March 20, 2008

The Unfulfilled Promises of Hugo Chávez

On December 2, when Venezuelans delivered President Hugo Chávez his first electoral defeat in nine years, most analysts were taken by surprise. According to official results, 50.7 percent of voters rejected Chávez's proposed constitutional reform, which would have expanded executive power, gotten rid of presidential term limits, and paved the way for the construction of a "socialist" economy. It was a major reversal for a president who just a year earlier had won a second six-year term with 62.8 percent of the vote, and commentators scrambled to piece together an explanation. They pointed to idiosyncratic factors, such as the birth of a new student movement and the defection of powerful groups from Chávez's coalition. But few went so far as to challenge the conventional wisdom about how Chávez has managed to stay in power for so long.

Although opinions differ on whether Chávez's rule should be characterized as authoritarian or democratic, just about everyone appears to agree that, in contrast to his predecessors, Chávez has made the welfare of the Venezuelan poor his top priority. His government, the thinking goes, has provided subsidized food to low-income families, redistributed land and wealth, and poured money from Venezuela's booming oil industry into health and education programs. It should not be surprising, then, that in a country where politics was long dominated by rich elites, he has earned the lasting support of the Venezuelan poor.

That story line may be compelling to many who are rightly outraged by Latin America's deep social and economic inequalities. Unfortunately, it is wrong. Neither official statistics nor independent estimates show any evidence that Chávez has reoriented state priorities to benefit the poor. Most health and human development indicators have shown no significant improvement beyond that which is normal in the midst of an oil boom. Indeed, some have deteriorated worryingly, and official estimates indicate that income inequality has increased. The "Chávez is good for the poor" hypothesis is inconsistent with the facts.

March 16, 2008

Drug Trade Tyranny on The Border

The killers prowled through Loma Bonita in the pre-dawn chill.

In silence, they navigated a labyrinth of wood shacks at the crest of a dirt lane in the blighted Tijuana neighborhood, police say. They were looking for Margarito Saldaña, an easygoing 43-year-old district police commander. They found a house full of sleeping people.

Neighbors quivered at the crack of AK-47 assault rifles blasting inside Saldaña's tiny home. Rafael García, an unemployed laborer who lives nearby, recalled thinking it was "a fireworks show," then sliding under his bed in fear.

In murdering not only Saldaña, but also his wife, Sandra, and their 12-year-old daughter, Valeria, the Loma Bonita killers violated a rarely broken rule of Mexico's drug cartel underworld: Family should remain free from harm. The slayings capped five harrowing hours during which the assassins methodically hunted down and murdered two other police officers and mistakenly killed a 3-year-old boy and his mother.

The brutality of what unfolded here in the overnight hours of Jan. 14 and early Jan. 15 is a grim hallmark of a crisis that has cast a pall over the United States' southern neighbor. Events in three border cities over the past three months illustrate the military and financial power of Mexico's cartels and the extent of their reach into a society shaken by fear.

March 13, 2008

Yonder belief: China

When hard and soft infrastructure combine, as they do in China, the result can be overpowering.
HDFC wasn't quite honest in its recent ad campaign promoting its Infrastructure Fund. Headed "Magnificent India," the ad carried the photo of what surely is a magnificent bridge, but it wasn't an Indian bridge at all. It was the Nanpu Bridge across Shanghai's Huangpu River, with its famous coiled approaches. There wasn't even an acknowledgment.
It was foolish of HDFC to believe nobody would see through the silly pretence. If the idea was to convey that one day India would be as magnificent as China in the quality of its infrastructure, why didn't HDFC say so? Surely, that would have been more honourable than passing off someone else's achievement as ours.
But I must admit I liked the hidden message. Indeed, China is a role model in infrastructure development and India would do well to look up to it. However, I doubt if HDFC or anybody really understands what it actually means. What's happening in China is a total revolution, on all fronts, at the same time. What's happening in India is a hit-and-run tamasha, one road here, one flyover there, bridges without proper approaches, highways running into sudden bottlenecks, destinations that can't be easily reached (like Bengaluru's new airport).
Here are some facts to show our infrastructurewallahs where China is headed and, by implication, what it would take us to reach a level of magnificence where one would be amazed enough to say, "Wow!"
Take roads. A 35,000-km network of trunk roads, with five major north-south corridors and seven east-west ones, is now almost ready and will connect all cities with a population of 1 million or more. Highways make up 75 per cent of this network. But, increasingly, highways are giving way to expressways where even freight trucks move at speeds of 70 km per hour, or more. In another 12 years, there will be 85,000 km of expressways in China — in length, second only to the US.
Or railways. Having built the world's first commercial Maglev and an astonishing 1,500-km railway to Lhasa, China has begun work on what's going to be another engineering marvel, a $27 billion, 1,318-km high-speed railway link between Shanghai and Beijing with trains hurtling at 350 km per hour. China is desperate about building new railways and has advanced by five years its earlier target of having 120,000 km of tracks by 2020. And speed is the name of the game. Already, 257 of China's trains operate at 200 km/h or more and 22,000 km of tracks, or 29 per cent of the national network, support trains running at 120 km/h or more. By 2020, China expects to have 12,000 km of passenger-only high-speed tracks.
One sees a similar concern for urban railways. Some 600 km of subways and light railways already exist and 36 new subways are being built in 12 cities. In the next 10 years, urban rail transit lines will expand to 1,700 km. Beijing alone is building 11 new subway lines with a total length of 270 km. By 2015, it will have a network of 19 metro lines aggregating more than 440 km, and all residents within its fourth Ring Road will be within a kilometre of a subway station.
Consider also this: A spanking new terminal has just opened at Beijing International Airport, ahead of the August Olympic Games, while 100 new airports will be built in the next 12 years, taking the total number of airports to 242 and bringing 70 per cent of the population within a hundred kilometres of one. Seaports, too, are going through furious expansion as Chinese containers begin to flood the world. Shanghai is already the world's busiest container port and a huge deep-water port is coming up on Yangshan, a reclaimed island off Shanghai connected to the mainland by a 20-mile-long bridge.
There are other things to wow about in China. It has taken only eight years to reinvent Beijing, only five to transform the barren fields of Shanghai Pudong. Four hundred new cities are to be built in the next 12 years as modernisation sweeps inland from the coasts. This month, a 36-km, six-lane highway will open across Hangzhou Bay to link cities and towns of the Yangtze River Delta, the longest sea crossing in the world. A second mammoth West-to-East natural gas pipeline, 8,794 km long and likely to cost some $20 billion, is nearing completion.
What's most amazing about the Chinese infrastructure story is the extremely coordinated manner in which it's unfolding, as if an orchestra is at play. But that's one side of it. The other side is no less impressive: 99.5 per cent of the country's villages now have access to telephone links and 95 per cent of them will have broadband connectivity by the end of this year. That's infrastructure, too, and when hard and soft infrastructure combine, the result can be overpowering.