The Slow Death of Neo-Liberalism But is Anyone in India Listening?

Image: The Gaurdian​

It took an article from the iconic Guardian in Britain dated almost a month ago (May 31) authored by the redoubtable Aditya Chakrabortty, You’re witnessing the death of neoliberalism – from within to give a more honest and realistic appraisal of the fundamental upheavals and damages caused by a policy framework, ruthlessly pushed, undemocratically secured that has reduced, effectively every yardstick as measureable to, or against the market. Even within the world’s democracies.
 

Today, July 1, 2016, Indian newspapers are replete with eulogies to this market driven policy framework that has hollowed out both world and Indian institutions, whereas the UK-based Chakrabortty says, the yardstick of the National health Service and the universities say it all, “classrooms are being transformed into supermarkets”. "In this way, the public sector is replaced by private companies, and democracy is supplanted by mere competition," he adds. Nowhere could a reflection of what is happening within India, or has already happened, so readily be found.

Over the past few years most acutely, and over the past decade more insidiously, this framework has been critiqued widely by some Indian academics, journalists and activists. Nowhere is it more evident than the direct assault on Indian farming—visible in the callous loss of life among our farmers, the education and health sectors. Kanhaiya Kumar now an iconic household name thanks to the peculiar brand of proto-fascist authoritarianism of the Modi regime, flagged the issue emotively and sensitively when he demanded, in true democratic tradition, a common system of education, a common school system for all Indian children.
​
Indian Journalism was the first to fall prey to the market-driven neo-liberal framework. We were all at the middle to senior levels within respected publications when the lure of ‘contract’ jobs, at two or three times the average rates then paid to us who were ‘secure’ lower salaries but savings like provident fund etc. Most succumbed, membership to the journalists unions and federations dwindled, and died.

Those who signed up to the contract got caught up and into a new and glitzy world, where cars and a high executive club life styles, unheard of for the classic Indian journalists, suddenly became open, and possible. This capture of the media by the market – a leading proprietor of one of India’s newspapers famously said, “News and Views are what appears between the advertisement pages”—is today witness to, not just a dumbing down of institutions and content, but has been accompanied by a visible loss of integrity, and independence. [1]

Image: The Gaurdian​​

In both education and health, the state and government’s surrender to the market essentially has meant that only the rich get access because they can pay. Today the source of ferment and dissent in all Central universities –be it the Hyderabad Central University, Jawaharlal Nehru University (JNU), Allahabad University, Doon University, Assam University and many others –is the significant budgetary cuts in central government (UGC) scholarships that ensure democratic access to students from rural and marginalised backgrounds (and this includes OBCs, minorities and Dalits). This regime today—in more crude continuance of earlier policies– wants to be the last bastion of a policy worldview that is being seriously questioned yes, even by the Indian Monetary Fund.

The initial resistance to policies like the rural work programme (MGNREGA) by the Modi regime has been followed up with what is happening presently: the direct assault on the statutory rights of tribals and other peoples living on and off forest lands. This is being achieved and ensured through executive overreach initiated by the central environment ministry. These policy moves, including the latest one of disempowering the grasroot Panchayati Raj (village level democratising) framework are evidence that India, at least, has not yet shrugged off a framework that the first/developing world thrust upon us and is today, somewhat, questioning.

The crux of the critical article in The Guardian is that it draws attention to three or four documents emanating from, the heart and soul of neo liberalism –the International Monetary Fund (IMF)—that today, in June 2016 point to its far from many successes. Chakkroborty calls it’s the “remarkable breach of the neoliberal consensus by the IMF.”

Read this paper by Jonathan D. Ostry, Prakash Loungani, and Davide Furceri

This paper concludes by saying “Instead of delivering growth, some neoliberal policies have increased inequality, in turn jeopardizing durable expansion:
‘However, there are aspects of the neoliberal agenda that have not delivered as expected. Our assessment of the agenda is confined to the effects of two policies: removing restrictions on the movement of capital across a country’s borders (so-called capital account liberalization); and fiscal consolidation, sometimes called “austerity,” which is shorthand for policies to reduce fiscal deficits and debt levels. An assessment of these specific policies (rather than the broad neoliberal agenda) reaches three disquieting conclusions:

• The benefits in terms of increased growth seem fairly difficult to establish when looking at a broad group of countries.­
• The costs in terms of increased inequality are prominent. Such costs epitomize the trade-off between the growth and equity effects of some aspects of the neoliberal agenda.­
• Increased inequality in turn hurts the level and sustainability of growth. Even if growth is the sole or main purpose of the neoliberal agenda, advocates of that agenda still need to pay attention to the distributional effects.­

What makes the fund’s intervention so remarkable is not what is being said – but who is saying it and just how bluntly. In the IMF’s flagship publication, three of its top economists have written an essay titled “Neoliberalism: Oversold?”.

There is more from where this comes. It is not just the IMF but also the Bank of England’s Mark Carney who is sounding the alarm. He speaks, in this speech delivered in February 2016  about “a low-growth, low-inflation, low-interest-rate equilibrium”. Then there is the Bank of International Settlements, the central bank’s central bank, that warns that “the global economy seems unable to return to sustainable and balanced growth”.

The IMF. World Bankers. Economists from within the Spectrum.  When will we in India, make our own independent and informed assessment that is already showing up in increasing dismepowerment, starvation and poverty all around?