| 26 January 2004 | Monday | 03 Zilhaj 1424 |
'Sub kuchh luta ke...'
What aggravates poverty?
A top Iranian leader was once informed by his advisers that the economy was not doing well, unemployment was rising and people were getting disaffected with the revolution. His terse but authoritative reply was that the revolution was not about the bread and butter; if it were so there was no reason to overthrow the Shah. The revolution was about Islam.
Historically, leaderships, whether in Iran, United States or any other country, have often been tempted to dictate national priorities, and it is usually those where they can either claim certain moral sanction, or hold out promise to lead the nation effectively, satisfying collective concerns and desires. Sometimes, however, the priorities are thrust on nations by circumstances and the leaderships are forced to deal with them as they come.
Uniquely, there has been a little of each of the above in the Bush leadership which has virtually become a single issue. The issue is no doubt terrorism. Of course, to be fair to him, the challenge was thrust on him. But it fitted the man's ability, political profile and combative personality on whom the formative influences had been very conservative, even hawkish. So when the September 11 tragedy fell, Bush was the man of the hour.
Bush and the conservatives surrounding him, who had been waiting for political power and the right moment for nearly two decades, were tempted by the opportunity offered by September 11 to overreach.
What started as a Bush family vendetta, pre-dating the WTC tragedy, as confirmed by former Treasury Secretary Paul O'Neill in a recent book, and by Senator Kennedy in a CNN interview, the regime change in Iraq merged into a larger campaign against terrorism, broadening public endorsement for the effort. Iraq and terrorism were rolled into one, and became the number one national priority. This is what the Bush White House wanted to do, and were capable to do just that. The challenge responded to their aims, and fitted their abilities as much as the limitations.
Bush administration is a matrix of multiple political strands - ideologues, evangelists, special interests, the hold-overs from the Reagan, Bush-1 era with strong and long standing ties to big business, specially oil, and career lobbyists for Israel.
Their interests may diverge but the approach is similar. They believe in the uncompromising use of unchallenged and unrivalled American power in pursuit of maximum national interests, to be defined more by their own personal agenda than by any objective conditions. The campaign against terrorism, of which the Iraq war was made the centre-piece, has provided a useful umbrella covering up this blatant linkage between the personal and the national. It has thus subsumed many agendas into one.
Of course, the President himself has only one personal agenda, that is his re-election, an obsession whose origins go back to his father's failure to win a second term. Incumbents usually stand or fall on their record, which becomes the campaign issue, and will be specially so with Bush who has made the national security the sole national priority.
The issue has released strong emotions in the country. Initially, in the wake of September 11, the emotional outpouring was in support of a strong leader. Of course the Bush Administration took advantage of this "heavy mandate" to fulfil its own agenda, a work already in progress.
Those who argue that Bush was misled by a faulty intelligence are missing the point. The decision to go to war was not based on the intelligence, rather the intelligence was based on the decision to go to war. No leader in a democratic country can take the nation to war without finding a rationale adequate to people's commitment to sacrifice human life and suffer economic loss. War is not a trivial matter specially in societies where public opinion matters.
Since there was no sound rationale for going to war, Bush had to invent one. And its magnitude could not have been any less than the threat of weapons of mass destruction. and terrorism. If this threat may have looked fictional, remote or implausible, it had to be doctored, or created de novo, if the need be. And that is what the Bush-Blair combine proceeded to do - adapt the intelligence to fit the political requirement.
Look at the arguments presented even by as decent and honourable a man as Powell. Skimpy and unverifiable facts were stretched to project a phenomenon as a threat, and then other remotely connected and dimly discernible threats were added, and the cumulate effect went on to create an impressionistic reality of an imminent and magnified danger to national security.
No one bothered about the moral, legal or broader strategic issues involved except some liberals who were put in a tight spot because the war aims were so defined, by giving multiple rationales at various times, as to make the criticism unpatriotic. The ruse worked, till the body bags started coming home and the horrendous financial cost of the war became known, that is.
It is clear that whatever the criticism on the war, for Bush the main national issue remains national security. And he would try to project his leadership role in meeting this challenge. He has confirmed this in his latest State of the Union address whose message was very clear - America is at war ,and he is the best war-time leader.
And he continues to get high marks from the average Americans for the strong leadership provided by him in confronting the terrorist threat. This is how he won the mid-term Congressional elections and this would be his main campaign plank for the Presidential race, specially when the question marks remain over economic recovery rendering its value as a campaign issue dubious both for the President and the Democrats.
The war offers both an opportunity and a risk to the Democrats in their bid for the White House. They have a very impressive array of candidates vying for the nomination reminding the voters that the American idealism is still alive despite the grievous assault by the Bush administration. They too would like the focus to be on the national security because of the economy's uncertain outlook.
If anything, the economy may improve thus robbing them of an issue mid-stream through the campaign. Of course, the Democrats are also trying to play up the social issues such as medicare, medicaid, education, environment, gay marriages, the question of civil union, etc but are finding it hard to strike a right theme and arouse much public excitement.
The real campaign agenda will, therefore, remain narrow. It will be almost like a national referendum on a single issue. What can the Democrats do to win the national debate and thus win the election? I am afraid nothing much on their own. The success of the Democrats' strategy of criticism of the war depends on the failure of the war, and thus of the Bush administration.
The die has been cast and the initiative remains with Bush now to direct the Iraq war, if he can, to make a success or failure of it. And then there is always the outside factor - an unforeseen terrorist attack or any other epochal event, in Iraq perhaps, which Bush will have to deal with, to his advantage or disadvantage. In the final analysis whether the war effort will fail or succeed will be self-evident, there is nothing the Democrats can do to change the public perceptions of it. The strong and powerful media will do it for them. All this will obviously make the election as Bush vs Bush.
America has changed significantly in recent decades. The country has always been politically pluralistic, but is becoming somewhat polarized specially under George Bush whose extremism, the influence of the Christian Right and conservative talk-show hosts, and the avaricious corporate sector are dividing Americans from Americans. But ironically Bush has also united the nation on one issue at least.
Even polls as late as on the eve of Iowa Caucus, on January 19, show that most Americans still consider terrorism as the number one national issue, ahead of economy and jobs. So the only way to defeat Bush is for him to defeat himself.This will be specially so because the Democrats are divided.
Firstly, their committed supporters in the country are declining and their traditional coalitions are unravelling whereas the Republican support is rising. Even the industrial unions, traditionally the Democrats stronghold, do not seem to be as activist as before. Elections in the US have become increasingly a money and media game and a big power play by special interests. And the Republicans are better financed than the Democrats.
The Democrats have another problem. They are divided on the very issues that they need to attack Bush like the war and economy. On war, for instance, one or the other candidate who attacks his rival candidates ends up making arguments that unwittingly support the Bush position. So they end up diluting the argument against Bush. On economy as well they are not coherent, some supporting the tax cuts, some opposing, and some coming on strong on social issues. So they have been beating up on each other. That also erodes the strength of criticism against Bush.
In sum, at this point of time, both the war and the economy, which is always an issue in the election, are in a holding pattern. If one is to hazard a guess, both are likely to evolve in the opposite directions. Economy might improve while the war situation might deteriorate. This will make the race a very tight one. For Bush to win, both the war and the economy have to be looking up. And by the same token for the Democrats to win both should be bad news. The writer is a former ambassador.
E-mail: touqirhussain@yahoo.com
'Sub kuchh luta ke...'
This is the age of thrust and grind to the beat of thump and clatter, so I suppose no one remembers a velvet voice of the 1940s and 1950s called Talat Mahmood. Like velvet, Talat tended to be one-dimensional, and was often derided as cinema's answer to insomnia.
But on a good day, Talat was incomparable. A song that still haunts my senses begins with an imperishable line: 'Sab kuchh luta ke hosh mein aaye to kya kiya...' What is the point of coming to your senses when all has been lost?
It echoed and re-echoed in my mind when I saw Sonia Gandhi standing beside Sharad Pawar. The strained smile on their faces was more eloquent than any words they said. For 250 weeks the two have been on either side of an emotive, but important, line: the foreign origins of Sonia Gandhi. Do they expect everything to be forgotten in the 10 weeks left for a general election? Leaders might find it convenient to forgive; the voter does not forget.
Five years ago, Sonia Gandhi hounded Sharad Pawar out of the Congress because he suggested that the Indian voter would be apprehensive about her inability to communicate, and wonder why she lived in India for 16 years after her marriage to Rajiv Gandhi but could not find time to acquire an Indian passport. It was never a question of religion. Their Christian faith does not make George Fernandes or P.A. Sangma or A.K. Antony unacceptable.
For five years the primary purpose of the Congress has not been to remove the government, but to make Sonia Gandhi Prime Minister. There is a subtle but vital difference between the two objectives. It is the difference between Opposition politics and coterie politics. After 250 weeks of seeking the first objective, the Congress has kept aside 10 weeks for the second objective.
The problem is not the wish, but wish fulfilment. Sonia Gandhi believes that a fudge will work. Privately she has assured Sharad Pawar and other opposition parties like the DMK and the CPI(M) that she will not be a candidate for prime minister. Publicly, Congress spokespersons are under instructions to say that such questions will be dealt with after the elections. I hear that the principal spokesman, S. Jaipal Reddy, was pulled up because he insisted that Sonia Gandhi was still the only leader the Congress would accept as prime minister.You cannot blame Jaipal Reddy: this is the line he has been plugging ever since he was given the honour of speaking on behalf of the party. (Jaipal, whose friendship I can claim, is not a natural Congressman; he is intelligent but not a sophist. In fact, he remains one of the most brilliant stars of his generation. Ever since he has become a Congress spokesman, his brain has been mortgaged to his tongue, rather than the other way around: I know the feeling and sympathize.)
Even after humiliation in the last Assembly elections, all Congress leaders sent to television studios insisted that their belief in Sonia Gandhi was non-negotiable. Sonia Gandhi herself left no doubts on this score, while those closest to her, like Ambika Soni, were vociferous. As late as in December, she was saying that the BJP seemed scared of a "mere woman". It is a somersault to now suggest that a "mere woman" is scared of the BJP.
There is no need for others to be discreet. As his colleague P.A. Sangma correctly points out, Sharad Pawar cannot accept Sonia Gandhi as any alternative coalition's leader without compromising on his party's basic constitution. Democratic politics does not provide space for "private" assurances on public policy. This is why Pawar has said that any secular front against the NDA must accept the principle of collective leadership.
It was the question of leadership that prevented the formation of such a secular front at least a year, or even two years ago. If you want to be a front, and secular, what better opportunity could come your way than the Gujarat Assembly elections after the riots? There is reason to believe, after analysis of the vote, that such an alliance would have defeated Narendra Modi, and reshaped the swell of Indian politics. But Sonia Gandhi spurned all suggestions of an alliance and mounted a soft-Hindutva plank. It was only after the results of Madhya Pradesh, Rajasthan and Chhattisgarh that the fantasy began to evaporate.
The key question now is: Has everything been lost, or is reversal possible? Is it 'Sab kuchh luta ke' or merely 'Bahut kuchh luta ke'? The very idea of unity has brought a spring to the Congress step, but before taking a leap, a few facts need to be placed in perspective.
Two years ago, the Congress would have been the central glue of such a Secular Front, because it was still a closed fist: the hollow within had not been exposed. Today, the Congress will be isolated if it contests alone, and squeezed if it opts for an alliance. The Left has been Sonia Gandhi's most loyal ally, but it will not concede a single seat to the Congress in Bengal, Kerala or Tripura. What the Left does elsewhere does not much matter.In Bihar Laloo Yadav will give unto Congress banter, and keep unto himself all the seats. The Congress share, out of 40, will be in single digits. In UP, Mayawati bargains like a moneylender: whatever she gives will be at high interest. The DMK has fewer problems, because the Congress is already marginalized in Tamil Nadu. Congress will get a better deal in Maharashtra, but that is a bit of a Barmecide's feast: neither Congress nor Sharad Pawar will be able to retain the number of seats that they have in the present Lok Sabha. Every Congress ally will be expansive with words and miserly with seats.
On the two issues central to the BJP campaign in the coming elections, peace with Pakistan and prosperity in India, it has had very little to say. There is no alternative economic policy that has been articulated. And on a subject as important as Pakistan, there is dead silence.
The Congress needs internal strength far more than external support. Sharad Pawar should be inside the party, discussing strategy with outsiders, rather than outside discussing options with Congress. If the Congress is run on traditional lines of rotating presidents and a muscular working committee, all the bits and pieces that have fallen off over the years will return. A political party is a collective, not a fiefdom.
The sight of a leader, who once waited for the world to call on her, flitting about from home to home is indicative of disarray. But once again, what would have been effective a year ago, seems desperation 10 weeks before the polls. Against such disarray, the BJP enters this election with only one problem: the cockiness of those of its second-generation leaders who are beginning to behave as if they have already won.
The BJP has dismounted from the Ayodhya rathyatra, and climbed on to the Vajpayee chariot. The wheels of the Vajpayee chariot are not a temple and a mosque, but economics and peace. It is a formidable vehicle, driven by a leader at the top of the popularity charts. The positive response to the Pakistan initiative proves that Vajpayee is correct in his belief that while conflict might get votes, peace can reap a much higher dividend. His biggest problem might be complacency: he needs to restrain his party from getting too clever by half with leaders like Jayalalitha.
As Talat Mahmood also pointed out, albeit mournfully, there are two kinds of fire. There are the 'ummeed ke chiragh': the lamps of hope must never go out in the Congress. Alas, their dilemma might be better summed up in a line that Jaipal Reddy, who is from Andhra Pradesh and will therefore be familiar with Urdu, the language of the old Nizam state, will understand: 'Khud hi laga ke aag tamashai ban gaye...' It is difficult to translate the nuances of Urdu into English, but let me give it a try: We have become spectators of a fire we ourselves lit. The writer is editor-in-chief, Asian Age, New Delhi.
What aggravates poverty?
The Pakistan Society of Development Economists holds an annual conference, which is organized by Pakistan Institute of Development Economics (PIDE). Social scientists and economists from all over the country attend it and speakers are drawn from around the world but mostly from within Pakistan. The theme of this year's Conference was 'Institutions, growth and poverty.'
Poverty has become a buzzword in Pakistan and as one of the speakers stated "estimating the poverty line and poverty trends has become the fastest growing cottage industry in Pakistan." The phrase "cottage industry" was very aptly used as when non- rigorous analytical techniques are applied to low quality data by Pakistan's poverty pundits the results are bound to be sub- optimal and contradictory.
The chief beneficiary of this cottage industry is PIDE as it holds all its poverty seminars at Bhurban hills as if poverty cannot be meaningfully discussed on the plains, but PIDE wants its discussions to remain misty and cloudy like the atmosphere in Bhurban. The debate on the scale of poverty i.e. whether it is 32 per cent as claimed by the government or 36 per cent as claimed by other researchers is rather meaningless because any level above 20 per cent is grave and its reduction below that level should be the primary target of economic policy makers.
The discussion on definition of poverty is equally inane as the most scientific definition is of calorific value. It has been correctly estimated that a Pakistani needs to consume 2,350 calories in order to sustain a healthy physical existence. It has also been estimated that at current prices, 2,350 calories cost Rs 25 daily. Hence a family of six needs to consume food worth Rs 4,500 per month for their healthful existence. Hence any family spending less than Rs 25 per capita daily on food is living below the poverty line in Pakistan. The other definitions of $1 per day at purchasing power parity are neither precise nor so relevant for estimation and policy purposes.
Many unanimous conclusions emerged from the papers and the discussions in the conference. Firstly, it was pointed out that what is important for reduction of poverty is not GDP growth per se but growth in per capita income. The experiences of Pakistan and India in 1990s are relevant.
Up to 1990, Pakistan had a higher GDP and per capita growth than India but the trend reversed in 1990. From 1990 to 2000, Indian GDP grew by more than six per cent, population grew by less than two per cent, hence per capita GDP grew by more than four per cent and the poverty level was reduced from 46 to 24 per cent.
In the same period Pakistan's GDP grew by 4.4 per cent, population grew by 2.2 per cent, hence per capita income grew by slightly more than two per cent and the poverty level increased from 18 to 32 per cent. It was also the consensus that unless per capita income increases more than three per cent, it does not trickle down to have an impact on reduction of poverty.
This year India is expecting a GDP growth of more than seven per cent and per capita growth of more than five per cent, despite agricultural subsidies and a budget deficit of 10 per cent of the GDP. Pakistan will hardly achieve five per cent GDP growth because despite large scale manufacturing growing at 8 to 10 per cent, agriculture is in the doldrums.
The federal minister for labour who is also a big farmer stated in the conference that cotton production this year has declined by one million bales and unless we get a bumper wheat crop, the GDP growth will remain short of five per cent and per capita income short of three per cent and there will be no dent in the high level of poverty.
The second factor which was stressed for reduction in poverty is the importance of growth in the agricultural sector as distinct from industry and services. As rural poverty level is higher than urban poverty, unless agriculture grows by five per cent or more, rural poverty is not likely to decline. Hence we need a strong policy package for spurring agricultural output but the present government seems to ignore it.
The third conclusion was that a rise in employment is necessary for eradication of poverty. It was pointed out that export growth, which is welcomed by economists of all shades, and is mostly in the organized sector is a jobless growth. Employment-intensive development works at the local level need to be encouraged and the new devolution plan in Pakistan was conceptually considered to be good for generating employment although its practical results have not yet come out.
The fourth conclusion of the conference was, as Dr Hafeez Pasha put it, "Despite what the boffins of the IMF and mandarins of Pakistan may say, higher public investment does not crowd out private investment." In fact public and private investments in developing countries are complementary as they reinforce each other; because with better infrastructure and more trained manpower private investment becomes more profitable. In Pakistan public sector investment fell from seven per cent in 1980s to an average of three per cent during the last four financial years. This has dragged down private investment, GDP growth and per capita growth and has aggravated poverty.
The last interesting conclusion of the conference is that inflation within limits i.e. less than 10 per cent does not aggravate poverty. The common perception is that inflation hurts the poor fixed income groups more than the rich whose assets value increases with inflation. But the empirical evidence shows that it does not matter that much as far as overall poverty is concerned. Pakistan's experience of the 1970s was indicated to prove this point.
In 1970s the average rate of inflation was more than seven per cent. The average GDP growth was about five per cent but the poverty level from 1970 to 1980 fell by almost 10 per cent. This was also due to the pro-poor policies followed in that decade as compared to the apathetic policies being pursued at present.
The upshot of the conference was that bad institutions and a growth of less than three per cent in per capita incomes aggravates poverty. The above conclusions were based on empirical data pertaining to many countries over a long time period. The present policy makers instead of gloating over reduction in the fiscal deficit to 4.5 per cent of the GDP should accept the blame with other policy makers from 1988 onwards who have pushed twenty million more Pakistanis into the horrors of poverty. Poverty was an abstract concept in the Crystalball Room of the Marriott Hotel as the organizers could not find a single speaker who was living below or anywhere near the poverty line. The writer is former secretary planning, government of Pakistan.