Neo-liberal capitalist development does not have to bother about decreasing employment potential or impeding economic crisis today. Intoxicated with galloping figures of GDP, the innocent masses are misled into believing that there is growth and development in the economy within. The truth is that majority in our country are suffering due to deepening economic crisis.
Corporate growth based model may present shining figures of growth, but actual facts and figures about Indian economy are scaring. While GDP growth is presented as economic development, in reality, GDP indicates growth of industrial and service sectors. To develop the country’s economy, one needs to take into account the national average income of people, their living standards, among other things. As a matter of fact, in the UN report on the performance of various countries, India stands lower than even Sri Lanka. One really wonders where we would manage to stand if measured on the lines of Bhutan’s happiness index.
GDP growth no doubt reflects national income in a way. But the question is the nature of system that generates GDP. Critiques of neo-liberal economic development normally call it as crony capitalism but actually there is the running thread of collision between state and corporate throughout the development process of capitalism in all its stages. Meanwhile, the truth is that capitalist is not looking for profits in non-productive sectors, it is interested in the kind of investment that can neither generate employment nor can bring down the price of any commodity. Hence the capitalism that actually discourages production unlike crony capitalism, could be attributed the name of casino capitalism.
This world-wide chase for profit by free capital and the so called forward march of GDP was also witnessed in the case of Latin American countries and Asian tigers of 1990s. This flirting capital keeps baiting for profit by “taking over of profitable industries” and “investments in stocks”.
To understand this process we can take the case study of the experiences in sugar industry. In 2009-10, this industry had seen a great leap, though credit goes neither to the rise in production, nor that of sugar prices. The BSI of 33 sugar companies rose 2900 times to deliver 901 crores rupees compared to more 30 crores of 2008. As per experts, if the contribution from unlisted companies and cooperatives is included this may go up to 1802 crores. The sugar mills running into losses in the third quarter of 2008 started earning profits by 2009 because of rising prices. In the case of Balarampur, from 29 to 76.55 crores, Triveni engg from 23.98 to 72.94 respectively. Similar is the story of Bajaj, Hindustan, Simbhevali, Mavana and others. Turnover too was appreciated by76 percent. All this affected the GD positively. As such, GDP has no relation with production. In 2010, when experts and agricultural ministry had made the forecast of rise in sugar production, the stock value of listed sugar companies actually decreased by 8 to 11 percent.
In 2000, sugar production was 185.27 million ton and by 2010 it went up to 243.94 million ton. But consumption figures did not grow proportionately. Neither price of sugar came down. This kind of anti production trend can be observed in other sectors too. Retail trade also exemplifies same trend. Retail trade grew to 109,009 crores in 2010 from 35000 crores of 2004-05. This growth is due to price rise actually. Prices rose because speculators and hoarders were gifted with desired amendments to essential commodities act. Prime minister Manmohan Singh would like us to believe that this price rise is due to rise in the personal income of Indian people, they are earning more and spending more. But actual growth rate in consumption is not proportional to price rise.
Milk consumption grew 51 percent during the last ten years. But prices went up by 156 percent, a hike of three times. Rice consumption grew 12 to 15 percent. But price of rice rose up by 136.36 percent. Same happened with pulse and oilseeds. And with cars. From 2004 to 2014, sale of a particular model of cars grew from 53171 to 199,000, 274.26 percent. But prices of cars rose just 18.35 percent.
Well we may conclude that we are thinly populated, and travel a lot! Well, starving people enjoying swift car ride! What a rosy picture neo-liberal economic policies gives us!
After getting ‘liberated’ from the political pressure of left, Manmohan Singh had pursued his policies with vengeance; during UPA-II, during 2009-14. The whole country was converted into a sort of gambling den. Inflation touches the sky. People are feeling miserable due to unprecedented price rise. But the rulers are celebrating their success in achieving greater GDP! What a relief to starving people. Forget hunger. Feel good by seeing the figures of growth of GDP.
Actually, this is the game of the rulers to fool the people by projecting the growth of GDP as an indicator of economic development. Those who want to project neo-liberal economic development in a positive way, have been always playing these games with statistical figures. They keep declaring constantly that the number of people below the level of poverty line are reducing day by day. Professor Arjun Sen Gupta committee report actually exposed these false claims by showing that 79 percent of our population is living with just rupees 20 as daily income. Later Tendulkar committee report had shown that 37 percent of our population is below the poverty line, contrary to the claims of planning commission that only 26 percent are below the poverty line.
The truth is that to call the economic policies pursued by Dr Manmohan Singh as based on free market in itself is conceptually wrong because even though, we find private ownership being promoted, there is no room for real competition among capitalists. It is actually increase in monopolization of each and every sector in the hands of few private players. It is the market that is at the centre , not the consumer in this model of development. No wonder that only a very small section of the society really harvests the benefits of this development. Just 18 lakh families are in the category of 45 lakh rupees annual income. The wealth of 80 crore workers and peasants of our country has gone in the hands of 35 corporate families. This uneven economic development is also reflected in cultural and social spheres of life of the people in our country.
Time has come for us to declare that this model of development is illegal and illegitimate and to launch struggle to overthrow this with all our determination.
Casino Capitalism, A Neo-liberal Venture