Good Bye 2016

In all likelihood, this post is going to be my last in 2016. With only a day and a few hours left for 1st Jan, 2017 is pretty close. However, I am more worried about the 2nd of Jan which is the first working day of the new year, and which comes with loads of new work, especially in companies like mine which is an IT outsourcing provider and primarily caters to American and European clients who chill too much in this chilling period. Can't help the seasonality of this business. In any case, ever since I've started working, I've learnt that it's best to look at the present and live life one day at a time, as looking too far into an extrapolation of the present is often very stressful in professional context. And even in the most stressful of the days, living the present helps you get a relaxed sleep at night by letting you defocus from work and relax until the next day arrives, which if you fail to do would screw both your today and tomorrow.

I missed the target of completing 250 posts this year; this one's 242nd. Never mind, hope I stay alive to get there... and it's just a number anyway, significant only because we humans have agreed to use the decimal system of numbering. I don't remember having made any serious resolutions at the beginning of 2016. Or if I did, I wasn't serious enough about them so I could remember. But I am told it is very good to have goals in life - goals that totally drive one's thoughts, ideas and actions. Most people are only constantly searching for such goals all their lives. Perhaps it can be said that finding a goal for their life is the goal of most people. The rest are sure of what they want - a property which can also be a psychological aberration, given that it's only manifested in a few people. But such people change the world in bigger ways than normal people do. They are precious.

Even if one is unsure about goals of life, one can set smaller goals and strive to achieve them. It does require a resolve from a person to pursue goals just for the heck of it, or perhaps in search of some meaning of the time spent living. And little random things can often get together and lead to something big. Big enough to make everything look wise in hindsight.

Lemme set some goals for myself and see where I reach. Wish me luck.

No-Tax Economy

A very fundamental question has been lingering in my mind for quite some time now, especially after this demonetization move by the government and RBI - why should there be tax?

I am trying to put forth my point through this post, but please be aware that being technically accurate or complete in coverage and definitions is not the intent here, as I'm sure the relevance of my point is not lost because of that. Please bring forth if this post comes with any obvious or severe misunderstanding of our systems that would make my point meaningless.

The prime rationale for government pushing for a cashless economy is to ensure nobody escapes from paying taxes. All the so called black money became black coz the money went through a transaction that was entitled to certain tax which someone didn't pay, coz the transaction didn't have a record. This may be too simplistic a definition of black money, but let's say it covers some of it.

Technically, Tax is meant for all the government spending, including salaries of all government officials, spend on infrastructure development, all the welfare schemes and incentives, and maintenance of everything the government is responsible for. I am sure there are lots of other areas the money is spent, so let's just be aware of that and move on, without trying to define tax 100%. It is important to add, however, that one of the key goals of tax is income/wealth redistribution - which broadly means making rich less rich and poor less poor.

Now the fun begins. You have tax. And then you have ways to save tax. And the ways are supposed to help government acquire funds indirectly either through reserves of locked-in funds at individual levels or increased business growth at corporate levels and so on, which will lead to win-win for both parties - the government and the tax payer - in the long term. I don't exactly know the rationale behind offering such options to tax-payers, but I guess it must be to create an illusion of saving partially on what one is giving away and thereby to offer the prospects of additional well-being owing to one's extra application of wisdom in managing one's finances.

Now, the issue here is that people are smart. And those who see loopholes take advantage of them if they can manage to amass a little courage, and if the consequences are not that grave vis-a-vis the rewards. Why pay anything at all when you can not pay anything at all? - this question inevitably comes to everyone's mind when there is a way to escape paying taxes. A government would never like such people, and more importantly such practices. Given that people are what they are, one can only curb the practice - by plugging all the loopholes. Cashlessness is one such measure. But it doesn't guarantee that other creative practices won't emerge, coz still - people are what they are. In any case, especially in the Indian context at the moment, going cashless should be driven by convenience and not by lack of options. It's debatable whether convenience can bring a faster transition or brute force. My observation says the latter may be quick but short lived and temporary.

Doing away with the concept of Tax

Why have taxes at all? Suppose the total income of the economy for a year is x. And the government needs t amount to manage its expenses for the year. In the current model, we take away t from x so that x-t is what remains with all the working and tax-paying entities of the economy. Now imagine a model where the t is allocated by the central bank to the government. With the inflationary, money supply and demand-supply adjustments, the income of the economy will have to adjust to x-t. Or may be it won't, let's say it becomes y. The government spends like it does currently, may be budgeting for slightly more than t. This gap, called the fiscal deficit now, will have to be borrowed from the bank, and returned over time through the profits the government makes from the public sector undertakings, auctions of public property and natural resources, etc. The income redistribution part can be taken care of through direct cash disbursal, which comes from the t amount to be spent. I am sure there would be lot of econometrics involved in calibrating these parameters, including the money supply, to make it work efficiently. And I believe it is workable. It will definitely curb tax-evasion, as there is nothing to be evaded. In a way the government has already reserved its part and would be working with it for whatever it has to do. There still is scope for corruption at various levels, but that has to be modeled and dealt with as required. The needless hassle of creating and the resulting behavior of understanding complicated and funny income structures, benefits and investments would end and people will take what they make. And nobody would have any reason not to declare what they have. The entire money will circulate freely. Getting cashless will be convenient and will be embraced without a sales pitch.

The key challenge would be to transition to a new model like this. The world is so used to working with the tax model over centuries that anything else often seems inconceivable. However, I think there is scope for other models, much more simple and logical. The one I proposed has to be thoroughly modeled with all economic and financial considerations, and piloted very well so as to fine tune. And should definitely be rejected if it is not workable.

Does it have a chance? Please do let me know your views on this.

15-min post: working from home

It is 11.45 PM and I have to post this before 00.00 AM. This would perhaps qualify as my fastest post till date, made in exactly 15 minutes. I am still thinking what the next 14 minutes have to be about. For one, I don't want this post to be crap. I want to still do justice to this post with some genuine content, although it's only 13 mins left now. 12 now - 1 minute lost in typing random stuff and erasing it with backspace.

Working from home is becoming increasingly common in India too these days, particularly in the IT industry. My new job offers complete freedom to do so. For my easily distracted mind, a closed room at home is an ideal setting to concentrate, except for the sleep it induces at the same time, and with an option to crash, it requires tremendous will power to keep going on the table-chair. It's therefore easier to work from home when the work-load is very high and times are very stressful, as then the mind is totally occupied and in such a shitty state that sleep is the last thing crossing it.

8 more mins. In any case, for jobs that can afford, working from home is a really good option, if one can train himself to it. Besides obvious advantages like not having to drive to office and back in extreme traffic nowadays and not occupying office space while most of  the work is done buried in laptops and phones, it also gives an opportunity to an employee to plan his work better in the comfort of the surroundings of his choice, which he can even design the way that suits him (or her... masculine used just for simplicity), and all this can have a less stressful impact on the mind and also generates possibility of more productive employees, thereby offering better outcome for the company.

There are disadvantages of course of people free-riding and not really engaging well. So the companies have to rethink employee engagement and ways of working that suit work-from-home better, as that's the need of the hour.

It's 00.00 AM. I've to post this thing now.

Bass yoon hi...

Although I am tempted to write about demonetization, I will refrain from doing that. One - there is plenty of content and analyses already done on it, most of it claiming things without much of bases. And two - I am not much of a fan of this move, and don't feel the stated motives would be achieved by the move. I can't help being an agnostic in all aspects of life. So, I'll wait until the results start showing up. So far, it's not clear. And I don't want to express reservations as offending the easily offended supporters of Mr. Modi is not worth it at this point.

I am sitting right now in a lake-side restaurant in Kadagwaasla. I got a table right beside the lake, and I am sure it would be a great view in the day time. Right now, I can see the lights far away, and their reflection in the waters. On the other side of the resort, of which this restaurant is a part, my wife's office party is going on. I can hear loud music and cheers. Seems like quite an engaged workforce.

Of all the companies I've worked for, and I've worked for quite a number, the best parties were in Geometric, where I worked from 2004 to 2007, which I guess were the better times for the company. There used to be an annual bash, which was a terrific event with great food and unlimited booze, along with a pick and drop in company buses. The only better parties I had were the insti-parties at IIML, which were more fun and uninhibited, although with plastic disposable cups for booze and onion pakodas for snack, and for food you had to head to the mess. The music was loud and lights were dim, and after a few drinks, I danced like Hritik. And every party ended up with some misadventure by someone - makeouts, fights, etc. etc., and there'd be enough to gossip about until the next party.

It's getting pretty cold here, as I am sitting in the open. One more hour to go, I guess. I've had a cup of tea and cup of soup so far. Tea is drunk and soup is eaten - in linguistic terms. I ordered another soup now. Chalo then. See you later.