Gandhian Economics

Economics of Abundance, Economics of Altruism, Economics of Goodwill etc. these are only a few synonyms for the panacea of all human suffering, that is Gandhian Economics. Largely misunderstood, quoted by many but followed by few. Gandhian economics is the spiritualization of the dismal science of Economics. It emphasizes on the importance of Gandhian principles of Swadeshi, truth and non-violence. Considered to be largely too philosophical and not at all practical but with problems like Global Warming, ill health due to lifestyle diseases like diabetes and high blood pressure, loss of morality because of extreme greed and little mental peace which are natural result of rapid economic growth it is gaining quite a lot of popularity among the dismal scientists and the public at large.

Gandhi’s economic ideas were a powerful tool against the Western capitalist exploitation of poor countries like India and masses of India at large. Though it was for all the deprived masses of world, it wasn’t exactly communist it is more like modified capitalism due its emphasis on individual’s moral character and drive. It is based on the idea of trusteeship. His ideas were a crusade against poverty, socio-economic injustice and deteriorating moral standards. Even though he was not an economist, his ideas had far reaching effects on the world.

Basically, it was J.C. Kumarappa who was a close associate of Gandhiji and an Indian economist who coined the school of economic thought known as Gandhian economics. He was a pioneer in rural development economic theory. He wrote various articles on the British tax policy and it’s exploitation of the Indian masses.

Gandhiji claimed in his newspaper Harijan that True economics never militates against the highest ethical standard just as all true ethics, to be worth its name, must at the same time be also good economics … True economics stands for social justice; it promotes the good of all equally, including the weakest and is indispensable for decent life on October 9, 1937.

His idea of economics totally contradicts mainstream economic paradigm of Greed is Good. That it is greed for superficial material commodities not an individual’s moral and spiritual drive to do something that would benefit humanity as a whole that is responsible for an individual’s drive to succeed and thrive.

He did not believe in the economic view of scarcity of resources but rather held the conviction that there is an abundance of resources and it is only due to wastage and over consumption do we have an illusion of scarcity. Hence he always said that nature has enough for man’s need but not enough for man’s greed.

Gandhi’s notion of revitalizing village India through the spinning wheel struck many as anachronistic, but the logic of his arguments took on greater force after his death. Gandhi’s economic ideals were not about the destruction of all machinery, but a regulation of their excesses. Khadi requires decentralization of production and consumption, which in turn should take place as near as possible to the source of production. Such localization would do away with the temptation to speed up production regardless of the costs and would alleviate the problems of an inappropriately structured economic system.

Gandhi’s ideas on swadeshi were summed up during his first major struggle in India and repeated almost verbatim throughout the next 30 years:

Swadeshi is that spirit in us which requires us to serve our immediate neighbours before others, and to use things produced in our neighbourhood in preference to those more remote. So doing, we serve humanity to the best of our capacity. We cannot serve humanity by neglecting our neighbours

Gandhiji was firmly against mass production and believed in production by the masses. The former provides dignity, meaningful contact with others and is appropriate in a country with a huge population, while the latter is violent, ecologically damaging, self-destructive in its consumption of non-renewable resources and dehumanizing for the individuals involved. A widely quoted Gandhian economist E.F. Schumacher trying to put Gandhi’s ideas into practice saw that the key to solving the dilemma of implementing Gandhi’s dream was the development of a level of technology which would be appropriate to the needs and resources of the poor with tools and equipment designed to be small, simple, low-cost, environmentally friendly and compatible with man’s need for creativity.

Gandhi had explained that while he was not against machinery per se, he did object to the ‘craze for machinery’. In one of his articles he mentions that the craze is for what they call labour-saving machinery. Men go on ‘saving labour’ till thousands are without work and thrown on the open streets to die of starvation. I want to save time and labour, not for a fraction of mankind, but for all. I want the concentration of wealth, not in the hands of a few but in the hands of all. Today machinery merely helps a few to ride on the backs of millions. The impetus behind it all is not the philanthropy to save labour, but greed.

This leads to what he termed ‘parasitism’:

Man is made to obey the machine. The wealthy and middle classes become helpless and parasitic upon the working classes. And the latter become so specialized that they also become helpless. The ordinary city-dweller cannot make his own clothing or produce or prepare his own food. The cities become parasitic upon the country. Industrial nations upon agricultural nations

Schumacher while researching on war and economics believed in the need for a non-violent economics. He stated that a way of life that ever more rapidly depletes the power of earth to sustain it and piles up ever more insoluble problems for each succeeding generation can only be called ‘violent’ … In short, man’s urgent task is to discover a non-violent way in his economics as well as in his political life … Non-violence must permeate the whole of man’s activities, if mankind is to be secure against a war of annihilation … Present day economics, while claiming to be ethically neutral, in fact propagates a philosophy of unlimited expansionism without any regard to the true and genuine needs of man which are limited.

Gandhian economics with its high pragmatic appeal can make a powerful tool for changing the way the world sees economics. With its application this world can certainly be a better place. But the human race must apply it before it annihilates itself for the constant human pattern of self-destruction never ends.

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