Recent elections have again brought into sharp focus the promise of freebies ahead of polls as an electoral strategy. It all started in the sixties, with the then CM Annadurai promising rice at Re. 1 per Madrasa measure (less than a kilo). The Southern states pioneered the reservations but that did not affect administration and governance. Similarly the freebies culture in the country comes from the south. MGR, M Karunanidhi, J Jayalalitha and NTR have all been past-masters at that. That culture has now travelled above the Vindyas. Can the northern belt sustain such a culture, as RBI now red flags even Kerala and AP? The economic cushion which the southern states had at one time is withering away. The RBI has found spending on freebies by Jharkhand, West Bengal, Rajasthan, MP, Bihar, Haryana and Punjab unsustainable
AAP has benefitted electorally by promises of free electricity, free water and medicines. The victories of Congress party in HP and Karnataka were tom-tomed as a result of guarantees. The guarantees may have played a role, but to attribute the victories to guarantees only would be an insult to the electorate and the party workers.
Earlier it was sarees, colour TVs, mixers, grinders. Then came cycles followed by scooters. The twelfth standard pass outs at the age of 17/18 are on the verge of voting get promises of free laptops. Jayalalitha provided free laptops to all students studying in Higher Secondary schools West Bengal free tablet scheme 2003 gave 9.5 lakh students from 36000 Government, and Government aided secondary schools 14000 Higher secondary schools and 600 madrasas will get free tablets.
In the last round of 5 assembly elections both sides competed with each other in bettering their pre poll offerings. What financial damage shall be caused, if such promises are implemented has not been calculated. After coming to power, even if there are no resources, money would have to be raised through borrowing, increasing the debt of the states. The financial catastrophe from unchecked fiscal deficit can only be delayed by more borrowing. The burden could be delayed by further borrowing and thereafter, passed down to the next government or the next generation. Who cares? Why should the next generation be burdened by the previous one? What free services and increased expenditure can do to the financial health of a state has been demonstrated by Sri Lanka!
The PM who spoke of the ‘Revdi’ culture, himself announced free ration for 80 crore people on the eve of state assembly elections for a period of 5 years, at the cost of two lakh cores Rupees every year, even before the cabinet approved the scheme. A country positioning itself as a third largest economy, to provide free food for to over 57.5% of its population shows that something is terribly wrong at the governance level.
Social equality is the fundamental principle of our constitution and any public spending on the marginalized would be legitimate. The public distribution system providing subsidized essential commodities is great. But those not needing it must be weeded out. Subsidized employment guarantee under MNREGA for rural and urban poor for fixed number of days is a great amelioration to the unemployed.
The marginalized actually get their earnings in an extremely dignified manner. Good infrastructure, excess to health and education even beyond the financial capacity of the states may be tolerated. There is always a thin line between a programme designed as a social justice measure to help the needy and a policy as a electoral strategy. The practice of making promises without financial support is a disease difficult to avoid in competitive electoral politics as welfares is never looked with fiscal prudence at election on time.
The welfare policy of the government in power has the sanctity as the budget gets the approval of the parliament. Since the elections to various levels are on all the times, some promises have to be implemented, despite fiscal difficulty, to show-case their performance in another state or at next elections. To hell with the economy! Politicos are hardly bothered about the impact of fiscal imprudence on the economy. Larger interests of country, to interest of lager economy or public debt are never looked at election time. Winning is the only motto. Bodies like the Law Commission or Finance Commission, established for specific purpose are seen as extensions of the party in power and also cannot be given a role in taking decisions on such promises by the parties at election time.
The government has to call to take a call on ‘survival’ and ‘revival’. Whatever has to be done for citizens to survive has to done at whatever cost but revival of the economy has to be the end goal. That can be done only with a long term perspective. Short term goals of wining next election can do long term damage.
The great U.S. depression of 1929 has lessons for the world. When unemployment rose as businesses failed, hunger and malnutrition became the order of the day, people put their hope and trust in Franklin Roosevelt in 1932. The state administration came with banking law reforms, emergency relief programmes, work relief programmes and agricultural programmes. Lakhs of young men were put on work on conservation and construction projects, improving bridges, roads, and savers and refurbishing schools and hospitals. That brought a turnaround in the economy. UPA’s MNREGA and Vajpayee Government’s Gramin Sadak Yojana are in that direction. We require statesmanship. Populism is only a race to the pit!
Two decades back the parliament brought in Fiscal responsibility and Budget Management Act 2003 for ensuring inter-generational equity in fiscal management and long term macroeconomic responsibility. The law is only gathering dust.
(The writer is a practicing advocate and a political thinker)
