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Editorial

The galloping stock market

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The Colombo stock market has been galloping like nobody’s business these past several days with little or no rational explanation of why this is so in the context of a pandemic-hit business downturn. Among the reasons that have been proffered by brokers and analysts for this surge in confidence of market players, and they have increased substantially in recent months according to the CSE, is that interest rates are plunging. Investors who could earn as much as 12 or 13 percent or more on fixed deposits not so long ago, have to be now satisfied with marginal returns way below the prevailing rates of inflation. They are thus attracted to a stock market which is now performing better than most others in the region.

But the surge on the Colombo market is not supported by foreign or institutional buying which knowledgeable people say is necessary to sustain the current momentum. In fact there has been a steady outflow of foreign funds from Colombo in recent months and there has been no stemming of this flow. Although various authorities have more than hinted that institutions like the Employees Provident Fund and the Insurance Corporation will be back in the market in the short term, this does not appear to have come to pass.

Little wonder. There have been a plethora of allegations about pump and dump and market manipulation that institutional fund managers will be reluctant to open themselves to fresh accusations. This would mean a safe ‘do nothing’ philosophy unless they are ordered to enter the market. We do not know whether there is political or any other directions on what state-controlled entities should do with regard to stock market investment today. But we do know that this has happened in the past. It has been rightly urged that the EPF is only the guardian of the private sector retirement fund it manages, and not its owner. The fund belongs to its members who, together with their employers, make monthly contributions to it as a retirement saving. It must therefore refrain from speculative investments like stock trading is the conservative viewpoint.

The contra-argument has also been adduced. The EPF has long been a captive lender to the government. Government borrowing would naturally ease as the economy grows and there was official thinking within the Central Bank that it made sense to invest in private sector growth areas through the stock market as a long-term strategy. This was done to some degree that was admittedly small. Those who read the annual reports of listed companies, and even their quarterly financial reports listing their top twenty shareholders, will know that that the EPF has substantial stakes in many blue chip companies. There must be a lot of unrealized capital gains in the EPF portfolio where the pluses will outweigh the minuses although the fund cannot always back winners. If its members get an annual dividend ahead of inflation on their individual holdings in the fund, nobody can reasonably complain.

The benchmark All Share Price Index of the CSE has already topped its all time high and the upward momentum continued as this is being written on Friday. Where it will end, nobody can say. It is certainly a good thing for the country that many small investors are entering the stock market which is now retail driven. A completely new class of investors have today entered a field which not so long ago was the exclusive preserve of the rich. Massive turnovers in the billions are being recorded on the CSE every day and stockbrokers who had a lean time as the Easter bomb and the pandemic hit forcing market closure for a long period, would now be laughing all the way to the bank. While the market and its players can bask in the current sunshine, it is very necessary to attract foreign investors back to the CSE. This will undoubtedly be a formidable tasks but a bull run such as that which ongoing can be a factor that can prove persuasive.

 

Ranjan Ramanayake

 

The Chairman of the Elections Commission went on public record that Ranjan Ramanayake, the actor politician, who has now begun serving his term of four years rigorous imprisonment will not lose his parliamentary seat for six months. But the attorney general has said otherwise and the elections boss has subsequently stated that what he had expressed is a personal opinion. However that be, the Ramanayake issue remains very much alive in parliament where his Samagi Jana Balavegaya colleague, Harin Fernando sported a black shawl last week and said he will continue to wear it until Ranjan returns. Parliamentarian M.A. Sumanthiran, who defended Ramanayake in the Supreme Court also spoke up for the actor saying he was privileged to appear in court “for a clean, honest politician and I’m proud of that.”

The Speaker is yet to rule whether the convicted MP is entitled to attend parliament and promised to announce his decision in three weeks. Readers know that other prisoner-parliamentarians have previously attended sessions, but what will happen in this instance remains an open question in the short term. While most people believe that there is no appeal from a Supreme Court determination and a presidential pardon is the only way out, a contrary view relative to this matter has also been expressed in the context of the International Convention for Civil and Political Rights (ICCPR) to which Sri Lanka is a signatory.

In parliament last week Sumanthiran drew attention to the fact that Sri Lanka has failed to enact legislation for contempt of court although some work in that regard had been done. Expressing the view that the term imposed on Ramanayake was unprecedented and exceptionally severe, he drew attention to a serious lacuna in the law which has resulted “in an unprecedented injustice to an honest Member of Parliament.” Ramanayake has consistently refused to apologize for the offence over which he was charged; his parliamentary colleague, Lakshman Kiriella, also last week referred to the conduct of two former chief justices, although under the protection of parliamentary privilege. Such reference had obvious implications in the context of what Ramanayake said.



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Editorial

Problem of being POTUS Biden

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Saturday 13th July, 2024

US President Joe Biden is in the news for all the wrong reasons, ranging from his backing for Israel, which is wreaking havoc on Gaza, and his unconditional support for Ukraine, which is ruining itself by fighting a proxy war against Russia at the behest of NATO. Pressure is now mounting on him to leave the presidential race owing to a string of gaffes and other signs of memory lapses, the latest being his slip-up during a presser, where he spoke to reporters about continued NATO support for Ukraine; he referred to Ukrainian President Volodymyr Zelensky as President Putin much to the astonishment of all those present. Biden promptly corrected himself, saying jokingly that he was so focused on beating Putin that he had erred, but the press and the US public were far from amused. His accidental falls, which are many, confused state of mind, gaffes, etc., have prompted the Americans to ask if he is mentally and physically fit enough to serve another term. Even the Democrats have expressed serious doubts about his eligibility to recontest.

Chances are that the Democrats will find it extremely difficult to allow Biden to run for President again, and they may even be compelled to opt for some other candidate, given his appalling performance in a recent debate with his arch rival, Donald Trump. Paradoxical as it may sound, Biden has become an invaluable political asset to Trump; his signs of failing mental and physical health have distracted public attention from Trump’s deficiencies and wrongs, which are legion. If Trump had faced a Democrat of the calibre of Bill Clinton or Barack Obama in the debate, his fate in the presidential race would have been sealed then and there.

Biden is determined to contest, but he is coming under increasing pressure to undergo detailed cognitive and neurological testing. He has the same determination as Sri Lankan politicians to cling on to power. Obviously, his kitchen Cabinet does not want him to call it quits.

The real question however is not whether Biden is mentally and physically fit enough to seek re-election; instead, it is whether the US would have done differently on his watch if he had been free from the mental issues he is allegedly grappling with. Whenever one watches, on television, the ongoing carnage of Palestinians in relentless Israeli attacks, one wonders whether all those who support the Gaza invasion are of sound mind, much less of good moral character which they claim to possess. Would any other US President have stepped in to stop the massacre of civilians including children, in Gaza? Biden’s predecessors were no different. Bloody military coups and wars that the US has engineered to further its geo-strategic and economic interests at the expense of tens of thousands of lives in other countries make one wonder whether the American Presidents who presided over them were of sound mind. Even Clinton and Obama, who was given the Nobel Peace Prize even before he was ensconced in office, unflinchingly backed the destruction of life and property on the pretext of protecting democracy and combating terrorism.

Most of all, if Biden is not mentally fit enough to seek re-election, as many Americans including Democrats are said to believe, the question is whether it is advisable to allow him to continue to serve as the President of the most powerful nation on earth until November 2024. There are situations where Biden confuses wars. He has recently referred to the Ukraine war as the Iraq war. A wag asks what would happen if he ever mistook the nuclear button, which is said to be on his desk, for some other switch?

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Editorial

Forgotten flaws in laws

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Friday 12th July, 2024

The government is going hell for leather to resolve some constitutional ambiguities as regards the length of the presidential term, etc. Now that the Supreme Court has determined that the duration of the President’s tenure is five years, the matter could be considered closed.

The government is apparently trying to use the constitutional amendment on the anvil to bolster its claim that it had nothing to do with the abortive fundamental rights petition that sought to delay the next presidential election on the basis of a non-existent constitutional issue. However, there is a pressing need to rectify some real flaws in the Constitution and make new laws to safeguard democracy. The Parliamentary Elections Act should also be amended to prevent it being used to circumvent a vital constitutional provision pertaining to the people’s franchise.

A chronic flaw in the Constitution allows political party leaders and their cronies to undermine the people’s franchise. It enabled Ranil Wickremesinghe, who lost his seat in the 2020 general election, to enter Parliament via the National List (NL) and become the President. Even a person who has never contested a parliamentary election can enter Parliament by having an NL vacancy created; worse, it is possible for him or her to become the President in a situation like the one we experienced in 2022. Hence the need for a constitutional amendment to prevent the misuse of the NL mechanism.

A questionable change effected to the parliamentary election laws about 36 years ago has had a corrosive effect on the Constitution, especially the people’s franchise, which is a fundamental component of representative democracy. That abominable provision has enabled the political parties to bypass the Constitution and appoint individuals of their choice to Parliament as NL members.

As we have pointed out in a previous editorial comment, Article 99A of the Constitution allows only the persons whose names are included in the lists submitted to the Commissioner of Elections or in any nomination paper submitted in respect of any electoral district by political parties or independent groups at elections to be appointed to Parliament via the NL. In 1988, the then UNP government introduced Section 64 (5) of the Parliament Election Act, inter alia, as an urgent Bill, eroding the essence of the constitutional provisions pertaining to the NL and the people’s sovereignty.

The Parliament Election Act of No 1 of 1981, as amended in 1988, allows ‘any member’ of a political party to be appointed to fill an NL vacancy. After parliamentary elections, political parties appoint their NL members as prescribed by the Constitution, and thereafter engineer NL vacancies to bring in persons of their choice as MPs. Attempts to have this highly undemocratic practice terminated by judicial means have been in vain. This ‘smuggling tunnel’ must be closed once and for all.

Worse, it has now been revealed that the words, ‘any member’, were smuggled into the Parliamentary Elections (Amendment) Act after its ratification by Parliament! Strangely, there has been no sustained campaign for the abolition of this legal provision, which allows virtually anyone to enter Parliament without contesting a general election or being nominated as an NL candidate, and even become the Prime Minister, who takes over as the Acting President in case of the popularly elected President’s death, removal or resignation.

The aforesaid legal provision has become a fait accompli because the Constitution does not provide for the post-enactment judicial review of legislation. In a country like Sri Lanka, the need for the judiciary to be empowered to review laws after their ratification cannot be overstressed, given the devious methods that governments employ to subjugate even the Constitution to their political interests. It may be recalled that the UNP-led Yahapalana government stuffed the Provincial Council Elections (Amendment) Bill with questionable sections at the committee stage before rushing it through Parliament, in 2017, to postpone the Provincial Council polls indefinitely.

The vociferous members of both sides of the House, given to talking hind legs off a donkey, have not cared to take up the aforesaid issues which undermine the integrity of the Constitution and the electoral process. No wonder public confidence in Parliament is at a low ebb; anti-politics is on the rise, and protesters wear Guy Fawkes masks.

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Editorial

Grusha and Ayesha

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Thursday 11th July, 2024

The SLPP-UNP government has become an epitome of absurdity. Its leaders made frantic efforts recently to grant Attorney General (AG) Sanjay Rajaratnam a service extension amidst protests. They even strove to manipulate the Constitutional Council to compass their end. Thankfully, their plan went awry. Rajaratnam, however, should consider himself lucky; if they had succeeded in extending his term, he would have ended up having to pull a lot of political chestnuts out of the fire for them. Now, those worthies who went all out to give Rajaratnam what he did not deserve are denying Solicitor General Ayesha Jinasena what she richly deserves—the post of Attorney General. They are dragging their clumsy feet on the appointment of the AG.

SJB MP Rohini Wijerathne, speaking in Parliament, on Tuesday, asked the government why Ayesha had not been elevated to the post of AG. Her question went unanswered. She accused the government of discriminating against Ayesha in spite of having passed new laws to ensure women’s empowerment. She has struck a responsive chord with the public.

A request made by the Bar Association of Sri Lanka (BASL) to President Ranil Wickremesinghe that the seniority principle be honoured in appointing the next AG has elicited a negative response. Saman Ekanayake, Secretary to the President, has reportedly informed the BASL that it should not advocate for the claims of a single candidate, and there is a need for a broad consideration of all potential candidates to ensure the appointee commands the confidence of the President and the Cabinet. It is the adoption of this criterion in making appointments to high posts that has ruined the state service as well as the country; most public officials command the confidence of the powers that be but are square pegs in round holes; they consider it their duty to please their political masters, and never do they serve the interests of the public. The country needs upright, capable officials in key positions in the state service.

Self-important Sri Lankan politicians want to have all others, including judges, on a string. They have succeeded in reducing the AG’s Department to a mere appendage of the government in power, over the years, to all intents and purposes, and the time has come for it to be liberated from their clutches. Despicable attempts are made in Parliament to launch witch-hunts (read Parliamentary Select Committee probes) against the judges who do not pander to the whims and fancies of the politicians intoxicated with power. Some MPs and ministers abuse parliamentary privileges to vilify the members of the judiciary to their heart’s content. Public confidence in the AG’s Department has eroded severely over the decades thanks to political interference and the subservience of some of its bigwigs. There are intrepid officials who carry out their duties and functions without fear or favour, and it is they who can restore public trust in the AG’s Department. Hence the need to ensure that the government will not catapult one of its lackeys to the post of AG.

President Wickremesinghe never misses an opportunity to liken himself to Grusha, the protagonist in Brecht’s The Caucasian Chalk Circle, and expects the public to act like Azdak, the wise judge. Grusha embodies justice, righteousness, goodness, and leads a life of selfless moral rectitude. How come Ayesha has been denied her due place?

We are told in The Caucasian Chalk Circle: “Things should belong to those who do well by them; children to motherly women that they may thrive, wagons to good drivers that they may be well driven and the valley to those who water it that it may bear fruit.” There is no reason why the post of the Attorney General should not go to Ayesha. We, like many others, cannot think of a better person. If Azdak were around, he would definitely nod approvingly.

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