Ever so often
public ire in Goa turns against the Goan taxi-drivers who are seen, at least by
certain dominant sections, as the
single group that is upsetting the order in Goa. The taxistas, and in
particular the taxistas of Salcete, have been accused of refusing to accede to
a regime of digital meters and proper fare charts, charging exorbitant amounts
in the absence of these standards. Additionally, if the clients ask for details
of the fare calculation, they are allegedly often abused or threatened. These
men are seen as uncouth, unreasonable, prone to violent protest. A number of concerned voices were recently
raised when the taxi drivers blocked the entry of the transportation network
companies, like Uber and Ola, into the local market. These voices pointed out
that such behaviour was in fact enforcing a monopoly, and thanks to the uncouth
and violent behaviour of the taxistas would in fact result that a tourist’s
first impression of Goa was a negative one. This could only result in the decline of tourists to Goa
and the killing of one of the most lucrative industries that the state enjoys.
In this column I
will not justify as much as frame their actions in a different light. First, I
will try to suggest that their actions are not, in fact, different from many
players in the Goan economy, and secondly, that their actions may in fact be
beneficial to our larger interests.
In economics and
in public-choice theory, the kind of behaviour ascribed to the taxistas is
described as ‘rent-seeking’;
which involves seeking to increase one's share of existing wealth without
creating new wealth. To understand this term we need to distinguish it from the
understanding of profit-seeking behaviour. Profit results from the extraction
of value when two parties engaging in mutually beneficial transactions. While
the party paying the profit may grumble about the price for the commodity, s/he
still engages in the transaction because the gain is still more than the value
extracted as profit by the vendor. In the case of rent-seeking behaviour,
however, one is manipulating the social or political environment in which
economic activities occur, rather than creating new wealth. A classic example
provided for rent-seeking behaviour is that of the feudal lord who installs a
chain across a river and then hires a collector to charge passing boats a fee
to lower the chain. There is nothing productive about the chain or the
collector. The lord has made no improvements to the river and is helping nobody
in any way, directly or indirectly, except himself. All he is doing is finding
a way to make money from something that used to be free. Another example of
rent-seeking behaviour, and this one would be closer to what the taxistas of
Goa are engaging in, is to gain a coercive monopoly to enjoy advantages in the
market while imposing disadvantages on other competitors. Rent-seeking results imperils
the economy because it results in reduced economic efficiency through poor
allocation of resources, reduced actual wealth creation, lost government
revenue, increased income inequality, thus potential all-round decline of the
economy.
As upsetting as
the taxistas actions may be, are they the only sector of the Goan economy who
behave in this way? Critics of the mining sector in Goa would argue that mining
in Goa is also based on rent-seeking. The miners are known to cheat on the
payment of taxes, depriving the exchequer valuable funds through which income
could be invested in public infrastructure. This critique is most strongly made
by the members of the Goenchi Mati Movement,
who now demand changes in the way that mining in Goa is run so that
rent-seeking behaviour can shift to profit-seeking behaviour, and the profit
can be spread more equitably across society and across generations.
A similar
inquiry could also be levelled against the tourism industry; are the many
shacks, hotels, and more recently casinos, engaging in value addition, or are
they merely skimming of the natural beauty of Goa, and the captive markets that
they have thus far enjoyed? The behaviour of political leaders who allegedly use
their office as a way to extract money from the entire system is similarly
rent-seeking. It is reported that for a sum, politicians intervene to give
people jobs. They are also known to use their location to ensure kickbacks and
gain huge profits, which are then invested in real estate – which is in fact a
destruction of productive fields, and a destruction of the ecological order. Indeed,
the rent-seeking nature of the actors in the Goan economy is pretty much the
focus of Raghuraman Trichur’s book Refiguring Goa.
If rent-seeking
is a feature of practically the entire Goan economy, why is it that it is only
the taxistas who bear the brunt of seemingly unanimous condemnation? Is it
because they are largely former tenants who in earlier times would bear the
brunt of the rent-seeking behaviour of their landlords? Indeed, one could argue
that the violent responses of the taxistas of Salcete is the result of the
centuries of brutally unequal relations that have marked that territory.
But it is not
like the taxistas of Goa are the only ones protesting the transportation
network companies. Since at least 2014 taxi
drivers across Europe have protested
against the entry of the global transportation network company Uber. They make
valid claims that companies like Uber make money out of the fact that there is
as yet no regulation covering them, while the
taxi drivers are covered by a variety of legislation. Transportation
network companies are in this respect not dissimilar to the plethora of other
companies, for example, online marketplace and hospitality services like Airbnb, who also operate
without the burden of the regulations that govern the hospitality industry.
While these new
age companies operate under the façade of such terms as “shared economy”, in
truth they are the
vanguard of the neo-liberal economy that thrives on destroying public
infrastructure and institutions, and then extracting rent from the helpless
consumer. One need only look at the surge pricing that transportation network
companies extract. While these companies initially enter the market with lower
prices, and undercut regular taxi services, when there is an increased demand
they jack up their prices astronomically. All of this while the
company does not provide security to the drivers who associate with the
company. This is, to be sure, the future of transportation network companies.
They are not here to help, there are here to exploit.
To this extent,
as much as the actions of the Goan taxistas are problematic, they are no
different from the actions of the rest of the economy. Further, to the extent
that they have blocked some neo-liberal players from entering the economy, they
may in fact be doing us a service in that they are delaying the final assault
of neo-liberalism on our economies.
(A
version of this post was first
published in the O Heraldo on 4 April 2017)
