Summary
Jagdish Bhagwati distinguishes between Nehru's and Indira Gandhi's approaches to state ownership. He notes Nehru's own admission in The Discovery of India that his inclination was to be a dictator, and links this to a cultural tendency to accept authority that liberals must challenge by insisting the market be allowed to work. Bhagwati characterises Nehru as a moderate Fabian socialist and "slowpoke" who never actually called for nationalisation; instead his policy sought to enlarge the public sector gradually by raising its share of investment, so that over a long horizon public means of production would asymptotically come to dominate the private sector.
Bhagwati contends that the serious damage to the system came not from Nehru but from his daughter Indira Gandhi, whom he judges neither a socialist by conviction nor an intellectual. He argues she turned to nationalisation strategically, to defeat the Congress syndicate, and, finding that it delivered power, adopted socialism as a purely strategic pose rather than out of belief.
Key points
- Nehru admitted in The Discovery of India an inclination to be a dictator that he resisted.
- Bhagwati sees a cultural tendency to accept authority that liberalism must counter by letting the market work.
- Under Nehru, nationalisation was not a major thrust; policy favoured gradually raising the public sector's investment share.
- This gradualist approach aimed to let public means of production dominate the private sector only over a long period.
- Bhagwati calls Nehru a moderate Fabian socialist and 'slowpoke' who never actually demanded nationalisation.
- He attributes the real damage from nationalisation to Indira Gandhi rather than Nehru.
- Indira Gandhi embraced nationalisation strategically to fight the Congress syndicate and adopted socialism for power, not conviction.
Transcript
Jagdish Bhagwati on Nehru, Indira Gandhi and Nationalisation
Source: https://www.youtube.com/watch?v=Zokl5XHy-NI Duration: 160.1s
Speaker 1 (00:00): He said once that, you know, my inclination is to be a dictator but I shouldn’t be. He says that in the discovery of India. And you know, when you’re in a position like Prime Minister there, you’re inclined to be a dictator, right? Because look at what’s going on now.
Speaker 2 (00:24): People just accept.
Speaker 1 (00:26): People are afraid to even after the decimation of the Congress party, they’re all going Sahasrang Pranam before the same people who lost. So there is a certain tendency in the culture to accept authority. I mean that is what one has to challenge by saying, Marker should be allowed to work. Early on under Prime Minister Nehru, Nationalization was not a big thing. I mean, the industrial policy at that time was still in the direction of not nationalizing and increasing the, yeah, but that was to be achieved by increasing the share of public sector investment. So investment means addition to capital stock. So if over time you add more and more capital stock in the public sector, that will begin to dominate the private sector. So asymptotically over a long period you will achieve a higher ratio
Speaker 2 (01:31): of public to private sector means of production.
Speaker 1 (01:36): So it was a gradualist approach over time. But Panditji never really said we should nationalize anything. So he was also, we might say, a slowpoke. You know, I mean, he was a Fabian socialist, moderate, and so on. So I don’t think that the one who really damaged his system through nationality was his daughter, Indira Gandhi,
Speaker 2 (01:59): who, again, was not really a socialist by conviction.
Speaker 1 (02:05): I don’t know what her conviction was. But to fight the syndicate, she started nationality. and it worked so well that she then became a socialist purely strategically. I don’t think, I mean she hadn’t read a thing in my opinion I mean you know she didn’t even finish her degree at all so so you know she was not an intellectual but she was a strategic actress you know on the scene and she thought nationalization, socialization, ownership of means of reduction Socialists, all of these worked to give her power.
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