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I = S - M

The modern way of thinking about economics has been I = M - S Where I is the I as in me, M is what is 'mine' and S is what ...


Dear friends,

Thank you for gathering today to talk about Gandhiji, economics and the future of humanity. 

First of all what is Gandhian economics? It is the economics of Mahatma Gandhi. Gandhiji, as he is known to us who grew up in India (the -ji added after his name is in the Indian tradition of respectful address), created the finest and clearest approach to a whole economics that was part of and not separate from all the other aspects of what it means to be human. Gandhiji wrote prolifically and his collected works now fill 100 volumes. In each and every part of his writing are clues to his economics. He did not believe in separation, his goal was to heal the split in modern man and modern woman. So he wrote about economics the way he wanted his economics to be applied: not piece-meal but whole. We must therefore not look for his economics in any one volume of his many writings but instead for for it in all his writing. 

I believe (along with the late great E. F. Schumacher) Gandhiji to be the greatest economist who ever lived. To understand Gandhian economics though we must really look at all his writing, on every subject possible, to glean the deep principles and insights that he provides. These insights are embedded in thoughts and analyses of a multitude of problems, considerations and examples and must be understood in their entire wholeness, not separated out and distilled or summarized.

Well then, secondly, we must talk about what Gandhian economics is not!

It is not the economics of J. C. Kumarappa. Gandhian economics is the economics of Gandhiji just as surely as Keynesian economics is the economics of J. M. Keynes and Marxian economics is the economics of Karl Marx. Kumarappa may well have coined the term "Gandhian Economics" but what he wrote is simply one interpretation of what the great master had to teach and say. 

It is not the economics of John Ruskin. While it is true that reading Ruskin's Unto This Last made a huge and life-changing impact on Gandhiji while still living in South Africa and inspired Gandhiji to create the first of his Ashrams, their economics are actually very different. Ruskin was the product of his age while Gandhiji was ever the free thinker, unbound by tradition or rules of behavior. Let us take just one simple difference. Ruskin was, like many people of his time and place, brainwashed into a genuine belief in free trade. There is a footnote in Unto This Last (that many seem to have missed) in which Ruskin states this quite plainly. He was a free trader, while Gandhiji reasoned quite correctly that while free trade had made Britain rich, it had impoverished India. Gandhiji created the concept of swadeshi that has now spawned the buy local movement worldwide in opposition to the crude idea of free trade. 

Gandhian economics is a living, vital subject that is quickly gaining interest and developing worldwide. It is not a ready-made set of principles to be applied indiscriminately. The world has tried ready-made principles both in the Communist world and the Capitalist world. Neither has worked and in fact their failure has brought us to the brink of total destruction. As E. F. Schumacher taught us a long time ago, economics is treated like a convergent problem where we obtain one single solution to a problem when in fact true economics is a divergent problem requiring divergent creative approaches. I would add that true economics is also an organic problem requiring creative and organic transformation along with divergence. Gandhian economics fits the bill of a true economics perfectly and as I see it is the only hope for our, and dear young ones, your economic future. 

I would invite young people worldwide to explore this vital and important subject and contribute to the divergent and organic transformation of our world. Together we can do it, in our own lifetime.