Two or more companies often come together, not necessarily to merge and form a new corporate entity, but merely to enter into a strategic arrangement to share resources or exploit a common market. The expectation of these companies with reward to the quantum of benefits that would accrue and the manner in which such benefits would be shared among the constituents are clearly identified and woven into the understanding, well in advance.
But political parties are not able to come together within a framework of strategic cooperation and reap synergistic benefits available, both in terms of additional seats to be won and an opportunity to form the government. Well, at least not often enough, although such opportunities existed at all times. There is a clear dichotomy in the way these parties approach elections at the national level as opposed to their poll battles at the regional level.
Coalitions, here to stay
At the national level, they have recognised the inevitability of such coalition arrangements if they nurse any hopes at all of capturing power at the Centre. Not since 1984, when the Congress party led by the late Rajiv Gandhi won a massive three-fourths majority in the Lok Sabha, has there been an instance where a single party was able to capture power at the Centre by going it alone at the hustings. Even the BJP, which obtained a majority of Lok Sabha seats for itself in the 2014 General Elections, did so only as a member of a larger political grouping. Statistically speaking, at least, the odds favour a collaborative approach rather than going solo.
At the State or regional level, however, things haven’t always panned out on these lines. Even though the opportunity to harvest synergistic benefits exist, they have been routinely missed by parties choosing to go it alone at the State level. A case in point is the recently concluded election to the Tamil Nadu State Assembly. The incumbent ruling party, the AIADMK, polled a little over 40 per cent of the votes cast and yet walked away with nearly 60 per cent of the Assembly seats.
Even in West Bengal, Ms Mamata Banerjee, who won a resounding victory, bagged only 45 per cent of the votes cast. But that didn’t come in the way of her party walking away with more than three-fourths of the Assembly seats. In that sense, the latest clutch of State Assembly elections ran true to form, where the parties that ended up on the losing side of the equation suffered such a fate only because they could not come together on a common platform.
Strategic alliances
This raises a basic question: Could the losing parties have done something about it? This is where politics tends to differ from the world of business. If two business enterprises perceive complementary strengths, it is natural for them to come to an understanding and form a strategic alliance for mutual benefit. Differences in the ownership structure or variations in the geographical niches where they operate, or other dissimilarities, do not appear to matter much. In fact, differences in operational profiles are at the very heart of their desire for a synergistic alliance or combination.
Indeed, if two enterprises were mirror images of one another, there would really be no advantage for either to come together under a strategic framework. In the case of political parties the prospect of an alliance is subject to an additional constraint that their coming together should not trigger a dissonance in the underlying social or ideological affinities between the party and its underlying voter base. This is important because the affinity that a voter feels for a particular party has less to do with what it is and more to do with what it isn’t.
The CPM enjoys the support of a significant section of the Muslim population in West Bengal because it is not the BJP and not because it believes that CPM will bring in Sharia law in the State administration or nationalise all private enterprise if voted to power. As much as political parties talk about economic and social policies and so on, electoral politics is really about affinity. More importantly, the politics of affinity operates at a more subliminal level than what it might seem on the surface.
Structural constraints
Business enterprises suffer from no such constraint. If a customer of Colgate Palmolive buys Colgate toothpaste, that is because he likes its minty flavour or it makes the teeth sparkle and not because it is not manufactured by Hindustan Unilever. In such a situation, it is easier for two companies to share manufacturing infrastructure or distribution logistics and still not have to fear any loss of custom, as a consequence.
Viewed purely from the perspective of electoral synergies, West Bengal shows there are structural constraints to the extent the consolidation of voter base across parties can be achieved. In other words, there is a natural upper limit to the synergy potential that may well fall short of the magical half-way mark. But the same cannot be said about the various combinations that fought the recent election in Tamil Nadu.
The DMK fought the election in alliance with just the Congress party and the Muslim League. But it could just as well have fought it by roping in parties in an alternative formation — People’s Welfare Front. There was nothing in the profile of parties that made up this third front that could have caused any serious issue of ‘negative affinity’ among the supporters of either the DMK or the Congress. This was practically conceded by the DMK as the latter turned down the offer of a larger joint front as it was averse to any power-sharing with other parties. This proved a costly miscalculation on its part.
Why talks flounder
Had they fought the election together and agreed to a sharing of power if the combination won a majority of seats, the outcome would have been vastly different. Based on the votes polled, such a combination would have secured as many as 155 seats as against 98, the number of seats that a truncated alliance led by the DMK secured. In other words, while there was implicit agreement on the potential for synergy gains from such a combination, the DMK wanted to secure all of that for itself which, obviously, would have been the deal-breaker.
Even if parties recognise that synergy gains need to be shared, alliance talks can flounder on the question of what each party is bringing to the table and how they should be rewarded in terms of the number of seats allotted. Here, too, perceptions and subjective judgments (chemistry) colour the assessment of leaders of political parties leading to inequitable offers (seats) being made and consequent breakdown of seat-sharing talks. But it is possible to conceive of an objective basis for such an allocation that takes into account the potential synergy gains (number of additional seats that can be won) and an equitable basis for computing the share of each party.
In the Tamil Nadu case, the DMK had a ‘mini’ alliance consisting of itself, the Congress and the Muslim League, as opposed to a potential larger alliance — call it a ‘mega’ alliance — involving the People Welfare Front (PWF). Obviously the parties constituting the PWF too would have to be accommodated with some seats as part of the ‘mega’ alliance. How is this to be done? As it turned out, the ‘mini’ alliance got 98 seats (DMK: 89, Congress: 8, Muslim league: 1) while the parties constituting the PWF drew a blank. But when the votes of the contesting candidates under both the alliances are aggregated, the resultant ‘mega’ alliance would have netted 155 seats. There is thus a synergy gain of 57 seats. This incremental seat gain accrued directly as a result of pooling of votes polled of the PWF candidates to that of the DMK-led ‘mini’ alliance.
Vote share, only logical basis
It can be nobody’s case that all of those seats should be allotted to the PWF parties. There is no reason for the DMK to agree to such an arrangement since it involves no advantage to it. Equally, it can’t entirely be appropriated by the DMK or its other ‘mini’ alliance partners as there would be nothing in it for the parties making up the PWF to come together under a larger formation. The only logical basis for sharing of seats is the percentage of votes polled by the respective parties. It is this vote share that would make a difference between victory and defeat under the ‘first-past-the-post’ system of electoral democracy in the country.
The PWF parties cumulatively polled 6.1 per cent of the total votes polled. The DMK and its two other alliance parties polled 38.7 per cent of the total votes polled. But that 6.1 per cent would have resulted in 57 additional seats for a ‘mega’ alliance led by the DMK. It follows therefore that these 57 incremental seats should be distributed between the ‘mini’ alliance partners and the new ‘mega’ alliance partners in the ratio of 6.34:1. That translates into 47 seats for the DMK, Congress and the Muslim League while the PWF gets the remaining eight seats. The seats that would have still been lost could again be distributed in the same proportion. Of course, all this has been done with the benefit of hindsight. But the formula could be applied based on the party performance in the 2014 General Election. The important point is that it offers a rational and, more importantly, equitable basis for allocation of seats among constituent parties forming an alliance.
The problem is that each party thinks that it has grown a little bigger, and that the potential allies have suffered a certain amount of erosion; of course, the erosion suffered by the ruling party due to an inherent anti-incumbency factor should accrue entirely to itself. In short, there are far too many issues of subjective judgments that cloud the prospects of an alliance capturing synergy gains. In short, from each party’s perspective, all ‘synergy gains’ should accrue to it. But then, politics is really all about chemistry and very little about arithmetic.