Internet media: emerging as the people’s media

On March 3, 2005, Martha Stewart was released from jail after serving five-month for her involvement in insider trading. On being tipped off by Sam Waksal, the CEO of ImClone, Ms. Stewart sold 3928 of her ImClone shares only the day before the company disclosed to the market that FDA had rejected its cancer drug application. Had she waited few days, she would have lost about $80,000. Facing potential loss, she resorted to unethical behaviour to save only a few thousand bucks.

Her action landed her not only in jail, but cost her in thousands of dollars in fines and legal fees and $280 million in capital lost due to decrease of her stock prices. This case shows how synergy of formal (legal) and informal institutions (market, press and civil society) can effectively punish unethical behaviours of individuals, regardless of their social status.

Au contraire, no such synergy appears to exist in Bangladesh. Consider, for example, the issue of stock market debacle which led to the shut-down of Dhaka Stock Exchange on January 10, 2011. Only few days to the crash, thousands lost billions of taka due to alleged manipulation of the market. A committee was later formed to investigate the massive fall of stock prices. But, the outcome remains to be elusive.

The crash may be the results of 'irrational exuberance' or market manipulation or something else. Regardless of the cause, the government as the trustee should have investigated the crash and taken action to rebuild the confidence of the investors. But, apart from letting the small investors kept waited on hopes that something would happen, nothing else did happen (On August 17. 2011, Dhaka magistrate court summoned five investors to appear in court by October 17.) The government seems to have made a conscious choice not to dig the hole any deeper and let the matter lapse from people's memory.

Now, for a moment, assume that the market crash was indeed the consequence of an act of manipulation. Does any mechanism exist in Bangladesh to hold the people, suspected of causing the crash, responsible?

Few informal mechanisms do indeed exist, but each seems to be losing its efficacy in enforcing accountability.  For example, three institutions, namely the electoral process, free press, and vibrant civil society, evolved since 1991, have played crucial role in holding the powerful accountable. Especially when evaluated in historical context, only then one would appreciate the contribution of these institutions in empowering people. The truth is that no such mechanism did exit during the 15 years of military rule.

But, as I said, these institutions seem to be losing lustre in enforcing accountability. Electoral process is being influenced by the moneyed interests, dominated by social and familial connections, suffered from lack of information and reform and subjected to feudalistic attitudes of the national leadership. Press and civil society groups are getting ideologically polarised and being dominated by the moneyed interests. Just consider the recent incidence in the Supreme Court. Unlawful behaviours of a few lawyers trying to derail a trial process show how partisan interests prevail over the respect for the institution of laws.

By contrast, people with money and power seem to be realising the virtues of information and strength of media in defending their interests from populist pressures. Indeed, they are doing what any other group would have done; buying up media and dividing civil society groups. But, with media being dominated by a few groups, individual interests are likely to prevail over public interests.

But the cloud of dismay is soon to transform into the brightness of hopes: the internet are about to dismantle the monopoly of the powerful on information sources and empower people with a new accountability mechanism. From Tunisia, Egypt, Libya to Syria, everywhere, people felt the ethereal presence of the internet when no one else could stand against the fury of the government forces. It acted as a catalyst to drown the Goebbelsian propaganda machines of the despots, garner international support, build an alliance of free-minders, and bring down three omnipotent despots.

But, would not emergence of electronic media require communication infrastructure, which, in turn, has to be provided by the government, also heavily dominated by the special interest groups? Why would the government be willing to provide infrastructure that may jeopardise its own existence? Well, internet media would emerge as an unintended consequence of government action: to survive global competition, government faces no choice but to improve communication infrastructure.

And, as long as democratic process, albeit dysfunctional, continues, the internet would surely emerge as the dominant media and empower people with better information and capacity to hold government responsible for its inaction.

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ABM Nasir is an Associate Professor of Economics at the North Carolina Central University, USA.