Consider the following, progressively complex hypothetical scenarios:
Scenario 1 : Spend on national defense first and job creation second IF the country is facing security threats. All right, that is probably easy enough to agree on.
Scenario 2 : But what if the security threat is probable but not imminent? Which do you spend on first? Depends on what the probability of the threat is perceived to be. If the threat is very likely to materialise, well then we would all agree that dealing with the security issue first is a good idea.
Scenario 3 : But what if the security threat is now lower (though not entirely absent) but now the economy is in danger – i.e. the current situation in the United States? What if any further expenditure on militaristic activities comes at the cost of reducing resources available for fixing other parts of the economy? How should a trade off be accomplished when you have two simultaneously problematic aspects that need to be addressed?
The thing is, extreme one-time catastrophic threats to national prosperity and security - war and famine – are less common than chronic, lower-level conditions – economic inequality, poverty, education gaps, persistent security concerns (like border security, gender disparities, public health and so on.
Just because a problem is not a catastrophe does not make it trivial. For example, left unresolved, a minor gap between the rich and the poor today can become the cause of massive socioeconomic instability tomorrow. So no, these are not trivial concerns but these are different in being persistent, ongoing concerns that CANNOT be solved overnight. These problems necessitate deep changes in the institutions of society, governance and service delivery; institutional changes that need to be thoughtfully carried out because a change in one sector can have consequences for another sector.
This is where the problem of sequencing becomes a difficult one, and this is why policymaking would be difficult even in the absence of petty, partisan politics.
Efficient & Equitable Development - Why Sequencing of Policy Reforms Matters.
This section explains – quite briefly! – how sequencing might be an important thing to consider for planning development measures. Now the problem of development is a cross-sector one. Social, political and economic issues and institutions are inter-related and it is difficult to go too far in the reform of one without considering reform in the other.
Take the case of creating local governments and giving them greater autonomy – decentralization. It is often argued that giving more power to the local level can encourage more citizen participation in politics, allow for greater accountability of public officials…. quite simply, bring the government closer to the people along with all the advantages that closeness provides.
Yet is targeting the level of government enough to create more accountability in the governance system? Do we need no additional investment into ensuring that local citizens become informed voters and effective political participants? Can we take that as a given?
The answer is an emphatic NO, especially in developing countries. A lot needs to be done before people can bring their local public officials to task. Education matters. Levels of information matter. Well-functioning judicial systems matter. A free news media matters. And many economic considerations also matter.
Countries with corruption
Take the example of countries with high levels of corruption. Case in point: India. Here, local governments are very susceptible to undue influence by local elites; local elites can bribe off local public authorities to their mutual advantage, and infiltrate the local governance system in many ways. An underlying problem here is that because of vast gaps in wealth (and hence 'power & privilege') between the different social classes at the local level, corruption cannot be made to go away that easily. After all, who is to prosecute the corrupt government officials?So no matter what sector the policy reform concerns, fixing the underlying problem of power disparities might be a good idea since that can give the "common man" a bigger voice in the political / governance process, and enable these reforms to actually occur on ground... not just on paper. Appropriate sequencing in this case would consider the point above. Policy makers would be wiser then to address the underlying problem before conjuring up a whole host of complex policy reforms.
Agriculture based economies:
Land ownership inequality and Political reform
Inequality of land ownership is one of the biggest problems in the more unequal developing countries (the Latin American countries come to mind, as does India)... This is especially problematic because agriculture is the mainstay of the economy in many developing countries which means that farming is what puts the bread on the table for most families. If you don't have land, you can't farm. You can work on someone else's farm, but then you are beholden to them in many ways, much of which is unregulated.
The story of land ownership, tenancy relations and the social privileges that come with owning land is a story for another day. In this case, suffice to say that when you don't have land and you belong to a rural family in a developing country, you are usually economically dependent on the landholders in your locality.
That economic power translates into political power goes without saying, and we all know this to be true in the developed world as well. The problem in the developing world is as follows.
- Suppose you are a landless farmer working on the farmland of some big landlord in your village.
- The national government decides to embark upon extensive land policy reforms to help out landless farmers such as yourself... a redistributive policy that aims to take some portion of land from these elite landholders and redistribute it among the landless.
- At the same time, the government also decides that it is going to empower the rural citizens of the country and give them a voice in the political process by creating a multitude of village-level governments, and giving them a number of administrative and fiscal powers.
- The Chicken & Egg Conundrum : Do you see the logical outcome of this flawed measure? The landless multitude cannot participate in the politics of their local governments because they are too economically dependent on the landed class to go against them. Yet by not participating in politics they are perpetuating the unfair, historically grounded system that is keeping them poor and landless .... instead of exploiting their local governments to change the economic system.
- Question : What does one do here?
- Answer : Sequencing.
A quick example comes from India’s rural policy reforms. The Indian state of West Bengal - a socialist (communist to be more accurate) bastion - has been generally considered successful from the point of view of strong political participation in local governments, even by poorer households and even by poorer households in the rural parts of the state. This is certainly a noteworthy achievement by Indian standards, or by those of many other developing countries where the rural poor are very likely to be politically disenfranchised. What policy strategy was used in this case?
Well, the biggest factor here was that state land reforms preceded national policies for establishing an extensive village government system. By the time village-level decentralization measures were implemented, the state government had addressed the power inequalities within villages that arose from the economic inequalities associated with being a landholder or being a landless tenant.
This allowed the previously landless a stronger voice in village politics**.
(**Reference: Bardhan, P. 2002. Decentralization of government and development. The Journal of Economic Perspectives, 16(4): 185 – 205)
Is attention to sequencing always the best way to go ??In theory, yes. But in practice? Not always feasible, but if attended to as far as possible, will yield good results. Creating social and economic conditions conducive to the implementation of policy reforms before actually doing those reforms sounds obvious to the point of being trivial, right? Not so!! What it necessitates is careful attention to the underlying social and economic dynamics that might prevent desired outcomes of those reforms.... in other words, it necessitates careful research regarding what those conducive conditions are. Once that is figured out, it would be appropriate to tackle that at least a little bit prior to a full-fledged implementation of the primary policy.Does this happen often? Unfortunately not. It is usually only after a policy has been put into practice and fails to measure up that policy makers launch an investigation into why things did not work.
Much of policy making is still very much done in a trial and error fashion.... there is nothing wrong with trial and error of course.... even sequencing would have to proceed in a trial and error, step-by-step manner. What is advocated here is a systematic approach... why not really map out a trail to the outcome, and steadily go toward a policy goal? It will be a stepwise process, an incremental process.... but we might have a better chance to actually getting to where we want to go in a far more cost effective manner.