People’s purchasing power first; economic democracy now

Illustration: Real purchasing power projected (USA). Source: Colorado Department of Transportation 2014

The Requirements for Economic Democracy:

  • Minimum requirements of life must be guaranteed to all.
  • Increasing purchasing power must be guaranteed to each and every individual.
  • The power to make all economic decisions must be placed in the hands of the local people.
  • Outsiders must be strictly prevented from interfering in the local economy.

Guarantee of Minimum Requirements

Each and every person should be convinced that the entire wealth of the world is the common patrimony of all. To utilize that wealth is the birthright of everyone and no interference in that birthright will be permissible. (Human Society Is One and Indivisible – 2)  Each and every person should be guaranteed the minimum necessities of life.
Human Society Is One and Indivisible – 2 (all quotes by Shrii Prabhat Rainjan Sarkar) 

So the minimum requirements of life should be made available to everybody. In other words, food, clothing, medical treatment, housing and education must be provided to all. The minimum necessities must be provided for all people according to the age in which they live.
From Ánanda Sútram, chapter 5

The fundamental theory is that with increased responsibility the authority of the state should also increase, but while operating its authority the state should not go against public sentiments. The fundamental public interest is that the minimum requirements of the life should be guaranteed.
– From Talks on Prout

Those who are struggling hard all the time for physical existence get little time for mental development. The problem of bread and butter will stagger the development of mind. The guarantee of equal opportunity and minimum requirements of life to all is an essentiality for the well-integrated elevation and evolution of the human personality.
Human Progress

We are not only to recognize these requirements, but also to guarantee the availability of the requirements, which includes our social responsibility of supplying individuals with purchasing power.
Discourses on Prout

The minimum requirements can be assured through guaranteed purchasing capacity, which should be enshrined in the constitution as a fundamental or cardinal human right. This will give the citizens of the country legal power if their minimum requirements are not met.
Quadri-Dimensional Economy

Guaranteed availability of foodstuffs, clothing, medical assistance and housing accommodation should be arranged so that human beings may be able to utilize their surplus energy (energy up till now engaged in procuring the essentialities of life) in subtler pursuits. Side by side, there should be sufficient scope for providing other amenities of the progressive age. To fulfil the above responsibilities, enough purchasing capacity should be created.
The Cosmic Brotherhood

Increasing Purchasing Power Must Be Guaranteed

Prout does not support the existing practice of considering the per capita income as the index of peopleʼs economic standard. Per capita income is a deceptive and defective measure of collective wealth popularized by capitalist economists to fool people and cover their exploitation. The genuine measure of peopleʼs economic advancement is increasing purchasing capacity.
Block-Level Planning

Prout suggests that increases in per capita income are not a sufficiently reliable and scientific index to determine the standard and progress of a particular socio-economic unit. Rather, this approach is misleading and deceitful, because it refers to a simple mathematical calculation of total national income divided by total population. This does not give the correct picture of the standard of living of the people of a particular socio-economic unit, as the wealth disparity in society is concealed. Per capita income shows the mean and not the variation of income distribution. If inflation is also considered, the reliability of per capita income is further reduced.

On the other hand, purchasing capacity is the real index of how a personʼs economic needs can be met by their income. All Proutʼs plans and programmes in the socio-economic sphere should be aimed at increasing the purchasing capacity of the people. Note that Prout stresses increasing purchasing capacity and not per capita income. Per capita income is not a proper indication of the increase in the standard of living of the people because while people may have very high incomes they may not be able to purchase the necessities of life. On the other hand if the per capita income is low but people have great purchasing capacity they are much better off. So purchasing capacity and not per capita income is the true measure of economic prosperity. Everyoneʼs requirements should be within their pecuniary periphery or purchasing capacity.
– “Questions and Answers on Society – 2”, Prout in a Nutshell Volume 3, Part 12

The first thing that must be done to increase the purchasing capacity of the common people is to maximize the production of essential commodities, not the production of luxury goods. This will restore parity between production and consumption and ensure that the minimum requirements are supplied to all. (Some Specialities of Proutʼs Economic System) 

To increase peopleʼs purchasing capacity, the easy availability of the minimum requirements, stable prices, progressive, periodic increases in wages and salaries, and increasing collective wealth must be ensured.

In Proutʼs economy there will be no limit of purchasing capacity; that is, the responsibility of planners will be to make purchasing capacity ever-increasing. The minimum requirements must be guaranteed, and always be increased according to time, space and person. (Block-Level Planning)  Thus Proutʼs aim is to continuously increase the purchasing capacity of the people in conjunction with the economic development of the concerned economic unit.
Block-Level Planning

To effectively [provide incentives to increase production], increasing the purchasing capacity of each individual is the controlling factor in a Proutistic economy.
Some Specialities of Proutʼs Economic System

Economic Power in the Hands of the Local People

In all human actions the tender touch of humanity should be present. Those with the tendency to not deprive others cannot, on the grounds of justice and equity, accept the principle of private ownership. The economic structures in the world today, however, are not based on human rights. In order to recognize human rights, one will have to be ready for revolutionary changes, and one will also have to welcome them. The socialization of landed property, industry, trade and commerce – almost everything – is the major objective of this revolution.

Here in this context I deliberately have not used the term “nationalization”. Just as the slogans “Landlords are not the owners of the land” and “Industrialists are not the owners of the factories” are incorrect, similarly the slogans “Land belongs to those who push the plough” and “Factories belong to those who wield the hammer” are also incorrect. The people in general are the real owners of all the wealth in this world, and that is why I have used the term “socialization”.
Problems of Day

Economic liberation is the birthright of every individual. To achieve it, economic power must be vested in the local people. In economic democracy the local people will have the power to make all economic decisions, to produce commodities on the basis of collective necessity, and to distribute all agricultural and industrial commodities. (Economic Democracy) 

The most essential things for self-preservation are first food and then clothing. So let us discuss the problems of food and clothing. (Various Occupations) 

In the production of food, the question of ownership by non-producing business people does not arise at all.
– “Various Occupations”, Human Society 1

If anyone thinks that land should be owned by individual cultivators because they are deeply attached to their land, we may also argue that those who own land but do not work in the fields have and will continue to have a deep attachment to their land. Actually in this matter we should give more importance to collective welfare than to the sentiments of the individual. In my opinion all the land in the entire universe is the common property of every human being. A particular individual, group of individuals or state should only have the right to preserve and properly utilize a particular piece of land.
– “Various Occupations”, Human Society 1

The disadvantages of private ownership will not manifest if the land is collectively owned in a cooperative system. The use of proper scientific methods will make it possible to increase crop production without much effort.

It is undesirable for business people to have the right to distribute food grains. Only consumers cooperatives should have this right. As long as the production and distribution of crops is controlled by vaeshyas rather than by cooperatives, it is absolutely impossible to stop hoarding, speculation, black marketing and adulteration in food markets. The slightest weakness in such matters will have extremely dangerous consequences. Such weakness is not at all desirable in those who love humanity and practise politics.
– “Various Occupations”, Human Society 1

Local consumers cooperatives should have the sole right to distribute essential, though not all, varieties of clothing, and the essential fuels produced in their countries (wood is used in some places, and coal or oil in others) in any given age. Producers cooperatives should have the sole right to produce essential clothing and, as far as practicable, essential fuels. Where this is not possible (such as where the conditions and climate are unsuitable for spinning thread) the right to produce the associated raw or half-finished materials for a particular industry and to supply them to producers cooperatives, should belong to the state government or local autonomous bodies and not to business people. At most, business people should have the right to produce and distribute non-essential foods and fuels, because then there is virtually no chance of their exploiting the common people by exerting undue pressure on them.

Business people should not be given the right to produce reading and writing materials or any commodities not classified as luxury items (such as razor blades, washing soap, etc.) Only producers cooperatives or the state government should have this right. These goods should, of course, be distributed through consumers cooperatives.

Business people should not have the right to produce materials for constructing houses (such as cement and metal products) that cannot be easily manufactured everywhere. Such materials should be manufactured directly by the state government or by large cooperatives which are supported by the state government. Distribution should be directly arranged by the state government or by state-controlled autonomous bodies. Business people should not be allowed to meddle in such matters at all because they will try to create artificial scarcity, to increase the demand for commodities which are in limited supply.
– “Various Occupations”, Human Society 1

As with construction materials, the manufacture of drugs is not safe in the hands of business people. (Various Occupations)  The right to manufacture medicines should be entrusted to autonomous bodies which can distribute the medicines themselves or through consumers cooperatives. If necessary, certain types of medicines may be manufactured by the state or central government, but it is preferable for them to be distributed by autonomous bodies or cooperatives.
– “Various Occupations”, Human Society 1

The less private enterprise is provided with business opportunities and the more production and distribution is carried out through cooperatives and autonomous bodies, the better. The less the government is involved with the public in the areas of production and distribution the better its relationship with them will be, and the less power the central government has in these areas the better.
– “Various Occupations”, Human Society 1 

Political democracy

In all countries where democracy is in vogue today, people have been deceived into believing that there is no better system than political democracy. Political democracy has no doubt granted voting rights, but it has snatched away the right of economic equality. Consequently, there is gross economic disparity between the rich and the poor, immense inequality in peopleʼs purchasing capacity, unemployment, chronic food shortages, poverty and insecurity in society.

The type of democracy prevalent in India is also political democracy, and it has proved to be a unique system of exploitation. The Indian constitution was created by three groups of exploiters: the British imperialists, the Indian imperialists and the ruling parties representing the Indian capitalists. All the provisions of the Indian constitution were framed keeping an eye on furthering the interests of these opportunists. Just to hoodwink the masses, the people were granted the right of universal suffrage. Millions of Indians are poor, superstitious and illiterate, yet the exploiters, through such practices as making false promises, intimidation, gross abuse of administrative power and vote rigging, repeatedly win over the electorate. This is the farce of democracy. Once they form the government, they get ample opportunity to indulge in rampant corruption and political tyranny for five years. In the subsequent elections – whether on the provincial or state level – the same absurdity is repeated.

This type of political opportunism has been going on in India since independence. For the last thirty-five years, the political parties have maintained that in order to attain economic parity with the industrially developed countries of Europe, India must follow the democratic system. To support this argument, they cite the examples of America and Great Britain or China and the Soviet Union. The political leaders urge the electorate to vote in their favour at election time so that the countryʼs starving masses can reap the benefits of a developed economy. But once the elections are over, the exploitation of the common people continues unabated in the garb of political democracy, and other areas of social life are completely neglected. Today millions of Indian citizens are being deprived of the minimum requirements of life and are struggling to procure adequate food, clothing, housing, education and medical treatment, while a handful of people are rolling in enormous wealth and luxury.

One of the most obvious defects of democracy is that voting is based upon universal suffrage. That is, the right to cast a vote depends on age. Once people reach a certain age, it is assumed that they have the requisite capacity to weigh the pros and cons of the issues in an election and select the best candidate. But there are many people above the voting age who have little or no interest in elections and are not conversant with social or economic issues. In many cases, they vote for the party rather than the candidate, and are swayed by election propaganda or the false promises of politicians. Those who have not reached the voting age are often more capable of selecting the best candidate than those who are entitled to vote. So age should not be the yardstick for voting rights.

Whether or not a candidate gets elected usually depends upon party affiliation, political patronage and election expenditure. In some cases it also depends on antisocial practices. Throughout the world, money plays a dominant role in the electoral process, and in nearly all cases, only those who are rich and powerful can hope to secure elected office. In those countries where voting is not compulsory, often only a small percentage of the population participates in the electoral process.

The prerequisites for the success of democracy are morality, education and socio-economico-political consciousness. Leaders especially must be people of high moral character, otherwise the welfare of society will be jeopardized. But today in most democracies, people of dubious character and those with vested interests are elected to power. Even bandits and murderers stand for election and form the government.

In almost all the countries of the world, the masses lack political consciousness. Cunning, erudite politicians take advantage of this shortcoming to confuse people and attain power. They resort to immoral practices such as bribery, vote rigging, booth capturing and buying of votes, and stand unopposed for elections. Consequently, the standard of morality in society is declining, and honest, competent people are relegated to the background. Moral leaders have less chance to win elections because election results are rigged through financial inducements, intimidation and brute force. In the present democratic system, all sorts of immoral and corrupt practices are given the opportunity to pervert society. The very nature of the present system is that it favours the capitalists and exposes the administration to immoral and corrupt forces.

The farce of democracy has been likened to a puppet show where a handful of power hungry politicians pull the strings from behind the scene. In liberal democracies, capitalists manipulate the mass media such as the radio, television and newspapers, while in socialist democracies the bureaucrats lead the country to the brink of destruction. In both forms of democracy, there is little scope for honest, competent leaders to emerge in society, and virtually no possibility for the economic liberation of the people.

Political democracy has become a great hoax for the people of the world. It promises the advent of an era of peace, prosperity and equality, but in reality it creates criminals, encourages exploitation and throws common people into an abyss of sorrow and suffering.

The days of political democracy are numbered. PROUT demands economic democracy, not political democracy. To make democracy successful, economic power must be vested in the hands of the common people and the minimum requirements of life must be guaranteed to all. This is the only way to ensure the economic liberation of the people. PROUTʼS slogan is: “To end exploitation we demand economic democracy, not political democracy.”

– “Economic Democracy”, Prout in a Nutshell Volume 4 Part 21, Proutist Economics

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