World
American Diary: 9 days to go. It’s all about jobs, jobs, jobs

Obama may have made a big mistake when he did not lay out a jobs roadmap for his second term

Anyway you cut it, Americans have jobs on their mind. You might start a conversation about healthcare but they want to talk about jobs. You talk about the weather; they will want to talk about jobs—about having jobs, about not having jobs, about part-time jobs, about juggling jobs. Their main interest is jobs. Thus I think that President Obama made a big mistake when he did not lay out a jobs roadmap for his second term. He spoke of retraining and education, he spoke of green jobs. But that does not a jobs roadmap make. He should not have done it half-heartedly. He should have laid it out boldly. Maybe another stimulus, maybe a concession on the keystone pipeline. He should have laid out a plan and the numbers on it. Mitt Romney has filled the vacuum tube with his tax cuts and has promised 12 million jobs in four years.

My day began with breakfast of fried green tomatoes at the Eatonville restaurant, served by an impressive young black man called Rick Brown. He concurred with the view that the president was tired. His mother had been a liaison with the Congress and he talked of the sheer unrelenting strain of the job. He said the trouble was that the middle had vanished—there was no room for compromise. The president suffered from complacency.

I went to Richmond, the capital of Virginia and made my way to 1719-0 Franklin Street, the Virginia Democratic headquarters in a small nondescript street. I was shocked to find it closed. I wondered if was Obama pulling out of Virginia. Certainly not after the rousing speech in Byrd Park just a few days ago. So what was going on? Candace served me some food and came over to talk. She and her boyfriend, who was a film director, had just bought a house. They were here for the long run and yes she would be voting for the president.

Then Eddie took me in a cab around the city. I said let’s go to the Romney-Ryan office. That too was closed. Is Romney too pulling out of Virginia? Well, it seems weekends are off limits in Richmond. I asked Eddie how the Hispanics are going to vote and he said not one says Romney. Eddie is from Puerto Rico but many are concerned about their own or friends’ status. He said there were panhandlers at every street corner though I saw none and he had moved to Richmond because it was impossible to survive in New York. It was just too expensive. There are groups which feel an obvious loyalty to the president. His best bet is to ensure a large turnout in these groups. Maybe keeping the Richmond office open next Saturday may not be such a bad idea.

(Harsh Desai has done his BA in Political Science from St Xavier's College & Elphinstone College, Bombay and has done his Master's in Law from Columbia University in the city of New York. He is a practicing advocate at the Bombay High Court.)

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American Diary: 10 Days To Go-A Matter of perspective

It is day two of my US trip and 10 days to go before the election. “America is hurting” is what I see

 
I decide to meet up with the novelist Nayana Currimbhoy (Ms Timmins school For Girls) at her pretty loft in Lower Manhattan where her workspace and residence are cheek-by-jowl and get her perspective on issues. I ask her about the state of the economy. She runs an architecture firm along with her husband. Her view is that things are reasonably good but not like the boom years when everything was, so to speak, flying of the shelves. The job market is quite soft. “If you were to advertise for the post of an architect, it would probably get you hundreds of applications”, she says. The economic cycle is also a tad slow; payments for work done are a little late so work also gets somewhat delayed and it all adds up to a distinct perception of a slowdown. But Nayana doesn’t blame President Obama for this situation – “he inherited a terrible economy and Indians generally vote democratic-its an old tradition”, she says.
 
“How will the next four years under President Obama be any different?” I ask, “the Republicans in Congress blocked every democrat initiative, how will that change?” She
has no answer. Indians, who have a minority status as far as government jobs go, have benefitted from the President’s policy of reserving government contracts for minorities. That is bound to change if Mitt Romney comes to power. Also, since Indians are one of the richest communities in America, the tax policy should have its own implications on their wealth. Yet, Currimbhoy is confident that Indians will stick with the President this time around.
 
Our conversation veers around to the conservative stand against abortion and the landmark Roe vs. Wade case. This gets Nayana really animated at what she considers needless dabbling by the Republicans in social policy and issues such as abortion, or who should marry whom. It is a personal matter and the Tea party, which believes in individual freedom, should just keep of she thinks. But then, she also concedes that abortion and gay marriage may not be top-of-the mind issues for women this time – they are more keen on getting the economy back on track, which explains why the ratings show that Mitt Romney’s is closing the gender gap in the traditional Republican support base.
 
From meeting Ms Currimbhoy, I head off to take the Amtrack train to Washington DC. I am sitting next to a smart man who is using several devices to stay connected to the world. He works in health care communication and is from outside the Philadelphia area. I rib him a bit about the high cost of medicines and get him talking about President Obama’s health care plan. He thinks it is good in parts but needs some reworking to make it more acceptable to all. I also find out that he is definitely going to vote and he says a Republican. My new train friend is a father of two college-educated boys -- 26 and 28. Both have lost their jobs in the economic slowdown and are getting very frustrated at the slow pace of change. One son is into movie production and the other is an architect. Having lost his job, one now works as a cook and supplements his income by doing odd jobs. I opine that Mitt Romney as president will gut the economy. Amtrak here could go. So he says, “Should we become like Greece? Should we become like Spain? If Amtrak does not make money it should be privatized. That is the American way.” Crossing the lovely Delaware river, I ask my neighbour an executive with a Fortune 500 company “Isn’t that where Joe Biden comes from, and she says, they probably want to forget it”… Guys America is hurting.

(Harsh Desai has done his BA in Political Science from St Xavier's College & Elphinstone College, Bombay and has done his Master's in Law from Columbia University in the city of New York. He is a practicing advocate at the Bombay High Court.)

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Will the Zee Group get away this time too?

Zee and Subhash Chandra have always managed to escape from punishments in the past even when irregularities have been proven. However, this time they are facing a Congress MP and a powerful corporate who has right connections in place. Can Zee and Subhash Chandra escape this time?

 
Subhash Chandra and his Zee group have always got away lightly from all kind of troubles so far possibly due to the “right connections” in the government. In fact, it is easy to forget that the Zee group was one of the three or four that were closest to scamster Ketan Parekh of the stock market scam of 2000. The Zee stock was among the K-10. The ten scrips—Zee Telefilms, Himachal Futuristic, Satyam Computers, Global Telesystems, DSQ Software, Ranbaxy, Silverline, SSI, Aftek Infosys, and Pentamedia—were openly ramped up by Ketan Parekh, while the regulator, and the finance minister (Yashwant Sinha) watched indulgently. 
 
When the investigation into the scam started, it was found that Global Trust Bank (GTB) had rapidly routed money through a couple of Zee accounts in a single day in an unsuccessful bid to bail out Ketan Parekh. All this was documented by the Securities & Exchange Board of India (SEBI) and was on record with the Joint Parliamentary Committee (JPC). Even those days, the group and its media empire hit back at anyone who dared to write about the issue. A lackadaisical investigation was conducted by SEBI, which dragged for years and was to have been settled through a consent order. But suddenly, in the first week after CB Bhave was appointed chairman, in 2008, a whole-time member of SEBI passed a strange order allowing the group to get away with a mere warning. Not a single rupee was paid was as a fine. 
 
This time around, things are different. The Congress itself is under pressure over innumerable corruption scandals and the victim of alleged extortion by the Zee group is a powerful industrialist and Congress Member of Parliament (MP) Naveen Jindal. The chairman of Jindal Steel & Power is one of the most aggressive players in the steel sector and has hit back with a sting operation that has led to a couple of investigations. Jindal has alleged that Zee News and its senior journalists (who also double up as business heads) demanded Rs100 crore in advertising to suppress negative reports about his involvement in the coal mining scam. Although the charges made by Naveen Jindal are of a serious nature, it is not clear if he would take his legal action to its logical conclusion—after all he is a businessman and needs the media. However, a suo moto investigation has been ordered by justice JR Verma, chairman of the News Broadcasting Standards Authority (NBSA) and this will not be as easy to manage as a pliant and easy to pressure SEBI. 
  
It is worth going back in time to Zee’s involvement with Ketan Parekh. The share price of Zee Telefilms’ was ramped up almost 25 times from just Rs21 in March 1999 to around Rs490 in February 2000.  The Essel group (promoters of Zee) even gave an advance of Rs706.4 crore to Parekh, a part of which was later returned. Doesn’t this unexplained advance sound familiar to what several politician-‘entrepreneurs’ and famous sons-in-law have received in recent times?  
 
SEBI dragged on the investigation ordered by the JPC for eight long years after the scam. Then, to the shock of market observers, SEBI, under CB Bhave, allowed the company to walk away with a mere warning, after concluding that if found no nexus between the company and Ketan Parekh! 
  
The whole-time member, TC Nair, who passed on the order, concluded that “the promoters of Zee Telefilms had by their conduct and actions given an impression that they aided and abetted Ketan Parekh (KP) entities in large-scale market manipulation of various scrips, including Zee, during 1999-2001 period.” There was copious evidence of Zee Telefilms’ extraordinary fund transfers through accounts in GTB. 
 
This same member, was also guilty of earning a rent for hiring his flat to the Stock Holding Corporation of India (SHCIL)—a regulated entity—at Coimbatore where SHCIL had absolutely no business or operations. There was no action against Mr Nair, who in fact was expecting an extension when he passed the Zee Telefilms order. What was more shocking was that Zee Telefilms had been negotiating a consent penalty of Rs5 crore when Mr Nair let it get away with a warning.
 
Coming back to Jindal-Zee episode, earlier the Congress MP filed a first information report (FIR) against Subhash Chandra, chairman of Zee group, Punit Goenka, managing director of Zee, Sameer Ahluwalia and Sudhir Chaudhary, both editors and business heads of Zee Business channel.
 
The complaint also blames Zee group’s head Subhash Chandra. It says, “Aforesaid Sameer and Sudhir further informed us that a vilification campaign against our company is under instruction, consent and full knowledge of aforesaid Subhash Chandra and other officials of their top management. They further informed that Subhash Chandra Goyal was fully aware of this. In fact this whole thing was his plan and each step had his concurrence”.
 
The Zee group, however, denied the allegations made by Jindal. According to a PTI report, Punit Goenka, managing director and chief executive, Zee Entertainment Enterprises has said, “This kind of allegation has happened in the past and may happen in the future. It doesn’t make any difference to us and we will stick to the truth. These are all pressure tactics.”
 
Coming back to Global Trust Bank, it played the role of a ‘buddy’ lender to Ketan Parekh. However, after the exposure of its role in the Ketan Parekh scam, GTB was about to collapse before the Reserve Bank of India (RBI) arranged its shotgun marriage with Oriental Bank of Commerce (OBC). At that time OBC was among the best banks in India with the lowest percentage of bad loans or non-performing assets (NPAs). After GTB’s merger, OBC declared a loss during the fourth quarter ending March 2008 and 39% fall in net profit because of crippling Rs242 crore write-offs for amortisation of losses due to the merger. OBC’s total loss due to GTB was estimated to be around Rs1,220 crore.
 
OBC reported a net profit of Rs302 crore during the second quarter ended September 2012 mainly due to strong recovery of assets that had gone bad in the past. During the second quarter, OBC’s total recovery was Rs449 crore compared with Rs303 crore in the year-ago period.
 
So far, Subhash Chandra and Zee have escaped from any punishment. This underlines one simple fact—no matter what regulations the government puts in place, powerful corporates with excellent media and political connections are never punished. Instead, their mess is distributed across a few million small and tiny shareholders or depositors.
 
It would be interesting to see if Jindal, the powerful corporate and Congress MP would take this case to its right conclusion or Subhash Chandra and Zee again manage to get away. 
 

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COMMENTS

240p FLV

4 years ago

Excellent angle about the sordid Zee group and very relevant in today's context

Ravi Saboo

4 years ago

The article is bizzare, I could not understand what was the actual meaning of the T C Nair episode. What does it imply?

I presume that moneylife will have all the details regarding Mr.Naveen Jindal also about how he without the environment clearance still managed to erect the structure of the factory and win around 25% of the total coal blocks.

It would be better if you stick to the current scam then rather bring out the year 2000 scam as this will only raise and create doubts about your intention.

REPLY

Sucheta Dalal

In Reply to Ravi Saboo 4 years ago

Dear Mr Saboo... do read moneylife regularly. You will see that we cover everybody. No regular reader has any doubts about our intention.
And please believe that our readers are quite happy with ALL the scams that we cover... not just Zee, or Jindal, or Essar, or Ispat, or Reliance, or MLM schemes, or insurance shenanigans or regulatory lapses or banking quality issues.
Many thanks for discovering Moneylife. We hope you will be a regular.

Ravi Saboo

In Reply to Sucheta Dalal 4 years ago

Thank you for replying so promptly. I have been following your stories regularly, I am one of your followers on twitter.

Anyhow the main story about Zee being involved in a scam earlier was very confusing to say the least. The comment about T C Nair, about OBC merger and the fall in net profit were totally out of context.

Moreover I hope you will agree that it takes a lot of guts for anyone to take on Naveen Jindal who is in the central government in which all the top people are involved.

Please do not rake up old issues and mix it up with this.

Ravi

240p FLV

In Reply to Ravi Saboo 4 years ago

Take on Jindal? Hello, are living in a different planet or working for Zee? Look up the word extortion in dictionary since you don't seem to know what it means

NSriramamurty

4 years ago

Excellent with Full Details Exposing , for all of us.

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