A few notings before voting

Nation is slowly entering in to election mode and we can see a lot of heated and often polemic arguments about performance of NDA government. Supporters of either side are arguing with their own data sets and narratives to prove their point. In this write up, let’s see some parameters with which we can measure the performance of any government of the day and can vote accordingly.

1)      Correlation is not necessarily be  causation- 

We often confuse between causation and correlation and thereby misjudge the performance of a particular government. There can be in correlation between umpteen numbers of variables and we can very well plot it on a graph. But unless those correlations can be intelligently explained as having any causation, it cannot be attributed as failure or success of a particular policy.

For example, one can have a correlation between increased financial allocation to irrigation in budgets and increased agricultural production. However, it is not necessary that money for irrigation was spend efficiently and resulted in more lands under cultivation/ irrigation and hence increased output. Agricultural output could have jumped due to increased use of better technology, seeds, good monsoon etc. Only carefully designed empirical tests can determine existence of any causation in a correlation.So before we give credit to government, we have to see whether this particular outcome was the result of a conscious policy or it just happened because of something else. 

2)      Necessary but not sufficient condition-

    We often blame our government for not doing enough, or a particular policy being ineffective for achieving a stated goal. This happens particularly in matters related to GDP growth rate, employment creation, tax collection etc. It is true that government play a critical role as an economic actor but its command over economy is not absolute.

     Many of the efforts and policies of the governments come under ‘Necessary condition’. For example, liberalizing FDI related regulations, easing labor laws or constructing Highways etc are Necessary condition for  increased investments ( and there by economic growth) but not a Sufficient condition. This policy will have a visible impact only if it is accompanied by a similar reforms in other areas which may be more difficult to accomplish ( for example, improved law and order, ease of acquiring land, ease of contract enforcement etc). Thus, when sufficient conditions are not fulfilled, the effectiveness of necessary condition would be minimal.

     A voter has to see whether the government is moving in right direction and have taken enough possible steps, and our judgement should not be blindly depend on whether it had resulted in any visible success or not.

3)     Random events are not patterns-

     Voters should see that many events and happenings in our country are random in nature and may not be occurring as a predictable pattern. However, both government and its opponents will try to see that these random incidents are forming a pattern and hence are a failure / success of a government.

     For example, ‘escape’ of Vijay Mallya, Lalit Modi and Nirav Modi are seemingly random events and we need not attribute a pattern to it.  For concluding it as a pattern, we have to see whether there is any binding commonality in it and whether any government policies, attitudes are responsible for that. If not, these incidents can be seen just as random events which can happen at any time. Hence, these stray events should not influence our voting decision. In the words of Nassim Nicholas Taleb, one must not be Fooled by randomness.

4)     Counterfactual scenarios-

Opposition regularly blames government for a particular policy or an event where they accuse the government for failing to act.  They appeal the voters to punish the government for not producing desirable outcomes.

However, before falling prey to such appeals of opposition parties, voters should imagine and construct a counterfactual scenario where in which

a)     What this present day opposition would have done under similar situations, if they were in power ?

b)     Would the scenario were been better under them and could they have managed it better?

              This is a tough challenge as none can exactly re-imagine a counterfactual scenario. However, we can come to certain probable scenarios based on our experiences of past policies of the present day opposition.

For example, opposition accuses the government for ‘failing to create jobs’, lower economic growth rate etc. We should think of a counterfactual situation wherein which opposition party being in governance and under similar circumstances, whether the economic growth would have been higher than otherwise and whether they would have created more jobs.

If you believe that the stated policies of the opposition (as they practiced earlier) would have been helpful to create more jobs or higher growth rate, you have every reason to support and vote for them. If not, there is no reason why you are blaming present day government for job problem.

5)     Lag effect- 

Positive or negative impact of a policy reforms will come out and get reflected on macro-economic figures only after a lag period. For example, a populist budget with a lot of ‘give aways’ will result in increased fiscal deficit. Yet, this higher fiscal deficit will translate in to higher inflation and other bad consequences only after a lag of more than a year or so. Similarly, reforms in labor or land markets will reflect in higher investment and job creation, but after a couple or more years.

It often happens that an incumbent government takes a painful policy decision for which it get voted out but the next government get credit for having higher economic growth rate owing to those reforms. A result oriented policy reform will always be painful in the short term and may adversely affect some vested interest. Similarly, a government can make mess out of its last years, will sit in opposition benches next time and accuse the government of the day for ‘low economic growth’. Unfortunately, people often attribute low economic growth to the present day government without realizing that it could be because of past policies of previous government. 

An intelligent voter should see that a low economic growth need not be due to failure of a government or its policies. He should decide whom to vote based on whether the policies of the government are helpful for the larger and long term interest of the economy or not. In other words, voting decision should be based not on the past 5 years of data, but on the expected macroeconomic figures for next 5 years.

Having said all these, the author realize that an ordinary voter would take a call based on his or her perception about the performance and not go by examining and analyzing data sets on his excel sheets. Any government of the day has to fight this perception battle to get re-elected and can’t win an election using raw data and logical arguments alone.

Broken windows of Government offices

Visiting a typical government office, whether state or central, is unlikely to be a pleasant experience. Most of them are poorly maintained, if not in completely dilapidated condition, with broken window panes, un-aesthetic furnishing, smelly toilets, corroded fittings and fixtures, peeled paintings with gutkha stained walls. Employees, many times, are likely to be cold, unwelcoming and sometimes plainly arrogant.

Overall, this is in direct contrast with the modern office complexes what private sector offers to it's employees. Perverted ideas of socialism and frugality ensured that our governments spend too little on its buildings and that too in a tasteless manner with shoddy engineering. While the government is keen on improving its quality of service, reducing corruption and removing inefficiencies, perhaps the most necessary yet neglected part are it's buildings itself.

Broken window theory was popularized and practiced by the then New York police commissioner Mr William J Bratton, in mid 90 s, where he maintained that prevention of minor crimes is an absolute must which will automatically leads to reduction in major crimes as well. The underlying idea behind this concept is that an orderly environment fosters a sense of responsibility and hence makes general public to respect the laws of the land. This will lead to increased confidence in the scheme of things and will deter any potential criminal to commit crime.

Physical environment in which we live and work, substantially alter the way in which we think, feel and act. We constantly receive and radiate signals and cues to our physical surroundings that can have major impacts on our actions and behavior. Human beings are instinctively conformists and looks towards others and surroundings to guide their actions. When we work in a pleasant and orderly environment, our behaviors and attitudes will unknowingly and automatically conform to the values that are representative of our surrounding.

Now let us pause for a moment and ask ourselves why and what it implies if we see broken windows and smelly toilets in government offices?

a)     Lack of sense of belongingness and ownership- None of us would like to have unclean toilets in our own home. If we see a bad toilet in a public office, it implies that there is no sense of ownership and belongingness for the people who are working there, and so are they keep it smelly.

b)     Sense of helplessness- Even if they genuinely feel that they have to keep their office in good shape, many times, they can’t, as necessary funds are unavailable. It is also possible that institutional constraints and financial rules discourage them to set their office in order. In any case, it shows the helplessness of the people who are working there and theirs powerlessness to manage their own affairs.

c)  Weak supervision- Above anything else, a smelly toilet is a symptom of weak or ineffective supervision. It reflects the senior officer’s apathetic attitude towards the basic necessities of people working under him. Most of the time, it is not about bad toilets as such, but is about how bad it is managed.

d)     In most of the offices, we see that senior officers keep their room impeccably clean, beautiful with well cleaned toilet and swanky furniture. Outside it, is a contrasting scene where the lower ranked officers and staff are sitting and working in not so inspiring condition.  This chasm itself is a reflection of a distrusting environment and selfish behaviour where individual officers hoards more resources resulting in a disempowered and de motivated work force.

e)     Plain indifference – Many officers and staff have conditioned and habituated to work with it and they feel no need for change. This inertia keeps people to persist with old habits and they can’t re-imagine that better alternatives are possible.

Generally, it is the combination of above 5 factors which reinforces each other results in this state of affairs. It implies that smelly toilets itself is not the problem, but is about the message that is communicated to all by having such a state of affairs.

After examining the cause and effect of this chaotic environment, let us see what are the possible pathways with which it can leads to inefficient and substandard public services. There will be multiple psychological forces at play many of which would be hidden and few will be explicit in nature.

a)     An unclean and unorganized office leads to a possible belief amongst the employees that the employer (or ‘department’ in this case) is caring less about their basic need to have a pleasant workplace. A ‘careless’ employer ends up with a de-motivated employee who in turn will game the system to his advantage. This in turn can drive them in to all kinds of dishonest activities.

b)     Priming effect – We can prime people in to certain forms of behaviour by offering simple and apparently irrelevant cues. A citizen who comes to that office for consuming a public service will be instantly repelled and de-motivated by seeing chaos there. He will be primed to think that no efficient and speedy services can be expected from this office and if officers can’t manage and organise themselves, they are least likely to address his concerns in any efficient manner.

c)     An officer working under these chaotic environment would be spending much of his time and cognitive energy to struggle against all the odds and would be left with very little bandwidth to perform his ‘core duties’ of public service.  In other words, a bad office surroundings ‘crowds out’ his inherent motivation.

Perhaps the most important reason why our government officers are infested with corruption and inefficiency is that, our public servants are not motivated and incentivised enough. Our traditional view is that enhancing salary and improving career opportunities will motivate them. Despite this being true to a large extent, our policy makers should also explore the possibility of increased motivational level through improved working environment. However, unfortunately, we have underinvested in our office buildings, with the assumption that it doesn’t have much implication in efficient delivery of public services.

Red-tapism, inefficiency, corruption can be seen as social habits that have been institutionalised in many government offices. These habits are highly persistent and can’t be ended by simple preaching and pledging. To make a serious change, some exogenous shocks have to be administered.  Renovating and beautifying our government offices are one such ‘shock. This is a low hanging fruit amongst all similar Administrative reforms which most of them  are tough to implement and perhaps politically unviable.

In conclusion, if we borrow the idea from Broken Window theory and apply it in this context, the message is simple and clear. If we want to reduce corruption and make our public services efficient, then the first step towards it is clear,- fix the broken windows and clean its toilets.