Today's Editorial 03 September 2014

         A republic of experts

Source: By Ashok V. Desai Modi: The Telegraph
I have recently been giving talks on economics to intelligent non- economists. It revealed to me a difference between economics and the natural sciences. A non- scientist who goes to a talk on science is unlikely to claim any knowledge about the subject. But non- scientists often come with well- formed, even if incorrect, economic preconceptions. They will firmly believe that the oil crisis was orchestrated by the American government, or that the industrialization policy was a personal invention of Jawaharlal Nehru. The preconceptions generally are only tangentially related to facts; they are closer to conspiracy theories, which are typical of paranoia.

They are so strongly held that they would seem to be a part of their holders' religion or psychosis. Thomas Piketty puts this point somewhat differently in the introduction to his famous book, Capital in the 21st Century. He points out the strong convictions of many people about trends in distribution: some believe incomes have become more equal, whilst others believe just the opposite, and both engage in a dialogue of the deaf. "Social scientific research is and always will be tentative and imperfect. It does not claim to transform economics, sociology and history into exact sciences. But by patiently searching for facts and patterns and calmly analyzing the economic, social and political mechanisms that might explain them, it can inform democratic debate and focus attention on the right questions.

It can help to redefine the terms of the debate, unmask certain preconceived or fraudulent notions, and subject all positions to constant critical scrutiny. In my view, this is the role that intellectuals, including social scientists, should play, as citizens like any other but with the good fortune to have more time than others to devote themselves to study ( and even to be paid for it — a signal privilege)." In other words, intellectuals are common people just like the opinionators in my audiences, but are trained to judge the solidity of evidence, and eliminate wrong or poorly grounded positions.

I thought that Piketty's point was relevant to the debate that currently rages about the future of the Planning Commission. Intellectuals have been writing feverishly in the press; almost to a man, they are shocked by the prime minister's decision to disband the Planning Commission. I do not have to go into their arguments in its defence; but it can be confidently said that none of them makes Piketty's point. The reason is obvious: whatever its original conception, the Planning Commission never publicly played an intellectual role. In the beginning, it was the product of a religion called socialism. Later it was used as an implement to steer the economy in directions favoured by the rulers, which changed marginally from time to time.

That was not so always. I had informal entry into the Planning Commission in the 1960s because my brother Mahendra was its information adviser. At lunchtime, the bright young economists assembled by Pitambar Pant in the planning unit of the Indian Statistical Institute would gather together in Mahendra's room and vigorously debate economic issues. But that debate was confined to Yojana Bhavan; people outside got no inkling of it. Indian governments have hosted limited economic debates from time to time, but always within the confines of ministries. And in recent decades, they have never involved anyone who differed with official positions in a meaningful way.

So I would not have shed tears on the demise of the Planning Commission. But then, the prime minister has gone back on his promise to demolish it. He may not have changed his mind about its uselessness or malignity as the case may be. Perhaps he was overwhelmed by the barrage of criticism that followed his announcement; maybe he felt that he had overreacted. Anyway, he asked the public to give him ideas about what to replace it with; and Yashwant Sinha has been collecting the views of selected prominences for him.

This is where Piketty's point comes in. I understood its relevance when, some two decades ago, I spent two years advising the then finance minister, Manmohan Singh. I realized the naïveté of the views of my political masters: not just theirs, but also of their bureaucrat advisors and implementers. I tried to improve their judgment. But my views were confined to file notings and interventions in the meetings of senior bureaucrats the minister called in his room. They did not even extend to larger meetings, with other ministers and their bureaucrats; no one spoke there except on the finance minister's invitation, and he never asked anyone except Montek Singh Ahluwalia.

So the prime minister has two problems to solve: whom to plant in the Planning Commission, and how to bring their wisdom to bear on his ministers — for they too are common people, and even more impervious to wisdom because they tend to attribute their political success to their own wisdom. I shall give a brief answer since I have only 400 words left.

The prime minister should recruit 139 bright young economists — let me call them gophers — chosen not just for their knowledge but also for their communicative ability, and plant them in rooms on the ground floor of the new thought commission. Any moderately important person ( MIP) — which would include any minister, bureaucrat down to joint secretary, or member of parliament — should be entitled to approach any gopher with a question, personally, on phone or by email. The gopher would give an immediate answer, or tell the MIP by when he would send an answer.

The gophers should have a library within the building at their disposal; it would comprise any book, article or document they may ask for. The librarian may get them from one of Delhi's many libraries, official and unofficial, or abroad, but once received, they must be digitized: the library must aim to become India's most comprehensive digital library, and give free universal web access to all its holdings, except those under copyright.

Why 139? That is the number of best Indian economists listed by RePec in its Ideas list. These are the Indian economists who have published work that meets international standards. Each of them should have one of the 139 gophers attached to him or her; the gopher should consult his or her mentor in case of doubt. The 139 economists should have free access to the new library, and be able to use their gophers as research assistants. They should get a fellowship to come and live comfortably in Delhi whenever they want to work in the thought commission.

They should be invited to give at least one talk a year, attended by a minister, on topics of interest to ministers. They should hold at least one conference a year on policy matters, open to MIPs. The MIPs and gophers should be free to take their advice on a consultancy basis. In brief, the Planning Commission should be converted into a market for ideas; the MIPs should be the buyers without having to pay.

India's best economists should be the sellers, but not profit maximizers. The product should be good economics, which should go into policy. The output of the thought commission should be exposed to the critical view of the entire world.