Greetings from
Stalinistan
The banks are stressed, according to the CII survey recently
released. They have massive non-performing assets (NPA), presently the highest
they have been in six years. This, combined with the newly imposed, higher mandatory capital requirements, will seriously
erode their profitability at a minimum.
The much talked about Food Bill, a key thrust area of the
UPA Government, on its way to becoming a food guarantee law under an act of parliament, will place an additional
38.6% burden over and above the currently budgeted Rs. 90,000 crore subsidy for next year.
This will, it is reported, shoot up the subsidy to Rs.1,24,
747.1 crores at present prices, for next year alone. Not only are more people
being included under its provisions, but there is a demand that the highly
subsidised prices be maintained unchanged for 3 years, irrespective of the
expectedly higher procurement prices of
the essential grains and cereals covered.
In addition, there is another, equally ambitious programme
being developed for providing guaranteed
rural housing to the poor at state expense.
The banks are stressed mostly because of forced loans to
economically weaker sections. And the growing
subsidies, transferring from petroleum products towards the public distribution
system and so on, threaten to bankrupt the nation.
But, at the same time, it must be acknowledged that they
seek to help the poor of this country and that is indeed a laudable objective.
The only quarrel that anyone can have with such undeniably lofty ambition is
the fiscal responsibility that should accompany such largesse. This is a new
phase of affirmative action to help the bottom third of the population, but
because it is being done so recklessly by way of straight giveaways, it is
likely to cause considerable harm to our viabilities.
That many of these schemes will not fructify in the year or
so that this Government will be in power before the general elections, makes
them squarely aimed at the electorate. They are designed to provide campaign talking points, and
hopefully restore the UPA to power for a third consecutive term.
But in the event the UPA is not returned to power, as acts
of parliament, these programmes will have to be implemented by any successor
Government. Of course, it is yet to be seen if these initiatives pass into law
in the time remaining.
This kind of institutionalised populism was very au courant in Stalinist Soviet Russia
too where the mighty USSR was bankrupted eventually. And while defence spending
was also part of the problem, everyday developments, shortages, failures,
collapses, run- away inflation, came from the seeds of destruction sown by
policies expected to deliver the longed for “dictatorship of the proletariat”.
But instead, the mega programmes largely failed in the
implementation, or in the results they yielded.
Judging from the fate of the other huge poverty alleviation
schemes instituted by the UPA
Government, these new ones too are likely to be mired in massive corruption,
misappropriation and delay. A leopard cannot change its spots just on the basis
of a wish, and it is doubtful if the efficacy of such programmes is the main
objective at this time anyway.
But regardless, there is an attitude pushing
these schemes with an unheeding arrogance. Any kind of Stalinism, post, pseudo
or neo, invites sudden death if you disagree, dissent, or arouse suspicion, at
least within the Party. And yes,
everything is political in Stalinistan, including economics, and the colours
pink, red, green and saffron.
And the prerequisite
to running Stalinistan is a simple hold on absolute power with plenty of
government agencies that can be used to intimidate, subvert, deny, delay,
banish and hound.
Also, the brazen ability to concoct reasons and
justifications for the most outrageous circumstances while distracting
attention by pouring scorn on and calling all opponents and rivals as many
names as possible.
Our Stalinists are often sentimental, given to emotional outpourings
that purport to bleed for people at any provocation. Or, like a haemophiliac,
for no reason at all, except of course the inability to coagulate blood.
So which atrocity should we speak of first? Is it the sharp
rise in new subsidies? Or is it the rampant money- laundering in several
private banks? Or shall we talk, yet again of the food inflation? Or laugh at
the red herring of becoming a leading manufacturing nation if it manages to
account for 25% of GDP? Or the soft
attitude to terrorism, mayhem, corruption, insurgency, diplomatic snubs, law
and order collapse? Or should we talk of the Opposition’s failures instead?
(763 words)
March 18th,
2013
Gautam Mukherjee
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