Thursday, May 31, 2012

Economics of bandh

I had to write this. Otherwise, I would've burst.

Anyone, who's studied the very basic economics, knows that the greater the number of sellers in the market, the better it is for the buyers. And if there's only one seller in the market, buyers will have a torrid time.

Let's say 'governance' is a product/service. How many sellers do you have? Based on our general knowledge and general interest in politics, we would say Congress or BJP, or UPA or NDA. It looks like there are two sellers. Think about it, are there two or more sellers?

Two points here:

1) You can say there are two or more sellers only if you have an option of switching.
2) Assuming that competition among sellers benefits buyers, the latter should be able to switch in real quick time.

Sure, there's an option of switching. When? Every 5 years. And after you swtich, when does the benefit accrue? Ha ha ha ha. Your guess is as great as mine.

Whether a dying patient can switch to a better hospital only depends on how many minutes/days of life he's got. If he's got just half an hour of life left, switching might not help.

The structure of governance, or let's put it 'the market for governance services' is ridiculously stacked against the buyers (voters or common people). Top it with the fact that individual allegiance matters very little. You might prefer an independent candidate, but the majority might prefer a Congress candidate or a BJP candidate. And since the two parties have had a chance to govern and channelize monies, every chance for them to lure the impecunious in their fold through momentary pecuniary benefits. Lo, there goes majority.

Coming specifically to the bandh.

Petrol prices were always be destined to rise. Why? Coz everything that we do to produce more and consume more and grow more requires energy. Only the most radically effective or path-breakingly efficient solution can rescue us from the the spiralling prices.

Did the leaders not know that if we grow like any of the western countries we wouldn't have the space to accommodate cars if every family bought one?

Did the leaders not see that Mumbai is has such a staggering number of people that it possibly can't have any more cars on the streets?

If the western countries' type of growth is what we are aiming at now, did the leaders not see the western countries' modes of transportation? Why couldn't the provisions be made 20 years earlier for a good public transportation system? Not just in Mumbai, across the country, in all the growing towns and cities?

But of course, why would they bother to see anything at all. There's no competition for at least 5 years. After 5 years, there's no emancipation. Another bull-shit governance service provider with monopolistic power walks in. And we keep alternating between the bull-shitters.

Imagine the enormous movement it takes across the country to make the monopolistic government concede on even a single point which the masses think might be beneficial.

True democracy can't stand on monopolistic governance structure. Just coz you get a chance to choose once in 5 years doesn't mean it leads to democracy. Just coz there's an institution of 'elected representatives' cannot mean there can't be monopoly. Till the time we can't switch between two or more governance service providers in real quick time, it's going to be a monopoly. And we are going to face the consequences of a monopolistic governance.

I wrote about this earlier as well. Here.

PS: There's another factor 'economies of scale' which has an impact on the market of governance services. Will elaborate on that on another day. If you want to keep a track of these thoughts, please subscribe to the blog and the posts will be delivered to your inbox.