I was reading Mr Subramanian Swamy's book - Reset. I have always been intrigued with his take on the economy. Sometimes radical as a thought which for obvious reasons may not have many takers.
I however got extremely facinated by one aspect in the book, which he has not spoken about much in public - "Economy based on Integral Humanism"
He says that economy is a subsystem of nation and not other way round (true). He says that a successfull economy can only be outcome of successfull recognition of life as integral part of system and policies have to recognise the interlinkages and positive complimentaries (explained later) for the economic wheel to run progressively.
Nations growth has to recognise and accept diverse nature of various people and conflicts, and economy has to respect that where man's personality & freedom is respected. For eg- Individuals have to be incentivised to be part of economic growth like tax incentive or aboltion instead of high tax rates just becuase they earn more. For eg the tax collection as per the integral humanism theory will grow if people are happy to partake in the economic growth instead of coercion (respecting diverse nature and attitudes)
He also proved it through stats where state's coercive factor is indirectly proportional to economic growth of tax collection.
He adds that global teachings of economy cannot work for every nation, specially a diverse country like India. India has to find its own chitti(soul) and make its own unique economy theorms based on mutual complimentaries - eg the demonatisation though a great initiative overlooked that fact that there were genuine housewives there who had saved a lot of cash without knowledge of their husbands one rupee at a time and many (I know that from experience) had strained relations with their spouses once they found out about this hidden stash. You know how housewives save for rainy day, for their daughters marriage, for that once in a while binge without telling their spouse.
But the Chitti eg can be explained in corporate language for the larger good as - eg we shouldnt allow a polluting factory (just because we have to make more phones or goods) in middle of civilisation or polluting vehicles as a growth of economy in that sector, as it also harms others by way of poor air & health etc. But we can allow a school or a garment factory as it benefits both the maker and local residents. Similarly we should move towards nuclear power plants or similar.
He add that household savings is one of the most important aspects of GDP growth and will have to grow along with FDI growth which is on decline. While lending rates should be low, FD rates should be high (don't know how that is possible). He also says (which makes sense) to print notes to fund infrastructure & labour wages (China did that).
Other reforms suggested by him is de-salination plants on coastal line and water grid for all agriculture. Exploiting thorium reserves and becoming self sufficient in electricity.
Would love to read more from Mr Swamy where I would request him to decipher his technical knowledge to a laymen reading.
Dr Akash Rajpal