By Susan Harris

“If freedom is what development advances, then there is a major argument for concentrating on that overarching objective than on some particular means”. When Amartya Sen said this he was critiquing growth-based development, but at the same time positing markets as spheres of freedom. In what he calls ‘real equal freedoms’ the consumer gets to act and engage in a richer life and expand his freedoms in the society. However critics have discussed this freedom as not opportunity but as imperative and shaped by market mechanisms; for example, the worker is forced to sell his labor since he is embedded economically in the capitalist system and it no longer remains a question of choice. Thus in the context of capitalism driven industrialization and development, and especially India, what we need to examine is whether this is freedom or exploitation. If we look at some of the popular statistical methods used to assess growth we can get a fair idea of what kind of growth is promoted.

The Gross Domestic Product or GDP is the market value of all final goods and services. The major flaw in GDP is that this is appropriated to mean economic growth and hence limits choices toward any other direction. The paradox of capitalism is to be noted here that despite growth or rising average incomes there is fall in standards of living in many parts of rural and urban India. Of course the general problem with approaches such as these is that they cannot account for human behavior or what they will do with more money. Therefore something like ‘opportunity hoarding’ where rich people amass more wealth and resources will necessarily not mean progress for the community. This is certainly another important methodological flaw when we consider per capita income, as this is a form of weberian individualism that reflects the progress of some individuals to stand for the growth of the whole nation. Indeed every developing country which aspires to be developed is motivated and impressed by its pantheon of star industrialists. There are two problems with this. Firstly since India is a huge country, growth of any section of the society because of its population will also reflect as India’s growth. Secondly it downplays a major component of capitalism which is the difference in social class. Especially between the rich and the poor the wealth accrues in the hands of the rich and the poor remain poor. Any kind of welfare measures by the poor help the poor but definitely not enough to access a level playing field with the rich so they may also reap the benefits of a meritocratic capitalism.

The Human Development Index or HDI was formulated by Amartya Sen and Mahbub ul Haq and considers life expectancy, income, knowledge and education to measure human development. Now this is a more holistic approach than GDP yet even in its new categories it seems to imitate arbitrary values as indicative of development. According to Sen if we are to compose an advanced life as one with relational and absolute freedoms where the absolutes such as no poverty, literacy, health, food are coupled with a sense of worth and dignity and motivation to maximize one’s potential (as Marx wanted) then the interaction between the two is a complex domain where a focus on material growth is misleading. Such an ethical dimension can be registered only if the crux isn’t capitalism as only absolutes need to be developed for growth in that system. Hence perhaps the glaring absence of environmental responsibility in this index as well.

As a response to these insufficiencies, the GNH or Gross National Happiness was conceptualized to measure psychological aspects of a good quality of life. Formulated and used in Bhutan, one of its advantages and possible response to the systemic control of capitalism is the shift away from a western model of development to one that is tailored to meet the demands of its culture. Criticized for collecting data based on surveys and abstract categories, what is overlooked is a clear set of goals such as sustainable development and environmental protection. While the frame might be distinctly Buddhist, the methodology itself is scientific and based on contemporary studies on economics of happiness. Further it is also to be considered if this subjectivity is a limiting or liberating because it is only in a capitalistic model that absence of economic growth spells backwardness or discontent or problems.

This is not to be read as a critique of capitalism itself, but of policies of the state and its goals. If we rethink state intervention as not providing the minimum but fostering change through redistribution of resources and opportunities then social welfare policies look misplaced. Does the National Food Security Act make access to food a basic right even when access to food is of fixed grains and cereals, and choices have been eliminated because direct benefit transfers have been scrapped? The lapsed Biotechnology Regulatory Authority of India Bill and controversy surrounding GM crops are of the same flavor. Should the state be protectionist or moderate? And if BJP’s prime ministerial candidate Narendra Modi can exhort the Indian that he can compete with FDI in retail and that it will not make India another case study for the invasion of Walmart, what is the suggestion? Is it a kind of economic subjectivism that drives the developed countries to pursue growth at all costs and masquerade exploitation as equal competition? Can the Indian subject challenge the onslaught of western competition in a globalized world where his position is that of a modified human who is a producer and a consumer?

Posted by The Indian Economist | For the Curious Mind