With Food Security Bill, UPA signals it is election-ready
The food security provision has enormous redemptive power for a government that is tottering on the brink of collapse and has a pretty dismal record of governance and corruption to defend as it gears up for early elections.
In its broadest sense, the amended Food Security Bill, as cleared by the Cabinet on Tuesday, is something of an abstraction. No timeline has been set for its implementation, nor have the beneficiaries been identified - beyond the broad-sweep suggestion that it will cover two-third of India's population.
Yet, for all these limitations, which even supporters of the bill have pointedly criticised, the Bill - and the underlying social welfarist sentiment - is the Congress' political brahmastra that signals its readiness for early parliamentary elections, which appear to be an eventuality that is increasingly hard to discount.
In terms of political appeal, and the potential to sway large masses of the urban and rural poor, this provision has enormous redemptive power for a government that is today tottering on the brink of collapse and has a pretty dismal record of governance and corruption on which it will face an otherwise embittered electorate in a year at the most. For anyone outside of the urban middle-class stratum of society, the promise of 5 kg of foodgrains per month per person at a highly subsidised price of Rs 1-3 a kg is like manna from heaven.
And in much the same way that the rural employment guarantee scheme proved a game-changer ahead of the 2009 election, the Food Security Bill too has the potential, given the unchallenged view of unlimited entitlements as a force for good, to veer the political narrative in a manner that works to the Congress' advantage.
To see this measure as a political weapon is not an expression of cynicism, as its proponents have argued in the past. At its core, the measure is, of course, well-intentioned. Who can dispute the need for food security - or the right of the poor to a certain minimum level of nutrition - in an India where poverty is so widespread?
But when it comes to public policy, the road to fiscal ruin is paved with many such good intentions - and a mindset that dismisses any nuanced criticism of the fiscal sustainability of such grandiose schemes as "anti-poor".
As Firstpost has argued earlier, the goal of food security can be better addressed by ensuring jobs and incomes for people, enhancing higher food output by raising agricultural productivity, and creating a safety net to feed those who cannot do so themselves in distress situations. "But what the Food Security Bill does is to make the exception the rule" - it offers food subsidies to two-thirds of the population, practically for eternity.
Notionally, of course, a provision has been introduced in the revised Food Security Bill, under which the rate at which the foodgrains will be made available can be revised after three years. At a theoretical level, that gives the government of the day an exit clause to cut back the subsidy component embedded in the scheme. But the record on this score, of successive governments, shows that once subsidies become entrenched, they will never be taken away owing to political cowardice. Activists of the Right to Food Campaign have already started criticising this provision.
Coming at a time when the government is fighting to pull the economy from the brink of a crisis, and the risk of a sovereign rating downgrade has been heightened by the political uncertainty following the DMK's decision to withdraw from the government and offer it support from the outside, the Food Security Bill commits the government to picking up the tab in the future even though the final size of the bill is unknown. That is poor economics, and that it should come at a time of economic downturn is doubly irresponsible.
The other criticism by proponents of this Bill - that the rich too get "subsidies" (and therefore the poor are entitled to them) - is a straw man argument. It is possible, as Firstpost has done (here), to argue that the rich and the middle-class are unworthy of some of the more glaring subsidies - and simultaneously point to the fiscal unsustainability of the Food Security Bill. Likewise, corporate giveaways, which too Firstpost has criticised (here), cannot be proffered as an alibi for unbridled populism.
The bottomline: from now until the next elections, whenever they are held, the UPA government will perhaps face death by a thousand cuts, as smaller coalition partners look to leverage their political support for whatever they can get away with. The Congress still need a bit of time for its welfarist policies to gain popular traction - and perhaps for the economy to revive somewhat from the depths to which it has sunk.
In such a scenario, the prospects for responsible economic governance, always poor, have considerably worsened. It is the season for political negotiations, and everything is up for grabs. There will be carrots for some - like the promise of special status for Bihar, which Chief Minister Nitish Kumar sought as the 'dowry' for his political support - and sticks for others. Already, the screws are being turned on DMK leader M Karunanidhi, with the Enforcement Directorate hinting (here) that his daughter Kanimozhi faces the prospect of another jail term and seeing her properties attached. It is just a matter of time before he capitulates yet again.
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