Monday, January 14, 2019

Of Knowledge, Wealth and Human Development


Money is troubling me, as I am not so desirous about money. Motivational leaders and management gurus say one is not bound to achieve what they are not desirous about. Life is all about ‘Get, Set, Go’ or ‘aim and shoot’. The modern world is all about materialistic instinct and hence building a castle on air is impossible and impractical, every dream need to be grounded on a materialistic goal, and goals divided into short term and long term.

In November 2018, I got introduced to the books, “How will Capitalism End?” (2014) by Wolfgang Streeck (which I am still reading) and “A Guide for the Perplexed” (1977) by E. F. Schumacher. Both books are by German economists, but the second one was philosophical. I have some extracts from E. F. Schumacher:
[…] virtually all my ancestors, until a quite recent generation, had been rather pathetic illusionists who conducted their lives on the basis of irrational beliefs and absurd superstitions. [...] Throughout history, enormous amounts of hard-earned wealth were squandered to the honour and glory of imaginary deities - not only by my European forebears, but by all peoples, in all parts of the world, at all times. Everywhere thousands of seemingly healthy men and women subjected themselves to utterly meaningless restrictions, like voluntary fasting; tormented themselves by celibacy; wasted their time on pilgrimages, fantastic rituals, repetitive prayers, and so forth; turning their backs on reality - and some actually still do it even in this enlightened age! - all for nothing, all out of ignorance and stupidity; none of it to be taken seriously today, except of course as museum pieces. […]  Knowledge of the past was considered interesting and occasionally thrilling but of no particular value for learning to cope with the problems of the present.
From Wolfgang Streeck, I would like to quote the following:
Steady growth, sound money and a modicum of social equity, spreading some of the benefits of capitalism to those without capital, were long considered prerequisites for a capitalist political economy to command the legitimacy it needs. [...] There is mounting evidence that increasing inequality may be one of the causes of declining growth, as inequality both impedes improvements in productivity and weakens demand. Low growth, in turn, reinforces inequality by intensifying distributional conflict, making concessions to the poor more costly for the rich, and making the rich insist more than before on strict observance of the ‘Matthew principle’ governing free markets: ‘For unto every one that hath shall be given, and he shall have abundance: but from him that hath not shall be taken even that which he hath.’
Former US President Obama’s Chief Economic Adviser, Larry Summers, on a “surprise” speech (a surprise speech because Larry Summers was considered to be the friend of Wall Street) at Brookings Institution on March 13, 2009 said:
“An abundance of greed and an absence of fear on Wall Street led some to make purchases—not based on the real value of assets, but on the faith that there would be another who would pay more for those assets. At the same time, the government turned a blind eye to these practices and their potential consequences for the economy as a whole. This is how a bubble is born. And in these moments, greed begets greed. The bubble grows. . . . In the past few years, we’ve seen too much greed.”
Yet another quote from E. F Schumacher in his book Small Is Beautiful: Economics as if People Mattered:
Ever-bigger machines, entailing ever-bigger concentrations of economic power and exerting ever-greater violence against the environment, do not represent progress: they are a denial of wisdom. Wisdom demands a new orientation of science and technology towards the organic, the gentle, the nonviolent, the elegant and beautiful.
All the quotes seem to be irrelevant and quite unconnected with what I try to convey through this article. I would like to summarise the above in four statements:
  1. Knowledge is not absolute; with knowledge evolving every moment, the knowledge preserved from the past may be irrelevant or becomes obsolete in the future. 
  2. Knowledge invented money; and the money created inequality and therefore the rich grow richer and poor falls into poverty.
  3. Money accumulates wealth; wealth breeds greed.
  4. Knowledge and money together proposes development and progress; development is directly proportional to depletion of natural resources which could never be replenished with the human invented economic system. 
For the world, India is a potential market, with its huge population and with widened inequality. The five systemic disorders of advanced capitalism mentioned by Wolfgang Streeck “stagnation, oligarchic redistribution, the plundering of the public domain, corruption and global anarchy” is existing in India, though it is not an advanced capitalistic economy.

When the Financial and Banking industry controlled the economy, newer products were invented to hound on the consumers.  Henry David Thoreau or Ralph Waldo Emerson would never have imagined water as a future commodity as we find it today. Consumers have greed in purchasing more than their neighbours and when they run out of purchasing power they take up consumer credit and “supplement consumerist incentives with legal obligations to work, entered into as debtors and enforced by lenders” (quoted by Wolfgang Streeck from, Financing the American Dream: A Cultural History of Consumer Credit, by Lendol Calder). Now, workers become bonded labours or slaves to the bank to repay the credit offered by the banks.

Whether a new order of political economy arises to resolve the systemic disorders of the capitalistic countries or the maddening consumerism is not my worry. But, I have always wondered (Socrates said, 'Wonder is the feeling of a philosopher, and philosophy begins with wonder.') the raise and growth of human race in this world in the past 40,000 years.

The raise of the Homo sapiens or as matter of fact the evolution of life in this earth is accidental and there is no fixed plan or a definite goal or any act of faith or freewill or any intelligent design in this evolution. It is humans, the only living species, in this world has the capability to bring his imagination and thoughts affect the course of natural evolution. The civilization, the cultures, the faiths, the social beliefs and the languages are collective changes of thoughts shaped through individual imagination; imagination is the source of knowledge. The progress in scientific sophistications and the structural changes effected to the world are individual imagination. When we look back at the history, every theory (Big Bang Theory, Atomic and Molecular Theories, Medicines, Computers, Space Travels, Artificial Intelligence, Gene Therapy, etc.) developed will have inspiration from another person’s imagination. Sooner, when Higgs Particles (or Higgs Bosons, if one would love to have an Indian name tag to it) comes into the control of science, even teleportation would be possible. Yet the only physical quantity that couldn’t get affected (or brought into the control) by human imagination is the time, the continuum.

Thirty years back, nobody would have ever imagined on the social connectivity made by the today’s digital revolution, and the current generation is craze about moving in a faster pace, creating their own solutions of the jigsaw puzzle and get easily bored and uninterested. Whatsoever happens to individuals, there are intellects who always keeps on imagining and inventing newer wheels to keep the world moving further. With technological ease, our lives are more complicated; with technological transparency, we invent more methods to hide; development in individual life is not helping overall progress of humanity, it is only leading to greater inequality. More the number of social connectivity less is the intimacy between individuals.

Human race lived for long as groups or communities, with economic development they drew distinct lines of class and further fragmented into families; technological development is further dividing families into individuals. Early people wondered at the regularity of the Universe, good natured people philosophically explored the laws of governance and further implored the secrets of atoms and elementary particles. Development, though visualised holistic it exists only as individualistic and atomic. Development sounds paradoxical and enigmatic!

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