Do we need to work to live well? If you look at the tiny sliver of the top 0.001 % - their families often do not do market-labor. They live off the rents they raise from their accumulated capital. A few of them may be self-made, but the larger mass of the wealthy are the inherited folks. They are the landlords. If we do not question the inherited entitlement of the rich - the Trumps for example, why do we question such a desire of the poor?
The coronavirus pandemic has taught us that some occupations are more essential than others. We need the farmers, the sanitation workers, the doctors and nurses, more that the landlords at this moment. Yet, the landlords and the rent seekers hold significantly more wealth that the essential workers who live vulnerable lives - pay check to pay check. There is something sick about such a system, where the classes that do not work preach the gospel of work to those who actually work. "The poor are lazy", they say, while they themselves live off rents.
Every now and then people have identified and stated this irony, and the response to this irony has varied. Marx advocated for communism - a proletariat revolution against the capitalist rent seekers with the goal to socialise the means of production. But he implicated the bourgeois with the rent seeking capitalists. That was a mistake, as this ultimately led to the failure his entire movement. The bourgeois i.e. the city dwelling educated middle class, are the lifeblood of the knowledge economy and the source of economic, technological and often social progress. It were the bourgeois around the world who were the initial groups most receptive to liberal economic ideas of freedom and equality. They were not the enemies of progress as Marx imagined them to be. He held the bourgeois, the city folks, the industrious, the entrepreneurs in low regard, which made him and his movement an anti-knowledge-worker, anti-entrepreneur, anti-individual exercise.
We have learnt from the past that the best response to the above irony is not communism. So then what is it? Over the last decade new ideas have emerged to tackle this problem of unfair inequality. The first idea is the idea that community-orientation is an essential pillar of social support. For example, Rajan suggests in his new book (The Third Pillar) that when market, state and community are in balance then society is on a path to progress. When the balance fails there is chaos like the one we see today. Today in his view, communities have weakened considerably especially in post-industrial societies. However, in countries like India community matters, and it matters probably too much. While a majority of Indians are unable to raise emergency funds during a crisis, among those who can raise such funds almost half of them get it from their family and friends. The problem is, poor people have poor communities too, and rich people have rich communities. Hence, while communities matter and their importance can not be undermined, yet they can help the vulnerable only in limited ways.
The second idea is the idea of universal basic income, which posits that everybody should get a monthly check from the government that is large enough for them to live just fine, whether or not they work. This idea seems to be a closer response to the question - does a person have a right to live well even if they refuse to labour? Basic income proponents says yes. Yet there remains a problem. This system creates dependency on the government. Basic income is not a right, it is only a handout. As long as the government is charitable the public will get that income. If the government and its ideas changes, the public will once again be deprived of such basic income. Basic income still does not address a fundamental problem. It is wealth, not income that leaves millions vulnerable and exposed to uncertainty. The rent seekers get a good deal, not because of their high incomes, but rather because they have wealth (inherited or not) that they can seek rent off.
Hence, a way forward - distinct from communism, community-orientation or basic income - is the path of universal basic wealth. We need to create the conditions such that nobody is compelled to work just because they have rent to pay. Such a work-so-you-can-pay-the-bills, is a form of wage slavery that we need to address today. We need to take cues from the early European settlers, who occupied unsettled lands and called it their personal property, becoming their own little sovereigns. They no longer bowed to a monarch, but as owners of substantial lands they became their own rulers. We need to universalise this idea of sovereignty, where all citizens of a country have sovereignty and ownership over some substantial property/wealth on which they can build their lives as they please.
The idea of basic wealth can rest on three social endowments that every adult can be gifted unconditionally with:
The coronavirus pandemic offers us a chance to relook how we support each other. Basic wealth in the form of three endowments - a house, some savings, and emergency funding - can help in reducing vulnerability in the lives of people, and turn them into their own little sovereigns.
It is possible that some say these ideas are costly or difficult, but when implemented on a war footing building housing to shelter all is not a radical idea. Singapore has reached close to such a case of universal housing. This can be done. Similarly, unconditional basic income to children which can be accessed when they grow up, may be more effective, better targeted and affordable than universal basic income, cash transfers or subsidies. In the same way, unconditionally insured emergency healthcare funding is a low hanging fruit that can help bring millions of lives out of fear and insecurity. None of these ideas are radical, but together these solutions can provide a new deal - a package of basic wealth that can protect people, especially the poorest, and help us all lead better, fuller lives.
Probably, some people find my optimism for Indian government’s pandemic response to be irrational. After all, I have consistently said in the past that the economic mismanagement and a systematic effort to harm the social solidarity of this country will be an unforgivable legacy of this government unless we course correct. I do not trust leaders and governments. But, I trust India.
I guess I see this country differently from most people. For “scholars”, a country is a group of individuals bounded together by a social contract. In that view, India is just another country, yet another mass of people - and a poor, low human development index one. But that’s not how I see India. I see it as a Kumbh, the biggest and the most exceptional Kumbh that exists on the planet. It has a spiritual core that binds the most diverse, heretic and opposing people, in one single strand. No other country has such tremendous capacity for diversity. You won’t find communists winning elections in the USA or UK. The population of religious minorities has not reached even double digits and Europeans are already voting for far right groups. India is different. People have tried to plunder this land for centuries and yet it remains. The Vedas remain. The Buddha remains. The Sufis remain. They need no protection, and hence whatever comes to this country is transformed by their insight, in very subtle ways. Even the plunderer becomes a part of the giant stream. The river moves on, cleansing, assimilating through her grace unconditionally. It is a strange country in that way, because few other cultures can understand how Rama can pray to Ravana after the end of the war. How could Rama request Lakshma to learn the great wisdom of the Lanka King, as Ravana dies. It is strange when you think about it. Ravana is reverred in India not only by heretics, but by Rama himself. That’s why India is a Kumbh. Heresy isn‘t just tolerated, it is welcomed, and it is being welcomed for thousands of years.
The fact that India is more like a Kumbh than a country - as scholars define it - is critical for understanding India’s epidemic response. The Kumbh has no leader. It is a motley, a fair, a circus. It has both fairness and unfairness, it is raw, like an anarchy. Same is true for India. India does not rely on leaders, it never has and probably that is why India is the only true and living example of an anarchic society. It is an interesting fact that Mahatma Gandhi was an anarchist himself, he believed in Swaraj - rule of the self - and was skeptical of government. He thought “Kingdom of God is within you” inspired by Tolstoy. That is also the stance of Indian tradition. It is anarchic in nature. No final authority. It is also diametrically opposite to the modern communist Chinese way of top-down control. Yet India being an anarchy, also has a sense of the crowd. The crowd comes together when it needs to. The government is helpless if the crowd doesn’t want it. Indians rebel not once in a century but everyday. They can not be preached. Heresy is the way of this country, and we need more of it.
India is a mission based, not a system based society. When Indians have a mission, they get things done. When we had the mission of independence, we came together and boycotted the British in one call of Gandhi in 1942. That day, the British rulers had known already that the Empire was gone, because Indians, while fighting valorously for the British in the WW2, had already gained their freedom in their mind and in their actions. Indians had gratitude for the British too, we learnt a lot of things from them, and the river assimilated our plunderers and moved on. When India emerged as a democracy, many wondered if this was temporary. Indira Gandhi’s emergency should have been the death knell on it. Yet Indians got a mission, turned into street marching heretics the next day, and she was kicked out. Democracy was restored. Today, as we fight the coronavirus epidemic, once againt Indians have a mission. Other countries, (except China which locked down draconially), are having a tough time imposing the lockdown. Yet, India with one of the weakest systems of policing and crowd control, is doing it better, because once again Indians have a common mission. Probably the lack of system helps, because Indians know that if we fail in our mission, what we face is doomsday. It keeps us alert, mission oriented. And what is beautiful about this sense of mission of Indians is that it takes everyone along. It is not discriminatory. This land is for all who live here, and who are born here. There is no authority that can provide a precedence on who can call India her home. On that note, those who believe that a piece of citizenship law written in 1986 or 2003 has the power take the jus soli birthright of Indian citizenship, may you wake up soon. This country does not heed to pieces of paper, or proclaimations of leaders and priests. India is a Kumbh, an anarchy, bounded by a collective sense of responsibility, a natural respect for nature. The law that holds this land is deeper than any law proclaimed by man, or group of men.
During a period of emergency, such as the coronavirus pandemic, the public needs immediate assistance. Governments need the necessary infrastructure of last mile and last person connectivity to provide such an assistance, and the universal access to bank accounts and digital payments can go a long way in making such immediate assistance possible. How is India placed on these parameters? The World Bank Global Findex Database can provide with some answers.
The number of individuals with a bank account in a financial institution has significantly gone up in India in the 2010s (from 35% in 2011 to 80% in 2017) as per the World Bank Global Findex survey, with a larger fraction having debit cards (33%), and making/receiving digital payments (29%). Among those who still don’t have a bank account, the key reasons cited are a lack of sufficient funds (54%) and a family member already having a bank account (52%). Other factors leaving many unbanked are issues related to accessibility - financial services being too expensive (27%), too far away (23%), lack of necessary documentation (22%) and a lack of trust in financial institutions (20%). This creates a complication - the poorest and the most vulnerable are likely to not have sufficient funds and documents, and can find financial services to be too expensive. But at the same time they are also the ones who are in imminent need for bank accounts so that necessary public assistance and welfare support can reach them on time, especially during the period of emergency.
During the times of emergency, more than half of the respondents in India said that they were not able to raise emergency funds within a month (52%). For those who were able to raise emergency funds (45%), the chief source of such funds was family or friends (48%), followed by money from working (25%) and savings (23%). Compared to developed countries like Norway, Japan, UK and the USA, an alarmingly larger number of respondents are unable to raise emergency funds in India, and are dependent on family or friends for support. Government payments can become a salient form of funding for Indians in times of emergency, and can be an important policy goal especially given that the majority of Indians are unable to unable to raise any such funds.
Government payments of social benefits has not significantly increased (14%) over time in India, but the mode of these payments has become more cashless (cash payments are down from 49% in 2014 to 20% in 2017), with a large fraction of such payments reaching the beneficiaries directly in their accounts (59%). Among those accounts that receive government payments, a large fraction were opened for the first time to receive government payments (57%). Compared to other developed countries government payments still reach a small fraction of Indians (14%). While there is a thrust on digital penetration and cashless payments in India, very few Indians do digital payments (29%). In developed countries, digital payments are ubiquitous (>90%) and government payments in hard-cash are minimal (<5%).
In conclusion, based on the data it appears that India has significantly improved its capabilities in banking and digital penetration. Yet the most vulnerable are still to be reached. Especially, the most important fact that policy makers should address is this: a majority of Indian respondents in the survey say that it is not possible for them to raise emergency funds within a month's time, and if they can then they rely primarily on their social networks - family and friends. In times of a crisis like the coronavirus pandemic, such a precarious support system leaves the most vulnerable at risk. With government payments reaching a meagre 14% of the population in India, there is a lot of scope for improvement so that every Indian can be reached out and helped in times of crisis.
(update) As the Economist points out in its latest edition (4th April 2020), India's outlay to the coronavirus pandemic is a paltry 0.8% of the GDP ($23 billion), when other countries are spending much higher. The social welfare infrastructure is today ready in India; now is the time for making the last mile and last person connections, so that most vulnerable Indians can be reached. Indians await a new deal, and we should come together as policy makers to provide it now.
During the national lockdown, lacks of vulnerable migrant workers are leaving for their hometowns, often in large crowds. For example, thousands of migrants crowding at the Delhi bus station are most certainly going to accelerate the pandemic. However, the situation without a lockdown would be worse. The fear that migrant workers have today is decades in the making. Consider New Delhi. The whole city rests on the low paid labor of the migrants, but many Delhiites look down upon them with derision - as unwanted outsiders. Those who work from paycheck to paycheck have no safety net or savings, no local government support (they do not vote) and their employers have little responsibility towards their health and safety. They are the expendables of society.
Many do not appreciate the significance of bank accounts (Jan Dhan Yojana) and promoting cashless transactions (Digital India) in providing safety net to migrant workers. Such schemes have opened a channel of assistance between the central government and migrant workers that did not exist before. Migrant workers have been brought out from the shadows, although the assault of demonetization, mismanaged GST implementation and now COVID-19 has also made their situation more precarious. A major reason why the BJP government is back in power is because it achieved social welfare penetration greater than any government in the past - it pursued "programmatic politics" at least on the economic front. It would be prudent for the government to seriously consider some form of basic income at this time, and to communicate with the vulnerable groups in a targeted manner through their mobile devices. This is also an opportunity to build the social safety net India did not have in the past.
India is better prepared to manage this lockdown, and protect the vulnerable, than anytime before in the past. So, lets not panic. In an exercise of this scale, there will be setbacks, and these setbacks will get coverage (thanks to a free media), and such coverage will make the government learn and act better. This is how government is supposed to work in such times of the uncertainty and crisis. We act, we learn, and we improve.
I was quoted in the Economic Times, in an article (.png) by Dinesh Narayanan on "Data blackhole in Q1 2020 would challenge govt policymaking and corporate decisions". Here is the quote:
Unavailability of data would have implications for firm and individual level decision making. "This is a Black Swan event. Firms can plan for risk. But what we are facing is uncertainty not risk. Current forecasting techniques and methods would be useless,’’ according to Prateek Raj... Raj says true uncertainty leaves firms clueless. Government-supplied data, while important, would not be enough anymore. Firms would have to constantly search for signals in other data such as Uber orders and Amazon deliveries. ``What they would need is an ensemble of data from various sources.’’...Raj says experience from the 2008 economic meltdown showed that firms that were more decentralised and whose local managers were empowered coped better after the crisis. A similar experience may be in store now as well for both firms and governments although the trend in India seems to be towards centralisation.
Now some context. Information is the chief driver of how business gets done, something that is one of the main learning points in my PhD course on Evolution of Business and Markets. Just as the printing press revolutionised business, triggered the decline of guilds in Northwestern Europe, and gave rise to modern corporations, the same way too much uncertainty and data can force firms to change the very structure of their business. In a 2016 article for LSE Business Review, I wrote that "in uncertainty, strategic advantage comes from organisational form not plan". Firms in times like this coronavirus pandemic need to recognise that uncertainty is different from risk. While risk can be mitigated by careful planning, uncertainty requires firms to recognise that blueprints become less useful, and hence firms need to start opening all their eyes and ears for any new information, responding quickly to changing situation. The idea seems obvious, but it is not so obvious, because such a change in form of doing business requires giving more autonomy to local managers, and moving away from a centralized top-down approach. A useful research that also supports this idea is by US-based economists Aghion, Bloom, Lucking, Sadun and Reenen, which found that "firms that delegated more power from the Central Headquarters to local plant managers prior to the Great Recession out-performed their centralized counterparts in sectors that were hardest hit by the subsequent crisis." as they were better at gathering local information.
The New York Times just wrote an editorial today, requesting Donald Trump to order a national lockdown in the United States, citing India's national shutdown which affects 1.4 billion people.
Mr. Modi's actions during the coronavirus pandemic are exemplary. He has taken timely and balanced actions. The 21 day national lockdown is yet another important and timely step at a time when India's coronavirus cases were at the cliff of explosion. This is exemplary because Mr. Modi has placed the national public health interests above economic interests, something which western governments like the USA and UK have still not been able to come to terms with. The Lt. Governor of Texas went so far to say that he was willing to risk his own life to save the economy, and had urged other Texans to "get back to work".
If Mr. Modi focuses on politics of substance - the everyday common-man issues like healthcare and economy through out his tenure, India would be better prepared for such pandemics. If the pandemic spreads despite this lockdown, we will once again be in a dangerous territory, as India has just not invested in its healthcare, and instead prioritised the divisive cultural issues a lot more than it can afford to. The last few years, and NOW, is a golden opportunity for a healthcare transformation (the Ayushman Bharat is a welcome scheme), but Mr. Modi and his party/government needs to empower the doctors and nurses on the ground - whom we badly need, and not the xenophobic beasts on social media. While the last few years were a lost opportunity, but now the coronavirus pandemic is at India's doorsteps, and Mr. Modi has begun to listen to the experts, and is doing a good job. This shows that Mr. Modi is indeed a good executive, but only if he is willing to listen to the advice of experts, and does not act as a maverick or heeds to the xenophobes that infest India's entire social media ecosystem.
I hope the pandemic ends, and Indians - esp. middle class Indians (who enjoy an amplified voice) change their understanding about the role of a government. Indians must recognize the global goodwill Mr. Modi generated for India and himself, when he followed the Raj Dharma of putting the public interest first, over a divisive cultural agenda. I hope Indians do the same, and when the pandemic ends, I no longer get to see those awful Whatsapp forwards that belittle and demonize other groups, and obsess over their narrow religious identities rather than their collective nationhood. That we do not get distracted by divisive, emotive, angering and hateful propaganda and instead we talk about, and force the government to focus on healthcare, jobs, water, infrastructure, agriculture, law and order, defense, and all such things that really matter for strenthening the nation.
We need solidarity and common sense in India, not just during these times, but for all the times to come in the future.
The coronavirus pandemic offers an opportunity for countries around the world to invest and expand their healthcare capacity to fit the needs of the modern world. It is a rare opportunity, where the stress test of our healthcare system, help us improve and if needed redesign the system to dramatically expand preventive, hospital and critical care capacity using new technologies.
Can India fight coronavirus, and rapidly scale its health capacity? If you have visited Kumbh at Prayagraj, you will believe yes it can. Kumbh is simply put - astonishing. Beyond the spiritual domain, administratively and in terms of planning and management, Kumbh is an event with no global parallel. A massive city catering to tens of millions a day emerges out of nowhere at the bed of Ganges for a few months, with almost every amenity one could look for. And then it dissolves into the river. India organizes the Kumbh periodically and has learned the ability over time to live in organized chaos. It is a skill that not every country has acquired. Hence, can India deal with coronavirus? Can its health capacity expand drastically to meet the challenging needs ahead? Yes it can.
I was member of a IIMB based study that studied the 2019 Kumbh at Prayagraj. Kumbh is a floating city serving 3-5 crore visitors on its peak day. The Kumbh was incidence free and deployed a temporary sanitation system, healthcare infrastructure, transport and housing facilities for millions of visitors. How could such high levels of effectiveness be achieved at scale, when otherwise India's state capacity is considered weak? Some features of Kumbh governance model are worth emulating for the rest of India.
Each of these factors helped the government achieve scale in a manner that is uniquely suited for a diverse multistakeholder democracy like India's.
“Faith sees best in the dark.”
I often wonder what values our children and the young are imbibing when they look at the current stock of world leaders - who may have many qualities, but are bereft of moral courage. The Bhagwat Gita says:
यद्यदाचरति श्रेष्ठस्तत्तदेवेतरो जन: |
स यत्प्रमाणं कुरुते लोकस्तदनुवर्तते || 21||
Whatever actions great persons perform, common people follow.
Whatever standards they set, all the world pursues.
When leaders sacrifice human dignity at the altar of power, and when every action is acceptable to achieve certain factional goals, then the social order collapses. Without the acknowledgement of human dignity, every person is a means to an end and in such a transactional world chaos is inevitable. Hence, we need decent leaders. Leaders who lead with moral courage, by which I mean, those who have the grace to see dignity in other human beings, even in the most adverse of circumstances, even when making the most difficult decisions. Today, we need leaders who are decent, and who have passed through fire and have still come out with grace.
Former US Vice President, Joe Biden has lived an extraordinary life. Generally, with public personalities we talk about their public accomplishments and platforms. But Joe’s life, in all its fullness, has been one with many highs and lows. Amidst all of it, Joe has maintained his grace. So much so, that I have turned to Joe Biden’s many personal interviews to seek guidance in times of struggle. When Joe says, “faith sees best in the dark” he is not repeating a catchy quote; he is sharing his lived experience of coping with love and loss. That tells me, that Joe is a man of faith, faith as it should be - patient, kind, and one that sees the dignity of others. He is a leader, who has through his lived experience, found grace and steadiness in life, and is capable of leading by example. This makes me believe that Joe Biden will be a good President of the USA.
After pondering for several months, I have decided to leave Twitter.
Twitter has been a very productive companion for me. It helped me interact with academics and researchers from around the world, and kept me updated with their work. I may still sneak into the public Twitter pages of my favourite academics to learn what's up with them and their connections.
I am leaving Twitter because of its very flawed design that enables hate in the public with real world consequences. Along with WhatsApp (about which I wrote last year in ProMarket), Twitter is the favoured platform for spreading misinformation, disinformation and xenophobic call-for-action in India. In the US, there is a significant discourse on the role of Facebook and YouTube in spreading visceral and false information (see the Stigler Center report (blog here) on digital platforms). However, the negative impact of platforms like WhatsApp and Twitter on our public conversation has been ignored. Both these platforms are wild and anarchic. I like this aspect of these platforms. Twitter is a massive list of billions of 280 character messages that millions of people are posting from around the world. I appreciated this anarchic nature of Twitter. It was raw and hence vibrant. But, the "trending" column of Twitter - although meant to be an organic reflection of public sentiment - has been hijacked by coordinated and strategic coalitions dedicated to the spread of propaganda.
Over the lasts few years, thanks to a barrage of xenophobic public misinformation on Twitter and WhatsApp, I have seen dehumanising language become the new normal in private conversations. A significant fraction of people are today convinced of conspiracy theories about inter-civilisational conflict. The world has become more hysterical. Such "clash of the civilisations" narrative has turned normal people into active belligerents, and people are viewed as soldiers on "their" side of the fight, or of the "others". Such a narrative - of a state of perpetual war - helps autocrats gain and maintain power, but it only fools people. The only way to stop such a narrative that dehumanises the "other" is to improve the systems of public conversation such as Twitter. I have a very simple request: Twitter, please remove your "trending" column, which is being used today to promote outright Nazi propaganda. This call is not new. Last year The Verge also wrote an article on the same.
My trigger for leaving Twitter came during the recent deadly Delhi riots, Twitter began to nationally trend a call to economically boycott Muslims. Both the riots and such a call for economic boycott were orchestrated, and Twitter was a willing amplifier of it. I find it rather odd that a company with such technical expertise is incapable of identifying organic trends from inorganic/orchestrated/coordinated ones. I would not protest as much, if such controversial sentiments were organic. I support unfettered free speech. But it is irresponsible for Twitter to amplify orchestrated hate campaigns through its "trending" column that remind of the 1933 Nazi Germany.
As I see it, Twitter may be a useful tool for me as an academic - to network, share and connect. But at a broader societal scale, Twitter has become an enabler of visceral hatred and falsehoods, which has left scores of people dead in Delhi's streets. This is inexcusable, and I can not be a part of such a hate machine.
I hope Twitter fixes its problems, and removes its "trending' column. I support uncensored free speech, including the ones that are controversial, blasphemous or offensive, but I can not support the muzzling of the original voice of the people by orchestrated hateful and false propaganda, that platforms like Twitter amplify. Once Twitter becomes a more dignified place for public discourse, I will be happy to be back on Twitter again.
With economic slowdown, India's ability to spend on the military is also eroding. As India Today reported yesterday Indian government has less money today than last year, which means lesser spending on government schemes for development and welfare, and lesser capacity to spend of the military.
India finds itself in a precarious situation where the power gap between its neighbor China and India has increased. Uttar Pradesh - India's most critical state for development- needs to seriously invest in skill development programs that can help the large unemployed youth.
India is not investing in future technologies. Our government is living in the past, with beliefs such as Astrology is a topmost science, and talking computers - whatever it means - could be developed only by employing Sanskrit. China, in contrast, today is a world leader in future technology - from quantum computing, to Artificial Intelligence, to solar technology. For 5000 crore (cost of large scale cultural projects), India could fund 500 high tech laboratories with a seed grand of more than 1 million dollars.
All of this is disappointing, because it is like watching a kid with a great future ahead, take drugs, and squander their future, not aware how grim and dark the future will be if they do not take the right action today. The whole country should wake up from its disinformation induced slumber.