Conflict of Visions

When will they ever learn?

(Of course, they don’t want to learn; they want to teach! Talk about hubris.)

After having destroyed India through 60 years of “rural development,” our The State now wants to export their ideology to Africa. Click here to read the news report on foreign minister Pranab Mukherjee’s inaugural address at the Afro-Asian Rural Development Organisation conference.

Mukherjee must be aware that we exported the ideology of rural development to Africa long ago. Tanzania’s “ujjuma” policy under Julius Nyrere was nothing but a replica of Gandhi’s vision of self-sufficient village republics. Nyrere was a staunch socialist, a good friend of Indira Gandhi, and an economics teacher to boot: the splitting image of Chacha Manmohan S Gandhi.

Tanzania has now rejected the ujjuma vision. India has not. Indeed, our The State is now seeking to export this vision of doom to other, less suspecting African nations. The justification: This is for the poor. Mukherjee categorically rejects the notion that markets can improve the lot of the poor. He asserts that direct State intervention is required on their behalf.

In the real world, the “division of labour” is not theory; it is datum. Wherever we look around, we see specialization, including among the poor. One washes cars, the other dishes, a third sweeps floors and the fourth is a cook. There are doctors, engineers, barbers and electricians. There are receptionists, plumbers and lawyers. No one is self-sufficient. This division of labour was noticed even by Aristotle – but Gandhi missed it. As does the Congress government today.

What is important to note about the division of labour is that the extent of specialization is dependent on the size of the market. Thus it is maximized in cities, where markets are huge: you cannot open a Thai restaurant in a sleepy village. In sleepy villages, like the one I inhabited in Goa, nothing much is available: for each and every thing we must go to the nearest town.

This datum (it is not theory) is central to the “conflict of visions” between India’s libertarians and the socialists who run our The State. They pursue “rural development”; we advocate urbanization. Gandhi’s vision, which our The State shares, is of an India comprising millions of self-sufficient village republics. Our vision is of thousands of free trading and self-governing cities and towns.

The rural poor have been “voting with their feet” and migrating to cities in droves for decades. Yet, our planners have adamantly pursued rural development while simultaneously neglecting cities and urbanization. We have just 5 (devastated) cities for a population of 1000 million. The USA has over 200 cities for 350 million people. That is the direction in which we must head. We must build more cities, and the winds of urban commerce must be allowed to fan over village India. It cannot be the other way around. They key then lies in transportation links between urban and rural India. We must end the “rural-urban divide.” Roads must be the government’s top priority.

Talking about transportation, I was not surprised to find a ToI editorial arguing in favour of government funded public transportation. They have applauded a 4000 crore grant from the centre to the states for the upkeep of government-owned bus fleets (and for the shoring up of the bottom-line of Tata Motors, perhaps). Why not private sector public transportation? Why government buses? Why government metros? Why not private tramcars?

As I see it, government bus companies that run at a loss are entities that no entrepreneur, who must make profits, can compete with. The government bus company can charge lower fares always – because it is run at a loss. Ditto for government schools.

Thus, the government should only build roads – and stop right there. Then invite entrepreneurs to supply all modes of transportation: buses, taxis, trucks, tramcars, railways etc. This will bridge the rural-urban divide. This will allow for the growth of thousands of satellite towns around all our cities. The massively enlarged urban space is what will really benefit the poor.