Regulating The Monopoly Of New Class


In the evolving pattern of Nepal’s progress, not many issues have occupied a callous account than the birth of a new class. Class refers to categories of persons of the society based on the ownership of economic and political resources and the social and cultural arrangements that shape their worldview, thinking and conduct. The traits of this new class are: nouveau riche, willfully holds no interest in production and collaboration with people and fabulous display of wealth, status, authority and articulation against the other classes, and believes in the bureaucratically organised political and economic progress divorced from the condition of majority of people.

By virtue of its clout in the state’s writ, it is in control of political life, public policy and public good rendering the laws of the land almost feeble. Economic stagnation dents the quality of democracy and an array of transformation thus draining the lustre of Nepal’s inclusive democracy’s authority and efficacy of its ability to create a level playing field. The key problem of Nepali polity is its domination by a coalition of this new class. The incorporation of social democratic, right and left elites into the upper echelons of state power, civil society, industry, finance, commerce, health and educational institutions and their adaptation to the rituals of patricians have insulated them from the world of ordinary Nepali peasants and workers. 

Stealing of public money 

Economic historian Mahesh C. Regmi says that the state class and local elites harbour a tendency to extract surpluses from the workers and peasants through rents and taxes in the forms of money, commodity and labour without contributing to decentralised production essential for the sustainable livelihoods of Nepalis. The standard of living of this class is vastly marvelous to those of ordinary Nepalis bulging in abject poverty devoid of means of production, unemployment and habitual outbound migration to escape empty homes. National media often display its lavish style of living retained by the stealing of public money. Dependency theorists often attribute the growth of this class as a source of the nation’s backwardness and delayed rapid diversification and specialisation of the economy vital to boost national progress.

A class whose economic interest is rooted in the predation of the nation was already numerous during Panchayat. The special interest groups organised during Panchayat were the landed, business and bureaucratic ones linked to power centres. They were driven more by a lust for predation than production, exchange and distribution of resources. In the execution of development projects the polity favoured top politicians and government officials and their business clients and contractors. Late BP Koirala deemed this class bhui phutta barga which grew “solely on the basis of the manipulation of foreign aid and by means of corruption and illegal trade” marking a de-emphasis on  agricultural and industrial production, the nation’s real economy.

The support of foreign capital, aid and investment seems remotely related to the life of the deprived; as it has increased their number and, as a result, flagged domestic resource mobilisation and economic institutions on which democracy is expected to flourish. But this class under Panchayat could not brazenly express its interests, run a syndicated regime and seek autonomy from the constitution, polity and society as it does now.  As a result, despite pious rhetoric of leaders, their policies and execution failed to be people-centric. The current social formations of the new class spring from political parties, business groups, police, bureaucracy, NGOs, civil society and the public sector institutions who skewed development budget, involved in tax deceit and indulged in rent-seeking. 

The weakness of the diverse sectors of Nepalis to crystallise their shared interests has contributed to the monopoly of this new class in the national decision-making like “oligarchic-latifundista” of Latin American nations. Its effect is obvious to see: policy and plans so far pursued in Nepal have failed to cope with generational poverty and generate equal freedom and dignity for people. The new class is neither involved in policy making nor production, technological innovation, investment nor labour welfare. An old Nepali adage expresses a raw poetic precision: “A cat habituated to licking cream does not catch any mice.” It has cobbled together a legislative, executive and judiciary trio for a pact of domination, a self-serving pact that attempts to retain unhindered power and privilege among core elites. 

As Nepal does not have strong industrial capitalists of its own to invest in the nation, train the workforce, utilise the benefits of cheap labour costs, use the national resources and compete in the export market, the economic growth is sluggish and a sense of work ethics low. This class is a Siamese twin of comprador class which is inclined more towards commerce than industrialisation, consumption than production and manipulation of tax than entrepreneurship. The social formation of comprador class, like the new class, is the same.  Both are dis-embodied from the nation’s ecological, social and cultural matrix and team up with geopolitical interests. 

The ties between them are symbiotic - the former provides finance for the latter in return for its protection from the former against the public rage. Both are ill-equipped with an ideology that could combine their interests with the basic needs of Nepalis as they transcend national civic and territorial loyalties. The nation is rife with capital flight, growing national indebtedness and social decay thereby eroding the constitutional base of state. The complicity of this new class with the leaders, speculators, professional experts, donors and foreign investors enabled it to seize the state property by means of manipulation of laws and dictating the rural periphery to adjust to neo-liberalism. 

This has forfeited the power of the national state to lead and control national productive forces, stifled market regulation, especially of labour market and cut the public and social expenses. As a result, many intermediary institutions, such as cooperatives, cottage and handicraft industries which in democratic society ease the economic participation of Nepalis have declined. This drift will stay if political awareness, self-organisation and effective leadership from the people remain elemental. Weak Nepali society has offered vast scope for the new class to confiscate the coordinating capacity of the state power and incise any penchant for decentralisation, political competition, transparency and accountability. 

It has deferred democratic change of the rural periphery by means of alternative development strategies involving control of:  local resources, market, finance and technologies, labour and its productive use by rising their participation; empowering the women, indigenous groups, Dalits and deprived sections of people, develop a culture of reciprocity and redistribution, and frame the vision of society for sustainable progress. The control of political and economic power by this class has created institutional and psychological barriers against the mobility of those who come from the masses in the same way as did “The New Class” portrayed by Milovan Djilas in Yugoslavia.

 A tricky political dynamic of today is the horse-trading of major parliamentary parties eased by this class to tie-up the politicians in uneasy coalition manoeuvers rather than strengthening the constitutional system: to make politics a locomotive of social transformation. As this class has no genuine stake in the nation’s future, it educates its children abroad, seeks medical treatment abroad, consumes luxury goods, indulges in capital flight and relies on external advice and tutelage producing national inferiority complex. The de-agrarianisation and de-industrialisation of the nation, unchecked flow of foreign factories-made goods and migration of craftsmen, workers and peasants abroad for jobs has enfeebled any prospect for local capital formation.

It has thus impeded the scope for indigenous progress and infringed on the ability of democratic polity to act on behalf of Nepalis. The underlying motivation is to limit the egalitarian effects of democracy by securing their privileges against the demands of workers, women, small farmers, artisan classes, debtors and the poor. The illegal transfer of state owned enterprises to private sectors not only bred a black economy but also undermined the base of tax collection and the ability of the government to use public policy for people’s wellbeing. What emerged from the wreckage of Nepali economy is not the dynamic market, but rather an efficient amalgam of clientelist politics, corrupt business and syndicated regime.

Atavistic reflexes

The new class has obscured the role of civic forces in national construction as it evaded the issues of popular concern by integrating social interests in the general political consensus vital for system integration. As a result, the fiscal basis of the Nepali state and its capacity to tail social development - poverty alleviation, paid work in exchange economy and social integration have eroded. The economic logic of competition and efficiency has evaded the poor’s concern for fairness and social justice and insulated leadership from the social feedback. The distance grows between the experts and that of the people. As most of Nepali parties are clientelistic dominated by the new class, rather than democratic, their political culture mirrors atavistic reflexes and self-elevation of leadership. Their inner life and their structures are very much factious. 

Each faction is indulged in a lust for party-mindedness in government, bureaucracy, police, business and social institutions thereby suppressing individual autonomy affirming authoritarian politics. Violation of the integrity of persons in public office and private business has contributed to a systemic crisis in the polity and turned non-conformist Nepalis either populist, or anti-incumbent, or rebellious or cynical about the nation’s future. It entails an imperative of defending, protecting and restoring the capacities of Nepalis to shape alternative institutions and policies in order to break the monopoly of new class in accordance with their civic vision, priorities and the provision of public goods and the management of national commons. 

(Former Reader at the Department of Political Science, TU, Dahal writes on political and social issues.)

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