Prime Minister Singh’s message
“In a modern, democratic society, business must realize its wider social responsibility. The time has come for the better off sections of our society – not just in organized industry but in all walks of life – to understand the need to make our growth process more inclusive; to eschew conspicuous consumption; to save more and waste less; to care for those who are less privileged and less well off; to be role models of probity, moderation and charity”, said Dr. Manmohan Singh during the recent speech at CII.
The popular media and corporate leaders’ reaction
The more popular newspapers, such as the ToI, which to my mind are mostly about “Page 3 journalism”, expectedly expressed the opposing point of view, and highlighted Sunil Mittal saying “the kind of salaries the PM was referring to was far from being the norm of the industry and just a handful among the total workforce got it…The PM’s message has to be taken in right spirit. His concern was in view of the wealth inequality in the country…It’s the in-your-face expenditure that hurts the have-nots. He meant ostentatious display of wealth which should be avoided”. Thank God for papers like the Indian Express, whose editor offered a fresh view on Singh’s speech, pointing out that “one thing which you can never fault Prime Minister Manmohan Singh is on facts…So on the fact of trinity of sins the Prime Minister is spot on. Greed, ostentation and cartelisation…do not merely exist, they have been growing…”, and then deservedly bashes the government on not delivering to the rest of India – the Bharat – while blaming the corporates alone, in a review titled “Economic Deforms: Blame the Bentley, don’t fix the road, school or hospital”.
The statement by Sunil Mittal is misinterpretation, if not intentional convolution of Singh’s speech. For instance, the PM mentioned ”…to eschew conspicuous consumption; to save more and waste less; to care for those who are less privileged and less well off; to be role models of probity, moderation and charity”.
What could define “conspicuous consumption”? Apart from the marriage madness (spending millions on marriages) that has gripped the minds of the upper-middle class and rich Indian, there is more to consuming conspicuously. The extravagance in our dressing (or under-dressing), in our cars, in our night life, in the restaurants we eat in, the night clubs we dance and drink in, the way our young make their hair, is all a ‘display of our money’ and ‘sense of power’. True enjoyment or happiness in not to be found in these things, as most spiritual leaders would advise, but that is best argued in a separate story.
Why Blame the Corporates? The Government is to Blame for not distributing the benefits
Ofcourse, the government is responsible for the state of the nation. Yet, what is also responsible is the money that drives these governments. Corporates drive policy all over the world. It is business and oil consumption that drove USA to war with Iraq, it is this same profiteering which is leading to GM seeds in India, leading to thousands farmer suicides. Even what the farmer grows in his farm is driven by government schemes and policy, which are further driven by the industry.
Don’t believe me?
Read P.Sainath’s “Everybody loves a good drought”. In a recent speech at a CII meet, Mani Shankar Aiyar, a part of the current UPA government, argued that policy is hijacked by a small elite (http://www.indianexpress.com/story/29112._.html). That the cabinet he belongs to is quite comfortable with this hijacking. That India’s system of governance is such that Rs 650 crore for village development is considered wasteful but Rs 7,000 crore for the Commonwealth Games is considered vital. The classes rule all the time, Aiyar says, the masses get a look-in every five years”.
So when Pratap Bhanu Mehta, in ToI, argues that the problems of Bihar or UP don’t stem from some CEO drawing a huge salary in Mumbai, I would say he is right, about the problems not stemming from CEOs’ salary. Though if the CEOs’ salary are part of a larger consumption and profiteering environment, completely based on non-sharing, then it certainly becomes ‘part’ of the problem.
So should we live like paupers, people might ask me? Do we not deserve a better lifestyle, because we have earned this all ourselves?
I’ll answer the second question first, which will be best described in context of Singh’s speech. He made a very important point – “The Social Charter I have spoken of is your responsibility to society at large. We in the government have our obligation to you as well.We have worked hard to create a business friendly environment, an environment which is conducive to rapid growth…the results are there for all to see. It is not by accident that the average rate of economic growth has been 9% in the last three years. It is not by chance that the savings rate of the country is 32% of GDP and the rate of investment has touched an all-time peak of 35% of our GDP. It is not by luck that the manufacturing sector is booming. It is not by good fortune that inward FDI is close to twenty billion dollars now. It is not by a miracle that we are today a trillion dollar economy. These are the results of balanced, prudent economic policies; policies which have focused on strengthening every aspect of infrastructure including airports, roads, railways and ports; policies which have reduced our revenue and fiscal deficits; policies which have promoted greater investment, both domestic and foreign; policies which have given a boost to manufacturing and services; policies which are designed to harvest the demographic dividend we are beginning to get from a youthful workforce; policies which have pushed development into our rural and backward areas; policies which have made India a great place to do business. ”.
I’m afraid not much has been said on this statement. I believe Singh meant, that for the corporate leaders to believe that they have been able to create all this wealth by their own intelligence and hard work, is a half-truth. The circumstances and environment in which they can grow has been created by the government, and thus they owe the money they have earned to society to be fed back to it. I believe this is what our PM was telling the “elite” gathering.
“What comes from the people must go back to the people many-many times over” – this was the famous statement by JRD Tata, which has been the essence of his work philosophy and driving force, carried forward with care by Ratan Tata – although I have a sense that this is beginning to lose ground. No enterprise will be on solid ground, by going against the interests of the people, on whose land it is looking to build industries and in some sense, these “temples of modern India”, to pick a cue from Nehru. No true temple worth its mettle can exist without the blessings of the common people, let alone by getting their wrath and anger, expressed through rallies, and yesterday – a suicide.
Singh’s statement holds extremely true when we look deep enough, and see that the power that is being consumed by the corporations, is reaching them by dispersing and destroying the land of millions of people. The power and water reserves, ostensibly created for bringing prosperity to millions of farmers, is mostly diverted to cities to feed the deep stomachs of the middle class and rich classes, the latter among which are the most waste-oriented.
A look into the day-to-day wastage of water and electricity in our homes is an example of this. Mr. Sunil Mittal may not agree, but consider the fact, that after all this talk of CSR, in all their offices in Delhi, they use plastic cups for water, specifically in visitor areas. Is it too difficult or expensive for them to use paper-based cups, or even better provide water glasses, and have them regularly cleaned, like Nirula’s does across all their restaurants? I am sure the same trend continues in all their offices across the country. Maybe, in this gigantic corporation, no one thought of being ‘environmentally conscious’. Yes, it could be true. After all Sunil Mittal cannot foresee all the small things, despite the right intentions. Yet, I must say, that an organisation is, how its leadership is. I suspect Mr. Mittal, never had the time or the mindspace to think of providing a leadership to its company which is conscious of the environment and people, it has earned all their billions from.
Frugality is Indian tradition; modernity sees frugality as poverty
Every now and then I come across essays from corporate leaders in the industry, specifically from the software industry, shredding the myth about Indians being fatalistic and not driving forward for a better life. Shedding off the the fatalistic attitudes that has penetrated deep in our psyche is a good thing. What is however not so good, is propagating living ‘rich lifestyles’, when millions of ‘us’ are living in abject poverty with no ‘equalness’ in opportunity to get out of that.
Infact, it is often in the interests of the ‘haves’ to leave the current ‘have-nots’ where they are, or at best make them grow, but at their own distinction, or the ‘market forces’ applying to them. To state from a day-to-day example…when it comes to negotiating the salary of an ‘Aayah’ at home, the salary bracket changes each year by some Rs. 100. Last year “the rate” for a house-cleaning-maid in the posh Vasant Kunj area in New Delhi that I live in was Rs.500. It is this year, Rs.600 for 1 hour of cleaning each of the 7 days a week. The state of the car cleaner, the chowkidar, the maali, the car driver, the permanent domestic help (‘servant’ or ‘maid-servant’, as they are commonly referred to as) is the same, all over. The same spills over to the lower-rung office staff, while the same corporates fall over each other in making the environments of the ‘haves ’ as comfortable as possible, with progressive practices as helping them adopt a ‘work-life balance’.
The ‘genuine love’ with which some of the ‘servants’ bring up our children is not payable by any form of money. The least we can do is compensate them adequately so that they can live better lives; and to take this a step further, maybe even push the slightly entrepreneurial ones in becoming self-employed.
So how should the wealthy live?
On the other side of the spectrum have been wealthy people who have led simple lives. Among the earlier industrialists of India, in my memory, JRD Tata, and lately, Narayan Murthy, are the ones who have expressed and lived high ideals of ‘living simply’ and ‘sharing wealth’.
It would be a good idea to quote the Mahatma in this context. ”…But what am I to advise those who are already wealthy or who would not shed the desire for wealth? I can only say to them that they should use their wealth for service…It is true that generally the rich spend more on themselves than they need. But this can be avoided. Jamnalalji spent far less on himself than men of his own economic status and even than many middle-class men. I have come across innumerable rich persons who are stingy on themselves. For some it is a part of their nature to spend next to nothing on themselves, and they do not think that they acquire merit in so doing.”
To not shake you off too much by the high ideals of Gandhi, here is a practical point that Singh made while quoting Keynes, “…European Society was so framed as to throw a great part of the increased income into the control of the class least likely to consume it. The new rich of the 19th century were not brought up to large expenditures, and preferred the power which investment gave them to the pleasures of immediate consumption…If the rich had spent their new wealth on their own enjoyments, the world would long ago have found such a regime intolerable…The duty of “saving” became nine-tenths of virtue and the growth of the cake the object of true religion.”
In simpler words, the point that Singh is making is, that while extravagant spending on oneself is a bad idea, and ‘saving for the future is healthy’, its even healthier to invest in making the cake larger, from which others can share.
One could argue on what is extravagance. I would recommend switch the thought process from ‘what is extravagant living’ to ‘what is simple living’. That may provide some insights.
Some facts for you to ponder over
I do not have all facts about India at hand while I write this article. Yet, here are some points which you may like to read. # India ranks eighth in the world in the number of our millionaires. We stand 126th on the Human Development Index. Last year we were 127th  # The number of farmer suicides in India since 2000 has been over 100,000 # The United Nations has purportedly reported that the world’s resources are not enough for India and China’s populations to live the lifestyle of Europeans, Americans and the Japanese.
I hope to expand this list of rather depressing ‘did-you-knows’ with time.
PM Singh’s 10 point charter
“You have all been the beneficiaries of our improved growth performance. When I read about the growing number of Indian millionaires and billionaires, about Indian companies buying up multinationals abroad, about our clogged airports, about the real estate boom, about new holiday destinations, about soaring CEO compensations, I know that you have benefited from the growth process….I invite corporate India to be a partner in making ours a more humane and just society. We need a new Partnership for Inclusive Growth based on, as what I would describe as, a Ten-Point Social Charter.
# Have a healthy respect for your workers and invest in their welfare. # Corporate social responsibility must not be defined by tax planning strategies alone. Rather, it should be defined within the framework of a corporate philosophy which factors the needs of the community and the regions in which a corporate entity functions # industry must be pro-active in offering employment to the less privileged, at all levels of the job ladder # resist excessive remuneration to promoters and senior executives and discourage conspicuous consumption. In a country with extreme poverty, industry needs to be moderate in the emoluments levels it adopts. Rising income and wealth inequalities, if not matched by a corresponding rise of incomes across the nation, can lead to social unrest # invest in people and in their skills # desist from non-competitive behaviour. The operation of cartels by groups of companies to keep prices high must end. # invest in environment-friendly technologies # promote enterprise and innovation, within your firms and outside # fight corruption at all levels # promote socially responsible media and finance socially responsible advertising
India has made us. We must make Bharat.”
For more details on each point visit http://pmindia.nic.in/lspeech.asp?id=548 to see the complete speech.
Mahatma Gandhi’s philosophy of Trusteeship is as follows, ”…We invite the capitalist to regard himself as a trustee for those on whom he depends for the making, the retention and the increase of his capital. Nor need the worker wait for his conversion. If capital is power, so is work. Either is dependent on the other. Immediately the worker realizes his strength, he is din a position to become a co-sharer with the capitalist instead of remaining his slave.”
Do I practice what I am preaching here? How can the readers of this article take back something to implement in their lives
Some people who know me, my family and friends, see me practicing portions of these truths, but of course there are glaring gaps between what I I’m saying here and what I practice. Yet, I must say that continually, I am challenging my own thinking, most often through the help and guidance of my mentors and coach, and growing slowly beyond the ideas of ‘ownership’ to one that of ‘trusteeship’.
To quote Mahatma Gandhi once again, not as a means to defend my slow evolution of thought and action, but simply to make the point that I am striving to live up to these ideals – “The question how many can we be real trustees according to this definition is beside the point. If the theory is true, it is immaterial whether many live up to it or only one man lives up to it. The question is of conviction. If you accept the principle of ahimsa, you have to strive to live up to it, no matter whether you succeed or fail. There is nothing in this theory which can be said to be beyond the grasp of intellect, though you may say it is difficult to practice…I adhere to my doctrine of trusteeship in spite of the ridicule that has been poured upon it. It is true that it is difficult to reach. So is non-violence. But we made up our minds in 1920 to negotiate that steep ascent. We have found it worth the effort.”
To quote him further, “Those who own money now, are asked to behave like trustees holding their riches on behalf of the poor. You may say that trusteeship is a legal fiction. But if people meditate over it constantly and try to act up to it, then life on earth would be governed far more by love than it is at present. Absolute trusteeship is an abstraction like Euclid’s definition of a point, and is equally unattainable. But if we strive for it, we shall be able to go further in realizing state of equality on earth than by any other method….But what am I to advise those who are already wealthy or who would not shed the desire for wealth? I can only say to them that they should use their wealth for service…”
 Article by Mani Shankar Aiyer in Indian Express
some good reads: * http://www.indiatogether.org/agriculture/suicides.htm * http://www.democracynow.org/article.pl?sid=06/12/13/1451229 * http://www.globalresearch.ca/index.php?context=viewArticle&code=SAI20070407&articleId=5296 * http://environment.guardian.co.uk/water/story/0,,1996350,00.html