Showing posts with label middle class. Show all posts
Showing posts with label middle class. Show all posts

Sunday, 23 June 2019

Ways to narrow rich - poor gap

Across much of the world, the share of national income flowing to labor has fallen over the past 40 years. Taxing the rich in order to fund spending on the poor is a straightforward solution to inequality problem. But the well-heeled are adept at squeezing through tax loopholes, and at marshaling the political clout needed to chip away at high tax rates. Income inequality is the result of bad policies that favor the rich and leave everyone else struggling. A social wealth fund could narrow the gap between the rich and the poor.
  • People don't realize how wide the gap between rich and poor has become. Credit masks poverty. We tend to see and associate with people who are like us, economically.
  • There's no surer ticket out of poverty than a solid education. But that education has to be affordable and it has to be equally distributed. Poorer students are years behind their richer peers. Richer kids go to a private schools. Poorer students go to a government schools that does not perform well. Education should be a great equalizer, not a source of division. 
  • A hard day’s work deserves a fair day’s pay. It's impossible to live on today's minimum wages, which are essentially poverty wages. Decent minimum wages (for 8 hours/day, 6 days/week work) must cover home rent, utility bills, groceries, basic health care expenses, children education and some savings, for a family of 2+2. Today's minimum wages or poverty wages that covers food expenses only, for a family of 2+2. They must be at least be double or treble.
  • It's convenient for employers to argue they can't pay higher wages. Their profits indicate otherwise. The reality today is that people who are working full-time are unable meet their family(2+2)'s basic necessities.
  • Tax rates on the very rich are so low. While middle class salaried person on an average pays income tax at more than 20% on gross real income, the rich pays lesser than 10% of his gross real income. The rich must be taxed at least 40-50% of gross real income and this additional amount must be spent for better education and health care of lower income groups. Without good education and sound health, one can't work hard to prosperity.
  • Give workers a voice in their companies. Worker union's role is is declining since 40 years and their voice shrank to a whisper. Meanwhile, the economy is pushing a greater share of money to the top management. While half of the people view worker unions in a favorable light, the other half continue to see unions as inefficient or annoying, but there are other ways to give workers a voice, such as supporting employee-owned companies.
  • Ban political donations by businesses and industry. Let politics get funded by people (individuals only) and government. Compel politicians keep away from influential rich industrialists.
  • Give money to the poor -- maybe at random. Randomly giving poorer people cash may not be such a bad idea. A nonprofit organisation which is experimenting with the concept is seeing promising results. The point is not exactly how a program like this should work but that when we trust people -- when we see them as equals -- they can succeed.
  • We see rich and poor differently. We assume that these divisions are inevitable. They don't have to be.
  • Investing in women (family-friendly work policies, paid parental leave, allowing kids in the workplace etc), agriculture (providing farmers with access to seeds, plant nutrients and production practices, risk mitigation, weather insurance etc) and reforming workplace laws (raising minimum wages and universal basic income etc).
Let us not forget history. The Roman Empire was one of the richest on the planet, with wealth concentrated in the hands of a few senatorial elite and the rest were utterly poor. Warning signs of inequality were ignored and it resulted in civil war and the entire empire collapsed. Do we want that again? Let us collectively work towards making an equitable world.


Thursday, 17 January 2019

Intensive parenting

Intensive’ parenting is now the norm in affluent & middle classes in many countries. How you raise your child will have a profound effect on their whole life. The style of child-rearing that most aspire to takes a lot of time and money. Supervised, enriching playtime; frequent conversations about thoughts and feelings; patient, well-reasoned explanations of household rules and extracurricular's. Lots and lots of extracurricular's are the hallmarks of a 'intensive parenting' style that has been common in upper-middle-class for at least a generation. Intensive parenting is child-centered, expert-guided, emotionally absorbing, labor intensive and financially expensive.
  • Parenting is a skill, best understood by experts and very rarely by mothers and fathers. Parents are constantly informed that what they do - not only matters but also determines just about every dimension of their children’s lives. 
  • Intensive parenting was identified as a middle-class phenomenon in the 1990's and 2000's. The desire and pressure to give kids every means possible to succeed: the best education, music lessons, sports groups, language skills and corresponding anxiety with limited financial means, the family budget and parent time between all kids is stretched, and so are their opportunities.
  • The approach of concerted cultivation and contrasted it with the accomplishment of natural growth, which entails much less parental involvement and which is found to be more common among working-class and poorer parents. 
  • It is not being poor, but poor parenting that is held to account for why children are ill prepared for school. A dad’s interest in his child’s schooling is strongly linked to academic success.
  • If parents from different social class backgrounds are engaging in different parenting practices is not because those parents value different parenting practices because intensive parenting requires an abundance of time and money and some families have more resources than others. 
  • Poverty not only limits parents’ ability to pay for music lessons etc, but is also a major source of stress that can influence parents’ energy, attention, and patience when interacting with children.
  • Few decades ago, parenting by families with sufficient means started engaging in intensive parenting, and then everyone else followed and that elite culture gradually became mass culture.
  • Intensive parenting is a style of child-rearing fit for an age of inequality, indicative of a stratified past, present, and future. The past: The tilt toward intensive parenting originated from parents’ anxieties about their children competing for education and jobs. The more extracurricular's, the better the odds of getting into an excellent college and of securing one of the high-paying jobs. The present: Intensive parenting is an ideal that’s currently out of reach for many families. The future: Practiced as it is by some families might widen inequities in future generations.
  • Many children benefit from intensive parenting teaching them how to manage their time and assert their individuality. But heavily involved parenting can at the same time stunt kids’ sense of self-reliance, and over-committed after-school schedules can leave them exhausted. 
  • The parents who overdo it increase the risk that their children will grow up to be depressed and less satisfied with life. And for parents, the intensive ideal can lead parents to fear that they aren’t doing enough to give their child the best future possible.
That parents exercise enormous influence over their children is not in doubt but they do so not simply through their so-called parenting skills but as members of a distinct cultural, social and ethnic community. The quality of children’s lives and their future prospects is influenced by many variables other than the behavior of their parents. This style of intensive parenting consumes parents' lives, but there isn't much benefit for the children, either. It is better to give kids the best opportunities a parent can, within their means, while still allowing the child to develop a healthy sense of independence and responsibility.
There is no job more important than parenting. 
Treat children like king till 5 years, like a slave until 15 years and like a friend thereafter.
You can't create a world for your kid. But you can prepare them to face the world. 

Children learn from parents by imitating them up to the age of 7-8 years and there after from peers in school and outside. Although learning from other's experiences is fastest, cheapest and easiest, usually most people, especially children, learn through their own mistakes which are expensive, time consuming and embarrassing. Parents must imbibe values in their children by their exemplary behavior. 'Don't do what I do, do what I say' attitude is usually counter productive. Investing in children is a positive thing, but it’s also unclear how much of children’s success is actually determined by parenting.


Saturday, 15 September 2018

Support local businesses

Locally owned businesses play a central role in healthy communities. Small business ownership has been a pathway to the middle class and continues to be a crucial tool for expanding prosperity and community self-determination. When a consumer supports his local business owners, he enjoys benefits he can’t possibly get from shopping at national chains. Here are some reasons to support your local entrepreneurs. 
  • Improves family health.
  • Locally owned businesses contribute much to local causes.
  • You will know the people behind the product.
  • Preserves uniqueness of your community.
  • Better customer service. 
  • More personalized service. Small business owners will bend over backwards for every customer, because every single customer matters when they are small.
  • Locally owned retailers recycle a much larger share of their revenue (~52%) back into the local economy than the chain retailers (~14%), enriching the whole community. Similarly, the local restaurants re-circulate an average of 79% of their revenue locally, compared to 30% for the chain eateries.
  • Locally owned businesses create more local jobs and provide better wages and benefits than chains do.
  • Entrepreneurship fuels economic innovation and prosperity, and serves as a means for families to move out of low-wage jobs and into the middle class.
  • Local stores require little infrastructure and make more efficient use of public services than the big stores and shopping malls.
  • Local stores help to sustain vibrant, compact, walkable town centers and in turn reduce sprawl, automobile use, habitat loss, and air and water pollution.
  • A marketplace with several small businesses is the best way to ensure innovation and low prices over the long-term.
  • A multitude of small businesses, each selecting products based, not on a national sales plan, but on their own interests and the needs of their local customers, guarantees a much broader range of product choices.
  • Shopping local is more important than people think. Even the value of your home goes up.
  • Local small businesses outperformed their peers in income growth, employment growth, lower poverty rates and lower levels of income inequality. 
  • Communities with a larger share of local businesses have more social capital, stronger social ties, higher levels of civic engagement, and better success solving problems.
  • More local businesses ensures lesser usage of automobiles by as much as 26%.
Enacting policies that strengthen small businesses and expand opportunities for local entrepreneurs is one of the most effective ways of reducing inequality and expanding the middle class. In India, government finds it difficult collect taxes from large number of small businesses, especially in informal sector, and tendency has shifted to promoting larger businesses for better tax realization and in their quest for taxes collection simply forgot their fundamental responsibility of reducing rich-poor gap.  Modi and Jaitley are guilty of  inflicting deadly blows to 'informal sector' which provides livelihood to >60% of the people with their 'hare brained demonetization' and 'haughtily designed & implemented GST' which almost pushed the entire Indian economy to the brink of collapse.

Friday, 15 September 2017

Autocrats triumph in democratic countries

  • Democratically elected leaders who triumph in elections often move towards autocracy by undermining checks and balances and consolidating power. In India, Indira Gandhi and Modi are examples of such phenomenon.
  • The most common way for a democracy to collapse is through the actions of elected incumbent, not a coup or revolution.
  • Hugo Chavez, 4 terms elected president of Venezula, dismantled institutions and expanded his authority. Vladimar Putin of Russia has concentrated so much power in his own hands he is known as 'elected dictator'. Erdogan of Turkey following the same path.
  • Once in power, unscrupulous leaders manipulate political environment more likely that they are sure of winning future elections. Thus they gain stamp of democratic legitimacy even for actions that ultimately undermines democratic norms.
  • Manipulation and winning elections has become a kind of exploit in the rules of political legitimacy to hack the system. People around the world have become attached to the idea that elections have become defacto requirement for government legitimacy. Winning the election through popular vote is treated as conveying moral and procedural validity.
  • Election winner claims popular support for changes that undermines democratic institutions and stripping away checks and balances. Opponents who criticize runs the risk of looking anti-democratic trying to thwart the will of people expressed at ballot box.
  • In some autocracies elections are 'farce' and in some they were 'genuine' contests though they may not be fair. Techniques like curtailing press freedom, limiting opposition's ability to campaign, and spreading misinformation enable incumbent to manipulate election outcomes without resorting to traceable techniques like ballot-stuffing.
  • Chavez systematically revoked broadcast licenses while Putin cracked down on dissent and shutting off political opportunities for opposition. This kind of manipulation is not only powerful, it is also hard for opposition to prevent. This way, autocratic leader can avoid risk of losing votes while gaining legitimacy from its result.
  • Often leaders who subvert democracy and whose electoral success is partly attributable to tilted playing field remain genuinely popular with much of the public. This contradicts democratic belief that elections are an effective check on tyranny. 
  • What voting taketh away, voting can giveth right back. A habit of elections may also make it more difficult authoritarians consolidate their autocracies. This is strength and weakness of democracy.
  • Leaders who benefit from polarisation and manipulation of political contests in their favor will eventually lose popularity. Then a tradition of regular tradition makes it easier for country to return back to democracy. One election is not a cure-all.
Twenty or even ten years ago, the possibility of a global democratic recession seemed impossible as states grew wealthier, they would develop larger middle classes who would push for ever-greater social, political, and economic freedoms. Human progress would spread democracy everywhere. The middle class rather than work to defeat these populist & authoritarian leaders at the ballot box or strengthen the institutions that could hold them in check, they have ended up supporting undemocratic measures.

In a democracy government should be afraid of their people.
Propaganda is to a democracy what the bludgeon is to a totalitarian state.
Democracy consists of choosing your dictators.
When threatened, the first thing a democracy gives up is democracy.
The best cure for the ills of democracy is more democracy.
To oppress the opposition is to assault the very foundation of democracy.

Almost all the above statements confirms Modi as an autocrat practicing authoritarianism. His relentless high decibel propaganda stating failures as successes is height of all the things. Democracy is not a simple thing: It’s a complex system of strong institutions and legal checks. Very few nations have mastered it fully. And sustaining it is a never-ending effort.