Panchayati Raj will lead to devolution of corruption. At the other end, reforms too have kicked off a festival of kick-backs.
Today, civil society has overwhelmed the public sector state in fast-track corruption. Consider two examples. The Tehelka documents and the media reports on cricket have destroyed its myth as an honorary, honourable game and recognised its transformation into the big three of horse racing, matka and cricket. We showed Sharjah why bet on camels when cricketers are available and more predictable.
Indians converted disasters into a new high-growth industry helping to contribute to the ngo-isation of the economy. The cyclones of Orissa and the earthquake in Gujarat showed ngos that disasters could be as lucrative as defence contracts and more legitimate. Not that defence lags behind. The much-maligned tout or middleman shows he thrived and thrives well in our military sector where canteen contracts, patriotism or guns have their price and their lobbyists.
The criminalisation of our economy is the real structural reform. Dawood Ibrahim and Yusuf Patel have shown that real estate is where the action is with systematic side investments in India’s greatest industry, Bollywood. Dawood would have given the Ambanis a run for their power if he had not left town. While the hafta still operates as the basic unit of the economy, terrorism has reached new heights in raising revenue through taxation. In fact, the terrorist insurgency in the northeast has virtually abandoned insurgency to become a parallel of the Indian tax service. Its collections are more systematic and impressive than those of the former. Terrorism combines that intimacy of local knowledge of people’s salaries and an ability to diversify into drugs, arms and other salubrious trades.
As the social security net becomes remote and the costs of health, education, energy, housing go up, corruption will increase in the core sectors. Already today, transmission losses in energy are around 40 per cent. Ban corruption in energy and you won’t need the Narmada dam. But contractors may not agree. Medical debt will go up as medicine becomes much more useless and extensive. Biopiracy will increase. There is so much to steal and so many farmers and tribals to steal from. There are probably more conmen in education than in business. Stockmarket scams where no one really gets caught, customs officers and their happy networks, executives with high salaries are also part of this new globalised world. Yet there are countertrends.
The new legislation in panchayati raj has created a new tier of government which will at least decentralise corruption and make it more amenable to control by local movements like the mkss and the Chipko adalats. The rise of the rss and the Swaminarayan sect shows that disasters can be handled ascetically and by accounting for every penny. The Supreme Court rulings on pollution transferring 1,00,000 industries in Delhi showed that bribes may not always help, that corruption might be brought down without a corresponding guarantee of justice. Structural reform will trigger a festival of corruptions. What structural reform did by loosening things was to create an explosion of corruptions in the official economy, the informal economy and the parallel economy. Corruption is no longer an externality in the economy like pollution but a part of the innovative dynamic always seeking Schumpeter-like for new sites of innovation, normally indifferent to whether it is terror, human rights, reform, or inefficiency or life itself. But the icing on the top is still the political. A corrupt Jayalalitha can return electorally to enact a new battle against corruption. She revives the nostalgia of the Sarkaria Report to pin Karunanidhi despite his later contributions to sustainable corruption. As her secret motto goes, Stayam-ev-Jayate.