NOTE :- This article was originally written about 4-5 years before the so called Liberalisation, Privatisation and Globalisation in 1991. India is the only country here public servants proudly declared that they had become liberal to their masters - the people and that too in an ingratiating manner ! Two decades after the event - now demurely called Economic reforms - and GDP growth rate increasing from around 3 % to over 8% it is time whether we continue to be anti-productivity in another guise. The footnote to this article will do that.
Is the Indian Society Anti - Productivity ?
Persons engaged in economic pursuits can be divided into two broad categories viz, :
1) Those engaged in production of goods and
2) Those engaged in providing services.
The second category can be further sub-divided into :
2a) Those engaged in services contributing to production and
2b) Those engaged in providing regulatory services such as i ) the government, be it in the bureaucracy or in the political wing or ii ) religious bodies which tend to regulate the social norms by which people ought to live.
We have one category in addition to the above two which is not pursuing any economic activity except for consumption. They are the aged, the children and the beggars. The aged are being compensated for their past contribution. The children's consumption is our investment in expectation of their contribution to production at a later date. The beggars, especially the able-bodied ones are socially criminals. Even among beggars, there are the honest ones and the dishonest ones who collect donations for various stated purposes but use the money for their personal use. In India this category has a larger population than in other countries.
Any society which is pro-productivity and therefore flourishing, gives far better rewards to persons engaged in category 1) as compared to to those in category 2). Even among category 2) those in category 2a) have better rewards than those in category 2b).
The Indian society has traditionally rewarded the producers badly. In the old days when agriculture was the main productive venture, rewards to the agriculturists were much lower whether in economic terms or in terms of social status than to persons of the regulatory classes such as landlords, religious priests, government servants and so on.
The copndition after independence and industrialization has not changed. We tend to give too much importance to the regulatory personnel whose contribution to productivity is at best marginal if not on the negative side. Look at our political and social set up. The party, the prganization or the individual who can put the wheels of production to a more complete stop by means of strikes and bandhs is considered to have a bigger sway on the masses. Terrorism is only an accentuation of this coercive method by a section of the people to get their demands accepted by the people as a whole. The days of constructive work as a means of reaching out to the masses and influencing them by rendering actual help, empowering them to become self reliant, are over. In the same way, the bureaucrat who can put more spokes in the wheels of production is more fawned upon if not also more empowered. People who can incite violence and let loose terror, are wooed by the ruling establishment. Like the givernment, religion too has a regulatory role in a society. Religious leaders are also given too much importance as compared to their contribution to productivity. Even the media give too much coverage of non - productive activities of politics and religion. Both are luxuries which only a productive society can afford. We, Indians, tend to behave like a post - wealth generation society while still being in a pre - wealth generation phase. We forget that everything has a time and place.
In fact, in our country, rewards to persons in category 2b) are the highest, followed by persons in category 2a) and the least beneficiaries are persons in category 1). - exactly opposite to the desirable situation. It has resulted in the dignity of labour being forgotten and making blue collar infra dig. This is the main reason for our continued backwardness.
In view of the fact that a reduction in prices or at least stability in prices despite increasing demand is mainly dependent on an improvement in productivity, it is imperative that Indian society as a whole, nhould sit up and change its attitude and perspective. It is useless to expect only one section of the society viz. the regulatory personnel ( i.e. the bureaucratic and the political classes ) to do anything in this regard since any change for the better hurts their own self interests in terms of reduction of power and control not to speak of the rent collection.
A case in point is the procrastination, prevarication and finally outright rejection by these classes to concede a higher or even an equal dearness allowance to productive personnel of the public sector as compared to what is given to the government's own regulatory personnel. The government can merrily go on taking anti - productivity steps. Its personnel especially those in the lower rungs with whom the common man deals the most, are compensated fully for any consequent price rise. They care, therefore, the least for any price rise that takes place. Even its personnel in the higher rungs are compensated to the extent of 70 % of any price rise that takes place, the balance 30 % being taken care of by the power that they wield over the destiny of any productive personnel who dare to improve productivity and profitability. The regulatory personnel have thus no stake in improving productivity. The political class depends on donations and other similar sources of income which increase with price rises. The brunt of the burden of the price rises has therefore to be borne by the productive personnel while others who outnumber them in terms of numbers, income or influence can merrily take anti - productivity steps. Even the service personnel like doctors, lawyers, the trading classes can hike up their prices at their own will.
It may be argued that I have painted a picture that is gloomier than reality. However the fact remains that given the attitudes and perspective of the Indian society and our experience of the last 40 years and the results emanating therefrom, there appear to be only black clouds looming on the horizon on the productivity front.
Whenever any industry in the private sector is able to increase its profitability by an improvement in productivity, it is immediately more heavily taxed in the name of mopping up surpluses for " public good " . A case in point is the capital gains tax. Industries therefore find it easier to improve their profitability by oiling the appropriate regulatory wheels which can, by suitable variation in taxation and osuch other measures, do the trick. The world bank have also commented on these lines in a recent report published in the newspapers.
Mahatma Gandhi's idea of Swaraj was for a minimum of dependence on the government whether it was an alien one or an indigenous one. Since indepedence, we have gone in the opposite direction. We have become such slaves that perhaps very few activities such as death are not in government's control. Is it therefore any wonder that the common man expects the government - the so called Sarkar Mai-Baap to do everything for him without any contribution on his part. The addiction of the government is so strong that even while cursing it, he is unable to kick it off. In Transactional Analysis terms, the government has become the controlling parent and the common man , an adapted child. Surely not the freedom we fought for !
We can even say that we have by now imprisoned the Swaraj along with any possible improvement in productivity. The two go hand in hand. Creativity flourishes only in in an atmosphere free of throttling controls that regulate every activity. We have firmly locked up Swaraj and Creativity. Opinion leaders in all walks of lifemay like to ponder over the issues raised here and create the necessary climate for producing a "Shatalin Plan" of our own for regaining Swaraj. Or shall we wait to be fully imprisoned a la Eastern Europe or a la Pakistan before we break free ?
Improvement of productivity in all spheres of life, busting of the " Protection Racket " for our Private Sector are the crying need of the hour. the protected atmosphere in which the private sector operates has become an addiction. Unless we take all steps to improve productivity, we as a society, are heading for a runaway inflation of the type faced by the Germans in the 1930s and by the Chinese in the 1940s and what is staring the Eastern Europe at present. A change in the attitudes and perspective of the Indian elite as well as the masses is urgently called for.
FOOTNOTE:-
Within 4-5 years of writing the above article, the economic reforms came. As is normal with us Indians, they were forced on us by force of circumstances. Remember the pledging of our gold when only 15 days' worth of foreign exchange was left with us and cosequent launching of economic reforms? What are the pluses and the minuses of the economic reforms twenty years down the line ?
The pluses according to me are:-
1. Foreign exchange position is comfortable, perhaps far too comfortable. We are in fact contributing to the financial bail out of some European countries - a reversal of the situation pre reforms.
2.Our exports have increased manifold.
3. Our GDP growth rate has gone up from the " Hindu growth rate " of around 3 % to over 8 %.
4. Salaries have gone up, whether in the private or the public sector.
5.Disposable income has gone up, resulting in higher savings rate.
6. Waiting period for cars, scooters, telephones and other such largesse wheedled out of government functionaries at great cost of time, money and effort has been reduced to the time required for a telephone call. The spread of vehicles and telephones has perceptibly gone upto the lower strata of the society in this 'capitalist' era than in the earlier 'socialist' era. It is not uncmmon in cities now for a domestic servant to ring up on his mobile if he is going to be late for work as he is attending to a puncture on his moped wheel.
7. The rationing mentality caused by scarcity of goods of all descriptions has now been turned into a problem of which brand to choose due to a glut in the market. The quantity of old goods and variety of newer goods has gone up. The craze for 'phoren' goods has gone down.
The minuses according to me are :-
1.Corruption has gone up in intensity even as areas with scope for corruption have gone down judging by the scams coming out serially.
2. The salaries of regulatory personnel have gone up. Even the MPs have voted their own pay hike.
3. The expected reduction in government employees' strength has not taken place.
4.Inflation has reared its head as in the field of agriculture, no improvement has taken place.
5. The control and power mind set has not changed. This is a big hurdle in the path of eradication of corruption.
6. An attitude of service on the part of the public servants is not yet visible. They still behave as the masters of their " Ryots ".
7. The government's control on the life of the common man has not gone down. Least government is the best government. We must have more and more of self-regulation than a rigid but subject to correction by corruption governmental regulation. We must reduce the size and scope of government.
No comments:
Post a Comment