BackIndia: rules vs exception-based
While the idea of a rules-based regime is new, the mindset of the nation, especially among the ruling elite, favours exception
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The last few weeks have been very chaotic politically as impropriety in public office made a dramatic comeback on the public agenda.
If one were to ignore the cacophony of charges and counter charges, then it is possible to see this as an outcome of a larger institutional confrontation—between a rules-based regime and the one based on exceptions.
It is the political economy of this tussle between two regimes that makes it so compelling.
One is fair and transparent, the other beset with the opportunity for patronage.
While the idea of a rules-based regime is new, the mindset of the nation, especially among the ruling elite, favours exception. The transition from one regime to another is creating this asymmetry—the recent exposés are only a reminder.
This face-off is critical.
The next 60 years of India will be deeply influenced by whether it is able to successfully implement a rules-based regime.
In a rapidly transforming social landscape and a young demography driven by aspirations, an exception-based institutional mechanism is a recipe for disaster.
Though the country was off to a great start immediately after attaining Independence in 1947 by adopting a terrific Constitution, it was all frittered away in the subsequent decades.
The politics of the country worked to chip away at the institutional edifice, the 40th anniversary of the Emergency serving an apt reminder about the consequences of hollowing out institutions in the country.
But, after the turn of the new millennium, the discourse has begun to alter visibly as there was greater pressure from below to alter the status quo.
It has a lot to do with the fact that politics became more representative. Not only did the regional forces find a separate niche for themselves, the national parties, too, had to create that space to ensure that they remain politically relevant.
At the same time, the ruling elite had to cede ground, and politics was forced to become more socially representative.
Inevitably, the society, too, began to reflect this trend.
Look around you. Whether it is at school, university or the workplace, the social composition has fundamentally altered. People from outside of the top metros are present in fair measure and, in some cases, dominate. The most prominent example being Mahendra Singh Dhoni—India’s most successful cricket captain, who, unlike most of his predecessors, comes from Jharkhand. Growing aspirations have ensured that this trend feeds on itself.
In this context, an exception-based regime is an obvious no.
Obviously, a rules-based regime is the appropriate answer.
To be sure, this institutional makeover has been evolving for some time—unfortunately, at an incremental pace.
The spread of automated teller machines, or ATMs, meant the end of queues at banks, either to make deposits or withdrawals; of course, the rise of Internet banking has taken this process of disintermediation to another level. Similarly, booking airline/train tickets today is a breeze, and the spread of e-commerce means that the way we shop will never be the same again.
Similarly, the brilliant idea of Aadhaar, or a unique identity number for every resident Indian, has the potential to enable even greater disintermediation.
The most popular example of its use so far has been in the distribution of cooking gas subsidy; by seeding Aadhaar with bank accounts, the government has been able to not only ensure a dramatic drop in leakages but also ensure the subsidy is availed of by those for whom it is intended.
To its credit, the Bharatiya Janata Party (BJP)-led National Democratic Alliance is unmindful of the fact that this was originally conceived by the Congress-led United Progressive Alliance (UPA).
It is now proposing to take this to another level—once again cannibalizing a UPA idea—by creating bank accounts for everyone and integrating them with Aadhaar.
The B2C (business to consumer) model of governance in future will only accelerate disintermediation and further shrink political patronage.
The recent revelations of impropriety in public office are only a reminder that this transition is going to be anything but smooth. The temptation to revert to an exception-based regime is very difficult to resist.
Viewed thus, it may presumably make it easier for the politicians to deal with the solutions to address growing public disquiet.
The response so far of politicians, as argued in Capital Calculus last week (https://bit.ly/1BNIpkS), is to evolve a convenient lexicon on impropriety when holding public office, justifying the inability to press ahead with the rule of law—like it is for the rest of us.
This is a slippery slope and something the BJP, which has borne the brunt of the criticism, is presumably realizing.
Though in constant denial, the charges are rapidly eroding the BJP’s hard-earned social capital—among the middle classes at least —a little over a year after it shocked one and all with its runaway win in the 16th general election.
If it has to recover, then it has to signal an unambiguous commitment to a rules-based regime. This is not just good politics, but also good economics.
Anil Padmanabhan is deputy managing editor of Mint and writes every week on the intersection of politics and economics. Comments are welcome at capitalcalculus@livemint.com. His Twitter handle is @capitalcalculus
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