In the Indian commentary provoked by the Panama revelations, did you read anywhere that the lesson is that it is dangerous to give officials unlimited charge of creating wealth? Did you hear anyone say that it is dictators and leaders of totalitarian countries like Russia and China that hide their ill-gotten riches in tax havens? I did not and you will not either because, for the most part, we political pundits remain Nehruvian socialist in our economic mindset, so we become hysterical if Vijay Mallya fails to pay Rs 9,000 crore back to the banks but we are sanguine about Air India’s losses of Rs 40,000 crore. And even more sanguine about the vast amounts of taxpayers’ money that continue to be poured into unprofitable public sector enterprises. This is money that would have been much better spent on improving our disgraceful government schools and appalling government hospitals, but we prefer not to get into that discussion.
Ideological blinders prevent us from noticing that if officials and politicians had not had total control of our investments for decades, some of our poorest states would not be poor. We hesitate to acknowledge that the only prosperity India has seen came when the licence raj ended and Indian industrialists were allowed freedom to grow their companies and create jobs and wealth. Within a decade, despite the constraints of shoddy infrastructure and a half-skilled workforce, Indian companies showed that they could compete with the best in the world.
If some of our best companies are in dire straits today, it is because the Sonia-Manmohan government in its last years in office started treating businessmen once more like criminals. Since by then jobs had dried up and the economy had gone into a downturn, public opinion turned Nehruvian socialist once more. Some of the leading lights of Anna Hazare’s movement lent raucous voices to the cry against ‘looters’ looting the resources of the people.
Is it not time to start asking who the real looters are? Is it not time to start questioning why every enterprise run by officials ends up in the doldrums even when economic times are good? And most importantly, is it not time to ask what kind of money oils the wheels of our election machinery? If there are those who believe that this is ‘white’ money, they need their heads examined. But these are things we do not talk about in our ancient land because the idea that great leaders like Jawaharlal Nehru and Indira Gandhi could have been wrong frightens most Indians. It shakes the very foundation of their faith in this country, so even a powerful Prime Minister like Narendra Modi has so far hesitated on his Mann ki Baat to explain to ordinary Indians why economic reforms are necessary.
During the 2014 election campaign, he said often that it was not the business of government to be in business, but after becoming Prime Minister, he has been much more cautious. With his extraordinary oratorical skills, it should be easy for him to say what the Governor of the Reserve Bank said in Mumbai last week. This is what he said in the context of the Panama papers, ‘Increasingly, this talk about whether entrepreneurial wealth is illegitimate, whether self-made people should have what they have and whether that is fair game. I think this is dangerous.’
It is important for the Prime Minister to say this kind of thing repeatedly because only if he does will he be able to change the ‘socialist’ ideas we have been bequeathed. He needs to use his conversations with ordinary Indians to explain to them how they have been fooled into believing that it is because some Indians are rich, that the vast majority are forced to live on less than Rs 20 a day. The real reason why India has remained mired in horrific poverty is because of an economic philosophy that has failed everywhere.
If India remains today a country in which more than half our people live in hovels instead of homes and live without clean water and electricity, it is because instead of governance, our political leaders and officials have been busy doing business. Some have been very successful businessmen, and I had hoped that the Panama papers would reveal their names or the names of their friends and family members. This would have gone a long way towards making ordinary Indians understand who the real looters are. They sense this anyway because no sooner does one of their own finds his way into Parliament or into a state Assembly, than they notice how his lifestyle instantly improves. They notice how he begins to live in a fine house and how his progeny drive around in fancy cars. They are too economically illiterate to ask questions so they express their rage at election time.