Features
The preface of Raj Rajaratnam’s book: Why I fought the good fight
In October 2009 I was arrested and charged with insider trading. I chose to fight the charges against me because I was innocent.
The prosecutors alleged that 0.01% of my trades between 2005 and 2009 were illegal.
I understood that in the US there is a 97% conviction rate (similar to China and Russia) and a punitive trial penalty for those who dare to go to trial. Empirical studies have shown that the trial penalty is just about double that handed to those who plead guilty. If a defendant agrees to become a cooperating witness, helping the government with testimony — irrespective of the truth — to convict another defendant, the co-operating witness gets a much-reduced sentence and in many cases just parole.
I understood the stakes. I chose to go to trial. Why? It’s a question I’ve since been asked hundreds of times. Why. Why jeopardize everything. Because to my core I believed I would get a fair hearing. And with a fair hearing and a rational exposition of the facts, the truth would have prevailed. Until my arrest I had the highest regard for the Department of Justice (DOJ) and the Federal Bureau of Investigation (FBI). I believed that most Americans felt that way in 2009. Since then, of course, the American public has become jaded about the sanctity of these institutions with multiple examples of overreach and excess.
Certain DOJ and FBI sections operate, each attempting to further its own agenda without regard for Constitutional checks and balances. The terms “fake news,” the “Dark State” are now bandied about with almost wild abandon, humor, and satire. The public now assumes the existence of “fake news” alongside “authentic” news with little effort towards journalistic integrity. During the time of my arrest and trial, information from the media, DOJ, and FBI was absorbed as unquestioned “Trust,” although some would argue that the dark state has existed for many years. While I still believe that the vast majority of those who work for the DOJ and the FBI are people of integrity, this book is an attempt to shed light on the corrupt few who act with impunity and destroy lives and families to further their career ambitions.
From the moment of my arrest, the narrative of my story was recast with a precise agenda, shaped to direct public attention away from the stark horror of the 2007-2008 financial crisis while promoting media idolatry of the publicity hungry and ambitious rookie US Attorney, Preet Bharara, who became a demi-God, the “Sheriff of Wall Street” riding into battle against myself, relentlessly personified as evil incarnate on the front pages of major newspapers around the world. Wanton disregard for the law, recognized by the judge at my trial, allowed a corrupt element within the FBI, Agent Kang, to falsify documents leading to my arrest and falsify testimony leading to my conviction.
I faced prosecutorial misconduct at its finest. The overzealous media, feasting on a human story they could sell every day, also profoundly prejudiced any hope of gathering an impartial jury by the time of the trial. These three institutions, ostensibly guardians of the public interest, charged with impartiality and integrity, bore down in a concerted campaign to make me the face of the financial crisis. My arrest and subsequent trial, a two-year process, deflected attention from a glaring fact: Not one major banker was held accountable for the 2008 global meltdown. No arrests. No searing prosecution. No jail time.
In the midst of a financial crisis which brought a multi-trillion-dollar world economy to its knees, these three institutions, independently and collectively, targeted a tiny slice of the US financial industry, hedge funds; honed in on a single hedge fund, Galleon; isolated only me, its CEO, who had recently become one of the few immigrants on Wall Street to be identified as a billionaire; and built a fabulous and intricate tale of “sex, drugs, and rock and roll” to entertain the public and build their own reputations. Their two-year reality series was successful beyond measure.
Preet Bharara, the then-US attorney for the Southern District of New York, used my prosecution to launch an unprecedented press campaign to promote himself. Bharara ran roughshod over the truth, standard Department of Justice protocols, and the office’s own dignity in his extraordinary zeal to convict me. Time Magazine put Bharara on its cover, their headline proclaiming “this man is busting Wall-Street.” It was Preet’s finest moment. Bharara did not touch the real perpetrators of the 2008 financial crisis – Wall Street’s top bankers. In a rare moment of public acknowledgement, both Preet and the influential New York Magazine observed in 2014 that Bharara was almost sheepish about the insider cases — “they made our careers, but they (didn’t) change the world.”
Bharara’s impotent and poisoned approach to the non-prosecution of criminal activity on Wall Street — ranging from the mortgage bankers who precipitated the financial crisis (Goldman Sachs, Lehman Brothers), the money-laundering of drug cartels (HSBC), and the encouraging of tax evasion by US citizens (UBS, CSFB) — would become the defining legacy of his tenure. Each of these firms settled civil charges by paying billions of dollars in fines using shareholder money, but no single person was criminally charged or individually fined. Every one of the insider trader prosecutions was criminal. The towering hypocrisy remains startling.
The prosecution under Bharara’s watch advanced a theory of trading to prosecute me and several others which the second circuit appeals court subsequently overruled, criticizing it for “doctrine novelty.” Soon after my trial in May 2011, the then-SEC commissioner Mary Shapiro gloated that “the beauty of insider trading laws is the flexibility in interpreting them.” The lead prosecutor in my case, Jonathan Streeter said in December 2012, “Insider Trading cases are confusing to investment professionals.” He went on to add, “There is incredible confusion on what is illegal and it’s a real problem. The law is very complicated and the lines are a bit murky.” A US Attorney, the prosecution in my trial, and the head of the SEC, all acknowledged their reservations about a “murky” set of laws but had no “murky” reservations using them liberally in my case and at my trial.
The FBI agent overseeing my case Special Agent BJ Kang lied on his sworn affidavit to obtain wiretap authorization of my phone. Recognizing there had been government misconduct, Judge Richard Holwell who presided over my trial case, issued a searing criticism of the wiretap application used by Agent Kang, reprimanding him for “reckless disregard for the truth with respect to both probable cause and necessity.” The Judge went on to add that “false and misleading statements and omissions pervaded the affidavit (submitted by Special Agent Kang) so extensively that it was impossible for the authorizing judge to have the constitutionally required determination for the issuance of the wiretap…rather than provide a full and complete statement as required by the law, the wiretap affidavit made full and complete omissions and included literally false information.”
Kang did not stop at blowing through truth on paper. He menaced and threatened my family and employees with prosecution, frightened away crucial defense witnesses, and routinely leaked false information to the media churning up an unabated feeding frenzy that shredded me in the court of public opinion. Kang took his cues from the playbook of the publicly reviled former FBI director, J. Edgar Hoover. I was tried, convicted, and sentenced in the press even before I fully understood the charges against me. The atmosphere was so toxic that my lead counsel, veteran defense lawyer John Dowd said “the prejudicial publicity orchestrated by the USA was so palpable in the courtroom…It was the most toxic atmosphere of any case I ever tried.”
My defense team led by John Dowd, along with expert testimony from a former SEC legal counsel, repeatedly highlighted that all the information discussed in the wiretaps was already in the public domain. Every bit of information was in the public domain. It did not matter. No amount of truth could overcome the false testimony trained into the co-operating witnesses by Streeter, his team of prosecutors, and Bharara, who sat on the sidelines, waiting in eager anticipation for any opportunity for a press conference. Each of the cooperating witnesses had committed his own set of crimes, unrelated to Galleon. Yet each chose to testify against me as an opportunity to reduce their probable sentences. That they were perjuring themselves was irrelevant; the government coerced them into an immediate mandate to take me down. Even the government’s star witness, Anil Kumar, offered damning testimony under oath in my case only to recant the very same sworn testimony three years later during the trial of my brother. My brother was subsequently acquitted as a result of the revised and opposite version of Anil Kumar’s testimony. A few newspapers picked up on this gross disparity, but that was it. The fact of perjury had no consequence. The cycle was vicious. “Innocent until proven guilty,” the cornerstone philosophy of the American judicial system was proving to be a farce.
I was convicted by a jury, sentenced to 11 years in jail, and paid fines of over $150 million. The irony is that even in setting the fines, the prosecutors working in tandem with the media kept up the unceasing drumbeat of punishment for the financial crisis. Never mind that I did not personally make any money from the alleged trades. And never mind that not one single investor sued me. Galleon went through an orderly process of closing down the firm and returned all the funds with a gain of 22%. Not a single investor lost money. Most important to me, personally, was that not one single investor sued me.
In July 2019, I was released after serving 7.5 years of my 11-year sentence under the First Step Act.
I wrote this book entirely in prison and by hand. I began by writing about an hour a day. Soon that increased to two hours. Then three. I am choosing to publish the book for two specific reasons: First, I want my peers, professionals who understand the nuances of managing money, to hear the facts of my case. I want them to judge me. It is my assertion that I was entrapped, framed, unlawfully wiretapped, surveilled, and then made to endure a brutal and very public media lynching.
Secondly and more importantly, I want to begin a public discussion by creating awareness of how certain corrupt prosecutors and FBI agents are allowed to get away with criminal behavior. There are no checks and balances in our Justice system. Recently there has been a lot of discussion as to whether the President should be above the law. The President is so closely scrutinized that doing anything against the law would ring alarms bells the world over. Instead, my assertion is that the focus should be on the corruption within the American judicial system, on a handful of corrupt US attorneys who live their lives exempt from the law by which they control the lives of others and the rest of the country. In this book I will show how ambitious prosecutors actively take advantage of murky laws and coerce testimony from government witnesses to obtain wrongful convictions. Winning at all costs, regardless of the truth appears at every level to be an operative mantra. I realize there is only one book I can write to set the record straight. This is it.
My story is also about greed. In all its forms, greed boils down to avarice, hunger, power, money, ambition. All of these are readily available and identifiable in the financial industry, by definition. In fact, I would say that in the financial industry, greed is effectively a cliché with fear being on the flip side of a pair trade. Fear and greed are easy to communicate, and the media hones in on these aspects of Wall Street. But what I would like to do in this book is to hone in on the excess and greed in the judicial system. Ambition in the judicial system also translates to power and money, a far more insidious and dangerous consequence to society because it goes unchecked. After I was convicted, the press had a field day speculating whether the “new sheriff” of Wall Street, Preet Bharara, was actually in line to succeed Eric Holder as the next US Attorney General when Holder stepped down. While Bharara was at first coy about his intentions, he eventually made clear his goal to secure the job based on his work prosecuting Wall Street. He may have wanted the job but did not get it.
The same ambitions were true for the three government prosecutors in my case – all three left government shortly after closing out my case for higher paying jobs as partners in leading law firms. They and their new employers spent considerable effort drumming up business on the heels of the skills honed during their time as former prosecutors to future defendants accused of insider trading. They had no problem making the transition from denouncing apparent “greed” in the financial markets to defending that same greed, switching sides in an effective demonstration of greed. As partners at leading law firms they would be highly compensated. The “protectors from greed” sold themselves to the highest bidder, all under the trusting gaze of an unaware public. The door meant to separate and maintain a balance between the public and the private sectors revolves efficiently and profitably.
It is important to understand context of the time and the prevailing mood of the country in October 2009 when I was arrested. In 2008 we had seen the near collapse of the financial system and the wiping out of trillions of dollars of home equity and life savings of the American middle class. The government was forced to bail out the major banks. Mortgages that were bundled up or securitized and sold by banks had contributed to the crisis. Millions of American homes went into foreclosure. Institutions such as Lehman Brother, Bear Stearns, Fannie Mae, AIG and Freddie Mac either filed for bankruptcy or lost over 90% of their market value. An estimated $7 trillion in US household assets were wiped out. And to add to the catastrophe, in late 2008, Bernie Maddoff admitted to running the largest Ponzi scheme under the very eyes of the regulators. Politicians and the public placed the blame squarely on Wall Street. The pubic was clamoring for blood and there was no blood forthcoming. From anywhere.
I had nothing to do with the housing crisis. I was an easy target for politicians, for prosecutors, for pundits, and for Bharara who had just been handed leadership of the Southern District of NY including a mandate for bringing Wall Street under control. I was a successful and expendable hedge fund manager who employed just 250 people. We obtained an overwhelming amount of information on a daily basis and my trading was 100% consistent with the written recommendations of my analysts. In ALL cases, I had a pre-existing position in the stock before allegedly receiving the “tip.” In 2009 and even today, insider trading laws are murky at best and often (intentionally) misinterpreted by prosecutors. The government painted our systematic, well-researched investing as being criminal. Theirs was an overreach of enormous proportions to show that “Wall Street fat cats” were being brought to justice. If I am guilty, then the entire investment business should be declared illegal.
As the Wall Street Journal noted insightfully, “Under standard rhetoric, the public is somehow cheated by all this, but the standard rhetoric is nonsense. The public isn’t damaged because another party wants to sell or buy (and most hedge funds strive to make sure their trading doesn’t affect prices anyway). But a cynic might note one thing: insider-trading law provides a bottomless reservoir of (supposed) financial ‘crime’ for Washington to investigate whenever it needs a Wall Street prosecution to flounce in front of the press.” [Endnote 1]
As a child, having gone to boarding school in a foreign country at the age of eleven, I learned quickly and early to be a fighter, a scrapper. This is a blessing and a curse. Over the years, I have learned that you don’t always have to fight. The kindness of many people has defanged and disarmed me to a large extent. However, when people try to take advantage of me, I have to respond. I don’t back down. And I am fortunate to have been blessed with the mental fortitude and financial resources to fight for my innocence. Too many people do not. They plead guilty to indictments they cannot challenge. In my experience about 10% of the inmates at the prison in which I spent seven-and-a-half years were innocent.
When I was researching the Justice Department while in prison, I came across a paragraph that struck a chord in me. Unfortunately, I did not write down the name of the author or the source. “Criminal punishment is the greatest power that governments use and wield against their own people. When employed justly and appropriately, it is vital to any safe and productive society. But when employed aggressively based on vague laws and personal agendas the criminal justice system unnecessarily destroys lives, livelihoods, and families.”
Oddly, my experience of the law has left me without rage or a sense of victimhood. While I would never say I am grateful for the experience, I can say with confidence that I like myself better because of it. When I finally broke through the wall of despair, I realized I had gained a sense of peace and awareness that had opened me up and cracked me free. I realized how incredibly strong the human mind is and that nothing can beat a person who refuses to be beaten.
Finally, I want to say that despite what happened to me as a result of a corrupt prosecutor, I love this country just as much as I did before I went to prison. I feel truly blessed to be one of the 5% of the world population who live in America. I do not see people lined up to emigrate to China, Russia, or Japan, for example.
As I reflect on my circumstances and my past, if God had arrived at my doorstep when I was 11 – with a crystal ball — and told me, “Raj, I will give you the wife and children you see here, these friends, and ensure that both your parents live long and happily and give you also the ability to help the less fortunate — But you need to sacrifice about seven years of your life,” I would have taken that deal in a New York second.
I feel very fortunate.
I am very fortunate.
Raj Rajaratnam
February 2021
Features
Social justice in suspense: Sri Lanka’s welfare legacy in an era of austerity
by Prof. M.W. Amarasiri de Silva
The evolution of Sri Lanka’s social policy framework represents one of the most compelling, paradoxical, and debated case studies in the global political economy of development. Often celebrated as an exceptional model among developing nations, Sri Lanka achieved human development indicators, such as high adult literacy, elevated life expectancy, and low infant mortality, that rivaled those of industrialised Western societies, despite maintaining a low-to-middle per capita income. This distinct trajectory was fundamentally sculpted by the establishment of an extensive welfare state, characterised by universal healthcare, free education, and pervasive food subsidies.
However, the long-term impact of this historical welfarism on present-day Sri Lanka presents a complex matrix of social triumph, economic vulnerability, and systemic crisis. To fully comprehend how the historical welfare state has shaped contemporary Sri Lanka, one must trace the institutional genesis of these policies through the critical frameworks provided by eminent social theorists, notably Ralph Peiris in his analysis of Asian development styles and Laksiri Jayasuriya in his landmark work on Sri Lanka’s experience of social development directed toward equity and justice.
Foundation of welfare state
The structural foundation of Sri Lanka’s welfare state was not a post-colonial luxury, but rather a late-colonial construct deeply interwoven with the dynamics of democratization and constitutional reform. As Laksiri Jayasuriya meticulously argues in his historical and theoretical explorations of Sri Lankan social policy, the trajectory of the country’s social development was rooted in the state-building exercises of the late British colonial era. The introduction of universal adult suffrage under the Donoughmore Constitution of 1931 served as a pivotal catalyst. By enfranchising the local population decades before formal independence in 1948, the colonial state altered the political elite’s incentives.
Politicians were suddenly forced to seek electoral legitimacy from a vast, rural, and economically disadvantaged populace. This constitutional shift institutionalised what Jayasuriya terms a culture of ‘welfare politics,’ where competitive electoral democracy became intrinsically linked to the provision of social goods.
During the period spanning from the 1930s to the 1950s, the state laid down the three pillars of its social safety net: free state-provided healthcare, free universal education from primary to university levels (championed by C.W.W. Kannangara), and a heavily subsidised food rationing scheme, most notably the rice ‘polu’ (haal polla) system. In the popular Sri Lankan vernacular and historical memory, these restrictive barriers and checkpoints became closely associated with the rationing culture surrounding the rice distribution and cooperatives where state-allocated rice rations were obtained via coupon books.
Jayasuriya highlights that these measures were conceived not merely as safety nets for the destitute, but as fundamental rights of social citizenship modeled partly on the egalitarian principles of the British post-war welfare state yet adapted to a post-colonial environment seeking equity and social justice. This social democratic commitment was maintained across alternating political regimes, creating a broad cross-party consensus that state-funded welfare was an untouchable social contract between the state and its citizens.
Policy trajectory in perspective
To place this unique policy trajectory in a broader comparative perspective, Ralph Peiris’s conceptualisation of ‘Asian Development Styles’ offers a critical lens. Peiris examined how different Asian nations navigated the tensions between Western models of modernisation, economic growth, and indigenous social structures. Many East Asian economies—such as South Korea, Taiwan, and Singapore—adopted a development style centered on ‘growth-first’ imperatives, state-directed capitalism, and the deferral of widespread social expenditure until after rapid industrialisation was achieved. In contrast, Sri Lanka pioneered a distinct ‘social-led’ development style within South Asia. Peiris observed that Sri Lanka’s development style prioritized human capability, social redistribution, and basic needs over raw capital accumulation. This style reflected a socio-cultural ethos that viewed social harmony, equity, and state paternalism as integral to governance, resisting the purely utilitarian or market-driven metrics of economic progress.
The immediate consequences of Sri Lanka’s socio-centric development style were undeniably positive in terms of human wellbeing. By the late 20th century, Sri Lanka had achieved a physical quality of life index that far surpassed its South Asian neighbors. Maternal and infant mortality rates dropped precipitously due to widespread access to free public health facilities and midwife networks. Universal education fostered a highly literate electorate, dramatically closed the gender gap in basic and secondary education, and enabled significant upward social mobility for marginalized caste and rural communities. Jayasuriya emphasizes that this commitment to equity and justice transformed the social fabric, democratising access to public life and cultivating a politically conscious citizenry that viewed education and healthcare as non-negotiable entitlements.
However, the enduring legacy of this historical welfare state is dual-edged, carrying deep-seated economic contradictions that directly contributed to present-day Sri Lanka’s socio-economic landscape. The central paradox of the Sri Lankan welfare state lay in the disconnect between social expansion and economic productivity. While the state committed huge fractions of its national budget to social consumption, it failed to build a resilient, diversified industrial export base capable of generating the revenue necessary to sustain these expenditures over generations. The primary revenue source funding the early welfare state was the taxation of the colonial-era plantation export economy—primarily tea, rubber, and coconut. As global commodity prices fluctuated and deteriorating terms of trade eroded plantation revenues in the post-independence decades, the state faced severe fiscal deficits.
Macroeconomic imbalances
The fiscal strain of maintaining universal subsidies led to severe macroeconomic imbalances by the 1970s. The state attempted to manage these pressures through import-substitution policies, strict price controls, and state monopolies, culminating in the closed economy of 1970–1977. While this period sought to preserve the egalitarian principles articulated in Jayasuriya’s analysis of social justice, it resulted in severe shortages of essential goods, economic stagnation, and rising unemployment among the newly educated youth. The inability of the economy to absorb the expanding class of literate, ambitious young citizens created a structural mismatch between educational output and employment opportunities.
This socio-economic disjunction erupted into violent political crises. The educated yet economically disenfranchised rural youth became the primary base for insurgencies, such as the Janatha Vimukthi Peramuna (JVP) uprisings in 1971 and 1987–1989. Concurrently, the failure to extend equitable socio-economic and political opportunities to the Tamil minority—compounded by language policies that prioritized the Sinhala majority in public sector employment—fueled ethnic marginalization, eventually escalating into a devastating nearly three-decade-long civil war. Thus, as both Jayasuriya and Peiris observe in their respective analyses, while the welfare state was designed to promote social cohesion and equity, its economic unviability and politicization contributed to social frustration and structural conflicts when the economy failed to fulfill the aspirations created by universal social programs.
Janasaviya, Samurdhi and Aswesuma
A profound structural turning point occurred in 1977, when Sri Lanka became the first country in South Asia to abandon import-substitution and embrace neoliberal market-oriented economic reforms. The advent of the ‘Open Economy’ signaled a major shift in the state’s social policy regime. As Jayasuriya notes in his critique of the post-1977 retreat from the welfare state, universal welfare policies were systematically dismantled or reconfigured into targeted, means-tested poverty alleviation programs. The universal food subsidy was replaced by food stamp programs and later by targeted cash transfer schemes such as Janasaviya and Samurdhi, and eventually Aswesuma.
This transition from universal social citizenship to targeted safety nets marked a fundamental redefinition of the social contract. While the 1977 open market policies stimulated economic growth, foreign investment, and infrastructure development, they also led to rising income inequality, regional disparities, and the commercialization of public goods. The state’s fiscal commitment to public education and health gradually eroded as a percentage of GDP, leading to a dual-track system.
Underfunded state healthcare and education systems remained free but suffered from resource constraints, overcrowding, and quality decline, while a burgeoning private sector in health and tuition-based education emerged to cater to the affluent. Jayasuriya argues that this marketization of social services undermined the egalitarian ideals of social justice that had historically anchored the nation’s social policy.
The contemporary manifestation of this historical trajectory became starkly apparent during the unprecedented economic crisis that engulfed Sri Lanka in 2022 and its continuing aftermath. The crisis—characterized by sovereign debt default, hyperinflation, severe foreign exchange shortages, and acute shortages of fuel, medicines, and food—exposed the fragile structural foundations of the country’s political economy. The roots of this crisis are inextricably linked to the unresolved tension between public expectations built by historical welfarism and modern neoliberal fiscal mismanagement.
Welfare and populism
Over recent decades, successive governments continued to rely on populism to secure electoral victory, promising subsidies, tax cuts, and public sector employment without building a sustainable tax base or correcting structural economic deficits. When the state faced catastrophic revenue declines following ill-advised tax cuts in 2019, combined with the shock of the COVID-19 pandemic and debt-driven infrastructure spending, the fiscal apparatus collapsed. The resulting austerity measures, mandated under International Monetary Fund (IMF) stabilization programs, forced sharp reductions in energy subsidies, increased indirect taxation, and deep spending cuts that severely hit vulnerable populations.
In present-day Sri Lanka, the legacy of the welfare state manifests as both a vital buffer and a site of intense political contestation. On one hand, the historical infrastructure of universal health and basic education has prevented an even more catastrophic loss of human life during the peak of the recent economic collapse. The enduring social capital, public health institutions, and high literacy rates provided a baseline of societal resilience that assisted communities in coping with immense economic shock. The persistent popular memory of social entitlement has also fueled widespread civic mobilization, as demonstrated by the Aragalaya mass protest movement in 2022, which demanded accountability, social justice, and an end to political corruption—echoing the deeply ingrained political culture of democratic accountability that Jayasuriya identified as a byproduct of early welfarism.
Challenge of restructuring social policy
Contemporary Sri Lanka faces the immense challenge of restructuring its social policy framework in an era of stringent fiscal constraint. The rollback of state subsidies and the rising cost of living have pushed millions of citizens below the poverty line, threatening to reverse decades of hard-won human development gains. Malnutrition rates among children have spiked, access to essential imported life-saving medicines has been compromised, and the real value of state pensions and social assistance has been severely eroded by inflation. The targeted social safety nets, such as the Aswesuma welfare scheme introduced to replace Samurdhi, have faced significant administrative challenges, exclusion errors, and public resistance, reflecting the ongoing difficulty of transitioning from universal rights-based social protection to targeted relief mechanisms in a deeply distressed economy.
Furthermore, the contemporary economic crisis has intensified a major ‘brain drain,’ as highly educated medical professionals, engineers, university lecturers, and skilled workers migrate abroad in large numbers. This mass emigration directly exposes the present-day crisis of Sri Lanka’s historical social model: the state continues to invest significant public resources into providing free secondary and tertiary education, but the domestic economy fails to offer economic stability and professional opportunities to retain this human capital. Consequently, the social returns on the state’s educational investment are increasingly captured by developed nations, leaving domestic public institutions further depleted.
In evaluating the contemporary impact of Sri Lanka’s social policy through the theoretical insights of Ralph Peiris and Laksiri Jayasuriya, it becomes evident that Sri Lanka’s history is neither a pure success story nor an absolute policy failure. Ralph Peiris’s emphasis on Asian development styles reminds us that development cannot be reduced merely to economic output metrics; the deliberate choice to prioritize human capabilities and social equity established an enduring standard for human welfare in the global South. However, as Jayasuriya’s critical analysis reveals, a welfare state cannot exist in an economic vacuum. The failure to integrate social policy with a productive, sustainable, and equitable economic strategy created structural vulnerabilities that ultimately undermined the very social justice the state sought to achieve.
Socio-economic contradiction
This socio-economic contradiction has entered a critical new phase under the administration of President Anura Kumara Dissanayake and the National People’s Power (NPP) government, which assumed office with an explicit mandate focused on systemic corruption reform and equitable development. Facing the stringent structural constraints of post-default economic management, the administration has adopted a pragmatic, hybrid economic framework designed to reconcile Sri Lanka’s historic social protection legacy with strict international fiscal discipline. Rather than abandoning structural reforms, the government maintains continuity with the Extended Fund Facility agreement managed alongside the International Monetary Fund (IMF), adhering to primary budget surplus targets and progressive revenue-mobilisation goals. However, it attempts to reorient macroeconomic priorities away from elite-driven financialization toward a state-regulated, productive market economy centered on public sector transparency, digitalization, anti-corruption legislation, and the revitalisation of local agriculture and manufacturing.
Policy of rebalancing
This policy rebalancing directly reflects the enduring relevance of Peiris’s ‘Asian development style’ framework, as the state seeks to build export competitiveness while retaining public oversight of basic social safeguards. Yet, as Jayasuriya cautioned in his critiques of targeted safety nets, managing fiscal austerity within a political culture historically accustomed to universal state entitlement poses severe domestic challenges. High living costs, continuous pressure on public sector wages, structural poverty, and the persistent outflow of skilled human capital leave narrow margins for error. Contemporary Sri Lanka’s economic policy thus represents an ongoing attempt to construct a viable, modern economic model—one that generates sustained productivity and debt sustainability while preserving the foundational democratic imperative of equity and social justice that has defined the nation’s post-colonial identity.
Features
Cholesterol lowering statins: Scope for use widens
by Dr Upul Wijayawardhana
In my medical practice of just under 57 years, divided almost equally between Sri Lanka and the UK, I have been fortunate enough to meet some remarkable patients who demonstrated indomitable fortitude. Not that there were no nasties, but, fortunately, they were extremely rare. Now well into my retirement, I can still vividly remember some remarkable cases as if they happened yesterday. One of them well illustrates what happens when prescription warnings are ignored; that can result in drug interactions producing nasty, sometimes lethal, side effects.
A man in his sixties was admitted under my care to Grantham Hospital with progressively increasing muscle pain and weakness, being almost bedbound by the time of admission. It was pretty obvious that there was extensive damage to muscles which was confirmed by huge elevation of markers of muscle damage. A careful history, one of the vital steps needed for diagnosis, revealed that he was on long-term statin therapy following a heart attack and his GP has recently prescribed an antifungal agent for an infection in the groin. This was before the computerised prescription era and is not likely to have happened now, as a red-alert would be displayed as antifungals are known to produce severe interactions with statins. Both drugs were stopped, and with supportive therapy, he recovered fast and walked out of the ward two weeks later. He was started on a different statin later with no problems.
Would this experience make me join the vast numbers of YouTubers who are harping on the dangers of statins? Definitely not. I say so because the benefits of statins far outweigh the rare side-effects. All drugs have side effects and, in some trials, placebos producing more side effects than the active drug itself! Drugs need to be prescribed by those with education and experience whilst prescribers need to be updated regularly. Statins, perhaps, are the most widely used class of drugs and the scope for use is widening with the reporting of new clinical trials, two significant trials being presented at the European Society of Cardiology Congress held last month in Munich.
It was known for a long time that elevated levels of cholesterol in blood leads to damage of arterial walls (atherosclerosis) which manifests as cardiovascular disease including heart attacks, cerebrovascular disease including strokes and peripheral vascular disease. Various attempts at lowering cholesterol effectively by diets, drugs and surgery were largely unsuccessful till statins were discovered and it was soon realised that cholesterol synthesis by the body is more important than ingestion of cholesterol rich foods and saturated fats. Statins inhibit cholesterol synthesis in the body and the first statin released for therapeutic use was Lovastatin in 1987, but wide use of statins started only after the release of results of the landmark 4S trial in 1994.
The Scandinavian Simvastatin Survival Study (4S) was a multicentre, randomised, double blind, placebo controlled clinical trial which used Simvastatin, the second statin released for use a year later in 1988. 4444 patients, who previously had a heart attack or were having angina with moderately elevated levels of cholesterol, in spite of rigorous dieting, were recruited from 94 centres in Scandinavia. After follow-up of 5.4 years, compared to the placebo group, it was shown that the group treated with Simvastatin showed lowering of LDL cholesterol (Bad Cholesterol whereas HDL cholesterol is protective) by 35% and, more importantly, lowering of death rate by 30%. A follow-up study of 10 years showed continuing benefits. More trials and more statins followed.
Though Simvastatin had widespread use initially, the more powerful Atorvastatin, launched in 1997, overtook producing more dramatic results in subsequent clinical trials. Till the introduction of monoclonal antibodies (mAbs), laboratory produced proteins that mimic the immune system and capable of targeting antigens in cells or pathogens (which can be identified as the drug names end with ‘mab’) Atorvastatin was the highest grossing drug of all time, in spite of prices dropping sharply. There had been a proliferation on mAbs as many are used in a number of cancers and auto-immune diseases, earning more money as they continue to be expensive.
I remember a meeting I attended, just after the results of the 4S trial was released, where fears were expressed whether the NHS would go bankrupt if all eligible patients were prescribed Simvastatin. Widespread use has brough prices tumbling down, a tablet of Atorvastatin now costing in UK only 3p!
Though the initial trials were for secondary prevention, reduce recurrence after the disease has manifested, subsequent trial were aimed at primary prevention, preventing or delaying disease occurrence in those with high risk factors. These too showed significant benefits and the scope for use of statins continue to expand. Two significant trials were presented at the ESC congress.
The first was the STAREE study, which enrolled 5000 persons, over the age of 70 in Australia, with no history of cardiovascular disease, diabetes or dementia and half got Atorvastatin 40mg daily, the other half getting a placebo. Results showed a significant 30% reduction of a composite end point of death from cardiovascular causes, nonfatal myocardial infarction, stroke or coronary revascularization. Interestingly, incidence of serious adverse effects was similar in both groups being 2.6%. There was no significant reduction of death rate by itself. Perhaps, this is explained by most deaths being due to non-cardiac causes in this age group.
The second was a Danish observational study, where researchers assessed whether early initiation of statins after the diagnosis of type 2 diabetes was associated with a lower risk of dementia. Over 10 years, early statin initiation was associated with a 15% lower relative risk of dementia than no statin treatment, while late initiation was associated with a 10% lower risk. Though they studied the records of 132,585 patients, as this is an observational study, not a double blinded clinical trial, results are not as convincing and may have to be reaffirmed by further studies.
How will the results of these two trials affect clinical practice?
To act on the results of these trials is not difficult in the UK. Those over 80 years are already offered a statin and it would not be difficult for GPs to extend use to those over 70. Most diabetics, unless relatively young, are likely to be on a statin already, as they are categorised as high risk. There are no cost implications to patients as diabetics and those over 65 years get all their drugs free from NHS.
Unfortunately, things are likely to be very different in Sri Lanka. Diabetes is rampant and dementia is on the rise. As life expectancy is increasing and those over 70 being an ever-increasing group. Diabetics may be able to get a statin from government hospitals. However, there is no provision for free supply of statins for over 70 group, as this is for primary prevention. With exponentially increasing cost of living, retirees may find it difficult to afford a statin.
Ideally, Atorvastatin 40mg daily, the dose used in the trials, should be taken though one can argue that other statins may be effective as benefits are likely to be a group effect. As many trials used the 40mg dose, Pfizer decided to price 10mg, 20mg and 40mg Atorvastatin tablets the same, but this is unlikely in Sri Lanka, what is available being generics; Atorvastatin went out of patent protection in 2011. If 40mg tablets are significantly more expensive, perhaps, a lower dose could be considered as the average body size of Sri Lankans is smaller than that of Australians.
It can be argued that even a small dose is better than taking no statin at all. Maybe there is a good opportunity for our scientists, perhaps together with their Indian counterparts to do clinical trials to establish appropriate doses of statins and other drugs, rather than follow Western guidelines. Until then, it may be sensible to give anyone over 70 years an affordable dose, with some patient education on adverse effects could be minimized.
Statins are a valuable tool for the prevention of vascular disease. They not only reduce deaths but also improve quality of life by preventing debilitating illnesses. Like any drug they too have adverse effects and should be used under proper medical supervision. Worst thing to do is to listen to fear-mongers!
Features
‘Mortal Causes’ Tales of Mystery and Suspense 20
Tales of Mystery and Suspense 20
by Prof. Rajiva Wijesinha
After the elegance of Agatha Christie and Hercule Poirot, I revert to one of the least elegant detectives I have looked at. The first John Rebus novel by Ian Rankin I discussed here was Set in Darkness, though I think I failed to mention the title. That does not really matter for Rankin’s titles seem a bit interchangeable. Certainly, the title of the book I will explore today, Mortal Causes, could apply to most Rebus adventures.
But this too was a gripping tale, and also dealt with what used to be a disturbing social issue in the last quarter of the last century, namely violent clashes between Catholics and Protestants, which had their roots in the age-old question of Northern Ireland and its place in the United Kingdom. The root problem there was the influx, when Ireland was comprehensively taken over by the English, of Protestants from Scotland, who were so entrenched in the north of Ireland, the area known as Ulster, that they stopped Britain from granting independence to the whole of Ireland.
Ulster remained a part of the United Kingdom, but over the years the Catholics there, supported by the Irish Republican Army, the IRA, agitated for union with the Republic of Ireland. This was bitterly resented by the Protestants, and emotions ran high, as I found when I tried to bring together Catholic and Protestant friends when I was at Oxford.
The sixties saw the overthrow of three Prime Ministers of Northern Ireland, each succeeding one being more committed to the Protestants than his predecessor, for there was a preponderance of Protestant constituencies. But the Catholic numbers were proportionately increasing, and the IRA of course got support from the Irish Republic, with the border being porous and impossible to patrol. This led to vicious reprisals by British troops, and it was their failure to address excesses over the years that made clear their infinite hypocrisy in criticizing Sri Lanka for excesses during the civil war, demanding inquiries while signally failing to address the massacres of Catholics in Northern Ireland.
Mortal Causes
deals with the repercussions of this rivalry in Scotland, where the latent animosity between Catholics and Protestants was exacerbated by events in Ulster. Obviously Scottish groups were keen to help their fellow religionists, and the book is based on how money was collected and guns smuggled in to Ulster. But typically, Rankin also looks at how the proliferation of guns led to the strengthening of gangs, who engaged in extortion, with on occasion Catholic and Protestant guns maintaining a truce so that they could each exploit their own catchment areas.
A microcosm of what went on was seen in a youth club in a seedy housing estate in Edinburgh, to which a Catholic priest Rebus was friendly with sent a youngster who was supposed to bring the communities together. Though this resulted in a truce, it was in essence an arrangement that allowed both Catholics and Protestants to deal in intimidation of their different communities in the area. And the club was dominated by the protestants, led by a youth called David Soutar, who is endemically violent, and takes against Rebus on his very first visit, after he had promised Father Leary to look into the situation.
The youth club turned out of course to be connected with the murder that set off the investigation, though this only became clear because of Rebus’ painstaking investigation of that crime. It was a brutal killing, in an underground section of the city, usually only to be seen by arrangement with the city council. The bodies were discovered by some youngsters, one of whom had purloined a key from his great uncle who was one of the custodians, who provides important information in the course of the investigation to make up for that lapse.
Before that Rebus had realized something bigger was behind the gruesome murder, for while part of the team at his own station he was asked by a Chief Inspector with the Scottish Crime Squad, Kilpatrick, to work also with his team. He had come to the site of the crime with an Inspector from London, Abernethy, who went back almost immediately to London. And though Abernethy mentioned the possibility of the killing being because of drugs, Rebus stuck to his view that it was terrorism related.
The body was soon enough identified, that of a youngster who lived with a couple called Murdock and Millie, and had Protestant insignia on his walls. And painstakingly Rebus established connections with diehard Protestants, one of whom, called Bothwell now which was his parental name, had edited a magazine while stationed in the Orkneys but now ran a dance club in Edinburgh. And he also deduced that SaS tattooed on the arm of the dead body stood for Sword and Shield, an extreme Protestant organization to which it transpired that David Soutar also belonged.
Alarmingly, it turned out that the dead Billy was the illegitimate son of Rebus’ old antagonist Ger Cafferty, who was now serving time in prison. But when he hears that his son had been murdered, he escapes, and makes it clear, through several contacts with Rebus, that he expects the killers to be found, and that he will take revenge on them.
Rebus and Inspector Smylie from the Crime Squad have to fly to Ulster to collect information which the police there refuse to transmit, and find nothing special though they confirm the existence of an extreme group called Sword and Shield, and that it has branches in America. And it seems that one of its leaders in Ulster has just gone to Scotland, while the Americans confirm that another leader will be flying to England and then to Edinburgh. Rebus asked Kilbride to tail the latter, and he says he will set two of his officers, who have no affection for Rebus, on to him.
When Rebus and Smylie get back from Ulster, Rebus is taken aside by one of these officers who says that Smylie’s brother Calumn, who was also part of the Crime Squad, and had been working undercover on arms shipments, has been murdered. This makes it clear that the arms smuggling is the key to the deaths, and also that there has been a leak from the Crime Squad.
And then Millie, who had taken a disk which Billie had hidden in his wall and fled, is also found killed. She had sought shelter with a friend who worked at Bothwell’s club, and the friend had told Bothwell about this, which was doubtless why she had been killed.
When the American organizer of Sword and Shield comes to Edinburgh Rebus manoeuvers a meeting with him, though not without rousing his suspicions. But the reports he receives from Kilpatrick of the surveillance say that he has just been doing touristy things.
The book is set during the Edinburgh Festival, and the police have been getting several calls to say a bomb will go off at its height. And Rebus now realized that this is precisely what Soutar is planning to do, having creamed off some of the weaponry, including explosives, that he had been collecting for transmission to Ulster.
These were stored in a facility provided for him by a friend whose father ran the group, but knew nothing about what Soutar was planning. The son, terrified by what he had been involved in and what the police knew, took Rebus to the warehouse which was where, DNA tests of the floor revealed, Calumn had been killed. And when Rebus and Abernethy, whom he had called up from London, confront Bothwell, it seems he too did not know of Soutar’s little sideshow, though it was also clear that he had known of Millie’s death, as well as Billy’s.
Her murderers had got the compact disk but her flatmate, though he had destroyed the backup, had looked at it before and that was how Rebus found out about the warehouse that Soutar had used. But then he goes with Abernethy to the warehouse in which the Crime Office had kept the weapons they had found, and they both confront Kilbride there and tell him that they know he too had been a member of SaS – the granduncle having shared his research with Rebus – and had passed on parts of what was confiscated to Soutar, since he was in a position to change the invoices.
But he too evidently did not know what Soutar was planning, and when Rebus goes to the youth club it is to find that Soutar had nearly killed him, and had then set off for the festival. There is great drama then as Rebus tries to stop him setting off whatever bomb he has and, though he is nearly killed, as happens in so many Rankin books at the end, Abernethy shoots Soutar dead.
Then however, when Rebus goes to the dance club for what he thinks of as final business, he finds it on fire. Bothwell has been killed. But he finds the American inside and pulls him out. When he goes further and finds the man from Ulster in a chair, tied up so he would burn, he tries to free him and then is again nearly killed, though this time he is rescued by Cafferty – who tells him it was not to save him that he had come in but to make sure he did not save the other man, the American having slunk away after Rebus had taken him outside the burning building.
The American is apprehended when he was trying to leave the country. But Kilbride is smothered in his hospital bed when he was recovering, so Cafferty’s vengeance for his son was almost complete.
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