Of demonetization. And magic. And Modi


Image courtesy BuzzFeed

(NB: This is the uncut version of an article originally published on BuzzFeed on November 7)

At 8 PM on the 8th of November 2016, the curtain rose on the greatest magic act of all time.

That evening, one man stepped onstage in front of the largest captive audience ever assembled for a performance and, in a speech spanning 2423 words that took 25:04 minutes to deliver, converted most of the currency of one of the largest economies in the world into so much worthless paper.

It was intended, he said, to usher in a Swachch economic Bharat. It was audacious in concept and ambitious in scale, even as it flew in the face of received wisdom that you cannot fool all the people all the time.

The ace mentalist Nakul Shenoy told me that a magician can, and often does, stumble during a performance. Modi’s stumble came four days into his essay in mass hypnotism when, in a November 12 speech to the NRI community in Kobe, Japan, he laughed at the hapless victims of his newest trick. “Ghar pe shaadi hai,” he smirked at one point, “lekin paisa nahin hai.” (There’s a wedding at home, but there’s no money.)

By then, serpentine queues had formed outside banks back home in India even as petty shopkeepers waited in vain for customers, and perishable goods rotted for want of takers. Modi’s ill-timed mirth introduced into the pervasive atmosphere of pain a jarring note of dissonance.

Magicians, Nakul explained, have what they call “an out” — a word that covers the many ways in which they distract attention from their mistakes and rehabilitate an act when it threatens to go off the rails. Modi’s “out” came just 24 hours later. It doesn’t figure in the Iconic Speeches category on his website but it is, to my mind, one of the most compelling examples of political theatre.

For the first 23 minutes of his November 13 speech to a full house in Goa, Modi strummed the singular note of parochial pride. He praised Goa as by far the best of the smaller states in the Union; he enumerated the many schemes that had made Goa a paradise; spoke in wondrous terms of more schemes being launched that would trigger a gold-rush of tourists who would outnumber locals two to one; he even congratulated Goa on gifting to the nation the strongest defence minister India ever had. If his laudatory portrait of the “visionary” Manohar Parikkar bore little resemblance to the motormouth who talked about gouging the enemy’s eyes out and who boasted that terrorists couldn’t enter the country without his permission, the crowd by then was too thoroughly marinated in a sense of its self-worth to say nay.

22 minutes into his speech, Modi signaled a change of subject and of tone. Then he paused. He sipped water. He coughed. He let the silence build. He succumbed to another coughing fit. The suspense built. The audience held its collective breath. The dignitaries on stage whispered their concern to each other. “On the 8th,” Modi began. And he paused, with a knowing smile and nod. The audience tittered in relief – all was well with Modi, and he was going to talk to them of serious things.

It was magic.

Teller, the genius half of the legendary duo of Penn and Teller, in an article for Smithsonian magazine (and a lecture-demonstration for the Mind Science Foundation) revealed the seven psychological elements of a successful magic trick.

“It is hard to think critically if you are laughing”

Modi began act two of his passion play with a feather-light tickle of the audience’s funny-bone. Across the country, he said, crores of people are sleeping peacefully in their beds. But the corrupt, numbering a few thousand, cannot sleep; they try to buy sleeping pills but they can’t get any because, no money.

The illusion he conjured up had the audience in splits. And an audience that is laughing is an audience that is not thinking – thus, it never wondered for a moment why those imagined insomniacs couldn’t get their fix, given that the demonetized currency remained legal tender in pharmacies.

“It is not misdirection,” Nakul Shenoy once explained. “It is actually direction – the illusionist deliberately directs your attention to what he wants you to see, not away from what he does not want you to see.”

That was the essence of Modi’s skill here: with one line, he directed the collective attention away from the frustrating hours they had spent in line and from the stories of Punjab’s Sukhdev Singh and other demonetisation-induced deaths that had begun to trickle in, and he had them laughing at the illusion of corrupt plutocrats tossing and turning in a fever-fit of despair.

He fooled them because they wanted to be fooled into believing that their own hardships had somehow been worth it.

“Nothing fools you better than the lie you tell yourself”

With supreme skill, Modi then set out to make the audience complicit in demonetization (a favorite trick, which most recently has him sharing the ‘credit’ for the disastrous GST rollout with the Congress). He planted in their minds the thought that whatever he had done was with their mandate, and at their bidding, and in defiance of the wishes of entrenched vested interests. His voice broke, his speech faltered as he spoke of his disinterest in power; his voice gained in timbre and brio as he spoke of the gigantic battle he had launched.

He spoke, as he always does, in broad binaries that left little room for nuance. He organized his argument along simplistic dichotomies; he painted an uncompromising image of a virtuous nation versus a corrupt few. He aligned his audience, with himself in its midst, on the right, white side of this black and white argument. And through stunning sleight of mouth, he inversed the reality of November 8. Demonetization was not a hasty, ill-considered move foisted on a country without sufficient planning and preparation but rather the realization of the collective will of the people; he, Modi the Modest who had never aspired to high office, was merely their chosen instrument.

“Exploit pattern recognition”

Watch Teller repeatedly produce coins out of thin air. Repetition creates patterns. Patterns prompt recognition, which in turn creates a knowing anticipation – you begin to see what is coming next, and this fills you with a sense of your own cleverness. Without conscious volition, you buy into the lie being sold – Teller’s coins out of thin air, Modi’s villains out of straw.

Building up a nice rhythm, Modi created repetitive patterns that played into his narrative of the virtuous poor against the evil rich. He conjured up villains: the ultra-rich with their foreign bank accounts; the rapacious real-estate agents who colluded with the corrupt in benami land deals; the jewelry establishments that aided and abetted those who sought to convert their black money into gold and diamonds…

The pattern repeated. New villains were introduced; Modi – the chosen champion – joined battle against these forces of evil and vanquished them; he spoke of even bigger battles to come, and allowed the audience to anticipate the victories that would follow.

“If you are given a choice, you believe you have acted freely”

Aapne mujhe kaha hai ki nahin? (Have you not told me…?)

Modi repeatedly used the evangelical call-and-response format to create the illusion that the audience, and by extension the country, had voluntarily engaged in this titanic struggle knowing full well that it was fraught with short-term pain. It was their choice, not his whim; it was their mandate, not his will; it was their fight, not his folly.

Arms flailing, palm slapping against his 56-inch chest, voice climbing effortlessly through the octaves, Modi launched into an extended fire-and-brimstone peroration (see from 58:47):

Mujhe Goa-wasiyon ke aashirwad chahiye. Aap khade ho karke mujhe aashirwad dijiye! Desh dekhehga. Desh dekhega ki iss desh mein imandaar logon ki kami nahin hai. Aayiye, aayiye, imandaari ke iss kaam mein mera saath dijiye… sabaash, mere Goa ke pyaare bhaiyon aur behenon, main aapko sar jukhake naman karta hoon… yeh sirf Goa nahin, yeh Hindustan ke har imandaar ki awaaz hai…

(“I want the blessings of Goans. Stand up and bless me! The country will see. It will see that there is no dearth of honest people in this country. Come, come, join me in this act of honesty… Bravo, my dear Goan brothers and sisters, I bow before you and pray… this isn’t just Goa’s but every honest Indian’s voice.”)

Bhaiyon behenon, main jaanta hoon maine kaise kaise thakaton se ladayi mod li hain… main jaanta hoon kaise kaise log mere khilaf ho jayenge, main jaanta hoon… sattar saal ka unka main loot raha hoon, mujhe zinda nahin chodenge, mujhe barbaad karke rahenge… unko jo karna hai karein…

(“Brothers and sisters, I know what kind of forces I have taken on… I know what kind of people are against me… I know… I’m taking away 70 years of their wealth, they won’t leave me alive, they will destroy me… let them do what they may…”)

What Teller demonstrated with a card trick, Modi performed with simple sleight of words. Oof.

The novice magician makes objects vanish – a simple feat of manual dexterity. The adept transforms the vanished object into something else altogether – the ball into an orange; the scantily clad assistant into a tiger. Modi the political prestidigitator used this speech to pull off a similar vanish-and-transform.

Prashant Jha, the political analyst and author of the recent best-seller How The BJP Wins had, on the sidelines of the recent Bangalore Literature Festival, given a select few of us a masterclass in Modi’s skill at problem-solving.

Rahul Gandhi’s most effective intervention, Jha said, came in course of a speech in Parliament on April 20, 2015, where he accused the Modi government of being a “suit-boot ka sarkar”. The barb bit deep, said Jha; it stung, it clung to the BJP like painful burr on sensitive skin. With assembly elections in Uttar Pradesh looming, Modi had to transform. The friend of the suited and booted plutocrat had to vanish; in his place, a messiah of the poor needed to appear.

Modi’s reinvention had its genesis in this speech. “I am doing this,” he said, “for the honest among us. I am doing this for the poor of our country.” (As I write this, IndiaSpend reports that the Center has not released MNREGA funds to pay those poorest of the poor – but magic is not about the reality that is; it is about the alternate reality you willingly buy into.)

Eyes flashing missionary fire through the Bulgari glasses he favors, Modi in one stroke repudiated his alleged sympathies for the rich and aligned himself squarely on the side of the poor and the downtrodden. The misdirection was complete; he would build on this narrative on the stump in UP, and ride this incongruously populist image to a stunning win.

It never occurred to the adoring crowd to think of the last mile in that argument; it never occurred to them to wonder how demonetisation would put a roof over the poor man’s head and food in his belly, just as it hasn’t occurred to those still high on the demonetisation Kool Aid to inquire into the curious case of the corrupt jewellery merchant.

Remember (watch from 31:05)? In Goa, Modi set up the gold and diamond merchant as a villain and spoke of how he had vanquished them with a law making the PAN card mandatory for the purchase of jewelry in excess of Rs 2 lakh. It was, he suggested, a masterstroke in the battle against black money – and yet, just 11 months later, the Modi government reversed its earlier notification when it decreed that no PAN or other identity proof was needed for jewelry purchases in excess of Rs 50,000. (Ironically, gold imports are now surging, indicating that with the shackles removed, people are converting black money into gold.)

That is by no means the only example of Modi’s bait-and-switch. In the immediate wake of demonetization, Modi backed the Election Commission’s move to cap anonymous donations to political parties at Rs 2,000. This was reiterated in his government’s fourth budget, in February 2017. A month later, The Finance Bill 2017 introduced layers of opacity which effectively ensured that corporates can donate any amount they like, without disclosing the name of the party they were contributing to.

Elsewhere, even as Modi directed the popular attention to his supposedly ceaseless battle against corruption, the BJP has been swelling its ranks with every corrupt politician it can buy or subvert, including the likes of BS Yedyurappa who, back in July 2011, had by party diktat been forced to quit office because of corruption charges and who, more recently, was caught on a leaked video talking of bribes to the party’s high command; Sukh Ram, a convict in the 1996 telecom corruption case; Narayan Rane of Maharashtra and, most recently, Mukul Roy of the Trinamool Congress who, as recently as September, was being summoned by the CBI in the Saradha chit fund scam.

Back in April, the Center opposed in the Supreme Court a PIL that sought to bar convicted politicians for life. The government has been fighting the wrong side of the corruption argument even as the Election Commission calls for a life ban and the Supreme Court asks for the cases to be fast-tracked — a bizarre stance, given the anti-corruption credentials the BJP sells at the hustings like so much snake-oil.

In Himachal Pradesh, where the elections are underway, 61 candidates have criminal records. Of these, 23 belong to the BJP and a further 16 are “Independents”. Allowing cases against politicians accused of corruption to drag out in the courts while they continue to fight elections and hold office is a classic instance of justice delayed — remember the case of Rajnath Singh’s son Pankaj, to cite one example?:

Home Minister Rajnath Singh on Wednesday denied rumours of misconduct on his or his family’s part as he said he would quit politics and sit at home if such charges are even prima facie proved. …

According to reports, the home minister has told senior RSS leaders that the party insiders were spreading rumors that Prime Minister Narendra Modi had scolded Pankaj, in Rajnath’s presence, for taking bribes for police posting.

The party’s bait-and-switch tactics on the issue of political corruption is best exemplified by the comment of BJP spokesperson Sudanshu Trivedi who, on the subject of the recently whitewashed Sukh Ram, said “Jo beet gayi woh baat gayi” (Let bygones be bygones), even as Modi framed demonetization as a fight against the endemic corruption of the last seventy years.

It is not that the premises and practicalities of demonetization haven’t been questioned – they have. Go to any website of your choice and search within it for the term ‘demonetization’, and you will find a year’s worth of questions and highly detailed fact-checks.

The problem, therefore, lies not in the lack of questioning, but in the nature of Modi the political animal. In the 31 days of October, Modi has made 14 speeches; a back of the envelope calculation suggests that the tally for his prime ministership is approaching the 800-speech mark. To all outward appearances, he is the ultimate communicator – when he is not on stage, he continues to communicate through his Mann ki Baat radio addresses and his app and his Facebook page and through Twitter. He has, thus, nurtured the perception that he is the antithesis of his predecessor, whom he mockingly referred to as ‘Maun Mohan Singh’.

By directing your attention to this ceaseless stream of words, he deftly deflects attention away from the fact that he has not in all this time held one single, solitary press conference. His milieu is the stage, from where he declaims with a thespian flair that camouflages a casual unconcern for facts, for truth; he glides from falsifications to fake narratives almost faster than the mind can follow; at no time does he allow himself to be trapped in a situation where questions can be asked, where disagreement can be voiced and dissonance aired. His modus operandi draws on one of the hoariest acts in the history of magic.

Seneca wrote of cups-and-balls as far back as two thousand years ago, and contemporary masters such as Tommy Wonder have mystified audiences with this oldest trick in the book. But Modi goes one better; his political performances are kin to the likes of Penn and Teller and Jason Latimer, who perform the trick with clear cups. You can see right through the prop and yet, the balls pass through solid cups, jump from cup to cup, disappear from one cup and reappear in another, and even transform into other, larger objects, all at dizzying speeds that leave you thoroughly confounded.

Demonetisation is best understood as political cups-and-balls. It started out under the ‘black money’ cup, but suddenly it wasn’t there. It was supposed to be about checking counterfeits, only it didn’t. It was about checking terrorism and insurgency, but then it wasn’t. It was supposed to reduce the amount of high-value currency in circulation, only it hasn’t. It was supposed to spur a digital economy, only it hasn’t. It was supposed to provide a booster shot to the economy, only it didn’t. It was supposed to widen the tax base, only, well, not so much. It was supposed to be about a nation rising as one to back Modi’s play — in Goa, for instance, Modi took special care to praise bank employees who had labored long hours during the early days of demonetization. hose bank employees are now threatening to strike as they have not been paid the overtime that is their due.

Every single time an “objective of demonetization” is debunked by facts, the ball vanishes and mysteriously pops up in another guise, under another cup. Meanwhile, new narratives continue to be fashioned even as older narratives are shredded. And to aid him in his smoke and mirrors act Modi has, magician-like, pressed into service a corps of assistants scantily clad in fact. The party’s IT cell has pressed into service its vast online army to propagate templated tweets lauding demonetization’s success and to shout down any and all attempts at questioning. His Cabinet colleagues have been reduced to cut-paste propagandists. His Finance Minister has, as recently as last month, continued to talk up the tired, discredited demonetization tropes of decline in terrorist activities, of conversion to a cashless economyboosting the economy, ending crony capitalism and tax evasion and fake currency and…

In Rajasthan, the fiasco of demonetization is sought to be covered up in the last refuge that is patriotism – on November 8, per Chief Minister Vasundhara Raje’s fiat, 50,000 people are to gather in Jaipur and sing the national anthem to celebrate demonetization. And on the same day, the ruling party and the government is poised to celebrate ‘Anti-Black Money Day’, despite there being no evidence that demonetization has made the slightest dent in the black component of the economy.

The PM’s finely honed thespian skill, in tandem with the party’s propaganda megaphone, has been harnessed over the course of the past year into a pan India game of cups-and-balls. And yet, all the rhetoric has been unable to camouflage one central fact: the edifice of demonetization has been constructed on dangerously unstable quicksand.

When the spell of his eloquence fades, when the curtain falls on his compelling act and our collective pulse returns to normal, we are left with the one bitter realization: the prime minister is a magician who is all hat and no rabbit.

(PostScript: My thanks for the many kind responses to this piece on social media and in email. I notice though that several of those who praised it were particularly complimentary of the “all hat and no rabbit” line. PSA, that is not original. Back in 2004 when George W Bush was campaigning for re-election, I remember a commentator (I cannot recall who, unfortunately) used the line “all hat and no cowboy” to describe him. The line stuck, and I used a variant here. Apologies if I inadvertently misled anyone.)

14 thoughts on “Of demonetization. And magic. And Modi

  1. Sir, you have rightly highlighted how demo has been “demo”nstrated to be for the benefit of the general public when it is totally against their interest. One thing that media has not been highlighting is the issue of Banks in the whole thing. During a discussion with a friend of mine, who works in a bank, he highlighted some of the costs of demo which the banks have borne but the centre is just not bothered. The major costs incurred include:
    1. The weekend following the announcement of demo was made working for all employees. All banks had to pay overtime to their clerical and sub-staff (non-officers) and arrange food, etc.
    2. All the employees were only involved in cash collection, verification and sorting of notes and no other business was conducted till about 15th Dec. You may notice that while SB/Current balances went up that quarter, most of the banks reported drop in advances, resulting in decrease in interest income.
    3. Many good borrowers who were regular in their loan repayments found that they had a lot of cash and they deposited in their loan accounts. This also resulted in drop of advances. Further since good customers repaid their loans (and advances shrunk), NPA as a percentage went up. This also resulted in a mismatch of banks funds since banks manage funds based on maturity profile and prepayment of loans results in mismatch
    4. Transportation of excess notes to chest involves use of armored vehicles. On normal days, an outsourced van would make one trip carrying cash and distributing it to the branches on its route. But during demo, banks had to hire armored cars many times a day to dispose the cash to the nearest “chest” branch and bring new notes. Each armored vehicle is required to be accompanied by a security guard, a clerk and an officer, who need to paid TA/DA apart from other costs. Further above certain limit, banks have to hire an armed police whose costs also are to be paid by banks
    5. Many banks had to hold cash in their chest much beyond the sanctioned limits since RBI took its own time to lift the notes. The Banks had to arrange extra security guards, take higher insurance cover and monitor round the clock. (these are what I recall from the discussion).

    All these costs were borne by banks silently since “it was in public interest”.

    And now my friend says, banks have been asked to provide aadhaar facilities in 10% of the branch premises as a compulsion. Initially it was stated that Banks only need to provide seating space for an authorised agency (2 persons) who will collect the bio-metric details of the public. But recently UIDAI has directed banks to provide staff to do the above work.

    While I do not have much sympathy for the overindulged unionised bank employees, all the above costs are being borne indirectly by us, general public, by way of increased bank charges for everything. Even SBI was in the news for such charges.

    • While you talked about one important dimension of impact to banks, the most important aspect about demon is NOT spoken at all. It is about the 30% commission that was collected for converting money from Black to White.
      1. WHO (which bank officials, politicians, from which party etc) helped the people to convert the money?
      2. How many such lakhs of crores of rupees were collected as commission? What is the approximate total amount collected as commission?
      3. Why media avoided probing/discussing about it? What was the role of media in this?

      • IIRC, Muthu, you had asked this question earlier, in my callout post on demonetization. At this point, I don’t have much of an answer, but I suspect that within a month or two you will find the question addressed in the media — I know of at least one media house that is attempting to dig deep into this question. Will update as the story surfaces. Cheers

    • Pardon me for interrupting as this is PP’s blog. Nonetheless, I would like to put my two pennies worth…as the case that you have put forward is interesting…extremely interesting….And as you mentioned, very few have sympathy for these people as most of the costs are off-loaded onto the poor public…..but this subject needs to be looked into…thank you!

    • Thanks for this, Hari, and I agree totally. As do the bank managers I know and with whom I have been regularly chatting about the fallout of demo. I’ll pass on this comment of yours to them, and also to a couple of friends in the media who are economy-savvy, and can dig into this and write with precision. Best, me

  2. Splendid PP …At least some people are beginning to realize this…and I have been trying to tell this to the people from 2013…

    I said this for the Donald as well…. Unfortunately, he is finding it difficult to hold fort, (going against the media etc..). He is unable to deflect attention away like The Modi (whom we must give credit for not having held one single, solitary press conference till date! Talk about pulling wool over one’s eyes)… but the Donald is learning fast… Meanwhile, Hillary seems to have still not got over it.

    When the spell of his eloquence fades… we are left with the one bitter realization: the prime minister is a magician who is all hat and no rabbit…. By which time, do we have any choice?

    That’s why I dedicated this to him…

    Unfortunately, this seems to be the new precedence…

    • it would help if you can specify what are the points that you are disagreeing with in the post. If you are disagreeing with everything in the post (which seems to be the case), it would be better if you can clearly articulate your point of view with a detailed post. Just saying “Disagree” doesn’t help anyone to have a proper discussion on the subject.

      • Disagree with each and every point in your article. Its not all a biased one sir. Article is showing only one facet of demonetization which is very well farmed, i agree you hv put the truth up to some extent. But you will surely see longterm benefits from demonetization sir. That’s my catch. And many more positive aspects are there. Its easy to be critics of everything. GST if very goid move. Khachra saaf kiye bina swacha tha nai dikhti hai sir, numbers will go down, but sooner money will rotate in economy formally.

        • I am not sure I understand: you say you disagree with each and every point. You also say I have put the truth up “to some extent”. I am not sure how, therefore, you disagree with the truth, to whatever extent it is here.

          But never mind that. I hear plenty of people say there will be long-term benefits. Great, when it happens I will certainly post about it too. But for now, I would like someone to explain this to me. To answer one simple question: how?

          There is no “long-term” for demonetization. Demonetization is the withdrawal of currency from circulation. It happened. Then fresh currency was introduced. The cash in circulation is back to where it was. As of today, there IS no more demonetization, therefore there is no “long-term” benefit in the offing.

          As for GST, if it is such a good move, again I would like the answer to a simple question: Why then does the GST council, every other day, have to change the rules, exempt some items, lower the rates on other items, etc? By the way, the former finance secretary is on record as saying the loss thus far thanks to GST is Rs 60,000 crore, estimated. I’d like the finance minister to explain how he plans to make up that loss. I’d like him to explain how he hopes to compensate for the losses caused by first demonetization, then GST.

          It is easy to say “in the long run things will get better”. What is needed is for someone to say, how? And by the way, what is the deadline for this “long term”? When do we see results? Next quarter? Next year? Next decade? When, exactly? The PM said 50 days. One year has passed and we are still saying “in the long run”.

          You say it is easy to criticize everything. I will merely point out this: snake oil is not good for you. It is your right, and your duty, as a citizen to hold the government to account, to ask for and get answers. You may or may not, as your inclination suggests, Vishal, but I certainly intend to.

          Cheers, be well.

          • Yaa i would in short question government about implementation. But these moves how to come as to open up the economy n be competitive sir. U hv raised a valid point, what long run? Thank you.

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