Economics and Dishonesty

ECONOMICS is a subject where the ruling classes are forever trying to promote ideologically-motivated explanations in lieu of scientific ones. These explanations of course can be, and have been, fitted into an integrated totality of an alternative non-scientific theoretical structure that Marx had called “vulgar economy” as distinct from classical political economy.

The Triumph of the City

THE triumph of the City of London, the one square kilometre next to Liverpool Street station that houses the citadel of British finance, is complete. Not only did it get rid of one British prime minister, whom it distrusted, in the space of just 44 days, but even got a new one of its choice installed forthwith. Rishi Sunak is being called many things: the first British Asian prime minister, the first Hindu prime minister, and so on. These facts about him however are inconsequential; notwithstanding the hullabaloo in India over his appointment, these facts are mere trivia.

Whatever Happened to Liz Truss?

THE most intriguing question with regard to Liz Truss’ resignation as the prime minister of Britain after a mere 44 days in office is this: what is it about her economic programme that the “market” (read “finance capital”) found unpalatable? At its core after all was tax-cuts for the rich, which the “market” should have lapped up.

Hunger and Poverty

THE Global Hunger Index (GHI) for 2022 has just come out, which shows India occupying the 107th position among the 121 countries for which the index is prepared (countries where hunger is not a noteworthy problem are left out of the index). India’s score on the hunger index is 29.1 which is worse than the score of 28.2 it had in 2014. (The lower the figure the less is hunger).

The OPEC’s Decision to Cut Oil Output

WHAT is called OPEC+, that is the 13 members of the Organisation of Petroleum Exporting Countries (OPEC) together with 11 other petroleum exporting countries led by Russia, decided on October 5 to cut their oil production by 2 million barrels per day, starting from November. The US had been pressing OPEC not to take this decision. There had been hectic lobbying by the US to prevent this outcome, and several visits by top US officials to Saudi Arabia, including even by President Joe Biden, to press home the point.

Acceleration in Eurozone Inflation Rate

FOR the first time ever, the annual rate of inflation in the Eurozone, measured by the Consumer Price Index, has reached double digits: it exceeded 10 per cent in September 2022, up from 9.1 per cent in August. Energy and food prices of course drove this acceleration in inflation, increasing by 41 per cent and 13 per cent respectively, but they were not the only items witnessing an increase in the inflation rate. Even if we leave out energy and food, the inflation rate in all other commodities taken together increased from 5.5 per cent in August to 6.1 per cent in September.

The New Threat on the Foreign Exchange Front

ON September 23, the value of the rupee vis-a-vis the dollar fell to a new low: it crossed 81 to a dollar after some weeks of relative stability when it hovered between 79 and 80. And it fell despite the Reserve Bank’s running down of foreign exchange reserves in a bid to hold up its value. In fact foreign exchange reserves had reached their highest level in October last year, but since then there has been a decline by over $90 billion until September 23 to just below $550 billion.

Europe’s Economic Hara-Kiri

THE cessation of natural gas supplies from Russia to Europe in retaliation against Western sanctions imposed on Russia because of the Ukraine war, is threatening Europe not only with a winter with inadequate heating that will take a big toll in terms of lives among poor people, but also with large-scale closures of enterprises; such closures would push up the unemployment rate, and significantly increase poverty and destitution among the workers.It is not just the immediate effect on Europe that threatens to be severely adverse; capital has already started relocating away from Europe to the

The Huge Danger Associated with Privatising Banks

THERE are fundamental objections to the plan of the government to privatise at least some of the public sector banks. They centre around the fact that such a move will change the pattern of deployment of credit, away from productive activities towards speculation, away from peasant agriculture towards big business (with dangerous implications for peasant viability, food security and employment), and away from domestic to global destinations.

First Quarter GDP Estimates for 2022-23

THE estimates of Gross Domestic Product for the April-June quarter released by the government on August 31 paint a dismal picture of the Indian economy. Since the GDP in real terms (at 2011-12 prices) shows an increase of 13.5 per cent over the first quarter GDP a year ago, and since 13.5 per cent appears an impressive figure, official spokespersons have been putting a cheerful gloss over it.

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ECONOMIC NOTES