Sunday, November 23, 2008

Dealing with Finance Crises

John Samuel


We are in the beginning of the slump. And it may deepen by the second half of 2009. My sense is that it will take three to four years to recover- i.e. by 2012. Though there will be slump and reduced production and demand in the US, most of the emerging economies got a growing domestic market- and manufacturing capacity. In the 1930s- most of the present emerging economies did not have a growing market - and the primary trade was in commodity- when the commodity market- primarily exported to Europe etc collapsed, the impact of the crash (1929) also adversely affected Asian countries in a big way.

So this will be a deeper recession than the earlier ones in the late seventies, and late 90s. But the world economy may be more resilient now- due to more coordinated efforts, quick remedial actions, growing market-with absorption capacity and productive capacities, and potential recalibration of the currency market. It is also due to the fact, Banking and financial sector is more regulated in the emerging market. So the central banks in Asia countries got almost 4 trillion USD as deposit. Many of the established companies in India, China and the gulf are actually cash-rich: so the ongoing credit crunch may not affect their expansion plan so much- though they may delay it in the very short term.

Those who will be severely affected are:

1) Real estate business- that is primarily driven by the credit market. So many builders will burst the demand will decrease and they will not be able to pay back the mortgage. This is also because there is lots of short-term foreign investments- that too based on international credit- and that will dry up. But our banks like HDFC are relatively safer as their terms for housing mortgage are rather on conservative terms (floating interest rates) and mostly given on credit worthiness.

2) A section of BPO and IT will be affected. But not all of them will be wiped out- because many of the Western countries will find it cheaper to do operations in India. However, they may renegotiate for lesser price- and this may result in reduction of salaries and benefits across the board in BPO and IT sector. Such cuts will not be more than 10 to 15% - it may not drastically affect the consumer market- though there will be less demands for cars and mobile phone etc.

3) Shipping, Airlines and transport may be affected in the short term

4) Hotel and tourism will be affected too.


Though India will be certainly affected- there is less reason to panic- as this can actually turn in to a great opportunity for India.

There has to be short-term and long term measures to deal with the crises..

Here are some possible options-

1) Stimulate demands- by substantial government expenditure in the area of rural economy, infrastructure, and agriculture. ( FRBM-2003- needs to be scraped)- A neo-Keynesian strategy with a focus on rural economic generation may help in many ways.

2) A review of the existing financial and banking framework- and ensuring that we have a robust regulatory framework that do not stifle growth and at the same do not expose us to big volatile financial market elsewhere.

3) A coordinated efforts by all the major banks, corporate actors and policy makers to develop a strategic framework to restore investor confidence, ensure that there are no drastic cuts in the jobs and to make sure that the new stimulation for demand, monetary policies, and investment patterns are balanced. For example, the usual steps are cutting interest rates, cutting tax in some crucial sectors, ensuring the stock market stability- by banning/regulating short-selling and sudden withdrawal of international investments- a more coordinate strategy to make sure that Stock exchange and currency are stable.

4) Massive tourism promotion- with cheaper price-hotels may have to renegotiates the cost of labour and cut the prices by fifty percentage. Government should go out of way to get tourists- particularly from Middle East and Europe and ensure a sort of "value for money" tourism.

5) A strategic trade-framework- particularly with Asian , East European, Central Asian and emerging African economies- this may help us in the long run. Actually Central Asia will again emerge in the next phase. So it is important for India to strengthen strategic relationship with Iran, Central Asia and Afghanistan. Central Asia also got so much natural resources.

6) A well coordinate programme to regenerate the rural economy by a clear plan for boosting Small and medium scale industries- with a value-chain process- that also create markets as well as stimulate demands.

7) A multi-sectoral task force headed by the Prime Minister to do every day assessment and weekly action plan- in the next one year. In fact NREGA can be redesigned and used as a major means to stimulate demands- by extending the area of operations.

8) A careful and well planned security action plan( along with top-end intelligence inputs) to make sure that there is no political disruptions, major sabotage, or terror attacks that would paralyze the economy. There has always been a connection between economic crisis, violence, terror and war. So the next three years- government will have to be very vigilant.

9) It is important to call an all party meeting- and also a meeting of all finance ministers and chief ministers to make sure that at all levels we have thoroughly coordinated effort to stimulate demand as well as growth, to restore investors’ confidence and to ensure coordinated intelligence. Government should also think of declare a package of something like US$ 250 to 350 billion for stimulating demand in the next two to three years.( this will send positive signals about the confidence of Indian economy)

In fact, India can actually use this challenge as an opportunity to rise up to the occasion and emerge as a much more economically and politically stronger country. But I wonder whether our present or even potential leadership - in the post election scene- may have the political and economic imagination to make use of this opportunity
And transform India and south Asia.

Every economic crisis is a potential warning signal for a politics of fascism or politics of transformation. We are in the midst of a defining period- like the one from 77-83. There are defining periods of history- that actually influence and shape the world for the next twenty to thirty years. The period from 2008 to 2012 will be such a defining phase of history- and the world will not be the same after 2012- there could be high profile disruptions, assassinations, economic troubles and political turmoil- and eventually the birth of a new paradigm. If we look at the word- this happened between 1925 to 30, 1945 to 50, 1977-82 and now at the end of the Regan-Thatcher paradigm- we are getting in to the transition period of 2008 to 12.

It is those who an capture the political and economic imagination- it is those who can come up with big ideas- and possible way forward- will influence the world till 2030 or 35.

Thursday, November 6, 2008

Raaga...

Music makes Memories Intimate!
Rekindles nostalgia,
Of unfolding worlds within
And beyond.
Music makes a magic.
Of the breeze deep within.


A raaga of Bhimsen Joshi...
Stir up the intimate worlds...
And the gush of youthful memories..
Of Sawai Gandharv
Festivals.
Of moonlit nights,
Of motorcycle rides..
Of a tree...in a starry night
Smell of a winter.
Anticipating a spring.

Discovering
Everyday – sunrise, noon, evenings and moon
Smell of Burgi at GaneshKhind.
A fountain in a circle,
Days of sunny drizzle..
Of Music, Cinema, Poetry, Politics
And Love.

Getting Lost
Rediscovering again and again
Learning new pathways.
The raaga of a dawn
Makes me smile.


John Samuel

Saturday, October 25, 2008

Happy Diwali!

Happy Diwali!

It is time to celebrate...indeed!
Diwali with a billion diyas.
In the midst the dark clouds
Hovering over an idea called India...

Diyas in the hearts of darkness.
The lights that can dispel despair...
The lights that can heal the wounded.
The lights that will expose the lies.
The light that will make us smile.
The lights that can diffuse bombs deep within...

Diyas, beyond a Diwali.
Of hope and healing.
In the midst of a winter...
Burnt smell of prayers...
Smell of Sulphur
Raped nuns!
Screams of children
Blood on the streets
Flesh fuming in the air.
Terror dancing in deadly flames...
Frozen consciousness in a chilly night!
In the days of bicycled bombs!
Deadly entertainments on the TV screens
Reeking mouths of ministers.
Fashion parade.
Parliament in a cacophony
Slaughtered ideals
And plastic people.


A billion more lights.....
To fight the demons within.
To wake up our land to the freedoms...
To a garden of bright flowers and fragrance
To listen to the sighs and sorrows.
To erase the tears.


An eternal Diwali...
With a billion diyas in the eyes...
Jingles of the flowing rivers.
Mingled with the magic of a dream
No hungry child on the bed
No crackers.
No sound and fury.
Only silence of prayers.
The warmth of the diya,
Soothing our souls
For ever.
.
Dignity blooms in the morning sun,
In a million coloures of the spring.
Let my India shine tomorrow
Beyond the shames of today,
And the shadows of yesterday.


We are the diyas,
On a million pathways to the truth...
With a billion smiling diyas in the hearts
Dancing in the winds
Diwali, waiting for us...
We too are waiting.
For ever...

Happy Diwali.


John Samuel

Wednesday, October 15, 2008

Vietnam Views

John Samuel


Every city has its colours, character and smell. Ho Chi Minh City reminds me the colours yellow and green. Those buildings with French flavour- with yellow walls and green windows- and that greenness of the trees and parks in the midst of the buzzing city make me smile. Those millions who move on mobikes or those cars pleasantly marginalized in a sea of motorcycles and bicycles gave some sense about the middle class- character of the charming Saigon-now named after Ho Chi Minh- the national hero of Vietnam. I could smell sweat on the pavements, petrol in the air and the fragrance of morning flowers in the park. Spas are sprouting in the midst of new neon-lit nights. Pimps politely promise the new pleasures to potential customers in the shadow of high rise buildings as the night gets settled in. This is a city with a history- of trade, colours, cultures, bold and beautiful people, war, dreams and promises.

Ho Chi Minh is not merely a city. Ho Chi Minh is more than a national myth. Ho Chi Minh is more than the name of a simple ordinary man who did extraordinary things to discover the collective power of dignity, unity and freedom of a people. Ho Chi Minh signifies a collective sensibility of self-reliance, pride, perseverance and urge for freedom. In 1976, the charming city of Saigon in the south of Vietnam became Ho Chi Minh City – symbolizing the freedom and liberation from more than a hundred years of French colonialism and the imperialist invasion.

I had a breakfast with a group of HIV positive people- organized as a community organization called the Rose. I could smell a bit of rose in their sense of hope and resolve to live- by supporting and caring for each other. The little child of two years with a beautiful smile does not know that both her parents in the early twenties are HIV positive people. But she is HIV negative and happy. Her parents are very young- who got HIV when they used to share the syringes for the drug use. Now they are active members of the Rose group- who get together twice or thrice a week to sing, meditate and to support each other. Community still matters here. There is still a culture of mutual care and support.

In the evening, I was sitting with a neighborhood group of women in an inner district of Ho- Chi Minh City. They shared with me stories and boiled cassava. They told me stories of support and survival, stories of stopping domestic violence- stories of hope and change- stories that changed lives and helped to discover dignity and power within. . In the porch of a shop-cum- house they meet twice in a week to discuss the community issues, to receive complaints, to decide the course of action in the case of a domestic violence or family trauma. They served me my favorite childhood dish- boiled tapioca/cassava with onion- chilly sauce. The tapioca taste caressed the nostalgia of my childhood Kerala in India. The stories of women’s empowerment inspired me to imagine a more just and joyful world.


Ho Chi Minh is the official name of the Saigon city. But Saigon is evident every where- on the bill boards, in the shops and on the street. The old charms of an erstwhile Saigon with streets in the shadows of trees, bicycles, the brick-built Cathedral, river and breeze have got submerged in to the high rise building, noisy night clubs and the smell of petrol.

I went to the Durga temple near the Chinese street. The young priest Ramesh Aiyyer smiled at me – recognizing the brown face of a country cousin- and told he could manage to speak “koncham, koncham” Tamil. An old steamer got his great grant father from the South of India to the Saigon. The Hindu culture in the South Vietnam goes much deeper than the migration from the South India during the colonial period. The Cham culture- that influenced parts of the present day Southern Vietnam and parts of the Cambodia- evolved out of the Hindu religious practice and beliefs. The Mosques in the city smell of the history of trade- the Muslim traders from different parts of India and Arabia came to these lands in search of spices and spouses. The Chinese – who left the city after the liberation in the 1976-, are back in full business. Ho- Chi- Minh City- is the cosmopolitan Saigon transformed in to a busy city- a city that began to look more like Bangkok and the charms of old Saigon are fast fading away. This city of 6 million people in many ways symbolize the new Vietnam- confident, relatively more open, busy- and with fading of an old world.

Part II

Vietnam is no ordinary country. It is a long country with a long history. It is history of troubles and tribulations, wars and victories, survival and sustainability. So fighting and winning wars made them a people and culture with a sense of shared identity and history. In the 9th century, they drove back the Chinese Hams, ending a history a thousand years of Chinese subjugation of the region. In the 11th and 12 the century fought against Chams who sought to invade the country. Genghis Khan and his grandson Kublai Khan too came here to find the armed resistance in 13th century- that drove them back. The Ming and Ching dynasties of China once again tried to occupy the land in the 15nth and 17nth century respectively. No way- they too had to go back. Then the French came. They fought for thirty years. But French with new weapons and colonial power persisted. In 1860 the French occupied what used to be known as the Indo- China (consisting of the present day Vietnam, Cambodia and Laos). By the beginning of the 20th Century, the French consolidated their power and divided the present day Vietnam in to three provinces- Tonkin in the North, Annam in the Centre and Cochinchina in the South. This division of the country with a shared sense of history was not merely for administrative convenience but it was a strategy to divide and rule. This colonial driven process of dividing the country influenced the history of the country to this day. Even after hundred years of such division, there is a subtext of political and cultural tensions between the North, Centre and South of Vietnam. Though the French colonial period was relatively small in the long history of Vietnam- they made lasting imprints. The original Vietnamese script – resembling the Chinese script- was replaced by Latin script. But this also helped print books in a much easier manner and eventually helped to educate a large number of people. The shift of script- from the one that is based on images or ideas to the one based on phonemes- in many ways symbolized the shift from the old feudal aristocracy to a new sense of modern Vietnamese identity. Paradoxically the linguistic subversion by the French helped to popularize the written word. And the written Vietnamese in the Latin Script helped to spread nationalism and resistance against the colonialism and imperialism.


Those young men came back after their higher education in Paris brought ideas for change and challenge. The French steamers brought them back to Saigon with Marxicism and massive resolve to challenge the French. The romance with Communism started when few of those young people started the Indo-China Communist Party in 1929. These particular moments of 1929 and the dreams of those idealist young men changed and influenced the history of three countries- Vietnam, Cambodia, and Laos. While those ideas of promised Utopias inspired the poor and ordinary people and helped to mobilize the people against the Colonialist and imperialists, they also left scars of bombs, death and destruction across three countries.

The story of resistance against French Colonialism and American Imperialism is one of the most inspiring stories - in the twentieth century -of the collective resolve of the ordinary people to stand against the most brutal and unethical powers of the world. A young lawyer- who later came to be known as Ho Chi Minh- founded Viet Minh – or the league for Independence in 1941. Viet Minh – the movement for freedom became popular and enjoyed the mass support. They have declared independence in August 1945 in Hanoi. Emperor Bao Dai- from the Vietnamese Royal Family-abdicated and offered his services as an advisor to the new regime of the people and by the people. French did not want to lose their precious piece of colony in the east. They still controlled the South of Vietnam- the Cochichina province. While French tried to co-opt the northern resistance movement though an agreement in March 1946, they also declared Cochinchina as an independent country – and sought legitimize this by asking the erstwhile King Bao-Dai as the head of the State. Viet Minh did not keep quite. Nine years of guerilla war followed and like in the case of all the earlier wars from the 9th Century onwards, this time too the organized collective will of the ordinary Vietnamese prevailed. They defeated the French in 1954 and sent them back to France forever.

Free from the French, Vietnam was on the way to build a free country. But that was the beginning of a new war- one of the worst in the recent human history. Once the French colonialist left, the American Imperialism got paranoid about the possible spread of Communism to the entire Asia As a part of countering Communism in the east, the USA used the usual tactics of propping up a puppet government in the Southern Vietnam against the people’s government in the north. Here too the Vietnamese people’s movement refused to surrender to the will of the power of bombs and bulldozing imperialism. They got reunited in the name National Liberation Front (communists, democrats and nationalists) - Viet Cong- and fought back against the American dominance. This is what led to the Vietnam war- the brutal face of American Imperialism. Larger tones of bombs were dropped in this one country than the entire Second World War. There were 580, 000 American troops in 1969. The American Military committed some of the worst war crimes- by using weapons of mass destruction of Chemical .Bacterial and nasty weapons. There are still thousands who are suffering from the use of chemical weapons by the American army. Even in the 1960s and 70s, the USA spent more than US$ 150 billion to bomb a Country – the most brutal one in the name of prostituted promise of “Freedom”. The American bombs destroyed 70% percent of northern villages and left 10 million hectors of land barren. The face of a naked, nasty and obscene imperialist aggression stared at the world with sense of impunity- in the midst of the cold war. In the midst of the war- the most inspiring leader of the people’s movement- Uncle Ho as endearing called by the people of Vietnam- died in 1969. This eventually evoked a world wide response against the brutality of American Imperialism and also huge mobilization of young University students against the Vietnam War. The protest against Vietnam war across the world- not only reflected the ideals of angry young people, but also it initiated a new peace movement beyond the traditional left and the right forces. The Vietnam protests helped to politicize the civil society in America, Europe and many parts of the world.

In spite of all the powers, bombs and propaganda machines of the world, USA miserably failed in Vietnam. Viet Cong captured Saigon in April 1975 and renamed it as the Ho- Chi Minh city in 1976- as the symbol of freedom and liberation. After a period of brutal war of deaths, destruction and migrations, Vietnam emerged as the Socialist Republic of Vietnam. Though the country emerged victorious, there was a new war waiting to happen – against the Pol pot regime of Cambodia. The story of Vietnam seems to be the story of war and survival.

The new independent Vietnam was supported by the USSR and many other countries including Iraq. The war torn Vietnam was one of the poorest countries in the world. People sought to migrate to different parts of the world. Many students got scholarship to study in Russia and other parts of eastern Europe. Iraq offered jobs to many Vietnamese youth. India too supported Vietnam at the height of their struggle and Nehru is still a popular name among the elder generation. Though many from the earlier generation speak fluent Russian, English teaching is one of the most vibrant businesses in the Hanoi and Ho Chi Minh city. If the history of Vietnam from the 1950s to 1980s is the history of war and survival, the history of Vietnam in the last twenty five years is the history of the revitalization of a country – emerging with dignity and development from a really bruised war-torn past.

While sticking to some of the basic principles and values of Socialism, the Communist Party and government consistently sought to renew themselves to be relevant to the needs of the people and trends of the world. In 1991, the government of Du Muoi introduced Doi- Moi (Renewal- signifying the opening up of the Stock Market and economy). This was followed by the new initiative for grassroots democracy and democratization – through mix of Local self governments, civil society organizations, fatherland friends’ organizations of the frontal organizations of the Communist Party and strategic coordination of the NGOs for delivering development at the grassroots level in collaboration with the government. Vietnam moved in to the highway of steady economic growth- one of the highest in the world. As the economy grew at the rate of 6- 8% annually, the level of poverty reduced from 58% in 1993 to around 20% in 2008. The country made tremendous progress, within matter of a decade or two, in terms of human development and gender equality. There are laws like Gender Equity Law and the Law to combat domestic Violence. There is also tremendous progress in Education, there are now new issues concerning the quality and access to education. Many people in the rural area- particularly among the ethnic minorities and older generation, illiteracy are still prevalent.

While the economy grew, the rate of corruption too grew. Though government took some stern measures, including the execution of few very corrupt officers in the public sector companies, the culture of corruption penetrated in to various levels of the system. There are indeed relatively more concerted efforts led by the government to counter corruption and now a new anti-corruption law. Many of the local Civil Society Organizations and NGOs are now increasingly involved in tracking the public budget and exposing corruption. But the new economic elites in collusion with the old power elites seem to have developed a new nexus- undermining the promised and values of socialism. The powerful Communist Party and Government try hard to fight corruptions within and beyond. The economic growth also brought in a new culture of consumerism and communism is more like sense of old consensus and nationalism rather than a paradigm for social transformation. The young people told me that the most boring thing in their University Education is the compulsory course on Marxicism. When Marxicism becomes a mere text book to be taught, dictated and followed, even the best streams of humanist experiments can become a boring dogma. That is the tragedy of Marxism within the comedy of a consumerist young generation who are keener to catch with the best of the world in the shopping malls and the cyber cafes.


In spite of the new challenges and certain restriction to the press freedom and political mobilization beyond the Party frontal organizations, the overall record of the Communist Party and governance in Vietnam is impressive. It helped to create a broad base of an educated middle class with millions of mobikes. In a country of around 89 million people, there is a very inspiring story of the government and NGOs working together in a coordinated fashion to reduce poverty and injustice. The inequality has increased. There are few new young millionaires. Land speculation is high. The cost of living in the cities is spiraling upwards. The inflation is more than 23%. But still the government is very much in control. Per-capita income has increased to more than US$ 800. From a food deficit country, the country has emerged as one of the large exporters of rice. Though Vietnam which fought one of the most difficult wars with the American Army, it has now a booming trade with USA. A more confident, better educated and economically active middle class ensure a very important balancing act of political culture and economic growth.


There are many things to learn from Vietnam and Vietnam too is in the process of learning and adapting new policy process from across the world- in terms of governance, civil society, development and democracy. Last year when I had a chance to meet the Polit Bureau members of the Communist Party, they have very explained their vision of balancing the economic growth and market process, along with socialist principles and social policy paradigm- what is generally termed as Market Socialism. Vietnam seems to have combined an element of democratization at the grassroots level along with a conscious and concerted agenda on social and economic development. In spite of a single party government and restrictive environment at the macro level, the government encouraged grassroots democratization process, women’s empowerment, and strategic plans for local development. In spite of being a Government led by the Communist Party, Vietnam provides ample space for the NGOs to operate in coordination and collaboration with various governmental and civil society processes. After all economic growth is not a bad idea- when it is combined with the commitment for social development and justice. The negotiation of Vietnam with market did not compromise its agenda for Social Development. However, Vietnam faces new challenges of corruption, inequality and inflation.

The story of Vietnam is the story of survival, sustainability and renewal. It is such a story that makes most of the Vietnamese dignified, confident and proud of their country.

Friday, October 3, 2008

Towards the Solidarity Economy

John Samuel

Keynote presentation at the Asian Conference on Solidarity Economy and socially responsible Business on October 3, 2008 in Bangkok



Ethics is what makes the economy humane- an enabling force for exchanges among people, societies and countries. Devoid of ethics, economy can perpetuate predatory forces of dehumanization, commodification, violence and war. Economy needs to be an enabling process that helps human beings and environment to sustain and thrive. And Economics devoid of ethics can be extractive, exploitative and imperialistic. In fact, both Adam Smith and Karl Marx began their search for viable economy from strong ethical premises.

Solidarity is an act of identifying with other human beings with a shared sense of destiny, dignity and responsibility. Solidarity is based on the principles of mutual empathy, mutual support and the greater common good. Solidarity helps us to go beyond the greed of the self to the need of other people, societies and countries. Solidarity does not depend on the principle of the ‘Survival of the fittest’. It seeks to promote the sustainability of human beings and environment.

Economy signifies an interface among human beings and societies that facilitates the link between natural and social resources to meet the human needs and comforts. Economy also signifies the dominant modes of production and distribution. The notion of market represents the dynamics of demand and supply of goods and services among human beings, societies and countries.

However, the market-place is not a neutral space of such exchanges based on demand and supply. Any mode of exchanges among human beings and societies are driven by power relationships and value assumptions. Hence the market place is inherently political. The key question is whether the dominant power-relationships and political process within the market shape the choices and values of human beings or whether a universal framework of human values and sense of solidarity drives the power relations within the market. The assumption behind the free market economy is that the invisible hand of the market is capable of dealing with all human demands and needs in an efficient way. However, the so-called free market economy is driven and controlled by few very rich companies and few powerful countries. Most of the poor countries and poor people at the receiving end of the so-called free market economy. The Solidarity Economy is a critique of the extractive economic paradigm of the free market variety and at the same time it is an effort to build alternative vision of an ethical economy. The alternative search for the solidarity economy on the one hand seek to promote an ethical normative framework for a people-centered economy and on the other hand seek to learn from the various practices of enterprises and business based on the principles of solidarity.

Solidarity Economy is an effort to reiterate and rediscover the ethical basis of a viable, sustainable and socially and ecologically responsible economy. Here are some of the perspectives on the Solidarity Economy:

1) Ethical basis for a solidarity economy needs to be based on the values of cooperative solidarity, economic and ecological sustainability, accountability, human rights, democratization, diversity and justice- social, economic and ecological.
2) Seeks to promote alternative practices and thinking to challenge monopoly capitalism and exploitative economic paradigm. Market is too important to be left to the fancies of finance capitalists in search of perennial profits and their subservient policy makers

3) Seeks to democratize economy, knowledge and technology.

4) Seeks to promote fair profit in a vibrant and enabling market place It places people and environment before the profit

5) Promoting Local Economies that are accessible and affordable to the poor and marginalized people.

6) Would advocate for trade justice and national and international public policies to promote fair trade across the world.

7) Anticipates long term social and environmental consequences of economic behavior.

8) Proactively seeks to engage with stakeholders to promote accountability and to make them realize the consequences of their actions at the market place, society and the world.

9) It promotes the public policy perspective that those who have greater economic resources at their disposal have a greater responsibility towards the society and environment.

An Economy which creates monopoly of power- through monopoly capitalism and imperialism- will undermine the values of democracy, human rights and perpetuate violence and war. Wherever there are human beings and wherever they exchange goods and services, there will be a market. But the question is what are the guiding principles of such exchanges, and who control the modes and manner of those exchanges. When markets and economy get captured by few forces of monopoly and those who have unbridled thirst for profit and power, the ordinary human beings become the victims of the market- without any sense of agency or bargaining power.

The solidarity economy perspective is not against the creation of wealth. It supports ethical entrepreneurship and human creativity and efforts to create wealth. Competition is not a bad word. But exploitation is an obscene act. Profit is necessary to sustain any vibrant economy- as profit helps people to create enough surpluses for the greater good. But profit becomes obscene when it based on extracting and exploiting people, nature, countries and continents.



The Solidarity Economy is based on four ethical pillars of Ethical production, Ethical Investment, Ethical market and Ethical Consumption. The solidarity perspective seeks to reiterate that human beings are capable of cooperative solidarity and ethical business. The Solidarity Economy is for fair profit and viable and sustainable economic paradigm that sustain environment, people and societies.

The solidarity Economy perspective seeks to encourage people and communities to enter the market and assert their capacity to negotiate and bargain in the market. Such perspective promotes vibrant local economy – including production and exchanges of services at the grassroots level. The democratization of economy, transparency and accountability of the investors, producers, market and consumers are the defining forces of a solidarity Economy.



1. Ethical Production.


Human beings will have to produce both goods and services for their survival and comforts. Ethical production will be guided by the basic values of human dignity, fair wages and conditions of work and environmental and social responsibility. The Solidarity Economy perspective seeks to support small and media scale enterprises and sufficiently decentralized production practices. Most of the poor people are producers as well as consumers.


It may not be always possible to have small or medium level productions modes to serve the need for growing economies and demand. So it may also be necessary to have big production facilities of goods and service. This where it is important to ensure the corporate accountability to the workers, communities, shareholders and consumers. It is important to move beyond the usual public relations rhetoric of the “corporate social responsibility to Corporate Accountability. However, the fact of the matter is most of the big multinational corporations, while subscribe to the rhetoric of corporate social responsibility, tend to have scant regard for any accountability mechanism. Many of them tend to violate the statutory regulations, perpetuate corruption of politics and economy, and tend to maximize profit at the cost of workers, communities and environment. Solidarity Economy perspective seeks to demand strong ethical guidelines- such as corporate accountability, ecological sustainability, human rights, and fair wages.


While the value of their labour does not increase the prices of consumer goods keep increasing. Most of the small and medium level farmers who produce agricultural commodities hardly get any bargaining power in the market place, as most of the time it is the middle men who often tend to control and influence the market. The producers often do not get any opportunity to bargain with the value chain and get fair returns for their labour


2. Ethical Investment


Ethical investment is based on the basic values that motivate the process of investment. Here, investment is not merely a means to maximize profit, but also a means to serve the large society in terms of generating gainful employment, protecting the environment, promoting human rights and democratization. Ethical investment place people ahead of profit. While ethical investment too seeks to make profit, it will challenge the unbridled and unethical thirst for profit. Ethical Investment requires transparency, accountability and social responsibility in the process of seeking a fair return on the investment.


Ethical investment is not merely about finance. It involves investment in terms of time, resources, ideas and process for the greater common good of humanity and environment. It would actively discourage investment in those industries that perpetuate environmental pollution, unbridled greed, violence and war. Ethical investment is both about the choices of values and the manner of investment.


3. Ethical Market.

Market is a means for exchanges of goods and services. Ethical Market is a means to serve the larger society- in a fair, predictable, efficient, effective and sustainable manner. Market is necessary for all our social and economic sustenance. However, when Market becomes God, the power tend to get accumulated in the hands few who would use market as a means to amass wealth and power at the cost of basic values.

An ethical market is an important link between investor, producer and the consumer. The so-called Free Market has been never free. Hence, it is important to have optimum regulations by the state and the society to make sure that market is a means to serve and exchange. It is often those middle men who control the market. Traders tend to control the market forces through influencing the finance market, commodity market and consumer market. The principles of an ethical market should make sure that the producers and workers do get fair returns and consumers do get quality services and goods.

While the State should encourage and enable ethical market mechanism, it is not the business of the State to control the market. It is important to have optimal regulatory mechanism to protect the local and national economy from the predatory finance and speculative capitalism.


4. Ethical Consumption.One of the reasons for the environmental degradation, increasing inequality and increasing morbidity is the unethical consumption. When market and money become the God, they are means of desire. The modern markets tend to demands through selling desires. Advertisements are the means for selling new desires to create new demands for the products and services. As a result people tend to derive their sense human self-worth not through creativity but through consumption. When people tend become less creative and more productive, consumption becomes a mode of life itself. The rich countries and people waste huge amount of precious resources – including non-renewable energy- through unethical consumption. Unethical consumption focuses more on the self, than the society. Unethical consumption focuses more on the status of the consumer rather than sustainability of the environment.


Ethical consumption needs be based on the values of need, environmental sustainability and social responsibility. An ethical consumer will ask the question whether the products and services that he/she consumes harm human beings and environment. Ethical consumer will always discourage wasting resources- particularly food and energy- and seeks to share and maximize the use of the consumer goods and services.

The resources of the earth are not limitless. It is increasingly clear that exponential growth of human activity and market forces damage the ecology of the planet. A relatively small minority of people and countries tend be richer and richer and large majority of people are impoverished every day. This is unethical. This is what solidarity Economy seeks to challenge and change. The Solidarity Economy seeks to humanize the production, investment, market and consumption. It seeks to challenge the commodification and dehumanization at all levels. It is based on the principle of creativity, community and communion. Solidarity Economy is local and global at the same time, where every consumer is a citizen who can claim his/her right and seek to enlarge the freedom of others.

The Solidarity Economy seeks to enhance and enlarge human freedoms to enjoy and sustain life and environment. It seeks to economic and political empowerment of all people across the continent, cultures, gender and colour. It seeks to challenge imperialist economy and politics- an economy of violence and war. It is a search of an enabling economy and empathetic market that would help us to expand our choices in a sustainable, responsible and just manner. As Gandhi said, we have everything to meet everyone’s need but not greed. The solidarity Economy is one more step for us and the next generation to reiterate that “Another world is Possible”

Thursday, September 18, 2008

An Agenda for Social Development

19 Sep, 2008, 0413 hrs IST, ET Bureau
The Economic Times, New Delhi.


By John Samuel

Development is the expansion of human freedoms to enjoy and sustain life and environment. Development involves strengthening of the capacity of human beings to realise the full potential of human creativity for the greater common good of people, society, environment and civilisation . Human dignity and democratisation — social, economic and political — need to be the defining force in the envisioning and process of development.

Economic growth and social development should feed into each other to empower people and the nation. Empowerment of people involves the ability to ask questions, seek solutions, make strategic choices and claim human rights. India is empowered when its people are enabled, educated and empowered. An agenda for social development needs to be based on transforming India economically and socially. We need to envision a process of social development that help economic growth, protect environment and strengthen just and democratic governance. We have to strengthen economic growth that helps us to decrease social and economic inequality.

An agenda for social development should prioritise five key areas: food sovereignty, women’s empowerment, universal quality education, universal primary health care, and the right to livelihood. We need to envision a new partnership between the government, non-governmental organisations and the corporate sector to make India free of hunger and poverty in the next 20 years. This requires new imagination, investment as well as a transformation of our governance.

Food sovereignty calls for a long-term strategy to increase food production and distribution by revitalising agriculture, particularly the small and medium-level agriculture. This would require new investment in technology, rural infrastructure, support for small farmers and a viable market mechanism. The most important challenge is to develop sustainable agriculture without harming the environment.

In spite of India’s economic growth, we are far behind in terms of ending poverty, malnutrition and maternal mortality. Social, economic and political empowerment is a crucial step in addressing both causes and consequences of poverty. There is evidence that reveals a correlation between women’s empowerment and social development. We need to increase our investment, manifold, to ensure women’s empowerment at every level of the society. Women’s right to land and access to other productive assets are crucial. There has to be special focus to strengthen women’s self employment and their right to livelihood. In most of the poor families women are primarily responsible for food security and nutrition. Hence, there has to be a universal programme for economic empowerment of women.

It is important to go beyond the minimalist ambition of universal primary education and seek a vision of universal quality education at all levels. While there has to be an intensive five-year strategy to make sure every single child will have access to affordable and quality education, we also need to have a whole strategy to create a highly skilled workforce through dramatically increasing vocational streams of education, particularly in consonance with the demands of the growing economy. The key to long-term social and economic development is quality higher and technical education , particularly with special focus on research and developing technological solutions. While we have to commit around 8% of GDP for improving education, this can be done only through new financing mechanisms. A new partnership among government, non-governmental organisations and the corporate sector is needed. A mix of public and private financing is also necessary. Education is a key lever for economic development. However, the state has to ensure access to quality education to everyone, especially those who have been historically marginalised. Education is an arena where we can combine the agenda for social justice and economic development.

In the past 20 years, quality and access to primary healthcare have decreased even in relatively more advanced states. Access to affordable primary health care should be able to address issues of maternal and infant mortality, malnutrition and increasing instances of communicable diseases, including malaria, TB and HIV. However, this may require a whole new strategy for public health in India. Public investment in primary health care is low in India. That has to go up. Local self-governments should be made responsible for the management of primary healthcare institutions and primary education. A new partnership between local selfgovernments and community-based organisations at the grassroots level is possible. State and central governments may invest in developing basic infrastructure and set minimum standards of service and quality, but operational responsibility should be with local self-governments.

The agenda of social development meets the agenda of economic growth in the area of the right to livelihood. Social development and economic growth are two sides of the same coin. New strategies to ensure rural livelihood, which may include agriculture, agro-industries, non-urban-based knowledge parks, and revitalisation of small and medium scale industries in the rural area, are needed. This will slow the unbridled rural-urban migration in search of livelihood and regenerate rural market and economy. Programmes under the National Rural Employment Guarantee scheme should create enabling assets for rural economic generation and long-term employment opportunities to satisfy its intent.

It is important to develop a 20-year perspective with clear operational strategies focusing on these five pillars of social sectors. This also means finding new financial and institutional resources to ensure the concerted, continuous and sustainable efforts. It is in the long-term interest of the corporate sector and key economic actors to ensure social development to decrease inequality and strengthen and democratise governance. Entrenched inequality, poverty and marginalisation are recipes for increasing violence, and consequent social and political instability. Political and social stability is crucial for economic growth and development. It is all the more reason for combining the agenda of social and economic sector development with a vision of a strong, stable, prosperous and peaceful India, an India empowered enough to transform the world.


(The author is a policy expert and the international director of Actionaid)

Wednesday, July 16, 2008

Imagine a New SouthAsia!

John Samuel


Imagine a New South Asia- where borders will be transformed in to bridges and bonding; where all children will go to school, where no one will go to bed hungry; where the human rights of minorities will be respected; where there will be more prosperity and peace, rather than war and violence; where people can rise above the narrow walls and interest to share a common destiny of the peoples’ of South Asia-one the biggest resources of people, culture and civilzational space in the world.

Let us imagine a new South Asia- that can transform itself and the world. Let us imagine with passion and conviction about the immense possibilities of a South Asia driven by prosperity, peace, democracy and mutual trust; a South Asia, where the autonomy and sovereignty of each country will be respected and at the same time we together seek to mould common futures based on shared commitment, interest , culture and a passion to transform our challenges in to opportunities, our poverty in to prosperity and our deeply entrenched mistrusts in to a sense of trust and mutual respect.

Many skeptics may say that it is a romantic dream- devoid of any sense of reality. However, dreams can be the beginning of a new dawn. In a growing climate of cynicism, young people should not lose the ability to dream about a New South Asia. Dreams can dare to challenge the constraints of past and present. We need to dream about a new South Asia- we need new dreams to heal the wounds that haunt us; we need a new dream that can transform our agonies and mistrust. My generation does not have to be the prisoners of the past. We can indeed be the shapers and makers of future- as shared sense of future of a New South Asia, with a new sense of political and poetical imagination. We need to rediscover a new poetry and politics in this primordial melting pot of cultures, languages, civilizations and human history.

The old South Asia is the balance sheet of the power equations that emerged out the rather the brutal process of decolonizing. Now it is time to outgrow from the past baggage of negativity - negatively defining our own different national identities- and of the deep mistrust that got nurtured by the powerful forces and countries of the world. As long as the countries in South Asia are more in to a mode of undermining each other and in to mindless arms race, we all will be dependent more on other powerful countries for aid, arms and arbitration. The issues of poverty, politics of exclusion, communalism, extremist nationalism, discrimination, and environmental crisis in the region are very much interwoven and intermingled. While the neo-liberalization had created a minuscule minority of upward mobile urban upper middle class, the balance sheet of neo-liberal policy prescriptions does not look bright. There is growing inequality, displacement, trafficking, conflicts and violence. The aggressive neo-liberalism not only undermined the small farmers, and small scale agriculture, it has also created a large vulnerable middle class- who have not gained much out of the of the economic globalization. More deprived rural farmers and an increasing number of vulnerable middle class, particularly young among them, fall pray to various kind of religious fundamentalism. The reactionary politics of “negativism’ and religious fundamentalism is often turned against the immediate “other” or the “other” neighboring country. This negative sense of identity and “patriotism’ perpetuates a social psychology of mistrust as well as a tendency to “externalize” the problem and blame it on the immediate neighboring country. It is an easier short-cut for a political class who will rather blame others rather than taking responsibility to address problem or an issue with a positive agenda. It is easier to mobilize the people against a perceived “other” or an “imagined” enemy. Such politics of hate and mistrust tend to mobilize the semi-literate or illiterate masses against another country- or an imagined enemy within or across the border. They transplant their “patriotism’ to a game of cricket or to allegation against “illegal” migrants from across the border. In most of the countries in the region, national identity or “patriotism’ is not defined in terms of positive identification with culture, people and history. Patriotism” is often identified in negative relation to another country in the region. So the “indianess” is defined in negative relation to Pakistan or Bangladesh or the other way around. It is important to develop a sense of South Asian identity beyond our own sense of imbibed sense of “nationalism”. We need to exorcise the ghosts of the past within our mind and political discourse. We, as South Asians, have much more in common – in terms of language, culture, food, music and tastes- than any set of people in this world. Hence, it is important to find lasting solutions based on mutual cooperation, collaboration and joint efforts to address the issues of inequities, injustice, mistrust and conflicts in the region.

The fact of the matter is that largest number of poor people live in South Asia. We as a region is most vulnerable to natural, social and political disasters. There is whole range of violent politics and range of extremism and terrorism in South Asia. Conflicts over natural resources, identity and inequality are on the rise in South Asia. While most of the governments give lip-service about SAARC, no one seriously invest in making SAARC a viable and effective South Asia forum. Unless we challenge and change this situation, South Asian countries will remain poor, with a growing club of few billionaires. The growing sense of injustice and inequality will perpetuate new conflicts, spiraling defense expenditure and undermine democracy and development across South Asia.


The primary responsibility of challenging and changing the condition to a large extend will depend on the attitude and approach of India to its neighboring countries. India is perceived as a hegemonic and arrogant power by most of the people and governments in South Asia. And there is a deep sense of mutual mistrust and mutual undermining between Pakistan and India. Such a situation makes SAARC as one of the most ineffective regional forums in the world. Transforming this situation demands a transformation of the approach and attitude of the government of India. India, with a growing economy, technology, and a democratic polity, can indeed play a much more enabling and empowering role in South Asia, instead of a hegemonic role and rather aggressive posturing. The first step towards lasting peace in the region is to develop workable and realistic solutions to entrenched conflicts in Kashmir and Sri Lanka, without undermining the sovereignty and integrity of the countries involved in the conflicts. This also means evolving a broader framework for addressing issues of conflicts within countries.

However, the firs step towards such a process should involve developing a set of positive social and cultural agenda that can be owned by all countries of the region. It is important for India and Pakistan to reach a common minimum programme to reduce the conflicts and mistrust. Though there has been significant improvement in the relationship between these two countries, they are not good enough to transform rather depressing situation of the region. Once there is more trust and mutually enabling attitude between these countries divided by a sort of iron curtain, it is indeed possible to develop a clear South Asian agenda and joint programme, with support of Bangladesh, Nepal, Sri Lanka, Bhutan, Afghanistan and Maldives, to ensure poverty eradication, universal education, technology transfer and disaster mitigation initiatives. It is also imperative for South Asia to develop a framework for human rights.

While a South Asian Federation may be an idea whose time has come, it is important to work towards creating enabling conditions for such process among the peoples and governments of South Asia. It is important to unleash our positive potential on a set of positive social and political agenda. The first step towards is to create enabling environment for free movement of people, and to begin with provisions for visa on arrival in all countries.

Here are seven possible policy options towards paving the way for a New South Asia:

1) A South Asian People’s Parliament. It is indeed possible to conceive a South Asian people’s parliament where there will be a sense of equal grounding for the big and small countries of the region- where different sections of the people can be represented. This process can evolve over a period of five to ten year, though it is possible to make a modest beginning of South Asian People’s Parliament. One can learn lessons form European Parliament and Africa Union. This parliament can discuss key issues that confront the region and come out with common policy framework and solution on social and economic sectors.
2) A South Asian Education Fund: The key for unleashing the potential of South Asia lies in univeralisation of education and a joint investment in higher education, science and technology. This would enable the emergence of an educated middle class across South Asia. The presence of educated, enlightened and liberal middle class is indeed important for the sustenance and growth of democracy and economic development in the region. India can play a role in initiating this Fund, and also helping to establish Institutions of excellence for science, technology and management in different countries of South Asia.


3) South Asian Climate Change Management and Disaster Mitigation Framework. The issues of climate change and natural disasters in the region will have an impact across the borders. Environmental impacts and natural disasters do not respect any national “borders” and hence there is a need for a joint fund and mechanism to address the causes and consequence of environmental crisis and natural disasters.
4) South Asia Poverty Eradication Programme. Poverty is one of the crucial stumbling blocks for peace and regional cooperation in South Asia. If there is a joint fund, joint framework and joint effort to address issues of poverty through shared policy framework and approach that can indeed bring positive dividends for peace and prosperity in South Asia. As long as our countries have entrenched poverty, inequality and injustice, we will not be able to move towards a vision of peaceful, prosperous and peoples’ South Asia.

5) A South Asian Charter on Human Rights will help to develop a framework to protect the rights of minorities in each of the countries, and also ensure a framework for realizing the Economic, Social and Cultural rights of people.

6) A South Asian Economic Management Framework. This could include a mutually enabling and supporting trade framework, a shard framework for fiscal policy, a possible South Asian currency and a joint framework for supporting economic growth of each country through developing knowledge, technology and an optimal market.

7) A South Asia Charter on Human Right to Food for supporting small agriculture and regional buffer stock of food to address potential food crisis.


The idea and imagination of a New South Asia will have to be discussed and debated among peoples of South Asia. People across South Asia will have to be mobilized for towards a new vision of peaceful, prosperous and peoples South Asia- a South Asia without poverty where every person and community can live with a sense of dignity. It is imperative for India to bring about a paradigm shift in its approach in the region, to transform itself from a hegemonic and arrogant power to an enabling and supporting country that can treat all its neighboring countries as equal in letter and spirit.


It is time to rediscover the dream of Rabindranath Tagore:


WHERE the mind is without fear and the head is held high
Where knowledge is free
Where the world has not been broken up into fragments
By narrow domestic walls
Where words come out from the depth of truth
Where tireless striving stretches its arms towards perfection
Where the clear stream of reason has not lost its way
Into the dreary desert sand of dead habit
Where the mind is led forward by thee
Into ever-widening thought and action
Into that heaven of freedom, my Father, let my country awake

It is time to rekindle a politics of hope. We need to go beyond the politics of protest and mistrust to a new politics of proposals and politics of transformation. We need to make a new tryst with destiny in South Asia.