{"id":203735,"date":"2022-09-06T18:14:15","date_gmt":"2022-09-06T12:44:15","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=203735"},"modified":"2022-09-06T18:23:37","modified_gmt":"2022-09-06T12:53:37","slug":"gorbachev-macro-economics-and-gandhi","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/gorbachev-macro-economics-and-gandhi\/","title":{"rendered":"Gorbachev, macro-economics, and Gandhi"},"content":{"rendered":"\n

Source<\/strong>: The post is based on the article\u00a0\u201cGorbachev, macro-economics, and Gandhi<\/strong>\u201d<\/strong> published in The Hindu <\/strong>on\u00a06th<\/sup>\u00a0September 2022<\/strong>.<\/p>\n

Syllabus<\/strong>: GS 3 \u2013 Indian Economy \u2013 Growth and development.<\/p>\n

Relevance<\/strong>: About the capitalist model and its alternative.<\/p>\n

News<\/strong>: Recently, Mikhail Gorbachev passed away. He has been for his role in ending the ideological conflict between communism and capitalism.<\/p>\n

About Mikhail Gorbachev’s political and economic decisions<\/h5>\n

Economic policy<\/strong>: Gorbachev favoured a slow transition to a \u201cmixed economy\u201d like the Indian model and had even approached Rajiv Gandhi for advice.<\/p>\n

With his concepts of perestroika and glasnost, Gorbachev wanted to save common citizens from being oppressed by powerful people.<\/p>\n

Political decisions<\/strong>: He also brought down the Iron Curtain and ended the Cold War between the North Atlantic Treaty Organization (NATO) and the Soviet Union.<\/p>\n

Gorbachev also helped to bring the world back from the nuclear precipice.<\/p>\n\n\n\n
Read more: Why Rajiv Gandhi hailed Mikhail Gorbachev as \u2018crusader of peace\u2019<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
How did Russia evolve after Mikhail Gorbachev’s Presidency?<\/h5>\n

Boris Yeltsin<\/strong>: He took power after Gorbachev. During his regime, \u201cbig bang\u201d capitalisation was imposed on Russia by U.S. economists. Instead of the Indian model, the \u201cWashington economics\u201d model prevailed.<\/p>\n

Note<\/strong>: After 1991, India itself opened up its economy to the US model.<\/p>\n

Vladimir Putin<\/strong>: Under him, Russia again moves towards authoritarianism.<\/p>\n

Is the capitalist model the best?<\/h5>\n

No, overall life expectancy is a good measure of the well-being of a nation\u2019s citizens. This is because, when all citizens are well-nourished when public health systems function well, and when violence in society is low, an average person lives longer.<\/p>\n

International comparisons reveal that GDP per capita is an insufficient contributor to longevity. Many countries with substantially lower incomes outperform the U.S. in life expectancy.<\/p>\n

For example, Cuba is one place above the U.S. in longevity tables even though its income per capita is just 14% of U.S. incomes.<\/p>\n

What is the impact on Russia due to the capitalist model?<\/h5>\n

The big bang capitalist reforms of the Russian economy in 1991 and 1994, life expectancy fell from 64 to 57 years. Many Russian deaths were caused by suicides, alcohol poisoning, homicides, and heart attacks brought upon by despair with joblessness and hopelessness, created by wholesale privatisation of the economy and disruption of social safety nets.<\/p>\n

What are the basis of the capitalist model, and what are the challenges?<\/h5>\n

It is founded on two fundamental ideas.<\/p>\n

The ideology of \u201cproperty rights\u201d outdoing human rights<\/strong><\/h6>\n

In this, whosoever owns more shares in a property must have a greater say. Thus, one dollar owned gives one vote in governance, and a million dollars, one million votes.<\/p>\n

This is visible by the a)<\/strong> Creation of international tribunals which adjudicate disputes between foreign investors in countries and the governments (representing the interests of millions and billions of people) of those countries, b)<\/strong> Global trade rules, and national financial and trade regulations also favour the needs of financial investors, making it easier for them to enter and exit. But the governments stopping human migrants from searching for better opportunities across national borders.<\/p>\n

On the other hand, the democratic principle of \u201chuman rights\u201d requires that every human being, black or white, or whether billionaire or pauper, has an equal vote in governance.<\/p>\n\n\n\n
Read more: Humanity matters, capitalism needs an upgrade<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
Hardin\u2019s \u201cTragedy of the Commons\u201d<\/strong><\/h6>\n

It says that communities cannot manage shared resources; therefore, a common property must be privatised for its protection. When a public resource is privatised, those who already have wealth can buy it. Those with more wealth will win and become even wealthier. Thus, inequalities will increase.<\/p>\n

What is an alternative to the capitalist model India should follow?<\/h5>\n

Follow Gandhi\u2019s ethical economics<\/strong>: Concepts of free trade, financial freedom, and privatisation, promoted by macroeconomists, are not good solutions for India\u2019s billion citizens struggling for resilience in their lives.<\/p>\n

India\u2019s economic governance must be guided by Mahatma Gandhi\u2019s calculus, with principles of human rights and community management, to realise the promise of our commons, and provide \u201cpoorna swaraj\u201d to all citizens.<\/p>\n\n\n\n
Read more: It\u2019s time for the world to reform capitalism from within<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

Source: The post is based on the article\u00a0\u201cGorbachev, macro-economics, and Gandhi\u201d published in The Hindu on\u00a06th\u00a0September 2022. Syllabus: GS 3 \u2013 Indian Economy \u2013 Growth and development. Relevance: About the capitalist model and its alternative. News: Recently, Mikhail Gorbachev passed away. He has been for his role in ending the ideological conflict between communism and… Continue reading Gorbachev, macro-economics, and Gandhi<\/span><\/a><\/p>\n","protected":false},"author":10311,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[216,10498],"class_list":["post-203735","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-3","tag-the-hindu","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":1700770933,"cached_date":1704886915},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/203735","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10311"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=203735"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/203735\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=203735"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=203735"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=203735"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}