There is further evidence today that the guiding philosophies of our ruling intellectual elites are in serious error.
Let us begin with Bimal Jalan, who was governor of our central bank, is now a Rajya Sabha MP, “economist,” and author of many serious tomes on the “Indian economy.” Someone said he started off in the IAS – but I am not sure.
Bimal Jalan has been interviewed by the Financial Express on his idea of “nano houses for the rural poor”: the one-lakh house, built like a phone booth, sold through franchisees, and so on.
Don’t get me wrong: I am all for pre-fabricated homes. I would buy one myself. But let us delve a little deeper into this idea and see where the philosophical error lies.
He wants to sell these cheap houses in rural India, to villagers. And that too, with interest subsidies, government patronage and whatnot.
Now, I would rather begin by selling these cheap pre-fabricated homes in cities and towns. Here, housing is terrible for the poor. Indeed, the urban poor know full well that they have left far better housing behind in the villages when they decided to shift to a city slum.
I have often posed this question to villagers as well as city slumdwellers:
Choose between two acres of land in a village and two rooms in a city.
None so far has chosen the two acres.
And note that in everything else that is sold, the marketing campaign invariably starts from the cities, spreading outwards. Jalan’s nano homes will be sold the other way round. And that too, as a “government-sponsored programme.”
One portion of the interview is worth quoting:
FE Question: Your interest in rural housing?
Bimal Jalan: When I was the president of NCAER(1998-2008), we thought a study based on field work should be done on rural housing. That’s how I got involved. This is the interesting thing about NCAER. Very few organisations do sample surveys. This study is based on actual ground level work. From our wider perspective, it is of equal importance because there is a social aspect to Indira Awas Yojna and many other such policies. There is also a banking policy with loans below 4% for certain amount of housing. Government and everybody are interested in rural housing as 65% of our population is in rural areas. If you provide for rural housing, for example infrastructure is very important, it becomes an extremely important input to increase rural employment. That’s how this started.
The NCAER is a government bureau: The National Council of Applied Economic Research. Jalan headed it, he says, for 10 years. They did the “field research” – over open fields, I am sure. Note the reference to the Indira Awas Yojana, where all the “pork” will come from.
And note how, when asked at the end of the interview as to how much his idea would cost, he says: “I Don’t Know.” This is typical of the “planning mentality,” especially when fed on Keynesian nonsense that The State is the fount of all money.
The reason why these “political economists” of India do not mention urban housing for the poor is because they do not want to question the fundamental problem: The State as a land monopolist in every urban area. And a roads monopolist too.
There is actually enough vacant land around each of our metropolises to house the poor in decent localities, with electricity, sewage, streets and even residential addresses, piped water, cable TV and broadband – and the 1 lakh pre-fabricated nano house.
Bimal Jalan’s critical error lies in “thinking rural.” Further, in thinking in terms of State support.
Jalan is now a politician, an MP, so he should be aware of how such subsidised government programmes politicise rural life. And that this “rural politics” is all about “identity” – like religion or caste. This is the precise point made by Kanchan Chandra in “The NREGA Trap,” an article featured in today’s Indian Express. She concludes that only the urban poor possess the luxury of a “self identity” – which is why “urban politics” is entirely “issue based.”
Yes, the cities must take the lead.
Indeed, in cities like Mumbai and Gandhinagar, new candidates have emerged on the political scene. What can we expect from them?
Actually, nothing, says Ravi Shankar Kapoor in this perceptive column.
Ultimately, as Kapoor rightly concludes, nothing much can be done unless we challenge the socialists in their core philosophy.
I rest my case.
Recommended reading: My essay, “Bungalows For All,” available as a free download here.
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