Don't vote for independents and regional parties

I have a fervent plea to all voters - please *DO NOT* vote for independents or regional parties for next 10 years or so. Even if these candidates may be honest, hard-working, result-oriented - please keep them out of power.

I know this logic seems inverted and downright stupid for the uninitiated. But think about it - the only way we can have a strong government is if one of the national parties receives a majority. Only then can the government go forward with development agenda instead of catering to the whims of individuals or factions. I personally don't care if its the BJP or the Congress which gets the majority - come to think of it both of them have tried to do a good job since 1998. BJP did this nation great service by going ahead with the nuclear tests and opening up the economy - in fact it laid the ground-work for the boom we saw post 2004. Congress also tried to make positive reforms in various sectors like insurance, telecom, nuclear deal, etc. but the fear of the Left kept the Congress from doing a stellar job.


Right now the national parties spend half their time hob-knobbing with their so-called allies and only the remainder of the time is given to the people. And I don't blame them. We as a people have failed if we vote on the following basis:

• caste - needless to say majority of votes are given/taken on the basis of caste and the percentage of people voting on the basis of caste must start reducing
  
• regional pride - Vote for the national government on the basis of regionalism is downright stupid. A good independent legislator is *useless*. He cannot push through reforms alone. Democratic governments run on collective ideology, not personal whims. So while it may *seem* like a good idea to vote for a independent candidate with a clean profile, it doesn't help you eventually.
• Short term promises - The only promises that should be respected are those that have the potential of empowerment - education, skill training, long term infrastructure projects through government spending, making bureaucracy accountable, transparent governance. Promises like reservations, subsidies, freebies only weaken the populace as I have indicated in my previous post - though I must admit it will look attractive to the minimum wage earner.
  

So my request to you is very simple - look who among BJP or Congress candidate in your region is more better and vote for him.

Ok, now for the skeptics: you will very rightly say that this cannot go on forever. You are right - we should do this only for this and the next election. And hopefully until then the national parties would have given a good account of themselves. Hopefully by then parties like Shiv Sena, MNS, Left, AIADMK, Trinamool, BSP, BJD, etc. would be relegated to the side-lines and we will have successive strong governments at the centre taking India where it should be.

Of the poor, by the poor, for the poor

I came across these comments made by Rahul Gandhi and they made me very angry. Lets consider what all our government already does for the poor:

- subsidized food grains, kerosene
- subsidized petrol, diesel costing approximately 1.3 lakh crore rupees last year
- subsidized work culture since government employees need not be afraid of being fired for not meeting work standards
- farm subsidies including no taxation on agricultural income, free electricity, government regulated fertilizer prices, free power and guess what - free money in the form of loan waivers
- subsidized/free healthcare at government hospitals
- subsidies in form of ailing and loss making government companies

At first glance our government comes across as very noble and seemingly the state of the poor people should be alleviated with all this. Then why have these long drawn policies not led to substantial reduction in our poverty rate? Infact when Nehru was absolutely pro-poor(to the extent of being anti-rich) our growth rate was at its lowest. What are the reasons for this anti-thesis? While many posts can be written on the reasons, I will start with the most basic ones:

• any robust economy is driven my a minority of the population. This means that in a country of 1+ billion people you cannot expect 70% of the people to be rich/middle class. Whenever the crest of growth of a country is reached, the consumption flattens and leads to deflation - many European countries and Japan is a good example of this. Currently only 3% of the Indian population pays their taxes. Government should try to increase their tax net to 10-20% over next 5 years. And it is this 10-20% which will be driver of the economy creating enough consumption demand to help alleviate poverty of the rest.
  

Lesson: stop throwing more good money behind bad money. Instead start new projects which pays for services _in lieu_ for something atleast.

• Huge GDP deficits: Insane government spending mostly in form of subsidies causes large GDP deficits. This means that country has spent more money than it has. Every government _raises_ such money by issuing bonds which are bought by banks, other governments, etc. The more your GDP deficit, the more interest you need to pay because your credit rating gets lowered due to heavy borrowing. This increases governments cost of expenditure and slows down growth in the long term.

• "false demand": I would stick my neck out and say that if we had lower subsidies we would be much less affected by the current economic crisis. Reason? Any economic cycle consists of cyclical booms and busts. Important thing is to throttle growth when it is driven by credit money. While the international fuel prices were going through the roof, demand in India wad at its peak because prices here were unaffected. Then suddenly the government realized that country's economy will crumble if we keep subsidizing oil and hence the prices were increased suddenly. This jolts the economy. If prices are decided by market fluctuations then demand also gets throttled at the right time. This way while growth may be slower, it lasts longer and we certainly would not need to see 50% stock market drop in 6 months.

• Giving freebies _for a lifetime_ sets a bad habit among the population. What is being implicitly said here is that if you are ready to accept a poor life we will feed you and keep you alive. We want to empower people, provide them with skills or education and until such time that they are learning you can shower them with freebies but please not forever.