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How Socialist Policies Encourage Corruption

Author: M R Masani, Swarajya Staff
Publication: Swarajyamag.com
Date: May 1, 2016
URL:   http://swarajyamag.com/politics/how-socialist-policies-encourage-corruption


With the Panama papers leak, revelations of AgustaWestland Scam, and Karti Chidambaram’s Benami empire, corruption and black money are back in the news.

Here is what M R Masani had to say on tackling corruption back in 1990. The piece had been taken from ‘Masani at 90’, a series of Masani’s essays that were compiled in his honour in 1995 when he turned 90. It was first published here.

It is very difficult for the rich man not to offer an incentive to the poor man and even more difficult for the poor man to refuse to accept the bribe offered. There is a whole class of politicians and officials in Delhi who pocket the profits of a corrupt socialist system.

Corruption in social life has many causes. A certain amount of corruption is, unfortunately, part of human nature and has existed through the ages. A human being is a mixture of good and bad instincts. As a poet has said :

“There is so much good in the worst of us

And So much bad in the best of us

That it ill-behoves any of us to look down

upon the rest of us”.

The level of corruption in a country at any given stage varies, however, from case to case. Many factors influence the existence or the absence of corruption.

Force of Example

The force of example, of course, is very important. If one’s father is honest and honourable, if the head of a country’s government is honest and honourable, it is likely that this will influence others, particularly the younger people.

An instance of the force of example came to my notice as far back as 1949, when a very senior and respected member of the Indian Civil Service, who was one of the Secretaries of the Government of India, said to me (I was then a Member of Parliament):

 “Mr. Masani, you Members of Parliament expect us officials to be honest, but how can we be honest and honourable when the Prime Minister of India (who was then Pandit Jawaharlal Nehru) sets such a bad example?”

He then proceeded to give me details of an incident which certainly did not show up Pandit Nehru in a good light. Later on, of course, the example set by the Prime Ministers of India further deteriorated with the rare example of Mr. Lal Bahadur Shastri.

By the time Rajiv Gandhi was defeated in the elections last year, he was generally well known for lying repeatedly to Parliament and his financial integrity was certainly not above suspicion. His failure to resign or to sue his detractors for libel was not an example to commend. It is, therefore, possible to argue that it is difficult to expect the ordinary citizen of India to obey the law and eschew corruption when such a bad example is set by the people at the top.

Home education too is very weak in this country. Parents do not always set a good example of courtesy, consideration and good manners. Most Indian parents shout at each other at home. Is it any wonder then that their children shout at any provocation? Any attempt to teach the golden rule “Do unto others as you would that they should do unto you” is of course out of the question because the golden rule is not even known to most people in this country, much less practised. What is badly needed therefore is training in moral principles and good citizenship.

Social Corruption

Leaving aside venal forms of corruption like bribing the policemen on traffic duty or the railway booking clerk, the position is further aggravated by government’s economic policies. If these policies make for hard work, enterprise, the taking of risk and fair dealings, a society is likely to be relatively free from corruption. If government policies are such that they encourage too much security, laziness, sloth and unpunctuality and do not encourage or reward enterprise, that society is likely to be more corrupt. Countries of Eastern Europe, which have groaned silently under socialist corruption for the last 45 years have, with a sigh of relief, elected conservative and anti-socialist governments in recent elections.

The Yugoslav communist leader Milovan Djilas had written about the selfishness and corruption of the communist bosses in Moscow many years ago in his excellent little book The New Class.

We in this country have now learnt to say “corruption is a way of life in India”. Unfortunately, this is true but we are by no means the worst in the world. When Andropov became the boss in the Kremlin, Prof. Edward Crankshaw, a British expert on Soviet affairs observed that the Soviet Union had the biggest black market in the world. A friend of mine who exports garments to the Soviet Union said, before Gorbachev came to power: “Minoo, you talk about corruption in India, but this is peanuts. You come with me to Moscow and I shall show you the real thing. At every single step an official has to be bribed before you can move a step forward” To this my comment was “I am sure you are right because the Soviet Union is even more socialist than India”

How exactly do socialist policies encourage corruption? First of all, there is the silly talk of equality. People are born equals. So, although there should be equality of opportunity before the law, there can be no absolute economic equality without disastrous consequences. To reward a stupid man equally with an intelligent man, or a lazy man with a hardworking man is unfair and unjust. When it is practised, there is every incentive for the intelligent or hard working man to become lazy and stupid because he is not rewarded for showing the right qualities. In India, there is too much security for government servants, they do not do any honest day’s work. Some of them say, “Our salaries are for attending office; for doing anything more we need further incentive”, by which they mean a bribe! Among the worst of these are the clerks of nationalised banks who report for work as late as 11.00 am and often refuse to work for another half hour because Their Majesties are having tea or coffee on working time.

Some Other Causes

Similarly, excessive taxation makes for tax evasion. Even the honest citizen is driven to consider whether he should pay the full tax. Prof. Northcote Parkinson, the well-known writer, has said in his book “The Law and Profits” that where a government imposes an income tax of more than 25% of a man’s income, the average man is likely to spend more time on evading taxation than on producing more. In India the level of taxation has of course gone well beyond 25% and that is why many rich people in India never pay any tax at all, while the middle class with fixed incomes is grossly overtaxed.

A direct cause of corruption is of course controls of all kinds. Under the present so-called socialist system, people in business have to approach government for a permit or licence or some sanction or other to start a company, raise capital and so on. Now it is well known that government servants are not too well paid. On the other hand, business people enjoy a higher standard of life. So a rich man has to go to a poor man to get his rubber stamp. The farmer goes to a mamlatdar for a sanction and the Bombay or Calcutta industrialist has to fly upto Delhi for a government’s official sanction. In both cases, the situation is readymade for corruption. It is very difficult for the rich man not to offer an incentive to the poor man and even more difficult for a poor man to refuse to accept the bribe offered. That is why corruption has become endemic in India. There is a whole class of politicians and officials in Delhi who pocket the profits of the corrupt socialist system. This is the New Class described by Djilas in his book. Is it any surprise that the politicians and officials in Delhi should resist any change-over to the system of competitive free enterprise on which the countries of Eastern Europe have already embarked? No mere change of government will suffice. What India needs is a Social Revolution.

The causes of corruption are not hard to ascertain. It is a pity that absence of moral education and training at home and in school alongside of government policies since 1955 have been definitely contributing to corruption in our society.

Getting Rid of Corruption

We need not, however, despair. Other countries also have a similar record of corruption. Britain is a country which is today relatively free from corruption. But only two centuries back, in the days when Walpole was Prime Minister, things were different. Many seats in the British Parliament, which were described as “pocket boroughs” could actually be bought. A poem of that time had a jingle:

“Every man and woman has a price,

Nobody’s virtue is over vice”.

If we want to undo the situation, we shall not only have to improve the level of moral education at home and in schools in our country, but scrap all laws of the Stalinist pattern of socialism which our first Prime Minister was ill-advised enough to impose on this country. No tinkering will suffice.

Rajaji summed this up very well when he wrote:

“Unless we minimise official intervention and ministerial power, making or marring the fortunes of businessmen and industrialists, unless we reduce controls up to the level called for by international trade and exchange pressures and bravely decide to knock out the rest and try out the consequences, we are bound to suffer this newly introduced and widespread malady of corruption at the ministerial and secretariat levels”

This piece has been selected for publication by IndianLiberals.in, an initiative of Centre for Civil Society. It is an online library of all Indian liberal writings, lectures and other materials in English and Indian regional languages, with an aim to preserve an often unknown but very rich Indian liberal tradition.
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