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Wednesday, October 1, 2008

Bail Out - For the Sake of Democracy

With the naysayers preventing the bail-out plan from being ratified in the congress, critics of Washington (consensus), and sceptics of Capitalism, and now Democracy, appear vindicated. People are beginning to question the ideals of not only Capitalism, but also questioning the ideals of Democracy - after-all, what is good for the people must be good for the congress, isn't it? We all know by now that this ongoing financial crisis is not just a Wall-Street issue, it is very much a Main-Street issue. Another interesting fact emanating from this crisis is clearly lack of 'Leadership' in the US. Unfortunately, there seems to be no one capable of galvanizing support and build a political consensus to fix the immediate issue. This is pretty dangerous, not only for the US, but for all those who believe in the ideals of Democracy and Capitalism. If people in the US and in the West lose faith in the system, imagine the critics. 

Let me try and draw a parallel - a situation that im being personally forced into. One of my UK-based client is in urgent need of bail-out. Yes - there were strategic and fundamental blunders that were (inadvertently) committed by my client, but this must not be held against an entrepreneur, and we must not allow a live and reasonably healthy business to die. If this unfortunate thing were to happen, it would mean loss of jobs, and probably, loss of faith in the system. However, after relentless efforts, i can finally see some light at the end of tunnel. The reason i was able to persuade and help build consensus is because there are just a handful of decision makers involved at both ends. Also, the client in question is a privately-held business. I'm feeling relieved that i didn't have to deal with multiple approval (bureaucracy) bodies - board, investment committee, compliance committee, regulators etc. I'm also tempted to believe that a centralised decision making structure is some-times more efficient, than a de-centralized (federal) structure. Although my logic may be based more on emotional reasoning than scientific rigour and analysis; in times of crisis, emotions do tend to override pragmatism. 

If an informed person can experience such a dilemma, and grapple with such a moral conflict, i can only imagine the pain, chaos and confusion that must be going through less fortunate (read less informed) mortals. No wonder, people are increasingly feeling hopeless, and markets around the world are low in confidence. This is not the time for reflection, this is the time for action, and time is running out. If not for anything else, please bail-out the world economy for the sake of Democracy, and its ideals, on which the promise of the future of mankind depends. Democracy is OF-BY-&-FOR the people, and i don't believe 'People' want a long-drawn crisis. Do we really want the critics to point at Democracy as the reason for not being able to reach a concensus on a rescue plan, which is intended to rescue People?

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