Banks in India's Gilded Age

Jayant Sinha and Ashutosh Varshney, Financial Times, January 6 2011:

"...Both in its rot and heady dynamism, India is beginning to resemble America’s Gilded Age (1865-1900). Ending with Theodore Roosevelt’s rise to the presidency in 1901, the Gilded Age transformed an agrarian US into an economic and industrial giant. Yet Roosevelt’s assessment was gloomy: “The dull, purblind folly of the very rich men; their greed and ignorance, and the way in which they have unduly prospered...these facts, and the corruption in business and politics, have tended to produce a very unhealthy condition.”..."'



Samuel Brittan, Financial Times, June 5 2012:

"...In general terms it is difficult to go beyond Adam Smith. Few of us like competition; and the tendency to form closely knit groups to keep outsiders at bay is probably as old as the human race. For pre-capitalist examples one has only to think of the medieval guilds, whether of craftsmen or Master Singers. More subtle are the practices of bankers, as they come disguised as services for customers. In summary, success has depended more on whom you know than what you know. Hence the catchphrase “crony capitalism”..."

Jackson Lears, 'Something For Nothing/ Luck in America', 2003:

"In an laissez-faire economy, riddled by graft and scandal, robber barons and knights of the green baize were not always easy to tell apart."


Ajit Dayal, 'Why our bankers are like Gabbar Singh', June 20 2013:

"...Banking was a boring business.

But a lot has changed since Gabbar Singh took over. Now the banks are built to take risks and shed all fear of a serious reprimand. If "naming and shaming" had any relevance to the society we live in, most Indian industrialists (and many in the financial services industry) would be fakirs by now wandering aimlessly across the Indo-Gangetic plain in search of the mystical. Instead, they are surrounded by the material with some CSR to sprinkle around.

Which gets back to the other famous Gabbar quote: "Jo dar gaya, so mar gaya".

With no dar in the system, the mad expansion of bank branches will continue.

The mar will be for us."

 
I miss R K Laxman. He would have done real justice to the following news. 

"Reserve Bank of India (RBI) Deputy Governor K C Chakrabarty said banks had written off Rs 1 lakh crore in the past 13 years and criticised the lenders because as much as 95 per cent of these write-offs were for large borrowers.

“During the past 13 years what we see is that the banking system as a whole has written off more than Rs 1 lakh crore in advances,” Chakrabarty, the senior-most of the deputy governors  at RBI, said.
He said over 95 per cent of such write-offs have been observed in the case of big accounts and expressed anguish that public discourse focuses only on the government’s agricultural  debt waiver scheme of 2008. 

“We only talk about the debt waiver of the agricultural borrowers, we don't say big players and of this (Rs 1 lakh crore) 95 per cent are all big borrowers and it has been written off,” he said.

The government had announced a waiver of over Rs 60,000 crore in advances to the farm sector as a one-time measure in the Budget of 2008 following stress in the rural sector..."

(Business Standard, November 19 2013)

Laxman would have shown a marginal farmer with attendant goat, chicken and cow facing a 'fat cat' (like the one in the late Mr. Steig's picture below) and signed off with a killer caption summarizing the state of India's banking.



Artist: William Steig, The New Yorker, 2 July 1960
 
Here is a cartoon by Mr. Laxman similar to the one being imagined by me. It has a marginal farmer, his goat, a government minister and his secretary, complete with their chopper.

The caption given by the artist is:

"No, Sir, this is neither a flood hit nor a drought hit area. We are only hit by bad government!"

P Devarajan wrote in Business Line on October 15 2006:

“...For bankers in India, hopping from one air-conditioned room to another, funding the poor is a chore. Not an act of passionate conviction. “

Based on all of the above, my caption is:

"No, Sir,  I feel bad because I hear that my waived loan of Rs. ten thousand has resulted in bankrupting my bank."