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Sop Opera: Why freebie culture still works in India

In the late 1970s and for much of the 1980s, M.G. Ramachandran reigned as Tamil Nadu’s most iconic chief minister. At one point in his tenure, what was then Madras was suffering from a severe water shortage. The Telugu-Ganga agreement with Andhra Pradesh was supposed to address this water scarcity. MGR, however, failed to follow through. Instead, he announced a scheme to distribute plastic water containers to families below the poverty line. 
 
That way, not only did he politically make people forget the problem they were facing and going to face in the years to come but also played them with a short-term trick of distributing plastic water containers. Similar materialistic items were distributed under Jayalalitha too - from laptops to gas stoves and now, even washing machines, the list of freebies is endless. 
 
The freebie culture has also spread to several states which include loan waivers, bicycles, reimbursement of education loans, free monthly ration and others. While some of them really seem useful, we still need to question whether this kind of populism actually helps a state do better on human indicators or development of state/country. 
 
On one hand, this kind of mindless promise of freebies in states like Andhra Pradesh, Telangana, Delhi, Tamil Nadu, Madhya Pradesh, Rajasthan and others literally puts a state in economic jeopardy. Let me give you an example: The state debt of Tamil Nadu was around Rs.1 lakh-crore on March 31, 2011. It has now jumped around 5 times to Rs. 4,85,502 crore as on March 31, 2021.
 
So, not only is it financially bankrupting states but we also see how this freebie culture is creating a culture of dependency on the government, thereby making people lazy and also keeping them unemployed, in a way.
 
Let us take the example of free washing machines promised in Tamil Nadu. First, if you are giving a washing machine to every BPL family, you need to choose whether it is manual or automatic. If it is automatic, then you need one constant water line dedicated to that. You also need to decide whether it is front load or top load. Next is the requirement for liquid detergent for such a washing machine. 
 
Apart from all this, you’ll also need electricity supply to make this work. Now, for a below poverty line family, while the washing machine definitely seems like glittering gold, they will have to bear the additional costs of extra water, extra electricity and detergent too. So, their overall cost of owning a washing machine goes up and eventually is a financial burden for them.
 
Same is the situation with the current Andhra government. Showing people with cash is the current government’s motto. Going by that, these mouth-watering sops yield savings of a few thousand rupees per month per household. But, what they don’t understand is that the rising inflation — fuel prices, electricity and water charges from the state government along with purchase of other non-essential commodities is actually hiking up their monthly costs. And for all such family units who manage to keep consumption of electricity and water within prescribed limits, this is a huge financial burden. 
 
But, voters do not see this trick of political parties and fall for it, eventually jeopardising their own future. Now, is this an accepted thing? This whole freebie culture, you ask? 
 
This reckless spending of the taxpayer’s money on freebies is neither a recognised policy/custom nor it is sanctioned in a court of law. It is blatant financial irregularity that amounts to bribing voters using public money solely for gaining advantage in electoral politics. 
 
An important aspect of ‘freebies’ relates to a phenomenon where some communities receive better access to these facilities than others. The communities that are better recipients of these freebies are those whose local leaders have good connections with their representatives and local administration. 
 
Here’s a question we need to think about: An individual candidate distributing cash or giving liquor bottles (using his own pocket money) to garner votes is treated as corrupt practice. But, a party bribing voters in the name of schemes using public money through freebies gets legitimacy and is hailed as a pro-people party? Aren’t these double standards? Because, in both cases, it is a matter of quid pro quo between the voter and political party?
 
Many governments come up with arguments that they announce these freebies for the welfare of the poor. But, it is not a valid point to justify this kind of indiscriminate spending without a limit. State governments also need to focus on increasing the state’s revenue, which will increase the state’s deficit and bring even a revenue surplus state into a deficit. What better example can one find in the current circumstances than that of Andhra Pradesh.  
 
The state’s debt burden stood at Rs 97,000 crore at the time of bifurcation in June 2014 and has climbed nearly 5 times to 3,73,140 crore in just six years. According to CAG's latest accounts — from April to November 2020 alone — Rs 73,811.85 crore was borrowed from different sources by the current government as against the annual target of Rs 48,295.59 crore for the whole year.  Since there is no productive expenditure in the state, there is very little focus on creating permanent revenue-generating assets. 
 
This clearly shows how the burden will directly fall on the taxpayers. While political leaders proudly claim to be generous in catering to the needs of every section of the society, taxpayers need to understand that it is their money that is being misused for these attractive freebies they give away. 
 
Here, I would like to give the example of Venezuela. More than 90% of export earnings of the country come from oil and natural gas. These export earnings had enabled the government headed by Hugo Chavez from 1999 to 2013 to pay for social programs intended to combat poverty and inequality. From subsidies for poor to health services, the government’s spending obligations were high. Then globally, oil prices dropped. That meant demand for oil from other countries dropped, eventually dropping the country’s currency value…putting the country into an economic crisis. 
 
What they then did was printed more currency to keep the country’s economy afloat. But, what happened as a result was the currency’s value fell. With lower oil output, lower income and low currency value, printing more money simply made the problem worse. As prices rose, the government printed more money to pay its bills. This cycle caused what is known as hyperinflation which caused Venezuelans to convert their savings and deal in the black market while also forcing them to flee the country. 
 
With this trend only growing further, we don’t need elections to be manipulated. It looks like even voters are liking these gifts if Andhra Pradesh is taken as a case study going by the recent municipal election results. 
 
Additionally, distribution and disbursement of freebies take away a lot of time and energy of the administrative machinery. Freebies are visible and make an instant impact on the electorate.
 
While we are aware that this kind of freebie culture is unsustainable and can heavily damage the economy, where will the taxpayer end up in this chain of voters? Even without the benefit of good infrastructure or good citizen services, will the taxpayer end up paying more taxes just to support political parties’ blatant and reckless promises? 
 
In these circumstances, will empowering our citizens and also our leaders to spend their energies, working for genuine development to provide employment and dignity to people, matter really? Think about it…!!! 

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