El Concepto de Marginalidad. En Latinoamérica la marginalidad nace con

A republic where everything comes free, or dirt cheap, for the rich

—pow

—power, er, wwateater, gas, cr, gas, college eollege education.ducation.

8 October 2005

8 October 2005

If you were one among a quarter of a billion Indians living below the poverty line, or one among nearly half of rural Indians who have never had a light bulb in their homes, what would you have thought of the recent pictures of the tony rich of south Delhi holding candlelight marches against a 10 per cent increase in power tariffs? In that entire protest, the one people missing were Delhi’s poor.

But the well-to-do, even celebrities, were out in strength, painting the media radar screens as if the farmers of Kalahandi had besieged the capital. All this over a 10 per cent increase after so many years.

Having tasted success, the socialists of south Delhi are now asking for more. Several resident elfare associations (RWAs) are threatening to stop paying their water bills unless the Delhi government junks water reform. For the most privileged and prosperous section of Delhi’s elite to refuse to pay their water bills is sheer anarchy and can be put down in 24 hours; just one night spent under a rickety fan in the police lock-up would do. But will the government do it? It perhaps won’t, because of the fear that reform is still seen as ‘anti-poor’. So the rich might win again, and mind you,

it is not just the World Bank-aided water scheme that they are protesting against. Their anger is also caused by another perfectly reasonable idea—of charging a tax on private bore-wells that most of us have dug in our houses in all of south Delhi, drawing unlimited underground water for free, unmindful of drying aquifers. We do it because Jal Board water is so scarce. It is scarce because we pay so little for it and because our water distribution has been awaiting reform for decades. But why should

e care? We’ve got our free bore-wells for which we use electricity now subsidised to the tune of Rs 182 crore a year by our government. And for drinking water, we get our 20-litre bottles of Bisleri home-delivered.

The rich exploiting subsidies in the name of the poor is not really new. That they would hit the streets in protest if these were to be taken away from them, or would refuse to pay their power and

ater bills, is new. This greed has grown over decades of pampering of the rich and the middle

classes, where the state (or the political system) doles out subsidies in the name of the poor but which benefit only the well-to-do.

On Delhi’s power and water, somebody should check the homes of those protesting: how many of them have their own private (and untaxed) gensets running on diesel (subsidised for the poor farmer); how many of them own bore-wells. And you will know how the most privileged members of our society have successfully fattened themselves by hanging on to the mammaries of the socialist state,

The next example is LPG. If, after almost two decades, the expression ‘scarcity’ has hit our front pages, it is because of the price and market distortion that has gone on in the name of the poor, but to

the benefit of the rich. The government wants to subsidise LPG for the aam aadmi, but would hope to sell it at a much higher price to the dhaba around the street corner. The obvious result is a black market, and now the oil ministry threatens to unleash armies of inspectors to prevent ‘diversion’. Market distortion, black market, inspector raj and corruption, these are all the most logical links in the same ridiculous chain of misdirected subsidies. Ask leaders of the Left, who go apoplectic at the very suggestion of an LPG price hike, whether the poor they speak for can afford a gas connection to begin with? To have LPG, you need a home, a kitchen you can lock, a gas stove, a deposit for the

connection. Do the real poor have any of these? And will a small increase really hit the middle, or even lower-middle, classes so badly? An LPG cylinder today costs less than the price of hiring a pirated DVD, or buying Coke and popcorn at a multiplex. And yet the same people will start stoning buses over a twenty-rupee increase in LPG prices.

Look at it another way. Most lower-middle-class families today have a cable TV connection, and it costs nearly twice as much as an LPG cylinder. Do they ask for a subsidy on it? Do they protest

hen cable operators announce annual increases, or pass on the service tax burden to them? They are illing to pay for their entertainment. But they have been brought up to believe that their essential needs—energy, water, education and so on—must be provided by the state free, or at a subsidy.

Talking of education, what happens to your household budget the year your child passes out of school and goes into college? Your expenses go down immediately. That is because private schools charge remunerative fees. Our college fees have not been raised for fifty years. Colleges have to live on UGC subsidies at the cost of the taxpayer. This is actually the finest illustration of Indian socialism, where the rich and the middle classes (or bourgeoisie, if you so prefer these days) get the state to allocate subsidies in the name of the poor and then give them all to themselves. The poor obviously do not have the money to send their children to good (private) schools, or to pay for private tuition. So their children, unless exceptional, do not get the 90 per cent needed to get into a half- decent college. So the school-level subsidy becomes their curse, and the college-level subsidy is out of their reach. What is the better answer? To put private schools also under a UGC-type monstrosity? Or to let colleges charge realistic fees, and use the surpluses to increase their seats as also to subsidise the genuinely poor and the deserving, rather than your child or mine?

The other current pseudo-socialist obsession, Provident Fund interest rates, is part of the same phenomenon. Eighty-five per cent of EPFO members have deposits below Rs 20,000. So how much benefit can they derive from a nearly 1.5 per cent annual subsidy on interest? At the most, Rs 300 per

year, or Rs 25 a month. But the better-paid salaried class has been gifted a privilege their counterparts in the most prosperous economies around the world would envy: an 8.5–9.5 per cent interest, completely tax-free, and with sovereign guarantees. While 85 per cent or more of the genuine

orking classes only applaud a subsidy paid in their name, the real benefit goes to PLUs once again. They are the ones who should be sending thank-you cards to Gurudas Dasgupta.