Bibeky Debroy makes a great argument here on the even of 25 years of 1991 agenda.
He says most of Indian classics suggest that government should do minimal things. So just read them and that is what we should do in future as well:
We continue to debate reforms—big bang, steady state, first generation, second generation. Often, we have our preconceived notions about what “reforms” are. To me, whichever aspect of reforms we debate, the discourse is essentially about three strands. First, the government cannot do everything. Second, the government doesn’t know everything. Third, the government means a decentralised government.
On the last, I sometimes think of the Mahabharata. I won’t have the space to build the entire argument. Let me give you the gist. Don’t think only of the Kurukshetra War but also its antecedents. There were a large number of powerful kingdoms in what was India then—Kekaya, Gandhara, Avanti, Bahlika, Magadha, Chedi, Poundra, Pragjyotisha, Anga, Kamboja, Shurasena and so on. India was like a federation of kingdoms; it wasn’t governed with strong centralised control. By the time the Kurukshetra War was over, all these were destroyed. Notice that some kings were killed before the actual Kurukshetra War—Shishupala, Jarasandha, Shalva.
At the end of the Kurukshetra War, we had the powerful centralised kingdom of the Kurus, with Panchala and Matsya integrated into the Kuru structure. A federation was replaced by a unitary governance structure. Why did so many kings fight on the side of the Kauravas and so few on the side of the Pandavas? It is possible that the entire battle was over this idea of India, federation versus unitary structure. It didn’t have much to do with personal stuff like gambling and who should inherit the kingdom. You get the general drift. India became centralised under British colonial rule. Post-1947, economic policies added to this excessive centralisation. The 2010 Report of the Commission on Centre-State Relations gives a very good account of this.
I don’t think the government that came into existence in May 2014 has got sufficient credit for its decentralisation and devolution initiative, fostering federalism, both cooperative and competitive.
Actually, the three points (government knowing everything, doing everything and not being centralised) are linked….
They would do well do read our sacred texts on what was expected from a king (government today). I have mentioned the Mahabharata, but the Arthashastra has similar statements. Security, law and order, and dispute resolution—that’s it. It was by no means axiomatic that infrastructure (roads, wells, gardens) would be constructed by the State. Instead, these were built by richer citizens. Skills were delivered by shrenis, what we would call guilds today. Most of the work of today’s Competition Commission of India was delivered by guilds.
In passing, it is good to recall that Mahatma Gandhi had a healthy scepticism about the role of the State. Indeed, most of what he wrote and spoke about, including swadeshi, was about the individual, not about the State. That’s probably because he was extremely familiar with the sacred texts, unlike some who actually devised post-Independence policy.
We used to have an Economics teacher in college who would incessantly say, “Read the Classics.” He meant that we should read Alfred Marshall, John Hicks and John Maynard Keynes in the original, rather than popular textbooks. In a similar way, I think more people should read about governance in the sacred texts. You will get a different take on the Hindu model of governance. There is a greatly reduced dependence on the government and an enhanced role for the individual and the community. Isn’t that what reforms are about?
Most of us are made to believe and taught that just like kings did everything so should the government. This is what is written in our texts as well.
It seems much of this thinking needs to be questioned as classics said almost the opposite things. Perhaps it has been a case of Chinese whispers here as well as it is with much of economics as well. People said something else which over the years means has changed to something completely different. Adam Smith is one such classic example whose moral philosophy has been discarded completely.
The next question is how should one start reading classics? They are just too voluminous and difficult to figure after a certain age. One has to be really motivated to pick them up later in lives. Unless these things are taught gradually at a young age, we can hardly expect any progress and it will just get worse with Chinese whispers.
Let me talk about an area which I know little better than others. I hardly know of any economic school in India teaching/recommending Arthashastra. It is just rubbished as a text which does not meet western rigorous standards. And unless these are taught in class, they are really difficult as a self-reading. If it is made mandatory then there will be huge hue and cry over altering syllabus etc. If kept optional, it is unlikely to be taught as it does not fit the rigorous economic thinking club.
So what is the way out? Keep finding ways to be self-taught on these classics…