New Delhi: Remember the speech by Prime Minister Narendra Modi in the run-up to the 2024 general elections, where he warned his supporters that if the opposition won, the majority’s resources would be taken away and redistributed among those he described as people with more children and the so-called outsiders illegally entering India. When his audience still couldn’t identify the threat, Modi made it clear he was referring to the Muslim minority.

Now, this “us versus them”, the deserving in-group versus the “undeserving” out-group, is not unique to India. It is happening world over. Right-wing populism has been on the rise for the last decade. There is Marine Le Pen in France, Georgia Melony in Italy, Nigel Farage in the UK, Viktor Urban in Hungary, the AFD in Germany, and the US president, Donald Trump.

But there’s more in common between these leaders than just their rhetoric. It’s how they are redefining social protection and welfare. A new UN report titled "Right-Wing Populism and the Future of Social Protections" discusses exactly this. In this special interview for The Wire, Olivier De Schutter, the UN Special Rapporteur on extreme poverty and the author of the report, joins Alishan Jafri to discuss his findings.

Edited excerpt follows:

Why did you write this report on welfare and rightwing populism now?

Well, interestingly, the report started with an inquiry into what we call welfare dystopias. In other terms, the fact that welfare policies increasingly become a pretext for monitoring individuals, for surveying individuals, for ensuring that they comply with certain conditionalities. Really, the welfare state is developing into a punitive state that seeks to control individuals and makes access to social benefits conditional upon these individuals complying with certain requirements. And what I was struck by is the anger, the impatience, the distrust towards institutions that this was leading to. And I believe that this makes fertile ground for the rise of far-right populist parties that find people vulnerable because they have become economically insecure and they do not trust the mainstream political parties as a result.

But when we talk about globalisation, especially in the context of India, many feel that globalisation is important and the usual alternative that comes to people's mind to replace globalisation is a far-right populist leader. Isn’t it?

Well, globalisation has been fragilising people in many ways. It has, of course, led in many countries in the developing world to very high rates of growth. But it also has increased inequalities, and with inequalities comes a new sort of social anxiety. The fear of falling behind, the fear of being marginalised as others make progress around you. So growth stimulated by globalisation has led to widening inequalities and that is true for India as for many other countries. In India, it is well documented that whereas inequalities had been going down in the 1950s and 60s until the early 1980s, they began rising again in the 1980s and they skyrocketed since the early 2000s. And this is largely the result of the shift towards globalisation that started in the 1990s and that has continued ever since. So globalisation has brought about a number of benefits including overall economic growth, very impressive in India in the past 25 years, but at the same time people feel economically insecure. They fear they will fall behind and that leads politicians to present themselves as able to protect the population, able to respond to this social anxiety and that is how the far-right populists can gain their audiences.

When societies deglobalise to address globalisation-related anxiety, doesn’t this mostly result in protectionist, exclusionary policies?

Well, the reaction to globalisation has indeed been in many cases protectionism, which may take two forms. First, you have protectionism in trade relations. You raise import tariffs for example to protect certain sectors of the domestic economy from foreign competition. But the other form it takes is what I call in the report welfare chauvinism. In other terms, you make access to welfare conditional upon people belonging to the national community. You exclude from certain benefits those who are considered to be either foreigners or not to belong to the natives. And you present yourself as providing this protection only to part of the population, leading to a more polarized society. And that is what we see in a number of countries where increasingly welfare, rather than protecting all people universally who live within the country, is reserved to the natives and denied either to the undeserving poor or to those who are not considered natives in the country, and that is welfare chauvinism that we see in many countries is gaining ground.

Since a lot of these welfare policies and schemes are rolled out just before elections and are tied to one’s loyalty towards a leader or a party, how does it transform welfare? Do you see these other countries?

Well, yes indeed. Welfare in a rights-based approach should be granted as a legal entitlement to all people that fall below a certain poverty line or need the support of the state. But increasingly welfare is treated rather as a form of public charity from the government that may make access to welfare conditional upon complying with certain conditions or belonging to certain groups. In other terms, it becomes a privilege rather than a right and it is based on charity rather than on the idea that it's a legal entitlement. And in fact, increasingly what we see is that the tools that governments now have at their disposal allow them to make welfare thus conditional upon certain requirements being complied with so as to be reserved to the deserving poor or to certain parts of the population only. In India, for example, the so-called JAM [Jan Dhan, Aadhaar and Mobile] trinity includes owning a bank account, Jan-Dhan, having an Aadhaar identification number and having a mobile phone allowing it to be connected to the bank account. This is increasingly used to select the beneficiaries of welfare and to exclude those who are not considered to deserve support, and that is very problematic. It runs counter to the idea that welfare provision should go to all people without discrimination and is in the interest of society as a whole rather than only to those who enjoy those benefits.

You also talk about punitive welfare, where welfare is linked to somebody's ability to be employable. Can you describe how this punitive welfare is leading to the rise of the far right?

Well, this is a trend that covers or goes through many regions. Increasingly, welfare is provided on the condition that the individual proves that he or she is looking for work, searching for work and that he or she is going to accept employment that is suitable for that individual. And the idea is that rather than people being passive beneficiaries of welfare support, they should activate themselves to search for a job and to thereby be included. The idea of minimum government and maximum governance, that is part of the platform on which the BJP were elected in 2019, is really reflecting this idea. Minimum government means there will be less rights-based welfare in areas such as provision of public work, food or education. And maximum governance means that the individual will be monitored to make sure that he or she, through various apps, dashboards and digital systems such as Aadhaar, will be motivated to find work. So the idea is that welfare should not create passivity or dependence but instead should be made conditional upon people really looking for work. And one major problem here is that many people may lose their welfare entitlements if they refuse to take up a job that is not suitable for them, which sometimes is very problematic depending on the type of employment that is proposed to them.

But a counterargument that is often made against your argument is if the government keeps on giving what in India is called freebies or revdis, then they will not only lose resources but also people wouldn't want to work if they’ll get everything for free. 

Well, I think it's important to realise that the provision of social benefits is an investment. It's not a cost for the government. It's an investment in the sense that it will allow the households who are in need of public support to invest in the child's education, to invest in better nutrition and health care. These children who will be protected from poverty as a result of their parents being better supported will be more productive adults in later life. They will learn better and they will study further, a larger number of years, and therefore in the next seven, eight or ten years, the return on that kind of investment will be extremely high for the country concerned. Many studies show that investing in addressing childhood poverty in particular is the best investment a country can make. However, it's an investment, the return on which is only tangible after a number of years. But the argument that it is too costly to protect people in poverty from extreme destitution is an argument that is not backed up by good economics. On the contrary, economists are unanimous in saying that it is a sound investment with very high returns for society as a whole.

Why do you say that the billionaires need to be taxed more?

Well, that's the classic trickle-down economics idea which has been many times disproven as a myth. In fact, there are many studies including from the International Monetary Fund, the IMF, showing that inequalities are a constraint on growth, that more equal societies that spread wealth and income more equally are better equipped to deal with business cycles and to overcome economic crises. And that it is stimulating the economy to provide the middle class and the lower classes, the first deciles, with better wages and better social protection. So if you want to allow the economy to prosper, you should reduce inequalities, not increase them. And reducing inequalities means having highly progressive taxation schemes including by taxing the wealth of the ultra-rich.

When you say that the wealth of the ultra-rich should be taxed, it's something that's a very polarising debate both in the United States, and in India. 

Well, look, the levels of inequalities in India are becoming totally unsustainable. This is why scholars working on India speak now about the billionaire Raj, showing that India has now become more unequal than it was under the British Raj in the colonial period. In India, according to the latest figures we have, the 1% richest part of the population owned 40.1% of the wealth. And 22% of the national income went to this 1% of the richest part of the population. This is entirely unsustainable. It serves no useful purpose, it leads to resentment and it is something that is bad for the economy and for the social fabric, right for social cohesion. So I think that is the answer that should be given. 

The problem with the rise of inequalities, as have occurred in India over the past 30 years, is that it leads society to be increasingly polarised and scapegoating the Muslims or the Adivasi or the Dalit, as is done by certain politicians today, is only possible because people understand that inequalities are rising and they see therefore others as competitors for scarce resources. Things need not be so, it is quite possible given the rates of growth that India has benefited from, to reduce inequalities, to have robust social policies that protect people from extreme destitution, and again, that is beneficial not only to people in poverty but to society as a whole that will be much more appeased and much less polarised with such social policies in place.

What are these social policies if you can mention a few?

Look, India has a number of achievements. It can boast for example the Mahatma Gandhi National Rural Employment Guarantee Act, the right to education act of 2009, the National Food Security Act of 2013, which I worked on when the United Progressive Alliance was in power then. And more generally, India has started putting in place what it would take to become a modern welfare state. The problem is that since this period we've seen many regressions taking place, and in particular the expansion beyond Gujarat of the Gujarat model of low taxes on corporations, low spending on health and education, resulting in high levels of social economic deprivation for certain groups of the population, that is deeply problematic and I’m convinced India can do better.

I mean what are the alternatives that not just India, but all the countries that you mentioned in your report can take up or can implement to gradually bring about reforms and social protection.

We know what tools can be mobilised to break the vicious cycles that perpetuate poverty and maintain people in poverty. First and foremost, minimum wages that correspond to living wages allow the worker to support him or herself and his or her family. Secondly, adequate minimum income schemes for those who don't have a job and who nevertheless should be supported in order to avoid falling into extreme destitution. That is a protection that is essential for economic security. 

And finally, throughout the life cycle, the individual should be protected from the various risks, through child allowances, through unemployment benefits, through maternity benefits, through old age pension. All this of course needs to be financed. But it can be financed with progressive taxation schemes and by ensuring that whatever growth exists is more equally spread. So I think these are the recipes that all states are now encouraged to espouse. They are recommended by the ILO and they are part of the commitments made in 2015 with the adoption of the sustainable development goals. Now it's time to deliver.

At a time when you have somebody like Donald Trump in the United States, there's a tariff war going on, why would Indians not want a protectionist leader to protect their interests?

Let me be very clear. The protectionist policies, the neo-mercantilism of Donald Trump and his administration are completely unacceptable. They are really arm-twisting and they result in an abuse of power by the most powerful economic nation to force concessions upon many countries including India. And the way this power is used is simply not acceptable. That being said, I think it also shows the limits of a development model that is premised on exports. 

It is problematic that countries such as India and many others rely on exports to pursue their development process. That puts them at risk of facing such protectionist reactions which may interrupt their development process. And I very much hope that the current rise of protectionism throughout the world can be an opportunity to rethink how we pursue development. For me, development should be much more inward-looking, based on growing the incomes of the local population so that more people will consume what is locally produced and local production will be consumed locally. I think that is what we have to hope for in the next few years.

Yes, but wouldn't Indians want their government to be more protectionist and wouldn't they move towards a right-wing populist leader in that case because they would believe in his rhetoric in times of adversity.

Well, you are absolutely right. The idea that we should produce more for local needs to be satisfied and people should consume more of what is locally produced is neither an idea from the right nor from the left. It all depends how you do this. If you do this with xenophobic undertones and a nationalist agenda, then indeed it can become problematic. 

If instead, you do this in the spirit of reducing dependency on export to fuel local development and to increase the purchasing power of the poor in order to allow development to be based on that domestic demand rather than the demand from the high-value OECD markets, it becomes something very different. And there is indeed a progressive politics that can be more inward looking and that can be premised on the idea that we need to improve the wages of the low wage earners, improve social protection locally to allow people to buy what is locally produced rather than local producers having to export whatever goods or services they produce in order to have revenue. So I think the more inward-looking development process that now India will probably be forced to consider is an idea that is not to be reserved to the right-wing parties.

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