Inequality

What political parties are fighting about, is how to achieve a more egalitarian society, where everyone has an equal opportunity of reaching the top. There are too many children without equal opportunities for success. World inequality continues to grow. In  the past three decades, 28% of the increase in real incomes in North America and Western Europe was captured by the top 1% of earners. The top 1% of India's population holds nearly three quarters of the nation's wealth.

• The majority view seems broadly to want to tax earners and owners more heavily; to take away from some so others can have more. It’s easy to convince people that this is the quickest, actually the only way.
• Inequality is not in itself unfair. We all know that rare skills possessed should be rewarded better. Building assets for poor people is extremely important. 
• The surest and quickest way to ameliorate inequality and diminish poverty is radical economic transformation at all levels of government, the entire bureaucracy and the state-owned companies, so that it would spend every single available rupee of taxpayer money on development and upliftment; that state organs’ efficiency and productivity are increased radically; and that corruption is eradicated.
• The middle class wealth reached its peak in the mid-1980s. But it’s been ravaged by stagnant incomes, unstable property & investment markets and growing consumer debt. 
• Many developing nations have targeted poverty alleviation. While China has achieved poverty alleviation on an historic scale, the obstacles - bureaucratic inefficiency and failed policy implementation remain. India has made progress in alleviating poverty, although it lags significantly behind China. 
• Inequality hampers growth by leaving human potential unrealised. The middle class provides market for consumer goods and services, which in turn creates jobs. The cycle is interrupted when profits are excessively retained, rather than reinvested into further capacity – such as health and education sectors. 
• More than 20% of  Indians are poor. India saw the fastest rise in inequality between 1980 and 2016, and 55% of the country’s income share is in the hands of the wealthiest 10%. Across the developing world, blunt policies are not only proving ineffective at reducing poverty, but also widening the wealth gap. 
• Most national level policies are either ham-fisted or intentionally ineffective. They tinker at the margins with transfer payments and social programmes, while failing to address structural causes such as gaps in educational achievement and public health. 
• Failure to improve basic services is one of the most glaring gaps in inequality policy. Private sector and philanthropic intervention, while helpful, is no substitute for equal access. India spends only 1% of GDP on health services, compared with the world average of 6%. 
• The policy ineptitude by the governments in the US and India are in thrall to discredited claims about “trickle-down economics” and have passed sweeping tax reforms that substantially favour corporations. 

The twin reforms of demonetization and a goods and services tax may have also stunted job growth by crippling the construction and informal sectors, that employs most migrant workers. Political will  is inexcusably weak. Both the economics and the ethics of inequality demand transformational thinking. But the voice of the poor continues to be drowned out by a global minority enjoying elite status and by the many who aspire to such status.

Modinomics and its Incoherence

Modinomics are the economic policies of India’s Prime Minister, Narendra Modi. His followers or voters believe that Modinomics is a much-needed panacea to India’s economy. Unfortunately, there is no coherent difference between Modinomics and other “socialist” policies. Devotees of Modinomics believe, “lesser evil is better than bigger evil”, whereas liberals believe that Modinomics doesn’t make social-economic sense. There is no difference between both sides because their virtual goal is to maximize state power and social demagogy in a euphemistic way, at the cost of personal freedom, individual volition and cultural liberty.

• Modinomics is an immoral economic approach to individual freedom and socio-economic libertarianism.
• The established narration is socialism (government owning the resources, controlling, regulating and manipulating the means), which is totally against the hyperbole of free market capitalism.
• The Indian economy led by PM Modi and his “expert” team is consciously ignorant of economics.
• The matrix of Modinomics is again hopelessly inured and infatuated with etatism or statism.
• It is said that PM Modi is a pragmatic modernizer of “government running the economy”, but in reality his government failed to minimize the government’s role. His favorite rhetoric “minimum government, maximum governance” convinced the ultracrepidarian class, youngsters and global investors, but the result is “maximum government, minimum liberty”.
• Although his government has taken grim steps to outlaw the unnecessary laws, bureaucratic instruments and interventionists, Modinomics is still an old wine in a new bottle. His government is still run by the economics of “moral hazard” policies, “too big to fail” mechanisms, albeit his government iterates “recapitalization of public units” dialogue. 
• His followers strongly hold the opinion regarding his Fabian way of enriching the economy but their forgiving-forgetting attitude doesn’t distort the truth of economics.
• Modinomics, unlike the previous system of governance, suffers from ‘Emporiophobia’ (fear of free market),‘Aurophobia’ (fear of gold savings) and ‘Apoplithorismosphobia’ (fear of deflation). 
• Considering his government’s ‘selective silence’ on major economic issues like property rights, civil liberty, secessionism, economic expropriation, indirect taxation, capital structure, border trading, etc., it is right to ratiocinate that his government is a turban-less Keynesian. 
• Modinomics, along with the economic system of India and its paid politicians, still repeats high-sounding terms like “freedom of the investors” and “stable growth” which sedates the madding crowd. The terms “private” and “freedom” no longer mean what they are. They are cruel deceptions that fool the mind yearning for human freedom. 
• The fact is that in India we still have massive regulations and regimentations. This is necessary, we are told, because it is “in the public interest.” Terms like “public interest” and “common good” are code words that mean police state and reduced liberty. How has Modinomics liberated the Indian economy?
• With this reverse propaganda, the opposition has been neutralized. True words, true meanings of patriotism (example: bolo “Bharat Mata ki Jai”) and freedom have become the farce and illusion that cover fascism. 
• PM Modi has attracted the millennials in droves, based on the lie that “UPA’s socialism is immoral but his brand of socialism is moral” because it guarantees “liberty of opportunity”. 
• Modinomics is also embedded with obscure ideas when it comes to deciphering trickle-down economics, social spending and international economy. 
• His government voices out that the Indian economy would balance between growth and development but fails to understand that growth and development are conventional and outdated concepts, in the current changing environment. Neither growth nor development improves the real essence of economic liberty. In fact, they both crush the schema of economic freedom.
• Catallaxy, market voluntarism and property rights can be considered as sound solution(s) to counter the fascism of Modinomics and ‘Sickularism’. As long as Modinomics doesn’t divorce its romance with/from eminent domain, public monopoly and crony capitalism, it would stand indifferent in this whole paradigm. 
• The time has come to apply deductive reasoning against such economic philosophies advocated by the politicians than falling for rhetoric et al. Simply put: “Modinomics rewards sloth and penalizes hard work while Voluntarism rewards hard work and penalizes sloth.”

 

Read the original article - June 2016