Economic and Political Weekly June 26, 20042666

Commentary

SUPRIYA ROYCHOWDHURY

Following the victory of the Con-gress-led alliance in the Lok Sabhaelections, there has emerged a manylayered debate over the relationship be-tween economic reforms and the recentelectoral verdict, more broadly betweenmarketisation and political democracy. Thefirst dramatic sounding of this debate cameperhaps from the historic market crash inthe immediate wake of the election results.The lefts historic gains in this election,followed by their (somewhat premature)announcement that the disinvestmentcommission would be dissolved, is sup-posed to have at least partly caused thecrash. Of course, anyone looking evensuperficially at the CPM-led Left Frontsliberalisation efforts in West Bengal, wouldknow that the left is not seriously opposedto economic reforms. Nevertheless, it wasperhaps not this awareness, but the

lefts subsequent decision not to join thegovernment, the ascendance of ManmohanSingh, the original architect of reforms,and so on, which calmed frayed market andother nerves in the post-crash days.

Far more interesting than the marketcrash, has in fact been the various layersof responses, from the political and intel-lectual class, to the possible contradictionbetween economic reforms and democraticpolitics thrown up by this election. Therewas great anxiety, almost a scurry, to protectthe sanctity of the reforms, as project, fromthe tumultuous changes that had occurredin the polity. This anxiety has beenreflected on the elections mostly in thepopular media. Thus Sunil Khilhani,eminent political scientist, wrote in theHindu, (May 20, 2004) the electorate hasnot voted against economic reforms; it hasvoted for the extension of its benefitsbeyond a narrow spectrum. Khilhani thencalled upon the left not to derail the

reforms, to take to constructive pragma-tism, not to doctrinaire obstructionism. Inthe same issue of the Hindu, Pratap Mehta,political scientist and well known com-mentator, wrote it would be a mistake tointerpret this as a vote against economicreforms. It was, according to him, theunevenness of the spread of the impressivegains of the last five years that was votedagainst. Khilhanis and Mehtas views havebeen echoed and reechoed by others in thepopular press.

The Congress, of course, as the originalarchitect of reforms in India must appre-ciate such endeavours, which essentiallyseek to free the reforms from any entangle-ment with electoral politics. With this intent,Congress spokespersons like JairamRamesh have also assured the public thatthe lefts cooperation in this governmentcan mean no harm to the project of re-forms. In his words, The Left is 90 percent in agreement with the Congress overthe logic of reforms (interview with ShekharGupta, NDTV, May 22, 2004).

This entire approach points to severalinteresting patterns in the ideology of theelite class, whether political, economic orintellectual. In the first place, we need tonote that there has been no definitiveanalysis yet of the election results. In sucha context, to say that the vote was not (orwas) a verdict against the reforms, is notonly premature, but essentially undemo-cratic insofar as it represents a hurriedattempt by the intellectual elite to paint theverdict in their preferred colour. In acountry with wide economic disparities, itis surely highly presumptuous to say

Economic Reformsin Political SpaceIf it is accepted that the contours of the possibility of state-supportedwelfare are shaped by a continuous adjustment between capitalsprofits and public welfare then it is only democratic politics thatcan contribute significantly to the shape of that adjustment. In thatcase, the fact that economic reforms are a contested arena withinthe political space needs to be acknowledged, not denied.

Economic and Political Weekly June 26, 2004 2667

that an entire policy package is somethingthat the electorate has not expressedan opinion on.

Secondly, there is the conviction that re-forms, representing technocratic rationality,good sense and economic wisdom, mustbe isolated from political changes. How-ever dramatic and wide-ranging thepeoples verdict against a given govern-ment, it cannot or should not be interpretedas a verdict against reforms. Thus some-how, the sanctity of the reforms must bepreserved against political arguments. Thisin itself is a fundamentally undemocraticapproach insofar as it seeks to seal offeconomic policies from the contestedterrain of politics.

Third, when our analysts comment thatit is the distributional effects of reformsthat the electorate has voted against, andnot the reforms themselves, this raises twoquestions: first, does the average voteranalytically distinguish between reformsand their impact? Second, is it not possiblethat the unequal distributional effects, beingtargeted for criticism, are intimately asso-ciated with the logic of marketisationreforms? Thus the effort has been some-how to establish that, the distributionalinequalities can be a target of attack, butnot the reforms themselves. But, both inpopular perception and in actual fact, theremay well be a close connection betweenthe character and logic of marketisationreforms and their distributional inequities.To this point I return later.

The argument that has been used bysome analysts, for example, Pratap Mehta,is that poverty is not a reason for votingfor and against political parties . Thus, hisexample, that the rural poor of Bihar havecontinued to vote for the RJD, which hasdone nothing for them despite its pro-ruralpoor stance. The poor, therefore, it issuggested, do not vote on the issue ofpoverty or economic interests. Thus, thisargument, applied to states like AndhraPradesh and Karnataka, where highly pro-marketisation governments have beenvoted out of power, would mean that thereforms or their distributional impact, couldnot have been a factor in this electoralverdict.

Indeed, it must be recognised that atsome level there is a disconnect betweenpoverty of the masses, non-performanceof governments, on the one hand, andsupport for any political party in any givenelection on the other hand. In other words,there isnt a one to one direct relationship,a quid pro quo. For, there is also of coursethe fact that if indeed poverty andmisgovernance were the only factors invoting, it would be difficult for the aver-age, poverty stricken rural voter to vote forany party. But from that to move to theconclusion that the vote, in states like

Andhra and Karnataka, did not register, atleast partially, the voters disenchantmentwith the pro-market image of these gov-ernments, would surely be a fallacy ofinterpretation. The average voter in Andhraand Karnataka, may not have a clear conceptof economic reforms and its implicationsfor them. But it is also impossible to denythe enormous, almost intuitive backlashthat has occurred in these states against thepro-urban elite, market-oriented, IT-drivengrowth models, which prevented thesegovernments from paying minimum atten-tion to events like draughts, agrarian dis-tress, and farmers suicides. The defeat ofthese governments surely at least drawsattention to the obvious contradictionsbetween an elite-oriented growth modeland the imperatives of democratic politicsin a predominantly poor political economy.

But perhaps the more interesting patternthrown up in these debates is the reitera-tion of the well worn clich of reformswith a human face by the political class,and the reassertion by the intellectuals thatindeed reforms can be sustained by greaterattention to redistribution. The politicalusefulness of this clich can hardly bedenied. But at another level, we need tonote that even this dramatic electoral verdicthas not pushed our political and intellec-tual elites to address the question: do marketreforms and distributive justice presentunresolvable conflicts? If so, what are thoseareas? If not, what are the definitive institu-tional arrangements, which can addressthe seeming contradictions between wel-fare and marketisation? And what kind ofpolitics can continually sustain the uneasybalance?

But first of all we would need to beaware of the sharp edges of the reform-welfare duality, and to ask, do we have theinstitutional capacities to address thesetensions? It would be tiresome, but never-theless necessary, to remind ourselves oncemore of the structural nature of this dualityin a globalising economy, and the decreas-ing space of the state to initiate and imple-ment welfare policies. Where capital isfree to move anywhere, most often in searchof cheap labour, where is the basis to enacthumane labour laws? Where states mustwoo capital with lower taxes, the scope ofpublic spending on welfare necessarilymust shrink. Today, FDI has indeed be-come the mantra of economic growth. Yet,when multinational firms come in, theymust surely recast many institutions to suittheir search for profits? The disappearanceof collective bargaining and its replace-ment by individualised wage contracts isjust one example of such recasting. Thegrowth of exports has been a widely notedfeature of the past decade. Yet, at theground level, high growth driven exportsones, such as the frequently cited ready-

made garments industry, cannot be disso-ciated from the image of thousands ofwomen who work in garment factories incities like Bangalore, Delhi and Mumbai,with less than minimum pay, inhumanworking hours and the most appallingworking conditions. This growingworkforce exhibits a hopelessness thatgives a definitive lie to the optimism builtaround export-oriented growth.

When the Indian political and intellec-tual class express the pious hope for ahuman face to reforms, what they forget,then, is that the growth model now ispremised on structures which render thestruggle for welfare lost even before it hasbegun. For, it is not only the structure ofthe globalising model that makes welfarea myth, it is also that the space for welfarepolitics shrinks in this particular context.The shrinking of the organised workforce,the weakening of unions, unemploymentand casualisation, are widely noted fea-tures of globalisation. It is less often noted,that these emerging features of the politi-cal economy create a situation where thepolitics of welfare is necessarily weakened.The left can indeed act as conscience-keeper of the newly elected coalitiongovernment. But the CPI(M)s very ownWest Bengal is also attended similarly bycasualisation of the workforce, the disar-ray of unions, and declining public atten-tion to issues of poverty and deprivation.

It bears remembering that in the post-second world war situation, within ad-vanced capitalist countries, the welfarestate evolved within a framework ofstruggle enacted by strong trade unionsand social democratic parties. It is, then,politics, that domain of turbulence, ofseeming irrationality, inadequately com-prehended, unyielding to economic reform-ers models and formulaes, it is that do-main, driven by competing interests, ide-ologies, visions and imagination, that hadcarved out the necessary institutional spacefor redistributive welfarism within ad-vanced capitalism

Therefore, the sharp edge of the questionis not the Congresss verbal commitmentto human face, nor whether the left canprevent this or that privatisation project,but, is state-supported welfare indeedpossible in the present context? If thecontours of that possibility are shaped bya continuous adjustment between capitalsprofits, and public welfare, then govern-ments, and academics, need to be con-scious that it is only democratic politicswhich can definitively contribute to theshape of that adjustment. If that be thecase, the fact that economic reforms are,and should be, ensconced in politicalarguments, and are indeed, a contestedarena within the political space, needs tobe acknowledged, not denied. EPW