Intellectual poverty of Sudras and Dalits

Caste has been a publicly derided and privately practiced system among all streams of Indian elite. The anglophile Left-Secular stream mostly from savarna castes seemingly opposes caste vehemently, but just a scratch on their agenda would show the ugly under belly of using caste as a tool to secure their own privileged position against all possible competition. The Right-Hindutva stream, which is also led by mostly Savarnas, apparently aspires to upstage Left-Secular establishment using Hindu identity subsuming the caste identity of Hindus, particularly lower castes.

Both establishment ideological streams are uncomfortable when it actually comes to accommodating people from Sudra-Dalit castes into their inner circles and there is widespread opinion among many political watchers that these seemingly mutually exclusive groups actually cooperate at some level to monopolize the discourse in the country. So, one can see arguments in TV studios between good friends between Left and Right.

The Left-Secular establishment owned TV studios, Think Tanks invite the same set of people from Right-Hindutva group, as if they signed long term contracts with them, and, out of gratitude or as per the terms of the contract the Hindutva side makes a show of opposition, In fact after Modi rise they actually started silent cheering in Left-Secular TV studios when it comes to criticism on Modi.

People who can put forward some coherent points on caste issues, coming from oppressed castes, with their natural inclination to Left-Secular ideas find it difficult to be recognized or find a place in the exclusive elite Left-Secular club of upper castes. The educated thinkers from lower caste find Hindutva-Right agenda as an attempt to drag them back to the oppressive varna system and they naturally have no inclination to join them, moreover, with emphasis on pristine savarna revivalism the Hindutva group drives serious thinkers away.

The Left-Secular upper caste establishment dominates the intellectual establishment in the country. Before the rise of Modi they also managed to dominate the politics through Congress-Left parties for a century, particularly after independence. The Hindutva-Right group after being submissive as a managed opposition for decades to Congress hurriedly emerged as an opposition with the help from same Congress when other serious groups threatened their cozy arrangement beginning from 80s. The collaboration between congress and RSS on Ramajanmabhoomi movement is no more a secret.

The cozy setup between Congress and Hindutva continued under Vajpayee, perhaps as a gratitude for letting him remain as a big opposition leader for decades. By an accident of destiny, a leader emerged outside the cozy arrangement and he has the genius to consolidate his position after every step in his political progression. This has so upset the Congress-RSS arrangement; they tried everything to finish Narendra Modi at every step after his deadly intentions of a leader in his own right with independent thinking were revealed to Congress-RSS cozy club.

Narendra Modi emerged as a leader in his own right and talent to become PM of India, he also happened to be from a very ordinary background. The Congress-RSS club is upset with this sudden political transformation in the country and trying hard to somehow neutralize this threat to their hegemony. The RSS taking the lead now within Congress-RSS system is carefully weaving a net around Modi, so that he won’t be able to control the leadership evolution inside Bjp, and be in a position to takeover party in a potential post- Modi scenario.

The Congress party was hijacked by Nehru family after Gandhi-Patel duo built it as a mass organization, similarly after decades of little success for the Hindutva parivar Narendra Modi managed to bring the RSS parivar to power with full majority with his strong appeal to Dalits and Sudras and general poor. Now the Sangh Parivar has a chance to hijack the mandate to Narendra Modi if somehow it can neutralize him. Members of the Congress-RSS cozy club are already expressing their sympathies to Congress on social media; they don’t want its total collapse as they fear the political vacuum would be occupied by Dalits or Sudras.

The Sudras with their strong regional appeal tried to consolidate and capture some political power in Delhi through alliances in the past, but each time members of RSS-Congress cozy club as part of coalition sabotaged. The complete Congress collapse would free the opposition space with a possible emergence of a Dalit-Sudra led political coalition. This is a threat to the Congress-RSS monopoly in Delhi mostly led by savarna castes.

After Bjp victory in 2014 there is fresh enthusiasm within joint Congress-RSS supporting groups, after a period of thirty years one of their favorite political party got full majority and they are in full steam to reverse the political gains made by Sudras in North India after Mandal era and split Sudras in South India. Just like Sardar Patel helped to consolidate Congress among Sudras, they achieved the same through Narendra Modi and now making schemes, with their people at right places, to hijack Bjp at the top in a post-Modi era or after potential sabotage at any available opportunity.

The varna system existed in the country for millennia has intellectually impoverished Dalits-Sudras in the country. They are not in a position to intellectually assert though they have made some gains in politics at the regional level. Political hegemony can be fought through and cannot be maintained for long, but political hegemony supported by Intellectual hegemony is a deadly combination and this has been the story of Indian politics so far. The regional political gains of Sudras will be repeatedly neutralized if they fail to takeover the affairs of the country both politically and intellectually in Delhi, but it’s a daunting task given their intellectual poverty from millenia.

For thousands of years the keys to the civilization and system in India were owned by few Savarna groups and passed as hereditary property, since they had the exclusive monopoly on knowledge sources, which is the real power of a civilization, the whole system including political power followed the framework monopolized by few groups.

When British came they managed to shake the knowledge foundations of Indian civilization, the savarna groups progressively abandoned their traditional sources in favor of European ideas and knowledge. They adapted to English and European ideas but continued their intellectual domination on Indian masses through varna lenses with the borrowed European tools.

The crisis for Sudras and Dalits in the country is more related to intellectual impoverishment of millennia; they are so dumbed down and intellectually intimidated that even some educated Sudras think very low about themselves and their potential. If the Sudras can’t see the emerging socio-political game in Delhi, they could potentially lose another century of access to the real power in the country.

Political power in Delhi can help Sudras-Dalits to also rise at the intellectual level which in turn will sustain the political gains. If Sudras-Dalits raise their intellectual abilities and realize their potential it would lead to a new Indian renaissance with emphasis on equal opportunity and can push India to the top league.

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Neo Globalization – a nexus between west and China

In the art of communication, terminology is most important and has a big impact. A partisan idea or process can for a while be presented as the most benevolent and liberating with the choice of appealing and attractive terminology. “Globalisation” is a word with tremendous attraction and appeal as its meaning is impressive and sensible, with a promise of hope to expand towards new opportunities and adventures.

 

If globalisation is movement of ideas, goods and people across the planet, it’s as old as human existence. Then, why since the last century, particularly the last quarter of the twentieth century, is the idea being marketed as a new discovery or path that could transform world economy and liberate civilisation? What special magical attributes the “neo-globalisation” acquired compared to the original ancient idea that it has emerged with unquestionable cult status among the elite establishment in almost every nation?

 

“Globalisation” and words and phrases used as substitutes in the neo-globalisation propaganda like “free trade”, “free market”, “liberalisation” all sound very benign and rational. This charmed terminological jugglery has worked beyond imagination for decades, but nice words cannot forever promote or shield partisan ideas that lack integrity of purpose. Neo-globalisation is different and has been promoted to mean original “globalisation” through sustained propaganda, when in practice it actually means re-colonisation of former colonies.

 

Neo-globalisation is not about free movement of ideas, goods or people. It is about globalisation of few select western currencies, led by the US dollar. This monetary globalisation is a more potent method involving less effort and risk than the conventional brute approach practiced till the first half of the twentieth century. The combination of intellectual propaganda and tactics supported with projected military strength is the modus operandi of this neo-globalisation.

 

Who are the real beneficiaries of this process?  A small group of establishment elites in politics, business, bureaucracy, judiciary, media, academia across nations, who are willing to shed the sentiments of nation, community interest, justice and conscience for access to global privileges and benefits. Not all enjoy the same power and recognition in the club, but there are many collaborators in erstwhile colonies. Mostly descendants of establishment propped up by old colonial masters, they are more than willing to cheer and slave for the neo-colonial masters.

 

The monetary colonisation promoted by the neo-colonisation agenda means transfer of real resources from nations to those who control global trade through a rigged global financial system, supported by a security and military architecture. Exchange of commodities through trade between nations is an ancient idea and process. No nation in history or in the present has remained isolated, even with most self-sustaining economies. In fact, historically there was little restriction on movement of people and not just trade, unlike the present where rich countries like unrestricted transfer of resources from poor countries, but not people.

 

Modern economy and the life style it promotes is very resource intensive. The modern economic and business theories don’t integrate this aspect; it is left to the governing class to find resources for continuous economic growth needed to maintain high employment levels following these theories. The corporate thirst for profit inherently needs beyond basic economic growth (needed with population growth) to sustain employment. The surplus profits have to be somehow reinvested for filling the employment deficit in the economy, created by the profit thirst, which means the modern economy has to continuously add new goods and services to sustain employment levels.

 

The necessity of continuous economic growth to serve corporate profit thirst puts tremendous pressure on the state and governing class to plan for and gather the resources needed for continuous growth. They need colonies to supply resources cheap; neo-globalisation is a process of achieving it through subtle monetary colonisation of poor and under developed countries, mostly former colonies in Asia, Africa and South America.

 

Monetary colonisation doesn’t need military occupation or physical takeover of colonies. The modern security requirements and aspirations of poor nations, particularly those squeezed during the colonial era, need some level of industrial infrastructure and modern economy. The single most important commodity that drives the modern economy is crude oil. Under Washington’s leadership, the West has managed to get control over the exchange and distribution of oil, exploiting the political and geographical insecurities and needs of the oil-rich Middle East.

 

It is incorrect to say that the US dollar and other western currencies are fiat and not backed by anything; they are backed by the most important commodity of modern era with support from modern military and technological might. These currencies are stronger than the gold standard. But, the power of petro-dollar is directly proportional to the use of crude oil, which means the resource intensive economic model depending on crude oil has to be promoted everywhere.

 

The combination of petro-dollar and general domination of international trade exchanges through well-established banking networks gives immense monetary advantage to the US and allied western powers. However, the power is proportional to the usage of crude oil and increased international trade. If the world at large outside the industrialised west, Asia in particular, remains indifferent to the resource intensive economic model of the west, the advantage with petro-dollar would be very less with little access to natural resources from former colonies in Asia. Africa, South America.

 

The petro-dollar helped Middle Eastern oil-rich countries as they import almost everything they need. Hence, petro-dollar is a mutually beneficial arrangement between western industrialised countries and the oil-rich Middle East. This alliance needed a major country in Asia to globalise petro-dollar and they ironically managed to rope in communist China, a vast country with close to one-sixth of the global population.

 

China, the ancient Asian giant, was a prosperous self-sustaining kingdom with its own sphere of influence, until the Europeans came and practically made it a colony. It was a noble and rich eastern civilisation that self-sustained for centuries on the principles of Confucian harmony, similar to other ideas of harmony and co-existence in eastern cultures. The country suffered indignities and poverty in the colonial era between the ambitions of western powers, Japan and Russia. Finally, the communist party under Mao Zedong, with tactical help from the Soviet Union and the United States on different occasions, managed to takeover the country in 1949 through a revolution.

 

Imperial China was very reluctant to accept European ideas, commerce and innovations, considering them inferior to its own ways and culture. After defeat in a few wars, the reality of its own security weakness vis-à-vis the European military technology made the country open up to European trade; it practically became a European colony.

 

Mao Zedong tapped into these sentiments of oppression and united China under a strong central government after long time. Mao realised the necessity of modern technology for China’s security. He threw China into a flux to come out of inertia, old habits and to consolidate his political hold. Even as a fledgling communist nation just out of colonial shadows, suffering from poverty and many internal problems, China under Mao zealously guarded its territorial integrity against the machinations of the super powers in its backyard during the Cold War era.

 

In 1972, US President Nixon visited China at a time when petro-dollar negotiations were going on with Middle-East. A new relationship emerged between the capitalist west and communist China. Mao’s strategy was collaboration with the far enemy in the west to counter the near enemy, the Soviet Union, to enable China’s rise to its potential.

 

The Nixon’s visit heralded US-China strategic engagement and in a decade it blossomed into a full blown partnership. China opened up its resources to western corporations in a very controlled manner, promoting joint ventures between its state owned companies and western corporations for technology.

 

The western powers got natural resources in the form of finished products at much cheaper prices through depreciated currency while China gained technology. China combined foreign investments in technology with much bigger domestic investment through state owned enterprises and state owned banking system, which kept real interest rates at near zero, to achieve unprecedented economic growth in modern history, in just three decades. In this period, China achieved more than ten percent average GDP growth.

 

With Chinese collaboration, the petro-dollar became the most potent and dominant medium of exchange in International trade. The export-oriented Chinese economic model provided resources at less than half the natural price through depreciated Chinese currency for western consumption. Neo-globalisation propaganda smartly uses “cheap labor” as a euphemism for this resource drain. There is no cheap labor; it actually means giving natural resources cheap through depreciated currency.

 

Currency depreciation by a country means willingness to sell more resources at less exchange value in return. A country with x billion dollar exports with a depreciated currency at one-third of its natural exchange value against dollar, actually exports 3x billion dollars’ worth goods and services. But when it imports from western economies, it has to pay the regular or high price.

 

The impetus given to petro-dollar by China forced other countries to open their resources for western consumption. With a large economy like China depreciating its currency for exports, the lesser and dependent trading partners of China had to further depreciate their currencies against dollar to remain as competitive suppliers of resources to the Chinese export economy. The net result was a massive one-way transfer of resources from former colonies in Asia, Africa, and South America to western powers. History is repeating itself in a sophisticated and stealthy way. China has become a conduit for massive transfer of resources to the west through its export economy.

 

Neo-globalisation has created some imbalance in western economy and society as western corporations outsource employment for cheap resources and more profits. This is an inevitable consequence of extreme profit-chasing, which needs resource intensive continuous economic growth, leading to a very consumerist society. The combination of profit-chasing and a stable economy with full employment without growth in new goods and services is impossible.

 

The income lost with stagnated wages and unemployment in western economies caused by outsourcing is being filled with consumer credit and government deficits funded by the surplus foreign exchange reserves accumulated by China, Middle East and other countries, invested in western financial system and sovereign debt. It’s just a process of recycling and since foreign debt is also denominated in own currencies, it’s not a serious matter for western powers when push comes to shove. Just like how trillions were pumped into the system from nothing after the 2008 financial crisis, similarly foreign debt can be recycled or paid. The sovereign creditors won’t push too far as it would undermine the real value of their own surplus exchange reserves.

 

The promises being made in the 2016 US election campaign by contenders on both sides, on stopping outsourcing and forcing offshore manufacturing back to the United States, cannot be realised without fundamental changes to the economic system and lifestyles.

 

A self-sustaining stable economy with high employment needs a balanced lifestyle with skills to utilise and be content with local resources that can be recycled. The current standard of living in western nations is not possible with a self-sustaining national economy, but if at all it is achieved by structural changes and reducing consumption levels, it would be more fulfilling with greater socio-economic stability and also provide for reasonable consumption.

 

China has greatly benefitted the west since it opened its economy. It has overdone its export model and accumulated a mountain of foreign exchange reserves, currently more than $3.5 trillion. It has achieved this at immense cost to its resources and environment; it has opened its economy for joint ventures with western companies but unlike India and other countries, until recently it didn’t allow any foreign investment in its financial system or stock markets. It gave limited access to foreign investment in its stock markets in 2014, as a necessary pre-condition for reserve currency status from IMF to Renminbi, which it achieved in 2015.

 

On purchase power parity basis, China is the largest economy and its share in global trade is highest, surpassing the US. The Chinese economy is a controlled export-oriented economy; its internal consumption levels are low compared to its GDP. To move away from exports and rebalance, after the 2008 crisis China engineered a real estate and stock market bubble through its state banking system to move the economy to internal consumption and maintain growth. Many mistake this as a big structural flaw in the Chinese economy and they have been predicting doom since then, which hasn’t happened so far.

 

But while reorienting its economy to internal consumption, there is one real problem China has to face like any other modern economy. Growth through internal consumption means either most resources have to be available locally or the country has to promote its own neo-globalisation model, which means China has to look for globalizing its own currency.

 

Getting reserve status from IMF is the first step. But for a country with four times the population of the US, aspiring for the same standard of living means its currency should be much more powerful and acceptable than the petro-dollar. The trading partners should accept Renminbi as a substitute to dollar for China to divert its finished products or import finished goods for internal consumption without bothering about trade deficits.

 

This is a very tough task for China; though it has the highest share in global trade, it is still mostly denominated in dollars. Western soft power is immense; they have over centuries of colonisation, via selective immigration policies, co-opted the elites in former colonies across the world. The English language and network of tax havens makes elites in former colonies more comfortable with western currencies to secure and hide their surplus profits, than with Mandarin or Renminbi. The world economy still runs on oil denominated in dollars.

 

It is almost impossible for China to rise following the same resource intensive neo-globalisation approach of the west. It would end up paying tribute to the west as it did for the last four decades. Having secured its economic position and achieved a level of military deterrence, China should go for new technologies based on sustainable energy sources. It has already immensely contributed to mainstream solar energy.

 

Though it is aggressively pursuing acquisition of natural resources, including engagement with resource rich Russia, and improving its financial footprint through infrastructure bank AIIB and projects like the ambitious Eurasian corridor through Central Asia, ultimately it has to achieve a higher degree of less resource-intensive economic sustainability inside its borders in order not to repeat the same modus operandi of neo-globalisation on other hapless nations. It has to revive its Confucian thought and principles of harmony which sustained its rich civilisation organically for millennia within its borders

 

The Trans Pacific Partnership is designed to isolate China in the Asia-Pacific and Trans Atlantic Trade and Investment Partnership is to contain Russia-China Eurasian ambitions through Central Asia. There is pressure within western nations against these neo-globalisation agreements that are depriving local employment, but ultimately the issue boils down to economic ideas and lifestyles of people. It’s futile to blame policy-makers when businesses promote and people aspire for high consumerist life styles.

 

It would be interesting to see whether China could manage to come out of the shadows of Western powers and create its own sphere of influence at least in Asia, in collaboration with Russia, which has resources and a dwindling population. China can rise peacefully and sustain itself, but not by following same extractive resource-intensive strategies of neo-globalisation on other countries.

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Alternative banking and sustainable economy – 2

The modern banking system evolved from private lending in Europe during medieval times and gradually took over the role of creating money in the economic system. The modern banking system creates money; it doesn’t lend saving deposits to borrowers as commonly perceived. The banking system creates new deposits, which is money, from thin air with new loans (click for Bank of England publication). This is the only way money is created in the modern economic system. The banking system creates money, not the government treasury.

 

When banks give loan they create a deposit to borrower from nothing and when the borrower repays the loan the deposit cease to exist. The money brought into existence by banks in the economy as loans exists in circulation as long as it is not paid off. If the only way banks create money is through loans and if they are paid off, then there should be no net increase in the quantity of money in the economic system. There is indeed no net money in the system; money in the system is created as debit and credit at the moment of lending by banks and when the loans are paid off both credit and debit disappear.

 

Questions arise about the common perception of increase in money supply with economic growth and why there is inflation. This perception is caused by one big loan that can never be paid off; the debt accrued by government through loans from the system to fill the fiscal deficit. Since government can never pay the entire debt with interest and it continuously grows, money supply in the system outside government increases over time.

 

The economy with modern banking can never grow without government debt. This can be illustrated by a model of an ideal government that doesn’t borrow and a banking system that gives out loans with interest. The loan creates economic activity; the borrower has to spend it for his input cost, which includes government taxes, to create output. The output has to be sold at a price greater than his input cost to repay principal with interest. At ten percent interest rate with a loan term of five years, about 75% of all bank loans should default for the remaining 25% loans to successfully repay principal with interest.

 

Even the 25% loans can only succeed if the banking system doesn’t insist on recovery from defaulters, if banks recover loans from defaulters, money created through loans is destroyed when recovered and the remaining 25% borrowers would also default. So, modern banking system with efficient recovery process and an ideal government that doesn’t borrow will fail any attempt for economic growth. The primary impact of such banking system and government would be transfer of ownership of assets from borrowers to depositors through extractive lending and not economic growth.

 

Above 75% probability of failure is too big for any adventure towards economic growth and certainly the current trajectory of economic growth doesn’t indicate the existence of such ideal government and efficient banking system that recovers all loans. In the modern economy government through limited liability protection to corporations and through its investments in economy via debt in a much skewed way greatly enhance the overall probability of businesses to succeed.

 

In the current system, government through public utilities and infrastructure can never recover all the dues for the services through taxes on businesses, and also achieve economic growth. The government has to subsidize the services for the economy through its own debt which grows at a faster rate than real GDP growth because it also has to pay interest.

 

The expenditure of government, through borrowed money, in creating public assets and services but without recovering all the expenses, rescues the entrepreneurship of entrepreneurs. Even the cost of limited liability of a corporation is ultimately transferred to the government, since banking system factors such losses in interest charged on loans. The reason for massive government debts in every country is not populist and reckless spending as fiscal and market fundamentalists propagate; if economic growth is desired then government debt is inevitable with the present money system through banks.

 

All debt created by banking system is either recovered through asset transfer from the defaulter or transferred to government. Default loans don’t create sustainable economic activity, when banks recover them the money they inject in the system gets destroyed with transfer of asset ownership. Economic activity leading to successful repayment of debt to banking system would indirectly transfer debt to the government, this results in the illusion of increase in debt free money supply in the outer economy while government bears equal amount of debt.

 

If government has to repay its debt, it needs all the “free” money owned by public in the economy; this means combined net income and savings of all economic participants, excluding the loans they owe to the banking system. If economic growth halts banking system cannot create money through loans, without economic growth and increase in money supply government cannot borrow forever from the system to repay debt, and the whole debt monetary system collapses.

 

All debt has interest and since the government is ultimate borrower for the economy to sustain economic growth, it ultimately ends up paying interest on all existing money supply in the system. The government has to pay interest and part of principal periodically to maintain trust in this Ponzi scheme; it does so by borrowing more from the system.

 

What exactly causes money to lose purchasing power over time is the next big question. Though government inefficiency because of corruption and indiscriminate consumer loans from banking system also cause inflation, the main reason is interest on the money charged by banking system throughout its existence.

 

All money bears interest throughout its existence even if the possessors don’t pay it directly. There is no debt free money in the modern economy. While principal part generates economic activity to give value to money, interest, excluding the part needed to maintain bank employees and bank infrastructure, is just continuous exponential expansion of money supply, with no productive activity to generate value.

 

The bank interest paid on deposits is an unproductive overhead in the system that doesn’t contribute economic value but causes inflation. The principal part of money contributes to real economic activity and transforms into wages or income of producers. Since, price of a product includes both principal and interest, income earned through productive activity, which is just principal part of the loan, can’t buy the output. Producers can’t afford their own economic output as the prices are more than their income, which is the seed for inflation.

 

Inflation is integral to interest based monetary system, producers have to frequently raise prices to chase their own economic output as consumers. No participant in the economic system, particularly poor and middle income groups, can have the instant flexibility to adjust the price of their output upward, to match the continuous exponential growth in money supply disproportionate to real economic growth. So, in the context of responsible productive bank lending, inflation would lag the interest rate resulting in net real income gain to depositors.

 

When banking system causes inflation to shoot up beyond interest rate with indiscriminate consumer and speculative lending, leading to asset bubbles, interest rates are raised by convention, and maintained ahead of inflation, to provide net real income gain on deposits. The banking system punishes productive activity even for its mistakes and mismanagement, the real value of bank deposits would continuously grow, money may not grow on trees but it certainly grows in bank deposits continuously.

 

Now the question arises who owns bank deposits. If bank deposits match savings in the economy, since savings are proportional to income, low income groups should have least or no savings, because they barely survive and majority of them can’t even access banks. It is not an exaggeration or unreasonable to conclude that almost all deposits in banking system are owned by middle and above income groups.

 

The middle class by definition earns middle per capita income and savings from this class are also average. The surplus savings from upper middle class and rich are either reinvested or deposited in banking system; this class automatically makes more money through interest. The middle class savings are protected from inflation but incomes are not, in the long term interest driven inflation is also net loss to this class.

 

The net income share of rich and upper middle class in economy continuously expands through interest rate, without any exertion from their part, at the cost of poor and middle class. The poor bear the maximum brunt of this free continuous transfer of resources to rich. The gains from interest are periodically converted to property gains, over time the system would massively drain real assets, income from poor and middle class to a small group of rich.

 

Interest integrated into monetary system continuously increments the income of rich and facilitates the unlimited profiteering model and cartelization. The inherent inflation created by interest in the system clouds the economy with uncertainty and price volatility. This uncertainty and insecurity is reflected in all aspects of socio-economic life.

 

Interest gives massive advantage to early entrants in the economic game as it continuously increases establishment costs with time. New entrants would face massive cost disadvantage to compete with well-established entities at the same output prices, this helps few early entrants to monopolize the economic activity and dictate the prices for unlimited profit. The general inflationary environment and price instability caused by interest gives cover and justification to upward price changes of cartels for unlimited profit. The unlimited profit path snatches all real assets and pauperizes masses, and pushes them into never ending debt slavery when nothing is left with them.

 

Institutionalized interest and debt money is also heavily destructive to environment. The debt money system can’t sustain without continuous economic growth to repay debt with interest. The government would default on its debt commitments without economic growth. So, it has to promote economic activity, irrespective of need, at huge cost to environment. Construction, destruction and reconstruction are permanent features of economic agenda of government, to somehow maintain growth, re-pay debt with interest that can never be totally repaid.

 

The idea of interest has a legitimate role in society and civilisation when it is between private individuals and within the limits of natural justice. There would always be demand for extra money and it’s not improper if that demand is met and gains made through legitimate and fair means taking risk of potential loss. Institutionalized risk-free interest-bearing debt money means the whole socio-economic system is in permanent un-payable debt and is forced to slog as an indebted slave to repay it.

 

Roadmap for a debt free economy    

 

Sustainable growth can only be a mirage in an extractive monetary system promoted by modern banking. Civilisation needs debt free money to enjoy the prosperity of its hard work. Money which is just a measure of creative activity becomes its overlord when it becomes debt. Economic growth is increase in the quantity and variety of goods and services. It can be classified broadly as (1) basic economic growth (2) vertical economic growth (3) horizontal economic growth.

 

Basic economic growth: With increase in population basic economic growth corresponding to population growth has to be achieved to meet the demand for goods and services. If no resource constraints on economy the limit of basic economic growth rate is equal to population growth rate. Basic economic growth increases GDP but doesn’t increase per capita income since there is no rise in per-capita consumption. Debt money for basic economic growth is analogous to an animal devouring its offspring.

 

Vertical economic growth: When a new product or service comes into existence, it adds to the basket of goods and services in the economy. To afford these new products and services the income in the economy has to grow. At a given standard of living the workforce and income in economy remains in equilibrium. A new product or service introduces new area of activity and this has to draw workforce from existing pool, as workforce availability in existing sectors decrease extra effort is needed to maintain the same economic output in those sectors. So, when the net economic output increases the workforce is making extra effort to achieve it; this has to translate to extra income. A new luxury product can be limited to a very small market of high-income earners, but products produced in mass scale become part of horizontal growth in economy

 

Horizontal economic growth: To make a product part of horizontal economic growth it should be sustainable from the perspective of environment. As horizontal growth would engage a significant workforce, it adds to economic growth and greatly increases per capita effort. Money supply has to match this per capita effort increase to raise per capita income and make the product affordable to the economy.

 

Debt and interest free money for economic growth

 

Money has to be created and issued as a measure and share of ownership for participants in economic growth. If there is economic growth then there is need to issue fresh money to measure and give ownership on it. This is the duty of institutions (government) following sound principles, and cannot be delegated to private profit making institutions. The government can use banking system to issue interest free money and create debt-free economy following some simple logical rules. A simple alternative banking model can illustrate how an agricultural economy can evolve into an industrial economy with debt-free money.

 

Modern development requires movement of work force from agro-economy into modern manufacturing and services. This means creating assets in manufacturing and service sector. The banking system can finance this transformation with interest-free money. The government has to play a significant role in creating basic infrastructure and services to facilitate economic growth and private enterprise

 

Entrepreneurs can receive interest free loans with full liability up to a percentage limit on investment. The loan issued should go into establishment cost of planned enterprise and wages. The cost of enterprise also includes banking cost and the bank would collect a fee upfront for the loan issued. The banking system would create a matching deposit of equal amount to the loan in the government account. The entrepreneur gets the loan and the government gets equal amount as deposit.

 

The government would decide a reasonable profit margin on the total loan amount issued by banking system, to provide for income or profit of entrepreneurs, the banking system would also create this money and add it to the government account. Successful entrepreneurs would get tax concessions from the government equivalent to the loan plus profit margin, distributed over the loan term to facilitate repayment. The distribution of tax concessions to the enterprise, over the period of entire loan, would ensure repayment through serious economic activity.

 

The freedom of individual entrepreneur to make profit is not restricted, but the intention is to limit profit potential in the system beyond a limit through money supply. The entrepreneur still can use his skill to maximize profit. The government through banking system, in a transparent manner, should promote diversity, fresh talent and small enterprises wherever feasible.

 

The deposit in the government account compensates the loss to government revenue for tax breaks provided to entrepreneurs. Same process has to be followed for loans to government enterprises. The government has to set targets to banking system, to issue qualified loans sector-wise, in accordance with growth potential and need in each sector of economy. No consumer loans should be allowed from the banking system

 

This process would not create any debt in the overall economy. A diligent and productive entrepreneur would be able to repay the loan over the loan period by serving the demand for his output, created by public expenditure. At the end of the term he would own the enterprise and make reasonable profit which is also his income. If he fails, he would be liable for the loan.

 

Since industrialization and modern services are part of vertical growth from agro-economy, there will be continuous burden on agriculture to improve productivity to support growth in economy. If agriculture fails to deliver on productivity no sector in economy can sustain growth. The per-capita productivity gains in agriculture needed to sustain economic growth also have to be rewarded. If farmers are allowed to fix reasonable output price, they automatically gain their share of income. The extra efforts to meet the demand have to gain extra income to afford economic growth.

 

Industrialization creates immense pressure on agriculture sector to deliver with continuous dwindling of work-force; if work-force falls too short, mechanization becomes inevitable. If income in any major sector has less GDP share compared to the workforce engaged, the sector can gain by gradual increase of its output price until per-capita income moves closer to GDP per-capita. This income rise has to happen in sequence, one sector after another, in sync with horizontal economic growth, to achieve a decent standard of living without losing balance in economy. As per-capita income across sectors closely matches GDP per capita, the workforce will have a general level playing field in the choice of profession.

 

The income balance between sectors through price rise is an effective idea to promote balance in economy and provide full employment. If automation limits employment in Industry and services, unemployment can be solved by moving people back to agriculture and raising its income share proportional to workforce.

 

References:

  1. Money creation in modern economy

http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2014/qb14q1prereleasemoneycreation.pdf

2. A lost century in economics: Three theories of banking and the conclusive evidence

http://www.sciencedirect.com/science/article/pii/S1057521915001477

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Alterative banking and sustainable economy – 1

Modern civilization is entering an interesting and critical phase. It is only a matter of time before the nakedness of the order is exposed just as in the tale wherein a little boy exposed a deluded emperor roaming naked in the street. The little boy could expose the emperor because he saw things as they were without superimposed fear or self-doubt born out of conditioned thinking.

 

The little boy approach is needed to understand the present convoluted order and see things as they are. The discourse on economy has become pervasive in the modern society. People are constantly worried about their careers, livelihoods and always looking for more economic security. With all the bombardment of economic jargon, most are not sure about the economy puzzle, cannot fathom where it begins and where it ends, and yet it influences so much of their lives, values and character.

 

There was a time when religious principles, values, culture, skills and statecraft influenced the economy. In the modern context, religion, culture, skills and statecraft have become subsidiaries of economic ideas and organization and the economy has emerged as a dominant factor in human history. The religious prophets have made way for economic prophets and religious battles have transformed into wars for economic dominance.

 

Society is engaged in economic activity than ever before because a continuous war for economic survival is forced on it. Hence all vocations and aspirations of the human soul are suspended and the focus is on survival. The “haves” are also insecure, because this is an endless unstable economic war with no time and convenience for the “haves” to cherish peace and enjoy prosperity in this melee.

 

The war is visible but the roots are hidden under a maze of ideological cobwebs with unassailable authority and sanctity in the academic world. The sincere but conditioned expert sees the economic war but doesn’t dare to look at the roots. The layman is caught in it, feels something is fundamentally wrong, but sees neither beginning nor end. All things start with some core ideas before they assume complex forms, yet the underlying core remains the life force for the complex form. Three ideas are the life force for the modern economic setup (1) Unlimited profit (2) Private banking with institutionalized interest and (3) Limited liability corporation. These three ideas and the institutions they create support each other and form an impregnable layer of hegemonic control over modern economy.

 

Profit and the idea of Money

 

Profit was the income of a merchant and self employed artisan in the mercantile era, a reward for his risk and hard work. The merchant could earn his profit and spend it for his sustenance and perhaps for his opulence and luxury. He could build manors or sponsor art, the income he earned flowed back into the economy, further stimulating it. This concept of benign profit was turned on its head with the religious ideas of hard working, frugal spending and reinvesting profits as part of “worldly asceticism” to prove oneself an “elect”, a person predestined to achieve salvation; this Protestant idea made worldly success a sign of a person predestined by God for salvation. Wealth was desired as a proof of exalted spiritual status.

 

Religious doctrines turned benign profit into an extractive idea of monopoly. This disturbed the crucial equilibrium between income and expenditure – expenditure at one source is income at another. Profit became a means of expansion and conquest to make more profit, and heralded the era of Capitalism.

 

Soon local economies couldn’t sustain the increasing appetite for profit; overseas trade accelerated and the colonisation of Asia and Africa began, financed by the gold and silver from the continents of the New World. These overseas adventures needed huge capital with limited risk, thus the first joint stock company and Limited Liability Corporation Dutch East India Company emerged. Colonisation is a manifestation of that inherent drive and competition for glory through profit.

 

The benign aspiration for profit transformed into greed for unlimited profit in Europe spread to all civilisations. The appetite for unscrupulous profit is strongly enhanced by limited liability of a corporation. Through the framework of corporation, a band of profiteers can avail national resources through the banking system which creates money, and play the game with limited risk, and if smart enough with no risk of loss in the event of failure in the gamble. This gives opportunity without risk to influential, informed and connected persons at the expense of diversity in the economy and ownership of resources.

 

Through on-demand access to capital via the banking system, a small cabal of profiteers can eventually take over the commanding heights of a national economy and still remain unsatisfied and in need of more profit. The on-demand access to capital is the main lifeline for the hegemony of the unlimited profiteers to succeed and most of it comes from the banking system and in many countries banking is a private enterprise.

 

To understand banking, it is essential to understand the idea of money. Money can be defined as a measure of credit to productive work, labour or skill. It is not exactly wealth, but is a quantified measure of share in national wealth that the possessor earned or inherited from his family with a commitment from society to honour the ownership of his share. It’s a measure or physical token of the possessor’s ownership in national wealth.

 

The symbol chosen to use as money shouldn’t be something that can be easily counterfeited. When communities were small and people had little means or necessity for a common standard for money, they either bartered goods or used commitments between individuals that could be transferred to any other individual (a rudimentary idea of money) to facilitate exchange of goods. As communities enlarged and economies expanded, metal coins were minted and used for standard money.

 

It is not necessary that money be backed by gold. Gold or other precious metals are not the most important items for human survival and are not exactly synonymous to wealth. Wealth is a combination of many things of value to human civilisation. Metals were used to mint standard coinage because they were not abundant and difficult to counterfeit. Historically, precious metals were considered synonymous to wealth because of their utility as a medium of exchange in international trade and as an integral part of high culture and tradition. When gold and silver from the Americas flooded Europe, the metals lost purchasing power. Since these metals were considered valuable and treated as wealth all over the world, particularly Asia, the Europeans could use the abundant supply of these metals from Americas to finance Colonisation.

 

Wealth is a product of human skill and labour applied on natural resources; even precious metals are processed with skill for usage. Civilisations that have the skill to use and reuse available resources in a sustainable way can survive. Money in circulation has to match the combination of skill and resources that transform into useful products and services to represent wealth.

 

Money, as medium to represent the value of goods and services, cannot be too abundant or scarce since it is also a quantitative measure of goods and services. Natural resources cannot be used as standard legal money as they are either abundant or scarce. An abundant natural resource as money is a non-starter, a scarce resource like gold as money causes deflation if availability can’t match economic growth and is also inconvenient to use for small and common transactions. Gold usage as common money is not feasible for economies lacking it. The cost of gold production increases over time as exploration, labour and processing costs increase.

 

Standard physical symbol that cannot be counterfeited is ideal for money, but nothing is free from counterfeit attacks in this technologically enhanced and informed world; electronic money makes it even easier to manipulate from a high level of authority. Even with these dangers from counterfeit attacks, standard legal money is preferable as the potential damage is relatively minimal in the overall scheme; also the fraud can be traced and identified if the whole system is not compromised at the highest level.

 

The common experience of people is that standard legal money continuously loses purchasing power or value over time; the money required to buy the same quantity increases over time. Since people can’t avoid using money, they are continuously insecure about the loss of purchasing power over time and tend to rush for more of it to maintain the same real value or earn a bit more through it over time.

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Narendra Modi: Opportunities and Challenges

After much dilly dallying, the Bharatiya Janata Party (BJP) and Sangh Parivar finally decided grudgingly to bet on Narendra Modi for winning power in Delhi. They had no option but to endorse Modi given the support he has on the ground and the widespread perception that the BJP leadership in Delhi is compromised.

The Modi candidature ends a decade long leadership crisis and confusion in the BJP and the larger Sangh Parivar. The party now has a leader with the potential to decisively influence the polity. It now remains to be seen how the Modi era can influence national politics? Would he be just another political aspirant for the post of prime minister, or will his track record make him a game changer?

Over the years, many have joined the Modi bandwagon for a variety of reasons; what is important is how his ideological core constituency, that stood by him in difficult times, looks at his evolution at the national stage. The majority seems happy and wholeheartedly believes that Modi would deliver on ideology and the net effect of his rise would be positive to them.

But, some ideological puritans see his evolution as compromising for the sake of power. They see the recent “toilets before temples” comment as an ideological affront, confirming their worst fears. Yet some of these very ideological puritans consider Vajpayee as the tallest leader, without even once bothering to critically evaluate his delivery on the ideological front while in power.

Despite delivering countless speeches on a variety of topics, Modi in some ways remains an enigma. It’s difficult to get to the bottom of his thinking, but one can get a sense of his mission by looking at his decade long track record in Gujarat. Like every sensible leader, his vision is more about moulding the future than basking in self glorification of past. If we extrapolate his track record at national level, he could well lead an Indian renaissance without compromising the basic Hindu character.

The Congress party has dominated for almost six decades due to division in Hindu votes. Historically, most land-owning, middle segments of Hindu society were hard core anti-Congress, while the traditional Hindu elite, minorities and scheduled castes supported it. Since independence, both Congress and the Jan Sangh were represented at the top by traditional urban Hindu elites who failed to connect with and articulate the interests of the Hindu masses.

This vacuum was filled partially by Lohia-style politics, the Left, and other regional leaders. The Sangh Parivar for long failed to evolve a program and leadership that could connect with the masses. Narendra Modi is the first truly mass leader of Sangh Parivar stock who connects with both the elite and the masses. Current trends indicate he is gaining support amongst the powerful anti-Congress Hindu constituency that was for long uncomfortable with the Sangh Parivar ecosystem, but supported the Janata Parivar, Left and regional parties. This could lead to a tectonic shift domestically, with the consolidation of Hindus at all levels behind Modi, and thus a much broader Hindu representation in the corridors of power in Delhi.

Ideologues of Hindu nationalism are traditionally wary of western influence and tend to over-idealize the autonomous village life and associated socio-administrative structures. Their position on modernity is vague, and when forced to take a position will speak of “modernization without westernization”. This is a kind of oxymoron; current modernity is hugely influenced by western ideas, economics and technology. As an example of “modernization without westernization” they cite countries like Japan, but in truth the economic-cultural life there is not very different from the West, and is in fact very much integrated with the West.

More than romanticizing about the past, Hindu nationalism needs a comprehensive blue print to evolve a holistic alternative to the adharmic development of the modern world. Modi seems to have realized this. In Gujarat, he gave impetus to modern manufacturing with plans for new cities on waste lands. Simultaneously, he focused on making rural life, economy and administration more autonomous. This approach would help a long battered Hindu civilization gain some strength and ability to experiment with ideas from its past. The present cannot be completely ignored for some utopian past. The present demands an approach that would make India an independent economic and military power. Modi’s emphasis on energy security with renewable energy, indigenous defense production and environment protection are steps in that direction.

In October, Gujarat organized a Vibrant Global farmer’s conference; over 10,000 farmers across the country participated. The government of Gujarat honored best performing farmers across the country with cash rewards. When was the last time a national leader bothered about farmers? Perhaps, the last big leader who talked about farmers was Lal Bahadur Shastri. Those who claim Modi’s development approach is corporate-centric should listen to his valedictory speech at the farmers meet (link here).

He has rightly diagnosed the issue ailing farm economy across the globe – the inability of the farmer to sell his produce on his terms. If Modi can successfully address this at national level, by letting farmers self-organize, it would automatically create a healthy balance between urban and rural economies. Also his idea of equal distribution of GDP between Agriculture, Manufacturing and Services with focus on SMEs would translate into a more decentralized healthy economy with prime focus on professional skills than “invisible” market forces or stock markets.

Modi’s approach in Gujarat suggests that he is adapting old Hindu socio-economic ideas that evolved from core spiritual values to modern reality. The real test for him if he manages to win Delhi would be whether he can politically, economically and culturally liberate India’s seven lakh villages, municipalities, corporations, from power brokers in Delhi and state capitals. The imbalance in the system to a large extant can be corrected with optimum decentralization.

The decentralization of power structure could give vast scope for asserting and expanding Hindu cultural identity. Temples can be made autonomous cultural centers and communities can decide on their social, economic and cultural choices within broader national framework. Water conservation, cow-centric organic farming, ayurveda, renewable energy, hygiene, bio-diversity can be more easily promoted at grassroots. It would give scope for society to lead the change than state forcing from the top.

A big challenge for Modi would be zealously maintaining the country’s territorial integrity amidst claims of hostile neighbors. The complete integration of Kashmir a necessary pre-condition for sending a strong message internally and externally. A uniform civil code is an important step for social integrity. Either minorities have to be brought under common law or the state should stop interfering in Hindu social space. Modi and BJP are right in not making Ayodhya an electoral issue. But, in power he cannot sidestep the issue for long and efforts have to be made to bring closure with a grand temple at Ram Janmabhoomi.

Another challenge is to make BJP a political party that better represents the diversity of Hindu society at all levels. The party may get wider support in the next election, but it’s very important to consolidate the surge with diverse representation in organization. The party shouldn’t be held hostage by political pimps in Delhi with no mass base. High command authority has to be sanctioned by grassroots workers through a credible democratic process.

The Modi phenomenon is exciting, gives hope to Indians after a long period of cynicism. The fact that he has managed to maintain consistency for the last twelve years against all odds gives credibility to his ideas and actions. The 2014 general election would be most decisive for the future of Hindu identity and Bharat bhoomi.

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Science, Civilization and Dharma

Modern Science is the new great gospel for humanity.  Scientists are the new age prophets. People at large are impressed by the dazzling achievements of modern science. Modern Science is considered all time greatest benefactor of man. For many it’s even unthinkable and blasphemous to question well established, standardized, popular theories of science. These scientific theories are well entrenched in the modern consciousness and there is hardly any modern profession not influenced by it.

Physical sciences are considered the foundation of modern science and Physics is crowned as king of sciences. Some argue there is no real distinction between Physics and Mathematics and both should be considered as one natural science. The scientific community and the world honour Issac Newton as Father of Modern Science. The invention of Calculus is attributed to Newton. Some Indian scientists trace its origins in India, and every high school science student knows Calculus is central to physical theories. Newton used it to create a comprehensive mathematical framework that fits in ideas of Galileo and Kepler Laws of Planetary motion.  He formulated three laws of motion and a Law of Universal Gravitation. He introduced the concept of “Force” in his framework and quantified its relation to motion of bodies.

Newton’s gravitational force was considered spooky by some of his contemporaries as he couldn’t explain the origins of this force and how it acts at a distance. He himself said

“To suppose that one body may act upon another at a distance through vacuum, without the mediation of anything else,…is to me so great an absurdity, that I believe no man, who has in Philosophical matters a competent faculty for thinking, can ever fall into.’ ”

But Newton’s mathematical framework is a powerful approach and the first serious attempt to quantify the physical phenomenon. From Newton the focus of scientific methodology shifted more to mathematical quantification of physical world than explaining its fundamental causes.  Subsequently, the discovery of Electromagnetism and the brilliant mathematical triumph of Scottish Physicist James Clerk Maxwell by predicting electromagnetic waves reinforced the primacy of mathematical equations that fit the physical phenomenon over explaining the causes. Causes have to be seen and interpreted from mathematical equations.

The Newtonian framework couldn’t fit the properties of electromagnetic waves as supposedly concluded by the result of Michelson & Morley experiment. This led to Special theory of Relativity followed by General theory of relativity that discards absolute motion, absolute time and ether, and postulates that light moves at constant speed irrespective of relative motion of observer. Though Lorenz created the foundational mathematical framework for special relativity he wasn’t that well recognized or became popular like Einstein. A lot of scientific mythology is built around the Special & General theories of relativity; it’s very hard to say if anybody really understands them. The theories are neither conclusively validated nor there is any big technological breakthrough from them.

Along with relativity first half of 20th century also gave birth to Quantum mechanics that blurs the distinction between particle and wave. Both Relativity and Quantum mechanics involve complex mathematical models that try to quantitatively fit the observed phenomena than any attempt to explain the fundamental causes.

So the question has to be raised on the objective of modern Science, is it just limited to record keeping or can it explain the causes and origins of universe?  If it’s just record keeping or imitating what’s available in nature with technology, then perhaps human mind won’t be enamoured by its methodology for long. The second half of 20th century hasn’t seen much progress in core understanding of physical nature.  It’s time for modern science to reinvent itself.

For modern science to move into next orbit it not only has to reinvent but also redefine its role in achieving civilization objectives. Civilization objectives? do they exist?  Yes, they used to exist when man was not too much worried about his economic survival. For Indic civilization “Dharma, Artha, Kama, Moksha” were the objectives.

Many champions of Indic civilization claim they had hoary scientific past, they claim Vedas and traditions are repositories of all knowledge. But world doesn’t take claims seriously without conclusive demonstration. Some Indic civilization lovers in their over enthusiasm to claim superiority over west compare the philosophy in scriptures to the theories of modern science like relativity, quantum mechanics. Why should they keep modern science as their benchmark? Why can’t they explore some original ideas from their scriptures and go beyond what’s known to modern science?

       This writer doesn’t claim any expertise in Indic scriptures or philosophies except for few shlokas in Bhagwat Gita that interests him. One of the shlokas in BG (ch 7 .4)

                                              

                                            bhumir apo ’nalo vayuh
                                     kham mano buddhir eva ca
                                       ahankara itiyam me
                                     bhinna prakritir astadha


 Earth, water, fire, air, ether, mind, intelligence and false ego—all together these eight constitute My separated material energies.

Modern Science deals with only four elements (Earth, water, fire, air) after Einstein banished ether. Krishna is talking about three more elements (mind, intellect and ego) even beyond panchatatva (Earth, Water, Fire, Air, Ether). Many Indic experts consider theories of modern science as gospel though many question them in west where they originated. Another shloka from BG (11.32)

      kalo ‘smi loka-ksaya-krt pravrddho
lokan samahartum iha pravrttah
rte ‘pi tvam na bhavisyanti sarve
ye ‘vasthitah pratyanikesu yodhah
                                     

 

                The Blessed Lord said: Time I am, destroyer of the worlds, and I have come to engage all people. With the exception of you [the Pandavas], all the soldiers here on both sides will be slain.

The above shloka refers to universal time; modern physics defines its own time and makes it relative to observer. The shloka also indicates death is inevitable for all existence, but modern science formulates matter & energy is conserved and cannot be destroyed. Shouldn’t we question then why world is facing energy scarcity? What’s happening to all the energy coming from the sun? Why should energy conservation law hide behind entropy? This author may be wrong in the interpretation of above shlokas or scientific theories, but the larger point is modern science is not beyond scrutiny and if anything interesting is available from other sources it should be challenged, that’s how knowledge progress.

The time has come at this point of Global human civilization to move from knowledge of gross elements (earth, water, air, fire) to the knowledge of subtle (mind, intellect & ego). Going by the claims of Indic Scriptures and tradition it seems Indic civilization had vast expertise in the subtle element and the use of it in achieving civilization objectives of Dharma, Artha, Kama, and Moksha taking man closer to his cause. Can Indic civilization get that ancient knowledge back or it’s beyond any recovery another incarnation or intervention of the divine is required to start over from the basics again?

   

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Can NaMo do a NTR at national level?

    The drubbing Bjp got in Karnataka assembly elections indicate how far the party moved away from the ground realities. The party lost Uttarakhand, Himachal and Karnataka inspite of despondent mood in the country on pathetic state of affairs under UPA regime.  The people are refusing to see any hope in any party.  They are going for ruthless revenge against non-performing incumbent governments, mercilessly slaughtering governments overlooking party affiliations.

People are desperate for an alternative but they don’t see any credible alternative, they see opposition party as useless as the pathetic govt. The opposition in Delhi is invisible to them with no credible leader on the horizon. The rot in the opposition needs a big thesis by itself, in summary opposition party is an abysmal failure with non-entities pretending as leaders taking it closer to extinction each passing day.

Though people have no faith in Bjp as an alternative they look at Narendra Modi with interest. He is kind of enigma to them, not a run of the mill politician, they see some distinct leadership qualities in him. His talk and mannerism creates an impression that’s very different from what they have in mind for a typical politician.

Though Narendra Modi has huge committed following across Urban India, his rural impact is yet to be tested. For the Bjp supporter he is the only credible hope if the party has to even stay in the game of next govt formation.

The Indian voter has double standards with Bjp vis-a-vis other parties, particularly Congress. They see congress as a default ruling party and expect other parties to show how they are different from Congress. The opposition should bring some value to the table, either with credible leadership or an agenda.  Wherever it has its base intact only under extreme irritation Indian voter reject congress for other parties.

Historically,people rejected congress whenever a credible leader emerged against it, a Jaiprakash  Narayan during emergency or a V.P Singh after the Bofors scandal. However these leaders fought against congress by uniting splintered opposition forces, as soon as the battle was won their internal contradictions pulled them apart, each time strengthening the impression in the voter’s mind that congress is natural party of governance for this country.

At the regional level alternatives periodically emerged to congress after long efforts of political consolidation by making or breaking social alliances. But, perhaps no other leader in the country was as remarkably successful as NTR in breaking the back of congress party in a record short period of 9 months after forming the party. His politics, strategy and campaign style is worth a study for any leader who wants to uproot congress from the country. NTR couldn’t totally destroy Congress as his clout was regional and the poisonous roots of Congress exist in Delhi. As national front chairman he still made all efforts to bring opposition together to challenge congress.

chaitanya_ratham

NTR strategy was very different from the onset; he took politics to the people away from Durbari culture. For the first time a political aspirant in India was on the roads meeting and educating people. At the age of 60 his Chaitanya Ratham (Chevrolet Van- read here,watch here, watch here) travelled close to 75,000 kms reaching every nook and corner of Andhra Pradesh. He ate with people, slept in his van, took bath on road side, such was his commitment to uproot congress from power. As an actor NTR was extremely popular in Andhra Pradesh but he took no chances against formidable Indira congress. In each constituency NTR visited during his campaign he brought up local issues invoking Telugu pride, made brutal frontal attacks on congress with choicest telugu words.

NTR’s campaign reached people’s hearts. He mingled with people, called them Gods and society a temple. When he became CM he took oath amidst common people in a stadium. All these could look symbolic but they send a deep message to people. With a very positive mandate NTR presided over changes that decisively influenced Andhra Pradesh for good, no CM can even come close to his personal integrity and what he did for Andhra Pradesh.

Currently, In Modi, people see for the first time after independence a non-congress leader with a pan India following based on his integrity, leadership and track record. He is the best bet for an NTR style campaign at national level to uproot the poisonous congress tree. India has 543 lok sabha constituencies. Can Narendra Modi spend half a day in each constituency, talking local and national issues, invoking national pride, making frontal attacks on enemies of nation, mingling with people without compromising his security? He has done it in Gujarat to some extent but an all India campaign will test the limits of his capacity.

NarendraModi_vivek_yatra

To demolish congress mafia forever there is no other option than educating people by reaching out to them. Narendra modi campaign should be unprecedented at the national level, it should have high voltage impact. His campaign videos must be translated into regional languages and showed all the way through his national campaign trail. He has to start now, there is not even a second to waste, and elections could be announced any time Only Narendra Modi can do NTR at national level to permanently bury congress. Bjp Delhi non-leaders presiding over decision making bodies cannot pretend oblivious of this historic responsibility to uproot congress nationally, if they don’t act the supporters are ready to bury the party in a deep pit.

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