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Saturday, May 28, 2022

Work, wealth and welfare

In a democracy, good or bad, the cause being external factors or internal developments, the government must bear responsibility. Good or bad, governments must be changed. A sense of permanence is the cause of the beginning of a downfall.

Written by P Chidambaram |
Updated: December 28, 2020 9:24:17 am
A combination of unemployment and slow (or negative) growth will impact welfare.

Mercifully, the year 2020 is coming to an end. Every country is bruised, some are battered. Covid-19 has not gone away, but it is less threatening, and the vaccines that are being distributed give us hope. As far as India is concerned, our economy is battered and the lives of millions of people (especially the migrants and those who lost their regular jobs) have been severely bruised. Further, the divisive and polarising utterances of, among others, Mr Amit Shah and Mr Adityanath have torn the social fabric asunder.

The abiding lesson of 2020 is that a nation will suffer if there is a decline in three measures — work, wealth and welfare. I wish to devote this year-end column to reflect on this lesson.

Work: Ultimately, it is work that distinguishes one human from another. There are many thousands who do not have to work, yet they do, because work is pleasurable, enhances esteem, earns rewards and determines one’s standing among peers and in the society-at-large. At the other end, there are millions who need to work, but cannot find work; they are the unemployed. By last count, the unemployment rate in India was 8.7 per cent (CMIE, December 22, 2020). In between, there are people who do not wish to join the work force and there are people who are home workers who are not counted as part of the work force.

Unemployment is always a huge challenge in a developing country like India. The rapid decline in growth rates (2018-19 and 2019-20) triggered the rise in unemployment, the pandemic made it worse and the unplanned lockdowns exacerbated the situation. At its peak, 130 million persons lost their jobs or livelihoods. Jobs have come back slowly, but some jobs have disappeared permanently. The figures speak for themselves (see Table).

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Wealth: The most easily understood measure of a nation’s wealth is the Gross Domestic Product. If the GDP grows, wealth is enhanced, and the average share of a citizen in the pie (per capita income) is larger. I have taken the simplest measure: GDP in constant prices. Look at the slow growth rates after 2017-18 and look at the destruction of wealth in 2020-21 (see Table). Not at all encouraging for a developing country that has many millions who are poor. Is it any wonder that among the people there is pessimism about the future?

Welfare: A combination of unemployment and slow (or negative) growth will impact welfare. My concern is not economic welfare alone. Food, healthcare and social security are indeed important, but welfare goes beyond material and tangible goods and services. Ask yourself some questions: Do people think they are a free people? Do they have a heightened sense of fear? Are people afraid that presumably independent agencies like the CBI, ED, Income Tax Department, NCB and NIA will hound and persecute them? Are people confident that the courts of law are accessible and will render swift justice? Can two young people be friends, go out together, fall in love and marry? Can one, according to her choice, eat, wear clothes, speak, write and associate with other people? ‘Welfare’ is the sum of these things. Some indicators where India stands, in relative terms, are the Human Development Index, Index of Freedom, Press Freedom etc (see Table). Overall, there is a decline.

Three Abiding Images: In a democracy, good or bad, the cause being external factors or internal developments, the government must bear responsibility. The government may be well-intentioned, get the best available advice or may have committed unintended errors, but the buck stops with the government. Good or bad, governments must be changed. That is why, in many countries, there are term limits on Presidents and Prime Ministers. A sense of permanence is the cause of the beginning of a downfall.

As we end the year, the three abiding images of 2020 are:

1. The millions of migrants — tired, hungry and sick — trudging hundreds of kilometres along highways and railway tracks with their meagre belongings to reach what they believed was home.

2. The long and peaceful protests — first at Shaheen Bagh and now on the borders of Delhi — demanding that the government hear them and heed their appeals for justice.
3. The resounding vote in the Kashmir Valley comprehensively rejecting the unconstitutional coup staged by the government on August 5, 2019.

In sum, Work, Wealth and Welfare suffered in 2020, making it a forgettable year. I urge you, however, paraphrasing George Santayana, never to forget 2020 so that we may never repeat 2020. Instead, be proud, fearless and freedom-loving Indians. I wish you a happy, healthy and prosperous 2021.

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