Business, Economics and Jobs

Just how rich are India's politicians?


Supporters of Mayawati Kumari, Bahujan Samaj Party (BSP) President and former Chief Minister of Uttar Pradesh state, listen to her speech during a political rally on April 6, 2009 in Palwal, India. Mayawati has since come under scrutiny for possessing "disproportionate assets," based on her official government income. However, some argue that her wealth garners more attention than that of other politicians because she is a Dalit -- the modern name for those castes once classified as untouchable.


Daniel Berehulak

As usual, the Wall Street Journal's Rupa Subramanya hits on a compelling question for Indian society: How rich, really, are the country's politicians? 

If corruption is really as pervasive as Anna Hazare and company suggest, India's pols should be much wealthier than the average Joe.  And they should get even richer after they come to power.  But though we can put a check in both those boxes, Subramanya pulls together some new research to add some complexity to the story.

To begin with, it turns out that candidates that win elections don't amass all that much more wealth than the folks they defeat.

In an as yet unpublished study, "economists Ray Fisman, Florian Schulz and Vikrant Vig found that candidates who successfully ran for a seat in the state assembly (both backbenchers and ministers) did only slightly better in terms of asset accumulation than the candidates they defeated," Subramanya writes.

The difference amounts to about six percentage points. But if you eliminate cabinet ministers and compare garden variety legislators, even that disappears. The real story is that cabinet ministers amassed wealth 15 percentage points higher than their nearest rivals, suggesting that it's not enough to be a politician. You have to be a decision maker.

Fair enough. But is it an escalating scale? Do state chief ministers amass wealth faster than their cabinet ministers? How does the accumulation rate of state leaders compare with federal members of parliament? Can the chief minister of a big state amass more wealth than the prime minister of the country?

All of those questions are beyond the scope of the study, and, appropriately, also beyond the scope of Subramanya's excellent synthesis of its findings. But the news peg she chooses -- a long-running "disproportionate assets" case against former Uttar Pradesh chief minister Mayawati Kumari, which has gained momentum since her ouster in the recent state elections -- throws up these questions and more.

Mayawati has been the target of corruption allegations for the better part of a decade, and the increase in her wealth along with her political rise does indeed seem dubious. But the question is not only whether it is possible that she's as savvy an investor as Warren Buffett (or perhaps many times more clever). The question that also must be asked is why she, virtually alone among India's wealthy politicians, has drawn so much media attention and been targeted by such a sustained attempt at prosecution.

One can make the argument that her flamboyant birthday parties drew the additional attention. Or that her background as a humble school teacher, as opposed to the business background of a politician like Home Minister P. Chidambaram, makes it less believable that she might have multiplied her assets through legitimate activities.  But one cannot escape the feeling that her caste has played a role, as well.

Hailing from one of the castes once known as untouchable, now collectively called Dalits, Mayawati has used an imperious, diva-like personality and profligate spending to garner support from her oppressed constituency.  She's known by the unflattering nickname of "the Dalit Queen," and many argue that she hasn't really improved the lot of the Dalits -- though that is debatable. But nobody denies that the Bahujan Samaj Party (BSP) leader has increased their pride.  Every time she took an upper caste politician to task or appeared in public with a mammoth necklace of 500 rupee notes (one of her common birthday party rites), Dalits were reminded that they could be just as powerful, just as rich, and maybe even just as ruthless as the people who'd beaten them down for a couple thousand years.

Did that make it even more important for the members of the traditional elite to tear her down -- consciously or not?

A recent editorial by the national spokesman for the Janata Dal (United) Party suggests that the answer may be yes.  Because it turns out she's not alone.

"It’s a pattern: those framed in sting operations and pilloried for corruption mostly belong to the backward castes," Shivanand Tiwari writes in the Indian Express. "And hospitals and parks are built in the name of those who are really corrupt."

That's a tad heavy on the rhetoric. But Tiwari backs up his point with a number of specific examples.

Leaving Mayawati aside, recently the Bharatiya Janata Party's (BJP) Bangaru Laxman -- the first Dalit to be elected president of one of the party's state units -- was blasted for corruption, convicted and sentenced to the maximum penalty. The crime in question? He stole around $4,000. (Please note that the 2G telecom spectrum scam, where Andimuthu Raja, another lower caste politician, is the main accused, allegedly involves losses of some $35 billion).

Another case was formed and vigorously pursued against K.G. Balakrishnan, India's first Dalit chief justice, Tiwari points out. But no further action has been taken on allegations by crusader-advocate Prashant Bhushan that eight of the country's 16 chief justices are corrupt.

Maybe it is time to prosecute Mayawati for her alleged transgressions.  But maybe it's time to widen the net, as well.