Friday, March 24, 2006

Middlemen

Admiral J.G.Nadkarni (retd) has written an op-ed piece in DC in support of legitimising middlemen in arms deals. Going by its contents and the logic employed, I am glad that he has retired from the navy and no longer has any say in the way defence matters are being run.

The essay starts by incorrectly comparing these middlemen to dealers in car showrooms and travel agents. This comparison then neatly segues into kickback territory by including the shady operators in the RTOs who enable people to bypass the system and obtain driving licenses illegally. The implication being that people in the first category are no different from those in the second.

He then argues that ever since the government has banned these middlemen, the defence establishment has found it very difficult to obtain spare parts, since the middlemen performed this service admirably when they were allowed to ply their trade. What a load of crock. If you buy something from somebody, it is only reasonable to expect them to provide after-sales service and support; there is no role here for the middleman. It's not like it's very difficult for the arms manufacturers to do this on their own.

Next comes this:
The embargo on dealers is based on a number of myths. It is generally believed that agents bribe their way to procure orders ... While this may be true, the elimination of middlemen will not stop corruption. There are even major bribes when governments deal with each other.
So it's not really a myth. Also, if we eliminate middlemen, at least some of the corruption would go away? Sounds like a good deal to me.

Finally, there is this gem:
If the government is confident about the integrity of its staff where is the question of corruption?
I believe this is called 'the fallacy of many questions'.