BREXIT, a lesson the world should learn

“BREXIT” a lesson that world should learn.

The verdict of the people of United Kingdom to exit the 43 years long membership of European Union sent a shock waves across Europe and even across the world.  The Government of David Cameron was taken by surprise.  He resigned from his post of Prime Ministership. The majority of the parliamentarians of United Kingdom were disappointed by the verdict.  Jeremy Corbin, leader of the Labour Party faced criticism and the MPs of the Labour Party expressed their lack of confidence in the leadership of Jeremy Corby.

 It is clear that the members of the British parliament were not in tune with the life struggle of the majority of the people.  It has been stated that the majority of the people who voted in favour of exit were middle class, working and rural population.  Some argued that the people who voted in favour of exit did not understand the wider issues and benefits of the EU.  This is a false argument.  At best this argument shows no respect for the wishes and votes of the people.  These are the very people who elect their representatives to the British parliament.   Whatever dreams that EU had presented to the people did not reflect the aspiration of the majority of the people of United Kingdom.  They did not befit from EU.  For sizable population of UK EU did not mean a thing.

The conservative Government of David Cameron did not show much commitment to social welfare character of the state.  Their commitment to neo liberal policies was far too strong.  This approach of the conservative government was well suited to the policies of the EU.  These policies have given rise to the hardships of the common people.  The common people found it difficult to live under increasing unemployment, inequality and poverty.   The conservative government had diminished the Welfare State, especially in the National Health Service.

“A documentary on BBC Panorama about people who voted to leave and their reasons cite that
Unemployment, poverty and inequality were the main reasons because of which the people voted to leave. Immigration was another important and common reason for the people to vote to leave. They argue, the volume of immigration into Britain is too much which puts a strain on public services like health and education. Children aren't getting admissions to schools and people are not getting appointments with doctors. Immigrants also tend to work for lesser pay hence undercutting British workers. British people aren't being given priority for housing/housing benefits compared to immigrants.

Some said they wanted "their community/country back". Again this has some connection with immigration. As the volume of immigrants is high, the concept of society seems to have vanished.

Some businesses have also expressed concern with the amount of red tape that exists if they want to be part of the common market. They hope that leaving EU will mean getting back some control of Britain for the common British people.”

According to some report UK had benefitted a lot after joining EU.  Its GDP has increased by 10%.  UK was on par with Germany and US in the rising GDP.  In return it had to spend very little amount for the cost to be part of EU.  If this is true then the only people who benefitted from being part of EU are the corporate houses, big business and upper class.  The benefits of the EU membership did not go down to the salaried and rural masses. 

Way back in 1980ies many common people in different parts of rural Europe were suffering under the neo liberal policies of EU. In 1983 I had gone to Holland.  During this visit we had an opportunity of attending several meetings of the collectives of farmers in northern part of Holland.  I was surprised to hear them complaining against EU.  They said they were badly affected by EU and the process of restructuring their economy, commonly known as structural adjustment.

If any of the member country of EU faced financial crisis and need to borrow form IMF or European Central bank the loans came with very stringent conditions called “Free Market Reforms”. These conditions included cut in the government spending on social welfare programmes, especially retirement pension and health insurance; cut in household spending; labour reforms, wage cuts and reduction in the rights of the workers; privatization of public assets.

The manner in which nations after nations carry out labour reforms to maximize profit, invite foreign investments indicates that neither the labour nor the labourers receive any consideration.  Capital will not exist without labour.  Labour and capital are two inseparable parts of capitalism as a social and economic system.

Brexit is a strong comment on globalization.  It proves what David M Smick had written some time ago, “Today the future of globalization is politically unpredictable, fundamentally because the base of financial capital ownership is so small.  Meanwhile, the wealth gap is widening.  As a result, globalization’s political base of support remains tenuous at best.  Here is one astonishing statistic that makes the point: Today 40% of Americans do not have adequate liquid saving to live at the poverty level for three months, according to New York University’s Edward N. Wolf.  For a family of four, living at that level for that amount of time would require $ 5,300 in saving.” (David M. Smick, The World is Curved)

European Parliament and the People:

When people are ruled by the national government directly elected by them this government is accountable to the people.  The people can throw away the government whose policies go against the wishes and welfare of the people in the following election.

When it comes to the apex government like European Parliament which involves many other countries this government does not look at the aspiration and problems of the people of an individual country.  EU and the people of a member countries are placed at a great distance.  EU parliament is not directly answerable or accountable to the people.  The decisions made by EU may not immediately reflect the wishes and desires of the people.  Nor do the protests and opposition by the people to the decision made by EU have any impact on the European Parliament.

However, the laws made by the EU parliament will directly affect the people of the member countries.   These people will not be able to oppose or even question EU parliament as it is remotely placed.   Remote the government is from the people there are more chances that this government will make policies that will be beneficial the ruling classes.  This government will be guided by the macro level issues which often represent the interests of the big business and corporate houses of these states.  The hardship of the people will not be in the consideration of such government.  The European Parliament may work for the health of the economy.  But the health of the economy is measured by the health of the owners of capital.  The social welfare, employment, health care, pension will not constitute indicators to measure the health of EU.

In this sense EU does not stand for the general interests of the people of the member countries.  EU is almost like an association of corporate houses and big businesses that imposes its will on the people of member countries.  In many cases the sovereignty of the member countries will be compromised by the ruling of the EU Parliament.  To give an example, the World Trade Organization’s rules will not allow the member countries’ laws to function.  The patent laws made by the sovereign nation will be not be acceptable if these go against the laws of WTO.   The member country will have to amend its laws to suite the laws made by the WTO.  In similar manner the member countries laws and policies will have to be suitably amended to make them qualify ‘to be members of EU.

In case of Greece it had become evident how the EU overruled the vote of the people of Greece.  61% of the people of Greece had voted against austerity measures imposed on the country by EU.

With all the so called cooperation between the member countries of EU they could not prevent or even predict economic crisis on 2007 – 2008.  EU was part and parcel of the causes for the crisis of 2007 – 08.  These crises affected most the advanced countries like US, the members of EU.  The big business, corporate houses and financial institution can be bailed out by the states.  But the common people continue to suffer from these crises even today.

EU is no redeemer of weaker members.  It gives its members access to the common market.  There is a freedom of movement of labour.  But it does not reach out its hand to save the drowning members.  At worst the drowning members are made to drown more.  If any member nation does not abide by the policies of EU this nation is brought on the board and chastised resulting in hardship for the citizens.

If the common people from a strong member of EU, like UK, experienced hardship and voted themselves out of EU then what would be case of smaller economies?

Many have expressed that Brexit is a disastrous development.  If one would agree with these sentiments, then he/she should examine why EU has not helped the common people to improve their lives.  After UK voted to come out there was anger among the EU parliamentarians.  Some of the members of the EU Parliament, particularly from France demanded that UK should quickly complete the exit procedure.  It was evident that some members had no respect for the will of the people of UK.  Greece was unable to extricate itself from the octopus like EU and had to succumb to its pressure.

Let me quote here what I had written in the Indian Currents 27 July – 02 August 2015.

Socialist approach to the International Relations -- CMEA:

There was an institution in place among the socialist countries (socialist block). The name of this institution was “CONFERENCE FOR MUTUAL ECONOMIC AID”.

Under SOVIET UNION the option of a socialist world market was developed which should function as an alternative to the capitalist world market, providing new and better rules for international relations, banning exploitation and uneven development. The socialist world market was primarily a network of bilateral relations based on barter.

CMEA emphasized on rapid industrialization, which would provide in each of the CMEA member countries a complete industrial base with the same priority industries being developed at a faster rate in each of them.  This autarkic development policy was made possible by Soviet deliveries of energy and raw material.  The Soviet Union, GDR and Czechoslovakian provided the less developed CMEA countries with machinery. (Hans van Zon, Crisis in the Socialist International Economy)  Even India has benefitted from the Soviet Union investment in public sector industries.  USSR offered this without repatriating any proceeds from these industries by way of profits.

EU is far from such a spirit of cooperation and mutual aid.  The future of EU lies in learning lessons from CMEA.

On Education: Objectives

1.       “Access to knowledge: knowledge is widely available.

2.       Knowledge concept: teaching institutions.

3.       Knowledge creation: by those work in science, humanities

4.       Knowledge application: making knowledge practical and useful.

5.       Knowledge service: e-governance. People, citizens’ interaction with the government. Information and communication technology.

The best brains in the world are busy solving the problems of the rich –who actually don’t have real problem to solve. As a result the problems of the poor don’tget the right kind of attention, or the right talent to help them get through it.

Bringing the poor into the main stream meant making the nation's government inclusive, open and transparent. It meant providing information to everyone. (Sam Petroda)

II

Innovation:

Innovation involves thinking differently, creatively and insightfully to have an impact on social, economic values and development.

Innovation that can offer solution to the existing problems where conventional approaches have failed to deliver results.

Five most important things that matter in innovation:

1)       We need to look at innovation as a platform. Innovation is required in products, process, policies, plans and programmes. Innovation is about changing mind sets, organisations business management models, distribution, delivery and many more.

2)       Secondly inclusivity. Our job was not to create more millionaires, it was to lift millions of people out of poverty. Let us focus on innovation for the bottom of economic pyramid.

3)       Innovations happen in an ecosystem that fosters it.

4)       We want to properly define some of the elements of sustainable, affordable innovations. We want innovation in products that are durable rather than disposable.

5)       We have to consider the possibility of discourse. We need to create nation wide conversation on innovation. WE need to question the status quo and inject that habit of creative thought into the national psyche.”

Sam Pitroda

On Education: Objectives

·           To make young people to base their lives on solid moral principles.

·           Inculcating a vision for life.

·           Inculcating a vision for the society.

·           Individualism versus a collective. Personal aspiration versus collective aspiration. Fulfilling or working for their aspirations versus working for the aspiration of the collective.

·           History of people and the nation: To help them to locate themselves in the context of the history of the nation.Understanding the history of which they a part. They are product and they contribute to the history.

·           Making of the nation called India. Study what has made our nation.  How it has traversed through the history of people’s struggle to emerge as civilized human collective.The people, leaders who sacrificed their lives for creating this nation.

·           Valuing the work of the people for emancipation of people who have been disadvantaged, oppressed and marginalized.  Human collective that recognizes the aspiration of these people for equality, equity and justice.  Aspiration for justice for all is more important than aspiration for personal aggrandisement.

·           To make them understand the idea of India. Creating a nation they want to live in.  Democracy is based on historical reality of India and in interaction with global cultur; evolved value based democracy as an environment for all to learn and grow; environment of equal opportunities for all, equal participation and equal access to resources needed for growth of individuals and of human community.

·           Democracy is based on values of secularism; tolerance for people’s ways of life, thinking, faiths, religious beliefs and practices and culture; even more, sharing with people of other cultures to develop composite nation.  There are people belonging to different faiths, religions and persuasions. Making youth understand and appreciate other religions and faiths we will have lessons on all the religions in India.

·           Promoting dialogue, exchange and cross fertilization of religious ideals, values and ethos.  Study of all religious philosophies.

·           Looking at the nation in the context of the global scenario.

·           Value of democracy, socialism, secularism, tolerance, respecting diversity, living with differences.

·           Art, culture, music, religious heritage, history and philosophy.

·           Emphasis on learning English:  without English the rural youth will lag behind.  It will put them on the path of progress.

·           Study science with temper of philosophy; And study humanity with temper of science.

·           Create economic system that will be free from exploitation and bring about egalitarian society.

·           Study political science and politics that is value based, participatory democracy and governance.

Methodology:

·         Seminar and workshop approach and emphasis on Peer learning.

·         Learning to learn: Developing capacity to learn is more important goal of education than accumulating information and knowledge.

·         Developing the capacity to learn:  Empowering a person, making a person self reliant; to understand, comprehend issues, challenges facing a person, community; to search and find solutions.

·         Searching and researching. Exposure and social involvement.

·         Learning to think and problem solving.

·         Learning from one's experience.

·         Breaking out of moulds, thinking out of box.

·         Exposure to the world outside one's own.

·         Walking back in the history. Reading, writing.

Practical organisation:

o   Position ourselves in one place (village) where the school centre will be located. From there reach out to at least five village schools.

 

MGNREGA and Neo-liberal thinkers

Only the Neo Liberals argue MGNTEGA will not save the poor!

“Do no bet on MGNREGA to save the poor”.  Mr. Swaminathan has given us an eagle’s point of view of MGNREGA, full of big names and overwhelming statistics. But at a closer look he has tried to shoot in the dark by relying on ambiguous information.  I hope he is not deliberately trying to discredit the positive changes brought about by MGNREGA.   

Mr. Swaminathan suggests making tar roads have long term impact, and not mud roads, building embankment or de-silting tanks.  He gives the example of Bihar where double the amount spent on PMGSY.  In Bihar and for that matter in any other place when capital intensive rural spending is done it will definitely double the spending in comparison to spending on MGNREGA.  Under MGNREGA 60% is spent on wages which directly goes into the hands of the wage seeker.  But capital intensive spending will involve much higher spending on equipments and material compared to wages.  Here great proportion of spending will go into the hands of the material and machine owners and less in the hands of the wage seekers. Tar roads improve geography of rural areas but it does not speak of removing poverty of the wage seekers. Building embankments and desilting tanks improves water availability. Will he say that reduction of poverty in Bihar is because there was no MGNREGA?

Rural poverty is of the small, marginal farmers, landless labourers, dalits adivasies and women.  Capital investment goes to the people who have large tracks of land.  It does not benefit the small, marginal farmers and landless labourers. They will continue to remain wage labourers. Capital investment in agriculture (pump sets, tractors, and improved irrigation systems) benefitting the landlords, reduced employment in agriculture to less than 120 days a year.

He claims though Narasimha Rao introduced 100 workdays in 1994 and increased rural employment from 875 million person days to 1232 million and yet Congress was thrashed in the 1996 election. Clearly, voters didn’t think it solved poverty.  But he failed to mention that Congress won in 2009 because of right to work given by NREGA.

To relate the defeat of Congress in 1996 to non recognition of NREGS is trying to deliberately discredit the MGNREGA of 2005.  If congress was defeated it was due to devastating effect on the people of the structural adjustment policy adopted  Liberalization and privatization has led to closing down of innumerable small scale industries. The dismantling of the public sector, HMT, ITI, BEL, has led to innumerable people into unemployment.  Government has offered golden hand shake to force voluntary retirement scheme. NREGS was a safety net to prevent the poor from further falling into poverty and starvation. Growth is not directed to the agriculture sector.  On the contrary land acquisition for mega projects, destruction of forests, and displacement of rural population has very negative impact on the poor.

When NDA government was pushing reforms vigorously it was thrown out of power.  When Manmohan Singh came to power he started speaking about inclusive growth to overcome the scars of vigorous reform which had excluded the rural masses and the poor.

He claims that after 2008 rural wages more than doubled.  But he wants to attribute this to some extraneous factors.  We on the field have seen from a very close distance that when NREGA was paying higher wages and equal wages to women than the landlords who were paying much below minimum wages the NREGA made the rural labourers demand higher wages from the rich farmers.

Food prices rising globally might have raised wages only because under MGNREGA minimum wages were higher than the wages the landlords paid.  MGNREGA strengthened the fight of the agricultural labourers for better wages. Rise in food prices did not result in equal wages for men and women.  It is the NREGA equal wages for men and women made women to demand equal wages.  MGNREGA has given more money in the hands of the rural poor and their health, nutrition, children’s education has improved.

“MGNREGA is only palliative; it will prevent them from starvation”.  But the present growth oriented economy is putting all the propertiless in the urban and rural areas on palliative care.  The difference between the urban wage seekers and the rural wage seekers under MGNREGA is that the rural wage seekers will demand work as a matter of their right to work.  Of course these finer points Swaminathan will not understand.

Further he must also acknowledge that when the poor have rights to work, health care, education, food security, housing that their needs will be attended to.  In a capitalist society the poverty is not solved by the growth in the economy. 

GDP growth has attracted better off of rural population with education rather than unskilled labourers.  The National Sample Survey organization has come out with facts which show that the unemployment rate in the urban area between 2004-2005 and 2011-2012 has come down.  But in the rural areas the unemployment rate has remained the same.

MGNREGA has brought changes in the conditions of the people not in term of owning capital and accumulation of wealth but it has made rural poor get united and fight for their rights.  They now think that they have rights in the society and the government should ensure that they rights are delivered to them. MGNREGA has given more money in the hands of the rural poor. Their nutrition and health has improved. The fact that the children of the rural poor have access to education as their parents need not migrate periodically from one place to another is an important factor that will contribute to the sustainable change.

The capitalist society which spear heads for growth will essentially result in economic and social inequality in the society.  Growth and accumulation will result in concentration of wealth in the hands of the few.  It will create a few multi billionaires leaving the large majority of the population property less having to depend on wage labour.  It is only the struggles for rights that will keep the property less people afloat.  In the capitalist society people cannot fight for a share in the capital of the capitalist.   But they can fight for their rights enshrined in the constitution.  They can demand for right to health, right to food, education, and housing. 

Swaminathan’s last statement speaks for itself.  He holds a view that MGNREGA is palliative and sustainable poverty reduction required capital intensive rural investment. “Today I make bold to claim victory”.  We get an impression that he has already taken a stand against MGNREGA and he goes about searching for arguments to defend his stand.  He calls MGNREGA palliative, but he does not say a word about what he means by capital intensive rural investment.

If Swaminathan had boldly stated that the rural people should be made owners of capital, land, irrigation, access to credit and market which would reduce their poverty then his view would be credible.  But he would argue for growth that would deprive the rural poor of capital and turn them into wage labourers, not in MGNREGA but in the toll plaza, in the urban industries, working under contractors with no right to be organized or fight for better wages. 

 Alex Tuscano, Ganesh Iyer, and N.S.Bedi