Raghuram Rajan – Some People ARE Indispensable!

Ever since the controversy over Raghuram Rajan – the governor of the RBI, I’ve been hearing a lot of statements like this:

“No one is indispensable”
“India has lots of talent. Replacing Rajan is easy”
“The RBI will survive anyone’s exit”
“No need to make such a fuss over a single individual”
etc, etc

Now I’m no economist, so I will simply go with the popular consensus amongst his fellow economists that Raghuram Rajan was an outstanding governor of the the RBI. Like the debate on global warming, in the absence of high expertise and years of study, I’ll just defer to the experts in the field. So that’s the premise. That Rajan was a great match for the job.

However, this mentality of “No one is indispensable” reveals a lack of respect for an individual’s contribution and treats them like Lego blocks that you can pull out and replace without affecting the integrity of the structure. It’s a very “Indian” way of thinking, and I’ve heard it often. Management is encouraged to treat employees like uniform units, not to bend over to any individual’s whims and fancies, and everyone is taught to be a good worker bee. Uniform. Non confrontational. Boring.

Except, that talent – true talent – is always going to be eccentric. There’s a Latin saying “Nullum magnum ingenium sine mixtura dementia fuit”, meaning “There is no great genius without an element of madness”. And if companies and organizations want to hire – and retain – the best talent, they will simply have to put up with those eccentricities and fight to retain them.

Because people matter. Great talent is rare. And even rarer, is great talent with the courage to do what is necessary in the face of criticism and personal risk.

Recently I was reading about the demise of Yahoo!, and how its great failing was the reluctance to hire the very best programmers in the industry. Yahoo became a company of “suits”, treating all programmers like interchangeable parts, going with the philosophy that “no one is indispensable”. On the other hand, companies like Google and Facebook actively court and struggle to retain top talent. They fight amongst themselves. Good programmers are courted, indulged, given leeway, and paid tremendous salaries. They know the value of good people. And their organizations benefit as a result.

It’s a characteristic of Asian countries (and perhaps even Europe), to treat the individual as less important than the organization or country they belong to. The hive mind. The blending in. The “be modest and keep your head down” mentality is glorified. I’ve seen it with my own eyes. “Don’t stick your neck out”, “Don’t draw too much attention to yourself”. “Don’t brag”. Organizations in India don’t strive for the best talent. They don’t glorify it. But the very best companies know its true value. Companies like Tesla, Amazon, and Twitter lay out the red carpet for talented individuals.

Can the RBI survive without Rajan? Of course! The RBI building will still stand. The organization will continue to exist. But will it be as effective? Do we just want “ok ok” performance, or do we want the very best? If we want quick turn arounds, and great performance, then we have to be willing to give up the “no one is indispensable” mindset. Not just the RBI, but all our government institutions will need to scour the length and breadth of the land to attract better people. Do whatever it takes to bring them in. Indulge them, pay them through the roof. And reap the benefits.

But if you treat people like replaceable Lego blocks, then you will have mediocre organizations. Because great people are hard to find.

What do you think of this post?
  • Agree (4)
  • You're an asshole (1)
  • Don't Agree but Interesting (0)

33 thoughts on “Raghuram Rajan – Some People ARE Indispensable!”

  1. Fantastic analysis based on “hard-core” facts. Having lived and worked in the US myself for 21 years, I completely agree….the Modi government is looking for a “yes” man to toe the line! And there are plenty of them around!

    This is why India cannot retain the best talent. Tough luck – they create “brain-drain” themselves and then whine about it!


    • In reply to Jayanthi Sankaran

      I am curious. Suppose any firm in the US you may have worked for is doing a grand product launch. The media asks excitedly about how awesome that product is. And one of the company’s top execs makes a massive public announcement to the media that the product actually sucks big time, but is like a “one-eyed king”. Are you telling me that exec is gonna keep his job after that?


  2. Bhagwad,
    I feel that the only thing that is truly indispensable is critical thinking. What do you say?

    So, why not apply critical thinking to Raghuram Rajan? Instead of vague, factless praise, let us pick one by one the great and good qualities mentioned about him.

    Let’s take the idea, for instance, that Raghuram Rajan stood up to “crony capitalism”. This is kind of mysterious, because Rajan never said anything about 2G scam and coal scam. Is it that Dr. Rajan is a reticent person or is it that Dr. Rajan discovered his voice only after a certain Prime Minister came to power? He gives opinions on cow-beef-intolerance, but not on 2G scam but is somehow still a warrior against crony capitalism…

    Let’s take Raguram Rajan’s great achievement of “spotting” the 2008 financial crisis. First of all, you should actually look up his famous paper from 2005. All it says is that there might be “risks” at some undetermined point in the future. For any given economic policy anywhere in the world at any point of time, I think there will be at least one expert who predicts “risk” at some point in the future. If this is the standard for prediction, you might want to speak to some renowned astrologers before investing in the market tomorrow.

    In fact, if you google (sorry, I am currently visiting China… no Google here) you will find that Dr. Rajan predicted another global crisis in mid-2013, in mid-2014 and in mid-2015. None of these actually came true. People forget the misses and remember the hits. Especially if you say something bad is gonna happen and it doesn’t happen, people don’t really mind. This is the same technique that astrologers, tarot card readers, etc. use the world over.

    Now, of course I am not saying that Dr. Rajan is in the same league as an astrologer. What I am saying is that do not get carried away by ONE vague “prediction” that he might have got right (seriously…read his paper that “predicted” the 2008 crisis…you won’t find any explicit prediction anywhere.)

    Finally and this may be the most important point, the concerns being raised over Rajan’s exit point to an attitude problem that you elites (you used group names yourself in your famous post about engaging the right…so don’t blame me now :) ) have towards the Narendra Modi government. Appointing the RBI governor is Modi’s prerogative, just like it has been for every single PM before him. No, Narendra Modi is not a caretaker or stopgap who is supposed to keep the seat warm and not rock the boat until the “legitimate” people come back to power. Modi IS the boss. And it is the responsibility of the RBI governor to show him that respect. No one in the elite questioned the credentials of Sonia ji or any of her slaves for sitting on the National Advisory Council. But every time Modi appoints someone to any office, no matter how big or how small, the elites in India want to scrutinize and second guess it. A perfect topical example are the accusations that Pahlaj Nihalani is “unqualified” to run the Censor Board. I am curious about who could be “qualified” for the office of supreme arbiter of what people in a free country should be allowed to watch on film… When the Gandhis make a decision, the elites see them as merely exercising their birthright. When Modi does the same, he is “harming institutions”. Sorry, but Modi rules with exactly the same legitimacy as any of the Gandhis did (except during the Emergency, when they were ruling illegitimately).

    And accusing Modi of appointing “yes men”? Really? In India’s political scene consisting of Sonia, Mamata, Jayalalitha, Mayawati, Mulayam, Laloo, Kejriwal, Chautala, etc, is anyone seriously going to accuse Modi of being the person who is surrounded by “yes men”? Heck, the man won the greatest parliamentary tally in 3 decades and was not even given a single 3 year term as BJP President! The other prominent politicians I mentioned are all lifetime presidents of their parties, no matter how badly they lose elections. Yes, Modi is surrounded by yes men…LOL.


    • In reply to Sumit

      Most of what you’ve said doesn’t deal with the post topic, so I’ll respond to the main relevant point:

      Rajan’s competence: In this matter, I simply outsource my thinking to his current academic peers. Economics is a field of study I only have a little knowledge about, so I am not giving my own opinion about his competence. Especially since Economics is not a pure science with easily replicated experiments that one can read follow and make up one’s mind about. Peers in his field have said he did a great job, so I will blindly listen to them.

      If his peers say he did a terrible job, I will blindly adopt that view as well. I know it’s easy to pick and choose facts and ideas to suit one’s position, and I am not enough of an expert to know which facts counterbalance the others.


      • In reply to bhagwad

        In science, for instance, what scientists think is important, but nature/evidence has the final say no matter what. In politics, what pundits think is important, but the voters have the final word. In economics, what economists think is important, but the money has the final word.

        What did the money say? The markets actually rose 241 points on the Monday after news of his exit. Since then they have been flat, waiting for the final word on Britain’s referendum. So, well, the verdict is in, Raghuram Rajan wasn’t even a blip on the investor’s radar. Final word.

        You suggest that I might be picking and choosing. Have you considered the possibility that the elite English media might be picking and choosing what economist have said? Surely you have seen the famous English mediaperson who hates Modi to the point that he physically attacked Modi supporters in NY. Now I leave to you if economists really said what you think they said…

        But here is a fun question. How do you know that Rajan was treated like a “replaceable lego block”? Can you show me a written order or letter from the PMO or the Finance Minister saying he should be treated badly? When Rajan announced he was leaving, the government actually praised his tenure and thanked him for his service. So show me the evidence he was treated badly.

        You were being so literal about whether JNU students support Stalin’s massacres. You wanted written confirmation. Now, would you be so kind as to show me a written order from the Modi government to treat Dr. Rajan badly? Or this time we have to go by hearsay and rumor and read between the lines?


      • In reply to Sumit

        We often need scientists to interpret the evidence for us – because science is too complex these days for us to understand it. Similarly, I am not going to try and interpret Rajan’s results myself.

        And where did I say that the PMO or the government treated Rajan badly? Can you show me where I made that claim?


      • In reply to bhagwad

        Bhagwad, stay consistent in your “literalism”.

        Then why are you relating Rajan’s departure to work culture, retaining talent, suits, this and that. What are you referring to when talking about “treating people like lego blocks”? How is this connected to Rajan? If there is no connection, please let me know.

        First, show us the evidence that Rajan’s departure has absolutely anything at all to do with his work conditions as RBI governor. Maybe he really misses academia. Maybe he misses Chicago. Maybe he once took an oath not to work more than 3 years in any country whose English name starts with an “I”. Unless you can show the connection, what is the point of your post?


      • In reply to bhagwad

        It’s a simple question, Bhagwad. What is the connection you see between the exit of Rajan and various comments you make on “treating people like lego blocks”, your comments on Google and Yahoo etc?

        If you are saying there is a connection, give proof. Otherwise, say that you are not claiming a connection.

        Especially, can you please clarify the “lego blocks” comment? Were you referring to Rajan there or not? Are you saying he was treated like a lego block or not? Seems like a simple yes/no question.

        Or you could just admit you have backed yourself into a corner here :)


      • In reply to bhagwad

        So you are claiming there is a connection? Just so we are clear. If you are not claiming a connection, let me know.

        Wow…the “connection” comes simply from “people” making “comments”. Not even an accusation from the alleged victim yet! But “connection” is still made on the basis of “comments” from “people”. Wow…that is quite a climbdown from the high standard of evidence you used to require a few months ago, don’t you think :)


      • In reply to SS

        My post has nothing to do with the reasons for Rajan’s exit. What do you think I’m trying to prove that requires “evidence”? Evidence for what?


      • In reply to bhagwad

        Bhagwad, I have been repeatedly asking you a simple question: are you claiming or are you not claiming that there is a connection between Rajan’s exit and your other comments in the post about “treating people like lego blocks”?

        Are you claiming Rajan was treated like a lego block? If so, who was it that treated him that way? If you are not claiming that, just say so.

        These are simple yes/no questions…why dithering so much?


      • In reply to SS

        Umm…I never claimed Rajan was treated like a lego block. Is there any need to answer a question when you can find the answers in my original post itself?


      • In reply to bhagwad

        Fantastic! Finally a straight answer. So just for clarity, the remarks on treating people like lego blocks have absolutely nothing to do with your comments on Rajan’s exit, though the sentences are woven together in the same post? You just decided to write on two completely unrelated topics in the same post, right?

        You can just type “Y” or “N” below. Thanks.


      • In reply to SS

        Rajan’s exit was linked to comments people were making about people being lego blocks. I was commenting on the mentality behind the comments.

        Is there a reason you cannot get these answers by just reading my post?


      • In reply to bhagwad

        Ah…the “mentality” of “people” making “comments, etc.” :) Thanks for attacking the “Indian way of thinking” as well as the “characteristic of Asian countries (and perhaps even Europe)”.

        I have to admit, you get 100/100 my friend for always always addressing individuals instead of making generalizations about groups of people.

        Meanwhile, some of us lesser mortals are not allowed to assume that card carrying members of the Communist Party approve of the actions of the Communist Party. We are not allowed to talk about their Communist “mentality”. We have to find individual testaments from each of them approving of the actions of the Communist party :)


      • In reply to bhagwad

        You speak about the “Indian way of thinking”. That refers to 1.2 billion people.

        You spoke about “characteristic” of Asian countries! That’s literally billions of people!

        Let’s try this :

        In the wake of the JNU controversy, some people are making comments like this:

        “Leftie JNU students are not a threat”.

        Except that some kinds of student organizations ARE a threat. Because they belong to the Communist way of thinking, which generally produces mass murder.

        Good enough? Or is the use of group names automatically delegitimized when a right winger does it? And I am not using names like “Indian” or “Asian” referring to the race a person is born into or the culture he might have been immersed in since birth. I am using the group name “Communist”, which refers to a very conscious choice of political ideology made by adult human beings.


      • In reply to SS

        “Indian way of thinking” according to you implies every single one of those 1.2 billion people? Is that a necessary condition of using that phrase?

        While I can cite lots of examples to show a general “Indian way of thinking”, you have not even given ONE example of a JNU student making a threat. If you claim JNU students are a threat, show me at least one example of a JNU student making an actual threat.

        Just like I have actual examples.

        So tell me – can you show me even one JNU student who has made a threat? Let alone the majority of them? Or are you going to once again apply a lower (non-existent) standard of evidence for your own assertions?


  3. Sir,

    Another great post as usual!

    As a free market economics leaning guy, I do disagree with Raghuram Rajan’s Keynesian economic viewpoint though: “What benefits the individual doesn’t necessarily benefit the system.” However, like you’ve said, he IS indispensable at the moment. Now major investors and global leaders like Singapore based Jim Rogers, Finnish FM Olli Rehn, etc, have expressed displeasure at Modi having let RRR slip, which was primarily Rajya Sabha member Subramanian Swamy’s dirty handiwork. I mean, please look at this comment from an elderly lady:


    And please look at another one of Swamy’s recent comments:


    This is exactly what the Chinese state media reflected about India: “They’re too self-righteous.” And that’s what Modi and his government are all about. No matter what new party Modi floats like you’ve suggested earlier, he’ll still be the same. That’s his mentality. He’s basically an RSS Swayamsevak first and then the PM of India, much like Manmohan Singh was first a puppet of Sonia Gandhi and then the PM of India. However the latter was wiser and handled a much tougher and adverse global economic situation much better than Modi is handling the present, which in my view would’ve been a cakewalk for MMS.



    And why was/is Modi not strong on Swamy for his gutter level skewering of RRR? Because he himself approves of such bullshit. Please read this blog post by the aforementioned lady:


    And this Twitter thread:


    As for Swamy, here’s one cultured gem of a guy Swamy follows:



    Swamy is a diseased insect who has to be crushed and carefully incinerated. Throwing him into the gutter won’t help as it’s his habitat. There he’ll grow and flourish and come back with even more venom.

    Coming to your post, I agree Indians treat people like Lego blocks. This is what caused Islamic invaders to rule this land for 800 years. Indians DON’T learn from their mistakes. Even Islamic societies are getting all self-righteous and far up their posteriors quite rapidly now. And that’s another reason for almost everyone else to loathe Muslims.

    And that’s why America is still great despite all these mediocre times while India is still a hellhole! Those open to learning all the time flourish. With the passage of time, self-righteous people will perish.



    • In reply to Iniyavel

      if Dr. Rajan is indispensable, how come the markets don’t seem to give the slightest damn? It’s been 2 weeks since he announced his departure and investors are yet to take notice. In fact, the market is having a party, but that is due to other reasons. How come investors haven’t yet heard of this great calamity in India due to Dr. Rajan’s departure? Are global investors getting their news by pigeon courier these days? Maybe the pigeons carrying news of Rajan’s departure haven’t reached all corners of the world yet…

      You cherry pick opinions from some investors, but the real opinion of investors is in their money. Which way are investors voting with their cash?

      In fact, if anything, Rajan’s premature decision to leave reflects the worst in the ugly entitled NRI mentality. The government merely appointed a commission to evaluate all candidates for RBI governor, including Rajan. It was Dr. Rajan the NRI who decided that he was too good to be evaluated by Indians and left in advance.

      Asking people to go through a selection process is not an insult. The great Sachin Tendulkar had to be formally selected for every cricket series every 2-3 months. It did not diminish his greatness. In fact, the worst, most backward mentality is when people think they are too great to be judged by anyone else. Even if a Nobel Laureate writes a scientific paper, it goes through peer review before publication. This process does not diminish science or the Nobel Prize.

      But Dr. Rajan wanted it a different way. He wanted to enter through a VIP entrance without any checks, collecting our salaams on the way. He can’t submit to peer review like ordinary mortals such as Sachin Tendulkar or Richard Feynman…


  4. Bhagwad,
    Understanding this post is a bit difficult, because you’ve cleverly done 2 things. You’ve taken 2 or 3 instances and made a philosophical generalization about Indian/Asian race. Now if I oppose the instance, you’ll ask me to look at the bigger point you’re making. And if I argue on the generic point, you’ll shift to the 2 or 3 instances and discuss it.

    Specific instance of Raghuram Rajan:
    We elect the PM, and he is answerable to us during/after 5 years. He needs to do whatever it takes. If Raghuram Rajan isn’t doing the job for him, he’ll have to ask RR to quit. Doesn’t matter if many think RR’s good. By the way, there are good number of economists who think RR hasn’t done quite as well for the country. Lets not trivialize this decision. This is not like the job-profile of a tech-developer. If he’s good, retain him and ignore if he listens to music while working. There is lot more at stake here.

    If everyone of us has an opinion on every one of the decisions of PM, and wants him to respect our ideas, lets give PM some credit of intelligence too. Judge on the results, not his day-to-day decisions. There would be both good and bad. We haven’t seen the replacement start work yet. And its not like Pratibha Patil vs Abdul Kalam comparision…. yet.

    Generic nature of Indian/Asiatic cultures vs American on Individualism.
    This is a slippery slope for any kind of generalization. I believe laws and system define how people act and societies are perceived. India has bad laws and our lawmakers & judiciary do not understand individual freedom or individual rights well. We suck here. And, that shows up in myriad ways. Can’t blame current government alone for that.

    And in this context, kicking out someone when their use is over, is exactly what American corporations do. They do not attach a emotional baggage here. Its not like, ‘Oh! he has been such a wonderful CEO for past 2 years.. let him continue’. If company/board see.. he isn’t doing what is expected, then it’s time to leave. Not because the CEO is a bad guy, but because priorities are different. Company would find another CEO. Apple may have suffered Jobs’ departure, but there are others who have gained by firing non-performing CEOs and some who suffered for not firing their bosses. MBA case-studies are replete with such examples. And, you’re expecting the exact reverse of what you were expecting of an American system to work like.

    A techie’s idiosyncrasies are tolerated precisely because he’s dispensable, but not worth the trouble. A CEO’s job is indispensable, and hence any leeway will not be tolerated.

    There are times when we need to appreciate talent and root for it. There are times when we must play the hardball.


    • In reply to Murali

      But I’m not criticizing the PM here. I’m not even saying that Raghuram Rajan was treated badly! From what I understand, Rajan quit by himself – so the government doesn’t even enter into the discussion here.


      • In reply to bhagwad

        Awesome! See some ordinary mortals were confused by your non-traditional writing style of interweaving unrelated sentences on several unrelated topics inside the same blog post :) They thought just because the sentences are interwoven, they must be related…elementary mistake :)


      • In reply to bhagwad

        I understood your point was Indians/Asians treat individuals as interchangeable and dispensable, and RR being and example of it.

        Replacing CEO’s or of people in charge, is actually an American trait, or rather a trait of societies with high degree of market freedom. India, if at all can be blamed, would be for the opposite, i.e not taking chances, betting on the winning horse, as our laws are more bureaucratic-friendly. There would be more instances and examples of this rather than the opposite. In the same case in US, RR would have been asked to leave much earlier, if indeed it was due to bad-vibes with Government. Then, his completing his term is actually a bad-example for your point.

        Yes, I agree to your general point about Indian corporations treating people as replaceable. I suspect this has more to do with the Job rather than mindset. I have seen companies pay insane amounts for hire the right candidate for a project, but not treat existing employees, who do not bring anything special to the project.

        I see what you’re seeing, but I suspect the reasons we are giving are different. I suspect it is not mindset/culture, but more to do with specifically the job and generally the laws and market.


  5. Bhagwad,
    The verdict is IN.

    The pompously named “Rexit” has been laughed off by the markets. Reality has served the liberal elites a cold glass of shut up juice.

    I invite you to click the following article on Moneycontrol listing all the amazing ways in which things have changed for the better since His Highness Dr. Raghuram Rajan announced he would no longer grace our Reserve Bank with his august presence.


    Markets are at a high, Rupee has strengthened, FII investment pouring in all round.

    I think you owe it to your own conscience to write another post admitting that you got it wrong. Perhaps, you can treat His Highness Dr. Rajan like a lego block after all :) If the Modi government kicked His Highness to the curb, seems like they got it totally right on this one :)


Leave a Comment