A rural Indian
spending Rs. 22.50 a day would not be considered poor by a Planning Commission
whose Deputy Chairman's foreign trips between May and October last year cost a
daily average of Rs. 2.02 lakh
Pranab
Mukherjee's stirring call for austerity tugs at the national tear ducts. Prime
Minister Manmohan Singh has pleaded for it in the past and watched his flock
embrace it creatively. With the Finance Ministry even acting on Dr. Singh's
call in 2009 (economy class air travel, spending cuts), we are now in the
fourth year of our noble quest.
There are, of
course, several kinds of austerity. My pick would be the variety practised by
Planning Commission Deputy Chairman Montek Singh Ahluwalia. No one can
challenge Dr. Ahluwalia's commitment to austerity. Look at the way he's stood
up to the populist demand for a poverty line that makes sense. No pampering
people here. Spend Rs. 29 a day in urban India or Rs. 23 in rural India and you
are not poor. He's even asked the Supreme Court to uphold the imposition of
such rigour on hundreds of millions of his fellow citizens. One affidavit filed
by the Planning Commission defended a line of Rs. 32 (urban) and Rs. 26 (rural)
a day. Since then, the Padma Vibhushan awardee and some of his colleagues have
stuck their necks out to lower that further.
RTI queries
That Dr.
Ahluwalia practises austerity himself is evident from two RTI queries. Both
fine examples of RTI-based journalism, but failing to get the attention they
deserved. Both exploring the anatomy of his austerity. One was a story in India
Today (covering Dr. Ahluwalia's foreign trips between June 2004 and
January 2011) by Shyamlal Yadav. This journalist (now with The Indian
Express), has done outstanding RTI-based stories in the past as well.
The other, in
February this year, came from The Statesman News Service(reporter
unnamed). This one took out details on Dr. Ahluwalia's global forays between
May and October 2011. In that period, he undertook “four trips covering 18
nights [which] cost the exchequer a sum of Rs. 36,40,140, an average cost of Rs
2.02 lakh a day,” says the SNS report.
At the time this
happened, that Rs. 2.02 lakh would have been worth $4,000 a day. (Gee! Lucky
for us Montek was into austerity. Imagine what his expenditure might have been
otherwise). That is a daily spend almost 9,000 times greater than the 45 cents
cut-off point at which rural Indians would be doing okay, in his view. Or over
7,000 times greater than the 55 cents cut-off point for urban Indians that Dr.
Ahluwalia would find “normatively adequate.”
Now his spend of
Rs. 3.6 million (or $72,000) in 18 days might well have been his personal
stimulus to global tourism in that year. After all, the industry in 2010 was
still recovering from the ravages of 2008-09, as the United Nations World
Tourism Organisation points out. The U.N. agency found, on the other hand, that
2011 saw global travel revenues cross $1 trillion. The largest revenue
increases were seen in the U.S. and Europe (where most of those 18 days were
spent). The Indian public can rejoice over its money playing a humble part in
that recovery even while scorched by austerity at home.
The stats from
the Shyamlal Yadav's RTI are fascinating. To begin with, his findings show Dr.
Ahluwalia made 42 official foreign trips and spent 274 days overseas during a
seven-year tenure. That is “one in every nine days” abroad. And that's
excluding travel days. The India Today story found that his
excursions cost the exchequer Rs.2.34 crore. However, it points out that they
received three different estimates of the costs of his trips and charitably
went with the lowest. Also, said the India Today story, “it is not clear
whether the figures include the expenses incurred by Indian embassies abroad on
frills such as hiring limousines. The actual costs could be a lot higher.”
Since the post
he holds does not require so much foreign travel — all of it done, though, with
“the permission of the Prime Minister” — this is puzzling. That 23 of the 42
trips were to the U.S., which does not believe in planning (but then, perhaps,
neither does Dr. Ahluwalia), is even more puzzling. What were these trips
about? Spreading global awareness on austerity? If so, we'll have to spend more
on his travel: look at those revolting Greeks killing the Cause on the streets
of Athens. And even more on his trips to the U.S. where the austerity of the
affluent is striking. CEOs in that country took home billions in bonuses even
in 2008, the year Wall Street tanked the global economy. This year, even the
media journals of the super-rich in the U.S. write about CEOs destroying their
companies, jobs and more — and gaining personally from it. Millions of
Americans, including many who suffered home mortgage foreclosures, saw a
different kind of austerity. The kind the French increasingly fear and have
voted against.
When Dr. Singh
pleaded for austerity in 2009, his Cabinet rose handsomely to the call. Each
member added a modest million rupees a month thereafter, on average, to his or
her assets over the next 27 months. All the while, hard at work as Ministers. (“The Union Cabinet gets healthier,” The Hindu, September
21, 2011). Praful Patel excelled, adding on average, half-a-million rupees to
his assets every 24 hours in that period. Workers in Air India, under a
Ministry he headed much of that time, struggled to get their salaries for weeks
on end. Now with Pranab cracking the whip, there'll be even more austerity
going around.
Note the
bipartisan spirit of this austerity: in the past few years, Praful Patel
(UPA-NCP) and Nitin Gadkari (NDA-BJP) have hosted two of the costliest weddings
ever, with far more guests than seen at any IPL final. Gender-balanced
Spartanism, too. That was for Mr. Patel's daughter and Mr. Gadkari's son.
Their corporate
counterparts take it further. Mukesh Ambani with his 27-floor (but higher than
50 storeys) costliest residence in living memory. And Vijay Mallya — whose
employees in Kingfisher struggle for their salaries — who tweeted on May 5:
“Having dinner at Atmosphere on the 123rd floor of the Burj Khalifa in Dubai.
Never been so high up in my life. Awesome view.” That's probably higher than
Kingfisher is flying right now. Both own teams in the IPL. Which body has
received public subsidies (by way of entertainment tax waivers, for example).
That is, until the matter went to the Bombay High Court. There are other
public-funded austerities linked to the IPL — watch this space.
Wall Street
model
The corporate
world here generally follows the austerity model of Wall Street. There, nine
banks including Citigroup and Merrill Lynch “paid $32.6 billion in bonuses in
2008, while receiving $175 billion in taxpayers funds,” reported Bloomberg in
2009. It quoted New York Attorney General Andrew Cuomo's report on the subject:
“When the banks did well, their employees were paid well. When the banks did
poorly, their employees were paid well. When the banks did very poorly, they
were bailed out by taxpayers and their employees were still paid well. Bonuses
and overall compensation did not vary significantly as profits diminished.”
Note that
Pranab's austerity prayer last week saw the soothsayers of the super-rich
raging on TV that the deficit was all due to “one populist measure after
another.” That is, stupid things like trying to give people work, reduce hunger
or send children to school. No mention of the Plutocrat Populism which saw
about Rs. 5 lakh crore (roughly $100 billion at the time) being gifted mostly
to the rich and the corporate classes by the same Pranab budget in concessions
on Corporate Tax, Excise and Customs Duties. (See “To fix BPL, nix CPL,” The Hindu, March 26, 2012).
Sitaram Yechury pointed out in Parliament that these write-offs for the
super-rich exceeded the fiscal deficit by Rs. 8,000 crore. But it is the
‘populist measures' aimed at the poor that get panned.
Amartya Sen (The Hindu, Jan.
7, 2012) ruefully asks “why there is hardly any media discussion
about other revenue-involving problems, such as the exemption of diamond and
gold from customs duty, which, according to the Ministry of Finance, involves a
loss of a much larger amount of revenue (Rs.50,000 crore per year) than the
additional cost involved in the Food Security Bill (Rs.27,000 crore).”
Indians outside
the charmed circle of the meritorious know a different austerity. Food
inflation in double digits. Vegetable prices rising 60 per cent in a year.
Child malnourishment double that of sub-Saharan Africa. Families cutting back
sharply on milk and essentials. Massive increases in health costs bankrupting millions.
Farmers unable to afford inputs or access credit. A drinking water scarcity for
many, as more and more of that life-giving substance gets diverted for other
purposes. How much nicer to practise the austerity of the elite.
