Our revolution today - spearheaded by the dramatic rise of the Aam Aadmi Party (AAP) - will, in my view, have an even deeper and longer-lasting impact, because it is much more broad-based and, indeed, part of a global wave for change. Again, the currently most popular political framework - democratic capitalism - is crumbling in most places. Karl Marx believed that the fundamental flaw with democratic capitalism was that it would result in unacceptably high disparities between the few - think the top one per cent and Occupy Wall Street - and the rest, which would ultimately lead to its collapse, or, certainly, stagnation. The Fed's continuing efforts to mimic Cirque du Soleil in monetary policy are evidence of this.
To my mind, the only place where a version of democratic capitalism is successfully practised is Germany (and associated Northern European countries), where, for decades now, key decision making has been shared between government, business and labour. The AAP, while conceptually close to this, needs to study and learn from the German example.
Indeed, the AAP needs to tune its model to create a more balanced mix of joint strategic decision making a la Germany and crowd-sourcing governance a la the Swiss. The trick, of course, is managing scale, which calls for technology a la the Unique Identification Authority of India, or UIDAI.
The AAP also needs to open its mind to different ideologies. Nobody knows - indeed, has ever known - what the right model is, and it is important - and democratic - to bring in the widest possible range of political ideologies, let them batter against each other before coming up with the way forward. I come back to Germany, where the by-now enlightened business sector is not simply looking for the higher margin and by-now enlightened labour is not simply looking for the highest wages.
Most of all, the AAP needs to open its heart much, much more or it risks losing some of the great energy that is hugely attracted to its morality.
Irrespective, the revolution is joined, the most exciting result of which is that, as I just said, nobody knows where it is going or what its next nodal point will be. All this, as I wrote recently, guarantees volatility in our financial markets.
The really good news, though, is that the revolution has smashed the "nothing's-ever-going-to-happen" mindset that had discoloured much of Indian business for the past few years. And while "spring-in-its- step" would be a patent exaggeration, the truth is that business is back in business. Thus, the volatility will be tinged with a mild upward bias - I'd forecast that the Sensex will move in a range of 18,000 to 27,000 over the next three years.
On the rupee, the Reserve Bank of India's (RBI's) move to permit companies to again book and cancel hedges against their exposures is a loud signal that it is much more comfortable with the prospects for foreign exchange market stability - perhaps the AAP effect is partly in play here as well.
Again, the RBI may feel, as I do, that the US Fed has managed its quasi-exit from quantitative easing very well. There's been such a long period of talking about it that it is likely that as tapering continues, it won't have too dramatic an impact on US bond yields or, for that matter, the dollar, both of which suggest that the likelihood of sudden, dramatic pressure on the rupee is relatively low.
My concern is more on the current account deficit, since, as the last US employment numbers suggest, the US recovery is - and, I believe, will continue to be - anaemic at best. This means export growth, which disappointed again last month, will need a sub-60 rupee for some more time yet - which may explain the RBI's move to again permit activities that it had earlier felt were putting the rupee under pressure. Hopefully, this will also convince the government to lift the import duties on gold.
Be all that as it may, each of us - and that includes you - needs to use the opportunity created by the AAP to get more involved, to become more civic-minded, to become a true citizen of India.
Aa jaon maidan mein!
jamal@mecklai.com