Oil prices: Govt fools, fleeces people

The Narendra Modi government is using every trick to justify the costlier petrol and diesel. From the rising crude prices in the recent past to state governments imposing higher sales tax (as if most of them were not being under the Bharatiya Janata Party) to the need for infrastructure development to hurricanes in the US—everything is responsible except the Central government. From the glib Finance Minister Arun Jaitley and the bumbling Petroleum & Natural Gas Minister Dharmendra Pradhan to the brash Minister Alphons Kannanthanam—everybody is trying to defend the indefensible.

Kannanthanam is the latest to taunt those who had reposed their faith in his government. The tax money is used to implement welfare schemes for the poor, he said. “To make houses and toilets and to get electricity to every village… it is going to cost enormous amount of money. So we are going to tax people who can afford to pay.”

In this fairy tale, government is the Robin Hood that taxes (robs?) the rich (man in the street?) to help the poor. The rich, the tale says, are those who have personal vehicles. “Who buys petrol?… Somebody with car, somebody with a bike. Certainly, they are not starving… somebody who can afford to pay has to pay.”

According to the 21^st century avatars of the legendary British character, anybody who is not starving is rich. Even if they live in slums and slum-like unauthorized colonies—as millions do; and many of them also own two- and even four-wheelers. All of them are rich people and, therefore, should be taxed. QED.

But, Mr. Minister, doesn’t the government also spend money to capitalize public sector banks (PSBs) which often lend to politically connected businessmen, and when they fail to repay their loans are ‘restructured’ and ‘evergreened’? Doesn’t the taxpayer bear the burden of the unholy politician-industrialist alliance? Doesn’t he also suffer because white elephants like Air India are run by the government? Why should he continue to suffer just because unscrupulous politicians and their cronies in the corporate sector want to have an unending joyride? Just because the unionized workforce in the public sector wants to have a nice time?

If Kannanthanam is insolent, Pradhan is downright deceptive. The Petroleum Minister tweeted that that there has been price rise “in last three months,” thus jacking up fuel prices in the domestic market. While crude has become costlier in the last three months, in the last three years its price has halved; and this includes the spurt in the last three months.

Minister after minister, leader after BJP leader keeps shouting from rooftops that the government is making huge investments in infrastructure, smart cities (whatever that means), the health and education sectors, welfare of the poor, etc. Well, we know how good the infrastructure in Mumbai and Delhi is. Rains drown the commercial capital; and a few showers choke the national Capital, which now dreads the recurrence of smoke from burning fields in northern India. Trains get derailed. Children die in government hospitals because oxygen suppliers are not paid in time. And yet ministers and BJP top brass have the cheek to say that their hearts bleed for the poor.

Not just that, they also have the temerity to pass off high fuel taxes as reforms. Haven’t we linked petrol and diesel prices to market, they say. This is as bad as it gets, for these guys are labeling bad policies as liberalization and giving it a bad name. Fleecing consumers in the name of infrastructure development or fiscal prudence is not reform; making structural changes is; but the government is not doing this.

In this context and milieu, structural changes would mean privatizing public sector undertakings (PSUs) and PSBs, and insisting on debtor discipline. Revenue should be raised by selling state-run entities rather than tormenting common people; and it should be shielded from the electoral calculations of politicians. Thus, there should be no loan waivers, either to industrialists or farmers.

The Modi government has turned its back on the real structural changes, and is trying to fool and fleece the common man.

 

Photo courtesy: www.wikipedia.org