Dr. Manmohan Singh's Interaction with Television Journalists

Just finished watching Prime Minister Dr. Manmohan Singh’s interaction with the heads of television news channels in India.  It was an interesting one hour.  I admit that I am a fan of Dr. Manmohan Singh and really admire him for his gentlemanly demeanor and overall economic vision.  It is, therefore, not surprising at all that I was totally convinced in his favour and found echoes of my own thoughts in all that he said until he talked about the government subsidies for grain, fertilisers and kerosene.   His point was that the cost to the exchequer is a notional thing – if you were to say that the price of these items in the open markets would be much higher then, by corollary, the exchequer’s loss was great.  Similarly, the loss to the country in the spectrum case should be calculated in terms of what you take as the starting price point.  Dr. Singh, with this disingenuous argument you lost me!  How can you bracket these together?  The former are subsidies provided as safety nets to the poor (at least in policy) whereas the latter made the rich even richer.  Of all our astute senior tv editors privileged enough to have been invited to this interaction because “they control the world” only Prannoy Roy came close to the crux when he asked the PM if by his comments he meant that the 2G spectrum allocation had been subsidized by the government.   

Dr. Singh spoke about the assured work at Rs. 100/- per day to the poor and its adjustment for inflation in answer to the CNN journalist’s question regarding the effect of inflation in food prices on the poor.  This reminded me of a conversation with my household helper some days ago.  He told me that the scheme is very much in place in his town, and all able bodied young men who have had the enterprise to get out and find work in cities have given their job cards to others and appointed them to report for work in their stead.  The money is then split between the two and the contractor who turns a blind eye to the discrepencies in detail.  Think of it as entrepreneurship, compulsion of deprivation, or corruption; it is your choice.  I really don’t have the heart to judge them.  These are people who work without any health insurance, job security, or even recourse against exploitative contractors who might, in any case, not give them full wages mandated by the government.  The most well meant policies and schemes can be confounded by narrow-minded self interest. The difference between these small time contractors, and A. Raja is only of scale.