Modern Flourishes at Obamas’ State Dinner

Gursharan Kaur, the first lady of India, Michelle Obama, Prime Minister Manmohan Singh of India, and President Obama arrived for the state Dinner.


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It is an old tradition, a White House dinner governed by ritual and protocol that happens to be this city’s hottest social event. But at their first state dinner on Tuesday night, President Obama and his wife, Michelle, made sure to infuse the glittering gala with distinctive touches.

They hired a new florist, Laura Dowling, who bedecked the tented outdoor dining room with locally grown, sustainably harvested magnolia branches and ivy. They selected a guest chef, Marcus Samuelsson of Aquavit in New York, an American citizen who was born in Ethiopia, reared in Sweden and cooks up melting pots of flavors and cuisines.

They invited local students to witness the arrival of the guests of honor, Prime Minister Manmohan Singh of India and his wife, Gursharan Kaur, and presented a mélange of musical entertainment, including the National Symphony Orchestra; Jennifer Hudson, the singer and actress; Kurt Elling, the jazz musician from Chicago; and A. R. Rahman, the Indian composer who wrote the score to the movie “Slumdog Millionaire.”

And at the tables, the meatless menu included a mix of Indian and American favorites, including some African-American standards. Collard greens and curried prawns, chickpeas and okra, nan and cornbread were served to the 320 guests — including some well-known Republicans and prominent Indian-Americans — who started off with arugula from the White House garden and finished up with pumpkin pie tart. (After a tasting at the White House on Sunday, the Obamas gave the dishes their stamp of approval, Mr. Samuelsson said.)








Obamas Host State Dinner

The Caucus: The State Dinner Guest List

The Caucus: State Dinner Highlights

PM Singh visits

On World Focus last evening, host Martin Savidge talked with Amit Pandya (a senior associate at the Stimson Center, an organization dedicated to promoting international peace and security).I found Mr. Pandya a very interesting voice to listen to, insightful, incisive.

Products reinvented, or invented, to serve a market of 1.1 billion people. Billion. Some of the products are quite impressive. WIsh we could get our market to offer them.


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* OCTOBER 20, 2009

Indian Firms Shift Focus to the Poor

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By ERIC BELLMAN

MUMBAI -- Indian companies, long dependent on hand-me-down technology from developed nations, are becoming cutting-edge innovators as they target one of the world's last untapped markets: the poor.
Moving Up in India

Review low-cost products on the market in India.

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India's many engineers, whose best-known role is to help Western companies expand or cut costs, are now turning their attention to the purchasing potential of the nation's own 1.1-billion population.

The trend that surfaced when Tata Motors' tiny $2,200 car, the Nano, hit Indian roads in July, has resulted in a slew of new products for people with little money who aspire to a taste of a better life. Many products aren't just cheaper versions of well-established models available in the West but have taken design and manufacturing assumptions honed in the developed world and turned them on their heads.

For the farmer who wants to save for the future, one Indian entrepreneur has developed what is, in effect, a $200 portable bank branch. For the village housewife, a wood-burning stove has been reinvented to make more heat and less smoke for $23. For the slum family struggling to get clean water, there is a $43 water-purification system. For the villager who wants to give his child a cold glass of milk, there is a tiny $70 refrigerator that can run on batteries. And for rural health clinics, whose patients can't spend more than $5 on a visit, there are heart monitors and baby warmers redesigned to cost 10% of what they do elsewhere.

Such inventions represent a fundamental shift in the global order of innovation. Until recently, the West served rich consumers and then let its products and technology filter down to poorer countries. Now, with the developed world mired in a slump and the developing world still growing quickly, companies are focusing on how to innovate, and profit, by going straight to the bottom rung of the economic ladder. They are taking advantage of cheap research and development and low-cost manufacturing to innovate for a market that's grown large enough and sophisticated enough to make it worthwhile.

"There was a large potential market that all the players have not been able to reach," says G. Sunderraman, a vice president at Mumbai's Godrej & Boyce Manufacturing Co., which developed the inexpensive refrigerator dubbed the "Little Cool." "Now economic factors are making these areas more and more attractive."

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A doctor in India uses the GE Mac 400 heart monitor, redesigned to reduce its cost to about $1,000, or one-tenth what standard models cost.
GE Healthcare

A doctor in India uses the GE Mac 400 heart monitor, redesigned to reduce its cost to about $1,000, or one-tenth what standard models cost.
A doctor in India uses the GE Mac 400 heart monitor, redesigned to reduce its cost to about $1,000, or one-tenth what standard models cost.
A doctor in India uses the GE Mac 400 heart monitor, redesigned to reduce its cost to about $1,000, or one-tenth what standard models cost.

Unexpectedly strong demand for cheap cellphones in recent years revealed the untapped markets in India's villages and slums. Thanks to $20 cellphones and two-cent-a-minute call rates, Indian cellphone companies are signing up more than five million new subscribers a month, most of them consumers no one would have considered serving only five years ago.

At the same time, many of the nation's poor have become aware of material goods available in developed economies thanks to a proliferation of television networks, radio stations, newspapers and magazines.

As with all innovations, many of these new products will fail to make their mark. But with so many unlikely products aimed at overlooked consumers, the trend could bolster bottom lines over time, create new companies and lead to a new kind of multinational corporation that thrives outside of the developed world. Unilever NV and General Electric Co. are taking notice. GE's chairman, Jeffrey Immelt, on a recent tour of Asia, outlined how the global giant is restructuring to take advantage of what he calls "reverse innovation." While in India this month, he said the innovations in medical equipment here could eventually help bring down the cost of health care in the U.S.

"The biggest threat for U.S. multinationals is not existing competitors," says Vijay Govindarajan, professor at Dartmouth's Tuck School of Business and chief innovation consultant to GE. "It is going to be emerging-market competitors."

What is happening today is much different than the so-called "sachet revolution" of the 1980s when Unilever and other consumer-goods companies realized they could sell hundreds of millions of dollars more of their shampoo, detergent, toothpaste and snacks just by selling them in tiny packets.

This time, Indian engineers are reinventing products to cut costs and reach the billions of people world-wide who live on less than $2 a day.

The growing awareness of this new market has sparked start-ups as well as new business divisions in established Indian companies. Everyone from small local players -- looking to go national then global with their low-price inventions -- to the country's biggest conglomerate, the Tata Group, are in the race. They are trying to figure out what the poor want and how much they are willing to pay for it. Then the companies are going back to their research teams and crafting new products and unprecedented price points.

"These are not cheap knockoffs of Western products, they are in many cases very different products," says Arindam Bhattacharya the Delhi-based managing director of the Boston Consulting Group. "Western companies have not often explored these segments so they are untapped markets."

Western companies as well as most large Indian companies have long ignored poor markets because any potential profits seemed too slim. It was too expensive to create a distribution system that could serve the consumer who shops from closet-size kiosks or weekly country markets.

But instead of using traditional supply chains, many companies are distributing through rural self-help groups and microlenders that are already plugged into villages. And while profit margins are slim, companies are counting on volume to compensate. Many hope to sell to other poor and underserved markets in Asia and Africa eventually.

Hindustan Unilever spent four years developing its battery-powered portable water-purification system called Pureit. The $43 water-cooler-size system is now in more than three million Indian homes, many in hard-to-reach rural areas, thanks to its network of 45,000 women, who demonstrate the Pureit and other Unilever products in their own homes. They then sell door to door around their villages, often from the back of bicycles.

Some of the products may end up in developed markets. One of the Nano's first export markets, for example, will be Europe. The European version of the car will have better interiors and safety features and cost more than the Indian version but will still be cheaper than almost anything in Europe.

Godrej, one of India's oldest groups, which is involved in everything from padlocks to pest management, saw cellphone companies sell millions of new handsets a month in India's rural backwaters and wanted in on the action. Fewer than one in five Indian homes has a refrigerator, so Godrej figured it could attract a huge new group of consumers if it could get the price right.

It sent surveyors into village huts for months at a time to discover the needs of farm families. The result: The "ChotuKool," or "Little Cool" in Hindi, looks more like a cooler. It opens from the top and is about 1.5 feet tall by 2 feet wide. It is tiny because the poor live in small homes and don't buy food in bulk. It has handles to make it portable for the migrant workers who move a lot. It has no compressor to break or make noise. Instead, it runs on a cooling chip and fan similar to those used to cool computers. It can survive power surges and outages common in the country kitchen and even has the option of running on batteries. While designed with cost in mind, it uses high-end insulation to stay cool for hours without power.

By keeping it small and reducing the number of parts to around 20 instead of the 200 that go into regular refrigerators, Godrej has been able to sell it for only $70, which is less than one third of the price of a regular bottom-of-the-line fridge. It also consumes only half the power so it keeps electricity bills at a level the poor can afford.

"No one in our family has ever had a refrigerator," said Sangeeta Harshvardhan, a housewife in Udgir, a remote rural village in the western state of Maharasthra. "But at this price even we can afford one now."

While they have only had the fridge a month, her family is already used to the convenience. It allows her to stock up on the cucumbers her husband munches three times a day, put cool water in her son's thermos before he goes to grade school, and avoid having to boil milk to purify it every time she makes tea.

A start-up company, First Energy, which was launched with the help of BP PLC, had to reinvent the wood-burning stove to come up with a product that had the convenience and the price to crack the same market. Hoping to help village women who spend hours a day looking for wood and keeping a fire going to cook for their families, the Pune-based company adopted the gasifier technology used in power plants to make a stove that would burn more efficiently and with less smoke. Engineers from the Indian Institute of Science in Bangalore designed a stove with a perforated chamber that uses a small fan to get just the right amount of air to keep a fire burning at a high temperature, meaning less smoke and quicker cooking. It has sold around 400,000 of the $23 stoves across India.

"A lot of innovation has gone into the stove as well as the fuel," which is dry pellets made of agricultural waste like corn husks and peanut shells, says Mahesh Yagnaraman, head of First Energy. "This is not a gizmo like a cellphone. But it is definitely a life-changing product because the houses will not be smoky."

To bring banking services to villages, Anurag Gupta, a telecommunications entrepreneur, distilled a bank branch down to a smartphone and a fingerprint scanner. A bank representative goes directly to a village and can set up shop anywhere there is shade. Savers line up and give an identification number, scan their fingers and then deposit or withdraw small amounts of rupees. The transactions are recorded through the phone and the representative later visits a standard branch to pick up or drop off rupees as needed.

Mr. Gupta named his innovation Zero, after what he says is India's most important innovation -- the number zero -- which many believe was invented by Indian mathematician Aryabhata in the sixth century. Indian banks already are using his system to open millions of new accounts. The running cost of his "branches" is about $50 a month to serve hundreds of people daily. A standard branch or ATM costs thousands to run.

"We made this phone into a branch of a bank," said Mr. Gupta, holding up the smart cellphone his system uses to keep data on accounts, depositors' fingerprints, photos and voices.

The Zero system is already helping Indian construction workers in Bahrain open bank accounts and send money home.

Much of this is possible because engineers are so plentiful and inexpensive in India. It took close to 300 engineers around four years to develop the Tata Nano, which required rethinking everything from the engine to the seats to the supply chain to keep the sticker price at around $2,200.

GE tapped the same pool of inexpensive expertise to target Indian hospitals and clinics that cannot afford its equipment designed for the U.S. GE Healthcare has used Indian software engineers to develop an electrocardiograph that costs $1,000, one-tenth the standard models used in the past. GE hopes to sell the technology in the U.S. eventually and elsewhere.

"In India we have the engineers that have the brainpower and the bandwidth to deliver on these types of projects," said V. Raja, chief executive of GE Healthcare's business in India.
—Sonya Misquitta in Mumbai and Paul Glader in New York contributed to this article.

Clinton's 'Defense Umbrella' Stirs Tensions

Secretary of State Hillary Clinton, center, arrives in Phuket, Thailand, on Wednesday for the Asean meeting, amid human-rights concerns in Myanmar.








U.S. Secretary of State Hillary Clinton caused waves in the Middle East during her visit to Southeast Asia, telling a Thai television program that Washington could extend a "defense umbrella" to protect its Arab allies if Iran succeeds in developing nuclear weapons.

Surround Iran with a nuclear threat to contain it. Sounds a rather familiar strategy: Soviet containment.

She also warned Southeast Asian nations about North Korea potentially exporting nuclear technology to their neighbor Myanmar, and sought the help of foreign ministers in ensuring North Korea's "irreversible denuclearization."

Myanmar with a nuclear capability?

But her comments on Iran left the impression among some Middle East diplomats Wednesday that the U.S. envisions having to find ways to defend its Persian Gulf allies from a nuclear-armed Iran -- rather than preventing Tehran from ever getting that far.

Well, it is not a new policy, goes the spin of a "senior U.S. official close to Mrs. Clinton."

But to some Middle East diplomats, the idea of a "defense umbrella" sounded like a nuclear shield reminiscent of the strategy Washington employed against the Soviet Union during the Cold War -- suggesting the Obama administration was contemplating the need to contain Iran's nuclear program, if it can't be eliminated.

Having an "if" option is prudent and responsible, but hinting at it publicly is something entirely different. For the Secretary to say so wasn't a slip, but an intended signal, a clear message.

Israel's minister of intelligence and atomic energy, Dan Meridor, told a military radio station that Mrs. Clinton's remarks indicated that the U.S. had "already come to terms with a nuclear Iran," he said, according to the Associated Press. "I think that's a mistake."

Israel will nto allow Iran to have a bomb; not if it can help it. Arab states, on the other hand, want the shield, and wwant Washington to be more aggressive.

"The danger in the statement [by Mrs. Clinton] is the implication that the defense umbrella will only be extended if or when Iran gains a nuclear capability," said the Arab official.

Don't want until it is a fact that Iran has a nuclear capacity; start now. Moscow, Beijing and Delhi may not go along with putting more pressure on Tehran. In fact, the recent instability in Iran is being cited as a reason to give Tehran more time to respond.

Meanwhile, U.S. and United Nations officials acknowledge that Tehran's nuclear activities continue unimpeded. Officials from the U.N.'s nuclear watchdog, the International Atomic Energy Agency, have reported that Tehran is moving close to amassing enough low-enriched uranium to produce a nuclear weapon, provided the material is processed further to weapons grade. Once Iran reaches this breakout capability, said U.S. and Middle East officials, the strategic balance in the Middle East could begin to shift and prompt other regional countries to pursue nuclear programs.

Thus, Russia, China and India are ready to accept Iran having a nuclear capability. Surely the first two want to prevent the US consolidating its hegemony in the region; perhaps India does, as well.

India’s Path to Economic Reform Reaches a Fork

Candidates and leaders in the governing Congress Party looked out from a billboard in Bhubaneshwar, India, where voting for Parliament ended Wednesday.

May 14, 2009
India’s Path to Economic Reform Reaches a Fork
By VIKAS BAJAJ

MUMBAI, India — In one of the many slick campaign commercials that are airing during this country’s monthlong election, an actor reels off the signature achievements of the governing Congress Party over the last 60 years: independence, land reform, a green revolution and bank nationalization.

The Bharatiya Janata Party, the main opposition, is championing subsidies for a struggling diamond industry and promising to protect farmland against “dubious industrial projects.” One regional party said it would reduce the government’s use of computers to increase employment.

India’s rise as an economic power has captivated many people in the West, but talk of economic openness and dynamism leaves many Indians cold. This year, the global financial crisis has made appeals to India’s traditional socialist-style self-sufficiency even more popular. Policies that seemed increasingly outdated during the fast growth of the past 15 years are getting a fresh hearing, partly because they are seen as insulating much of India from the global slump.

No matter which coalition of parties comes to power in voting that ended on Wednesday — none are expected to win a majority in Parliament — the next stage of Indian reforms will be deeply contentious.

Many in the political class are skeptical that India, after nearly a decade of high growth and rising prosperity, needs more openness to investment, fewer state-owned companies, or greater deregulation of the private sector.

Take banks. The government is the majority shareholder in about 70 percent of banks by deposits. Sonia Gandhi, the Congress Party’s president, has said that the nationalization of banks in the 1960s by her mother-in-law, Indira Gandhi, has “given our economy the stability and resilience we are now witnessing in the face of the economic slowdown.”

In its manifesto, Congress promises that the government will retain a majority stake in state-owned companies.

Congress, which started India on the path to economic openness in the early 1990s, now says it has saved the country from freewheeling capitalism. Many of its rivals claim they would do more. A Communist Party leader, Prakash Karat, who is hoping to form a “Third Front” government in partnership with regional parties, has said that the left, which is criticized for holding India back, has in fact “protected our economy, national sovereignty and the interests of the people.”

Even L. K. Advani, the leader of the B.J.P., the opposition Hindu nationalist party that has been more supportive of free markets, has described the financial crisis as a “clear warning to India” not to emulate Western ways. “India cannot attain prosperity by boosting speculative instincts,” he said late last year according to the Press Trust of India.

Economists and political analysts who favor deeper reforms in India say they are worried by the tone of vindication among those who opposed the country’s fitful embrace of foreign trade and competition in recent years. These people say that Indian politicians seem to have forgotten the high price the country paid in terms of slow growth and unshakable poverty when the government kept the country insulated from the outside world during the cold war.

Many people “don’t quite remember how bad it was in the ’80s when we had tremendous amount of rationing, when it took years to get a car, when it took years to get a phone,” said Raghuram G. Rajan, a prominent economist who recently led a government-appointed panel that proposed financial reforms, including a gradual privatization of state-owned banks.

Mr. Rajan, who issued early warnings about the fragility of the American financial system, added that India could pursue reforms without risking the stability of its economy.

“Markets need regulations and regulators, and regulators need to do their job,” said Mr. Rajan, a finance professor at the Booth School of Business at the University of Chicago.

After several decades of state-led economic planning, a Congress-led government started opening up the economy in the early 1990s when a financial crisis forced policy makers to seek help from the International Monetary Fund. Since then, efforts to further liberalize the economy have come unpredictably, depending on the makeup of governing coalitions in New Delhi and the differing inclinations of regional leaders.

Though India’s strong growth in recent years has won the country’s leaders a measure of respect in the rest of the world, the departing Congress-led government had been slowing down reform anyway. It put off deregulation of financial services and the privatization of state-owned businesses to appease the regional, left-leaning parties it needed to stay in power.

Since the subprime mortgage crisis in the United States set off a global downturn, however, the antipathy toward capitalist excess has only grown. Now, smaller parties that respond more readily to populist demands seem poised to stall liberalization and perhaps even roll back measures, like more openness to foreign investors, if they gain seats in Parliament.

“This crisis provides cover for the Indian politicians to say we were right to be cautious,” said Razeen Sally, director of the European Center for International Political Economy who has been critical of the current government’s record. “It’s not only a danger in India, but across the world.”

But the Indian business establishment appears to be less worried, at least as long as the next government is led by Congress or the B.J.P. and not a coalition made up entirely of leftist parties.

Chandrajit Banerjee, the executive director of the Confederation of Indian Industry, said the populist talk would dissipate once a new government confronted economic realities of slowing growth and falling foreign investment. His group is advocating greater infrastructure spending, changing labor laws to allow businesses to hire and fire workers more easily, lifting restrictions on foreign investment, and streamlining licensing requirements.

“Rhetoric is part of elections,” Mr. Banerjee said. Once elections are over, “what one would see is a very, very strong practical approach.”

Still, Rajeev Chandrasekhar, an independent member of the upper house of Parliament and an entrepreneur, said he was worried that the country would not undertake the next series of reforms until it faced a new crisis.

“The real issue is the leadership of the political parties, and the positions that they take are so stark that they don’t allow for a meeting of minds,” he said. “Sometimes the answer may be that you just have to allow the crisis to develop and use it to push through reforms.”

Rare frog caught on film

Video of frog. BBC story.

A rare type of frog has been filmed for the first time by scientists.

The purple frog was only discovered in 2003 in the Western Ghats, in India.

The chubby amphibian spends most of its time buried underground, surfacing only to breed during the monsoon.

Video courtesy of S. D. Biju and the Zoological Society of London (ZSL)

Parliament's Gandhi Makes Populist Play

The next generation from India's top political family. Nehru, Indira, Rajiv, and now Rahul .

Mr. Gandhi is part of a family that is privileged and powerful, and dogged by tragedy. He is the great-grandson of India's first prime minister, Jawaharlal Nehru, and the grandson of its first female prime minister, Indira Gandhi, who was assassinated by her bodyguards in 1984. He is son of Rajiv Gandhi, who also served as prime minister and who was also assassinated, in 1991.

It won't be easy sledding.

The 38-year-old scion of India's most powerful political dynasty, the Nehru-Gandhi family – who is often mentioned as the next prime minister – was shouted down. "I decided that it is important at this point not to speak as the member of a political party but to speak as an Indian," he began. But as Mr. Gandhi described his visits to the countryside, where he saw the positive impact a secure energy supply would have on farming families, jeers erupted. When the Speaker of Parliament couldn't quiet the chamber, he adjourned it for lunch.

Different that the US Congress where members call each other "the gentleman from the great state of" or "the gentlelady".

Over the past few months, Mr. Gandhi has been introducing himself to ordinary Indians through high-profile speeches and tours of the country's most impoverished regions. In the process, he has received a real-time tutorial on just how different he is from the people he may soon govern.

In the US we have the Rockefellers, Bushes, Kennedys, among other family dynasties, but the Gandhi clan is quite different.

Like the Bhutto family in Pakistan, the Gandhis have long served as a unifying political force, mainly by virtue of the family's devotion to politics and its bloody sacrifices. Because of his political pedigree, Mr. Gandhi is seen as someone who can boost party membership, stave off defections and mobilize the grassroots.

Though it is possible Prime Minister Manmohan Singh will stand again for the post, many are now looking to Mr. Gandhi as the new standard-bearer for a party in disarray. In a nation where two-thirds of the population is under 35, the fresh-faced Mr. Gandhi is seen as an appealing contrast to India's familiar elderly politicians. L.K. Advani, the likely prime-ministerial candidate from the other national party, the Bharatiya Janata Party, is 80 years old.

PM Singh is 75.

The nation's disparities are becoming increasingly stark. India has more billionaires than Japan, but it also has 200 million people below the poverty line. The nation's world-class engineers have underpinned a global outsourcing boom, but 80% of the country's children drop out of school by the time they reach 15. India's skilled surgeons have fueled a lucrative medical-tourism industry, but at rural public-health clinics, doctors frequently fail to show.

Telling numbers. Wonder what the poverty line is?

Indian Leader Survives Vote; Onus Now on U.S. Congress

India’s government survived a no-confidence vote, providing Prime Minister Manmohan Singh with a much-needed political boost ahead of a general election and the backing to secure a nuclear deal with the U.S.

Now the US Congress has to act. This seems a good deal to approve. India is an important ally in all terms: geopolitically, it is strategically important; it is the world's most populous democracy, and a natural US ally.

Now the Indian leader's victory puts the onus on the U.S. Congress, which must approve the pact. U.S. businesses that see a big market in India have pinned high hopes on ratification. However, a short, packed calendar on Capitol Hill means a vote is likely to be put off until next year. Both John McCain and Barack Obama have suggested they favor the deal.

That's positive. India is a far better ally than Pakistan.

India has emerged over the last decade as one of Asia's rising economic powers, nearly rivaling China in its influence on global business. While U.S. and European companies are counting on Indian demand to cushion a slowdown at home, fast-rising prices are threatening India's economy. Wholesale-price inflation has been hovering at more than 11%, a 13-year high. The Indian central bank has raised interest rates and taken other tightening measures. Finance Minister P. Chidambaram said in Parliament Tuesday that economic growth in the year ending March 31, 2009, is likely to come in at 7% to 8%, a marked slowdown from an average of almost 9% over the past five years.

Imagine, slowing down to a 7% growth rate. Still, India's economy is only developing. In 25 years it will be quite a tiger; I think in the long run it may even surpass China. In any case, it will be one of the 5 top countries in the world, I think: India, China, Russia, Brazil, the BRIC countries, are poised to being 4 of the strongest economies in the world.

Foreign investors and local businesspeople generally welcomed the confidence vote. Political uncertainty is among the factors that have driven the nation's benchmark stock index down more than 30% this year.
The Sensex was above 20,000 at one point (actually, 20, 873, on 8 January 2008); it is now 14,942. That's down 5,931 points (28.4%) in six months. Similarly, my India mutual fund, Matthews India (MINDX) is down to 16.12, from 25.07 on 7 January (having recovered from 14.69 on 1 July). That's down 8.95, or 35.7% (10.38, or 41.4%).

India's Government Survives

This TV grab image taken from the NDTV News channel shows Ashok Argal of India's main opposition Hindu nationalist BJP holding up bundles of notes in the lower house of parliament.

In the US Congress the term used is "special interests" -- in India's parliament they apparently simply call it money.

India's government survived a confidence vote, but not before the process was thrown into disarray when opposition parliamentarians brandished large bundles of cash on the floor of the legislature, alleging opposition legislators had been offered bribes to abstain from the vote. The margin of victory for the government was a wider-than-expected 275-256.

The Journal's front cover shows a great picture of Indian PM Manmohan Singh. And a story on page A10 shows other hand gestures.
Indian lawmakers gathered Monday to debate the no-confidence vote. Suraj Bhan (right) was one of several lawmakers participating who is serving a jail sentence.

Bye, Bubble? Price of Oil Peaking?

Highlights from article in Barron's about petroleum.

Of oil bulls, article states: Statistics support their view that demand growth is in its infancy in the developing world: U.S. per-capita oil consumption is 25 barrels annually, while Japan uses 14 barrels per person. China's 1.3 billion people consume just two barrels each per year, however, and India's 1.1 billion use less than a barrel a year.

25 barrels equals 1,050 gallons. Of course, that is both gasoline and home fuel.

Edward Morse, chief energy economist at Lehman Brothers, thinks oil could fall to $100 by year end.

The price of oil may be peaking and plunge to $100 a barrel by year's end says Barron's Associate Editor Andrew Bary, (June 21)

Down $40 from $140 is a 29% drop.

Skeptics say the Saudi vow to boost production is merely talk, and that the country is struggling simply to maintain production because of aging, overworked fields like the huge, 60-year-old Ghawar reservoir. The Saudi government refuses to allow in outsiders to evaluate the state of its oil industry, which has fueled talk the Saudis are hiding something.

Likewise, the size of speculative positions and commodity indexers is impossible to determine, as most trading occurs away from the major commodity exchanges in over-the-counter transactions.

It is hard to argue that oil demand supports $135 crude. Now at 86 million barrels a day, global demand could show little or no increase this year after averaging 1% gains in recent years. Sanford Bernstein analyst Neil McMahon projects that by the fourth quarter, global oil demand could be running below the fourth quarter of 2007.

Conventional wisdom.

The dollar's slide and the Federal Reserve's neglect of the greenback have supported commodity prices, oil in particular. But Fed Chairman Ben Bernanke and his colleagues finally seem to have realized that the Fed's aggressive easing actions since last summer, which dropped the key federal-funds rate to 2% from 5.25%, may be fueling global inflation. If the Fed moves to lift rates later this year, as financial markets anticipate, it could buttress the dollar and spur an exodus of speculators from the oil market.

May be?

One little-discussed way the U.S. could try to bring down oil prices is to sell oil from the strategic petroleum reserve (SPR). The SPR, intended as a source of oil for national emergencies, now holds 705 million barrels of crude, equal to about 35 days of domestic consumption. With prices higher, Congress moved in May to stop adding to the SPR as it neared capacity. A sale of 100 million barrels of oil would shock the markets and potentially drive down prices.

Potentially.

Long term, the U.S. could benefit through lower oil prices if Congress and the states back President Bush's proposal to allow drilling off Florida, the East and West coasts, and in the Alaskan National Wildlife Reserve, where billions of barrels of oil may lie.

Could, and may.

Cellphone Data Track Our Migration Patterns

Fascinating story highlighting the efficacy and ease of using available data, as well as its dangers and potential abuses. I particularly enjoy that the focal point is Flushing.

The one stat that jumps out at me is how significant the percentage of calls to Porto, Portugal is: 9% of calls from Flushing.

Cellphone users are spiders of the electromagnetic spectrum, spinning intricate, invisible threads of data about themselves as they walk and talk throughout the day.

Physicists, urban planners and social scientists are eagerly weaving millions of these electronic threads into patterns of people on the move, through studies that until now were all but impossible.

What makes things possible is that all calls are in the phone companies records: number dialing, number called, minutes spoken. The phone company also knows who owns the calling number, and might known the called number, too.

More than 3.3 billion wireless-phone subscribers world-wide have, in effect, voluntarily adopted devices that record their daily movements in the same way satellite sensors monitor migrating birds, whales, bears and other wildlife. Such precise positioning data, automatically collected by cellphone companies, makes privacy advocates queasy but has social scientists dazzled by the research possibilities.


3.3 billion people voluntarily, perhaps unknowingly or oblivious or indifferent to the consequences of their calling habits being known, allow their privacy to be available. It does, surely, also provide intriguing possibilities.

Imbalances of Power

This is quite discouraging. One writer's opinion, but he is a smart one.

There has been much debate in this campaign about which of our enemies the next U.S. president should deign to talk to. The real story, the next president may discover, though, is how few countries are waiting around for us to call. It is hard to remember a time when more shifts in the global balance of power are happening at once — with so few in America’s favor.

Keen insight; I agree. Bush and his cohorts acted as if what the US decides is simply going to be accepted. Those days are over.

Let’s start with the most profound one: More and more, I am convinced that the big foreign policy failure that will be pinned on this administration is not the failure to make Iraq work, as devastating as that has been. It will be one with much broader balance-of-power implications — the failure after 9/11 to put in place an effective energy policy.

Bush is not the only president to fail to put in place an effective energy policy, of course.

It baffles me that President Bush would rather go to Saudi Arabia twice in four months and beg the Saudi king for an oil price break than ask the American people to drive 55 miles an hour, buy more fuel-efficient cars or accept a carbon tax or gasoline tax that might actually help free us from what he called our “addiction to oil.”

Speak of perceptions: the US president goes to see the Saudis twice (bad enough), and they rebuff him twice.

Friedman writes of two books: Superclass: the global power elite and the world they are making, by David Rothkopf; and The post-American world, by Fareed Zakaria.

Mr. Zakaria’s central thesis is that while the U.S. still has many unique assets, “the rise of the rest” — the Chinas, the Indias, the Brazils and even smaller nonstate actors — is creating a world where many other countries are slowly moving up to America’s level of economic clout and self-assertion, in every realm. “Today, India has 18 all-news channels of its own,” notes Zakaria. “And the perspectives they provide are very different from those you will get in the Western media. The rest now has the confidence to present its own narrative, where it is at the center.”

Mr. Rothkopf’s book argues that on many of the most critical issues of our time, the influence of all nation-states is waning, the system for addressing global issues among nation-states is more ineffective than ever, and therefore a power void is being created. This void is often being filled by a small group of players — “the superclass” — a new global elite, who are much better suited to operating on the global stage and influencing global outcomes than the vast majority of national political leaders.

“Call it the triple deficit,” said Mr. Rothkopf. “A fiscal deficit that will soon have us choosing between rationed health care, sufficient education, adequate infrastructure and traditional levels of defense spending, a trade deficit that has us borrowing from our rivals to the point of real vulnerability, and a geopolitical deficit that is a legacy of Iraq, which may result in hesitancy to take strong stands where we must.”

A very bleak picture, indeed.

Turning Short Stories Into a Main Course

When I read Interpreter of Maladies some years back, I thought it was one of the best books I had ever read. It inspired me to try to write short stories. I've recommended it a number of times to library patrons. Now she has a new book.

Writer Jhumpa Lahiri won the Pulitzer Prize for her first book of short stories. Her second collection, 'Unaccustomed Earth,' is drawing early raves from critics.