Need for respectful and constructive conversation

Pranab Bardhan

EPW Perspectives November 26, 2005

In the discussion of economic reforms in academia as well as the media in India one finds a wide gulf between the opposing sides, and in some quarters there are even signs of increasing polarisation. Each side describes the other in stereotypes and usually talks past each other. The pro-reformers identify the opposition as belonging to the “loony left”, caught in a time warp, oblivious of global changes and elementary economics. The other side paints the reform-mongers as “neo-liberal” (a widely used term of abuse in certain circles) and lackeys of global capitalism oblivious of the poor and the dispossessed. Beyond these stereotypes there, mercifully, exist good many people who have problems with both extreme positions, and, of course, they themselves are somewhat divided. The issues involved are sufficiently important for us to engage our respective intelligent opposition in serious conversation.

Many economists and columnists in the financial press are not aware how unpopular, rightly or wrongly, the reforms introduced since 1991 are with the general public. (Politicians are, of course, too savvy not to notice this. Even politicians in any ruling party over the last decade who support reforms play them down during election time; a party that initiates some reforms is quick to oppose them when out of power. This duplicity is also currently in display within the Left: in the states they are in power, they are often driven by the inexorable logic of fiscal near-bankruptcy and competition for investment to be pro-reform; but in Delhi the unelected leaders of the same party can indulge in ideological grandstanding.) In a country where there is very little social protection for the manual workers and where their lives are brutalised by the lack of economic security, economists and journalists who preach the benefits of market competition and free trade have an obligation to argue at the same time for adjustment assistance programmes that can help these workers in coping with job losses and getting retrained and redeployed.

Reform would have been more popular if it were equally and simultaneously concerned with reform in the appalling governance structure in the delivery of basic social services for the poor that we have in large parts of the country (in education, health, drinking water, child nutrition, etc). On the other side, for those who fundamentally object to market reforms as a sign of our drift away from basic socialist or communitarian goals, it is incumbent upon them to show viable, incentive-compatible, and thus sustainable ways of constructing alternatives to capitalism in different sectors of the economy. They have so far come up with very few new constructive ideas and history has not been kind to their old ideas. Above all, there is a great need for respectful and constructive conversation between the contending groups, instead of the mutual snipping that is much too frequent. Email: bardhan@econ.berkeley.edu