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Ballot bailout

Making the case for populist measures, a Congress leader pointed out that measures aimed at alleviating poverty at a significant cost to the exchequer are often branded populist, with the pejorative connotation in clear sight, writes Suhit Sen.

india Updated: Apr 02, 2009 15:47 IST
Suhit Sen
Suhit Sen

It was the Congress that kicked off the war for the vote with a slew of ‘populist’ promises in its manifesto, the centrepiece of which was the assurance of providing 25 kg of rice at Rs 3 per kg every month to families below the poverty line. Within 24 hours, the BJP promised it would not be far behind — its manifesto is still in the works, but cheaper provisions have been unofficially mooted.

Quite apart from the fact that the Hindutva brigade’s scramble to catch up exposes its priorities — we recall that the matter of focusing on issues like the Ram temple at Ayodhya had already been cleared on a priority basis — there is the question of the legitimacy of this kind of election-centric populism in a democracy. Middle-class India, including, by and large, the intelligentsia, tends to frown on such populism, but the political establishment has a fairly cogent defence.

Making the case for populist measures, a Congress leader pointed out that measures aimed at alleviating poverty at a significant cost to the exchequer are often branded populist, with the pejorative connotation in clear sight. But an important part of the mandate of any government, and, therefore, any party or alliance aspiring for power, must be the alleviation of poverty, especially at the margins. The redistribution of resources towards the most vulnerable people can hardly be criticised as populism. He had a point, though what he left unsaid is equally important.

Let’s begin with the case for populism. It’s populism when agricultural loans are written off or subsidised meals provided to the indigent. But when fat cats in steel, aviation or automobile sector ask for, and get, bailouts and write-offs — a helping hand from the government in whatever form — it’s macroeconomics. It’s important at this juncture, from the point of view of a global downturn-hit economy, that the State puts in place measures to stimulate aggregate demand, keep the flow of investments moving and keep productive capacities at as near full employment as possible, even if there cannot actually be an expansion of those capacities.

It is equally vital that those hit most by the crisis or those whose chronic lack of the fundamental entitlements of life are only marginally, if at all, affected by boom or bust, be provided the shelter of the State. Because they are the most vulnerable, and are also the least able to fend for themselves.

The critics of populism had already been muttering darkly about unacceptable levels of fiscal deficit and the lack of fiscal responsibility when the outgoing finance minister announced a stimulus package after the vote on account in February. They will be even more perturbed at the commitment to expenditure that such electoral promises entail, if implemented, and what it will do to the budget, the deficit and legislated commitments to fiscal responsibility. But just as it is incumbent on governments to pursue expansionary economic policies in an attempt to climb out of the downturn rather than cleaving to economic orthodoxies, it is also incumbent upon them to pursue broad objectives that have to do with achieving a measure of social justice at all times, even if that involves flying in the face of doctrinaire prescriptions about how to run the economy. These, in any case, can hardly be said to be infallible nostrums, whatever the mandarins of multilateral institutions may want us to believe.

Having said all that, there is the question of the important bits politicians and demagogues tend to leave out. And that obviously is the implementation part. We all know that as with the midday meals in schools, the National Rural Employment Guarantee Scheme, the public distribution system, the kind of schemes the contesting parties are promising will lead to massive resource leakage. At least as much as the intended beneficiaries, a motley crew of politicians, bureaucrats, facilitators and contractors will benefit as subsidised rice, or whatever, makes its way into the black market. But, needless to say, the prospect of such leakages can hardly trump the duty of the State and the prospective bearers of State power to commit themselves to the welfare of its citizens, as a starting point.

When we examine the question of the legitimacy of populism as policy, in this case at least we must also deal with the issue of timing. If parties as prospective bearers of State power are to commit themselves to social justice and welfare, broadly speaking, shouldn’t we smell a rat when it gets an airing only before an election, being implemented after a fashion on the assumption of power or forgotten expeditiously? The obvious answer is yes. But what need not be rejected summarily is that populist electoral promises, whatever their fate later on, are entirely legitimate if only because they symbolise a set of liberal and egalitarian values that are, or should be, at the heart of the political covenant that binds the governor and the governed.

Suhit Sen is a Kolkata-based journalist