:: Paranjoy Guha Thakurta

Right is wrong and Left is right at the Centre

By Paranjoy Guha Thakurta

Jun 07 : GM, the acronym of one of the largest carmakers on the planet and a once-prominent symbol of free enterprise capitalism, today stands for "Government Motors". Here, in the world’s largest democracy, the economic agenda of Prime Minister Dr Manmohan Singh’s second government — as spelt out in the President’s address to Parliament on Thursday — could well have been drafted by Buddhadeb Bhattacharjee, the beleaguered chief minister of the (still) Communist-ruled state of West Bengal, if not some of his comrades in the Communist Party of India-Marxist (CPI-M) who withdrew support to the United Progressive Alliance (UPA) government on the issue of the nuclear deal with the United States.

No, one is not being facetious or too clever by half. The fact is Sonia Gandhi, the Prime Minister and his colleagues in the Congress have adroitly hijacked the substance of the economic policies propounded by the Left (including providing subsidised food grain to the poor) while maintaining a semblance of support for "reforms" (such as divestment of shares of public sector undertakings, appointing a regulator for pensions and attracting foreign investment) so that the ruling party’s corporate supporters are not unduly unhappy.

It may be convincingly argued that if Mr Bhattacharjee’s Left Front government headquartered in Writers’ Buildings, Kolkata, had not been so overly enamoured of at least one of India’s best-known capitalists and not been excessively supportive of some of Dr Singh’s allegedly neo-liberal economic policies while industrialising the state — remember how the CPI(M) flayed the government’s policy on setting up the special economic zones (SEZs) — the Communists may not have been so badly humiliated at the hustings.

The planet has indeed become unpredictable, and not just on account of climate change. Thanks to the ongoing worldwide economic crisis, preconceptions of what is supposed to be capitalism, socialism and communism are being turned on their collective heads, as are stereotypical notions of what is "public" and what is "private". If over 60 per cent of GM’s shares are owned by the government of the US after the company declared bankruptcy, how should one now define the character of the company? More than two-and-a-half decades after Rahul Gandhi’s late uncle took the initiative to set up the Maruti Suzuki car-manufacturing assembly line in Gurgaon, as recently as May 2007, the one-time public sector corporation witnessed the Government of India ending its formal association with its Japanese partner Suzuki Motor Corporation (SMC) by selling its 10.27 per cent residual stake in the Gurgaon-based company — the nationalised Life Insurance Corporation (LIC) is currently the second-largest shareholder in the company, after SMC, with a 12.5 per cent equity stake.

After alienating the Left by signing a nuclear deal with the US, many in India were taken aback by what Dr Singh said on September 26, 2008, as he sat beside former American President George W. Bush, in the Oval Office in the White House in Washington, DC: "Mr President… let me thank you very much. The people of India deeply love you. And all that you have done to bring our two countries together is something history will remember forever."

This was a time when Mr Bush had arguably become the most unpopular American head-of-state. Yet, was the nuclear agreement — or for that matter, US imperialism — at all an issue for Indian voters?

Socialism is still a dirty word in Barack Obama’s America. Yet, many would contend that Mr Bush was the biggest socialist in the world in recent times. After all, it was under his tutelage that the US government proposed a financial bailout package worth close to $1 trillion — roughly equal to India’s annual national income — to rescue a clutch of financial bigwigs on Wall Street whose greed and venality were to a great extent responsible for the present recession that is being compared with the Great Depression of the 1930s.

We in India drew a spurious differentiation between the "public" and the "private" sectors. Public sector undertakings often served as the personal fiefdoms of politicians and bureaucrats in power — the state thus became the "private" property of the privileged few. At the same time, private corporate groups prospered thanks to a generous infusion of funds from government-controlled banks and financial institutions. Thus, the losses of the public sector got translated into the profits of the private sector and, more often than not, the gap between the Right and the Left became obliterated insofar as economic policies were concerned.

Between the 1970s and the early-1990s, the Congress — never ideologically coherent in terms of its economic policies in the best of times — lurched from the pseudo-socialism of Indira Gandhi to the market-friendly policies of Dr Singh in his earlier avatar as finance minister.

It is often forgotten that almost all the brave new policies of "liberalisation" took place within a few months of the minority government of P.V. Narasimha Rao coming to power in June 1991. Thereafter, in the face of criticism from within his own party, Dr Singh proceeded rather slowly, while enacting fresh or "second-generation" economic "reforms".

Academics like Peter deSouza, director, Indian Institute of Advanced Study, Shimla, have argued that the centre of India’s polity shifted distinctly rightwards through the decade of the 1990s. As in politics, so too in economics, the country’s "grand old party" has now returned to occupy the centrist space, but with a difference.

The Left may rightly claim that it stalled attempts by the Congress-led UPA to integrate India’s financial sector more closely with the rest of the world, thereby insulating the country’s economy somewhat from the worst ravages of the global recession. Today, out of power, the Communists can watch helplessly as the Congress plagiarises its economic agenda and takes all the credit it can for it.

Paranjoy Guha Thakurta is an educator and commentator based in New Delhi