Has Barack Obama's support slipped in the month of July?

There has been speculation -- reasonable and based on some empirics -- that Barack Obama may have slipped some in the match-up against John McCain in the presidential preference measurement. This slippage appears to have occurred since about July 4th weekend. For example, the fivethirtyeight.com model shows some downturn, and Michael Barone also appears to think so. The tracking polls by Rasmussen and Gall Up show the race to be with in 1-2 points.

However, I am not certain that the preference measurement data are clear on this matter. I think that we need to get some new preference data from Ohio and Indiana, and that will present a more clear pictures, The last preference measures from Ohio and Indiana showed Obama to be in slight lead (2-4 points) in Ohio, and essentially tied in Indiana. Here is my thinking --

(1) It is true that Obama's lead has shrunk in Maine from 20 plus points to about 9 points, it is also true that McCain's lead has ballooned to 20 plus points from about 9 points in Kansas (Rasmussen reports.) But it is also true that Obama's lead in California has expanded to 20 plus points from single digits (Field poll) and to double-digits in most East-coast states and robust numbers in Michigan (Quinnipiac, Sienna, Strategic Vision polls and Survey USA polls.)

(2) Michael Barone argues (July 16th) that "...if one assumes McCain is running a little stronger now, in which states would he be overtaking Obama, assuming a uniform rise across the country? In the South, Virginia (13 electoral votes). In the West, Colorado, Montana, New Mexico, and Oregon (24 electoral votes). In the Midwest, Indiana and Ohio (31 electoral votes). "

But recent preference measures (polls) taken after July 4th weekend show that Obama is leading by 4 points (about the same lead as in June) in Colorado, by about 9 points in Oregon (may be even a little bigger lead than in June), and he is tied with McCain in Virginia (about the same status as in June). There have not been preference measures in Montana, New Mexico and Indian and Ohio in the month of July. (Source, see RealClear Politics data). In any case, Barone's inference is inconsistent with data -- McCain is not leading in any of the states mentioned by him.

The state-by-state polls still appear to show the presidential race to be where it was in the month of June. Ohio will be a big one -- new polling data from Ohio will provide greater clarity.

Three important policy elements of the India-US Nuclear and 123 agreements

As India debates and will vote for the India-US Nuclear agreement through its members of parliament (it is a proxy vote in that the members of parliament will be voting whether the parliament trusts the current government or not), and as individual members of parliament are being tugged in different directions including their own conscience, there are three policy questions they should consider.

Based on their assessment on these three policy elements, the members of parliament should cast their votes.

(1) Will the safeguards agreement between India and the International Atomic Energy Agency (IAEA), and the exemption obtained from the Nuclear Suppliers' Group assure India uninterrupted supply of nuclear fuel and technology in perpetuity if India abides by the IAEA agreement even if the United States exercises the Hyde Amendment prerogative? (The Hyde Act in the India-US Nuclear agreement prohibits the U.S. administration from directly or indirectly assisting India with lifetime fuel supplies after suspension of the deal).

Simply put, is there separability between the agreement with IAEA and the Nuclear Suppliers' Group (bilateral 123 agreement), and the India-US Nuclear agreement?

The Indian government including Prime Minister ManMohan Singh and Congress party president Mrs. Sonia Gandhi appears to think that the answer to this question is "Yes". Several others -- policy leaders and scientists including P. K. Iyengar (former chairman, Atomic Energy Commission), A. Gopalakrishnan (former Atomic Energy Regulatory Board chief) and A.N. Prasad (former Bhabha Atomic Research Centre Director) assert that the answer is "No". (The three scientists, "Therefore, the government owes a clarification to the Parliament and the public about how they intend to avoid the consequential huge economic loss from the non-operation of these extremely costly imported reactors, as a result of fuel denial.”)

(2) Will the Nuclear agreement with the IAEA and the Nuclear Suppliers' Group (NSG), and/or the agreement with the United States weaken, in any manner, India’s nuclear deterrent and an ability to protect & promote indigenous R&D efforts in nuclear technology?

Simply put, will India's national security and/or sovereignty be compromised? The government says, "No". Others assert that the agreements would compromise the security interests at least some.

(3) Will the Nuclear agreement with the IAEA and the Nuclear Suppliers' Group (NSG), and/or the agreement with the United States have negative collateral effects on other areas of national interest such agriculture, defense and space?

Simply put, will India's national interests be protected? The government says, "Yes". Other including Placid Rodriguez assert that India's national interests may be compromised. (Rodgriguez, "My greatest reservation (about the deal) is that the strategic alliance between India and the US is going into agriculture because in the other three sectors (defence, space and nuclear) we are strong and we can go independently and we will go.)

The proposed agreement between India and International Atomic Energy Agency: Is it a prudent compromise or an unworkable compromise?

The draft text of the safeguards agreement between India's Department of Atomic Energy and International Atomic Energy Agency (IAEA) secretariat appears to be splitting the differences. That's good news. Sometime splitting the differences is prudent compromise, and at other times it kills the baby.

One of the key phrases in the agreement is “corrective measures”. Put simply, the agreement stipulates New Delhi’s right to act in the event of a breakdown of the agreement for international cooperation.

There are two sets of issues/concerns being raised about this phrase. First concern is about the palce ment of this phrase -- the reference to “corrective measures” appears only in the preambular section of the agreement, not in the body of the text. This should not be a major issue.

The second concern is about the meaning of “corrective measures”, which would become operational if the permanent safeguards and assured supplies breaks down. On permanent safeguards India offers the assurance “against withdrawal of safeguarded material from civilian use at any time”. At the same time, India wants to make sure that, after accepting safeguards, it should not be left high and dry on fuel supplies. Hence the compromise language in the IAEA draft affirms about “creating the necessary conditions for India to obtain access to the international fuel market, including reliable, uninterrupted and continuous access to fuel supplies from companies in several nations, as well as support for an Indian effort to develop a strategic reserve of nuclear fuel to guard against any disruption of supply over the lifetime of India’s reactors”.

This -- the focus on diversifying suppliers and the creation of a strategic reserve -- appears to ensure a lifetime supply covers many of the contingencies.

However, the stipulation is so vague and compromised that it has left all the constituents dissatisfied and anxious.

No one understands or knows for certain what this provision means, and/or when it would become operational. Being vague about the details of the provision has suited both the Government of India and IAEA but not the well-meaning interpreters of the agreement within and without the country.

The Indian citizens are worried that India may be caught in a nuclear bind (of interrupted supplied), and the Non-proliferation critics in the U.S. and other parts of the globe are worried that India may exploit the provision for furtherance of its nuclear goals. So there you have it -- splitting the differences may prove to be suboptimal.

The draft text as provided by The Times of India can be accessed at the following link --

draft-text_iaeaindia_toi-july-10

Indian policy leaders and citizens have to carefully consider the geopolitics in assessing the India-US Nuclear agreement

As India debates the merits of the India-US Nuclear agreement (123 agreement), public policy leaders and citizens one must consider three the current and potential geopolitics in determining the acceptability of the India-US Nuclear agreement. There are at least three different elements to be considered --

(1) The Larry Pressler Amendment which was in effect in the U.S. with regard to the export/sale of military technology to Pakistan mandated that the President of the United States had to certify to the U.S. Congress that Pakistan was not misusing the military technology. In 1990 the unthinkable happened. Pakistan had paid billion of dollars for the purchase of more than F-16 fighter aircrafts. But the then President George H.W. Bush refused to provide the certification, and Pakistan was denied the F-16 fighter aircrafts though it had paid for them. Pakistan had got those aircrafts in 2005-2006 when President Bush decided to grant India exemption from the sale of nuclear technology and fuel.

(2) We should remember that first nuclear power station -- Tarapur Atomic Power Station -- built in India ran into serious difficulties in the 1960s. The nuclear power station was built with the help of the US and Europe, and with the assurance of continuous nuclear fuel supply. However, because of many domestic and global pressures including the pressure of the Non-proliferation advocates, the United States and France pulled out of the agreement abruptly. India was stranded but thanks to the leadership of the Indian scientists and the political leadership including Mrs. Indira Gandhi, India developed the nuclear and space technology indigenously.

Congratulations to India that in spite of the attempts to impute a variety of motives to India, India never pulled the Tarapur Atomic Power Station out of the IAEA safeguards.

(3) Assuming that the Nuclear agreement is consummated, what will India do if any party -- be it India or the U.S. (because of Hyde Amendment) -- reneges from the agreement in the future? Where will India go for the nuclear fuel and technology? Imagine the scenario twenty-years from now. Assume India has 30 nuclear power plants in different parts of the country and abruptly India loses supply of most of the fuel. That would be disastrous.

The world certainly has changed the 1960s and even from 1990 but it is also likely to change again in 20 years. India should, therefore, consider the geopolitics of the nuclear agreement. dispassionately.

Tough economic times in India in the midst of ferocious Nuclear debate

As the Indian government's energies are absorbed in the debate over India-US Nuclear agreement (123 agreement), the country's economy is showing serious strains. India's economy is now faced with trio challenges -- rising oil prices, worrisome inflation, and depreciation of Indian rupee.

This is not good news for the country, and not for the ruling coalition of parties who have to face the electorate in the next 8-10 months.

Just look at some of the data. Inflation is at an alarming 10-11 percent annual rate corroding the purchasing power of all the citizens. Food and energy prices are skyrocketing. India is seeking a consensus for a regulated bandwidth of price for oil.

The Indian currency -- Rupee -- is depreciating because of the inflationary pressures. The trade deficit is growing.

For example, on Monday, June 30th, the market capitalization of the Indian financial markets was about one trillion dollars. So was the size of the Indian economy. But on Tuesday, July 1st that was not the case.

Bombay Stock Exchange closed on June 30th with a market capitalization of about $1.02 trillion. On Tuesday, a fall of 500 points in the Sensex and a gain of 32 Indian paise (100 paise = 1 Indian rupee) for the dollar against the rupee saw that figure drop to $970 billion.

Similarly, India's Gross Domestic Product for 2007-08, valued at Indian rupees (Rs) 43,02,654 crore, translated into just over $1 trillion as valued at exchange rate on June 30th. With the dollar appreciating against the Indian rupees and crossing the Rs 43 bench mark on July 1st, the India economy was down to $995billion.

High oil prices have seen India’s oil import bill rise to $16.5billion for April-May this year, up 49 percent from the figure for the same months of 2007. As a result, the overall import bill has risen by 32% to $48.8b. Despite the fact that exports have grown at 22%, the trade deficit has risen to $20.6 billion -- up about 48 percent.

The widening trade deficit has added to the demand for dollars as against Indian rupees. So while the U.S. dollar has been generally depreciating against most currencies, it has been appreciating against the Indian rupee. The exchange rate is over 43 Indian rupees.

President Bush's decision to attend the Olympic games in China

President Bush has announced that he will attend the opening ceremonies of the Olympic games in Beijing, China next month. Simply put, the President did not want to insult China. Historically and culturally, Chinese citizens are nationalistic and take affront rather easily (and hold these grudges for a long time) to any perceived insult to their country, culture and society.

So what is the point in leaving the Chinese political leadership all upset with the United States? After all, the next President -- whoever it is -- will have to face the consequences of that. President Bush has made the right decision in not complicating the governance for the next President -- after all, President Bush is in the last 6 months of his presidency.

The responsibility and restraint shown by President Bush is to be lauded though it can be argued that China should not be rewarded for its strong arm tactics with Tibetan people and other human rights issues. May be President Bush would have not attended the opening ceremonies if he had at least one full year -- if not more -- to deal with the fall-out of such a decision instead of leaving that to the next President.

After all, President Bush has has been clear in always identifying China as a "competitor." President Bush has also been respectful of Dalai Lama and the Tibetan aspirations. So instinctively President Bush would have wanted to keep away from the Olympic games but he made the right strategic decision.

What is the thinking on Iran-India Gas Pipeline?

For quite sometime now (since 1990), India and Pakistan have been discussing -- on and off -- transporting gas (natural gas) from Iran oilfields to India. The pipeline for such transport from Iran to India will be through Pakistan and even some parts of Afghanistan. That and the enormous estimated cost ($7.5 billion) make the proposition very complicated, if not almost impossible. There are challenging political, economic and diplomatic considerations. Here are just a few --

Assuming that the India-Pakistan political and economic relations are honky-dory, Afghanistan is a mine-field. The political uncertainty and instability in Afghanistan for the last 30 years is evident. So how will the safety of the pipeline be assured? What is the guarantee that the pipeline will not become hostage to political and even religious angst and anger?

Of course, the relations between Pakistan and India is far from reliable. Even as late as in years 1999-2000, India and Pakistan were poised to go to war. Of course, there are constant disagreements over small and big issues -- terrorism, cross-border military incursions, perceptions of slight.

Most difficult of all these challenges is the Kashmir valley. The Kashmir valley issue has no solution at all. Pakistan political leaders are unlikely to ever give up the claim that Kashmir valley should be transferred to Pakistan -- in fact, no Pakistan political leader can afford to do this politically. Of course, India will never let anyone impinge or question its sovereignty -- Kashmir is an integral part of India. If Kashmir valley was not such a narrow and small geographic area, and if there were some natural geographic divides, may be there could have been some give-and-take on the land. But that is not the case.

What if the Iran-Pakistan-India pipeline becomes a reality, and India starts using the enormous amount of natural gas for consumer and industrial purposes, and five years down the road, some political leader in Pakistan or some terrorist in Afghanistan decides to hold the pipeline hostage? India's economy will suffer devastating consequences.

What if Iran decides to raise the price of the natural gas? By supplying such large volumes of natural gas, and with the economic necessity of using the pipeline, Iran will have a near-monopolistic power. Even as the project is on the drawing board, Iran has already demonstrated its unreliability. So what can be of the future?

The pipeline project reached a setback on July 16, 2006 when Iran demanded a price of $7.20 per million British thermal unit ($6.80/GJ) of gas against India's offer of $4.20 per million British thermal unit ($4.00/GJ). The Indian spokesperson then stated that the price demanded by by Iran was more than 50 percent above the prevailing market price in India. India and Pakistan finally agreed in February 2007 to pay Iran $4.93 per million British thermal units ($4.67/GJ) but some details relating to price adjustment remained open to further negotiation.

Finally, the political instability and volatility in Iran is too obvious.

Given all these risks, it is not at all clear why India is investing so much time and effort in exploring this alluring but illusional opportunity.

Added to all these complications are two other elements. First, the United States is stoutly against this project as the U.S. is against any relations with Iran. That political reality may soften but it is not likely to change completely. Both Pakistan and India want the good will of the United States for different reasons -- for security reasons for Pakistan and for aspirational reasons for India. Second, China now wants to be part of this project adding to another level of complexity.

So why this project? It just does not add up.

Background: The project was mooted in 1990 with expectations that it will benefit both India and Pakistan, who do not have sufficient natural gas to meet their rapidly increasing domestic demand for energy. The IPI pipeline is a proposed 2,775-km-long pipeline to deliver natural gas from Iran to Pakistan and India. According to the project proposal, the pipeline will begin from Asalouyeh and stretch over 1,100 km through Iran. In Pakistan, it will pass through Balochistan and Sindh but officials now say the route may be changed if China agrees to the project. The gas will be supplied from the South Pars field. The initial capacity of the pipeline will be 22 billion cubic meter of natural gas per annum, which is expected to be later raised to 55 billion cubic metre. It is expected to cost $7.5 billion.

Barack Obama and the gallop to the Politcal Middle

Barack Obama is racing to the political center, ready to defy stereo-types (e.g. a weak liberal) and spar with John McCain. In this regard, Obama has made several decisions by Obama in the last month or two.

Among those decisions are Obama's solemn undertaking to protect Israel, in a speech to the leading pro-Israeli lobby (AIPAC); Obama's nuanced welcome of U.S. Supreme Court's decisions affirming the right to bear arms by individuals, and the right of appeal to Guantanamo detainees, and gentle disagreement with the Supreme Court's decision rejecting death-penalty for child-rape; Obama's acceptance of the compromise in the Foreign Intelligence Surveillance Act (FISA), which contains a provision granting telecoms companies immunity from lawsuits for co-operating in a surveillance program that conducted wiretaps without warrants;Obama's efforts to lower the rhetoric on free trade and NAFTA, and increased recognition of the importance of trade and markets; and Obama's support and even a call for expansion of faith-based initiatives and programs, and recognition of faith-based community groups.

And now Obama, while sticking to his argument that Iraq war was unjustified and should not have been authorized, affirms that he will listen closely to the advice of the military leaders. While Obama says that the his plan to withdraw the troops in 16 months -- one brigade a month -- is firm, he also suggests that he will "refine" and recalibrate the actual details. Per media reports, Obama said,“What I said this morning what I will repeat, because its consistent with what I have said over the last two years, is that in putting this plan together I will always listen to the advice of commanders on the ground but that ultimately I am the person thats making the strategic decisions.”

Finally, Obama has set a somewhat rigorous condition (surprisingly, so) for later-term abortions. In an interview this week with Relevant, a Christian magazine, Obama said prohibitions on late-term abortions must contain "a strict, well defined exception for the health of the mother." Obama then added: "Now, I don't think that 'mental distress' qualifies as the health of the mother. I think it has to be a serious physical issue that arises in pregnancy, where there are real, significant problems to the mother carrying that child to term."

All these decisions -- and nuanced statements -- move Obama to the political middle, and make it a challenge to categorize and stereo-type him. However, when does that journey to the middle starts to appear a bit opportunistic? Time will tell though so far, I think, that Obama has maintained a sense of authenticity in his journey to the middle. In general, Obama appears to be thoughtful and making sensible changes based on empirics.

The winners and losers in the Indian debate of the India-US Nuclear agreement

The India-US Nuclear agreement (123) debate is furious in India. The coaltion government led by Congress party, and the Prime Minister Manmohan Singh are finally determined to have a go at the nuclear agreement. The communist parties with about 60 parliamentary (Lok Sabha) members are about to withdraw their support to the coalition government but the Samajwadi Party led by Mulayam Singh with about 39 parliament members are all set to support the government.

There is ferocious finger-pointing and heated rhetoric in the Indian debate. Without considering the substance or merit of the agreement, I rate as follows the winners and losers of this debate. I rate on a 1-10 scale, 1 being a perfect loser, 10 being a perfect winner and 5 being no-loss and no-gain.

(1) Congress Party: I give a 5. By pushing aggressively for the consummation of the 123 agreement, the Congress party reinforces its standing as a national party which protects and furthers the country's interests above its own party interests. But the near-collapse of the political alignments for (governance) now and for the forthcoming elections, and the great uncertainty about the final approval of the agreement by the U.S. Congress in good time, and the eventuality that even if the agreement is consummated the United States invokes the Hyde Amendment are too many potential negatives that it make it a 5 for the Congress party.

(2) Mrs. Sonia Gandhi: I give a 5 for the same reasons. The political downsides are too many. But I do laud her ability to put the national interest above the partisan interest.

(3) Prime Minister Manmohan Singh: I give him an 8. Even if the Congress party and its allies were to form the next government after the parliamentary elections, it is most likely that Manmohan Singh will be nominated/elected to be the Prime Minister again. Manmohan Singh is, most likely, concluding his serendipitous political life -- first as much hailed reformist Finance Minister and now as the Prime Minister. Given these facts, how can there be a more lasting and memorable legacy than the consummation of this extra-ordinary nuclear agreement?

(4) The political allies of the Congress party: I give them a 5. What are their choices -- be with the Congress party or with the other political party -- BJP.

(5) Bharatiya Janata Party: I give an 8. The Congress party and its political allies won the 2004 parliamentary elections simply because their collection of parties was larger than that of the Bharatiya Janata Party and its allies. Take, for example, the state of Maharashtra. The coalition Congress party, the National Congress party led by Sharad Pawar and the Communist parties clearly outdid the combine of Bharatiya Janata Party and Shiv Sena. And so went the story in state after state.

But now the opposition to BJP and its political friends is now fragmented -- most states are likely to witness a triangular contest with Congress and its friends as one contestant, the BJP and its friends as the other contestant, and the Communist parties and other small regional groupings as the third contestant. In such a fragmented contest, BJP is likely to benefit very substantially.

Add to this, the opportunity to woo the Muslim voters who are deeply suspicious of the United States -- not unlike the Muslims all over the world after 9/11.

(6) Lal Krishna Advani: I give him a 9. For a man who is 80 years old and who is not seen as a statesman, and who was almost cast away by his own party after his favorable remarks about Jinnah in 2005, there is a remarkable turn-around in fortunes.

The near implausibility of getting the India-US Nuclear agreement approved?

Let us put aside the substance and merit (or lack thereof) of the proposed India-US Nuclear agreement. Let us examine plausibility of getting the India-US Nuclear agreement done now that the Indian government appears to want to get the agreement done -- the United States government has been waiting on the Indian government.

But here is the timetable --

The next step is negotiations and discussions with International Atomic Energy Agency (IAEA), and getting the India-specific elements ratified by the Board of IAEA. This could take 2-3 months.

Subsequently, the agreement has to be discussed and approved by a Nuclear Suppliers' Group (NSG) for the exemption from the ban on supplying nuclear technology to countries that have not signed the Nuclear Non-proliferation Treaty (NPT.) NSG is a group of countries that would eventually supply the nuclear technology (fuel and hardware) to India. And this process could take additional couple of months.

Even if the IAEA and NSG approvals are processed simultaneously, the agreements cannot be completed till September.

So the U.S. Congress cannot consider the agreement -- 123 agreement, IAEA safeguards,and NSG exemption -- till after the November congressional elections which are certain to increase the majority of the Democratic party in the House of Representatives and the Senate, and may be even elect Barack Obama to the Presidency.

Given that the Democrats are strongly concerned about Nuclear Non-Proliferation (NPT), the Nuclear agreement may be received with lots of skepticism in the U.S. Congress. Though the Nuclear agreement would be considered by the lame-duck congress (so the additional electoral Democratic strength will not be reflected), the Democratic leadership can easily derail the consideration of the agreement -- it the leadership so chooses -- by the new congress as Democrats (by virtue of their majority status) control the flow of the bills for consideration.

So the plausibility of getting agreement ratified completely appears dim given this late-hour start.

The New York Times (in a recent editorial) criticizes the India-US Nuclear agreement as too generous and a give away of the the store to India. Of course, this is exactly the opposite of the objections raised by the Communists and the Bharatiya Janata Party in India -- their objections are that the Nuclear agreement potentially impinges upon India's sovereignty and restricts India's future options.

The agreement cannot be placed, if at all, before the U.S. Congress for its consideration and approval before the November elections when the Democratic party is likely to add to its majority in both the Houses of Congress, and may even capture the White House. The Democratic party leaders -- Joe Biden, Barack Obama -- have expressed serious reservations about the agreement.

Given all these facts, and the fact that President Bush's (the champion of the agreement) approval ratings are likely to be hovering in the low 30s, the chances of the agreement being approved by the U.S. Congress is diminishing rapidly.

In the meantime, Lal Krishna Advani is asking for a quick (short) parliamentary session of the Indian parliament houses (Lok Sabha and Rajya Sabha) where the nuclear agreement can be debated and voted either up or down. Congress party and its governing allies are averse to this.

If the Congress party, Mrs. Sonia Gandhi, and Prime Minister Manmohan Singh were willing to sacrifice power for the consummation of the nuclear agreement (and that is quite noble, indeed), how one wishes the party had moved ahead at least 3-4 months back!

The politics of India-US Nuclear agreement

Thus far, the political alignments in India in the so-called 123 agreement (India-US Nuclear agreement) have been clear.

Prime Minister Manmohan Singh and the Congress party has always seen the Nuclear agreement as strategically beneficial to India (after all, it was Manmohan Singh who negotiated the agreement with President Bush, and Mrs. Sonia Gandhi is obviously now persuaded that Manmohan Singh's analyses is quite correct.) They do so now with greater urgency and vehemence. The political and governing allies of Congress party such as DMK, NCP, RLD and others have also been persuaded that the Nuclear agreement is good for India.

The communist parties objected to the 123 agreement largely on the basis of Hyde Amendment which includes great uncertainty for ever because the President of the United states has to certify every year about India's compliance with respect to clear segregation of military and civilian nuclear programs in India. Here is the catch. Let us, say, India relying on the certitude of the 123 agreement goes on to build dozens of nuclear plants for industrial and domestic power. Let us, again say, some 30 years from now some President of the United States refuses to certify to the U.S. Congress India's compliance with the 123 agreement. What will happen? Nuclear technology and fuel supply to India will come to a grinding halt. What does India do then? That's the questions and the catch.

In any case, may be the communists have not been hopeful but they are at least analytical.

BJP and its allies have, most predictably, opposed the 123 agreement but not necessarily with much force of analyses.

So that has brought the Indian government in a predicament. Without the communists' support, the government could collapse.

Then came the savior in the form of Samajwadi Party with about 39 members of parliament. However, the Samajwadi Party developed cold feet when its political allies like Telugu Desam put political pressure. Then this grouping -- Samajwadi party and Telugu Desam and other parties -- announced that they will seek the expert counsel of former President Abdul Kalam.

Per newspaper reports, Abdul Kalam has affirmed that the nuclear agreement was beneficial for the country. So far, so good. But Kalam also purportedly advised that, “India can scrap nuclear deal anytime if warranted." Okay but what will that do? If 30 years from now, India feels harassed and wants to scrap the deal, where will the nuclear fuel and technology come from?

It does not matter who might abrogate the deal -- India or the U.S. -- the uncertainty and potential catch caused by the Hyde Amendment. It is that simple.

And finally, this -- the communist parties and the Prime Mininster are accusing each other of less-than-honest dialogue and conversation. The latest salvo comes from the Prime Minister, and here is the Prime Minister's chronology of events as reported in the media.

"Singh had concluded in August last year that the CPI(M)’s Prakash Karat was uninterested in the merits of the nuclear deal, that his opposition was ideological and not rational. When the actual nuclear text, the so-called 123 agreement, was being negotiated, Singh had ordered National Security Adviser MK Narayanan and atomic energy czar Anil Kakodkar to ensure all the nine demands regarding the deal raised by Sitaram Yechury in Parliament in 2007 were addressed. When the 123 agreement was finalized in late July last year, Singh called in leaders of both the BJP and the Left and showed them the text. The BJP leaders made no complaints. One of them even praised the Indian negotiators. The Left leaders only said they would study the text. Singh was watching TV several days later, and saw Karat demand the Congress “press the pause button” on the deal. At this point, the PM concluded that the Left would never be won over, though he did make one appeal to the Bengal communists in an interview to a Kolkata daily."

McCain, Obama and the Finances

Senator Barack Obama has opted out of the public financing system in his contest for the U.S Presidency, and John McCain has decided to stay in the system. It appears that Obama may have about $250 million to invest in the months of September and October, and McCain may have only about $85 million.

Should McCain be afraid? No and Yes.

No, because I do not think that Obama's financial edge will do much for him in advertising (traditional and non-traditional) for his candidacy and causes. The reason is simple -- time is short, and there will be galore free publicity. Here are some ways that Obama may use his financial resources to increase the scale and scope of advertising. Let us look at various elements of this advertising.

First, Obama can and will probably advertise in almost all the 50 states -- even as his campaign will concede that several states like Alaska have not voted for a Democratic candidate for a very long time. The goal of this exercise to merely scare up McCain's campaign and force him to spend some of his valuable resources -- money and time -- in some of those states lest he should lose. Will this be effective? I rate the effectiveness about 3 on a 1-10 scale (10 being most effective) because when push comes to shove McCain will not divert his resources (he cannot afford to) and thus would call the bluff (not out of choice but out of necessity.)

Second, Obama can use micro-segmenting and try and use different media for diffusing his image. Money provides that luxury. Obama can also try non-traditional approaches and media.

Will be this an effective strategy? Better than the 50-states strategy but not overwhelmingly so. I would rate this strategy to be about 5. The reason is simple. The Presidential race will get plenty of free media coverage from networks, cable channels, print media, blogs, u-tube productions and those Presidential debates. Additional reach -- over and above these -- is likely to have marginal impact. Further, the content/message of the candidate does matter.

The message will determine the basic positioning of the candidate, and no amount of volume of reach can necessarily change that positioning. Two examples of this are: one, though Barack Obama invested thrice as much as Hillary Clinton in Pennsylvania Democratic primary and twice as much in Ohio, the ultimate preference numbers did not change from the forecasts three weeks before the actual voting; two, with less than $1 million investment the 'Swift Boat' advertisement against John Kerry was devastatingly effective. In the first case, the message was the same but in the second case, the message was sharply different and new (whether that was true or not is besides the point -- further, since Senator Kerry did not effectively and immediately repudiate the attacks the message assumed a level of truthfulness as a default.)

Final aspect of this element is that Obama is likely to receive somewhat of a negative coverage from the mainstream media for his rejection of public financing -- this is not huge but one cannot ignore the word-of-mouth value of major networks and newspapers. In this case, the word-of-mouth effect would be negative.

Yes, because Obama might gain a very substantial advantage in voter registration, and mobilization with paid staff and localized promotion and patronage. It takes almost one-on-one to persuade a voter to register, and then actually vote on the election day. The upside of such voter mobilization is monumental. Particularly when the enthusiasm for McCain's candidacy is somewhat muted thus far. For example, in the recent USA Today-Gall Up survey 61% of Democrats said they were more enthusiastic than usual about voting in this year's election, while just 35% of Republicans said that.

Obama can employ this vast resource to mobilizing voters through registering new voters and individual contacts -- paid staff (and volunteers) knocking on the doors, telephonic calls, mobilization on the day of the election. Here, the resources can make a very big impact. I would rate the potential effectiveness of this approach about 7. There is substantially higher marginal benefit to be achieved here.

For illustration, let us examine Ohio (20 electoral votes.) In 2000, Al Gore lost the state only by about 350,000 votes even without any campaign investment. In 2004, John Kerry lost Ohio by less than 120,000 votes. If only Kerry had mobilized 10 extra votes in every precinct in Ohio, he would have won Ohio and the Presidency. Obama can pour his resources in the ground game in Ohio and quite possibly win it given the current sour political climate. Similarly, Kerry lost New Mexico and Iowa by less than 20,000 votes each -- and that can be easily overcome with strong election-day mobilization. In a state like Georgia where about 600,000 African-Americans have not registered to vote are rich Obama-votes. If they can be mobilized to register to vote and actually turn up to vote, Obama can put Georgia in play. In Florida, more than half a million black registered voters stayed home in 2004. Hundreds of thousands more African Americans are eligible to vote but not registered.

Off-shore drilling: The case by and for McCain

McCain has reversed his stance against off-shore drilling, and now advocates it. Obama continues to oppose this. The U.S. Congress currently has a statutory ban on off-shore drilling. What are the pros and cons?

With the high gas prices and improved technologies, voters are open to this idea -- all public polls show that 55-60 percent of Americans support off-shore drilling. It is estimated that there may be about 21 billion barrels of proven oil reserves that are left untouched because of a federal moratorium on offshore exploration and production.

So that should help McCain, right? Not much for two reasons. One, the voters will always be reminded that McCain might be opportunistic and runs counter to McCain's tough-it-out but do the right thing image. Two, the blue-collar, working class, lower income voters who are most affected by high gas prices are also surprisingly principled and tough (they would rather tough it), so McCain may gain no traction with this most plausible demographic group.

The principled-stubbornness of the working class demographic group came to most vivid demonstration when Clinton's advocacy of temporary suspension of gas tax (and Obama's opposition) did not fetch her any favors with this group in the Democratic primaries.

Finally, even if the federal ban on the off-shore drilling was removed it would be a long time before there can be any potential oil production because the individual states such as California and Florida have to make their own determination and then the business of drilling oil has to begin.

India-US Nuclear Agreement -- An Update

The India-US Nuclear agreement is the subject of hope and debate, yet again, in India. Apart from the substance of the pact, the politics (and timing) of the negotiations are mystifying.

First, the substance of the pact. The benefits -- immediate access to nuclear technology and nuclear fuel -- are very robust. India's need for energy is monumental and nuclear energy must form a part of the energy portfolio for India.

The United States -- President Bush -- has made an extra-ordinary offer to India. The President is championing exception (for India) to the 1978 congressional mandate that the non-signatories of Nuclear Non-Proliferation Act cannot under any circumstances receive any nuclear technology or fuel from the United States. The so-called Nuclear Suppliers Group follow the United States lead on this matter.

So this is truly historic. India owes a debt of gratitude to President Bush and the United States. However, the Hyde Amendment is troublesome.

The Hyde Amendment which requires the President to advise the Congress every year that India was not diverting nuclear technology and material for weaponry. While it is very true that President George Bush has high respect for India’s integrity and trust. However, what the political landscape would be in 10 or 20 years is anyone guess – it is not clear that a nation’s future can be so tenuously linked to certification by an individual. Look at what happened to Pakistan. The then President Bush in 1990 failed to certify Pakistan’s intentions regarding its nuclear ambitions, and the Pressler amendment called for economic and military sanctions which reverberated till recently.

But President Bush cannot do much about Hyde Amendment -- this is the requirement that the U.S. Congress is imposing for the extra-ordinary exception that it is ready to make for India. This requirement is entirely reasonable from the perspective of Congress, however troublesome that it may be to India or subject to the vagaries of time and the whims and fancies of a future President who may be annoyed with India on some other matter and may decide not to certify based on that irritation. There is no basis on which President Bush can push the Congress to do away with the Hyde Amendment -- President Bush is already facing strong opposition from the Congress, particularly from the Democrats.

Having said this, if India is ready to accept the risk with the Hyde Amendment the Indian Government must have moved with greater dispatch. It was India's responsibility to sign India-specific accords with the International Atomic Energy Agency (IAEA) before the U.S. Congress can approve the nuclear agreement.

But India has dithered on this matter for almost one year. That is because of the Communists parties who have about 60 parliamentary seats and who have been electoral partners with Congress party are strongly opposed the nuclear agreement -- their opposition is well thought-out, and it is mostly based on the Hyde Amendment.

The Congress party has spent one year trying to persuade the Communists parties -- and it has not been successful. Finally, the Congress party is threatening to go ahead with the negotiations with IAEA but why now? This is so late.

By the time, India concludes its negotiations with IAEA it will be atleast a couple of months. So the agreement cannot placed before the U.S. Congress before fall. But the agenda for fall for the Congress is set in place -- and the Congressional leaders have already said that it is too late for debate and approval of the nuclear agreement.

Unfortunately, President Bush can do only so much -- particularly with the U.S. Presidential and congressional elections looming ahead so close. Once the November elections take place (Democratic party is likely to gain substantial number of seats in the U.S. Senate and the House of Representatives, and quite likely even the White House), President Bush's influence will diminish dramatically.

So what is point of Congress party being so decisive so late? It appears that the Congress party did not want to risk alienating the Communist parties but now since the national elections are only 6-9 months away the Congress party appears ready to roll the dice. Politically, that is not in the self-interest of the Congress party. Unless the Congress party can hold the Communist parties in its fold for the next general elections, its probability of winning those elections will diminish dramatically.

So what is the point? It just does not compute. The nuclear agreement is most unlikely to be approved by the U.S. Congress given the serious time constraints and the dynamics of U.S. political environment. The Congress party is also likely to lower its odds of winning the next elections.

The probability of Obama winning the Presidential Elections

The probability of Obama winning the Presidential elections in November appears to be pretty robust. Here is why --

(1) Based on public polls, it is becoming evident that Obama is most likely to hold all the states (Michigan appears close but it is trending Obama's way) that Kerry won in 2004. That would give Obama 252 electoral votes. Add to this Iowa which is almost certain to go to Obama -- 7 electoral votes. That gives Obama 259 electoral votes.

On the other hand, McCain -- at this stage -- is not likely to win all the stages that Bush won in 2004 (284 electoral votes.) McCain is almost sure to lose Iowa (7 electoral votes.) Add to this mix, Ohio (20 electoral votes), Virginia (13 electoral votes), Colorado (9 electoral votes), and New Mexico and Nevada (each with 5 electoral votes) -- there is substantial doubt if McCain can hold these states. That puts McCain at about 225 electoral votes.

(2) The more compelling arithmetic is this. Repeatedly, in large numbers of public polls about 37-38 percent of the likely voters identify themselves as Democrats and about 30 percent as republicans. That leaves about 30 percent as independents.

Assuming both Obama and McCain get 80 percent of their party votes, the differential gain for Obama would be about 6.5 percent. In the cross-over vote of 20 percent, Obama would lose about 1.5 percent leaving a net lead of about 5 percent for Obama. Assuming that Obama and McCain split the independents, Obama's overall lead would be about 5 percent.

The only caveat is the potential Bradley-Wilder effect which accounts for about 5-7 percent.

(3) What adds to the odds of Obama's victory are the extra-ordinarily low approval ratings (in low 30s) of President Bush and the perception that the country is heading in the wrong direction (over 64-70 percent of Americans say this.)

Senator Hillary Clintion and Political Future

Senator Hillary Clinton is a very able candidate for the office of Presidency. Through a combination of tactical error and ill-fortune, Clinton is and will be (at the conclusion of the Democratic party primaries and caucuses next week) about 125-150 pledged delegates short of Senator Barack Obama.

Clinton's closing arguments -- she has won more delegates from the primaries (leave those caucuses alone), there is evidence to show that she may stronger than Obama against John McCain in the big states of Florida, Michigan, Ohio, and Pennsylvania in the general election (these are based on today's data and it is not reasonable to base the November forecast on today's data,) may be more number of popular vote, and the core constituencies of the Democratic party (e.g., catholics, women, and working class electorate) appear to be more supportive of her candidacy -- are sound and reasonable.

But we can also present several arguments -- all of which would be reasonable and plausible -- in favor of Obama's candidacy.

Therefore, at this point we can argue and debate because there are no definitive answers to any of these arguments.

At the beginning, the rules of the game were set and everyone agreed to it. The Democratic party presidential nomination will be decided by the delegates, and in this metric Senator Obama is ahead (in pledged delegates -- delegates won through elections.) Sure, the super-delegates can overturn and give the nomination to Senator Clinton. That's not unreasonable but it looks most unlikely because the super-delegates have been publicly expressing support for Senator Obama overwhelmingly.

That's where it is.

Then why not suspend the campaign? In fact, objectively Senator Clinton should have suspended the campaign after the Indiana and North Carolina primaries. Why?

Clinton would have, any way, won the West Virginia and Kentucky primaries, and she would equally certainly win the Puerto Rico primaries. Wouldn't it have made Senator Clinton stronger to win these primaries as a non-candidate than as a candidate? Further, if the super-delegates and even the pledged delegates were to confront some extra-ordinary situation or revelations that render Senator Obama as not a viable candidate for the party before the convention in August, the chance that the party will turn to Senator Clinton as its standard-bearer would have not diminished (it probably would have increased) an iota.

In any case, there is a case to be made -- a strong one at that -- for Senator Clinton to complete and contest in all the Democratic party primaries. That does show her determination and strength -- she has been a fighter.

But when the last primaries are over on June 3rd, Senator Clinton should suspend her campaign and let the chips fall where they may.

So what if the Democratic party's presidential nomination does not happen in 2008? There are many good options. If Senator Obama wins the general elections in November Clinton can still seek the Presidency in 2016 -- she would only be about 68 years of age. If Obama does not win the general elections in November, Clinton is most well poised for the 2012 presidential contest. In the meantime, Clinton can continue in the U.S. Senate and/or explore other interests such as governorship of the state of New York though that it not such an attractive office.

Senator Clinton is in a good spot -- that sounds odd in the midst of the current titanic struggle but that's the truth. She has a bright political future -- but she has to tread the needle a bit gingerly now.

The Karnataka state assembly elections results, and the fortunes of Congress party

The recent Karnataka state assembly produced discouraging results for the Congress party and the United Progressive Alliance (UPA.) The Congress party secured about 80 assembly seats -- an increase of about a dozen seats from the last elections. The Janata Dal (secular) secured only about 28 assembly seats -- a substantial decrease in the number of seats from the last elections. And then there is Bharatiya Janata Party (BJP) which has secured 110 assembly seats -- a very sharp increase of almost 33 seats from the last elections. The BJP is set to form the government in Karnataka.

All this does not bode well for the Congress party and the United Progressive Alliance (UPA) as India prepares general parliamentary elections.

And here is why --

(1) Out of the 21 states that have gone to elections went to polls since the UPA took over, UPA has won only in eight of those elections.

(2) In spite of very strenuous efforts by Sonia Gandhi and Rahul Gandhi in Uttar Pradesh, Gujarat and Karnataka state elections, the electoral performance of Congress party and its allies in UPA has been most unimpressive.

(3) While the economic growth has been reasonable, the recent sharp increase in prices -- particularly of the food -- has taken much bite out of the benefits of economic growth.

(4) The series of electoral losses for the Congress party and its allies in UPA comes even after sustained populist policies including the Rural Employment Guarantee Scheme by the government. For example, the UPA government also implemented Rupees 60,000-crore farm debt relief package for Karnataka and that did not seem to help.

Of course, this does not mean that Bharatiya Janata Party and its allies (National Democratic Alliance, NDA) are going to win the next parliamentary elections. On the contrary, the next elections are also likely to produce a coalition out come -- and who will form the government (UPA or NDA) will be decided at the small margins.

The travails of Pakistan

Pakistan is yest again in a bind. For a county that is full of thoughtful and vibrant citizens, its polity has let it down since its independence. Unfortunately, Pakistan -- though was gifted with the same norms and institutions as India for political pluaralism by the British -- has not found its political governance model.

Pakistan military -- unlike in India -- has been too willing to seek political power. Three military rulers -- Ayub Khan in the 1960s, Zia-ul-Huq in 1980s and now Musharraf -- each with substantial longevity have dominated Pakistan's political leadership. The challenge with military autocracy as with any dictatorship is that there is no accountability and the desire to hold on to power warps even the most sane human mind. In a democracy, elections are as inevitable as the seasons and the political leadership is naturally held accountable and prevented from amassing power.

Look at Musharraf. First, in trying to hold and then in trying to consolidate his political power, Musharraf decided to align himself with the U.S. in the fight against terrorism. Instantly, Musharraf gained a certain respectability and credibility, and access to resources because of the patronage from the U.S. However, Musharraf squandered this opportunity though hubris and a greed for power.

Musharraf amended the constitution to suit his whims and fancies, refused to let political parties and leaders operate in Pakistan, intimated the press, and finally threatened the judiciary and removed the inconvenient judges. Musharaff disguised all this for a long time as necessary actions to fight fundamentalism and terrorism. But this excuse soon wore out.

Musharraf, finally and reluctantly, allowed parliamentary elections and participation by political parties. And then tragedy stuck in the assassination of Benazir Bhutto. Bhutto's compromised and corrupt husband, Asif Ali Zardari, was then elected as co-chair of Pakistan People's Party.

In an effort to divide the political opposition, Musharraf adopted the old Machiavellian approach by dismissing all the criminal and civil complaints against Zardari prior to the recent parliamentary elections. But Musharaff prevented Nawaz Sharif, the former Prime Minister, from contesting the parliamentary elections. While Zardari's Pakistan People's party won enough parliamentary seats for a simple majority, Sharif's Pakistan Muslim League also won substantial number of seats.

After much hard-pressed negotiations, Zardari and Sharif agreed to form the government together. But within months, the coalition has come apart. What a tragedy for Pakistan! What a gift to Musharraf!!

The agreement has come apart on a simple but enlightening issue. Sharif, rightly, wanted the Supreme Court justices who were removed by Musharraf for his own political expediency be restored to their positions through parliamentary action. That was the right constitutional, moral and political decision. But Zardari, after initially agreeing to this, blocked the rightful action because Zardari himself could not afford an independent judiciary given his precarious situation.

Of course, Musharaff is smiling. But people of Pakistan have much to be disappointed.

Myanamar: There has to be immediate change in governace

The dire situations in cyclone-battered Myanmar and quake-tossed southwestern China have drawn out the world -- there has been a huge outpouring of sympathy (emotional giving) and financial support (monetary giving) to the victims of these disasters.

What makes human beings give -- emotionally and monetarily? Scientists tell us that we are hard-wired to help others, to drop everything in crisis situations. It has to be a crisis but it also has to a new and a sharp situation.

Note that even crises can lose their newness and sharpness after sometime, and perceptually and emotionally become a routine irritant. That is the case with Darfur. Is the situation in Darfur a crisis? Yes but we are tired of it and so the urge to give has died. That's why it is important to deal with the crisis immediately, otherwise everyone becomes worn out and distraction sets in.

The military junta in Burma has accepted the terrible conditions of its citizenry as a matter of fact and necessity to maintain control and power. That partly explains the junta's horrendous response to the tragedy and shockingly tawdry relief efforts. On the other hand, the Chinese political leadership (while not a paragon of tolerance or democracy) is aspirational -- it is intent on growing China and improving the lot of its citizens. So the Chinese political leadership has not become jaded as the military junta in Burma has.

It is time for the world -- including China and India -- to demand changes in the governance of Myanmar. The current junta has lost its conscience, and with the loss that conscience the ability to be shocked and roused.

The state of the US: America is rising or declining?

The size of the Unites States economy is about $13 trillion. Assuming the average annual growth of 2.5 percent (this has been the average since World War II), the U.S. puts. out about $320 billion annually. On the other hand, the sizes of the economies of China and India are estimated t o be about $2.5 trillion and $1 trillion respectively. Assuming a monumental and unsustainable 10 percent average annual growth, China puts out about $250 billion annually and India puts out about $100 billion annually. So every year, the U.S. still adds more to its economy more than China or India does.

In this face of these empirics, it is impossible to argue that either China or India is going to overtake the U.S. in economic superiority.

However, what might change the equation is one of two very discrete and dramatic events. First possibility is a collapse of the U.S. economy triggered by some event or a set of events. But that's unlikely. Even the current oil price increase from about $20 per barrel to about $130 per barrel has had only marginal impact on the larger economy. The U.S. economy has shown remarkable resilience -- the Savings and Loans Industry crisis in 1980s, the dot com bust in the early 2000s, and the housing crisis in the last year or so are troublesome but they have not and cannot break the U.S. economy.

The second possibility is a new innovation or a set of innovations that dramatically alters the way of life. Think of steam engine, or Bessemer process for mass production of steel, or world wide web (WWW) technology. But, here, too the U.S. appears to be, if any thing, poised ahead of other societies -- think of genetics and genome therapy, or genetically modified food, or clean technologies, or nano-technology, and more.

The general argument that the U.S. has borrowed so much from other societies that it has now become a servant of these societies is not compelling – simply put, where are these societies, individuals and organizations going to put their monies? If not the U.S., where else? Of course, there will be some nominal and periodic variations and ups and downs but it is unlikely that there can ever be a run on the U.S. economy because there is no there large-scale alternative.

May be I am missing a new breakthrough -- a new steam engine -- but short of that the U.S. is likely to dominate the world of economy, commerce, and innovations for the next 50 years.

Clinton or Obama in Kentucky and Oregon Democratic primaries?

It is time for Kentucky and Oregon Democratic party presidential primaries tonight. Who will win those primaries -- Clinton or Obama?

Of course, there are public polls that show Clinton trouncing Obama in Kentucky, and Obama winning the Oregon primary.

But we do not require any public preference measurements, we can make the forecast based on the demographics. Elsewhere in this blog, I have asserted (with credible empirics from the current election cycle) that Obama dominates those primaries and caucuses in states where the percentage of African-American voters is very small (less than 5 percent as in Iowa or Wisconsin) or relatively large (more than 20-25 percent as in Georgia and South Carolina.) Where the African-American voters are present in the middling range -- 5 percent to about 15-20 percent -- Clinton prevails more often than not.

Demographics has been a reliable indicator thus far, and this assertion has been supported credibly. In the contests thus far, Obama has won 12 of the 15 contests in which the African-American population has been less than 5 percent, and 10 of the 11 contests in which the African-American population has been greater than 15 percent. In those 18 states where the African-American population ranges from 4%-16%, Obama has won 8, while Clinton has won 11.

What are the distributions of African-American populations in Kentucky and Oregon? 7.3 percent and 1.6 percent respectively. So Clinton will prevail in Kentucky and Obama in Oregon. We will know tonight.

Note that the hypothesis and model are postulated only for the Democratic party presidential contests between Obama and Clinton, and not for the general elections.

Confident China and Paranoid Myanmar

Natural tragedies have struck both Myanmar and China in the recent past. However, there could not be more stark contrast in the response to the disasters from Myanmar and China. Myanmar has been diffident and paranoid but China has been confident and open.

Myanmar was struck with a devastating cyclone --Nargis -- which has killed tens of thousands of men, women and children. Death in Myanmar has come not only from the cyclone but from lack of sustained relief efforts -- so there have been deaths due to starvation and disease. The current death toll is at nearly 78,000, though expected to surpass 100,000. Upto 2.5 million people are considered severely affected.

In China, more than 34,000 are reported dead and 4.8 million have been left homeless from the recent earthquake and its aftershocks.

The two different responses from the Myanmar military junta on Myanmar and the China's political leadership reflect on the strength of the two societies. In Myanmar, the military junta refused to give information about the scope of the disaster and the necessary relief efforts. The junta has refused to let reporters visit the disaster area. No external aid was sought, and even when offered was turned down -- aid from the U.S. and even the U.N. was turned down. Even threats from the outside did little to nudge the military junta. And finally, when the relief supplies were distributed the junta converted the exercise into a propaganda effort by placing the names of the generals prominently on the relief goods.

There was no thoughtful remembrance of the dead -- only when China announced a national mourning did Myanmar follow suit.

Myanmar's crass, class-less and paranoid response is born out of the anxiety and weakness of its military rulers. It is a tragedy that the world has not pushed the military rulers hard. The U.S. and other societies do not want to use their political and diplomatic capital on Myanmar because Myanmar is not in their strategic interest.

On the other hand, China was most open and responsive. Within 14 minutes of the tragedy, Chinese officials rushed relief efforts to the disaster area. The authorities also made all the information and data available to the citizens, reporters, aid-workers, and others. China warned the disaster-area citizens of possible aftershocks and their possible fall-outs. While China is a resource-strong society, it did not turn down aid.

China paused the Olympic torch relay, and paid national homage to the dead. China's President, Hu Jintao, and Prime Minister, Wen Jiabo, have made public visits to the disaster-stricken area.

China's thoughtful and dignified response speaks volumes of its strength and confidence. China now should rightfully edge the paranoid Myanmar regime into more political accountability -- but for China's patronization of Myanmar, it would be difficult for the military junta in Myanmar to defy the basic human decency and plod on.

Time for a woman president for the U.S.? Hillary Clinton or ...?

As Hillary Clinton's contest for the Democratic party presidential nomination is becoming less likely, there is a natural and somewhat anguished question: when will a woman be the presidential nominee of one the U.S. parties let alone be the winner of the office?

I think that Hillary Clinton was and remains the most plausible candidate for securing the U.S. presidential nomination and even winning the office of presidency.

Unfortunately, Clinton has let the opportunity silp away from her in 2008 but her best efforts may not have been enough. Barack Obama has not only run a better tactical campaign (for example, Obama wisely contested all the caucus state contests while Clinton did not) but Obama is also the "person" that has met the mood of the country and time in 2008 -- just as Reagan did in 1980, and Bill Clinton did in 1992. When that happens i.e., "the candidate" is in perfect sync with the mood of the country, it is almost-impossible for any other candidate to overcome that.

However, Hillary Clinton is eminently qualified to be the President of the United States. There will be another time -- may be in 2012 or in 2016.

The New York Times has listed some potential women presidential candidates. The names are presented in the enclosed photo-graphics. Clearly, Hillary Clinton is the most credentialed person (who also happens to be a woman) for the U.S. presidency.

The tragedy in Myanmar, and the role of India

The situation in Myanmar is incredibly tragic. The devastation caused by the cyclone is monumental but the paranoia of the military junta is breathtaking. The world has let a paranoid military junta run the country without any compunctions or any fear of reprisal from outside world. We are not talking of a moralist society, we are just talking of some very basic human values.

Why has the military junta gotten away with such crassness? Simply because most nations just don't know or care about what happens in Myanmar -- not dissimilar to the situation in Darfur. And a few nations that may care are keeping their distance for their own interest -- there is nothing wrong this, it is just pragmatic. So a combination of indifference (because Myanmar does not provide any material or strategic or military benefits) and pragmatism has left the military junta in Myanmar wreck havoc to the society.

For United States, Russia or European countries, Myanmar offers precious little -- no great mineral sources or strategic value. One country that ought to have a serious interest -- based on history, geography and strategic value -- is India. However, since China considers Myanmar to be under its protection and tutelage India has quietly avoided confronting the regime. There is little to be gained for India.

devastation caused by the cyclone is monumental but the paranoia of the military junta is breathtaking. The world has let a paranoid military junta run the country without any compunctions or any fear of reprisal from outside world. We are not talking of a moralist society, we are just talking of some very basic human values.

Why has the military junta gotten away with such crassness? Simply because most nations just don't know or care about what happens in Myanmar -- not dissimilar to the situation in Darfur. And a few nations that may care are keeping their distance for their own interest -- there is nothing wrong this, it is just pragmatic. So a combination of indifference (because Myanmar does not provide any material or strategic or military benefits) and pragmatism has left the military junta in Myanmar wreck havoc to the society.

For United States, Russia or European countries, Myanmar offers precious little -- no great mineral sources or strategic value. One country that ought to have a serious interest -- based on history, geography and strategic value -- is India. However, since China considers Myanmar to be under its protection and tutelage India has quietly avoided confronting the regime. There is little political gain for India in a confrontation with China, and that is understandable.

In a farcical display of populism, the military junta has placed the new constitution -- with not anything new to gloat about -- for a referendum. The junta is asking the voters to approve of the new constitution in a vote just a week after tens of thousands have been wiped out by the act of nature (cyclone) and the callousness of the military junta.

What a tragedy! The tragedies such those in Darfur and Myanmar are a blot on all of us. Myanmar does not have to become a pluralistic tolerant society -- just simply shed its such shameful paranoia. Can the world -- including China -- not make this happen? India should make a more concerted (behind-the-scenes) efforts to help assuage the tragic situation. If not India, who else? If not now, when else? It is time for India to expend some of its political goodwill with China, and help coordinate the relief efforts.

Indiana and North Carolina Democratic Party Presidential Nomination Primaries on May 6th

As the voters head to the polls tomorrow in the Democratic party presidential primary contests in Indiana and North Carolina and express their preferences, it is my belief that Clinton will win the Indiana primary by about 6-8 points, and Obama will win the North Carolina primary by about 10-12 points. Here is why.

In Indiana, the African-Americans are likley to be about 10% of the electorate and the whites about 90% of the electorate. Among the African-Americans, Obama is likely to secure about 85% of the votes and Clinton about 10%. That gives Obama a net gain of about 8 points from the African-American votes. Among the whites, Clinton is likely to secure about 60% of the votes and Obama about 40% of the votes. That would give Clinton a net gain of about 20 points from the white votes. So Clinton has a net overall gain of about 12 points. However, making some adjustments for age and region in Indiana it is more likely that Clinton's net advantage is likely to be about 8 points.

Let us look at it from another perspective. In all the recently released (i.e., released in the last 2-3 days) public polls, Obama's preference numbers have been in the small range of low-to-mid 40s. However, Clinton's preference numbers have varied from as low as 42 to as high as 54 -- much higher variability. In a closer examintion of the preference numbers, it appears that when the undecideds are nudged and cajoed they prefer Clinton overwhelmingly. In any case, this has been the pattern in the earlier primaries.

Take Zogby's tracking poll released today. The stated preference numbers in Indiana are 42 for Clinton and 44 for Obama. If the undecides break 70-30 in favor of Clinton (not a very unreasonable assumption given the recent history), the undecideds would give Clinton a net gain of about 6 points placing her preference number about 52-53 and Obama's number at about 47-48.

In North Carolina, the African-American vote is likely to be about 35 percent of the electorate on Tuesday. Assuming about 70 perent net advantage in the African-American vote, the overall net gain for Obama from the African-American vote is about 24 points (70 percent of 35 percent.) Assuming about 20 percent net advantage for Clinton in the white votes, the overall net gain for Clinton from the white votes is about 13 points (20 percent of 65 percent.) So the total net gain for Obama is about 11 points (24 minus 13.) Most public polls put Obama's lead in North Carolina in the high-single digits or low double-digits.

We will obviously find out tomorrow night.

Update on Tuesday, May 6th: Based on the reports of large numbers of registered republicans voting in the Democratic primary (the republicans may be mischievous or genuinely engaged -- nobody knows for certain) in Indiana, the overall turnout numbers, and Zogby's final Indiana primary tracking poll including Zogby's report that Obama did well on Monday (47-41 in favor of Obama over Clinton), it is likely that Obama could come within striking distance (within five points) of Clinton's votes and/or may even squeak past her in today's Indiana primary.

Gasoline Tax Holiday and John McCain

John McCain and Hillary Clinton are proposing revocation of gasoline tax for three months -- June, July and August -- for the American consumers. The gasoline tax is about 18 cents per gallon. There are varying estimates of the potential average savings for the consumers -- most estimates (optimistic estimates) appear to put the maximum savings for a family for the entire summer to be about $100.

However, there are several caveats to be stated. First, there may be actually no savings to the families for two reasons -- there may actually be net loss. One reason is that oil companies generally tend to use the repeal of gasoline tax as an excuse to increase the price by an amount that would more than offset gasoline tax. The second reason is that with the repeal of the gasoline tax demand for the gasoline is likely to rise and this demand is not likely to be met by new production essentially leading to a price increase. Second, the repeal of gasoline tax will result in a loss of about $9 billion to the federal highway fund which would result in shortchanging infrastructure development and loss of many jobs -- may be as many as 6,000 in Indiana. Third, this experiment -- revocation of gasoline tax for a short spell -- has been tried (including in Indiana) and the experiment has not only failed to meet the desired goals but also proved counter-productive.

However, all this make political sense for Hillary Clinton -- she is in the fight of her life for the Democratic party presidential nomination, and she wants to get as many votes as possible and differentiate herself from Obama even if it means a bit of theatrical populism.

But the question is this: why is John McCain engaged in this populism? It does not add up. Of course, McCain wants to position himself as a man in touch. However, all this is more likely to muddy up McCain's biggest strength -- an independent, non-populist, somewhat maverick political leader.

Who has a more viable path to nomination? Clinton or Obama?

Both Senators Clinton and Obama are genuinely hopeful of securing the nomination of the Democratic Party as its candidate for the presidential contest in the fall.

In a purely rational world, Obama's hope appears more reasonable -- he is leading by insurmountable margin in the delegate count, the only measure that matters to secure the party's nomination.

However, human beings do not evaluate their options (sometimes called prospects) in that simple rational frame work. Two behavior psychologists (Kahneman and Tverskey, 1979) discussed this at length and proposed a new theory to explain choices made by human beings -- the psychologists argued and showed that human beings evaluate their choices based on their own experiences and (subjective) reference frame, and not on some objective and external frame. Kalyanaram and Little (1994) demonstrated the application of this theory to marketing, particularly, to how consumers perceive pricing.

The prospect theory explains the doggedness of the Democratic party presidential nominating contest.

Inertia, Discontinutiy and Voter Preferences

Social scientists talk about "persistence," "inertia," and "long run equilibrium" in their analyses and descriptions of individual, group social and market phenomena. For example, we find that brands generally revert to their mean i.e. average (sometimes, also called equilibrium) market share levels even after the firms inject some perturbations (such as aggressive advertising and promotion of the brand.) Surely, there are variations -- ups and downs -- created by the perturbations but eventually the level appears to revert to the average measure. Only a very discrete and definitive discontinuity changes this level.

Look at the current Democratic party presidential contest between Senators Clinton and Obama. In a national preference match-up, Senators Clinton and Obama were supported by about (average) 45 percent and 25 percent of the voters respectively in a national preference match-up. These numbers persisted in spite of many events including surprisingly strong fund raising reports by Obama and tentative debate performances by Clinton in October and November. None of those events provided enough discontinuity for voters to change their preference structure.

And then came Senator Obama's convincing victories in Iowa and South Carolina, and close placings in New Hampshire and Nevada in the month of January. Since these results were unexpected events (of course, not to the political class) to the Democratic party voters, the preference structure changed.

Since then Senators Clinton and Obama have both earning about 45 percent of support from the Democratic party supporters in the part contest for nomination, and both have been running about even with Senator John McCain (the presumptive Republican nominee) in the general elections match-up. Obama has been doing slightly better on average but not by much. None of the events -- Bosnia error by Clinton and Wright controversy for Obama -- has yet changed the preference structure.

Look at the perceptions of the three candidates - Clinton, McCain and Obama. As Gallup organization reports that over the course of the presidential campaign (when millions of dollars have been spent) basic perceptions have not changed much. Americans viewed McCain older and likable in January and the same perception dominates now in April. Clinton was perceived as experienced and not trustworthy then and that perception has not changed either. Obama is much better known today than before the campaign got underway, but the dominant perceptions of him (as being young and inexperienced and a fresh face with new ideas) have changed little.

It does not appear that there are likely to be any foreseen event that would shift the voter preferences substantially.

That's why this is such a dogged race in the Democratic party presidential nomination contest.

Clinton-Obama Democratic Party Presidential Contest: Are we seeing Bradley/Wilder Effect?

I have written about the Bradley effect. Sometimes, it is also called Bradley-Wilder effect. I wrote about this in 2003, and that piece is available on this blog.

Simply put, Bradley-Wilder effect asserts that some white voters when they reveal their political preferences state the black candidate as their preference (lest they be misconstrued to be closed-minded) in a white-black candidates race though the real preference of the said voters may be the white candidate.

So we have the situation of the publicly expressed polls overstating the support for a black candidate in a black-white candidates political race. The two political choices that are cited as examples of this effect are the 1981 California gubernatorial race between Dukemajian (white candidate) and Bradley (black candidate), and the 1989 Virgina gubernatorial race between Wilder (black candidate) and Coleman (white candidate.)

The question now is: is the Bradley-Wilder effect is still alive? And is it showing up in Obama-Clinton Democratic party presidential contest?

The most compelling data to assert that Bradley-Wilder effect may be operational comes from the Pennsylvania Democratic primary. About one in five Pennsylvania voters said the race of the candidates was among the top factors in deciding how to vote, according to exit polls, and white voters who cited race supported Clinton over Obama by a 3-to-1 margin.

The polls, conducted by Edison/Mitofsky for the five television networks and The Associated Press, asked voters if the race of the candidate was important: 19 percent said yes, while 80 percent said no. Of those who said yes, 59 percent voted for Mrs. Clinton and 41 percent voted for Senator Barack Obama. Of those who said no, 53 percent voted for Mrs. Clinton and 47 percent voted for Mr. Obama. Broken down by race, 13 percent of whites said race was important to them, and 75 percent of those voters sided with Mrs. Clinton. Of the 66 percent of whites who said race was not important to them, 58 percent voted for her.

Further, a recent Associated Press-Yahoo News poll found that about 8 percent of whites would be uncomfortable voting for a black president. (The actual percentage is probably higher because voters are shy about admitting a racial prejudice to pollsters.)

So are we watching Bradley-Wilder effect? May be but there are some serious confounding elements. Here is one. Unlike pre-election polls, the exit polls do not involve a "face to face" interview. Rather, the exit poll interviewer's task is to randomly select and recruit respondents, hand them a paper questionnaire, a pencil and a clipboard and allow the respondents to privately fill out the questionnaire and deposit it into a large "ballot box." (Note that the "Bradley/Wilder effect" pertained less to exit polls but to pre-election telephone surveys. The underlying theory was that white respondents were sometimes unwilling to reveal their preference for the white candidate in a bi-racial contest when they felt some "social discomfort" in doing so. That is, respondents would be less likely to reveal their true preference in a telephone interview if they believed the interviewer supported a different candidate.)

The Divide in the support of Clinton and Obama

There certainly has been very discernible divide in the electoral support of Senators Clinton and Obama in the Democratic party presidential nominating contests -- primaries and caucuses. The divide has been along many lines -- gender, race, age, level of education, level of income, and rural versus urban locale -- and some of these divides have been persistent and clear. The enclosed Decision Tree (Source: The New York Times) makes it all evident (you can click on the Decision Tree to enlarge it.)

Democratic Party Presidential Nomination Contest: A Review of the Delegate and Popular Vote Counts

After the Pennsylvania vote, it is time to update the estimated number of delegates (total of pledged delegates i.e., delegates won through elections -- primaries and caucuses, and super-delegates i.e. party officials and activists) and popular vote acquired by Senators Clinton and Obama in the Democratic party presidential nominating contest.

These -- delegates and populate votes -- counts do not include the outcomes of the primaries held in Michigan and Florida. Both Michigan and Florida violated the explicit rules set by the Democratic Party National Committee (DNC) that no state -- other than Iowa, New Hampshire, Nevada and South Carolina -- was to hold its party presidential nomination primary or caucus before so-called Tuesday when any state could have set its elections. (Super Tuesday was semi-national primary election day. The four states -- Iowa, New Hampshire, Nevada (large Hispanic population) and South Carolina (large African-American population) -- together are considered representative of the American electorate and small enough for campaign without the need for extra-ordinary amount of resources.)

As a result of their defiance of the DNC's ruling, DNC mandated that any election would be considered null and void and asked all the presidential candidates (which included Clinton and Obama but it also included Senators Biden and Dodd, and John Edwards) not to campaign in those two states. All the candidates -- including Clinton and Obama -- consented to this. There was absolutely no campaigning. Obama and Edwards even removed their names from the ballot in Michigan (for some reason, Clinton did not.) However, Obama and Edwards (and Clinton) could not remove their names from the Florida ballot -- Florida party would not allow that.

Senator Clinton now argues that the Michigan and Florida votes should be counted but Obama says no -- so far, the Democratic Party is holding on to its rules and punishment of Michigan and Florida.

If Michigan and Florida were excluded, the the number of delegates required to win the Democratic Party's nomination is 2024. (If Michigan and Florida were included, then the majority number would be approximately 2208.)

The following estimates of delegates vary some because the estimates from the caucus results and the the commitments of super-delegates are just estimates with opportunity for slightly different interpretations and counts.

Delegate Counts without Florida and Michigan
NBC: Obama 1,727, Clinton 1,594
ABC: Obama 1,721, Clinton 1,586
CNN:Obama 1,719, Clinton 1,586
CBS:Obama 1,715, Clinton 1,585
AP: Obama 1,714, Clinton 1,589
So Obama leads by about 130 delegates.

Delegate counts with Florida and Michigan (approximation)
Obama 1960-65, Clinton 1925-1930
If Florida and Michigan primaries were honored as they were conducted with no adjustments, Obama would only lead by about 30-35 delegates (Clinton would lead by about 95-100 delegates when the approximately 380 Michigan and Florida delegates are counted, i.e. the approximate delegate counts would be about 1960 for Obama and about 1925-30 for Clinton.)

And now to the estimates of popular votes under various scenarios.
Popular Vote Total without MI and FL and without caucus popular votes
Obama 14,417,134(49.2%), Clinton 13,916,781(47.5%), Obama +500,353(+1.7%)
Estimate without MI and FL but with w/IA, NV, ME, WA caucus popular vote
Obama 14,751,218(49.3%), Clinton 14,140,643(47.2%), Obama +610,575(+2.1%)
Popular Vote (w/FL) but no caucus popular votes
Obama 14,993,348(48.3%), Clinton 14,787,767(47.6%), Obama +205,581(+0.7%)
Estimate with FL and w/IA, NV, ME, WA caucus popular votes

And now we provide numbers from Michigan primary too. But this is seriously problematic because Clinton is given about 328,000 votes (because her name was on the ballot) and Obama is given zero (because the rest of votes went to "uncommitted" as Obama's name was not even on the ballot.)
Obama 15,327,432(48.4%), Clinton 15,011,629(47.4%), Obama +315,803(+1.0%)
Popular Vote (w/FL & MI) but no caucus popular votes
Obama 14,993,348(47.4%), Clinton 15,116,076(47.8%), Clinton +122,728(+0.4%)
Estimate with FL and MI, and w/IA, NV, ME, WA , and caucus popular votes
Obama 15,327,432(47.5%), Clinton 15,339,938(47.5%), Clinton +12,506 (+0.04%)

In summary, even with the disputed Florida popular votes included Obama leads Clinton. However, only when Michigan is included (where Obama is given zero votes) Clinton leads Obama narrowly.

An update on Pennsylvania Democratic Party Primary

Here is my update on Pennsylvania Democratic primary.

The latest and final round of reliable public polls seem to affirm that Senator Clinton is leading by about 6-7 points. Rasmussen and Survey USA polls both of which use automated calls, show 5-6 points lead for Senator Clinton. Mason-Dixon and Zogby (tracking) polls, both which use live interviews, also show5-6 points for Senator Clinton. There are other polls (American Research Group, Quinnipiac, Strategic Vision and SuffolkUniversity) that show a range 7-13 points lead for Senator Clinton, and one of them -- just one of them i.e. Public Policy Polling (PPP) -- shows Senator Obama leading by about 3 points, 49-46 (PPP has been quite reliable, and it was both in direction and magnitude correct in its final polled forecasts in Ohio and Texas.)

There are reports that suggest that Senator Clinton's (own) internal polling suggests a 11-points lead for her. Further, Senator Clinton has just released a last-minute political advertisement that is dark and wonders on the imponderables, -- it even has an image of Osama bin Laden -- and asks the question, "Who do you think what it takes?" This is a sterner version of Clinton's (really, Mondale's 1984) celebrated 3 am advertisement that saturated the Ohio and Texas markets and that was considered responsible for Obama's unexpected loss in Texas and a larger magnitude of loss in Ohio.

So a substantial (7-9 points) Clinton victory appears likely. However, there are tow huge caveats. First is a comparative (empirical) observation about the publicly measured preference of votes and the movement of this preference in Ohio and Pennsylvania. Examining just the averages of the polls in the days leading up to the primaries, Senator Clinton led in Ohio by about 5 percent (47.8 to 42.4) with three days to go. And this average lead of about 5 points persisted at least for about 4 days before we started seeing an uptick for Senator Clinton. With three days to go, Clinton's average support grew from 47.8 to 50.1 -- a statistically significant 2.3 percent increase. In the same time-period, Obama's support remained flat -- the final number being 43.0 which was statistically insignificant. So there was a clear, statistical uptick in support for Clinton in the last three days and the upward trend carried over to the election day with the final tally providing Clinton with a 10-points victory margin.

However, in Pennsylvania the numbers just don't show that trend. For the last 4-5 days, the average lead for Senator Clinton has been about 5 points (average support of about 47.5 to 42.2.) However, today -- with one day to go -- Senator Clinton's support has edged from 47.5 to 49.0 -- a significant gain of 1.5 percent. However, Obama's support too has edged upward today from 42.2 to 43.6 -- about 1.4 percent increase, the same magnitude of increase as observed for Clinton. So the differential appears to be stable, and we don't quite yet see the electorate breaking in favor of Clinton.

Second, the registration of substantial number of new voters and their distribution in the various regions of Pennsylvania tilts the field in favor of Obama. This is best analyzed by Jeanne Cummings of Politico as abstracted below.

"It's clear that a disproportionate share of the 300,000 new Democratic voters this year are young, and they're underrepresented in opinion surveys because pollsters don't have their cell-phone numbers. People under 34 represent 25 percent of the state's Democratic electorate, but they're only 7 percent of the likely voters in the Daily News/Franklin & Marshall poll that showed Clinton up by 6 percentage points.

According to the Secretary of State’s office, since January about 217,000 new voters have registered for the April 22 primary, the vast majority of whom signed up as Democrats. In Philadelphia, by far the state’s largest city, more than 12,000 new Democrats were added to the rolls in the final week before the March registration deadline, compared to just 509 Republicans.

That statewide Democratic surge has been accompanied by a flood of party-switching. More than 178,000 voters have changed their party status since January — and the Democrats have captured 92 percent of those voters. In Delaware County, a Philadelphia suburb once home to a storied Republican machine, nearly 14,000 voters have switched their party affiliation to Democratic since January compared to just 768 who became Republicans.

A poll of those switchers and new registrants released by Madonna last week found that Obama was the preferred candidate for 62 percent of them. Clinton insiders said they are also bracing for the same 60-40 split among newly registered Democrats. Depending on turnout, Madonna (of Franklin and Marshall) said, those newcomers could help Obama cut a Clinton victory margin by 2 to 3 percentage points and keep her below a double-digit win that would breath new life into the hard-fought race.

For instance, about 143,400 Democratic newcomers – including newly registered and party switchers — are in Philadelphia and its suburbs. Those numbers could help Obama rack up big margins in what is considered his strongest turf. About 28,400 of them are in or around Pittsburgh, an urban area Clinton needs to counter Obama’s Philly support. Another 30,000 of them hail from the generally smaller, conservative counties in the state’s northwest and southwest, a region that Clinton is hoping to draw Reagan Democrats back to the party and to her cause.

Finally, the Clinton-friendly sections of central Pennsylvania are now home to more than 70,000 of the Democrats’ new recruits, including more than 6,000 in Centre County which is home to Penn State University. An area where Obama and Clinton are likely to battle for voters is the state’s northeast corridor. Those ten counties, ranging from Carbon to Wyoming, have recorded more than 40,000 newly registered Democrats and party switchers. In Lehigh County, for instance, Clinton is expected to have an edge in working-class Allentown. But Obama could tap a vein of votes from the host of small universities and liberal arts colleges based in the county. "

Update on Tuesday, April 22 morning (9 am). Based on a flurry of additional polls (new Insider Advantage and Zogby polls among others), I can now report that there is now a more discernible uptick in the average measure of the preferences for Senator Clinton than for Senator Obama since yesterday. Clinton's average preference has grown from 47.6 to 49.3, and Obama's from 42.3 to 43.3 -- a statistically significant difference of 0.7 percent in the upward tick. Further, the trend estimator from the polls of last two days now shows a lead of about 6.6 points for Senator Clinton as against a lead of about 5.3 points on Sunday. The possibilities from the new registrations and the voter turnout still remain.