The “Sink” for Indian Capitalism

THE distress to which lakhs of migrant workers were suddenly exposed by the Narendra Modi government’s decision to announce a three-week-long lockdown at four hours’ notice with zero planning, has also highlighted a crucial aspect of the Indian economy.

Finance Versus the People in the Era of the Pandemic

THE current pandemic has brought to the fore, and with exceptional clarity, the fundamental contradiction underlying contemporary globalisation, namely, the contradiction between the interests of finance and thoseof the people. Indeed this contradiction, which characterizes the era of globalisation as a whole, has now come to a head.It is becoming clearly visible in country after country. Take the case of India.

The Making of a Tragedy

THE tragic irony could not have been more complete.

Pandemic and Socialism

IT is said that in a crisis everybody becomes a socialist; free markets take a back seat, to the benefit of the working people. During the Second World War for instance, when universal rationing was introduced in Britain, the average worker became better nourished than before. Likewise, private companies get commandeered to produce goods for the war effort, thus introducing de facto planning.Something of the sort is happening today under the impact of the pandemic.

Some Basic Lessons from the Pandemic

THE coronavirus attack has so far been much less deadly than the Spanish flu of a century ago. That had affected 500 million people worldwide, about 27 per cent of the world’s population of the time, and had a death rate of about 10 per cent among those affected. (Estimates of death vary greatly; this is a sort of mean). In India alone 17 million people are estimated by some to have died because of it.

Why have Indian Banks become Financially Fragile?

THE crisis at Yes Bank is only the concentrated expression of a deeper malaise afflicting the Indian banking system as a whole, namely its vastly increased financial fragility. The chief economic advisor is no doubt right when he assures depositors, through the media, that the Indian banking system is quite stable; but this still does not negate the fact that it has become more fragile.

Economy Sliding into Stagnation

CHANGES in estimation methods have of late made statistics on the Indian economy increasingly bewildering; besides, whenever the statistics show the performance of the economy in a poor light, the BJP government simply suppresses them. Nothing however can suppress the fact that the Indian economy is sliding into a serious state of stagnation. The third quarter (October-December) GDP estimates which have just been released show a 4.7 per cent growth over the corresponding quarter last year, which comes on the heels of a 4.5 per cent growth in the second quarter.

The Uses of “Populism”

CLASS struggle occurs in the realm of concepts too. The World Bank for instance systematically counters Left concepts by employing a novel tactic: it uses the very same concepts as are used by the Left, but gives them a wholly different meaning; as a result they either come to mean something entirely different from what the Left had originally meant by them, or, at the very least, they become fuzzy and hence useless to the Left. In either case the power of the Left concept is neutralised.For example, the term “structural” used to be an integral part of the Left lexicon.

Bereft of Macroeconomic Vision

THOUGH finance minister Nirmala Sitharaman laboured for well over two hours when delivering her budget speech, it is likely that the aspect of the speech that will receive popular attention would be the restructuring of income tax slabs and reduction in rates that would benefit the tax paying middle class. That was obviously also the intention of the exercise.Budget 2021-22 was being presented at a critical time for the economy, with growth decelerating sharply, and evidence of adversity not just in the informal economy but in the corporate sector as well.

Capitalism, Socialism and Over-Production

THESE notes are meant to clarify a point made earlier (Peoples’ Democracy, June 30, 2018) about the erstwhile socialist economies not having over-production crises as capitalist economies do.It is in the nature of capitalism to have “over-production crises”, i.e., crises arising from “over-production” relative to demand. “Over-production” does not mean that more and more goods keep getting produced relative to demand, so that unsold stocks keep piling up.

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Peoples Democracy

ECONOMIC NOTES