Federalism and India #1: Theory and Intent

Federalism. Center-state split of responsibilities and finances. To understand the right split for it, Karthik Muralidharan starts from first principles in Accelerating India’s Development.

 

What are the pros of being a large country? Large countries can have economies of scale – their economic size can be larger, tax from which makes for powerful armies which means they are less threatened by enemies. Large countries can spend more on defense investments, some of which may find civilian applications (think of satellites and the Internet). A large geographic size means a bigger market within one’s borders without the hassle of negotiating inter-country trade agreements. Natural disasters are limited in their scope; and people can move elsewhere. Conversely, the unimpacted parts of the country can supply the money to rebuild the impacted areas.

 

How about the cons of being a large country? Large countries will inevitably host diverse identities, but national policies should be uniform. That can be a source of friction. A second problem is the increasing distance between the citizens and decision makers – physical distance, longer feedback times, and the ever increasing risk of policies working in some areas but not others.

 

Federalism is an attempt to try and have the best of both worlds. The idea is to bring the point of governance closer to the regions – local governments should decide how and what to spend on. Federalism is not a hierarchical power structure; rather, it is a model for the distribution of responsibilities. In India, that distribution of responsibilities is called out in the Union and State lists.

 

That’s the theory, anyway. In practice, some topics cannot be cleanly assigned to one entity only. Take education. Research works better at scale, and falls under the center. The medium of education is a state matter. And lower-level matters, like tracking attendance of teachers are left to local level. Further, disagreements arise on who decides if there is a clash of views – center, state or local? This is a continuously evolving topic and cannot be frozen forever. Plus, of course:

“Tensions can be exacerbated when different parties govern different tiers of government.”

 

A benefit of federalism is the freedom to make policy choices. This allows different units of governance (the drilldown of federalism doesn’t have to stop at state sized units) to try different policies. What works could be copied in others. Conversely, any bad policies would be limited in the areas they affect.

 

That’s the theory, spirit and intent of federalism.

Comments

Post a Comment

Popular posts from this blog

Student of the Year

Image
As a toddler, my daughter loved Alia Bhatt’s songs, esp. the ones from Student of the Year . (That movie did have many good songs and well-choreographed dances). Fast forward to present day, when she is 12 yo. She rarely watches Hindi movies now, but one of the few ones she likes of late, Raja aur Rani ki Prem Kahani has, yes, Alia Bhatt.   If I had any hopes that there was anything to be read in the name of her toddler-time favorite ( Student of the Year ), they have been dashed. Our conversations come exam time are perfectly captured by this photo and its caption: In fact, the pic below captures how she and I look at her answer sheets – me intently, she with an expression of “It’s over, so why are you even looking at it?”   Of late, we pull her leg and tell her that she isn’t showing any signs of academic prowess, she’d better find a rich guy to marry. Some time later, she showed us this meme on the Internet: “Me No Study, Me No Care Me Go Marry Millionaire ...
Read more

Why we Deceive Ourselves

In their book, The Elephant in the Brain , the authors describe this weird aspect of deception that we practice: deceiving ourselves! That is so weird: “If our minds contain maps of our worlds, what good comes from having an inaccurate version of these maps?” The Sigmund Freud school of thought treats self-deception as a defense mechanism, “a way for the ego to protect itself”. The mind seeks to protect itself from anxiety and other negative emotions. Many object to this reasoning: since accurate information is so critical to our survival, surely distorting information would be dangerous. Wouldn’t the goal of protecting our self-esteem have been better achieved by making the brain’s self-esteem mechanism stronger instead? The new school of thought explains self-deception as “primarily outward-facing, manipulative, and ultimately self-serving”. This is based on Thomas Schelling’s work on game theory: “In a variety of scenarios, limiting or sabotaging yourself is the winn...
Read more

Europe #3 - Innsbruck

The last city we visited in Europe was Innsbruck in the Austrian Alps. After the cold and windy experience (at times) of Paris and Netherlands, Innsbruck was a wonderful change – it didn’t feel that cold, it was not windy all of which made it easy to walk around. Something absolutely necessary given how scenic the place is.   Since the hotel check-in time was much later in the day, we left the baggage and went to the Swarovski HQ-cum-museum about an hour by bus from Innsbruck. The crystal exhibits were brilliant – colorful, bright, shiny. Jewellery aside, it was a display of what one can do with crystals. While my wife and daughter loved the jewellery, I liked the superhero themed exhibits of Batman, Spiderman, the Hulk, and Star Wars. We didn’t buy anything there, though we did buy stuff in the Swarovski store in Innsbruck – jewellery, not the superhero stuff.   Innsbruck is a major tourist attraction during the skiing season but now in summer, we saw many groups of ...
Read more