True application of Keynesian Economics
John Maynard Keynes, an eminent economist of the 20th century, often comes into public discourse whenever the global economy faces any recession. He gave his recipe to address the ill-effects of the Great Depression of 1929-33.Because of the Great Depression there was a significant decline in the aggregate demand for goods and services. This was mainly due to lack of purchasing power with large sections of population which, in turn, was due to the prevalence of all round huge unemployment. The whole world got beleaguered into the vicious circle of low-demand- lay off and huge unemployment-low or no purchasing power and again low demand. His recipe was to enhance public investment and expenditure so as to generate employment and enhance aggregate demand for goods and services. There is an anecdote that on his advice the governments started engaging the workers in digging and filling-up the pits so that they may get money to meet their consumption-demand.
Keynes gave his recipe when the world was neck-deep into the Great Depression in 1930s. But the recipe to ward off the Covid-driven recession was visualised ( by constructing the road from Airport round-about to Banur-Kharar road ) much before the onset of the Covid-19 pandemic.The context and implementation of Keynesian recipe, however, was altogether different than the recipe of these ‘great visionaries’.Nevertheless, all those involved in the construction of this segment of the road really deserve ‘appreciation’ from one and all. Keynes, lying in his cemetery, must be feeling great about such a set of visionary people thousands of miles away from his native country, U.K. as the above said road it displays the true application of his recipe.
This author has been travelling on this road ever since it was open for public use. Lakhs of people (including VIPs and VVIPs) travelling on this road are witness to it that this road has always been under repair from the very beginning. A huge amount of money must have been spent on its continuous repair which is continuing even today. Apparently, there is something fundamentally wrong with the quality of construction. The moot question is that why there was no investigation into that and why the government did not think of dismantling this poorly constructed road and constructing a new one in its place?
It seems that there is reckless misappropriation of public resources which, in turn, is a reflection of wide-spread corruption in the system. This road is the living example of both these systemic problems. Chanakya (375-BCE-283 BCE)wrote about corruption that you never know when a public official does corruption like you don’t know when a fish drinks water. This means the corruption is millennium old systemic problem but in his famous treatise Arthasahastra he has given the complete system of governance and the recipe to curb corruption. There is an anecdote that once he was doing some official work in the light of an official lamp, someone came to him for his personal work. Before listening to him Chanakya lit-up his personal lamp and switched off the official lamp. Though such an extreme judicious use of public resources may not be possible in the present phase of crony-capitalism yet the minimum we can do is to minimise the misappropriation of public resources and the level and degree of corruption at all levels.
Former Punjab CM S. Partap Singh Kairon
Back home in Punjab, people still remember late S. Partap Singh Karion as an institution builder, visionary leader and efficient Chief Minister. Not because there was no corruption in his tenure as CM but the extent and intensity was much lower than what has been there afterwards. People of Punjab also appreciate the performance of late Sd. Lachman Singh for his efficient governance as CM, though for a very short tenure. There is an anecdote about Kairon that whenever there was commissioning of some big projects in the state he used to call the high level meeting of officials just to warn them that the quality of work and construction would never be compromised. So in case there is any scope they may include their ‘commission’ (bare minimum) in the estimate itself, but no pardoning-off thereafter. That is why all those constructions are still in good shape. Even some of the constructions of the British period are still in good shape.
Former Punjab CM late S Lachhman Singh
Despite the qualitative improvement in technology over the period of time, the quality of construction is getting deteriorated. This is something paradoxical and a great predicament of our times. This needs a plausible explanation. The knowledgeable persons often say that one of the most plausible explanations to this paradoxical situation lies in the difference in the degree of corruption and the intensity of embezzlement of public resources, then and now. Both these ingredients used to be like salt in the wheat flour in good old times but down the lane content of salt have been on the rise.
The above mentioned road is a stark example of such a scenario.Unfortunately, it is not the only example. Such a scenario necessitates saving the field from the hedge. In other words, there is an urgent need to minimise the level of corruption and misappropriation of public resources if not 100% eradication so as to ensure judicious use of scarce public resources.
July 23, 2020
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