For Democracy

I’m accused of being a capitalist – a crazy one at that. Not that there’s anything sane about any of them. And not that I’m a true capitalist either. I have a problem with just one idea –  ”From each according to his ability, to each according to his need”.

Don’t get me wrong, I am not challenging Marx’s wisdom. Nor am I claiming he was as shaken in the head as the capitalists. But I do have a bone to pick with those who want to see his idea put to practice today. And here’s why…

You see, the world as we see it today works on incentives. I’m not saying it’s right. I’m not saying it’s wrong. It just is. And the sooner we accept it, the better. A Professor at a local college conducted a great experiment to prove this. Him and his students were arguing about the same Marxian school of thought I write about. So, in an analogy, he said, let’s average out your grades, and let everyone get this average grade. So everyone got a B. Those who didn’t study were happy. Those who did had to face disappointment. So in the next test, those who didn’t study earlier now studied even lesser – they knew there was someone to back them up. Those who did study earlier, reduced their effort. There simply wasn’t enough incentive. The class performance dropped, and everyone got a C. And it didn’t stop here. At one point, the entire class failed. Sure, there were those who studied for the love of the subject. But they were too few in number to keep the averages up. And this is one flaw would hold in the Marxian argument. There are too few of us who work for the love of the job.

When Marx made his iconic statement, he was talking about a society where technology would be so advanced that there will minimal need for labor. And labor would be intellectually stimulating, challenging, fulfilling. A eutopia of this sort sounds great. But we’re not quite there yet. We’re not even close.

So incentives are a necessity in the world today. But that does not justify brutal incentivization either. When Ayn Rand talks about rewarding effort and only effort, she again assumes a very egalitarian society. That’s not true. We all start at very different points in our financial and social arrangement. Someone who is worse off in the beginning would have to work much harder than you and me to accomplish the same goals. And having seen poverty at close quarters, I can assure you this would be a disaster. Take the case of an unskilled laborer. He works hard every day, day and night, and in the end, earns just enough to get by. No significant increase in wages, no promotions, no development. Take your own example for a contrast. Let’s say you work just as hard as the daily wage worker. But you have education by your side. You use your mind along with your physical strength. You grow your skill, and with this growth comes professional, personal and financial development. You have avenues for growth, simply because your parents could afford to send you to school.

You may argue that this is sheer luck, and that you’re entitled to make the best use of what you have. But this approach won’t work to your benefit in the long run either. What this view would end up doing is, it would widen the gap between the well to do and the poor. And this is bad not just for the poor, but for you as well. Kruger and his colleagues did a detailed analysis here. They found that as the gap begins to increase, the income of the entire economy falls. Growth rates fall, consumptions fall, wealth falls. Even the well to do now see that their standard of living is declining – so much so, that the countries with the largest inequality often have the lowest standard of living.

Believe it or not, but the poorer sections, or the lower middle class, is the highest consumer. And your consumption does not increase in proportion to your wealth. So when you get richer, a large portion of your money is going to be stored away. This money is not working. It’s not contributing to growth – neither the society’s nor yours. The society is at a disadvantage, and so are you.

Brutal capitalism is not the solution. We need someone to stabilize, to ensure a framework where the incentivization found abundantly in capitalism would work. We need to ensure that there is enough opportunity for this incentivization, and that everyone gets a chance to this opportunity. We need a stabilizing, allocative and efficient government structure. A structure that, rather than removing incentivization, promotes equal incentivization for all under its purview. Such a structure would allow for mankind’s potential to truly blossom. It would make opportunities available for all, and then reward the one making the best use of the opportunity.

A democratic government is very well equipped to serve this end. To quote Amartya Sen, ‘Democracy is not a luxury that can wait the arrival of prosperity’. Rather, it is born out of the need and desire for prosperity, the desire for development, the desire to be heard and to be rewarded for effort. Given adequate representation, a democracy can ensure that the needs of most are met with priority. It can ensure that its constituents get a platform on which to build their aspirations. It can ensure collective prosperity through the prosperity of the individual. It has the potential to be truly egalitarian in representation and opportunity. It is, I believe, the perfect form of government. Yet, it needs to be made efficient. The kinks and flaws need to be ironed out. It needs to be molded by the voice of its own people. It needs awareness. It needs education and intellectual participation. It must be shaped through the constant involvement of its own people. Through collective effort, democracy can potentially emerge in its purest form, and bestow upon its subjects individual as well as collective accomplishment, development and prosperity.


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