Thoughts on economics and liberty

Will increasing the number of laws help India? Is the Jan Lokpal Bill just one more utopian law?

Vijay Mohan, a member of FTI, has sent in an article he wants to share with you. Being an interesting perspective, I'm publishing it as a guest post. Basically, Vijay questions the pedigree of the Jan Lokpal bill, wondering whether it is merely going to increase red tape. Will increasing the number of laws help India ? 

[Note that as it is late tonight, I'm switching off my computer after this and will provide my comments on this article in the comments section tomorrow.] 

Corruption: A path to growth in restrictive environment

By Vijay Mohan

Raj’s (Shah Rukh Khan) mom told him in DDLJ that, there are always two paths. One will be of truth the difficult one and other will be of falsehood but will be easy. So to take the bride He took the path of truth and honesty and got 100’s of slaps and kicks, but anyway Hero’s can bear unlimited number of shots but took the Bride and the people start clapping at the performance. Overall a super duper hit movie…
Now a hero with totally opposite attitude, Abhishek Bacchan in GURU took the short cuts for success, played with the rules, bribed beaurocrats to get his business running, in the end he could provide the consumers a better quality silk cloth at much lesser rate, the employment it generated was another noble cause.
The same feeling I got after the speech of GURU as I got while Raj took the path of truth. But the outcomes are different; DDLJ is a fictional story while GURU is a story based on life instincts of Dheeru Bhai. In fictional story Raj got Simran, Story ends while for Indian Economic Story begins with THE End of Guru.
The real intentions of making money of GURU will still be a question mark for most of the Indians for whom making profit is dirty task. I think we got this feeling from Nehru? The designer of our governance system. I didn’t see any harm but only good his business did for others. So isn’t the topic (Corruption: A path to growth in restrictive environment) justified
So Guru took a path of corruption and got only good, Had he been relying on the systematic paths, the paths designed by our first prime minister of India (Against the paths suggested by Patel, Rajaji, Ambedkar and Gandhi) he would have been kicked out of the industry (that created prosperity for so many), Infect he was kicked but he tricked and got back into business.
Education is the other issue in current scenario which inspires me a lot and whatever standard education is in India is because of corruption otherwise there would have been private schools miles away with pathetic conditions [Lesser schools, No Competition, No Quality AND More corruption more private schools, Competition fosters quality].
I got educated from central school, I was lucky to be borne with father in central government. The fees (My father) paid was negligible, But I don’t know who else paid other part of my fees through Taxes (Mostly Tax is paid by private enterprises as Govt is only good for nothing, they don’t generate money, they only destroy it).Our PT teacher could slap any student anytime without asking and we had no one to approach to, I would wonder if this can happen in private schools. The quality of education wasn’t up to the mark when I reached standard XI and XII, but we were told not to complain about the teachers as those will be transferred to other schools and your brother will suffer.But our juniors didn’t obey them and compained and got the teachers tranfered (But they got new teachers worst than before), This gives me hopes and new generation will ask for there rights and freedom to choose. … In private schools those teachers would have been sacked for better replacements [But no solution exists, If you suffer from Govt Failure], as Private schools work on repo unlike Govt schools that will get students anyway. With some of my friends shifted to private schools, got the best among the teachers available. This was again possible with corruption as private schools didn’t follow the rule of recruiting teachers with defined qualifications which my Govt school followed , I don’t know How in the World Govt can define teacher ability with his/hers competence of teaching.Private school followed the Market principles . What most of the students in my class did then?? They took private tuitions from the teachers of private schools, first wasting the time in school with those pathetic teachers and then spending money on tuitions.
I only got my computer teacher for last two months before the board exams, as recrtuitment process is so heavy and complex; But Private schools by passes them and chooses market to select but again this is a corruption of private schools.
So the result of Corruption… More schools, better teachers, better quality of education, and employment and PROFIT.. Shhhhhhhhhhhhh (Don’t tell anyone as making Profit in education sector is again a Corruption).I agree that price of education is quite high with good private schools , but come on, school owners have to get fees out of parents to compensate for the bribes .Other reason is Demand and supply theory , restrictions discourages people opening up private schools and demand of schools is quite high, hence the cost shoots up.
I don’t see a demand of lesser rules and laws in India and limited Government in India , Hence I think Corruption is doing some good at least But What is this , What I am hearing Now , Hang the Corrupt people ?? Catch the Corrupt people, More Laws, More Rules… Jan lok Pal, though I know these Laws / Rules will not curb corruption, But I am afraid, What if Govt employees… Start following the Laws and rules in the designed system … Where will these private schools and GURU Be.?? Or Lokpal will nationalize the private schools as Bitiya Indira did….
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Here's an image that Vijay has sent in, to illustrate his article (click for larger size)
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8 thoughts on “Will increasing the number of laws help India? Is the Jan Lokpal Bill just one more utopian law?
  1. Vijay Mohan

    Thanks Sanjeev,
    I need to correct some words/sentences but i think reader would be able to understand the message.
    Vijay Mohan

  2. Sanjeev Sabhlok

    Vijay, now for my views on your article.

    First, I commend you for your broader approach to India's growth and prosperity. You are very right that India's goal should not merely the absence of corruption, but individual liberty and the freedom to get educated, for instance – through private institutions.

    Second, you are right in pointing out that though India's is a very low level equilibrium based on poor policy and corruption, the bright spots are the private sector initiatives that have basically manoeuvred their way within this low level equilibrium.

    Third, you are right in pointing out that just making more laws is pointless. Indeed, in the case of the Lokpal bill, it is (in my view) merely going to drive high level corruption underground, with the common corruption unaffected (the Lokpal can't deal with 10 million complaints each year, with 95% of the bureaucracy being corrupt, in addition to 100% of the politicians).

    However, and this is an important point, I would suggest what we should not even remotely tolerate corruption on ANY ground. This is a serious ethical issue and harms India at many levels, even though some private enterprise has "managed" to thrive despite corruption. We must work towards removing corruption  – noting that it requires an approach that is holistic and integrated, not simplistic and futile (as the Lokpal bill is).

  3. Vijay Mohan

    Thanks Sanjeev,
    My point of view is that , In current policy framework , there is no way that businesses would survive without bribing the way out.
    I wanted to stress and pinpoint the over regulation and excessive laws as the problem NOT the corruption which is a symptom. 
    our priority should not be catching corrupt and implementing baseless laws or creating new laws.
    We have to change the system
    Vijay Mohan

  4. Sanjeev Sabhlok

    Dear Vijay

    I wouldn’t agree that “In current policy framework , there is no way that businesses would survive without bribing the way out”. I know of at least one business which has managed to survive, even thrive, without ever paying any bribe. I think most international IT businesses of India (e.g. Infosys) have managed to survive without paying bribes – or at least that’s my hope.

    There is also work going on in the business sector in India to build an ethical culture (pl. read Sonia’s recent post:

    Ultimately, though, you are right that “We have to change the system”. That’s exactly right. Unfortunately very few people in India understand this basic issue and therefore keep running around like headless chooks (chickens) at every demagogue and ‘saviour’ who rises up with a “solution”.


  5. Vijay Mohan

    Dear Sanjeev,
    Yeah You are right , As our IT industry is very less regulated  , hence it grows like anything , it contributes most to our GDP. Corruption is less and generates the prosperity. Thanks to IMF forced reforms in 1991.

  6. Kamal

    Valid points Vijay. Esp. the point of Nehru and the notion prospered by his policies that profit is a "dirty word"…so much needs to be done to educate the common mass to see through.

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