In The Wordly Philosophers, Robert Heilbroner said while describing economists, “...[F]ew of them ever lifted a finger in action; they worked, in the main, as scholars – quietly, inconspicuously...they buttressed and undermined political regimes; they set class against class and even nation against nation – not because they plotted mischief, but because of...their ideas.”
You can see this in action through Kaushik Basu’s memoir Policymaker’s Journal: From New Delhi to Washington, DC. The book is the revised version of a diary that Basu maintained during his time as Chief Economic Advisor to the Government of India – from 2009 to 2012 – and then as Chief Economist, World Bank – from 2012 to 2016.
This diary was much anticipated. In his previous book, An Economist in the Real World: The Art of Policymaking in India (2015), Basu wrote that his diary had “‘revelations’ and notes on personalities”, and was battling ethical issues over to publish it or not. But while the book is entertaining, filled with trivia and offers a bird’s eye view of top-level policymaking, there aren’t as many “juicy anecdotes” as anticipated.
To be sure, there are insights and stories, but they are built on the trope of bureaucracy and policymaking, which are often known. However, it is nice to read them from the point of view of someone who has seen it from the top.
The book is the academic version of a James Bond movie or an episode of Night Manager which cuts to a new exotic location after every few minutes. Except here, instead of life-threatening missions, the protagonist is often seen dining with heads of states, delivering lectures and engaging in diplomacy and policymaking.
Early on, Basu clarifies this isn’t a book on economics. He takes you through the uppermost echelons of policymaking, where he is preparing Economic Surveys, policy documents, coordinating research, and even causing the Sensex to rise because of some offhand statements.
Basu, who was a Professor of Economics at Cornell University, got a call from the Prime Minister’s Office out of the blue and was offered the CEA’s post. Having had no experience of working in the government, he was surprised but also delighted.
The CEA heads the Indian Economic Services cadre and is responsible for the Economic Survey. Basu admits that his motivation for being an economist wasn’t to help the world but to take a stab at solving very complex problems. But he saw this as an opportunity to do some good.
This outsider’s view sets the tone for the book. Basu lampoons the officiousness in governance, the culture of seeking permission for everything and the reluctance to try creative ideas. He acknowledges that a lot of bureaucrats are extremely competent, but being a part of the government for so long takes away from creativity.
Basu was once chided for presenting a report in four chapters when others had used only three. he reveals other quaint aspects of protocol, – once, his office staff had to determinedly ensure there was a separate towel for the CEA, as the bathrooms had towels for different ranks.
Basu’s interactions are studded with encounters with some of the most famous economists and academics. But, of course, he found the world of policy to be starkly different from academic life. Policy suffers because it is hinged on political consensus and requires invoking a vertical hierarchy for everything. By the end of his stint as the CEA, Basu feels, he became adept at the skill of speaking a lot but not saying anything – after all, a bureaucrat cannot ever admit to not having an answer.
Surprisingly, he says that policymaking is often “groping in the dark”. Often no one knows what will work and what will not. If it works well, then it’s because of you. If it doesn’t, then external forces are responsible.
Throughout the book it becomes clear that Basu holds Manmohan Singh in high regard, attributing India’s highest growth years to Singh being at the helm. Amongst others who find positive mentions are Amartya Sen, Pranab Mukherjee, Rahul Gandhi, and Sonia Gandhi. He found the quality of discussions during his time to be high, with an environment that encouraged deliberations. This seems to be lacking in the current policymaking structure, as he has said in recent interviews.
Since Basu’s sojourn as the CEA corresponds to some big corruption scandals – such as 2G and Coalgate, to name two, he clarifies several times that he never actually witnessed examples of corrupt practices. Often, he writes, he was viewed as an “outsider” to politics, which made ministers wary of discussing many things in his process. He also cherishes the role of Indian media, in keeping the powers in check.
The World Bank and after
As Basu moves to his time as Chief Economist at the World Bank, the notes are fewer in number, but in some aspects, they become deeper. He talks about his visits to various countries, the challenges he faced and the things he learnt. The entries also becomes more diverse as he is a part of an international organisation now. He recounts how he implored Barack Obama to remind Narendra Modi of the value of inclusivity and diversity, which Basu says he also conveyed to Modi personally when he met him in 2015.
Basu is self-aware and often critical of the institutions he is a part of. He acknowledges the ills of the World Bank, and brings in some changes to focus on eradicating extreme poverty. He is driven by the example of Joseph Stiglitiz, who criticised the IMF and the World Bank for being too conservative while he was the the Chief Economist of the World Bank.
Basu is occasionally vain, but he also laughs at himself. Once, someone called him the Shahrukh Khan of academics, to which he couldn’t help nodding. He says that he is instinctively left-wing. The idea of a society that Marx wanted appeals to him. But he disagrees with many activists and economists on letting emotion dictate their thoughts. His emphasis on logic is strong. He says he isn’t affected too much by the outside world because he considers everything to be pre-determined. Even the ability to work hard is based on someone’s circumstances. Also, he doesn’t feel guilt.
Often, when Basu talks about the poor, the tone seems to border on fetishisation. He always ascribes to them an innocence, honesty and simplicity that reeks of a saviour complex. There is also a tinge of casual sexism when quips that his BBC column became wildly popular because Preity Zinta’s column was placed next to his.
What economists do
George Orwell said, “Autobiography is only to be trusted when it reveals something disgraceful...”. There aren’t any such disgraces in this book. However, since this is a diary that Basu claims to be publishing with only minor clarifications and very few omissions, we can overlook this aspect.
What does emerge clearly is the role of economists and their impact. Keynes once said, “Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler...” Basu demonstrates both the seriousness and the ludicrousness in this.
Like when deregulating petroleum, he felt this “decision” taken in a room by a few people could impact millions of lives, but he recounts that Amartya Sen once told him of a Central Bank Governor who agreed to increase the repo rate by one per cent after a conversation with an Economics Nobel Laureate who had no clue what a repo rate is.
The book also gives a sense of how policymaking in India has also changed over the years. Themes like crony capitalism, corruption, and poor economic performance, which he was wary of then, are playing out now. For its reference to all these elements alone, this book must be read.
Umang Poddar is an editorial head at Lawctopus, and a lawyer. He is here on Twitter.
Policymaker’s Journal: From New Delhi to Washington DC, Kaushik Basu, Simon & Schuster India.