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Economy Dec 9, 2013

Verdict 2013: The rise and fall of Sonia’s Dole-onomics

By R Jagannathan

Verdict 2013 will be read differently by different parties, but underlying it all will be one simple message which no one will acknowledge in public: the days of buying votes with taxpayer money are coming to an end. Politicians have to learn to taper doles, or else they will be destroying the seedcorn of future growth and their own legitimacy.

But it is unlikely that any party will acknowledge this reality because it needs honesty in understanding why doles are ultimately self-defeating for good politics to drive good economics. The truth is politicians - whether it is the Congress, the BJP or Arvind Kejriwal's Aam Aadmi Party (AAP) - do not try to understand the root cause of the issues they are trying to solve with doles or general do-gooding. They are too busy celebrating victories and mourning defeats to ask why.

Every politician believes that one more dole cannot hurt and anyway voters won't countenance a cut in their subsidies. Sure, but that's because politicians do not talk about what voters lose when they seek freebies. If you ask a voter if she wants rice at Rs 3 a kg she will surely say yes; even a Birla or Tata would not be averse to receiving super-subsidised rice if its being handed around. But if you ask the same voter of she would trade Rs 3 rice for Rs 10 rice, provided the streets are made safer for her daughters, she will surely weigh the benefits.

The Congress defeat lies embedded in this hidden voter realisation that by getting freebies, the government may be robbing them of something else that may be dearer - self-respect, safety or faster job or income growth. Arvind Kejriwal's good showing has little to do with his promise of 50 percent cuts in power tariffs, and more with the frustration ordinary people feel when dealing with government.

Let's use the why-why technique to understand the root causes of the Congress's defeat.

Why did the Congress lose Rajasthan and Delhi despite launching a dozen welfare schemes, including one for free medicine? One answer could be the message didn't get through - as everyone from Sonia Gandhi to Rahul have gone on record as saying.

Rahul and Sonia Gandhi attempt to explain their losses. PTI

Rahul and Sonia Gandhi attempt to explain their losses. PTI

Which brings us to the second why: why didn't the message get through? Was it merely bad communication, or was it because the audience was not receptive? It can't be the first, because the Congress has been talking about aam aadmi and rights-based entitlements and cheap food since 2004. The answer to the second why could be that the electorate was distracted with something else, or listening to someone else.

The third why: why didn't the electorate listen to the Congress, and who else was it listening more attentively to? Sonia Gandhi proferred one part of the answer - price-rise - and the two people the Rajasthan electorate was listening to were Vasundhara Raje and Narendra Modi. Thus, even when Ashok Gehlot was doling out the goodies, people were thronging to hear what Raje and Modi had to say - and they were largely talking governance, not doles.

The fourth why: why is governance more important than doles? Answer, governance involves many things, including less corruption, making things work, generating jobs, and livelihoods. Sometimes it may include doles for the really needy. When faced with the choice of doles as against high inflation and little possibility of good job options, people were not interested in the Congress telling them they needed more doles and more free stuff.

The fifth why: why are people unhappy even with a dole? After all, who says no to free stuff? The answer lies in human psychology. Doles demean. Work ennobles. No one likes to be the recipient all the time, for pride lies in being able to fend for yourself.

The Congress party's basic message to citizens was this: "We will give you cheap food"; "We will get you four times the price for your land"; "we will give you the right to education;" "We will give you 100 days of work-free jobs, and keep increasing the wages." And who was the "we" - the Dynasty. Everything flows from the benevolence of the Dynasty. This is essentially a throwback to the feudal era where the poor are supposed to feel grateful for the things you throw at them.

Well, India has changed, and even the poor do not take kindly to being patronised by the Congress or the rich. They want ennobling work, not demeaning doles, though no one will refuse a dole, not even the rich.

Forget doles. Even the minorities are upset with being told that the Congress is their protector and benefactor against that big evil Sangh Parivar, and their chief ogre Modi. Muslims may have no love lost for Modi, but they are not fools to believe that once you beat the Modi drum, everyone should rush to the polling booth and vote Congress.

Now juxtapose this why-why reasoning with the shock and bewilderment expressed by the likes of Ashok Gehlot, Sonia Gandhi and Rahul Gandhi. Gehlot, who led his party to its worst drubbing since independence by gifting Vasundhara Raje an unheard-of four-fifths majority, said he couldn't understand why Rajasthan's voters rejected his pro-development agenda.

He said: "There was no reason for us to lose. Our campaign was on the basis of development, but we failed." He didn't stop to consider the possibility that what he thought was development was little more than dole.

Sonia Gandhi called for "deep introspection", but far from introspecting she merely speculated on the causes of her defeat. A deep introspection should leave open the possibility that you yourself could be the problem, but Sonia more or less said what Gehlot did.

"A great deal of work" had been done in Delhi "but obviously (the) results tell us something else. We will introspect seriously and we will take all necessary actions to rectify our mistakes or our way of functioning," The Indian Express quoted her as saying.

Among other things, she seemed to suggest that there was a problem in the way her party took its message to the people, and there was also some suspicion that inflation may have something to do with it. "Obviously people are unhappy, otherwise we would not have these results. Price-rise was also an issue that was affecting the people."

She didn't stop to ask whether the inflation may have been the result of her own mistakes.

As for Rahul Gandhi, the less said the better. He said the Congress had to "move ahead of just good governance" and "give serious space to the common man in our processes, in our systems and in our structures." This statement suggests that the Congress is already delivering "good governance", which is no one's case outside the Congress.

Rahul also said seemed to blame the party for the drubbing and he promised to "put all my efforts in transforming the organisation of the Congress." He promised to out-Aam Aadmi the Aam Aadmi Party and said with bombast: "We are going to do a better job than anybody in the country and involve people in ways that you cannot even imagine right now."

One thought streamlining the organisation was what Rahul Gandhi was doing so far, and if he cannot get the job done and "involve people in ways" we couldn't imagine over the last 10 years, why should one expect him to do so in the next four months?

But what Gehlot, Sonia and Rahul missed was the fundamental point that development is about capacity-building in people and the economy, so that people can stand on their own legs, throw away their crutches. It is not about finding better crutches, or enhancing existing crutches with gold inlay work.

The reason why the Congress got soundly thrashed was precisely because of what Rahul is planning to do now: fix a problem without hearing what it is about. He should ask himself: why is it that the Congress has been unable to listen to the voice of the people and involve them so far?

The answer is that careers in the Congress depend on sycophancy. Leaders make it to power by kowtowing to the Dynasty, and this is why the Dynasty does not get to hear what the people are saying. In short, it is not his view on the Congress organisation and its hearing capacity that he needs to change, but he has to change himself. From being the feudal boss of the Congress, he has to promote genuine leaders who can one day even stop listening to him!

The same goes for Sonia. Why didn't she hear the right messages on what was brewing in Delhi or Rajasthan, not to speak of Madhya Pradesh and Chhattisgarh?

Instead of listening to Manmohan Singh and P Chidambaram or even Pranab Mukherjee, each of whom could have told her the economy was imploding under the weight of her doles, she chose to listen to the jholawallas of the National Advisory Council (NAC), who kept telling her that more and more money needed to be given to the poor. Her own sycophants kept telling her that one more dole should do the trick at the next elections. This is why after claiming that the UPA has the best record on poverty alleviation, her party negated its own claims by bringing two-thirds of the country under the food security bill.

Let me not overstate the case against doles. Nobody, when offered a dole of a freebie, will reject it. We are all suckers for freebies.

However, a dole that does not have a finite life will destroy the economy which helps finance it and destroy the jobs it is meant to be an alibi for. The reason why the economy has reversed course from 9-10 percent growth and 4-5 percent inflation to the exact opposite is that Dole-onomics has murdered economics.

This is what the electorate is sensing. This is why the Congress got its comeuppance on Sunday. Those who live by the dole will end up on it one day.

by R Jagannathan

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