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Home >Opinion >Columns >Capitalism as we know it is ripe for a tectonic shift

Capitalism as we know it is ripe for a tectonic shift

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Photo Hindustan Times

The pandemic has ruined the glorious work of lifting millions of Indians out of poverty

With the lifting of lockdowns, the crowds and chaos are back. Trains from Bihar, Jharkhand and eastern Uttar Pradesh departing for industrial towns and metros are overflowing. Migrant workers eager to return to work are frustrated by the long waiting lists for train tickets.

With the lifting of lockdowns, the crowds and chaos are back. Trains from Bihar, Jharkhand and eastern Uttar Pradesh departing for industrial towns and metros are overflowing. Migrant workers eager to return to work are frustrated by the long waiting lists for train tickets.

Where can these labourers be considered migrants—in the slums and chawls of the metropolises, or in the villages and towns that they call ‘home’? The covid-19 pandemic has not only broken their dreams and exposed them to the harsh reality of the system, but has also buried the concept of ‘gram swaraj’.

Where can these labourers be considered migrants—in the slums and chawls of the metropolises, or in the villages and towns that they call ‘home’? The covid-19 pandemic has not only broken their dreams and exposed them to the harsh reality of the system, but has also buried the concept of ‘gram swaraj’.

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Ideas of reducing economic inequality and creating parity have also proved to be hollow. This is really important in a country where 63 families have more assets than its annual budget, and where the total wealth of only nine people is equal to that of half the country’s population.

Just a few months ago, our politicians were assuring the country that these migrant workers need not return from their villages, and their livelihoods would be taken care of in the villages itself. The central and state governments have provided free rations and some amount of money to about 800 million people, but people need regular work and food. Packed trains and the waiting lines of thousands of people eager to return to the cities show how these promises have failed.

Will their problems end just by getting back to work? Not at all. The pandemic has emptied the pockets of a large number of people. Markets have opened, but the pace of business is sluggish. Production in factories has been disrupted. It is natural to have an impact on employment and the payment of wages. There are predictions that the economy will pick up, but it will take at least three years for the pre-covid situation to return—and everyone knows those days were not great either.

The economy has been deteriorating for several quarters. Few jobs were being created and demand was not picking up as expected. Some fear a long recession. The condition of Indian women has worsened. According to a study by Oxfam, the amount the CEO of a giant company earns in 10 minutes is equal to the annual income of a woman working from home.

If these figures are worrying, there’s more. The World Bank last week said that inequalities will widen due to covid-19, and that about 125 new million people have slipped below the poverty line. This number is for those living daily for less than $1.9. In India, those who spend more than 32 per day are not counted as people living below the poverty line. In the US, those who spend less than $14 a day are considered poor. According to a study by Azim Premji University, 230 million Indians have been driven to poverty due to covid-19. It does not seem that this havoc will end this financial year either.

Since 1990, India had lifted about 300 million people out of poverty—the pandemic has ruined this glorious work. No one knows for sure how long it will take to get over this scourge either. The primary reason is that so far, there has been only one way to stop this contagion—vaccination, and it won’t even reach 80% of the Indian population before December, at least.

It’s clear that countries such as China and the US will recover soon, but dozens of vulnerable countries in Asia, Africa and Eastern Europe will have to struggle for much longer.

These times force us to pause and think because all our economic theories have proved futile. In the past hundred years, we have had two global pandemics, witnessed the fall of the monarchy, the rise of democracy and the capitalism vs socialism debates. Once a bastion of communism, Moscow now houses seven out of the world’s top 100 super-rich.

What did the system of capitalism, for which ballads were sung after the collapse of the Soviet Union, give us in the past three decades? We know the answer by now.

The pandemic has exposed the hollowness of slogans such as global village, Vasudhaiva Kutumbakam and the ideologies of the left and the right. The post-pandemic world will have to change the way of doing things. This had happened after every pandemic and the Great War. The First World War paved the way for the departure of monarchies. The Second World War sparked the Cold War. The fall of the Berlin Wall in the late 1980s paved the way for the collapse of the communist system.

Is the coronavirus pandemic laying the groundwork to change the current face of capitalism?

Shashi Shekhar is editor-in-chief, Hindustan. The views expressed are personal.

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