Capitalism and Inheritance

IT is often believed that the ability to pass on property to one’s progeny is an essential element of capitalism, without which the capitalists’ incentives will dry up and the system will lose its dynamism.

Labour Hours Lost During the Pandemic

THE International Labour Organisation (ILO) has for some months been bringing out a report that monitors the impact of the pandemic on the world economy, especially the labour-hours lost because of the lockdown and their ramifications. The statistics it provides are not compilations of official data from different countries; they are based on the ILO’s own estimates made with whatever information is available from these countries.

Billionaires and the Pandemic

WEALTH distribution data are notoriously difficult to interpret. This is because variations in stock prices affect wealth distribution, so that a stock market boom suddenly makes the rich appear much richer, while a stock market collapse makes wealth distribution less unequal overnight.

Asymmetric Effects of Growth and Stagnation

GROWTH under capitalism is associated with an increase in absolute poverty.

The Move towards a De Facto Unitary State

FEDERALISM is one of the basic features of the Indian constitution. In the constituent assembly, Professor K T Shah wanted the term “federal”, together with the term “secular”, included in the preamble itself, but Dr Ambedkar rejected it on the grounds that the federal and secular character of the republic was understood and did not need specification. The constitution in its seventh schedule spelt out the jurisdictions of the centre and the states in two lists, and areas of common jurisdiction in a third list.

Modi’s Agriculture Bills Push Imperialist Agenda

THE two bills rammed through parliament last week were objectionable in every conceivable sense. The very fact of their being rammed through the Rajya Sabha, without being put to vote despite demands for a division, was grossly anti-democratic. The fact of the centre making unilateral and fundamental changes in agricultural marketing arrangements which fall within the state list of the seventh schedule of the constitution was a blow against federalism.

A Government Unequal to the Task

A STRIKING aspect of the 24 per cent decline in GDP in the first quarter of 2020-21 compared to the previous year’s first quarter is the decline by 10.3 per cent in public administration, defence and other public services. This is a sector where the GDP is estimated not by the “output” of the sector but by the government expenditure incurred under these heads. The decline in the GDP originating in this sector therefore means a decline in public expenditure.

The Indian Economy on the Verge of Collapse

THE GDP growth in the first quarter (April-June) of 2020 over the first quarter of the previous year has been minus 24 per cent according to preliminary official estimates. But most knowledgeable people believe that even this is an underestimate of the actual contraction brought about by the lockdown. In fact, a former chief statistician of India, Pronab Sen, believes that the actual contraction would have been about 32 per cent.

GST Compensation: Centre’s Bizarre Stand

WHEN the Goods and Services Tax was introduced, and the states virtually gave up the power to levy indirect taxes which they had enjoyed under the constitution, the centre had solemnly promised that it would compensate them for a period of five years for any revenue shortfall arising from the shift to GST. The shortfall was to be assessed relative to what revenue should have been, assuming a 14 per cent rate of growth. It is this promise which had persuaded many states to fall in line behind the GST.

The Protracted Crisis of Capitalism

THERE is a commonly-held view that the current crisis in capitalism, which has resulted in a massive output contraction and increase in unemployment, is because of the pandemic; and that once the pandemic gets over, things will go back to “normal”.This view is entirely erroneous for two reasons. The first which has been often discussed in this column, has to do with the fact that even before the pandemic the world economy was slowing down. In fact ever since the financial crisis of 2008 following the collapse of the housing bubble, the real economy of the world had never fully recovered.

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ECONOMIC NOTES