Simultaneously Shifting Right In The US & India

Simultaneously Shifting Right In The US & India

The most serious position to adopt in politics is the Centre. Farid Zakaria made this point on CNN recently. He held up the highly successful presidency of Bill Clinton as an illustration.  This, of course, in the context of the run-up towards the US presidential election in 2016.

But how does Zakaria’s notion fare in relationship to the ‘fastest growing major economy’ in the world, also its most populous democracy; and the oldest democracy, which is also the most powerful and rich country in the world?

The Clinton presidency was indeed economically brilliant. He created over 21 million new jobs, raised the GDP significantly, took a budgetary deficit of 4.7% in 1992 and turned it into 2.6% surplus by 1997.  Clinton was lucky too, with record low oil prices; 1999 prices were a mere $10 a barrel, and ‘gasoline’ sold at 95 cents a gallon.

Clinton appointed and supported Republican Alan Greenspan to manage interest rates with great success as Chairman of the Federal Reserve Bank. Greenspan first came to be Fed Chairman in 1987, under  reformist, anti-big government/high taxation President Ronald Reagan.  And he left after five consecutive terms, during which the American economy boomed for two decades straight. Greenspan served without interruption under presidents Reagan, George H.W.Bush, Clinton, and finally George W Bush; three out of four of them, Republicans - handing over to Ben Bernanke, in January 2006.

Things have not been so good for the US economy since. And in hindsight, many of Greenspan’s monetarist and ‘easy money’ nostrums are being held responsible for the borrow-and-spend speculative excesses.

In India, successive pre-election opinion polls suggest a landslide victory in the Bihar Legislative Assembly elections for the NDA alliance. One just has to wonder why the promise of Vikas counts for more than everything else.

Particularly, given the recent beef controversy and murders, attacks on Dalits, the Sahitya Akademi awardees returning their citations, LK Advani acolyte Sudheendra Kulkarni being inked, the growing intolerance, farmer distress and suicides, all alongside trenchant criticism of the prime minister for neither speaking up against, nor reigning in, the Sangh Parivar/NDA ‘fringe elements’. And this, coming after the monsoon session of parliament was washed out with another set of controversies.

The use of a different yardstick to judge the Modi government has become routine. Though, it does seem strange how controversy after controversy seems to be raked up, almost as if they are being manufactured.

Recently the chief justice of India HL Dattu, observed he found it peculiar that there have been no further Vyapam scam related deaths reported since the CBI took over the probe monitored by the Supreme Court.  

However, if this latest Bihar poll results comes to pass; at a minimum, the  formulas and assumptions on the state’s electorate will have failed. The NDA is apparently set to win over 160 of 243 seats in the Bihar Assembly.

And, if that happens, the ‘Grand Alliance’ will be routed. The rising challenge to the Modi administration over the past months, after the NDA’s defeat in Delhi, will quickly disintegrate. 

Modi’s personal popularity ratings, which are impressive,  and not only in Bihar, according to a Mint/Instavaani poll in August, and yet another Pew poll in September 2015, will soar, and even greater authority will come to his elbow.

But can a win in the Bihar assembly elections be understood as overarching voter approval for the centrist, developmental approach of  Modi? This, in spite of the accusations that his party and government is promoting a majoritarian agenda?

The Opposition accuses the Modi administration of communal polarisation and saffronisation, both of institutions and national narratives; but voters, if the polls are accurate, don’t seem to care.

In America meanwhile, flamboyant businessman cum presidential aspirant Donald Trump, leads the GOP’s list of contenders. This suggests that the silent majority is reacting to the liberal policies of the Obama administration.

Donald Trump’s appeal, his continued lead in opinion polls, might just be suggesting this. The public may be endorsing his can-do brand of Reaganesque politics. Trump wants to make America great again, militarily and economically, and the public is responding favourably.Trump’s politics may well be to the far right of the GOP, but is the American public too, by backing him, wanting to return towards the Centre?

They probably do not want to particularly address the feminist radicalism of gender politics, after electing a man of colour to two terms in office. So they seem sceptical about both former Secretary of State Hillary Clinton, front-runner for the Democrats; and former Hewlett-Packard CEO Carly Fiorina amongst the Republican line-up too.

Centrism may also explain the decision to hold off at the US Federal Reserve Bank. Chairman Janet Yellen decided not to raise interest rates once again recently.

A rate hike, which some see as both warranted and overdue, would signal a change of policy. In anticipation of further hikes in series later, this might lead to a sharply strengthening dollar. But Ms. Yellen, and the business community in America would dearly like to see a 2% inflation rate arrive first!

This would signal that all the thousands of  billions of dollars spent on quantitative easing (QE) since 2008, plus the nearly zero rate of interest, has, in fact, managed to lift economic activity off the floor. Enough, to withstand a series of, say, 0.25% rate hikes going forward.

Concern also, for how an American rate hike may impact the international arena, including many of America’s trading partners, now that America is ostensibly growing again, is the new ground reality.

Not only would America’s recovery be threatened if its buyers couldn’t afford to buy its offerings, but the cascading effect would aggravate  challenges to world trade, already much slowed by economic and financial difficulties in Europe, China, and the oil exporting nations.

Indian politics may also be changing: from Socialism and Nehruvian pluralism towards an assertive  Hindu Rashtra, but one with concern and due regard for the minorities.  It is dawning on the kicking and screaming old guard that the NDA could be in power for a decade or more, judged from present trends, and the ground narrative may be forever altered.

Likewise, Donald Trump could well become the next president of America and stay for eight years too. This, not because he is a hatemongering, loud-mouth, right-wing looney; but because his candidature, salience, and possible eventual victory signals a return to the Centre for American politics.

So then, are both Modi and Trump custodians of Zakaria’s ‘most serious position’ ? Appearances, however much they may be negatively hyped, can sometimes be deceptive.

For: The Pioneer

(1,096 words)

October 12^th, 2015

Gautam Mukherjee