"Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime". This famous saying talks about the importance of building long-term capabilities that are more effective than giving short-term relief, but in spite of this being highly famous and so overused that a friend remarked give a mallu a fish, he will ask for two more, this seems to have escaped the ears of our policy makers.
Ours is a nation that spends nearly 1.9lakh crores on subsidies, mostly on fuel, food and fertilizer. Then there are dole-outs like free electricity to farmers and no tax on agricultural income, the benefits of which hardly reach the intended population. This is the fate of most affirmative action programmes, with reservations benefitting only the comparatively well-off among these sections and they alone perpetually flourish as the less fortunate in their own community continue to live without any improvement in their lives.
With beneficiaries not being reached, schemes being riddled with corruption and leakages and clamour for fiscal discipline from corporates, international organisations and trade bodies, subsidies are the first to face the axe. A cause exists in reducing fuel subsidies, but not completely and only under certain conditions. These conditions include providing the poor who use kerosene for lighting and cooking with alternative methods like solar lanterns and cookers, higher tax on diesel vehicles, better roads and public transport, prohibiting use of diesel in mobile towers, reducing the high taxes and a clear explanation of how these tax revenues are spend. There is a need to provide food subsidy and fertilizer subsidy to some extent because we have the worlds largest number of poor even by conservative estimates and we are not self-sufficient in fertilizer production and we need to import it.
But doesn't it all sound so simple that a person with just basic common sense and knowledge without any political experience can come up with these? It seems obvious that these facts could not have escaped the attention of economists from Cambridge. So why do they continue on this is an obvious question and this is where the 'fishy' saying matters. If you teach him to fish, he no longer needs you and you would be out of the picture. But if you (contractors, Public Private Partnerships, Panchayats) continue to give him a fish and extract a fee for that from the government in the name of poverty alleviation or even better, continue to claim you are giving him a fish, but keep it for yourself and keep taking the fee, it is a highly profitable long term venture.
Should subsidies be totally be done away with? No. Some of it should be reduced, regulated with the use of technology like sensors in personal diesel vehicles and some done away with like diesel generators to run mobile communication towers. The case for food subsidy is strong because inspite of the growth our economy has witnessed, we have also seen depreciation in wages, rise in rich-poor divide and fall in purchasing power due to inflation. The first function of the government is to protect the lives of its citizens, not just the rich or those who want to trade with the west, but each and every citizen. Food is still a basic human requirement and cannot be replaced with Rs.10 recharge coupons or smart phones. Ensuring this basic need is met is the function of the government, especially in a time when we have lop-sided development. Some subsidies should be restructured, as in the case of fertilizers where nutrient based subsidies should be implemented completely in which use of fertilizer is determined on the base of condition of soil, climate, irrigation, requirement etc. Though in some cases, like food, a basic necessity for all, there should be universal coverage to ensure no one is left out.
By offering development and favours of subsidies and loan write-offs, government builds for itself a better image but benefit only the well-off. It gives hope to the poor which will translate as votes. If all our aspirations are met, if all our basic needs are satisfied, then we will start holding the government accountable and expect more from it. It is easier to manage a population that requires only the most basic of needs since they can be lured in with the most basic of campaign promises.
Therefore, all these schemes, in spite of being well-conceived and well thought out with good intentions, are being manipulated to keep people poor for economic and political profit and we will never grow out of it unless the poor take their destiny into their own hands. The anti-development thesis is especially about the poor coming together, organising themselves into a system that goes against the current form of development that benefits only those with money to make more money while there is little trickle down to the poorer sections.
Schemes should be reinvented to provide assistance, encourage self-empowerment, self-employment and formation of self-help groups. As I mentioned before, I am not talking about completely removing subsidies and poverty alleviation schemes or always going against loan write-offs, these may be necessary due to existing situations and also if there are unexpected occurances like droughts, floods etc. These are ad hoc measures to be pursued in the short term till the people are ready to take control of their own lives. For example, unless the society and government as a whole ensure protection, equality of opportunities and fair treatment for women and girl children, they cannot expect to empower themselves through education and attain financial independence.
Skill development, electricity, roads, communication technology and providing the basic services to all individuals should be the priority. The purpose of the scheme should be to enable individuals to take their fate into their own hands and overcome their dependence on the government for sustenance, become responsible individuals and hold the government accountable for its actions. It is not a minimalist government, but it is a government that provides the environment for individuals to become better citizens that we need.
