24 April, 2019

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A New Approach To Eradicate Poverty In Sri Lanka

By Vasantha Raja

Vasantha Raja

Vasantha Raja

Finance Minister Ravi Karunanayake’s mini-budget (29th) – with substantial offers to ordinary people – will be most welcome by many. Clearly, the minister must have taken the oncoming parliamentary election into account in designing the budget. However, occasional salary increases and random price-reduction of essential items are neither durable nor eliminate endemic poverty.

The new government’s 100-day program, in contrast, clearly has the potential to make a worthy contribution to Sri Lanka’s unfolding democratic revolution. But, remember, the existing constitution is a hotchpotch of uncoordinated patchwork; therefore, ad hoc changes will not be sufficient to do a solid job. Only a specially designed Constituent Assembly comprising experts and delegates from different communities, in my view, can fix the problem in the future.

Whatever the limitations facing the new administration, one must accept the fact that defeating Rajapaksas’ Mafia-regime electorally is a positive start.

The people of Sri Lanka seem to be already feeling jubilant and free, above all, fearless. This shows that the 8th of January marks something more than a ‘regime-change’; above all, an apparent ‘leap’ in mass consciousness. In other words, Rajapaksas’ ruthless regime seems to have unwittingly triggered a social backlash that has become irreversible. Perhaps, that’s the most important accomplishment.

Ravi Karu

*Finance Minister Ravi Karunanayake’s mini-budget – with substantial offers to ordinary people – will be most welcome by many. Clearly, the minister must have taken the oncoming parliamentary election into account in designing the budget.

But, the new administration should realize that the spreading of mass anger beyond democratic demands into areas of economic oppression may well be the next stage of Sri Lanka’s emerging social revolution. One must realize that the democratic revolution is inseparably linked to the economic emancipation of the masses.

The question is: Does Maithripala Sirisena’s capitalist administration have an answer to the ceaseless continuation of poverty in Sri Lanka? I don’t think so. For, profit-driven market economy all over the world has clearly shown that poverty is an unavoidable part of the system. Worsening rich-poor gap has become an established phenomenon on a world scale. Consequently ‘system-change’ becomes crucial to the elimination of poverty and, in order to do that, the whole approach to economic development will have to change. In other words, profit-driven market economics will have to be replaced with people-centred socialist economics.

The market economics is generally based on the so-called “trickle-down vision”, according to which the state’s task is to facilitate the best conditions for investors to make more and more profit, so that the capitalists’ wealth would eventually ‘trickle down’ to the lower classes. Thus, even infrastructure developments are carried out by capitalist states in line with the above-mentioned general vision, i.e. attracting investors.

However, in practice, the ‘trickle-down’ theory has demonstrably been falsified by facts. The truth is: rich-poor gap has been widening relentlessly. And, this truth is valid for Sri Lanka too. Therefore, if the economists want to honestly focus on people-centred development and eradicate poverty for good, they will have to think outside the box and develop a new vision. I like to briefly explain what a people-friendly, nature-friendly, government in Sri Lanka should do to address this problem:

The socio-economic infrastructure in a country is the foundation of its economy. Therefore, it is the key to eradicating poverty. National health, education, housing, water distribution, transport networks, communication, gas & electricity supply are all part of infrastructure.

In some countries, including Sri Lanka, aspects of health and education are available free of charge, though often these services are run in a half-hearted, disorganized, apathetic manner. Thus, many governments are clandestinely trying to privatise them for capitalist profit-seekers to exploit and serve the middle-class and rich layers’ interest in society.

A socialist government in Sri Lanka should totally change the existing approach, and focus on ‘rational planning’ to develop all aspects of infrastructure targeting ‘Common-Welfare’, not profit. This means: introducing free health, free education, free housing, free buses, free trains, free electricity, free gas, free water, free-phones and so on, thereby, the state assuming the role of providing the basic needs to all citizens without discrimination.

Obviously, a socialist administration should have the heights of the national economy – i.e. the banking system and the industrial capital – under its control, in order to realize these targets. Moreover, all infrastructure projects should become a public concern fully funded by the state. Nationwide creation of high quality hospitals, schools, housing projects, railways, road networks, and nationwide expansion of energy and water distribution – in brief, infrastructure development in general – should have one vision: ‘the creation of a healthy, educated, stress-free people’ to enjoy life while engaging in creative activity.

The socialist government will have the dialectical notion of ‘visionary planning’ as the guiding model for infrastructure development. Obviously, all administrations will have to systematically unleash billions of rupees to continuously fund the maintenance and development of infrastructure, in line with short-term, medium-term and long-term schemes. But, as I shall explain later, this will in turn produce an unprecedentedly productive society full of socially useful things (unlike the consumerist society of the market economy).

[Note that in this kind of welfare-societies – where uninterrupted continuation of infrastructure development becomes essential – the democratic structure of electing, changing and removing administrators will have to change dramatically. But, this is another issue to be considered separately.]

Let me come to the next point now: A gigantic effort of this proportion will invariably produce a massive labour force that earns a substantial amount of money for the work they do. And, since the working population does not have to spend their income on basic necessities, the workers’ spending power would increase immensely, and this will produce a massive demand for workers needs – mainly for food, furniture, clothes and so on. As a consequence, the country should bristle with economic activity where small businesses and farming/fishing communities flourish in trying to meet the workers’ demand.

Thus, in the new welfare-centred society, all citizens (workers, farmers and entrepreneurs) with a reasonable income can easily make a proportionate contribution (tax) to the state’s coffers, in order to maintain and improve the freely accessible services. Since none has to spend on basic needs, paying taxes will not be a burden at all for the citizens.

In advanced capitalist countries, there are many benefits and services available for the unemployed, disabled and so on. But, I argue, such models become a disincentive for people to work, particularly in low-pay jobs. But, with the model I have proposed, nothing of the sort will happen; because the free-services are available for everyone. Thus, a socialist ‘welfare-society’ will be an incentive for all healthy people to choose work in line with their own abilities and interests.

Also, since Sri Lanka is a small part of global capitalism and a socialist world-order is yet to replace the capitalist order, Sri Lanka will have no choice but to resort to ways of earning ‘dollars’. On this point, I suggest the state should focus on developing Sri Lanka’s tourist industry as its central foreign-exchange earner, on top of other well-known Sri Lankan exports.

Obviously, the ongoing tragic exodus of poor people leaving for the middle-east as slave-labourers should dramatically drop in the kind of welfare-society I visualize here. But, that’s a good thing. For, unlike the capitalist governments, a socialist administration will not have to depend on middle-east’s suffering domestic servants’ remittances as a source of foreign-exchange.

Consequently, a socialist government will tap the full potential of Sri Lanka’s scenic & cultural beauty as a magnet to attract foreign travellers as never before. I shall not go into details here of numerous incentives available to draw in tourists to see the only country in the world with a fully-fledged welfare society.

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Latest comments

  • 3
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    Vasantha Raja,

    First eradicate the politicians and we will eradicate poverty.

    If anyone wants to know why I say this, please ask me and I will explain.

    • 1
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      Vasantha Raja –

      RE: A New Approach To Eradicate Poverty In Sri Lanka

      Get Reid of the Medamulana Mahinda Rajapaksa white Elephants, and stick only to those that give economic returns.

      Make sure a $100 Million project is NOT marked up to $300 Million, with the politicians and their cronies pocketing $200 million with the people ultimately paying for it.

    • 1
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      it is like to heal the metastasized cancer you still need to heal the patients by encouraging them so that they can make their mind sets as the therapies could have the maixmum effect. So right at the moment revealing the way former Prez and his allies stayed away from taxes from their son s companies – but was telling all palatable to comfort the masses among those 57 voters – people should finally get it that they were caught by a man not second to Prabakaran. This particular man did everything to fill up his pocket rather than doing the most to the nation

    • 2
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      I know the fee they suggested for dualcitizenship is like 3000 Euro (500 000 rps) is very high but the sum they will get through that can invest for the uplifment of the nation. Our people s thinking pattern need its change. They are always upto criticize. TOday when the current regime made price reduction of fuel and milk power – the opposition has guts to say – they the rulers could go even further lower prices. In their days few weeks ago, they looted the national assets while going on telling fairy tales to the nation. WIth the made price reductions, all and sundry will agree with only knowledgeble people can handle country s economy. Buggers akin to the low mentalies of Rajapakshes can do nothing but abusing the people innocience for their future political gains.

    • 1
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      these are simply tangible changes.

      People will get to feel it clearly. Former idiotic regime looted the nation fully ignoring the day today lives of the general public. They had every chance to the due to the nation, but bunch of thieves thought only about their gains.

      However, now the opposition henchmen – biting sour grapes DO stress the other way around. The very same powerful ministers had not the least power to voice within the defeated coalition. Yesterday Reginold cooray had guts to say that they had no other choice. The few good ones

  • 1
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    Guess the US admin has been very benevolent with the regime change……manna from heaven. The catch being the thirding of the country into ethnic enclaves so the cash-and-carry can go as unhindered as ever. Clever boy UNP……clap-a-clap-a

  • 0
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    What is known as the trickle down effect to alleviate poverty and prevent social disintergration can be renamed as a form of beneficicient tyranny .it is a TRICK.
    It gives an opportunity for bigots and crooks to make hay and exploit race,and religion to commit every conceivable mischief anti-thetical to concepts like democracy and good governance.
    This is what has happened in SL over the years from it’s independence and it is still,taking place.

  • 0
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    If the ordinary poor people have to eat and live with atleast minimum food, the government should not tax any basic food item and the consumer should be able to buy them at a reasonable price for their consumption. Of course no need to subsidise any of them.

    However, the government needs to get revenue to maintain other welfare measures and government expenditure. These can be collected by way of taxes on petrol, tobacco and cigarettes, liquor, income tax from high income earners, corporations etc. Hereagain small entrepreneurs has to be taxed at a lower rate. Their can be Rs, 1/- or 2/- added to, petrol, diesel price and this money can be reserved for develpment and maintenance of roads.

    Most of all evaluation of costs of all projects must be carried out at 2 or 3 levels to ensure we select the best option, I.e. lower cost with quality assured. The country would not have been in so much of debt if thse evaluations had been done properly without allowing the moneynto go into each ones pockets. There has to be transparency in all these activities. When selection are completed for large
    projects these should be published in the newspapers for the informationof the public with necessary information.

  • 2
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    The budget by Minister. Ravi will appeal to the poor and the other classes certainly. Something for the poor man to celebrate as Kerosene prices are down to highlight a few here. Hope the future will be Rosy too instead of giving with one hand and take away from the other hand. Spring shoots are there Keep it up and look after the mass voted you in. Do not lavish the followers and the Bootlickers for their return affection like the last Regime did and succumb to it .That was Modaya work .
    Don’t forget to punish the criminals ,and murderers that is part of the present regimes job too. I believe in Karma what goes round comes round too.A thriving journalism is the gift of Democrasy which goes hand in hand.Gutter journalism should be eradicated from Democracy it becomes one sided.

  • 0
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    Do keep inflation under control production must be increased. Payment on a productivity basis is essential Different productivity indexes as well as Quality standards are a must..Profit sharing is a needed. Tax incentives for increases use of labour should be introduced. Government Institutes and private sector should have worker representatives on Boards. Legislature all ready in place fro maintaining productivity standards should be implemented. Diaspora should be encouraged to come back when they have technology that they can bring back.

    Most of all maximum funds should be collected that were corrupt. Public disclosures and heavy fines and not getting revenge should be the aim. This has to be collected before the remaining hundred days. Therefore an amnesty is essential. Money abroad must be brought back during the amnesty.

    Training institutions specially productivity Increase should be on more shifts. Patent rights and copyrights should be canceled where ever possible. Companies must share R and D costs and with government support release these for others use.

    The free use of all facilities should be used to spot light corruption. The Grass roots should be made to participate in decisions and reporting misdemer.

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    Technology must be shared.Arm twisting should be used to obtain video.s and photograph Factories and plantations. Government Research Institutions should freely provide technology to all. Free video;s must be allowed. Books and patent documents should be available to all with translations. Large scale translation is necessary re the latest technology. We must make use of retired foreign nationals to train us; Videos with slow motion analysis of work and trainers must be available to all. China should transfer technology to us.

  • 0
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    The changing nature of capitalism is not easy task; why is that productive forces in Globally had been massive transformations occurred over long periods of time covering several generations since 1648,that end of 30 War in Europe.

    The both of capitalist and socialist revolution an opened up new opportunities world for re-ordering societies, of its political-economy system , social dominant pattern and new technologies.

    In the each segment of elements of producing;
    One side disruptive and for many are disorienting;
    On the other side is produced massive in productivity has large increases in number of jobs, higher average incomes, that leads to less poverty, is unprecedented historic improvements in the quality of life in develop capitalist countries of sustainable amount of PEOPLE.

    Beside that development of capitalism, its past social revolutions 18th and 19thcentury most notably that the agricultural,industrial, services,science and technology revolution both led to dramatic changes in the way the majority people in the world spent their time.

    The radical change of 20th century, led by 1917 Russian Socialist Revolution leadership by CPSU, which led by Lenin and Stalin beginning Union of Soviet Socialist Republic of that century .
    Indeed while Chinese Revolution led by Mao Zedong Of CPC the first half of 20th century.

    Although that past and current changes are unprecedented in speed and its scale, the very pattern of mode of production and productive activities of all class of majority public, of course has undergone massive changes in human history in 21st century.

    History that thought us nevertheless in both cases ,the disappearances of old models was accompanied by emerging new ones that re-balance human life more easier and connected link between activity of production, which meeting of real needs of all classes in every modern society.

    The writer is easy going for FREE CAPITALISM, THAT WILL ISOLATED
    SRI LANKA FROM GLOBAL ORDER RUN BY US LED VESTED INTEREST.

    The writer is need to be wider and in-depth study of perceiving and thinking clearly about the pace of social, political-economy with, which we are now confronted by billions masses in our present world.

    The comment by Scott said ‘…Capitalism doesn’t necessarily lead towards DEMOCRACY AT ALL….’The one thing that you can say is that capitalism is going to relentlessly produce inequality of income, and eventually that is going to become incompatible with DEMOCRACY..’

  • 2
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    “A new approach to eradicate poverty in SL”??

    Karunanayake: First stop stealing
    Second return all the money you stole back to the people
    Third: Stop stealing by others.

    You can fool some people some time, but you can’t fool all the people all the time. LM<AO

    • 0
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      The appoinment of the new Finance Minister is My3s new strtaegy: SET A THIEF TO CATCH A THIEF. And by gad, it might work. Albeit with the thief in question teaming up with the thief/s he was set to catch. Remember Raj Rajaratnam and the Union Bank rip-offs? heh, heh…
      RIP RIp Hooray! (Pun of the Rs intended).

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