Misleading people about the fiscal situation is one of the principal goals of political communication. The new Chief Minister of Tamil Nadu, moments after taking the oath of office, has begun complaining about the state's fiscal situation.
The Government has borrowed more than ₹10 lakh crores and has completely emptied, wiped out, scraped the treasury clean. They have left a burden to us that is impossible to carry. It is in this sort of situation that we have taken up this responsibility. You may immediately think, "This person is talking nonsense." There is nothing like that. Only if you go inside and check will you be able to tell: what is there, what is not there, what is in what condition, what is not in what condition." [The crowd cheers] So, I'll go look at all of that and give you a white paper."
In the same speech, he asked for patience from the electorate as he tries to implement his manifesto promises, which include enormous spending commitments that will increase the deficit. The Chief Minister has also authorised, on his first day, additional spending which will be difficult to reverse, such as free electricity up to 200 units. It is unserious to sanction subsidies and say you don't know the condition of the public finances on the same day.
The Chief Minister is making an almost cliched political move.
In 2024, the UK Labour party made this move, when they came to power by promising not to raise taxes. Once they came to power, they jettisoned this manifesto commitment by claiming that the Conservatives had left a £22bn black hole in the budget. This was an attempt at misleading the public about the fiscal position (which the Conservatives had also been guilty of).
In mature constitutional democracies such as the United Kingdom, there are also strong institutions, such as Office of Budget Responsibility (OBR) and strong civil society institutions like the Institute for Fiscal Studies (IFS) who lead the public conversation on issues of taxation and government spending, carefully analyse the situation, and speak fiercely and independently in defence of the public finances. This means that governments are held to account, and pay a greater political cost for unseriousness.
We need such institutions and organisations in India, for every state and every major city in India. We do not have such institutions, which impose political costs on people who make misleading statements. It's worth thinking about how to start building them.
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