Prescription For Righteous Economy

Acharya Mahaprajna travels by foot across the country. During his travels in Maharashtra, Madhya Pradesh and Rajasthan, he found that many people in the tribal areas were not getting a square meal despite much economic development having taken place during the last 50 years. What are the policies that would lead to the establishment of a righteous economy? he asked. The solution is twofold: The elite has to reduce their claim on the resources and the resources released thereby should reach the poor. Some policies in this direction would be as follows.

One, education must be withdrawn from the works of the government. Then alone will it be possible to provide an education that inculcates the value of sacrifice among the elite children. The community should manage its education. The central ideas of all religions should be taught in all classes. Students need to be told that there is much beyond consumption. This will plant the seeds of self-control, righteousness and detachment in the minds of the children. Such education can only be imparted by vanaprashthis; it cannot be delivered by servant teachers employed by the government.

Even commercialisation of education is welcome. The poor need education for which there is demand in the market. Commercialisation will provide them with such education. The budgetary stress on state governments will be much relieved by such a measure. The entire collection of sales tax in most states is being used to merely pay salaries to government teachers.

This money can then be used to provide facilities such as drinking water, road, etc. to the poor. The poor would be doubly benefited. They will get useful education from the market and they will get roads and drinking water from the government. The role of the government in education must be restricted to run a national testing service along the lines of the Education Testing Service run by the University of Michigan, US.

Two, the adverse effect on the poor due to the withdrawal of this free service should be compensated by implementing an employment policy. The present policy is to first impose tax on the people and then use that money to provide free education, subsidised foodgrains under the PDS, etc. This policy leads to the provision of substandard goods to the poor people at high cost. The main beneficiary is the government bureaucracy.

The correct way to create employment is to introduce an employment audit and impose an employment tax on all businesses. The employment auditor must examine how many cottage soap-making units have closed down due to the establishment of a soap-making plant by Hindustan Lever. Companies should not be permitted to manufacture or import harvesters because it affects employment opportunities for the poor adversely.

Industries using capital-intensive technologies must be taxed and the money should be used to cross-subsidise labour-intensive industries. The efficiency brought by the market is welcome, but it should be moderated where the livelihood of the people is concerned. Market is a wild horse that needs to be reined in with employment. Such policies will provide employment to every person and enable him to buy education from the market.

Three, a progressive excise and import duty should be imposed on all items of luxury such as cars, air-conditioners, lipsticks and chocolates. This will lead to less consumption of these items by the rich. Income tax should be scrapped. It is good to earn money and invest it. It is not so good to earn money and indulge in ostentatious consumption. Encouragement should be provided to earn money and consumption must be discouraged.

Four, a system of advertisement audit should be made. Consumption by the rich is fuelled by advertisements. Children start consuming Maggi noodles and Uncle Chipps only because advertisements hype them up as "up market" lifestyles. The purpose of advertisement should be to provide information to the consumer so that he may be able to obtain the goods of his requirement. Presently, advertisements, however, have become a means to create new desires.

Thus, the consumption by the rich grows more and more and prevents the poor from access to goods. It is necessary to impose a similar censorship on films, TV serials and media. Such censorship would conflict with the right to freedom of speech. Ways should be found to overcome this hurdle. All individual freedoms are circumscribed by public good. So also the freedom to consume. Such a culture policy would lead to reduced consumption by the rich.

Five, the banking system should be asked to stop providing loans for luxury consumption. It is easy to secure a loan for buying a luxury car but not for setting up a small scale industry. Historically, the objective of the banking system has been to gather the savings of the poor and provide them to the rich for setting up industries. This objective should be rewritten. The objective should be to collect the savings of the rich and provide them to the poor for setting up of self-employment ventures.

Banks should be subjected to heavy penalties if they do not provide loans to a specified number of self-employment ventures. A tax must be imposed on large loans given by the banks and the money must be used to provide cross-subsidy to banks providing a large number of small loans. This will make it profitable for the banks to extend small loans for self-employment.

Six, government should focus on the provision of infrastructure and law and order to the poor. It has been found in many studies that providing roads is more effective in reducing poverty than poverty alleviation schemes. Road enables the poor to go to the city for employment opportunities or to take their produce to the market. These basic services can only be provided by the government. The poor can somehow manage to buy education for his child but he cannot build a road to take his vegetables to the market. By providing subsidised food grains and not roads is a sure prescription for keeping the poor locked in poverty.

Seven, the poor should be provided with speedy and inexpensive justice, which is a public good like road and drinking water that can only be provided by the government. It is necessary to make the government sensitive to the needs of the poor. It is necessary to hold annual public hearings on the performance of government servants. Confidential letters can be sent to randomly selected consumers of electricity and telephone department asking about the quality of service provided by the lineman and other officers. The responses should be tabulated and attached to the annual confidential report of the government employees. Adopting these policies would be the first step towards establishment of a righteous economy.