- Are we having a better quality products than what we used to have before 30-40 years ?
- Are we having cheaper products of same quality that we used to have before 30-40 years ?
- Is there is an increase in per capita income world wide in most developed and developing countries ?
- Is the current generation more educated than the earlier one ?
I suppose answer to all of the above questions is 'yes'. We have better products at cheaper rates. We are earning more per capita. We are more learned and knowledgeable than ever. All data points of widely tracked indicators suggest that we are living in a better world. Now, answer the following questions:
- Is unemployment among youth rising?
- Has inequality among society being removed?
- Is there a sense of security and safety among present middle class?
Answer to all the above question might be NO. I might sound skeptic. But actually, we are facing a dilemma. We are in the world of economic abundance (prosperity), technological advancement, information explosion and Manufacturing revolution. But yet we have been fighting for solutions to newer problems. Few decades earlier the world was worried about high mortality rates in adults and infants. We were worried about (now curable) diseases like malaria, TB, Cholera etc. We were worried about low levels of literacy rates and low enrollments in higher education. We were concerned about famines, agricultural productivity and plant diseases. We have battled with above problems and effectively overcame them with scientific knowledge and technical advancements. They are now not on priority, if not fully eliminated.
Technology and information dissemination has totally changed the landscape and complexity of global economy. With new emerging world order the problem sets are new and more complex. They cannot be essentially solved by mere technical or scientific advancement. The problems are in fact created by the remedies which have solved our earlier problems. Capitalism has created the inequality among middle class and super rich. In 2010, high-income countries – that accounted for only 16 per cent of the world’s population – were estimated to generate 55 per cent of global income. Low-income countries created just above one per cent of global income even though they contained 72 per cent of global population. On the other hand technology is threatening to destroy jobs instead creating it.
We as a world are globally connected more ever than before. We are in times when growth is believed to be panacea for all ills. Growth is desperately required. For world to have growth, the system which has worked so far is capitalism. Private enterprises have created value and abundance, far beyond imagination through its ability to innovate, evolve, organize and take risk. Value and abundance which has been created is shared with all, but not equally. The services, the technology and the quality generated by efforts of private enterprise has been shared with all but the economic value generated by the same has been cornered by limited people. E.g iPAD offers excellent tablets, technologically superior to any other brands. It is available to all to benefit and enjoy from it. But the profits are limited to owners of company and salaries are paid to employees of apple only.
Again I reiterate, without agenda of economic growth there is no future. We can not afford to discourage entrepreneurship and we can not act spoilsport for capitalism as philosophy. It is the capitalism which has discovered amazing drugs, useful technologies and has made world less risky place. Not for a moment we can afford to neglect the benefits and strength of private enterprises. We have to respect its ruthlessness, its pursuit for efficiency of machines, man & money.
But the same capitalism and private enterprise which has brought us economic prosperity and abundance is causing great divide. Divide among the Haves and Have nots. Divide among super rich and the average middle class. You look around and see where is the satisfaction and peace in middle class families? There is constant struggle to match up to the rising standard of livings. There is constant struggle to save enough to have a peaceful retirement. There is constant struggle to provide quality education to young ones (which is turning prohibitively costly). Because of dynamic environment, changing technologies, rising standard of living (which requires to spend more per capita), we are not yet out of the insecurity faced by middle class in general.
There is silent revolution going on in manufacturing and IT sector. Manufacturing sector is being transformed by advanced robotics and automation. Use of advanced robotics-machines and automation is improving the quality along with increasing productivity. These advancements are displacing human jobs without affecting quality and simultaneously driving down costs too. To see this, you see any episode of “how do they do it” on Discovery Channel. Speed & precision of new age machines and automation is exceptional. Advanced sensors, smart softwares and fast processors are leading these changes. Similarly in IT industry many human jobs at bottom to IT pyramid are threatened to be replaced by automated software which are equipped with learning capabilities and abilities to mimic human behaviors. Just look at SIRI app in iphone and you will realize how it can render millions of IT workers in BPO sector jobless.
Increasing influence of capital in wealth creation, technology displacing human jobs coupled with unprecedented flow of young workforce in economy is going to create acute stress and pronounced inequality. The effects can be far reaching, devastating and hard to imagine. Hence to solve the crisis of inequality and unemployment which is unfolding along with the economic abundance needs an urgent attention of the policy makers before it blows out of proportion and create socio-economic tensions. If we cannot remove inequality and unemployment, we face a risk of rising incidents of terrorism , civil unrests, hatred among countries etc.
Employment brings social security, equality and stability in the country. It cannot come without entrepreneurship and capitalism. The world has tasted bitter fruits of socialism and communalism in past. So not for a moment we can think of a regime dominated by government or by socialism. Similarly though the technology is displacing jobs we should not stop the progress. It will not be in interest of healthy and bright future. So if we cannot shun capitalism and technical progress, how can we reduce inequality and unemployment?
It calls for a new arrangement born out of marriage of capitalism and socialism. It should generate resources using capitalistic ideology but should distribute using social spirit. With the economic abundance created like never before it calls for assuring minimum standard of living to our underprivileged citizens. The averages show per capita GDP has improved world over, but much of the wealth created has been shared by few person at top and the middle class has remained ever struggling with lower disposable incomes. We need to create a security net which will not allow the citizens to fall below acceptable standard of living. It should address needs of the new world in terms of meeting education expenses, health expenses etc. at low cost.
We need to ensure a system wherein the opportunity to have healthy life and an opportunity to learn (quality higher & technical education) are made available to all citizens equally (meritocracy) & affordably. Because in last decade these are the two things which have determined persons capacity to remain gainfully employed. Affordable education and health services will allow even a middle class family to raise their kids with a hope to be a millionaire someday. Without affordable education and healthcare not only the cost of living will be higher but it will keep the poor and lower middle class devoid of benefits of technical progress. Reservation and positive discrimination for selected underprivileged class in health and education has not yielded desired results and hence it has to be offered at very affordable costs to all without discrimination and that too of good quality. Involvement of rich and powerful people in consumption of public services like education and health, should improve its quality.
This move towards really affordable education and healthcare will not only raise minimum standard of living by providing them with more disposable income but will also raise all social indicators like mortality rates, literacy rates. The citizens can live assured that they and their kids will get equal chance to compete. Besides this, if we can ensure these two things (health & education) population will automatically stabilize in next generation, because poverty and illiteracy are key drivers of population growth. This will reduce pressure on employment in future thereafter.
But again, we should keep in mind that Education and Health are not the only two things which will solve our problem, but I am sure that these are the two things without which the problems will never be solved. There is a need to tackle corruption because if unchecked it will encourage crony capitalism. There is need for smoother movement of humans across borders. Because in this globalize world, humans are not able to move as freely as goods & services and hence the economic benefits of globalization are not shared equally among all the nations. But these two areas are of great importance where irrespective of country and ideology, the government should spend higher amounts. Unless and until the citizens in coming times don’t have access to low cost high quality education and healthcare, we can never think of a world living in peace and prosperity, both together. We need to re-imagine the ideologies of capitalism and role of governments to address inequality and unemployment.
- Are we having cheaper products of same quality that we used to have before 30-40 years ?
- Is there is an increase in per capita income world wide in most developed and developing countries ?
- Is the current generation more educated than the earlier one ?
I suppose answer to all of the above questions is 'yes'. We have better products at cheaper rates. We are earning more per capita. We are more learned and knowledgeable than ever. All data points of widely tracked indicators suggest that we are living in a better world. Now, answer the following questions:
- Is unemployment among youth rising?
- Has inequality among society being removed?
- Is there a sense of security and safety among present middle class?
Answer to all the above question might be NO. I might sound skeptic. But actually, we are facing a dilemma. We are in the world of economic abundance (prosperity), technological advancement, information explosion and Manufacturing revolution. But yet we have been fighting for solutions to newer problems. Few decades earlier the world was worried about high mortality rates in adults and infants. We were worried about (now curable) diseases like malaria, TB, Cholera etc. We were worried about low levels of literacy rates and low enrollments in higher education. We were concerned about famines, agricultural productivity and plant diseases. We have battled with above problems and effectively overcame them with scientific knowledge and technical advancements. They are now not on priority, if not fully eliminated.
Technology and information dissemination has totally changed the landscape and complexity of global economy. With new emerging world order the problem sets are new and more complex. They cannot be essentially solved by mere technical or scientific advancement. The problems are in fact created by the remedies which have solved our earlier problems. Capitalism has created the inequality among middle class and super rich. In 2010, high-income countries – that accounted for only 16 per cent of the world’s population – were estimated to generate 55 per cent of global income. Low-income countries created just above one per cent of global income even though they contained 72 per cent of global population. On the other hand technology is threatening to destroy jobs instead creating it.
We as a world are globally connected more ever than before. We are in times when growth is believed to be panacea for all ills. Growth is desperately required. For world to have growth, the system which has worked so far is capitalism. Private enterprises have created value and abundance, far beyond imagination through its ability to innovate, evolve, organize and take risk. Value and abundance which has been created is shared with all, but not equally. The services, the technology and the quality generated by efforts of private enterprise has been shared with all but the economic value generated by the same has been cornered by limited people. E.g iPAD offers excellent tablets, technologically superior to any other brands. It is available to all to benefit and enjoy from it. But the profits are limited to owners of company and salaries are paid to employees of apple only.
Again I reiterate, without agenda of economic growth there is no future. We can not afford to discourage entrepreneurship and we can not act spoilsport for capitalism as philosophy. It is the capitalism which has discovered amazing drugs, useful technologies and has made world less risky place. Not for a moment we can afford to neglect the benefits and strength of private enterprises. We have to respect its ruthlessness, its pursuit for efficiency of machines, man & money.
But the same capitalism and private enterprise which has brought us economic prosperity and abundance is causing great divide. Divide among the Haves and Have nots. Divide among super rich and the average middle class. You look around and see where is the satisfaction and peace in middle class families? There is constant struggle to match up to the rising standard of livings. There is constant struggle to save enough to have a peaceful retirement. There is constant struggle to provide quality education to young ones (which is turning prohibitively costly). Because of dynamic environment, changing technologies, rising standard of living (which requires to spend more per capita), we are not yet out of the insecurity faced by middle class in general.
There is silent revolution going on in manufacturing and IT sector. Manufacturing sector is being transformed by advanced robotics and automation. Use of advanced robotics-machines and automation is improving the quality along with increasing productivity. These advancements are displacing human jobs without affecting quality and simultaneously driving down costs too. To see this, you see any episode of “how do they do it” on Discovery Channel. Speed & precision of new age machines and automation is exceptional. Advanced sensors, smart softwares and fast processors are leading these changes. Similarly in IT industry many human jobs at bottom to IT pyramid are threatened to be replaced by automated software which are equipped with learning capabilities and abilities to mimic human behaviors. Just look at SIRI app in iphone and you will realize how it can render millions of IT workers in BPO sector jobless.
Increasing influence of capital in wealth creation, technology displacing human jobs coupled with unprecedented flow of young workforce in economy is going to create acute stress and pronounced inequality. The effects can be far reaching, devastating and hard to imagine. Hence to solve the crisis of inequality and unemployment which is unfolding along with the economic abundance needs an urgent attention of the policy makers before it blows out of proportion and create socio-economic tensions. If we cannot remove inequality and unemployment, we face a risk of rising incidents of terrorism , civil unrests, hatred among countries etc.
Employment brings social security, equality and stability in the country. It cannot come without entrepreneurship and capitalism. The world has tasted bitter fruits of socialism and communalism in past. So not for a moment we can think of a regime dominated by government or by socialism. Similarly though the technology is displacing jobs we should not stop the progress. It will not be in interest of healthy and bright future. So if we cannot shun capitalism and technical progress, how can we reduce inequality and unemployment?
It calls for a new arrangement born out of marriage of capitalism and socialism. It should generate resources using capitalistic ideology but should distribute using social spirit. With the economic abundance created like never before it calls for assuring minimum standard of living to our underprivileged citizens. The averages show per capita GDP has improved world over, but much of the wealth created has been shared by few person at top and the middle class has remained ever struggling with lower disposable incomes. We need to create a security net which will not allow the citizens to fall below acceptable standard of living. It should address needs of the new world in terms of meeting education expenses, health expenses etc. at low cost.
We need to ensure a system wherein the opportunity to have healthy life and an opportunity to learn (quality higher & technical education) are made available to all citizens equally (meritocracy) & affordably. Because in last decade these are the two things which have determined persons capacity to remain gainfully employed. Affordable education and health services will allow even a middle class family to raise their kids with a hope to be a millionaire someday. Without affordable education and healthcare not only the cost of living will be higher but it will keep the poor and lower middle class devoid of benefits of technical progress. Reservation and positive discrimination for selected underprivileged class in health and education has not yielded desired results and hence it has to be offered at very affordable costs to all without discrimination and that too of good quality. Involvement of rich and powerful people in consumption of public services like education and health, should improve its quality.
This move towards really affordable education and healthcare will not only raise minimum standard of living by providing them with more disposable income but will also raise all social indicators like mortality rates, literacy rates. The citizens can live assured that they and their kids will get equal chance to compete. Besides this, if we can ensure these two things (health & education) population will automatically stabilize in next generation, because poverty and illiteracy are key drivers of population growth. This will reduce pressure on employment in future thereafter.
But again, we should keep in mind that Education and Health are not the only two things which will solve our problem, but I am sure that these are the two things without which the problems will never be solved. There is a need to tackle corruption because if unchecked it will encourage crony capitalism. There is need for smoother movement of humans across borders. Because in this globalize world, humans are not able to move as freely as goods & services and hence the economic benefits of globalization are not shared equally among all the nations. But these two areas are of great importance where irrespective of country and ideology, the government should spend higher amounts. Unless and until the citizens in coming times don’t have access to low cost high quality education and healthcare, we can never think of a world living in peace and prosperity, both together. We need to re-imagine the ideologies of capitalism and role of governments to address inequality and unemployment.