The Subversion of MGNREGS Prabhat Patnaik

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 up to 100 days per household per year; but it made employment a right. The fact that it was passed unanimously by parliament, after much deliberation, meant that parliament was in effect creating an economic…

The Anatomy of Imperialist Intervention Prabhat Patnaik

What is happening in Venezuela today provides an object lesson on the nature of imperialist intervention in third world countries in the era of neo-liberalism. Imperialism has of late intervened along similar lines in other Latin American countries, notably Brazil; but Venezuela, precisely because of the strong resistance it has put up, shows the techniques of imperialism in sharper relief. Not long ago, the Leftward turn in Latin America, not just Cuba, Bolivia and Venezuela, but Brazil, Argentina, Ecuador and several other countries where Left-of-Centre regimes had come to power and pursed redistributive policies in favour of the working poor,…

Agribusiness is the Problem, Not the Solution Jomo Kwame Sundaram

For two centuries, all too many discussions about hunger and resource scarcity has been haunted by the ghost of Parson Thomas Malthus. Malthus warned that rising populations would exhaust resources, especially those needed for food production. Exponential population growth would outstrip food output. Humanity now faces a major challenge as global warming is expected to frustrate the production of enough food as the world population rises to 9.7 billion by 2050. Timothy Wise's new book [Eating Tomorrow: Agribusiness, Family Farmers, and the Battle for the Future of Food. New Press, New York, 2019] argues that most solutions currently put forward…

Resources for Welfare Expenditure Prabhat Patnaik

The basic income scheme that is in the air these days, which amounts to handing over a certain sum of money to every household to ensure that it reaches a threshold cash income, is an extremely flawed scheme. Instead of enjoining upon the state the obligation to provide essential goods and services like food, education, and health, to its citizens, it absolves the State of all such responsibility, once it has handed over a certain amount of money, an amount moreover which is not truly indexed to prices and whose transfer is usually accompanied by a withdrawal of existing subsidies…

The Great Budget “Cash for Votes” Scam – and Other Cash Transfer Schemes Jayati Ghosh

The big-ticket item in the “Interim Budget 2019-20” was the announcement of a cash transfer to farmers holding less than 2 hectares, of Rs 6,000 per household to be paid in three instalments of Rs 2,000 each. Estimated to cover around 120 million households, it is projected to cost Rs 75,000 crore over a year. Amazingly, the government also declared that it is providing this amount with retrospective effect from 1 December 2018, so that the first instalment would reach farmers’ bank accounts by end March of the current financial year. Finance Minister Piyush Goyal stated that he has put…

Science and Subterfuge in Economics Jayati Ghosh

Jayati Ghosh points out that “mainstream economics has operated in the service of power”, which has made the subject less relevant and reduced its legitimacy and credibility. Economics needs to become more open to criticism of assumptions, methods, and results. For full article Click Here (This article was originally published in the Project Syndicate on February 14, 2019)

Economic Crisis can trigger World War Jomo Kwame Sundaram and Vladimir Popov

Economic recovery efforts since the 2008-2009 global financial crisis have mainly depended on unconventional monetary policies. As fears rise of yet another international financial crisis, there are growing concerns about the increased possibility of large-scale military conflict. More worryingly, in the current political landscape, prolonged economic crisis, combined with rising economic inequality, chauvinistic ethno-populism as well as aggressive jingoist rhetoric, including threats, could easily spin out of control and ‘morph' into military conflict, and worse, world war. Crisis responses limited The 2008-2009 global financial crisis almost ‘bankrupted' governments and caused systemic collapse. Policymakers managed to pull the world economy from…

The Skewed Structure of India’s Bond Market C. P. Chandrasekhar and Jayati Ghosh

India’s efforts to activate its corporate debt market, not least by periodically raising the ceiling on investment by foreign portfolio investors in corporate bonds, are yet to succeed. Mobilisation of capital through the issue of corporate bonds has just about crept up to 4.4 per cent of GDP (Chart 1). Though that is much larger than the 0.2 per cent of GDP for mobilisation through new equity issues, it is way short of the figure (varying from 15 to 50 per cent) for most similarly placed emerging markets. Relative to the size of its economy, India’s corporate bond market is…

Budgetary Sops Will Do Little to Fix Unemployment and Poverty in India Sunanda Sen

The recent interim budget clearly reflects concerns that a majority of India’s people, especially in the agricultural and informal sector, have experienced hardship despite the on-going and relatively high growth in the economy. Palliatives designed to lessen these hardships include an annual grant of Rs 6,000, which is to be paid in three instalments to farmers owning land upto two hectares. Palliatives for the poor also include a rather unworkable plan of a contributory pension scheme of Rs 3,000 per month for workers in the informal sector. In addition to these two steps, the budget also offers substantial tax relief…

The Boundaries of Welfare Prabhat Patnaik

The Narendra Modi government has now carried its penchant for undermining institutions to the national budget itself. Not only has it treated what should have been an interim budget, as its tenure lasts barely two months into the new financial year, as a full-fledged budget, but it has also palpably refrained from applying its mind to several key budgetary schemes. The aim has been not to launch some seriously thought out schemes for the poor but to create hype-worthy news. Consider the three main “sops” of the budget. Twelve crore “small landholding families” are to be given Rs 6,000 each…