The precious village holds India back
Saturday, May 24, 2008 at 10:49AM ARTICLE: "Shoveling for their supper: The world's biggest public-works project just got bigger," The Economist, 26 April 2008, p. 57.
An FDR-like public works project manned by rural poor, who can ask for and receive 100 days of work each year from the National Rural Employment Guarantee Scheme (NREGS), something the Congress Party dreamed up as a platform plank in its winning return a few years back (2004).
Why needed? It is estimated that 85% of state welfare spending fails to reach intended recipients.
Nice.
India will compare weakly to China for a long time because it exalts the village so, a bad legacy of Mahatma Gandhi, with all his self-sufficiency nonsense. So India doesn't try to lure rural poor into cities (plenty go there to find few manufacturing jobs anyway, as India's manufacturing base is a tiny fraction of China's 100 million formal sector job base), and "Shining India" (the BJP's losing campaign mantra from 2004) is largely informal (shadow economy, or gray market) and the service sector accounts for roughly half of formal GDP, meaning India basically leapfrogs to services and never bothers (yet) to seriously build up manufacturing.
Reader Comments (3)
The village is rooted in self-sufficiency and food security. The global economy, while efficient in some respects, is incredibly volatile and unstable. To grow dependent on something you cannot hope to control is not wisdom.
I think that the new technologies of decentralization are going to make India's bet on the village seem like a very good idea, as the export-driven cities of China peak and fade into rapid obsolescence as urbanization run its course.
The Chinese market cannot sustain that much urbanization. The export markets are driven by unsustainable borrowing. Push will meet shove, and what then?
Half of the human race lives in villages. Given cell phones, and eventually lap tops, given cheap pumps to irrigate, and cheap solar for drinking water, power and light, given primary health care from traveling workers... I think the slums look like a much less good, and much less *stable* option. Particularly with gasoline at $130 and rising: living close to your food supply makes more and more sense.
The golden age of the village is ahead of us, not behind us.
What the developing world needs is more Gandhi, not less.
The core of Gandhi's platform was Swadeshi - economic self-sufficiency. Global trade does not benefit all partners equally, and in some scenarios the market moves into equilibria that kill.
If you were poor, would you want to grow enough of your own food to survive, regardless of what the economy did, or would you rather be completely dependent for your survival on an international order that you do not control, that your government does not control - in fact, that *nobody* controls, subject to the whims of whatever emerges from the complex dynamic system that is the market?
There is a lot to be said for self-sufficiency as the only real food security there is. It protects from hyperinflation. It protects from global financial market crashes.
More Gandhi, not less, thanks.