ANALYSIS Perhaps the best thing we can say about the Prime Minister’s 90-minute news conference today (read the formal text here) is that it happened at all. For a PM who is often criticised for keeping mum when the treasury is being looted or when momentous things are happening around him, holding forth for that long must be a new high.
However, many of the answers he gave to questions from newspersons are revealing. But more often than not, they raise serious doubts about his commitment to probity in public life beyond his own personal incorruptibility. They also show that he is a master at evading constructive responsibility for the economic havoc his governance caused.
When asked about corruption, Manmohan Singh said those things happened in UPA-1 (2004-09), and since his government got a stronger mandate in 2009, these cases (2G, Coalgate, CWG) had already been judged by the people. Two points here, really. The reason why corruption did not figure strongly in the 2009 campaign is because these scams broke surface only after the elections. Secondly, even assuming the Congress got a mandate to rule in that election, does this mean corruption gets sanctified?
He admitted that the scams did unearth some “irregularities”, but “the dimensions of the problem were overstated by the media and the CAG” (Comptroller and Auditor General). Again, blaming the media for his failures hardly does him any credit. The CAG was the messenger, and it does not befit as PM to blame the messenger.
Even more revealing is his answer to a question on whether he ever thought of resigning during his nine-and-a-half year tenure so far as PM. He said he “never felt like resigning anytime.” What a revelation! If he “never felt like resigning” in a scam-scarred regime and during an era of acute economic mismanagement (during UPA-2), for which he blamed coalition compulsions or global factors, clearly he is immune not only to criticism, but to attacks of conscience too.
Perhaps an equally bad answer came in response to a question on inflation. While admitting that inflation was a problem, he said this had to be counter-balanced by the fact that the UPA government gave farmers better prices and rural wages were rising faster than inflation. Wages under the NREGA scheme were also indexed to inflation, he pointed out. This is an extraordinary answer to a question on inflation.
In the past he has famously said that food inflation was caused by higher wages and because people were eating better, and now he says that as long as wages are rising faster, inflation is less of a problem. Well, we have news for you, Mr Economist PM. When inflationary expectations get generalised in the economy, wages and prices will indeed chase one another in an endless spiral.
In effect, inflation will never come down in this situation. Manmohan Singh also failed to note a connect between high inflation and a slowing economy. When inflation is out of control, no project will be viable since costs cannot be properly estimated, and cost overruns will make infrastructure projects unviable. Runaway inflation is the primary reason for the investment and consumption slowdown, which has resulted in a decelerating economy.
Inflation is also the direct result of the government’s uncontrolled non-plan expenditures on subsidies – whether it is food, fertiliser or fuel. Inflation has been directly caused by the UPA’s populism and inability to follow sensible economic policies not just for a year or two, but for 10 years now. Fuel prices have been rising all through UPA-1 and UPA-2, but the subsidy bill has not stopped growing.
Total subsidies on oil alone will top Rs 7,50,000 crore during the tenure of UPA-1 and UPA-2 – a colossal mismanagement of the oil economy. Energy prices remain largely unreformed despite two terms in government. If we didn’t see the problem during UPA-1, it was because a booming economy brought in high tax revenues. But in UPA-2 all the sins of omission under UPA-1 came home to roost at the worst possible time for the economy.
But Manmohan Singh slept through it all, and never thought of resigning to make an economic point to Sonia and Rahul Gandhi. Was he afraid they would accept? The only point of negative performance Singh was willing to concede was the failure to create real employment growth. The NDA created over 60 million jobs despite lower growth in six years; the UPA failed to match that number at a time of much higher growth even over eight years. Clearly, this can’t be an endorsement of UPA-nomics.
Nearly at the end of his tenure, Manmohan Singh can perhaps count on one major achievement: the rapid reduction in poverty during UPA’s tenure, driven largely by unrestrained social spending. This is no doubt an achievement, but history will judge whether this reduction was sustainable: whether it was achieved by teaching a man how to fish or merely by giving him free fish. It also has to be balanced by the fact that the economy’s vital signs are now in danger.
An achievement he said he was particularly proud of was the Indo-US nuclear deal. But this is the irony: the deal hasn’t delivered any increase in nuclear power investment in India, nor is it ever likely to given the growing disenchantment the world over about the dangers of nuclear power after the Fukushima accident. Manmohan’s high point has yielded zilch for the country.
And the country’s relationship with the US has hit a new low. Another achievement, though, stands out: Manmohan Singh is the ultimate survivor. But then, all bureaucrats are survivors. They serve many masters, but manage to survive. Manmohan Singh has survived 10 years as PM by saying Ji Huzoor, Yes Ma’am, to the Dynasty. Some would think it was a high price to pay for being a doormat to Dynasty, but Singh obviously does not think so.
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