The Hindu Business Line : Is greed the issue, or the associated consumerism? Swati CA

Story so far: I visit a village clinic, and see Dr Karan in action. Shouldn’t rural service be mandatory for medicos, I ask him? More important than that is the need for diagnostic facilities in villages, he replies. He dreams of an India where everyone would undergo a free check-up every year. “Just think of how productive we would be as a nation when people can take appropriate measures early on, based on diagnostics. Also, when people know they are free from their imagined fears of illness, there would be greater happiness around…” Karan passionately describes his vision, even as I wonder if we could get enough corporates to pitch in for the cause.

Episode 166

Sorry for disappearing without a notice.

Your world can change in just 180 days. The way you see people, the way you thought things worked, the way you thought life would change…everything can transform and that is what I discovered in my sabbatical.

But when I look back at the days that I spent before attending the diploma in developmental economics, I think I lacked realism.

Models, you can make for just anything; but, for any model to work coherently, we need real situations and see whether they can stand the test of realism. “Economics with a human face,” I understand the meaning now.

It is strange that when my colleague told me about this step in April, my first reaction was of utter dismay and then gradually it turned to dismissal.

When he told me about the field trips that were a part of this course where volunteers would go into villages that had not seen a single megawatt of power and where child mortality is abnormally high (because the nearest medical help is 12 hours), I said to him, “It’s alright for you to appreciate the human side of things but why do I really need to go out there…I have enough problems already.”

Apologies to you Ramesh! Now I realise why farmers commit suicide. Let alone the complete breakdown of the extension system, the continued mismatch between farming costs and returns acts just to tip the balance to the detriment of the grower. Death can be at least peaceful. Apologies to all people who wrote to me and the huge pile of letters that lie somewhere unread. “Guess what…I cannot find my inbox.” My account just got reactivated but a lot of the old mails are missing. (Travails of being connected online) Switching to gmail now.

In a sense I feel like Rip Van Winkle now. Sleep. Ignorance is sleep, but what about the changes.

After returning, my boss said, “In the time you were gone, Swati we have a new division called CSR (Corporate Social Responsibility). I am sure your visits to the villages will help you interact with them. Our group is diversifying into steel. Some land has to be emptied and there are some occupants…”

When companies build power plants, dams and factories, what economic value do they add? To the country, state, natives or to them for whom nothing is too much…searching for answer.

For the uninitiated, welcome to the world of displacement. “It bothers me, it disturbs me when I see landless labourers being driven out from their homes when factories are proposed to be built,” my friend, who runs an NGO to look after the displaced, answered.

Conventional wisdom says foodgrain is not a problem anymore and the government needs to buy tonnes of it from foreigners just to serve other purposes. Of course, the new rehabilitation and resettlement (R&R) policy allows States to acquire 30 per cent land for private developers provided they have acquired the rest 70 per cent in case of industrialisation and SEZ projects. The policy also provides for land-for-land compensation, besides preference to affected families for jobs in projects coming up on their plots, says a news report.

There has to be a serious study to ascertain what kind of economic value the industry will make and at what cost. My neighbour, Professor Dilip Nagarajan, said just a few words. “There is an enormous opportunity cost that we are not looking at.”

Opportunity cost

Wikipedia.org says, in economics, opportunity cost is the cost of something in terms of an opportunity forgone (and the benefits which could be received from that opportunity), or the most valuable forgone alternative (or highest-valued option forgone), that is, the second best alternative.

“For example, if a city decides to build a hospital on vacant land it owns, the opportunity cost is the value of the benefits forgone of some other thing which might have been done with the land and construction funds instead. In building the hospital, the city has forgone the opportunity to build a sporting centre on that land, or a parking lot, or the ability to sell the land to reduce the city’s debt, since those uses tend to be mutually exclusive. Also included in the opportunity cost would be what investments or purchases the private sector would have voluntarily made if it were not taxed to build the hospital…”

Just when poor farmers manage to get on with a standard of living that was increasingly becoming difficult to sustain (thanks to inflation), they are told that there is something good that can be done with the land.

Nisha, a second year student pursuing IT, laments: “Farmers should be given the technology to optimise productivity.” Sorry Nisha, but the great Albert Einstein himself felt that sometimes we tend to be too reliant on the boons of technology. It has become appallingly obvious that our technology has exceeded our humanity. When potatoes are sold at Rs 18 per kg in a small vegetable shop in Vignannagar, the seller knows that it was less than Rs 8 a year ago.

Speculative urge

To add to that we have people even speculating on what prices of commodities will be three months down the line. Speculation. A word covering the making of money out of the manipulation of prices, instead of supplying goods and services! My auto-rickshaw driver asks his pal “20 or 19”. I mistook for some cricketer’s score only to find that it was the Sensex.

Greed does that to a man who gets around Rs 200 per day, after paying for the fuel and owner’s share. “How much is too much is often something we do not know. But we always seem to know when it is less,” Prathap who runs a broking house quips. The sheer breath of the Sensitive Index (is it sensitive anymore?) has baffled me. Before my Houdini act, I am sure I saw it at 13,200 or thereof. It is 20,000 and counting.

It is perhaps a sign of the society that we represent: we have become impatient. We want everything now and quickly. My only worry is the bigger they are the harder they fall. Shows like Saas, Bahu and Sensex have a tremendous recall value but they also point at the nationwide obsession that has gripped us all.

My cousin Jeeva invested some Rs 12,000 in an oil and gas company — they are worth Rs 24,900 now. “It’s more than 100 per cent return in just six months!” I cannot share her sense of joy. She hasn’t actually sold them off so it’s all notional wealth and will she be able to sell quickly, assuming the market falls. It’s a bad time to be a bear now and even worse for people who still hold their heads on their shoulders.

Are we becoming greedy as a nation? Haven’t larger issues being sidelined to the brink of oblivion, when Sensex swerves?

Isn’t six months too little a time for thirty companies to change their fundamental, leave alone the economy? Is greed the issue, or the associated consumerism, which feeds on resources?

Send in your thoughts by Friday.

SwatiListening@gmail.com

Blog at: http://Swati-CA.blogspot.com

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