They examined countries with similar geographical, cultural and natural resources; for instance, North and South Korea, East and West Germany and several African countries to establish that, all things being equal, it is the nature of their institutions—specifically whether they are inclusive and governed with the national interest in mind or extractive, catering to a minuscule proportion of the rich and powerful—that is the most telling differentiator.
Every nation faces a choice of investing for the future or present. This is not just about funds, but where money is deployed. And it is not limited to funds either. The term ‘investment’ encompasses strategic efforts to occupy mindshare and strengthen nation-building elements like healthcare, education, research and development, social justice, wealth distribution and corruption-free systems. India’s record on these lead indicators is on a downtrend. Take, for example, the NEET furore.
Symptoms of our education system being in dire straits are evident, ranging from rigged exams, question paper leaks, paid proxies appearing in lieu of actual candidates, fly-by-night ed-tech companies and billions of rupees made by ‘coaching industries’ that fleece hopefuls battling near-impossible odds.
Our school education system has virtually abdicated its role to the tuition industry, stacking the odds against the poor. When it comes to NEET hopefuls, the difference between the cost of education at government colleges (that have approximately half the 100,000-odd seats) and at private deemed colleges is astronomical.
While the former is somewhat affordable at under ₹8 lakh, the cost of education in private colleges is upwards of a crore, reserving these seats exclusively for the top 1% of Indians. As if that weren’t enough, the latter are now encroaching into the 50,000-odd government seats that are still affordable by circumventing the exam itself. After all, it’s only the rich who can pay for leaked papers.
The rot didn’t start with this instance, which came to light more because of the ham-handed way it was conducted and protests by students, rather than any proactive audit by authorities, who remained in denial despite glaring evidence to the contrary. It had set in long ago.
Almost every exam conducted for government posts at central or state level, especially at lower echelons like for the appointment of teachers, constables, municipality workers and even peons, have massive over-applications with highly over-qualified aspirants desperate to get these posts.
The ‘rates’ for attaining these are well known, as is the nexus between private institutions, bureaucracy and politicians. Yet, the urban middle- and upper-middle class remained unconcerned because that rot did not affect them directly. NEET does.
The irony is that regardless of the position of an undeserving candidate, the gangrene doesn’t stop with one part. It spreads across the system, spoiling everything it touches. Bridges fall because of incapable engineers and dishonest officials. Soldiers die because of substandard equipment.
Billions of man-hours are lost to annual waterlogging due to incompetence and corruption. Accidents rise because driving licences can be bought. A constable who paid his way to become one begins illegitimate recoveries as soon as he does. And doctors who bought their way through medical colleges could end up killing patients with licensed impunity.
Every investment made in the future, be it the small savings of a household in a mutual fund, massive stock-market infusions by foreign institutions or even bonds issued by the government, is essentially an investment in the quality and strength of the institutions that govern us directly or indirectly.
Nations succeed or fail because its citizens recognize the umbilical link between good institutions and their future success. Inclusive institutions leverage the entire national capacity and do not hamstring the majority of people with uneven playing fields. Extractive institutions focus on a specific demographic slice for short-term gains.
Inclusive institutions are unbiased, fiercely independent and beyond reproach, capable of producing meritorious policemen, engineers, drivers, government servants and doctors. Extractive institutions are opaque, mired in controversies and scams, spewing substandard material.
Inclusive institutions ensure political power is distributed with checks and balances, fostering participative economic and educational policies that enable equitable wealth creation. Extractive institutions concentrate disproportionate power and resources in the hands of a few.
But most of all, nations succeed or fail because they realize the difference between cosmetic assuagement, headline management and blame shifting, and actually fixing the root cause of the problem, which is the nature and quality of the institutions. Until that happens, we’ll keep taking the patient to a beauty parlour instead of a hospital, because the focus is on making the patient look good, not curing the disease.