This is article by our professor Vaidynathan where he argues that bribes given by private candidates to public should be allowed rather than looting of public resources in name of government freebies.
Right now this is what has been going on in Madhya Pradesh but we lack intellectuals of this stature to analyze these issues and come up with bold solutions. Dr Jayantilal Bhandari? Are you reading this!!
Public bribery more dangerous than private corruption
Tuesday, October 07, 2008 03:29 IST
The system accepts and encourages bribe to be given from the public exchequer but not from private initiatives and wealth
Elections are nearing and election times are bribing times. Central and state governments brazenly bribe the population with promises and budgetary allocations that are totally against any cannons of governance.
Newspaper reports suggest that the officials of the Election Commission have seized saris and utensils meant for distribution to voters by some of the candidates in the last election in Karnataka. That is considered a corrupt practice to get votes. But if the same candidate or his political party promises to provide every individual with free saris or TVs or power, it is considered an electoral manifesto. In other words, the system accepts and encourages bribe to be given from the public exchequer but not from private initiatives and wealth. Also, future bribes given from state exchequer are preferable to the present corrupt practices by private individuals — according to the code.
When so many freebies can be promised and offered from the public treasury by political parties, why not encourage provisions of free gifts by candidates. May be it can be done in a transparent way, if that is the issue. A register or log book can be maintained about the donations/gifts of an individual candidate. And any how, the voting process is secret. It is not same as bribing some MLAs or MPs to support or oppose a motion of confidence in the Assembly or Parliament. Why deny the poorer segments their due during this “festival” called elections.
Tamil Nadu is known for this brazenness [of using public treasury] much more than other states since there is a competitive populism of unimaginable dimensions practiced in that state. Recently one minister in Tamil Nadu [Public Works] suggested that the state government would provide cooked food at the door steps of every household so that women need not be “suffering” in the kitchen. Already the state government has started rice for one rupee a kilo and spices for fifty rupees as a sop to the public through the public distribution system. Of course, the state government offers free color TV to poorer people.
The state governments and ministers periodically claim that at least one-fourth to one-third of the ration cards are spurious and the population claiming to be below BPL is inflated significantly.
In such a situation, the free TV or free rice schemes is going to erode the state’s fiscal stability and also make families subservient to the state. The concept of taking responsibility, searching for jobs and earning ones keep are getting damaged by the short sighted and pernicious policies of the political class. Not only that - the liquor trade at retail level is operated by the state government and the revenue from that sustains these profligacy. In other words a drunken populace in stupor is expected to support politicians based on future bribes. Other states and central government are following the same path.
The state being corrupt and extortionist - the benefits do not reach the intended groups. It is a mechanism to swindle significant portions of public money in to the private coffers of the supporters of the ruling political establishment. Here we need to understand an important paradigm in our polity. This bonanza is not offered to sustain any failed institutions or market failure. It is simply dacoity of public resources to private pockets and it is supported by the polity in the name of social justice.
Recently the Central Cabinet increased the income ceiling for the OBC reservations [defining creamy layer] from Rs 2.5 lakh to Rs 4.5 lakh. This is not based on any scientific study or analysis but due to pressure from coalition politics. If the Central government has genuinely felt that those above income level of Rs 4.5 lakh are only belonging to creamy layer in this country then they should have the courage of conviction to increase the income tax ceiling to Rs 4.5 lakh. But that they will not do.
Also we find that the Central government has allotted Rs 625 crore for modernising madrassas out of which Rs 325 crore is already released. It is to cover 4500 to 6000 madrassas. Again it is 100% a central scheme when states should be actively involved in this since Wakf boards are managed by state governments and they would know more about the requirements for modernisations of these institutions. The government is silent on the total number of such institutions and the proportion going to benefit.
In the coming months we are going to witness substantial number of announcements and schemes both by ruling establishments and also by the manifestos of political parties which in essence is bribing the voters.
There are many issues of morality, governance, frugal use of funds, accountability and not the least public trust are involved. Unfortunately we have not cultivated a sustained process to fundamentally question the brazenness of our politicians knowing well that what in normal circumstances are categorised as thievery and thuggery of public treasury is accepted as ‘ social justice’ if done by our Netas.
We talk of moral hazard in the context of bail out of US institutions by their congress. But we did not question when the state owned public sector bank namely Indian Bank was bailed out after its chairman and others were arraigned for reckless lending and significantly enhanced NPAs due to crony capitalism.
The hands of our political leaders in public till are too deep to think of moral hazard. We have only hazards. It is required for India to limit the areas of public bribery which is much more dangerous and pernicious than private corruption. Private corruption damages individuals and harms segments of society but public bribery de-stabilizes the entire society and civilisation.
It is told that power corrupts and absolute power corrupts absolutely. We can add that imminent loss of power corrupts infinitely.
The author is professor of finance, Indian Institute of Management-Bangalore, and can be reached at email@example.com. Views are personal.