(a) Emphasis on cost control and reducing public expenditure has diverted the focus of government budgets from the basic…

(a) Cost control versus the Musgravian objectives of budgeting

Musgrave (The Theory of Public Finance, 1959) assigned budgets three functions: resource allocation, macroeconomic stabilisation and distribution. Under New Public Management and neoliberal orthodoxy, cost control and fiscal consolidation can squeeze these. Containment regimes often cut capital expenditure and social-sector outlays in health, education and rural development, weakening equity. In India, compliance targets under the FRBM Act, 2003 have at times limited fiscal space for MGNREGA (now succeeded by the VB-G RAM G Act, 2025), PM-KISAN and nutrition schemes. Internationally, post-2008 austerity in Europe deepened recessions, and Blanchard and Leigh (IMF, 2013) found that fiscal multipliers had been underestimated. But discipline and equity are not inherently opposed: unchecked deficits cause instability, rating downgrades and inflation, a tax that hurts the poor most, and stability sustains long-term allocation. The issue is the quality of expenditure, cutting non-merit subsidies while protecting growth-enhancing social and capital spending. India's post-pandemic consolidation followed this route: the Centre cut its fiscal deficit while raising capital expenditure to about 3 per cent of GDP, and Budget 2025-26 moved towards a debt-to-GDP anchor, though social-sector spending stays modest. The claim is thus partly true: consolidation diverts focus when it compresses social spending, but not when expenditure is restructured.

(b) Riggsian terms in modern forms

Riggs's prismatic model (formalism, heterogeneity, overlapping) has not become obsolete; its traits reappear in new forms. Formalism, the gap between de jure rules and de facto practice, now appears as "digital formalism": portals, citizen charters and real-time dashboards mask persistent discretion, offline rent-seeking and manual workarounds. Overlapping survives in hybrid regimes and neopatrimonialism, where rational-legal structures coexist with patron-client networks, caste alignments and politicised transfers. Riggs's "bazaar-canteen" finds parallels in unequal access to digital public goods and selective regulatory enforcement. In Indian administration, technology layered on entrenched hierarchies shows that, without institutional change, prismatic traits adapt to each reform. Riggs himself anticipated this in Prismatic Society Revisited (1973), acknowledging that prismatic features appear in developed societies too.

(c) Strong states and strong markets

Economic history refutes the state-market dichotomy. Chalmers Johnson (MITI and the Japanese Miracle, 1982) and Peter Evans's "embedded autonomy" (1995) show that East Asian markets thrived under capable states that protected property rights, enforced contracts, corrected market failures and developed human capital. In turn, thriving markets supply the tax base and technology that finance state capacity. After 1991 India saw not state retreat but "regulatory capitalism": the state moved from producer to regulator and facilitator through SEBI, CCI and TRAI, and through PPPs. The symbiosis needs institutional insulation against regulatory capture and crony capitalism. Acemoglu and Robinson (The Narrow Corridor, 2019) add that prosperity comes from a "shackled Leviathan", a capable state balanced by a strong society, not from a strong state alone.