In Part 1 of this series we spoke about ‘Strangers: The Power of the Common Man’, in Part 2, we talked, ‘Of Mundane Things: Manifesting Bread and Re-affirming Trust’ and in Part 3, we discussed the ‘Changing Contours: Re-imagining Intangibles, Design, Skill, Values, Tech & Governance’. In Part 4 we will focus on markets dynamics, the class hierarchy, their interactions in a political economy and what it means for long term governance.
I PANDORA’S BOX OF THE INVISIBLES
“Governments can pick winner, sometimes particularly well. The argument that government decisions affecting business firms are bound to be inferior or the decisions made by the firms themselves, is unwarranted. Having more detailed information does not guarantee better decisions-it may actually be difficult to make right decision, if one is ‘in the thick of it’. Moreover, decisions that are good for the individual firms may not be good for the national economy as a whole. Therefore, the government picking winners against market signals can improve national economic performance, especially if it is done in close (but not too close) collaboration with the private sector.”
-Ha Joon Chang, 23 Things They Don’t Tell You About Capitalism, 2010
The poor, penniless, proletariats, plebeians, pedestrians, proscribed, prohibited, penelope’s, and populace at large, constitutes the very ‘people’ whose presence at the bottom rung of the pyramid, empowers the pinnacle, enough to govern them from the pulpit. And today as much for the sake of the 99% on the bottom rung of the pyramid, as for the miniscule 1% at the top, it is imperative to ensure that the foundation holds, else the top will collapse with the implosion of the pyramid itself, as COVID19, continues to flatten us all, while it remains viral and at large.
The pandemic is a time for reflection on the vast inequality and prejudice that has got in built in our systems over the years and requires a drastic re-think with a bias in favour of the invisibles, the anonymous, the voiceless, the on the margins. As Raj Patel writing in his book, ‘The Value of Nothing’, cautions us, that ‘If war is God’s way of teaching the Americans geography, recession is His way of teaching everyone a little economics.’ But the current pandemic tells us that even after a decade plus of the recession that hit the west, we are yet to learn our lessons, not only from history but also from economics.
However, much before, Patel, Amartya Sen had categorically stated that ‘Poverty Eradication’ is no charity but absolutely essential for creating equitable conditions, where the poverty stricken is not compelled to re-distribute the disproportionate wealth owned by a handful through nefarious or violent means, as part of retributive justice. Nowhere, has this been brought home, close and upfront than in these COVID19 times and this commonsensical understanding will go a long way in devising appropriate policies for the times to come.
There are ‘Moral limits to the Markets’, as Michael J Sanders, explains, especially in times (quite apt for our present times, too) where everything is for sale- blood, education, health, position, even the womb and it is here that ‘inequality’ compounds the misery, adding to poverty. “In a society where everything is for sale, life is harder for those of modest means. The more money can buy, the more affluence (or lack of it) matters”, says Sanders. This ever widening gap between the have and have not’s, becomes more pertinent and fraught with grave consequences in a market economy where everything stands ‘commodified’.
Moreover, markets create a value or consumer mindsets that crowds out citizen values and further aggravates the problem for our socio-economic, civic-cultural lives, where our value sets or ‘sanskars’ get linked to incentives, and do not remain worthy enough to stand on the merit of being virtuous, alone. In short, markets drive out morals and changes the very character of the activity they put a price tag on; it chokes out all informal exchange and altruistic behavior. Michael goes on to say that it is for this reason alone that while ‘slavery was appalling because human beings were treated as commodities’ technology reducing human beings to data, doesn’t come close enough to be either appalling or let alone dangerous. What slavery was to America in the 18th century, surveillance is to all globally in the 21st century. In the era of a ‘rights regime’ we need to resurrect awareness about the ‘right values’, too.
Thomas Piketty has devoted not just a thousand pages talking about ‘inequality’ but his entire life studying it and he concludes that inequality has risen since the nineties, due not only to wage inequality but despite the stability in the wage-profit split, because it does not take into account the vast inequality of enhanced and large number of levies labour has to pay vis a vis the reductions in taxes for the companies and corporates who employ them. The answer according to him, “lies in the tax system and requires a re-balancing between labour and capital- for example, by subjecting business profits to family-benefit and national health contributions. This enormous job of construction will require strong international coordination.”
II THE INVISIBLE HAND
“Why has capitalism become so triumphant and democracy so enfeebled? Are these two connected?
“Capitalism has become more responsive to what we want as individual purchasers of goods, but democracy has grown less responsive to what we want together as citizens.
“The last several decades have involved a shift of power away from us in our capacities as citizens and towards us as consumers and investors.”
-Robert B Reich, Super capitalism: The Transformation of Business, Democracy, and Everyday Life
It is not just Adam Smith’s ‘invisible hand’ that allows an equilibrium between demand and supply and brings efficiency in free markets but more of the ‘invisible political hand’ of John Maynard Keynes and the inextricable interconnectedness of the two, conjoined at the hip of profit and self interest. Or what Robert Reich explains as the ability of the large corporations and top of the pyramid rich to influence the legislation that governs the markets, donations that fund the elections and sets the agenda for governance, what is commonly understood as the lobbyist and spoil system in the USA.
In the way the system, perceives, due to an inherent perspective bias, the default of a loan by a big corporation and a small farmer, where the legislation not only shields corporates through bankruptcy code but also makes it honourable to fail; gives a second chance, but a similar loan waiver for farmers, however meagre, raises eyebrows and certainly a dole is more charity than right.
Speaking about future of capitalism Joseph Schumpeter, believed that the very success of capitalism will eventually destroy it, as the more leisure it creates through better efficiencies for the handful of educated class, who will begin to question its moral framework and how its markets have driven away or crowded out virtues of liberty, equality, fair play and justice. However, much free markets are an essential requirement for democracies, markets are nowhere free from the invisible political hand.
Based on a similar Keynesian understanding of how the invisible political hand or what we understand as governmental interventions becomes a win win situation where what the political executive might see as popular and maximizing of votes, the populace may also find it equally desirable, and the twain of two self interests easily becomes common agenda for governance and the governed. However, as governments expand, the opaqueness created by complex layers of inter-connectedness, creates a chasm between governments and its peoples, thereby endangering and tilting the scales of the win win partnership. Voluntary disclosure of information as a part of the rights regime, together with massive public investment and targeted government intervention in favour of the invisibles can keep the partnership intact. But the complex web (both in breath and depth) of bureaucracies and legislations that have been created, creates conditions akin to Prisoner’s Dilemma, in decision making and our public choices.
The markets (including advertising markets, default mode in technology) take away our freedom to choose. Markets then get converted into minefields, especially with the surge in social media and invasive technology where the homo sapiens are the new raw material for colonization. In his very thought provoking book, ‘Freedom for Sale: How we made money and lost our liberty’, John Kampfner, has studied eight countries across the globe from Singapore, China, Russia, UAE, Italy, Britain, USA, including India and how states are increasingly using ‘Orwellian methods for monitoring the masses’ and how the ‘comfortable classes’, who used the country’s new wealth to move up the Abraham Maslow’s Needs Hierarchy Pyramid have ‘either turned a blind eye to society’s failing or knowingly played a part in them’, thus highlighting the complicity of the middle class who exchanged economic prosperity in return for unquestioned compliance.
In the ubiquitous social media market, to quote Christopher Wylie, the founder of and later whistle blower for Cambridge Analytica, “…with the advent of the internet, it became possible to create commodities out of our lives-our behavior, our attention, our identity. People were processed into data…[to] serve as the raw material of this new age data-industrial complex.” So while our lives are getting reduced to binaries of big data, we are headed on the conveyor belt to the slaughter house, like mince meat getting monetized for a la carte sumptuous feast, that will swell the numbers on someone’s balance sheet, pretty much unknown to us. Yes, that’s us, in the middle of nowhere, in this raging age of the meta data and social media, where the death of millions like us will be just statistics, not eligible enough to be tragedy.
We are the new ‘free lunches’ the economists say does not exist, but now made possible by technology, perhaps because it adequately warned us that when data becomes a public good, there will be all sorts of free riders. Technology has levelled us like a more hideous virus, where our constitutional rights of privacy are up for sale. But as consumers seeking constant validation and instant gratification, we are more than willing to voluntarily offer our selves at the altar of psychological manipulation. The Cambridge Analytica has already proved to be the new East India Company of the 21st century tech age.
Moreover, the pyramid is not comprised of the multitude of poor at the base and miniscule rich at the top, but also of the millions in the middle, the ‘comfortable class’, the ‘nouveau rich’ or the ‘muddled aspirational’ who behave most irrationally as per the behavioral economists and are easy, gullible prey in the predatory bazaar. They are also eulogized as the demographic dividend, the class that educated itself, got jobs, pays taxes, looks forward to a quality life and is also expected to sustain the non productive, non workforce populace of countries- the geriatrics and the minors. In the market economy, while the poor at the far end of the pyramid have no purchasing power, the ones in the middle do not have any bargaining power. If the poor is penniless, the middle is voiceless and both are weak, mere statistics in the numbers game. The system that is all powerful, needs to flatten the pyramid into a plateau.
But governments alone cannot be expected to re-frame the rules of the game and level them, the citizens have to reclaim their civic rights, by upholding their citizen values over consumer values. And the COVID19, is just giving us this pause time to introspect, as more things fall apart, the more the opportunity to re jig and alter our mindset from what Oscar Wilde’s lament, that, ‘nowadays people know the price of everything and the value of nothing’.
And, people as Richard Thaler will continue to remind us, will need a ‘Nudge’ for decisions that are difficult to take.
Or else as in Yeats, Second Coming, poetic justice will follow, when-
“The falcon cannot hear the falconer;
Things fall apart; the center cannot hold;
Mere anarchy is loosed upon the world
The best lack all conviction, while the worst
Are full of passionate intensity.”
III RISKING THE LONG, LESS TRAVELLED ROAD TO CITIZENHOOD
“Strange is our situation here on earth. Each of us comes for a short visit, not knowing why, yet sometimes, seeming to a divine purpose. From the standpoint of daily life, however, there is one thing we do know: that we are here for the sake of others.”
-Albert Einstein, from Leonard Mlodinow, Subliminal: The New unconscious and What it Teaches Us, 2012
We the people, surrounded and confounded by markets and social media technology have become a tragedy of the global commons. As Homo Economicus, of Rousseau, we were the ‘artificial people’ even before ‘artificial intelligence’ made its appearance. Nietzsche had spoken of corporates as ‘legal people’ pitted against ‘people with flesh and blood’. And COVID19, has also rightly validated Adam Smith’s understanding of ‘man as an anxious animal.’
The solutions also emerge from Adam Smith, the father of modern economics, where he suggests that, “the real wealth should be gauged by the standard of living of households. Bags of gold do not necessarily translate into bags of food. [nor] Tactics that placed money in the hands of sycophant merchants did not necessarily help the citizens of a nation.”
As the nodal officer in charge of facilitating domiciled natives of Rajasthan in Maharashtra, from the last five days, I have been working as a call center receiving incessant distress calls for basic assistance for ration-food, and medical aid. From the infinite calls I have received, I can safely conclude that while at a macro level there is no dearth of foodgrains, yet there are thousands who have called for either ration or cooked food, as their monies have run out, or some don’t know how to cook, almost similar to the lines of Samuel Coleridge’s, The Rime of the Ancient Mariner, “Water, water, everywhere, and all the boards did shrink; water, water, everywhere, not a drop to drink”.
‘Roti, kapda, makaan, dawa-daru’, will remain the four pillars, holding up the foundation of the pyramid. And the only way to look at it is through the monthly items of expenditure in the household budgets of the lower and middle class, which makes up the bulk of the pyramid, and follow a two pronged strategy- a) enhance the household revenue by increasing the purchasing power through outcome based cash, directly transferred into their accounts by employers- both governments and private sector b) by reducing the various kinds of items of expenditure in the household budget pertaining to rentals, fees, user charges, hidden charges and making more saving available for the basics. The right to the pre COVID19, quality and dignity of life will be absolutely essential, even as we struggle to get the livelihood and economy back on the track. In the long term however, Nassim Taleb’s solution to make the, ‘’society more equal is by forcing (through skin in the game) the rich to be subjected to the risk of exiting from the 1 percent.”
Moreover, our propensity to risk taking is also a differentiator, pretty much like the have and have not’s “as citizens, lab experiments, artisans, political activists and hedge fund traders all have skin in the game, but policy wonks, corporate executives, theoreticians, bankers and most journalists don’t”, and again Taleb is spot on.
While doing Public Policy at Berkeley, I had some close encounters with the homeless. On one occasion, and with great hesitation, after seeing a homeless man, who looked like an army veteran, old and haggard, pick up food from a dustbin, and as I gathered courage to offer the only apple I was carrying for lunch to class, while he sheepishly looked askance, it was the same feeling then as now, while I attend the innumerable calls for food. It was painful then, as it is now, to see scores of people thus, just out on the streets, with barely even a dollar, begging for just food, for bare survival. The dignity of life gets lost in the quest to simply just survive, exist. I still recall, as we waited, at the bus stop at one of the Bart Stations from where I took my bus back to Oakland where I stayed, an old gentleman reached out to me, and said, ‘happens’, just as I tried to hide my tears, for strange people who were bringing them on. I feel uncomfortable in my skin, when so many people have risked theirs’ for nothing in return.
People may appear to be strange, but they are not, they only reflect back out own deeper insecurities and inability of not being able to trust, or to not discriminate, or value judge. In fact, all our interactions with the world are just for us to soften, smoothen any angularities we may have developed with our sense of pride in our achievements, positions, power or means, they come to naught if they don’t shape us in good ways. The corona, is just trying to do that, level us all, flattening our bloated egos, our sense of self worth, everything. It is not just a strange virus but also an eye opener, cracking us open, in more ways than one, it is our much deserved karma.
And as Rumi says, “The light can only enter through the crack.” So, let this be a time when we allow these times to crack us open, allow the light to overwhelm us with a behavioral nudge, let our hearts, our empathy, our compassion have no others, and let it guide us as we tune in and turn up to set the agenda for the dawn after the dark, for we will be there, soon.
While we will survive this, with some collateral damage, let us ensure we learn our lessons well and apply them, before amnesia and callousness strikes us again, for we owe it to humanity to restore our pride in ourselves, before we stoop (yes not stop) to lecture others.
There are no others, in this war, the only enemy is the virus. Sometimes, the enemy is closed mindsets, absence of common sense, lack of vision, proper communication and compassion. In short, many a times the virus is, also us!
Author, is a civil servant by profession and an empath, writer-poet, artist and avid reader by choice.
Note: author is reachable at email@example.com