October 21, 2010EconomyPublic Policy

What this criticism of the UID reveals

To oppose the UID project on the grounds that it makes government services efficient is bizarre

This is an archived blog post from The Acorn.

Over in the op-ed pages of The Hindu there’s a surreal op-ed by R Ramakumar that argues that Aadhaar, India’s new Unique Identification (UID) project will lead to an invasive state security-wise and a retreating one development-wise. Now reasonable people can debate whether or not UID will lead to these outcomes, and whether these outcomes are desirable or not. But reasonable people cannot argue that the government must spend money indiscriminately. That, however, is exactly what Mr Ramakumar argues! The UID project, he alleges aims to keep benefits restricted to the so-called targeted” sections, ensure targeting with precision and thereby, limit the government’s expenditure commitments.”

How will UID lead to human rights violations? Mr Ramakumar’s argument is Because Amartya Sen says so.” Appealing to authority is not quite the most persuasive way to make such an argument. The fact that the UID is not compulsory and the fact more than 500 million Indians have mobile phones—it’ll takes years before that many people get their Aadhaar—that are already capable of being tracked and profiled is ignored.

Let’s face it: the very existence of the state is a compromise on individual freedoms—and an implicit contract where a citizen derives some benefits in return for curbing some of his freedoms. It is fair to contend that the UID subtracts some freedoms. But it is ridiculous to jump to the extreme conclusions that such subtractions are violations”, not least because those who do not want to make this trade-off need not make it. We can’t say the same about so many of the Indian government’s policies.

Mr Ramakumar’s second objection—that it will lead to the qualitative restructuring of the state in the social sector—, if accurate, is a very strong argument in favour of the UID project. It is unfathomable how anyone can argue that targeting social welfare schemes on those who really need it and eliminating inefficiencies and wastefulness is a bad thing. It is unfathomable why Mr Ramakumar should presume that the poor will somehow be better off if the state directly distributes food to them when the epic, systemic and self-evident corruption in the public distribution system (see an example) has so miserably failed to deliver.

Indeed, it remains to be seen whether the gargantuan political economy of massive corruption in the PDS will permit the use of an instrument like Aadhaar. It’s unlikely that the UPA government has the incentives or the will to push through such a transformational reform. The ultimate social welfare programme is a system of targeted cash-transfers to the genuinely needy. The UID project, if implemented properly can make such a programme technically feasible. It requires a high degree of incredulity to believe, however, that technical feasibility is the only, or even the main problem, holding this proposal back.

Mr Ramakumar confuses socialism for development. If the state retreats from the business of buying, storing, transporting and retailing groceries, it will certainly hurt socialism. It won’t necessarily hurt development.

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