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New Prout Book Launch


Growing a New Economy: Beyond Crisis Capitalism and Environmental Destruction
by Roar Bjonnes and Caroline Hargreaves

The most comprehensive analysis of the global crisis and Prout solutions hits the stands (and the Prout Convention) this July!

 

INSIDE THIS ISSUE

     
     Proutists in Norway organize second debate on the topic of immigration.

                  
                                 


Girl Proutists in West Bengal hand over demands for women rights to District Magistrate.                                          



In Cebu, Maharlika, new cooperatives give hope to residents of marginalized community.
 

German Prout party runs in state elections for first time.





Samaja workers in Vidarbha region in India push for independent statehood.





Strategic planning seminar gives Proutists in the US new action plans moving forward.
EU's challenges today stem from the economic structures embedded in its Four Freedoms.

GLOBAL NEWS

Norwegians Debate Refugee Problem

Divya Jyoti

 
Proutists in Norway held another seminar on the refugee problem, following up the seminar in February which focused on NATO's responsibility for creating the catastrophe in the Middle East. (See the previous issue of Global Impact). Both seminars were held at the University of Oslo.
 
This second seminar focused on how we should practically deal with the refugee problems internally, inside Norway. The organizers were Bevegelsen for Sosialisme (with Divya Jyoti and Anukul in the Working Committee), and Fritt Norden. Three very renowned speakers gave introductions. They were professors Gunnar Skirbekk (upper left photo) and Ottar Brox (lower left photo), and Berit Hagen Agøy, Secretary General in Mellomkirkelig Råd (Ecumenical Council).

Divya Jyoti facilitated the debate. The discussion turned very constructive, focusing on solutions for addressing the double challenges of handling the flood of job seekers from Eastern Europe who were creating mafia conditions in construction business as well as the new wave of asylum seekers and working immigrants from the Middle East and North Africa.
 
The Proutists maintained that it was absolutely essential for Norway to regain national control over the labor market by getting out of the EØS (European Economic Area), which share common economic policies with the immoral capitalists in the EU.
 
What we did not get enough time to debate, which Secretary General Agøy called "the Elephant in the Room", was the huge number of anti-social Muslims in our society. How to deal with this problem will be a topic at the coming Prout Convention in July.

Proutist Party in Germany Contested State Election


The Proutist party MENSCHLICHE WELT successfully contested in two constituencies in the state election of Baden-Württemberg. Through the election campaign, hundreds of thousands of people came to know our Proutist platform and solutions. We received state TV, radio and print media coverage (see here in German). Government websites portrait us. We put up election posters and had information booths in towns. Our election manifesto was very well received by the public.  Out of 22 parties, we ranked number 15 in votes received.

MENSCHLICHE WELT is perhaps the first Proutist party outside of India having contested its first election. We are now in the initial stage of preparing for the next state election in autumn in Berlin. We are also already preparing for the national elections in 2017. 

If you would like to know more about our work or support us, please email us at kontakt@menschlichewelt.de

Girls Proutist Movement in Uttar Dinajpur

 
On June 13th, the Girls Proutist unit of Uttar Dinajpur District of West Bengal, India, submitted a memorandum to the DM (District Magistrate) regarding ten women issues. They included: free education for all women (in many places the literacy of women is half that of men), economic security and empowerment for women at all levels, ending the all-round exploitation of women in the cultural, social, economic and religious spheres, police action against all forms of dowry exploitation, banning the encouragement of vulgar dress by the corporate media, respectful rehabilitation of prostitutes and the closing of their prisons, and finally, ensuring real justice for rape victims in the district and higher courts.
 
In addition, a procession was lead in protest against the common abuses of women that are part of daily life. The protest lasted for 3 hours and public meetings were organized in different corners of the Raiganj market. About 200 Girls Proutist attended the program. On this occasion, a District Committee was also formed. The program was organized by Avadhutika Ananda Advaeta Acarya. This is the first of many such programs to be carried out by Girls Proutists.

Vidarbha Movement Turns Toward Statehood


    The Vidarbha unit of PBI met to plan the movement for separate statehood. The current drought has shown the people of Vidarbha that despite having a Chief Minister from Vidarbha, the region will not get even basic humanitarian aid, let alone justice, under the rule of Maharashtra.
 
     First, Acarya Santos’ananda Avadhuta addressed the gathering. He explained that the fight to create a mass movement for forcing the authorities to grant statehood to Vidarbha would be a tremendous undertaking. And the struggle to build a mass movement for obtaining economic swaraj (independence) for Vidarbha would be far more challenging. Nevertheless, it is a task that must be undertake because without removing the outside exploiters from Vidarbha, mere political freedom in the form of a separate state would be empty. The task of Sampurna Swaraj for Vidarbha requires a revolutionary transformation among the people of Vidarbha and especially of the cadre of PBI. In this regard, Acarya Santos’ananda explained the changes in one's personal lifestyle and in one's spiritual life that would be required for this transformation.
 
    Then, Madhukar Nistane gave a rousing speech, outlining the history of the exploitation of Vidarbha. He forthrightly stated that the suffering of Vidarbha is going to increase with the onslaught of the drought and the general downturn in the economy. If Vidarbha was a separate state with basic economic independence like in Kashmir, Nagaland and Mizoram, then there would be some chance to minimize the suffering and plan for a new economy. However, the longer there is delay in attaining Artha Azadi (economic freedom) the more that people will have to suffer. He gave a call to the participants to develop a do-or-die spirit towards attaining separate statehood for Vidarbha.

Building Cooperatives in Cebu

Gomatii


In Cebu, Maharlika, Proutists have initiated a project in a medium-size squatters’ community, called GVAL – relatively near the center of the city. The aim is to transform this poor, urban community of about 160 people into a Proutistic model.

For this purpose, the following works have begun:
1) Education of community members about Prout: Some of the community leaders have been engaged in discussions about decentralized planning, sustainability, collective decision making and the importance of personal development. When real concrete results are manifesting, when clear steps have been taken toward improving their living standards, then the element of education will become much more emphasized.

2) Establishing a furniture-making cooperative: Some skilled craftsmen of GVAL have taken training at Cebu’s well known Eco-House of Sir Nestor Archival to learn how to produce commercially marketable products, such as bench tables and smaller products. Fund raising is being done to set up a small factory.


3) Cooperative for renting solar food carts: Sir Archival, a Prout collaborator, invented a type of bicycle-operated solar food cart and is financing their construction. Each bicycle cart has solar energy a) to run a cooking stove to preparing hot healthy products, like vegetarian siomai, for sale to public and b) to power a small refrigerator to keep raw ingredients and healthy drinks. We are presently preparing the products and the infrastructure to form a cooperative for renting out the carts to community members for their collective daily income.

A Prout Spring in NY Sector

 
As springtime brings new growth and energy to the earth, Proutists in NY sector experienced their own re-energizing this May at Ananda Girisuta (Prama Institute), in Asheville, NC. During the weekend of May 6-8, thirty Proutists from NY sector came to Ananda Giris’uta (Prama Institute), in Asheville, North Carolina, to participate in a weekend of discussion and planning. The event was planned by a small committee of Proutists who were searching for a way to improve Prout work in the sector.  
 
During the weekend, participants first listened to short presentations on topics related to these questions and then divided themselves into three work groups. Throughout the rest of the weekend, these groups brainstormed on possible programs and activities and finally designed practical action plans for implementation. During the final session, all three groups represented their plans and discussed ways to coordinate and collaborate among each other.
 
Briefly, here are to goals of each group:
Group 1 – the creation and maintenance of a Prout website geared towards the culture and issues of the sector
Group 2 – the formation of a Prout Policy Research Institute for developing policy papers that would be used in advocacy efforts to affect the political discourse in the sector
Group 3 – building a strong, internal Prout organization through active, legal structures and regular Prout retreats and training opportunities
 
Everyone was very inspired and generally felt that the weekend had created a new wave of Prout work in the sector. They decided to use BaseCamp software to keep in touch and continue their work for implementing their action plans. There was also a general consensus for organizing another similar planning seminar in a year’s time, that would also include a public program as well as workshops on Prout topics to deepen everyone’s understanding of the ideology.

COMMENTARIES AND ANALYSIS

Block Level Planning - a Haitian Perspective


Daniel Isner


“For the decentralization of economic power, the devolution of planning is a necessary precondition.”  (Sarkar, P.R Inter-Block and Intra-block Planning, 1986)
 
Increasingly it has become evident that the social and economic systems we have been refining and promoting around the globe for decades have been failing to address the intrinsic needs of people.  From their day-to-day basic needs to more subtle, emotional needs, there seems to be a fundamental disconnect between the top-heavy development strategies of governmental and non-governmental agencies and the actual reality lived by vulnerable communities all over the globe.  The devastating results of this systemic failure to connect those who struggle to survive on $1 USD per day with solutions to their problems has promoted dependence on foreign aid, corruption, nepotism, feelings of distrust, and lack of initiative.
 
In a decentralized, balanced economy, the fundamental blocks (i.e. a small area that may encompass a town, a part of a larger city, or a rural area) of economic planning are established, according to Indian thinker P. R. Sarkar, through the formation of social organization units for the purpose of block level planning.  Sarkar goes on to suggest that once the physical needs of people are achieved in a balanced way, equilibrium on the emotional, psychic and spiritual levels can be easier to attain. 
 
In Proutist Economics (1981), Sarkar calls for current political boundaries to be reorganized to take into account the following factors:  the physical features of the area, the socio-economic requirements and problems of the people, and the different physical-psychic aspirations of the people.  Planning in these types of areas is beneficial for ensuring that (1) major and minor problems in the area are properly understood, (2) local leadership emerges to solve problems according to their felt needs and priorities, and (3) the planning process is quick and effective.  Sarkar was optimistic that block level planning can solve local unemployment, enhance people’s purchasing capacity, and establish a solid base for a balanced economy. 
 
 

An Emerging Model


Defined by the red mountains embracing it, the hot water springs running through its barren landscape, subsistence gardens and ocean views, the village of Source Chaudes is at the center of Haiti’s thriving Self Help Group (SHG) movement.  Beginning with a couple dozen groups in 2011, AMURT-Haiti and the Haitian organization it helped form, LOCAL (Local Capacity Alliance), have since facilitated the formation of 150 groups with 3,000 women in Communes Anse Rouge and Terre Neuve.  This isolated and impoverished area is in the northwest corner of Haiti which is commonly characterized by failed development schemes, high level of food insecurity, and ongoing environmental degradation. 
 
 During my first visit to the area in 2013, I witnessed a scene that inspired me beyond measure.  Under a large thatch awning attached to a little cob cottage, around twenty women assembled for their weekly meeting. I sensed in them an air of confidence and purpose; something unlike any gathering I had experienced in all my years living and working with farmers associations in West Africa.  Even before the meeting started, I was convinced that each woman knew exactly what she was doing and why.  After a moment of silence and a song, the women collectively began to chant the root causes of disempowerment and poverty - denial of choices/rights/opportunities, discrimination, disparity, domination, displacement, dehumanization, etc.  By the end of this acknowledgment exercise, these seemingly insurmountable realities no longer held power over these determined women.  Then, in perfect unison, the group reverberated their core, binding principles to further reinforce that which brings them together each week.  The louder they chanted, the more the sweat, tears and determination flowed.  It is then that a realization dawn on me - these women are warriors on the frontlines of a war on poverty, fighting the first battle to reestablish their rights and gain dignity as the key participants in this grassroots process.
 
The SHG group quickly got down to business and listed the agenda points that would follow the financial transaction period.  Then, taking out their individual cash ledgers, each member made her weekly contribution to the group’s general fund and the social fund, an extra one they created for the purpose of assisting families in dire need.  The group then listened to two women aiming to receive that week’s micro loan.  They discussed both the pros and potential cons of the proposals and, in the end, collectively decided to award both loans.  With SHG principles as the binding element, each group collectively make decisions about their own group’s interest rate, meeting times and other operational specifics.  As groups realize that interest and the cash penalties following a loan default get funneled right back into their group’s hands, it is not uncommon for them to set up 25% interest rates. 
 
With the financial procedures now completed, the group shifted its focus onto the community’s social and development issues.   Solutions to challenges in the community were talked over and time-bound resolutions were made, complete with a signed list of delegated responsibilities for each point.  I sat in awe, witnessing the most tangible grassroots, democratic community-building structure I have experienced to date taking place in the last place I would expect to find one. 
 

Just the Beginning

 
In 2016, the SHG movement in Haiti’s Artibonite Department is well established and has expanded to include men as well as associations which focus exclusively on specific production sectors, such as salt and agriculture.  As the community begins to raise its consciousness due to this new self-organization model, a wave of new groups often form organically, including both young and old residents of far-flung impoverished communities.  Identifying the block and establishing new groups is a participatory process involving surveys and reflection which focuses first on the most vulnerable households by mapping their needs and current economic status. This process draws from successful models operating abroad, such as in the Indian state of Andhra Pradesh. The state-sponsored SHG movement there has effectively used this methodology to reduce the rural poverty rate from 26% in 1983 to 11% in 1999 (Planning Commission, Government of India, 2000).  According to Demeter Russafov, Country Director for AMURT-Haiti,

“the SHG model is the lowest input and highest output sustainable project with significant positive ripple effects transforming the community – decreasing gender discrimination, bringing harmony to the community fabric, building leadership and autonomy, and creating a foundation for participatory decision-making at the grassroots level.” 
 
As the SHG structure increases its complexity, it forms higher level representative bodies called associations. These multi-block collectives confront socio-economic challenges head on not only by initiating robust peer to peer lending activities relying on self-generated credit, but also engaging in direct action plans for improving their community’s overall quality of life.  The 150 SHGs now are in the process of forming 10 associations which will serve as the base for a higher-level decision-making body, a federation. The mandate of these associations is to assist the block-level SHGs with capacity building, leadership, literacy, conflict resolution, financial audits, etc.  Leadership at both the association and block level is rotational, allowing for each member to expand his/her skill sets.  Currently, facilitators provided by LOCAL are working to strengthen this association level, while paving the way for the formation of the nation’s first SHG federation. 
 
The functions of the federation can be grouped into four categories: 1) institutional development, 2) financial intermediation, 3) livelihoods enhancement or business development services and 4) social intermediation (Salomo, Rao & Kumar, 2012). In practical terms, federations hold the ability to organize community development initiatives, raise funds, rally support, and advocate for meaningful representation at the regional and national levels.  For example, if a crucial road falls into disrepair, federations can call on individual group members to set aside an extra dollar during a particular month, and due to their large membership base, can quickly rally funds for its repair. This is precisely what Sarkar refers to as inter-block planning which integrates socio-economic development between a few adjoining blocks through mutual coordination and cooperation (Sarkar, P.R Inter-Block and Intra-block Planning, 1986).
 

Coordinated Efforts

 
The block level represents the necessary foundation upon which community development initiatives can grow.  LOCAL-Haiti is actively engaged in a number of strategic endeavors in the Artibonite Department including 1) Integrated Disaster Risk Reduction involving watershed protection, reforestation, and soil conservation, 2) agroforestry training, accompaniment and infrastructure, 3) social entrepreneurship models particularly in the domain of salt production, and their relationship to integrated rural development.  All of these programs are coordinated and implemented through the SHG methodologies. 
 
The results have been promising, to say the least, and have garnered a growing attention and recognition for its bottom-up gender-focused approach.  In 2004, LOCAL was awarded the annual distinction for Emergent Social Entrepreneurship model by the Digicel Foundation, a prestigious recognition for innovative business initiatives.  Yet perhaps the greatest achievement of this approach is that every participant develops an active voice and tangible stake in the development process.  A personal and collective sense of purpose naturally emerges in this highly participatory and self-affirming process. 
 
 
 
A newly-found autonomy and sense of self-worth permeated the atmosphere of the 2014 annual Women’s Day gathering which I attended.  Every year, up to a thousand women SHG members walk for hours to come together, share their stories and songs, acknowledge their common successes and struggles, and celebrate the symbolic meaning of this special occasion.  I could experience the excitement and joy of these women and felt confident that these women were well on their way towards socio-economic emancipation.  Armed with a unified sense of purpose, they had transitioned from vulnerable and isolated individuals into warriors ready to defy all obstacles in their fight for a new Haiti.

Daniel Isner is an agroforester, wellness educator and father.  He currently works alongside a network of rural, purpose based communities in Tennessee, Haiti, Ghana and Burkina Faso, who are engaged in the advancement of agroforestry, grassroots community building and social entrepreneurship.  

The Four Freedoms of the EU


Excerpt from Growing a New Economy: Beyond Crisis Capitalism and Environmental Destruction, by Roar Bjonnes and Caroline Hargreaves

The European Union (EU) was formally created in 1993 as a result of the Maastricht Treaty. The EU is an economic and political union of 28 member states operating through a system of supranational institutions and intergovernmental negotiated decisions by the member states. Institutions of the EU include the European Commission, the Council of the European Union, the European Council, the Court of Justice of the European Union, the European Central Bank, the Court of Auditors, and the European Parliament. The European Parliament is elected every five years by EU citizens in Brussels, EUs “capital city.” This parliamentary city is also home to thousands of bureaucrats lobbying politicians to enact their economic dreams and policies. Each of the largest multinational companies has upwards of 200 lobbyists representing them. 

The Maastricht Treaty established the European Union in 1993. The latest major amendment to the constitution of the EU, the Treaty of Lisbon, took place in 2009. The EU has developed a single economic market through a standardized system of laws that apply in all member states. Within the Schengen Area (which includes 22 EU and 4 non-EU states) passport controls have been abolished. EU policies aim to ensure the free movement of people, goods, services, and capital, enact legislation in justice and home affairs, and maintain common policies on trade, agriculture, fisheries, and regional development.

 The formation of the EU was a logical extension of the EEC, and was an attempt to draw European countries even closer together into one common market. The European Union is a far-reaching concept, which for the first time in human history has united 500 million people from 27 different countries without a centralized state behind it.

The economic foundation of the EU, as established in the Maastricht Treaty, is the Four Freedoms. These are not the same four freedoms envisioned by Franklin Roosevelt--freedom of speech; freedom of worship; freedom from want; and freedom from fear. While Roosevelt’s freedoms concerned the rights of the individual, the EU freedoms were the commercial freedoms of an open market: the free movement of goods, services, persons and capital.

With the four freedoms of the EU, most tools that individual governments traditionally have had to influence their economies were removed, and the whole of Europe turned into a large experiment in free market capitalism. While the original vision might partly have been to preserve peace in Europe, the foundation of the EU has more to do with a certain economic worldview than that of promoting peace—the worldview of neo-liberalism, a deregulated economy of unlimited competition. The four freedoms of the EU were designed to forward a neo-liberal economy in all its member countries coupled with democratic but centralized government regulations from the European Parliament in Brussels and monetary regulations from the European Central Bank. 

As expressed earlier in the book, so called free market capitalism has been of most economic benefit to the developed nations, as well as the largest corporations. At the same time, it has often reduced the ability of less developed countries and communities to catch up and develop their industries. This leads to uneven development, where rich countries and regions prosper and poorer areas often fall behind, a situation which has also become a reality in present day EU. Indeed, free markets do not automatically bring about freedom from want, the fourth of Roosevelt’s freedoms. Yet, this is the gospel perpetrated by free market economists and politicians.

Another favorite myth of free market neo-liberalists is that open and free markets are always better for business and for people. Here are a few reasons why this is not always so: 
  • Free markets favor large companies; those with the most money and power will generally outcompete smaller companies. Hence, free trade reduces freedom of choice for smaller companies and people in general—they are forced to compete within an economic environment fixed by the larger companies.
  • Free markets do not favor investments in smaller businesses, such as farms and specialized industry in poor areas because they are not competitive. For the growth and sustainability of a poor area, however, investing in smaller, local businesses, even if they make a loss for several years, is, in the long run, good for society and the economy. 
  • Free markets do not allow less developed areas to protect themselves against competition from larger companies from other countries.
  • Free markets often create an economic “race toward the bottom.” Examples in Europe are an increase in zero-hour companies such as UK’s Sport Direct, where employees do not have fixed salaries, don’t know how many hours they can work, and have no health benefits. 
  • Free movement of labor between rich and poor areas can be greatly profitable for corporations but can also create a shadow economy of low wages, illegal employees, brain drain, and economic and increased human stresses within the social welfare system,
  • Free markets do not recognize that certain state-owned companies, such as in the alternative energy, health, and oil sectors, can be better for the stability of the local economy and for the environment.

Ending Unemployment

By Hiranmaya and Jagatbandhu

Unemployment is a troubling and troubled economic indicator. It is troubling because we know that without regular income, individuals struggle, families suffer, and communities deteriorate. Wages and salaries are the main source of our sustenance and wealth building. Our jobs also provide us with meaningful activity, a sense of achievement, and self-worth.

Data from the International Labour Organization (ILO) shows that unemployment globally has reached over 200 million people (above 8%). In at least a dozen countries a quarter or more of the labor force is out of work.

Unemployment is a troubled statistic because there is a lot that it doesn’t tell us. The rate itself is frequently calculated as the percentage of those employed divided by the full labor force (the number of adults fully employed plus those actively seeking employment). People not actively seeking employment or “drop-outs” from the labor force for diverse reasons are missing from the statistic, as are the long-termed unemployed. In particular, “discouraged workers” those who sought work for months or years and finally gave up the search are omitted. The measure does not include those who do not get paid for what they do, like parents or family members who are care-givers. The rate also doesn’t capture whether those employed are actually under-employed, such as the over-qualified or part-time workers, as well as those who seek work through non-traditional
channels. And most importantly, it doesn’t indicate whether those who are employed earn enough to meet their basic needs. As Heather Long of CNNMoney[1] points out, achieving the low unemployment rate of 4.9% recently in the USA was no longer a cause of celebration when many workers are unable to provide for themselves and their families with what they earn. The US Bureau of Labor Statistics publishes six different unemployment rates regularly, attempting to include some of the excluded segments of the labor force. To some extent, this provides a better idea of who is working and who is not. However, these numbers do not address critical questions regarding employment:

Are there enough suitable jobs for everyone who can work?
Do the available jobs pay sufficient wages?

For those who still see labor as a mere commodity for the purpose of generating profits, then these questions may not be relevant. Neoliberal economists also tend to dismiss their importance since, according to their core understanding, the market (labor supply and demand) should be allowed to take care of job availability and wage levels. However, in practice, markets are imperfect and large corporations have sufficient market power to suppress wages in order to increase profits. To understand this situation better and how to address it, it will help to examine the market dynamics regarding unemployment.

Government Policies to the Rescue

Ravi Batra’s latest publication provides an interesting analysis of unemployment by examining the dynamics of supply and demand. Entitled End Unemployment Now: How to Eliminate Joblessness, Debt, and Poverty despite Congress, the book focuses on solutions he considers feasible that US governmental agencies can implement to solve unemployment and its related economic woes. Batra’s proposed solutions are essentially public initiatives. Batra uses simplified market dynamics to explain the roots of unemployment and how eliminating it would thereby resolve the serious imbalances in today’s economy.

Batra starts with the basic formula for market equilibrium: supply = demand. When the value of goods sold is equal to the demand by consumers and investors, the economy is in equilibrium and all is well. Building on this foundation, he focuses on the relationship between productivity and wages. Productivity is proportional to supply and demand is proportional to wages. Batra states that due to increasing investment and better technology, worker productivity will increase ( workers can produce more with less work) which in turn increases supply.

In order to keep demand in balance with supply, real wages must also increase to provide workers with the money needed to purchase the additional goods and services. When wages do not keep up with supply, there is insufficient demand, resulting in business slowdown and layoffs

This is Batra’s main argument. Unemployment is caused mainly by the wage-productivity gap in developed countries. In developing countries, a lack of production results in insufficient supply which, in turn, results in unemployment and low demand. .



Below is a table illustrating wage stagnation in the USA, produced by Michel, Gould, and Bivens from the Economic Policy Institute (2015). Since 1973, there has been a stagnation of real wages, in spite of continual increases in productivity.
According to Batra, the reasons for this gap are clear:
  • Employers are greedy and do not want to pass on the higher profits they gain from increased productivity.
  • Supply-side, trickle-down economics, with its regressive taxation, fails to stimulate more investment and puts more tax burden on the middle/lower class workers, thereby decreasing demand and increasing the gap.
  • Outsourcing to foreign countries lowers the demand for local labor, resulting in less jobs and lower consumer demand. While supply remains constant, layoffs ensue and the gap increases.
  • Large corporations operating in today’s monopoly capitalism are able to manipulate markets to the extent that they can “restrain output, charge higher prices, and control wages.”
In order to eliminate this gap and the resulting unemployment, Batra proposes several Federal government solutions that sidestep the US Congress—currently stalemated—and avoid increasing debt. Though specific to the US, these federal actions would be intended to break up the banking monopoly and lower interest rates, intervene in the foreign exchange markets to achieve a balanced free trade, link the minimum wage in the country to national productivity, and prohibit mergers that create monopolistic corporations. According to Batra, these steps would create more competition in the economy, raise wages and demand, reduce debt, and help alleviate poverty.

It is beyond the scope of this article to analyze each of Batra’s recommendations. However, if the federal government managed to implement even a few of Batra’s recommendations, it might be possible to reduce some debt, decrease our trade deficit, and reduce the rate of corporation mergers. Yet it is hard to imagine that his approach would break up monopoly capitalism to any significant degree. Without accomplishing that, wages would continue to be suppressed while those at the top reap the fruits of the economy’s labor, and exert undue political influence.
 

Wage-Productivity Gap in the USA




Workers produced much more, but typical workers’ pay lagged far behind: Disconnect between productivity and typical worker’s compensation, 1948–2013
Note: Data are for compensation (wages and benefits) of production/nonsupervisory workers in the private sector and net productivity of the total economy. "Net productivity" is the growth of output of goods and services less depreciation per hour worked.
Source: EPI analysis of Bureau of Labor Statistics and Bureau of Economic Analysis data

Complexities of Unemployment

The causes of unemployment are complex and involve multiple social, political, and economic factors. Batra’s book focuses on one main phenomenon – the wage-productivity gap. However, as an explanation for unemployment, this argument does not seem to be consistent with the functioning of a labor market. Batra assumes that capitalists will continue costly investment in technology and increasing productivity (supply) in the face of decreased demand. Yet why would profit oriented businesses continue to irrationally expand their output of goods and services if there is no increasing demand for them? According to the same law of market equilibrium, we would expect supply to decrease proportionally with decreasing demand and increased investment to occur only when justified by demand and available investment capital.

It is also not clear why the wage-productivity gap would lead to unemployment. An increasing wage-productivity gap means workers are increasingly more desirable. When the gap between worker productivity (what workers add to output and thus profits) and what workers cost (what workers subtract from profits) is growing, workers are an ever increasing bargain so that hiring becomes more attractive. In other words, the greater the wage-productivity gap, the more desirable workers become. This increasing gap
will invariably lower unemployment both because workers are more economically desirable overall and because domestic workers become a better bargain than cheaper but far less productive outsourced workers. Additionally, when wages are depressed, companies may prefer more labor-intensive production compared to costlier hi-tech options. As noted earlier, the unemployment rate has actually been dropping since 2010, perhaps not in spite of a high wage-productivity gap, but because of it. The problem here is not unemployment, but under-employment. This is the situation today, where low unemployment coexists with high productivity and stagnant wages.

Although the wage-productivity gap may not explain unemployment, Batra does point out the major causes behind current stagnant wages, income inequality, and rising debt. He identifies monopoly capitalism as the main culprit, as it allows large corporations to manipulate markets for the benefit of a few—their management and stockholders. The centralization of economic power and resources is not only responsible for the economic problems in developed nations, but across all countries around the globe. The lack of production and consequent unemployment in developing countries is directly connected to unfair trade practices, centralized markets, and the domination of multi-national companies.

Growing employment from the bottom-up

Batra briefly references mass capitalism, conceptualized by Apek Mulay[2], as a possible replacement for monopoly capitalism. This new model would transform manufacturing by ensuring worker ownership of companies. Mass capitalism is similar in many respects to economic democracy, which is rapidly gaining favor among progressives who understand the need for fundamental changes in our economic system. Unfortunately, Batra gives most of his attention to government interventions to reduce unemployment and improve the economy. Yet when the government is controlled by those same mega-corporations that manipulate the markets and wield massive political influence, it is difficult to imagine that true solutions can ever emerge from governmental interventions.

Instead of bandaiding the problem, it would have been more productive for Batra to focus more of his book on Mulay’s mass capitalism. After all, these ideas echo the teachings of Batra’s life-long mentor, P. R. Sarkar, who, over 60 years earlier, elaborated a decentralized and democratized economic system known as Prout. Although Batra has written extensively about Prout, this book is intent on promoting improbable public policies than true economic restructuring.

So how would a more democratized economy solve unemployment? How would it create a more balanced supply and demand? Let’s return to our original market equation and see how Sarkar would maintain a dynamic balance in the economy.

According to Batra, when, for a number of reasons, supply is greater than demand, the productivity-wage gap increases, resulting in layoffs, growing unemployment, and further weakening of demand.

Here’s what Sarkar would do:
  • Productivity is the driving force in the economy, making it more efficient, increasing supply and reducing production costs. Today, much of this is done within the context of a global economy that shifts jobs abroad and drives down wages[3]. Batra recommends a monetary solution by manipulating the value of currency for foreign trade. Sarkar’s systemic approach, on the other hand, would decentralize the economy to stimulate self-sufficiency at the local level. This would significantly increase production to meet local demand and create ample jobs. Both supply and demand would rise, improving living standards across the board. By not depending upon the fluctuation of foreign markets and the whims of corporations, the economy would become more stable.
  • Additionally, Sarkar’s economic democracy would give localities, not corporations or government entities, the responsibility for planning and developing their economies. Communities could then adopt a full employment policy and coordinate education, training, and local growth to create decent jobs for everyone. Community wealth would increase as well so that those with special needs could be provided for.
  • As regards the suppression of wages, Batra offers the weak solution of federally adjusting the minimum wage for federal contractors. This would impact only a small percentage of workers who are working at minimum wages. Even significant increases in the minimum wage in the US would scarcely help people meet their basic needs. The real problem lies in corporations who suppress wages to benefit their shareholders. Under Sarkar’s system, profits would be distributed more equitably as businesses would be democratically controlled by their workers. To achieve this, he recommends that most medium and large enterprises transition to employee-owned cooperatives. Such companies would ensure minimum differentials in salaries between the highest and lowest paid employees, guaranteeing stable and rising wages for all workers. They would also be committed to retaining their worker-owners affected by technological advances instead of laying them off. This could be accomplished by shortening work hours for the entire company or expanding business operations through new cooperative ventures.
  • Finally, community-based companies, like cooperatives, would continually invest their profits in R&D (rather than speculating in financial markets), thereby raising productivity. With increased production, prices would actually fall. This would enhance real wages (purchasing capacity) further and lift living standards for the entire community.
The combined effect of all these measures would create a dynamic balance of supply and demand in the marketplace. With a thriving, decentralized economy, no one corporation could control any industry and manipulate prices, wages, and supply. Instead of competing with other localities for a handful of jobs being promised by a large, outside corporation, communities would be building their own economies, and creating jobs for everyone. To achieve Batra’s major goals of eliminating unemployment and poverty, a permanent cure for monopoly capitalism is required—one that addresses the root causes of our unhealthy economy.
Jagatbandhu is a long time Proutist and economist who lives and works in central North Carolina. Hiranmaya is the Director of the Center for Local Economies and consults on community economic development.

[1] http://money.cnn.com/2016/02/06/news/economy/obama-us-jobs/
[2] Mulay, A. (2014). Mass Capitalism: A Blueprint for Economic Revival. Bothell, WA: Book Publishers Network.
[3] Outsourcing does not improve productivity per se. It only reduces production costs but through exploitation rather than through improved productivity.
UPCOMING EVENTS

Prout Convention 2016

July 18 – 24, 2016
Ananda Gaori, DK


 

This year’s program focuses on responses to the refugee crisis in Europe and exploration of future scenarios on migration. The migration issue is already impacting our lives and what we are experiencing now may just be a taste of what is to come. As Proutists, it is important that we anticipate coming events and promote cooperative and humane responses which take into account the needs and concerns of all those affected by the crisis. This year’s program includes: 
 
  • Stories from people dealing with refugees first hand – our own Syrian Margii refugee sisters now working with other refugees in Berlin, Fariz Karimeh from Sweden, a Swedish resident originally from Syria who is helping refugees set up their own ecovillage in Uppsala. Jaya Brekke who spent time on the beaches in Greece receiving refugees as they arrived.  
  • The refugee crisis from a Prout perspective, going into depth regarding everything that P.R. Sarkar said on the subject. We will discuss how we can address this critical issue with fair and effective policies.
  • Future scenarios from Prof. Sohail Inayatullah (Subodh) who consults for governments, universities and organizations around the world on issues like climate change and migration.
  • Group work to make practical use of the information and come up with constructive Prout policies
  • A series of workshops from Andelstanken, the “Coop Think Tank”, a Proutist initiative in Denmark making exciting progress reviving the Danish Coop tradition in the countryside.
  • A series of workshops from guest Permaculture trainers Jillian Hovey and Jonny Paszkiewicz on traditional and “social” Permaculture i.e. Permaculture applied to building healthy communities.
  • We’ll hear what Proutists around Europe and other parts of the world have been doing and experiencing in their local regions. 
 
The Prout Convention now has its own dedicated website where you can find out about the programs in detail, get the latest updates, and even book rides to and from the convention.
PROUT ACTIVIST AND PLANNING SESSION
 JULY 24 – 28 AT ANANDA GAORII

This four-day workshop and planning session will be held immediately following the Prout Convention.  Come together with seasoned Proutists to plan and network for the year ahead. The goals for this year’s session include: 
  • Strategic planning for Prout activism in Europe and the rest of the world
  • Planning a public conference for 2017 focusing on the themes in the book Growing a New Economy
  • Creating study circle programs in local areas using the book Growing a New Economy
  • Developing our websites, internet presence and written materials
  • Developing Future Europe as a samaja platform and social change hub
  • Improving our internal structure and communications
This workshop is replacing what had formerly been known as “Activist Training”.
This is your chance to have a say in Prout work for the future.

Please join us and make a difference.

Contact:  vishvashanti(at)prout-global(dot)net, krsnasevananda(at)prout-global(dot)net
Cost: 100 Euros including food and accommodation. Payment can be made at the beginning of the program.
NEW PROUT PUBLICATIONS

Growing a New Economy: Beyond Crisis Capitalism and Environmental Destruction


By Roar Bjonnes and Caroline Hargreaves

 
The long awaited new book on Prout by Ramesh and Nalini is finally going to press!

The economic reforms we have seen in recent years—be they conservative, leftist, or green—have been unable to alter the destructive course of our economy. It’s time for systems change. It’s time to move from the power of the corporation to the power of cooperation, from the centralized power of the board rooms to the decentralized power of economic democracy. Growing a New Economy presents holistic solutions to our economic problems that are so revolutionary they may in fact save both our economy and our rapidly deteriorating ecosystem.
 
Growing a New Economy is a great primer if you want to get up to speed on the dangers lurking in the global economy. The authors provide a long-term agenda for green, systemic change. A most elucidating and educating read.”
—James B. Quilligan, political economist; advisor to Pierre Trudeau, Olof Palme, Willy Brandt, and other world leaders.
 
 

Chapter-by-Chapter Outline

Section One: The Perfect Storm

Chapter 1: The Financial Crisis
The Euro crisis, which has shaken up banks and governments and created massive unemployment in many countries, is still far from over. Using the Euro crisis as a starting-point, this chapter examines the current debt crisis and its consequences, both for individual citizens and for the global financial system. The authors investigate how the crisis has been handled by politicians and central banks.
 
Chapter 2: The Inequality Crisis
Economist Thomas Piketty took the world by storm in his bestselling book Capital in the 21st Century. Based on over a decade of research, his book details the rise in global inequality, which is also the topic of this book’s second chapter. But the authors of The End of Crisis Capitalism also describe how the growing material and cultural inequality in the industrialized world is directly linked to the increasing mountain of debt. They discuss the various policy decisions that have led to the increasing economic divide, eroded the safety nets of the middle class, rocked the foundation of the welfare state and swelled the ranks of the poor.
 
Chapter 3: The Resource Crisis
Are we running out of resources? Are we experiencing peak oil? Or are we experiencing peak everything? While we have seen a temporary drop in oil prices recently, the cause of this drop is not because of increased supplies but rather because of price manipulations. Thus, starting with the increasing cost of obtaining energy and raw materials, and the physical limitations of our planetary environment, this chapter explores in great detail why we are in the midst of a serious resource crisis.
 
Chapter 4: The Environmental Crisis
Both our economic and environmental problems are becoming increasingly global in scope. In this chapter the authors view the environment in a broader perspective, and they show how we are not only running out of non-renewable resources but systematically destroying the global ecosystems as well, including depleting a large portion of the global fish stock and polluting the ocean—perhaps beyond repair.
 

Section Two: Historical Perspective

Chapter 5: From Mercantilism to Green Capitalism
Starting with mercantilism and industrialization, this chapter traces the history of economic thought, from socialism and self-regulating markets, to free trade and green capitalism.
 
Chapter 6: The European Union
After providing a brief history of the evolution of economic thought, it is revealed that the European Union was, in part, constructed as an experiment in free market economics based on neoclassical economic ideals. While some EU countries have benefited economically from joining the Euro-zone, other countries have been struggling.
 
Chapter 7: The History of the Environmental Movement 
The chapter explains the human inclination to destroy nature as an inevitable effect of an economic outlook seeing nature as a free resource and a subsection of economics. It also assess the potential of green economic theory and activism as well as ecological science to create coherent, economic policies and why the efforts have failed to gain ground thus far. 
 

Section Three: Challenging the Accepted Economic Dogmas

Chapter 8: A Critique of “Free Markets”
We all know there is no such thing as a “free lunch” but few are aware that there is no “free market” either. All markets have rules, and these rules benefit some groups of people while going against the interest of others. The authors thus point out the problems and inconsistencies with free market economics.

Chapter 9: A Critique of Neo Classical Economic Theory 
Neo-classical Economics (NCE), the most commonly practiced economic theory today, is not a science in the traditional sense. On the one hand, this economic system represents an ongoing, historical, socio-political worldview, and on the other, it represents an economic way of thinking that its adherents take for granted as a self-evident truth. Any thorough critique of NCE must therefore include an investigation into the historical processes from which the theory originated as well as a rational analysis of its main ideas. In this chapter, the authors attempt to provide both.
 

Section Four: Creating Lasting Solutions

Chapter 10: Resolving the Immediate Crisis
This chapter suggest how we can reform the dominant workings of capitalism and take steps towards solving the immediate crisis. Fundamentally important questions such as these are covered: How do we tackle the debt crisis and increasing inequality? How can we reform the financial and speculative aspects of the economy?
 
Chapter 11: Making Poor Countries Rich 
In this chapter, we will examine ways of making poor countries richer and more sustainable, through measures such as fair trade and positive development.
 
Chapter 12: Economic Democracy: The Long Term Solution
This chapter introduces the concept of economic democracy, a system ensuring that economic power is widely spread both between various geographical regions, and between the citizens within each region.
 
Chapter 13: Beyond Sustainable Capitalism: Rethinking Green Economics
The global economy is faced with a massive scale of rapid material growth but without the corresponding environmental mechanisms to protect people and nature. The green movement in particular is at the forefront of creating much needed reforms. In this chapter the authors examine the potential future of green capitalism.
 
Chapter 14: A New Economic System  
In this chapter, the authors tie together the above analysis while showing how existing economic theory falls short of addressing the larger, systemic problems of resource allocation and the effects of climate change in a world with limited resources.
Global Impact: Prout News and Commentaries is a quarterly publication of the Proutist Universal Global Office, Copenhagen, Denmark
Publisher: Ac. Ambareshvarananda Avt.          Email: globalimpact@prout-global.org   
The views expressed in this newsletter are those of the authors and do not necessarily represent or reflect the views of the editorial staff of Global Impact.
Copyright © 2016 Proutist Universal, All rights reserved.


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