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There is only one goal. That is to be whole again.

There is only one goal. That is to be whole again. How human beings live and work determines whether they remain whole or are split. ...

5/31/14

Gandhiji was the greatest of the great. Like Krishna, Christ, Zarathustra, Buddha, and Mohammad, he brought light to our planet. He changed the trajectory of history: macro-history -- without him the beautiful country I was born and grew up in would never have existed; and micro-history -- my father (an economist) upon reading Gandhiji's autobiography in its original Gujarati (both his and Gandhiji's mother-tongue) changed his life and I was born not just living but breathing Gandhiji's message.

And yet, outside of India, Gandhiji is seen more as a symbol than as a great thinker. Gandhi statues are erected everywhere (I think this is wonderful!) but how many people read even 1 of his 100 books? He is certainly not recognized as a great philosopher and economist. For those of us who grew up knowing him, in person or in spirit, that is a matter of deep sadness. We know his greatness intuitively and instinctively but the wider world while recognizing Gandhiji's greatness as a person does not as yet recognize his greatness as a thinker and economist.

I am concerned with Gandhiji being recognized as a great economist. To be a great economist, as Robert Heilbroner author of The Worldly Philosophers points out, you must be a great philosopher. So we must establish that Gandhiji has been recognized both as a great philosopher and a great economist.

Richard Sorabji's brilliant book Gandhi and the Stoics: Modern Experiments in Ancient Values is a closely reasoned analysis by one of the most respected philosophers of our time that concludes that Gandhiji was, contrary to general opinion, a great, consistent, and brilliant philosopher. Sorabji applies the highest criteria of intellectual rigor to test Gandhiji's lifelong writings and is satisfied that Gandhiji applies logic and reasoning at the highest standard and should be considered as one of the greatest philosophers who ever lived.

E. F. Schumacher, author of Small is Beautiful, was one of the world's great economists. He gave a talk in India late in his life where he prophesied that Gandhiji would one day be recognized as a great economist and even perhaps as the greatest of them all.

So what is going on here? Two of the greatest minds in the world, two scholars with impeccable credentials, have told us that Gandhiji was not only a great thinker but also a great philosopher and great economist! How is it that the world continues to miss this very important point? I think there are 3 reasons why Gandhiji is not widely recognized as the great economist-thinker-philosopher that he was. The 3 reasons are 1) Methodology; 2) No one reads Gandhiji; and 3) Humor.  I will discuss each reason below.

1. Methodology

Like it or not modern economics worldwide employs the methodology of neoclassical economics. The original and broader meaning of the term neoclassical is an approach that tries to perfect nature's shortcomings. It is an attempt to create perfection where perfection does not exist. It is a system that takes it as its duty to correct the imperfections of human beings to create a uber-perfection.

Under this system there is only one correct way. Economics is treated as a convergent problem, where solutions converge to one single solution. The result is singularities that are rigid, dogmatic, and vulnerable to cyclical crises.

Gandhiji's economics, on the other hand, is gothic. I use this term as used by John Ruskin. It was upon reading Ruskin's book Unto this Last on a 24 hour train journey from Johannesburg to Durban in 1908 that Gandhiji decided to create his own economics. He writes in his autobiography in a chapter entitled The Magic Spell of a Book:

"The train reached there in the evening. I could not get any sleep that night. I determined to change my life in accordance with the ideals of the book."

The gothic methodology involves the acceptance of the fallibility of humans -- their imperfections. So Gandhiji's economics treats economics as a divergent problem, with divergent solutions. There is no one correct answer, no one correct Gandhian economics. The point is for us to explore solutions together. The result is multiplicities that are rich, varied, and resilient. If you think about it that is the approach of nature. I believe that this gothic methodology with divergent solutions all held together and accepted, was Gandhiji's genius as an economist. Of course as you can imagine it was precisely this multiplicity, this not-knowing, this refusal to play God is what made so-called intellectuals, especially in the West, unwilling and perhaps unable to appreciate Gandhiji as a great economist.

2. No one reads Gandhiji

And here is where we come across a major problem. While there are many books written about Gandhiji and his ideas, not many people actually read Gandhiji's own writing. As Makarand Paranjape puts it, "Gandhi is either pre-read or unread." He means that Indians assume that they know what Gandhiji said (pre-read) and outside of India he remains largely unread.

No more excuses! Navajivan Trust, in Ahmedabad, India, the original publishing house for all of Gandhiji's writings has, in the spirit of Gandhiji himself, made all his writings available in the public domain, without copyright, without royalties. Anyone may publish and distribute them. And more to the point -- anyone may read them for free.

We should all devour Gandhiji's own insights into economics which are contained within each and every piece of his writings on each and every subject under the sun.

3. Humor

Gandhiji, like the great Zen masters, was full of humor and used it with great and nuanced intelligence to awaken his listeners into realization of truth. For instance, when pressed by economists of his time along narrow neoclassical lines, he told them that he had not undertaken a study of the 'great' neoclassical tomes and begged their forgiveness for being a "sinner beyond redemption".

Gandhiji's humor here is so transparent for anyone who is not brainwashed by a strictly convergent framework of analysis to see. He is pointing to the uselessness of the so-called 'great tomes' of economics, telling his listeners that he sees no value in them and would never ever see value in them!

Of course as you can imagine, this humble yet brilliant humor has been misunderstood for ignorance of the subject. When we re-read Gandhiji's words with an open mind today, we can see his genius quite easily and enjoy his humor unequivocally.

Gandhiji's sense of humor was at its greatest in old age, when he was with the many children always flocking around him at the ashram. One long-standing joke amongst them was that Gandhiji was the ugliest man in the world. To tease him, a child would say innocently:

Bapu, today we saw a man who was so ugly, so ugly!

Gandhiji would respond with mock seriousness:

Really? Was he even uglier than me?

And the children would reply:

It is possible that he was even uglier than you!

At this Gandhiji would make an exaggerated face and act very sad for a minute, after which he would 'recover' with a twinkle in his eyes and all the children would laugh with him.

Fairy tales of the West are often about great and perfect beauty. Who is the fairest of all is the common refrain of a popular one. Neoclassical economics, born of that Western heritage derives from the old fairy tales of beauty and perfection and failed attempts at the imitation of it or the acquiring of it at great moral and human cost. Paul Samuelson, one of the most famous of the neoclassical economists called economics the "queen of the social sciences". I would suggest that modern economics has been more of a fairy queen, living in a fairy land, oblivious of the brutal reality of life for most people.

We must now look to the East, to Gandhiji, with ugliness rather than beauty as our point of reference. Life is very hard for most people in most of the world. Let us face it, life is ugly. Gandhiji understood this. He embraced the gothic and the ugly in the most palpably human way possible and created a new economics.










5/28/14

Output equals Income. What is produced generates an income that is equal to it. Understanding this is a matter of good economics. Disaggregating it is even more important.

Output equals the sum of consumption, investment, government purchases and net exports. Income equals the sum of consumption, saving and tax revenues. Putting this into symbols we have:

C + I + G + X = C + S + T

Moving the terms around a little we get,

I - S = (T - G) - X

Or

S - I = (G - T) + X

Dissonance in our saving and investment is reflected in the sum of the dissonance in the government's budget and balance of trade. I use the term reflected with care. I do not present a causal relationship.

There is so much talk about government budgets worldwide. There is so much stress, so much argument. No one seems to know what to do with the ballooning budget deficits on one hand, the unplanned and excessive surpluses on the other. International trade and its utter and complete imbalance gets everyone worrying for our future. And yet this unbalance in government, this unbalance in foreign trade in the aggregate is simply a reflection of the unbalance between saving and investment.

We must proceed cautiously. What is wrong with saving? Surely, the old pat answer that there is too little of it is looking at a small aspect of it and missing the big picture. After all as economist James K. Galbraith has pointed out the Soviet Union, right up to its dissolution, had very high saving rates! That did not help very much now did it? No, what is wrong with saving is not that it is too low but that the nature of saving, how and why we save, its very basis, is wrong. In the past a farmer would save seed, for planting in the future. We save money, but why? Is it not out of fear? So saving is driven in our modern world economy by fear.

What about investment? In times past the act of saving was the act of investment. I was once a farmer so I set aside seed (saving) in order to sow in the future (investment). Today investment is undertaken out of greed. We encourage a large gross volume of investment by rewarding it disproportionately to its real contribution to society. Hence we have the situation in the United States where billionaire traders of derivatives and other spurious instruments of investment pay less taxes than do school teachers. Greed drives investment.

To bring saving and investment into balance means to create the beginnings of a society where saving is done out of love not fear. Investment is done out of love not greed. We have the beginnings of that worldwide. There are so many communities, so many ideas springing up that beginning to create balanced saving and investment in our earth rather than extracting from the earth.

When saving and investment are in balance everything else is also in balance.

5/23/14

What is at the heart of Gandhian economics? It is an idea that is so simple. It is balance. What is at the heart of modern economics? Once again it is balance. Yet the two notions of balance are very different. The balance that I care about is complete balance. The balance that modern economics is based on called equilibrium, is an incomplete hence unbalanced balance. 

Gandhiji emphasized this point very clearly. His book The Wheel of Fortune is available as a free download at gutenberg.org. If you read this book you will see what I mean. Gandhiji is not against mill made cloth. He is not even against foreign made cloth. In espousing his idea of swadeshi as opposed to pardeshi, preferring locally made goods over those made at a distance, Gandhiji only seeks balance. He points out that the economic system has been tremendously unbalanced by British rule. Once all farmers were also spinners and weavers, supplementing the produce of the soil with clothing for the household. British economic policy destroyed this home based khadi industry and made India dependent on cloth imported from England. There were also in his time India-based cotton mills owned by Indians. He did not wish to put them out of business. Since they were unable to produce all locally needed cloth, a renewal of khadi would mean spinning and weaving in each and every household could make up the difference. With this balanced approach the massive trade deficit that India faced with Britain would come back into balance, the starving millions would once again have food and be clothed and Britain's overproducing cotton mills would reevaluate the logic of overproduction at murderous costs and scale back to human proportions. What a wonderful and complete vision of balance! 

E. F. Schumacher is widely known as the author of the beautiful little book Small is Beautiful. He has been called the father of humanistic economics, though he himself thought that it was Gandhiji who would one day be recognized as the greatest economist of all. Schumacher stressed a point that has generally been missed. In Small is Beautiful Schumacher says that the reason we must emphasize the small is that all emphasis in our modern world has been on the big. Modern economics inevitably leads to massive structures, institutionally and physically. Massive dams, massive global corporations, massive expensive technologies. It is this imbalance that creates our problems. Schumacher explains that small is beautiful because the whole world has erred so massively in the direction of the big. However, to err in the direction of the small would be just as bad! After all it is balance that we must seek. 

The notion of balance that is at the heart of modern economics is simply a balance between supply and demand. This is such a limited notion of balance that in practice it leaves the world more in a state of perpetual unbalance rather than balance. In focusing narrowly in balancing one small aspect of life, namely the material supply and material demand, the whole of life is left in a dizzying disarray. When we look around us we see that imbalance everywhere. There is so much wealth concentrated in the hands of the few. There is so much poverty. And both rich and poor suffer the consequences. 

If we are to truly develop a body of work that we can call Gandhian economics, we must base it on a holistic sense of balance. We must include everyone, women and men and children, rich and poor and the so-called middle class, westerners and easterners and those who have migrated from one hemisphere to the other. We must find the gaps in our economics where imbalances are creating so much suffering. When we focus our time, our thoughts on these and meditate upon them together, over time balance will come. 

When the world is in balance suffering will end. 


5/22/14

We can not expect harmony from the creation of disharmony. We can not expect balance from the creation of imbalance. These statements seem self-evident. You understand them. They make sense to you. But if you meditate upon them you will realize that modern economics is based on the exact opposite of these two statements.

We have come to expect great pain and suffering, the so-called growing pains, as society attempts to move forward. That is not harmony. That is not balance.

We live in a multidimensional universe. Yet our thinking is linear, two-dimensional. We expect to move in a straight line. We suffer now expecting great rewards in the future.

So all over the world in rich countries as well as poor there is great suffering. Disharmony. Imbalance. And all this is justified by a crude notion of progress that is linear.

But friends you know that life is not linear. Life is a cycle. Means and ends are always convertible terms.

We must live in harmony and balance in every moment of our lives, in all aspects of our lives. We must live in harmony and balance regardless of where we live, whether rich or poor. When we see life as the magnificent multidimensional cycle that it is we will accept nothing less.

And suffering will end.

5/11/14

Freedom is thought of in economics as the freedom of want. A want is a socialized version of a need. We may need to be sheltered from the elements but we may want a house. The need is for shelter, the want is for the house. The fundamental principle of economics is freedom. Freedom of want. You are free to want anything that you can imagine. The very engine of modern economies is based on this freedom. 

However, a larger freedom, a more fundamental freedom is freedom from want. That has not happened for people anywhere in the world. Where I live and everywhere I travel I see people in need. They are not free. They are working very hard to make ends meet. They are not free from even their basic wants: food, safety, a future for their children. 

We must focus on this larger sense of freedom. True freedom is freedom from want not freedom of want. 


5/10/14

Wealth is invisible. To make it visible the rich must display power. The rich have power only if the poor exist. Power does not operate amongst equals. Only love does.

When we find ourselves in a situation where there are a few who are fabulously wealthy we can reason that it is a society of incredibly uneven power relationships.

Since wealth is invisible the rich need to exercise power over the poor to make their wealth visible. This is happening everywhere in the world. The rich build ever larger homes for themselves behind gates and the poor have access to less and less land, less and less water. The rich create fantastical organizations that are multinational in scope, scouring the world for resources, employing millions at low wages, disrupting lives, polluting the earth. All this is very visible.

This is not a theoretical or abstract construct. This is reality. We live in a polarized world with a few who are fabulously wealthy and the many who barely scrape by. We live in a world endangered by the greed of the rich.

In this state of imbalance we are headed towards disaster. That is again not something theoretical. It is a fact.

What can be done? The rich must give up their ways. The rich must give up their wealth. The rich must invite the poor to share as equals, as brothers and sisters who are jointly and momentarily trustees of this planet earth.

If wealth is shared equally there is no power. Wealth would then be invisible. And society would be content. Suffering would end. As I said before, power does not operate amongst equals, only love does.

5/7/14

There is so much suffering in the world. If we stop and pay attention we can see it everywhere. I grew up in India. I now live in the United States. In both these countries there is suffering. Too much suffering.

I am not talking about suffering as a sophisticated psychological concept. I am talking about plain human, animal, and vegetational suffering. People are hungry. Animals are mistreated. Vegetation is destroyed unthinkingly.

How is it that there is so much suffering? If economics is the science of wealth it has clearly not worked for most people in India or the United States. Apart from a few fabulously rich people in both countries, people work hard, too hard, simply to keep things going, paycheck by paycheck.

So economics has not worked for most people. It has done them a disservice. It has impoverished them.

How can we rethink our economics so that it may be of real benefit? I would suggest the following:

1. Means and ends must be convertible terms. Gandhiji emphasized this so please pay close attention to this. Actions (means) that create suffering, environmental harm, dislocation of societies and lifestyles are not to be engaged in. That is because our means should also be capable of being seen as the ends! We can no longer justify violence in any sphere as a means to an end. The means are the ends and the ends are the means! Since our ends are peace and the end of suffering for all, the means can not include suffering.

2. Think small. We must engage with the communities we live in to create, share, and co-develop our economic resources as well as the fruits of putting these resources to use. When we think small we realize that production and consumption are not separate acts, they are two sides of the same coin. To consume local products means to produce local products and together they create local engagement and wealth.

3. End greed. We must begin to give up our greedy natures bit. By bit. There is no power in being wealthy unless someone else is poor. Wealth is simply power over others. Wealth implies poverty. And the cause of it is greed. But where does that power take us? Rich or poor, we must all die. Would we all not live better if we gave up our greed and started to enjoy each other, enjoy our animals and our beautiful planet earth?

This is only a start. You probably have many more ideas. Good! Let us each implement our own ideas without organizing, without categorizing, without classifying. That is what I call a Gandhian economics. It is the only way to end suffering. And we can do it. I am sure of it.