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Revival of Socialistic Thinking - A Danger signal for India Introducton Economic upheaval in USA and in some European countries

from 2008 onwards & the current dip in our growth rate, coupled with weakening of the rupee, seems to be tilting our thinking towards socialistic lines !arket and competition oriented approaches are being painted in undesirable colours not onl" b" our communist parties, but also b" intellectuals like !rs Arundhati #o" and some others Also contributing to this tilt are those activists who are genuinel" concerned about our deteriorating environment as well as about the fact that displacement of $adivasis% and others caused b" the development pro&ects has been handled so far in a slipshod manner 'he aim here is to alert us against the likel" danger of reversing the direction of ())( economic liberali*ation, when stage had been reached needing plane load+s, of our gold being shipped out -et us dwell on a few basics on this crucial sub&ect My dozen years of work experience in pu lic sector 'his one million ton steel plant located in .est /engal never produced a million tons for almost a full decade /efore we have a look at man" reasons for this sub0standard performance over such a long period, we must answer one 1uestion ver" clearl" Should this plant have produced 1ualit" product to its full capacit" or was it 23 for it to limp along, since it was providing emplo"ment to 40,000 plus people from various parts of 5ndia 5f the plant is not generating enough returns to meet the costs, leave alone generating surpluses for future e6pansion and investment in research7 is it acceptable that the deficit is met from ta6es paid b" "ou and me8 9ow long can we afford to do that8 .h" should sub0standard performance be tolerated and encouraged 8 'herefore, shall we sa" that each production unit, each service unit must , not onl" stand on its own feet, but also generate surpluses, generate wealth 9aving said that, let us now briefl" scan the goings on in this million ton steel plant which caused such poor performance "ear in and "ear out 2n top of the list would be lack of discipline among the workforce 5ndulging in gossip was more important than coming back to work in time after lunch 'he pace of work was generall" leisurel" and lethargic Slow downs would be resorted to for some increase in work content, which becomes inevitable from time to time to meet some process changes or design changes Sleeping while on dut" during the night shift was common Strikes took place for an" flims" demand b" an" one of the half a do*en trade unions Electric 2verhead :rane 2perators union, having a few do*en members in a plant with a 40,000 plus workforce could and did often bring the whole plant operations to a grinding halt for some grievance that affected them alone 5t is therefore no wonder that productivit" was low and the output remained well below the designed capacit" A ver" legitimate 1uestion that arises is as to wh" did the managers not put their heart and soul to correct the situation 2bvious answer is, wh" would the" stick their neck out ; increments were standard for all irrespective of performance and the &ob was fairl" safe <ou could alwa"s pass the buck =ow this is not something unusual for a government run establishment $An e6ample are the huge mone"0losing and mismanaged companies owned b" the 5talian government toda" and run in part as businesses, in part to emplo" workers, in part as patronage for politicians and their friends > >the onl" countr" in which the government programmes run after world war 55 have been successful, b" & large, is ?apan 5n ever" other countr" ; and in democratic countries &ust as much in communist ones ; most government programmes since world war 55 have been disasters 5f the" achieved an" results, the" were often the ver" opposite of what the" were enacted for 'his goes for the frantic efforts in the Soviet Union since 3hrushchev%s da"s to improve farm production and farm productivit"

When the Chinese, however, privatized their farms; production and productivity shot up almost overnight. The New Realities ! "y #eter $ruc%er & '()( pu"lication
!hy did the econo"y of #SSR collapse $ 5nstances like the following were common to read in the news papers and &ournals during the seventies and earl" eighties A tourist saw in a side alle" in a big cit", the rear wheels of a ta6i &acked up with engine running 'he response to the 1uer" with a wide grin was, $ 5 am completing m" 1uota of miles for the da" % Surel" concern for effective public service was not his priorit" Another instance was that of a group visiting a factor" in the interior As their vehicle approached, the" saw a festive atmosphere , with colourful flags and buntings all round and the emplo"ees milling around with hardl" an" work going on Answer to the 1uestion, $.hat is being celebrated8% was prompt, $'oda" is our @eneral !anager%s birthda" % 2bviousl" the management was collaborating in this fun at the cost of productivit" =o where else, 5 presume, @!%s birthda" can be celebrated in such st"le 5n one factor" it was noticed that the consumption of vodka would start well before the shift closing time 2ne worker was seen with his coat tails tightl" s1uee*ed in a bench vice as he could not stand straight and when the siren sounded he was escorted out b" the colleagues 5n another instance, the foreman came out with the list of workers, who were basking in the sun out in the open after the lunch break was over and started calling out names one b" one 2nl" that person would get up and proceed inside to the work station whose name had been called out 'hus the last name called out would get substantiall" e6tra time under the sun when he should have been operating some machine inside <ou would%nt sa" that the concern for productivit" was high among the workers or the foreman .ould "ou8 :oming to the farming sector, let us peruse what went on in china A BCollowing the :ommunist Dart" of :hina%s victor" in the :hinese :ivil .ar, control of the farmlands was taken awa" from landlords and redistributed to the 400 million peasant farmers 5n ()E2, graduall" consolidating its power following the civil war, the government began organi*ing the peasants into teams 'hree "ears later, these teams were combined into producer cooperatives, enacting the Socialist goal of collective land ownership 5n the following "ear, ()EF, the government formall" took control of the land, further structuring the farmland into large government0operated collective farms 5n the ()E8, B@reat -eap CorwardG campaign initiated b" !ao Hedong, land use was placed under closer government control in an effort to improve agricultural output> :ollectives were organi*ed into communes, private food production was banned, and collective eating was re1uired> 'he farming inefficiencies created b" this campaign led to 'he @reat :hinese Camine, resulting in the deaths of somewhere between the government estimate of (I million to scholarl" estimates of 20 to I4 million >>>> % JinternetK So"e %onclusions that Stand &ut 'he evidence thus far, of empirical e6periments lasting over man" decades in various parts of the socialist world, can help us to draw some ver" useful conclusionsA ( Human beings perform, face hardships in pursuit of success, display high tolerance to frustration and take risks primarily in Self Interest E6ceptions have been in the areas of religious faith or patriotism 9owever, our focus remains on human behaviour in the economic sphere Dov Seidman, in his book entitled, How : Why do we do any thing, Means everything a 2007 !bli"ation talks abo!t em iri"ally tested henomenon o# altr!isti" hel ing being a biologi"al henomenon$ %es, & "an vis!ali'e o!r innate tenden"y to hel others in some sit!ations( b!t whether it "an be a li#e long rin"i le ) a li#e long ra"ti"e in all sit!ations where one s!bordinates ones own interest and that o# the #amily day a#ter day , year a#ter year , does

not a ear realisti" to me$ &t did not s!""eed in the so"ialist "o!ntries over a seven de"ade long e* eriment$ 2 'he socialistic pattern of the government or government st"le working public sector getting directl" involved in providing goods and services to the societ" is not the right path for generating wealth 5t did not work in USS#, it did not work in 5ndia, it did not work an" where Cew instances of the $=av #atnas% and $mini #atna% companies in the public sector in 5ndia are an e6ception to the rule of wasteful deplo"ment of material and human resources b" them Even among these $#atna% and $mini #atna% companies utili*ation of resources cannot be called to be in the range of e6cellence, which is based on m" personal observation And wealth must be generated b" efficient and innovative use of resources, followed b" effective marketing 'o what use it is put to and how it is done is the legitimate role of the government 4 Profit is not a dirty word. Profiteering is. !aking profit b" an enterprise engaged in production and deliver" of goods & services to the societ" is a crucial foundation that must not be maligned Drofit is the onl" valid measure, discovered so far, to assess if the enterprise is using the societal resources efficientl" and is adding value to the e6tent that the public is willing to bu" and use the output time after time Drofit must be large enough not onl" to sustain the enterprise and protect the livelihood of man" emplo"ees and their families7 but must generate enough surpluses for future e6pansion, investment in research and garner ade1uate reserves for a rain" da", without an" need to lean on the government 2ut of this scale of profits, the amount needed to satisf" some whims and fancies of the entrepreneur should be peanuts @overnment can see to it that this does not include presenting an aero plane as a birthda" gift to one%s wife, if that seems relevant Entrepreneurial spirit must not be killed 5t is one man%s strong desire for success coupled with talent that breeds innovation and risk taking behaviour without which surpluses do not get created After all, :hinese super economic success followed onl" after ()L8 liberali*ation I Drofiteering occurs when Self ; 5nterest turns into @reed and the entrepreneur resorts to unethical practices like manipulating the market, killing competition, offering sub0 standard 1ualit" product as a champion product, corruption etc And that%s where the government role of regulation comes in 'o m" mind, what went wrong in USA & some parts of the western world leading to the economic malaise seen 2008 onwards 7 is that @reed was allowed to have a field da" 'he concerned governments had not taken enough care to see that the Self ; 5nterest motive sta"s within the circle of $Enlightened Self ; 5nterest $ and does not degenerate into @reed Similar stor" holds good to m" mind, relating to corruption allegations After ())( liberali*ation, governance did not get ade1uatel" strengthened to be bale to check that $self0 interset% ; the engine of growth ; does not degenerate nto greed E Apart from defense, foreign affairs, education, healthcare etc, other ma&or role of the government ought to be to regulate the entrepreneurial activit" within ethical guidelines7 rather than waste its talent in production and distribution of goods and services needed b" the societ" 5t must remember that talented people onl" can make difference, and the" are alwa"s in short suppl" And the talent available with the government must be deplo"ed for high priorit" areas like regulating the entrepreneurial activit" in the countr"

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