ECONOMIC NOTES

On the Proposal for a Universal Basic Income

WITH Rahul Gandhi’s announcement recently at Raipur that his Party had taken a “historic decision” to introduce an income guarantee scheme for the poor, and with the general anticipation that the Modi government’s last budget will also announce an income support scheme in some form, at least for the “farmers”, the idea of a “universal basic income” for the Indian population is once more in the air.

The Apparent Enigma of Growth

AT first sight it appears to be an enigma. India has been recording, according to official statistics, one of the highest GDP growth rates among all the countries of the world, so much so that epithets like “emerging economic superpower” and “a global powerhouse of growth”, have been freely used to describe India’s achievement. Bourgeois commentators display much pride over the fact that India is in the process of surpassing even China in terms of its growth-rate. The IMF is now talking of India leading the world in 2019 in GDP growth.

The Subversion of MGNREGS

THE National Rural Employment Guarantee Act that brought the MGNREGS into being was a unique piece of legislation in the history of independent India. It stipulated that employment was to be made available on demand, within a fortnight of being asked for, failing which an unemployment allowance had to be paid. True, its scope was confined only to rural areas, and it promised employment only upto 100 days per household per year; but it made employment a right.

Entrapping within a Discourse

ENTRAPPING all intellectual discussion within a particular discourse is the commonest method that neo-liberalism uses for establishing its hegemony. There was for instance the debate recently on the question of the “autonomy” of the Reserve Bank, where one side wanted control over the RBI by the government and its coterie of “crony capitalists” while the other wanted an RBI catering to the whims and caprices of globalized finance. The question of popular or parliamentary control over the institution was simply never raised.

Criticism and Criticism

FORMER Reserve Bank governor Raghuram Rajan has come out openly against the Indian government’s measure of demonetisation of currency notes in November 2016, in a speech delivered recently at the University of California at Berkeley. Since Rajan is an economist of repute, and has been an important economic decision-maker in the country, his criticism of demonetisation is to be welcomed: it adds considerable weight to the voices that have been raised against this wanton and despotic measure of the Modi government.

A Looming Fiscal Crisis?

THE UPA-2 government, in its last three years in office, had been obsessed with ‘fiscal consolidation’ – a retreat from the limited ‘fiscal stimulus’ announced after the global crisis. The pre-occupation was with bringing down of the fiscal deficit, more so by restricting public expenditure growth instead of stepping uprevenue mobilisation. The change of government in 2014 produced no shift in this basic thrust of the fiscal policy of the central government.

The Yellow Vest Movement

NOTHING shows the crisis of neoliberal capitalism more clearly than the popular uprising in France that is occurring under the banner of the “Yellow Vest” movement. Thousands are congregating in Paris over week-ends to protest against the intolerable burdens being imposed upon them in the name of “austerity” and to demand that resources be raised instead through taxing the rich. This movement had begun initially as a protest against the diesel price-hikes, but has now taken on a more general character and is drawing huge support from the people.

The Emerging International Regime

THIRD world economies are now facing a reduced export demand for their goods and services for two distinct reasons. One is the world capitalist crisis which entails a reduced aggregate demand in the world economy and hence reduced aggregate exports for all countries taken together; the other is the protectionism of the US, which, by garnering for that country a larger share than it would have otherwise had of this reduced world market, leaves correspondingly less for others.

Real Wage Growth in the World Economy

THE International Labour Organisation (ILO) has just brought out its Global Wage Report 2018-19 which provides data on real wage growth in the world economy for 2017, the latest year for which such data are available. This shows that real wage growth for the world economy was 1.8 per cent in 2017, which was not only lower than the 2.4 per cent growth of 2016, but was the lowest annual growth rate since 2008, and certainly lower than what the world economy experienced before 2008.

Vilifying the Intelligentsia

NARENDRA Modi said the other day, rather disparagingly, that the “Urban Naxals” live in air-conditioned comfort. Since all who speak or write in public upholding the right to dissent from the Hindutva positions, including even known critics of the Left, which means virtually all members of the intelligentsia who display any integrity, have been dubbed “Urban Naxals” by his government, his remark in effect amounts to targeting the entire intelligentsia.

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