Solving India’s Income Problem (Part 14)

Equality

In the context of equality, the Preamble spoke of status and of opportunity. India’s leaders have misinterpreted that (for their benefit) to mean redistribution. Instead of focusing on improving the lives of the poorest by giving them economic freedom, the Indian state has made redistribution of wealth a priority via taxation and hundreds of government schemes. The moment the interfering hand of government comes into an otherwise voluntary trade or exchange between two consenting individuals – that is when corruption is created. Instead of a liberal democracy, we then have a kakistocracy — a system in which the governments are run by the least qualified and the most corrupt.

The equality we need in India is that every Indian should be treated the same – especially by government and law. It means non-discrimination and non-interference. It means not taking from one and giving to another. Equality of opportunity will arise from Dhan Vapasi (economic justice) and economic liberty (freedom to trade and exchange). Equality will come when taxes are low and budgets are balanced so that government is limited to only its most important tasks (protecting property rights, maintaining law and order, and safeguarding the borders). Equality of status will come with growth which follows; no one asks surnames and caste in urban India.

This is from Parth Shah of CCS: “The governing principle of the Indian Constitution seems to be the group-differentiated rights and privileges based on religion, caste, tribe or backward status and even geography …    Two liberal or libertarian principles are most relevant … One, equality before the law—all are equal in the application of the law. The second principle … is that there should be no laws about capitalist acts among consenting adults. The state shall not intervene in any voluntary exchange between adults.”

What India needs is the generality principle in politics and governance which treats all citizens the same. Atanu Dey writes: “Generality principle is well-recognized in a court of law. All citizens are treated as equals and everyone is guaranteed equal treatment before the law. But in politics, the generality principle is not applied. It leads to what the late James Buchanan, Nobel laureate economist and public-choice theorist, called the “politics by interest.””

Atanu quotes Buchanan: ““Politics by principle” is that which modern politics is not. What we observe is “politics by interest,” whether in the form of explicitly discriminatory treatment (rewarding or punishing) of particular groupings of citizens or some elitist-dirigiste classification of citizens into the deserving and non-deserving on the basis of presumed superior wisdom about what is really “good” for us all. The proper principle for politics is that of generalisation or generality. This standard is met when political actions apply to all persons independent of membership in a dominant coalition or an effective interest group. The generality principle is violated to the extent that political action is overtly discriminatory in the sense that the effects, positive or negative, depend on personalised identification.”

Atanu adds: “Personalized identification has become something of a norm in India. Handouts are made on the basis of which religion a person professes, or caste that the person belongs to. This leads to political rent-seeking, the attempt by groups to seek differential benefits for themselves at the expense of other groups. This is not the worst of it, though. The worst part is that it fractures the polity and pits groups against each other. Politics thus becomes a zero-sum (or even a negative-sum) game in which certain groups benefit at the expense of others. What is lost in the ensuing conflict is the shared vision for the nation and a loss of communitarian values that are critical for social cohesiveness and peace. Its logical conclusion is a war of each against all or what I call a “cold civil war.””

The Constitutional Amendment India needs is what the US did with its First Amendment: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

This is the Equality needed for a prosperous India.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.