Assume Mr Average-Voter, a resident of Prosperityland, is offered the choice between two electoral alternatives — a school building or a road connecting the neighbouring village. Now imagine the same Mr Average-Voter, living in Populismland, and facing a choice between another two voting alternatives — a cellphone or a television set! Much as Mr Average-Voter would covet the cellphone or the television set, the prospect of a school building for his daughter or a road to transport his agriculture produce would appear more attractive. But unfortunately, our polity increasingly resembles Populismland and it remains a formidable challenge to formulate policies that emulate Prosperityland.
It is widely perceived by political parties that providing individual benefits is the surest way to win over voters, especially the poor. This perception is in accordance with our political tradition that is directed more at the individual voter than interest groups. Indian politics is replete with numerous examples of political parties competing in promising individual benefits such as social welfare pensions, loan waivers, housing, Rs2 rice, free power, etc. This list is now expanding rapidly to include modern consumer durables such as television sets, cellphones and refrigerators.
Such individual-centric promises are a natural progression from the well-documented practice of purchasing votes by allurements of liquor and cash. Political parties now see an opportunity to formalize and institutionalize such allurement and regard the median voter as a commodity to be purchased in the political marketplace. The result is an increasing trend towards competitive populism, targeted at the individual voter and pandering to the lowest common denominator, which threatens to engulf our polity like cancer.
Political commentators and opinion makers express righteous indignation and anger at competitive populism, and demand putting an end to it. Economists despair about its consequences on the fiscal balance. But it may be facile to assume that populism can be eliminated.
Competitive populism is a well-established strategy through which political parties signal their intent to voters. Just as supply and demand in a regular market facilitates price discovery, the dynamics of competitive populism operating in an open political marketplace helps in efficiently allocating votes among competing parties.
Much like the market in goods and services, the political marketplace, too, cannot be regimented through something similar to command and control policies, which seek to outlaw populism. The challenge is to incentivize populism to benefit the common good.