Populist not popular

Manmohan Singh may have asked petroleum minister Murli Deora to stand firm, but the possibility of a rollback in the prices of petrol and diesel still remains. The ill-considered, reactive response of the Left parties, some junior partners in the UPA, and the BJP led Opposition; which have been in the forefront of the rollback demand; is far from surprising. What is, however, unfortunate is that even the Congress Party has lent its voice to the rollback chorus. The reaction of the political class, driven by electoral populism and coalition management, is retrograde in content. Fast-clip growth, coupled with development and equity, cannot be determined purely by markets. Political intervention is imperative. Such intervention would be effective only when it manages to strike the right balance between the interests of consumers and the fiscal health of both public sector enterprises and the state. The under-recoveries of oil marketing companies (OMCs) had been pegged at Rs 73,500 crore, no thanks to the government’s decision not to raise product prices for so long despite soaring international crude prices. Such gargantuan under-recoveries could well wipe out the OMCs.
Both the state and the political class should impress upon people that finally the government would have to spend public resources to bail out the OMCs if the latter go into the red. It is doubtless a political party’s task to articulate the popular will. It’s equally its responsibility to mould that will in a progressive direction. Sadly, our political class has, for some time now, failed miserably on that score. The state, on the other hand, has also been unable to improve delivery. That has surely not helped enhance public trust. The degree of people’s regard for the public sector is always directly proportional to the stake they have in a nation’s political economy. A gross deficit of functional democracy plagues the Indian polity, and its public sector. A more holistic conception of popular politics will change that.


-- The Economic Times Editorial