This phase in China's history has been viewed, particularly by the
mainstream Western media, in relatively bleak terms. The dominant perspective has undoubtedly been one of human and civil rights. This perspective is undoubtedly important, but let us sidestep it for a moment. With hindsight, it is possible to interpret the emasculation of the entrenched bureaucratic interests that the cultural revolution sought to destroy as a crucial precondition for the success of economic reforms initiated by Deng. Any programme that signalled such a radical departure from the prevailing ideology would inevitably have faced enormous resistance from the beneficiaries of the incumbent regime; in China, the cultural revolution destroyed the capacity of such interests to resist the changes, however radical they might have been. The lesson, if any, from this sequence of events, is that attempts to change are more likely to be "successful" if they follows efforts to destroy the potential resistors of that change.
The relationship between the socio-political structure and economic performance of countries has been subject to a large amount of research by economists. Mancur Olson (in The Rise and Decline of Nations, 1971) compared the growth performance of several developed countries in the post World War II years, during which Japan and Germany, which had been defeated in that conflict, outperformed UK, the US and other countries which were on the winning side. Olson viewed the socio political structure of a country in terms of what he called "distributional coalitions", which are essentially combinations of vested interests who strive to influence policy to serve their own narrow objectives. He argued that in countries that experienced long periods of political stability, certain coalitions would become dominant, and that policy outcomes would be reflective of their objectives and interests rather than that of the economy as a whole. Against this backdrop, he sought to explain the difference between the two groups of countries in terms of the fact that defeat had fundamentally realigned political forces in Japan and Germany by way of destroying existing dominant coalitions; while winning the war had strengthened the existing balance in the victorious countries. The policy decisions taken in these two countries, therefore, were not subject to the pressure of narrow interest groups and were thus able to serve the broader national interest by way of faster growth. The argument that countries experiencing long periods of relative stability show a decline in economic performance is often referred to as the "socio sclerosis" theory.
Pranab Bardhan (The Political Economy of Development, 1984) used the coalition-based approach to analyse India's economic performance. He perceived a dominant coalition in India consisting of three major groups: large landholding agriculturists, indigenous business interests and professional white-collar workers, including the bureaucracy. He argued that none of these interests groups was powerful enough to individually influence the policy agenda, so the outcome had to be a compromise between the relatively heterogeneous objectives of all three groups. One striking example of this is the high priority that the state has put on higher education relative to primary education, something that is quite at odds with the experience of, say, the rapidly growing economies of East Asia. One possible explanation of this is that this is an outcome that serves the interests of the professionals, by way of providing cheap university and professional education for their offspring, while preserving the supply of low-cost menial labour to businessmen and large farmers.
While one may quibble about the precise nature and impact of dominant coalitions, our experience with economic liberalisation lends a tremendous amount of credence to this analytical approach. The history of resistance to reforms that were intrinsic to the logic underpinning the overall strategy is well known, and too long to attempt to recap here. However, the phenomenon appears to have taken on a whole new intensity in the weeks leading up to the fiftieth birthday bash. In quick succession, the government has faced the embarrassment of withdrawing an empty threat relating to the pay commission recommendations and facing defeat on a crucial legislation facilitating private provision of insurance services. Viewed in terms of the coalition argument, both these reflect the ability of the bureaucracy and public sector employees to hold the country to ransom.
What does this mean as we approach our golden jubilee as an independent nation? Interestingly, we may be just turning fifty, but the coalitions that Bardhan identified effectively date back much longer. The large landholding class obviously predates even the British era, but was perhaps consolidated by the colonial regime as a revenue-generating system. Indigenous business was powerful enough to extract protection from the colonial regime against British products, and leveraged this power into the extremely protectionist post-independence regime. And, the modern bureaucracy, as well as the broader English-literate professional class from which it is drawn, is virtually a creation of the colonial regime.
Thus, our attainment of independence was an event of striking contrasts. On
the one hand, there as the extreme violence and dislocation arising from the process of partition. This was at the grassroots level, experienced directly by the affected individuals. On the other hand, at the macro level of systems and institutions, we frictionlessly adopted those created by the colonial regime for its own purposes and based on its own antecedents. This was perhaps with the rather naive belief that these systems and institutions are merely tools or instruments that will willingly serve the visions and objectives articulated by the leadership of an independent nation. We now know, through several years of both analytical advancements and bitter experience, that no system or institution persists as a willing tool, continually subordinating its own interests to the cause of the nation. Unless, of course, as the Chinese and other experiences suggest, it is periodically subject to radical restructuring.
As we observe our golden jubilee, we have to come to terms with this essential paradox. We are a young country but our basic socio-political structure long predates our birth as a nation. To which we have added several other elements, most of which have only contributed to the existing gridlock. We can only meet our broader objectives as a nation if we put in place systems and institutions consistent with and subservient to those objectives. China did it with its cultural revolution; we need our own version of such political bypass surgery.
