What is the public interest, and who decides it?

State, Market, Society

A few years ago, I was at a global event on mobility in the hometown of a major bus manufacturer. One of the sessions at the event was with the mayor of the town, who described in excited terms how the city’s partnership with the company was going. From the audience, someone asked, “Is this partnership open to other bus companies as well?”

No, it isn’t, the mayor replied. Which led to a second question, “Is that not against the public interest? How can the government select one company as the beneficiary of its partnership in a way that excludes others in the market?”

I’ll never forget the way the mayor answered this one. “We are a medium-sized town trying to stay globally competitive and keep our jobs and our way of life. A big part of the local economy is tied up with the fortunes of a few major employers. Our interest as a city is not something separate from their interest. Of course, we have other interests too, but it would be foolish to pretend that the ‘public interest’ in this town should put the public of the town at risk of unemployment by exposing the major employers to competition!”

There are good reasons to disagree with this view, and many scholars of public policy have gone into that. At that time, and since then, I’ve been struck by the simplicity and directness of the mayor’s response. Be careful what you wish for in the name of good governance, she seemed to say, you might get it and then wish you’d never asked for it!

I was reminded of all that this week, when the CEO of Vodafone declared that the company’s India operations were contributing nothing to the price of the stock globally, and that various hardships (in his view) imposed by the government and the courts had made any further investment in India unlikely. The news in the media subsequently has mentioned the possibility of total liquidation of Vodafone in India, which seems extreme for a firm with 300 million customers.

What is the public interest, and who decides it? If a balance of power between the state, markets and society is important for development, where is the line that separates them? For a very long time, the Indian State has taken the view that markets and society are risky things, easily exploited, and it must therefore keep a hand on them at all times, without which the worst tendencies of each will run rampant.

At the same time, the post-election situation in Maharashtra presents a mirror to this view, showing actors of the State themselves to be acting on their worst inclinations. And as various parties competed to convince the Governor and the Supreme Court to lean this way or that, it was natural to wonder, “Who represents the public interest in all this? Where is the voter’s view?”

Broadly, then, what should we do about public problems? How should we approach problems about which many people agree that ‘something’ must be done, but whenever anything is proposed to be done, there is great disagreement among the same public about whether that’s the right thing to do?

Maybe the thing to do is not to try to answer this question, but to simply keep learning from each new issue and experience, and iterate our way forward. There are a very large number of issues over which we’ve come to a standstill because we can’t agree on what should be done to solve them. And with each day that passes with the questions unresolved, we’re also diminishing our capacity to do anything about them, even if we could somehow magically arrive at a consensus.

Like the NimBus project to create a bus priority lane on ORR -- a lot of people agreed it’s a good thing to do, but when the specifics were put to the test, it turned out that there’s no way to do this without pushing some current users off the lane (not just other vehicles, but also pedestrians, vendors, autos waiting for a fare, etc.) and even after that tough pill was taken, it had to be delayed because no one really knows how to do something like this. By not grappling with difficult problems for so long, we’ve slipped in our capacity to do so, and that, too, has to be rebuilt.

Back, then, to the questions -- who decides what the public interest is, and who should act on it? I don’t think there’s a uniform answer -- every issue is bound to be different, and require its own balance of actions across state, market and society. But in another sense, there is a common answer. Every issue must include voices and actions from all three, and every serious issue will require choices to be made. We have to get away from our old preference for order and get comfortable with discord -- the road to development runs through it.