights as Zero Sum games where they aren’t.</p>
<p><a href="http://documents1.worldbank.org/curated/en/888731468331207447/pdf/WPS6963.pdf">http://documents1.worldbank.org/curated/en/888731468331207447/pdf/WPS6963.pdf</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image1.png" alt="" /></p>
<p><strong>Ruin is much more powerful than success</strong></p>
<p>Another {more important} factor against 100% specialization is different divisions of labor have different risk profiles against disruption. While reading the above point, it might have seemed that lack of human rationality is the reason why specialization doesn’t work, this point says, not everyone in the same supposedly same economic strata has the same risk profile and thus some of the decisions cited above as irrational are not irrational [some certainly are!].</p>
<p>Knowledge Economies, Wealth and Basic [Agricultural/Land Owning] Economies/Communities for example are more resilient against sudden changes than say people who sell their time [daily laborers, employees, workmen] or businessmen. Self consumption based economies are more resilient than foreign cash based economies are. If a country’s most important sector is international trade, one small sea battle and their economy would be in total chaos {Many economies would be in chaos due to a war, but the one with prowess in trading will be the last to recover than say a technologically advanced or agricultural economy}. Soviet Union might have been economically worse off than Nazi Germany, but it was much more resilient.</p>
<p>“What you specialize in ?” is not exactly personal rational decision but rater circumstantial. So someone becomes a dancer, not just by analyzing all possible job profiles available, but because learning to dance is easily available to them through their circle/culture. The more effort one puts into diversification and retaining important skills, the more they will have advantage in case of shocker event. You cannot really avoid shock events.</p>
<p>If you want to read more : <a href="https://www.nature.com/articles/s41567-019-0732-0">The ergodicity problem in economics</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image2.png" alt="" /></p>
<h3 id="my-answer-to-how-does-a-company-that-sells-a-powerful-software-package-like-ms-office-survive-when-others-offer-a-free-equivalent-package">My answer to “How does a company that sells a powerful software package like MS Office survive when others offer a free equivalent package?”</h3>
<p>Originally Answered Here: <a href="https://qr.ae/pNFuzc">https://qr.ae/pNFuzc</a></p>
<p>Good Question.</p>
<p>The answer is same as why “Why do Rich tend to get richer and poor tend to get poorer ?” or “Why mostly iPhones sell in the US when there are cheaper Android phones around ?” or “Why most people use Chrome when you have a superb/equivalent browser like Mozilla despite Mozilla being more pro-user ?”. Basically <a href="https://en.wikipedia.org/wiki/1%25_rule_\(Internet_culture\)">1% rule (Internet culture) - Wikipedia</a></p>
<p>just appears out-of-nowhere whenever we humans consolidate and organize after a creative destruction. We might not like this phenomenon, but that’s how it is. The 90–9–1 rule is visible in many Consumer products’ market shares. Google-Bing-Yahoo in search Engines Chrome-Mozilla-IE in browsers, WhatsApp-Telegram and others in instant messaging and Windows-Mac-Linux is consumer OS and so on. MS Office, Libreoffice and other office products follow a similar pattern.</p>
<p>The reason mostly is Network Effect in case of MS Office. MS Office came out much before any of its free and open-source alternatives and had consolidated its hold by defeating other competitors like Lotus etc long time back. The ecosystem around MS Office thus is HUGE ! Everyone uses it, you have easily available tutorials to use Excel or World, People are taught about it in their BCA/MCA/High_school/Diploma courses, people will share docx and pptx files with you on email all the time and you have experts all around to learn from. At the level of an individual, there is just too much resistance if you want to use an alternative office product (even if it is free) and MS Office “just works” and the network effect justifies the cost. That is what Network Effect is. Once a consumer product builds an ecosystem, it is extremely hard to put out of monopoly position.</p>
<p>The only way out of a 90–9–1 monopoly is when a new technology disrupts it and you have new enterants competing on totally new ground rules. This creative disruption will slowly settle and you will have new monopolies. Right now, a <a href="https://en.wikipedia.org/wiki/Creative_destruction">Creative destruction - Wikipedia</a></p>
<p>is taking place as cloud based office suites are getting more popular. Slowly they will take over the offline office products we have now. Google Office, MS Office 360, Lark etc are the new competitors here. But you know, eventually its going to get to 90–9–1 distribution.</p>
<ol>
<li>
<p>###</p>
<h3 id="my-answer-to-is-capitalism-a-long-term-solution-or-is-it-temporary-till-technology-can-be-used-to-control-peoples-greed-and-then-communism-can-be-established">My answer to “Is capitalism a long-term solution? Or is it temporary till technology can be used to control people’s greed and then communism can be established?”</h3>
</li>
</ol>
<p>Originally answered here: <a href="https://qr.ae/pNofjj">https://qr.ae/pNofjj</a></p>
<p>That is a really misinformed question based on many many assumptions, all of which are flawed :</p>
<ol>
<li>
<p><strong>Pits Capitalism and Communism as ideological opposites, they are not:</strong> Communism is a form of government with fixed rules which basically was trying to solve problems of Industrial Revolution era Europe and has rules and laws accordingly. Many people think they work even today. Capitalism has no fixed rules and definition apart from A. allowing private property and B. inheritance from ones parents and C. Supply-Demand Trade, that is A. self-preservation and B. betterment of progeny, things that evolution has taught all life forms (including humanity) to do. C is something only humans do. So everything wrong with humanity can be attributed to capitalism. Wars, slaughters, rapes, killings, children dying, whatever bad thing you want, attribute to capitalism, because all systems are capitalist in the world. Even Soviet Russia was capitalist, the capital was not dollars, but network within “the party”. You had ways to do both A. self-preservation and B. inheritance in all communist countries through reputation. C. Trade is what “by the book” communism is terrible with and is the reason why no communist country exists now apart from DPRK. People need to stop having the impression that there is a book of evil called “Capitalist Manifesto”, capitalism can mean everything under humanity and nothing.</p>
</li>
<li>
<p><strong>Assumes “Capitalism” benefits from war :</strong> Again, who is capitalism ? where is its bank account ? War, Pandemics, Economic Crashes are events which transform the world. They press a Reset button. Due you think during war businesses like Hotels and Spas and luxury wines make profit ? There are industries that go bankrupt when any such transformative event happens. Are they not capitalism ? Any transformative event needs people power to mobilize and handle. The people of the entire country as a whole sells part of its future prosperity (or sacrifice humans who would have earned prosperity) to deal with situation. Now while everyone sells some part of their future prosperity, some people gain more than the others. It’s a combination of luck and leverage. Some rich businessmen go poor, less rich ones get richer. We look at the people getting richer and think “all” capitalists make money off misery. Very common problem with humans, stereotyping. No one looks or makes a note of those who became poorer or got bankerupt. Not saying that there are no evil businessmen, but blanket thoughts painting “All X is B” cannot be foundations of knowledge. The worst is common and poor people, who will always fare worse after any such Transformative Event. In a way communist (and fascist) ideology gain from war is when people start looking for easy explanations for their misery instead of the big picture and begin adopting thoughts like “All capitalists are pigs” or “All Untermensch are drag”. That is the only way such extreme ideologies will sell. Most communist countries were colonialism/war torn (Soviet Russia was formed post World War 1, PRC and North Korea post world war 2). Nazi Germany was born post world war 1.</p>
</li>
<li>
<p><strong>War can boost economy of any country involved :</strong> Wars ceased to be profitable for any involved parties from long time back. War requires lots and lots of investment, forcing countries to accumulate or borrow, both basically sucking out future wealth. There was time when winners could ransack and loot. That was a way to totally rob out the loser to make sure the resources wasted to win the war were recovered. This in past, made war a profitable affair for winners. But now with us conscious about human rights etc., all this is not possible and war ends with basically two parties : A. Less Damaged (Winner), B. Damaged Beyond Repair: Poor. Frankly, in modern world, taking an emotional decision like going to war guarantees some percent of ruin. Almost all winners in latest wars have been negatively effected. Britain ceased to be a world power after World War 2 ended despite winning it, Many people believe US would have been better if they did not get into the Iraq war (Iraq War is possibly the best example of victory we know by any country ever, it took weeks for US to capture Iraq) and Soviet Union dismantled after war in Afghanistan. A few people are leveraged and lucky and make profit during wars, but that is never entire countries (or system of capitalism). People who lose out in wealth due to war are never accounted for unlike those who lose out on life.</p>
</li>
</ol>
<p>With these three assumptions wrong, I don’t think the question has any standing.</p>
<h3 id="my-answer-to-is-capitalism-a-long-term-solution-or-is-it-temporary-till-technology-can-be-used-to-control-peoples-greed-and-then-communism-can-be-established-1">My answer to “Is capitalism a long-term solution? Or is it temporary till technology can be used to control people’s greed and then communism can be established?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNofjj">https://qr.ae/pNofjj</a></p>
<p>There seems to be a lot of emotive cognition in the question (I don’t know whether intended or unintended). The following assumptions make no sense :</p>
<ol>
<li>
<p>Greed needs to be eliminated for a perfect society.</p>
</li>
<li>
<p>“Communism” is some kind of ideal goal.</p>
</li>
<li>
<p>“Technology” is at some superhuman level in current time or near future and humans are flawed secondary characters . (and technology can be used to make people fall in line by some methods).</p>
</li>
</ol>
<p><strong>Argument against 1:</strong></p>
<p>First of all, there is no standard form of Capitalism unlike Communism which has a written manifesto. No one really knows what exactly should be done ideally in capitalism, except that it is the default system of private property humans have evolved into and keep evolving as civilization grows. Due to that reason, its very easy to pick on Capitalism as one can pick whatever and associate it with evils of Capitalism. Cronyism and Gatekeeping : Capitalism, Climate Change : Capitalism, Wars : Capitalism, systemic discrimination : Capitalism and so on. There is no doubt that system has flaws and it is a useless debate to defend or criticize capitalism. However, since its not exactly fixed in writing and treated like gospel, we know what needs to be improved and can work towards it. Why destroy something when you can improve it ?</p>
<p>This is by the way true about say Human Body (and any other complicated thing that has evolved over a lot of time) as well, you get to know more and more everyday, but its too hard to understand everything. Once you figure out something is not ideal in human body (say someone has a fungal itch), do you treat the fungal itch or do you just replace the skin with some new thing like say “skin of an animal resistant to fungus”. All artificial organs are mechanical copies of human organs not because human organs might be the most effective machines (sometimes they are), but because you don’t know what effect a totally new type of organ might have on the rest of body.</p>
<p>Evolution has taught all organisms “<a href="https://en.wikipedia.org/wiki/Self-preservation">Self-preservation - Wikipedia</a></p>
<p>”. Greed is an extension of it. While too much greed which harms other individuals is bad, getting rid of greed totally is even worse. Greed is the incentive that makes humans take risks, taking risks is what changes the world. If the inventor of polio vaccine would have taken a safe career choice to farm in their own field, millions of kids would have been in pain, if Elon Musk had no greed about of wealth and fame, electric cars would not be in trend today. Controlled Greed drives progress. Even scientists/engineers in Soviet Union would work much better than civil servants, because they were paid in kind by recognition and better amenities.</p>
<p><strong>Argument against 2 :</strong></p>
<p>Communism on the other hand is “non-scientific”. Here the critique can be done better because there is a proper definition. It tries to explain something as complex as human society on basis of one factor : “Class Conflict”. Not saying that class conflict is not one of the aspects of society, but to say that is the only lens human society can be looked at is kind of dumb. Communism has repeatedly failed when implemented in its ideal form and the reason is that it denies fundamentals like evolution and tries resetting a complex system like human society with a rulebook of 500 pages. To think that Marx and Engels could have beat millions of years of evolution from their experience of a few decades and figured out a way to reset human society with no flaws is a moot point. Pragmatists like Stalin could still pull off some modified variant of communism, but that was not until they started mixing communism with the elements of capitalism that everyone hates : “gatekeeping”, “hierarchy” and most importantly “exploitation”. Communism at scale has the same problems as capitalism and more ! (Read about Soviet Union during late 80s).</p>
<p>At very basic level, communism basically asks humans to start treating everyone as equals. There is no way one can treat one’s girlfriend in the same way one treats their potential competitor. I would argue that most nuclear families as a socio-economic system run communism, at least a few I know do. Favoritism is looked down on, there is shared space/goods and the money a parent (or both parents) earn is everyone’s money. Extending this has been shown to be possible for a group of humans say 50–100 who treat everyone like a family, but then it just breaks. You simply cannot have a family of 7 Billion, that is too many to emotionally empathize with in human psyche.</p>
<p>And why is communism more popular than existing boring capitalism ? Because radical (and more vocal) people often fall for “<em>Easy Answers”,</em> so will fall for things like “Lockdowns during pandemic take away freedom”, “Facebook has disintegrated society”, “Jews are evil”, “There should be no billionaires” or “Earth is flat”. No one wants to get into the nitty-gritties as A. Its not simple to understand, B. Its even harder to build a political narrative out of it. The non-radical people understand to stay away from these.</p>
<p><strong>Argument against 3:</strong></p>
<p>This is probably the biggest misconception people always seem to have. They seem to think they are in some special “technically/socially advanced” part of history. Humans have always been in acceleration mode since they became upright monkeys. The time gap between innovations/adoptions keeps going down due to better communication and infrastructure, and thus the speed of progress is super-exponential. Humans have always been on this journey to progress and still continue to be. You can think of human progress as a faster variant of evolution, what evolution would have achieved in a few Billion years, humans achieved in 1 few 100,000 years using intellect. That said, we are in no way in a special part of history where we have addressed all the concerns of society or will be able to address all concerns in a visible frame of time using technology. The reason is A. Society is hard to fix B. Society is evolving and demands increase, 100 years back it was food for all, 100 years later it will be say free asteroid for everyone. People used to believe so in early 20th century as well, maybe in early 19th century too, just like they do today. This flawed reasoning makes people think that there are messiahs who have/will make everything good with this magic called technology. While there is no doubt leadership is important, it is society which is evolving and self-correcting. Top Down reform has never been possible.</p>
<p>I dont blame common people for this opinion, “thought leaders” like Yuval Noah Harari have been pushing this narrative that humans have somehow reached this next level where we can now have just top-down progress push. Most people follow them.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image3.jpeg" alt="" /></p>
<p>In the book Homo Deus written a few years back, he says humans are now evolved enough that no pandemic can spread and here we are in the middle of one. There can be pandemics in future too just like there have been in the past.</p>
<p>Humans are on a journey of progress just like they have always been.</p>
<h3 id="my-answer-to-will-the-5g-internet-make-this-world-a-chaotic-place">My answer to “Will the 5G internet make this world a chaotic place?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNCZvk">https://qr.ae/pNCZvk</a></p>
<p>I assume the question is asked on the premise that with such humongous data speed available to each person, will society get out of control as hierarchy/order will be hard to maintain ? I dont foresee any other way 5G can harm, as its not going to be rolled out without tests.</p>
<p>The correct theoretical answer to this is : We dont know. But probability of chaos prevailing due to 5G is quite very less given that humanity is quite tenacious. Why so ?</p>
<p>You can think of human world as a very large self-organizing system. Any system which is isolated tends to have high entropy over time. I am not talking about the more popular thermodynamic entropy (<a href="https://en.wikipedia.org/wiki/Entropy_\(classical_thermodynamics\)">Entropy (classical thermodynamics) - Wikipedia</a></p>
<p>) here but the probabilistic concept of entropy <a href="https://en.wikipedia.org/wiki/Entropy_\(information_theory\)">Entropy (information theory) - Wikipedia</a></p>
<p>which simply means that the more new variables you introduce into the system, the shock or surprise value of the system increases. Just by existing, humanity is creating new issues which can surprise and damage it. We are also adding more variables with the resources of Earth we consume or the human population increase. Also with every new technology we add into the system (AI / blockchain / 5G / Genetic Engineering), while you add a few ways for the system to grow, you add many more possible ways for the system to fail. A self-organizing system will either adapt or evolve around a new surprise to incorporate it. However, if the change is something that overwhelms its capacity to adapt or evolve, it will get destroyed. Such irreversible changes are called systemic risks.</p>
<p>However, a technology like 5G is not a systemic risk, that is 5G can be rolled out gradually and problems it causes can be addressed along the way. Humanity is a self-organizing system, so it will roll out a new technology incrementally and use active stability (tactical measures) to avoid pitfalls and not crash and burn when the technology is being introduced. In simpler terms, humans are adaptable and will slowly adapt to incremental technologies and circumstances. You can say the same for new technologies like genetics or AI. The only problems are systemic risks (like pandemics, say COVID19, or say asteroid hitting the Earth), which cannot be paused and will overwhelm the speed at which humans adapt. These can damage or destabilize system as a whole.</p>
<p>Another path technology luddites suggest is to not take any risks at all, that is make surprise factor as zero from technology, invent no technology. That would essentially make the system implode as you are adding new issues and people all the time and society (and nature) can only bear as many people in its natural state. You need technology to adapt the society for good.</p>
<p>Other people who propose restrictions on new technology actually believe in passive stability (plan everything beforehand and create regulations/controls to avoid failures). They are mostly wrong as they cannot imagine all possible scenarios and end up creating regulatory capture.</p>
<p>Paraphrasing Jordan B Peterson from his book, “the path to progress lies in between stability and chaos”. Too much stability (not inventing new technology, too much restriction on thoughts and movements) will create chaos as system crashes under its own weight. 5G is a risk, but not a systemic risk.</p>
<p>5G internet is an incremental change. There is no doubt about the fact it will introduce changes into the system, but you will always have the option to turn it off. With new information available, humans will realign and the humanity as a system can adapt or evolve, but its rare that humans will not be able to take it.</p>
<p>More practically, what changes did the transition from 3G to 4G bring ? You can kind of extend the arrow and predict what changes will 5G technology bring. More apps and more centralized data over the internet. A lot many things we cannot even imagine right now. That said, I personally find it hard to believe that faster internet can damage humanity. In many places, the data speed change between 3G and 4G is not even that high to notice and maybe even after 5G is rolled out, many people will get data speed of 4G levels only for a long time. So it might actually even turn out to be marketing gimmick in some circumstances.</p>
<h3 id="my-answer-to-despite-having-so-many-good-engineers-iitians-etc-why-does-india-not-have-its-own-microsoft-google-etc">My answer to “Despite having so many good engineers, IITians, etc., why does India not have its own Microsoft, Google, etc.?”</h3>
<p>Originally answered here :</p>
<p>I have answered this question here somewhat : <a href="https://qr.ae/pN4NYf">Muktabh Mayank’s answer to Can Indian startups break Google and Facebook’s dominance?</a></p>
<p>However, Let me reiterate my points : <a href="https://qr.ae/pN5TRQ">https://qr.ae/pN5TRQ</a></p>
<ol>
<li>
<p>The competition is very asymmetric and creates a vicious cycle. Large companies have lots of money and resources and thus an Indian company which raises less money in early phases will find it really hard to compete. Indian startups find it really hard to attract and retain talent in early phases unless they don’t raise huge amount of money. Thus their product is “jugaad” or not as refined as product from a Trillion Dollar company. So, raising money to compete is hard and hence making product better is hard. Good product takes lots and lots of investments and if you are competing with a biggie with lot of resources with negligible money and talent, all you can do is build a cheaper version which caters to long tail of audience. India has many startups like this. Infact the Chennai SaaS mafia are all good tech startups and compete with likes of Salesforce and Microsoft and Googles, but they started with a focus to build a cheaper alternative, where the “jugaad” things works very well. If some day Indian market starts preferring (slightly low quality) local alternatives to high quality brands, India will have its own Googles. Russia and China have their own big tech ecosystems because they did not allow these firms to get into their market, no other country in the world has any competitors to these. There is no way a Trillion Dollar behemoth can be defeated by a set of kids working from a apartment in terms of product quality. Most IITians would prefer a job in a tech multinational than fighting this impossible battle. <a href="_blank">Big Tech – Wikipedia</a></p>
</li>
<li>
<p>Another way startups gain edge is by creative destruction, that is using a revolutionary new technology where the Trillion dollars a behemoth has has no advantage. That used to be true till a few decades back, Microsoft disrupted previous OS companies, Google disrupted older search engines and FB disrupted previous social networks. The previous companies were stuck in their cocoon and could not recognize upcoming trends gathering more and more entropy. However, the new behemoths (FAANGs as people call them + MS, which is now an internet company too) have recognized this and sold Wall Street the idea of innovation and <a href="https://en.wikipedia.org/wiki/Growth_investing">Growth investing – Wikipedia</a> and they compete just like fast moving startups, not like slow moving heavyweights, basically seldom letting startups disrupt them. How many fundamental technology giants even the US has seen after emergence of FAANGs ?The reason is that these companies dont act like traditional too big to fail companies but large startups.</p>
</li>
<li>
<p>The only way India got its large startups was (upto now) was early bird approach, that is quickly building a large enough company before the international rival grew huge in India. Ola, Flipkart , PayTM and the like. Google, Facebook etc were well established before startup culture in India started.</p>
<ol>
<li>
<p>###</p>
<h3 id="my-answer-to-should-indian-netizens-come-together-to-create-a-decentralised-democratic-and-technocratic-political-party">My answer to “Should Indian netizens come together to create a decentralised, democratic, and technocratic political party?”</h3>
</li>
</ol>
</li>
</ol>
<p>Originally Answered Here: <a href="https://qr.ae/pNF9wX">https://qr.ae/pNF9wX</a></p>
<p>So this answer will have some facts and some opinions. You are welcome to disagree.</p>
<p>First of all, I am all in for a decentralized political party which discusses things from different viewpoints before they take stance on policy. The rest of the answer is however about democratic-technocratic party.</p>
<p>From the limited history I know, I dont think its possible to have a decentralized, democratic and technocratic political party which wins election and then goes on to actually go and achieve something.</p>
<ul>
<li>
<p>Technocracy failed as a democratic political movement when it was originally conceived during great depression times in the USA. Did not hold any ground.</p>
</li>
<li>
<p>Bureaucracy (which is the technocratic wing of any democracy) is almost always really unpopular as slow and corrupt. In India, think of all the “lunch ke baad aana” ya “chay naashta mil jaata” type things you have heard. Technocrats are almost never popular due to their tendency to appear “above the masses”. The technocratic party basically says has an agenda : “technocrats know better”, think of going to people and asking votes on burning issues saying “You guys are idiots, I am an expert and here is what we should do and so vote for me”. That might work sometimes, but mostly people feel safest when they feel someone like them is running the country, not someone whose entire goal is to “appear smart”.</p>
</li>
<li>
<p>Technocracies work well only when there is a single party rule, dictatorship or oligarchy. Private companies are essentially oligarchies where CEOs achieve things that you cannot even dream of achieving in a government. China has a technocratic form of government and their officials have moved mountains (Despite that we regularly hear of purges of corrupt officials). Stalin might have had his flaws but imagine the way his technocrats could transition Soviet Union, the old man of Europe to an war machine which produced cheap weapons like nothing else. Why so you ask ? According to me, here is what happens : A. Career technocrats (who climb up career ladder) are mostly risk averse, all they have to do is show their credentials and not get into a controversy. This creates a vicious cycle where the ones who even want to do something have to face massive resistance. B. Expert Technocrats, like an “expert” nominated as ABC (ex- XYZ at PQR), have too much optionality, that is if they have credentials and they take any actions, no questions are asked about if they screw up as they were doing it according to “science”. In a private company or a totalitarian government, technocrats are forced to take risk and have no optionality. Think of going and telling Stalin as his Chief Engineer that getting a tank factory up in 1 month is not possible. Putin basically injected the scientists who invented COVID vaccine with the vaccine first. In China, promotions of technocrats are driven by numbers delivered, not years of experience. <a href="https://www.jstor.org/stable/2644688">https://www.jstor.org/stable/2644688</a>. That is uncomfortable, but unfortunately when technocracies work well is when they dont really have a choice other than working well. In democracy, elected legislature/executive is in charge of pushing technocrats out of their comfort zone and making them work, but seldom get the effect of a dictator on helm or a company board who can basically finish the CEO’s career and make him/her redundant for life if (s)he screws up.</p>
</li>
</ul>
<!-- end list -->
<ul>
<li>So if you want technical people to work, set them up for a job with huge rewards if they succeed and huge failure if they fail. This is the only way it would work. That is not how a liberal democracy works. You have to take people’s opinion into account, have baggage of the constitution, have to maintain public image, co-ordinate different branches and do so many other things. A technocracy and a liberal democracy cannot be fully aligned. Look at how Singapore, in my view the best technocracy runs : <a href="https://palladiummag.com/2020/08/13/the-true-story-of-lee-kuan-yews-singapore/">The True Story of Lee Kuan Yew’s Singapore</a>.</li>
</ul>
<!-- end list -->
<ul>
<li>
<p>How do we know which technocrat should lead ? Is good work at one’s current position an indicator that they will work better when given a better office ? That is not true as well. People really good at the current job are often bad when promoted. <a href="https://www.gsb.stanford.edu/faculty-research/publications/peter-principle-theory-decline">The Peter Principle: A Theory of Decline</a> . So its very rare that Chief Scientist or Chief Economist or Chief Secretary will make a good President. Leadership is a different skill as compared to technical skill IMO. Democracies need leaders on top with technocrats helping them advance the nation ahead. A technical person can be a leader at the top too, but they should not reach there because they were good in their technical knowledge, but because they are a good leader.</p>
<ol>
<li>
<h3 id="my-answer-to-how-come-all-the-it-revolution-happened-in-the-us-and-not-in-other-parts-of-the-world">My answer to “How come all the IT revolution happened in the US and not in other parts of the world?”</h3>
</li>
</ol>
</li>
</ul>
<p>Originally Answered Here: <a href="https://qr.ae/pNoq9n">https://qr.ae/pNoq9n</a></p>
<p>IT “Revolution” did not happen just in US. IT has changed the whole world for good. One of the major factors in India’s post-socialist economic growth is due to IT revolution and automation. Africa despite of poor infrastructure has economies growing faster than 10% per annum because of Information Technology. Another thing is “Revolution” is quite a strong word. It has a specific meaning which often incorporates violence. Revolutions are often stupid and lead nowhere. I find the term <a href="https://en.wikipedia.org/wiki/Creative_destruction">Creative destruction - Wikipedia</a></p>
<p>better, that is what brings about most change.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image4.png" alt="" /></p>
<p>Maybe a better question can be “Why did IT revolution start in the US and why did IT create the most billionaires in US ?” . That would be a much better question. The answer is not as simple as you think.</p>
<p>Think of the creative destruction phonomena humanity has seen before which required lot of efforts:</p>
<ul>
<li>
<p>The first large buildings from Egypt</p>
</li>
<li>
<p>Codified Law and Trade from Mesopotamia</p>
</li>
<li>
<p>Civil Engineering from Indus Valley</p>
</li>
<li>
<p>Mathematics from India</p>
</li>
<li>
<p>Macedonian phalanx</p>
</li>
<li>
<p>Greek Philosophy</p>
</li>
<li>
<p>Principles of Empire Building from Rome</p>
</li>
<li>
<p>Gunpowder and Silk from China</p>
</li>
<li>
<p>Renaissance from Italy</p>
</li>
<li>
<p>Spanish/Portuguese shipping</p>
</li>
<li>
<p>Industrial Revolution from Britain</p>
</li>
<li>
<p>Electronics breakthroughs from the US</p>
</li>
<li>
<p>IT breakthroughs like telephony, satellites and internet from the US</p>
</li>
</ul>
<p>Most of these phenomena did not stay restricted to the country they originate in, in fact, many of them benefited other countries more than the country of origin. They reason is discovering something is different from exploiting the new discovery. For example, Industrial Revolution originating from Great Britain actually made US industry base strong enough to emerge as the deciding factor in World Wars and hence as the new world power. Similarly, while Chinese invented the gunpowder, Central Asians (Turks) made empires out of it in Anatolia, India and Iran.</p>
<p>But there is one thing common amongst the countries inventing these technologies :</p>
<p>They were all rich and superpowers of their time. Rich countries have rich people who have money and resources to invest in a new technology development, so that they can benefit from being the early bird. Money drives inventions and luck drives who profits most from these investments.</p>
<p>TL,DR: IT revolution happened in the US because in the timeframe of 1950–now, US is the richest country with rich people who can invest into things that can give them profits. Being Rich also has basic requirements of stable government, rule of law etc. Greed is not always bad. Adam Smith stuff !</p>
<h3 id="my-answer-to-how-did-china-become-the-worlds-second-largest-economy-with-the-help-of-reverse-engineering">My answer to “How did China become the world’s second largest economy with the help of reverse engineering?”</h3>
<p>Originally Answered Here: <a href="https://qr.ae/pNMVYl">https://qr.ae/pNMVYl</a></p>
<p>Good Question. One line answer is that you cannot be good at everything at the beginning, you start with one advantage you have and then use it to place your eggs in other baskets. China used its one well defined strength and advantage and is now finally in a state where it can look into developing new moats.</p>
<p>China’s advantage was its cheap/humongous labor force and united population ( achieved by the not so famous <a href="https://en.wikipedia.org/wiki/Cultural_Revolution">Cultural Revolution - Wikipedia</a></p>
<p>) willing to rally behind their country/leadership in any decisions they make. <a href="https://en.wikipedia.org/wiki/Deng_Xiaoping">Deng Xiaoping - Wikipedia</a></p>
<p>’s government skillfully engineered this “people’s republic” advantage into Market-Capitalist principles, creating the “factory of the world” we see today. China had population advantage and they used it well. There are other advantages/moats like capital/research/technology that you suddenly cannot create. People need to get better off, stock money, be able to go to universities (within and outside country) and be willing to invest and work in their own country for a country to develop these specialized advantages.</p>
<p>Using its first advantage, that is large and willing to work for country population, China developed a LARGE middle class, creating incentives for businesses that created rich people and capital and scholars in their own universities or scholars that went to top US universities and decided to come back and work. Now that technology/capital is plenty, China is evolving from what you are calling a “reverse engineering” economy to a first world innovation based economy. China is right now somewhat like how US was at end of World War 2. It has capital that it can invest in other places and take advantage of their growth (Africa/Central/South Asia/South East Asia) and build capabilities/afvantages which are more resistant to creative destruction like technology,science,space. <a href="https://www.europeanchamber.com.cn/en/upcoming-events/11057/_Made_in_China_2025_China_s_answer_to_Industry_4.0">“Made in China 2025”: China’s answer to Industry 4.0</a></p>
<p><a href="https://en.wikipedia.org/wiki/Belt_and_Road_Initiative">Belt and Road Initiative - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image5.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/Made_in_China_2025">Made in China 2025 - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image6.png" alt="" /></p>
<p>BTW, this is not a unique strategy, all world powers have arisen through this principle :</p>
<ol>
<li>
<p>Develop one or a few unique advantages and come ahead of the world,</p>
</li>
<li>
<p>Conquer/Dominate the world and learn of other cool technologies/advantages people groups have,</p>
</li>
<li>
<p>Copy/Better the advantages of other people becoming prominent.</p>
</li>
</ol>
<p>Mongols won a huge empire using their unique warfare methods, but slowly adopted traditional Chinese moats like Silk / Tea trade, Chinese engineering and irrigation technology.</p>
<p><a href="https://en.wikipedia.org/wiki/Kublai_Khan">Kublai Khan - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image7.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image8.png" alt="" /></p>
<p>British developed Navy and came to dominate trade becoming resourceful, then they conquered India / dominated China and forcefully took their advantages under their own control (started making clothes in UK, started growing tea and silk in India and stated growing spices in caribbean ).</p>
<p><a href="https://en.wikipedia.org/wiki/Textile_manufacture_during_the_British_Industrial_Revolution">Textile manufacture during the British Industrial Revolution - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image9.png" alt="" /></p>
<p>That was the 18th century equivalent of China stealing IP (or what you call Chinese Reverse Engineering methods). <a href="_blank">Intellectual property in China - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image10.png" alt="" /></p>
<p>US did the same with Europe and UK, basically using investment and technology to develop a large industrial/financial base and then coming to capture trade/commerce/softpower/top technology after UK became a secondary power post world wars. As an Indian born near economic opening up of the country, I hardly find any connection to erstwhile empire my ancestors lived in, but many to US contemporary culture.</p>
<p><a href="https://en.wikipedia.org/wiki/Allied_technological_cooperation_during_World_War_II">Allied technological cooperation during World War II - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image11.png" alt="" /></p>
<p>China did the same thing. Using the investment from US elites looking to “globalize” and their willing workforce as low cost labor, they got their initial advantage and are now taking up the advantages US and other countries have in terms of technology.</p>
<h3 id="my-answer-to-can-inheritance-be-called-nepotism">My answer to “Can inheritance be called nepotism?”</h3>
<p>Originally Answered Here: <a href="https://qr.ae/pNolgo">https://qr.ae/pNolgo</a></p>
<p>No. There is a clear distinction between inheritance and nepotism from how I see it.</p>
<p>Inheritance is the transfer of wealth one has earned lawfully in their life to their progeny or kin. The wealth has been earned and is owned by the person who is passing it down. When one owns money or property legally (that is they have not stolen it and have paid taxes), I think its upto them what they do with it, whether spend it or save it and pass it on.</p>
<p>Nepotism on the other hand, is using one’s power and social status to do gatekeeping. That means using one’s power to create resistance for outsiders to reach the same or similar positions of power. For example, (what is in news in India these days), rich Bollywood personalities may deliberately use their connections to get their kids act in more and more movies while reducing chances for others. Another example is a politician’s kid getting preference over a similar (or even more) qualified people in politics, just because of connections of their parents. The reason is that the minimum requirement for most jobs, except the ones at apex/absolute top are average joes, so you wont feel the effect of a less effective person in the job, unless you contrast it with a very effective person sitting on the job. For example, someone sitting at a clerk’s position because they have contacts won’t be necessarily bad and you will notice the difference only when you see a very smart clerk work. Nepotism uses this fact to sneak in less qualified people due to the contacts. Its not always sneaked in btw, sometimes people are very open and blatant about nepotism.</p>
<p>All people want is if they are able to overcome their social obstacles to become as good as people from better families than them, they are pushed behind just because they come from less influential facility.</p>
<p>Nepotism according to me is unfair (and thus wrong) because:</p>
<ol>
<li>
<p>While wealth is lawfully earned and possessed and the person has the right to do whatever with it (burn/donate/spend/save it for the kids). Inheritance is the exercise of this right. Its not necessary they use the wealth optimally for society or even themselves.</p>
</li>
<li>
<p>Status, influence and power is earned but is not possessed. In a meritocractic society, status is given to a person for their capability and is not possessed like in a monarchy. Influence is shared property of the person with influence and the society which gives them influence. They are not justified in using the influence in a way that is sub-optimal and bad for the society. People doing nepotism are basically cheating the society.</p>
</li>
</ol>
<p>Nepotism nullifies the most important basis of meritocratic society that is “equality of opportunity”. In monarchies and other hereditary form of government, nepotism is built in and hence they enjoy low to no citizen-satisfaction and loyalty. Many people would not even mind if a monarchy who doesn’t hear their voices be replaced. Try toppling a meritocratic society and see the retaliation !</p>
<p>Going against inheritance is basically going for “equality of outcome”. Equality of Outcome has fundamentally flawed assumptions that dont survive evolution human society :</p>
<ol>
<li>
<p>People dont love their kids more than they love the kids of others. Life would have not evolved if this wasn’t true.</p>
</li>
<li>
<p>Equality of outcome finishes the incentives of risk taking people. Most human progress is because someone dared to light the first fire, tame the first wolf (all dogs are basically wolves), sit on the first immature assembled airplanes and touched radioactive elements without adequate protection (Marie Curie actually due chronic radiation poisoning) .</p>
</li>
<li>
<p>Humans are better at different things and we cannot expect them to be equally good at everything. Someone cannot be either a good engineer or good doctor or good politician, maybe one of these or two at best.</p>
<ol>
<li>
<h3 id="my-answer-to-the-question-is-nepotism-in-democracy-a-boon-or-a-bane">My answer to the question: “Is nepotism in democracy a boon or a bane?”</h3>
</li>
</ol>
</li>
</ol>
<p>Originally answered here: <a href="https://qr.ae/pNuBxW">https://qr.ae/pNuBxW</a></p>
<p>This should not even be a question.</p>
<p><strong><em>Nepotism is of course bad for democracy.</em></strong></p>
<p>What everyone needs to understand is Inheritance is not Nepotism. People do not speak out openly against nepotism because they confuse the two : <a href="https://www.quora.com/Can-inheritance-be-called-nepotism">Can inheritance be called nepotism?</a> Nepotism is using trust given by the public in a way to benefit one’s near and dear ones and thus harming the society as a whole. Inheritance is passing down wealth one rightfully earned to ones’ progeny. There is a reason in any decent government, office can be taken away for malpractices, but not one’s honestly earned wealth. Public trust and ability combined makes an influencer, not just their personal attributes, hence they cannot use their influence like personal property for decisions suboptimal to society.</p>
<p><strong>Why is Nepotism bad ?</strong></p>
<p>The biggest problem with measuring the effects of nepotism is that its hard to :</p>
<ol>
<li>
<p><strong>Identify when Nepotism is taking place :</strong> While the very famous cases cannot be hidden, many other cases are hidden well. Many public figures who appear to be rich and famous all due to themselves, often have used their parent’s connections. This makes it really hard for common people to associate talent with meritocracy. “All ABC officeholders are same” type of mentality benefits nepotists.</p>
</li>
<li>
<p><strong>Recognize mediocre public managers in short term :</strong> People incoming from nepotism are often mediocre (otherwise they would not need nepotism), but they tend to be well informed (because that is what is going to save them from humiliation). They will hide behind rules, be good at public dealings and people pleasing. The aim of mediocre people is “to not get fired” and not “to do their job well”. Hence its harder to single mediocre people. So to normal people, they would look more acceptable. Looking acceptable is good way to run away from performance/responsibility.</p>
</li>
<li>
<p><strong>There is no control experiment for performance of a nepotism user (No one to compare):</strong> Its very hard to know if someone has used nepotism to get ahead in life, its even harder to know what would happen if someone with merit would run the show instead of someone taking advantage of their name. Coming from an influential family gives people more risk appetite allowing them to compound more skills. The only way to understand if an actor from middle/lower class of society will be as famous (or actually more famous) as one from an influential background is to give them the same risk appetite (say get as many movies where they continue to not act well before acting clicks to them). That is not really possible. People can identify thus only blatant cases of nepotism, when the person being pushed ahead is so bad they cannot even hide their incompetence.</p>
</li>
</ol>
<p>This study of nepotism in politics <a href="https://www.tandfonline.com/doi/full/10.1080/2474736X.2020.1781542">https://www.tandfonline.com/doi/full/10.1080/2474736X.2020.1781542</a></p>
<p>finds an interesting relationship. The percentage of people in administration who are relatives goes up with more number of municipalities jobs.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image12.png" alt="" /></p>
<p>While the number of people who are relatives increasing with number of government jobs is obvious as “more people being hired means more people related to each other can be hired”, but the percentage of related people going up with larger number of job basically means, for larger municipalities, relatives are more likely to get hired !</p>
<p>The authors characterize nepotism as “Rent Seeking” by influencers, who when they cannot convert whole of their influence into money (because as I said, influence is a shared trust between influencer and influenced and not a cheque to be cashed), use their influence to get their relatives to become influencers too.</p>
<p>There is also a hint that the government is made bigger (and more inefficient) by overhiring to accommodate nepotism. In my experience, people using nepotism often want to protect their image by hiding behind degrees and expert opinions to save themselves from responsibility of their action. I think one way to use your influence and get relatives hired is to use money to get a degree and get them a job as an expert/consultant and the other way is to hire a lot of intellectuals who can create an environment to defend your policies and nepotism. You need overhiring in both cases. But that makes system inefficient for common man.</p>
<p>There is no doubt that nepotism over meritocracy would get more mediocre people hired. (not all people using nepotism can be meritorious!). Managers with perceived traits of mediocrity have been shown to have bad collaboration and yield. (This study is a bit too subjective to determine mediocre managers so take it with a grain of salt) : <a href="https://www.researchgate.net/publication/242221207_What_Is_Managerial_Mediocrity_Definition_Prevalence_and_Negative_Impact_Part_1">https://www.researchgate.net/publication/242221207_What_Is_Managerial_Mediocrity_Definition_Prevalence_and_Negative_Impact_Part_1</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image13.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image14.png" alt="" /></p>
<p>So, according to this study, mediocrity reduces productivity and cohesion in the long run. This is because mediocre people are bad at taking responsibility and initiative. These are also very common in nepotism culture by using safety as an excuse to avoid action and building an environment of “the whole system is slow and corrupt” to hide one’s inaction.</p>
<h3 id="my-answer-to-doesnt-communism-inherently-provide-no-motivation-for-working-very-very-hard">My answer to “Doesn’t Communism inherently provide no motivation for working very very hard?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNzS45">https://qr.ae/pNzS45</a></p>
<p><strong>Short Answer</strong>: “Yes”. Non-motivation to work hard is what caused the Soviet Union to fail.</p>
<p><strong>Long Answer</strong>:<br />
What is the motivation to work “very very hard”?<br />
There are two reasons in my opinion:<br />
A. Emotional Connect (what we call passion) and<br />
B. Desire to get lucky (and thus get exponential returns on one’s efforts).<br />
If one of these two things don’t exist (or sometimes even both together), all a person will do is what you call 9 to 5 job. Now, there are of course people who are passionate about their work and will continue to work hard even if there is no gratification at all. However, emotional connection with one’s work runs into many many dangers at the micro-level, conflict with a boss, frustration with progress in research or any other conflicts can cause this emotion to dry off. The only thing that keeps people involved in slow-moving unyielding boring work is the hope of making it big. If you can possibly make it big, your family and siblings and you will have a much better future than they have now.</p>
<p>Now think about boring tasks like say bricklaying. Why would someone possibly be passionate about it? One is doing the job to put bread on the table, that is all. The only way they can be motivated to work really well at it is to show them how could they one day possibly make it big say have their own bricklaying company.</p>
<p>Communism, however, says you work hard and everyone will have a good house. ( <a href="https://en.wikipedia.org/wiki/From_each_according_to_his_ability,_to_each_according_to_his_needs">From each according to his ability, to each according to his needs - Wikipedia</a></p>
<p>). That builds really good momentum in the start as people are emotionally connected to their labour changing community. (You can see it in any communist/socialist regimes early days). However, that is really hard to pull off in the long term, one person working hard is not even sure to make just that one person’s living condition better, putting the burden of the entire country on them would basically make sure that their returns are either delayed or diminished. This kills of motivation to “make it big!”.</p>
<p>What I have written is “Communism by the book”, combine it with the gatekeeping done in the name of “loyalty” to “revolution of the people” and it gets worse.</p>
<p>The only people under Communism are people who are lucky enough to work in a field that they like and are not very affected by returns. There is a reason the Soviet Union could build a Space Shuttle (the only country apart from the US to build it) but was unable to construct a building on time to keep these shuttles. (This was the opinion of one of the Soviet scientists interviewed on many Buran documentaries I watched as a kid) There was no reason for the people making the hangar to work hard, unlike scientists working on the space shuttle.</p>
<p>Communism would be crazily successful if it can solve the problem of motivation.</p>
<h3 id="q-my-answer-to-is-democracy-still-a-good-form-of-governance-in-the-era-of-artificial-intelligence-where-behaviour-of-mases-can-be-predicted-or-influenced">Q. My answer to “Is democracy still a good form of governance in the era of artificial intelligence where behaviour of mases can be predicted or influenced?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNiLaG">https://qr.ae/pNiLaG</a></p>
<p>I don’t think one can answer this question without getting political, but I will try to quote others mostly rather than giving my own opinions.</p>
<p>“<em>Is democracy is a good form of governance ?”</em></p>
<p>Yes, it was probably the best when modern democracy was invented in US/France and for the next 250 odd years (which is till now). There is no better form of running a system than consensus among its components (which is people in a society). Democracy is the closest we can reach to consensus until now and even sometime in the foreseeable future. <a href="https://www.tandfonline.com/doi/abs/10.1080/01944369908976071">Consensus Building and Complex Adaptive Systems</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image15.jpeg" alt="" /></p>
<p>Democracy was envisioned as a way of building consensus among people about how they want their government to run. It was built with good intentions, “all men are equal”, “most deserving person would be the king” and later it adopted things like “minorities should have human rights” and “women should be considered to equal to men” and so on. If you look at human evolution, all these are relatively new concepts and these were adopted in liberal democracies.</p>
<p>However, the fundamental aspect of democracy was consensus among people to run the government. Consensus was not something that appeals to many people, but “Republic” does (one of our own ruling the country) does. To think of that someone from among the common people can be the ruler one day sells very well to common people.</p>
<p>The trick of running government for an elite in democracy was to use the information disbursal methods available (MSM like TV, radio, newspaper) to manufacture consensus. US and France developed the ways to run democracies and being world powers (France in 1800s and US 1940 onwards) exported the political thought. When you look at it, very rarely are the elected leaders from among common people.</p>
<p>In UK, you have <a href="_blank">Oxbridge - Wikipedia</a></p>
<p>and <a href="https://www.theguardian.com/education/2017/feb/23/ppe-oxford-university-degree-that-rules-britain">PPE: the Oxford degree that runs Britain</a></p>
<p>.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image16.png" alt="" /></p>
<p>In other countries, you have political dynasties :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image17.jpeg" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image18.jpeg" alt="" /></p>
<p>Democracies are built around shielding and decorating these leaders elected from “among the people” as ideal. No one wants to be ruled by the neighborhood a$$hole. If it sounds like conspiracy theory, we can look at Herman and Chomsky’s work : <a href="https://en.wikipedia.org/wiki/Manufacturing_Consent">Manufacturing Consent - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image19.jpeg" alt="" /></p>
<p>The entire premise of the book is that MSM is what makes democracy runs. Basically by highlighting facts selectively and sometimes just by lies. Chomsky claims that that the entire War on Terror thing was sold to Americans by the media. (So basically he says they could have just killed Osama-Bin-Laden in retaliation of 911 rather than attacking and capturing Afghanistan and Iraq). I was a kid when this happened, so I don’t remember anything about what US media used to say about Afghanistan then, but I suppose funding such a huge war would have taken some convincing to do.</p>
<p>All I remember is Hindi media making America attack Afghanistan thrice before they actually did and showing F 117s on TV !</p>
<p>I am not trying to portray that elites do gatekeeping only in democracy, that is the reason why people got into the concept of democracy as they thought elites used to run the country in traditional monarchies. Here is a drawing from French Revolution :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image20.jpeg" alt="" /></p>
<p>Whenever, people are tired of their elite, they will look for new ones. Elites who favour government run economy vs those who favour large monopolies. Elites who rule through a royal family vs those who rule through a republic. Quoting Naval Ravikant :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image21.png" alt="" /></p>
<p>- <a href="https://moneyfyi.wordpress.com/2020/05/27/wisdom-from-naval-ravikant/">Wisdom From Naval Ravikant</a></p>
<p>I would say democracy as such is finding it hard as the human society it sought to run has changed drastically in last few decades than from earlier. The means of information disbursal have changed ! The tools that made liberal democracies tick are now doubted by many. Now the few ways for liberal democracies to go ahead are : A. Adapt to this new information regime. B. Resist the rapid spread of information or C. Become Irrelevant and wither off.</p>
<p>In words of Naval Ravikant again (will not quote him henceforth in this answer, I promise) :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image22.png" alt="" /></p>
<p>If democracy goes, we will just be switching to new elites, whose policies we think are better for us, just like in 20th century we thought that democracy was better for us people than monarchies and colonialism.</p>
<p>“<em>Masses can be predicted or influenced”</em></p>
<p>Was there ever a time when they weren’t influenced. Social Media/AI/Internet is just a more efficient tool to do so. That is the reason why disrupted old medium (plain old authority/ TV, newspaper cry foul about modern means, as they can distribute much more viral information in a much better way). It was never like that masses weren’t lead or predicted. Some more details in my other answer here:</p>
<p><a href="https://www.quora.com/Is-artificial-intelligence-already-controlling-us-in-the-form-of-tech-giants-manipulating-people-via-algorithms/answer/Muktabh-Mayank">Muktabh Mayank’s answer to Is artificial intelligence already controlling us in the form of tech giants manipulating people via algorithms?</a></p>
<p>I interacted with Economist Branko Milanovic on Twitter regarding this</p>
<p>Facebook didn’t break democracy. It just made people mode aware about the dirty reality !<br />
Solution is not to stop Facebook, but rather redressing grievances of commoners. <a href="https://t.co/e0LpP8Dxi2">https://t.co/e0LpP8Dxi2</a></p>
<p>— Muktabh Mayank (@muktabh) <a href="https://twitter.com/muktabh/status/1299814184410963968?ref_src=twsrc^tfw">August 29, 2020</a></p>
<p>He believes that all social media (and other modernities like internet) has done is expose the dark underbelly of democracies rather than actually creating any problem themselves.</p>
<p>That’s so obvious! Incredible there are people who do not see it</p>
<p>— Branko Milanovic (@BrankoMilan) <a href="https://twitter.com/BrankoMilan/status/1299814496362475523?ref_src=twsrc^tfw">August 29, 2020</a></p>
<p>Regulating Social Media will just transform it. Democracy either needs to adapt or be replaced. There is no way it will be able to stop progress. Humanity has defied all other concepts apart from progress.</p>
<h3 id="my-answer-to-what-will-happen-if-india-embrace-meritocracy">My answer to “What will happen if India embrace meritocracy?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNaNH3">https://qr.ae/pNaNH3</a></p>
<p>I saw this question a few days back when I was reading about the topic. What coincidence ! As a founder, you take time to read and finish things and so did this one and hence answering today.</p>
<p>My views about Meritocracy have changed a lot after reading the recent book by Markovits. <a href="https://en.wikipedia.org/wiki/Daniel_Markovits">Daniel Markovits - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image23.png" alt="" /></p>
<p>While there was a lot of hype in media about the book which somehow makes “meritocracy” sound like a bad thing, but that is not the message I took out of it.</p>
<p>Some points I see coming out of it (specially in the context of India):</p>
<p><strong>(Unlike what we think), Merit often doesn’t really measure innate intelligence</strong></p>
<p>“Merit”, unlike what most people would intuitively believe is not always innate. There are a few <a href="https://en.wikipedia.org/wiki/Child_prodigy">Child prodigy - Wikipedia</a></p>
<p>that do make it big, but try and remember the smartest kid in your school, are they really the most successful people when your school alumni association meets ? Not too often. Another very important point, when you are studying at the nation’s top institutions, like say IITs or IIMs (specially IIMs, which test students on many criteria than just on class 12 maths/science in IITs, which is somewhat of a equilizer) , how many people do you see coming from tier 1 cities, tier 2 cities and tier 3 cities ? Let’s look at other top institutions : NLSIU, NIFT and so on. IMO tier 1 and tier 2 cities are much more heavily represented than tier 3 cities and villages. That said, more people live in tier 3 cities and villages. A lot of people who come to top institutes from say a village often make a conscious choice about moving to a city to complete their education. Remember the word “choice” from here. What I want to say is that conditioning/environment is almost always more important than sheer innate intelligence one is born with. People don’t like to believe that, but that is the truth. Let us talk more quantitatively. The universities system of US, which most of the Indian middle class treats as some kind of beacon of “meritocracy” is almost totally biased towards rich kids : <a href="https://academic.oup.com/qje/article/135/3/1567/5741707">Income Segregation and Intergenerational Mobility Across Colleges in the United States*</a></p>
<p>. I mean its pretty clear what is going on here:</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image24.png" alt="" /></p>
<p>Most Americans attending their top universities are RICH ! Most poor kids won’t reach the top colleges (colleges which are supposed to change one’s fortune). And its not because the system is rigged, No. Rich kids are just better trained and conditioned and they become better than the poor kids by college admission age. I am pretty sure this division is in India too. More rich kids than poor ones are successful, more rich scheduled caste kids than poor schedule caste kids (the poorest of poor in India) are successful. And its not because the system is rigged, better environment, better coaching/tutions etc over many years compound to make the rich kids actually much better. They are more meritorious. Innate/Natural genius and talents seldom carry a person for their whole life.</p>
<p><strong>Meritocracy is thus not what most people think</strong></p>
<p>Meritocracy was meant to be a system of government where the meritorious come up due to their innate talent and lead the world. What actually happens is the people who actually come up as leaders are not the ones who are the most talented but the ones who are desperate about becoming a leader. There are many shortcut/hard ways to game the accepted process which makes one the leader.</p>
<p>So there are “Social Climbers” ( <a href="_blank">Parvenu - Wikipedia</a></p>
<p>), promiscuity : <a href="https://nypost.com/2018/06/14/shocking-number-of-americans-have-sex-at-work/">Shocking number of Americans have sex at work</a></p>
<p>,</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image25.png" alt="" /></p>
<p>sheer brute force (violence is not unheard of in politics), just looking good (fashion / being born beautiful/ plastic surgeries) : <a href="https://www.psychologytoday.com/us/blog/games-primates-play/201203/the-truth-about-why-beautiful-people-are-more-successful">The Truth About Why Beautiful People Are More Successful</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image26.png" alt="" /></p>
<p>and lifelong practice. The more time one can take out of their schedule and practice, the better they can get at their skill.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image27.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/Outliers_\(book\)">Outliers (book) - Wikipedia</a></p>
<p>This hardwork rule (or 10000 hour rule of success) is what most people accept and acknowledge among other ways to game the meritocracy system. Someone who wants to get on top will need both A. To practice hard and B. To address their weaknesses during this practice (for 10000 hours as you can guess) and become undefeatable in the field.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image28.png" alt="" /></p>
<p>This means two things, the society and surrounding should be willing to give individual enough time to focus for 10000 hours (that is rare depending upon how demanding the situations one lives in are) and provide mentorship to help them identify their weaknesses (its hard to find good mentors for everyone). To describe a limiting case, you will not be a mathematical genius if you solve the same maths problems repeatedly for 10000 hours. So, an oversight can help channel hard work into success more often.</p>
<p>A more day-to-day example I would give from Indian meritocracy is the emphasis on exam scores to be successful (get internships, get into a good college, get a good job). The people who work hard to become good at a subject, will become good at it, but will not necessarily get better marks than someone who has spent all their time and energy in making sure they would score well in exams. There are ways to be more efficient to score better in exams, looking at last year papers, focusing on parts of course where solving questions is easier and choosing subjects to give an exam wisely. India’s meritorious people are thus who are able to work hard get good scores in exams (which is possibly still more meritocratic than people who can influence others becoming meritocratic say like in US, you can use looks/pedigree and many other things which even bypass hardwork).</p>
<p>India’s top exams , which selects people who would run India for their life: <a href="https://en.wikipedia.org/wiki/Indian_Administrative_Service">Indian Administrative Service - Wikipedia</a></p>
<p>, is easier to get through in some subjects than others. This hack has been used for really long and is an open secret. {Even I know it being an outsider}. Now whether someone is good enough at psychology is a good indicator of them being good leaders is a different question, but you should understand that gaming “psychology exams” is much easier than proving “Leadership Skills” or what the army calls OLQ : <a href="https://www.ssbcrack.com/2011/07/top-15-olqs-officer-like-qualities.html">What Are Top 15 OLQs- Officer Like Qualities</a></p>
<p>. Army officer selection is relatively less transparent due to this.</p>
<p><a href="https://www.careerindia.com/tips/which-is-the-most-opted-optional-subject-in-ias-022161.html">Which Is The Most Opted Optional Subject In IAS?</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image29.png" alt="" /></p>
<p>So, frankly, Meritocracy is the class of people who can game the system well. No one is really going to get ahead by “innate” characteristics.</p>
<p>Before one makes an opinion like “f**k riiich people”, looking at the thoughts above, let me clarify that I am not saying that the system is rigged. Its not, meritocratic people just optimize to get the best gain out of the system. Another thing is not all rich people are meritocratic, I will describe who exactly forms the meritocracy according to the book in next section. I will also describe what exactly does meritocracy functions. Unlike being wealthy, anyone can be meritocratic and climb life’s ladder.</p>
<p><strong>Who are meritocrats</strong></p>
<p>As I said earlier, being meritocratic means being capable to game the system. Keenly observation about what optimizations yield better returns than what an average person is doing and placing many such bets gives accumulated benefits. Modern meritocracy is basically investing into kids to convert them into very refined products. Be in no doubt, Indian parents (specially Indian middle class parents) are very good at that and that is why <strong><em>India is quite close to a meritocracy</em></strong>. They recognize importance of good guidance and investment to make their kids good at skills that get them non-linear returns. So are jews and other asian communities (at least the tiger mom stereotype I see on media). Indians might have a lack of information and resources (which is a different problem), but boy they invest money into their kids’ future much more than what they are capable of. Where they spend that money though keeps changing depending upon the perception that is created in their minds around the success landscape. IIT coaching classes when I was in high-school and WhiteHat Jr now 15 years later in 2020.</p>
<p><strong>Meritocracy is a choice</strong></p>
<p>Another thing one needs to realize is that any system can be gamed. Most liberal democracies, colonies before them, monarchies all of them. Also anyone can game the system. This is unlike wealth, which is harder to collect at level ZERO. One just needs to make sure their kids are really good at a few things (that the world demands) they are not good at. In India, this is so common that its not even a talking point. There are cultures where this is rare btw. But there are problems like wrong perceptions about where investments need to made, how much investment of time and money and what exactly is in demand.</p>
<p>One thing one needs to understand is that wanting to be meritocratic is easy, being meritocratic is hard. To be meritocratic, one needs to invest disproportionately into making their kids irresistible to the world. Not making them pampered and entitled. The kids brought up to be irresistible will have less social interaction, will spend more time at practice than having fun, will have to make delayed gratification decisions all their lives and will always have to strive to get better. There small profit making decisions aggregate to give them very high returns than average kids. Markovits explains it much better in the book than how I explain it here, maybe in not as much of a positive context. This is a marathon and not sprint, some parents will not be sure why their kids are not successful after they bought them a degree (or they got them into a movie), the reason is they can buy momentary degree or opportunity, but they cannot buy “needing their kid” from the world.</p>
<p>Basically, its a choice. Do you want to get ahead, than have less fun and plan according to future. I explained in another answer how many Indians make multiple loss making decisions in their lives : <a href="https://www.quora.com/What-do-people-who-are-more-than-45-years-old-do-after-getting-fired-from-their-job-due-to-cost-cutting/answer/Muktabh-Mayank">Muktabh Mayank’s answer to What do people who are more than 45 years old do after getting fired from their job due to cost cutting?</a> . To move ahead, one needs to cut them down according to both Markovits and Gladwell.</p>
<p>As you can guess, this is not going to be easy and a lot of people will not be able to suppress themselves all their lives. That is where meritocratic people win. They sacrifice their today for big gains in future, which most other won’t do. When you hear “rich keep getting rich”, you need to understand that the same people and families don’t stay in the “rich” bracket over time. Rich people of 2020 are richer than Rich people of 1920, but they are not necessarily the same families. Some meritocratic families would still be there, many new meritocratic families would have entered, some families would have squandered their wealth away.</p>
<p><strong>Meritocracy is a very powerful moat, just like Aristocracy</strong></p>
<p>Ok, this is possibly the thoughts from Markovits’s book that creates controversy. He says while some people would want to game the system and move ahead whatever it is, others would just want to have similar returns as the meritocrats. This would create friction in society, because :</p>
<p>A. Non Meritocrats wont really realize the amount of investment meritocrats do to make them indispensable.</p>
<p>B. Meritocrats treat non-meritocrats as idle freeloaders.</p>
<p>Possibly more so in America that has many parallel cultures, some very meritocratic and some not at all. In India, however, I don’t see a lot of this divide, people just value hard work. Maybe because of teachings of Gita or something : <a href="https://en.wikipedia.org/wiki/Bhagavad_Gita">Bhagavad Gita - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image30.png" alt="" /></p>
<p>However, the recent nepotism debate after SSR’s death can be looked at with this lens. SSR is exactly what one would see as a meritocrat and people think of the obstacles in his career as slakers stopping a hard working person.</p>
<p>Look at what Sushant says in this Pew Die Pie video and try looking at the description of meritocracy :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image31.png" alt="" /></p>
<p>https://youtu.be/FXTgITg-UAM</p>
<h3 id="my-answer-to-why-are-imported-goods-sometimes-cheaper-than-local-goods">My answer to “Why are imported goods sometimes cheaper than local goods?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNzSYn">https://qr.ae/pNzSYn</a></p>
<p>Introducing my man Mr. Economies of Scale here. <a href="https://en.wikipedia.org/wiki/Economies_of_scale">Economies of scale - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image32.png" alt="" /></p>
<p>If two firms have the same technology and same marketing principles , then the one producing more quantity of products might have less production cost. This less production cost can be used to outcompete the rival by keeping goods of same quality cheaper or making more profit to develop better marketing and Research to outinnovate the rival. A multinational firm which is serving more countries has a headstart in the number of items produced and can use economies of scale to drown smaller companies.</p>
<p>Economies of Scale is a differentiator purely on the amount of products a company sells rivaling products of same quality, but there are other more prominent differentiators which won’t even allow a local product to be equivalent to a multinational firm’s product. Headstart in research, better machinery, more experienced managers than a local rival can allow a multinational company to have a very competitive price as compared to a local rival.</p>
<p>All factors above are ethical factors. Multinational companies with large amount of cash at hand might practice dumping <a href="https://en.wikipedia.org/wiki/Dumping_\(pricing_policy\)">Dumping (pricing policy) - Wikipedia</a></p>
<p>to make sure that local rivals die giving them a monopoly.</p>
<h3 id="my-answer-to-if-communism-makes-people-poor-then-why-is-china-poised-to-become-the-worlds-biggest-economy-in-2028">My answer to “If communism makes people poor, then why is China poised to become the world’s biggest economy in 2028?”</h3>
<p>Originally answered here: https://qr.ae/pNJvgf</p>
<p>Because China doesn’t follow “Communism”. China’s political ideology is <a href="https://en.wikipedia.org/wiki/Socialism_with_Chinese_characteristics">Socialism with Chinese characteristics - Wikipedia</a> , which is not what Mao Zedong had in mind when he established the communist state in 1940s-50s. <a href="https://en.wikipedia.org/wiki/Deng_Xiaoping">Deng Xiaoping - Wikipedia</a></p>
<p>was a very pragmatic leader, who modified China’s brutish economy into the modern one we see today and he did by slowing transforming Communist economy of China into Political Capitalism. Xiaoping knew that communist policies would not work to get his people out of poverty, so he thought of using capitalism to achieve Communism’s goals : A. Drive people out of poverty, B. Maintain hegemony of the communist party. His famous quote “it doesn’t matter if the cat is black or white as long as it catches the mice” was given with this exact thought in mind.</p>
<p><a href="http://www.kropfpolisci.com/chinese.state.capitalism.pdf">http://www.kropfpolisci.com/chinese.state.capitalism.pdf</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image33.png" alt="" /></p>
<p>Most westerners {and Indians} would dread this idea calling it cronyism, but its working and is working really well for China. {and other Asian countries}. The idea for this form of economy came from none other than Singapore’s “anti-communist” premier Lee Kuan Yew and officials from Singapore guided China’s transition from “Communist Economy” to “Socialism with Chinese Characteristics”.</p>
<p><a href="https://mothership.sg/2018/11/deng-xiaoping-singapore-china-george-yeo/">Deng Xiaoping visited S’pore in 1978. Here’s the impact it left on Sino-S’pore relations 40 years on.</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image34.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image35.png" alt="" /></p>
<p>So no, China is not the “Communist” country like one would think of. Its not even close to Soviet Union, which was a communist economy. Its a pragmatic authoritarian regime, something that would be called fascist and crony of the rich if it were running in India.</p>
<h3 id="my-answer-to-as-a-result-of-the-fourth-industrial-revolution-will-any-job-be-lost">My answer to “As a result of the Fourth Industrial Revolution, will any job be lost?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNxz0V">https://qr.ae/pNxz0V</a></p>
<p>A few jobs will be lost, most jobs will change or evolve and many new jobs will be created IMO. This is not a new phenomenon, just continuation of human progress.</p>
<p>There are many jobs which existed during 20th century which don’t exist now :</p>
<p><a href="https://www.dailymail.co.uk/home/books/article-1262627/Finding-punkah-wallah-essential-Raj-tips-THE-COMPLETE-INDIAN-HOUSEKEEPER-AND-COOK-BY-FLORA-ANNIE-STEEL-AND-GRACE-GARDINER.html">Finding a punkah-wallah, and other essential Raj tips: THE COMPLETE INDIAN HOUSEKEEPER AND COOK</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image36.png" alt="" /></p>
<p>Look at the jobs Indians are doing in this photo during colonial times. Working a handfan and clipping toenails. Both these jobs don’t exist now. Due to electrical appliances and India no more being ruled by entitled white people unable to cut their own toenails, our people can focus on more productive jobs.</p>
<p>Similarly just a few generations back, if people had to send any important message, they had to go to this person :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image37.jpeg" alt="" /></p>
<p>The telegraphist. My grandfather used to tell me that people went into a shock just by hearing they have received a telegram as they feared it would carry bad/emergency news. Most news that one could afford to send over wires required emergency action. Millenials in India {including me} haven’t seen a telegram in their life.</p>
<p>Let’s talk of something many millenials [and maybe Gen-Z’s would have not] would have seen in their life :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image38.jpeg" alt="" /></p>
<p>How many PCO operators do you see now ? As a kid, I remember using PCOs sometimes.</p>
<p>Technology changed jobs of telegraphists to PCO operators to SIM Card/Phone salesman/technician . Old jobs were replaced by new and more jobs. Was it painful or hard ? Maybe, but not as hard as what people imagine switching jobs is.</p>
<p>If you watched the movie Dum Lagake Haisha, you would have seen the jobs Ayushmann Khurana did in the movie. Recording songs on audio cassettes and how new technology [CDs in the 1990s] were slowly impacting his business and he decided to switch. This is how better technology and disruption impacting a job looks like. <em>It requires one to change and relearn, but is gradual and at a pace people can adapt to.</em></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image39.jpeg" alt="" /></p>
<p>When I was a kid [and this is long back, possibly the oldest things I could remember], I could get my favorite songs recorded on a cassette, 8 in one cassette. It was costly enough to have a discussion in the family about what songs are good enough to find a place in the cassette. If the “cassette recorder” found some extra space on the tape because the songs were relatively smaller, they would put a few bonus tracks ! While this is all good for nostalgia, what dismal piece of technology compared to today.</p>
<p>Let’s talk about jobs from India which are no more done now and most millennials have not seen anyone doing.</p>
<p>Bhishti or Waterman, who carried drinking water</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image40.jpeg" alt="" /></p>
<p>Cavalry Soldiers :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image41.png" alt="" /></p>
<p>We don’t have anymore mounted soldiers because well they serve no purpose in modern warfare. Till the world wars, mounted regiments and lancers were important. The famous win by Indians in World War 1 was all by cavalry forces. <a href="https://en.wikipedia.org/wiki/Battle_of_Haifa_\(1918\)">Battle of Haifa (1918) - Wikipedia</a></p>
<p>Even the jobs which have been around for a considerable time have evolved in scope and a literally new jobs now bearing the same old names.</p>
<p>For example, my ancestors who were clerks by caste had to learn three languages just to maintain records in British ruled India. That would have been too much work, juggling between Roman {to write English for the British sahibs}, Persian {because of previous Mughal Rule} and Devnagari {which was not standardized yet because no one cared about the native script, so they actually had a community level standardized devnagari script to keep documents interchangeable} just to keep accounts and records. How inefficient !</p>
<p>Now a days clerks are computer operators. I went in to get a driving license last month and all clerks had to do was fill online forms. [Jobs are not caste based in independent India, clerks now come from all communities] , I hardly think even the jobs that survive automation are the same jobs as ones pre-automation.</p>
<p>What I am trying to say that new technology has been making jobs obsolete forever and creating new jobs which are gradual progress from the old ones. Fourth Industrial Revolution is a name for technologies that would drive changes in the 21st century : AI, IoT, Blockchain, CRISPR, 3D Printing and so one. They will create new jobs which will be evolution of current day jobs but would make humanity more efficient. As long as we can ensure people can relearn and adapt to new jobs, it is mostly going to be fine. There is lot of sensationalism in the media which makes people fear that they suddenly one day become useless in the workforce, but they need to understand such things are not sudden and gradual. New technologies are made in a way that it is easy to learn for people already experts in that domain. So Chill !</p>
<p>Another fear that is being circulated is <a href="https://en.wikipedia.org/wiki/Artificial_general_intelligence">Artificial general intelligence - Wikipedia</a></p>
<p>just replacing humans from all jobs. That fear is like Aliens attacking Earth and making it a colony. It is possible, but it becoming true suddenly is not that high probability an event. Are we worrying about alien invasion and developing space warfare ? No. Current AI technology is : A. Gradual to evolve and B. Has limitations both infrastructure and theoretical. AGI with technology existing right now is not possible.</p>
<p><a href="https://tti.tamu.edu/news/it-turns-out-humans-are-pretty-smart-developing-self-driving-cars-is-harder-than-we-thought/">It Turns Out, Humans Are Pretty Smart: Developing Self-Driving Cars Is Harder Than We Thought</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image42.png" alt="" /></p>
<p>We will have AI aided driving very soon, maybe in 2020s. Even full self driving might be possible in special conditions. But replacing humans altogether is not a scenario I foresee. I can be proven wrong, but that is not how it looks right now.</p>
<h3 id="my-answer-to-i-have-never-ever-bought-anything-based-on-a-telemarketer-cold-call-or-an-email-or-text-or-an-online-ad-why-are-corporations-unable-to-discover-this-fact-about-me-in-this-age-of-ai-big-data-and-brazen-privacy-invasion">My answer to “I have never ever bought anything based on a telemarketer cold call or an email or text or an online ad. Why are corporations unable to discover this fact about me in this age of AI, Big Data and brazen privacy invasion?”</h3>
<p>Originally answered here: https://qr.ae/pNaHUO</p>
<p>Good question.. web marketers / telemarketers / email marketers know that you are not going to purchase things on seeing ads. They are not mostly trying to sell to you, just trying to occupy some real estate in your mind. If you buy immediately or soon after seeing the ad or receiving the call, its a bonus, not the intention.</p>
<p>My remaining answer is my subjective interpretation of the following McKinsey article : <a href="https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/the-consumer-decision-journey">The consumer decision journey</a></p>
<p>Before information age, people had a specific set of brands to choose from. Say 3 brands to buy a car from , 5 to buy a refrigerator from and 10 to buy detergent from. This was a number buyers could remember and all these brands needed to do was explain their utility with respect to competitors and try to change decision of people who are going to make a purchase.</p>
<p>You would remember the more effective vs competitor ads on Indian television from 1990s. These ads were shown because people were pre-informed about the available brands and brands needed to pitch why they are better than others.</p>
<p>Customer however has become very powerful in the internet age. With internet marketing, D2C brands and supply chain becoming commodity, customers have many many alternatives. Customers are savvy and they will make an effort to read and find out and make a smart decision, but they should know what brands can they Google before a purchase is being made. Ads are targeting that real estate of your mind and memory. The brands bombarding you with information through internet ads and other marketing know that if customer knows that there are alternatives to something they bought recently, they will make the alternative a part of decision making process. The work of finding out pros and cons, value for money etc. customer will be able to do themselves by Google or even better watching reviews on Social Media or Youtube. All the customers need to be told and made to memorize is that there is a competitor.</p>
<h3 id="my-answer-to-how-did-elon-musk-manage-to-become-the-richest-person-in-the-world-with-companies-that-arent-even-profitable-yet">My answer to “How did Elon Musk manage to become the richest person in the world with companies that aren’t even profitable yet?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pND8uy">https://qr.ae/pND8uy</a></p>
<p>Chill ! Don’t be so hard on a person who has actually done something about humanity’s future. Elon Musk’s businesses and ideas {Mainstream EVs, Hyperloops, Private Space Exploration, Satellite internet services, brain implants for human hivemind, OpenAI, Affordable Solar} are almost all going to change humanity for future directly or indirectly. I personally think he deserves being the richest man alive just for his effort.</p>
<p>I am pretty sure that the person who asked this question will need to understand how precarious situations for entrepreneurs are. Elon is very rich in invisible dollars, like you having a deposit in a bank you cannot cash for years, except that the deposit can crash & burn anytime. A lot of his wealth is just people speculating about how good a company can he build and he cannot even spend it, or even be safe in the fact that the wealth would stay with him forever. As a rich [or even small] tech entrepreneur, one’s wealth is just the valuation of their company which is determined by others who can someday stop giving the same value to company. Unlike say old-money people [royalty, politicians, celebrities], entrepreneurs have all eggs in one high risk basket. Having 1 Million US Dollars in a safe mutual fund is much more sure money than having 10 M US Dollars in equity valuation. Unlike old money, who have lot of money invested in safe places, almost all of a tech [or even other] entrepreneur’s worth is locked in their venture that can go up and down like crazy. Its much more validation than wealth. Not a bad thing to have wealth in the way entrepreneurs have [that basically means you are a leader and people believe in you], but seldom means you are super “rich” in sense common people think.</p>
<p><em>Having shares in a high valuation company is not at all like founders have been rewarded with hordes of cash before they have achieved anything. All that means is people like them as leaders. If these entrepreneurs do well in future, they might eventually cash all their validation out. [That seemed like the central premise of question, how can they get rich if company doesn’t churn profit ?]</em> So unlike some oil barons, a somewhat successful startup founder cannot spend like there is no tomorrow, despite of being much worth than oil money they make.</p>
<p>Elon Musk has been trusted to become the best business leader of the world and thus he is the most valued man, but he is not really the “richest” IMO. He might eventually become the richest if he delivers.</p>
<h3 id="my-answer-to-why-do-global-stock-markets-rise-even-during-an-economic-collapse">My answer to “Why do global stock markets rise even during an economic collapse?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNaYAl">https://qr.ae/pNaYAl</a></p>
<p>One thing that you might notice is that not all stocks are going up :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image43.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image44.png" alt="" /></p>
<p>and some have hardly reached their pre pandemic numbers or around those numbers :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image45.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image46.png" alt="" /></p>
<p>And while some of them are , whoa just look at the Y axis :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image47.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image48.png" alt="" /></p>
<p>Investors are pouring money into stocks they think are going to lead the world post-pandemic. People have formed new habits and governments suddenly have much more power in order to keep the economy alive, the way they had after the world wars. So investors have recognized the trends and are investing to gain from the movement of humanity towards :</p>
<ol>
<li>
<p>Tech trends like internet gaming, software, shopping and online / remote work will mostly continue.</p>
</li>
<li>
<p>Governments getting much more power to make economy survive would make sure fundamental changes in infrastructure would happen in lieu of old sectors getting redundant to keep economy in motion, (think renewable energy and electric vehicles). Just like post World Wars we had the American Highways and Marshall plan.</p>
</li>
</ol>
<p>Governments also have printed tonne of dollars - <a href="https://en.wikipedia.org/wiki/Quantitative_easing">Quantitative easing - Wikipedia</a></p>
<p>(specially US government) to finance point 2 above and to keep the existing economy in motion (individuals will just hold on to their cash during crisis, so government prints more money and pushes it down the economy to keep people earning, <a href="_blank">The General Theory of Employment, Interest and Money - Wikipedia</a>) .</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image49.png" alt="" /></p>
<p>While for some people this extra printed money will just make sure they don’t lose their jobs in a sector which is totalled and can put bread on the table, other people who accumulate some of this money will invest it into 1 and 2 (because they are sure to grow) reinforcing these trends. This extra money being printed + invested shows you growth in not just US market, but also other markets where money is flowing and is being invested.</p>
<h3 id="my-answer-to-is-economic-disparity-among-countries-driving-covid-vaccine-distribution-inequality">My answer to “Is economic disparity among countries driving Covid vaccine distribution inequality?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNJzV9">https://qr.ae/pNJzV9</a></p>
<p>I don’t think that is always true. There is economic disparity between countries, but its not a result of economic disparity that vaccinations will happen at different rates. IMO a mixture of economic policy and population’s approach to life is what gives countries different standing in terms of COVID vaccination.</p>
<p>For example, Russia which is the 11th largest economy and India which is the 5/6th largest economy but has a low per capita income number will be much more secure in vaccinations than many economies who have better per capita income than them. China is a wealthy country, but not wealthiest per capita and it would fare much better than countries richer than it. Israel is a relatively small economy but is leading the world in %vaccination. US already has secured enough vaccines for its entire populations, but their rate of vaccination is slow.</p>
<p>I think there are <strong><em>three things that when all combined together</em></strong> make a country more secure about vaccine :</p>
<ol>
<li>
<p>High Purchasing Power, irrespective of the fact if the total economy is small or large. That is administering vaccine to a huge population is not super duper costly.</p>
</li>
<li>
<p>Having indigenous industries and not depending on other countries for supply chain. This means both production and supply catering to local demand.</p>
</li>
<li>
<p>Having an infrastructure set to drive vaccinations. You need efficiency in administering vaccines too.</p>
</li>
</ol>
<p>So for example Israel will be able to close acquiring all required dosage by April.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image50.png" alt="" /></p>
<p><a href="https://www.haaretz.com/israel-news/.premium-israel-to-produce-15-million-doses-of-its-covid-19-vaccine-research-institute-says-1.9338501">Israel to produce 15 million doses of its COVID-19 vaccine, research institute says</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image51.png" alt="" /></p>
<p>And given its speed of administration, its not going to take much more time for them to make the population 100% vaccinated :</p>
<p>We have just updated our <a href="https://twitter.com/OurWorldInData?ref_src=twsrc^tfw">@OurWorldInData</a> COVID vaccination dataset: <a href="https://t.co/lQZYjLUdPK">https://t.co/lQZYjLUdPK</a></p>
<p>Israel has by now vaccinated 11.5% of their population.</p>
<p>The country is rapidly getting to a point where mass deaths and mass lockdowns are over. <a href="https://t.co/GtRCHnYGmo">pic.twitter.com/GtRCHnYGmo</a></p>
<p>— Max Roser (@MaxCRoser) <a href="https://twitter.com/MaxCRoser/status/1345036113925332993?ref_src=twsrc^tfw">January 1, 2021</a></p>
<p>Compare this for example to the US, which already has all the required dosage and is much much wealthy than Israel :</p>
<p>We’ve become That Country where people shrug and expect failure and make excuses <a href="https://t.co/HvJqnUPl5z">pic.twitter.com/HvJqnUPl5z</a></p>
<p>— Noah Smith 🐇 (@Noahpinion) <a href="https://twitter.com/Noahpinion/status/1344123825718325250?ref_src=twsrc^tfw">December 30, 2020</a></p>
<p>US gets behind on 3rd point [its better at 1 and 2] as compared to Israel because of the bottom up way in which country is structured. States leading vaccinations might have been better maybe ?</p>
<p>Different countries face different challenges in vaccinations. While countries where 1,2 and 3 are available, these challenges are simpler like : “How to create confidence in the vaccine ?” and “How to subsidize the vaccine ?”. Countries lacking 1,2 and 3 have more basic questions like “How to outbid other countries to procure the vaccines fast?”, “Who will administer the vaccine ?” or “Where to get the money to buy the vaccines ?”.</p>
<p>While Russia is thinking of ways to create confidence in its vaccine :</p>
<p><a href="https://www.dailymail.co.uk/news/article-9020827/Russia-starts-vaccine-drive-Nurses-Moscow-Sputnik-V-jabs-risk.html">Russia starts its vaccine drive</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image52.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image53.png" alt="" /></p>
<p>India is solving a cheap vaccine problem to buy and transport for its relatively less income population.</p>
<p><a href="https://in.news.yahoo.com/covaxin-cost-less-water-bottle-144320669.html">COVAXIN will cost less than water bottle: Bharat Biotech MD</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image54.png" alt="" /></p>
<p>and it seems its close to achieving that goal : <a href="https://www.medrxiv.org/content/10.1101/2020.12.11.20210419v1">A Phase 1: Safety and Immunogenicity Trial of an Inactivated SARS-CoV-2 Vaccine-BBV152</a></p>
<p>Indian indigenous vaccines like COVAXIN above and COVISHIELD {OxfordAstrazeneca’s Indian variant} can be stored in normal fridges and dont require tempratures of -20 - -50 degree celsius like other vaccine. India is ready to press the paddle on vaccination too due to its homegrown vaccine advantage and competition.</p>
<p>Covishield rollout in a matter of days, likely by 2nd week Jan. Serum Institute of India (SII) has 50 million doses ready to move, and will be scaling up manufacture now. Big nationwide dry-run tomorrow. <a href="https://t.co/q23SsZOQmg">pic.twitter.com/q23SsZOQmg</a></p>
<p>— Shiv Aroor (@ShivAroor) <a href="https://twitter.com/ShivAroor/status/1344985599267143682?ref_src=twsrc^tfw">January 1, 2021</a></p>
<p>China has a similar advantage : <a href="https://abcnews.go.com/Health/wireStory/china-conditional-approval-sinopharm-vaccine-74981163">China OKs 1st homegrown vaccine as COVID-19 surges globally</a></p>
<p>The countries where all 3 points above : 1,2 and 3 are not followed, will have to face sporadic supplies, delays, high costs or going without vaccination.</p>
<p>Since we started talking a few days ago about vaccination rates, Israel has cheerfully accelerated by another 77%.</p>
<p>US… dipped a bit and then kinda wiggled up a tiny amount. No clear trend.</p>
<p>The EU has administered fewer vaccine doses (in absolute numbers) than Israel has. <a href="https://t.co/mBvGLAZTMB">pic.twitter.com/mBvGLAZTMB</a></p>
<p>— Patrick Collison (@patrickc) <a href="https://twitter.com/patrickc/status/1344739686816903168?ref_src=twsrc^tfw">December 31, 2020</a></p>
<p>Argentina, South Africa, Brazil, and Turkey — all countries that hosted vaccine trials — will have to be satisfied with Pfizer’s gratitude, because (like most countries in the world) they won’t be receiving enough of the vaccine to inoculate their populations anytime soon.</p>
<p>— The Intercept (@theintercept) <a href="https://twitter.com/theintercept/status/1344670213846032385?ref_src=twsrc^tfw">December 31, 2020</a></p>
<p><a href="https://www.reuters.com/article/us-health-coronavirus-ukraine-vaccine-idUSKBN294150">Ukraine signs up for China’s Sinovac vaccine, with doses expected soon</a></p>
<p>Mind you SinoVac is not the vaccine China has cleared for internal usage.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image55.png" alt="" /></p>
<p><a href="https://www.bloomberg.com/news/articles/2020-12-29/argentina-kicks-off-vaccination-drive-with-russia-s-sputnik-v">Argentina Kicks Off Vaccination Drive With Russia’s Sputnik</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image56.png" alt="" /></p>
<p>With these countries, you will see some kind of “vaccine apartheid” as intercept calls it. {I think that is a bit too extreme a narrative but still}. The richer, the better to survive.</p>
<p>World faces Covid-19 “vaccine apartheid” <a href="https://t.co/JCxSHvmUDJ">https://t.co/JCxSHvmUDJ</a> by <a href="https://twitter.com/fastlerner?ref_src=twsrc^tfw">@fastlerner</a></p>
<p>— The Intercept (@theintercept) <a href="https://twitter.com/theintercept/status/1344658810628149248?ref_src=twsrc^tfw">December 31, 2020</a></p>
<p>Lessons for the future from here : “Being self sufficient is a good thing during bad times for basic things like food, healthcare, finance and education. Don’t kill off your country’s research and essential services thinking that the international free market will take care of everything.”</p>
<h3 id="my-answer-to-is-it-the-business-of-government-to-run-business">My answer to “Is it the business of government to run business?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNaHlY">https://qr.ae/pNaHlY</a></p>
<p>That’s a political question. Different people will have different opinions around it. You can also have a look at it from many different perspectives : long term, short term, historical. So I guess no need saying the answer is based on my observations and biases, <strong><em>totally subjective</em></strong>.</p>
<p>My answer is “Government should run the business ecosystem, not businesses themselves”.</p>
<p>Some fundamental/historical points about state run businesses :</p>
<ol>
<li>
<p>Starting and running businesses involve taking risk. Absolute more or less risks depending upon what business we are speaking of. Just by supply-demand, businesses with less risks have less rewards as compared to more risk. Remember we are speaking about absolute risks here ie $ values (say INR 50 Lakh which can be wasted or yield profits when invested into a business). There is also something called “risk appetite”, that is what amount of loss a system/individual can suffer without too much of despair. For some poor person, the risk appetite is low, they will get destroyed if they lose 5000 INR, for a richer person, a loss of even 50,000 might not be that bad. (Remember, a loss is always a loss, but having more risk appetite means on losing money one would be sad, but its not like they are done for). हाथी मरा भी तो नौ लाख का is a proverb that tells about high risk appetite of rich/influential societies and countries. So Bill Gates has a high risk appetite and will not be too effected if 10 Crore Rupees he invests in a startup are wasted, while a poor farmer might get in despair if he/she loses 5000 rupees because their risk appetite is low. Its not just starting a business, running a business is similar, one needs to take many hard and risky decisions (taking emergency loans, selling off part of business, downsizing during a bad phase, deciding whether to do more socially acceptable/ economically viable thing in legal limits) and risk appetite is important.</p>
</li>
<li>
<p>Risk appetite of a democratic government is high in absolute terms (say 50 Crore INR for Indian government is nothing much) but low in relative terms (you cannot have even one failed business funded/run by the government, too much social pressure, government run businesses cannot even take a decision which is economically good but has no nonpartisan consensus). That is not a good quality for an entrepreneur, where successes generally come after a few (or many) failures financially/socially. You need to get a few successes to be a good businessman (as you might have heard: failures are just stepping stones to success), but you cannot afford failures in a government because you cannot win elections on failures. So by default, democracies are bad at business. Unless someone has a democratic mandate that, here try out 50 low risk things and show your success at say 10 of them (which will well more than make up for the loss in remaining 40), you are good to go, a democracy cannot be really good at doing business. Unfortunately, politics and media work on highlighting the 40 failures, so avoiding all possible risk is the best way to go, that’s not going to be good in business.</p>
</li>
<li>
<p>A non-democracy OTOH, like Soviet Union / China or a one-party democracy (like post-independence socialist India or Yugoslavia), can take risks. They can enact 50 different ideas and afford for few of them to fail. TINA (There is no alternative), makes the risk appetite go much much higher for the government. Media is sure to not highlight your failures, electorate cannot really vote you out and all you need to make sure is that some of your experiments succeed. Ideal to start businesses. <a href="https://en.wikipedia.org/wiki/Branko_Milanović">Branko Milanović - Wikipedia</a></p>
</li>
</ol>
<!-- end list -->
<ol>
<li>in his book “Capitalism Alone” highlights how Communism/Socialism many was an effective way to develop indigenous industries for countries that were traditionally poor and agarian.</li>
</ol>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image57.jpeg" alt="" /></p>
<ol>
<li>
<p>But here is the question, “Why did both the Soviet Union and Socialist India/Yugoslavia model of economy fail when they rose fast ?”. The reason is IMO looking at history : A. No feedback from market because of monopoly/oligopoly and B. Social/Economic failure of state becomes such a big deal that government would want to control the supply rather than serve the demand to make sure they don’t do a blunder. No one gives a damn about what market wants when you have a monopoly/oligopoly on supply. CEOs (or their counterparts in communist/state run economies) have no incentives on more sales and nothing to lose on poor sales. System prefers law to control supply side rather than using marketing to drive demand (short term solution). Basically, government has too many constraints, businesses already work on uncertainty, adding government constraints to businesses makes them blind to the market. That’s the reason public companies are more often beaten by private enterprises in a free market.</p>
</li>
<li>
<p>China navigated the maze cleverly. They had a centralized economy in the start, but as soon as companies started becoming “too big to fail”, they converted them into a unique “Socialism with Chinese Characteristics” model, where the risk is privately owned and companies follow state’s philosophy. Very pragmatic : <a href="https://en.wikipedia.org/wiki/Socialism_with_Chinese_characteristics">Socialism with Chinese characteristics - Wikipedia</a></p>
</li>
</ol>
<!-- end list -->
<ol>
<li>. So when companies fail, only the people invested in them loose (not the entire country) and when they succeed, they follow China government’s philosophy. The only successful communist regime running over 50 years in the world has rejected state running the business, but continued state “influence” on them. I guess this is the best known method to have state run businesses in all history.</li>
</ol>
<p><strong>One way I see state running businesses :</strong><br />
State’s most powerful attribute is that a low risk bet for state is much bigger than maybe very high risk bet for entrepreneurs. So state can actually start multiple enterprises with small investments, close the ones that fail early and then slowly IPO ones which grow large before they become too big to fail. “Too big to fail” state run companies are the enterprises that generally start bending basic economics as they have power to control supply.</p>
<p>Net positive returns can be used to compensate for losses made in failed enterprises, for welfare state and investing in more businesses. Of course, rules can be made for “critical” companies to make sure a long term harm of country is avoided.</p>
<p>Most state run companies in current world somewhat run in this way. At least in India, all governments (state/central) are encouraging startups with a similar model. However, I am not sure how will democracies react to some startups working out, others failing. Technically VC business is built around the concept of low success rate, but large individual successes, but governments will need to explain this logic well to people. Our bureaucracy is too risk averse and I doubt any of these government policies will be implemented at large scales because no government officer wants to get fired for funding one wrong startup.</p>
<p>What states should necessarily avoid is state run monopolies and employees without any incentives/loss in case of success/failure of companies they work for. If these two remain, even if state is ready to take bets, all bets are very likely to fail. This is what most governments forget and fail at. No one really gets fired at post office for speaking rudely to the poor person who still needs to use post office, no one is asked why post office is making a loss. That’s what needs to change. State run companies should not be looked at just a way to provide employment, they should be required to run profitable/no profit no loss and comply with other metrics.</p>
<h3 id="my-answer-to-what-should-you-know-about-google-trying-to-track-your-data">My answer to “What should you know about Google trying to track your data?”</h3>
<p>Originally answered here : <a href="https://qr.ae/pNZroc">https://qr.ae/pNZroc</a></p>
<p>You should know while you should be concerned about your data being tracked (and the potential big tech has to exploit your data) and you might want to cut out some of the data Google knows about you, not all of “surveillance capitalism” as they call it is evil. There is definitely a way for big tech to target and harm people who don’t conform to what they think is right (and that is why governments, courts and legislatures exist, to make sure discrimination doesn’t happen, we definitely need regulations around this), but that doesn’t mean the entire industry is rigged against the users and there is some evil mastermind trying to manage our lives as a few recently released documentaries show.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image58.jpeg" alt="" /></p>
<p>You are able to find more relevant search results because of some of this data, better offers from different businesses and so on. Be informed that there are experts, powerful people, who could use all the technical terms and blabber their way into being called “customer whisperers”, who used to profit off all the benefits ads based advertisement redirects directly to internet users and they will come up with strong appealing reasons to distrust the entire online advertising industry so that they can go back to the old ways of making money.</p>
<p>The best place is somewhere in middle, where customers can get the benefits of sharing their data and there are strong laws to make sure this data is not used negatively against them.</p>
<h3 id="my-answer-to-what-is-a-brain-drain-in-economicwhat-is-a-brain-drain-in-economics">My answer to “What is a brain drain in economicWhat is a brain drain in economics?”</h3>
<p><a href="">https://qr.ae/pGh3yY</a></p>
<p>Brain Drain phenomenon is the outcome of two other Economic Phenomenon</p>
<p><strong>Pareto Principle :</strong></p>
<p><a href=""><strong>https://en.wikipedia.org/wiki/Pareto_principle</strong></a></p>
<p>Basically the principle says that <em>vital few</em> create the most impact. Basically most [say 90%] disruption and positive change in a country is brought by the top 5%-10% achievers. And the rest contribute very little. This is a very well established principle and works in many fields including Economics, Business and other networks. If a country loses its “vital few”, it loses most of it progress. It then has to depend upon free trade and other countries for all the progress. You can technically say that the US has been pulling the world from 1945 [post war] - 2010s [pre China] as they had vital few of most countries moving in. It was only very recently that net immigration from China to US became negative and China has started becoming a parallel world power. Most Americans admit that immigration has benefited their country and made it the way it is today. The reason is that they were not welcoming random people [random Indians, Chinese or Bangladeshis], they were scrutinizing and taking the best. These would make America really really strong. So for example many large American companies are either founded or run by first or second generation immigrants, disproportionate to the ratio of immigrants in population.</p>
<p>IMO, a country’s progress will be driven by the vital few who choose to stay back and can make an impact in the much harder environment of their home country. Often this is hard because the elites of a less developed country are not the best and they avoid meritocracy to make sure they cannot be made to look like idiots. Another reason it can be hard to build in one’s own country is history of colonialism, poverty, war and dog-eat-dog mentality that arises as a result.</p>
<p><strong>Free Market Economics creating inequality :</strong></p>
<p>I have talked about this many times. I short term, free market creates lot of wealth and is possibly the best strategy. This is true in free high end labor markets. More developed countries have high end jobs that smart people of less developed countries can do sending some of this prosperity and progress back home.</p>
<p>However, you cannot just think forever in these terms as the vital few emigrating creates a void in the home country. Smart people emigrating leaves less smart people to manage the progress of less developed country {which is basically following the more developed country} creating a new “not so smart” elite class which as mentioned earlier will need to gatekeep making the brain drain a vicious cycle. Eventually the less developed country would become weaker as its smartest will have no option but to leave.</p>
<p>A very good representation is this talk [numbers have changed a bit in 1 decade, but the concept is intact] :</p>
<p><a href=""><strong>https://youtu.be/LPjzfGChGlE</strong></a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image59.png" alt="" /></p>
<h3 id="my-answer-to-do-you-have-any-unpopular-opinions-on-universal-basic-income">My answer to “Do you have any unpopular opinions on universal basic income?”</h3>
<p><a href="">https://qr.ae/pGIOVh</a></p>
<p>Subjective answer here. Not too many numbers to back things up.</p>
<p>I am in favor of some form of UBI only and only if there is a way to control what places the money earned from UBI can be spent in. UBI should be a negative feedback loop, that is the more people are dependent on UBI, the more are the chances that they should not need to depend upon UBI later.</p>
<p>That is only possible if they use UBI to 1. Make their bare necessities meet : food, healthcare, school bills and investing into their future : Building a business, taking a online vocational course, investing into another business or a good mutual fund. That is all ! There is no point UBI being spent to buy airpods or wine.</p>
<p>There are people who would believe that even increased spending through UBI money would boost the economy, but I don’t believe that. IMO, that would just cause short term increase in prices and inflation would eat up all the extra money UBI generated in economy, in the long term term a UBI consumerism culture would setup making sure people cannot reach a better social status despite UBI. So, we will thus have to keep paying UBI [possibly more and more] creating a ponzi scheme of sorts [UBI funding brands -> brands and middle class paying taxes to fund UBI -> UBI funding more brands -> more brands and middle class paying taxes to fund UBI -> .. after a certain level, middle class is no longer perceived as middle class due to the amount of things they are supposed to buy and posses and the pyramid collapses].</p>
<h3 id="my-answer-to-if-economic-growth-does-not-take-off-then-do-higher-taxes-and-financial-repression-lie-in-the-wait">My answer to “If economic growth does not take off, then do higher taxes and financial repression lie in the wait?”</h3>
<p><a href="">https://qr.ae/pGIHEa</a></p>
<p>My view based on the historical timelines I have observed is that some kind of ‘Return on civilization’s Investment’ is an eventuality for any nation state. [Not civilizations, civilizations run cycle of nation states].</p>
<p>So basically people of a civilization buy an idea of a nation state, narratives surrounding it, feeling of patriotism developes, the elite that propagate the idea of that nation state become leaders of people and people will stick to the idea expecting they will get something in return. A young nation state can fail [go into a civil war, regime change] if the idea of that nation state doesn’t sell well to people and they never really settled. An average sized nation state [around 50–100 years, this period varies for different civilizations] is possibly the strongest as the idea has sold well to people and they are willing to cooperate with elites and let a new social hierarchy develop hoping to find a place in it. At this stage, its the role of the elites to ensure they put nation on a path where the populace feels protected and taken care of. If not, there is a clear possibility of people getting some kind of regime-fatigue and civilization wanting to shift to a new type of nation state.</p>
<p>You can put any civilization’s history on this pattern and observe. Old civilizations like India, Japan, Turkey, Judeo-Christian, China all follow this rule. Dead civilizations like Mesopotamia and Egypt can be also studied with this trend in mind when they were around.</p>
<p>So how to avoid the nation state fatigue ? Elites need to make the nation state powerful and prosperous during their rise and then as they gather power, they need to make sure the rest of the country feels secure and cared for. A lot of it is perception but also welfare and opportunities count. If the elites stop trying to make themselves and nation more prosperous, they will lose the perception game. You cannot make too many mistakes when you are at the top.</p>
<p>You can find the earliest mention of welfare state in writings of Emperor Ashoka the Great :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image60.png" alt="" /></p>
<p>Where do you think the money for welfare projects comes from ? either natural resources or taxes. Ashoka, unlike what we learn, was not really the conquering king, the Indian nation state at that time had been compounding for centuries by his rule :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image61.gif" alt="" /></p>
<p>Ashoka was continuing his forefathers’ attempt at consolidating his kingdom by making people feel happy to stick around the nation state.</p>
<p>One of the reasons for downfall of Roman empire was that their ruling class and elites stretched too thin and stopped welfare activities :</p>
<p><a href="https://www.timemaps.com/encyclopedia/late-roman-empire/">https://www.timemaps.com/encyclopedia/late-roman-empire/</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image62.png" alt="" /></p>
<p>So I guess answering your question, some kind of “Civilizational Return of Investment” is an eventuality. Welfare State eventually needs to be triggered. Elites setting up a nation state need to plan to have a way to provide welfare services to people who have bought their ideas for 2-3 generations.</p>
<ul>
<li>
<p>One way is to develop a large enough middle class. This is the newest of the methods. A large enough middle class can bear taxes to support a welfare state. If you do not have a large enough middle class, either taxes will be high or not enough welfare will be available. This is precisely the reason why India changed so much during 1980s-90s.</p>
</li>
<li>
<p>The other is discovering and selling some unique resources for making enough money to support welfare state. Many oil economies run on this principle.</p>
</li>
<li>
<p>The third is allowing your citizens to make windfall gains. This is more psychological as not everyone gains but the gains are visible. In earlier days, this was by letting soldiers plunder after war or American “western expansion”. This now a days works by promoting entrepreneurship and allowing commoners into bureaucracy or ruling class.</p>
</li>
<li>
<p>Another way is infrastructure. Pyramids, Coliseums, Highways, airports, dams, server farms. These infrastructure investments not just enhance the economy, they also build emotion in citizens.</p>
</li>
</ul>
<p>Welfare state during feudalism was dependent on the ruling class, but with middle class based economics, its the middle class who are allowed to live in a smug space away from difficulties of the poor and tensions of the rich just for the purpose of keeping the nation state structure from collapsing. So yeah, if there is not enough growth and not enough people in middle class, the return expected per head would become very high. [High taxation is an eventuality in case of low growth rate <Pakistan> or unsustainable high growth rate <Thailand> ].</p>
<p><a href="">https://www.geo.tv/latest/344358-pakistan-tells-imf-it-will-either-add-more-taxes-next-year-or-increase-tax-rate</a></p>
<p><a href="">https://youtu.be/-KVM_PU6blI</a></p>
<h3 id="my-answer-to-what-is-the-simplest-example-of-nash-equilibrium-that-a-layman-can-understand">My answer to “What is the simplest example of Nash equilibrium that a layman can understand?”</h3>
<p><a href="">https://qr.ae/pGpZgO</a></p>
<p>I have been thinking about this for a few weeks and one very relevant story I could make about the current scenario is “<strong><em>Maintaining social distancing and wearing masks and having some sort of UBI during COVID 19 pandemic is Nash Equilibrium”</em></strong>.</p>
<p>Let me explain the concept a bit more :</p>
<ol>
<li>
<p>You can roughly divide human society into two parts : A. More senior people who have aggregated wealth and wisdom over years, but also are more vulnerable to the disease due to their health and responsibilities. B. Less senior people / youth for whom the disease is not too serious and they want their freedom to make money and fulfill their aspirations. Apart from this there are other small sections like C. vulnerable people from among the youth, D. people among seniors who don’t realize the risk COVID poses to them E. people who are more senior but yet not financially well off than younger generation and F. People who are young but still well off, but they are smaller cohorts.</p>
</li>
<li>
<p>So what really was the sensible thing for society to do using Nash Equilibrium ? i. Let the aspirations of B run wild and let A fend for themselves or ii. curtail B’s freedom somewhat to give more chances of survival to A while asking A to fund B’s UBI ? Latter is the more sensible option where both give up a bit to achieve a common goal. In some way, it shows a Nash Equilibrium between two adversarial interests. Society leaders took this decision which is ok for both and great for none.</p>
</li>
<li>
<p>Now for people who cannot look at big picture from set B, these regulations might come like needless restrictions to them. They can get well from the disease in a fortnight [and even if they dont, they dont really feel as much responsibility] and can carry on with their quest of wealth, joy or whatever. However, if the disease spreads faster, the cohort A would become afraid or sick or may not be able to recover, holding back their money and experience for short time or permanently. This would create a domino effect bringing back a bad economy and poor prospects for A in the long run.</p>
</li>
<li>
<p>For people who cannot look at big picture from set A, will complain about increased taxes and prices [money printer going brrrr…] :-D . They fail to understand that if they are halting progress for cohort B, they at least need to help them sustain. No UBI and extreme restrictions for B would backfire and social unrest which would come back to bite A in form of wealth loss/insecurity in future.</p>
</li>
<li>
<p>The best strategy is to thus cooperate and bear the burden of each other temporarily than risking a lot in future. See .. Nash Equilibrium, infact maybe some kind of prisoner’s dilemma.</p>
</li>
<li>
<p>There is of course justified concerns like money being printed is not just being used to support B but some greedy people from A as well. That’s a principal agent issue and needs to addressed by decentralization, but not having any help for B is as bad as no restrictions to protect A.</p>
</li>
</ol>
<h3 id="my-answer-to-what-are-the-dangers-of-unrestrained-consumerism">My answer to “What are the dangers of unrestrained consumerism?”</h3>
<p><a href="">https://qr.ae/pGIHET</a></p>
<p>Consumerism is good. Because it creates a bottom-up supply-demand equilibrium and helps prevent scarcity and hunger. In an ideal world, consumerism assumes rational consumers who would take purchase decisions according to marginal utility.</p>
<p>Other top-down supply-demand systems like communism and feudalism have in the past failed to prevent scarcity of food, medicine and other human needs. It just rectifies the fact that economy is too complex to manage from the top with a simple doctrine.</p>
<p>Too much consumerism has its problems though :</p>
<ol>
<li>
<p>Too much consumerism creates a network effect where consumerism grows much beyond meeting needs into becoming a social ritual. I have seen upper middle class people in India taking a loan to visit a country abroad on a holiday. That means in particular segments of society, holidays abroad appear so important for survival that people would put a collateral to achieve it. Ideal consumerism assumes rational decisions about ones’ needs, but using media and advertisements the marginal utility of a product/service can be greatly amplified.</p>
</li>
<li>
<p>Too much consumerism creates wrong incentives. In a recent survey in the US [possibly the most consumerist society on planet IMHO], the most popular career choices were : Youtube star, Musicians, Actors and the like. Why do you think these careers are more popular that nuclear physicist or software engineer despite similar money in both professions ? In order to make consumerism ingrained in society, you need “influencers” who can push narratives like ‘Its more important to travel 5 countries than having a secure future for your family’ and ‘responsibility is overrated’. Do you really see a scientist who has worked at least 20 years before he gets any recognition as an ideal candidate to tell this to society ? “I have worked 25 years towards this paper which help me get the Abel Prize, now I will reward myself with this great watch/car !” LOL. You need people who got overnight success [and some even who were handed over this success specifically so that they can push consumerism] and who can be shown as a YOLO icon. Then these influencers are shown to be “living a life” and are supposed to guide the rest of the society about how they should live. Good for selling products no doubt, but if a lot of the next generation of America wants to be an “influencer”, its not going to end well !</p>
</li>
</ol>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image63.png" alt="" /></p>
<p><a href="">https://www.thesun.co.uk/news/3617062/children-turn-backs-on-traditional-careers-in-favour-of-internet-fame-study-finds/</a></p>
<p>I am not bashing consumerism btw. As I said earlier, its much better to other alternatives like communism or feudalism where kids die without food. The right way is to put incentives in the system to self control bad effects of consumerism. The same people who make profits by pushing consumerism should also be afraid of making a loss when they push it too much changing society’s fundamental structure. As of now, rich Americans who profit by consumerism hardly have any incentive to worry about too much of it in American society. You could see similar traits in last days of Roman civilization too.</p>
<p><a href="">https://www.timemaps.com/encyclopedia/late-roman-empire/</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image64.png" alt="" /></p>
<p>Compare this to global warming. Even the people who make profits from global warming are concerned about it as they know they cannot just pump CO2 in atmosphere forever if they want to survive.</p>
<h3 id="my-answer-to-suppose-you-are-a-producer-what-combination-of-labor-and-capital-you-should-go-for-to-make-optimal-use-of-resources-how-will-you-identify-your-expansion-path-for-production-at-minimum-cost-with-2-factors-of-production-explain-using-diagram">My answer to “Suppose you are a producer. What combination of labor and capital you should go for to make optimal use of resources? How will you identify your expansion path for production at minimum cost with 2 factors of production? Explain using diagram.”</h3>
<p><a href="">https://qr.ae/pG73nq</a></p>
<p>If this could be explained with a diagram, everyone would be rich and successful by following an economics book. There cannot be any one formula for this, the economy is a complex system which cannot be quantified by deterministic algorithms and formulae.</p>
<p>The only way to have an optimal products company is to gather information about the market being addressed and try out multiple possible hacks and see what works. Another thing to understand is that being optimal is not always the best strategy when setting up and running a business. Minimizing potential risk is a better strategy and for that one needs to recognize risks and avoid them.</p>
<p>Expansion plans can be built after setting up the basic business and then seeing what possible opportunities for expansion exist.</p>
<h3 id="my-answer-to-are-some-economies-working-on-the-growth-rate-not-job-creationare-some-economies-working-on-the-growth-rate-not-job-creation">My answer to “Are some economies working on the growth rate, not job creation?Are some economies working on the growth rate, not job creation?”</h3>
<p><a href="">https://qr.ae/pG17YR</a></p>
<p>When a metric is the only aim of a system to achieve, the metric seizes to be of any practical importance. If you are running only after growth, its very high possibility that you get it, so is job creation. However, running only after growth or running only after job creation are both stupid risky policies in the long run. Economy needs both [without prioritizing one over the other] and need to run behind neither specifically. Policy making for a complex system like economics is not a simple algorithm like :</p>
<ol>
<li>
<p>Iterate over policies</p>
</li>
<li>
<p>If policy is good for a metric {job creation/growth} adopt it, otherwise meh !</p>
</li>
<li>
<p>Goto 1</p>
</li>
</ol>
<p>Its actually being right there, implementing policies, checking out its incentives and effects and crafting the next policy based on how economic system responds. Unlike what most of us want to believe, there is no one best silver bullet economic policy. Its trial and error. Economics is too complex to model and control from top, otherwise Soviet Union would have still been around and powerful.</p>
<h3 id="my-answer-to-how-feasible-is-the-buy-not-build-strategy-for-some-developing-countries">My answer to “How feasible is the “buy not build” strategy for some developing countries?”</h3>
<p><a href="">https://qr.ae/pG73rK</a></p>
<p>A blanket policy like “buy not build” or its reverse “build not buy” is of course going to end badly. Ideological purity around a philosophy like this which permanently barters something off is going to cause long term strengths and weaknesses in the country. Till the time the strengths are relevant, good enough, otherwise the weakness would come up and poof…. instability all around.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-30-Reflections-on-Econopolitics-About-isms-and-acys/media/image65.jpeg" alt="" /></p>
<p>The right strategy [all always] is being in center of extremes and taking common sense decisions based on one’s knowledge of the circumstance. Building what is strategic and possible and buy and transfer technology of that which is not possible is possibly the best way. Trying to keep local supply chain available and competitive with efficient global supply chains will hurt no one.</p>
<p>Unfortunately, the fact that a epistemic view of the world like “buy not build” is wrong and constant monitoring and policy change is required is hard to sell as :</p>
<p>1. Politicians cannot delegate issues after they become “out of fashion” and</p>
<p>2. Most Ideologues/supporters are happy to adopt a simple but wrong theory than complexities.</p>
<h3 id="why-are-why-are-monopolies-a-bad-ideawhy-are-monopolies-a-bad-idea">Why are “Why are monopolies a bad idea?Why are monopolies a bad idea?”</h3>
<p><a href="">https://qr.ae/pGXEJj</a></p>
<p>Monopoly ensures that there is <strong><em>extreme stability</em></strong> and thus no need of innovation. No innovation means the society is basically not able to have creative disruptions which advance society in big spurts keeping the society away from a social entropy induced decay. Too much stability is a slow poison as the internal inefficiencies consume the system.</p>
<p>How does Monopoly induce extreme stability :</p>
<ol>
<li>
<p>Extreme stability provided by Monopolies might be acceptable to some and unacceptable to others who have no way to change status quo. Monopolies thus produces very sharp critics.</p>
</li>
<li>
<p>Market forces become irrelevant. Basically demand will just grow with the natural growth. There is no effort to make market the pie bigger.</p>
</li>
<li>
<p>For consumers, point 1 means take it or leave it costly deals. This would create a lot of instability in society. One good thing with non-monopolies are that different companies can serve subsections of same market. Suppose the only option is to have a laptop is a 3000$ sleek and powerful computer. This would mak people who can afford 3000 $ computer much more powerful than ones who cannot. A 300$ computer doesn’t just provide alternatives to customers, but it keeps societies from crashing.</p>
</li>
<li>
<p>Competition forces quality improvement and affordability of products and more importantly scientific innovation to achieve goals mentioned here.</p>
</li>
</ol>
<h3 id="my-answer-to-are-there-any-countries-in-the-world-that-are-not-in-debt">My answer to “Are there any countries in the world that are not in debt?”</h3>
<p><a href="">https://qr.ae/pGXEWW</a></p>
<p>Being a country without debts is a very bad signal. Country debts are not like personal debts, because :</p>
<p>A. Country can print currencies, people cannot.</p>
<p>B. A lot of the debt is country’s people taking debt from their future to grow their country’s infrastructure at a faster rate than the debt rate. Populations of most countries and expectations of their people are generally growing, if they don’t have growth, how would they stay functional ? Its more like a business loan than a car loan for example.</p>
<p>A country without debts basically means one which is not aiming for growth [or one others think is not capable of growth].</p>
<p>A country having too much debt with respect to its GDP means its people are not growing the country fast enough and their culture has stopped being productive. It might also denote a bad economic situation like COVID recession.</p>
<p>On the tightrope between these two extremes, there is utopia !</p>
<h3 id="my-answer-to-how-much-truth-is-in-the-argument-that-some-banks-are-too-big-to-fail">My answer to “How much truth is in the argument that some banks are “too big to fail”?”</h3>
<p><a href="">https://qr.ae/pGXEZs</a></p>
<p>This argument is true. Banks are essentially in the business of trust. They deposit your money making you feel safe as if all your money is kept safe in a vault, while using your money for low/high speculation investment. They can only pull the liquidity trick {you can withdraw your money whenever unlike a mutual fund} because of people actually withdrawing less frequently due to widespread trust in banking system. Economy actually runs on much less money than it seems to actually have, a lot of this money we see is our trust in banking system.</p>
<p>Now if a big bank crashes, people can suddenly loose trust in economic system and want to pull out all their money as cash [which actually doesn’t exist]. The more people cannot withdraw, the more the trust in financial system falls and more people want their money as cash which again doesn’t exist. This is a clear systemic risk.</p>
<p>For smaller banks, people can just think of “yeah that was a small and unreliable bank” and a withdraw panic might not set in, but any large bank goes bust and all hell breaks loose.</p>
<h3 id="my-answer-to-is-it-possible-that-with-negative-interest-rates-banks-will-pay-you-to-have-a-mortgage">My answer to “Is it possible that with negative interest rates banks will pay you to have a mortgage?”</h3>
<p><a href="">https://qr.ae/pGXEb0</a></p>
<p>No.</p>
<p>If someone is getting paid to take a mortgage, the the business of banking is already done and you would have alternative financial institutions and not banks. The entire business of banks is to lend at a higher rate than they deposit money in to make a cut. If they give you money for taking cash out of their hand, the unit economics fails.</p>
<p>However, now that with zero [or negative] interest rates banks can give to depositors, the mortgage rates can be quite lower than earlier.</p>
<h3 id="my-answer-to-who-has-the-most-influence-over-a-countrys-development-politicians-or-business-tycoons">My answer to “Who has the most influence over a country’s development politicians or business tycoons?”</h3>
<p><a href="">https://qr.ae/pGXEwE</a></p>
<p>IMHO answer is :: Ones who can greatly influence Laws and Culture .</p>
<p>Culture is the morality society practices [the sense of what is wrong and right]. Laws are set of rules from the culture of dominant groups imposed to iron out cultural differences. Culture influences laws and laws influence culture, its a cycle of influences which evolve the society. In a few generations, society changes due to the interplay.</p>
<p>Both these things determine how individuals from a community and/or country will behave. How individuals behave will shape behavior of society as a whole. Note that the behavior of individuals is not how the society behaves as a whole. A society where individuals don’t believe in science for example doesn’t turn out to be a society of neanderthals [because they don’t live in isolation from other parallel societies] and there is no way to predict what it would evolve into.</p>
<p>Even the definition of development is shaped by culture. So your question must be what is development ? How do the country’s elites view development ?</p>
<p>For China, development is getting ts people out of poverty primarily and saving its sovereignty.</p>
<p>For post-1947 India, development has been ease of life and Social Justice based on whatever laws and common cultures have thought to be historical wrongs.</p>
<p>Politicians and Businessmen are just part of the country, all they are doing is riding the wave of existing culture and trying to reshape laws and people’s psyches to make their subculture dominant one.</p>
<p>Another set of more powerful people [whom you don’t mention in question] are intellectuals. Intellectuals is an ambiguous term at best as they are not people who earn by intellect but are actually influencers [news, media, advertisements, movies]. They are possibly more powerful than both politicians and industrialists as they tell stories which influences psyches directly modifying culture. They don’t need laws to influence culture. Indian psych which was opposed to foreign goods and private ownership pre1990s went crazy after McDonald’s and Rolex post1990s. Just half a decade was needed to change the culture of a nation of a billion. The only change in laws was allowing multinationals into India, the rest was all intellectuals changing narratives. <em>Story tellers are the most powerful.</em></p>My answer to “Doesn’t the free market provided by capitalism inherently discourage free and unbiased media (because free market supports greed)?”Thoughts On Non Ai Deeptech2020-10-10T00:00:00-05:002020-10-10T00:00:00-05:00https://muktabh.xyz/2020/10/10/Thoughts-On-Non-AI-DeepTech<ol>
<li>
<p>###</p>
<h3 id="my-answer-to-why-does-geneticscrispr-not-get-nearly-as-much-attention-as-aimachine-learning">My answer to “Why does genetics/CRISPR not get nearly as much attention as A.I./machine learning?”</h3>
</li>
</ol>
<p>Answered here originally : <a href="https://qr.ae/pN2hKY">https://qr.ae/pN2hKY</a></p>
<p>I am not sure that is the case. If you look at technologies to watch out for by any author worth considering, you will find a lot of them related to genetic engineering or CRISPR CAS. <a href="https://www.nature.com/articles/d41586-020-00114-4">Technologies to watch in 2020</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image1.png" alt="" /></p>
<p>I personally think Genetic Engineering is going to have much more if not equal impact than Artificial Intelligence on our lives. Also it is one of the fields where AI will be used a lot to simulate and predict due to insane amount of untapped data and possible downsides of wrong intuition. There is a revolution in genetic engineering waiting to happen just around the corner.</p>
<p>One of the best examples of genetic engineering applied is the first vaccine for COVID19 by Moderna is product using CRISPR. It is the first vaccine to clear phase 2 trials.</p>
<p><a href="https://geneticliteracyproject.org/2020/03/10/fighting-the-coronavirus-outbreak-with-genetic-sequencing-crispr-and-synthetic-biology/">https://geneticliteracyproject.org/2020/03/10/fighting-the-coronavirus-outbreak-with-genetic-sequencing-crispr-and-synthetic-biology/</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image2.png" alt="" /></p>
<p>However, there is no doubt that common people feel AI has entered their lives more as compared to Genetic Engineering. Why so ?</p>
<ol>
<li>
<p><strong>Commodity Hardware :</strong> To train an AI model, all you need is a commodity hardware (GPUs) and open data. The hardware and material to work on CRISPR for example is not available as a commodity that every startup round the corner can use. At least for sometime in future before the big names like Google convert AI into a game of scale, AI innovation is more commonplace and even a clever high school student with $2000 can innovate (However, we are slowly moving towards a scale based wall in AI hardware as well. The best known NLP model GPT3 by OpenAI, cannot be loaded into most commodity GPU/GPU clusters <a href="https://news.developer.nvidia.com/openai-presents-gpt-3-a-175-billion-parameters-language-model/">OpenAI Presents GPT-3, a 175 Billion Parameters Language Model</a>). I hope AI doesnt get into the same lab only trap like Genetic Engineering, but rather Genetic Engineering can become more based on commodity techniques for innovation to come up. Due to lack of commodity hardware and open innovation, Genetic Engineering is evolving thus like Nuclear Engineering or Material Science research, funded by large corporations in limited labs of large-ish universities.</p>
</li>
<li>
<p><strong>Regulatory Capture:</strong> Another very powerful driver in Genetic Engineering not being a household name is the insane amount of legal compliance and regulation barrier new innovation has to clear. Large corporations and governments want their hold on powerful tech. Nuclear Engineering, Genetic Engineering, a lot of pharmaceutical and healthcare is bound by too much regulation and standards so that a hold is maintained by these corporations on the huge sums of public money spent in these areas. Surprisingly, none of these areas effected by regulatory capture, despite being the pinnacle of science, has been able to make enough progress to better daily life of poor and the weak. It is very easy to show negative effects of a technology and gather public support for creating impossible standards innovators have to follow by paying some experts to tell people “X technology is going to harm you hence we need to ban it or only government can tell who will do it”. <em>Government’s work should to stop negative usage of technology and not act as gatekeepers to keep out innovation, it ends up doing latter.</em> Compare it to Lithium Ion battery, semiconductors and software industries where less regulation exists and all of these things have touched life of all 7 billion people in the world. No surprise some people are trying to put regulatory capture in AI/Lithium Technology as well to restrict new disruptors from entering. See discussions here: <a href="https://link.springer.com/chapter/10.1007/978-3-030-15651-0_4">Should Artificial Intelligence Be More Regulated?</a></p>
</li>
<li>
<p><strong>The Cathedral and the Bazaar:</strong> This might sound strange to people coming from outside, but rapid progress field of AI has been made due to assimilated effort of smart people working in different universities, companies and labs. There is competition to build the best and climb tallest on the shoulders of giants, but understanding that AI as a field needs to progress for good of everyone working. This has yielded free and open papers, free books, open source libraries and a welcome culture to innovators rather than patent based innovation <a href="https://en.wikipedia.org/wiki/Patent">https://en.wikipedia.org/wiki/Patent</a> in traditional research and making things complex to keep youngsters out : <a href="https://en.wikipedia.org/wiki/Gatekeeping_\(education\)">Gatekeeping (education) - Wikipedia</a> . Instead of intellectual property rights, the moats are Network Effect <a href="https://en.wikipedia.org/wiki/Network_effect">Network effect - Wikipedia</a> and Ecosystem Moat <a href="https://medium.com/boostcompanies-archive/business-ecosystem-creating-an-economic-moat-6c7064579dc9">Business Ecosystem: Creating an Economic Moat</a>. In terms of regulations, people can keep better eye on a emerging technology’s negative aspects in a connected world than a bureaucratic and prone to corruption (taking money from big old money to to gatekeeping for them) government watchdog. Linus Torvalds was the one who invented this trick in Linux .</p>
</li>
</ol>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image3.png" alt="" /></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image4.jpeg" alt="" /></p>
<p>TL,DR: Current structure of modern Internet is like a Bazaar, Genetic Engineering is like a cathedral. Cathedral only helps royalty and clergy, bazaar enhances living standards of common man.</p>
<h3 id="my-answer-to-what-makes-the-difference-between-blockchain-technology-and-information-technology">My answer to “What makes the difference between blockchain technology and information technology?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNHM25">https://qr.ae/pNHM25</a></p>
<p>I assume the question means what is the difference between “blockchain technology” and “traditional Information Technology”. Otherwise, the answer just needs to give definition of the two.</p>
<p>The difference between the two is who gets to say what is right. While in a traditional IT system all rules are made, verified and enforced by the service provider,in a blockchain, the process of verification is outsourced to an open group of multiple independent partied. All of these parties are combined guardians of rules that are being verified.</p>
<p>So for an example, when we use Quora, the rules for content are made, verified and enforced by Quora only according to the terms of service one agrees to while making an account. While making rules and enforcing them are pretty objective processes, verification of content for compliance can be quite person-dependent. If a unique person holds all the three powers (making rules, verifying rules and enforcing rules), they hold ultimate power to arbitrarily change the behavior of system by just changing perception on topics. A blockchain based moderation system will for example leave the verification task based on content rules to many different parties independently. Similarly in economics, if the same person (government) has the power to issue, print, verify(sign the notes as guarenter) and spend, they can do whatever they want changing value of others’ money a lot. QE (Quantitative Easing) is the process bitcoin was first conceptualized to prevent. Blockchain has different parties verifying transactions (most of them need to agree for a transaction) and no new money is printed ever.</p>
<p>This essentially brings a “decentralized” revolution. Blockchain is a special case of decentralized products and bitcoin is a special case of block chain.</p>
<h3 id="my-answer-to-what-technology-is-used-to-record-cryptocurrency-transactions">My answer to “What technology is used to record cryptocurrency transactions?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNMaeT">https://qr.ae/pNMaeT</a></p>
<p>Let’s understand in very basic terms what a cryptocurrency is :</p>
<ol>
<li>
<p>Whether one paid to another person or not is verified using the concepts of public and private keys. This is the same public key cryptography that we use to login into our Google or Quora account. Every transaction is signed using private key of the payer and can be verified by their public key. Its somewhat like you signing into your email account and sending an email to whole world that you are transferring X $ to ABC. The proof of this email was sent by you to make the transaction is stored till eternity.</p>
</li>
<li>
<p>However, just verifying a transaction is not enough to make a currency functional, the currency should also take care that the sequence of the transactions is mapped correctly too and can be verified quickly. It you are reading about these for the first time, you can basically think that the entire process of cryptocurrencies depend upon maintaining this order. One way to quickly intuit this is to think while a signed transaction of 10 cryptos from user 1 to user 2 is signed, if order is not maintained, the same signed transaction can be inserted again and again into the ledger to create fraud and extract out money from user 1. The data structure used to verify order is <a href="https://en.wikipedia.org/wiki/Merkle_tree">Merkle tree - Wikipedia</a></p>
</li>
</ol>
<!-- end list -->
<ol>
<li>. This makes sure that the order of all the previous transactions and the new transaction is mapped so that every transaction has a place in the history. As you can imagine current transaction cons’ed to all previous transaction would make a “chain” if done after every transaction. Instead of ordering each transaction , a group of transactions (block) is sequenced with respect to all previous ones to reduce computations. This Merkle Tree data structure is called a “Blockchain”.</li>
</ol>
<!-- end list -->
<ol>
<li>Now the third most important point is who gets to verify the order. Everyone can verify individual transactions using Public Key, but who gets to verify what is the right order in which these transactions were committed. The answer is “any miner on the network randomly”. Bitcoin Miners basically play roulette with each other trying to come up with some number combinations of Hash Values by adding random string to the latest block. If they win the roulette, they get a few cryptocurrency units and as long as these random miners keep competing to verify the transaction , a mathematical guarantee exists that the transaction data order is being verified correctly. If one of the miners tries to copy a few transaction in middle to make double payments to benefit them or friend, they will have to invent a mathematical system that helps them win the roulette of Cryptology Hash Functions again and again, which is impossible mathematically ! So someone who inserts a fraudulent duplicate transaction might be correct for one shot, but then the system will self correct when the next block is verified and the fraud will self remove.</li>
</ol>
<p>To answer your question specifically, the data is stored in a Merkle Block Chain Tree which is available to every miner on crypto network and anyone who wants to read and see it.</p>
<h3 id="my-answer-to-is-neuralink-really-the-technology-of-future">My answer to “Is Neuralink really the technology of future?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNFQ1r">https://qr.ae/pNFQ1r</a></p>
<p>I think its the next generation of devices after smartphones, iPads and wearables.</p>
<p>My detailed thoughts on the topic are in this answer : <a href="https://qr.ae/pNYfuY">Muktabh Mayank’s answer to What do you think about Elon Musk’s Neuralink and the future?</a></p>
<p>As Elon Musk himself says :</p>
<p>Definitely not. Smartwatches & phones are yesterday’s technology, Neuralinks are the future.</p>
<p>— Elon Musk (@elonmusk) <a href="https://twitter.com/elonmusk/status/1305570412349321216?ref_src=twsrc^tfw">September 14, 2020</a></p>
<h3 id="my-answer-to-what-do-you-think-about-elon-musks-neuralink-and-the-future">My answer to “What do you think about Elon Musk’s Neuralink and the future?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNYfuY">https://qr.ae/pNYfuY</a></p>
<p>I think Brain Computer interfaces are the next generation Computing platforms. They will augment with humanity in our pursuit to become more advanced both individually and as a civilization. Just like other Elon Musk startups, Neuralink looks a bot into the future. No one thought we would have privatized satellite network, commonplace electric cars and astronaut launches a few years back, and look at it now ! We will soon start having a chimera of magalev and vaccums in form of hyperloops .</p>
<p>While, you have seen Musk’s views about energy and transportation in his previous startups, Neuralink is him thinking of next generation of Computing. He always thinks that AGI might be a possible danger and this looks like his way to develop a Marcus Wright <a href="https://terminator.fandom.com/wiki/Marcus_Wright">Marcus Wright</a></p>
<p>if you will. Augmented Humans who can maybe use ASI algorithms (AI algorithms like what we have today) to become super-interstellar civilization than depending upon emergence of an AGI <a href="https://en.wikipedia.org/wiki/Artificial_general_intelligence">Artificial general intelligence - Wikipedia</a>.</p>
<p>Animal Brains in general and human brains in particular are the most efficient computing device we know of which run programs they learn by evolution and learning. If we can enhance these programs humans run in their brains with skills humans are generally considered poor at than machines, humans wont really need an AGI to reach the level of level 2 civilization. <a href="https://en.wikipedia.org/wiki/Kardashev_scale">Kardashev scale - Wikipedia</a></p>
<p>Let us see how computers have started becoming parts of Human day-to-day life for last few decades :</p>
<p>pre 1980s : Large Computers in institutions like government where they helped in important scientific calculations like say in Nuclear Physics or Aerospace Engineering. Devices used were generally large Mainframe like structures.. <a href="https://en.wikipedia.org/wiki/Mainframe_computer">Mainframe computer - Wikipedia</a></p>
<p>1980s-2000 : Thanks to Moore’s Law, <a href="https://www.investopedia.com/terms/m/mooreslaw.asp">Moore’s Law Explained</a></p>
<p>computers started to impact everyday life more , started to be used at retail banks, airlines, public utilities and other institutions people visited frequently in real life. Devices used were evolution of mini computers like PCs and laptops. <a href="https://en.wikipedia.org/wiki/Minicomputer">Minicomputer - Wikipedia</a></p>
<p>2000–2020 : Computing has become much more ubiquitous through mobile phone and people use their devices as banks, post office, shops, cinemas and even society is now virtual (social networks). <a href="https://en.wikipedia.org/wiki/Mobile_computing">Mobile computing - Wikipedia</a></p>
<p>As you can see from mini-frames to mobiles, the Human Computer Interface is becoming more efficient, easy to carry and “personal”.</p>
<p>The next HCI will not just ease the day to day pursuits of a person, but also enhances their mental and physical activities. Elon Musk in Neuralink is trying to build a platform just like Steve Jobs did in iPhone and Google built in Android. There would be a potential app ecosystem just like we have in phones.</p>
<h3 id="my-answer-to-can-elon-musks-neuralink-pave-way-for-ai-to-take-over-humanity">My answer to “Can Elon Musk’s Neuralink pave way for AI to take over humanity?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pN59So">https://qr.ae/pN59So</a></p>
<p>I dont think that is the aim, Neuralink from what I understand aims to augment the human brain so that they can be given massive storage and extra processing speed. This would keep human brain competitive with AI technologies.</p>
<p><a href="https://www.theverge.com/2017/3/27/15077864/elon-musk-neuralink-brain-computer-interface-ai-cyborgs">Elon Musk launches Neuralink, a venture to merge the human brain with AI</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image5.png" alt="" /></p>
<h3 id="my-answer-to-why-do-people-call-tesla-as-a-startup-bubble">My answer to “Why do people call Tesla as a startup bubble?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNicDP"><span class="underline">https://qr.ae/pNicDP</span></a></p>
<p>I don’t think Tesla is a bubble.</p>
<p>Its producing good cars, which are going to get more performant and cheaper over time, is led by probably one of the best leaders on Earth and is driven by a very consistent vision.</p>
<p>I don’t think “people”, as of today, think its a bubble as well, otherwise they would not be investing like crazy in Tesla. I mean there are always bears, but look at that stock :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image6.png" alt="" /></p>
<p>In principle, most people in the world (except those who make money by selling oil) kind of agree that we have to switch from Petroleum eventually if we want to have infinite cheap energy. All Petrol in Earth has less power than the amount of energy Sun emits in maybe a day. Similarly a gram of Thorium can produce more energy than many liters of oil. In order to become more energy efficient, we need to move from Petrol to other sources of energy just like we moved from firewood to coal and then coal to petrol as primary retail fuel of humanity.</p>
<p>Of course, there is a decent chance than such a move would reduce Global Warming as well (if at all warming is reversible at all). So that would be a bonus too ! No one likes having bigger cyclones every year.</p>
<p>Tesla is different from other manufacturers. Tesla is evolving into an Energy company, so its basically a Cars + Energy Harnessing Company. So its the Ford+Exxon for Solar energy, both huuge companies in Petrol, and maybe a few more like <a href="https://en.wikipedia.org/wiki/Southern_Company"><span class="underline">Southern Company - Wikipedia</span></a></p>
<p>included (if its scales to what it pitches right now). Solar power is more efficient than Petrol and let’s Tesla play all the parts in the Energy Supply chain.</p>
<p><a href="https://www.tesla.com/en_AU/powerwall"><span class="underline">Powerwall | Tesla</span></a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image7.png" alt="" /></p>
<p>Tesla probably will slowly move into more sectors where it can push Solar Energy too. Basically Amazon:Shopping::Tesla:Solar Energy . They are playing a platform game.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image8.png" alt="" /></p>
<p>Here is the mission of Tesla : <a href="https://www.tesla.com/blog/mission-tesla"><span class="underline">The Mission of Tesla</span></a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image9.png" alt="" /></p>
<p>Transportation is the major consumer of Petroleum and this is the right first sector to disrupt if we want to move to an alternative form of energy :</p>
<p><a href="https://www.globalpetrolprices.com/articles/39/"><span class="underline">Breakdown of oil consumption by sector | GlobalPetrolPrices.com</span></a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image10.png" alt="" /></p>
<p>Tesla will IMHO bring solar to transportation first and then push into more and more sectors. So basically you can think of a Tesla stock surge as humanity’s bet towards becoming a higher order civilization : <a href="https://en.wikipedia.org/wiki/Kardashev_scale"><span class="underline">Kardashev scale - Wikipedia</span></a></p>
<p>It’s not just Tesla, people are willing to bet on more ambitious ideas : <a href="https://www.intelligent-energy.com/news-and-events/company-news/2019/09/18/zeroavia-announces-27m-uk-government-grant-for-the-development-of-zero-emission-aviation/"><span class="underline">ZeroAvia Announces £2.7m UK Government Grant for the Development of Zero Emission Aviation</span></a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image11.png" alt="" /></p>
<p><a href="https://www.msn.com/en-us/money/companies/nuclear-fusion-startup-gets-84-million-to-enter-next-phase/ar-BB14zPWJ"><span class="underline">Nuclear Fusion Startup Gets $84 Million to Enter Next Phase</span></a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image12.png" alt="" /></p>
<p>And even more controversial ones :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image13.jpeg" alt="" /></p>
<p><a href="https://hindenburgresearch.com/nikola/"><span class="underline">Nikola: How to Parlay An Ocean of Lies Into a Partnership With the Largest Auto OEM in America</span></a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image14.jpeg" alt="" /></p>
<p><a href="https://nypost.com/2020/09/29/nikola-founder-trevor-milton-accused-of-sexual-assault/"><span class="underline">Two women accuse Nikola founder Trevor Milton of sexual assault</span></a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-10-10-Thoughts-On-Non-AI-DeepTech/media/image15.jpeg" alt="" /></p>
<p><strong>TL,DR :</strong> I think humanity has already bought into the vision of moving towards more infinite/cheap and less CO2 emitting energy. Every company who can pull of this vision well will do well. Tesla is just building a Solar Energy platform, you will have equivalent Hydrogen and Fission/Fusion platforms in the future too.</p>### My answer to “Why does genetics/CRISPR not get nearly as much attention as A.I./machine learning?”Advice To Youngsters Who Are Starting Engineering Education Now And Aspire For A Career In Data Science Ai Or Entrepreneurship2020-09-30T00:00:00-05:002020-09-30T00:00:00-05:00https://muktabh.xyz/2020/09/30/Advice-to-youngsters-who-are-starting-engineering-education-now-and-Aspire-for-a-career-in-Data-Science-AI-or-Entrepreneurship<p>Collecting my answers from Quora, where I advice young students getting into engineering now and aspiring to build a career in Data Science, AI or Programming.</p>
<h3 id="q-my-brother-is-confused-which-branch-he-should-opt-for-between-ai-and-computer-science-as-in-upcoming-times-ai-has-a-very-large-scope-can-anybody-suggest-me">Q. My brother is confused which branch he should opt for between AI and computer science. As in upcoming times AI has a very large scope. Can anybody suggest me?</h3>
<p>Originally answered here: https://qr.ae/pN2Q5y</p>
<p>There is a branch called Artificial Intelligence already in some Indian college ? That is a bit too early. Some opinions from me :</p>
<p>Opinion 1 : As of 2020, I personally feel that AI is not a field broad enough for a 4 year graduate course in Indian context, a BTech in Data Science in India is still conceivable. A Computer Science degree with Machine Learning, Deep Learning and good calculus and statistics courses should be enough to enter into the field of AI and I am almost sure this will not change in 4 years. Unless you are looking at an undergraduate research degree, I dont think a bachelor’s degree in AI will be worth it. In fact, a lot of the field of AI is just actually traditional Computer Science, Statistics and Optimization (All 3 fields were covered in my undergrad degree at BITS Pilani). The only new things are Deep/Machine Learning algorithms which can be taught in 2–3 electives.</p>
<p>Opinion 2 : Even if some university comes up with a clever course structure around BTech in AI say (I think there is a possible course structure choosing subjects from Computer Science and Maths and Machine Learning specific courses), I dont think any university in India has enough faculty talent pool to teach modern AI well apart from a few top ones. Its hard for large companies and top universities to find top AI talent, how would a general university afford it. Heck, most universities dont teach even Computer Science well. So many CS grads in India and many job vacancies never get filled.</p>
<p>Opinion 3: If you are really interested in AI, according to me a good path will be to pursue Computer Science from a college with good A. Coding campus culture and B. CS faculty in AI. Some good ones in India are : IIT(M/Kgp/B), IIITH, other good IITs, BITS and a few NITs. If you are not able to secure entry into these colleges try completing <a href="http://deeplearning.ai/">http://deeplearning.ai</a></p>
<p>courses or do an online minor like <a href="https://onlinedegree.iitm.ac.in/">IIT Madras Online Degree Program</a>.</p>
<p>Just getting a degree in AI from a random institute where practical knowledge is rare will be of no use.</p>
<h3 id="q-excuse-mei-am-going-to-join-engineering-this-year-what-is-the-basic-i-should-start-with-i-am-going-to-join-computer-science-and-engineering-with-specialization-in-artificial-intelligence-and-machine-learningwhat-should-i-learn-start-my-journey">Q. 🙏EXCUSE ME.I am Going to Join Engineering This Year What is The Basic I should Start With. I am Going to join Computer science and engineering with specialization in artificial intelligence and Machine Learning.what should I learn start my Journey?</h3>
<p>Originally answered here: https://www.quora.com/EXCUSE-ME-I-am-Going-to-Join-Engineering-This-Year-What-is-The-Basic-I-should-Start-With-I-am-Going-to-join-Computer-science-and-engineering-with-specialization-in-artificial-intelligence-and-Machine-Learning-what/answer/Muktabh-Mayank</p>
<p>Recommendations from me here are are subjective, some people might not agree with what I say. Hope other people share their ideas with you as well so that you get a varied perspective.</p>
<p>Some more general advice before you start your courses (not related to Machine Learning coursework) :</p>
<ol>
<li>
<p>Most people who join CSE willingly do so because they want to build a website, build a game, build a cool AI algorithm or build a software they always wondered about. Some join because they want to earn a lot ! A Computer Science degree teaches you not just how to build these things, but also the principles behind the building process. Remember you are getting in not just to learn what you always wanted to build, but also build it effectively in a technically sound way. Your aim should be to focus on both these goals : Learning to build using computers and learning the right way to build using Computers. They are slightly different skills, like cycling and learning about center of gravity and equilibrium in Physics, but the smartest people I find are those who know both how to write software and write it effectively. I will break it down more in upcoming points.</p>
</li>
<li>
<p>Studying to learn and studying for marks can be two different things sometimes and the same thing many other times. Learn to recognize this. Dont neglect your marks totally. A few days of studies before the exams manages grades well generally. However, more importantly, dont study just for exams. Remember if you dont come out of your university as a good (or an average) Data Scientist in your own perception, you would have wasted a lot of time and money even if you would have gotten good marks. On the other hand, if you come out as a good Data Scientist in just your perception with poor marks, the world will not be willing to bet on you. Lagom.</p>
</li>
<li>
<p>Remember most teachers you will find on the way will be average or below average. Your aim should be to become better than most if not all of them. There would be many times when they will not be able to help you intuit about something well. Its your responsibility to use the vast amount of resources available to make yourself good at the courses you take. In computer science, you have this unique advantage of learning from anywhere. Don’t just depend upon your teachers for your understanding.</p>
</li>
<li>
<p>Do practical things. Push yourself as much as possible to do practical projects with researchers/developers, even for no or little compensation or recognition. There are ways in Indian colleges to avoid practical work in courseware by doing “jugaad”. My biggest regret from my college days was not doing more practice. Again, do as many projects and as much programming as possible. In retrospective, the best way is to do jugaad in exams/labs so that you can score the maximum but do practice in your free time where you focus on quality and learning.</p>
</li>
<li>
<p>Remember that credentials like marks and university brand value is just a good launchpad, your skills will take you ahead from there. Dont fret too much about marks if you think you are good at practice. Learn to build. Just don’t neglect exams and marks altogether as I said earlier.</p>
</li>
</ol>
<p>Ok. Enough of boring meta lecture. Let me tell more about academics :</p>
<ol>
<li>
<p>Learn Python very well (and R too). They are easy and can be learnt online for free at many places. You need to be fluid in Python just like you are in one of the languages you speak. Programming is taught in most CSE curriculum but the aim is often to ensure a minimum standard than making you fluent at it. You need to take charge and make sure you are fluent.</p>
</li>
<li>
<p>Keep a track of 3 courses being taught to you very well. These courses are Statistics, Linear Algebra and Optimization. As a Data Scientist, these are the three courses you use the most at job after programming. Many tutorials/courses available for free. Here is a list of 50+ free books which might be useful for self-learning these topics: https://blog.paralleldots.com/data-science/50-must-read-free-books-for-every-data-science-enthusiast/</p>
</li>
<li>
<p>Remember your differentiator as a Computer Science first Data Scientist is going to be programming. Keep good command on Data Structures and Algorithms courses and Databases/Data Processing.</p>
</li>
<li>
<p>When you now about the basic somewhat, try doing courses like the ones listed on <a href="https://www.fast.ai/">fast.ai · Making neural nets uncool again</a> , <a href="http://Deeplearning.ai/">http://Deeplearning.ai</a> and Data Analysis specializations on various platforms like Coursera/Edx. Please remember, doing the courses is more important, buying certificate is optional. Do assignments, not just theory.</p>
</li>
<li>
<p>Subscribe to a few newsletters to make sure what is going on in real world of Data Science when you are in college. State pf the art research and new tools.</p>
<ol>
<li>
<h3 id="q-how-important-are-good-colleges-iits--all-in-forming-an-entrepreneur-and-how-does-it-differ-from-a-dropout-in-india">Q. How important are good colleges (IITs & all) in forming an entrepreneur and how does it differ from a dropout in India?</h3>
</li>
</ol>
</li>
</ol>
<p>Originally Answered here: <a href="https://www.quora.com/How-much-importance-do-good-colleges-IITs-all-play-in-forming-an-entrepreneur-and-how-does-it-differ-from-a-dropout-in-India/answer/Muktabh-Mayank">https://www.quora.com/How-much-importance-do-good-colleges-IITs-all-play-in-forming-an-entrepreneur-and-how-does-it-differ-from-a-dropout-in-India/answer/Muktabh-Mayank</a></p>
<p>Good Question.</p>
<p>There are 3 things I consider very important to be a successful entrepreneur :</p>
<ol>
<li>
<p><strong>Basic Intelligence :</strong> “All smart people don’t goto IITs/NITs” and “Not every IIT/NIT student is smart”, but you will agree that many of them have above average intelligence. Certain amount of intelligence is needed to be an entrepreneur and many good colleges will have kids like that.</p>
</li>
<li>
<p><strong>Awareness/Environment/Compounding :</strong> This is the most important, but really underrated property. Good colleges are a gathering of high percentage smart people who are connected to other smart people and know about what is going on in the world. The environment and conditioning in 4 years can change people’s world views a lot and make them look at world in a way that helps them churn out successful technology businesses. This is not unique to IITs say, Stanford, Cambridge <a href="https://en.wikipedia.org/wiki/Cambridge,_Massachusetts">Cambridge, Massachusetts – Wikipedia</a> and OxBridge etc have demonstrated this too. You can also see this in other spheres of life as many successful businessmen come out of successful business families and many brave army officers come out of army families and many civil servants come from civil servant families. Environment and conditioning compound over time and give a distinct advantage. I think this is the major contributions top colleges bring to ones life, awareness and network.</p>
</li>
<li>
<p><strong>Risk Appetite :</strong> Any successful entrepreneur is one who takes many risks. Risks which have extremely high payouts (in Billions of dollars) and relatively less loss (say 2 year in career growth). When one takes 10 such risks, they have probability of getting success is OK, when one takes 1 such risk, their probability of success is close to zero. Although it might sound unfair, but it is about trying to get lucky while losing out less for every trial. IITians and people from top college know that the payout on success is huge, while on failing their degree/credential will give them some kind of a social security by getting them a decent job. For someone without a credential, its just way harder making their risk appetite less. Introduce some kind of achievement based social security for entrepreneurs and see the number of startups from non-elite colleges soar.</p>
</li>
</ol>
<p>Cannot say about dropouts, you don’t have too many dropouts in India ! Peter Thiel asks people to dropout and work on their business and when you look at his fellows, that doesn’t look entirely wrong. <a href="https://en.wikipedia.org/wiki/Thiel_Fellowship">Thiel Fellowship - Wikipedia</a></p>
<p>That said, society in India recognizes credentials much more (probably because we were rules by British in past) and the factor 2 above will not be fully possible for a dropout. That said, one can build awareness and network without going to a top college too, its not impossible, they just need to know what to do and stay committed.</p>
<h3 id="q-is-computer-science-cs-overrated-in-india-every-other-engineering-students-wants-to-take-cs-in-any-college-whether-he-has-interest-in-it-or-not">Q. Is Computer Science (CS) overrated in India? Every other engineering students wants to take CS in any college whether he has interest in it or not.</h3>
<p>Originally Answered here: <a href="https://www.quora.com/Is-Computer-Science-CS-overrated-in-India-Every-other-engineering-students-wants-to-take-CS-in-any-college-whether-he-has-interest-in-it-or-not/answer/Muktabh-Mayank">https://www.quora.com/Is-Computer-Science-CS-overrated-in-India-Every-other-engineering-students-wants-to-take-CS-in-any-college-whether-he-has-interest-in-it-or-not/answer/Muktabh-Mayank</a></p>
<p>As bad it feels while saying this, CSE is actually NOT overrated in India. CS has both a supply side and demand side advantage in India thus creating opportunities that are just not possible for other streams. Let me try to explain my point :</p>
<ol>
<li>
<p>Most (not all) Indian educational institutes were opened after India allowed foreign firms to enter India. These firms were either opening sweatshops in India or opened factories in India so that they could sell to Indian market. As you can imagine, not a lot of innovation is required for both such jobs as all they need is cheap resources and people managers with domain knowledge. This shaped the Indian education system to create Engineering Schools which handed out degrees to average engineers for cheap. Government, Businessmen and People they all wanted cheap accessible degrees, why spend a lot on Engineering education when everyone gets a 2.4–3 Lakh Rupees per year job, wherever they study from. One wont spend 50 Lakhs to get a degree that pays 3 Lakhs/Year. To be clear, I am not complaining, this was a good move given pre-1990 salaries in country. People did not mind doing low quality work if it paid relatively better. Only some T-schools subsidized by government could continued focusing on high quality during this time. Students from these institutes had to run to US or EU for a job as they just couldn’t compete salarywise to others. Most Indian colleges have BAD faculty, not even average. We have better high school teachers in our nation than Engineering lecturers in many cases, because to push cheap degrees, we cannot pay good money to people teaching engineering. When all you need is an Engineering degree to get a low wage job with high certainty, this is what would emerge. Unlike other branches of engineering, where you need great investment to setup labs and research facilities, CSE education can effectively be completed on a single laptop. Most universities and experts around the world are also more open in CSE to share their knowldge through the internet, very less secret and proprietary research. High quality CSE study material is available for free or cheap on internet for minimal investment and someone who doesn’t want to be just an average Engineer and wants to actually know and build in detail has an option to do so. People in colleges with good infrastructure (IITs/BITS) could take advantage of this arbitrage before it was commonplace. Almost everyone in our batch (2008–12) had done Ars Digita University <a href="https://en.wikipedia.org/wiki/ArsDigita_University">ArsDigita University – Wikipedia</a> courses during our engineering years. So unlike no other branches of Engineering, in CSE, people can spend quite less money to get a degree and still become very good Engineers if they know where to find the right information. You have coursera, edx, udacity, udemy and many free courses on youtube teaching CSE for free/cheap. This is a unique advantage for CSE students. While you still get a degree from a system that is designed to make you average, but still, you can be really good. This creates an arbitrage where your salary requirement would be lesser than the top engineers who invest a lot of money for quality education. Supply of high quality cheap Engineers brought in many many jobs opportunities into India. Unlike the sweatshop work of yonder years, this was well paying work. If there is a reason why CSE is so coveted, it is this set of jobs.</p>
</li>
<li>
<p>This created a cycle, India’s top software talent then went ahead founding more software based companies/startups whose high caliber, high skill work in done in India as well. This created more high paying positions and talented individuals which forced more foreign firms to bring high caliber more jobs into India to stay competitive. A self-enforcing cycle. Basically, Indian software power is like a black hole, keeps sucking in jobs and thus creating better outcomes for students. In last 10–15 years, the entire scenario has changed for the better in a way no one could imagine.</p>
</li>
<li>
<p>Most other industries in India mostly took safe bets. Put up a car assembly line, Build a road and things like that. Indian Engineering jobs in these sectors have been domain-informed people-management mostly. All innovation was mostly done in US or Germany or (now) China. There was no loop of Skill-Jobs supply-demand set up. Reason being there is no way to get cheap education in say Mechanical Engineering or Electrical Engineering without compromising in quality to self-motivated people. With India now moving towards a self fulfilling manufacturing base, we will probably start moving towards this, but the progress will be slower.</p>
</li>
</ol>
<p>So to answer your question, CSE is actually a good bet for people who have no idea about what they are interested in. Most kids actually dont know what they will want to do at the age of 17–18 years as our education system before that keeps us away from decision-making and vocation. Maybe that would improve in the future too. For such people, it is actually a good bet to take CSE. If they put in some effort apart from what is taught in the class, their learning has no restrictions and they might make it big.</p>
<p>However, for someone who understands how they will chart a course as a Mechanical Engineer say, it is stupid to push them into pursuing CSE. One of my first year wingmates took Mechanical Engineering at BITS by choice (ie could have gotten a Information Systems degree like me which had a lower cutoff or even Electronics as he had scored high) knew exactly what he wanted to do in Mechanical Engineering and ended up creating one of the biggest robotics companies India had ever seen. Smart people will almost always find their way !</p>
<h3 id="q-my-relatives-are-pressuring-me-to-do-graduation-and-i-want-to-learn-coding-because-i-think-the-value-of-graduation-is-now-gone-after-the-new-education-system-policy-what-should-i-do">Q. My relatives are pressuring me to do graduation and I want to learn coding because I think the value of graduation is now gone after the new education system policy. What should I do?</h3>
<p>Originally Answered Here: https://www.quora.com/My-relatives-are-pressuring-me-to-do-graduation-and-I-want-to-learn-coding-because-I-think-the-value-of-graduation-is-now-gone-after-the-new-education-system-policy-What-should-I-do/answer/Muktabh-Mayank</p>
<p>Relatives are pushing you to get a degree than do self study due to three things :</p>
<ol>
<li>
<p>Coming from our British colonial past and then post-independence socialism and then IT services based economy, credentials of a person (like degrees, certificates) have been used as a filter have been used to filter people for jobs (marriages too in some parts of India from what I hear, “cannot marry my kid unless you are an IITian”). So when your relatives were students, a good degree was must to get anywhere. Indians were mostly doing petty stuff for most of this time, aircraft maintenance than aircraft building, updating BI tools rather than creating BI tools and implementing an MNC’s policy in India rather than making policies. The problem with such relatively-lower-skill jobs is you just need “good enough” people for them and thus can use any arbitrary filters to screen them. Degrees, thus were very important to tell how “eligible” one is. When I was writing JEE and BITSAT in 2007–08, not getting into a good college basically meant very very reduced exposure and brownie points, there was no match between the outcomes of an elite degree and non-elite one! Even now, there is still some difference in outcome, if a person has no differentiator other than college degree. This has started changing only very recently as Indians have started building original products and companies, which is harder to achieve and thus they need people who are really good and passionate about their work. Hiring someone from IIT who cannot get my app grow really fast by digital marketing is not going to help me as a founder, I would rather hire someone who is really good at digital marketing from whatever college. Due to the competition, Indian elite colleges are still much more likely to produce many super-intelligent and hardworking people than average colleges, but yeah, IIT/BITSians only type job postings are slowly declining. So by this criterion, I guess there is no disadvantage in not wasting money on a university degree. At least for programming and Computer Science, free and high-quality education is available online which you can get to become a great programmer without any CS degree. If you are going to start a company or going to work for startups for most of your time and are committed to keeping your skills top notch by self learning, graduation degree actually is redundant. But be assured that institutions that run on credentials: Banks, Service companies, formal education, government and others, are almost never going to hire you, unless there is a radical change.</p>
</li>
<li>
<p>That said, the field of academia is still very credential based. It is not uncommon to hear someone to get rejected from a MS(Data Science) program because their Bachelors was in Electronics. Think of it, there should be no big deal about an electronics graduate willing to pursue Data Science, but academia as a field runs by credentials and sometimes even this gets stuck. No wonder, academia is the system of credential building and the whole castle will fall if they start making exceptions. So if you are avoiding graduation, you can be assured that you cannot go back to a college or university at skill level you really are at after all the self learning. You will have to start with bachelors whenever you decide to go back to school, even if you might have published a paper in Nature. Chris Olah, who is an AI researcher at OpenAI (and flunked graduation when he heard and read Peter Thiel) writes in detail about it here : <a href="https://colah.github.io/posts/2020-05-University/">Do I Need to Go to University?</a> He used to be active on Quora too !</p>
</li>
<li>
<p>One important thing you need to know about universities, they may be suboptimal institutions at undergraduate level, but they are really good at one thing, ensuring a minimum standard when a student is given a degree. Everyone getting a degree is not really great at their job, but you know that they will have some bare essential qualification if they have taken exams and completed formalities. If you decide to stay outside this framework and take responsibility and are driven to self-educate overcoming procrastination and comfort-zone, it is really good. However, you have no safety net, there is no guarantee that you are not totally wasting your time away. You will have to be very proactive to make sure you are actually making progress and are not getting stuck.</p>
</li>
</ol>
<p>Net net, ditching gradation was unthinkable maybe even 5 years back, but for programmers, it is a feasible decision now. However, it has many implications which one needs to understand before they take the call. Its a “package deal” all the independence and super efficient learning combined with the risk of procrastination, staying no to credential based system. Make your choice well, Hope this helps !</p>
<h3 id="q-will-it-be-worth-it-to-invest-25-30-lakhs-for-a-btech-in-bits-pilani-after-covid-19-if-roi-decreases-as-jobs-will-be-affected">Q. Will it be worth it to invest 25-30 lakhs for a BTech in BITS Pilani after COVID 19 if ROI decreases as jobs will be affected?</h3>
<p>Originally Answered Here: <a href="https://www.quora.com/Will-it-be-worth-it-to-invest-25-30-lakhs-for-a-BTech-in-BITS-Pilani-after-COVID-19-if-ROI-decreases-as-jobs-will-be-affected/answer/Muktabh-Mayank">https://www.quora.com/Will-it-be-worth-it-to-invest-25-30-lakhs-for-a-BTech-in-BITS-Pilani-after-COVID-19-if-ROI-decreases-as-jobs-will-be-affected/answer/Muktabh-Mayank</a></p>
<p>We don’t know how the job market will look after 4 years (understanding that you are entering Engineering now). From what we have seen in history, after a economic crisis (like the ongoing year where jobs are extremely hard to come by), there is a economic boom. Unless the policy is really bad (or socialist which doesn’t allow private sector), an economic slump weeds out bad (sometime good) competitors and when the market gets some confidence back, the survivors experience a massive surge. Also people who lose jobs develop new expertise and come back with new innovative ideas in the booming market where the survivors are making money to make more money themselves. During an economic crisis is the best time to get educated and prepare for a future career.</p>
<p>For example, during my early years at BITS, the 2008–09 crisis had made things really bad. My seniors had to take jobs with companies who were not allowed in campus a few years back because they paid really less or had employment terms not aligned with college’s policy. But that was a bad time to enter workforce. However, by the time I graduated in 2012, the job market was in full swing and people were getting placed in top MNCs with salaries 2008-09 graduates could only dream of. The MNC craze got done around 2015–16 with Indian startups becoming the highest payers until this pandemic disruption. The pandemic disruption will change industry and economy for long term, but unless something goes really wrong, I think 2–3 years down the road, we should experience another economic boom.</p>
<p>Most people dont think in terms of RoI and treat education as a cost to build long term employment out of it. So take a loan, complete a degree, work your way up the ladder, pay the loan back, do a masters, start a family… you know the general rule. If you are planning this type of a trajectory, I think its a good bet to get into college and start a degree right now and hope economy to bounce back in a few years.</p>
<p>If you want a quick RoI on the 25 Lakhs, well that is a lot of money to get time bound RoI on. During our batch, you could typically earn back all money you spent on college degree in a year or two. Even lesser if you had an MCN. However, it seems that wont be the case now. In a positive way, that can be a good incentive for people to work really hard and develop as much expertise as possible during their stay in college, because that degree is really you burning a lot of money. People 10 years back had optionality, people now dont have that, great things are achieved when you dont have optionality.</p>
<p>Also probably incoming college students need to think more about long term perspective before they choose what they study. For example, A lot of my batchmates just took a loan for a US college degree just after they passed out and had to think of the RoI only while planning for their masters degrees, I dont think new people will have that liberty given 25 Lakh already needs borrowing money at graduate level. At least one or two paths to follow after they graduate should be clear to them from start. You can only get a sure-shot high RoI if you plan a way to get RoI, dont just invest and hope the dice turns a SIX.</p>
<p>This might be expecting a bit too much maturity out of the young people entering colleges and I am sorry about that. We are not expected to make any decisions in our first 12–14 years of education and it will be huge change to take a decision keeping 4 years in perspective. That you are asking a question about RoI at such a young age is already impressive. Hope you have a good BITSAT score :) .</p>
<h3 id="q-are-there-any-indian-startups-who-can-accept-a-fresher-for-an-internship">Q. Are there any Indian startups who can accept a fresher for an internship?</h3>
<p>Originally answered here : <a href="https://qr.ae/pNz7qA">https://qr.ae/pNz7qA</a></p>
<p>“Startups” is a very broad set of companies. From decacorns like Ola to your neighborhood garage startups, its a very wide spectrum of companies. Here is how I think one should look for jobs/internships in Indian startups depending upon what one’s profile is.</p>
<p>The larger startups act like large companies, having a dedicated arm to hire talented freshers/interns and nurture talent so that they can become a part of company culture. They will typically act like large firms, HR CV sifting, tech rounds, salary negotiations and so on. A fresher on hiring here can expect proper orientation, training and a career like traditional jobs {with some more challenges and fun}. There will be formal calls for internships and people sending resumes and referrals here to apply. Let’s call it type A.</p>
<p>There is another extreme which is a garage startup where everything is figuratively on fire and they are looking for cheap hands to just “man the wall”. They will hire almost anyone as long as you don’t have expectations of high salary. If you learn stuff well while being on job, you might be able to get good leverage and stocks later on. Interns in such startups are proper employees, handling stuff that the founders cannot squeeze into their 24 hours. Let’s call it Type B.</p>
<p>So while Type A has more of a “formal training to smart people” approach, Type B has more of a “learn on the job” perspective.</p>
<p>Then there is everyone in the middle. Looking to possibly get a product market fit or scale according to crazy investor expectations. They are in middle of Type A and Type B. These startups IMO are looking for “self-starters”, people who can actually get small things done, so that they can own small chunks of their products and help senior people focus on harder problems {There is never a lack of hard problems}. Let’s call this type C.</p>
<p>So, if you are a fresher who is good at academics, have a good CV, try applying for type A startups. Look for open internships on their careers page/LinkedIn or write to their HR.</p>
<p>If you want to learn from the very basics, apply as a fresher intern in a type B startup. Just write to the founders directly in this case. Look for recent seed fundings on Yourstory or Inc 42 or news about startup incubators/accelerator shortlists or your startup whatsapp groups for such companies.</p>
<p>If you have some basic knowledge of some technology stack/ business or operations stack and want to apply it, Type C is a good place to actually learn more and apply these skills. Just write to their careers address or the founders or senior people from these companies you follow to learn more about the field you are interested in.</p>
<h3 id="q-what-are-the-career-opportunities-in-india-for-a-graduate-student-who-studied-computer-science-in-the-us-and-now-wants-to-move-back-to-india">Q. What are the career opportunities in India for a graduate student who studied computer science in the US and now wants to move back to India?</h3>
<p>Originally answered here : <a href="https://qr.ae/pNzcH5">https://qr.ae/pNzcH5</a></p>
<p>This answer has my personal opinions as a recruiter, who has interviewed US graduate students in past and many many Indian aspirants for the same job profiles.</p>
<p>India now has Computer Science jobs which are <em>very well</em> paying from Indian standards and involve graduate level work. Not just at my startup, but at other startups and enterprises as well. However, US graduate students are at a great disadvantage when it comes to Indian jobs. They have a big liability in terms of the student debt they have accrued and the US credentials have little benefit to offer over Indian students who have learned advanced Computer Science using open study materials and MOOCs. You can find many Indian applicants who have better exposure to research projects in IITs and IIITs demanding lesser salaries than someone who attended a tier 2 or 3 US university with just plain coursework MS program. Even for normal Indian students not having exposure to research, studying Data Structure and Algorithms at a tier 2 US university is not really better than taking and passing a Stanford algorithms course on Coursera in my opinion. And thinking of it, there are Indian students who have written papers with IIT professors in tier 1 / tier 2 Computer Science conferences competing for the same job profiles demanding lesser salary, people with plain coursework US degrees don’t compete well. People with good research exposure during graduate studies might be able to compete with Indian jobseekers, but I frankly haven’t seen many such students seeking jobs in India.</p>
<p>People who have studied at Stanfords and MITs have a brand that can get them employed at institutions which can afford the extremely high salaries US graduate students on an average demand. But if you have a tier 2/ tier 3 US university degree or are going for it, know that it is a package deal where you have to work in the US after your degree at least till you have your debt sorted.</p>
<h3 id="q-how-can-i-learn-the-python-language-easily-i-am-in-10th">Q. How can I learn the Python language easily? I am in 10th.</h3>
<p>Originally answered here: <a href="https://qr.ae/pNVwKs">https://qr.ae/pNVwKs</a></p>
<p>Use Youtube. There are many different introductory level Python tutorials available. In fact, try out many of them to see whose teaching style sits best with you. I learnt Python around 10 years back fully from a Youtube channel because as a student I found reading books cover to cover quite boring. The channel was thenewboston , whose tutorial videos from then are still online {but irrelevant today as they were for Python2 } :</p>
<p><a href="https://youtu.be/E6rnfHgyPmM">h<img src="https://muktabh.xyz/assets/img/2020-09-30-Advice-to-youngsters-who-are-starting-engineering-education-now-and-Aspire-for-a-career-in-Data-Science-AI-or-Entrepreneurship/media/image1.png" alt="" />ttps://youtu.be/E6rnfHgyPmM</a></p>
<p>Given I have watched some videos from freecodingcamp and liked them, I would recommend you to maybe start your search for a good course on youtube from freecodecamp :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-09-30-Advice-to-youngsters-who-are-starting-engineering-education-now-and-Aspire-for-a-career-in-Data-Science-AI-or-Entrepreneurship/media/image2.png" alt="" /></p>
<p><a href="https://youtu.be/rfscVS0vtbw">https://youtu.be/rfscVS0vtbw</a></p>
<p>You can also try free Udemy courses. Don’t buy one, login then search for “Python” courses and on the filter menu choose price as free to find free courses on Udemy. Udemy courses are somewhat more structured and completing the course gives feeling of accomplishment if you like that.</p>
<h3 id="q-do-you-agree-that-career-curve-of-a-software-professional-can-be-expressed-as-bell-curve-as-shown-in-the-video-">Q. Do you agree that Career Curve of a software Professional can be expressed as Bell Curve as shown in the video ?</h3>
<p>https://youtu.be/20jtW4kYxjY</p>
<p>Originally answered here : <a href="https://qr.ae/pNZr2T">https://qr.ae/pNZr2T</a></p>
<p>First of all, this psuedoscience should stop using Normal Distribution so lightly. Bell Curve has a meaning and I am pretty sure career trajectories don’t follow it. <a href="https://en.wikipedia.org/wiki/Normal_distribution">Normal distribution - Wikipedia</a></p>
<p>Secondly, there might be some truth in what the person is saying (given that is what one find obvious to happen). The growth rate of a person they correlate with years of experience roughly correspond to people’s priorities in life. Young people place high priority on dating and parties and slowly get more and more career oriented with time, until they start putting their families on high priorities and career becomes means to make money for family. People who think that the experience in years numbers is the one factor that decides growth rate are just falling for a simple Simpson’s Paradox IMHO.</p>
<h3 id="q-in-which-track-of-software-development-or-any-computer-science-related-job-for-example-full-stack-developmentbackendmachine-learningdevops-do-we-use-data-structures-and-algorithms-the-most">Q. In which track of software development or any computer science related job (for example, full stack development/backend/machine learning/DevOps), do we use data structures and algorithms the most?</h3>
<p>Originally answered here : https://qr.ae/pNzcEG</p>
<p>In all these places.</p>
<p>I mean you cannot write any Python program without using dictionaries or lists (or arrays in Data Science). They are all Data Structures. All profiles you mentioned will require Data Structures and Algorithms, mostly as language constructs or libraries. Sorting algorithms are just calling sorted() in most real world scenario, most standard things are pre-implemented.</p>
<p>What many people mean by “using” Data Structures and Algorithms in such questions is actually “implementing” complex data structures and algorithms. That is generally when you are familiar with a domain (and programming) enough that you start designing APIs or start solving open ended problems for which no APIs or libraries are available.</p>
<h3 id="q-is-there-ml--ai-in-the-it-syllabus-can-i-learn-ethical-hacking-in-it">Q. Is there ML & AI in the IT syllabus? Can I learn ethical hacking in IT?</h3>
<p>Originally Answered here: <a href="https://qr.ae/pNbc6V">https://qr.ae/pNbc6V</a></p>
<p>This question cannot be answered in a Yes or No. IT degrees are not regulated (which is a good thing!) and hence are free to decide what to teach and what not to. Basically, answer is “depends upon what college you pick”</p>
<p>You will need to make an effort to find out what courses are taught at a program you are applying for. That may/may not have Artificial Intelligence / Machine Learning courses or Ethical Hacking courses.</p>
<h3 id="q-what-are-the-advantages-and-disadvantages-of-working-in-product-based-companies">Q. What are the advantages and disadvantages of working in product based companies?</h3>
<p>Originally answered here: <a href="https://qr.ae/pN5oER">https://qr.ae/pN5oER</a></p>
<p>With the kind of blanket points about product based/service companies I see in other answers, I think the stereotyping is already done.</p>
<p>First of all, one should take any statements like “all X are Y” with a grain of salt, there is some probability of truth in such statements, but they cannot be used to take decisions.</p>
<p>There can be unique facets to working in a product based company or service company like being able to focus on a product long term or solving many challenges over time (in service companies). These are not really Pros and Cons.</p>
<p>Let me now suggest you to take decision of where you want to work based on what is important for you, rather than whether the company is product based or service based. These things are :</p>
<ol>
<li>
<p>Who pays more money right now. (There are low/high paying product/service companies, how much it pays depends upon the company’s business model)</p>
</li>
<li>
<p>What is the outcome of investing X years with the company, do you get locked in or do many opportunities open up for you. (This depends upon the work practices of the department you are put in rather than you are in a product/service company)</p>
</li>
<li>
<p>Personal Growth. (Be selfish, ask what it has at the end of it for you)</p>
</li>
</ol>
<p>Talk to some ex-employees of the companies about their experience. Understand why they have any perceptions about company (if any). Checkout their Glassdoor, remember the following : <a href="https://news.ycombinator.com/item?id=24789865">A warning about Glassdoor</a></p>
<p>Taking a decisions about your work on a broad metric like whether a company builds a product or provides services makes no sense.</p>
<h3 id="q-can-a-non-technical-person-start-an-ai-startup">Q. Can a non-technical person start an AI startup?</h3>
<p>Originally answered here: https://qr.ae/pNVKCz</p>
<p>Yes. They can.</p>
<p>The most important skill as a startup founders are : 1. Storytelling and 2. Getting the right team onboard. If you have these skills, you can start an AI company and get other people who know AI onboard to solve the problem for you.</p>
<p>Although 1 and 2 sound very simple skills, 1 basically determines how well can you sell your product to customers and investors {thus raising money} and 2 needs both identifying the right people and getting them onboard. Both 1 and 2 are rare skills. That said, you will need an AI person in the team as early as possible to keep your storytelling grounded. You will need to understand what is achievable with current day technology rather than building your startup stories around technology hyperbole.</p>
<p>Some observations from me about initial stages of an AI startup : <a href="https://muktabh.xyz/2020/08/30/Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One.html">Patterns I Noticed While Getting An Ai Startup From Zero To One</a></p>
<h3 id="q-how-hard-is-it-to-find-and-hire-people-with-great-ai-skills-or-expertise-for-a-new-ai-startup">Q. How hard is it to find and hire people with great AI skills or expertise for a new AI startup?</h3>
<p>Originally answered here : https://qr.ae/pNcncP</p>
<p>Very. At least for now, most people in these fields have expectations to work at a FAANG company with a FAANG salary. That is extremely hard to afford.</p>
<p>Luckily in case of my startup, one of the founders (that is me) had interest in the field to work as an individual contributor as well as to set expectations of our investor that we would hire people who would tinker and learn on the job by trial and error.</p>
<p>Don’t start a new AI company IMO if :</p>
<ol>
<li>
<p>You cannot onboard someone who can get things done in the field as a founding team member (or)</p>
</li>
<li>
<p>Raise enough money to compete with FAANG salary with salary and ESOPs.</p>
</li>
</ol>
<p>Some points I could figure out starting an AI company are listed here :</p>
<p><a href="https://muktabh.xyz/2020/08/30/Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One.html">Patterns I Noticed While Getting An Ai Startup From Zero To One</a></p>
<h3 id="q-how-can-we-get-data-for-a-machine-learning-startup">Q. How can we get data for a machine learning startup?</h3>
<p>Originally answered here: https://www.quora.com/How-can-we-get-data-for-a-machine-learning-startup?top_ans=254282506</p>
<p>Figuring out where to get the initial training data from is one the hard things in a Machine Learning startup. Its as hard as figuring out a product market fit (or maybe somewhat easier but still quite hard).</p>
<p>Some things you need to think of :</p>
<ol>
<li>
<p>If you are building a Machine Learning startup, the better your algorithms, the better name you get.</p>
</li>
<li>
<p>For most Machine Learning algorithms, more training data generally gets much higher accuracy.</p>
</li>
<li>
<p>Acquiring annotated data requires money and investment. In fact there are some domains where you don’t have the data publicly available to capture.</p>
</li>
</ol>
<p>Some suggestions from my experience :</p>
<p>A. Don’t do a startup in a domain where acquiring data is hard. (Of course unless you have some unique skill/contacts to get this data).</p>
<p>B. Raise a lot of money (using your skills or credentials) and then get the data annotated by investing some amount of this money.</p>
<p>C. Build a product that has a feedback mechanism to learn from errors. Spend relatively less amount of money correcting the Machine Learning predictions (which is during the feedback part) and put this data back into the retraining Machine Learning algorithms, so that it gets better.</p>
<p>Some detailed thoughts here about an early stage AI/ML startup : <a href="https://muktabh.xyz/2020/08/30/Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One.html">Patterns I Noticed While Getting An Ai Startup From Zero To One</a></p>
<h3 id="q-how-do-i-find-investors-for-a-start-up-business-in-india">Q. How do I find investors for a start up business in India?</h3>
<p>Originally answered here: <a href="https://qr.ae/pNiVrO">https://qr.ae/pNiVrO</a></p>
<p>I hope the author of the question is a person who is hoping to do a startup in future (and not someone who is already started a company). Dont start a company before you understand the importance of fundraising and cash. Startups unlike traditional businesses depend a lot on the fund raising capabilities of founders.</p>
<p>About raising for a startup, the following is what any standard online “guide” will tell you:</p>
<ol>
<li>
<p>Have a vision for the company.</p>
</li>
<li>
<p>Have some kind of a working prototype/PoC</p>
</li>
<li>
<p>Create a pitch for your product, long version and short version.</p>
</li>
<li>
<p>Network, there are many startup events where there are investors looking for startups and many many startups looking for investors. Go out and pitch your idea and vision using your prototype. It will take many many pitches, multiple events and one-to-one meetings before someone writes you the first cheque (unless you have a team with excellent credentials) , subsequent cheques will be even harder.</p>
</li>
<li>
<p>Adapt to the feedback from your customers and potential investors. Its not necessary that you incorporate all feedback (many people give feedback just to feel smart, not because they know), use your judgement, but adapt your vision, pitch and product. Understand that its next to impossible for someone to intuitively come up with a superb product.</p>
</li>
<li>
<p>Read about the rest of the ecosystem. Its slightly easier if you are going in flow and in sync with what is trendy these days. EdTech for example will yield more funding than Tourism based ideas in November 2020 : <a href="https://www.quora.com/Does-Edtech-industry-really-got-a-boom-due-to-Covid-19-since-most-people-started-learning-online/answer/Muktabh-Mayank?ch=10&share=3e8e31eb&srid=qie">Muktabh Mayank’s answer to Does Edtech industry really got a boom due to Covid 19 since most people started learning online?</a></p>
<ol>
<li>
<h3 id="q-which-do-you-think-is-better-for-an-entrepreneur-planning-to-create-tech-startups-an-mba-or-a-cs-degree-and-why">Q. Which do you think is better for an entrepreneur planning to create tech startups; an MBA or a CS degree? And why?</h3>
</li>
</ol>
</li>
</ol>
<p>Originally answered here: https://qr.ae/pNaYyn</p>
<p>This is going to be very subjective so take this with a grain of salt. My life experience doesn’t necessarily model the world.</p>
<p>The answer in short is : Depends upon the type of startup you are creating. If you are starting a company where a lot of contacts are needed, MBA might work. Contacts help if you want to raise large of money even before product works (say you are developing an electric vehicle company or starting a modern coffee chain or you are trying to get into well set supply chain of a country etc). There are moonshots which need one to able to raise a lot of money just on credentials, an MBA from GSB or HSB is basically a credential. If I try to explain it more, its the type of companies where differentiator is not technology but the scale of idea itself working on commodity tech. An hi-scale idea + commodity-tech business market is open generally because contacts are required to pull it off and few people have them. A good (but controversial) example of such a business is WeWork (before Neumann came into news for all the wrong reasons). MBA’s aim as a degree is basically to build network in less time. Other than that, no part of business is a skill that can be taught :</p>
<p>There is no skill called “business.” Avoid business magazines and business classes.</p>
<p>— Naval (@naval) <a href="https://twitter.com/naval/status/1002107808202960896?ref_src=twsrc^tfw">May 31, 2018</a></p>
<p>Basically one of your batchmates or seniors from B-school might be running the funds which can invest than amount of money without a product. If your company is selling to large businesses where your batchmates are decision makers, this network might help you get a step in the door for sales.</p>
<p>If you are starting a company where a product is differentiated by tech, almost all aspects apart from sales do not require contacts. However, building non commodity tech does require knowledge about computers.</p>
<p>Study microeconomics, game theory, psychology, persuasion, ethics, mathematics, and computers.</p>
<p>— Naval (@naval) <a href="https://twitter.com/naval/status/1002107869209096192?ref_src=twsrc^tfw">May 31, 2018</a></p>
<p>That said, being an tech entrepreneur doesn’t always need a full degree in Computer Science, one needs to understand what computers can do and where to find teammates who can make the tech work for the idea. That is all. This includes ideas like Oyo, Flipkart, PayTM, Cred and so on.</p>
<p>OTOH, there are some ideas which can only come to someone as a techie (say developer tools or new tech infrastructure). I don’t think a non Computer Science educated (formally/informally) founder can develop these:</p>
<table>
<tbody>
<tr>
<td>[Postman: a software startup valued at around $2 billion</td>
<td>Gadgets Now](https://www.gadgetsnow.com/slideshows/meet-the-6-indian-startups-to-join-the-billion-dollar-club-in-2020/Postman-a-software-startup-valued-at-around-2-billion/photolist/78614778.cms)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-09-30-Advice-to-youngsters-who-are-starting-engineering-education-now-and-Aspire-for-a-career-in-Data-Science-AI-or-Entrepreneurship/media/image3.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/Docker,_Inc">https://en.wikipedia.org/wiki/Docker,_Inc</a></p>
<p>.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-09-30-Advice-to-youngsters-who-are-starting-engineering-education-now-and-Aspire-for-a-career-in-Data-Science-AI-or-Entrepreneurship/media/image4.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/Databricks">Databricks - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-09-30-Advice-to-youngsters-who-are-starting-engineering-education-now-and-Aspire-for-a-career-in-Data-Science-AI-or-Entrepreneurship/media/image5.png" alt="" /></p>
<p><a href="https://inc42.com/buzz/julia-computing-funding-2/">Julia Computing Raises $4.6 Mn Funding From General Catalyst</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-09-30-Advice-to-youngsters-who-are-starting-engineering-education-now-and-Aspire-for-a-career-in-Data-Science-AI-or-Entrepreneurship/media/image6.png" alt="" /></p>
<p><a href="https://en.wikipedia.org/wiki/Hasura">Hasura - Wikipedia</a></p>
<p><img src="https://muktabh.xyz/assets/img/2020-09-30-Advice-to-youngsters-who-are-starting-engineering-education-now-and-Aspire-for-a-career-in-Data-Science-AI-or-Entrepreneurship/media/image7.png" alt="" /></p>
<h3 id="q-can-you-get-a-good-programming-job-in-india-within-3-months-if-you-have-never-programmed-before-but-are-a-quick-learner">Q. Can you get a good programming job in India within 3 months if you have never programmed before but are a quick learner?</h3>
<p>Originally answered here : <a href="">https://qr.ae/pNaNPe</a></p>
<p>“Can you get a good programming job ?” I don’t think so.</p>
<p>“Can you get an entry level programming job ?” I think this is possible given that you are able to become comfortable with programming.</p>
<p>Please remember programming is like learning a language (say English). Very few ‘good’ jobs are given on the basis that someone knows a language. You need to understand the domain : hospitality, education, multimedia, journalism etc. along with knowledge of English to get a good job. But that said, you can be an intern at a newspaper or a trainee at a hotel and learn about the domain there.</p>
<p>Similarly, after learning programming, you can get an entry level job as a web developer, data engineer, data scientist, embedded systems engineer etc. But you will have to gain expertise in the particular field along with programming to get a good job.</p>
<h3 id="q-whats-the-difference-between-an-iitian-who-gets-a-yearly-package-in-crores-and-a-first-generation-entrepreneur">Q. What’s the difference between an IITian who gets a yearly package in crores and a first generation entrepreneur?</h3>
<p>Originally answered here : <a href="">https://qr.ae/pNJvvv</a></p>
<p>I graduated from my college with a better than average job offer and then worked for 2 years before I quit to start my own company. So, I can probably answer this question from both sides.</p>
<p>I am not an IITian, but I am a first generation entrepreneur. Also, I did not get package in crores after my college so I cannot tell how much a crore rupees in your bank account looks like. {Frankly, a package in crores in only for people who are joining companies on the US west coast where cost of living is very very high, so its much less money than probably what you might expect it to be !}. Another person I know very well qualifies exactly for the question [IITian, package in crores, came back to India to become a first time entrepreneur]. So I will try to put my observation of them in this answer too.</p>
<p>About job and building a company :</p>
<ol>
<li>
<p>Building a company is much harder and requires much more patience than day to day job. So, you will probably never be able to start your own company if you are working on something you are not passionate about. It is just too much of a responsibility, you cannot do it part time or do it without interest. The same amount of passion which you possibly feel about your college crush or cracking JEE is needed, possibly for more time.</p>
</li>
<li>
<p>Despite a day-to-day job being relatively easier, it is much more frustrating. People feel bad about weekend ending when working in a company, in a startup they can work all weekend and then the next week.</p>
</li>
<li>
<p>Building a startup requires much more thick skin. If someone says something to you in a day job you might feel bad (and maybe quit in search of better company culture), 10s of people will criticize your product in a startup and you will probably have to convince and sell to these same people.</p>
</li>
<li>
<p>Building a startup is much more risky. I am not going to sugar coat it for you, but you might seriously be behind your peers in terms of income while possibly being ahead of them in wealth. This is a unique scenario as most Indians [and people from families of first time entrepreneurs] equate social status with income and not wealth. 2–3 years down into a startup and unless you are very lucky you might be living a less “lavish” lifestyle than your peers, for some small probability that you ca become super rich in furture. Also wealth [valuation of your stock] you accumulate in a startup is very high risk, as its all eggs in one basket, your company might close and cash flow of your company is effected due to COVID disruption, and your wealth might become zero.</p>
</li>
<li>
<p>Also the dedication required in a startup effects your social life. If an introvert in a regular job gets 5/10 in social life, an introvert in a startup would get 2/10 at best. If they are getting more than this, they are not putting enough effort IMO.</p>
</li>
<li>
<p>Its not just you who is taking risk as a Data Scientist, its your family, your significant other and other near and dear ones. You will need to sell your vision and care about getting outcomes in time to make your way ahead and keep everyone interested.</p>
</li>
<li>
<p>Startup is what the authors of Freaknomics call “Tournament” lifestyle, you are either on top [in 1% or 0.1% cases] or you are behind average. Day to day job keeps one close to the average. Average [after passing out of IIT] is not bad by the way. Most people are thus like “why take risks ?”</p>
</li>
</ol>
<p>Understand more about Tournament lifestyle here : <a href="https://www.quora.com/How-can-I-stand-out-as-a-machine-learning-artificial-intelligence-engineer-in-India-Additional-details-in-comments/answer/Muktabh-Mayank">Muktabh Mayank’s answer to How can I stand out as a machine learning/artificial intelligence engineer in India? Additional details in comments.</a></p>
<p>Another essay you might find interesting : <a href="https://www.quora.com/Everyone-says-India-needs-more-entrepreneur-But-the-same-people-want-their-friend-or-child-to-be-in-a-big-company-or-a-good-government-job-Why/answer/Muktabh-Mayank">Muktabh Mayank’s answer to Everyone says “India needs more entrepreneur”. But the same people want their friend or child to be in a big company or a good government job. Why?</a></p>
<h3 id="q-how-can-i-start-my-own-startup-using-artificial-intelligence">Q. How can I start my own startup using artificial intelligence?</h3>
<p>Originally answered here : <a href="">https://qr.ae/pNbEW5</a></p>
<p>It will take decades/centuries before AI can just let you start a full company. Like “Jarvis, start a company which does X!”. I think that was not being asked in the question in the first place, but just in case.</p>
<p>Typical method I think you can use while starting a business where you want to use AI as a tool :</p>
<ol>
<li><strong>Know about what can be done using current advances in AI.</strong> A typical rule of thumb as of 2020 is anything which humans take a few seconds to take a decision can be done by existing AI techniques too. Don’t read MSM coverage of AI, its often plain wrong, read research or close to research tech articles to understand what is actually possible and what is hype (There is a lot of hype). Stay away from things that follow a <a href="https://en.wikipedia.org/wiki/Fat-tailed_distribution">Fat-tailed distribution - Wikipedia</a></li>
</ol>
<p>(like predicting success) and do <a href="https://en.wikipedia.org/wiki/Phrenology">Phrenology - Wikipedia</a></p>
<ol>
<li>
<p>(detecting psychology from appearances). Typical usecases of currently existing AI algorithms are recognizing stuff in images, reading / classifying and responding to text, catching out of ordinary patterns in data (customer churn / credit default guesses), understanding and responding to human speech etc.</p>
</li>
<li>
<p><strong>Make a list of problems:</strong> Make a list of real world problems where there are inefficiencies or frustration. See how existing AI can solve the problem. If you want to invent something to solve the problem of your choice, get a research grant, not venture capital. Only build what can be solved by existing AI techniques.</p>
</li>
<li>
<p><strong>Build a prototype quickly :</strong> Collect some data and quickly build a prototype. Pick off the shelf AI models. This is very important, as it makes sure you are not all gas.</p>
</li>
<li>
<p><strong>Approach early adopters and start setting up moats:</strong> Once you have a prototype, its time to reach out to and find early adopters. Also its time to think of what will be your moat and start taking first steps towards it.</p>
</li>
</ol>
<p>A very detailed set of my observations about what needs to be done after you figure out a business idea can be found here: <a href="https://muktabh.xyz/2020/08/30/Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One.html">Patterns I Noticed While Getting An Ai Startup From Zero To One</a></p>Collecting my answers from Quora, where I advice young students getting into engineering now and aspiring to build a career in Data Science, AI or Programming.Startups During Pandemic Disruption2020-09-12T00:00:00-05:002020-09-12T00:00:00-05:00https://muktabh.xyz/2020/09/12/Startups-During-Pandemic-Disruption<h3 id="my-answer-to-what-is-the-effect-of-the-covid-19-pandemic-on-ai-based-startups">My answer to “What is the effect of the covid-19 pandemic on AI-based startups?”</h3>
<p>Originally Answered here: <a href="https://qr.ae/pNC3bb">https://qr.ae/pNC3bb</a></p>
<p>There are two types of startups using AI IMO :</p>
<ol>
<li>
<blockquote>
<p>AI first startups : Companies that are selling an AI algorithm or outputs of an AI algorithm as its product. My startup <a href="http://paralleldots.com/">Image Recognition to Optimize Retail Execution</a></p>
</blockquote>
</li>
</ol>
<!-- end list -->
<ol>
<li>
<blockquote>
<p>belongs to this category. There can be variety of startups in this category trying to sell chatbots, automated surveillance, voice recognition systems, fancy apps that change face photos into old/young or morph them, heck even startups which provide AI tools to ensure compliance during COVID19-prevention which fall in this category.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>AI augmented companies : Companies that use AI to enhance an already existing products they have or trying to integrate AI into their product. Typical examples would be an email service providing company trying to use AI to assist writing, a manufacturing company trying to deploy smarter robots in their factories, CRM trying to rate prospective leads and an e-commerce company showing recommendations to its customers.</p>
</blockquote>
</li>
</ol>
<p>As you might be easily able to guess, there will many more companies of type 2, as most organizations have some or the other problem statements they would like to address using AI algorithms. Basically every company in the world whose core product is not an AI algorithm falls in 2. These companies account for most AI related jobs as A. They are relatively larger companies than most AI first companies, most AI first companies are smaller startups as of today and 2. There are just too many AI augmented companies as compared to AI first companies.</p>
<p>This differentiation was necessary as COVID19 disruption needs to thought of in different ways for 1 and 2. You cannot merge them both into a single set of predictions.</p>
<p><strong>AI first companies :</strong></p>
<p>When you are looking at AI first companies, their trajectory during COVID19 is dependent upon what customers are they serving and what problems are they solving. Different companies saw different outcomes. The following characteristics provided worst-to-best outcomes for companies :</p>
<ol>
<li>
<blockquote>
<p>Companies which were serving industries which depended upon people moving out of their homes will have had very severe outcomes. These are companies which provided AI solutions to travel sector, malls, hotels, airlines, offices etc. Money in such verticals is almost non-existant for time being and will be for sometime.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>There are industries which despite being hit with COVID-19 cannot close down as they are essential industries. These are retail, healthcare, government services, telecom, banking etc. AI startups these industries saw steep revenue declines during lockdown period as everyone was really afraid at that time and was observing how will the future look, however, with markets reopening, the revenues are slowly becoming stabilized and coming back to normal. New pilots have started rolling out too. Such companies are taking precautions.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>Both of the above points were for B2B AI startups. B2C startups, if they had any chance of becoming successful, would have had a great time during COVID-disruption as people were locked down at homes and had lot of free time to spend on their phones. Many face swap videos and lipsync videos made using AI went viral on the internet during the disruption.</p>
</blockquote>
</li>
<li>
<blockquote>
<p>It has been a really great time for startups that help institutions monitor COVID19-prevention compliance or help companies and organizations maintain social distancing or help them move their operations online during COVID19 as their services became “pain pills”. A few startups with bad outcomes in 1 (or maybe 2), launched new AI products of this category. This involves some kinds of chatbots, face mask monitors and AI+robotics applications reducing/removing human contact. Ecommerce and delivery AI startups should be having a great day as well.</p>
</blockquote>
</li>
</ol>
<p>Net-Net, some companies gained, other companies lost.</p>
<p><strong>AI augmented companies :</strong></p>
<p>The story is very different here. Please remember that while for some companies like OTT, e-commerce etc., AI has shown clear cut value; most companies in this category are running AI Proof-of-Concepts and Product Development in hope that one day they should be able to get lead over their competitors using their AI edge. So most AI operations in such companies (startups or even larger) are discretionary/R\&D expenses. Most startups during COVID19 disruption have cut discretionary expenses to prolong their runway. Same would be the case with larger companies too. This have brought expansion in AI activities and hiring in such companies to a standstill. Hence, you would see tweets like this :</p>
<p>I think it’s clear that for many smaller companies that invested in deep learning, it turned out not to be essential and got cut post-Covid as part of downsizings. There are somewhat fewer people doing deep learning now than half a year ago, for the first time since at least 2010</p>
<blockquote>
<p>— François Chollet (@fchollet) <a href="https://twitter.com/fchollet/status/1300137812872765440?ref_src=twsrc^tfw">August 30, 2020</a></p>
</blockquote>
<p>Hope this answers your question.</p>
<h3 id="my-answer-to-have-small-tech-companies-such-as-fastly-been-affected-by-the-pandemic-in-the-same-way-as-large-tech-companies-like-microsoft">My answer to “Have small tech companies such as Fastly been affected by the pandemic in the same way as large tech companies like Microsoft?”</h3>
<p>Originally Answered Here: https://qr.ae/pNCdmF</p>
<p>Tech companies serve either other companies (B2B) or consumers (B2C). When an uncertain situation comes up, any customer (be it companies or consumers) will tighten the strings of their purse as its hard to predict the future. When less money is in circulation, you see GDP falling and companies, businesses and even government making lesser money. Companies who are already alert will react to sudden revenue decline even more proactively, cutting off discretionary expenses like say R\&D or new projects or HR redundancy. That gets many projects defunded, wages cut and you see even lesser money being spent. Basically a vicious cycle of economic bust. It exactly opposite of what happens in economic growth. Its hard to visualize this, but a lot of economy is just people believing that a company, country or economic system is “worth putting in money”.</p>
<p>I do not think big company / small company dichotomy can be used to explain which tech company did bad or well during pandemic disruption. A company’s performance during/after pandemic IMO will be dependent upon a combination of :</p>
<p>A. how hedged company is against risk,</p>
<p>B. how much does pandemic effect the customer base of the company and</p>
<p>C. whether the pandemic creates new opportunity for the company.</p>
<p>I did a very detailed analysis in terms of AI startups here: <a href="https://qr.ae/pNC3bb">Muktabh Mayank’s answer to What is the effect of the covid-19 pandemic on AI-based startups?</a></p>
<p>The combination of three factors A,B and C above make sure that you have super success stories in startups (new decacorns like Fastly or Zoom were born) where on the other hand many startups shut shop or cut their team massively. Startups whose consumer base did not get effected or ones who were hedged with large runway actually many a times used the pandemic as an opportunity. Because startups differ at A,B and C, you see varied results like :</p>
<p>Digital Transformation Reality Check: Not all SaaS companies have benefited from Covid! In fact, I’d argue only 3 (Zoom, Shopify, Fastly) have truly benefited. With Q2 earnings mostly under wraps, we can look at the absolute change in growth rates from Q2 - Q1 <a href="https://t.co/uYVKpxd3Pi">pic.twitter.com/uYVKpxd3Pi</a></p>
<p>— Jamin Ball (@jaminball) <a href="https://twitter.com/jaminball/status/1304179212366958593?ref_src=twsrc^tfw">September 10, 2020</a></p>
<p>Large companies are generally supposed to be more fragile and strong to take advantage of opportunities that arise due to a disruption like the pandemic, but many of them were busy buying back there shares instead of hedging themselves and they now have to beg for shareholders to bail them out.</p>
<h3 id="my-answer-to-is-wfh-a-bonus-for-tech-firms">My answer to “Is WFH a bonus for tech firms?”</h3>
<p>Originally Answered here: <a href="https://www.quora.com/Is-WFH-a-bonus-for-tech-firms/answer/Muktabh-Mayank">https://www.quora.com/Is-WFH-a-bonus-for-tech-firms/answer/Muktabh-Mayank</a></p>
<p>Maybe, but we don’t know that</p>
<p>Large scale WFH has never been tried before. The tech industry had two alternatives, large scale Work From Home (WFH) or shut down work temporarily. 100s of people sit in a common workplace with air conditioning and it was extremely risky to continue in office work. Between two options work from home was better without doubt.</p>
<p>Whether WFH is better than regular office is still not clear. Companies save money by not paying office maintenance or sometimes office rents altogether. So assuming nothing else changes, the companies should be at a gain. But, things are not that simple.</p>
<p>Working from home has created new challenges, like say, time sync and even simple things are relatively hard to communicate. While people who have more visibility have equal productivity, freshers find it harder to work remotely. We still dont know if the penalty due to these challenges is lesser than the office expense saving or no. But we know that the penalties should get better with time as people slowly overcome their inhibitions over working remotely.</p>
<blockquote>
<p><a href="https://fortune.com/2020/08/10/remote-work-from-home-cost-zoom-innovation-google-goldman-sachs/">Remote work from home during coronavirus pandemic hurts collaboration, innovation</a></p>
</blockquote>
<p><img src="https://muktabh.xyz/assets/img/2020-09-12-Startups-During-Pandemic-Disruption/media/image1.png" alt="" /></p>
<h3 id="my-answer-to-has-indias-silicon-valleys-success-been-neutralized-by-covid-19">My answer to “Has India’s Silicon Valley’s success been neutralized by Covid-19?”</h3>
<p>Originally answered here: <a href="https://qr.ae/pNF5Vr">https://qr.ae/pNF5Vr</a></p>
<p>What do you mean by India’s Silicon Valley ? Do you mean Indian startups ?</p>
<blockquote>
<p>I personally think we haven’t had any success as a Silicon Valley alternative. We dont develop nearly enough good technology products yet. We have huge operations based startups like E-Commerce, e-Grocers, e-Milkmen, e-classes(edutech) and e-XYZs. These according to me dont qualify as Silicon Valley “success”. Only successes we have had with pure tech play in past are Chennai SaaS heavyweights like <a href="https://www.zoho.com/">Zoho - Cloud Software Suite and SaaS Applications for Businesses</a></p>
<table>
<tbody>
<tr>
<td>and <a href="https://www.freshworks.com/">A fresh approach to customer engagement</a> . That said, we are slowly beginning to see Indian success in High end Technology startups like say <a href="https://www.greyorange.com/">Home - GreyOrange</a> , [Hasura</td>
<td>Instant GraphQL APIs for your data</td>
<td>Join data across databases, GraphQL & REST services to build powerful modern applications](https://hasura.io/) and [Postman</td>
<td>The Collaboration Platform for API Development](https://www.postman.com/) . One year of bad economics is not going to change or reverse the trend. Postman infact became a unicorn (valued at US$ 2B) during the COVID pandemic. [Postman’s valuation soars to $2B with latest round</td>
<td>PitchBook](https://pitchbook.com/news/articles/postman-valuation-2-billion)</td>
</tr>
</tbody>
</table>
<p><img src="https://muktabh.xyz/assets/img/2020-09-12-Startups-During-Pandemic-Disruption/media/image2.png" alt="" /></p>
</blockquote>
<p>Ok. But I think to most Indians, Silicon Valley success in India generally means the Flipkarts and other operations startups which deliver your milk or groceries or cellphones or teaches math to your kids or helps you sell your old and new stuff. Luckily, these startups are growing better than expected. In fact, they are growing at the cost of regular Indian businesses due to the lockdowns, fears in going out and quarantines. You can read 100s of articles about the Antifragile Indian startup ecosystem published in last few days</p>
<h3 id="my-answer-to-why-are-top-companies-like-uber-and-oyo-laying-off-so-many-employees-during-the-covid-19-pandemic-despite-being-the-top-in-their-sector">My answer to “Why are top companies like Uber and Oyo laying off so many employees during the COVID-19 pandemic despite being the top in their sector?”</h3>
<blockquote>
<p>Originally answered here: <a href="https://qr.ae/pN5T5P">https://qr.ae/pN5T5P</a></p>
<p>{I am trying to strip it down to very basic answer, it might actually lose some depth here in the way to make the big picture clear. Do understand that there are many many more details into play and all businesses are unique. }</p>
</blockquote>
<p>To understand this, you need to understand how these high growth startups work as opposed to large companies.</p>
<ol>
<li>
<blockquote>
<p>Large established companies have had a lot of time to settle in the market, optimize their practices to better their bottomline and thus optimize profits. That is once an established company/business is sure it has reached the peak market share (equilibrium between customer acquisition / attrition ), it would then try to optimize expenses, thus maximize profits and invest some parts of profits into innovations to launch new products. So in time of crisis, its a pretty simple process for the established businesses, they will cut down discretionary expenses and focus on their optimized profit making core. So they will cut jobs for products that make less profit, but the employees who work on their power products, continue to work and thrive. It is wrong to just blame all layoffs on startups, established companies have done layoffs too. <a href="https://economictimes.indiatimes.com/news/international/business/britains-rolls-royce-to-cut-9000-jobs-amid-air-travel-slump/articleshow/75842204.cms">Britain’s Rolls-Royce to cut 9,000 jobs amid air travel slump - The Economic Times</a>; <a href="https://www.crn.com/news/networking/at-t-layoffs-carrier-to-lay-off-thousands-due-to-covid-19">AT\&T Layoffs: Carrier To Lay Off Thousands Due To COVID-19</a> ; <a href="https://www.moneycontrol.com/news/business/companies/emirates-resumes-layoffs-fires-800-pilots-in-a-day-5524231.html">Emirates resumes layoffs, fires 800 pilots in a day</a> ; <a href="https://www.indiatoday.in/business/story/global-it-industry-india-mass-layoffs-weak-demand-coronavirus-1698199-2020-07-08">India’s IT sector may see mass layoffs as demand outlook remains weak</a> ; <a href="https://www.pennlive.com/business/2020/07/hershey-entertainment-extends-temporary-layoffs-for-more-than-600-employees-to-more-than-6-months.html">Hershey Entertainment extends temporary layoffs for more than 600 employees to more than 6 months</a> .</p>
</blockquote>
</li>
<li>
<blockquote>
<p>High growth startups are however a very different type of business. The point is to achieve the worth and scale of a well established company in a few years or a decade (Something that an established company would have achieved in many decades or in over a century even). For example, Tesla is now worth more than any other automobile company in the world, worth even more than Volkswagen, GM, Ford, companies around 100 years old. Amazon is worth more than any other retail chain, in fact many other retail chains combined. Airbnb is larger than many huge hotel chains. Uber is larger than any other taxi rental. How did these companies achieve in a few years that larger businesses took decades to do or probably could never even achieve ? Because they work in a different way. They invest in topline to achieve economies of scale / network effect, after which their unit economics is supposed to suddenly click. Lets try to break down the statement I made just before this, what is Unit Economics ? that is profit in every transaction. So for example, I make an Electric Vehicle for cost X, I will have to sell it for Y (Y > X) to achieve a profit. The more the value of Y-X is, more is the profit per vehicle, Unit Economics means Y-X > 0. High growth startups/companies will not wait to optimize bottomline to make Y-X > 0 to launch their product, they will start with maybe X > Y and pump money to scale. The entire plan is that at scale, the cost X goes down automatically, so beyond a certain point of market growth, the company should automatically achieve unit economics. This is driven by economies of scale and/or network effect, both of which are very well known phenomena in Economics. So the large sums of money these startups raise are used to pump more and more money to achieve growth to reach unit economics. So when a startup raises money A, it gets a target, to reach C customers by date D. An example would be startup raising in Feb 2020, 1 million dollars to reach 50000 Monthly Active Users by Feb 2021 raised by a company. The startup plans to pump almost 8000 dollars per month to achieve the numbers. What happens when pandemic disruption hits and startup does nothing? the startup will not be able to customers at nearly the rate they expected while they will continue burning money at the rate expected. Thus, the next round of funding will not be possible as the investor will only put money at 50000-ish MAUs. A sure shot path to the startup doing nothing shutting down in future. So, these companies acknowledge that they will be not able to show the growth, and will hence cut costs, such that whenever the circumstances become OK, they can come back to their old trajectory. They will still achieve lesser than what they were expecting in the start with the amount of money they have (because they are bleeding all that extra money during COVID19 despite a reduced burn rate and little growth), but at least the startups will survive to show growth. Cutting costs involves reducing salaries, layoffs, closing offices .. so on..</p>
</blockquote>
</li>
</ol>My answer to “What is the effect of the covid-19 pandemic on AI-based startups?”Patterns I Noticed While Getting An Ai Startup From Zero To One2020-08-30T00:00:00-05:002020-08-30T00:00:00-05:00https://muktabh.xyz/2020/08/30/Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One<p>In this post, I am going to document some trends, tricks and patterns I have derived from the Zero to One phase of my startup. I will try to broadly describe to you lessons I distilled while getting an Enterprise AI startup from nothing to its first revenues. First revenues are not success, they are necessary but not sufficient for success, so don’t confuse this with recipe for a Unicorn say. If and when we make it big, another post on “How to create a successful AI startup” will come up :) .</p>
<p>Also, please note that all premise here is quite egocentric, that is, it doesn’t take into account any discussions with other startup founders or many players in startup ecosystem. So, some of them might not apply to others at all. This is just me (not even my cofounders) trying to organize my thoughts around our journey, goes without saying this is my personal perspective and not an official stand of the startup I founded and work at. Also history doesn’t repeat itself, so assumptions which were true for me might not be true for you, so please a feel try to intuit the assumptions when you are reading. Another important point you should remember is that this article contains “one possible set of tricks”, not “THE set of tricks”. Its better to know one set of tricks than knowing none, but please know there can be a very different, even contrary path for a startup to reach from zero to one. All disclaimers done, hope my musings can help you in anyway!</p>
<h1 id="audience">Audience</h1>
<p>Audience of this post is me 5-6 years back when I was thinking of starting a business. So, basically a person with following characteristics should it most helpful:</p>
<p>1. Technology person, who has decided to start their own business seeing an upcoming (or existing) startup trend/ecosystem in their country. Attracted to it because they might have heard of people earning a lot or building cool tech.</p>
<p>2. Doesn’t know much about business except “Let’s build some cool tech that will sell itself”.</p>
<p>3. Outsider to the startup world. (That is you don’t know people who have done startups closely so as to take lessons from their life).</p>
<p>4. India based. Indians are quite different from the rest of the world culturally and there are things Indians observe/miss that others don’t.</p>
<p>5. You are not a super-exceptional team, that is not already famous before you started your company.</p>
<p>I will link definitions of startup linked terms in case you are such a beginner as described and aren’t aware of a few such terms. I did not know many startup-y terms when I started my company, I dont understand a few even yet maybe.</p>
<p>Now, even if you are more evolved/different than this startup-wise, you might still appreciate some points of the post, but you will find that other portions state the obvious. That is power of hindsight.</p>
<h1 id="big-picture-of-doing-a-startup--for-beginners">Big picture of doing a startup – For Beginners</h1>
<p>Let’s start with the basics first. Why did you get into a startup ? What are you really required to do when you are running a startup ? While for repeat entrepreneurs and people who come from a professional/social network of entrepreneurs would be very clear about this, an outsider is not. A 2014 version of me would probably not be very clear about some things here. If you read lot of startup literature, this might be a boring section for you as most stuff here is talked about a lot.</p>
<h2 id="why-start-up-">Why start up ?</h2>
<p>I did a startup because I wanted to work on tech that I found cool and also I wanted to be my own boss. That was the aim at least in the start. I think startup is an actually good place to get into if you have same aims as me. But as cliched as it may sound “with great power comes great responsibility”. Unlike in a day to day job, in startup you are taking up a lot of risk too. I cannot understate it here, if you dont make something good out of yourself in your startup, you will actually suffer loss and so will your near and dear ones and your early employees who trust you with their future. It takes sometime after you are in a startup to realize whether you were investing time and resources correctly or not. While there is a relived content type of feeling after seeing you have done relatively better for your people and your early employees, it also will be quite anxious a feeling otherwise. I will repeat it again, in early days of a startup, rewards are so sparse it is easy to confuse between a time period between rewards and pure inaction leading nowhere. You need to stay focused and stick to fundamentals during such confusing times, otherwise you might find that you have wasted time quite late. People generally try to understate the risk, getting secluded from social life, psychological hardships and stress, financial troubles and opportunity cost of people trying to enter the startup world as total noobs so that they don’t get discouraged. I don’t think you should think of the risk you are taking as soft, it exists and you need to be aware of it so that you don’t lose sight of your goal and lax out. It will be quite easy to lax out on the startup journey and you need to hammer it deep in your head that you cannot afford such a thing. That said, the upsides are great. I can ascertain that total absolute freedom to work in your style, taking decisions that actually change outcomes along the way and seeing your concepts change the world is a feeling that all the risk is worth it for. This feeling of achievement cannot be overstated. I assume when the financial gains reach you, it would be great too. (I’m not really rich yet so cannot comment how does that feel).</p>
<p>There are privileged people who do startups too. They can maintain good social life, life relatively comfortably even while doing a startup and will be shown in media as cool startup people. Don’t buy into the hype. Privileged people have more risk appetite and they can afford more failures and they can thus have many trials and need to get successful just at one. Probably that’s where the privileged founder narrative in the media comes from, more risk appetite is associated with better success, just due to the sheer number of trials and learning. For a lower middle class/middle class person (sp. If you are Indian), one failed startup is probably the maximum number of attempts they will get in this space, they need to make it count. Remember: “Make it count”. If you have a gut feeling not enough is happening, you are probably right, take charge and push and “Make it count”.</p>
<p>I think this section was more emotional than I intended to. Let’s try to come to more important business henceforth.</p>
<h2 id="what-is-a-startup-">What is a startup ?</h2>
<p>What is a AI startup ? If you are building an AI startup, you need to :</p>
<p>* Build a fast growing product business.</p>
<p>* Fast growing means you can show metrics on which you are getting better faster YoY or quarter on quarter. These metrics are kind of fixed : Number of paying customers and revenue in B2B businesses and number of active users in consumer businesses. Unless you are really famous already due to some reason (or rich in which case you fund your own adventures), odds are VC wont fund your technology, papers, patents or github stars. In India, the famous people are ex-FAANG people, people from Indian unicorns, serial entrepreneurs, Stanford (or Ivy League) educated etc. They will find it slightly easy to find really good money for doing lesser than non-famous people. At seed funding level, being educated at India’s top T-Schools like IITs and BITS Pilani (I studied there) has some advantages. VCs will (unless you are special) either fund your startup if you have a product doing well, or a product showing growth and they can see potential in.</p>
<p>* Product business means you are selling the same concept to all your customers. I mean you cannot sell soap to one person and toothpaste to another and matchsticks to a third person. The reason is, unless you have a product, you wont be able to grow fast as stated earlier. More so in AI as building proper sellable AI products takes time (I will talk about it a lot later in this post) and there is no way you can grow fast if you need to invest time to build for every client. This might sound obvious advice to people from elsewhere, but freshers doing AI startups would often feel they can do everything in the world and need to be aware about it.</p>
<p>* Try to focus on your core business and avoid distractions. There will be many. If you have a good AI team, as of now the field is still nascent enough for your team to basically build into anything possible by AI. So every possible Deep Learning enabled business might sound like a missed opportunity to someone good at training algorithms. What AI founders need to realize is that PoC is just the first step and substantial investment post that is needed to build a product. Developing AI for a PoC is simple, building one which runs in production is not. Unless they FOCUS, they will not be able to build a product and hence not be able to show growth which they require to get funded and grow their business further.</p>
<p>* Let me emphasize that I think there is a very good opportunity to build AI services business too. You can solve different problems for different clients and rent out your great AI workforce. But that is not something that is being covered on this post. I am trying to highlight tricks to build a AI product startup which can possibly be accelerated by VC funding. A very different approach needs to be taken there.</p>
<p>Story of all startups are different and one cannot copy playbook of one into another blindly. Different startups raise seed funding at different times, accordingly will have PoCs at different levels at time of seed funding, will evolve and pivot differently and thus will grow and raise money with different trajectories. I could recount the story of my startup here, but it would be at a different time, under different circumstances than other startups and hence to learn from story directly would either be an oversimplification or hard to relate. So I will list down things I think are invariants, will be needed in all AI startups without thinking about their path.</p>
<p>Unless you think you are really famous and can attract many rounds of funding just by your CV, I again urge you to stick to the fundamentals as much as possible. “Fast Growing” “Product” is what you need to build, stick to it and dont deviate.</p>
<h2 id="b2b-businesses">B2B businesses</h2>
<p>Enterprise businesses are basically B2B. Good classification of B2B businesses can be found here: <a href="http://christophjanz.blogspot.com/2014/10/five-ways-to-build-100-million-business.html"><span class="underline">http://christophjanz.blogspot.com/2014/10/five-ways-to-build-100-million-business.html</span></a> . An AI-for-enterprise startup is more on the elephant hunting side if we think according to the blog. That basically means, you have relatively fewer customers with large $ value. On the other hand, there can also be a B2B business that sells to many many customers but charges less $ per customers.</p>
<p>A utopia is a business like Slack (or Zoom) where you have growth like B2C business but you can charge companies as a B2B product. These B2B businesses become huge fast due to fast adoption at consumer level and then revenues follow as businesses pay. If you have an idea of a product which starts life as consumer and then makes employers pay, you can make it big real fast. That said, other business ideas need to be driven through inside/outside sales and marketing and dont rely on consumer based growth and network effect.</p>
<p>By the nature of it, a low $ product needs to be a simple one and a high $ product needs to be complex. If product is cheap, you cannot really have customer satisfaction teams and customer support. That means, you have to make a simple-to-use product UX wise and utility wise. The customer will have to adapt themselves to use the product and how well your UX helps them adapt determines the win in low cost high volume B2B products. OTOH, someone paying a high $ for the product will not be open to change their practices and will instead expect the product to cater to their way of doing things. That means AI-for-enterprise products will try to solve broad problems, will have to integrate with many other software, will need to provide some customer support and will need to adapt to customers. The take away is that enterprise products are more complex so as they can subsume different idiosyncrasies of large companies buying them, low cost B2B product need to be simple.</p>
<h2 id="ai-b2b-startups">AI B2B startups</h2>
<p>By AI B2B startups (I also use the term AI first startups to describe such companies) I mean startups which are selling AI tool or its output directly to their customers. I dont count startups here who have an already selling product and they are augmenting their main product’s capability using AI. For an AI first startup , the USP is their AI capabilities while for a company enhancing their product using AI, their USP is their pre-existing product. These are different beasts. A company for whom the product sells an AI algorithm or its output will need to develop very different capabilities. Apart from figuring out the regular stuff like Product Market Fit, Pricing, Product Development and Sales, they will also have to figure out building a good dataset to train AI on, getting good AI talent and creating/deploying AI algorithms that actually work. Essentially AI startups are like other SaaS companies but also have traits that are unaddressed by SaaS playbook. I will hopefully address some of these issues you face in the post as we go ahead. Some of the concepts I introduce will apply to other DeepTech startups too where you have to develop your own technology before you can sell it.</p>
<p><strong>If you are beginner thinking of starting a AI first company, stop and course correct if you tick more than 2-3 boxes below. If you have:</strong></p>
<p><strong>A. Low expertise in business domain where you want to sell AI in.</strong></p>
<p><strong>B. Low expertise in building Deep Learning/Machine Learning systems.</strong></p>
<p><strong>C. Cannot raise a LOT OF seed money.</strong></p>
<p><strong>D. Don’t have decent Data Ops/Analytics/tech capabilities.</strong></p>
<p><strong>E. Haven’t figured out AI USP of your product at your university (or if you are brilliant during your self study).</strong> Basically a lot of research work needs to be done by your team after starting the company. You dont tick E and you dont have to tick B automatically.</p>
<p>You can maybe make it work if you click over 3 boxes, but it will be hard !</p>
<p>We as a startup ticked A and E. We sorted out E somewhat by floating our own R\&D team and doing original research to build the good proprietary technology available and A by hiring business experts from within the domain we are selling the product in. However, that required funding $$$, setting up annotation capability to collect datasets and doing timebound R\&D to create algorithms which work. If there was one more point missing for us maybe, it would have been way harder to make it even to the first sales.</p>
<p>Low <em>expertise in business domain</em> is sort of guaranteed for a first time founder in their 20s/30s as you need to stay longer in industry to know it inside-out. Not saying no young founder can have the knowhow, but probability is small. One good way to sort out this point in early days of a startup is to have an equity compensated senior mentor or an experienced co-founder in the team. As the company grows, and your ESOPs get more repute, you can use them to hire domain experts.</p>
<p>Low <em>expertise in building Deep Learning systems</em> within founding team is another obstacle. Even if you understand the use-case well, you need one responsible person to make things happen. There are many people who claim they can create working AI systems, few who can even do it and most of these people don’t come cheap. The best is to have this person in founding team, the other alternative is bring in a well paid person (cash + equity) to get stuff done. This person should be responsible to figure out how the AI will work, how the technology and IP will be developed so that you stay abreast or ahead of the competitors.</p>
<p><em>Its bad to not to be able to raise a lot of money initially</em>. Raising good money is excellent at any stage of the company (of course not diluting yourself like crazy) a good guide here: <a href="https://www.saastr.com/benchmarks-in-saas-for-seed-and-series-a-rounds/"><span class="underline">https://www.saastr.com/benchmarks-in-saas-for-seed-and-series-a-rounds/</span></a> (In India, somewhat lower ticket sizes given low cost of running business). However, at seed stage, you probably will need to raise more for a AI company than a traditional SaaS business. Its good if your investor offers you a “nice” valuation for being an AI startup, or you will have to dilute extra equity if you are being judged as a typical SaaS (So its better for you to find an angel who is open to understanding how AI works than someone who purely invests on business metrics at seed stage). This extra money will be used to take care of many extra investments an AI startup needs. These are : A. Building Datasets to make your AI outputs better. B. Creating an AI team (and the cost of infrastructure required by it) which will create algorithms better than the ones available in public domain. This is your IP and USP which differentiates your company from another founder who decides to start a competitor with same or higher seed funding. TL,DR : Investments in AI are higher than SaaS to make revenue. I am not the only one that thinks so : <a href="https://a16z.com/2020/02/16/the-new-business-of-ai-and-how-its-different-from-traditional-software/"><span class="underline">https://a16z.com/2020/02/16/the-new-business-of-ai-and-how-its-different-from-traditional-software/</span></a> .</p>
<p><em>Data Ops/Tech/Analytics capability</em> is needed in a AI first startup just like any other SaaS. So its not just an AI team you need to solve everything. Right from day 1, you need to setup ops team to annotate data for your AI to train on. You also need to build product just like any other typical software product and have dashboards which show the client the needed information. In my estimate, there is an equivalent amount or even more of Data Engineering required as compared to the AI training to make AI work for a client. Very detailed analysis and conversation needs to happen when Data + Ops + Tech + Analytics + AI pipelines are being setup as these workflows will be repeated 100s of times during course of time. So its best to have these capabilities right when you start.</p>
<p>If you have already done <em>some research at your university</em> in field you plan to start a company in (or during the time when you were on a self learning spree) you have a starting advantage to differentiate your AI tech from a potential competitor . You also have brownie points when you speak to potential client or investor and you have some direction already about how would you setup AI and tech pipelines in future. A person who starts after setting up the company will have to figure out many things you have strong intuition about while on a timer. Thankfully for many of us self starters as of August 2020, a lot of smart talent from universities wants to go into FAANGs or established startups of the world (maybe because they have debt) and we have a window to get in and build from scratch.</p>
<p>Now that I have tried to address beginners with potential points I think they should be aware about, let’s jump to the core of the article : tricks to get from Zero to One.</p>
<h1 id="what-product-to-build">What product to build</h1>
<p>The first question any team will need to answer is what product to build. The answer will be quite clear to people who have one or more co-founders/mentors who have a deep experience in some domain. Somewhat clear to people who have pre-existing research and background from their university days. You might have seen that my startup had a deficit in both these when we started, so we had to figure this out the hard way. If you are in a situation like us, remember that <em>your early startup idea, the one which you start with, will mostly not work</em>. A third scenario where you are very confident about your idea is if you are replicating business model of another pre-existing company slightly ahead of yours in curve.</p>
<p>AI has applications in many fields : HR, Insurance, Banking, Retail, Healthcare, Defence/Law Enforcement, Manufacturing, Agriculture and many others which I might not be aware about. How to choose when your founding team doesnt have a specialization in one of the fields already ? There is just one way, that is many rounds of { <em>Market Research → Product PoCs → Customer Validation} cycle</em>. Before you think you should try the many (painful/unyielding) rounds of cycles, think if you can bring in a domain specialist in the team, this step can shorten the time period. You will have to spend some amount of funds/equity to try the cycle just like bringing a new co-founder, but a faster result can make bringing a cofounder worthwhile. However, good + experienced people might come very costly (equity/fund wise) and might not want to buy into the brand you have at early stages. You should prefer running a few iterations of the mentioned Pivot Cycle over bringing in a co-founder whom you doubt about being excellent at domain expertise.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-08-30-Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One/media/image1.png" alt="" /></p>
<h2 id="the-pivot-cycle">The Pivot Cycle</h2>
<p>The pivot cycle is to follow algorithm: <em>Repeat (Market Research → Product PoCs → Letting customers choose you)</em> until you are sure you are reaching early revenues. Just like the name suggests, its a three step algorithm run in multiple cycles to determine answer to one question : “Does the business idea pay as much its supposed to ?” or “Is the consumer utility as popular as its supposed to be ?”.</p>
<p>Very important to be clear about Pessimistic Criterion for success in allocated time period to judge whether an idea is worth pursuing in long run. You should be absolutely clear about it. “X <a href="https://baremetrics.com/academy/daily-active-user"><span class="underline">DAU</span></a> of avg session length T by end of MM/YY else I shut the business” in case of B2C or “Y <a href="https://www.zuora.com/billing-topics/monthly-recurring-revenue-definition/"><span class="underline">MRR</span></a> by selling to N customers by MM/YY or else business is not my cup of tea” is a concept you should have when you start an experiment.</p>
<p>Remember, there is an opportunity cost of pursuing an idea, which is, not working on a business you might be successful at. You will need to test each idea against a time bound benchmark if you need to be able to optimize in a space of ideas.</p>
<p>Its very easy to fall into the 10 year trap in a situation where you don’t know what your business idea exactly is even before you jump wholeheartedly into it: <a href="https://twitter.com/NavalBot/status/1280230191755902978"><span class="underline">https://twitter.com/NavalBot/status/1280230191755902978</span></a> . You might feel that this is such an obvious thing, you would need to be exactly sure what you want to do before you start but if that was the case you would not have heard of so many startup pivots. I think <strong>most</strong> first time entrepreneurs (I dont know about repeat ones) will figure out what their ideal business is only after a few pivots, however confident they are about their early ideas while starting. So you need to put harsh thresholds on ideas and cut/adapt ideas mercilessly to reach your ideal business. You should not get married unless you are very sure, to a person or to a business. Very sure in a B2B business is if more than one customers start writing recurring cheques for the same thing.</p>
<p>Another important thing which cannot be expressed as methodically is the sequence of ideas to be tried. At our business, we tried ideas sometimes very different and other times derived from each other. From a consumer app to different types of Medical Imaging AI to Retail AI to API platform to Social Media Analytics using AI before we found out what was the thing we could sell. You might want to keep the experimentation a bit lesser than that :-) . We also did experiments in parallel rather than one by one which I found effected focus and hence I recommend experimenting with ideas one-by-one. Some thoughts I personally formed on deciding on AI business ideas:</p>
<p>1. If you are thinking of getting into areas with regulatory capture (say healthcare, defence), you just dont need a domain expert, you also need government regulations expert in team. Just having the regulation cleared can be a massive barrier to entry. That said, clearing government norms is almost as much work as building AI and building and selling product. Best to avoid areas with government regulation unless you have very experienced team.</p>
<p>2. Low hanging fruits in AI, or things you can use a freely available Deep Learning model to solve, are generally thought of as commodities by investors (so early investors may often be confused as whether they should invest or not), but these might also be very solid and quick scaling business ideas if you know target audience to sell them. You might have to worry about your moat though.</p>
<p>3. If you choose the path like us that is an AI product in a large niche, your moat will be building specialized narrow R\&D capabilities and rich datasets. More on this later.</p>
<p>Also remember that framework that investors think in is different from what entrepreneurs (techie people specially) think in. You might need to develop more empathy towards investors and how they function. So, let me define the early life of a startup in stages :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-08-30-Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One/media/image2.png" alt="" /></p>
<p>While I am speaking here about how to get through the pivot cycle and figure out the most important things according to me, idea and execution, VCs will almost always be more interested in looking at “Business Practices” or “Repeatability in Business”. This is just the next step after finding out the idea, which is making the startup success replicable for growth stages. So while in the Pivot Cycle, you will run experiments to figure out 1. The Product and 2. The utility, the investor will also be interested in knowing a third thing beyond 1 and 2, whether you can easily prove the utility to more and more people. This repeatability in business requires A. setting up salesforce in form of digital marketing, inside or outside sales and B. creating a financial model for your startup, which you need to do only after you finalize the business idea you want to pursue.</p>
<h1 id="iterating-the-pivot-cycle">Iterating the Pivot Cycle</h1>
<p>Let’s try to understand one iteration of the pivot cycle. The steps in one cycle as I said earlier are as follows :</p>
<p>1. Come up with a budget, an idea and a reasonable pessimistic time bound target for the idea.</p>
<p>2. Do market research about the idea before you invest in it, you should do it along with step 1.</p>
<p>3. <em>Build the product and sell it to N first clients. {Whoa!}</em></p>
<p>4. Try your best to achieve metrics you have set as targets and take a strict non nonsense call at the end of the time/budget predecided.</p>
<p>While 1,3,4 is something one can think of as definitely possible in a fixed timeframe (finite one time tasks), the feasibility/ease/hardships of building an AI Product and selling it to first N clients in a fixed time budget is hard to wrap ones head around (specially if they dont have experience building selling a product). Let’s for example say possible goals can be 8-12 months to build and sell an AI first product from scratch for $5000/year to 40 clients (SaaS) or for $70,000/year to 3 clients (enterprise). Beginners dont really have a standard to 1. set such goals and 2. compare whether the goal set is hard or easy, feasible or infeasible. This is an interesting phenomenon that humans can intuit, internalize and estimate quantities well when they have an inbound meter/category to compare against : <a href="https://youtu.be/NNnIGh9g6fA?list=PL150326949691B199&t=495"><span class="underline">https://youtu.be/NNnIGh9g6fA?list=PL150326949691B199\&t=495</span></a> (Check 5 minutes of the video from the timestamp I link here to get an idea of what I am trying to share, the whole video is very interesting though). If you are a beginner you can safely assume that either way you guess feasibility of goal set wrt point 3 above(say 8-12 months for such a target should be chill or this should be hard) based on your optimistic or pessimistic nature has no data point attached. I myself personally was clueless about good benchmark to set to take decision on an idea when we started our company, “When is an idea good enough to pursue as the product of the company?”. So temporarily while you read this section, you will have to live with my measure of feasibility/not-possible of a goal you can set for a business idea. We did a few iterations of the pivot cycle in our startup before early revenues and thus my judgment of feasibility is based on these 4-5 datapoints. From my experience 8-12 months is ambitious to build an AI product from scratch collecting around 250k US$ in Annual Revenue and is a hard target to achieve. You will need to hurry from day1 and take shortcuts and maybe keep the maximum horizon a bit longer per experiment than 12 months (say 15-18 months per idea, total 2-3 iterations of Pivot Cycle in 3 years if you can stretch your seed funding for that much). These numbers are based on markets which pay slightly less (Asia for example) and so your equivalent goal in North American market will be say around 500k USD of annualized revenue in same amount of time.</p>
<p>Conceptualizing, building and selling the product in a fixed time needs you to work very differently (sometimes in an non obvious way) as compared to when you are selling a product whose <a href="https://en.wikipedia.org/wiki/Product/market_fit"><span class="underline">Product Market Fit</span></a> (PMF) has been achieved. When we observe sales or product management practices of evolved/famous companies around, we generally see the sales and products of companies after their PMF. It is a very bad call to compare a new startup you are going to form where you are not yet sure about the idea with a company which is in growth stage or at least ahead in their PMF journey.</p>
<p>Let me explain why. In the early stages of your idea, you are trying to solve a complicated mess of <a href="https://en.wikipedia.org/wiki/Catch-22_\(logic\)"><span class="underline">chicken-egg problems</span></a> or dead ends. Please try and appreciate the following dependency graph about planning in an early AI startup :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-08-30-Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One/media/image3.png" alt="" /></p>
<p>Unlike in Product Management of a more “stable” startup, its very very hard to plan in detail all aspects of a AI product very early on if you are going to run a pivot cycle because there are things you cannot quantitatively estimate (look at the cannot think further symbol in the diagram above). You get slightly better with each pivot, but there will always be open ends. Every pivot will need all of technology building, product building, setting up data ops and closing first few sales in time bound manner, which effectively means doing things in a scrappy way. As you can probably realize, perseverance and pragmatism are two skills first time entrepreneurs should get better at to survive the pivots. This is quite in contrast to if you are experienced and know exactly what to target, that’s why I suggested if you can get an excellent domain aware co-founder if possible, you will have to struggle less. However, if this domain expert cofounder makes error in identifying the problem to solve, it is going to be really hard to do the pivots with all the new constraints. Pivot cycle requires you to take hard decisions, cut things and burn bridges after the time of an idea runs out. Someone whose reputation is on the line might find it harder to do so. There have been times when I said no to a client who came back after a very long time and we had pivoted the idea because it did not make the cut, very unfortunate and painful but cannot help it really!</p>
<p>My lesson from being in a soup of open ended problem is : “Don’t strive for perfection. Strive for survival.” Introducing our friend Small Wins : <a href="https://www.semanticscholar.org/paper/Small-wins%3A-Redefining-the-scale-of-social-Weick/3c45ee6989cfe84f1f4866e26dbe7fae93de26b8"><span class="underline">https://www.semanticscholar.org/paper/Small-wins%3A-Redefining-the-scale-of-social-Weick/3c45ee6989cfe84f1f4866e26dbe7fae93de26b8</span></a> . Small wins is a political concept which says that you dont need to solve the entire problem which overwhelms you, just figure out the most important set of subproblems and focus on them. Basically, your aim should be to turn people’s opinion from “I don’t think what you are trying to do is possible” to “Cool idea you have got there, but that’s not how its supposed to be done” or better “Here take my money and solve your s**t by doing ABC”. Once that is achieved, there is better chance that an aggregated and more ambitious attempt will be made to solve the entire problem. I will of course tell what the important subtasks were which we choose to solve in our startup first, but please note that these focal points might be different for different startups based on their team, business and investors. In the initial phases of the enterprise AI product idea, the following points are what we gave more importance to:</p>
<p>1. Optimize for getting cash in the bank fast. That proves your business idea has utility.</p>
<p>2. In light of 1, build initial versions of products to make sure that you can deliver best results fast to early clients. Dont go for premature optimization, remember you are not even sure this is the idea you will be working on if it doesn’t prove itself.</p>
<p>3. Run Business Development in parallel with Product Development if you want to achieve the time bound goals.</p>
<h2 id="building-the-initial-versions-of-product">Building the initial versions of Product</h2>
<p>Ok, so now you have decided to try out an idea in the pivot cycle. How do you go ahead with it ? Here are a few ideas/suggestions from me. I think there are three important themes that an AI entrepreneur needs to think of while developing the product :</p>
<h3 id="enterprise-product-vs-enterprise-utility">Enterprise product v/s Enterprise utility</h3>
<p>This is probably a relevant point only for enterprise-serving startups. I cannot imagine if and how other startups can use this hack. The hack arises from the complexity(and thus high ticket size) of fully-functioning enterprise product. Let’s try and understand why enterprise products are usually more complex. In a consumer software, consumers typically pay nothing and hence they will be willing to adapt and change their lifestyles around your product. That means you can design and make simple products without trying to customize it for each consumer’s lifestyle. In fact, it is better than the products are simple as you cannot do consumer support at all and hence they should just “get it”. More complex products with more features might not work just because users have no one to explain it to them. Typical SaaS ticket size products are slightly more complex to address some functionality at the cost of some complexity. The users pay small amounts and unlike consumers are more convinced about the utility when they start using the product to digest the complexity that comes with enhanced functionality. That said, you still dont do customization at client levels in small ticket-high volume SaaS. An enterprise OTOH thinks differently. Enterprises evaluate products on the basis of perceived utility they will deliver. Two important things you need to remember:</p>
<p>1. Generally, if an enterprise wants to buy a utility, it will be very hard to sell a subset of the utility just your product solves. For success, you need to solve enterprise’s problem rather than just selling your product.</p>
<p>2. However, enterprises will typically pay way higher than say an individual paying for SaaS because they need a lot of customizations in the way of utility they are procuring and they understand its hard to deliver all that. The customizations help them show results of using a new innovation quickly.</p>
<p>There is a threshold utility (which is generally quite high) below which enterprises dont want to procure a solution. This threshold utility often means entirety of the usecase they associate with your product and minimal change to an existing workflow they have. So for a document processing AI startup they will want a startup to automatically take data, train and run AI, process it, send it back to their system and automatically show dashboards informative to their stakeholders. Not just that, even in the data processing, they might need some AI algorithms specific to their own usecase apart from the generic ones you might have built. Net net, the utility the enterprise will ask for will be a superset of what you will be taking to them in initial stages. Think of 2-3 enterprises you are trying to sell to in parallel. Most of the time, they will have some overlapping threshold utility and some non-overlapping parts. If you build the entire threshold utility for each client inside your early product, your product will be optimized to serve just one client. That should not be done, your early product should be versatile and nimble that it can fit in use for all your early clients. Your early product should be the overlapping threshold utility part of your early clients.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-08-30-Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One/media/image4.png" alt="" /></p>
<p>Now I have stated three points:</p>
<p>1. The early product should have the intersection of threshold utility of various early clients.</p>
<p>2. An enterprise client will not buy product unless their threshold utility is fulfilled. So you need to fulfill threshold utility.</p>
<p>3. The aim in the pivot cycle is to quickly sell to first few clients and get money in the bank.</p>
<p>There seems to be a gap here. How to sell when you are only building an early version of product satisfying part of threshold utility. This is where the hack is. Enterprise products should be relatively high ticket size and you would need a customer support team. This team typically consists of analysts, analytics professionals, developers and QA team. While in long term their role is to see that the analytics is running and AI output being sent to client has no errors, in early phase of startup you can additionally use their help to fill in the subset of threshold utility that you are not incorporating in your early product. Basically, while you build a core set of capabilities wihin your product, you invest somewhat more in a relatively large customer support team which builds custom modules to bridge gaps between your product and the expected utility for the client. What is product and what is custom modules ? I understand it wont be clear now. Let me try to show what I saying by taking example of the document processing AI product I was mentioning earlier.</p>
<p>Let’s say that our hypothetical document processing AI <em>“ProcureDocs AI”</em> product uses NLP to:</p>
<p>1. Highlight potential hotspots of a procurement documents. Places where one needs to read, reread and give more thought.</p>
<p>2. Detect possible objectionable clauses by/for a vendor in procurement documents.</p>
<p>[I have no clue about problems with Procurement documents and so all the specs above might be laughable when you look at the market, as long as you can understand that there are some specs for the NLP engine to achieve, we are fine, I did not intend to show anything beyond that]</p>
<p>So lets say your initial clients are a large mining firm, your local city council and a law firm that uses your product to enhance its services. All potential USD 50k/year deals. However, the following is what they want as their threshold utility to use your product :</p>
<p><img src="https://muktabh.xyz/assets/img/2020-08-30-Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One/media/image5.jpeg" alt="" /></p>
<p>Nice, so first of all let me define what I call as product and what I mean by custom modules . Product is the set of things you develop which are generic enough to cater to different clients. So if you want to run a new client’s data through your AI product without functionality of the product changing, you will have to do minimal to no development. The components of products are regularly tested and developed to scale as the clientele and usage grows. So suppose you have these 3 early clients, one way to solve things would be to just add every required feature into the product. That won’t be possible however (2 reasons) given A. You will not be lucky enough to start product development after fully understanding the specs for all your early clients, while deployment will be going on for one another one might be in PoC stage and another one in initial talks phase. B. Developing things which can generalize across any number of clients takes time, esp the integration part. Think of creating a dashboard for everyone who wants to use your product : generic, can be utilized across all possible clients, all the stakeholders in each client firm ; this will require a lot of time and iters to build. The more components you build to be used across clients (that is as a part of core product), the more maintenance they want and they reduce the product’s adaptability. So if you include all early client specs into the product, you will end up either wasting all the time budget you have allotted for one iteration of Pivot Cycle into balancing between requirements or end up making one mini product for each client if you want to achieve time bound sales goal. Both are bad scenarios and slow, the latter still probably allowing you to make a sale in the time budget. The best solution I can think of is diving the specs into core product and custom modules.</p>
<p>Early Product should have things you can be reasonably sure that will be useful across all early clients you have. These will be your core AI modules (NLP inference pipelines that you have built), or maybe some way to use different Machine Learning pipelines using same interface. So in our example above, you will have inference for Item Detector, Price Detector, vendor name detector, Requirement Detector, Ambiguity/Unusual language classifier etc in Core Product. You can have different trained model for each of these algorithms, but they can be designed to be used by common interfaces in the core product. So, you can also build higher order interfaces like a detector or a classifier where you can fit any specific model while inference. So for example a classifier interface in code can be used to detect both unusual language and requirements when different models are loaded. We also need components to host AI models as services, run different type of workflow based on configurations, annotation architecture to create training data etc as part of the early product. Essentially the idea is, you put up a configuration file for a client containing workflow and weights of models trained and your product can process documents related to that client. The early product will also include basic I/O like say JSON input files as input and JSON as output. If you are lucky and most of your clients want similar I/O, you should be able to have integrations as a part of the early product too. Requirements that do not fall under the core product specs should be developed as custom modules for clients in early phases. So basically module to automatically email output to one of the clients, automatically read files from fileserver of another client, OCR to convert images to text documents, dashboard for one client, Word to JSON conversion and other such things are better written as custom modules at client level to quickly be able to process their data. Writing generic versions of so many utilities will take too much time to plan and then build so that they co-exist with one another. Time is of essence as you are still trying to figure out whether this product works. So you have a product team building things that become generic across clients and maintaining and scaling components, so that, you don’t need a mini product for each client, there is a lot of functionality you build using your delivery team, quick and dirty, to make sure that you are able to satisfy threshold utility of the clients without compromising the product’s adaptibility. You are betting here that there is domain specific data about client integrations and non-essential AI/tech features (right now being built as client specific modules) that you will gather along as you sell to more and more clients and include them in product later if need be, but for now you are trying to keep the product minimal and sell as fast as possible. Only the core features go into the early product.</p>
<p>Another thing you might ask is whether having a core product is even necessary ? We are just testing an idea here, why not just build separate set of “modules” for each client and sell them fast ? Why to even keep even a relatively smaller set of common functionality ? Apart from ofcourse less copy pasting code, more maintainability and less fuss while being deployed (Remember you just dont have to make code run once, you have to keep it running for the first revenues to come in), this also helps you to think hard and define the invariants of your products. These invariants make a product company different from an enterprise services company. A enterprise services company will not say No to most projects within their circle of competence, a product company will say No to projects not fitting these invariants. Also, according to me addressing these invariants will bring some structure into the first few deployments making them fast, as you are solving a recurring problem. Faster deployments will help you make a decision in the time budget. You dont want to waste time by preparing for circumstances you are not sure you will encounter, but for the pattern of problems you encounter frequently, you should reduce down the complexity so that you can delegate them and dont need to solve them twice or thrice. Let us take examples of invariants that you get as components of the early product of ProcureDocs AI. Invariant components of this product will turn out to be, at a very high level, entity extractors and classfiers, and then more specifically, you will have entity extractors like Item Detector, Price Detector, vendor name detector etc and classifiers like Requirement Detector, (classifies a paragraph say into requirement/not) Ambiguity/Unusual language classifier (classifies things as ambiguos/non-ambiguos) and so on. Once these invariants are set, other members of your team take responsibility of working on individual components and improving them. When I tried to Google hard about what such invariants are called in Product Management lingo, I found that a closely linked term is Product Architecture : https://www.productplan.com/glossary/product-architecture/.</p>
<p>What you have done in this step are not rules set in stone for the product. Once you are reasonably sure about product, you can choose to invest in the future than solve for the now. But, when you need a small win on a time budget, your risk appetite should be low and you can do some of what established companies would avoid as short-termism.</p>
<h3 id="building-the-early-core-product">Building the Early Core Product</h3>
<p>Welcome to the second layer of the product onion. While you probably now are convinced by my premise that you need to have a core product and custom module for catering to enterprises, here is some more discussion about the core product. It isnt over yet ! Unlike the previous section on Enterprise Utility, this section is applicable to all sort of AI first products, so if you are a SaaS or consumer product in AI, this section would still be relevant. Few things you should consider here are :</p>
<p>A. Solve problem(s), dont just build an algorithm.</p>
<p>B. Dont optimize prematurely.</p>
<p>C. AI products follow Prototype → Demo → Annotate → Build → Feedback process. Dont wait for AI to get perfect before you sell/luanch.</p>
<p>So first premise is, dont start from Deep Learning algorithms when you are building the product, but rather from a problem statement. In our Procuredocs AI example above, dont start thinking like, “NLP has classification and language models, now what can be done on enterprise documents related to procurement ?” You need to take a real world problem (rather problems) as a starting point, which people actually want to pay for and plan your AI layer on top of that. Understanding what real problems exist on an enterprise dataset is what the Market Research step of the pivot cycle tries to find out. Now for all possible problems existing on an enterprise dataset (procurement documents for our hypothetical ProcureDocs AI), your Data Science expert needs to think and decide the problem(s) to solve that : 1. Have the largest TAM and 2. is/are feasible using existing Deep Learning/AI tech. Given you dont have research resources of Google and dont have pre-existing research from your university days, you will need to depend upon existing research a lot, at least for early versions of products, before you develop your own R\&D in product’s domain. So you need to figure out what all problems on a dataset are theoretically solvable given you had a large dataset at your disposal for training AI algorithms. Remember a real world problem can be solved with a combination of AI algorithms, rather than just one. Foor example, ProcureDocs AI can use different models to recognize sentences with ambiguous requirements and detecting line items and their prices.</p>
<p>There are startups which try to solve problems using AI which have no previous research done on them and maybe not really technologically feasible. I dont know how do these startups really solve them. When we are choosing problems the startup will need to solve, we need to keep in mind that there is a reason that some categories of problems don’t have feasible/working solutions in existing world. You may be able to solve it by creating totally new research, but when you are trying to evaluate an idea in a time bound way, its not plausible. More on problem selection later.</p>
<p>Second point is that you need to avoid falling into the trap most Product people want to fall into. Over optimizing product or running behind perfection. Trying to make product scalable/efficient/generic/pretty/easy to use (.. and 100 other adjectives which PMs would like to list on their CVs..) are useful efforts only after you are sure that you are going to stick to and sell a product. You are probably building something which 0 or 1 or <5 companies have built in the world, or it might not be even feasible to build. Rather than building the best possible early product, the best use of efforts is to just figure out an ugly, inefficient but feasible and fast path from just an idea to early $s in MRR. Once you achieve that, you can work on all the other optimizations. If you waste precious time from your idea time budget optimizing for any of the adjectives and in fear of lower margins for first few clients, you might never be able to get early clientele you want for the product to actually stick around and run. If you believe that perfect products can be designed in first iteration, you need to think about the early beta releases of software products you use now. Were they as good as they are in thir recent versions ? Mostly No. Let me introduce you to Mr. Gall ( <a href="https://en.wikipedia.org/wiki/John_Gall_\(author)"><span class="underline">https://en.wikipedia.org/wiki/John_Gall_(author</span></a> ), who says that most successful/awesome complex systems are design improvements of other less sophisticated systems. Very few awesome things were developed in the first epoch. So dont optimize prematurely, focus on your aim during pivot cycle, validate the idea ASAP.</p>
<p>The next point is dont wait for the AI to become perfect before you first approach customers. In a limited time/money budget, its hard for you to 1. Collect enough Data, 2. Annotate data and 3. Do R\&D to invent the state of the art algorithms to get the perfect AI algorithm. If you are waiting for AI to evolve to the level when your product will be in production, before your first sale, I think you are just trying to be in your comfort zone. Customers are buying the AI you will deliver in the long run and not what you have when you speak to them for the first time. All you need to start working on making the first sale is some AI magic that you can show the customer (that might be AI working on couple of simple images or documents for our hypothetical Procuredocs AI), however you quantify ‘some’ and ‘AI magic’. These early AI magic results or Prototype as I call them in the Prototype → Demo → Annotate → Build → Feedback process is what you need to demo the AI to client first. Once you demo your product, you setup Annotate → Build → Feedback for the remaining round of rollouts and deployments, where you “annotate” more client data, “Build” that is train deep learning model and deploy and then taker errors made by the Deep Learning models as “Feedback” to create more training data and make the underlying models better. Remember, for now we know that no amount of clever training tricks and hacks can beat a Deep Learning model trained on large volumes of data. The more data you get feedback on and feed to the AI model, the more unbeatable your deployment for the client becomes. However, this is a journey you will have to take by setting expectations of the client and working towards increasing accuracy of AI models, you cannot have the full-blown AI ready on day one.</p>
<h3><img src="https://muktabh.xyz/assets/img/2020-08-30-Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One/media/image6.png" alt="" /></h3>
<h3 id="the-startupy-terms--pmfmvp-and-the-product-adaptability---efficiency-tradeoff">The startupy terms : PMF/MVP and the product adaptability - efficiency tradeoff</h3>
<p>You will come across the terms : Product Market Fit and Minimum Viable Product in traditional SaaS. How do these terms measure up in Enterprise AI ? According to me, MVP and PMF are not really points in startup timeline but rather continuums. You start developing a PMF the more of your MVP you develop. Enterprise products are just too complex and the threshold utilities so non-intersecting that thinking of developing a product that satisfies demands of all clients in the beginning before you start selling is [what I feel most people think of as MVP] is just hard to even think of. These continuums start from the Pivot cycle stage and continue to <figuring out repeatability in business> stage of the product. I would rather want to think of the product evolving from an adaptable product (in pivot cycle) which can cater to first customers for getting quick early revenue to an efficient one (if it graduates to the repeatable business stage from pivot cycle) around more common usecases for maximizing margins. You start getting closer to your MVP as the product starts getting more efficient and your Product Market Fit starts somewhere when you have achieved a certain level of efficiency and MVP. To be specific, PMF starts when you know that there are clients who will buy but you have to make product more efficient.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-08-30-Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One/media/image7.png" alt="" /></p>
<h2 id="selling-the-product-for-the-first-few-times">Selling the Product for the first few times</h2>
<p>In this section, I will talk about some patterns I figured while selling product for the first few times to early customers. I think there will be disagreement/difference of opinion about initial sales based on founders’ personalities and how long they commit to try an experiment out in their pivot cycle. So disclaimer right now, your mileage may vary.</p>
<h3 id="there-is-no-perfect-market-research-or-maybe-just-one-way-to-do-it">There is no perfect Market Research [Or maybe just one way to do it]</h3>
<p>Other alternative headings can be “Always be ready for surprises in early phase of business” or “A map is not the territory”- <a href="https://en.wikipedia.org/wiki/Map–territory_relation#"><span class="underline">https://en.wikipedia.org/wiki/Map%E2%80%93territory_relation#%22A_map_is_not_the_territory%22</span></a> . A beginner might ask the following questions if they have read the essay till this point: “Even before building a product you should have done market research and confirmed that clients should pay for it right ? Why do you need a Pivot Cycle at all then ?”. Also many people might have the image that your sales method should be sealed the day you take feedback from perspective clients because you have already figured out a way to build a pipeline by how you lined up these feedback interviews. “If I do perfect Market Research, I should basically be building an invincible product and sales methodology” might be another thought people would have while building a B2B/Enterprise product.</p>
<p>I personally believe that perfect market research is not possible (You can just avoid the Market Research step in case your team has lot of experience. I will talk about this scenario later). Let me try to convince you about my opinion before I start explaining you what you mostly cannot have it all figured out before you start. How many entrepreneurs do you think make the massive blunder of trying out an idea without proper market research ? It is definitely below 73% in my opinion. Try checking with your fellow entrepreneurs, most I know did market research to the best of their ability. However, it seems what people initially imagine and plan for their business to be rarely happens : <a href="https://actu.epfl.ch/news/where-to-play-a-practical-guide-for-running-your-t/"><span class="underline">https://actu.epfl.ch/news/where-to-play-a-practical-guide-for-running-your-t/</span></a> . 73% of startups pivoted in a 10,000 startups study by EPFL. According to me there are three reasons for it : 1. Many facts you think you know about an industry when you are not as experienced, are actually just assumptions, not real facts and assumptions can be wrong. 2. People (both entrepreneurs and their contact points) can easily overestimate themselves and their capability to execute and 3. Many customers dont know what they want, so the initial feedback you collect about ideas has a low signal to noise ratio.</p>
<p>In enterprise AI, there are added factors :</p>
<p>1. AI as a technology has limitations. However, the status quo changes quickly and replaced by less-restrictive bounds. Its hard to estimate what progress will AI make in a limited timeframe. So when you are doing market research there is a very real possibility of under/overestimating AI capabilities.</p>
<p>2. There are no well researched and tried recipes to set AI businesses in motion. Many business people dont understand AI well and many AI enthusiasts dont understand business well.</p>
<p>3. Movies and MSM sensationalize news about AI, you will find extremely high expectations or paranoia more than you would expect.</p>
<p>So good market research and customer profiling will increase the probability of success of an idea, but you can never be sure. Except in one case : when you are copying an existing business model and your founders/important team members come from a competitor. If you are lucky enough to be in such a scenario, you dont even need market research. Just copy and build one advantage over the competitor.</p>
<h3 id="early-customers">Early Customers</h3>
<p>Probably the most important event for any B2B company is the time when they figure out who are going to be their early client(s). Good early customers are a must for an idea to move from a concept to some kind of business. Remember the figure above where there were too many open ends when you were trying to decide how to build and make your first sale. A good early client will help you make it slightly easy to navigate through that maze. We were lucky in our startup to get some extremely good early clients and thus could make the first few sales along with product development. Some points I would like to suggest about early clients in case of AI startups :</p>
<p>1. Start searching early for your first clients. Dont wait to build the entire product. In the Prototype → Demo → Annotate → Build → Feedback process, you should try to get early clients around demo step, maybe even during the time you are building the prototype.</p>
<p>2. Your early clients need to be senior people. Maybe a top position at a company, director of X or VP of Y type designations (in large organizations for an enterprise product). Dont fall in the trap of talking to even slightly junior people. You need a very capable and experienced person to A. Understand the product vision of a new product and more importantly B. help push a totally new technology without any references into a company, just on pure merit.</p>
<p>3. It helps if your early client is technologically aware. Even better if they are enthusiastic about AI. They can understand constraints and give accurate feedback about product and how to sell it.</p>
<p>4. Another very important thing is the willingness and patience of the client to review many iterations of the product and try to guide you with how much better your technology needs to be to make the cut. Very very few people apart from your early customers can help you with this type of data.</p>
<p>Infact, in some ways, if you just solve the step of getting good early clients, that is all you need to do to make your first few sales. Everything else you will be able to figure out along the way.</p>
<h3 id="dont-setup-a-sales-team-right-from-day-1">Dont setup a sales team right from day 1</h3>
<p>Another very important observation. Early sales hires are not going to be able to do anything. The first few sales the company makes are very different from how its salesforce will work later. Your company in the long run, should use outside sales (where your salespeople go and meet senior executives) or inbound sales (where you use marketing to create interest and get customers to approach you rather than you approaching the customer), as both the methods optimized to sell product at scale. But in the case of first few customers, the story will be different. The first few sales will be glacial, where you will be building different components of your products demoing and taking feedback from early clients until you have something good enough to sell. So selling to first few customers will not be optimized for scale but survival. Later, there will be a time where you will have to put thought into increasing the speed of sales after you are reasonably confident that you have satisfied the usecase of your early clients. Early sales are somewhat like how a door-to-door salesman sells, that is you will have to build trust, demo it and then only someone will buy your product, but with added complexity that you are creating components of product while making the sale. Examples of such inside sales process is abundant in IT services companies. However, IT services companies scale by using the trust earned in the first sale by upselling more services, which is a path a product startup cannot take, requiring them to make a switch to other sales methodsafter early customers. In fact, the indication of an idea graduating the pivot cycle and becoming THE product for a startup when the company starts thinking about scaling up sales and getting frustrated at how slow the initial inside sales process works.</p>
<p>All you need to take away from this section is that if you hire sales people day 1, they will not be able to help the business as startup sales professionals are typically trained to sell products at scale via outside sales or inbound sales. So founders will generally need to make the first few sales themselves. This will require them to resist the pressure to grow super fast in the pivot cycle and invest into understanding usecase deeply, solving it and getting the first $$ into the bank.</p>
<h2 id="running-the-team">Running the team</h2>
<p>In this section, I will speak about a few things I observed while conducting the team. To be very truthful, when I started as an entrepreneur, I did not really believe in when other (very successful) ones said that building a good team is very important for the startup. That is because, in early phases of idea, a founder themselves manages lot of complexity, product, sales, tech etc. and they feel that they will be able to grow just using their personal ambition and force of commitment. Maybe that is why I felt earlier that all you need is good founders and some team which can do work. However, as the company grows and founders start becoming bottleneck, you start understanding why team building is extremely important. Like most other things in this article, this lesson was learnt the hard way. You need a motivated, good, solid team and also you need that strong founder instinct and then maybe you will succeed is what is my understanding now. You have 24 hours in your day and maybe you work with the highest efficiency x units/hour and still you will have upper limit on capacity. The work of a founder will quickly expand to fill all their time. When the company is scaling up faster than how fast you increase your productivity and you are all tied up and still more is required, there is no option but to have a team that can rise up to the occasion. My thoughts and lessons I learnt running an AI team in following headings :</p>
<h3 id="adventure-loving-and-responsibility-loving-attitudes">Adventure-Loving and Responsibility-Loving attitudes</h3>
<p>Tasks of every team in a startup has two components : Adventure and Responsibility. In product team, you need to make sure about reliability and test coverage and uptime and adding features which sales team demands, things you absolutely need for putting bread on the table. This component of work of product team I would call responsibility component of their job. Then there is scaling up of web services to serve twice the number of requests, making query on database 2X faster or making sure image are transferred faster to websevice from client are type of tasks I call as the adventure side of their job. In AI team, you have regular training of models to make sure newly discovered image categories are accounted for, updating NLP models with new upcoming text, updating different models for different customers, new annotations on data to increase accuracy of existing methods etc are what I think of as Responsibility side of their job. AI team can call thinking of methods to deploy models using less resources, developing new AI algorithms and training methods as adventure part of their job. Let me also extend this analogy to business team as well. Regular client calls, follow ups, making decks better, contacting and onboarding new clients, making sure delivery and client relation stays good etc. are part of Responsibility side of their job. On the other hand, getting on client calls to push for closures, exploring new products and a few other things can be thought to be adventure side of their job. I hope those examples help you intuit about the two type of tasks. To give it some kind of definition from my perspective: adventure tasks are totally open ended, that is the only thing you need to know about them is the goal needed to be achieved and then you figure out the way, while responsibility tasks have more structured paths with obstacles along the way to overcome. Responsibility tasks require handling some open ended complexities to sort out a well defined goal in a fixed time period, so it requires more of diligence and problem solving. Adventure tasks require more of risk taking and problem solving. So why such a long paragraph to convince you about this dichotomy ? In my limited experience, I have seen that people have preference towards one of these type of tasks. So if someone is trying to solve a problem, they will try to view it in the lens of Adventure like tasks or Responsibility like tasks. Because there are preferences involved, one type of people will view the behavior of others as too risky or stuck in the rut. <em>This is a good struggle to have in a startup.</em> You need both type of people who would use their respective forces to shape the journey, business, product and AI of startup into a halfway non-extreme path. Generally the best path is a combination of two thought extremes. When the pivot cycle begins, everything is an adventure like task and so adventurous people will basically be leading things more, but as the company figures things out and grows, adventurous tasks will reduce in number and increase in complexity and consistency tasks will take over the rest. There is never a dearth of adventurous tasks but you need to know that consistency needs to prevail in most parts of a successful organization for adventurous people disrupting smaller harder-to-crack bottlenecks of it. Adventurous-task loving people will have to thus learn to relinquish control over things which they controlled initially and move to harder problems to solve.</p>
<p>Now, humans have a bias towards admiring the risk taking dimension of character more than their consistency. So people who are risk taking get more psychological rewards than responsible ones. I feel that probably people become more risk taking because either they are conditioned to feed off this adulation or they love the adrenaline. So in AI team, there will be people who will always try to invent new tricks and publish new papers or write a deployment framework which makes deploying your algorithm 20% cheaper. This gets them somewhat more of a fame both within the team and sometimes even from outside.</p>
<p>Then there will be people who will get the day to day work done, run the algorithms through client studies, see where the algorithms were not working well and try to address the blind spot, train on newly data collected etc. These responsibility seeking rockstars are not praised enough. They thus might feel that they are working on irrelevant things and sometimes feel bad about their jobs even. Now of course if one is an adventurous type of person stuck in a role requiring too much responsibility, they should and might feel trapped, but I have seen people being really good at consistency/responsibility and not very willing to jump on open ended problems or less charted paths feeling bad about their job too. That is because we have probably built a world based on television and twitter and facebook where instead of encouraging adventurous type roles, we have started shaming responsibility type roles. If you dont work on an open-source project you are a bad engineer or the real salesperson is the one who closes the sales type of mentality makes our consistent folks feel incomplete for nothing. You are just different type, not inferior ! So many excellent responsibility-preferring people really good at their jobs live hating themselves due to groupthink.</p>
<p>The truth is both type of people are important in an organization, probably more responsibility seeking people than risk takers in established ones and the other way round in nascent ones. As the organizations become large, they will gather a larger number of responsibility-preferring people and thus will become averse to risky behavior allowing adventurous people to build a new B2B product.</p>
<p>That said, I am not profiling people into baskets. I just am saying most (I think all) people have a preference towards adventure type jobs over responsibility jobs or vice versa, but not saying people liking adventurous tasks dont have diligence or people preferring responsibility tasks cannot take risks. One example I can immediately recollect is Indian cricket captain Virat Kohli ( <a href="https://en.wikipedia.org/wiki/Virat_Kohli"><span class="underline">https://en.wikipedia.org/wiki/Virat_Kohli</span></a> ) who was an explosive batsman taking lot of risks and scoring really fast in early phases of his career. However, now that he is captain of Indian team and looking from more of an organizational perspective, he has changed his game to focus on consistency. He doesnt get the super high scores of earlier, but now ensures he scores decent runs in most innings he plays. One is not better than the other, see ! One thing most employees and founders need to understand is which of these types of roles they are good at (and not which of them they like as most would like adventurous tasks due to human bias) and recognize/develop their circle of competence well rather than doing something sub-optimal. If you feel frustrated in uncomfortable situations, try using your love of order to develop your skills in responsibility tasks (No one likes a person whose comfort zone is doing nothing), if you feel trapped in day-to-day tasks, try combining your love of freedom with ability to achieve (No one likes an adventurer who gets nothing done). Also learn to recognize this diversity and appreciate people for their skills than dislike them for their differences from you. As a manager (you are a manager for free when you are a founder), you need to recognize the strength of people and use their help in tasks accordingly where they can contribute better.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-08-30-Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One/media/image8.png" alt="" /></p>
<h3 id="distribute-complexity-dont-delegate-it-or-fall-for-illusion-of-control">Distribute Complexity, Dont delegate it or fall for illusion of control</h3>
<p>Second concept that I would I like to mention is around inter-team co-ordination. Your startup will form natural teams when you do your day to day work. So as an enterprise AI company you will coherent teams around : 1. AI/Deep Learning stack management 2. ETL and webapp/mobile app management, 3. Client Success team, 4. Data Annotation and ops team, 5. Salesforce and Marketing team and maybe more dependent upon your business idea. These teams have very good communication internally as they sit for scrum once or twice everyday and members are involved in solving similar problems. However, when it comes to inter-team communication, there will always be gaps and lags. You can avoid this till you have say a 6 – 8 people team by making sure the concept of sub-teams of people within startup doesn’t exist at all, but after a certain number of employees its inevitable. These gaps between different teams are hard to fill, due to two different reasons :</p>
<p>1. Lost in translation : Business related information originating at client-sales interface or at client-delivery interface is known second (or third or say fourth) hand to a person in tech team and they can decipher it very differently that what it is intended to convey. Information sometimes doesnt even reach the tech person because some manager thought they are not required to know about the business problem but only the tickets related to it. Similarly, Tech information originating at Technology-Problem interface might be visualized at business-client front as too trivial or a big blocker unlike what it actually is. People overestimate their part and underestimate others’ parts by a lot.</p>
<p>2. Open ended questions cannot always have answers : There are always issues for which you will not have answers when you start to work on it. This basically makes different teams work with different assumptions abstracting out what they cannot incorporate into their mental model. After completion of some work, you might find that two teams might have made progress in different directions.</p>
<p>While one responsibility of the founders is to keep this inter-team communication gap minimal, let’s face it, you cannot make sure everyone has exactly the right information everytime in a dynamic environment as the organization scales up. Soviet Union tried to do that with their economy and they are history ! Let’s understand what happens when inter-team communication is weak and only after we understand how events unfold, we can understand how I propose to solve them “Distribute Complexity”.</p>
<p>So let’s say that there is a complex problem a sub-team within startup has to solve it. Say, business team has to convert a new and tough client or Technology team is working on a new feature which requires throwing away lot of code or AI team is starting to use a new Deep Learning architecture in production or Marketing team is thinking about a new blogging style. Everyone needs to admit that the problems they are trying to solve are not just theirs or someone else’s problems totally. So for example, Business team knows the client needs a very good AI demo to sell, so they cannot just say, the AI team should build a very accurate demo ad we will be able to sell. Similarly, when AI team introduces a new algorithm into the system, they cannot just say, let the Business or Client Engagement team wait for the feedback from client and tell us if there was any obvious issue. Or marketing team needs a set of technical blogs, they just send a mail to technology teams to deploy posts on the blog page. I have seen this attitude in many companies. Basically do not delegate all the complexity away to someone else who you think should do it as its their responsibility. Distribute the complexity, solve some parts yourself, let the other team solve some part of the problem. This attitude will only come if founders enforce it from the start, otherwise its very easy for one team to start delegating all the complexity away and working only on fun stuff from their comfort zone. So for example, for the hard client above, the business team can try to manage expectations about the demo to a level which the AI team can promise building given available resources, or the marketing team can take blog post from the tech people and try to make it better SEO wise rather than delegating everything. I feel if the culture of distributing complexity exists, startup will easily overcome unclear inter-team communication.</p>
<p>There is an exactly opposite problem to “Complexity delegation” and that is “maintaining illusion of control”. One very common example here is one team or person trying to do tasks inefficiently beyond their circle of competence. So software executives trying to setup a framework for Artificial Intelligence team, or business team deciding what database to use in the backend are quite common examples from such a culture. While there is some merit in people going beyond their ability and doing things not expected from them, doing it inefficiently always will not work. Founders need to advice good control and let people solve things and discourage them depending upon what they feel is optimal or suboptimal for the company.</p>
<h3 id="problem-solving-hierarchy">Problem Solving Hierarchy</h3>
<p>Everyone solves one or the other problem in a startup. However, one needs to recognize that they have 24 hours in their day and can only work as much per day on an average. Basically, what I am describing here is the intra-team component of my thought about “Distributing Complexity”. Just like within teams you see these two extreme attitudes of delegating everything and containing everything, similar dynamics plays out within teams as well. There are some teams where the leader delegates a bit too much and junior team mates have to look into complexity issues they probably are not as well prepared to solve and then on the other end of spectrum there are leaders who want to solve all complexities themselves and delegate only what they think is “simple” becoming a bottleneck for the team and company. Try not to be these people! Try and understand that you are one person, can do one person’s work and you will need a team to achieve larger goals than what one person can build. So as a founder, you need to do 100% work as an individual contributor plus strategist and manager and also need to make sure the right amount of complexity is assigned to members of your team based on their profile and experience. Thoughts of perfection around “Only me can get all work done with least amount of failure risk” is misplaced as its costs time and makes work slow. Rather recognize teams potential for failure and focus on setting up processes that can detect failures early and before they explode. If you delegate a bit too much, you will see your team not making progress, that is a sign that you need to roll up sleeves and lead the team into accomplishments and then delegate back again.</p>
<p><img src="https://muktabh.xyz/assets/img/2020-08-30-Patterns-I-Noticed-While-Getting-An-AI-Startup-From-Zero-To-One/media/image9.png" alt="" /></p>
<h3 id="last-mile-delivery-is-messier-than-you-think--and-its-very-important">Last Mile Delivery is Messier than you think ! And its Very Important.</h3>
<p>This probably applies more to Enterprise startups. Enterprises want data in some consumable format, which they can plugin to their existing systems and custom dashboards which their executives find helpful. That means while there is a product which applies AI on their data, analyzes it and converts it into an Excel file for all data they shared during an hour say, they dont just want this concise output your AI pipeline creates for them. They would want it in specific format, or maybe integrated into their reporting system, or as a custom dashboard. This output format might often be as important as the product’s utility itself, so you cannot say no! This thus gives rise to need of customer support team(or in their alternative role can also be called customization ninja team) whose aim is to figure out how to quickly solve these one time problems. As I mentioned above, this team is what helps you makes your first sales fast by figuring out quick customizations and helping the product focusing on core concepts. Its basically like you have one airport in the city to/from where you transport all air travelers than building an airport in each locality. Customer Support team figures out a way to make data to/from the team. So unlike in software services, your customer team might need analysts (of course), developers, analytics professionals and BI developers. I have not seen counterpart of such teams in other startups I know (even in the other experiments we run in pivot cycle), so thought it would be worth mentioning about this team. What you need to understand here also is the concept of complexity distribution. Its not always simple to integrate with proprietary systems like how client may expect. Dont just delegate whatever client says to this Customer support team, try setting client expectations and helping the team to close and automate the delivery process faster. Remember, this data to/from movement to your product is sizable work and if it gets slower for a client, the money in bank from this client might get delayed and also would suck time of team who need to manage delivery of the client next in line.</p>
<h3 id="managing-expectations-and-saying-no">Managing Expectations and Saying NO</h3>
<p>Remember that the most important point of business is fulfilling the expectations of clients. However, you need to understand and talk more and more with your client to understand which of the expectations they cannot live without and which of them are good-to-have. Maybe say No in the short term to the good-to-have stuff to make good progress with the clients ? Remember you aim at least in the start is to get money in bank fast to prove the business idea. Developing too many features for a client might make you miss that goal. Another thing you learn to say no are other AI projects not related to your product. If you are trying out an idea to check its potential in pivot cycle, it will already be hard to prove it in a fixed timeframe. I you add more projects into the mix, you are diluting your attention and that increases the probability of a false negative (something that might have worked but you discarded it as something you couldn’t pull off). Trust me on this, an AI project you are doing without building a product to solve complexities of data pipeline, annotation and client integration around it is going to be extremely hard, learnt this the hard way.</p>
<h2 id="research-in-your-ai-startup">Research in your AI startup</h2>
<p>Cool, now you have decided to work on an AI startup of yours. There will be some Deep Learning R\&D required as you cannot use off the shelf models forever and your dataset will have its own peculiarities. Here are a few points I would like to share about the R\&D.</p>
<h3 id="start-with-a-real-world-problem-not-an-ai-model">Start with a Real World problem, not an AI model</h3>
<p>The first thing I would like to remind you again about is do not start thinking about what problems can you solve with the new cool algorithms you have around you. This leads to a bad cycle of sub-optimal products. Your task as an entrepreneur is to do research about real world problem statement you are trying to solve and then decide two things : A. Is it feasible to solve it using the AI methods available ? B. What method(s) would be required to solve the problem ? A is very important because there are people who get into solving things that AI algorithms cannot really solve like predicting social phenomenon, like say interview success or bullshit like Phrenology: <a href="https://twitter.com/ylecun/status/1276147230295166984"><span class="underline">https://twitter.com/ylecun/status/1276147230295166984</span></a>. If you are an AI enthusiast joining an AI startup, please do give a thought if the company you are going to join plans to do something nonsensical. B basically is the process of breaking down the usecase into real world Deep Learning (or Machine Learnig problems). In images you can have a combination of Semantic Segmentation and GANs or in the example ProcureDocs AI we have been using, it will be a set of entity extractors and classifiers. Once you are able to figure out B, you have the blueprint to start working on the AI algorithms and hence the product around it.</p>
<h3 id="dont-start-expecting-a-research-wonder">Don’t start expecting a Research Wonder</h3>
<p>The only way I think you can start building your product with original research is if you were working on something in your university and you discovered something which you think is commercially viable. In all other cases, you need to start with off the shelf Deep Learning (or Machine Learning models) for quick first iteration and sales. In my opinion, you already should be demoing and talking to your clients by the time you think of new research, as that is when you realize what parts of the AI problems you are trying to solve carry more weight-age. Unless you are working on a very obsolete use case, some grad student would have recognized the problem you want to solve and would have published papers on it. Find out existing research for the problem you are trying to solve and build both basic product and baselines before you start anything innovative around new algorithms. Research can never be time bound and the experiment you are doing to evaluate your idea is. If you don’t find any research on the problem you are trying to work on, that is a signal too. It might be a really hard problem you are trying to solve or you might have not performed step B of previous topic well, that is breaking down the real world usecase into solvable Machine Learning problems.</p>
<h3 id="i-dont-think-that-publishing-interesting-results-is-bad-in-anyway">I dont think that publishing interesting results is bad in anyway</h3>
<p>I have come across a few opinions like if you publish the methods you invent, aren’t you running the risk of people copying your IP ? The answer to that is we are. However, I believe publishing your findings has many important benefits which far outweigh someone using your methods after reading your papers. The first benefit is that while your method goes out into open, you get in touch with many enthusiasts who give you valuable feedback you can incorporate into your research. This feedback when cleverly combined with your existing research gives you even better results. Remember, while someone might be trying to implement the methods you publish in your papers, you will be implementing newer algorithms based on feedback you have received on your publication. The second gain is attracting good HR, who are attracted to your firm by looking at your work. As an early stage startup, it will be hard to hire expensive AI engineers and the only way to tell enthusiasts that good, promising and innovative projects are done in your team is to show them what type of results you publish. You might attract people who buy your tech mission when they read your publications and having a motivated innovative team is a big advantage. The third benefit is that your AI engineers and researchers get rewards which are very important to keep the team morale high during hard times of startup when seemingly no progress is being made. When you are running a pivot cycle and your experiments fail, techies will feel dejected as all the efforts they put into building something will mostly be trashed to make way for a new experiment. While you cannot help doing multiple experiments in pivot cycle, the publications keep the team’s morale high and they feel they have done something substantial building tech even if the business could not scale.</p>
<h3 id="having-a-research-vision-is-important-after-product-graduates-the-pivot-cycle">Having a Research Vision is important after product graduates the Pivot Cycle</h3>
<p>The startup needs to have a Research Vision about what the AI team specifically needs to develop in a quarter or year and measure progress with respect to that. Its hard to do time bound research but its not hard to look at the tasks done and estimate if any on-ground progress is being made. A very common mode I have heard a few AI startups go into is Data Scientists working in random directions and not achieving anything concrete. Its very easy to speak a few technical terms in front of non-AI people to overwhelm them and avoid having a discussion about real progress made. <em>So the AI lead needs to</em> :</p>
<p>1. Have regular review meetings about what are the goals the AI team is striving to achieve in say next quarter or half year.</p>
<p>2. Setup a Research Vision and all projects of AI team must fall in line with this research vision. Research Vision must take in account big pain points of clients and customer support team and the type of datasets company is planning and collecting.</p>
<p>3. Make sure there is progress. Data Scientists have their own comfort zone where they read and discuss more and more about possible methods and implement less. An idea means nothing, implement it and prove it works or doesn’t. More ideas you try out, more are the chances of success. A lot of applied AI research is clever and well informed trial and error.</p>
<h1 id="moats-for-an-ai-startup">Moats for an AI startup</h1>
<p>For new entrepreneurs, I would like to define what a moat is. A moat is essentially the world asking you how would your startup survive if say the richest and most innovative person in the world (Elon Musk maybe ? ) thinks of starting a competitor to your startup. The arguments you have in response to this question are guarantee to your investors that their money is safe and to your employees that they are not working on something that can become redundant fast. Its a hard question to answer and people will have answers like Network Effect etc, but we dont really know how this moat phenomenon will shape up for AI startups: <a href="https://a16z.com/2020/02/16/the-new-business-of-ai-and-how-its-different-from-traditional-software/"><span class="underline">https://a16z.com/2020/02/16/the-new-business-of-ai-and-how-its-different-from-traditional-software/</span></a> . I have a few expectations about how a moat for an AI startup might look like in future :</p>
<h3 id="the-usual-enterprise-as-a-client-lock-">The usual Enterprise-as-a-client Lock :</h3>
<p>It takes a really really long time to onboard an enterprise. You do demo/PoC, maybe multiple pilots, integrations, phased rollouts, many customizations once they are onboard and start understanding their internal lingo. Needless to say, this takes a lot of effort on both the teams, the startup and its clients. Inertia thus becomes your friend. Unless you really screw it up or are quite costly, the client will not want to replace you. With an effective pricing and good delivery, you can build a non-fragile business.</p>
<h3 id="preferential-attachment-">Preferential Attachment :</h3>
<p>A comparatively weak moat which can be achieved by very early movers/winners into a business idea. The idea is to use the first movers advantage to shape the market. A first movers gets the first client credentials, creates the first technology and inventions, creates the first wave in the industry, figures out the first pricing models and creates the first set of experts. Once your people are experts, you can shape narrative of the industry you work in. Unless you miss out on some very important aspect on which the late arrivals cash on (the entire gameplan OTOH for late entrants is to learn from mistakes of the early bird), the early mover is hard to defeat. Most businesses around AI are relatively new context and are waiting to be explored. Good time to build preferential attachments.</p>
<h3 id="infrastructure-moat-">Infrastructure Moat :</h3>
<p>This is possibly the first moat which you see playing out in the real world right now. The trend with respect to AI models that if you can supply large amounts of data, the larger the model, the better it works. GPT3 for example is a huge AI model that can only be deployed on specialized hardware and not commodity hardware available to everyone else in the world. <a href="https://news.developer.nvidia.com/openai-presents-gpt-3-a-175-billion-parameters-language-model/"><span class="underline">https://news.developer.nvidia.com/openai-presents-gpt-3-a-175-billion-parameters-language-model/</span></a> . Now the fact that the NLP predictions by GPT3 are better than anything we have seen before and cannot be replicated by others due to the lack of hardware which can hold the GPT3 model, gives a unique advantage to OpenAI. Basically anyone using OpenAI APIs will get better results than someone trying to keep the model in their own premises. Very interesting economics would shape up here as maybe this is not going to be a monopoly but can become an oligopoly with other big AI players having huge and super accurate AI models they can only host. Such type of an advantage where a new entrant will have to invest substantially in hardware to get parity is achievable by large firms who are incorporating AI into their products or AI startups that have been able to raise a lot of money. That said, infrastructure moat also gives rise to the incentive to bringing huge models back to commodity hardware (say through discretization) and many startups will try (and might succeed) to democratize GPT3 and other huge models again.</p>
<h3 id="data-moat-">Data Moat :</h3>
<p>While very large models trained on special hardware might be something that not all companies can afford, even relatively smaller models function better when more annotated data is available with higher variety for them to learn. So when two companies use exactly the same AI algorithms, one having more data to train them will have a better service than the other. So if you can setup a loop in your business which consistently annotates training data for AI making your training dataset bigger and better, you will always stay ahead of the curve. It doesnt just stop here, recent Deep Learning methods have introduced regimes where availability of unannotated data gives better AI performance. So you can be ahead of a newcomer just by having lots of data, even if you dont annotate it. Just having a lot of data can make you stronger than your competitors.</p>
<p>I think I have covered all topics I wanted to. That said, always open to any questions, you can tweet to me at @muktabh or ask a question on Quora: quora.com/Muktabh-Mayank .</p>In this post, I am going to document some trends, tricks and patterns I have derived from the Zero to One phase of my startup. I will try to broadly describe to you lessons I distilled while getting an Enterprise AI startup from nothing to its first revenues. First revenues are not success, they are necessary but not sufficient for success, so don’t confuse this with recipe for a Unicorn say. If and when we make it big, another post on “How to create a successful AI startup” will come up :) .