In both politics and business, the mother lode is reputation. A good one gets politicians more votes and businessmen bigger bank loans. To put it simplistically, successful businesses boost the markets and trade, create jobs and expand infrastructure, which makes citizens richer and happier, and their political mentors more popular. But popularity is a fickle lover.
The Opposition has pounced on the Hindenburg report, which blames the Adani empire for doing dodgy deals to grow its formidable fortune. The target of the Congress and its cohorts is obviously Narendra Modi, the Indian leader with the cleanest reputation, who they allege helped Gautam Adani prosper.
The launch pad of the Adani billions, however, was the Mundra Port which was given land by Congress CMs in Gujarat—Chimanbhai Patel in 1993 and Shankersinh Vaghela in 1997. Magnates have ideological preferences, but the only religion of businesses is money.
From the days when the merchant classes funded royal campaigns and pageants, to today’s crony capitalism, power and money are historical bedfellows. America’s economy was built by ruthless robber barons such as Andrew Carnegie, Cornelius Vanderbilt and John D Rockefeller, who bribed, arm-twisted and wooed politicians for control of the financial system.
Once their empires were built, established and varnished by the 20th century, they did what all grubby businessmen do. They bought a reputation. But the maxim that ‘greed is good’, as Gordon Gekko outlaid in Wall Street, still sums up the capitalist ethos.
Despite the counterculture pushback from climate activists and Zoomers, greed holds good across the world. Governments favour big business because donations are the oxygen of politics. Los Angeles Times reported that Elon Musk received an estimated $4.9 billion in government support in the form of grants, tax breaks and discounted loans. Private military contractors like Blackwater earned billions from the Pentagon, exploiting the sufferings of the Middle East wars. Indian tech and construction companies have poured crores into political coffers in return for contracts. There is a lot of quid in quid pro quo.
In India, the cosy cuddle between business and politics started during the freedom movement when Congress needed funds for its cause. It was an investment that paid off for both. The handshake even had a nationalist glow. The Ambanis changed the rules of the game, interloping into the camaraderie of old money and new ministers, with brash charm and a keen understanding of the value of money down the food chain. Their power was feared because it wasn’t hidden by genteel gloss.
Too much money, and hence power, concentrated in the hands of one capitalist is a danger to democracy: on September 16, 1992, hedge fund billionaire George Soros earned the nickname ‘the Man Who Broke the Bank of England’ for shorting more than USD 10 billion in pounds and earning about USD 1.1 billion.
The pound lost value and the UK treasury lost £3.4 billion. Prime Minister John Major was forced to withdraw Britain from the European Exchange Rate Mechanism. In the US, where political money floods the elections, mega funders aren’t shy about their loyalties; while donating billions to Barack Obama’s campaign, Soros said he has made it his life’s mission to defeat George W Bush, though he regretted funding Obama later.
The marriage of industry and politics is complicated because the tycoon is Caesar’s wife. Divorce is bad for the reputation of both.
Ravi Shankar
ravi@newindianexpress.com