Friday, February 18, 2011

Measure growth at individual level

Mani Shankar Aiyar writes
  • a function where S Tendulkar the Chief Economic Advisor to the Prime Minister, drew attention to the Presidential Address of Simon Kuznets - the greatest authority the world has ever seen on national income - to the American Economic Association, where he said, “…all growths lead to widening inequality and therefore the higher the growth rate the wider is the chasm that grows between the better off and less well off.” He argued that this inequality does not amount to any lack of equity because the processes of growth raise the living standards of all. I think, statistically it is impossible to deny this. The only thing is that it does not apply to any one generation of people. It takes 250 years in historical terms for levels of living to be raised in society as a whole to render questions of inequality as being beyond the pale of democratic politics. 
  • In India we ought to recognize that we are doing something that is historically without precedent: creating a full-fledged democracy before embarking on the processes of growth. In the USA, the constitution proclaimed the right of all to life, liberty and the pursuit of happiness but denied it to those who were the indigenous people of the USA. Perhaps some of the worst expropriations of other peoples land without the payment of any compensation and with death inflicted as punishment for refusing to part with land was in the same USA. It was quite late that the right to life, liberty and the pursuit of happiness was in theory granted to an entire people who had been stolen from another continent and transported across the Atlantic Sea to provide the manpower for the economic development of North America. After the proclamation of the emancipation of the slaves in 1863, it then took another 101 years till 1964 for the Civil Rights Bills to be passed to enable the American Black to enjoy the same civic political rights as others in his country.
  • In the United Kingdom, democracy took approximately 1,000 years to evolve from being a matter of the rights of the Barons vis-à-vis the King which is what the Magna Carta was about, to women getting the Right to Vote in 1928. In France, they had a revolution in the name of ‘liberty, equality, fraternity’ and because fraternity means fraternal relations between brothers, half the population of France - the women - did not get the vote until after Hitler had been defeated in 1945. It is not surprising that the first feminist was a French woman called Simone De Beauvoir and her most celebrated book is called the ‘Second Sex’. Trade union rights, which are a phenomenon of the second or third century of the industrial revolution in developed democracies, had been enshrined in our Constitution and our law approximately 25 years before we even began our industrial revolution. So, as a result of 60 years and more of unbridled democracy, we have created a class consciousness among people that doesn’t require a dictatorship of the proletarian. These people, who have exercised political rights, are today asking themselves increasingly the question ‘what is in it for us’? What profits us if Bangalore becomes the IT capital of the world? What profits us if in pharmaceuticals the Indian industry is unbeatable? Curiously, the question becomes more and more serious as you go down the social hierarchy for it is by the most poor, the most deprived, the most exploited and the most discriminated-against segment of the Indian population, namely the tribals, that this very disturbing question is being put to the Indian State.

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