"Temples Of A Possible India", 'The Hindu Business Line', January 5, 2014


Temples of a Possible India

Pulapre Balakrishnan

In what must be a record of sorts the Aam Aadmi Party (AAP) had made eighteen promises, no less, to the people of Delhi. Even the ingenious Indira Gandhi could think up only a ten-point programme when she had started out. Scepticism must abound when we reflect on the chances of their fulfilment, but two of AAP’s promises, relayed by the media, have such potential to transform India that we ignore them at our peril. These are the promises of building 500 new schools and hospitals, respectively, in Delhi within one year. Apparently there’s nothing small about this new party on the political firmament.  But the promise is of more than mere numbers we find. Delhi’s government schools and hospitals are to provide services of a quality comparable to that in the private sector. As Delhi has some of the country’s best schools and hospitals this is indeed a radical proposition. And though Mr. Kejriwal himself appears undaunted by the challenge this would entail, we would be advised to appraise them before exulting in the promise.

            First there is the question of the resources at the government’s command. Five hundred schools and hospitals is a very large number. We also know that some of the water being paid for till now is o be supplied free of cost henceforth.  Whether the lowered electricity tariff will involve some outgo from the khazana is not yet known. AAP have not considered it necessary to talk of public revenues, and have no real plans for wealth creation. One of the uses of wealth creation is that as incomes are generated in the process public revenues also increase. It is this alone that allows a government to finance its welfare schemes. A case in point is the internationally acclaimed welfare schemes initiated by Inacio Lula in Brazil. It is overlooked that Brazil has a very high tax GDP ratio in comparison to India and that its flagship welfare programme, the Bolsa Familia, constitutes a very small share of the government’s budget. Most importantly, it is conditional and meant only for the poor. It is not clear if Mr. Kejriwal has given all this much of a thought. 

If they care to look, AAP would find many economic models from around the world to choose from. They could for instance go with the Scandinavian countries which do a remarkable job of providing public services while running a tight ship. Their citizens enjoy high quality health and education provided by government combined with benign macroeconomic outcomes, among which are a government budget usually in surplus and so the balance of payments. Inflation is low despite widespread unionisation as the state negotiates between the parties. These economies also register globally high levels of per capita income. Surely they must count as an aam aadmi paradise. I am not sure that they enjoy free electricity and water though. This is highly unlikely, as Scandinavians are most environmentally conscious. Are there no desi models you might say? So, we may as well adopt the popular trope of comparing Gujarat and Kerala. surely cannot be a model for AAP under any circumstances, though it must be acknowledged that NaMo is a wealth creator alright and has some nifty ideas on tapping solar energy. What about Kerala then? Sure, Mr. Kejriwal may want to get his boys to cross the Vindhyas for a recce. They would find that though talked up to an iconic status for the quality of its public services, Kerala is not a shining example of the public provision of health and education. It has the highest proportion among all states in the country of school-going children in private schools, suggesting that Kerala’s aam aadmi does not think much of its government schools. But it is a review of health facilities in Kerala that should lead Team Kejriwal to shed the belief that the private sector’s practices are to be emulated at all. Over the past four decades medical practitioners have emerged as an egregiously wealthy class. This has been made possible by the  corporatisation of medical services and the associated pursuit of dubious practices such as insistence on a battery of tests for every ailment. The psychological coercion of patients into surgery is an aspect of this. We have long known of the rising incidence of the caesarian section in childbirth, but there is reason to believe that Kerala’s private medical establishment may even have created a market for the bypass in cardiac surgery. To economists this is no surprise. They have long recognised that the market for health is prone to failure, the reason being the asymmetry of information between the patient and the practitioner. That is, the patient can never know as much about the nature of her ailment as the doctor. The result of this is a high price and sub-optimal provision of health. The answer to this is regulation and not the replication of private-sector practices in the public sector.  It is of course always a challenge to ensure that the industry does not capture the regulator.  

            Though public revenues are important in general and likely to be a very crucial factor to an agenda of expanding the state school sector by 500 schools within an year, it is important to recognise that much can be achieved even without more funds. Cracking down on teacher absenteeism, opening up schools and hospitals to social audit and making the workplace less bureaucratic are all ways in which the public sector can be made to function better. Here the mantra for the crusader on behalf of the aam aadmi dependent upon public provision of health and education is “governance, governance, governance ….”.

            Cynics put out that AAP have not given too much of a thought to the issue of governance. This may well be true, but could well turn out a poor predictor of their failure. After all, M.G. Ramachandran had spent all his life on the silver screen before ending up as the Chief Minister of a state much larger and poorer than Delhi is today. This did not prevent him from being quite successful, especially in introducing competition into the political system of Tamilnadu. In fact, Tamilnadu’s relentless rise as an economy more or less co-incides with his last avatar. And after all, Mr. Kejriwal has experience in government, and knows a thing or two about both engineering and accounting, which is more than can be said for many of his fellow MLAs. 

            For Mr. Kejriwal and his party the time for expressing outrage over corruption and promises is over.  It is time to build now, and their task is cut out. It is not going to be easy to get the water pipes humming, fix the sewerage or govern teachers bunking class. But AAP have brought to the high table of Indian politics a brand new discourse. “Schools before flyovers” its PWD Minister is said to have answered a pesky reporter while travelling to a meeting on the Delhi metro. They have alerted their fellow citizens to the temples of a possible India. Move over apparatchiks hawking rights or purveying a rancid nationalism!