In India’s politics, to be anti-rich is usually considered safely synonymous for being pro-poor. It is tough to do something that will make a real difference to the lives so many poor persons that can swing an election your way. But “compensating” them with cheap thrills by seemingly hurting the rich is an easier alternative and it has been successfully used by “socialist” rogue regimes the world over, particularly by many of the really bad guys in Africa and Latin America after some of whom we have named our main streets. But if this is what the Congress is trying to do, dazzled by the lofty talk of its jholawala fellow travellers and driven by desperate pleas of its Rajya Sabha coterie to hang on to the logic of 2004 to win as the incumbent in 2009, it’s getting its politics all wrong. It is showing in its electoral performances. It is failing to see that as India has grown, that growth has changed the definitions of rich, middle class and poor, aam aadmi and farmer, urban and rural. And if a centrist party, at least one that seeks votes across states and regions, fails to see that, it is walking into disaster.

Confused politics produces confused economics as well. So while on the one hand it goes after inflation with a sledge-hammer, it is actually, mostly, hurting the very aam aadmi it swears by. In this mad dash to “moderate” inflation, it has allowed interest rates to go up nearly 400 basis points for ordinary aam aadmi home loan borrowers. Because of the way banks structure these things, they will only now realise the implications of this when their annual loan statements come. Banks usually do not increase your EMI. They only increase the tenure of the loan. And that increase can be quite dramatic. For example, if you borrowed for that tiny flat at the age of 28, at 8 per cent, be prepared to keep paying back till 84, if the rate goes to 10 per cent and increases a 20-year tenure dramatically to 56 years and two months.

... contd.