An old Chinese saying (I assume all Chinese sayings are old except the ones that come from the little Red Book) goes:
If you are planning for a year, sow rice; if you are planning for a decade, plant trees; if you are planning for a lifetime, educate people.
In the context of development, I think the last bit should be “if you are planning for a nation, educate people.” Especially, primary education. For among all the factors that are necessary for economic development, none is so basic as primary education for a nation. Primary education is the essential basic public good engredient without which there is no known receipe for development.
Everything else, all institutions required for development — from markets to democratic government to legal systems to law enforcement — require an educated populace for their functioning. In the absence of widespread literacy, a nation has little hope of achieving anything at all. Education is not just an instrumental good (for achieving development) but it is also a final good, an end in itself for it allows humans to be more fully human.
It is India’s misfortune that its leaders have neglected that fundamental truth. So we have the largest number of illiterate people of any nation in the world. Literacy, though distinct from education, is closely related to it. Without a literate citizenry, the so-called freedom of the press is an absurd notion. Without an educated population, our so-called democracy is a mockery of the ideal.
To explain the dismal state of the Indian economy, one would be well advised to look closely how the Indian government addresses the question of education. To understand why the government takes the position it does regarding education, one would have to look at the history of India. I would like to present the bare outline of my argument about the Indian education system, why it is elitist, and what that implies for the development of the economy.
First the history. India used to be a very rich nation a few hundred years ago relative to the other nations. That is why India got plundered repeatedly. The latest to arrive were the Europeans and finally, the last to establish their colony were the British. Their goal was to extract the wealth and do so efficiently. They were not in India for India’s development, and understandably so. Why bother with development of brown-skinned heathens?
The British therefore were interested in extractive systems, not developmental systems. Development requires universal primary education. During the course of the British Raj, the level of literacy dropped. From a largely literate and educated population, India became largely illiterate.
However, the British were few in number and a vanishingly small number of them were in India. So they had to delegate the massive task of administering this vast land with the primary purpose of extracting wealth. That delegation required an efficient bureaucratic machine that would control every aspect of the Indian economy from the top down. That bureaucracy would have to prohibit the natives from ever being economically free. By design, the machinery was meant to make the natives dependent upon it for favors. That is the genesis of the administrative bureaucratic machine that India got from the British.
The bureaucracy was in effect a straitjacket that held the Indian population immobile while the British plundered the land. But since the British were few in number, they needed to have surrogates to run the bureaucracy. They therefore trained a very very small number of natives and created an elite core that worked the bureaucracy for the benefit of their pay-masters, the British.
Thus you had a divide — that yet persists, and how. But I am getting ahead of myself. The divide was a literacy and education divide. An elite few were educated so that they could run the machinery and the rest were deliberately kept uneducated so that the country could be more effectively and efficiently exploited.
The extraction party went on for a while. The land yielded its wealth but nothing is inexhaustible. The land was becoming barren. It was getting harder to extract wealth, as the country slid into poverty. For the first half of the twentieth century, the GDP of India grew at a negative rate. Every year from 1900 to about 1950, the economy actually contracted.
Not just that, colonialism was going fast out of fashion. So the British decided to leave. They could read the writing on the wall, and they were not dumb. samajhdar ko ishara kafi hota hai. They left the building on August 15th, 1947 and on their way out handed over the keys to the Congress Party. The Congress were delighted. They decided that the British were really nice folks. They missed the British. So they said Nehru is close enough.
The important point is this. The British left the building but the building continued to be exactly what it was and the inhabitants of that building continued to be exactly the same as when the British were there. The bureaucratic machinery, the command-control-extractive bureaucracy persisted just as before. It was an institution that the Congress — the faux British — were only too eager to take control of. The directive to the bureaucracy was the same: Don’t allow the filthy natives any freedom to do anything without getting permission for every little thing.
Every little freedom that we are denied in India, just look a little closely. It is the dead hand of some Britisher reaching through the Indian bureaucracy to prevent you from doing something or the other. I was in a two-bit town in Bihar visiting a little shrine where the Buddha supposedly died. I was told that I could not take a photo graph of the crumbling little temple. Totally mind-boggingly astonishing.
Want to listen to the radio? Sure, go ahead, the government will provide you the programming. It will tell you what you should hear. It will tell you which books you can read (if you are among the chosen few who can read, that is.) The free press? Means precious little for the larger proportion of the country that is illiterate.
Every avenue of production — the government will have control. From power to railways to steel mills to telephones to grain silos. And of course education. But that last bit (and I am coming to the point that I had started off to make) has an interesting twist: education only for the elite. Educate the elite alone so that the unwashed masses will be more easily controlled. The masses will continue to vote for the corrupt political parties only if they don’t have access to information. Control their access to information and you have control over their destiny.
It is the information divide that was instituted by the British and it persist under the able stewardship of the subsequent government (largely the Congress) though the efficient bureaucratic machinery that control every aspect of the Indian economy. (Liberalization is a recent phenomenon and that is another story.)
If we were to posit that the objective of the educational system in India is for the elite alone so that they can control the rest of the country, a number of features of the system can be easily explained. For instance, the emphasis on higher education (IITs, etc) and the neglect of primary education.
The middle class and upper classes spend their own money to give their children fine primary and secondary educations. Then these children out-compete the children of the poor people and enter institutions of higher learning where they study at the expense of the toiling masses. Higher education (until recently) was largely free.
And then there is the so-called brain drain. I say so-called because it is a total misunderstanding of the fact. India is not deficient in brains. Even if 200 million brains were to magically vanish from India, we would still have more number of brains than the combined brains in the US and Western Europe. What India lacks is resources for education. And when 10,000 educated doctors, engineers, scientist, teachers, etc, leave, they represent a resource drain. That is a capital drain that India can ill afford. It is embodied capital which required resources to produce.
Economists measure cost of doing something as the opportunity cost : what is the cost of foregoing the best alternative use of the resources employed. Say, you could spend Rs 10 lakhs of public money to educate one engineer at an IIT. Suppose the best alternate use of that money was providing education up to the secondary level to 100 rural children. The opportunity cost of educating one IIT engineer is then 100 rural children’s secondary level education. What are the effects of this?
I believe that over all effect of educating an IIT engineer at the cost of 100 rural children is bad. I will defend that claim in the next few articles. I will address questions such as IIT engineers who go abroad repatriate dollars and technology and other such pitiful objections. I must hasten to add that I am not advocating abolishing higher education; that would be the last thing on my mind. I am arguing that public funds must not be used for higher education at the cost of neglect of primary education.