Opinion

When a minority govt calls the shots

E. Sridharan | Updated on October 09, 2012 Published on October 09, 2012

West Bengal Chief Minister Mamata Banerjee (right) with Samajwadi Party President Mulayam Singh Yadav…in no position to topple the UPA applecart. — Shanker Chakravarty

A certain set of factors can confer on a minority government the effective powers of a majority, enabling it to push reforms.

Can coalition governments in India be stable? And if so, can they undertake economic reforms and, more generically, policies that have short-term political costs but only long-term benefits? And if they do so, can they remain stable?

The withdrawal from the United Progressive Alliance (UPA) coalition government of its second-largest constituent, the Trinamool Congress led by Mamata Banerjee, in September, over policy announcements of reduction of fuel subsidies to tackle the fiscal deficit and liberalisation of foreign direct investment, sharply poses these questions.

On coalition government stability in general and in India, the literature indicates that on average, the more the number of parties and the less their ideological connectedness, the less stable the coalition.

By type of coalition, single-party majority governments are more durable than minority and/or coalition governments on average (and/or since coalition governments can be minority governments, too).

If we disaggregate by type of minority and/or coalition government, the findings are as follows. Single-party majority governments are on average the most stable, worldwide, followed by majority coalitions, more so than minority governments, whether coalition or single party.

Within majority coalitions, minimal winning coalitions (those that have the minimum necessary number of parties, not necessarily legislators, for a majority) are found to be more stable than surplus majority coalitions (those that have more parties than necessary for a majority). However, if one changes the literature’s standard definition to one in which the exit of entry of parties does not change the coalition if the leading party remains the same, then surplus majority coalitions would be more stable on average.

Surplus majority coalitions are rational among other things as a political insurance policy so as to reduce the pivotal power of smaller parties, and as a political insurance policy against defection or political blackmail by factions within the leading party.

A reform-minded leading party in a surplus majority coalition can be relatively invulnerable to the threat of defection from the coalition by smaller partners as none of the smaller partners is pivotal, unlike in a minimal winning coalition, and cannot be sure that other smaller partners will follow it in bringing down the government.

STABILITY WITH MINORITY

In India, there is a tension between maximising participation and coalition stability. From the literature, one would have expected that in a rent-seeking polity minimal winning coalitions that maximise the power (cabinet) share of each coalition partner as well as give the government a majority, would be typical of non-single party majority governments.

However, counter-intuitively, all governments since 1989 (all non-single party majority governments) have been minority governments and except two (Chandra Shekhar, 1990-91, and Rao, 1991-96) all have been minority coalitions (dependent on external supporting parties) including the United Front governments of Gowda and Gujral (1996-98), the 1998-99 BJP-led government, the 1999-2004 BJP-led National Democratic Alliance (NDA) government and the UPA I (2004-09) and UPA II (since 2009).

However, two of them, NDA and UPA I, and if the UPA II government lasts its full term, three, have been stable despite being minority coalitions. What has been the source of their stability?

I argue that what are formally minority coalitions actually have the character of surplus majority coalitions, and this is what gives them and their leading parties, stability. In a nutshell, if one considers not just the parties in government (the executive coalition) but the also the external supporting parties (taken together, the legislative coalition), no party has been pivotal for the NDA, UPA I and UPA II coalitions, hence they are stable as they are, in effect, like surplus majority coalitions.

Additionally, some supporting parties are “inter-locked” electorally at the state level with the leading party and hence are unlikely to pull out of a Central coalition. For example, the BJP and the Akali Dal, Shiv Sena and Janata Dal (United), are electorally inter-locked, and in a peculiar way, the Samajwadi Party, the Bahujan Samaj Party and the Left Front with the Congress despite State-level rivalries, as none of them would want to create an opening for the BJP to form an alternative coalition due to both ideological (Left) and State-level rivalries. Hence, the NDA, UPA I and UPA II have been stable.

PULLING OFF REFORMS

Coming to the question of economic liberalisation, what is the capacity of such minority coalitions to undertake these types of reforms? Economic liberalisation involves policies such as fiscal cuts and opening of the economy to international competition that involve short-term costs to actually or potentially organised and mobilised groups (such as labour unions and protected industries) but only deferred, uncertain and diffuse benefits.

Hence, there are short-term political costs with only long-term and uncertain benefits for a reforming government. Under what type of coalition arrangements might these types of policies become politically viable?

One can tentatively make the argument that (a) if a surplus majority legislative coalition (including governing and supporting parties) of well over 300 (of 545) seats, is led by a (b) reform-minded leading party in a strong position, enjoying, say, 180-220 seats, with (c) the leading opposition party too small in numbers to be credible as the nucleus of an alternative coalition (say, below 120 seats), the leading party allied to (d) a number of smaller partners, none being pivotal (by definition, in a surplus majority coalition) to the majority and not able/likely to undertake collective action vis-à-vis the leading party either because they are (i) electorally inter-locked at the state level, or because they (the smaller parties) are (ii) at loggerheads, or because (iii) there are too many, say three or more parties, needed for collective action, each would-be pullout being very small, or (iv) if none of the key supporters are anti-reform, the leading party will then be highly autonomous and able to undertake policies that require a longer time horizon, at least in the first half of its term before the electoral cycle turns unfavourable.

Looking back, in the case of the NDA, conditions (a), (b), (c), (d) (i) (the Akali Dal, the Shiv Sena, the JD (U), the Telugu Desam Party and the Indian National Lok Dal were electorally inter-locked in their states with BJP), (d) (iii) and (d) (iv) were met, hence it was able to make some reformist moves, eg., disinvestment. In the case of UPA I, (b) and (c) were not met nor (d)(i) or (d)(iv) (the Left being a large chunk of the legislative coalition with 62 seats), although (d)(ii) (the SP and the BSP being at loggerheads) was.

The relative weakness of the leading party (the Congress had 145 seats) and the size of the anti-reform, statist/populist/rent-seeking parties (the Left Front, the SP, the BSP) in the coalition made reform very difficult even if desired.

UPA II was somewhat like the NDA in that (a), (b), (c), (d)(ii) (the SP and BSP), were met but not (d)(iv) since several statist/populist/rent-seeking parties were part of the legislative coalition (the Trinamool, the Dravida Munnetra Kazhagam, the SP, the BSP), and the Congress itself was not reform-minded in the first half of its term for reasons beyond the scope of this article.

By the time it became reform-minded in 2012 the electoral cycle had become unfavourable despite other aspects of a surplus majority coalition favouring full-term stability. Hence, one can conclude that while a surplus majority legislative coalition can lead to full-term stability for even a formal minority coalition, only a surplus majority coalition with several other critical conditions in place would enable even a reform-minded leading party to undertake policies that have short-term costs, but only long-term benefits.

(This article is by special arrangement with the Centre for the Advanced Study of India, University of Pennsylvania)

(The author is Academic Director of the University of Pennsylvania Institute for the Advanced Study of India.)

Published on October 09, 2012
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