ECONOMIC NOTES

A Striking Contrast

ONE of the immanent tendencies of capital is to commoditise every sphere of life; and under neoliberal capitalism where the immanent tendencies of capital are given full play, we find the sway of commoditisation reaching into new areas.

Some Disquieting Trends in the Budget

IT is clear by now that the figures provided in the 2019-20 budget are palpably unfounded. The budget has concealed the actual receipts and expenditures for 2018-19 even though these were available, because they show huge shortfalls compared to the budget estimates for that year. And all its estimates for 2019-20 are projections based on the revised estimates for 2018-19, which are close to the budget estimates for that year, rather than the much lower actuals. Hence the budget figures for the coming year cannot be taken seriously.

The Sluggish Growth in Tax Revenue

THE growth in tax revenue of the union government has slowed down perceptibly in the last two years. The growth (over the previous year) in total tax revenue accruing to the centre was 17 per cent in 2016-17; it slowed to 11 per cent in 2017-18, and further to a mere 8 per cent in 2018-19. Since this growth is in nominal terms, the growth in real terms has been even slower. In fact in 2018-19 the growth in real tax revenue could not have been more than about 3 per cent over the previous year, which is much less than the growth in the real GDP of the country.

The Debate over Inequality

THE debate over inequality has become hotter world-wide. While Trump had introduced substantial tax cuts for the rich in 2017, and Britain’s Boris Johnson, the front-runner to succeed Teresa May, has promised to do the same if he becomes prime minister, there are strong proposals for taxing the rich which have also been mooted. Bernie Sanders had such a proposal for the US during the time that he was seeking the presidential nomination of the Democratic Party.

India’s GDP Growth in the Recent Period

THE “Gross Domestic Product” is a concept rooted in an epistemic position which is intrinsically incapable of recognising the existence of a “surplus” in society. A simple example will make this clear. Suppose we have an agrarian economy in which 100 peasants produce 100 units of food; and suppose 50 of these are taken by an overlord through taxes, for consumption by his family and hangers-on. These 50 units will be readily recognised as constituting a “surplus” out of the total output of 100. But the concept of GDP would not recognise this.

Official Figures Confirm Slowdown

THE official Gross Domestic Product data have just been released, which show that the growth rate in the fourth quarter of 2018-19 (January-March) over the fourth quarter of 2017-18 was 5.8 per cent. This is the lowest quarterly growth rate in five years. The media coverage of this event however has only been concerned with India’s rivalry with China, i.e., with the fact that India has lost the position of being the fastest-growing economy in the world to China.

The Global Shift to the Right

WE often miss this aspect in our discussions, but Modi’s re-election is part of a global Right-ward shift that is taking place. Netanyahu got re-elected in Israel. Erdogan got massively re-elected in Turkey. The Conservative government came back to power in Australia against all predictions to the contrary.

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