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Air India Sticks it to the Poor

Air India Sticks it to the Poor

Over the past eight days, I boarded thirteen separate flights as I hopped across the Asian continent. I spent the most time in India. Actually, I spent time in “both Indias,” a phrase my Indian friends  used. I visited the skyscraper-heavy financial district in Mumbai and met families in slums nearby. I drove past the most expensive house in the world and walked through one of the world’s poorest shantytowns. Both Indias.
As a connoisseur  of fine airlines (e.g., Southwest, my favorite), India’s airlines impressed me. I flew Jet Airways several times and they did everything right: Prompt departures, quick boarding, no fees, and friendly service. It was hard to believe this upstart airline didn’t exist just seven years ago. Actually, seven years ago, there was only one airline in the country: Air India.

Air India – Source: iFreshNews

Until 2005, the Indian government held a monopolistic stranglehold on the aviation industry. Air India was the only show in town. And it was a really bad show. Prices were sky-high, service was terribly low and Air India consistently lagged in innovation. It is a classic story of government-intervention-gone-wrong.

The real victim of Air India’s failure, however, was the poor. Not only could they not afford to fly, but they also were continually forced to bail out the floundering “business.” As taxpayers, they were on the hook for Air India’s failure. Created under the auspices of “protecting the Indian people,” Air India did exactly the opposite. The vitriol for the company by the people of India is apparent. On my final flight home, I thumbed through the pages of The Telegraph, an Indian newspaper. The editorial title about the airline summarized the country’s sentiment: “A long, sordid and pathetic tale of failure.” 

Riddled with inefficiencies and waste, Air India was actually crippled while I was in the country. The entire staff has gone two months without salaries and they were on strike last week. The editorial reviled in the failures of the airline, noting for example, that they recently purchased new planes without doing any price negotiation whatsoever with the manufacturers.

Jet Airways and a handful of other upstart airlines like IndiGo are charting a different and refreshing course, however. Led by aggressive Indian entrepreneurs, these budget airlines deliver on their promise to customers. And, they bring abounding opportunity to the poor. The data doesn’t lie: Since 2005, air traffic in India has tripled, fare prices have dropped dramatically and the quality of service has increased.

I’m an admitted believer in the power of entrepreneurship and the free markets. While not without its warts, I’ve argued that capitalism is the “best broken system” for the most vulnerable in our world. There is a role for government in helping the poor, but Air India illuminates that sometimes the best social service they can do for the poor is unleash the Indian entrepreneur to be the solution. Jet Airways, IndiGo and SpiceJet are up for the challenge; and the world is opening up to low-income Indians as a result. SpiceJet’s motto says it all, “Flying for Everyone.”

Unlocking Cuban Creativity

Unlocking Cuban Creativity

At first glance, the article reads like a first-hand account of a post-disaster country: “Streets once devoid of commerce in towns like this and in Havana are gradually coming to life…” The scene Victoria Burnett described in her New York Times article was not of a country recovering from a natural disaster or civil war. Instead, it depicted her journey through Cuba, a country whose people have been reawakened. She experienced the buzz of vibrant entrepreneurship: Unshuttered storefront windows, machinery re-tuned and whirring along till late in the night, rich smells of freshly-ground coffee beans, and the hum and excitement of restaurateurs promoting their newly-minted menus.
Cuba gives us a real-time snapshot into the spirit of innovation. For decades, unrealized dreams and untapped abilities were locked within the failed Cuban socialist system. The government-imposed chains have now been cut loose. In a move of genuine humility (at best) or desperate self-preservation (at worst), Cuban leaders have admitted that the Cuban people are better positioned than their government to innovate and to address their country’s problems.
The Cuban rebirth unearths the soul of HOPE International’s work. At the core, we believe that God—the innovator of the solar systems, mountain ranges, and human emotion—has planted a glimmer of his creativity in us. When given the opportunity to do so, people will put that gift to work. Architects, chefs, artists, entrepreneurs, electricians, florists, educators and scientists each apply their God-given creativity in uniquely profound ways. Now, for the first time in decades, Cubans have the chance to do the same.

Photo source: Jose Goitia, The New York Times

Our role as those with abundance is to do more than solely provide for those in need. Our calling is far greater than providing food for hungry bellies and medicine for sick bodies. We are surely called to do these things, but also called to unleash the God-given creativity of those in need. To fuel the imaginings of those without the privilege of exercising their creative muscles.
As I watch Cubans taking small steps toward these ends, my spirit is energized. Tomorrow, I will fly to another Caribbean nation – the Dominican Republic. While there, I will observe the fruits of Dominican innovation. I will feast on slow-cooked and fantastically-marinated rice and beans, enjoy the sweetness of freshly-harvested fruit smoothies, and perhaps purchase a bottle of home-brewed shampoo. I will meet entrepreneurs who are using the abilities and engaging the dreams which God has sowed within them. The Dominican economy and its people are flourishing. Let’s hope Cuba is right behind them.

The Tragedy of Soviet Apartment Buildings

The Tragedy of Soviet Apartment Buildings

Perhaps the most enduring symbol of the Soviet experiment is their architecture. During the spring of 2007, I lived in an oft-forgotten corner of Romania, working to expand HOPE’s work into the country. As with all former Soviet republics, Romania’s cities are filled with massive apartment blocks, exemplified in this picture which was taken from the window of the apartment where I lived.
Galati 040

Romanian Apartment Block

They aren’t pretty. These concrete, gray monstrosities line every street, each one in a different state of disrepair. Not only do they blight these communities, but it also made navigating Romanian cities a nightmare (try finding your apartment when all the buildings are carbon-copies of one another).
The shared common space of the buildings was disastrous. The façade, lobbies, and stairwells –the commons–were always in terrible condition. The interesting thing about these buildings was that once you reached the door of the apartments, the “home” began. Inside, many of the apartments were actually quite nice, though you’d never know it from the outside.
The Communist regime built these concrete palaces but did a poor job (read: terrible) of maintaining them. Individuals buy the apartments within the building, but not the building itself. As a result, nobody maintains the lobbies, the landscaping or the exterior walls. Individual apartment owners simply fend for themselves, meaning the majority of urban Romanians live in ugly housing. The Romanian government proved time-and-again that it was a terrible landlord.
Under Communist systems, the government serves owns the real estate. The tragedy of the commons is just one of a litany of Communism’s fatal flaws.  We see glimpses of this economics reality every day in simple things like the way we drive rental cars (versus our own cars) and in the condition of dormitory bathrooms. Successful economic systems take the tragedy of the commons seriously, acknowledging that when “everyone owns it, nobody does.”