If you were to answer the question, “What’s wrong with this world?” in one term, the answer is – “Neo-Liberalism”. By 1980, the world decided by and large that it was done with communism and everyone slowly shifted toward free trade. It was then that the concept of Neo-Liberal economic policies came into the picture. One might imagine this concept to be a progressive school of thought that ensures equality of all sorts but it is exactly the opposite. Neoliberalism policies are centered around free trade and free enterprise.
Neo-Liberalism is a liberal trade maneuvering for capitalist businessmen and enterprises that leaves no space for the development of the depressed section of the society which still struggles to afford basic human needs despite the technological and economic advancement all over the world.
Let us talk about India and its wealth gap. In January 2017, Oxfam reported that 73% of India’s wealth was owned by the top 1 percent of the population. A year before that, the percentage was 58. In 2018 World Inequality Report, India ranked ahead of US – Canada, Russia, China, and entire Europe in rising inequality since 1980.
In 2018, there are two separate societies existing in India. One is the privileged class which funds ruling parties. They are effective lobbyists and enjoy the economic benefits that the government provides them. The other is the downtrodden working class. They struggle for education, health care, jobs, and food. During campaigning of elections, this is the class that is most likely to vote any person who can make them believe that he or she will get them jobs and make their lives better. That never really happens and inequality keeps on growing. The problems with the land acquisition bill haven’t been resolved and the value for the consent of the land’s owner is limited to only the private sector. For PSUs and government project, the consent of people losing their land holds no value.
When the state support shifts from agriculture and petty businesses to large enterprise, there is a migration of workforce from villages to cities where these large enterprises operate. This leads to a large amount of labor, thereby reducing wages and cheap production. The urban population of India rose to 37.7 crores in 2011 from 28.6 crores in 2001. This leads to larger profit which boosts businesses further and wealth in the upper class of the society increases. Also, when a worker who owns land in his village migrates to the city because of failed agriculture, there is a possibility that he sells his asset such as land at lower prices even if that piece of land holds a higher value for a real estate or industrial enterprise. Thus there is a further loss of asset in the lower section of the society.
Privatization of education and health care ensures that the poorer section of the society is deprived of the same quality of education and health care facilities that rich enjoy. While the latest government initiative, Ayushman Bharat aims at providing an amount of 5 lacs for healthcare benefit, establishing healthcare centers and improving their state still remains a major problem. Primarily because the burden of healthcare systems falls on the state government. This leads to a lack of awareness, skills and other essentials required to generate moderate income. India specific factors like caste and religion based discrimination also play a major role in ensuring which section of society remains poor.
This problem of India cannot be solved in a day and there are no immediate measures that can be taken to resolve this but that should not convey a message that we can function even if this problem continues to exist. Neo-Liberal policies can damage the democratic structure of our society on their own. Following are some measures that could be taken for narrowing the wealth gap even if we don’t embrace communism:
- The middle class is that section of the society which pays the most taxes. Effective taxation policy, that reduces the burden on middle class and transfers it to the richer is required.
- Education and health care facilities should not be privatized. The basic human needs should be prevented from becoming a source of profit generation.
- The rising number of bank and tax frauds should be prevented. Effective regulatory bodies should be set up to check corporate frauds.