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The Rickshaw Pullers of Ranchi -- Saving Socialism from the Socialists

Jan 7, 2019

Vivek Kaul

In December 2018, I spent five days in Ranchi, the city I was born and brought up in.

During my growing up years Ranchi was basically a one road-town. The main road of Ranchi was rather unimaginatively called what else but the Main Road. Though officially it was known as the Mahatma Gandhi Road. But even today, if you ask anyone in Ranchi where the Mahatma Gandhi Road is, you are likely to get a blank look. (Try asking someone in Mumbai, how to get to Ahilyabai Holkar Chowk).

I stayed in a Hotel on the Main Road, right opposite what used to be Ranchi's most famous shopping complex.

And given that I spent many years loitering on the Main Road, while studying at the St Xavier's College, it was but natural for me to walk around and see how and if things had changed.

One of the first things that hit me was the lack of cycle rickshaws on the road. Cycle rickshaws used to be the most ubiquitous form of public transport in Ranchi, when I was growing up. The city does not have any bus system. Neither does it have any metro or a local railway system.

In fact, when I had visited the city in December 2017, I could see cycle rickshaws almost everywhere. Something seems to have changed between December 2017 and December 2018.

Cycle Rickshaws Are Disappearing


The cycle rickshaws had been replaced by the e-rickshaws. This is a good thing. E-rickshaws are cheaper, faster and can accommodate more people. Also, most importantly they are more humane than a cycle rickshaw can ever be.

The practice of one human being, cycling other human beings, which is still prevalent in parts of North and Eastern India, is something that needs to go. These are points which really cannot be argued against.

Nevertheless, there is a flip side to all of this. In the five days I was in Ranchi, I got talking to the men who drove the cycle rickshaws as well as the e-rickshaws.

The rickshaw pullers are rickshaw pullers simply because they can't do anything else. And the e-rickshaws had hit them hard. There was no way they could compete on price and efficiency. Hence, not surprisingly, they were going out of business. (Again, nothing surprising here. This is how a free market works. If the free market did not work, we would still be walking to get from one place to another, or probably being pulled by horses, if we were rich enough).

The trouble is the rickshaw pullers neither have the capital nor the skillset to do anything else. Also, most of the rickshaw pullers who are still around, are well over 50, and given that, the society giving them the chance of starting afresh, is simply not there. From what I gathered most of the rickshaw pullers who went out of business ended up as daily wage labourers. This did not help because there were too many daily wage labourers in the first place.

The e-rickshaw drivers on the other hand were educated. The drivers I spoke to told me that most of them had studied at least up to the Intermediate level (or what is also referred to as 10+2 or junior college, in different parts of India). Given this, some of them were even graduates. Also, they came from families, which either had the money to buy an e-rickshaw or were in a position to arrange for that money. Basically, they had the capital to get into the e-rickshaw business, which the rickshaw pullers did not.

Capitalism when it strikes does leave behind a fair share of people. Everyone cannot catch up. The rickshaw pullers of Ranchi are one such example. In an ideal world, the socialism of the government (the central, the state or the local government for that matter), should be directed towards these have-nots. The government should help in re-skilling them. Any doles should be directed towards them and so on.

But what do we have in India? We have socialism for the reasonably well off. Take the case of Air India, the government airline, which keeps getting bailed out all the time. Recent newsreports suggest that the airline is set to get another equity infusion of Rs 2,345 crore from the government, which is essential to keep it going.

Or take the case of India's public sector banks, which have sucked out thousands of crore of hard earned money of the taxpayers. The government recently announced that it will infuse Rs 41,000 crore of fresh capital into these banks, during this financial year. This is over and above the Rs 65,000 crore which the government had originally planned to invest in these banks, during this financial year.

Of course, as the owner of these banks, the government cannot let the banks go bust and destabilise the financial system. Having said that, nowhere in the world does any government own 21 banks. That is a reality that needs to be taken into account as well.

Then there is the case of India's public sector enterprises. A bulk of them simply block up capital without providing an adequate return. Most of these firms are barely productive and are still being run so that a few lakh employees can go about their lives peacefully, while lakhs of crore of capital remains needlessly locked. This money can easily be used for other things, including practicing socialism for those who really need it. The farm loan waivers being announced in one state after another, benefit the well-off farmers than the poor ones. So does the policy of minimum support price, cheap fertiliser, free electricity for the farmers and so on.

I can go on and on about this, but this is a column and not a book, and hence, I will stop here. (If you are looking for more details, you can read my book India's Big Government).

Indian politicians, whatever they might say initially and privately, at the end of the day are die-hard socialists in public. The problem is that the socialism that they practice is rarely for those who need it.

To conclude, nearly, one and a half decades back, Raghuram Rajan and Luigi Zingales wrote a book titled Saving Capitalism from the Capitalists. As they write: "Throughout its history, the free market system has been held back, not so much by its own economic deficiencies as Marxists would have it, but because of its reliance on political goodwill for its infrastructure. The threat primarily comes from...incumbents, those who already have an established position in the marketplace...The identity of the most dangerous incumbents depends on the country and the time period, but the part has been played at various times by the landed aristocracy, the owners and managers of large corporations, their financiers, and organised labour."

In simple English, this basically means that those who benefit from capitalism are most likely to throttle it, after they have benefitted from it. As Rajan and Zingales write: "Policy making is often captured by powerful special interests that thrive because of the peculiarities of democratic governance... Governments may work in the interest of a privileged few rather than the larger public and dig the wrong channels." Hence, they say, it is important to save capitalism from the capitalists.

In India's case, it is important to save socialism from our socialists (read 'politicians') and ensure that benefits reach those who actually need it (like the rickshaw pullers of Ranchi), than those who are currently getting it (like the employees of Air India). Like capitalism needs to benefit the larger public, so does socialism, which it currently isn't.

Regards,

Vivek Kaul
Vivek Kaul
Editor, Vivek Kaul Publishing

PS: Now you can follow Vivek Kaul on Social Media and get Vivek's updates on the critical issues affecting the economy and your wallet... as they happen. Follow Vivek on Facebook, Twitter, and Google+.

Vivek Kaul is the Editor of the Diary. He is the author of the Easy Money trilogy. The books were bestsellers on Amazon. His latest book is India's Big Government - The Intrusive State and How It is Hurting Us.

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5 Responses to "The Rickshaw Pullers of Ranchi -- Saving Socialism from the Socialists"

SARVESH SHARMA

Jan 9, 2019

I agree with one exception. The most trenchant Indian style "socialists" in the government (with small g) are found not among politicians but among senior levels of bureaucracy. Any change of the type you propose is very hard to filter through these "socialists", e.g. Air India privatisation was sunk by the bureaucracy against the will of the political executive.

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Ramesh B

Jan 8, 2019

boss, your rickshaw pullers brief was wonderful! you should have ended there or extension should have been on that. but your weakness is-coming to the same old points-air india-psb-psu etc. hundred times. sorry, sir! with best wishes, i wrote you becoz, i like you. really!

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Vipul Jasani

Jan 8, 2019

The practice of one human being, cycling other human beings, which is still prevalent in parts of North and Eastern India, is something that needs to go. These are points which really cannot be argued against. I do not agree with above statement 100% even though it is true prima-facie. Unfortunately we as a society are very fast and energetic in any change that affects the poor/middle class people. We are not bothered about the adverse effects of change here it is cycle rickshaw people. I am not against change but adverse impact has to be addressed fully or to be minimized close to 100%. Another example is Municipal corporation. They are very energetic, enthusiastic and prompt to demolish the illegal building only after it is completed, sold and handed over to residents !!! Reasons known to everyone. There are many such examples in all fields if you observe and think from the point of view of people that are affected.

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Naval Patel

Jan 7, 2019

Excellent argument. But mere fulminations such as these get the sufferers nowhere. Recommend practical actions to halt such economic devastation.

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Pradeep Kumar Nair

Jan 7, 2019

Brilliant piece! Says it all and well :)

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