Democratic Trap
Democracy does not serve everyone equally. You need to be endowed to take advantage of democracy. In the absence of riches, democracy just pushed the poor even further down.
Just before India was granted independence from the British, the area which includes modern-day Yemen, UAE, Bahrain, Oman and Qatar was separated from India and designated the Arabian Raj. Jawaharlal Nehru wanted nothing to do with the region because it was poor, impoverished, and would drain resources from the mainland. Each of them was a princely state, but the princes were considered so poor that the British refrained from providing them with any gun salutes.
Every one of those states except for Yemen adopted a monarchy. Yemen was the only state to become a semi-presidential Democratic Republic. Their current economic predicament says a lot about which system served the region better.
On the other side of India, Singapore adopted what can only be described as a democratic dictatorship. Lee Kuan Yew was in office for 31 years.
When countries are poor, democracy is a bane. It forces leaders into short-termism and puts them in a position of constant squabbles where they must pull each other down. What is needed at that time is a benevolent dictator who will drive with a vision and deliver long-term outcomes.
In the book, ‘What Makes Democracies Endure?’ Przeworski et al. offer this fascinating insight – ‘a democracy can be expected to last an average of about 8.5 years in a country with a per capita income under US$1,000 per annum, 16 years in one with income between US$1,000 and US $2,000, 33 years between US$2,000 and US$4,000 and 100 years between US$4,000 and US$6,000 … Above US$6,000, democracies are impregnable … [they are] certain to survive, come hell or high water.’
One only has to look at the history of Asian economies (China, Indonesia, Korea, Malaysia, Singapore, Taiwan and Thailand) to see how this is borne out. And even beyond Asia, Pinochet’s Chile and Fujimori’s Peru are examples of economic success in lands bereft of democracy.
The reason for this ‘anomaly’ is that each of these dictators, whatever their faults (and there were many), was able to ensure some semblance of property rights, functioning institutions, growth-promoting economic policies (for example, in fiscal and monetary management) and an investment climate that buttressed growth – the things that democracy promises to do.
In India, there is a sharp Urban vs Rural divide in the per capita income.
The government of India does not supply statistics on Rural Per Capita Income Vs Urban Per Capita Income, so I am forced to use proxies and anecdotal evidence to determine this.
According to the Chief Economic Advisor, the per capita income of India is Rs 2.12 Lacs. (~ $2400).
As per a survey undertaken by the NSSO, the percentage distribution of agricultural households owning less than two hectares of land is 89.4%. 90% of the households in rural India have less than 5 acres of land. I would be willing to further make an argument that half of them would probably own about 2 acres of farm land.
An acre of paddy yields profits of about Rs 25,000 per season. Assuming one plants for a couple of seasons a year, this number would yield Rs 50,000 in annual income. Say, one were to plant a crop such as peanut or potato, the profits from an acre would be about Rs 50,000 per season. Again, two seasons of cropping would yield Rs. 1,00,000 in income. A farmer might not plant the same crop for both seasons, and let us split the difference and say they earn about Rs 75,000 per acre.
My assumption is that a good 50% of smallholder farmers have about 2 acres of land, which would give them Rs 1,50,000 (~ $1800) per year in income. This is not neatly spread like butter on your toast but comes in lump sums at the time of harvesting, which causes them to go into a debt trap and eventual poverty, but that is for another time.
Now coming to the anecdotes, my maid earns about Rs 30,000 per month working multiple houses. That translates to about Rs 3,60,000 (~ $3800) per year. Let me state, unlike the farmer, this is not household income but individual income. Her household income would at least be twice as much, if not more. Thus, the migration to cities.
But going back to the per capita income story, one can posit that the per capita income of Rural India is less than half of that of Urban India. While I did not plan this, if you take the average of Rs. 1,50,000 and Rs. 3,60,000, we arrive at Rs. 2,55,000, which is not too far from the per capita income touted by the Chief Economic Advisor.
If we go back to the assertion made by Przeworski mentioned above, it is plain to see that the Urban Indian is operating in a different system from rural India.
It is unequivocally true that democracy is not working for rural India, while it is just sort of, kind of working for Urban India. In some ways, Urban India is foisting democracy on Rural India. This has played out in the form of armed rebellions in certain places known as the Naxal movement; in the form of demands for statehood; and in the form of farmers’ protests in the capital.
Unfortunately, the rural Indian has no real recourse. Their protests have not yielded much. Why?
Revolutions rarely start on the street; they often start in the courtyards of palaces when an elite who could not make it to the top decides to tear apart the very system that would not allow him (it is usually a him) to rise.