By Trond Øverland
Keywords: Protectionism, free trade, national capitalism, Prout.
Whenever someone mentions “the economy”, many of us actually think of “our society and its economy”. It is hard for most people to separate “economy” from “society”. We often hear about fluctuating interest rates, unemployment figures, retail prices, and stock exchange markets, but all the while we wonder how such developments might impact us and our families, society and peace.
“Socio-economy too is a
collective expression of humanity”
Among all living beings, humans in particular seem to have clear ideas about progress. We aspire to be something much more than just a cog in a wheel; a piece in a financial puzzle and a figure in someone’s Excel sheet. We feel deeply that our society isn’t just meant to be an economic machine. First things first then: Actually what is a society?
Societies obviously consist of living beings. Still, for a group of people to qualify as a society they require something other than just being many in number. Societies of monkeys, thieves, and of human beings all have their particular features and qualities, a sort of purpose and dynamism that make them come alive in their own way as a society.
Take the example of passengers on a metro train. When boarding the train, all we may see is a collection of random individuals seemingly unrelated and socially quite inactive. Whereas if the train comes to an unexpected long stop in an awkward place, or an accident takes place inside the carriage, those previously apparently unrelated individuals would suddenly start to interact. Personalities, groups, etc. will come into play and a kind of society will manifest among them. Some passengers will proceed to form parties and opinions: A few will take the lead, others will follow, one or two will want to be daring, others cautious, some will argue, others will be commenting bystanders, some will try to get a more comfortable place, etc.
Still, the orderly passengers we saw when we first boarded the train also formed a society even when all they did was quietly reaching their respective destinations together. After all they were not that passive but had already paid their fares in order to form a society of passengers on their journey.
Historians label societies. For instance, our present society and times are said to be characterized by rapid technological advancement, ruthless economic competition, the emancipation of women, ecological awakening, cynicism, and a great many other things. Past societies and times have been labelled as matriarchal, patriarchal, monarchic, dark ages, enlightenment, industrial, modern, post-modern, etc. Such labels intend to convey something about the ways and customs of those societies. The long string of these labels may lead us to conclude that:
- We the members of society love to define collective and individual potentiality, perhaps as a way for us to better know and become ourselves.
- Societies frequently move from one such label to another, indicating that we have it in us to change our ways fundamentally (having to do with our evolved basis), and even rudimentally (having to do with our existential roots), in order to realize fresh potentiality.
Socio-economics, more than just economics
All living beings are born into some society or the other. Like ants in an anthill, for instance. Society is where we humans grow up to fulfil our instincts, interests, and dreams. Society is our playground, school, university, and workplace — our common home and world.
In society we realize ourselves individually and collectively. As collectives societies exhibit particular properties of life in their own collective ways. Collective sentiments of anxiety, safety, sorrow, joy, depression, hopefulness and bliss, indifference, compassion, passivity, participation, possessiveness, generosity, animosity, friendliness, revenge, forgiveness and grace, etc. are among the chief momenta we see reflected in the behaviour, traditions, and laws of societies.
Naturally, features expressed most clearly by a majority of the members of a society will typify that society. Coming back to our original subject, which is socio-economy, purely economic factors, such as investment, financial returns, and profits, are far from common to most humans but found to be dominant only among a small minority consisting of traders and others intimately connected with economics. On the other hand, the general goals and values of society — survival, security, belonging, togetherness, creativity, cultural growth, civilizational refinement, spirituell emancipation, etc. — are universal and the domain of all. It follows that society is something more than economic affairs, and that economy should be subordinate to society.
Socio-economy of individuals and groups
We have now established that, like any other dimension of human society, socio-economy too is a collective expression of humanity. One feature of socio-economics is its need for both closedness and openness in order to function properly. In human terms we may say we need a certain degree of privacy and stable personal circumstances in order to strengthen our self-reliance, while at the same time we need to develop social skills and ability to engage and participate. It follows that the closedness of a society maintains its rudimentary existence and basic identity, while its openness generates further development and integration beyond its indigenous limitations into a larger world and universal spirit.
“Countries with closed economies are entirely self-sufficient and neither export nor import goods. …
In an open economy, the country willingly trades outside of its borders, including both imports and exports…”2
A society’s first priority is the security of its members. From a security point of view, basic necessities should be produced domestically. Not only should crucial commodities be home-grown, they should also be tax-free (according to Prout1 regular domestic taxes should not be levied at the consumption stage in the form of income tax and VAT but at the starting point of production).
This is a main aspect of the closedness of a Proutistic socio-economic system: A strong foundation of basic self-sufficiency. If such self-reliance is not established, efforts should be continued until basic self-reliance is achieved.
“Socio-economic dignity starts
with basic security and rights.”
Here the term closedness is not used as in “a closed society” or “closed economy”. Psychology has taught us that abused people need to learn to set boundaries for others so that their life of abuse ends. This has to be done without becoming isolationalist, self-centered, or abusive oneself. In the same way, societies, too, need to exercise a certain autonomous control in order to recover their sense of dignity. When one is vulnerable to the control of others, one has been deprived fundamentally of their dignity and becomes a victim. Such abused socio-economies may be termed as vulnerable or victimised socio-economies. A properly developed socio-economy is self-reliant open to dignified interaction. Socio-economic dignity starts with basic security and rights.
Another aspect of Prout’s dignified socio-economics is its emphasis on mother tongue and local culture. The propounder of Prout, Shrii Prabhat Rainjan Sarkar, noted: “The psychology of suppression undermines the progress of a country. People will eventually revolt against it and restore unity. The sentiments of people cannot be forcibly suppressed for a long time. Human beings best express themselves through their mother tongue. If people’s mother tongue is suppressed, it is equivalent to strangling them. The suppression of people’s mother tongue is a sin.”3 And, “According to the policy of PROUT, besides the mother tongue, students can also learn as many languages as possible. Let people know as many languages as they can. Still, in the practical field—government and non-government work and court work—the mother tongue should be used.”43
No matter how much we human beings value our security and cherish the soil, stones, grass, plants, trees, mountains and coastlines of the country of our birth, we still dream of a greater world beyond. Human history abounds with tales of exploration of the unknown. And of great migrations. And these days, airports all over the world require constant expansion and upgrading, while on the Internet we may find and study in depth …
Crude and subtle indications abound of our universal craving for the unknown: The science of ecology tells us that all of us as well as each and everything are interconnected, while the science of spirituality prods us still further on in this respect. As each one of us awaken once again to these old truths it becomes evident that we clearly want to find the link between that which is already known to us and that which is still not.
Our common need for basic security coupled with the innate human longing for further exploration present us with an apparent socio-economic riddle: No security-conscious society can afford to leave its basic necessities to chance or to foreign powers naturlly concerned first and foremost with their own local interests. On the other hand, we cannot and do not wish to remain in isolation.
Prout’s solution to this historical conundrum is balanced dynamic development. Another term for it would be movement towards synthesis. Faced with society’s basic need to be socio-economically self-reliant, Prout balances the closed dimension with being open to global trading and bartering of semi-essential and non-essential commodities, and promoting free trading and bartering of overproduction (more on this free trade model below). Cultural exchange and cultivation of a general non-dogmatic spiritual outlook and its practice throughout the educational system completes this approach to synthesis.
Socio-economics is not an isolated field of human activity — all kinds of human acitvity are mutually related. Prout therefore invites further interaction and syntheses between various countries and regions for improved security and further progress. For instance in the form of common environmental planning and projects; implementation of universal legal values; human, animal and plants rights; united military strength, etc. For the smooth running of such global dynamics, Prout suggests the establishment of a world government based on a world constitution.5
Earlier in this short essay, society was defined in a general way illustrated by a few examples. Particularly on the socio-economic point, Prout defines societies as people with same economic problems; uniform economic potentialities; ethnic similarities; sentimental legacy including language, historical traditions, literature, common usages and cultural expressions; and similar geographical features such as topography, river systems, rainfall and irrigation water.
“A healthy socio-economy is both closed and open, serving a conglomerate of human beings, animals and plants in a dignified way.”
With a proper closed-open balance such dignified societies will continue to grow both their own independent core as well as their ability to reach out and interact. In the process, adjacent societies will increasingly find that they share socio-economic characteristics and challenges with their neighbours. Naturally, Prout suggests the merger of properly self-reliant, mature, well-matched units into greater and still greater units—until the entire World is established as one smoothly functioning dignified socio-economic unit.
Protectionism and free trade
A healthy socio-economy is both closed and open, serving a conglomerate of human beings, animals and plants in a dignified way. It is firmly secured at its core and outwardly participatory. As such, societies can deal and adjust with constant changes in both domestic and external circumstances.
Coming back to the economy again, Sarkar suggested free trade6 (trade free from export and import duties) in someone’s overproduction as a solution to the underproduction of others. Sarkar reasons that such trade will allow overproducing- and underproducing countries to make adjustments between themselves. Overproduction of any industrial or agricultural produce in one country may be consumed by another country where there is underproduction of the same commodity.
Prout does not however support trading in raw materials. Wherever there is production of raw material, efforts should be on producing refined goods within the country and not just shipping raw materials abroad.
Sarkar noted that local raw material prices in the export market are subject to manipulation and sudden fluctuations as they are currently traded through speculative commodity markets, which are controlled by vested interests. “To root out dishonesty from the field of trade, free trade should be established throughout the world as far as possible. Manufactured goods, on the other hand, are generally subject to less price manipulation and command better prices than raw materials. By manufacturing locally finished products, a socioeconomic unit can conserve its reserve bullion and improve the purchasing capacity of the local people.”7
The refining of raw materials at home will strengthen domestic technology and know-how whereas wholesale exports of raw material will only increase trade imbalances (the difference between the value of a country’s exports and imports) due to the fact that consumer products generally command higher prices than raw materials. For instance, if a country exports cotton and imports cotton products it will stand to lose in so many ways on the transaction. Sarkar emphasized:
“Free trade should be encouraged once self-sufficiency is attained, as this will help facilitate increased prosperity and encourage economic parity among socio-economic units, and lead to the formation of larger socio-economic units.”8
Prout’s raw material doctrine is of course diametrically opposed to the present trading practices of global capitalism. Prout clearly contradicts the classic capitalist theories on the importance of comparative and absolute advantages in the creation of global wealth, formulated by Adam Smith and David Ricardo. Today, all that is left of Smith and Ricardo’s theories is the frantic search of capitalist exploiters for profitable resources (cheap labour, available raw materials, ready markets, etc.) all round the world. Those basic ideas of global capitalism, once heralded as harbingers of universal prosperity, are no longer indicative of any mutual benefit but only of one-way profiteering.
Prout’s model of trade can be said to be a synthesis of protectionism and free trade. This synthesis will, like Prout itself, remain dynamic and not cut in stone. Prout’s dynamic model of trade, which opens the doors to both protectionism and free trade, will be able to adjust to constant changes in various countries and the world in order to serve consumers first and foremost and then society.
Two socio-economic solutions
It is often said that capitalism is an open system. Open to what, one may ask. At most we can say that capitalism seems to be wide open to exploitation of any available resources. With its dominating tendency towards centralisation of wealth, capitalism seems to be more of a closed system as far as generating opportunities for all individuals and the collective.
Prout points to a number of significant conflicts and contradictions under capitalism that need to be resolved. Two particularly severe structural dichotomies are:
- Unbridled private wealth accumulation as opposed to rational distribution
- Profit maximization as opposed to maximum utilization
Unbridled private wealth accumulation vs. rational distribution
Rational distribution instead of unbridled accumulation has to do with ensuring universal access to resources and prevention of fatal standstills and collapses. Apart from the enormity of the suffering that capitalist exploitation has caused to society before the onset of its own serious crises and eventual collapse, there are two particularly critical structural downsides to its exploitative nature that his capitalists themselves in the final phase of capitalism; one physical and the other mental.
Firstly, the colossal accumulation of physical wealth by a few leads to a state of affairs where vast funds are no longer accessible to society. The negative implications of such a situation become particularly apparent in economically uncertain times when the exceedingly profit-hungry and hyper-rich few prefer to hold back on investing instead of risking losing on it.
This holding back of enormous and most critical capital reserves in times of particular need naturally results in large-scale financial and industrial standstills. It is the natural outcome of the speculative, hesitating, and essentially criminal motivations of the mega-rich and most greedy at a time when profitable opportunities no longer abound but their essentially exploitative instincts probably are stronger than ever before.
This is the second downside to liberal capitalism: The psyche of those who keep accumulating beyond their actual needs, and at the cost of the life quality and indeed lives of others, corrupts increasingly and degenerates into sub-animal greed and crudity. In the end such people become unable to perceive—not to speak of act on—the acute needs of severely deprived individuals and societies, even in times of their extreme physical, mental and spiritual crises.
In fact, not even in its worst nightmares does the capitalist instinct dream of kneeling humbly before humanity. Rather, in the same way as the proverbial duty-bound seacaptain prefers to go down with his ship, the capitalist demons in human form would sort of prefer to one day leave the rest of us for good with all their ill-begotten riches in hand even if in this case that would call for the entire world to go down first.
Remove the rich from socio-economic power
In order to liberate society from economic exploitation, Prout suggests to initially:
- Remove the rich from socio-economic power.
- Limit individual accumulation.
- Establish a system of rational distribution where everyone is guaranteed a minimum of purchasing power in exchange for their work, and where the extra output of the industrious and those with above-average talent are further rewarded from what is left after everyone’s basic needs and those of the collective are secured.
This is the value of rational distribution: To provide for the minimum needs of all (on the strength of their work) and at the same time reward those deserving and meritorious for their above average output.
Profit maximization vs. maximum utilization
Profit maximization vs. maximum utilization has to do with the utilization of all kinds of resources: individual, collective, physical, economic, political, social, cultural, mental, and spiritual resources. Let us first take a quick look at the main controlling hubs of all such resources today: Stock exchanges.
The main task of companies listed on stock exchanges is to reward share owners for their investment. This basically counterproductive business template has led to a universal rat race where “leaner and meaner” equals good practice. The term “counterproductive” has been used, as it seems so much more productive to allow investments to be harvested by those who work on them directly, and not by someone unrelated
This is the same principle as the one applied in the establishment of basic security touched on earlier when discussing socio-economic closedness. We should attempt to properly appreciate the socio-economic implications of direct ownership by employees, and conversely their potential alienation towards the total value created by the enterprise they work in.
As already mentioned, global capitalism involves opportunistic restructuring and reallocation of operations to wherever cheap raw materials, labour, etc. are readily available. This essentially one-eyed, profit-motivated strategy entails layoffs, poverty, and ruin in formerly prosperous areas being suddenly laid to waste by the sociopatic dictates of stock exchanges and big banks.
By contrast, Prout upholds the principle of maximum utilization. It means continuous accelerated all-round output of individuals and societies, and not of their financial output alone.
As already indicated, human beings and their societies possess numerous physical, mental, political, social, cultural, and spiritual potentialities which can be harnessed and put to good use. A society is a collective mirror of its individual members in many respects of their lives, and at the same time societies take on their own, collective shape and form. To paraphrase what has already been stated: To make economic potential the end all of individuals and society is not only a serious misapprehension – it perverts the natural evolution. The most natural thing for human beings is to bring the potentialities of all living beings towards fulfilment. Capitalism, on the other hand, is a system that allows only for the greed of a few to grow by all leaps and bounds at the cost of the life quality and indeed the life of the rest of us.
Very few human beings are, as already mentioned, economically motivated in their basic life aspirations. The most important thing for most of us is to be well and live our lives in satisfying physical, mental and spiritual development and richness. Only a very few are willing to renounce their mental and spiritual development in order to sacrifice all their life energy for the collection of physical riches at the cost of the welfare of others.
If the prevailing system dictates an exclusively economic approach to life, we should liberate ourselves from it. In order for us to embark on the journey from a profit-motivated setup to one of maximum utilization of all resources—physical, mental, spiritual—we first need to close down the stock exchanges and all other exploitative capitalist institutions, including all big banks except for the central bank. In the place of profit-motivated economics we should cultivate a socio-economy centering on consumer-motivated cooperative enterprises free of profit-motivation.9
Prout’s aim is all-round development. It wants people to live physically, mentally and spiritually fulfilled lives. Prout’s definition of progress10 is movement towards the highest good, towards supreme emancipation. Practically speaking then, Prout’s progressive socio-economics is embedded in trust in a clear idea of what all-round progress really is.
The bonds between individual human beings and societies are intrinsic, deep, and undeniable. Trust is an instinct, a basic inner force that living beings mobilize in order to bond with circumstances. In the same way as individuals need to trust themselves, societies need to trust their worth and innate capabilities. For this the members of a society require a clear image and understanding of their common journey through history and of the objectives and goals that are in front of them. Without such strong, deep-felt self-assurance and self-understanding little can be done.
Again we witness the need for closedness and openness playing round each other towards a greater and mnore comprehensive synthesis. Societies need to nurture both their native identity and their universal soul.
Time and again throughout human history hero worship has provided the members of societies with much needed self-assurance and understanding – and not seldom with only a devilish semblance of it. Many a strong leader, armed with notions of ideological grandiosity, has attempted to hold up images of eagerly anticipated societal greatness. More often than not such imagery has been painted in colours of stark nationalism and even today, in our modern world of greatly expanded global sense and sensibilities, we still get to see the return of crude nationalism in many places.
Right now we witness the rapid growth of national capitalist (Naci) ideology both in superpowers such as China and the US, and in many European countries. Nacism promotes capitalist interests on a pseudo-nationalist platform. The term pseudo-nationalism is used here as Nacism carries the mask of nationalism over its real face of capitalism. Nacism is fundamentally fake and a contradiction in terms as capitalism’s greed and level of exploitation will never stop growing by itself. The malignant cancer at the core of Nacism will continue to spread across any geographical boundary. Neither will Nacism serve any one nation (but only exploit its citizens) and neither will it stay within any limit or border.
Nacism could turn out to be far worse than national socialism (Nazism). As Nazism and other geo-centred “isms” have already proven, nationalism produces to a very high degree excluding and negative sentiments and far much less inclusive and positive ones. The industrial force of Nacism coupled with its nationally mobilising force and the systemic coherence of global capitalism continue to bolster the momentum of this monstrous force in the world today.
Renaissance of a greater sense of belonging
The term nation indicates “unity based on birthplace”. As already touched upon, the truth of ecology and spirituality is that we are all born on this planet in this Universe rather than that each one of us were born in a small special place. To those who have awakened to this ecological and spiritual ethos already, the sweet appeal of the “global village” is obvious. Today, claiming that one only lives in a country quite isolated from the rest of the world is a symptom of severe existential myopia with all its unfortunate consequences.
Our crises-stricken world is crying out for comprehensive, unifying, universal thinking that may serve today’s emerging world society in all spheres of existence—physical, economic, political, social, cultural, mental, and spiritual.
The global economy appear as “the One ring to bring them all and in the darkness bind them”. Indeed, more than any other current factor or element, capitalist economy dictates the lives of most of us, namely the conditions and circumstances we live in. So it is the economy we have to change if we are to liberate ourselves from exploitation and reclaim our existence locally and globally, individually and collectively.
We humans are many-faceted beings with numerous needs, aspirations, and potentialities. Whatever we are and desire to be, we are not just cog and wheels in an economic robot. Our main job is therefore not only to dismantle capitalism but also to construct and evolve a truly human economic system. It would be a dignified system where both socio-economic closedness and openness are recognized and put into practice and synthesized.
1 The fundamental principles of the Progressive Utilization Theory (Prout) propounded by Shrii Prabhat Rainjan Sarkar in 1959: http://proutglobe.org/2011/05/5-fundamental-principles-of-prout/
2 Source: “What are the differences between closed and open economies?”
3 “Three Cardinal Socio-economic Principles,” P.R. Sarkar. Prout in a Nutshell Part 16. Ananda Marga Publications. http://proutglobe.org/2017/03/three-cardinal-socio-political-principles/
4 “Talks on Education – Excerpt 4,” P.R. Sarkar. Prout in a Nutshell Part 18. Ananda Marga Publications.
5 Material on Prout’s concept of world government: http://proutglobe.org/prout/socio-economics/social/political/world-government/
6 “Economic Dynamics,” P.R. Sarkar. A Few Problems Solved Part 9. Ananda Marga Publications. http://proutglobe.org/2011/05/economic-dynamics/
7 “Socio-economic Movements,” P.R. Sarkar. A Few Problems Solved Part 8. Ananda Marga Publications. http://proutglobe.org/2011/06/socio-economic-movements/
8 “Decentralized Economy – 1”. P.R. Sarkar. Prout in a Nutshell Volume 4 Part 21, and in Proutist Economics. http://proutglobe.org/2011/06/decentralized-economy-1/
9 For more on Prout’s cooperative economy, see: http://proutglobe.org/coops
10 The term progress derives from the Latin progradi, indicating «forward movement». The Latin term may be related to pragati in Sanskrit, meaning “well-directed movement”.