Can the media liberate the economy from politics? The fracas around the railway budget last week emphasises, once again, how mixed up our fundas are on what drives the economy
The Trinamool Congress (TMC) demanded the sacking of the railway minister, a TMC member, for having the temerity to propose a hike in railway fares. This is not about price regulation or the budget. It is about our naive notions of good economics, about politicians exploiting it and media contributing to it.
Economic freedom is the axiom on which the growth of any country rests. Without liberalisation we would be looking pretty sad; not a 7 per cent GDP growth rate nation driving the world economy.
Yet we continue to question our freedom, not appreciate it. Every time there is an attempt to open one more area of the economy -- retail, healthcare, media -- the arguments against seem stronger than the ones for.
This is not just because we are a chaotic democracy where decisions take time. It is because economically, we are woefully illiterate. And all the debate and discussion in media has only fed this ignorance. The resulting harm is difficult to comprehend, unless you are pre-liberalisation.
Throughout the eighties, like millions of Indians, I too believed that 'government money' is what ran the economy, that socialism was good and a 'government job' was the thing to get into. That is what the newspapers and magazines I read made me believe. It took an MBA and a year of working, to understand that 'taxpayer money' ran the economy, built roads and kept governments running. That if an economy did not generate wealth, it could never fulfil the basic aspirations of its people. So you need private, wealth generating enterprises, to create jobs and pay taxes.
Sorry state: The notion that price rises are bad is another sign of our economic illiteracy
fed by badly trained media
Have things changed? Not much. Most newspapers' still use the word 'sops and subsidies' in a good sense. When export organisations ask for government support or when telecom companies drop rates to economically unviable levels, nobody questions the reasons and the impact. The real price of free calls is poor service and a scam-tainted industry. We take great pride in the fact that airline prices haven't really increased in so many years. If prices are not going up then costs have to be cut somewhere. Have you ever worried about what an airline is sacrificing at the altar of low prices?
This is not just about the ability to raise prices. It is also about the freedom to pay better salaries, to invest and do all the things that help the process of wealth generation and therefore nation building. It is about the freedom, for example, set up a car plant in West Bengal instead of having to shift it to Gujarat overnight because of some random opposition to it. It is about having the freedom to run a business within the laws of the land. This freedom is under a constant threat born of ignorance. And this ignorance feeds both, the public and politicians. It is an ignorance that is then used by crooked businessmen.
Most media allows corporate India to set the economic agenda. There is some analysis of this, but rarely a basic questioning of it. One manifestation of this lack of understanding of basic economics is the complete absence of investigative reportage in business. Can you remember the last time a newspaper or magazine broke a corporate scandal? The Radia tapes story is an example of pathetic reportage, post-facto. The tapes were dropped in the offices of most newspapers and magazines. Nobody went looking for them.
For very long it has been clear that journalists need a crash course in understanding their own industry -- the newspaper, TV channel or website -- they work for. Similarly, a short course in basic economics will go a long way in ensuring that any debate on a business/economic issue does not degenerate in vote bank politics and trivial issues.