In popular political discourse, it is important that politicians quote statistics that highlight their achievements. From Obama to Sonia Gandhi, political leaders of all creeds follow this simple recipe. After all, in electoral democracy, we do want to reward governments that serve the basic needs of the people and guide them to social and economic emancipation. Yet, an essential drawback of such mind-set “to cash in on success” is to develop a paradigm where essential pockets of our society fail to find voice in the system.
These pockets mostly constitute people whose lives remain unmeasured through our statistics, whose freedoms remain unquantified through our indicators and whose scopes remain unaddressed through our policies. Furthermore, the political dynamics within the nation can reach such state that no critical actors (for instance, political parties or media) will have any incentive to provide voice to such constituents. These citizens, slowly and over time, evolve into the “invisible people” of our society. This remains the fundamental political economy challenge of development.
In order to illustrate the basic argument, let us revisit our development journey. First, there is no doubt that Bangladesh has achieved a notable reduction in poverty from 1991 to 2010 as depicted in the long-term poverty trend.
More specifically, the figure highlights that head count rates under the national poverty line has fallen by nearly 50% between the noted time intervals and a substantial decrease has occurred from 2005 to 2010. Second, sustained economic growth over the last two decades is argued to have triggered such achievement.
Nonetheless, a crucial issue that has received little mentioning within both the development and political discourse is the increasing state of economic inequality in Bangladesh. To be precise, the top ten percent households of the income distribution generate more than 35% of the country’s income in 2010. In fact, if we consider the economic role of the top 20%, it is evident that they account for more than 50 percent of the country’s income while the bottom 50% account for less than 20% of the country’s income. This is a dire scenario and both policymakers and academic community have systematically ignored it.
In light of the preceding statement, questions that emerge as pivotal are: How can such economic disparity prevail within a democratic political landscape? Surely the masses “in the middle” will have any incentive for advocating redistributive policies by demanding greater tax contribution from the affluent segments of our society? As illustrated in table titled “Income tax as a percentage of GDP,” a contrary picture is evident since total income taxes in Bangladesh amount to less than 2.5% of GDP in 2012. This is also remarkably low if we compare our performance with India.
Besides, an acute governance scenario is visible if we remind ourselves that top ten percent households of the income distribution generate more than 35% of the country’s income. What is indeed more amusing then is the fact that less than 1.5% of the population have undertaken income tax assessment.
Collectively, these facts raise some more pertinent issues: A) Why are the affluent class contributing so little to our state? B) Is it because the state has minimum capacities to extract taxes? C) Is there collusion between political forces, media and the upper middle and affluent class (constituting the top 20%) which has effectively captured most state policies?
If truth is self-evident in the last question, then surely the “invisible people” constituting roughly the bottom 100 million need to revisit our notion of state and politics, which promises to provide them “bare minimum” services and create in the process a myth about its commitment to human development, as long as the bottom 80% turn up every five year to vote and offer the ruling elites the legitimacy to govern.
To conclude, 18th century Scottish political philosopher Adam Smith, noted elegantly in his work The Theory of Moral Sentiments that: “What is the end of avarice and ambition, of the pursuit of wealth, of power, and pre-eminence? Is it to supply the necessities of nature? The wages of the meanest labour can supply them why should those who have been educated in the higher ranks of life, regard it as worse than death, to be reduced to live, even without labour, upon the same simple fare with him, to dwell under the same lowly roof, and to be clothed in the same humble attire?. To be observed, to be attended, to be taken notice of with sympathy, complacency, and approbation, are all the advantages which we can propose to derive from it. It is the vanity, not the ease, or the pleasure, which interests us”
Thus, if such perspective on human motivation holds true, then surely the bottom 100 million people of our society have enough reasons to display grievance, since the failings or deficiencies of the state in carving out a path for inclusive development is absent not due to scarcity of resources. Rather, it is the unholy collusion and political nexus between the actors within the top 20%, which has made 100 million souls invisible in their own land.