What’s the first question in the field of public policy? According to the Indian Economist Ajay Shah, “What should the state do?” is the first question. He says, “A great deal of good policy reform can be obtained by putting an end to certain government activities and by initiating new areas of work that better fit into the tasks of government.”
This question is especially essential for a weak state like India. But what if people prefer government subsidies, assertive intermediaries and a weak state? I don’t know the answer to this question. The story of the Indian farm protest is an illustrative example; it is a rebellion to stay bound to the old status quo, fearful of free choice.
04 June 2020: Union Cabinet clears three ordinances meant for reforms in the Indian Agricultural sector. These reforms upgrade farmers from being just producers to free-market traders. Agriculture is a state subject in India, but state governments have had no political will to usher in these reforms. China reformed its agriculture sector first, followed by other industries. India is doing it the other way round and thirty years late. So, the union government followed constitutional means to usher in the reforms.
04-05 June 2020: Leader of Bharatiya Kisan Union (BKU), Rakesh Tikait, welcomes the ordinances.
09 August 2020: Two months after the cabinet’s ordinance, voices of dissent emerge in Punjab, Haryana, and U.P. because a minority of well-off farmers in these states are associated with APMC—the post-green revolution status-quo— that makes them comfortable middlemen.
14-20 September 2020: All the three bills cleared in the two houses of the parliament. But a party member from Punjab pulls out as a symbolic protest.
25 September 2020: Protest gets a ‘Bharat Bandh’ (India Shutdown) tag even though farmer unions in only three states oppose the reforms. The Union Govt opens a communication channel and holds several talks with these farmer associations over their concerns.
04 December 2020: The Union Govt offers a work-around the dilution of MSP. By the way, MSP sets an unnaturally high price and cuts out the competition, so the middlemen club in the farmer’s association of Punjab, Haryana, and U.P. want nothing less than the scraping of these reforms.
21 December 2020: Farmer associations boycott Jio and Reliance products unrelated to the farmer bills.
08 January 2021: Greta Thunberg’s online toolkit for a planned Twitter campaign against the Indian government is launched to invoke human rights violations; it confirms a hashtag.
10 January 2021: Online narrative set and future social media posts finalized.
12 January 2021: The supreme court of India makes a committee to examine the laws.
21 January 2021: The Union Govt offers to stay the laws for 18 months for a consultation, but it gets rejected.
26 January 2020: The farmers, during their Tractor Rally protests, breach the Red Fort, leads to a scuffle with the police. They hoist a religious flag at the Red Fort, thereby giving this arcane legal issue an unwanted sectarian color.
Bottom line: A) The Ordinances aim to liberalize Agri trade and increase the number of buyers for farmers. B) de-regulation alone may not be sufficient to attract more buyers.
Almost every economist worth his salt acknowledges the merit in point A) and welcomes these essential reforms that are thirty years late but better late than never. Ajay Shah says, “We [Indians] suffer from the cycle of boom and bust in Indian agriculture because the state has disrupted all these four forces of stabilization—warehousing, futures trading, domestic trade and international trade. The state makes things worse by having tools like MSP and applying these tools in the wrong way. Better intuition into the working of the price system would go a long way in shifting the stance of policy.”
However, the middlemen argue on point B), that acts as a broad cover for their real fears of squandering their upper-hand in the current APMC/MSP system. Although nobody denies that a sudden opening of the field for competition will threaten the income of these middlemen, such uncertainties should not justify violent protests, slandering campaigns, that look to derail the entire process of upgrading the lives of a great majority of poor farmers in the country.
Even worse, these events get branded in broad strokes as state violence and human rights abuses by pre-planned Twitter and street campaigns and unnecessary road blockades. Everybody questions internet outages during these protests but no one questions the ethics of protesters blocking essential roads in the city. A section of the Indian society and diaspora hates Prime Minister Modi for sure. I have no qualms with this, but the reckless hate shouldn’t negate all nuances in analyzing perfectly sane reforms. Social justice warriors legitimize the vicious cycle of dissent without nuance because they don’t take the trouble of even reading the farm bill but make it a virtue to reason from their “bleeding hearts.”
Talking about social justice warriors, the sane voice of Sadanand Dhume, a Resident Fellow at the American Enterprise Institute, one of the few left-leaning voices from India I respect writes, “What do Rihanna, Greta Thunberg, and Vice President Kamala Harris’s niece, Meena Harris, have in common? They’re all rallying support for India’s farmer protests, which are morphing from an arcane domestic dispute into an emotive international cause. And they’re all mostly wrong in their thinking.”
Ordinarily, the Indian state works inadequately, experiences confusion when faced with a crisis. It comes out with a communication of a policy package that attempts to address the problem in a short-term way and retreats into indifference. So, there are two aspects to its incompetence, one, there is a lack of political will because special interest groups persuade the government towards the wrong objectives. And two, the state capacity is so weak that it fails to achieve the goal. The farm protest is a hideous third kind of difficulty: a special interest group of assertive, influential middlemen want the strong-willed, long-term thinking Indian government policy—a rare entity— to sway towards short-termism under the pretext of human rights abuse. The hard left is actually supporting the Indian state to remain weak. They will also be the first to blame the state when it comes off as weak in the next debacle.
The story never ends.
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