If, it
may be asked, holding large reserves is unwise and
getting rid of reserves through an appreciation of the
rupee even more so, what should the country do?
Obviously, if there was an agency that undertook
productive investment either using the reserves or on
the strength of these reserves, i.e. using these as
cushion (since plenty of unutilized domestic
industrial capacity also exists), then they would have
been put to some good use. The only such agency can be
the state (since capitalists’ investment decisions are
spurred by their own calculations and cannot be
stimulated just because the country has a plethora of
unused resources). True, even if the state undertook
investment on the strength of these reserves and used
up a substantial chunk of them, when the time comes
for finance to flow out the country may still find
itself short of funds (unless the investment
undertaken in the meantime earns sufficient foreign
exchange). Some degree of control over capital flows,
therefore, would have to supplement larger state
investment. In short, a combination of capital
controls and larger state investment is required if
the country is to cope with the burgeoning capital
inflows.
But both these are anathema as far as the theoretical
orthodoxy in the west is concerned. There may of late
have been some grudging admission of the need for
capital controls, but larger state investment is
taboo, especially for third world economies. The only
reasonable way of coping with financial inflows is
thus closed to us if we follow the lead of the
dominant theoretical orthodoxy in my discipline. This
fact only underscores the absolute need for
independent thinking in societies like ours.
Of course, simply having institutions of higher
education does not mean that this need gets
automatically fulfilled. A whole range of measures
have to be undertaken to ensure that these
institutions play the role that they should; but that
is a separate, albeit vital, issue. Not having any
such institutions completely forecloses the
possibilities of any independent thought.
IV
The
pressure for ‘professionalization’ is one persistent
factor working towards the destruction of independent
thought, and thwarting the emergence of institutions
capable of producing ‘organic intellectuals’ for our
society. In addition to this, two other specific
factors have emerged in recent years which work in the
same direction. The first is the tendency towards
privatization which has gathered momentum on account
of the fiscal crisis of the state. This crisis existed
even earlier, but it has become greatly accentuated by
the pursuit of ‘neoliberal’ policies at the behest of
the Bretton Woods institutions since the beginning of
the 1990s.
The fiscal constraints on an economy pursuing
neoliberal policies are obvious. Since
‘liberalization’ must include trade liberalization,
customs duties must be brought down; since the state
which lowers customs duties cannot simultaneously
increase excise duties (for otherwise it precipitates
gratuitous deindustrialization by favouring imports
over home production), its capacity to raise revenues
from indirect taxation as a whole gets reduced. To
entice foreign capital, which is supposed to play a
central role in ushering in development, it must lower
direct taxes on such capital (whether or not foreign
capital actually comes), for otherwise capital would
go to destinations with lower tax rates. To maintain
some inter se equity between foreign and
domestic capital, the latter also cannot be taxed too
heavily, so that corporate tax revenue shrinks
relatively, which cannot be offset, again for reasons
of inter se equity, through larger personal
income taxes. It follows that the logic of a
‘liberalized’ economy is to reduce the tax–GDP ratio.
This in fact is what has happened in a
host of economies adopting neoliberal economic
policies, and India is no exception. If we take
triennium averages, there was a reduction of 1.6 per
cent in the ratio of central gross tax revenue to GDP,
and 1.3 per cent in central net tax revenue to GDP
between the triennia centred on 1990–91 and 1999–2000.
Even taking the lower of these figures it turns out
that if only the same tax–GDP
ratio had been maintained at the end of the decade as
prevailed at the beginning, prior to ‘liberalization’,
the central government would have garnered an
additional revenue of Rs 26,000 crore in a single
year.
There is an additional fall-out of ‘liberalization’.
It invariably entails an increase in the rate of
interest that the government has to pay on its
borrowings. An estimate for India, for instance,
suggests that the increase in the interest burden of
the public exchequer on this score, even without
taking into account the compounding effects of higher
interest rates, was as much as Rs 13000 crore in
2001–02. The total drain on the central government
exchequer of both these measures therefore amounted to
about Rs 40,000 crore at the end of the decade of the
1990s, compared to the beginning of the decade. And
the centre ‘passed on’ this ‘drain’ to the state
governments, making the latter’s fiscal situation
precarious.
The effect of all this, together with the fact that
the fiscal deficit under the neoliberal dispensation
is supposed to be kept under strict control, is a
curtailment in total government expenditure, which has
a particular impact on expenditure on social sectors
like education and health, and which unleashes in turn
a tendency towards privatization of these sectors.
The implication of privatization, which necessarily
brings in a profit-motive into the sphere of
education, has been missed by many, including several
sensitive thinkers who see no harm in it. If education
becomes a business, it loses its capacity to produce
‘organic intellectuals’ for the people. Education is
not a homogeneous good, like steel or cement, which
can be produced by the public and private sectors
alike. Education, seen as the product of educational
institutions, is fundamentally heterogeneous.
Education that enables a person to get a well-paid job
in the existing job market is not the same as
education that produces an ‘organic intellectual’ of
the people (a distinction analogous to the one that
Paul Baran drew between the ‘intellect worker’ and the
‘intellectual’). To draw this distinction is not to
say that ‘organic intellectuals’ of the people should
be incapable of obtaining a job in the job market; the
point, rather, is that even while imparting education
to enable persons to obtain jobs and serve the country
as ‘intellect workers’, education must
simultaneously ensure that they do not remain mere
‘intellect workers’ but also become ‘intellectuals’,
in the sense of ‘organic intellectuals’ of the people.
Privatization of education produces exclusively
‘intellect workers’, and no ‘intellectuals’.
The matter can be put somewhat differently.
Privatization turns education into a commodity where
the buyer’s preference must necessarily enter to
determine the nature of the commodity produced. There
is a basic difference between education that satisfies
the preference of the buyer and education that is
undertaken in the interests of the people. If
education is to be undertaken in the interests of the
people, to defend their interests, it must be
publicly financed. If it ceases to be publicly
financed, the education that increasingly gets to be
produced is one that is intrinsically incapable of
serving the interests of the people. (To say this is
not to ask for a ban on private institutions of higher
education but to emphasize the need for a
predominantly public educational system, into which
private institutions must fit. The modalities of where
and how they can fit in have to be carefully worked
out.)
But then, it may be asked quite pertinently: how can
we ignore altogether the dictates of the market? In an
era of the IT revolution we have to have people with
IT expertise. Universities consequently have to orient
themselves towards imparting knowledge on IT rather
than continuing to emphasize traditional subjects like
the liberal arts and producing unemployable graduates
even as the country misses out on the new technology
that is unfolding. In other words, the market is a
signalling device which indicates changing demands
that are by no means socially irrelevant. Ignoring the
dictates of the market, therefore, is a perilous
venture for any society.
It seems to me, however, that the objective of higher
education that I have been outlining is perfectly
compatible with the other purpose which education
serves, namely, to impart skills, the nature of which
changes with changing technology. Sensitivity to the
latter need is not synonymous with the commoditization
of education. The point at issue is the exclusive
determination of educational priorities by the market.
Privatization of education has a tendency to lead to
such exclusive determination not just in the
privatized segment, but in the sphere of higher
education as a whole, through the pressures it brings
to bear on the non-privatized segment.
Some contend that if the state is afflicted by a
fiscal crisis, it ipso facto implies that the
people are not paying for producing ‘organic
intellectuals’ for their own cause, i.e. they have
implicitly ‘voted’ not to have such ‘intellectuals’.
Too many tears should not, therefore, be shed over
this fact, for the people themselves want it this way.
It is not the ordinary people in the country, however,
who have been the beneficiaries of the reduction in
the tax–GDP ratio which underlies the fiscal crisis.
On the contrary, while the tax concessions have gone
in favour of the rich, the ordinary people, especially
in rural India, have suffered from the effects of
deflation via unemployment and cuts in social
expenditures. They are not the votaries but the
victims of these cuts. Privatizing higher education in
this context has the effect not only of excluding them
from its ambit, but also of muting whatever
intellectual opposition exists against the policies
that victimize them.
The need for nurturing such intellectual opposition
arises not out of charity, or out of a mere
transcendental commitment to democracy and
egalitarianism. It is essential for social peace,
indeed for social survival. Society can ignore this
need only at its own peril, for in the absence of an
intellectual articulation of the plight of the
victims, in the absence of ‘organic intellectuals’ who
can provide such articulation, the opposition of the
victims to their plight takes on highly destructive,
socially debilitating, and extreme and unproductive
forms, such as terrorism, which cause much suffering,
usually pointless suffering, all round.
V
One
cannot be critical only of privatization of higher
education without raising one's voice against another
phenomenon that has been quite pervasive until now,
namely the appropriation for purely private ends of
public education. I have in mind the fact that a large
proportion of the products of prestigious institutions
of higher learning in our country, such as the IITs
and medical institutes like AIIMS and PGIMR, whose
education is financed in large measure by the ordinary
Indian masses, who are among the poorest people in the
world, then migrate to the advanced capitalist
countries to make a comfortable living for themselves.
I do not blame them for one instant. But I do blame
our successive governments for having turned a blind
eye to this phenomenon and permitted the continuation
of a state of affairs where the poorest in the world
are made to subsidize the health system of the richest
in the world. Even if no restrictions on emigration
are placed, at the very least a minimum period of
service in India could be demanded, or a refunding out
of their sumptuous salaries abroad, of the expenses
incurred by the country on their education. Nothing of
the sort has been imposed, and the country has handed
over gratis, skilled persons trained at the
people’s expense, to advanced countries.
What is more, they have been lionized, notwithstanding
their choice to leave the country. Their paltry
contributions, setting up a hospital here or donating
some money to their alma mater there, have been
much heralded by the media and the government; by
contrast, they have been resoundingly silent on the
massive transfers, amounting now to well over $10
billion per annum, by poor Malayalee Muslim migrants
to the Gulf, which have been a major prop of our
balance of payments. In the case of the other
migrants, skilled doctors and engineers, whose
transfers have been paltry, we have a clear case of
private appropriation of public resources. The fault
here lies not with the appropriators but with those
who allow it. Their lionization, moreover, amounts to
encouragement of such appropriation. It is imperative
that the struggle against privatization of education
be complemented by a struggle against such
privatization of public resources in the sphere of
education.
VI
The
second factor which works in the direction of
enfeebling the generation of ‘organic intellectuals’
in our society is the increasing sway of communal and
obscurantist forces over the sphere of education.
These forces, at any rate segments of them, often
claim to be fighting the ‘western’ influence on our
education system (two names that figure in their
perception of the ‘evil trinity’ being Marx and
Macaulay). Paradoxically, however, they end up
strengthening the very ‘western influence’ that they
claim to be fighting. Their attempt at the
introduction of courses in state-funded universities
to turn out purohits and astrologers, on the
explicit argument that there is a market demand for
them, is as much a ‘commoditization’ of education as
the demand for capitation fees and the substitution of
basic disciplines by more ‘marketable’ subjects.
Likewise, their attempt to change textbooks to make
them conform to the prejudices of a handful of bigots
on the ground that nothing offensive to the ‘religious
sentiments’ of the ‘majority community’ should be
carried in such books, is antithetical to the spirit
of scientific inquiry without which there can be no
‘intellectuals’, let alone ‘organic intellectuals’ of
the people. The retreat to prejudice, the promotion of
obscurantism, the substitution of extraneous criteria
for scientific investigation in evaluating the worth
of academic propositions—all of these entail a
devaluation of the content of higher education which
actually disarms the country intellectually against
the onslaught of imperialist ideology. At a political
level, communalism and fundamentalism divide the
people and contribute to a weakening of the nation
vis-à-vis imperialism; at an intellectual level, they
make a parallel contribution by obliterating the
intellectual capacity to see through their
machinations. Opposition to the ideology of
imperialism, one must remember, was provided by an
inclusive Indian nationalism that was secular,
democratic and self-confessed by socialist.
Communalism, whether of the Hindu or the Muslim
variety, never had an anti-imperialist thrust. Should
it come as any surprise, then, that the emergence of
communal politics and ideology also paves the way for
reassertion of the hegemony of the imperialist
ideology?
VII
I have
gone on long enough. Even though a degree of ritual
sermonizing is de rigeur on occasions such as
this, nonetheless these are basically happy occasions,
occasions for celebration: for the university for
completing yet another fruitful year, and for the
young scholars for entering into a new life and new
responsibilities. Now that I have done my bit of
obligatory sermonizing, I wish to join you in the
celebrations. May I warmly congratulate the young
scholars who are receiving their degrees today and
wish this university many more years of productive,
distinguished and fruitful life? Thank you for your
attention.
Prabhat Patnaik
