LK Advani’s speech to the FICCI

If you want to build a ship, don’t drum up people together to collect wood and don’t assign them tasks and work, but rather teach them to long for the endless immensity of the sea,” advised Antoine de Saint-Exupery.

Does makes sense, doesn’t it? Motivating the task is the real job of the leader, not messing around with petty details.

Somehow, Indian leadership has consistently failed in that primary job. Setting the goal and articulating the motivation for why the goal is worth achieving is what leaders should do, and leave all the details to those experts who have professional expertise in the various areas.

Let’s say that the leader wants the educational system to be improved. He or she then should just explain why it needs to be done and get the best minds in the country (or wherever) to figure out how it should be done. The leader should not go into details because it is not possible that he or she is the expert in that domain.

Being unable to acknowledge that one does not have expertize in everything is basically hubris born of a failure of imagination. I see this failure fairly widespread among Indian leaders. Gandhi believed that he had everything figured out: religion, economics, development, history, conflict resolution, etc. Perhaps he could have specialized in conflict resolution and left the economics to those who knew the subject, and left the development to others who had some experience in it. But no! He had to dictate everything.

Same goes for Nehru. Idiot savants are generally phenomenally good at one specific thing and are abysmally below average in most other areas. But if one thinks that one is phenomenally good in every area, then one is merely an idiot without the redeeming savant bit.

A leader figures out which mountain is worth climbing and why, and leaves the actual logistics of the climbing to professional mountaineers, so to speak.

All this is preamble to my critique of Mr LK Advani’s recent address to the Federation of the Indian Chambers of Commerce and Industry (FICCI). At the start he points out that the stock market is down. Fair enough. He correctly characterizes a stock market bubble as “notional prosperity” and laments “greed-driven” financial instruments. “Such undependable devices of the free market economy cannot be the basis for building a truly prosperous nation.” True but I don’t know of anyone who has seriously advanced that thesis that financial shenanigans can be the basis for anything useful.

But more disturbing is Advani’s claim that “unfettered capitalism” is at fault for the distress that the mango man (aam aadmi) is suffering. As far as I can tell, India does not have unfettered capitalism. The financial system is controlled by the government. So are all the organized sectors. Industries have to follow the law of the land which places serious restrictions on what they can produce, how much they can produce, who they must or must not employ, who they can fire and when — the list goes on. India is a socialist economy in theory and in practice.

It is a government of the poor, for the poor, by the poor. The poor outnumber the rich by an order of magnitude. And in a country with universal adult franchise, that means that the governments are elected by the poor. It is definitely government by the poor. Every political party of whatever color (red, green or saffron) is loud in its proclamation that its primary concern is the welfare of the poor. That’s government for the poor.

Surely, after all these years, the cancerous effects of capitalism must have been eradicated from India. But apparently not. There is still some lingering capitalism that needs to be urgently dealt with.

Advani is not happy about “unbridled capitalism”.

We believe that the new as well as the entrenched developmental challenges before India cannot be met by carrying the influence of either free-for-all capitalism or freedom-killing communism. What India needs is a robust, self-confident Swadeshi (nationally-oriented) model of development, which is rooted in the ideals of democracy, equality, justice and integral human progress.

“Swadeshi” is a nice word much beloved of MK Gandhi. It means “self-sufficient.” It is closely related to a word that I love, autarky. I like the sound of the word, not what it represents and its effects. “An autarky is an economy that is self-sufficient and does not take part in international trade, or severely limits trade with the outside world. Likewise the term refers to an ecosystem not affected by influences from the outside, which relies entirely on its own resources. In the economic meaning, it is also referred to as a closed economy.”

Autarky is not a nice thing, nice sounding though the word is to me. Swadeshi too sounds nice but its effects are damaging. Gandhi liked the sound of that word and loved what it did, I presume. So anyway, Advani wants to dress up swadeshi in nicer clothes so that it does not look as bad.

The “Swadeshi re-interpreted creatively” goes this way.

Swadeshi means that national priorities must override policies that have benefited only a minority and largely excluded the majority in the nation’s progress. In other words, just as the centre of gravity of the world economy is shifted from the West to Asia, the centre of gravity of our national economy must shift from “India” to “Bharat” ― to agriculture, revitalization of our villages, small and medium enterprises, and unorganized and informal sector of the economy. . .

Similarly, it sees no conflict between the public sector and private sector. There is no place for dogmatism in favour of or against either, since both have to be strengthened. In view of the recent global experience, the public sector needs to be further strengthened in the financial system and in core sectors like energy.

Swadeshi is not antithetical to cooperation with the international community, just as the concept of Swaraj was not. Nevertheless, its cornerstone is national pride and the belief that the India of our dreams has to be built only by our own genius, with our own efforts, and principally with our own natural and capital resources. India’s problems need Indian solutions.

Swadeshi wholeheartedly embraces the knowledge and products of modern science and technology. It holds, however, that our country should revive its own rich and diverse knowledge traditions and emerge as a major contributor to global scientific and technological progress, instead of remaining mere consumers of outside knowledge.

Swadeshi affirms that business and economy should serve as a means and not an end in themselves, and the higher possibilities of human progress should not be sacrificed at the altar of acquisitiveness, consumerism and environmental destruction.

I will concentrate on the above extended quote in the next post in this series.

In the meanwhile, you may wish to take a peek at my thoughts on Gandhian self-sufficiency.

And for real substance, check out the series on “The Fake PM’s Speech to the CII” from June 2007.

Author: Atanu Dey

Economist.

2 thoughts on “LK Advani’s speech to the FICCI”

  1. Between the congress swearing by nehruvian stalinism and the BJP now talking about “gandhian economics”, india is likely to be well and truly screwed.

    India is still paying heavily for its gandhi fetish of rural-ism, self sufficiency and non-violence.

    That is why we have cities that fall apart, the premier padmini and 26/11.

    If we add “gandhian economics” we’re well and truly screwed.

    Time to do what indians do best — become a refugee!

    Like

  2. Your post mentions a follow up discussing the longer quotation – I have not been able to find this part 2!

    I was looking forward to your views on Advani’s critique of India’s “unfettered capitalism”, and what you feel should be India’s flavour of capitalism.

    Personally, I feel that we should look towards the Rhine Model, as exemplified by Germany (see Michel Albert’s Capitalism Against Capitalism), rather than America’s short-termist capitalism.

    Like

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