I am writing this in the Ritz Carlton hotel in Riyadh. Months ago, some of the wealthiest persons in Saudi Arabia, who were forced to stay here, were released after they parted with large amounts of their wealth. Now hundreds of young, foreign, management consultants are swarming through the hotel’s lobbies and dining rooms. They are advising the Saudi government on how to develop the country.
I am watching reports on television from Davos where hundreds of the world’s wealthiest people have assembled for the World Economic Forum (WEF). The reports say that the number of business leaders arriving in Davos in private jets is larger than ever before. Very soon the young consultants will have to vacate their rooms in the Ritz Carlton for some hundreds of wealthy investors the Saudi government is flying from Davos to Riyadh in chartered 777s to induce them to invest in the country.
A star at WEF this year was David Attenborough, the legendary advocate of care for our planet. He fears it may already be too late to stop climate change. The backdrop to the TV reports from Davos is the banner: ‘WEF: Defining the Business Landscape’. In a few days, on January 30, the people of India will observe a minute of silence to remember Mohandas Gandhi, who was assassinated on this day 71 years ago. It would be worthwhile for people everywhere to reflect on his views about how business leaders should reshape the landscape to make the world better for everyone.
Gandhiji had no problem with wealth. He said business people should be expected to create wealth. However, he insisted they must see themselves as trustees of the wealth their businesses create, as well as trustees of the resources of the society and the earth they use to create wealth. A trustee is not an owner. Nor can the business the trustee runs on behalf of society become the owner of the natural resources it uses. Natural resources belong to everyone.
In contrast to the concept of trusteeship, the dominant principle in the governance of capitalist economies is the principle of property rights. With an unbridled principle of property rights, corporations can own large quantities of the earth’s land and resources to use as they will. Whoever owns more must have a greater say in how an enterprise is run.
Gandhi warned that the Earth has enough for everyone’s needs, but not for their greed. The agenda of businesses is to make people buy more. Owners of social media platforms have become the richest people in the world by selling more advertising: it is their business model. Advertising fuels greed for more: the latest fashions and latest models of smartphones when the old ones were already fulfilling consumers’ needs.
Alarms are now ringing. Technology and ‘Industry 4.0’ may be going too far too fast. Automation is destroying jobs. If citizens do not have incomes, how will they buy all the stuff and services the robots will produce? The answer seems to be to provide them with a universal basic income. The problem is that corporations and wealthy people are unwilling to pay more taxes to provide governments with funds for the universal basic income.
Gandhi’s solution to the distribution of wealth was that workers should be owners of their enterprises, even if they were tiny ones, so that they would retain wealth from their work, and not have to pass it on, as ‘profits from the bottom of the pyramid’, to remote investors. Therefore, Gandhi advocated village industries, of the butcher, the baker, and the candlestick maker, who, by buying and selling from each other would make local economies grow, and people’s incomes grow, as indeed did Adam Smith, the father of capitalism.
Gandhi is universally known for his advocacy of non-violence against others, even oppressors, and non-violence against nature. Gandhi was also an untiring advocate for reform of business and social institutions to free people from political, social, and economic oppressions.
The jet-setters assembling in the WEF in Davos and in the Ritz-Carlton in Riyadh, who are shaping the business landscape, would do well to recall Gandhi’s advice on how business institutions must be reformed to make the world better for everyone, not just for themselves.
Powerful corporations are misusing the atmosphere and water resources, that belong to everyone, to feed their production processes and to dump their wastes. They can get away with this, as Al Gore another champion of nature pointed in Davos, because under the law corporations are considered to be persons with the rights to use their property as they will.
He explained how, with the US Supreme Court taking the view that ‘money is speech’, corporations and their wealthy owners have much greater clout in the political process than less endowed citizens can have. Tragically, Gore said, large corporations use their financial clout to influence public policies in their favour. They advocate for lower taxes and subsidies for corporations. They even debunk the evidence of climate change.
Using the wealth of their businesses to pay for their own high-flying lifestyles, and by using their wealth to shape a business landscape that enables them to make even more wealth for themselves, they certainly do not behave like trustees of the communities’ resources.
Oxfam reported in Davos that wealth inequalities have increased even further in 2018. A portion of the wealth of the eight wealthiest persons in the world can provide for the education of all the poor children in the world deprived of a good education and, therefore, equal opportunities in life.
Gandhi had provided a talisman. He said, to test whether a policy was a good one, the policymaker should consider its benefit for the poorest person at the fringes of society and the economy. Sadly, such people are not invited to discussions in Davos and the Ritz Carlton where business leaders and their advisors are designing the business landscape. Their voices are not heard. Gandhi spoke for them.
The writer is a former member of the Planning Commission and author. (Through The Billion Press.)