Wednesday, 31 January 2018

Helicopter money

The Bank of Japan is getting flak for not announcing it as part of its recent stimulus package. ‘Helicopter Money’ is an idea that is doing brisk rounds in global economic circles.

What is it? 
Helicopter money is an idea mooted by Milton Friedman in his paper ‘The Optimum Quantity of Money’ in 1969 for governments looking to lift their economies out of a slump. “Let us suppose that one day a helicopter flies over this community and drops an additional $1,000 in bills from the sky, which is, of course, hastily collected by members of the community. Let us suppose further that everyone is convinced that this is a unique event which will never be repeated.” Friedman’s theory was that the lucky citizens, thrilled with the windfall, would rush to spend. Higher money supply with no immediate change in output, would lift inflation. And improved consumer confidence would eventually prompt manufacturers to increase output and create more jobs, thus giving the economy a steroid shot to get it going.

Why is it important? 
In a bid to stimulate growth and fight deflation, governments have effected cuts in interest rates, turned to negative rates and unleashed many rounds of the infamous QE or Quantitative Easing. But GDP growth rates, whether in the US or Eurozone and Japan remain stubbornly low. Hence the recourse to more direct methods, like helicopter money.

Putting cash directly into the hands of consumers, it is hoped, will quickly kick-start a virtuous cycle of consumption that can boost up GDP. This is something that indirect QE, which transferred liquidity to banks in order to step up lending, couldn’t achieve. 

Of course, helicopter money, in today’s sophisticated world may not really have Phillip Hammond or Janet Yellen scattering bagfuls of cash from a helicopter. Instead, the British or American governments may decide to give tax refunds or tax credits or even make direct cash transfers to identified citizens. Some devious economists have even suggested pre-loaded smart cards with a certain amount of cash. If citizens don’t spend it within the specified time, the cash will simply disappear!

Why should I care? 
Sounds like a great idea! So when will the Indian government take to helicopter money to boost the economy? Alas, with the RBI watching over inflation and deficits like a hawk, this isn’t likely anytime soon. But we Indians can take comfort from the fact that we thought of helicopter money long before others did. MGNREGA paid cash to rural folk for 100 days of guaranteed work. In cases where that money went into benami accounts, that’s a form of helicopter money. On a more serious note, the excise duty cuts on cars and consumer goods announced in 2008-09 after the global credit crisis were a version of helicopter money too.

What about Pay Commission payouts? Well, strictly speaking, that cannot be termed helicopter money as it is recurring, and paid as reward for work. But these payouts can certainly serve the purpose of helicopter money.

The bottomline 
Helicopter money sounds wonderful, but it works only when people spend the money. Question is - will they hoard it?

While the developed countries have been fixated during the last decade on ways to put more money in people's pockets to stimulate demand, India without any due diligence decided to go the other way, and freeze out a bulk of its citizens' purchasing power by demonetisation. What was supposed to be a surgical strike against tax cheats and counterfeit currency became an attack on the large informal economy that ran on cash and carpet bombed the whole economy. The evil thinking was that about Rs.5,00,000 crores would not get deposited in banks by the people holding unaccounted money and the bonanza would be used recapitalize the banks saddled with NPA's. But in the end, almost all of the cash came back. There was absolutely no need to demonetize the economy in order to recapitalize banks. It's no coincidence that a new GST, implemented was supposed to create a common nationwide market by removing a complex web of local taxation. But when it became operational in July 2017, the single market became a side show, and the tax itself became an enforcement mechanism debacle. Like in the West, where a decade of monetary adventurism has altered people's portfolio choices and made risky assets frothy, India has reached the same end point, by flying the money helicopter in reverse. Unlike quantitative easing, which is a reversible stimulus for the demand side of the economy, India's cash ban and now the GST are seeking to permanently alter the supply side. An ebullient stock market is merely betting this experiment will succeed. But increasing the speed in wrong direction and expecting desired results is insanity.

Bill Gates, Steven Pinker and Philip Galanes

Excerpts from conversation between Bill Gates, Steven Pinker and Philip Galanes over a lunch of pizza and salad. Published in New York Times dated Jan 27, 2018.
  • You don’t want a tech company run by somebody in their 60s. At least I didn’t want to ... Bill Gates
  • Mr. Gates readily acknowledged that the person he is today is not one he would have recognized when he was in his 20s and single-mindedly building Microsoft. “I was a zealot,” he said. “I didn’t believe in weekends. I didn’t believe in vacations. I knew everybody’s license plate so I knew when they were coming and going. That was my life: doing great software.”
  • Given this wealth and our value system, what’s the highest-impact way to give it back? Melinda and I chose global health as our biggest issue, and U.S. education as our second one. And we’ve surrounded global health with agriculture and sanitation, family planning, antismoking. So, it’s a broad definition ... BG
  • For a young man in his 20s, writing software night and day may be the best way to add to human welfare ... BG
  • We have to resist the temptation to say that the fantastic good that’s done by foundations and innovators takes governments off the hook ...  Steven Pinker
  • The motto of the foundation is: “Every life has equal value.” But in truth, I want better things for my husband and my kids than for you ... Philip Galanes
  • When we give ourselves over to the law, we want it to be executed impartially. We gain stability. But if you could get your son off, of course you’ll try ... BG
  • Those under the influence of reason desire nothing for themselves that they do not desire for all humankind ... SP
  • But reason is not a powerful part of human nature. Innately, we favor family over strangers, our tribe over other tribes. It’s only when we convince others of the right way to act — that we conclude that all lives have equal value ... SP
  • There’s a tendency in journalism and political debates to assume that it’s easy to achieve a perfect society. But we have no right to expect perfection ... SP
  • Why throw money at the developing world? They’re just going to have more babies and be just as poor ... SP
  • I embrace more risk. Most philanthropists don’t take huge risks. If I didn’t have the success I had at Microsoft, I would never have the bullheadedness to embark on this project ... BG
  • The person who invents an affordable and efficient toilet should be made a saint ... SP
  • One of the biggest enemies of reason is tribalism. When people subscribe to an ideology, they suck up evidence that supports their preconceptions and filter out evidence that goes against them. And a move toward greater rationality would unbundle them and let evidence inform what the optimal policies ought to be. ... SP
  • Innovation drives progress, not Washington ... PG
  • Is AI going to proceed so quickly that work, which is something people worship, will suffer bad distributional effects, and people won’t know what to do? This is an unfortunate time for saying, “Take all your damn negative thoughts, and I’ll innovate away from them.” People are seeing difficulty with that argument ... BG
  • There are certain things that governments are always going to do better than private innovators. Basic research, for instance ... SP
  • All three sectors — philanthropy, which is about 2 percent of the economy; government, which is about 30 percent; and the private sector, which is the balance and largest by far — each have their role ... BG
  • Disease elimination is something that runs against people’s general pessimistic outlook. It’s amazing to think that polio might be gone. That one is pretty near ... BG

With advancing age, enlightenment is natural especially for people with book reading habit. The winner is who gets this at an early age and doesn't intimidate juniors and respect their rights.

Tuesday, 30 January 2018

Economic survey 2018

  • GDP is likely to touch 6.75% by the close of this FY. Far behind 8% of 2015-16. Remember GDP growth has nothing to do with well being of common man.
  • Tax base goes up but tax collections are lower.
  • Three year low oil price bonanza is over. The benefit was squandered away foolishly by Modi & Jaitley. Any further increase of oil price will not only slow does GDP growth but impacts inflation.
  • A $20 per barrel increase in oil prices will result in GDP growth slowdown by 1%, and a rise in inflation of 1%.
  • If high international oil prices persist or elevated stock prices correct sharply, provoking a ‘sudden stall’ in capital flows is likely.
  • In the medium term, the three areas that would require a policy focus including employment, education, and agriculture.
  • Further economic reforms like completing banks recapitalization, completing privatization of Air India.
  • The Sensex has risen 46%, during past 2 years, while economic growth and corporate profits have decelerated. This trend has largely been driven by expectations of a revival in growth and a sudden change in the savings pattern of households after demonetisation. A sharp correction cannot be ruled out in case future growth of the economy and corporate earnings do not remain in line with current expectations and stock markets could trigger "stall" in capital flows and force hikes in interest rates.
  • Due to climate change, annual agricultural incomes could reduce by 15-18% in irrigated areas and 20-25% in unirrigated areas. Higher investment needs to be made towards expanding irrigation with the implementation of efficient drip and sprinkler technologies. A plan to provide direct income support to farmers can be put in motion to replace inefficient agricultural subsidies. 
  • Although India's unemployment rate is around 3.5%, the unemployment rate in the 15-24 age group stands at 10.5%, as per ILO estimates. India has an abysmally low capacity to provide jobs to first-time workers. The only solution for India is to strengthen its manufacturing sector. 
  • Providing incentives to labour-intensive export sectors  will not only provide jobs but also implies higher current account surplus for the economy which can provide a cushion against swings in the global oil prices. Therefore, it would go a long way in reducing India's historical macro-economic vulnerability. 
  • Congress leader  Randeep Surjewala said that it has turned out to be much ado without direction, cohesion and vision. Modinomics had decoupled India's robust economy by myopic vision and the double whammy of demonetisation and ill-conceived GST. With one year to go for next general elections, Prime Minister Modi has plunged India's Economy towards despondency, dejection and dire straits.
  • Senior Congress leader P.Chidambaram said though the survey says growth rate for 2017-18 will be 6.75%, implying a second half growth rate of 7.5%, it offers little evidence in support of this claim. Causing 'agrarian distress' is the designed objective of the Modi government as the agriculture-GDP growth under the Modi government has plunged to just 1.9%, half of what was achieved in the first four years of the UPA. It is obvious that the government hopes that the private sector will come to the rescue of the economy. There is not much gas left in the government.
  • In a jibe at the government, Mr Rahul Gandhi tweeted, "The Economic Survey 2018 says, 'Acche Din' are here, except for these minor hiccups: Industrial Growth is (down). Agricultural Growth is (down). GDP Growth is (down) and Job Growth is (down). Don't worry Be Happy!" He also tagged a video of the song "Don't worry be happy" with the tweet.
Modi is in a fiscal bind. Revenue collection remains under pressure following the chaotic roll-out of a GST, and with an eye on next year's election, his spending priorities may turn to the distressed rural sector, putting pressure on the budget deficit. Even though government committed 3.2% budget deficit for this year analysts expect this at 3.5% this year and and 3.2% next year.

Economic upturn is defined as higher GDP growth over three consecutive quarters. Not every uptick which Modi's team bombard incessantly in media and social media. All these economic data doesn't mean anything really. Go to a village and talk to them or meet some frustrated unemployed youngsters in every street corner in the evenings and you will realize state of economy. Nearly 10% of voters for 2019 elections are first time voters in age band of 18-25 educated and/or skilled joined workforce but unemployed who have no knowledge of history or politics or bothered about GDP growth or corruption. Most of them are engaged in subsistence activities and are thoroughly frustrated. They would teach lesson to Modi and BJP in 2019 general elections.

The man who could not do any thing with Rs.4-5 lakh crores of oil bonanza money in 3 years except resorting to wild gambling what can he do now with no money, non performing economy and almost all sectors in distress. Corruption is not the only high priority item in our country. The priority items are healthcare, education, unemployment, agrarian distress, and many more after which corruption control and bullet train comes. Unfortunately for our flamboyant PM style, spectacle and display alone matters and nothing else. Modi has made a hash of anything and everything. The worst PM ever in history of India. The only way to show performance is to create wrong data and that is what exactly he and his gang are doing.

77% of workforce will be In vulnerable employment By 2019

  • In the recent past a report indicates the falling value of wage labour against the accumulation of wealth as dividends and share capital. Another report hints towards the dismal conditions in which Indian workers are forced to work and eke a living.
  • An ILO report estimates that over 77% of the active workforce (not counting the unemployed) will be in vulnerable employment by 2019. ‘Vulnerable employment’ is defined as as self-employed without paid employees and contributing family workers. In India ‘vulnerable employment’ encompasses contractual workers in the organised sector and workers in the unorganised sector. 
  • Grave conditions exist in which the workers, producing high value branded garments, are forced to work in Bangalore. It also reports that women are lured by false promises of wages and held under pressure to work for low wages.
  • A major labour reform is being pushed by the corporate sector to formalise the contract labour system that enables ‘fixed-term employment’ by industries. The new labour rules would allow the companies to shift the risk of the business cycle on the workers. This allows companies with less than 300 workers to close down or retrench workers without prior notice and approval. Presently in most states, the limit is set at below 100 workers.
  • The complex tax regime with multiple exemptions leads to a skewed burden of taxes. It identifies that apart from allowing larger companies to pay a much lower rate of tax than smaller companies, exemptions for accelerated depreciation incentivises capital-intensive production rather than the use of labour. The effective tax rate for companies with turnover less than Rs. 1 crore is above 30% while companies that make over Rs. 500 crores pay less than 26% in taxes.
  • The UK - India Business Council (UKIBC) and the Confederation of British Industry have together written to the Indian government seeking a lowering of corporate taxes and implementing reforms to further dilute labour laws. The lobby groups have argued that such measures would improve the ease of doing business in India and also help increase British investments in India.
  • The workers had been working in abysmal conditions for meagre wages ranging from Rs. 6000/- to Rs. 10000/-. The reasons for accidental deaths go beyond violations of norms but is more systemic. Women suffer disproportionately as they are exposed to informal work. A labour activist points out that labour laws are brazenly violated.
  • Trade unions have staged demonstrations and road rokko in various cities of Tamil Nadu voicing their dissent against the central and state government’s economic policies. The demands included a raise in minimum wage to a living wage, end to contractualisation and ‘anti-labour’ policies, the protests focussed on price rise, hike in transport fares in Tamil Nadu and the dismantling of the Public Distribution System which has been the hallmark of the welfare system in Tamil Nadu.
  • Belying the opinion that India is creating far fewer jobs (or even bleeding jobs), a new report, published by a professor of economics at IIM Bangalore and Chief Economic Advisor of SBI, has concluded that we are headed towards creating 7 million (70 lakh) jobs by the end of the financial year 2017-18. This has led to a furious debate over the issue of job creation in India in the last few years.
  • The biases that could have crept into the data is that the threshold of 20 employees for EPFO registration might lead to a false growth when a company that has 19 workers increases its payroll by 1. While the net increase is just 1, EPFO will record a growth of 20. It also does not delete accounts immediately when jobs are lost. An amnesty scheme announced two years back has brought in many workers into the ambit. This cannot be claimed as new employment. Thus, EPFO is not the best source to estimate net growth in jobs. 
  • It is argued that at a time when the economy has been jolted by shocks such as Demonetisation and GST implementation that have adversely affected the unorganised sector, it cannot be ‘wished away’ by cherry-picking data. 

The attitude of our central & state governments to dole what ever concessions MNCs ask to set up their manufacturing units in the name of generating some jobs and indirect economic benefits is fundamentally defective. These industries apart from tax concessions will have to be given land at throw away prices ruining the poor farmers but also precious resources like water & electricity are to be diverted for their use. The pollution and climatic impact and industrial waste dumped in our land fills is incalculable. The cultural impact is another thing. If these negatives are loaded to the benefits, the net benefit would be negative. Labor reforms exposing workers to be exploited by these industries is nothing but height of insanity. Unlike IT employees these workers whenever they are retrenched getting alternate jobs wouldn't be easy and the agony they and their families undergo in the absence of robust social security is unimaginable. Therefore we should do what ever is good for our society especially poorer classes. No point in solving one problem and creating a much bigger problem.

Sunday, 28 January 2018

Indians are worse off under Modi

Prime Minister Modi should spend less time abroad telling foreigners how well India is doing and more time at home asking people how they feel about his administration.

  • Only 3% of Indians consider themselves thriving in 2017 compared to 14% in 2014.
  • India’s largely rural population initially led the decline in life evaluations, with thriving dropping from 14% to 7% between 2014 and 2015, and edging even lower to 4% and 3% in the years after that.
  • Declines among urban Indians have been much more gradual, although they are down in the past year, dropping from 11% to 4%.
  • Modi’s policies have yet to touch the masses. Living wage for family in India remains almost flat in the Rs.17,300-17,400 per month range over his tenure. 
  • Wages paid to low-skilled labor decreased to Rs.10,300 per month in 2017 from Rs.13,300 per month in 2014.
  • There is the persistence of corruption, the rise of nonperforming loans in state-owned banks, high taxation, poor public health, and chronic income inequality — something that Modi inherited from previous administrations. All these explains the misalignment between the high hopes of the Indian people for their economy and what they are personally experiencing.
  • The people had high expectations, and those expectations have not been satisfied. GDP growth is still above 5%, but it has slowed down sharply from past rates of 8 and 9%.
  • The above 5% GDP growth is not creating jobs. There’s this phenomenon of ‘jobless growth.’ India is demographically quite a young nation. And the young people are entering the labor force at too fast a rate compared to job creation. These young people are getting frustrated.

When people see their lives headed in the wrong direction, they want change. That should be of great concern to Modi.

Selling pakodas is not employment

Answering a question on employment during an interview with Zee TV telecast on Jan 20, 2018, Prime Minister Narendra Modi asked, "If someone opens a 'pakoda' shop in front of your office, takes home Rs 200 at the end of the day, does that not count at employment?"
  • The fact that the prime minister actually celebrates this kind of ’employment’ as a major success of his Mudra scheme is even more worrisome.
  • Earning a meagre Rs 200 a day may come as solace to an unemployed person, the government must acknowledge that it only reflects under-employment and these earnings are just not enough to live life with dignity.
  • Niti Aayog noted that “not unemployment, but severe under-employment is the main problem facing the country” and that “what is needed is the creation of high-productivity, high-wage jobs”. Prime Minister himself heads Niti Aayog.
  • 90% of the Mudra scheme loans to over 10 crore beneficiaries in last three years were under the ‘Shishu’ category averaging Rs 43,000. With such a low degree of investment provided to nearly nine crore Indians, the employment opportunities can hardly be of high value.
  • Banks reported a 47% increase in non-performing education loans between March 2015 and March 2017 and the bad loans have doubled. The defaults in education loans are a direct result of poor availability of good jobs. 
  • In equating the success of low-value Mudra loan disbursement with generation of employment, the prime minister has sought to shift the goalpost on employment creation.
  • The failure of the flagship programmes i.e. Start Up India, Stand Up India and Make in India schemes has forced the prime minister to yet again shift the goal post. The objective and success of the government is no more in addressing the concerns of an aspiring India, but to provide meagre income enough to earn ‘do waqt ki roti’. For an individual who is unemployed due to any reason, be it demonetisation or global distress or lack of adequate manufacturing and agricultural growth, any income that sustains his daily meals may be a matter of solace. But the prime minister of India cannot and should not take pride in it.
Under-employment is accompanied with the economic costs of social and family distress, health problems, impact on education etc – the head of the government cannot be oblivious to this. His vision has to accommodate the economic costs of under-employment. He does not have the luxury of looking at the economy only from the view point of a common unemployed citizen. That’s why the success of Mudra does not automatically translate into success for India’s economy and is why earning 200 rupees a day by selling pakodas cannot be considered a happy state of affairs.

70 lakhs jobs in 2017 - a blatant bluff

Prof Pulak Ghosh and Dr Soumya Kanti Ghosh created a minor storm when they claimed that 70 lakh new ‘payroll’ jobs will be created in India in the organised sector in 2017-18. They reported that the EPFO manages a corpus of over Rs 11 lakh crore for its 550 lakh subscribers. According to the authors, 45.4 lakh new subscribers in the age band 18-25 years had enrolled under the EPFO in 2016-17 and started making their monthly contributions to the Fund. They also found that 36.8 lakh new subscribers in the same age band had enrolled between April and November 2017 and, therefore, they estimated that, for the full year 2017-18, 55.2 lakh new subscribers would be enrolled.
  • Seventy lakh new jobs is a claim that will take one’s breath away. The total ‘payroll’ stock as on March 31, 2017, was 919 lakh. It has taken the country 70 years to create a ‘payroll’ stock of 919 lakh jobs but, miraculously, in just 12 months, the country will generate 70 lakh new ‘payroll’ jobs — that is nearly 7.5 per cent of the current stock!
  • By comparison, China with a GDP five times that of India, adds about 150 lakh jobs a year.
  • If organised sector that employs 20 or more persons can generate 55 lakh new jobs in a year that qualified for enrollment under the EPFO, then we can declare that India has truly and comprehensively slain the demon of unemployment!
  • If we assume that for every ‘payroll’ job counted by the authors there will be another job created in the informal sectors, then the count will rise to 140 lakh in 2017-18. According to the Ghoshs’ report, 150 lakh persons enter the labour force every year of which 66 lakh is skilled manpower. Soon, the problem will not be joblessness but lack of jobseekers!
  • The authors also pointed out that the limited data available in the public domain indicated that the number of contributing members in the EPFO grew by 7% in 2014-15 and 8% in 2015-16 but, according to the Ghoshs’ report, the number jumped by 20% in 2016-17 and by a further 23% up to December 2017.
  • The EPFO data indicates that the number of contributing members decreased from 4.62 crore in July to 4.38 crore in September this year (2017).
  • The PM Modi referred to the MUDRA scheme and said “over 31 million loans have been sanctioned to entrepreneurs. Even if conservatively each enterprise creates one sustainable job, this initiative itself amounts to 31 million new jobs.” Alas!
  • It seems Modi is intentionally confusing by mixing up self employment' as jobs and misleading. While a 'job' is certain, regular and reasonably secure, self employment is not. What we are talking about is jobs in formal sector.
  • If we equate self employed, under employed and casual employed as job holders, then there is neither unemployment nor joblessness.
  • Labour participation rate is a ratio of all adults willing to work, whether employed or unemployed, to the total population. This ratio was 48% in Jan 2016. It fell to below 45% in Nov 2016. Now it reached 43% in July 2017. Most Indians choose not to work. Low labour participation rate hinders economic growth. Labour participation rate in China is 71%. The world average is 63%. Other major countries are Indonesia with a labour participation rate of 67%, Pakistan (54%), Nigeria (56%), Bangladesh (62%) and Philippines (65%).
  • The 70 lakh jobs claim, as claimed by Modi, is not only a misleading boast but also a blatant bluff.

PM Modi’s recent assertion that a person earning Rs 200 a day by selling pakodas is also employed. The fact that the prime minister actually celebrates this kind of ’employment’ as a major success of his Mudra scheme is even more worrisome. It is not a pride that millions are managing to eke out a meagre income. Instead it should be seen as a sign of under-employment.

India is witnessing jobless economic growth during the past three years and the government doesn't know how to create jobs and hence making all false claims and propaganda. Demonetization and GST's faulty roll out have had destroyed informal sector employment. MNREGA was able to provide just 50 days of work against guarantee of 100 days. Mudra loans aimed at promoting  micro enterprises averaging Rs.43,000 is just useless and serves very little purpose. We all know that politicians speak lies, nothing but lies but we do expect Prime Minister to be truthful to the nation.

Saturday, 27 January 2018

Life lessons

  1. We must love.
    It’s better to have loved and lost than never to have loved at all. It’s a truth so profound we can discuss it only with aphorisms. Yes, we must love, even if it breaks our hearts—because, unless we love, our lives will flash by.
  2. Love isn’t enough.
    Although we must love, love is not enough to survive. We must take action to show others we care, to show them we love.
  3. Happiness is not for sale.
    We can’t buy happiness. The stuff won’t make us happy. At best, material things will temporarily pacify us. At worst, they will ruin our lives. They will leave us empty, they will leave us depressed, and they will leave us even more alone.
  4. Success is perspectival.
    Success is neither amassing wealth nor possessions. Having a six-figure job, the house with too many bedrooms, the luxury car, the tailored suit, the expensive watch, the big screen TV, and all the trappings of the material world would seem make you look successful. These things can make your family and friends proud of you but that is not success. All these luxuries are not luxuries after using them 20 times.
  5. Make change a must.
    I didn’t have the feeling in my gut that things must change. I knew they should change, but the change wasn’t a must for me, and thus it didn’t happen. A decision is not a real decision until it is a must, until you feel it on your nerve-endings, until you are compelled to take action. Once your shoulds have turned into musts, then you are ready for change.
  6. The meaning of life.
    Giving is living. The best way to live a worthwhile life is simple. Continuously grow as an individual and contribute to other people in a meaningful way. Growth and contribution is the meaning of life.
  7. Health is underestimated.
    Our well-being is more important than most of us treat it. Without health, nothing else matters.
  8. Sentimental items are less important.
  9. Your job is not your mission.
    There’s nothing wrong with job and hard work, as long as it doesn’t get in the way of life’s more important areas like health, relationships, passion.
  10. Finding your passion is important.
    Passion is not preexisting. You can cultivate a passion that aligns with your principles and desires.
  11. Relationships matter.
    Every relationship is a series of gives and takes. For the relationship to work, both people must contribute to and get something. If you just give but don’t get, you’ll feel used, exploited, taken advantage of. If you only take but don’t give, you’re a parasite, a freeloader, a bottom-feeder.
  12. You don’t need everyone to like you.
    We all want to be loved but you can’t value every relationship the same. You can’t expect everyone to love you the same. Life doesn’t work that way. When people don’t like you, nothing actually happens. The world does not end. You don’t feel them breathing down your neck. In fact, the more you ignore them and just go about your business, the better off you are.
  13. Status is a misnomer.
    Similar to success, our culture places an extraordinary emphasis on material wealth as a sign of true wealth, and yet too many people of  “status” are miserable. They don’t seem wealthy. One’s true worth is not determined by his or her net worth.
  14. Jealousy is a wasted emotion.
    Competition breeds jealousy, although we give it prettier labels like “competitive spirit,” or “ambition.” Jealousy is ugly. It is never a way to express that we care. It’s only a channel through which we broadcast our insecurities.
  15. Everybody worships something.
    There is no such thing as not worshipping. Everybody worships. The only choice we get is what to worship.
  16. I am not the center of the universe.
    It’s difficult to think about the world from a perspective other than our own. We are always worried about what’s going on in our lives. Why am I not happy with my life? We are strongly aware of everything connected to our lives, but we are only one ingredient in a much larger recipe.
  17. Awareness is the most precious freedom.
    Minimalism is a tool to rid ourselves of excess in favor of a deliberate life. It is a tool to take a seemingly intricate and convoluted world, cluttered with its endless embellishments, and make it simpler, easier, realer. It is unimaginably hard to remain conscious, attentive, and aware. It is difficult not to fall back into a trance-like state, surrounded by the trappings and obstructions of the tiring world around us—but it is crucial to do so, for this is real freedom.
  18. Be on the mountain.
    This term as a metaphor means for living in the moment. When you climb to the peak, don’t immediately plan your descent. Enjoy the view. Be on the mountain. Just be.
  19. We are scared for no reason.
    We are often scared of things that don’t have a real effect on our lives (or that we can’t control, so we’re worrying for no reason).
  20. Change is growth.
    We all want a different outcome, and yet most of us don’t want any change in our lives. Change equals uncertainty, and uncertainty equals discomfort, and discomfort isn’t fun. But when we learn to enjoy the process of change—when we chose to look at uncertainty as variety—then we get to reap all the rewards of change. That is how we grow.
  21. Pretending to be perfect doesn’t make us perfect.
    I am not perfect, and I never will be. I make mistakes and bad decisions, and I fail at times. I stumble, I fall. I am human—a mixed bag, nuanced, the darkness and the light—as are you. And you are beautiful.
  22. The past does not equal the future.
    My words are my words, and I can’t take them back. You can’t change the past, so it’s important to focus on the present. If the past equaled the future, then your windshield would be of no use to you. You would simply drive with your eyes glued to the rear view mirror. But driving this way—looking only behind you—is a sure-fire way to crash.
  23. Pain can be useful, but not suffering.
    Pain lets us know something is wrong: it indicates we must change what we’re doing. Suffering, though, is a choice, and we can choose to stop suffering, to learn a lesson from the pain and move on with our lives.
  24. Doubt kills.
    The person who stops you from doing everything you want to do, who stops you from being completely free, who stops you from being healthy, happy, and passionate—is you.
  25. It’s okay to wait.
    Sometimes it’s okay to wait a little longer for something. Why rush if you don’t have to? Why not enjoy the journey?
  26. Honesty is important.
    Honesty, at the most simple level, is telling the truth—not lying. It’s supremely important to be honest, and it’s hurtful when you’re not.
  27. Openness is just as important as honesty.
    Openness involves being honest while painting an accurate picture, shooting straight, not misleading other people, and being real. Openness is far more subjective, and you must be honest with yourself before you can be open with others. This doesn’t mean you must put your entire life on display. Some things are private, and that’s okay, too.
  28. Getting people’s buy-in.
    Adding value to other people is the only way to get their buy-in. That’s how you get their buy-in.
  29. Hype is cancerous.
    So often we fall for the hype (“Buy More, Save More!” and “Three Day Sale!”), and we are suckered into rash buying decisions because of scarcity and a false sense of urgency. We can train ourselves, however, to not only resist such hype, but to have a vitriolic reaction to the hype that we avoid anything that’s hyped. 
  30. I’m still trying to figure it all out.
    I don’t intend to promulgate my views and opinions as some sort of maxims by which you should live your life. What works for me, may not work for you. Hell, sometimes it doesn’t even work for me.

More lessons:
  1. It’s not about how people feel about you, but how you make them feel.
    Growing older has shown me the cool kids aren’t always the happy kids. I realized what people think about you isn’t nearly as important as how you make them feel.
  2. Consider all advice.
    It’s amazing how much smarter our parents appear as we we get older. In many instances, if I had listened to my parents’ and grandparents’ advice, I could have avoided learning lessons the hard way. I told myself that even if I didn’t agree with what someone was telling me, I would at least consider their advice. This has forced me to look into the mirror to consider what I must change.
  3. Happiness comes from within.
    Happiness comes from within, not from the things we own.
  4. You’ll never be happy with more until you’re happy with what you have currently.
    It’s as simple as that. I discovered I usually don’t get rewarded in life with more until I appreciate what I have currently.
  5. Forgiveness is incredibly important.
    There is a profound saying in the bible: “Freely forgive others as you forgive yourself.” When I learned how to let things go and easily forgive others, I was a much happier person. In fact, I found the bigger the wrong I forgave, the better I felt.
  6. You can count your closest friends on one hand.
    As you grow older you find out who is actually your friend and who isn’t.
  7. Being honest is always the right thing.
    Even when I have royally screwed up in life, I have found honesty punishes me less and gains trust more.
  8. If you lie, you will get caught.
    If you lie, you will probably have to tell more lies to cover up the original lie. It’s a vicious cycle.
  9. Although honesty is important, I don’t have to be completely transparent.
    Just because something is true, I don’t have to say it. I needn’t spew forth every thought that enters my head.
  10. People are inherently good.
    Even the people who’ve treated me poorly are still good at some level. None of us are perfect. This has helped me be less cynical.
  11. Slow down.
    We all need to slow down, breathe, and pace ourselves when we get overwhelmed.
  12. Friendly people at work aren’t necessarily your friends.
    Be careful whom you open up to at work.
  13. Stay true to yourself.
    If it doesn’t feel right, if it doesn’t feel good, if it doesn’t feel like you—then don’t do it. I’m much happier when I follow this advice.
  14. Every decision matters.
    Every decision we make affects our future. There is no such thing as a zero-sum decision.
  15. There is no such thing as a free lunch.
    Every decision we make costs us something: be it time, emotion, money, etc.
  16. “Act as if…”
    Be the change in the world you want to be. Either way, this line has helped me throughout my life.
  17. “No one can make you feel inferior without your consent.” —Eleanor Roosevelt. 
    You needn’t care what people think or say about you. What they say or think is only true if you believe it’s true. Don’t let anyone get the best of you.
  18. Some of life’s most profound advice is found in platitudes.
    “You can be anything you want to be,”
    “Life’s too short,”
    “Time heals all wounds,”
    “Good things come to all those that wait,” etc.
    Don’t dismiss it just because it’s a platitude.
  19. Don’t sweat the small stuff.
    It’s easier for me to avoid jealousy, it’s easier for me to forgive, and it’s easier for me to overlook the negative things in life.
  20. It’s all small stuff.
    Until you have a few life-changing experiences, this isn’t clear. I have had a few close calls with myself, friends, and family which have shown me how small my problems are.
  21. If you don’t take care of your health, it will fade fast.
    I don’t think I need to articulate this one any more. 
  22. Relationships are important.
    Don’t burn a bridge with another person if you can avoid it. You never know who will decide your fate.
  23. Live life with passion.
    If I didn’t have passion in my life, I would be bored to death. If you’re bored, focus on your passions. If you don’t have time for your passions, make time.
  24. If you’re not growing, you’re dying.
    If you’re not growing in life, you are simply living out your days.
  25. Contribute.
    Contributing to someone else, or to a community, will make you feel good. Contribution is what makes me feel the most alive. Contributing to others keeps me going, gets me up in the mornings, and continues to inspire me.
  26. In twenty years you will regret the things you didn’t do more than the things you did do.
  27. Life is happening now!
    Don’t forget to live life in the moment.
  28. Learn to let go.
    This was a hard lesson but it serves true. Sometimes it’s just better to let things go. 
  29. Everything changes.
    Things don’t look different day-to-day, but when you look back ten years it’s all different. Change is an absolute, and we should plan accordingly. Don’t fool yourself.
  30. Procrastination is useless.
    I realized that no matter how long I put something off, it’s still there the next day. 

Friday, 26 January 2018

Luck is more important to success

“If you’ve been successful, you didn’t get that on your own,” President Obama declared years ago at a campaign rally. “If you’re successful, somebody along the line gave you some help.” In America, the belief that hard work and a touch of grit is all one needs to succeed. Talent and drive can take you a long way, but it’s often not enough. Luck is as important.
  • Most Americans underestimate the role of luck in economic success.
  • The current American tendency is to overlook the role of luck as a cultural bias and Americans are less likely than Europeans to favor high taxes on the rich and generous benefits for the poor.
  • Conservatives have a narrative about success, which prioritizes hard work and skill. Liberals have an alternative narrative about success, which prioritizes structural constraints and privilege. Neither one is entirely right, but it does seem that liberals are closer to the truth.
  • People who amass great fortunes are almost always talented and hardworking. But it is also true that countless others have those same qualities yet never earn much. 
  • Chance plays a much larger role in important life outcomes than most people imagine.
  • The rich underestimate the importance of luck in success and why that hurts everyone, even the wealthy.
  • In this world dominated by winner-take-all markets, chance opportunities and trivial initial advantages often translate into much larger ones and enormous income differences over time. 
  • Luck is as important as hard work in becoming successful.
  • Fortune favors the fortunate. And not acknowledging that can have unlucky consequences.
  • People who succeed on a grand scale tend to believe they did it all by themselves. They think that whatever dollars came their way are theirs to keep. If the government tries to tax it, they regard it as theft. 
  • Believing that all the good fortune that came your way was earned in the traditional sense is a very difficult claim to sustain once you look at how the competitions unfold and the role chance events play in all our lives.
  • Ethically speaking, we have no control over the most important determinants of our lives. Even if you think you succeeded purely on the basis of talent and effort, where do you think you got your talent? Where do you think that inclination to work hard comes from? These are things determined by genes and upbringing and it's quite ludicrous to claim moral credit for them.
  • Privilege has a way of blinding the privileged. People born into good fortune can’t appreciate how much of their success stems from the care and attention and resources they received at every stage of their development.
  • You're probably not going to succeed if you don't get really good at work and effort. You shouldn't expect and wait with hope that lightning strikes. Tell people to try to deserve whatever it is that they want. That doesn't mean you'll get it, but you're certainly not going to get it if you don't deserve it.
  • We really need to make the investments where the environment is conducive for talented and hard-working chances of succeeding. In America it was always true that if you work hard and are good, you may not be a spectacular success, but you'd most likely prosper to a reasonable degree.
  • Rich people could pay more taxes and scarcely feel it, but nobody thinks about it that way.
Markets are not perfectly meritocratic. They're more meritocratic now than ever before in the past. Privilege always matters. Most of the people who emerge as big winners today do tend to be talented and hard-working, so there's at least a semblance of meritocracy. What's also true is that being hard-working and talented are by no means sufficient to get you into the winner's circle. Luck matters a great deal.

Luck is far more important to success in this life than we imagine.
 Things we're not entitled to claim moral credit for are the driving forces 
behind success ... Robert H. Frank

Extreme wealth is indefensible

What is difficult to understand about those who make millions of dollars a year is why they ever need that kind of money for? Who could ever use that much? What are they even spending it on? Why do they actually want it?
  • These people live like monarchs. They live in almost ludicrous luxurious excess.They make no effort to curb their consumption. 
  • When they want something, like a piece of designer clothing or a fancy dinner, they simply buy it. An expensive meal does not require an occasion. If the family wants to go out to a pricey restaurant, they just do it.
  • They don’t have to do household chores. Everything is taken care of by the housekeeper, gardener, housemaid, driver etc. It is difficult to fathom living like this.
  • Yet most of their income still just gets tossed into their savings account. This is truly extraordinary. 
  • Whether increased taxes on the wealthy will have useful consequences is arguable. What is unimaginable is that increased taxation would deprive these people in any serious way.
  • These people donating to charities may not exceed 1% of their annual income. It’s almost as if they care far more about feeling like they are charitable than actually being charitable.
  • They rarely encounter criticism for the moral aspects of this kind of life. In wealthy circles, everyone has a strong interest in allowing each other to feel like they are good people. So if one person mentions about their donating to charities, the friend is unlikely to criticize. Rarely do elites tell other elites that it is wrong to be an elite, for obvious reasons. 
  • And the most contact this person has with the working class probably comes during chance encounters with the pool man, who is unlikely to voice any judgment he may secretly hold about their decadent bourgeois habits.
  • Even $400,000 annually is far too much to live on. It is very difficult to even grasp the amount of money possessed by the 20 people who own more than half the country’s wealth. If it takes a lot of effort to fritter away $400,000 each year, imagine how the billionaires struggle to think of things to buy. That’s why their spending becomes outright ludicrous. Once you go past the first million, there’s not really much more pleasure you can buy, so you have to resort to nonsense.
  • The tax policy implications are debatable. But it’s uncontroversial to conclude that the possession of enormous wealth, especially in a time of great suffering, is just indefensible in every way. Even $400,000 a year provides enough to live in extreme luxury. Anything over that is just obscene. 
  • Risk-taking investors deserve higher returns, but actual returns do not necessarily reflect merit. The determining quality of  billionaires is to be lucky -- the other qualities being necessary but not sufficient. And luck is not meritocratic.
Inequality does not cause poverty. Capitalism has resulted in much more economic inequality in China, but much less poverty. Studies have shown that lower taxes for the wealthy don't necessarily result in increased economic growth. Extreme wealth contributing to inequality were seen as irrelevant and a prerequisite for the growth that would also help the poorest, as the wealth created trickled down to the benefit of everyone. But rather than creating jobs and lifting others out of poverty super-rich minorities cause social unrest and depress demand for goods and services, limiting growth and innovation as a result. Extreme wealth causes extreme inequality that impedes poverty alleviation, slows economic growth, compounds gender inequality, drives inequality in health and education outcomes, undermines economic mobility over generations, fuels crime, undermines social cohesion, and harms democracy.

That man is rich, whose pleasures are the cheapest ... Henry David Thoreau
Honesty is incompatible with amassing a large fortune ... Mahatma Gandhi 

At least 50% of the world’s billionaire wealth is non-meritocratic owing to either inheritance or a high presumption of cronyism. Another 15% is not meritocratic owing to presumption of monopoly. All of it is non-meritocratic owing to globalization. By contrast, crime and technology are found to be negligible sources of extreme wealth. The argument that "These eight billionaires, through the salaries and stock paid to their employees and the stock owned by millions of shareholders, have made millions of people rich and improved the lives of billions of people through the use of their products. They have not made anybody poor." is fine but governments must tax them at higher tax rates and spend the proceeds for accelerating eradication of poverty. These billionaires have a greater obligation for contributing for this cause. 

Wednesday, 24 January 2018

Dashrath Manjhi breaks a mountain


  • Dasarath Manjhi (1934-2007), an illeterate daily wage earner, shot into limelight after he constructed a 360 feet long, 30 feet high and 25 feet wide passage through Gehlour hills with a hammer, chisel and nails working day and night for 22 years from 1960 to 1982. His feat reduced the distance between Atri and Wazirganj blocks of Gaya district (Bihar) from 55 km to just 15 km, bringing him international acclaim.
  • He resolved to build the road after his wife, Falguni, died of injuries on the way to the hospital in Wazirganj.
  • Dashrath Manjhi belonged to Bihar’s Musahar community, nearly 98% of them are landless and not even 1% of them are literate, which makes them the community with the country’s lowest literacy rate. 
  • After finishing his epic project he met the brass of the state administration with a request to construct a metalled road through the mountain.
  • When Manjhi had met Nitish Kumar at a janata durbar in July 2006 in Patna, Nitish Kumar stood up in reverence to the man with Himalayan resolve and made him sit on the Chief Minister’s chair. 
  • The state government had allotted a five-acre plot to Manjhi in Karjani village, which he donated for construction of a hospital. The government had recently announced to name the hospital after Manjhi. Everybody is now waiting for the six-bed Dasrath Manjhi Hospital to open in Dasrath Nagar. An additional public healthcare centre providing OPD services at Gehlaur is all that they have in the name of medical care.
  • The mountain man’s only son and daughter in-law are handicapped and the family lives in abject poverty. For his own family, Manjhi could do nothing more than procuring an Indira Awaas Yojna unit.
  • Dashrath Manjhi, the septuagenarian ‘mountain man’ ['pahad purush' to locals] of Gehlour died at the AIIMS, New Delhi in 2007 from cancer of gall bladder. When he died at 73, Chief Minister Nitish Kumar had reached his village to receive his body and offered a state funeral. 
  • In Manjhi’s own words, "What I did is there for everyone to see. When God is with you, nothing can stop you. I will keep working for the development of the villages here so long I am alive. I am neither afraid of any punishment from any government department for my work nor am I interested in any honour from the government".
  • "It is a sad story. A state that spends millions of rupees for decoration of ministers' houses failed to fulfil his dream of building a metalled road through the mountain," said Arun Singh, a journalist who first discovered Manjhi in the 1990s. "Manjhi died a frustrated man. His work was neither recognised nor awarded. But people will remember him and his story will inspire many," Arun Singh, who knew Manjhi for over a decade, told.
Shah Jahan built the Taj Mahal for his beloved wife Mumtaz, the world's greatest monument of love. Thousands of labourers took more than 20 years to build the Taj Mahal. Dashrath Manjhi' monument of love may not be as beautiful, but is more awe-inspiring than Shah Jahan's feat. 


If the mind is intensely eager, everything can be accomplished.
Mountains can be crumbled into atoms .. Swami Vivekanda

Eventhough Manjhi was breaking mountain out of his intense love for his wife, he was also making a huge contribution to his fellow villagers who stands benefited of his arduous work. It is so much easy to appreciate but so much difficult to do that too day & night for 22 years. Manjhi's work is second only to the Chinese man Liu Guojiang after he spent 56 years of his life building a 6,000-step mountain staircase for his wife's convenience, although she doesn’t go down the mountain that much.. In 2001, a group of adventures were exploring the forest, they surprisingly found the elderly couple and the over 6,000 stairs of hand carved ladder.

Reward work, not wealth

Deccan Chronicle | Jan 23, 2018
The year 2017 saw the billionaires increase their wealth by $762bn. There are now 2,043 dollar billionaires worldwide. Nine out of 10 are men. This huge increase could have ended global extreme poverty seven times over. 82% of all wealth created in the last year went to the top 1%, while the bottom 50% saw no increase at all. Poorly paid work for the many is supporting extreme wealth for the few. Women are in the worst work, and almost all the super-rich are men. Governments must create a more equal society by prioritizing ordinary workers and small-scale food producers instead of the rich and powerful.
  • We have an economy that serves the interests of the 1%. If we want to heal our fractured and unstable world, we need to change course fast.
  • In 2016, annual share dividends received by super rich are several billions of dollars. Whereas Anju works sewing clothes in Bangladesh for export. She often works 12 hours a day and has to skip meals because she has not earned enough money. She earns just over $900 dollars a year.
  • Inequality crisis is real. In many countries wage inequality has increased and the share of labour compensation in GDP has declined and profits have increased more rapidly. 
  • Even in emerging countries with rapid economic growth, many workers, including a disproportionately large share of women, remain trapped in low pay and poverty wages.
  • This is in contradiction to goal 10 of UN 2030 Agenda of Sustainable Development Goals that calls to ‘reduce inequality within and among countries’ and Goal 8 calls for inclusive economic growth, full and productive employment and decent work for all. The key to reducing inequality is ‘well paid, decent work'.
  • The super-rich call this ‘stoking class warfare’ but the truth is that in many societies the super rich have in effect declared war on the poor. The urgent need is to rebalance the tables, defend the rights of the poor, and re-establish fair societies that meet the needs of all.
  • The recipe for reducing inequality is simple. A minimum wage on which you can live, social protection and companies’ compliance with human and labour rights. Freedom of association and collective bargaining rights are fundamental enablers. Governments must act. Companies must face up to their responsibilities. The global economy will falter with too many billionaires. An economy for working people, not wealthy owners will end the inequality crisis.
  • Brazen corporate tax evasion, privatization, service cuts and decades of stagnating wages have not happened by accident. Radical action is needed to fund universal public services, decent work and redistribute wealth to avoid continued rise of populism and racism of the far right.
  • People need wages that they can live on with dignity. But uncontrolled corporate greed is accelerating inequality and insecurity. More widespread collective bargaining would re-balance the global economy so it works for everyone, not just the 1%. It’s time for governments to act.
  • The current levels of extreme inequality far exceed what can be justified by talent, effort and risk-taking. Instead they are more often the product of inheritance, monopoly or crony connections to government.
  • Monopolies fuel excessive returns to owners and shareholders at the expense of the rest of the economy. 
  • Approximately two-thirds of billionaire wealth is the product of inheritance, monopoly and cronyism. Despite hard work, it is difficult or impossible for ordinary people to increase the money they have.
  • Ever-increasing amounts are being returned to wealthy shareholders, fueling a relentless squeeze on workers.
  • The fortunes of the richest are often boosted by tax dodging by rich individuals and by the corporations of which they are owners or shareholders. Using a global network of tax havens the super-rich are hiding at least $7.6 trillion from the tax authorities. This means the top 1% is evading an estimated $200bn in tax.
  • Billionaires who have made their fortunes in competitive markets are often doing so by driving down the wages and conditions of workers, forcing countries into a suicidal race to the bottom on wages, labour rights and tax giveaways.
  • The poorest children, and especially the poorest girls are condemned to die poor, as opportunities go to the children of richer families.
  • Between 1990 and 2010, the number of people living in extreme poverty halved, and has continued to decline since then. This tremendous achievement is something of which the world should be proud. Yet had inequality within countries not grown during that period, an extra 200 million people would have escaped poverty. Unless we close the gap between rich and poor, we will miss the goal of eliminating extreme poverty by a wide margin. Even if the target of reducing poverty to 3% is achieved, around 200 million would still be living on $1.90 a day in 2030.
  • Those who have been lifted out of extreme poverty often remain very poor, in debt and struggling to feed their families. Many may be only one step away from slipping back. More than half of the world’s population lives on between $2 and $10 a day.
  • This is a deeply inefficient way to eliminate poverty, with just 13 cents in each dollar of global income growth going to the bottom 50%, and 42 cents going to the top 10%. At this level of inequality, the global economy would have to be 175 times bigger just to push everyone above $5 a day, which would be environmentally catastrophic.
  • Globally, more men than women own land, shares and other capital assets. Men are paid more for doing the same roles as women, and men are concentrated in higher paid, higher status jobs. It is no coincidence that women are vastly over-represented in so many of the poorest paid and least secure jobs. Social norms, attitudes and beliefs devalue the status and abilities of women, justify violence and discrimination against them, and dictate which jobs they can and cannot expect to hold.
  • Gender inequality is neither an accident nor new. Our economies have been built by rich and powerful men for their own sake. The neoliberal economic model has made this worse – reductions in public services, cuts to taxes for the richest, and a race to the bottom on wages and labour rights have all hurt women more than men. 
  • Our economic prosperity is also dependent upon the huge but unrecognized contribution made by women through unpaid care work. It could be 20% of GDP. Poor women have to do more unpaid care work than richer women.
  • To secure equality between women and men, we must radically reduce economic inequality. We must define a vision for a new human economy, one that is created by women and men together, for the benefit of everyone.
  • For many of the poorest, income is from small-scale food production. For many others, it is from wages. 
  • Almost one in three workers in emerging and developing countries live in poverty, and this is increasing.
  • The most shocking element of the global labour market today is modern slavery. About 40 million people were enslaved in 2016, 25 million of them in forced labour. Illegal profits from forced labour amounts to more than $44bn. Forced labour has broader social and economic costs, in terms of impeding economic development and perpetuating poverty.
  • Almost 43% of the global youth labour force is still either unemployed, or working but living in poverty. More than 500 million young people are surviving on less than $2 a day.
  • Four million of those in slave labour are children. There are more than 150 million children aged 5 to 17 undertaking some form of child labour, nearly one in 10. 
  • Between 1995 and 2014, in 91 of the 133 rich and developing countries wages had failed to keep pace with increased productivity and economic growth.
  • In many countries no minimum wage or collective bargaining and most minimum wages are significantly lower than what is needed to survive. Minimum wages are also poorly enforced, and the enforcement is worse for women than for men.
  • Temporary is the norm in developing countries, and is on the rise in rich nations. Temporary employees have lower wages, fewer rights and less access to social protection. Women and young people are more likely to be in these jobs. 
  • For many, their work is dangerous and harmful to their health. More than 2.78 million workers die every year because of occupational accidents or work-related diseases – one every 11 seconds.
  • ‘Sexual harassment is very common in this kind of work. At least 90% of women workers are harassed by both the customer and the owners. Justice is on the side of companies.’ – Eulogia Familia, a union leader representing hotel workers in Dominican Republic.
  • Organized workers form a counterbalance to the power of wealth and have been central to the creation of more equal and more democratic societies. Trade unions increase wages, rights and protections, not just for their members but also for workers throughout society. Unfortunately, a downward trend is observed in trade union density rates all over the world since 2000. This is linked  to increasing inequality. It has been compounded by the rise in use of outsourcing and temporary, short-term contracts to undermine labour rights. 
  • Attacks on union members were recorded in 59 countries. Over three-quarters of countries deny some or all workers the right to strike. 
  • The worst jobs predominate in the informal sector of the economy, which goes largely unregulated. Women and young people are over-represented in the informal sector. Large multinationals reduces costs by outsourcing production to smaller businesses that employ informal labour, that pay workers lower wages, and provide less secure work enabling multinationals to circumvent labour and social protection legislation. 
  • A perfect storm of related factors is combining to simultaneously drive up the bargaining power of those at the top, and drive down the bargaining power of those at the bottom. 
  • At the bottom, workers have seen rights eroded, and trade unions undermined, reducing their bargaining power. Corporations are consolidating more and more, and are under huge pressure to deliver ever greater returns to wealthy shareholders. These returns often come at the cost of workers and tax dodging. Corporations use the mobility of their investments to force the race to the bottom between countries on tax and on wages. The threat of greater automation also puts more power in the hands of wealthy owners, and more pressure on workers.
  • The economy not need be the way it is. We can create a more human economy that puts the interests of ordinary workers and small-scale food producers first, not the highly paid and the owners of wealth that could end extreme inequality. 
  • We must reject dogmatic adherence to neoliberal economics and the unacceptable influence of elites on our governments. The economy should be  more equal from the start, and use taxation and public spending to redistribute and create greater fairness. 
  • Studies show that employee-owned companies generate more employment growth and higher pay for their employees. Decision making is democratic, job security is promoted and the highest paid earns no more than nine times the lowest. Our economies could be built with these progressive structures if political leaders prioritize policies that finance, support and foster such models. 

  • Stop talking and give people what they want. A more equal world.
  • Clamp down on inequality not democracy.
  • To tackle extreme economic inequality, we must end extreme wealth and gender inequality. 
  • Increase access to decent work.
  • Regulation can be used to ensure that workers have more bargaining power; that we end tax havens; that monopolies are broken up; and that the financial sector and technological progress benefit the majority. 
  • Governments and businesses can both act to ensure that poverty wages, slavery and precarious and dangerous work are seen as morally unacceptable. 
  • Trade and investment can spread opportunity, products, services and prosperity far and wide.
  • Government must provide education, healthcare and social protection for all, and pay for this by ensuring rich individuals and corporations pay their fair share of tax. 
  • Government's investment in healthcare, education and social protection reduces inequality. 
  • Quality public services benefit women, as they reduce the need for unpaid care and redress inequalities in access to education and health services. 
  • Both rich individuals and rich corporations should pay more in taxation, and avoid paying the tax that they owe. 
  • We need to see an end to tax havens and the global web of secrecy that enables rich corporations and individuals to avoid paying their fair share of tax. 
  • The global race to the bottom on tax for corporations and the rich needs to be reversed. Governments should follow the lead of Chile and South Africa, which have both increased taxes on rich corporations and individuals. 
  • Governments should aim for the collective income of the top 10% to be no more than the income of the bottom 40%.
  • To end extreme poverty, we must also end extreme wealth. Governments should use regulation and taxation to radically reduce levels of extreme wealth, as well as limit the influence of wealthy individuals and groups over policy making. 
  • Every country should aim to produce data on the wealth and income of everyone in society annually, especially the top 10% and the top 1%. 
  • Implement policies to tackle all forms of gender discrimination, promote positive attitudes towards women and women's work, and rebalance power dynamics at the household, local, national and international levels.
  • Recognize and protect the rights of citizens and their organizations to freedom of speech and association.
  • Incentivize business models that prioritize fairer returns, cooperatives and employee participation in company governance and supply chains. 
  • Require all multinational corporations to conduct mandatory due diligence on their full supply chains to ensure that all workers are paid a living wage.
  • Limit returns to shareholders and top executives pay is no more than 10 times their median employees’ pay. 
  • Eliminate the gender pay gap and ensure the rights of women workers are fully realized.
  • Eliminate slave labour and poverty pay. 
  • Promote the organization of workers and protect the rights of workers to unionize and strike, and rescind all laws that go against these rights.
  • Eliminate precarious work and ensure all new forms of employment respect workers’ rights. Ensure the rights of domestic workers, migrant workers and the informally employed. 
  • Publicly commit to achieving universal free public services and a universal social protection floor.
  • Refrain from directing public funding to incentives and subsidies for healthcare and education provision by for-profit private sector companies and expand public sector delivery of essential services. 
  • Strictly regulate private facilities for safety and quality, and prevent them from excluding those who cannot pay. 
  • Use tax to reduce extreme wealth.
  • Call for a new generation of international tax reforms to end the race to the bottom on tax. Tax rates should be set at a level that is fair, progressive and contributes to reducing inequality.
  • Eradicate the use of tax havens and increase transparency, by blacklisting tax havens and automatic sanctions against the corporations and rich people that use them.
  • No dividends or paying bonuses or buybacks to executives if no living wage for workers or producers in their key supply chains. 
  • Companies should ensure worker representation on boards and remuneration committees to include the voice of other stakeholders, like workers in supply chains and local communities, into decision making processes.
  • Support transformational change in supply chains.
  • Share profits with the poorest workers.
  • Support gender equality in the workplace.
  • Reduce pay ratios. Publish the company’s pay ratio between CEO and median pay, and reduce this ratio to no more than 20:1.
Support collective bargaining. Remove barriers to women workers participating in unions and leadership positions, and promote women workers raise their voices safely and effectively. We must redesign our economies to reward ordinary workers and small-scale producers. We must stop excessively rewarding the super-rich. It is what people want. It is what our leaders have promised. Together we can end the inequality crisis. We can build a more human economy and more equal world for our children. 

Read the source report at

We can have democracy in this country, 
or we can have great wealth concentrated in the hands of a few, 
but we can't have both ... Justice Louis Brandeis, US Supreme Court

The global economy on a wildly unequal trajectory is absurd and unsustainable. For getting everyone above poverty line (> $5 per day) would take 100 years, require $1m GDP per person and per capita income about $100,000. As a result, ending poverty under the current model is slow, inefficient and runs into planetary problems. Already the present global economy is in ecological overshoot. A radical shift in distribution to favour the poorest is the only way to reconcile the twin challenges of halting catastrophic climatic change and ending poverty.