Keynes and Umaid Bhawan Palace

21 October 2021

The world is waking up from a pandemic wave. We don’t know if there will be another wave. Globally, we’re at the trough after three waves, and it does seem like we’re past the minima here. Russia and UK are reporting a concerning rise in new cases. With this background, the US passed the $1 trillion infrastructure bill. Apart from fulfilling the generally good idea of upgrading a country’s infrastructure, what good do such bills do? In India, we’ve started construction work on Central Vista, which would be our new parliament building. There are two straightforward points in favour of the project. One, it provides employment. Two, it serves some symbolic notion of a new India. There are several critics of this project. The critics would agree with the first point and would disagree with the need for the second. After all, expenditure on schools and hospitals could also serve towards employment. I do have my views here, but our plan for today is not politics. Let’s dial back. The common theme between these two examples is government spending leading to a rise in employment. Where have I heard that before?

My first introduction to the idea was reading Jholawala Economics by Prof. Jean Dreze. This man has had notable contributions in getting India’s Rural Employment Guarantee Act off the ground; NREGA, MGNREGA or whatever variant. It guarantees 100 days of employment in a year. The point is that the government can use this labour for local infrastructure projects. Economists here would not take long to recognise that this rhymes with Keynes’ general theory and his recommendations for government spending to stimulate the economy. It is easy to point out that NREGA is a Keynesian idea, and all such projects are a popular decision because of his influence in economics. I don’t think this is true, but soon in this article, we’ll look at a couple of examples of the same idea pre-Keynes, and I found that amusing, and that’s why I am writing this.

However, especially around NREGA, even if the inception was not Keynesian, the atmosphere around it has undoubtedly been. You see, Keynes’ had this quote in his work- “The government should pay people to dig holes in the ground and then fill them up”. There is more context around this. He certainly did not mean this is a verbatim recommendation. But it’s a dramatic line, and dramatic lines may sometimes stay a part of narratives longer than solid theories. So much so that this has been used as a critique of NREGA. Here are two articles [one by Jean Dreze] that I found that counter-argue the critiques- Jean Dreze and Reetika Khera.

These instances were not supposed to be part of this post. While discussing this post, I heard from a friend that pre-NREGA, during the times of Indira Gandhi, there used to be a similar act where they went to the extremes of digging ditches and filling them up. I could not find anything about such an act. Still, okay, even if there was such a thing, I am personally more inclined to believe in the strength of powerful narratives than thinking that people are simply practising their inner Sisyphus in each iteration of this act.

With this fuzzy background in place, read the story of Umaid Bhawan Palace in my hometown of Jodhpur. In one line, the palace was built to provide employment during a famine. Interestingly, the palace was commissioned in 1929, and Keynes published his General Theory in 1936. All infrastructure projects are not inspired by Keynes, after all. Someone else on the world-wide-web has noticed this before me.

How would the Maharaja arrive at this idea? Look, it is entirely possible that this was a genius offspring of his mind, but more often than not, innovation is pulling old ideas into a new context. It is now a new idea, but it did not come in a dream. Famine prevention has been a big deal in the Indian subcontinent for time immemorial. The subcontinent has always depended on unpredictable monsoons. There are popular theories that a shift in monsoon patterns led to the decline of the Harappan civilisation and our ancestors moving to the Gangetic plains.

A Wikipedia page on the subject claims that the oldest mention comes from Kautilya’s Arthashastra, which is 3rd or 2nd century BCE. There is some nuance here. The Wikipedia mention can be traced back to Jean Dreze and Amartya Sen’s work. I want to dig deeper, and I want to know the precise chapter where Kautilya would mention this. Well, Dreze and Sen are referencing another piece of work.

‘institute the building of forts or water‐works with the grant of food, or share (his) provisions (with the people), or entrust the country (to another king)’

Chetty, V. K., and Ratha, D. K. [1987], ‘The Unprecedented Drought and Government Policies’, mimeo [New Delhi: Indian Statistical Institute].

I am very disappointed that I could not find this work. I went to Shamasastry’s translation of Arthashastra to find anything relatable. R. Shamasastry is credited with the re-discovery and translation of Arthashastra, so I could not do better. The closest is Book IV, Chapter III- “He [king] may either do such works as are usually resorted to in calamities”. If you look at the surrounding text, you will see that ‘usual calamity work’ could mean a wide variety of stuff; a lot of it superstitious. I would have loved to trace this to an ancient text, but I would not make that conclusion without more evidence. Scientific truth is a narrow path; powerful narratives are potent lures.