Opinion | Can Rahul’s Rs 72,000-dole ‘Mankad’ Modi?

Last Updated 13 December 2019, 13:24 IST

Election season unleashes the win-at-all-cost spirit of politicians. Netas at this time are no different from sportsmen in the competitive cauldron of a high-stakes game. If Prime Minister Narendra Modi can polish the old ball with sugar candy to extract some late reverse swing, in the form of yearly cash transfers of Rs 6,000 to small farmers a couple of months before the elections, then Congress President Rahul Gandhi has shown he can attempt to “Mankad” the ruling Bharatiya Janata Party (BJP) with a promise of Rs 72,000 annually to some five crore families living below the poverty line.

The debate about the ‘spirit of the game’ and fiscal prudence can wait. Fair-play after all is an illusion glimpsed in the aftermath of a victory. When skill is in short supply, and the state-of-play attritional, cynical tactics become the most potent of weapons.

Both the BJP and Congress are struggling on a sticky macroeconomic wicket. While the BJP claims to have turned India into the fastest growing large economy in the world, employment data from both government and private sector research firms have punched holes in BJP’ big story of buoyancy. The Congress’ track record of delivering sustainable growth, in the absence of global economic tailwind, isn’t great either. More worryingly, the party’s criticism of government’s failures hasn’t been accompanied by a coherent alternative vision. When prosperity cannot be spread wide, pork-barrel politics offers the easiest way out. Why waste time on policy-making when the groaning masses can be plied with placebo, purchased with public funds.

Rahul Gandhi’s pitch to give the poorest of the poor Rs 6,000 a month, in direct cash, cannot have many critics. It is obviously music to the ears of those who make the case for a socialist State. Even those of the free market persuasion have argued for rolling back untargeted subsidies and handing out hard currency to the poor using Jan Dhan, Aadhaar and mobile, or the JAM trinity network.

The idea of universal basic income (UBI) was most recently floated by the former chief economic advisor (CEA) Arvind Subramanian in the 2016-17 Economic Survey (widely acclaimed for its unusually lucid prose and production values).

“Universal Basic Income is a radical and compelling paradigm shift in thinking about both social justice and a productive economy. It could be to the twenty first century what civil and political rights were to the twentieth. It is premised on the idea that a just society needs to guarantee to each individual a minimum income which they can count on, and which provides the necessary material foundation for a life with access to basic goods and a life of dignity. A universal basic income is, like many rights, unconditional and universal: it requires that every person should have a right to a basic income to cover their needs, just by virtue of being citizens. The time has come to think of UBI for a number of reasons,” Subramanian had then argued.

Sensing that Rahul’s gambit could scupper the BJP campaign somewhat revitalized in the aftermath of Balakot airstrike, the party’s supporters are scrambling to find case studies of UBI’s failures. For them, hope shines from faraway Finland like Aurora Borealis. The wealthy Nordic nation’s experiments with UBI for the past two years have produced mixed results at best, according to international media reports. A few thousand Finns in the age group of 25 to 58 were given around €560 a month in lieu of the traditional unemployment doles. Fortune magazine reported that in the first year, the basic income made the subjects feel healthier and less stressed.

“However, it didn’t have any meaningful effect on the subjects’ employment—compared with a control group, the participants worked an average of 0.4 days more during 2017, and earned an average of €21 less over the same year,” wrote the magazine. According to the statement by a research coordinator at Finland’s Labour Institute for Economic Research, during the first year of the experiment the recipients of a basic income were no better or worse than the control group at finding employment in the open labor market.

“QED,” claim BJP supporters.

Can the Rahul idea, that could by conservative estimates cost Rs 3 lakh crore, or roughly as much as India’s defence budget, be a game-changer?

It’s not. This is the new game in new India.

When it became plainly obvious that the run rate required to achieve the stated target of doubling farm income by 2022 was beyond the powers of even the big hitter Modi, the government first played around with the figures. With some creative number crunching, it declared that the target had pretty much been achieved. The persistent farmer protests nationwide proved otherwise. So, instead of addressing farm distress through painstaking reform of the broken sector that can make farming an attractive enterprise (and an unwillingness to bear the burden of another round of blanket loan waiver), the BJP government opted to give farmers a small token of samman.

The game promises to get uglier as election Test nears the end, not before the economy is hit for a six. To invert a Ravi Shastri cliché, India will be the real loser by the time this humdinger is over.

(TR Vivek is a Bengaluru-based journalist)

(Published 26 March 2019, 10:59 IST)

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