Problems: local and global

Problems: local and global
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First Published: Tue, Nov 10 2009. 08 43 PM IST
Updated: Tue, Nov 10 2009. 08 43 PM IST
There is little in common between a Gandhian water activist and the global leaders who are trying to come to terms with issues such as economic instability and climate change.
I met Anupam Mishra at the recent TED India conference hosted at the Infosys campus in Mysore. He is a modest man who has much to be immodest about. Mishra spoke on how communities in the parched towns and villages of Rajasthan have over the centuries harnessed local knowledge and rules to collect and store the sparse rain that falls over the region.
His wise presentation was peppered with wry humour and ended with a standing ovation from the 1,000-plus audience. As he spoke, I kept getting reminded of the path-breaking work done by Elinor Ostrom on how common resources are managed, for which she won the 2009 Nobel Prize.
That evening, Rohini Nilekani introduced me to Mishra at a party on the lawns of one of Mysore’s palaces, and I tried to strike up a conversation over the deafening music. My main question to him: Was it easier for communities in dry areas to evolve rules on how to use water sparingly than in areas where rainfall is more abundant and the incentive to make common cause is less strong? How can rules be evolved in cities or in areas such as rural Maharashtra, where the powerful sugar lobby captures water resources?
Mishra agreed that there were situations where political solutions were needed. The music made further conversation impossible, but I went away with one unasked question: What did he think of economic solutions such as pricing of water?
The man who trudges through Rajasthan documenting traditional solutions to water shortage is a world removed from the men and women who have been busy trying to figure out how to avoid a repeat of the financial crisis and avert a climate crisis.
What they can learn from Anupam Mishra’s work is that there is nothing like a crisis to focus the mind. True, there are significant differences between the two situations, especially the nature of strategic interaction between participants in the process of finding solutions.
“A shared history of success in collective action is clearly relevant to current actors’ level of assurance about future cooperation… Researchers who study peasant village communities emphasize the importance of face-to-face relations among villagers; individuals know a good deal about the past behaviour of their neighbours, which can provide a better basis for predicting their future cooperative behaviour. And members of small, stable communities also know that they will need to interact with each other long into the future—increasing the cost of non-cooperation today,” notes Daniel Little on his blog Understanding Society, where he cites the work of Robert Netting and Robert Axelrod.
These conditions are not available to those who sit at the global high table. That is perhaps why political and economic solutions are more important when dealing with issues such as global imbalances and climate change. But a crisis can act like a glue to bring various nations and interest groups together in a consensus.
We saw something similar happening during our economic crisis in the summer of 1991. India stared down the abyss of bankruptcy. The sheer panic of a crisis provided Narasimha Rao and Manmohan Singh with the political space to push through long-overdue reforms that were on the drawing board for close to a decade.
Looking at how global economic policy has shaped up in the year after the worst moments of the financial crisis, it seems leaders have not used the opportunity to rewrite the rules of the game. Twelve months later, the way they managed to stem the panic, stabilize financial markets and prevent a total collapse in growth is commendable.
But there is a downside. The world is back to a regime of rock-bottom interest rates, asset bubbles and heavy currency interventions. Most economists agree the financial crisis had its roots in the problem of global imbalances—huge current account imbalances that were the natural corollary of the fact that the US was spending too much and China was saving too much.
Not much has been done to sort out this problem, even though the crisis did provide an opportunity. The world is dangerously similar to what it looked like in 2006 and early 2007.
It is the same set of leaders who will meet at Copenhagen in a few weeks to create a framework to manage climate change. That is a future crisis rather than a present one. Given the way the root causes of the financial crisis have not been tackled, it is clear that getting a strong consensus now on how to tackle a climate crisis that lies in the future will be incredibly difficult.
The scale of the problem is totally different, but can the world learn from the villagers of Rajasthan?
Niranjan Rajadhyaksha is managing editor of Mint. Your comments are welcome at cafeeconmics@livemint.com
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First Published: Tue, Nov 10 2009. 08 43 PM IST