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It’s Raining Populist Freebies:ECONOMIC COST BE DAMNED!,Poonam I Kaushish,28 March 2009 Print E-mail

POLITICAL DIARY

New Delhi, 28 March 2009

It’s Raining Populist Freebies

ECONOMIC COST BE DAMNED!

By Poonam I Kaushish

It is raining freebies in this mad season of elections. Wherein sound economic sense has been surrendered to political gamesmanship. Reckless promises are being made by all parties with gay abandon, on the assumption that populist promises yield better electoral rewards than reasoned issues and sustainable programmes. Who cares? After all promises are just promises. And Government money is nobody’s money!    

The populism political parties indulge in would, indeed, be comic were it not for its future consequences for the country. None sees the danger of political disintegration and economic derailment. Tragically, in this nautanki of one-upmanship and populist bravado all expose the hollowness of their political commitment. Dismissing as nonsense the economic logic that there is no such thing as a free lunch as all merrily dole out wages of populism.

Leading the pack is none other than the Congress. It pledges to shower 25 kg rice at Rs 3 per kg on its aam aadmi, read BPL families. Along with a promise to set up subsidized community kitchens for the homeless and migrants, health insurance cover for the poor and supply bijli  at affordable prices. No matter that the Government would need to borrow over Rs120000 crores. And never mind its commitment to the path of fiscal responsibility. Sic.

Not to be outdone the BJP too joined the pro-poor chorus. Upping the Congress offer of rice at Rs 3 to Rs 2 per kg for BPL homes and at Re 1 per kg for all antyodaya cardholders. Specially, as its ‘rice politics’ had led to the Party returning to power in Chhattisgarh last year. With women comprising half the electorate, it also pledged to replicate the Madhya Pradesh Government’s “Ladli Laxmi Yojana” to the rest of the country.

True, it can be argued that political parties are obliged to be seen as populist. In this no-holds-barred free-for-all electoral race, it would be foolish and stupid to wish away political lollipops to entice the electorate. But the point that needs to be stressed is that political promises in the economic sphere should not cross the prudence limits, where it starts hurting the economy as a whole.

To put in another way, assurances of providing cheap rice, wheat or free electricity can be justified on a variety of grounds. Acute poverty is one. Aren’t such concessions imperative in a country where 40 per cent of the people live below the poverty line and over 700 million earn less than Rs 20 a day. Is it not the duty of our jan sevaks to take care of the welfare of its people?

Sound argument. But at the same time in politics one should never mistake rhetoric for reality. Politicians of all hues cry themselves hoarse for “a better deal for the poor.” Those who asked for water have been given watershed management programmes. Those who wanted naukri have been handed over the National Guarantee Employment Scheme. For the farmers dying under the burden of debt have been guaranteed loan waivers of Rs 65,000 crore. Those who clamoured for houses have to suffice with pipedreams of Rs 25,000 houses. More and more of trees, not the coveted mangoes!

Not for our netagan the agonising reality that over 600 million hungry stomachs continue to feed on the enticing neon lights of fast foods or rummage in garbage bins for rat-infested left-over. Sleep on dirty pavements and use the sidewalks for their morning constitutional. According to UN World Food Programme latest report, India ranks 94th in the Global Hunger Index of 119 countries. With over 230 million of its rural poor being undernourished (the world’s highest) malnutrition accounts for nearly 50% of child deaths.

Besides, Election 2009 is no different from previous polls. In the last 42 years and more populism has reared its ugly head in various forms. The ball was set rolling by the DMK in Tamil Nadu in 1967 when it guaranteed rice at Rs 1. The Telegu bidda NTR Rama Rao followed suit by promising rice at Rs 2 per kg in 1983 when his newly formed TDP swept the polls in a stunning victory. Conveniently, forgetting that thanks to this there was a sharp reduction in industrial growth rate.

Then came the disastrous “loan melas” of the late eighties wherein the total subsidies during 1987-88 was Rs.42,324 crores or 15 per cent of the Gross Domestic Product. Followed by the Congress resurrecting Indira Gandhi’s ‘Garibi Hatao’ and Narasimha Rao’s “Roti, kaprah aur makan” with “Congress ka haath aam aadmi ke saath.” The BJP countered this with its BSP: Bijli, Sadak aur Paani campaign which saw it wrest 4 States.

Last year, bereft of anything knew to offer the aam aadmi, ‘rice politics’ once again took centre-stage. Wherein 6 poll-going States (Chhattisgarh, Madhya Pradesh Andhra Pradesh Karnataka Orissa and Tamil Nadu) saw parties and Governments promising subsidized rice and grain to the poor, ranging from Rs 1 to Rs 3. The electoral dividends that accrued speak volumes. The DMK returned in Tamil Nadu, the BJP retained Madhya Pradesh and Chhattisgarh and debuted in Karnataka and Congress in Andhra.

That apart, sadly none sees the writing on the wall: These populist promises are counter-productive. As underscored by the Justice Wadhwa Committee report submitted to the Supreme Court in 2006 on the health of the PDS system. Citing the Karnataka decision to provide rice at Rs. 3 per kg to BPL families, the report avers: “This has led to a mad rush among people for categorization under BPL”. It warned that “unless effective mechanism to screen BPL families were worked out, it would lead to shortage foodgrains under the PDS, which in any way is inefficient, corrupt and  reeling under massive pilferage.”

Clearly, care should be taken to draw a distinction between welfarism and populism. Welfarism takes into account the needs of different sections of the society as a part of a large development framework. Populism, on the other hand, is guided not so much by social concerns but by vote banks. It essentially implies granting certain concessions which have no economic rationale and are not part of the larger economic planning, as enunciated by the government.

The basic question that has been highlighted once again by free-falling gifts is the subject reality of grinding poverty, which continues to haunt us after 62 years of Independence. Populism will only provide immediate succour at the expense of the entire future. It is no remedy for neglect of education and health. Faulty priorities in respect of industrialization and under-investment in rural areas. Growth of corruption and a bloated bureaucracy. Over population and apathy to greater productivity. A Government cannot afford to throw away money on populist whims.

Unfortunately, our policy-makers have been unable to perceive the reality of the situation. They have consistently failed to evolve a strategy of development which would take into account our pluralism and fluctuating economic disparities.

It is time now for the political parties to realize that liberalization and populism do not go hand in hand. The aam aadmi is no fool. Each populist slogan only accentuates his growing awareness. The real significance of any electoral battle is that unless the problem of poverty is substantially resolved, violent earthquakes will continue to rock the Indian polity, whereby it could endanger our federalism and pluralism. The time to draw a ‘lakshman rekha’ on vote bank politics. ---INFA

 (Copyright, India News and Feature Alliance)

 

 

 

 

 

 

 

          

 

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