FAQ: Industry

What is required for industrial revolution?
Areas must not depend on raw materials from outside their area. Raw materials must be locally produced. They should be indigenous. Those people who love the society must think in terms of an industrial revolution based on the raw materials available in that particular area.

What are the three parts of the PROUT industrial structure?
The three parts of PROUT’s industrial structure are:

  • Key industries, to be managed by the immediate or local government
  • Cooperatives
  • Private enterprises

This three-tiered system will remove confusion about whether any industry should be managed privately or by the government, and will avoid duplication between the government and private enterprise.

What is PROUT’s approach to production?
“Production for consumption, not production for profit!”

What is required to build a sound economy?
Thirty to forty percent of the people should depend directly on agriculture. If the percentage is smaller, agriculture is neglected. If the percentage is larger, there will be a heavy strain on agriculture. In addition to this percentage engaged in agriculture, about twenty percent of the people should depend on agro-industries, twenty percent on agrico-industries, ten percent on general trade and commerce, and ten percent on intellectual or white collar jobs. The percentage of people engaged in non-agricultural industries should be kept to within 20-30 percent of the population. This will lead to a balanced economy – a balanced socio-economic structure. (Agrico refers to production of agricultural equipment such as tractors. Agro refers to production of flour, cloth, herbal medicine factories – products made from agricultural produce.)

How are industries managed in a decentralized versus centralized economy?
In a centralized economy industries are managed as either private companies or state enterprises. In a decentralized economy, key industries, medium-scale industries and small-scale industries will be managed by different groups of people.

Who would manage the various industries?
The local government would manage key industries. However, they would be guided by the principle of ‘no profit, no loss.’ Medium-scale industries should be managed by cooperatives, but should not be guided by monopoly production and profit. The cooperative sector will be the main sector of the economy. Small-scale and cottage industries will be in the hands of individuals. Though privately owned, they must maintain adjustment with the cooperatives to ensure a balanced economy.

What is the goal of production in capitalist and communist economies?
In capitalist economies, production is for the profit of the capitalist. In socialist economies, the profit goes to the state and only a tiny amount goes to the producers, the laborers. Both systems are in fact capitalist systems.

What will happen in a PROUT economy?
Production will be solely for consumption. There will not be profit motive, hence there will be no inflation. In Proutist production, the value of money will remain constant, and full purchasing capacity as well as the minimum requirements of life will be guaranteed to the people. As time passes, both the purchasing power will increase and also the minimum requirements of life will increase. The standard of living will go on increasing for all the people.

According to PROUT agriculture is the most important part of the economy, how should the agricultural system be structured?
It should be structured as an industry. The prices of agricultural produce should be determined by considering basic factors such as agricultural income, expenses and necessities.

How would power be supplied in a decentralized economy?
Local administrators will have to arrange for the supply of sufficient power to facilitate industrial production. They will need to supply locally generated power such as solar energy, thermal energy, bio-gas, hydroelectricity, nuclear energy, pneumatic energy, electromagnetic energy, and tidal power, or any other power which is easily available locally. The generation of power is a key industry and hence should be run on a no profit, no loss basis. The immediate government or state government must be responsible for providing power to the people as a key industry.

What happens with over-industrialization?
If an area becomes industrially overdeveloped, or the more the percentage of people engaged in industry increases above 30-40 percent, they will not find a market for the consumer goods they produce, and they will suffer from economic depression and growing unemployment.

How does production inflation occur?
It occurs due to the application of scientific methods which causes a great increase in production in excess of demand and leads to the problem of what to do with the excess.

What measures can be taken to solve the problem of overproduction?
First, there should be a free trade system so that overproduction can be consumed by other countries or other socio-economic units having inadequate supplies of the particular product. For example, in most parts of India there is underproduction of milk. But in England, Germany and Sweden there is overproduction of milk. Hence there can be a barter system between these countries so that all benefit from the overproduction in other countries.

What is the second measure to solve the problem of overproduction?
Proper storage facilities should be constructed to house excess goods. Also processing factories should be established which can produce dried mango, mango candy, mango juice, sauce, jam, and so forth, so that fresh mango when converted like this can be stored for longer periods and used by the people. In the same way vegetable processing factories can be established to utilize the excess vegetables grown in the winter season in India, for example.

What is the third measure to solve the problem of overproduction?
New and diversified styles of consumption should be continually invented. Okra is presently used only as a vegetable. But, oil can be extracted from the okra seeds and processed and marketed as edible oil. Fine thread can be manufactured from the okra plant and good quality clothes made from that thread.

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