Atanu Dey On India's Development

The AP results are in: Chandrababu Naidu is out

Andhra Pradesh (AP) election results are in and Chandrababu Naidu is out. He was an unusual CM. He wanted to make Hyderabad into a Singapore, and make AP a shining state. From what I hear, it appears that his stress was on the use of hi-tech for bringing about transformation. I am not too informed about what the game plan was but it appears that the common person did not obviously share his vision and they voted him out. Perhaps he fancied himself to be a Lee Kwon Yew and did not realize that unlike the Singaporean dictator, he had to seek a mandate from the masses. The masses are more interested in the short-run rather than the long-run.

Social planners face a difficult task in the context of a ‘democratically’ run economically backward state. To win the mandate of the masses, they have to give handouts to the people. Given limited resources at the disposal of the government, the choice is often between doling out the resources to the masses for short-term consumption needs, and using the resources for investment for future growth. To the masses living close to subsistence, short-term consumption wins over long-term investment.

Alexander Fraaser Tytler wrote in his The Decline and Fall of the Athenian Republic (1776)

A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy followed by a dictatorship. The average age of the world’s greatest civilizations has been 200 years.

I am convinced that any social planner within a democracy who does not promise and deliver government largesse to the masses, is not going to hold on to his job for long. Will dictatorship follow inevitably? I am not sure of that. The next social planner will learn the lesson and to maintain his job, he will focus on the short-term and hand out goodies to the voters at the expense of long-term growth.

The lesson? Beware of boundary conditions and corner-solutions. When you hit the corners, the usual rules don’t apply. The function is not differentiable at that point.

  • http://www.ramdhanyk.com Ramdhan Kotamaraja

    Hi Atanu,

    Well Andhra Pradesh voters did support CBN and his policies. They gave him a chance by voting him to power with a huge majory for his second term, with a hope that this working CM will change their lives. Wel, CBN did do lot of work and helped to change the face of IT/Services industry in India, but he ignored the common man who voted him to power. I would say he actually betrayed them by completely neglecting irrigation and agriculture sectors and he faced the verdict.

  • http://www.worldisgreen.com Suhit Anantula

    Atanu:

    I am shocked at the results in AP. That Naidu was losing was evident from the exit polls but the extent of the loss was striking.

    The problem as you pointed out is of balancing the short term and the long term.

    There has been unequal development in AP, that is true. But people tend to forget that AP, which was not even in the reckoning of top states in India, in fact according one survey 22nd 8 years back has climbed to the 3rd best state in a decade under Naidu.

    What he has done is attracted the best companies, showcased what can be done by providing Hyderabad as an example and bringing in better governance and reforms. And this is a slow process especially when your own government employees do not want to work hard.

    Hyderabad has been the cleanest city in India, voted twice. There has been no communal riots in Ap, especially Hyderabad in this time.

    The sad part of his defeat is the alternative, Congress.

    YSR, who is going to be the chief minister, is considered the father of the bomb culture in cuddapah. People make bombs at homes, crude ones though in these places.

    The congress leaders have been talking of a responsive and responsible government. Just words. No action plans and even a path towards how they are going to achieve their goals.

    As you said it, they have come back to power on the basis of free electricity and other goodies. Costing Rs. 2,500 cr loss and this just the start.

    On top of this is the Telangana problem. TRS, the party wanting the separate state, is ready to spill blood to achieve this.

    So here we are. Back to bloodshed, bombs and caste and communal politics.

    I am sure AP will reach the 22nd place of the best state in the country very soon.

    Suhit.

  • Venkat Ramanan

    Hi,
    I completely agree with Atanu on his views on Indian Voter and elections. Indian voter is a moron, when he votes for a bihari who has leaked the question papers of sensitive national exams. that man has to be slippered and tortured whereas he moves around freely asking for votes. Is this democracy? The laws need to be more stringent and criminals have to be tortured but not innocent people. yes, Indian voters are morons, especially people in Tamil Nadu as they have voted back Jayalalitha to power knowing she would throw tantrums at all sections of the society! but, what is the alternative? will god come down and take part in the election? or will he be afraid he would also become corrupt if he does so? What alternative do we have?

  • Raj

    Did you watch NDTV last night? YR couldn’t answer a single question w/o saying “High command will decide”.! It was hilarious, but sad!

    And the first decision the govt will take is to provide free electricity to farmers. And who will foot the bill Mr Reddy? Your highcommand?

  • Ad

    “They have come back to power on the basis of free electricity and other goodies.”
    If this is their plan in AP, which they did in MP for 10 years and that resulted in MP electricity board to be nearly bankrupt and now MPSEB dont have enough electricity to provide to state. But atlast MP voters brought BJP in power because they just did not wanted free electricity but development. So this is very confusing no single pattern can be found out, in AP voters dont want development they want free electricity?? in MP voters did not wanted free electricity but they want development.

  • Swami

    Though the public has voted Chandrababu Naidu out of power it may not be justified for us to give a hindsight opinion on whether his strategy was right or wrong. He definitely tried to do something different and work towards the common good. In my opinion he did the right thing by focussing on improving the “Quality of Life” of atleast the urban population. Government organizational reforms, improvement in quality of roads, power reforms can be given as an example.

    He was also in the process of putting in place process and infrastructure to improve the “quality of life” at a village level by holding district collector’s accountable, creating an open and transparent public grievance mechanism. If he was given a chance he would have come out with more impactful schemes.

    In true CEO fashion he implemented things first where he would have more control and benefits would be more easily visible. This was important to keep his staff’s morale up. This didnt go down well with the masses.

    The public (as stated by Atanu) has gone for short term promises as compared to long term benefits. I read the following statement by Lord Acton. The timing could not have been better !!!

    “Moral defects lead to the loss of liberty. So we may say that it flourishes jointly with conscience. Decay of the one brings about decay of the other. Democracy undermines conscience by making men prefer what others think best to what they think best themselves. So it demoralizes like excess authority. It relieves men from the sense of responsibility and the duty of effort.”
    – Lord Acton

  • Kshatriya

    >Did you watch NDTV last night? YR couldn’t answer a single
    >question w/o saying “High command will decide”.! It was
    >hilarious, but sad!

    >And the first decision the govt will take is to provide free
    >electricity to farmers. And who will foot the bill Mr Reddy? Your
    >highcommand?

    The only reason YSR has been selected is because he is a Christian. Already Sonia has pushed for Xtian CM’s at every oppurtunity as shown by her forcing Ajit Jogi out of nowhere on Chattisgarh. Luckily the people of Chattisgarh were clever enough to throw Jogi out of office after suffering for 5 years under him.

    When YSR talks about High Command he actually means the Rome Raj at Delhi. The pope must also be consulted of course.

  • raj

    YSR is the worst CM AP will ever have in the history of politics.

  • Shankar

    Mr.Reddy is the best CM of AP. He always supportive to the Rural AP where plenty of land but no sufficient water. Under tremendous works collectively called as “JALAYAGNAM” he is making AP a greener state and large population of AP farmers are very happy these days.

  • Shankar

    Dr.Reddy came into power only because CASTE politics of TDP where only one particular caste people are becoming richer and richer and richest.

    People are unhappy with TDP like regional parties where only one person is the master and others are dummies. If TDP is in power anybody has no guts to raise voice against chandrababu who backstabbed his uncle, NTR who is the hero of the masses. After coming to power after congress rule, Chandrababu made dirty politics and he backstabbed his uncle

  • http://hyderabadkiran.blogspot.com kiran

    YSR is a Best CM