These days, we often come across the term ‘Modinomics’ in the mass media. Recently, after the Seoul Peace Prize to Prime Minister Modi was announced, the spokesperson of the Ministry of External Affairs Mr. Raveesh Kumar tweeted by saying that Modi received the award for his contribution to high economic growth in India and world through ‘Modinomics’. Even during the 1990s and 2000s, when Dr. Manmohan Singh was ruling the roost as the Finance Minister and later as the Prime Minister, we would often hear the term ‘Manmohanomics’. When people hear such portmanteau words they tend to feel that all these ‘nomics’ are different from each other and they are the original creations of the people with whom the words are associated.
Things, however, are different. All these ‘nomics’ with the names of our politicians as their prefixes are simply the plagiarized versions of the original ‘Reaganomics’. Because president Ronald Reagan was the first leader who implemented the laissez-faire aka trickle-down economics, which resulted in the subjugation of the working class and the conferment of the pre-eminent position on the ultra-rich. But even here if you feel that Reagan himself had formulated the Reaganomics, you are grossly mistaken. The famed Reaganomics was brewed by a set of economists led by Milton Friedman and F. A. Hayek.
Sometime in April 1947 a group of economists led by F. A. Hayek assembled in a Swiss resort and founded a society called Mont Pelerin Society. The economists associated with this think tank opposed the Marxist and Keynesian economics and abhorred any kind of collectivism. Their ideas were later known to be the ‘neo-liberalism’ and the scholars associated with this thinktank went on to become the advisors to the president Reagan and influenced his economic policies. And President Reagan, surrounded by the Wall Street bankers such as Donald Regan, who famously ordered Reagan to ‘speed it up’, generously gave tax cuts to the tycoons even while trimming the social programs and altering the labor laws which led to their subjugation.
When the Washington Consensus was formulated in 1989 by John Williamson, a British economist, he simply summarized the neoliberal prescription made by the Mont Pelerin Society into 10 points. This ten-point program, which gained notoriety as structural adjustment, was peddled as a standard ‘reform package’ for the crisis-ridden third world. The ‘reform’ package is imposed on the developing nations when they approach the World Bank and International Monetary Fund (IMF) for a bailout. The two international financial institutions continue to carry out the neoliberal project with a missionary zeal.
Manmohan and Modi have simply been implementing the neo-liberal prescription, in other words, the trickle-down economics with impunity in the garb of economic ‘reforms’. And therefore, there is nothing original in all these ‘nomics’. The ruling dispensation and the media have popularized these portmanteau terms with a mischievous motive to glorify these politicians with an intention to promote the economic and political interests of the top 1% of the society.
In 1991 Dr. Manmohan Singh accepted the prescription that came as a precondition for a loan from the IMF and implemented it in the country. Modinomics is only a ‘kadak’ version of that toxic brew. It is all part of ‘laissez-faire devil may care’ scheme and its beneficiaries are the top 1% of the society. This scheme puts the tycoons’ ease of doing business first and the people’s ease of living last. Moreover, it considers any social sector spending that is intended to bring about human development as ‘populist’.
Laissez-faire loves economic growth but abhors human development, it loves the ease of doing business but resents ease of living, it likes dazzling physical infrastructure but dislikes social spending, and it advocates trickle down and denounces any eminence to working class. And in a way, it transforms democracy, as the Nobel laureate Joseph Stiglitz rightly stated, into an arrangement that is “of the 1%, by the 1%, for the 1%”.
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Our politicians and their tycoon cronies are very clever. Even while gaming the policies and institutions in a stealthy and insidious manner to serve their narrow self-interest, they don’t forget to use terms such as human development, democracy, and social integration. They say that ‘their growth’ through whatever ‘nomics’ it is, led to the human development, strengthening of democracy and brought about more social integration. Their statements, which are laden with mischievous use of words that are sacred and convey beautiful ideas, are nothing more than cruel jokes played on the lives of the commoners.
It appears that our politicians, who are bereft of any original ideas, are simply imitating the American capitalism by implementing ‘Reaganomics’. If they feel that they can’t do without imitating something American, they had better emulate Franklin D. Roosevelt because the people of India are very much in need of a ‘New Deal’. Therefore, now is the time to replace Modinomics with a New Deal.