The Reformer In A Labyrinth
The FM has asked all the right questions. A bit of administrative reform could get the answers going.
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A View From The Outside: Why Good Economics Works For Everyone

PAGES: 392; RS: 495

I've always believed that the mark of a good columnist is not to provide answers but to stimulate the reader's mind, setting it off in new and creative directions. In this regard, P. Chidambaram, the columnist, succeeds admirably. This book is a collection of his columns, written originally for the Indian Express when he was out of power. He sent my mind flying in many directions, and here are a few examples.

At several places in the book, Chidambaram expresses disappointment—the anguish that we all feel—over the failure of public officials to deliver day-to-day services to people. When he says, "What we need is 50 more Sreedharans and 50 more Delhi Metros," it is a cry of helplessness. We always need more implementers of high calibre, but his subtext is: why are our public officials so poor at execution? Is the lack of accountability due to the insidious seniority system run by small and safe men? When a person is promoted regardless of performance, he loses his will to excel, and so, what was once called the best civil service in the world has been 'dumbed down'.

Ironically, during our socialist days we worried about economic growth, but were proud of our world-class judiciary, bureaucracy and the police. Today, we're ashamed of these very institutions although we take growth for granted. The persons who run India's public services are still among the brightest. Yet, they do such a poor job in delivering water, health, education, transport, law and order to the people. One of our greatest failures is the inability to change the incentives in our administrative system.

Take one area that touches people's lives daily. One out of four teachers is absent in government primary schools and one out of two present is not teaching. We have over a million school teachers in our state system. This means that at any given time, 6,70,000 teachers are not doing their job. We spend around 4 per cent of GDP on education or roughly Rs 1,20,000 crore, and if this lack of performance characterises the whole system, it means we're wasting Rs 80,000 crore. Yet, the answer of our education establishment is to raise spending on education from 4 to 6 per cent of GDP.

About projects, the FM writes, "This calls for monitoring, paying attention to detail and working hard to ensure that projects are started and completed on schedule." Great strides are being made on the Delhi Metro not because the project was brilliantly conceived, but because its leader sets clear, measurable goals, monitors day-to-day progress, and persistently removes obstacles. Most Indian public officials fail in this respect. Should we not train our officials at all levels to be better implementers?

We're in the habit of blaming democracy. Chidambaram asks, "Does democracy, by itself, assure the rule of law?" This set me thinking about the relationship between governance and democracy. I was reminded of Fareed Zakaria's book, which explains that democracies can also be incompetent and illiberal. If government teachers show up in other democracies, why don't they in ours? We're lucky in India to have the gift of democracy, and it's wrong to blame it for our sins of misgovernance.

Fortunately, Chidambaram is in a position to do something. The finance ministry has a bad reputation in the eyes of the taxpayer. Excise, income-tax and customs officers are regarded as corrupt, rapacious and arrogant. It is a pity that Chidambaram's excellent work in delivering us world-class tax and tariff rates is partly vitiated by bad procedures, systems and attitudes. If he brought his considerable intellectual ability to bear on administrative reform in the departments of his ministry, Chidambaram would be amply rewarded with higher revenues and may go down as one of our greatest finance ministers.

There is a lot of wisdom in this book, as well as entertainment, and I have enjoyed it. I did miss, however, answers to a few questions. Most economic reforms push the state out of the way; hence, they were not in the interest of either babus or netas. So, why did all the governments after 1991 keep reforming? Secondly, why do our reformers not do a better job of selling the reforms and allow anti-reformers to prevail at elections? I recall most of Margaret Thatcher's energy went not into creating reforms but into educating her constituents that reforms were good for the poor. So, here is an idea for another book, Chidambaram.

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