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Saturday, January 08, 2005
Post-tsunami thoughts 1: Fighting poverty
Disaster shows discretion – it is always the poor who get the worst of it. All through Tamil Nadu we have seen that it is the poor who have suffered most, a fact that has been so commented upon and so amply illustrated that I won’t bother to elaborate upon it. And from this we come to the simple conclusion: a fight to minimise the impact of a future tragedy is essentially a fight against poverty. This is a battle we are supposed to have been fighting for the last 50 years, but our forays have been so half-hearted that we haven’t come close to succeeding. Poverty is a formidable enemy, and you cannot win a war if you’re wondering what’s for breakfast.
So how do we defeat poverty? I have written about this before, and my answer remains the same: free markets, open economy, more accountable government. (Read “The myth about the rich and the poor” for my thoughts on why only free markets can bring about prosperity.) One of the people who accompanied me on some of my travel through Tamil Nadu, Nityanand Jayaraman, will wince when he reads this, but I think his environmental activities are entirely compatible with the kind of globalisation that I would like to see happen.
Companies, and this includes the chemical companies Jayaraman is fighting against, are neither good nor bad – they are amoral. They act solely on the basis of the economic imperitive, and that is as it should be. It is the responsibility of the government to regulate their activities, and that vast self-propagating bureaucratic machine that Nehru set up fails to do so, and that failure is written into its design. We love to rail against how Enron duped the people of India with the Dabhol Power Project, but should we really blame Enron for that? Shouldn’t the blame rest with the corrupt government functionaries who signed those contracts with Enron? India’s problems are problems of governance, and the vast remains of Nehru’s Fabian socialism are actually corrupting the process of globalisation, and giving it a bad name.
So how do we improve governance? The kind of work activists like Jayaraman do is invaluable – if you shout loud enough and long enough, people eventually take notice – but it is equalivalent to a mosquito attacking a slumbersome elephant. That elephant is not just the government – it is us.
To my mind, democracy and free markets must go hand-in-hand to achieve prosperity. But I would venture to say that the way democracy works in India is not the way it should. In theory, people should elect their leaders on the basis of who will govern them the best, and existing governments should be held accountable on that basis. But governance hardly matters in India, and large swathes of the country vote on the basis of caste dynamics and factors that have nothing to do with governance. Identity politics is still the most powerful force in elections.
Obviously the key to changing this is development, which will lead to more education, which will lead to more discretion in voting, shifting the focus to governance. (This is why entities that depend on identity politics, like the radical right, are against this kind of development, with all their swadeshi rhetoric.) But a vicious circle kicks in here. To get an accountable government in the true sense of a democracy, we need development, but to develop as we should, we need governance. The way in which we are moving now, limping along ineptly towards a globalised economy, is taking too long, and the poor are complaining that they don’t see the impact of globalisation, and so it must be bad.
Apart from limping along, with the pains that it involves, is there any other way out? Well, yes. If an enlightened economist could take over the government, he could accelerate the process. But are we evolved enough as a country to elect such a man? Well, no. By a stroke of good fortune, though, we have precisely one such person leading this government. Manmohan Singh could be that seminal prime minister who will turn globalisation from a negative term to a positive one, standing for equitable prosperity. And perhaps when that next tsunami comes, less people will suffer, and those who do lose their houses will have a bank account and an insurance policy.
So how do we defeat poverty? I have written about this before, and my answer remains the same: free markets, open economy, more accountable government. (Read “The myth about the rich and the poor” for my thoughts on why only free markets can bring about prosperity.) One of the people who accompanied me on some of my travel through Tamil Nadu, Nityanand Jayaraman, will wince when he reads this, but I think his environmental activities are entirely compatible with the kind of globalisation that I would like to see happen.
Companies, and this includes the chemical companies Jayaraman is fighting against, are neither good nor bad – they are amoral. They act solely on the basis of the economic imperitive, and that is as it should be. It is the responsibility of the government to regulate their activities, and that vast self-propagating bureaucratic machine that Nehru set up fails to do so, and that failure is written into its design. We love to rail against how Enron duped the people of India with the Dabhol Power Project, but should we really blame Enron for that? Shouldn’t the blame rest with the corrupt government functionaries who signed those contracts with Enron? India’s problems are problems of governance, and the vast remains of Nehru’s Fabian socialism are actually corrupting the process of globalisation, and giving it a bad name.
So how do we improve governance? The kind of work activists like Jayaraman do is invaluable – if you shout loud enough and long enough, people eventually take notice – but it is equalivalent to a mosquito attacking a slumbersome elephant. That elephant is not just the government – it is us.
To my mind, democracy and free markets must go hand-in-hand to achieve prosperity. But I would venture to say that the way democracy works in India is not the way it should. In theory, people should elect their leaders on the basis of who will govern them the best, and existing governments should be held accountable on that basis. But governance hardly matters in India, and large swathes of the country vote on the basis of caste dynamics and factors that have nothing to do with governance. Identity politics is still the most powerful force in elections.
Obviously the key to changing this is development, which will lead to more education, which will lead to more discretion in voting, shifting the focus to governance. (This is why entities that depend on identity politics, like the radical right, are against this kind of development, with all their swadeshi rhetoric.) But a vicious circle kicks in here. To get an accountable government in the true sense of a democracy, we need development, but to develop as we should, we need governance. The way in which we are moving now, limping along ineptly towards a globalised economy, is taking too long, and the poor are complaining that they don’t see the impact of globalisation, and so it must be bad.
Apart from limping along, with the pains that it involves, is there any other way out? Well, yes. If an enlightened economist could take over the government, he could accelerate the process. But are we evolved enough as a country to elect such a man? Well, no. By a stroke of good fortune, though, we have precisely one such person leading this government. Manmohan Singh could be that seminal prime minister who will turn globalisation from a negative term to a positive one, standing for equitable prosperity. And perhaps when that next tsunami comes, less people will suffer, and those who do lose their houses will have a bank account and an insurance policy.
