Maximum Government, Minimum Governance

No, I have not got the title wrong, as some people might think. It is just that a government elected on the platform of delivering efficient service with minimum intrusion into the lives of individuals is doing exactly the opposite today. And it is not just the executive wing of the state which is displaying this enthusiasm to “govern”. As if to match the executive step for step in this exercise, the Supreme Court has ruled that all liquor vends within half a kilometre of highways will have to shut down. So, after being told what she can eat and wear, who she can be seen in public with and what she can read and view, the aam aurat is now being lectured (and hectored) on where she can buy what she wants to drink.

Not that spirits that raise the spirits are popular with our stern, killjoy leaders (let me add a disclaimer that I don’t touch the stuff myself, so there is no personal grievance involved). Chief Ministers who had a beef about beef are now concocting remedies to counter heady brews. Gujarat state and Wardha district in Maharashtra state were the only two regions to traditionally face total prohibition, probably because Mahatma Gandhi had a link with both areas. I have often wondered how IAS officers in the states survived the schizophrenic experience of simultaneously administering both liquor prohibition and augmenting liquor revenues. Probably a case of the left hand not bothering to know what the right hand was doing. Bihar went in for total prohibition in the wake of a heady election victory for the incumbent government in 2015. There are few studies on the effectiveness of this move but I am willing to eat my proverbial hat if anyone claims that liquor is no longer available in Bihar. No state in India, leave alone Bihar, can boast of an efficient, corruption-free administrative machinery that can implement such measures. Driving liquor supply (and corruption) underground will benefit neither public revenues nor public ethics.

It is, however, more the issue of government priorities rather than a specific, ill-conceived policy that ought to worry us. We see the central government tripping over itself in its haste to streamline tax administration and plug leakages. While the indirect tax reform (through GST) was long overdue and welcome, the same cannot be said for the slew of measures to reform the direct tax regime. Starting with the midnight knock (and shock) of demonetisation and the twists and turns in policy over the past five months, the citizen has faced innumerable hurdles in accessing her own, hard-earned money. ATMs have run dry (and continue to do so at various places), bank staff are loath to honour even bearer cheques (as I have personally experienced) and customers are being discouraged from visiting bank branches. Honest tax-payers are now being arm-twisted to go in for Aadhaar registration or forego their right to file income tax returns (though not from paying income tax). So, we will have a situation in Financial Year 2017-18, where people wanting to pay income tax will be unable to do so in the absence of PAN identities but will still be liable for harassment by the IT petty bureaucracy: a compelling instance of maximum government but very poor governance.

We are also witness to a rash of cases where the state is unable, or, worse,
unwilling, to enforce its writ in observance of the rule of law. Cattle merchants, if they are from the minority community, risk their lives in transporting cattle even
for bona fide commercial purposes. That these instances occur in states ruled  by
the same party which is in power at the centre rules is cause for even greater
concern. Governance starts with the guarantee of the citizen’s right  to life and
liberty as enshrined in Article 21 of the Constitution of India.  In fact, we may term “government” to represent hard power, in the sense of enacting rules and
regulations and enforcing compliance with these. “Governance”, on the other hand , represents the soft power of the state, in the sense that citizens voluntarily comply with laws based on a broad consensus on values and an ungrudging acceptance of certain behavioural norms. Governments function successfully
when governance systems are seen to be impartial, nonpartisan, reasonably
incorruptible and based on the rule of law. India is, and has been, through its
independent history, afflicted by far too much government and inadequate governance.

The seeds of big government were sown in the early years of independence when
the state sought to arrogate to itself a role in virtually every area of public functioning. Nehru’s grand vision of the “command economy” drew trenchant criticism from prescient observers like C. Rajagopalachari. Whether in the production of consumer goods or in the provision of important social goods like
education and healthcare, the tentacles of government reached everywhere: the
problem was the shoddy delivery of goods and services. 1991 saw some changes,with, over the following years, competition in sectors like banking,
telecom and automobiles improving both the quantity and quality of goods and
services. The problem lay in the approach to liberalisation: the licence raj was
dismantled to a considerable extent but the inspector raj remained strongly entrenched. The ultimate irony arose during the decade-long UPA regime,
when a Prime Minister turned into a pale shadow of his earlier avatar as a progressive Finance Minister. Oppressive government continued through
the entire period – the instances of retrospective tax demands, messing up the telecom revolution and discouraging private investment in the petroleum sector
through a combination of hamhanded regulation and excessive doubt of private sector motives come to mind – so much so that private investment slowed down
to a trickle and investors hesitated to put their money in India.

Hopes for an economic renaissance soared again when the new government
assumed office in 2014, on the promise of good governance rather than big government. Unfortunately, apart from certain positive steps like the GST legislation, the present government has fallen into the same habits that characterised earlier governments. Ideology has had a role to play in this but there is also the Pavlovian suspicion of the average citizen. With the central government (and its regional formations) obsessed with the dietary and cultural habits of its citizens, policing of consumption of certain forms of meat and of the mingling of those of opposite sexes has come to the fore, with vigilante right-wing groups  acting as self-appointed guardians of morality. Article 11 of the United Nations Universal Declaration of Human Rights explicitly states “Everyone charged with a penal offence has the right to be presumed innocent until proved guilty according to law…” Recent incidents like the lynching of those
transporting cattle (and the subsequent police action against the victims of violence) and the illegal intrusion of police in the private relationships of consenting adults violate this universally recognised right as well as the
constitutional guarantees of rights to liberty, freedom of association and to practice any profession or carry on any trade, occupation or business.
The recent moves of demonetisation and tightening of the direct tax regime, while ostensibly directed against tax evaders and corruption, hurt the small man to a far larger extent. What is forgotten by those in charge of policy formulation
is the enormous scope for tyranny in the petty bureaucracy charged with enforcing  laws. The income tax official has acquired substantial powers of raid
and seizure in enforcing his writ on the hapless tax payer, the lower municipal
and police official has considerable scope to harass butchers and slaughter houses in checking “illegal” slaughter of animals and the local thanedar can question any man and woman seen together, in public or elsewhere. What
is forgotten is the centuries-old “Indian” tradition of oppression of the average citizen by the lower bureaucracy and the continued inability of the higher
bureaucracy (and the political class) to enforce norms of probity on this gargantuan bureaucracy.

Ultimately, the citizen will experience freedom only when technology (and strict
enforcement) compel the lower bureaucracy, especially at municipal, thana and village levels, to conform to standards that are taken for granted in more
mature democracies. It is not the central government that administers
these levels of the bureaucracy: however, by its own actions, it should create
an enabling environment where governments at lower levels are shamed into
action to ensure responsive, corruptionfree bureaucratic functioning.
As of today, there are still no serious efforts to restructure the bureaucracy
at all levels, review outmoded laws and make it easier for the citizen to
carry on her daily professional and personal life. The recent United Airlines fracas in manhandling a passenger cost the airline over half a billion dollars in lost market value as investors punished it for its executive excess. Governments lose far more in the election market place when the public withdraws its confidence in the incumbent government: 2004 and 2014 are chastening
examples for the political elite in India from both sides of the spectrum.
Enforcement of the rule of law without unnecessary intrusion by the arms
of the government is, in the long run, a far better guarantee of a happy citizen and a happy society, as also of the continued survival of governments.

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