Thoughts on economics and liberty

Land ‘reforms’ or state-sanctioned theft?

'The land ceiling is "a child of sadism"' – Rajaji

Gandhi said all when he made it clear that socialism should not achieve its ends by impure means. ‘Impure means will result in an impure end. Hence the prince and the peasant will not be equalled by cutting off the prince’s head nor can the process of cutting off equalise the employer and the employed. One cannot reach truth by untruthfulness […] Harbour impurity of mind or body and you have untruth or violence in you.’[i] But such niceties were completely lost on Nehru. His First Five-Year Plan articulated his socialist arguments to justify plundering those who held land bigger than a specified size, with the so-called ‘excess’ land being redistributed to the poor. This plan was implemented quickly, and by 1960 most states had introduced ceilings on land.
Despite its reformist title, land ‘reform’ legislation was anything but a reform. It was a completely regressive step.It created massive injustice in a so-called free society. Land reform was all about reparations for what the ancestors of our current zamindars had allegedly done. Land was therefore ‘legally’ taken away from people without recourse to a trial; from people who had not themselves committed any crime. This ‘reform’ was robbery on a grand scale. The state became the Big Thief. If the state legislates a theft it does not make it any less blameworthy. Plunder and crime are not valid merely because these are legislated by a mob of gangsters sitting in the parliament. That is exactly what mobocracies are all about – elected mobs. In a free society, on the other hand, majorities never misuse their parliamentary power to violate individual freedom.
But let us ask ourselves a question – what had India not achieved through its independence movement that it needed to attack innocent members of its society and divest them of their property without trial? Had we not already divested the princes of their monarchical powers and constructed a republic out of a primitive society? Had we not declared adult franchise and empowered the entire Indian community? Could we not have, through equal opportunity and the rule of law, made zamindars completely irrelevant?
In the extremely favourable environment for the advancement of freedom that existed just after independence under the tutelage of people like Gandhi, Sardar Patel and Rajaji, India had a golden opportunity to aspire for the world’s highest standards of governance. We had the opportunity to build a new culture of freedom and justice. That would have led us without fail to Nehru’s promised tryst with destiny; indeed, it would have led us to a tryst with greatness. But Nehru allowed the baser elements found in our country, those who belligerently bellow for plunder out of the sheer jealousy they experience upon seeing anyone with some wealth, to override the basic reason for our independence, namely, to achieve freedom and give us justice.
But a leader’s job is not to follow the mobs. His job is to lead. Nehru let us down very badly by attracting all kinds of thugs into politics. And the less said about his successors the better. Nehru was the best leader we have had in independent India’s government. It has been an even more downhill journey ever since.
So you ask what Nehru should have done, instead. He should have ensured that the yardstick of accountability was applied equally to each citizen, irrespective of the citizen’s social, cultural or economic background. By equally enforcing the rule of law, the evil of feudalism would have been wiped out in a decade without impinging on anyone’s freedom. The following are a couple of measures that could have been taken:
A strong police and judicial system would have ensured that if a zamindar had personally stolen someone’s lands, he would have been punished and the stolen lands returned. If some zamindar committed a murder or rape, that zamindar would have been immediately tried and given capital punishment – or at least jailed for life.[ii] Unfortunately, Nehru’s shoddy system of law and order allowed brutal, bully zamindars and anyone else with money to run amuck as never before.
Public finance is hard work, and setting up an effective and honest machinery to collect taxes from all people of a country is very challenging. But socialists have not bothered to build such a machinery that can reliably obtain an income tax return from all citizens of India. A strong land records system coupled with progressive taxes and a wealth tax could have transparently deployed the wealth in India to the public causes to strengthen infrastructure and provide equality of opportunity. But instead of taxing them, zamindars were rewarded by Nehruvian socialist governments with complete tax-exemption; and land revenue was discarded as a source of revenue. Today most people therefore evade taxes and make merry while the government spends time driving our buses and airplanes.
The greatest problem with Nehru’s approaches is that they fostered a great muddle in the minds of ordinary people about what is right and what is wrong. On the one hand Nehru encouraged his Ministers and bureaucrats to seize people’s so-called ‘excess’ lands. On the other he wanted corruption to stop. But if you confuse everyone about what is right and what is wrong, then why will corruption stop? And so Ministers and bureaucrats extorted money out of traders and manufacturers on the plea that they were taking away ‘excess’ money from these ‘capitalists’. When ethics are negated even in one case by our leaders, there is no stopping the decay of morals in a society. Corruption received a significant boost in Nehru’s time and has never looked back since. In brief, Nehru’s times – which continue till today – are best compared with those of France after its revolution of 1789. Frenzied mobs controlled the government in France after that violent revolution. Today, India is a mobocracy where the entire Parliament is united against freedom. India’s policy has been made for 60 years by socialist mobs driven by revenge, not by lovers of freedom and honesty.
In the midst of this wild loot and frenzy, every rich person, every trader, every money lender and every zamindar has been condemned sight unseen as an evil ‘capitalist’. But each individual must always be seen as the unique locus of individual responsibility. We may be rich or poor, often both in the same lifetime, but we must be individually accountable. Justice consciouslydenied by the state to even one of its citizens diminishes all of us. That, unfortunately, has happened for so long now, and in so many ways, that most of us have lost our sense of justice and ability to distinguish right from wrong. We condone corruption as a practical requirement of life; we vote for corrupt leaders; we give bribes; we take bribes. We have completely lost our way. India has lost its moral moorings. By breaking free of Nehru’s amoral regime, and by removing the immoral haze that blocks the sun from reaching India’s soul, we will once again be able to set our gaze on the lodestar of freedom. That star will then return us to our lost ethics and, more importantly, will return each of us to ourselves. We will find our lost self-respect once again, allowing us to completely renew our life; to be re-born as a different and better people.
As would be expected, under such moral anarchy, India’s land reform experience went to seed. Except for a few places like Kerala, where these reforms ‘worked’ (actually led to enormous fragmentation of land and loss of agricultural productivity), for the most part the so-called land ‘reform’ legislation could not be enforced. Not having strengthened the government’s machinery to enforce the rule of law, this socialist task of stealing land, too, failed, as any other task taken up by India’s governments. Since Nehru’s socialist functionaries[iii] were paid very poorly,[iv] given that there wasn’t much money left to pay them after ‘feeding’ loss-making public sector undertakings, they became easy prey to the manipulations, in self-defence, of the same feudal lords whose lands they were supposed to forcibly acquire. Landlords transferred their lands in the names of their dogs and cats with the connivance of local land revenue officials and police. To unearth the truth behind these ‘benaami’ deals would have required a machinery with honesty of purpose which the thoroughly corrupt socialist government could never possibly muster. Hence, virtually no land finally got ‘stolen’ by the Impotent ‘Big’ Thief.
Indeed, as a result of Nehru’s wasteful efforts, the feudal system remains as strong as ever before.Someone has rightly said that India is now a mix of ‘hypercapitalism’ and feudalism, with neither of these two being founded on any semblance of ethics. We won’t find it easy to build a free society in India today; for that would need a foundation of ethics which will now need many years to rebuild. Corruption has increased to such levels today that freedom will have to fight to get a foothold. The wrong ends (nationalized theft) and the wrong means (shoddy governance) have led to very wrong results. Just as integrity and morality are the hallmark of a society founded on freedom, so also subterfuge, hypocrisy, corruption and deceit are the hallmark of a collectivist socialist society founded on revenge.
Indira Gandhi, who had none of Nehru’s intellectual prowess, continued his mindless ‘justice of yesterday’ tirade. In 1971, during the process of brushing aside compensation for acquired land, she asked, ‘Compensation for what? Compensation for land […] for a palace or big house? […] what about compensation for injustice?’[v] The deadly seed of revenge that Nehru and various other Indian leaders have sown in India has by now morphed into our DNA. Incessant arguments on new ways to redistribute poverty, on how to drag back the wealthy and extract their wealth, swirl around in our disease-stricken heads. We are unable to think clearly any longer of the simple and morally clean arguments of freedom; of ethical ways of generating wealth for ourselves and for our society.

[This is an extract from my book, Breaking Free of Nehru.]

[i] In a written conversation with some socialists on a day of silence in 1947 when he communicated through writing on slips of paper; cited in Fisher, Louis, op. cit., p.306.

[ii] I have nothing against capital punishment being awarded in deserving cases. Mercy is never a virtue when innocent lives have been taken away brutally; it amounts to cowardice. Accountability is not driven by mercy – which is purely a matter for God to decide – but by individual justice.

[iii] Technically speaking, Nehru did not directly run the state administrations, which were under the State Governments. It was mostly Congress Governments that he was able to influence directly. But even non-Congress State Governments could easily be influenced in many ways by the powerful Centre.

[iv] The pitiable condition of police stations, judicial courts, revenue offices and that of ‘lower’ staff who are responsible for crucial functions has meant that corruption has perhaps become the sole lingua franca of the police and the revenue systems. Anyone with a bit of money can almost readily buy freedom, even after murder.

[v] Cited in Austin, Granville, op. cit., p.245.

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