Harim Peiris

Political and Reconciliation perspectives from Sri Lanka

  • June 2022
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Ranil’s government’s failure was inevitable – elections the only way forward

Posted by harimpeiris on June 27, 2022

By Harim Peiris

(Published in The Island & Groundviews (as “Elections Are the Only Way Forward”) on the 24th June 2022)

The young Sri Lankan cricket team has done the impossible and in the past couple of weeks, beaten the powerful Aussie cricket team several times, in the shorter formats of the game, giving Sri Lankans some much needed respite and cheer. The games have been played to packed crowds, notwithstanding lingering covid spread threats with TV viewership also reportedly high, demonstrating that people understandably seek some avenue of cheer from the misery which Rajapakse rule has plunged our nation to.

In contrast, the Gotabaya Rajapakse / Ranil Wickremasinghe administration has only managed to guide our ravaged economy to a near crash landing and an effective standstill. Government servants are asked to stay at home, school children are again online due to effectively non-existent fuel supplies in the country. During the five weeks of Ranil’s government, its seeming only role has been in coordinating the scare foreign aid, almost exclusively from India and not in effecting many of the significant and required reform measures, economic or political. It sought to argue that political reforms are not required and only emergency management of the economic crisis was needed. There was a basic game plan, backed by a politically naïve business elite, which was to get the white knight IMF in as soon as possible and until then use political contacts to get bridging finance to keep the economy moving. 

Well, this plan has not worked, for reasons which the young people of Sri Lanka correctly understand, but our political and business elites continue to want to ignore. It is that we have an economic crisis on our hands, precisely because of and due to our politics. After all the coming calamity was not sudden but forecast and warned about, most famously by former Finance Minister late Mangala Samaraweera. Even more recently as the proverbial writing was on the wall, using foreign reserves to defend the rupee at a ridiculous over valuation, printing money, not going to the IMF and not commencing early negotiations with our international creditors was the bombastic claim to fame of the lunatic leadership of our politicized Central Bank. It was relatively recently that we turned down a half billion-dollar grant (not loan) from the American Millennium Challenge Corporation (MCC) and opposed another half billion in Indian investment into the East Container Terminal (ECT). A billion dollars we can desperately use now. That is our politics, which drive our economics. The majoritarian ethno-religious nationalism which won big in 2019, drove our politics and drove us to our knees. We were advised by those who should know better to get a Hitler like administration (as opposed to a Mandela) and we voted for one, which has now resulted in our own defeat at Stalingrad, leading to the eventual destruction and fall of Berlin. 

The IMF white knight

There is great hope in the business community because of the naïve belief in the IMF as a white knight, will bail us out of trouble. That is because the business community does not fully appreciate the political constraints to the implementation of the required economic reforms. Reforms which are more painful now, because the economy has crashed, rather than when we were healthy. Any bailout / bridging finance by the IMF and / or bi-lateral lenders require our debt to be sustainable. In other words, that we can come out of bankruptcy and start honoring our obligations, including the bridging finance we are seeking now.

We not only need to raise revenue, but we also need to rationalize Government expenditure. We cannot as a nation afford to spend more on peace time defense, than we do on both education and health combined. But that is Rajapakse politics. We cannot afford badly targeted generally subsidies, though we can and must have a social safety net which takes care of those most vulnerable amongst us, which number is growing daily. We need to privatize our loss-making state-owned enterprises. Rajapakse politics was to re-nationalize Sri Lankan Airlines and kick out Emirates Airlines. Our politics have brought our economic collapse. We need to remove the anti-export bias in our economy and regulatory framework and the failed import substitution of the 1970’s towards which the Viyath maga & Eliya crowd at Shangri-La was dragging us. That would diminish the role of local oligarchs and replace rent seeking wheeler-dealing with internationally competitive businesses following best practices, as drivers of economic growth.

Elections the only solution

Ranil’s interim government has not been able to elect a woman deputy speaker, pass the 21st Amendment or most likely not even pass a genuinely reforms oriented interim budget. It has on the contrary given a major reprieve to the Rajapakses’, taken the steam out of the “Aragalaya” and sought to solidify the status quo. We need the new, not the status quo ante. The reason is because Mr. Wickramasinghe is now Prime Minister of an essentially SLPP Government, of which he is nominally the vice-captain, but does not lead.  The Rajapakses still call the shots. An internal family reshuffle and image makeover, denying any course correction does not provide the reforms which make our debt sustainable, which is what the IMF and all our creditors require. We would not be able to go there and do that with the leadership which brought us to this ruin.

Self-realization of failure dawns slowly, if at all for some people. The Rajapakse Administration and the SLPP are in denial mode and a fractious opposition has not helped the nation by easing up the pressure for the Rajapakses’ to go. The Opposition should challenge the interim government to present to parliament a Cabinet approved minimum common program, which it has not unveiled and can garner bi-partisan support from the Opposition or move a motion to dissolve parliament and go for a general election, because Sri Lanka requires a government with political legitimacy and a mandate to deal with the mess created by those mandated in 2019, to create “vistas of prosperity” who instead bankrupted us. As a recent Verite Research report pointed out, we would spend less on an election than we are on a new defense ministry headquarters or barely more than just the loan, interest component only, for the Kotelawala Defense University’s teaching hospital.

Sri Lankans are inordinately proud of their state, and we have much we can be proud of. Regular elections have been a big social safety valve of releasing pent up political frustrations, empowering the people and they reinforce the legitimacy of governments. We can and must go for parliamentary elections, sooner rather than later.

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Why both political and economic reforms must move in parallel for a turn around 

Posted by harimpeiris on June 9, 2022

By Harim Peiris

(Published in The Island & Groundviews (as “Need for Parallel Political and Economic Reforms”) on the 08th June 2022)

There is a fallacy being promoted by the reconstituted Rajapakse regime, that political reforms such as the proposed 21st Amendment are not really necessary or at least have already occurred through the change of Prime Minister and a reconstitution of the regime and the need of the hour is urgent measures to resuscitate the economy, because people are suffering economic hardship and their misery must be alleviated. Undoubtedly the people are suffering, and their misery must be alleviated, but political reforms are required for the required economic reforms. Both political and economic reforms need to move in tandem and in fact, political reforms are a necessary precursor for sustainable economic reforms.

A regime reconstitution – Ranil as Rajapakse nominee 

The Gotabaya Rajapakse Administration destroyed the Sri Lankan economy. With a combination of the fool hardiness of the naïve, the arrogance of absolute political power and corruption through unaccountability, they delivered not the vistas of prosperity and splendor they promised and was mandated to do, but instead they destroyed of the national economy. Which was resilient even in the face of a thirty-year civil war. It is ironic that the leaders who claimed credit for ending our war, managed to bring about a national destruction which the war never could. 

After the crash landing and the resultant political outcry by the populace, the initial response of the Rajapakse’s was to fire (request the resignation) of their entire cabinet of ministers who obliged. When that did not assuage public anger, the response was a combination of trying to shoot protesters (Rambukkana) and / or beat up the protesters (GotaGoGama) and then reconstituting the regime, with a UNP prime minister, with a full parliamentary group of himself. The rationale for this move was that the Government was resigning, and someone must take over the reins. What now exists in Government, is Mahinda Rajapakse giving up the trappings of a ceremonial PM, a single seat MP as prime minister, dependent on the core SLPP parliamentary group for the government’s survival, Basil Rajapakse reverting to his customary role of SLPP party boss calling the shots, sans ministerial office and President Gotabaya Rajapakse continuing with full executive powers. 

The Samagi Jana Balawegaya (SJB) of Opposition Leader Sajith Premadasa was correct to have adopted the principled position as well as align with the sentiment of the vast majority of the Sri Lankan public, who have been seeking to have the president take responsibility for the economic collapse he engineered and to abdicate power. The Opposition Leader has correctly stated that Sri Lanka had an executive president and a ceremonial prime minister and either the executive president must go and / or his powers transferred to the prime minister and parliament for a prime minister led administration to work. (It was Sajith’s father late President Ranasinghe Premadasa who was famously, quoted as stating that under the 1978 constitution, the PM does not even have a peon’s powers). It is in the light of that reality as well as the constitutional reform discourse since the presidency of Chandrika Bandaranaike Kumaratunga, that the SJB, through its general secretary, Ranjith Madduma Bandara, tabled a proposed 21st Amendment to the constitution, which inter alia, changes the executive presidency to a ceremonial one. 

The proposed 21st Amendment is a significant compromise from the reform proposals of the SJB and is instead, a reversal to the status quo ante of the pre 20th Amendment period, albeit a 19th amendment minus situation. With some degree of consensus reached on many issues of the 21st Amendment, it is now the (still) ruling SLPP which is seeking to renege on the 21st Amendment and keep Ranil as a puppet on a string.

Economic reforms come through policy changes which only which only a government with public political legitimacy can deliver. But the even the truncated 21st Amendment must be passed. 

The economic reforms

Sri Lankan faces a catastrophe which even 30 years of civil law never perpetuated on a hapless general public. It is paradoxical that the political leaders who are credited with ending our war have been clearly responsible for a national destruction, which the war was never able to bring about. 

The response of PM Wickremasinghe’s economic team has been to reverse the lunacy of the Viyath Maga, Eliya and SLPP policy framework, of slashing taxes, defending an artificially low exchange rate with all available foreign reserves, printing money to fund a fiscal deficit, being utterly corrupt, tone deaf to expert advice and banning fertilizer. Now, Interest rates have been raised, the exchange rate has been floated somewhat and the disastrous tax cuts of 2020 are sought to be reversed. Again, a reversal to the status quo ante of 2020. However, what was sufficient before the economic collapse will not suffice to pull us out of the same. That would require a restructure of loss-making state monopolies and other structural reforms of the Sri Lankan economy, especially measures to ensure that our national debt burden is sustainable. Reforms which require public and political legitimacy, which the Rajapakses have totally lost. 

The IMF and the World Bank have made clear, that no new funding facilities can be made available until Sri Lanka demonstrates a policy program which basically makes our national debt, especially its foreign currency component sustainable, i.e., repayable over time. The global financial system requires that sovereign nations honor their debts. Just like a national financial system require it domestically. 

Contrary to popular belief, the reversal of the 2020-22 policies have made no material impact on our national finances and we only have fuel to provide mobility and ease our foreign currency situation because of Indians supply us with fuel on credit. Foreign policy wise, India is very kindly doing for Sri Lanka, what in years past, Germany tried to do for a while for Greece, which is bail us out of trouble. With over six hundred billion dollars in foreign reserves, it has decided that about one or two billion could be used to fill the space vacated by the Chinese, who seeing the writing on the wall have made their cheque book scarce. The middle kingdom is quite hardnosed about their finances, just check the rates at which they lent money for the Rajapakse white elephant projects.

Ranil’s interim government has perhaps done as much as it could, which is clearly not enough. A clear timeline for early elections, perhaps sometime early next year, will be required for the real reforms required for rebuilding our devastated nation. 

(The writer served as Advisor, Ministry of Foreign Affairs from 2016-17)

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The inverted October coup in May 2022

Posted by harimpeiris on May 24, 2022

By Harim Peiris

(Published in The Island & Groundviews on 14th May 2022)

The president of Sri Lanka, sensing serious frustration by the electorate at non-performance, sacks his prime minister and swears in another prime minister. The former PM was reinstated but even lost his own parliamentary seat at the subsequent elections, one year on. No, not President Gotabaya but President Maithripala Sirisena, who back in October 2018 sacked Ranil as Prime Minister and brought in Mahinda for an infamous 52 day “coup administration” ended by the superior Courts, which upheld the several no confidence motions passed by the then parliament.

Now in May 2022, the scenario is now inverted. As President Gotabaya, successfully demanded the resignation of his own brother and installed Ranil Wickremasinghe again as Prime Minister, for a record sixth term. In a multi-polar Sri Lankan polity of 2015-2018, that was Sirisena, Ranil and Mahinda, the calculation was that any two getting together could checkmate the other. The current calculation is that President Gotabaya, with just a part of the Rajapakse clan (Basil is backing the president) and Ranil, with very little support in the country, can hold at bay Sajith Premadasa and his SJB opposition front. Here are the reasons why Ranil’s own tenure as PM will likely be quite “interim” and his exit will also signal the end of the Rajapakse Administration, which has completely lost its legitimacy in the eyes of the public. 

The deal that Ranil cut

The recent farcical re-election of Ranjith Siyambalapitiya in Parliament as deputy speaker, demonstrated that the Rajapakse’s ruling SLPP though discredited within the country, clearly held its numbers in the House. Somewhat reduced, but still a majority. This then presented the opportunity for both the SLPP and Ranil. The SLPP to kick out its non-executive ceremonial prime minister while retaining all executive authority through the 20th Amendment strengthened presidency and create the window dressing of an ostensibly opposition or independent MP as Prime Minister. Ranil wanted a last hurrah, before a retirement which he is determined will never come and was sworn in yesterday as PM, his United National Party (UNP) at a full conference of one MP (himself), backed by the government group, less most probably Maithripala Sirisena’s SLFP, which must be seething at not having the former President as the new PM. 

The political instability would go on

Sri Lanka’s political crisis arises out of the near collapse of its economy. Ironically from a President elected on a mandate of promising to provide “vistas of prosperity and splendor”. A government that so totally fails at the provision of basic services and even maintaining the existing economic well-being of the populace, loses its political legitimacy. President Gotabaya Rajapakse has lost all legitimacy in the country. His refusal to accept responsibility for a crisis resulting from his administration’s tax slashing, money printing and fertilizer banning is unconscionable and actually delays remedial measures and policy reforms. Several senior members of the clergy, have already signaled their opposition to Ranil as PM. He is not a figure around whom people will coalesce, so it is doubtful if his cabinet will be inclusive and multi-party. The real problem for Ranil though is he is being seen as prop, albeit a very weak one, for a widely discredited and now even reviled leader.

Moreover, for the Rajapakse clan, being united is critical to capturing or holding on to state power. The 2019 election victory was exactly because the several brothers were able to iron out their differences, present a united front and win big. For the same reason, the divisions and discord within the famous political family is now on full display. Former Prime Minister Mahinda Rajapakse, his sons and their backers believe with some justification, that Mahinda, shorn of any executive power once he ceased to be Finance Minister, in favor of younger sibling Basil, has been unfairly held responsible and thrown to the wolves as it were, to assuage public anger caused by the president’s own policy blunders. After all the “voodoo economics” of tax slash, money print and ban chemical fertilizer all came from the President’s “Viyath maga” and “Eliya” groups, ironically a path to destruction and darkness, the anti-thesis of their names.

The economic mess

The immediate socio-economic challenge is keeping basic public services and key utilities including fuel and electricity provided at least at the reduced rates as of present, instead of further cuts and reductions of supply. This also applies to LP gas, rice, other food staples including milk powder and medical supplies. Getting out of Sri Lanka’s economic mess requires the kind of fiscal overall that will require significant and painful reforms, which only a government elected and with a popular mandate can implement. If the ruling SLPP does not rescind the 20th amendment, then the same should be on the SJB manifesto and implemented within the first 100 days. If the president will not resign, the office must be made non-executive, he can serve out his term as a ceremonial president. 

Meantime in the days ahead, parliament is due to vote on a motion of no confidence on the president and the new Prime Minister would also be required to demonstrate his majority or support in the House, through the passage of a new budget. Earlier elites used to bristle when Sri Lanka was called a fragile state, now the voices on the street, in the aragalaya at Galle Face and elsewhere, is saying much the same thing. An election will clear the decks and bring in both the political legitimacy, stability and policy reforms that are sorely needed. Replacing Mahinda with Ranil will not. 

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The Need Of The Hour: A Nelson Mandela 

Posted by harimpeiris on May 24, 2022

By Harim Peiris

(Published in Groundviews on 11th May 2022)

Sri Lanka’s economic meltdown requires urgent remedial measures and the political impasse created by a President and his administration, which both refuses to either take responsibility or credibly effect corrective policy measures, has placed Sri Lanka in the position of a terminally sick patient who isn’t being taken to hospital for the urgently required life-saving care.

Why President Gotabaya must go

Sri Lanka’s system of governance is not just an executive presidential system, we are the closest to an absolute presidency, like an absolute monarch, found anywhere in the world and especially after the SLPP brought in its signature 20th Amendment to the constitution, which further centralized power in the presidency. Sri Lanka under its 1978 constitution, as amended by the 20th Amendment has an executive presidency and a ceremonial prime minister, the very opposite of what we had from 1948-1978. Therefore, for any meaningful change of government power, it is the president who has to change. It is ironic that a president whose election pledge was “vistas of prosperity and splendor” has presided over the total destruction of Sri Lanka’s economy brought about by a combination of voodoo economics and the absolute refusal to consult, compromise and course correct. Even an A/L commerce student would be able to forecast that the combination of fiscal slippage and loose money, carried out in an absolutely unrestrained manner would have catastrophic consequences. The president needs to take responsibility for the havoc that has been wrought by his administration on Sri Lanka and transition himself out of power.

The fiasco of the Prime Minister’s resignation

Sri Lanka had a farcical resignation of members of the Cabinet as demonstrated by the fiasco of the resignation, re-appointment and re-resignation (the word created by our own recent experience) of Parliament’s deputy speaker. It is clear now that there is a deep division between the President and the Prime Minister, the former trying to put the responsibility for the economic meltdown on the ceremonial post of the Prime Minister, having failed to do so by getting the Cabinet to resign. It is equally clear, that the Prime Minister, is equally determined not to be the scape goat and fall guy for a situation, which he clearly believes was not solely of his making. The reality though is that the Sri Lankan public holds the Rajapakse’s as a ruling family collectively responsible for the sorry situation we find ourselves in today and is requiring a new future without them.

The other phenomena arising from the “aragalaya” is the discarding of the ideology of the SLPP, namely that of majoritarian ethno-religious nationalism. Just like the government of Madam Sirimavo Bandaranaike so discredited socialism that we are now socialist only in name, the downfall of the Rajapakses is also discrediting their ideology. The young people on the streets, want a new Sri Lanka to be inclusive, pluralistic and tolerant of diversity.

Violating the sovereignty of the people

The president some weeks ago, declared a state of emergency, with possibly the intent to prevent mass anti-government protests, which was resoundingly rejected by the people, who got on the streets anyway. The likelihood of the emergency being defeated in parliament saw the president withdrawing the measure two days later. Now, possibly egged on by hardliners running the ministry of defense, the president has again declared a state of emergency, even as the legal challenge to the prior declaration is still pending before the Supreme Court. As the Bar Association of Sri Lanka and the resident diplomatic community noted in statements and social media, there is no justification at all for a state of emergency and using emergency regulations to stifle dissent is not what the emergency is designed for. We have a political and economic problem, not a military and security one. The LTTE and even the JVP insurrection posed an armed challenge to the State, the “aragalaya” poses a political challenge to the government. The people of Sri Lanka are sovereign and unleashing state violence on the people, engaged voicing their dissent is a violation of the sovereignty of the people. It will seriously and permanently diminish the military in the eyes of the citizenry.

Unleashing state security on the organized but non-partisan protest movement and seeking a sequel to the Rathupaswala shooting by the Army of unarmed civilians is a very unwise decision which the generals in the Defense ministry should seriously reconsider. The consequences are likely to be dire. India is bailing out Sri Lanka financially, much more than China, which is refusing to restructure their exorbitantly priced debt. The Indians are unlikely to want an escalation of the instability caused by state violence. The Sri Lankan Army still holds on to lucrative UN peacekeeping roles in Mali and elsewhere, even as there are growing calls for their use to be re-examined. A bloody crackdown on civilian protests will be the final nail in the coffin of Sri Lanka’s “peace keeping” operations. Sri Lanka’s Army commander is already a “sanctioned individual” under US law. It is not in the interests of Sri Lanka’s military to keep having a long list of officers as “sanctioned individuals”. Anything the military does now, will be in the center of our capital city, in the full glare of global publicity and recorded on countless smart phone videos.

Some in Sri Lanka, who should have known better wanted a Hitler type leader. It may be instructive to reflect on how that experience resulted in the destruction of Germany and the last days of the Berlin bunker. What we really need now is a Mandela, a unifier who brings us together, makes the difficult choices and navigates the uncharted waters ahead, as we seek the way back from the self-destruction, which was thrust upon us as a nation.

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Divided govt. loses its two-thirds majority

Posted by harimpeiris on March 11, 2022

By Harim Peiris

(Published in the Island & Groundviews on 10th March 2022)

Last week witnessed the coming to the fore of the deep divisions within the governing alliance as President Gotabaya Rajapaksa sacked two Cabinet Ministers, Wimal Weerawansa and Udaya Gammanpilla, and laid bare the internal disquiet and dissent within the Government, which had been brewing for quite a while. Concurrently, the 11other minor political party allies of the government also essentially parted ways, Minister Vasudeva Nanayakkara stating that he will neither attend cabinet meetings nor go to his ministry and the other parties also vowing that their common political journey with the Rajapaksa and the SLPP is all but over. The government’s intraparty relationships have ruptured and this brief analysis will examine some of the important ensuing political ramifications.

1. Political economy at stake

Watching the current situation unfold from the spectator stands, as it were, one gets a strange sense of deja vu. A populist president, elected with an overwhelming mandate so mismanages the economy that even his own constituency of the majority ethnoreligious community comes to accept that their interests are just not served through the combination of poor governance, weak economic management, but very large doses of ethnonationalism, disguised as patriotism. The classic formulae for regime change are a divided government and a united opposition. When the government splits, the opposition just sniffing political blood makes the extra effort to unite. No, not just in the present but a very similar scenario existed in 2014. Earlier, the departure of the then JHU, from the administration of Mahinda Rajapaksa was the first very public rupture in it. In the present administration, the departure of Wimal Weerawansa and Udaya Gammanpilla, signals the same rupture.

2. Rajapaksas rid themselves of majoritarian nationalist spokesmen

Incidentally, during both Rajapaksa administrations, the break came from its right-wing, as Sinhala nationalists, who explored the non-existent political space of being more ethno-nationalist than the ruling Rajapaksas, were forced to make their exit. On both occasions, the exit preceded or coincided with the rise of other non-party political organisations pushing an anti-minority, especially anti-Muslim agenda. In 2011/12, the effort was on the part of the civil society, NGO space and of course in the current dispensation the same personality heading an innoxiously named presidential task force is more clearly positioned within the state. But what this rupture does is quite politically significant. The near-monopoly of the Sinhala nationalist vote and uniting it for a political victory, as President Gotabaya correctly claimed during his presidential victory speech at Anuradhapura has, in less than three years, come apart. Mainstream media claim that the President, Prime Minister and Finance Minister were not unanimous in their decision to sack the duo. While the Rajapakses and the SLPP certainly command more support than Wimal’s NFF and Udaya’s PHU, the duo will cause more political damage as regime dissidents than any assistance they gave as regime supporters. Fighting with your allies is political suicide. Look at Maithripala Sirisena and Ranil Wickremesinghe. Their infighting and disunity ended their administration and their political careers at the apex.

3. Divided government loses supermajority and causes are economic

The rupture within the Government has also effectively eliminated the Government’s two-thirds majority in Parliament. The number of minority MPs it can buy over are now limited, having effectively emptied the shelves, or rather the benches, right after the general elections, so that option does not compensate for breaking with its allies. Various routine, non-controversial bills may pass with large majorities, but the SLPP administration does not have the political clout or ability to push through its will.

A recent Verite Research poll put the government’s approval rating at about 10%. An entirely believable number, given the complete collapse of public services brought on by purely ruinous policies. Very similar, in fact, to the SLFP’s economic mismanagement of 1970-77, but this is worse and the people’s expectations and aspirations are higher, so the political price to pay and the vengeance of the electorate at the polls will be severe. Governments don’t lose public support over a fuel shortage but bring about a continuous combination of gas, milk powder, diesel, raw materials and foreign exchange shortages and five-to-seven-hours-a-day power cuts, combined with soaring inflation, rising unemployment, declining agricultural yields and collapsing rural incomes due to the government’s fertiliser fiasco, and the SLPP will experience at the polls, what the UNP did in 2020, its effective elimination.

This brings us to the relatively new alternative government of Opposition Leader Sajith Premadasa and his Samagi Jana Balawegaya (SJB). The SJB has not been quite as inactive as is made out to be, by the same media which downplayed the government’s long-running divisions, till it exploded. The SJB has been doing a series of pocket meeting type gatherings within COVID-19 prevention guidelines, perhaps prompting the Governing party’s Anuradhapura rally and Sajith has been drawing increasing crowds. A recent political cartoon in a leading daily broadsheet was quite telling, it showed a picture of a sinking ship and rats jumping ship, with the faces of the eleven leaders of the political parties, which broke with the Government, superimposed on the rats. The proverbial rats deserting the sinking ship. The issue though is that the ship is sinking. It is necessary to ensure that the country doesn’t go down with them.

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