Middle class: vote and revolt

The second dimension is one of political calculation. Every political leader has to make calculations of who to cater to. Mitt Romney decided that the bottom 47 per cent would not vote for him, so why bother. Sonia Gandhi believes, and has believed, that India has mostly poor people, and that the situation has not changed much from when her mother-in-law was the boss 30 years ago. So just be populist and a 273-seat majority is within sight.

Misreading of the mandate comes from misreading India. Between 1950 and 2012 (see table), the consumption distribution has not changed much so the gains have accrued in almost equal fashion to all Indians, the poor and non-poor. Note that per capita GDP, in US dollars, increased from 60 in 1951 to 181 in 1977, to 1,500 in 2012. The proportion of poor declined from an estimated 87 per cent in 1951 to 22 per cent during the same period.

Also shown in the table is the proportion of the middle class. Since my 2007 study, Second Among Equals: The Middle Class Kingdoms of China and India, there has been an "offering" from virtually every international organisation. Each offering has a slightly varied definition, presumably in order to preserve "originality". In the main, these definitions of the middle class has the Indian proportion at somewhere between 10 and 25 per cent. By my 2007 definition (see table), the size of the middle class is much larger and in 2012 is estimated to be 53 per cent of the population.

Estimates of middle class matter. If the political leadership accepts the World Bank/ ADB numbers as even quasi-authentic, then it is no surprise that the Congress politicians wantonly disregard any signs of middle-class anger and revolt.

Most of the welfare programmes UPA 1 and 2 have proposed and/ or implemented (such as, MNREGA, the food security bill, diesel subsidies, etc) are both populist and hark back to an era when state control and involvement was considered essential to the removal of poverty. This "vision" did not help much in either generating growth or alleviating poverty. But perhaps the Congress has an old person's dated memory it ruled India for all but three of the first 43 years of independence. Poverty was high, incomes were low, the middle class was non-existent, and the Congress got re-elected every time. Their leaders were hailed as god-sent for example, the Congress refrain "India is Indira, Indira is India."

... contd.

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