September 30, 2011

Some thoughts on the culture of arbitrariness

Today during lunch, one of advisors asked me "How is it that India still remains to be poor?" I was full of answers, however to keep it short I said "it's complicated." However, one answer which is becoming more and more important is favoritism, nepotism, or as we call it in India "Do you know who my father is?" Well if you have a very powerful father the laws in India can be completely bent to ensure that you and your father still remain the king! P. Sainath calls it the culture of arbitrariness. Arbitrariness which includes waivers being given citing emotions and sentiments of the mass public, waivers that make absolutely no sense at all.

Lets have a look at one such waiver and let me begin by some simple questions. Now, do want the person who breaks the law to be punished or not? What if the person is really influential? Do you want him to pay the penalty for breaking the law? Now if I say that the person who is to pay the penalty is a politician then I guess all the members of "I am Anna Hazare" fan club would proudly say Yes!

Before looking at who the guilty is, lets evaluate the impact of the misdeed. For starters, lets account for the impact of a small loss say Rs 500,000. Say Rs 500,000 should have been collected by the government as taxes or a penalty or a fine. According to the pain staking research done by the intellectuals of the Government of India, Rs 32 is enough for a family for one day for all its daily expenses. On Rs 500,000 this family could have merrily lived for a little over 15,000 days which in years would be close to 40 years. Considering the life expectancy of poor people, this would be enough for one lifetime of one family. So, according to our wonderful Indian Government, one family could have survived for one lifetime if the government would have taken the Rs 500,000 which it should have. Another way of looking at Rs 500,000 is that with this amount the death of 15,000 Indian families (or 60,000 Indians considering a family size of 4) could have been delayed by one more day!

Now lets change the situation a little bit. Say if a really rich person is exempted from paying a tax which he/she should have paid? Wouldn't there have been a hue and cry? Now consider the amount of Rs 1.13 crores in taxes, i.e., Rs 11300000 (yes there are 5 zeros here!). This amount at Rs 32 a day, would have delayed the death of 353,125 Indian families or 1,412,500 million Indians by one more day. Another way to look at it is it would have been sufficient for 21 families for close to 45 years! Now if I say a politician, say for example Sharad Pawar got a tax waiver of this amount of Rs 1.13 crores for one of his agri-business then the whole country would have made a huge hue and cry. There would have been a trial by media and possibly some of his effigies might have been burnt by some patriotic soul.

I completely agree that there should be a huge hue and cry for this. But that is where the culture of arbitrariness kicks in. Wouldn't a politician suffered a trial by media if he seeked a waiver of taxes or penalty. My question is, now just because Sachin Tendulkar is in the guilty box, why isn't there a huge hue and cry? Why is it that Sachin Tendulkar is finding it difficult to pay a fine which he rightly should according to the law? I find it really amusing and disturbing that the very state government which could do nothing for their farmers who committed suicide, the very state government that has turned a blind eye to the hunger related deaths in Thane district (less than 200 km from their offices in Mantralaya), has gone out of the way to seek a waiver of Rs 475,000 for Sachin. Also I find it difficult to think that the central government waiving the Rs 1.13 crore in duty for the Ferrari of Sachin. Now this amount is a drop in the ocean considering that the IPL is exempted from most of the taxes and so is the BCCI. What worries me is the that the RTO officer who was responsible for this waiver of Rs 1.13 crore on Sachins Ferrari went on to create the now defunct Kochi IPL team.

It is this sad culture of arbitrariness which is becoming the root cause of some the worst problems plaguing India. Tax waivers being given to corporations, mining contracts being given to relatives of politicians, houses to be allocated for war heroes being diverted to political families. This issue of Rs 500,000 might seem small but on a larger scale just think about it. Imagine a tribal family living in a village with no electricity. How can you tell that family that the government is sorry that it cannot provide any medical aid to a sick child because it has no funds. How has the infant that is loosing its life while you are reading this article benefited from one of the beautiful batting innings of India's batting maestro -- isn't the infant paying the price of the sick waivers being given by the government!

Sources:
1. http://www.rediff.com/cricket/2003/aug/09sach.htm
2. http://www.rediff.com/cricket/report/maharashtra-govt-asks-bmc-to-waive-penalty-on-tendulkar-house/20110929.htm
3. http://articles.economictimes.indiatimes.com/2010-04-16/news/28419652_1_tax-waiver-shailendra-gaikwad-bike-scam

1 comment:

Mrunal Gawade said...

Correct. Last sunday I attended a meeting by socialist movement of India in Pune lead by prominent activist and I was sad by their helplessness.

Some day I wish, if I ever get a chance to see Tendulkar in Person, I would gift a 5 Rs note as a courtesy of my honor to respect his wishes to keep his taxes out of Govt. Purview.

I did not read your entire blog, however the situation would change slightly when the middle class, would find it extremely difficult to buy petrol for their new cars and there would be no space to flaunt of their status amongst their peers.

Selfish genes would start playing their roles. However, I do not know what would be the size of our lower class then.

I feel like I am living in a big mela of idiots.

-Mrunal