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The success of AAP and the end of Hand-outs

In the interest of full disclosure, I would like to make some points evidently clear before I offer my not so expert commentary on the importance of the success of the AAP in the recently concluded Delhi election. I am an NRI, center-right leaning agnostic Hindu, who believes that Narendra Modi is the best option that India has in the current political landscape, and am someone who has a pathological distaste for ostensibly left-leaning economics, which I believe has been the bane of the Indian state since its inception, and has largely been the reason for many of the socio-economic malaise.

Thus, I believe that AAP is not just the old Congress socialist handouts in a new bottle, but is spiked with highly potent Methanol that has ended up blinding the Delhi electorate and potentially bankrupting the state. Nevertheless, I can’t help but feel that AAP winning the election has been a major blessing in disguise, with the five-year tenure of Kejriwal possibly signing the death warrant to the culture of handouts that has been a veritable cancer since Nehru’s times. Looking at the situation in front of us, there are only three possible outcomes that can happen from the AAP’s attempt to fulfill their wild promises:

  1. They fail absolutely miserably in delivering even the bare minimum.
  2. The party achieves marginal success and on a qualitative note might even end up fulfilling all their promises but doesn’t end up fulfilling everything to the letter.
  3. The AAP, in a stunning display of performance which would put the director of Nayak to shame, manages to fulfill all their promises qualitatively and quantitatively making Mr. Kejriwal the real alternative to Mr. Modi and the prima-donna in the center-left political space.

Let us examine each scenario individually. Scenario 1 is a no-brainer. The AAP fails miserably, there is chaos and the party is no longer deemed worthy of even a municipal seat by the electorate. This is highly unexpected as there are many tangible promises in the AAP manifesto that they can fulfill without too much difficulty.

Scenario no. 3 is where the AAP is poised to earn substantial political dividends. In this highly unlikely scenario again, the AAP would have fulfilled their promises, but it would have been at the expense of basic fiscal prudence. Indeed, the electorate of Delhi would be thrilled at the freebies on offer, and might even offer Kejriwal a second term, but come 2019, Kejriwal will be genuinely staring down the proverbial debt barrel, with nowhere to run and hide. Additionally, he would have to placate an ever-hungry electorate who for example might be expecting 4G data speeds from their free Wi-Fi.

All these things cost money, and it’s unlikely that Kejriwal who has a habit of rubbing his opponents the wrong way on a consistent basis will be able to cough it up (pun unintended) from the central Government which he is unlikely to control any-time in the next decade even in the most optimistic scenario. Come 2020, the usual noises of ‘tough times’, ‘fiscal prudence’, ‘weak finances’ would be used and the sops would slowly see their demise, infuriating the public to no end and costing him his support.

Scenario no. 2 is the more interesting one, and the one I think that is most likely to happen. Indeed, Kejriwal will manage to provide subsidized water, subsidized electricity and free Wi-Fi, but this will come with a lot of caveats which wouldn’t surprise the middle class but will definitely be a rude shock to the poor and marginalised who are the ones who overwhelmingly voted for him in this election. The AAP manifesto claims to fulfill these promises with innovative solutions but in no way does it present tangible plans, nor the costs involved. As this report suggests, the cost of the 50% electricity subsidy will cost the Delhi exchequer 3400 crores, out of a total budget of 36800 crores.

As stated in the article by the AAP’s chief intellectual Prof. Yogendra Yadav, the party is essentially banking on the CAG audit of the discoms which will throw up irregularities that the Government hopes to tap into. This is not a guaranteed source of income as it is quite possible that the audit does not find any irregularities and/or does not manage to fill the budget deficit. Either way, the subsidy could lapse very quickly bringing a rude shock to the aam aadmi and disillusionment with the party. This argument qualitatively holds true for the water subsidy as well.

The free wi-fi is a huge canard as it will be limited to less than an hour at best, after which one would have to buy an internet pack. There is no ambiguity in the AAP’s promise which shows very clearly that AAP is promising free wi-fi without any statement anywhere that says ‘conditions apply’. This is again poised to create major disillusionment in the minds of the Delhi youth who formed a sizeable chunk of the AAP vote base.

These two cases are a clear example of how the AAP might achieve some success in the short-term but will fail miserably in the long run. Moreover, being a highly urbanised city, it’s unlikely that in the long-term, the aspirational Delhiite would tolerate low-quality handouts without any actual, tangible improvement in their lives via proper job creation and true wealth building; both of which will definitely take a hit in an AAP Govt.

In summary, the AAP has managed to win an election on the strength of schemes and promises which are either impossible to fulfill, or which will end up bankrupting the state. Neither is sustainable in the long run, and it would end up alienating the electorate. For the first time in post-liberalised India, a party has offered handouts to every strata of society, without rhyme or reason. The failure of the AAP will thus see the biggest abandonment of senseless neo-communist ideas in 21st century India, hopefully putting an end to this cancer forever.

– Robert Barker

Ayodhra Ram Mandir special coverage by OpIndia

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