The Modi Years Prabhat Patnaik

In its attack on civil liberties, its restructuring of the State to effect an acute centralization of power, and its pervasive purveyance of fear, the Modi years resemble Indira Gandhi’s Emergency. But the resemblance stops there. In fact the two differ fundamentally in several ways. First, there were no lynch mobs, and street thugs, terrorizing people and giving them lessons in “nationalism” during the Emergency. It was only the State that repressed people then; but now we also have gangs of Hindutva hoodlums, who force critics of the government to apologize for their “misdemeanor”, with the additional threat of arrests…

The Abysmal State of Economic Decision Making Prabhat Patnaik

The minutes of the Board meeting of the Reserve Bank of India just prior to the announcement that currency notes of Rs.500 and Rs.1000 denomination were being demonetized are now available in the public domain, thanks to an RTI query. And what they reveal is the abysmal state of decision-making on economic policy that prevails under the Modi government. To be sure, economic decision-making has always been informed by class bias; but that is not what I am referring to here. Even when a decision is taken on the basis of the interests of the ruling classes, the argument for…

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,…

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 Apparent Enigma of Growth Prabhat Patnaik

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. And even if one may raise questions about…

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…

On the Proposal for A Universal Basic Income Prabhat Patnaik

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. This idea was mooted two years ago in the Government of India’s Economic Survey, though it was meant only for discussion and represented the views not of the government itself but rather of…

A Misleading Debate Prabhat Patnaik

For some time now there has been a debate in the country that is as esoteric as it is misleading, namely whether the Reserve Bank of India’s reserves should be drawn down by the government to finance its expenditure. On the one side, the argument is that if the government has to undertake extra expenditure, then, other things remaining unchanged, it would increase the fiscal deficit, while financing expenditure by running down the RBI’s reserves entails no such increase in fiscal deficit; since an increase in fiscal deficit is supposed to be bad for the economy, it follows that financing…

Criticism and Criticism Prabhat Patnaik

Former Reserve Bank Governor Raghuram Rajan has come out openly against the Indian government’s measure of demonetizaton 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 demonetization 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. At the same time however it provides an occasion to draw an important distinction. Since there can be no…