Losing brand equity

It would be quite bizarre if the Congress did in fact set up an economic reforms review panel without Manmohan Singh on it -- like trying ...

It would be quite bizarre if the Congress did in fact set up an economic reforms review panel without Manmohan Singh on it 8212; like trying to stage Hamlet without the Prince of Denmark. But it would not be surprising. It is the fate of good economists not to be heard in their own bailiwicks. People tend to regard economists like those daily horoscope predictions in the morning paper; to be heard when they say what people want to hear and ignored when people don8217;t like what they have to say.

Paul Krugman had an explanation recently in another context for why economists are useless. He cited 8220;Murphy8217;s Law of economic policy8221; which says economists have the least influence on policy where they know the most and are most agreed; they have the most influence on policy where they know the least and disagree most vehemently. Economists who are prepared to express strong opinions on inherently ambiguous questions, such as whether Microsoft should be broken up, are heard with rapt attention, Krugman says, but when economists actually do understand something, people don8217;t want to hear about it. So, that is why economists are useless.

How the Congress party goes about the process of crystallising its economic opinions is its own business. It may even feel it is not necessary to have a stance and that it can afford to muddle along as it had done in the past.

In politics it pays off sometimes not to take a position but to straddle as many as possible even contradictory ones. Sometimes, of course, on those inherently ambiguous questions, it is simply not possible to arrive at a consistent position. What matters is the message that would be sent out to the public at large if Manmohan Singh were seen to be excluded from the Congress8217; inner party economic councils. It would say, first, that the Congress refuses to recognise talent and experience and elevates inexperience and mediocrity. Second, it would signal to the world a reversal of policy on market reforms because, like it or not, Manmohan Singh has come to be associated with economic deregulation and liberalisation.

Third, it would tell business and industry in particular that the Congress was in danger of losing its way and stumbling back into the past. The importance of Manmohan Singh is that more than anyone else in the Congress or outside, he represents an idea which has taken hold of the country, the idea that economic decision-making by millions of people will produce a better world than decision-making by bureaucracies. People still have many expectations from the government but they are increasingly of a different kind, the expectation, for example, that the government will clear the path for individual decision-making, that the government will by improving health and education help more people to help themselves and so on. It may well be that the Congress review panel, if it is set up, will come to rational Manmohanomic conclusions with or without Singh on the panel. But without Singh the world will have to be convinced all over again they are good ideas. Why risk that, why throw away the advantages of instantrecognition, invaluable brand equity?