"Prediction is very difficult, especially about the future." Niels Bohr.
On the contrary, we are generally smug about our ability of understanding the past. It is common wisdom that Dr Manmohan Singh and Mr P Chidambaram were the architects of India's economic reforms. Is it really true? As I watch the events unfolding before us, I am inclined to think otherwise. Ask a student who has studied Economics 101, he or she will know all about what is to be done if India is to progress in all spheres of development. The critical issue always hinges not on WHAT TO DO but on HOW TO DO!
Ideas are dime a dozen; pay a rupee to any mediocre thinker and you would end up with ideas worth a hundred rupees. The game is all about implementation. Knowing what to do does not even put us on the starting block. Having known what to do, how much are we ready to stake in getting them done? In PV Narasimha Rao, we had someone who put his money where his mouth was. Politics is the art of achieving the possible and not what is ideal. With the type of contradictory political pulls that are typical of a noisy and dysfunctional democracy that is India, it requires limitless patience, political skills and perseverance to achieve what one sets out to do. Giving up is the easiest of options; talking what the chatterati want may win brownie points but all good intentions come to naught if the matching ability is not there.
So, to whom do we credit whatever economic reforms that happened in 1991? Dr MMS appears too spineless going by what has happened since 2004. The powerless and supine nature of the good Sardar appears in stark relief to the political ability of PVN especially so when we compare their situations. In fact, the situation in 1991 was dire, the compulsions of coalition politics were more severe and PVN lacked a political base. He was a Prime Minister by default when he assumed office and he was also discredited in 1996. To add insult to injury, till date, the Congress treats him as almost an aberration. No Congress leader worth his or her name, dares to attribute any credit to PVR. All that we hear from the so called intellectual elite and the press is about how MMS and PC steered the country from a near disaster in 1991.
Probably the story cannot be more different that what we have been led to believe; Seeing the rudderless state of the Indian State, I am convinced more and more as days pass that the true credit of changing directions should be attributed to PVN completely. I am sure, with MMS or with any one with a reasonable understanding of economics, PVN would have still achieved the same result; perhaps, better. The politician in PVN just needed an intellectual figurehead for the sake of credibility and any one would with some reputation of intelligence would have equally fitted the bill. Misrepresentation of history has bequeathed a supine and pusillanimous MMS because of a mis-attribution of credit. It is noteworthy to remember another prime minister, Mr Atal Bihari Vajpayee who led a government under similar circumstances. In my opinion, history would be more charitable in future about the contributions of this remarkable individual who did more than what we think. The financial cushion for social expenditure of UPA - I can be completely attributed to responsible governance of ABV. Again, it was the right man at the helm who mattered, namely, ABV.
It is time the media and the chattering classes get out of their delusions about MMS and PC being the reformers. The true credit lies elsewhere and the earlier we understand it, the better off we would be.
My understanding is PVN was busy looting the country. Was he hands on with financial reforms? Are you trashing MMS and PC just to look different and cool or is this based on facts? if so, what and were are the facts?
ReplyDeleteSrini Natarajan, USA.
Please read my article carefully once again. I have not made any claims of PVN being honest or otherwise. Probity in public life is a relativist position. And for saying that he was busy looting the country, do you have the facts either? If you indicate the urea scam or harshad mehta or bribing JMM MPs, I can show you many more which have happened under Dr MMS/PC combination which are vastly larger in scope and scale. If you intend forgiving MMS because of perceptions of personal integrity, it may be an indicator of incompetence for many others. If a student is good in maths and got brilliant marks in many exams earlier, and then, is failing consistently in many more exams which happen later we have to now discount the student ability first and start looking for other enabling factors that made the student shine. Similarly, if MMS is to be viewed as the architect of economic reforms in 1991, where has that MMS gone now? If as a mere cabinet minister he was credited with doing so much, then as a prime minister why has he done nothing except presiding over a government which has been fiscally irresponsible, been a source of multiplicity of scams with each one staggeringly larger than the previous one and with every passing day, gives the impression of a deer trapped by the headlights of an approaching car? If we have to trash people because of corruption, then let us start naming those who still merit our praise. I am sure that fingers of one hand will be surplus. It may be cynical on my part to say this but if I have to choose between a thief who takes his share but leaves enough for others and an incompetent honest person who leads a gang of thieves bent upon leaving nothing for me, whom should I choose?
ReplyDeleteIncidentally, giving credit to PVN is not a very politically correct view point in India even today.
Let us agree on one thing, that all politicians are corrupt. Now to the essence of your blog, which is VPN deserves credit for the 91 reforms because MMS is not able to get anything accomplished as a PM. Granted, I am no expert on Politics or finance of 91. You cannot just see the political situation alone of 91. India had the ignominy of sending gold to IMF to pay for imports. Under those circumstances you don't have to be politically savvy to get everyone on board for fiscal reforms. It was a dire need. You can use the same argument against giving any credit to MMS. Nevertheless, its hard to give any credit to PVN, since, it appears to me, it was the expediency of circumstances which resulted in the reforms.
ReplyDeleteThere are always expediencies and there are always options for doing things at the time of such expediencies. Not every option works but to take the right call needs sagacity. If I look at your argument that solutions are easier to implement because there are crises and no one deserves credit for implementing the right solution, the logic is difficult to digest. Crises keep happening in many countries and history is witness to them. By your logic, FDR should not be given credit for the new deal, whatever Hitler did was right due to the dire circumstances of Germany in 1933, Argentina should not have been a basket case because of the same reasoning and Greece of today should have found the right solutions.
ReplyDeleteTry to look at this issue from another perspective. During difficult times, exercising hard options is not easy. Populist but economically irrational solutions are the easiest of options to sell. Take the example of Zimbabwe. This country is resource rich but nothing seems to happen right. Or look at Venezuela of today, Mexico of the 90s to see my logic. Indian economy of 2012 is also a prime example of how to squander a great opportunity created by the sound economic policies of the NDA government of ABV. Look at the unseemly political drama that is happening today over the Rail budget where economic rationale is being defeated by political expediency. Crises can engender both statesmen and demagogues. Between the two, statesmanship is a difficult choice whereas demagoguery is the easy one. PVN chose the former whereas people like Chavez choose the latter. Common people are generally clueless about the long term consequences of populism. To do the right thing costs votes. If economic reform was the right choice of the 90s in India, Congress should not have lost in 1996 and neither should the BJP in 2004.
I can also argue that the loose monetary policy of the US Fed is likely to cause immense pain to the US when the time comes to remove the steroid of money creation. US is likely to face embedded inflation which will be difficult to stem when some growth takes hold. High unemployment in US is likely to become structural over the long term with a deadly combination of inflation, low paying jobs and a prolonged period of fiscal deficits which are likely to threaten the very economic foundations of a vibrant nation. The policy choices may seem clear but try selling it to the voters!
The gist of my arguments are these. In times of hardship, it is more difficult to make the right policy choices which cause pain in the short term but are likely to prove beneficial in the long run. It requires political courage and not academic brilliance to get things done. MMS shows a distinct deficiency of the former.
An interesting insight and I always wanted to understand why the knight in shiny armour fizzled out later on in UPA1/2. PVN probably is most understated PM and was known only for suitcases and shuteyes...nice piece Shankar
ReplyDelete