20/02/2015 8:19 PM IST | Updated 15/07/2016 8:25 AM IST

The Amartya Sen Interview: 'The Failure Of The State Is Continuing In India'

Indrani Basu

Prof Amartya Sen is once again in the news as he recused himself from being considered for another term as the Chancellor of Nalanda University, come July, for reasons he outlined in this open letter.

The Nobel laureate sat down with HuffPost India recently and spoke about a range of issues, including India’s continued failure to invest sufficiently in and nurture public education and healthcare, his thoughts about the new government at the Centre and the rise of the Hindutva discourse, Arvind Panagariya’s tenure at NITI Aayog, and his thoughts about the intellectual spat characterized as the “Sen-Bhagwati debate”.

This is the first in an exclusive two-part interview conducted in person and over email. These are edited excerpts.

HuffPost India: What is your assessment of the new government at the Centre and what would you say went wrong with the previous government?

Amartya Sen: Despite the successes of the previous, UPA, government — including achieving rates of economic growth never achieved by India earlier — there are three things that went badly wrong. Not just with the previous government, but it has been going wrong for quite a long time in India’s economic history.

One was the famous License Raj and the red tape that made it difficult for enterprises to be started, for initiatives to be taken. That was certainly a big problem. And I think the economic reform of 1991, in which Manmohan Singh played a leading part, was strongly addressed to that. It made many welcome changes, and yet it was never adequately completed. Files still move slowly, and progress of proposals can be held up, unless it is made “worthwhile” for the red-tape potentates.

If the first failure was about the government trying to do too much—in areas not well suited for government action—the second big failure took the form of the government doing too little in areas like public education, public healthcare and immunisation, in which it could have done a lot more, with great benefit to the people. India has consistently spent far less money on public health and public education as a proportion of GDP than countries which have had successful health transition and educational transformation, such as China, and in fact, across the political spectrum, no matter which way you look—in South Korea, Thailand, Cuba, Vietnam, Brazil, Mexico, Rwanda, not to mention Europe or America.

"The biggest failure of the Indian economic strategy"

I think India is the only country which has tried—and is continuing to try—to become an economic giant with a largely uneducated and unhealthy labour force. I think that is probably the biggest failure of the Indian economic strategy. The UPA government did not do anywhere near enough on this, and the opposition, which is now of course in office, did not give the UPA government any trouble whatsoever for not doing enough. It is, therefore, a failure of the state, not just of the government. That, by the way, is continuing.

"It is, therefore, a failure of the state, not just of the government. That, by the way, is continuing."

Third, the neglect of public services in healthcare and schooling is not just a matter of inadequate allocation of funding. We need a radical reorganisation of the way public services are delivered, particularly in schooling and healthcare. The government often chose to forget the task of improving public services and hoped that the private sector—in the form of private doctors even in rural areas, and private schools everywhere—would make it all right. Along with the reform of the license Raj, we needed more funding for public services and also much better run services, addressing the issue of public sector delivery directly, rather than seeking shelter behind the trusted magic of the private sector. These are three big failures, and I don’t see them being addressed even after the fall of the UPA government.

I read sometimes in the newspaper that I’m in favour of subsidies, and that is why I like public service entitlements. That is, of course, nonsense. I’ve always been opposed to subsidies aimed at the relatively rich (like on diesel or fertilisers or cooking gas). I do insist on good public education and public healthcare, but I don’t consider public expenditure on education and healthcare to be comparable to such subsidies. They are something much more central than that, and some would even see them, not without reason, as components of human rights.

When the US government—which is not exactly a great socialist country—pays for every American primary school child to go to school at zero cost, and they are even picked up from home by buses paid for by the state, this is not like subsidies on cooking gas. And similarly public healthcare; where the United States may not do very much (but that is changing), and yet if you look at the National Health Service in the UK, or anywhere else in Europe, everyone does get a healthcare coverage. To compare public education and public healthcare with subsidies on electricity for those Indians who are lucky enough to have power connection—a third of the Indians do not—would be a gross mistake.

HI: The mood in India on benefits and subsidies is in favour of a shift towards a direct benefit transfer regime. What is your view on that? And specifically in healthcare and education, do you think it’s possible that people are given money rather than the state running the delivery infrastructure?

AS: It depends on the field of services we are talking of. Cash transfers work well enough in some cases. For example, Jean Dreze and I have argued for cash transfers for famine relief for a long time. In fact when we argued for that in our 1989 book, ‘Hunger and Public Action’, we were criticised for arguing for “giving money to people who actually need food.” But cash transfers can rebuild very quickly destituted people’s ability to buy food, and food markets can rapidly develop, in many circumstances, to bring food to the people—armed as the former destitutes are with their new purchasing ability based on cash transfers.

But that is not likely to work so well for providing basic education and basic healthcare on a regular basis. In fact, in every successful country in the world, the government has tended to run basic public education, and in most countries, almost without exception, elementary healthcare as well. Whether it’s Britain, France, Germany, USA, Brazil, or Mexico, or (looking elsewhere) China, Cuba or Vietnam—the idea that the government can abdicate their responsibility of schooling the children by giving away money to the private sector, has been viewed with considerable suspicion.

"In every successful country in the world, the government has tended to run basic public education... and elementary healthcare as well"

The point is often made that if children are given “vouchers” for choosing between schools, the exercise of choice can give the schools the right kind of incentives. And so it can, in some circumstances. But there are two problems with doing basic healthcare or basic education through the private sector with vouchers. First of all, for children from poor families to have the benefit of choice, the adult family members have to know a fair amount about different schools, and have the knowledge to process information to evaluate different schools. For the first generation school-goers this is an unfair presumption, in general. In fact, given asymmetric information between buyers and sellers, on which there has been such a lot of studies in economics in recent years, the assumption that the parents are well informed—or can easily make themselves well-informed—on the relative merits of different schools can be an over-exacting demand.

This is not to deny that there is a good argument for a voucher scheme when the parents are in a position to exercise their options with discriminating information, and when there is competition between good schools to which the children have access. But there’s a kind of unreality in making that a general presumption across India, with its massive generational illiteracy. You are dealing with many children whose parents never went to school, and they may not even know what is being taught there, and how it is done. It is not India only that has a problem here. Indeed, no country in the world has been able to make itself literate without massive use of state schools—from Britain, USA and Japan in the past, to South Korea, China, Thailand, or Vietnam in our time. Private schools may have a supplementary role, but that is additional to the availability of reliable public education.

"The miserable people who have no public health care remain prey to bad private services"

Second, the problem of asymmetric information applies even more strongly for healthcare. Kenneth Arrow wrote a long long time ago about why the patients are hardly in a position to know what they need and what is being delivered by their doctors. The general way that the market economy operates efficiently, when it does, is through well-informed buyers as well as sellers. When, for example, you are buying an umbrella or a pair of shoes, you know as well as (and in fact probably even better than) the seller about how the shoe fits you. However, in the case of a medical treatment, that is not the case. You have a fever. You’re not feeling well. You don’t know what kind of an illness it is. And to say that you get the money and you exercise some judgment on the best doctor who can deal best with your condition—there is a total unreality about it. Instead, the miserable people who have no public health care remain prey to bad private services often offered at penal costs.

So it is not a surprise that from Brazil to South Korea, from China to Cuba, from Britain to Italy, basic health delivery has been done by the government. No country has achieved what in the medical literature is called a “health transition” without extensive public efforts and widespread public healthcare.

HI: Isn’t the problem also one of accountability?

AS: Indeed, it is. The public services need more accountability, but in their own way so do the money-making private entrepreneurs selling healthcare to uninformed people. But going further, it is not just a question of accountability. Accountability is a way of catching a thief. These systems—the National Health Service in Britain, for instance—is not run by accountability, it’s run by responsibility. You’re not trying to catch a thief, you’re trying to create a system where the doctor has a strong sense of responsibility, and is motivated to care for people’s health, rather than just making money. If we have to rely just on “thief-catching”, the battle would be impossibly hard.

"A change of culture requires a vision that guides policy making as well as individual behaviour"

To create a basic sense of social responsibility you have to break the idea that making money through essentially unfair means is somehow “standard practice.” Accountability, without a sense of responsibility, will give us a way of suing everyone — but I don’t think we can get anywhere like that. We need a change of culture. But a change of culture requires a vision that guides policy making as well as individual behaviour — and the eradication of a culture where everyone feels justified in being irresponsible and self-serving on grounds that “everyone else does it”. I think we require a basic change in the education and healthcare delivery at all levels, but particularly at the elementary level where poorer people are hit the most.

HI: What kind of change would you prescribe? Most people’s experience right now is that it’s creaky, and as you rightly mentioned it doesn’t work, or there are horror stories. Would you recommend a radical revamp, or would you prescribe an every day approach to changing things gradually?

AS: Well, things can change and have done so in other countries. First, we have to recognise that some behaviour patterns are a major problem and deserve the strongest of ridicule and social stigma. We must not assume that what other people think has no effect whatsoever on how people behave.

"The attack on corruption that has become such a political issue (under AAP, for example) must be very welcome"

Second, there is a huge role of public discussion on behaviour norms, accompanied by some naming and shaming too. There are places, even in India, where public services do work reasonably well. With all its faults, Tamil Nadu has good public services. Kerala has also reasonably good public services. But this has been done by not just catching thieves, it’s by generating a climate of behaviour, which becomes a standard of behaviour that the population demands.

The attack on corruption that has become such a political issue (under AAP, for example) is also a part of that constructive story, and must be very welcome. Corruption would tend to go and lose its grip when corrupt behaviour would look like abnormal behaviour, rather than what everybody does. And so I think the public discussion, public engagement is very important in that.

Tomorrow, in the second part of this interview, Sen discusses the "Bhagwati-Sen debate", his upcoming memoir and whether he worries about his ideas being misrepresented.