But we are past that point now. Small firms and middle-income households are getting squeezed on business credit and home loans. In political-economic terms, this means that the incumbent government, despite having presided over three years of great growth performance, will be associated with avoidable cost increases for households and small business. UPA strategists have been arguing that inflation loses more votes than growth wins. Since the Congress got urban votes in the last elections and since an increasingly urbanising India is carrying the burden of a strange monetarist orthodoxy, the Congress may find out how off-the--mark its theory is and how much it hurts electorally.
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