Warren Buffett came to India. The closest I came to him is when my aircraft passed his (parked) private jet in Bangalore last week. Of course I was flying commercial. Thanks to a fairly trying schedule involving four cities in as many days I missed most of the media coverage surrounding his India visit. Which means, by deduction, I missed most of media too.
So why did we get so excited about Warren Buffet ? So one reason is the obvious one. He is the Sage Of Omaha. He is the most valued value investor. And for all the wealth his firm Berkshire Hathway generates, he himself lives the life of, well, a sage. Its perhaps the failing of my current assignment (or boon ?) that I only have time to browse a few reports and not take the full blast. It was in this context that I read T N Ninan's piece in Business Standard. I think it beautifully sums up the Sage's wisdom.
The second reason is the reason he came here. To invite India's rich (add recently rich) to part with their billions (in dollars). I could say a lot more on this to but I think the Business Standard's article titled `philanthropy mongering as PR' next day pretty much summed it up. I am not sure whether Buffett had success in either. But that can be assessed later.
From a vantage point, somewhere in south Mumbai, I was watching helicopters land and take off from the Mahalakshmi Race Course on Sunday morning. A friend pointed to Mukesh Ambani's 27-storey Antilla home (clearly visible from where we were standing) and added that he had applied for permission to land on his terrace. My friend being a pilot, presumably had an aviator's interest in landing and take-offs from a building terrace. Of course Antilla's in your face opulence was not lost on him.
To most, Antilla represents a pinnacle in Indian business achievement and sheer ostentatiousness. Although, its now difficult to say where one ends and the other begins. And therein lies the problem in India. So we like and respect success but are uncomfortable when someone brandishes his wealth and power so openly. More so in a nation where the disparities are so stark. Remember, we never saw it like this before either.
A Mukesh Ambani is not to blame for the disparities. He must, like all entrepreneurs big and small, be lauded for creating opportunity, jobs and Gross Domestic Product (GDP). Most of us accept that too. But then, why the discomfort ? I think its because of the concept of perceived equality. Which means that at one level we feel the very rich have taken from the Land and its People and not compensated sufficiently in return. On the other, the State has not done its job of giving us a good deal either.
You might argue that the entrepreneur is not to blame for this. True. But the State must fix the perceived gap between the entrepreneurs who mine (pun not intended) the resources the Land has to offer and the benefits that flow to the populace. It does not help that most of the wealth generated in the last decade has to do more with resources that were appropriated in ways and means that were mostly illegal. The 2G telecom scam is a good example.
But what if the State did a much better job in delivering services than it is currently ? I am not upset about a helicopter landing on someone's terrace and whisking him off. But I am surely upset at Mumbai's horrible roads, which surely hold the record for the most non-linear man-made construction on Planet Earth. Or Mumbai's domestic help who marvel at Mukesh Ambani's Rs 70 lakh ($143,000) monthly electricty bill when their homes an hour's train ride from Mumbai are beset with daily power cuts.
Its the distributed inequality that makes Warren Buffett and Bill Gates come and talk about philanthropy. There are two arguments here. First that most Indian businesses practice philanthropy and were not waiting for Mr Buffett to come and preach to them. The other is that philanthropy cannot fix the problems that we really want fixed. Even if the extent of philanthropy, lets say, doubled or even tripled.
So Who Fixes What ?
Most successful businessmen realise this too. They would rather contribute to the larger cause of opportunity creation (which India desperately needs) rather than Buffett-induced philanthropy which in a nation of a billion will always be a drop in the ocean. Unless you were someone like Azim Premji (Wipro chief) who talked about the deficits of education for a long time and finally decided he was going to put some money where his mouth was.
Can businessmen help the State deliver better services ? This is a tough one. The State does not like being told what or how to do. On the other hand, the same taxes you and I pay can deliver a better quality of life. We know this but have to find sufficient ways of enforcing better delivery from the State. We will. I also believe, however, that there is a case for more co-ordinated giving for larger objectives. What if the Ambanis, GMR Group, Birlas, Tatas and the thousands of new and very wealthy entrepreneurs combined their funds for a few specific causes ?
Its not something that any of them would jump to. After all, most of us like to leave our singular stamp on our giving. But for a country of this size, such efforts will bear more fruit. Particularly in areas like education and healthcare. And that's something that Mr Buffett figured too. By donating to the Gates Foundation rather than trying to do it himself. Thats a lesson we should surely take away.