Social Sciences and the Colonised Mind Prabhat Patnaik
A crucial component of the imperialist system is the colonisation of third world minds that helps to sustain it. This colonisation is pervasive, but here we shall discuss only academic colonisation and that too relating to the social sciences. Social sciences are of critical importance because the problems of the third world are above all social problems, and since the colonisation of third world minds has the effect of inculcating in them the belief that imperialism in the colonial era had nothing to with these problems (on the contrary, if anything, it had a beneficial impact), and that imperialism in…
Financial Markets Under Capitalism Prabhat Patnaik
One of the most important arguments advanced by John Maynard Keynes, the renowned economist, was that the operation of financial markets under capitalism is deeply flawed. Such markets are intrinsically incapable of distinguishing between “enterprise” where an asset is held because of the stream of returns that its ownership yields over time, and “speculation” where an asset is held not for this yield but only because it can be sold at a higher price tomorrow to someone else who in turn would buy it because he believes that he can sell it at an even higher price the day after…
Co-lending: Towards recolonising the peasantry Prabhat Patnaik
In colonial times, the peasantry had to borrow from private moneylenders. According to Provincial Banking Enquiry Committee reports, these moneylenders in turn borrowed from commercial banks. But while disbursing credit to the peasants and charging exorbitant interest rates, the money lenders at least bore the whole of the lender’s risk. The banks from whom they borrowed did not bear any risk in case the peasants could not pay back the loans they had obtained from the moneylenders. The banks in short had nothing to do with the ultimate borrowers. But with the new arrangement being put into effect, of which…
Yet Another Contradiction of Capitalism Prabhat Patnaik
In the United States there are still four million persons who remain unemployed compared to before the pandemic; and yet the Biden administration’s attempt to stimulate the economy has already run into a crisis with the re-emergence of inflation not just in that country but elsewhere in the capitalist world as well. The Federal Reserve Board (the equivalent of the US central bank) is planning soon to raise interest rates (that are currently close to zero), and even the fiscal expansion will be difficult to sustain in the face of inflation. All this will truncate the recovery that has been…
Privatisation and The Constitution Prabhat Patnaik
In a recent report the People’s Commission on the Public Sector and Public Services has rightly drawn attention to the sheer un-constitutionality of the Modi government’s plan to privatise en masse the assets of the public sector. The constitution of the country is not just a set of procedures and rules for the governance of the polity. It expresses above all a certain social philosophy which is supposed to inform the behaviour of the various organs of the State and which constitutes the foundational beliefs around which the nation has come into being. This is particularly true of ex-colonial countries…
US Inflation and India’s Economic Recovery Prabhat Patnaik
The very day, December 11, when the Indian finance ministry spuriously claimed a robust recovery in the post-pandemic Indian economy, newspapers carried news of an acceleration in the US inflation rate. The inflation rate in November 2021 over November of the preceding year had been 6.8 per cent in the US, which was higher than the corresponding rate in any month over the previous 40 years; in particular, petrol prices had increased in November 2021 by 58 per cent, which was the highest for any month since 1980. The Indian finance ministry however blithely ignored this inflation in the US…
India’s Post-Pandemic Economic Recovery Prabhat Patnaik
The pandemic alas is not yet over, but there are no economic disruptions in the current fiscal year in the form of lockdowns or workers’ absence. The economy’s performance therefore can no longer be attributed to the prevalence of the pandemic; whatever it is, it is caused by economic factors. Government spokesmen are busy claiming that the economy is displaying a robust recovery, and that the current fiscal year will post a double-digit growth rate. But a double-digit growth rate in the current year means nothing; since the previous fiscal year had witnessed a sharp absolute drop in GDP, in…
The Strangulation of the MGNREGS Prabhat Patnaik
The MGNREGS was introduced by the UPA-I government despite opposition from the neo-liberal lobby within it, owing inter alia to the active intervention of the Left which was supporting that government from outside. It was restrictive from the beginning: it promised a maximum of only 100 days of employment in a year, and that too for just one member of a rural household. But within those restrictions it conferred an economic right: employment could not be refused and if it was not provided within a certain period then the person seeking employment had to be paid a compensation. It was,…
The Peasantry’s Victory over Imperialism Prabhat Patnaik
Particular battles often have a significance that goes beyond the immediate context, of which even the combatants may not be fully aware at the time. One such was the Battle of Plassey, which was not even a battle since one side’s general had already been bribed by the other not to lead his troops against it; and yet what happened in the woods of Plassey that day ushered in a whole new epoch in world history. The battle between the kisan movement and the Modi government falls into the same genre. At the most obvious level it has been seen…
Fiscal Folly Prabhat Patnaik
The Modi government has been raising taxes on petro-products as its main instrument of resource mobilisation for government spending. This ironically has the dual effect of not stimulating the economy, but stimulating inflation instead. An alternative fiscal policy of raising resources through direct taxes on the rich (of which wealth taxation is the best possible option) and using those proceeds to increase government expenditure would have both stimulated the economy and kept down the rate of inflation. To see why this is the case, consider the following simple example. Suppose the government wants to spend an additional Rs 100 and…