Tuesday, May 31, 2005
Transition From Armchair Idealism
Recently I had a conversation with my uncle Suresh when I shared with him my ideas about the ills of capitalism. After listening to what I said he pointed out to me that I am enjoying the benefits of capitalism. For me it was an eye-opener especially coming from a family member. While I subconsciously knew this anyway it was something that no one else has confronted me with.
There are a lot of contradictions in my life. I am used to a certain lifestyle and maybe that is why I am not considering being a full time journalist for the time being, as it is not likely to be as remunerative as other options. The other reason being that I want to be financially independent. And yet while accepting this reality I will never work for companies like Pepsi or Nike, which are monsters created by capitalism.
What I hope to lead is a balanced and sustainable life with as minimal contradictions and compromises as possible. The call center industry is an irresistible proposition to start this with. Look at it. It brings in money into our economy, while also denying employment to people in the U.S.A, for instance. But I can tolerate such an industry for just a few years utmost, and eventually I am sure I will muster the guts to do journalism or even the rather more unrealistic movie direction for my bread and butter.
Yesterday I had gone for a movie with a friend. I was very thirsty and bought Pepsi. My friend remarked that I was being hypocratical. My response to such a comment is simple-if I see both Pepsi and Bovonto(an Indian brand), I choose the latter. I still prefer fruit juices to softdrinks. But I think I will be far more hypocritical if I pretentiously boycott the multinational colas, while not wanting to give up so many of the other benefits of capitalism. But I do draw a line somewhere.I will not for instance ever buy a Nike product. For those of you who don’t know Nike shoes are manufactured in sweatshops with appalling work conditions and obscenely low wages.
I have started taking small steps in the right direction. Starting to write is one such step as it forces you to examine yourself closely. Invaluable feedback like what I get from people like my uncle often plagues me with a sense of guilt. For other than a frugal contribution to the Tsunami fund (which made me feel good) in what way have I contributed in fighting the selfish system I so detest (capitalism)? Will I be able to make the transition from armchair idealism to proactive action?
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28 comments:
capatilism is a vaguely defined concept. u shud remember that under communist rule in sovieet union workers were paid absymally low wages, and for a communist\socialist society to function effectively it needs a dictatorship\unelected government, r u willin to accept that? i say thin because in capatilism there is a divorce btwn government and economy, in socialism there isnt this, and constantly changing policies pose a drain on fiscal resources as seen in india, a stable policy is required, this requires a unelected government
///It brings in money into our economy, while also denying employment to people in the U.S.A, for instance.///
:-). first time here.
i am agreeing with your views regarding capitalism partly.
Agreed, capitalism may not be perfect but try and picture the scenario without capitalism. How 'less comfortable' will our lives be without it?You don't have to drink Pepsi or wear Nike shoes to enjoy the benefits of these two companies.Just look at the amount of money they rope in to sponsor major events,cricket matches etc purely for our viewing pleasure.So I wouldn't really call it a selfish system as long as the economy benefits from it.
Nothing wrong with Capitalism my friend - one look at the way the Commies have fared, and you'll know which the better system is !
And call centers in India don't deny jobs to Americans : cheap indian call centers reduce the costs, which mean lower prices, greater demand, more production and so more employment. You lose your job, but you neighbour gets a new job. When you're thinking on a large scale, that's what matters. It's painful for each individual that loses his/her job, but its good for the economy in the long run.
Free Market Capitalism Rules my friend !
As for the sweatshop thing, you're right, it did exist. But at the end of the day, Nike (or was it Adidas) was forced to investigate. A great awareness campaign, consumer boycotts made sure that Nike couldn't get away with what they were doing. The big corporates always know that people are watching them, and now most big apparel bands carry a tag that says no sweatshop ( or something to that effect) , which in some ways, makes their products more marketable. Not sure about the details, but read it up.
Think of it this way - two systems. Communism and Capitalism. When you live under Commie rule, the state is supposed to provide for everything, has ultimate power. It's all very nice, until the state starts to screw you over. China under Mao , Russia under Stalin ...dude, look at North Korea ! The most closed country in the world today - that is what a world without capitalism ( and with a screwed up supposedly benevolent dictator ) will look like.
On the other hand you have a capitalist system, where markets are allowed to function (freely), and the state plays the role of a regulator - to prevent monopolies, protect consumers , citizens. In this system, consumers rule, they choose not to buy a bad product. And to make consumers buy their product, producers HAVE to make their products better , and cheaper. and so on ... consumers have a choice, and that drives standards up tremendously. Communism doesn't offer that .
Suggested Reading for you my friend: Saving Capitalism from the Capitalists - Raghuram Rajan. This is pretty much what's happening in the world today - Free Market Capitalism , in theory, can make the world a MUCH better place. However, the biggest threat to free market capitalism today are governments that impose trade barriers, tariffs etc. That is , too much state intervention that prevent markets from functioning efficiently - sounds commie doesn't it ?
hey siddharth!
how effortlessly you write...
I was drawn to read your blogs after reading your comment at kanishka's blogsite about 'advertising people'--and have been quite absorbed reading the wide variety you've been writing on--scrolling down...down...till i came to the one on advertising jewellery!! Well, it really made me think--especially as I am right NOW working on a campaign for GRT Jewels--and our idea is based on the insight that today's bride (my daughter for example) so hates her parents loading her with gold on her wedding day--mostly to please her inlaws...
so we're working on how today's young woman views 'wearable'jewellery, (while showcasing it fabulously of course,) but reflecting a more modern and sensible attitude in our copy...let's see how it works out, and hope it meets your approval too! thanks for giving our team something to think about too...will share what you wrote with them.
And guess what, I advertise Pepsi too! Please drink one on my behalf...or if you cant stomach that, get yourself some Aquafina. Meanwhile, keep up the good writing--and we'll get our fill of that!
Indu Aunty
Siddharth, you talk about Nike running sweatshops. Do you know where most of these sweatshops were located? In good old communist/socialist China!! Think!! :-)
first of all the arguement is not capatilism vs communism, rather it is the failure of capitalism to function effectively. the first major change in capatilist economics occured in 1930 when keynes pointed out the need for government intervention. now, in the 21st century the inablity of the government to provide social security for all, and the market too has failed. i would like to tel lthe anonymous commentor that free market capatilism cannot provide for all. that lesson was learnt during th egreat depression when the market could not come out of depression, inspite of it being theoritically possible. this many economists of that time, namely pigou marshall, robertson and others believed would hapen. now the biggest problem of capatilism is the inefficient pricing methods of natural resources, they are priced based on their extraction cost and not on their actual worth. the importance of fresh water in not reflected in its price
the question is not whether we sould revert back to communist rule, rather how better can a capitalist economy fuction, so that it can reduce exernalities and market failures while at the same time providing a basic standard of living for all.
tthe arguement capatilism vs communism is dead.
there is a quote about marx which says
'marx as a question is relevant, but as a solution he is not' i hope you would remember that.
my dear anpnymouc commentor, if there was no state interention then the market wont function effectively, keynes said that long ago, the great depression was a result of faith in classical macro economics (which advocates lessaiz faire)
I stand corrected :) I mean of course, government intervention when required. Like the New Deal Policy in the US in the 1930s.
What I meant to say, and should have been more specific , is that the best way to achieve a more equitable society is to have a government that aids and supports (and keeps in check) a market mechanism. Trying to supress a normally functioning market is not smart , in my opinion.
I agree with Srivatsan. The anonymous commentator said that "Free market capitalism, in theory, can make the world a MUCH better place". Yes - in theory. In practice it certainly will change things and may lead to economic growth. But only a small minority will benefit from this growth. And if there are no political instruments to organize and distribute wealth fairly, capitalism will create huge inequality (just compare the different wages of managers and workers in the USA).
As Marx said, the capitalist class is revolutionary, because it destroys the traditional relationships between people. But a free capitalism will only create a dictatorship of the market.
I think we need some global taxes on financial transactions (as it was proposed in the concept of Tobin) as an instrument of control.
mr anonymous i would like to remind u that a the defination of a which normally functions wel is not clearly defined in economics, the ususal indicators being increase in GDP. this is not a proper indicator of social development, and the welfare of the lowest (which indicates real progress in capitlaism because capitalism believes in the operation of the trickle down theory) therefore even in a properly fucntioning market, which functions efficiently there could be no real progress, GDP and per capita income cud increase, the former being a summation ofoutput and the latter being an average, which can be affected by extremes. and the market over the years has shown its inablity to deal with issues in the social sector, therefore they have to be dealt with by the government. now these problems are created by the marker (low wages, bad working conditions wages increases are usually followed by a price increase,this was the theory, increase the wage, and the price therefore real wages are constant, therefore wages are rigid therefore the government has to suppress the markets freedom to decide on such issues. so a government has no choice but to supress the markets freedom when it comes to factors determined by the market that affect overall welfare.
Agree with Christian on the idea of the Tobin Tax - throw some sand in the wheels of international capital markets eh ? But such taxes are NOT a long term measure, and must be used only as a temporary measure , when efficient markets need to be supressed.
Srivatsan, contrary to what is popularly believed , market mechanisms have actually worked in social sectors as well. A LOT of economists believe that that is the best solution to poverty - not a state that doles out money, or grants subsidies.
Don't get me wrong - I'm not syaing that everything should be left to the markets. State intervention is required when the market underprovides, or fails to provide crucial infrastructure like roads , power, telecom etc. However, I believe that it is not the state's role to provide these services all the time - it is the state's role to intervene when the market underprovides. Yeah sure, privatisation could lead to a case where inefficient state monopolies are replaced by inefficient private monopolies, but again, this is where regulation, anti monopoly laws come in by the govt. At the end of the day, a healthy, competetive market provides a much better product that a government monopoly - look at telecom in India ! Great service, cheap calls, and you don't ahve to wait years to get a phone connection.
Alright, I was rash when I was ranting about the virtues of a free market system. I guess I was jsut excited or something :P. But I still think that the cure for most socio-economic problems lies in a market-mechanism.
P.S: Venture Capitalists looking at micro financing is a perfect example of how capitalism could work in social sectors.
Sure, capitalism has been twisted and distorted by people in the black suits and all that. One look at the WTO and you'll see how lovely capitalism can be :P.
But Capitalism is also the reason Europe got out of the middle ages, is the reason why the US a superpower in the world today.
Does a "free market" exist anywhere? Maybe in the USA? There you can find the oil-industry taking over politics. And if economy is not doing well, they just start a war to improve it. That is certainly some kind of political intervention?
So the theory of the free market is only an ideology.
Coming back to your article, Siddharth, I think you are right when you say that one should support local products and not those of huge multinationals like Nike. But you should not feel hypocritical, if you can not be totally free from the capitalist system. None of us can completely escape from it - maybe only a sannyasin could do so...
Certainly capitalism got Europe out of the middle ages. But it has also been the reason for colonialism and imperialism, the slavery of millions of people, the exhaustion of the earth and our today´s ecological problems.
Today we need more coopertion and solidarity among the people, and not so much competion and greed that divides them.
We can argue forever people, but I think I'll leave now :) Enjoyed talking to you, comrades !
first of all i would rather not subscribe myself to any 1 particular ism.i am against totalitarian capitalism.mr anonymous if u have a bike or car i am sure ur very happy that the petrol prices have not shot up(which was a direct result of left intervention):)u seem to c d world as black or white...white for u is capitalism.mr.george.w.bush said ur either with us or against us...that in short sums of totalitarian capitalism.no tolerance to other ideas.
btw for any of u who think i am a blind supporter of the left do go 2 d april archives and read my article "who is tenzin tsundue?".
my friend mr.anonymous one final piece of advice the world is grey not black or white:)
I see lot of debate and confusion over which system is better. What you should do is not to make decisions based on half truths. If one does not understand something, its too premature to make conclusions.
For the so called capitalists, capitalism is no panacea. If u look at the us, where its practiced almost totally, the corporates run the whole show. Practically everything is controlled by the coporates. Be it local elections, judicial nominations, oil explorations, contracts awarded in conquered countries ! or foreign policy. Its so omnipresent that average citizens do not know life outside it.
On the other hand, for the so called socialists, the bastion of socialism (ussr) has collapsed and China is moving towards a capitalist society. The logic of the govt being the provider and the only provider has fallen flat. This only leads to inefficiencies and corruption at every level.
But that does not mean that socialism is wrong. Countries in europe still have a social economic model.
Even in india if none of the private airlines fly to non-profitable regions like say the North east, the state carriers will still fly there. Similarly for the telephones and other services.
Even in the us, the bastion of capitalism, there is social security.
Well, the right answer is somewhere in the middle - a bit of both the 'isms' perhaps.
Siddarth, to counter the argument that petrol prices have not shot up because left intervened, tell me something. Yes, we were happy about it. But the world oil priced did go up didn't it? Then who's paying the difference in the price? Where does this money come from? And also, the left has been hankering for PF interest hike to 12%. That 12% all you economic experts will know cannot be 'earned' by the government through market lendings. Which means the exchequer will be burdened by the additional 2.5% given on PF. So who pays?
WE THE TAX PAYERS. Last budget took off fringe beneft allowances and in turn our IT went up. So please remember that at one hand we are all very happy that the petrol prices haven't gone up, we ARE paying indirectly by tax hikes and various other means. The money can't come from 'elsewhere'. I'd rather prefer a more direct approach to pricing and market control.
The policies and views of left are skewed and at best primitive. The result as Mr. Anonymous pointed out are evident in USSR, West Bengal, Kerla and erstwhile China. I don't want communism that kills my creativity, self-drive and above all else freedom.
sridhar a litre of petrol would cost not more than 30-35 if the taxes imposed on them are rationalised, true the burden of taxation falls on the salried. but if govt. was more efficient then the fiscal situation wont be so bad. gove is overstaffed, around 15-20% of revenue goes into govt staff salries and pensions remember than. why shud u and i pay the salary of some useless corrupt official? who got in due to reservatoin?
do you also know that pepsi bottles are made from toxic waste that is handled by the helplessly poor??so what's the big difference between nike and pepsi???
I goto ration shop, RTO, telephone office, and registrar office and am ill-treated everywhere. I humbly return bitterly realising that all these people are paid from my tax.
Two classic examples of state-control and free-market are doordharshan and telecom.
If you were around during those Doordarshan period will know the quality of the content being produced today. A huge media revolution is happening today. Imagine, where would Barka Dutt, Rajdeep Sardesai and countless media personalities have been if only Doordharshan existed? And how often have you seen the card 'Rukavat Ke Liye Khed' in DD and how many times do you see them in Star or NDTV?
My dad paid Rs. 3000 deposit, a princely sum then and waited for nearly three years for a telephone connection. And even after that the line simply used to go dead every alternate months. I still vividly remember taking permission, writing a complaint letter and waiting longingly at the mercy of the clerk in DoT office. Today I have a phone hanging around my neck and I don't even know where RPG office is. And when was the last time your cell phone went dead for non-battery and non-payment reasons?
Let's not fool ourselves and romanticise socialistic communism. It's ancient, evil and anti-growth. I rest my case.
abt income tax...lets face it most ppl dont pay the amount of tax they r supposed 2 pay...chartered accountants are beavering all the time to find loopholes in d tax laws or even submitting false accounts...so who r v fooling?
sridhar we have long ocncluded that the arguement is not capatilism vs communism, but how best to make capitaism work to solve social sector inequalities, anonymous is saying that the market can take care of itself while i disagree, i think the merket needs to be guided. kind of like shepherding th emarket in the right direction, with the govt being th shepard. a free market (like china, though it is still communist or agrentina which was free b4 its collaspe) social sector inequalities continue to grow
whoa, this is as serious a stuff i've ever read in a blog:D.
i will take time to read and understand this subject fully.
I think it was narayana murthy or someone who said about "Compassionate Capitalism"
and for more info on globalisation privatisation and how ruthless it has been to the underprivileged, check out
"The Algebra of Infinite Justice" by Arundhati Roy.
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