‘Reform’ is not a synonym for unbridled consumerism. There are values beyond money and markets too
I read with mounting concern the Prime Minister’s statement lamenting this “mindless atmosphere of negativity and pessimism that is sought to be created over … corruption” which, he holds “can do us no good”.
My worry, though, is different. For one, this is not our good PM’s style. ‘Off target’ he is often; but acerbic? No, not that. If he has changed his style then our worry is limited. If, on the other hand, some able (sic) speech writer gave him this tautological hyperbole to declaim, and the PM simply did so, then our concern takes altogether a different hue and that shrill epitaph — “mindless” — boomerangs to the declaimer, which is not at all a happy consequence.
Our country’s polity, Mr. Prime Minister, is comatose and has taken the economy with it. I urge you, therefore, to get Raghuram Rajan, (who features in the same issue of Foreign Affairs) to do an executive brief of Why Nations Fail: The Origins of Power, Prosperity and Poverty by Daron Acemoglu and Jame Robinson. The former is an economist like you; his co-author Robinson, a political scientist. They believe that “economic development hinges on a single factor: a country’s political institutions”, in other words the ‘political atmosphere’.
In the context of the prevailing “atmosphere”, therefore, I invite the PM to reflect on my theory of “reverse jurisprudence.” Unlike our inherited philosophy of “innocent until proven guilty”, in public life, unfortunately, “if accused, you will be treated as guilty until you prove yourself as innocent.” Decades ago, I had shared this very thought when Bofors had invaded our polity; I am greatly saddened that I have to do so again.
Amongst several I now choose three factors as the prime contributors to our political travails generating this “atmosphere”, about which the PM complains. But first, Mr. Prime Minister, who has fouled our political “atmosphere”? The “corrupters” or the complainants? Then this novel “political experiment” inflicted by you and your “mentor”, which is really a “mindless diarchy” of shallow convenience. It is this that today pushes the country towards “negativity and pessimism”. As for that rather despairing conclusion it “can do us no good”, I agree. But the cure, too, is not so difficult, provided you diagnose as I do.
The other factor wounding our polity is your disconnect with the people of India. Why try and deceive us by these claims of being a resident of Assam? Such prestidigitations rob the head of the government of moral authority, without which you cannot govern.
And equally critical is your neglect of Parliament, as also the institutions that it spawns. Of course, as advocated, “the government must have its way, but the opposition, too must have its say”. Find an equilibrium. It is your duty, not the opposition’s. You are the head of the government.
Which takes us to our second great concern of the day: “the state of our economy.” There, above all, I make one request. Please, do not mislead us, the economically uneducated, about what constitutes ‘reform’. It is not administrative correctives that can ape the real.
I share, therefore, four concerns on the economic front.
Firstly, the economic philosophy of the Congress party: to what do you now really subscribe? At the 1931 Karachi session of the Indian National Congress, the ‘socialist pattern of development’ was declared as the goal for India. This lay at the core of Jawaharlal Nehru’s economic philosophy. Then, after independence came the 1955 Avadi meet of the Congress and a reiteration of the ‘socialistic pattern of development’. A year later, the Indian Parliament too adopted this as official policy. Thereafter, we skip many decades, also many intervening events until the word ‘socialist’ got adhesived to the Preamble of the Indian Constitution, in 1976. This was a by-product of that fraudulent Emergency of 1975.
But I move too fast because in between, as the swan-song of our first Prime Minister, Jawaharlal Nehru, came the amendment of the Congress party’s constitution, in 1964, in Bhubhaneswar. This is where Nehru suffered a stroke and within four months, his life was over. I was then a soldier, on a tank gunnery training course in the U.K. and learnt of his death, with great sadness, from an Englishman. But this dip into memory is not central to our enquiry. The amended Congress constitution stated: “The object of the Indian National Congress is the … establishment of a socialist state…” This is now but memory, despite the addition, at Panditji’s suggestion, of a footnote: “The (above) amendments demand a more vigorous party organisation at every level for achieving socialistic state,” etc.
We come then to 1991, and late Premier Narasimha Rao’s coalition government. He fathered the ‘reform’ process, of which Dr. Manmohan Singh has now become the stepfather claiming sole credit for it. The wags were right, after all: paternity can always be disputed.
Of these ‘reforms’, fiscal management of our economy was the obvious and correct priority. No marks for guessing whose profligacy caused it in the first instance. But it was in 1991 that the country moved away from the Congress party’s “socialistic pattern” to a “free market” economy. Of this transition I am reminded of two aspects. The first was the then Finance Minister Dr. Manmohan Singh’s justification amongst others, on the grounds that the economy then had developed “structural faults” (which it had); and had become a ‘rentier’ economy (or words to that effect), generating unacceptable levels of “crony capitalism”. The other was the great scandal of the ‘Banking and Securities Fraud’. I remember, as a member of that parliamentary enquiry, having then commented that “freer the markets the stronger must be our regulatory mechanisms; and that free markets are not any excuse for a free for all”.
Therefore what, after years of reform, is our state now? No more ‘crony capitalism’? Or an abundance of it? You now say “reforms have increased corruption.” Why? Also please concede that central to this “reform process” was a moving away of the government from its stranglehold on the economic vitality of the country.
Other aspects of getting the state off the citizen’s back and vacating space for releasing the citizens’ energies mandated freedom from the thraldom of petty bureaucracy; drastically reducing discretionary powers of the political and other executives; of sane and non-expropriatory tax policy administered with patent honesty; of encouraging domestic savings, thus domestic investment; and freeing our banking from the States’ mismanagement; plus attending to our farmers. If we do this, money will flood India as investible foreign direct investment, not hot funds chasing short-term gains. Getting the “state out of the business it has no business to be in” is true reform; selling assets of the state, for correcting consequences of fiscal profligacy, through misdirected disinvestment is not.
In any event, as commented upon by Sydney Merlin in the ‘Quarterly Journal of Economics’, the word ‘privatisation’ first entered academic literature to describe the Nazi party’s policy at “facilitating the accumulation of private fortunes … by its members…” This has disturbing similarity with UPA-II policies; witness the proliferation: 2G, Commonwealth G, Coal G and so on. This amounts to stripping the assets of the state, not a healthy moving away of the state from superfluous and inefficient non-activity.
One more caution about ‘reform’. This is not a synonym for unbridled consumerism of a variety which is alien to our cultural ethos. It is distressing in the extreme to witness today, as Avishek Parin has observed, that “we purchase to consume incessantly, even as (what we purchase) consumes us back with its spectacular superfluity”. We must not become a consumerist society; Walmart, Sears-Roebuck and their ilk are not our yardstick of economic progress. There are values beyond “money and markets,” too.
I conclude with a request. Do please heed our cautions, dear Prime Minister; a government, any government, based on this variety of diarchical ‘concentration of power’; unchecked privilege and usurpation (destruction?) of our Republic can simply not do good, or survive. I pray that in the process, it would not inflict such wounds on dear India as would take long to heal. For, surely, you recognise that India, despite venerating daridra narayan suffers a wide chasm separating our poor from the rich.
(The writer is a Member of Parliament.)