Socialism146;s big wheel

What is Rs 822 crore of taxpayers8217; money worth? A big chunk of farmers8217; relief package. Thousands of tubewells. And a lot of other things Congress leaders insist matters as they search for newer ways to serve the 8220;aam aadmi8221;. So why is it, as reported in this newspaper, that but for the intervention of the finance ministry a Congress minister would have spent Rs 822 crore on a dead, nationalised tyre unit, arguing that it can find buyers in a market now totally dominated by the biggest, global and local, brands in this sector?

The jaw-dropping irrationality of the proposal showcases one of the worst political, and Congress, traits: rent seeking. Ministers look at their remits as a sum of exploitable opportunities; the basic investment comes from taxpayers8217; money. The only thing that changes, it seems, is the excuse. This time, it is the UPA-created Board of Reconstruction of Public Sector Enterprises BRPSE. BRPSE was the UPA8217;s signal that it takes the public sector as a viable economic player. If putting the threads back on the Tyre Corporation of India TCI is its idea of revival, most of the scepticism that greeted BRPSE8217;s birth now seems spot on. One of the basic distinctions applied to public sector revival seems to be lost here: companies that went bust in the private sector and were taken over by the government as the employer of the last resort are typically sold 8212; as indeed one unit of TCI was 8212; not as a business but as a collection of fixed assets. In fact, state governments, including in Bengal, have done precisely that. Of course, the TCI units are in the constituencies of Bengal CPM MPs. But that is not part mitigation of the Congress minister8217;s action.

The Left, at least in Delhi, is consistent about its full faith in using the exchequer for the public sector. Its national spokespersons always say the same thing. But that8217;s hardly the case with the Congress. It says so many things on economic policy but it can8217;t still hide that for many Congress leaders the state remains a source of arbitrary patronage. The Left may have put the brakes on some reforms. But the Congress, it sometimes seems, needs no help to turn the wheel in the wrong direction.