WHY LEFT?

Prabhat Patnaik

INDIA has witnessed a veritable social transformation in the twentieth century. A society characterised for millennia by institutionalised inequality in its most grotesque forms, such as “untouchability” and “unseeability”, has made a transition to juridical equality, a set of fundamental rights for all citizens, and a form of government based on parliamentary democracy with universal adult franchise. The significance of this transition, despite the fact that it still falls far short of authentic equality, cannot be overstated. It constitutes a part of our long democratic revolution.

This revolution is the outcome of a massive and historically unprecedented popular upsurge that occurred in this country in the twentieth century. The upsurge had diverse manifestations, from the social movements led by Periyar and Ambedkar to the grand political struggle against colonialism. True, the leaders of the anti-caste social struggle might not have involved themselves in the anti-colonial struggle, and several leaders in the latter struggle might have had scant sympathy for the anti-caste struggle, but at the level of the oppressed there was enthusiastic participation in both these struggles, which they rightly saw as interlinked. And the sweep of the anti-colonial struggle could acquire the necessary width only when it included in its agenda all the features, marking an end to institutionalised inequality, mentioned earlier, which in turn were duly enshrined in the constitution of independent India. This upsurge was greatly influenced by the Bolshevik Revolution, and some of the most dedicated and committed activists within it, upon whom the epic saga of the emergence of the Soviet Union had made an indelible impact, came together to constitute the Left.

CARRY FORWARD DEMOCRATIC REVOLUTION

This democratic revolution needs to be carried forward, for if it is not, then there will be an inevitable slide-back. Revolutions do not stand still; they either move forward or are overwhelmed by counter-revolutions. The Indian democratic revolution today is faced with the prospects of being so overwhelmed: counterrevolution is gathering strength, and the main reason for this lies in the shift in the position of the bourgeoisie.

The fact that the old social forces, the custodians of the old order embodying institutionalised inequality, were not dealt decisive blows is well-known. Their stranglehold over land, which was the key to their economic, and hence social strength, was not sufficiently loosened. Of course, even if it had been, the destruction of the old order would still have been a protracted and arduous affair; but in its absence, the strength of the counterrevolutionary possibilities remained unimpaired. In addition however, the bourgeoisie which managed to retain its leadership over the anti-colonial struggle, carried its compromise with imperialism several steps forward when it adopted a neo-liberal agenda in the place of the old dirigisme that had been the legacy of the anti-colonial struggle. The consequence of this has been to produce within a very short span of time a deep hiatus within the Indian economy between two groups: a small group of financial and corporate magnates and the middle class professionals around them, who have enriched themselves immensely, and the vast mass of working people, viz workers, peasants, petty producers, agricultural labourers, craftsmen, and all those working in the informal sector, who have witnessed growing absolute immiserisation.

This hiatus itself, which follows inevitably from the attempt of the big bourgeoisie to consolidate capitalist development in the country, no longer in relative autonomy vis-a-vis imperialism but instead through closer integration with international finance capital, is fundamentally anti-democratic. In addition however the effort to “accommodate” this hiatus within the structures of the democratic institutions that were erected through the constitution, necessarily leads to a rolling back or attenuation of these structures, ie, to a counter-revolution against the long democratic revolution experienced in India.

The onslaught on the democratic revolution in short comes not only from the old reactionary forces that were a part of the old order, but from the powerful and acquisitive class of “modern” big bourgeoisie that unleashes a process of primitive accumulation of capital, strives for a strategic alliance with imperialism to buttress its position, and attempts a rolling back of the democratic rights of the people so that their opposition to such primitive accumulation is enfeebled. To say this is not to suggest that the bourgeoisie prior to “liberalisation” did not attempt to reduce the democratic rights of the people; it did, as the infamous “Emergency” showed, but such attempts now acquire a systematic and urgent character when the hiatus within society has become immeasurably wider.

How, it is worth asking, does the big bourgeoisie manage to impose upon society such massive increases in inequality, even though the people enjoy formal democratic rights? What in other words are the mechanisms of abridgement of democracy that permit such inequalities? The range of such mechanisms is wide; some of them are well-known; and all of them are clearly visible. A formal abridgement of democracy is the obvious first option. Indira Gandhi during the Emergency actually succeeded for a brief period in doing this, but eventually came a cropper. The BJP-led NDA during its attempt to “revise” the constitution sought to institutionalise such an abridgement, but that attempt too failed. Even so, however, thanks to a plethora of measures, often initiated by the judiciary, like bans on bandhs, restrictions on the right to strike, and curbs on public meetings, there has been a whittling down of people’s democratic rights.

The second obvious mechanism is the nurturing of communal-fascism, which, as Kalecki put it, is kept like a “dog on a leash”. It is occasionally unleashed, with devastating impact; and, even when it is leashed, the fear of its being unleashed serves to reconcile people to the neo-liberal measures of a non-communal-fascist bourgeois government. Since unemployment and distress provide fertile ground for fascist tendencies, this is a mechanism that neo-liberalism spontaneously generates for itself.

The third mechanism is to “incorporate” dissent, and to criminalise such dissent that cannot be “incorporated”. Here the very fact of the economy being open to the vortex of financial flows helps the neo-liberal cause: any attempt to pursue policies different from what international finance capital favours is fraught with the danger of capital flight, and this forces a degree of uniformity in policy-making among all political formations that do not have the courage to go beyond the existing arrangements altogether. Ideologically too, slogans like “keep development above politics” which is a euphemism for “let us unite to endorse neo-liberalism”, and “let us endorse primitive accumulation of capital”, play the role of “incorporating dissent”. Refusal to be so “incorporated” on the other hand brings the charge of sabotaging “the nation’s prospects of emerging as a super-power” and hence being “anti-national”. Through a myriad means in other words, involving in particular the use of corporate media, a propaganda barrage is unleashed that identifies the interests of the corporate and financial magnates as the “nation’s interest”.

The fourth is the spread of religiosity and the resurgence of pre-modern authoritarian institutions like khap panchayats which the bourgeois political formations treat with benignity. No doubt, an individual has a right to pursue any religion in his or her private life; but religiosity which entails the intrusion of religious practices and rituals into public life, serves to depoliticise and disunite people.

DEPOLITICISING PEOPLE

Indeed the essence of the project of the big bourgeoisie is to depoliticise and disunite people, convert them into atomised empirical entities, rob them effectively of any subject role, and enfeeble them in the matter of defending their democratic rights. The uniqueness of the Left consists in the fact that it is opposed to all this, that its agenda on the contrary is to unite and politicise the people which alone can make them capable of defending their democratic rights. The Left in short is the only consistent force that works in the direction of carrying forward the long democratic revolution in our country.

The fact that the Left is consistent in its fight against the counter-revolution that seeks to overwhelm the democratic revolution, the fact that it is consistent in carrying forward the democratic revolution, follows not from any particular “good qualities” of the Left, or from its being particularly “well-meaning”. It follows from its very theoretical premises. All political formations which lack the courage to visualise going beyond the boundaries of capitalism, have willy-nilly got to become complicit in the project of the big bourgeoisie to depoliticise the people, to rob them of their democratic rights, and to unleash a counter-revolution against the long democratic revolution; some of them may resist some particular measures but ultimately their resistance against this project must crumble before the logic of capitalist development which necessarily requires an enfeeblement of the subject role of the people.

The Left is different from all of them because it can visualise going beyond the boundaries of capitalism. It can be consistently democratic because it is not imprisoned within the antagonism between capitalism, dominated by globalised finance, on the one hand, and authentic democracy on the other. It is prepared to resolve this antagonism by going beyond capitalism, which is why it can be consistently democratic.

The Left in India, notwithstanding its many mistakes, has consistently stood for the carrying forward of the democratic revolution; for further abrogating, systematically, the millennia-old institutionalised inequality of our old order; for struggling against the hegemony of international finance capital and the deep hiatus that a regime characterised by such hegemony produces; for struggling against communal-fascism; for resisting all attempts to curb the democratic rights of the people in the name of “order”, “combating chaos and anarchy” and “development”(to the point of even issuing public rebukes to senior leaders whose remarks could be interpreted otherwise); and for overcoming religiosity and separateness through political praxis.

Any weakening of the Left weakens the democratic revolution in our country and hence our march to “modernity”. India’s march to “modernity” requires not 8,9,10, or 11 per cent growth rate; it requires a carrying forward of the democratic revolution. This is the touchstone by which all political formations have to be judged, and on this criterion the Left, notwithstanding all its weaknesses, emerges superior to all other political formations.

The opposition to the Left alas has now gathered momentum to a point where many, claiming to be “progressive”, use the very arguments mentioned above to attack the Left. I can hear for instance an immediate riposte to what I have said above: what about Singur, what about Nandigram?

Much has been written about Singur and Nandigram, and we need not go over all that here. Let us for argument’s sake accept the account of the events put forward by the opponents of the Left. Even so, nobody can possibly argue that they reflected the Left’s subscription to an abridgement of the regime of rights of the people. However mistaken one may think the handling of those two cases by the Left Front government was, one cannot say that they represented an attempt by the Left to dilute or abrogate the regime of democratic rights of the people. Of course, any police firing can be interpreted ipso facto, whether rightly or wrongly, as constituting an attack on the democratic rights of the people; but there is a difference between an episode of police firing and a change in stand on the regime of rights. The Left has never changed its basic class position on the regime of democratic rights of the people. It has stood consistently against all attempts to abridge the regime of rights (to a point where it even opposed the banning of the Maoists despite their rampant murderous attacks on CPI(M) cadres). Nandigram and Singur in short were tragic episodes; they do not represent an iota of shift on the part of the Left to any alternative, abridged, regime of rights.

Likewise one often comes across the following argument: elections in West Bengal, indeed politics in West Bengal, is characterised by violence; since all parties resort to poll violence, a shift from an entrenched political formation like the CPI(M)-led Left Front to a new one led by the TMC, that will take time to consolidate its position, will amount to an empowerment of the people in the interim.

I shall give just one statistic against this “all are the same” argument. During Left rule in West Bengal there have been numerous occasions when the Left has lost heavily: in the Lok Sabha elections after Indira Gandhi’s assassination (even though it did not lose in a majority of the seats), in the recent Lok Sabha elections and of course in the recent panchayat elections. Its alleged muscle power and violent proclivities did not prevent its opponents from making serious inroads into its bastions on several occasions. But on one occasion when after Geeta Mukherji’s death, Gurudas Dasgupta was contesting from Panshkura Lok Sabha seat, he lost the election because in Kespur, which had been “liberated” from the Left by its opponents, he got two votes out of the 25000 polled! To say that “all are the same”, that the Left uses violence to prevent free elections, just as the others do, is a travesty of the truth.

All this has a vital importance in the current election season. The outcome of these polls will have a crucial bearing upon the future of the Left in India. And if the Left receives a setback then the democratic revolution in our country will be in jeopardy.

The inflation conundrum

by C. P. Chandrasekhar

To the surprise of the UPA government, inflation just refuses to go away. Almost a year ago, when addressing a Chief Minister’s conference on food prices early in February 2010, Prime Minister Manmohan Singh declared: “The worst is over as far as food inflation is concerned. I am confident that we will soon be able to stabilise food prices.” Three months later, on more than one occasion, government spokespersons, like Chief Economic Advisor Kaushik Basu, declared that inflation had “peaked out” and was on a downward trend. Such statements are not surprising since in the current dispensation government representatives at the highest level are expected to talk down prices and talk up markets. It is not what you say but the confidence with which you say it that matters.

But there is reason to believe that the government did actually believe that prices would follow some sort of a cycle, and are more likely to rise slowly than at a rapid pace. One or two predictions of an impending decline are understandable. But, over the last year, almost every month or even week, one official spokesperson or the other (be it the Finance Minister, the Finance Secretary, the Deputy Chairman of the Planning Commission or the ubiquitous head of the PM’s Economic Advisory Council) declared that inflation is bound to moderate, in a voice tinged with surprise that it has not done so earlier.

This expectation came from a particular reading of the situation. Whenever prices did rise rapidly, it was attributed either to supply side factors such as a poor crop or to unavoidable factors like the “base effect”. Thus when the PM spoke in February last year he looked forward to a good monsoon and a better crop. And, if prices had been unusually low a year earlier, even a return to “normalcy” would reflect a high rate of inflation that must be discounted. Occasionally, of course, there was talk of hoarding and speculation, but only on the part of unscrupulous traders, who were exploiting temporary demand-supply imbalances.

Experience has shown that these “beliefs” were patently false. Despite the fact that the monsoon has been much better in recent seasons, the month-on-month inflation rate as reflected even by the Wholesale Price Index, which stood at a disconcertingly high level in the first half of 2008, and then declined consistently between July 2008 and July 2009, accelerated subsequently and has remained at high levels throughout 2010. And weekly WPI movements are an indication this is likely to be true in January 2011 as well.

There are a number of features of this inflation scenario. The first is that, while it is not restricted to food alone, it has been substantially driven by food articles, which are more prone to speculative influences. Even when demand-supply imbalances are minor or absent, speculation can push up prices. The second is that within food articles, inflation has at different points in time affected different commodities, such as cereals, pulses, vegetables, eggs, meat and milk. Not all of these commodities are equally weather dependent and the prices of some are influenced by where administered prices are set. To attribute the trends in their prices solely to demand-supply imbalances or imported inflation is to avoid the conundrum. Third, when inflation does occur in some food items, be they onions, vegetables or even cereals, the rate of inflation tends to be extremely high, pointing to the role of speculation in driving prices in the short run. Finally, even when such influences are not at work there seem to be factors operative that keep the “all commodities” inflation rate high.

Even though it is still early to say, the trend over the last one-and-a-half years suggest that there are structural factors at work that are setting a higher floor to the inflation rate. They may be neutralised in the future. But even if they are, they could as well return to play a role subsequently. The government has recognised this structural, inflationary tendency in a peculiar, in fact patently absurd, way. It attributes the inflation to the demand-side effects of high growth. If people are richer because of an 8-9 per cent growth rate, they are bound to demand more. Since supply does not adjust, prices are bound to rise.

There are many assumptions here. That when GDP grows, those who need to buy and consume more cereals, pulses and vegetables garner a reasonable share of the benefits of that growth. Or that when GDP grows, the growth does not occur in large measure in the commodity producing sectors, or even if it does this happens only with a significant lag. That even though the “high growth” era began in 2004, it is only now that it has generated demand-supply imbalances. And, that if there is indeed a supply-demand imbalance the government is constrained, for whatever reason, to redress it by resorting to imports. Making such assumptions is not just wishful thinking, but avoiding the conundrum.

It is not that there are no demand-supply imbalances. India’s growth has indeed been lopsided. As has been argued by perceptive analysts, India’s high GDP growth was recorded in a period when the agricultural sector and a range of petty producers were experiencing a crisis, an aspect of which was the non-viability of crop production and therefore an extremely slow growth of agricultural output and GDP. At some point that long-term crisis, was likely to result in an unsustainable demand-supply imbalance.

But there are two other factors that are structurally embedded in the economic environment generated by the government’s neoliberal reform agenda adopted for two decades now. The first is a tendency where corporate consolidation in production and trade, decontrol that permits profiteering, a reduced role for public agencies and public sector firms and the withdrawal or curtailments of subsidies on a range of inputs, has pushed up costs and prices (including administered prices) substantially. As some have argued, India is increasingly a high input price and high output price economy, with a rising floor for many prices. The second is the role that speculation has to come to play, with liberalised trade, with the presence of large corporate players in the wholesale and retail trade and with the growing role of futures and derivatives trading in a host of commodities. Add the influence of these two factors to the underlying crisis in some commodity producing sectors and the long-term, structural inflation is more than partly explained.

The government of course does not consider these angles worth pursuing. The reason is partly ideological. It cannot bear questioning the outcome of reform. It cannot bear suggesting that corporate entry can lead to profiteering in a context of decontrol. It does not believe that speculation in futures markets can push up spot prices, and has banned some of these markets only because of public pressure. It cannot contemplate a larger role for the state and no role for corporate (domestic and foreign) players in the both wholesale and retail trade. In the event, all that the Prime Minister’s emergency meetings on the inflation issue could throw up is an inter-Ministerial group mandated to monitor short-term fire-fighting measures and promote actions that the government has claimed to be promoting for many years now.

What is more, in the midst of all this, on the basis of the liberalised pricing mechanism, the oil companies have been allowed to hike the prices of petrol a second time in quick succession. Given the role of public sector firms here, nobody would believe that a nod from the government was not obtained before the hike. If balance has to be maintained a diesel hike must follow. This government may go in for that as well. Doing this to the prices of what are universal intermediates in the midst of an inflation emergency might be seen by some as madness. If the belief that the people can be called upon to sacrifice real incomes because reform cannot be held back or reversed is a sign of madness, then possibly it is.

Growth and Impoverishment

By: Prabhat Patnaik

NOT a day passes without some official spokesman or the other recounting India’s high growth performance and promising to better it in future. The rate of growth of gross domestic product has got elevated to being the sole criterion for judging the country’s economic achievement. True, large masses are still afflicted by poverty, malnutrition and abysmal living conditions, but that, the official argument states, is only because the fruits of this growth have been unevenly distributed; if the rate of growth is further increased, and if a better spread of its beneficial effects is ensured, then these problems will disappear. About the beneficial effects of GDP growth, however, they scarcely have any doubt.

WRONG PERCEPTION

This perception which has many adherents is plain wrong. There can be alternative ways of achieving economic growth, and the social impact of growth depends upon how it is achieved. The growth process currently underway in the Indian economy, which is rooted in India’s neo-liberal policy dispensation, is necessarily of a kind that impoverishes in absolute terms the bulk of the working population. Its celebration is unwarranted. An acceleration in the rate of this growth, as long as its nature remains unchanged, will only further increase the degree of absolute impoverishment. And, given the nature of the current growth process, ie, within the overall ambit of neo-liberalism, efforts to make this growth “inclusive” through various measures of “social protection”, such as the NREGS, will be necessarily limited, transitory, and, at best, restrictive of the pace of absolute impoverishment without reversing it.

I am not resorting to hyperbole. The empirical evidence for absolute impoverishment in the recent period of high growth is overwhelming; and the reason for it is also fairly straightforward. Let us look at the evidence first. The official criterion for the identification of poverty (until it was changed recently after the Tendulkar Committee report) has been the intake of 2400 calories or less per person per day in rural India and 2100 calories or less in urban India. By this criterion, poverty has certainly increased: direct measurement of calorie intake suggests that 74.5 per cent of the rural population was “poor” in 1993-4, and 87 per cent in 2004-5; the corresponding figures were 56 per cent and 63 per cent respectively for the urban population. (These figures, based on NSS data, are from Utsa Patnaik, Economic and Political Weekly, Jan 28-Feb 4, 2010, and their veracity cannot be questioned).

Foodgrain absorption figures confirm this conclusion. Per capita foodgrain absorption (defined as net output minus net exports minus net increase in stocks) which, in round figures, was 200 kilograms per annum in “British India” at the beginning of the twentieth century declined drastically to less than 150 kilograms by the time of independence. Strenuous efforts by successive governments in independent India raised it to 180 kilograms by the end of the eighties; but there has been a decline thereafter, marginal at first but precipitous after the late nineties, so much so that per capita foodgrain absorption in 2008, at 154 kilograms by FAO estimates, was lower than in any year after 1953. The period of high growth is precisely the one associated with reduction in foodgrain absorption, and hence with significant absolute impoverishment.

Two arguments are typically advanced against the identification of reduced foodgrain intake with increased poverty. The first states that there tends to be a diversification of consumption away from foodgrains as incomes increase, so that reduced foodgrain intake signifies, contrary to my claim, a qualitative improvement in the consumption basket, and hence in living standards.

This argument however is wrong. With increased incomes, the direct consumption of foodgrains may go down, but the indirect consumption of foodgrains, as processed food (such as cornflakes) or as feedgrains for animal products (such as mutton, pork, chicken etc) goes up; as a result the total absorption of foodgrain per capita, direct and indirect taken together, increases. In the US for example the per capita total absorption, direct plus indirect, of foodgrains is 900 kilograms per annum compared to India’s 154 kilograms. In fact, comparison across countries shows that almost 55 per cent of the observed difference in per capita total foodgrain absorption is “explained” (statistically) by per capita real income difference. Hence reduced foodgrain absorption is indicative of large-scale absolute impoverishment.

The second argument states that the reason for reduced foodgrain intake even among lower income groups is larger expenditure on other things, in particular healthcare; and this is indicative of changing “tastes”, associated with an improved quality of life, and hence economic betterment.

The fallacy of this argument lies in its underlying assumption that anyone, even a poor man, compares at the margin the satisfaction to be derived from consuming more food with that from taking his child to the hospital when the child is ill. This assumption is wrong. In most people’s perception the latter has absolute priority. Since this perception could not have emerged suddenly over the last decade, when per capita foodgrain absorption declined precipitously, the cause for this decline is likely to be a rise in healthcare costs over this period.

Such a rise has certainly been a feature of the neo-liberal era, owing to increasing drug prices and privatisation of healthcare. Hence, the fact that expenditure on healthcare has gone up even at the expense of food intake in the last decade, can only be indicative of impoverishment, rather than of an improved quality of life.

DECLINING PURCHASING POWER

The basic reason for this impoverishment is reduced purchasing power in real terms in the hands of the bulk of the working population, which in turn is due to two phenomena. First, the growth process has been accompanied by what Marx had called a process of “primitive accumulation of capital”, whereby vast numbers of peasants, petty producers like fishermen and craftsmen, marginal groups like the tribal population, suffer either outright dispossession or a squeeze on their real incomes, for the benefit of large capitalists, speculators and the financial interests.

Big retail chains come up to displace petty traders; agribusiness comes in to squeeze the peasantry; land grabbing financiers come in to displace peasants from their land for real estate and spurious infrastructure projects; tribal people are evicted to make room for mining projects; and petty producers of all descriptions everywhere get trapped between rising input prices caused by the withdrawal of State subsidies and declining output prices caused by the withdrawal of State protection from world commodity price trends. When we add to all this the rise in the cost of living, because of the privatisation of education, health and several essential services, which affects the entire working population, we can gauge the virulence of the primitive accumation that is unleashed.

This process of primitive accumulation is at the same time unaccompanied by any significant increase in the employment of wage workers (as distinct from white collar professionals) in the capitalist sector. This is because of the rapid rate of technological and structural change that a changing demand pattern, owing to rising income disparities, generates in a “liberalised” economy. Hence the victims of primitive accumulation cannot get absorbed as wage-workers under capitalism. They either join the reserve army of labour, or linger on in their old occupations, taking a cut in their real incomes in both cases. Besides, this very fact of a swelling labour reserve also keeps the wages of employed workers low, even as labour productivity rises, contributing further to the growing income disparities.

Any acceleration of growth simply reproduces the problem on an even larger scale. The displacement of tribals and peasants occurs on an even larger scale, the expropriation of petty producers occurs to an even greater extent, while the rate of growth of labour productivity in the organised capitalist sector increases with increased growth rate, keeping labour absorption into this sector as constricted as ever. The view that with a higher growth rate poverty will be eradicated remains a chimera; poverty on the contrary only increases with the growth rate.

And the constraint on public expenditure, typical of neo-liberal economies, where tax concessions reduce revenue and “fiscal responsibility” legislation curbs government borrowing, ensures that “social protection” measures remain both anaemic and amenable to sudden, arbitrary and sporadic cuts. Growth under the neo-liberal dispensation therefore, far from being a condition for the amelioration of poverty, becomes an instrument for the impoverishment of large segments of the working population.

Arjun Sengupta: A Tribute

By: Prabhat Patnaik
Vol XLV No.42 October 16, 2010

Arjun Sengupta, the economist who held many positions in academics, government and international organisations, and was chairman of the National Commission for Enterprises in the Unorganised Sector died on 26 September. Two tributes, the first by a fellow economist who was Sengupta’s student in the mid-1960s and the second by a more recent younger colleague, who worked with him in the last decade of his life.

A rjun Sengupta led such a varied life, played so many different roles, that it is as if there was not one but several different Arjun Senguptas. Each person who knew him knew only one of the Arjun Senguptas, but had little idea about the others.

I, for one, knew little about the Arjun Sengupta who was an economic adviser to Indira Gandhi, or the Arjun Sengupta who advised International Monetary Fund Managing Director Jacque de Larosiere, or the Arjun Sengupta who was a member-secretary of the Planning Commission. But I did know the Arjun Sengupta who was my teacher at the Delhi School of Economics and who took upon himself the role of acting like a bod-da (elder brother) to me, invariably bantering, and often giving me gratuitous advice about what I should do with my life, which was generally infuriating but always affectionate. (On one occasion when I was a junior faculty member at Cambridge, and like others of my generation dreamt of the revolution, he visited me, and to my intense fury, advised me not to waste my life on “all this radical stuff”.) Whenever we met, after a lapse of months or years, he would pick up this role from where he had left it, no matter what he or I had been doing in the interim.

At the Delhi School

It was in the mid-1960s that Arjun first appeared at the coffee house of the Delhi School of Economics, a handsome young Bengali economist with a fresh MIT PhD who had just joined the Institute of Economic Growth. Those were the days when all Bengali economists were of the Left, the only question being whether they were with the Left Communists (CPI(M)) or the Right Communists (CPI). Delhi School student gossip made Arjun out to be a Right Communist. Within a short time he joined the Delhi School faculty and started teaching us Growth Theory.

He was full of fun in the class, full of jokes, absolutely without any airs and highly approachable. Professors Sen, Chakravarty and Raj, despite their best intentions, were quite forbidding; so we naturally warmed to Arjun, one of whose many stories in the class was about how in an examination hall, the entry of some pigeons had provided him and his classmates the opportunity to take recourse to means, not altogether “fair”, to answer a particularly difficult question paper.

Around that time Arjun Sengupta produced a major paper on the impact of foreign aid, which was published, I think, in the Oxford Economic Papers. To the batch which immediately followed mine and which included Utsa (Mukherji, later Patnaik), Deepak (Nayyar) and Isher (Judge, later Ahluwalia), he taught the International Economics option. But shortly afterwards he left the Delhi School to join the faculty of the London School of Economics, which is when I lost touch with him, apart from his visit to Cambridge mentioned earlier.

Explaining the 1970s Crisis

We met up again after I had returned to India to join the Centre for Economic Studies and Planning at the Jawaharlal Nehru University, by which time he too had returned to a series of important positions in the Government of India, but our contacts were infrequent. It was in the late 1970s that he produced his excellent paper (written perhaps when he was at the IMF) on the world capitalist crisis of the mid-1970s. The argument of the paper was simple but incisive: since the oil-price hike transferred purchasing power primarily from the consumers in the advanced capitalist world to the oil-producing countries, which held a large portion of their increased oil revenue in the form of bank deposits, it entailed a reduction in world demand, in particular aggregate demand in the advanced capitalist countries. To counter this, it was necessary that the governments in the advanced capitalist countries should run increased fiscal deficits. But since the oil price hike had given rise to cost-push inflation in these countries, and the governments, in a futile bid to counter this inflation had curtailed their fiscal deficits, they only compounded the contractionary impact of the oil-shock. This explained the mid-1970s crisis in the capitalist world, which, until then had been the worst since the 1930s.

I met him more frequently after he joined the School of International Studies of the JNU. We would meet regularly on evening walks in the JNU campus (on which he would often be accompanied by Jayshree and Mitu) and pause to have long chats. During our chats, bantering as ever, he would make comments, often unflattering, about things I had written, which to my surprise and gratification, he always made a point of reading. I remember writing an obituary on Paul Sweezy in which I had mentioned that Samuelson and Sweezy were Schumpeter’s pet students at Harvard and that Schumpeter was perhaps responsible for the denial of tenure to Sweezy for ideological reasons. Arjun told me during one of our evening chats that Schumpeter had also been responsible for the denial of tenure to Samuelson on grounds having to do not with ideology but anti-Semitism. Samuelson himself however tended to play down Schumpeter’s anti-Semitism, and would perhaps have absolved him of the charge of denying him tenure, though the fact of his leaving Harvard owing to anti-Semitism was never in doubt. But I assume that Arjun, having been in MIT as a PhD student of Robert Solow, would have known something which Samuelson’s loyalty to his old teacher might have prevented him from admitting publicly.

Once he tantalisingly told me that he had some comments to make about a piece I had written in a volume, A World to Win, edited by Prakash Karat, on the Communist Manifesto, and that he was going to make them in a review of the book he was writing for EPW. That review unfortunately never got written, so I never knew what he was going to say. My evening chats with Arjun were always chastening, stimulating and a source of great pleasure for me. And we talked of everything under the sun, from contemporary politics, to gossip about celebrity economists, to common friends. Even after he retired from JNU, the Sengupta family would still come to the JNU campus for its evening walks.

Provocative Arguments

Around this time he started attending seminars organised by International Development Economics Associates (IDEAS), which provided further opportunities for us to meet and discuss things. He was passionately committed to the idea of providing a social safety net for the unorganised workers, which the National Commission for Employment in the Unorganised Sector headed by him had recommended. But being Arjun, provocative, infuriating and contrary as ever, he once argued in an IDEAS meeting for a combination of labour market flexibility and social safety nets, before a group of Left economists, who were as passionately opposed to labour market flexibility as they were committed to a social safety net.

On one occasion when we were both returning from Kolkata to Delhi, Arjun surprised me by suggesting that in India we should settle down to a two-formation polity, a right-of-centre formation consisting of all political forces in favour of neoliberal policies, and a left-of-centre formation consisting of the left parties, progressive civil society organisations, dalit groups, tribal groups, and feminist organisations which would press for a progressive economic agenda. The moral of the story was that the Left political parties should make an effort to build a coalition of the dispossessed to take on the new economic establishment. Since Arjun prided himself on being hard-headed and not given to wishful thinking, I was a little surprised by his prognostication and pointed out its obvious weakness. This lay in my view in the fact that the Bharatiya Janata Party would never tear itself away from the Rashtriya Swayamsevak Sangh to either become or merge itself into a political formation with a mere right-of-centre economic agenda, which meant in turn that the Left would always have to fight on two fronts, anti-communalism and anti-neoliberalism.

But Arjun, I later realised, had in mind something much deeper: he was thinking not merely of political developments in the near future, but of a trajectory of transition from capitalism to socialism. He dwelt on this theme in his P C Joshi memorial lecture delivered at the JNU, and developed it further in a paper “United Front and the Communist Movement” which he posted to me at Thiruvananthapuram for comments on 10 August. Unfortunately the time-lags were such that he passed away before I could give him my comments, but I hope the paper will be published soon. His covering letter throws light on his project:

My dear Prabhat,

The year before last I gave the P C Joshi Memorial Lecture at JNU. The subject matter of that lecture was confined to…the conditions of the Indian economy shortly after independence. On second reading of my lecture I thought I should bring it up to date incorporating the later development of capitalism in India. On that basis I tried to build a general theory of United Front in the modern capitalist economy. The result was this paper.

The essential point of the paper is in a modern capitalist economy with a large number of interest groups...you have a real chance of building (a) United Front with different groups of working class with their different world views. I have tried to show (that) even then, hegemony of the working class is crucial for (a) well-developed social movement…but that would also give us a better chance of building a United Front towards socialist development.

Before I send it to anybody for publication, I thought I will request you at least to look at the points I made seriously and tell me whether my attempt to build a theory of United Front makes some sense. Please write to me giving your views this way or that, so that a public debate can be initiated.

Best regards,
Arjun Sengupta

Arjun’s views will now have to be presented directly to the public at large; the priority of my comments has become irrelevant. But the paper is typically Arjun, original, incisive, novel and not run-of-the-mill.

Meetings with Arjun were always fun because he was never intellectually stodgy, never pedestrian, never predictable, never dull, always sparkling, even if irritating, annoying and infuriating. It is sad to think that a person so full of life, so full of fun, so full of sparkle, so iconoclastic with a twinkle in his eye, has left us forever.