8 February 2021, NIICE Commentary 6785
Dr. Binay Kumar Pathak
Politics and Economics are mutually influencing both in the realms of the disciplines and the actors involved. Economics, the science dealing with allocation of resources for the welfare of masses, identifies two actors for the purpose – the Government and Market. The Government, a pervasive force controlling every sphere of life, has undergone different forms and mechanisms from monarchy to present day democracies. Market, the institution of exchange, can be understood as private operation of production and trade. As production depends on resources owned by the society, the market cannot proceed without the provisions and incentives provided by the government which in turn depends on revenue from economic activities to manage the affairs of the state. While merchants lending money to rulers for warfare and imperialist motives denoted the dependence of the ruling class on merchants; the rulers granting exemptions to merchants for trade and production has been one of the key characteristics of the monarchies and the feudal system. Modern democracies have tend to formalise the association between the Government and the Market. These formal associations are known as public private partnership (PPP). .
Like the interrelationships between the government and the market, the PPPs also have two dimensions-domestic and international. Within the domestic context, they are supposed to seek answers to failures of allocation by working jointly. A close look at some of the cases reveal instances of joint failures and their implications for stability of the economic and political systems can be gauged with the emergence of populist governments in many countries of the world. The populist upsurge fees on unfulfilled promises of the welfare state and neo-liberalism (free market and consumer sovereignty). The PPPs in a way represent failures of the welfare state and neo-liberalism jointly. The implications are evident in the form of majoritarian appeasement, decline of social harmony and decay of public delivery systems. While these add to the non-traditional security concerns, the wider implications are threat to democracy itself. Collusions between the political establishments and few corporate entities has been found to lead to monopoly tendencies at one hand and destabilising democratic processes through post-truth campaigning, new ways of funding politics and elections and declining autonomy of constitutional bodies. The degrees of impact differ from one country to another depending upon the socio-political circumstances.
Domestically, the collusion leads to consolidation of power for certain populist or existing political entity whereas it has international implications as well. While the Trump Presidency will be remembered for the alleged Russian involvement in the presidential election, mutual campaigning by the ‘Howdy Modi’ and ‘Namaste Trump’ events remain unprecedented and unparallel in the history. In these instances, two heads of government appear to collude for consolidation of power but the collusion does not remain confined to the use of government machinery only. Many private players including NGOs (co-ordinating), think-tanks (conceptualisation and planning) and MNCs (funding) play their role in various ways and at different stages. The addition of social media to the list of actors involved makes the situation more troublesome as they influence political campaigning within and outside a certain country. Numerous instances can be presented to highlight such cases.
The foreign policies of nation states have been influenced by the interests of the MNCs for long. These interests have more or less been circumscribed within the national interests. But the emerging collusions between the political and corporate actors seem to have redefined and redrawn the contour of interests and possibility of influencing one nation state by the other. US President favouring his own company by economic policies and international agreements of his government presents one such example of collusions attempted to be hinted in the paper. Indian Prime Minister advertising for the products of select corporate entities and moulding international agreements to favour few entrepreneurs can be another example of such collusions. While formal and informal understanding and agreements between the state and economic agents (corporate entities for example) is not new, the forms and degrees of such understanding and their implications for human and national security present unprecedented and hitherto unknown circumstances.
