Elections As Teachable Moments

By Rohan Samarajiva

Last December, as the presidential election campaign was heating up, I had to ponder the meaning of elections in Sri Lanka.  A Burmese graduate student from the National University of Singapore had come to study with me.  She was stunned by the plethora of graphic advertisements on display.  They have no elections in Burma and no illegal and environment-polluting posters and cut-outs in Singapore.  She asked: “They sell candidates like candy?” “Is this, what elections are about?”

Elections Sri Lanka style

In the absence of an Elections Commission, a Police Commission and an embedded democratic culture, it is not possible for the opposition to win an election in Sri Lanka, though it is possible for an inept government to lose one.

Seventeen years of unbroken rule, the effects of the 1987-89 crack-down on the JVP uprising, the acrimony around the split in the UNP and multiple assassinations combined to cause the ruling party to lose the 1994 elections.  Mismanagement of the war and the economy that led to the economy contracting for the first time since independence and overall loss of legitimacy caused the SLFP-led coalition to lose the 2001 General Election.

Opposition parties cannot win elections because the playing field is skewed.  Massive state resources are used to pulverize them; and the voters do not seem to think there is anything wrong with it.  Elections in Sri Lanka have little in common with the exercise of the franchise in democratic countries other than the name.

In our feudal culture, we convert Western institutions into forms that appear similar on the outside, but are feudal in content.  We did this to examinations, buy converting them into an admission procedure for a new caste system.  If at age 19-20, you qualify for admission to ‘engineering’ you gain admission to the new high caste.  If at the same examination, you qualify only for the National Diploma in Technology (taught at the same campus), you are assigned to a lower caste.  Any untoward behaviour would invoke violent responses similar to those engendered by perceived caste infractions.

In the same way, elections are not a contest of policy ideas as described in text books; they are the new modes of feudal succession.  The king has been anointed; now the battle is to see who gets to be regional chieftains.  As I said in an article that preceded the presidential election:

In the old days, the regional feudals gave the king revenue and troops, in exchange for the right to extract rents from the peasants.  Today, the regional feudals deliver votes to the king at periodic elections, in return for the right to extract rents from the private sector.  As in the old days, the sangha is consulted and placated by the king with Benz cars and assorted gifts (a practice not started by the present President) and serve as a weak check on his power.

So this is what elections are about.  In this context, there is greater value in marketing the preference number than in debating policy ideas.  If one is vying to be a regional chieftain, or even a simple courtier, why muddy the waters with rationality?  Just embed the preference number and feel-good images of The Man with babies, The Man with old ladies, The Man ploughing a paddy field, etc.  Pictures with the King?  Even better.

In the interstices of elections

But the new feudal system is unstable.  Law-governed societies are not willed into existence by the good and the wise.  They emerge when the feudal governing arrangements prove inadequate.  Most probably, the new feudal system cannot manage the Sri Lanka economy.  As I said in the same article quoted above:

It may be argued that today’s complex, globally-connected national economy cannot be effectively managed by a bunch of presidential cronies and that the procedures of representative democracy and checks and balances are essential, and that therefore, there is no alternative to constitutionalism.  It may also be argued that every country has a constitution and that over time, as the economy develops and matures, as was the case in South Korea and Taiwan, constitutionalism also takes root.

Like everything, the law-governed state has to be first imagined; then accepted; then created.  Our sham elections are opportunities for some of the imagining and accepting to occur.  We are not Burma.  Our people are well travelled and know the ways of the world.  They know that the bridges and roads advertised in election posters were actually tsunami aid, given by the now reviled, but still generous Western powers.  They know that life in countries with good governance is better than in countries without. That is why they take multi-day fishing vessels to Europe and not to nearby Burma.

Because there is a minority in the electorate that craves for more normal election messages, some candidates do appeal to their sensibilities.  And independent commentators can leverage this discourse to contribute to the emergence of a home-grown law-governed state.

Milinda Moragoda has made a habit out of running unconventional campaigns, abjuring posters and large rallies and giving primacy to ideas.  The UNP’s new face in Colombo, Shiral Laktilake, tries very hard to present substance.  Even Thilanga Sumathipala, locked in mortal combat with posterer-in-chief Duminda Silva, tries.  But he falls far short of debating ideas, simply going for a listing of achievements, a tad above Silva’s; “I brought smiles to faces that knew only tears.”

Elections are teachable moments, in addition to feudal succession rituals.  They prime audiences to think about the political and the policy-relevant.  If independent commentators can use the window to get some policy ideas into play, the days of new feudalism would be that much shorter.

An example: Counterproductive nationalism

Thilanga Sumathipala claims he got the job done, and wants the vote to do more of the same.

What caught my eye was his claim of credit for “breaking the telecom monopoly.”  I was at the table when he, as Chairman of Sri Lanka Telecom, fought tooth and nail to hold on to SLT’s misbegotten international telecom monopoly that was enriching illegal call terminators and those who facilitated their activities.  The monopoly was broken over his objections.  As a result, we today have a BPO industry and cheap international calls.

So what was this monopoly that he broke?  “An entity that was dependant (sic) on foreign experts was localised by the recruitment of local experts.  This generated a saving of over 50 million rupees, which was used to upgrade Sri Lanka Telecom . . .. Another feature of his leadership was in obtaining the first mobile telecommunications network for the Sri Lankan government . . ..  Mobitel is seen as the sole player to break the international monopoly on the mobile telecommunications sector . . ..”

Quite something else.  Not monopoly in the commonly understood sense, where the number of suppliers of a service is limited artificially, resulting in high prices, low quality and not all who want the good or service being served.  But this breaking of monopolies is metaphorical, whereby foreign personnel were replaced by locals and foreign-owned companies saw market share and revenues taken away by locally owned companies.

Let us examine these achievements.  Sri Lanka Telecom, a company still retaining many advantages from its monopoly days, suffered a loss of LKR 379 million in the last quarter of 2009 but ended the year with a net profit of LKR 785 million, a decrease of 89 percent from 2008.  Mobitel, SLT’s mobile arm, made a loss of LKR 395 million despite sales growth.

It is true that the management contract given to the Japanese investor was terminated when Sumathipala was Chair of SLT.  It is also true that SLT while he was Chair bought out the Australians who held 50 percent ownership of Mobitel and the right to manage it.  But both companies were profitable and SLT was a net contributor to the government from when it was a government department.  Now, with the job done by Sumathipala, they too have joined the club of loss-making government organisations.

In his defense, it must be stated that SLT made good profits for several years after Sumathipala’s management changes, even though Mobitel lost money for the first two years under the first CEO he appointed.  The strategies of the new management team resulted in market share and revenue gains in the short term, but took the entire industry down in the longer term.  It is not only SLT that is losing money now, the entire industry is.
Does this suggest that Sri Lankans cannot manage technology companies?  No.  In 1998, of the seven major telecom operating companies, only one had a Sri Lankan CEO.  He was a young man, not yet 30, in charge of the newest entrant.  That company is today one of the largest companies in the country and the market leader in mobile.  Today, there are at most two foreign telecom CEOs in the industry.  What this suggests is that Sri Lankan managers appointed by politicized and unaccountable boards cannot manage well.  If you take the government out of SLT, Sri Lankan managers can do well.

So what exactly was the job done?  The management of most telecom operators became local, naturally, except for SLT and Mobitel.  SLT is 45 percent foreign owned and because Mobitel is fully owned by SLT, it too is 45 percent foreign owned.  By removing a foreign management team that was put in place as a barrier to political interference, Sumathipala may have saved LKR 50 million then, but he cost the company (and in the end, the government and the citizens of this country) many multiples of 50 million in foregone profits and losses in subsequent years.

People who get their kicks doing business with locally owned telecos can give their money to Lanka Bell, the only fully Sri Lankan owned operator at this time, though that may change if the right price is offered.  Those who place value in Sri Lankan CEOs have a much broader choice.  But for those who like financially stable, profit-making companies that invest in future services, there is none, thanks to the job done by Sumathipala.

The limits of xenophobia

The President’s manifesto is applicable to the general election as well.  He wants baseline GDP growth of eight percent.  He wants Sri Lanka to be a   “Naval, Aviation, Commercial, Energy and Knowledge Hub.”
Neither of these objectives can be achieved without foreign investment and foreign skills.  We need more capital from outside because we do not save enough and we will not get concessional loans.  We need more foreign experts because our productivity is low and we cannot survive in the global economy without changing that.

Those running on the President’s manifesto, and even the President himself, should understand these truths.

There is no way you can continue to demonise the West and achieve eight per cent growth. The cheap, populist payoff is not worth the real cost. There is nothing abstract about this: Just look at what’s happened to what used to be the most successful sector in the economy, telecom.

Why vote?

Is there value in participating in the succession rituals of the new feudalism?  Only to the extent that one looks at who is putting good policy ideas into play and who is positioned to influence the government on those and other good ideas (not all the ideas have to be generated during election season).  The preference system does allow a thinking voter to do this, though for the most part it’s not easy to find three candidates who meet the criteria. I’ve mentioned one on each side in Colombo.

But unless we imagine the world we wish to live in, and get others to accept that vision, we will not be able to live in it.  This is the real task before us, not participation in the blood sport that goes by the name of elections.