How Sonia Gandhi robbed Surjeet’s lands and why Gouramma is angry with Shantappa: The Monkey Business of MNREGA

Near the Radha Soamy satsang, Parore, Kangra district, Himachal Pradesh:

Surjeet Sharma, a Gaddi pandit belonging to the scheduled tribes of Himachal Pradesh, clearly remembers the year 2005, when he married a gaddan from Chamba. Year 2005 was momentous for the Sharma’s, not only because of the marriage of their only son but also because that year they had collectively made a decent profit in their fields and had brought their first automobile. Usually in Himachal, land holdings are modest because only a small proportion of the land mass is flat in these terrains and cultivation in the slopes is quite difficult, yet average yield per square meter is a lot higher than other parts of India because of the rich soil and abundant water. In the lower and mid hill ranges like Kangra, Hamirpur, Mandi etc. farming is a tri-annual ritual with three distinct peaks. Customarily, grains are grown during monsoon and summer, while vegetables during deep winters, thus paddy is an ideal monsoon crop followed by either pulses or wheat and potato during winters. Sharma’s own 20 kanaals (about 2.5 acres) of ancestral agricultural property near Parore in Kangra district and the family of three, consisting of the elder Sharmas and their only son Surjeet, would all work in their fields to grow rice wheat and potatoes. Since it was difficult for just the three of them to maintain 20 kanaals of land, Surjeet had employed 2 other people in his fields in a unique rural ESOP (employee stock option) arrangement wherein he would not only pay them dehaari (daily wages) but also share with them 15% of the quarterly profits.

In 2005, Surjeet had harvested a bumper crop and had sold close to 100 quintals of potatoes in the local mandi in three months, earning a net profit of 40 thousand rupees. Having an entrepreneurial zeal, Surjeet brought a Maruti Suzuki Omni van in order to put his driving skills to better use. The idea was to use the van as a transportation tool during winters to get a better price for the potatoes in the Kangra mandi, rather than selling them at a lesser price in the local bazaars. He had also factored in large number of tourists that flock the region to visit Dharamshala and he would augment his income by ferreting these tourists as a part-time taxi driver. A logical business decision indeed, but Madam Sonia had other plans for him.

2012: Welcome to the land of MNREGS

Today Surjeet is a full-time taxi driver and has given up on agriculture as a means to earn livelihood. Instead he cultivates only about 5-6 kannals of land to cater to the annual requirements of the Sharma household, while the rest of the land is lying dry, unutilized… it is as good as non-existent for the Sharmas, who are even contemplating about selling it off. His father is old and sick and almost bedridden, so he can no longer be expected to work in the fields. His former employees have been gobbled up by MNREGS and no new field hands are available, even his wife and mother prefer to work for MNREGS as it pays them handsomely for almost doing nothing (among other things MNREGS employs people to chase away/capture monkeys in the hill state). Between them, Surjeet’s mother and wife bring home about 20 to 30 thousand rupees per annum because they are employed for 20 days a month for almost 7 months a year under MNREGS (if you are in the good books of the sarpanch or local authorities then you can always make more). In the small towns of Himachal even a middle class family can lead a happy life with less than 5 thousand rupees a month, so where is the need for the Sharmas to work hard in the fields? For a taxi driver, Surjeet is smart enough to know that this trajectory is potentially disastrous, he says, “we know that Sonia ji is giving us money for doing nothing, but what will happen to us in the future, only God knows… in the process we have lost our lands though”. Thus Surjeet has been reduced from an agricultural entrepreneur to a taxi driver by Madam Sonia.

Cut to Rampur village, on the Kembhavi-Hunsgi road, Yadgir district, deep northern Karnataka: (in the summer of 2012)

Shantappa Vaalikar belongs to a lower caste but owns 15 acres of irrigated land, he is also the head of a large joint family of two younger brothers and their wives and kids. The entire family works in the fields to produce Sona-Masoori rice two times a year, a variety that fetches a decent price in the market and is consumed heavily across south India. Despite of the fact that their fields run adjacent to the canal system of UKP (upper Krishna project), they have not been spared from the drought that has hit the state this year. Thus they have collectively decided to let go of the crop for the second peak. In fact the entire village is not cultivating Sona-Masoori this peak and all the lands are lying vacant for almost six months.

Although the water supply to these fields surrounding UKP did not completely dry up like say in the neighbouring region of Bombay Karnataka that depends on the Almatti dam and associated canal systems, yet they could not afford to take the risk of cultivating the crop as it is a costly affair these days. For instance, MNREGS has ensured that field labour won’t be available for harvesting – as people have become too lazy to work after getting government doles – thus farmers in this region hire harvesting machines from Tamil Nadu, who charge anywhere between 40 to 60 thousand rupees a day (6 to 8 acres)! So one cannot take the huge risk of cultivating a crop without the adequate insurance of abundant water supply. In fact, if one travels in the rural hinterland of Surpur Taluq of Yadgir district, one is bound to encounter large amounts of white snowy material along the road-sides, it is the cotton from the adjoining fields that has automatically withered away due to lack of adequate labour in the harvest season. As per one local estimate, cotton farmers have lost somewhere between 12 to 18 Crore rupees in the last one year because of improper harvest timing.

Gouramma (Shantappa’s wife) is angry these days as her husband goes missing every evening. Shantappa and his large joint family has a lot of free time on their hands for the last few months, so every evening the entire group of men folk visit the 11th century Shaivite temple of Dasimayya (the poet saint) in the neighbouring village of Mudnoor. There is a large half-constructed hall surrounding the temple where all the men of the twin villages gather in the evening, not for spiritual reasons mind you, but to indulge in gambling and drinking. Most of the men in that gathering are daily-wage labours of the MNREGS kind who get doles by the state for almost doing nothing, consequently having no qualms about gambling away the government money. Left to themselves, this group of men would want to live this way for eternity, without working and always gambling and drinking and indulging in carnal pleasures – maybe that is what Madam Sonia wants too.

Mahatma Gandhi National Rural (socio) Economy Gutterization Scheme:

These are not isolated instances, instead this is the story of India today. Rural socio-economy is being systematically destroyed in the name of Gandhi and socialism, as village after village are falling into the death traps of laziness and corrupt practices. Yes, this is also giving rise to huge amounts of corruption, for instance as a Sarpanch (who shall remain unnamed, for obvious reasons) in Himachal Pradesh explained how the work schematics are inflated in order to employ more number of people for more number of days for lesser amount of work so that everybody in the village is happy. Example: if there are 40 monkeys troubling crops in an area of say 100 hectares, then the number of monkeys is inflated to 400 and about 100 villagers are employed to chase away/capture these imaginary monkeys at the rate of 1 person for every 4 monkeys. This may sound all monkey business to the readers, but it is the absolute living truth that this writer has been witness to (people are employed as guards, as the central govt. is yet to give official clearance for monkey chasing under NREGA). In the process more number of villagers are also happy that they are getting paid for less (in some cases nil) work and the local village authorities are also happy as they can create dummy accounts to route the government money to their own pockets by artificially inflating work orders.

This is the Money Shankar Aiyer wet dream of Panchayati raj! The fundamental flaw of MNREGS is to expect a village pradhan to not only plan job works but also make judicious use of the work force to excute the works! It is creating a new set of Mai-Baap culture wherein the poor villagers are now totally subservient to the local authorities for their doles. The prognosis of such a system points at three major risk factors;

  1. Socio-cultural upheaval leading to chaos in the society. When taken in the ethno-religious context, such a system is potentially dangerous in creating micro-imbalances at the village unit, reminiscent of the Mughal raj which ruled India despite being in minority because they controlled purse strings and also the ability to give out doles.
  2. Impact on the work culture of rural India. Everybody is working a lot less and getting paid for being increasingly lazy with each passing day, for the government has incentivised laziness.
  3. Corrupting the core of India. It is systematic nationalizing and ruralizing of secular-socialist corruption by the left-libbers. A whole generation of honest villagers are being encouraged to be dishonest and are being methodically co-opted into the don’t-work-instead-practise-corrupt-methods-for-livelihood school of thought so that there is lesser outrage by the co-opted citizenry when the next big-ticket scam is unearthed.

This is Sonia Gandhi’s ‘inclusive‘ gift to India.

Raison d’être:

UPA government started the world’s biggest dole scheme as a part of their grandiose economics-with-a-human-face initiative to counter the India Shining liberal economics practised by NDA. Unfortunately, the results of MNREGS are the exact opposite of what UPA/Congress had professed to achieve through their blatant Santa-clausism. Consider the three key parameters of unemployment, inflation & poverty, MNREGS has had an adverse effect on all the three aspects. In fact a new vicious poverty chain has been created in the country, the impact of which will destroy almost an entire generation.

  1. Employment: This giant welfare scheme instead of creating additional primary occupations for the rural poor has instead created far greater than expected absenteeism from regular employment in both organized as well as unorganized sectors. Instead of working additional hours and enhancing incomes and climbing aspirational ladders, the rural recipients seem to have given up their regular occupation and chosen to be satisfied with their current levels of income and consumption. As a result there is artificial inflation of agricultural labour costs. No Mr Prime Minister “the rising demand for labour” is not helping the landless to improve their livelihood, instead it is disrupting the entire eco-system of rural India by forcing farmers to abandon their trade. Normally, such an infusion of funds should have created at least 12 crore jobs in rural India, instead not even 30% of that has been achieved even on paper (in reality it is probably around 15%).
    1. Inflation: Primary food price levels have increased by an astonishing 65% since January 2008! This is unprecedented in India’s inflationary history. The travesty of it all, as pointed out by the Morgan Stanley research paper, is that those who did not have jobs still haven’t got jobs, but have got the money from the state to become net buyers. This has resulted in idle labour sitting at home twiddling thumbs, while raising food and wage inflation astronomically. There will be a further lag-impact on inflation due to farmers abandoning their crops, because of rising labour and input costs, and instead embracing state welfare interventions (as demonstrated in the two case studies above).

Items

2007-08

2008-09

2009-10

2010-11

2011-12

All Commodities

4.7 8.0 3.8 9.6

8.9

Primary (non-food) Items

8.3 11.1 12.7 18.4

9.9

Food items

7.0 9.1 15.3 18.4

8.1

[Inflation data source: Dept. of economic affairs, Ministry of Finance, Govt. of India]

  1. Poverty: Recent World Bank studies conducted in 8 countries has shown that rising inflation has increased poverty by 3 percentage points between 2007 and 2011. While inflation remains in double digits, lower middleclass and lower class families’ income levels (especially in mofussil India) have either remained static or have not increased commensurately in the same period of 4 years, thus pushing them into the vicious poverty chain.

MNREGS has destroyed Indian Agronomy while breeding corruption at the village level:

Workdays

Self Employed

Rural Labour

Others

Total

Percentage of Households involved with MNREGS

Agri

Non-Agri

All Self employed

Agri Labour

Non Agri Labour

Rural Labour

Up to 20

23.1

27.5

24.2

34.9

26.4

32.3

17.8

28.4

20-50

18.4

18.1

18.3

26.1

21.2

24.6

15.5

21.7

50-100

21.1

13.6

19.1

13.1

25.2

16.9

13.2

17.7

100+

0.3

0.3

0.3

0.6

1

0.7

0.1

0.5

Total

62.9

52.6

62.0

74.7

73.8

74.4

46.6

68.3

Average number of days rural households involved in MNREGS

42

34

40

32

44

36

40

38

 

[Data Source: Department of Industrial policy and promotion, Ministry of Commerce and Industry.]

On an average about 63% of rural agrarian families are now utilizing MNREGA, who were earlier self-employed agriculturists. Potentially, 63% of India’s agriculture can become non-productive thanks to unabashed state sponsored welfarism. Couple that with 75% of rural agricultural labour now gobbled up by MNREGS and it is straightaway a doomsday scenario in the making.

Thankfully, for once corruption is a saviour. As per studies done by various government and non-government organizations, on an all India basis, an average 50% of all MNREGS spend is accounted by leakages. In other words roughly 50% of the dole reaches the end user and the rest of it is all pocketed by local authorities and middle men. For instance, during the Mayawati regime in UP about 20000 crore rupees was spent on MNREGA, and roughly only about 8000 crore rupees actually reached the beneficiaries. It is a 12000 crore rupee scam that needs to be investigated. MNREGS has transformed honest hardworking villagers into a corrupt lazy race that would always be dependent on the Congress largesse.

Despite all the corruption and leakages even a 20% hit to the agronomy is potentially disastrous for India. Do not be fooled into complacency by the security of there being time before the disaster hits you, for the rot has already set in. In India net buyers are large in number including urban poor and rural poor. Data from NSS (59th round) indicates that only 25% of the rural households and only about 44% of farming households were net sellers of main crops in 2009-2010. That figure is expected to fall down further by FY 2012-2013 to about 41% of farming households, when coupled with deficit rainfall/drought, this could have a disastrous impact on the crucial balance of net sellers and net buyers.

In addition, although it is true that net sellers are likely to benefit from rising food prices, the constraints on agriculture may prevent farmers from responding in the short run. Some of the small producers with a marketable surplus could, in fact, become worse off with higher prices, because a small producer typically sells the surplus immediately in the postharvest season, when prices are low, and buys food when prices are high.

A case study:

Recently, Vivekanada trust (a small NGO operating out of Himachal Pradesh) sponsored a study to evaluate the implementation of MNREGS in Sirmour district of Himachal Pradesh. There are 6 blocks in this district and for this study 4 blocks namely Rajgarh, Sangrah, Paonta & Shillai were selected. From these blocks 10 panchayats in proportion to their numbers in each block were selected. Further 50 villages from these selected 10 panchayats were picked up. In all 1000 beneficiary families @ 20 random beneficiaries from 50 villages ensuring representation to every panchayat were selected. While selecting the sample; social, cultural, political, economic and geographical variations were given due representation. Two important findings of this survey need to be highlighted;

MNREGS, doles for the rich?

Income

Agriculture

Casual Work Within The District

Outside The Dist.

No Response

Total

Up to 20000

347

190

19

105

    661

20000 to 50000

170

96

04

20

290

50000 to 100000

25

06

05

06

42

Above 100000

04

00

01

02

07

Total

546

292

29

133

1000

Only 24% of the families interviewed accepted to being below the poverty line where as 76% of the respondents live above poverty line. Further, close to 35% of the families have a reasonably good income (usually, in such surveys families falsify their income levels to show themselves poorer) and they should be encouraged to further improve their skill sets rather than making them dependent on state welfare.

Another important finding was that although an overwhelming 83% of the families claimed to have been actually deployed to work within the statutory limit of 15 days and only 17% accepted to getting doles without work, social audit of the muster rolls showed that only 174 current entries tallied with the job cards. In reality, probably only about 20% of the people actually do some hard work while the remaining simply get paid by the panchayat. Another aspect to be noted is that most of the Pradhans are themselves contractors and most MNREGS workers are employed by these “contractors” for their own works.

Thus an entire eco-system has been built around this scheme that is not only destroying agronomy but also systematically draining the money that should have been used for developing the long term rural infrastructure of India. The highest impact of this has been on small and marginal farmers who are the biggest contributors to high value agricultural produce in India.

Agricultural production by small and marginal farmers in India:

Land holding

Vegetables

Fruits

Cereals

Milk

44%

70%

55%

52%

69%

Data Source: Birthal, Joshi & Narayanan (2011)

Indian economy is in shambles:

The so called “silver bullet” of MNREGS is not just destroying the micro-architecture of rural Indian socio-economic systems but is also impacting adversely the larger macroeconomic model of India which had only recently found its moorings. About 30 billion dollars have been spent on MNREGS alone, producing rural infrastructure that is not worth even 10% of that expenditure (in the form of some half-baked, ill-conceived irrigation projects and rural roads). UPA has simply destroyed Indian economy in a decade of mis-governance;

  • Consolidated national fiscal deficit is in the range of 9-10% for more than 4 years now, being the largest among key emerging markets
  • India is growing at the slowest rate in more than a decade – 5 or 6% growth is a hogwash as most of it is achieved by boost to consumption through public spending rather than actual increase in productive capacity.
  • There is a huge decline in private investment in the country
  • Indian Agricultural growth is on the verge of going into negative territory for the first time – unless drastic measures are initiated, 2012-13 could be the year when the country’s agronomy unravels
  • Armed forces in India are in their worst state of preparedness because of lack of minor and major acquisitions
  • 300 million Indians will be added to the job market by 2018, Morgan Stanley projections predict that India at best can hope to give gainful employment to only a third of that figure (about 100 million jobs).


Epilogue: What happens when one creates a world record? Simple, one tries to break it by going higher than previously, and create a new world record. That is exactly what Congress/UPA and the Gandhis are planning for India. If one considered that MNREGA was the world’s biggest socialist dole scheme to date and nothing more foolish can be done now, then lo and behold for its big brother, FSA is coming to a panchayat near you to give hapless Indians more inclusive growth. What is more, unlike MNREGA, the Food Security Act would not be limited to rural India alone, but will encompass the whole of India – urban, rural, rich, poor – it won’t make any discrimination at all. Rahul Gandhi would be the face of this food security thingy (Hugo Chavez must be running for cover) and India shall drown in his largesse to give him absolute majority in the next round of national elections. How much would it cost? 1200000000000 rupees per annum (as much was spent on MNREGS in the last 6 years) in terms of money, but the actual socio-economic cost to India would be unimaginable, for it could potentially take us back to the dark ages. How does it matter anyways? What is important is that Rahul Gandhi should become the Prime-Minister of India for the sake of India’s Secularism, for the sake of people living below the poverty line, for the sake of maintaining India’s liberal ethos … blah.. blah.. blah.

(Image Courtesy- Hindu Business Line)

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Praveen Patil

Praveen Patil

Analyst of Indian electoral politics and associated economics with a right-of-centre perspective.