Get the government to fork out

The issue carries the presentation made by Professor Prabhat Patnaik at the UN on October 30, 2008 as a member of the task force on the present global financial crisis. Patnaik argues that the need of the hour is not just the injection of liquidity into the world economy but also in addition the injection of demand. “This can occur only through direct fiscal action by governments across the world. For activating governments for this, control over cross-border capital flows is essential, for otherwise governments will continue to remain prisoners to the caprices of globally-mobile speculative finance capital,” he says.

Noting that the sectors where government spending will go up will of course vary from country to country, he says the general objective of such spending must be the reversal of the squeeze on the living standards of the ordinary people everywhere in the world that has been a feature of the world economy in the last several years. “In India, China and other third world countries, in addition to welfare state measures, larger government expenditure has to be oriented towards a substantial increase in agricultural, especially foodgrains, output,” he advocates.

The new paradigm, he says, must entail a foodgrain-led growth strategy (on the basis of peasant agriculture), sustained through larger government spending towards this end, which simultaneously rids the world of both depression and financial and food crises.

Bailing out big business

An article by Rajya Sabha MP and CITU leader Tapan Sen questions the wisdom burdening the public exchequer to bail out private corporates in whose functions and business decisions it does not have any say.

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