Editor's Note: Pranab Bardhan is Professor of Economics, University of California at Berkeley and the author, most recently, of Awakening Giants, Feet of Clay: Assessing the Rise of China and India.
By Pranab Bardhan, Project Syndicate
Inequality is on the public’s mind almost everywhere nowadays. Indeed, in the world’s two largest democracies, India and the United States, widespread popular movements against rising inequality and elite greed are becoming highly salient issues in looming national elections.
Yet, in both countries, some social inequalities have been on the decline over the last few decades. In India, certain historically disadvantaged groups (particularly among the lower castes) are now politically assertive. The most egregious vestiges of caste discrimination are gradually disappearing. Similarly, in the U.S., discrimination against women, African-Americans, Latinos, and homosexuals is declining.
These developments reflect a democratic advance in both countries. At the same time, however, the fabric of democracy is being torn apart by a staggering rise in economic inequality.
Generally, economic inequality is easier to justify than racism and other forms of invidious discrimination. A fundamental tenet of American society is that everyone has an equal chance – a belief that appears more plausible with the decline of social bias. In India, this myth is less powerful, but there is a general feeling, shared even by some of the poor, that the rich deserve their wealth because of their merit, education, and skills.
There are two problems with this argument. First, education and skills are not inborn talents. The rich have access to better schools, health care, nutrition, and social support than the poor, which plays a decisive part in later academic and social success. Pre-school children in rich families have better nutrition, health care, and mentoring; there is evidence that much of the brain damage due to malnourishment for poor children may have already, irreversibly, happened by age three.
When students from poor families start to fail in school, they have little or no access to remedial classes, whereas the rich receive expensive coaching from private tutors throughout their education. As a result, India has the world’s largest number of school dropouts.
Sociologists in the U.S. have also documented adverse “neighborhood effects” for poor children in inner cities. In Indian villages, where residential patterns are often even more segmented, such effects are acute.
The other problem in both countries is the rising importance of ‘unearned incomes’. In India, as in other fast-growing economies, scarce public resources, such as land, minerals, oil and gas, and telecommunication spectrum, have shot up in market value recently, generating extremely high unearned income for the politically well-connected.
In the U.S., the deregulation of the financial sector over the last few decades, and the accompanying rise of dubious financial instruments, destabilized the real economy while doing little to improve productivity. The result, as everyone knows, was exorbitant financial gain for a select few, followed by large losses that were paid for by the many.
The U.S. and Indian examples suggest that, in democratic societies, groups that promote social discrimination grow politically weaker over time. Economic inequality, on the other hand, is perpetuated through the politically powerful and well-funded lobbies of the rich. The trend is reinforced as elections become more expensive in both countries, leaving politicians increasingly dependent on contributions from wealthy donors who demand policies that are favorable to their interests.
This implies that anti-discrimination and egalitarian movements need to broaden their focus to include electoral reform, better financial regulation, transparent privatization, and, above all, an overhaul of the education system to ensure high-quality schools for the poor and pre-school nutrition and health care. In addition, massive investment in both countries’ creaking physical infrastructure would create jobs for some workers and improve the productivity of others.
The advantages of improving education, creating more jobs, and increasing productivity seem clear. The question, then, remains why India and the U.S. neglect both education for the poor and infrastructure. The answer lies partly in the fact that the rich in both countries are ceasing to use many public services. They send their children to elite private schools, are treated in expensive private hospitals, and live in gated communities where security and other services are provided privately.
Moreover, big companies nowadays have their own power plants, private roads, and many internal services as well. As the rich secede from the public infrastructure upon which the rest of society depends, it has become increasingly challenging to tax them in order to pay for services that they do not want or need. Meanwhile the pre-existing countervailing institutions (like labor unions) for the workers get eroded by new technology and globalization.
In India, greater social equality has meant that small numbers of hitherto subordinate social groups have begun to enter the political and economic elite. Once there, however, rather than trying to change conditions for the poor, they adopt the values of the elite while manipulating the symbols of identity politics – a tactic that still attracts votes. (Democratic South Africa shows how difficult it is to make a dent in economic apartheid).
Both India and the U.S. have responded to unrest over rising economic inequality with a kind of reactive populism. In India, this takes the form of loan waivers for distressed farmers (which weaken the banks); price controls for water, electricity, and public transportation (which wreck government budgets and undermine the prospect of long-term investment in those areas); and more subsidized food in the corrupt and inefficient public distribution system.
Meanwhile, in the U.S., populist right-wing movements prefer tax cuts to long-term investment in infrastructure. At the other end of the political spectrum, anti-state anarchists cannot help in building institutions that will sustain pro-poor investments.
The world’s two largest democracies face a grave economic challenge. They must find a way to channel the rising anger caused by economic inequality into productive investments that make the rich feel that they have a stake in ameliorating conditions for the poor. If India and the U.S. move towards overcoming the most pervasive inequality of all, they will reinvigorate their democracies – and their economies.
The views expressed in this article are solely those of Pranab Bardhan.
© 2011 Cable News Network. Turner Broadcasting System, Inc. All Rights Reserved.
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Compared to India, the U. S. is a young country but has a much older democracy, that works on the bottom-up basis. India has an ancient history, yet it became only a democracy when it gained independence from Britain some 60 years ago. After centuries of top-down rule, the people still haven't shrugged off their acquiescence and subservience. In many rural areas social inequality and the caste system are wide-spread. Although many take to the streets and voice their discontent, most prefer to mind their own business. Living in an ivory tower they turn a blind eye to invidiousness and social distress.
Millions in India still believe that life is down to fate and fortune as the luck of the draw. That's why they think "the rich deserve their wealth". In America one believes in forging his/her own destiny.
If that were true,there wouldnt be so much struggle and protest in India.People protest and struggle,because they have hope.If they has resigned to their fate,they would all be happy with what they have.
j. von hettlingen – 100% true
The difference between West and India is that India has been only poor for 200 yrs and the West has only been rich for 200 yrs.
Who do you think laid the train tracks and concrete that stretch coast to coast. Who do you think built all the buildings and logged the forests to do it. Who do you think beat back the British army in their prime and invented the technology to win our independence WW1 WW2 and the cold war. We weren't always rich in America. We worked our ass off to get ware we are and we still do. Americans work more ours per year with less vacation than all other industrialized country's. Not to Say you don't work hard in India but don't think for a second that anything was handed to us in the U.S.
We all know the dirty games India is playing in the region...financing terrorists who are killing US/NATO/Pakistani troops ....undermining democracies, paying off some factions of talibans protection money so they won't do another Mumbai attack, All this because they are scared of Al Qaeda and Talibans.
Yes not everyone can be as pure as paki-satan
Pakistan is a state sponsor of terror. Everyone in the world knows it. That is why Pakistan and Pakistanis are despised the world over–except, perhaps, by other rogue states with whom AQKhan has shared nuclear secrets.Pakistan is haven to various terrorist groups, including Alqueda, Haqqani, the Taliban, etc. the list goes on and on. The attacks on innocent Afgans and innocent Indians are planned by the Pakistani ISI- the source of evil in the world. Drop a bomb on the ISI-and terrorism will suddenly decrease- a miracle!!!
INDIA: On a Goat and a Stick:
The problem with India is that is built on a system of cultural and societal values based on Hinduism which is a cult. Nations built on a cult seldom survive in the long run. You can only take it so far based on symbolisms of a goat and a stick with a skinny little man aka gandhi banging boys at night and spinning wheels during daytime.
Seems to me you might want to learn a bit of history.
To krm:
You are clearly a Pakistani. Go back to your madrassa. Better yet, tell your hate-filled evil lunatic countrymen that Pukistan will never be successful as long as it terrorizes its neighbors.
The USA takes Shanghai and General Tamer
General Tamer occupies Austin and is trying to take Houston – Battle of Houston starts – http://battleofhouston.blogspot.com/
Your article is quite interesting.However it assumes that somehow there is a link between democracy and equality/in equality.Far from that,the reason why it is so easy to criticize India and US is because so much information is available.India does not try to hide its wounds.We look at them in the eye and try to deal with it.Inequality is there everywhere.How many people have a hope of fighting against it and winning against it.The fast that in India,you see so much struggle,is because that is hope and people genuinely believe they can in.More other societies have no such hope.This is a victory for India!
"Experimental Democracy" has failed in India. An experiment that was being shoved down India's throat by western countries too eager to propagate their own values on a country that was trying to decolonize itself while trying to shed the communist skin of being a Soviet ally. India was thus trapped. What has become evident now is that this "Experimental Democracy" has marginalized the country. The marginalized groups of the country – Dalits and ‘backward’ castes/classes, indigenous ‘tribal’ people and religious minorities have been disenfranchised. "The belief that corruption is the important issue in the country is shared only by the minority living in urban areas and towns who have been beneficiaries of economic liberalization policies mandated by western countries. The most important challenges of Indian society remain as follows: justice, social and economic equality and equal access to certain standards of life for all Indians. “While India seems too eager to please its western masters and put on a progressive and softer face for CNN for public consumption, people see through it. The consequences of this "Band – Aid" approach will be brutal for India geo-politically when it realizes that the GDP statistics that it has been relying to gage its progress has not amounted to much in the long run.
Democracy explained by a Pakistani
Hope you don't live in Pakistan. One of these days, you will have one shove D up ya...
@krm1007:
Grow up boy – grow out of hate.
What does Pukistan export, other than terror? (uh, I mean Pakistan)
The TV listings in The Hindu show Fareed Zacharia at 17:30 Sunday but it comes on at 18:30. Also, it comes on elsewhere, even on Dish TV, on Monday afternoon but the DishTVwe get here in Tamil Nadu doesn't show it then but at 7:30 Monday morning, and that is not mentioned in the newspaper. I know it is partly a problem of "daylight savings" time in the US, but please try to see that the newspaper TV schedules are accurate, especially for important programs like GPS
This is like comparing a leper to an HIV patient. Unlike hindus, americans do not worship rats and cobras,
Better to worship rats or cobras than a suicide bomber
You got him !!! Brainwashed Fanatical Pakis get your head out of your anus first.
here we go again with the immature nonsense. Bravo A$$ holes.
Get a life, Paki!!!! You are pathetic.
NEW YORK: Renowned Indian activist and novelist Arundhati Roy has decried the silence of the international community over the continued “brutal Indian occupation of Kashmir” and said Kashmiris should be given the right to self-determination.
“Kashmir is one of the most protracted and bloody occupations in the world — and one of the most ignored,” she told a large audience at the Asia Society during a discussion on “Kashmir — a case for freedom”.
Under the Indian military rule in Kashmir, Ms Roy said, freedom of speech was non-existent and human rights abuses were routine. Elections were rigged and the press controlled.
She said the lives of Kashmiris were made miserable by gun-totting security personnel who harassed and terrorised people with impunity, adding that disappearances were almost a daily occurrence as also kidnapping, arrests, fake encounters and torture. Mass graves have been discovered and the conscience of the world remains unstirred……
The apathy towards Kashmir, especially in the western world, Ms Roy said, was because of their pursuit of commercial interests in India where they were more eager to “sell their goods than human rights”……..
Man you are everywhere
Live Veena Malik for India, Arundhati Roy for Pakis.
LMAO.
Get it in you stinking head which you still have stuck in your anus. Even if Kashmir became independent or even joined Pakistan, your lot will continue to find something to hate in others. The fact is you will always have fecal matter in your head. So what is the point of you trying to say anything that does not stink !!
Pakistan, an evil state sponsor of terror, has been conducting a silent war using terrorism in Kashmir. Pakistani terrorists have basically driven out peaceful hindu Indians who had been living there for hundreds of years. Over the past 25 years, about 50000 innocent Indians have been killed by the evil Pakistani terrorists. Why the heck would anybody, even a muslim, want to live in Pakistan, the armpit of the world? Muslims in India, for example, are the most literate and prosperous and free compared to muslims elsewhere. Pakistan has gotten bad karma, and will never be successful.
india is becoming a burden on the world eco system. like in argentina farming world, the hindu men need to be castrated so they fhey can find another hobby than reproducing
Krm–> Are you hina "rub-on-me" khar
Get it in you stinking head which you still have stuck in your anus. Even if Kashmir became independent or even joined Pakistan, your lot will continue to find something to hate in others. The fact is you will always have fecal matter in your head. So what is the point of you trying to say anything that does not stink !! You are so full of crap that all I can see is crap.
Wrong again. You need a psychiatrist. It is the muslims in India who are breeding like rabbits. Muslims think they are just too special to follow the common civil code, which hindus and christians follow. A hindu man has one wife, and usually produces one or two children. A muslim man can have three wives at a time. You can see muslims with a brood of offspring in tow.
Are you hina "rub-on-me" khar
All such comparisons seem simplistic. Merely because both India and the US are democracies does not make such comparisons relevant. India is a Continent with a Billion people,over 40 official languages, numerous castes and religions and fundamentally an agricultural society. social stratification is therefore more entrenched. What is remarkable is that social inequality is changing in twenty years, that was not possible over hundred years in the past. The US has had its own challenges but these are vastly different from India. Economic inequality too in the two countries must factor in the above issues. What is very gratifying is that India is drawing from the US example to deal with economic inequality and not following the Communist model that it pursued in the Fifties and Sixties
BODDA BING BODDA BOOM
We are Hindus from India,
And we like to put on the Bindiya,
We are mostly Haris,
But we like to put on the Saris,
Sadly, we are nothing but Bhikaris,
Sadly, we are nothing but Bhikaris,
We take the Americans to Heart,
But get nothing in return except a F@rt,
So we tend to kiss the American @ss,
Again, we get nothing in return except the American gas
So much for the comparison....LMAO
The Multidimensional Poverty Index developed by Oxford University shows that India is far poorer than Africa not just in number but also in intensity.
The new poverty measure shows that 8 states out of the 29 states in India have more poor people than 26 poorest African countries combined. The Multidimensional poverty index views poverty from several different angles instead of just GDP figures. India is crippled by so many problems. For example, India's population growth rate is increasing by the day putting pressure on the limited resources and leaving many Indians in absolute poverty. India is very poor in terms of education, in terms of economic improvement, infrastructure, heath care, etc.
SHAME ON INDIANS..... For financing the terrorists waging this war. Shame on the Indians from running away scared from terrorists and taking bullets in their back. Shame on the Indians from counting the GDP statistics while American and Pakistani blood was being shed in the battlfield trying to make the world safe.
Is this the kind of neighbors you would want living next door to you and your kids??? HECK NOT IN MY NEIGHBORHOOD !!!!!
Krm:
You need a psychiatrist. Get some medication. You have issues.
Pranab is correct. Social/monetary inequality is the cause of anger in India. Eradication of illteracy is the answer.
They have American jobs? Our bought and paid for government allowed their rich CEO friends to make outsourcing and increasing upper management pays scales more attractive than hiring American workers...
ere is short summary of what Pakistan did for USA.
1) Choose US over Russia as Ally since the creation of Pakistan.
2) Pakistan Join CENTO (Alliance again Russia), just to please USA
3) Pakistan did not took part directly in Arab-Israel wars, again just to please USA
4) Pakistan lost half of the country (Pakistan was at fault) and did not get any direct military support from USA and at they end they had to raise white flag and accept defeat.
5) In 1980’s after Russia’s invasion of Afghanistan Pakistan was brainwashed by USA that Russia is going to invade there land, USA provided full military and some what financial support to Pakistan to train Mujahidin’s against Red Army in Afghanistan, at the end Red Army left and its economy collapsed, USSR was also broken into several countries, it is not wrong to say that former soviet Union was defeated by Mujahidin’s and the won the war for USA.
6) Pakistan is home to millions of Afghan refugees due to ongoing wars in Afghanistan in which USA is directly or in directly involved. Afghan refuges also brought drugs and weapons which resulted in thousand’s of death in Pakistan.
7) After 9/11 Pakistan shook hands with USA again to eliminate al-Qaida and Taleban from Afghanistan, the outcome of this is 30,000 thousand deaths in Pakistan and loss of 60 billon $.
Pakistan is a state sponsor of terror.... even if Pakistanis want to deny it. The whole world despises Pakistan. The whole world recognizes that Pakistan is a blot on the face of humanity. All the paths of all the major terrorists caught the world over have passed through Pakistan. Pakistan was haven to one Osama Bin Laden. Pakistan is haven to several terrorist groups, including Alqueda, Haqqani, the Taliban, etc. Pakistan has passed nuclear technology to other rogue states. Pakistan IS the axis of terror. Pakistan IS the nexus of evil.
INDIA: On a Goat and a Stick:
The problem with India is that is built on a system of cultural and societal values based on Hinduism which is a cult. Nations built on a cult seldom survive in the long run. You can only take it so far based on symbolisms of a goat and a stick with a skinny little man aka gandhi banging boys at night and spinning wheels during daytime.
The Multidimensional Poverty Index developed by Oxford University shows that India is far poorer than Africa not just in number but also in intensity.
The new poverty measure shows that 8 states out of the 29 states in India have more poor people than 26 poorest African countries combined. The Multidimensional poverty index views poverty from several different angles instead of just GDP figures. India is crippled by so many problems. For example, India's population growth rate is increasing by the day putting pressure on the limited resources and leaving many Indians in absolute poverty. India is very poor in terms of education, in terms of economic improvement, infrastructure, heath care, etchey
PAKISTAN.....The
New Gateway to Central Asia and Europe.
With a
population of over 180 million most of whom are well educated, english
speaking, entrepreneurial, a cultural and social fit with Central
Asians...Pakistan will now become the new face and gateway to Central Asia and
Europe. Pakistan will thus span this region and provide the impetus for growth,
prosperity and unity among these countries. These are new and exciting times
for Pakistanis who should now look forward to their new leadership role aligned
with Central Asia and Europe rather than the Subcontinent. We wish them much
success as they have sacrificed the most during the past 30 + years creating a
new world order. thanks
You Pakistani trolls posting here really need psychiatrists. Are you off your medication, perhaps?
I think you are just ASHAMED to be Pakistani -- so you need to project. You need to go back to your country, and try to improve it. Maybe you can bring it into the 12th century.
I'm neither Muslim nor a pessimist but I'm annoyed at India's cruelty and deceit in killing Muslims in Kashmir and helping USA killing the other Muslim neighbors in Afghanistan and Pakistan. Firstly, USA is known for dovish acts of instigating, riots, revolution, chaos and terrorism throughout the world. Perhaps India's Gandhi philosophy of peace is violated big time by these so called ruthless leaders of modern India. It is shame on Indian's who have over 1400 spiritual Gods' and praying daily and allowing suck acts of inhumanity on another race. Religion should never considered a threat in any society like the way India is enduring and allowing acts of flimsy inhumanity beyond ones belief. Infect there are more Muslims in India then Pakistan who are no threat within and who live in peace and harmony with their Hindi neighbors. It is about time for India to change its evil racist stance and endorse peace in the region and get rid of the devil (US) form the demography..
Can any indian get me a fresh glass of cow urine, please?
SABA, when you make comments like that you put not only your lack of intellect on display but that of your parents as well.
Freedom is the easy part, now comes the pursuit of wealth with greed as the impetus. Naturally.
Good read. India has taken strides in improving it's economy and it's standing in the world community. It should however look improve on it's micro level domestic issues as well. Then only will it be a model for it's neighbors and have greater influence around the world.
Let's pray that Pakistan will one day become a a nation of free thinkers as well. For now, I won't hold my breath.
India and US have a lot of things in Common.
Lust for Imperialism
Religious intolerence in the name Secularism.
Deception dilussion
Lies and fraud
and always hidden agandas
These are possibly the 5 best sentences you'll ever read: Unfortunately, most voters don't know this.
1. You cannot legislate the poor into prosperity, by legislating the wealth out of prosperity.
2. What one person receives without working for, another person must work for without receiving.
3. The government cannot give to anybody anything that the government does not first take from somebody else.
4. You cannot multiply wealth by dividing it.
5. When half of the people get the idea that they do not have to work because the other half is going to take care of them; and when the other half gets the idea that it does no good to work, because somebody else is going to get what they work for, that is the beginning of the end of any nation.
"Experimental Democracy" has failed in India. An experiment that was being shoved down India's throat by western countries too eager to propagate their own values on a country that was trying to decolonize itself while trying to shed the communist skin of being a Soviet ally. India was thus trapped. What has become evident now is that this "Experimental Democracy" has marginalized the country. The marginalized groups of the country – Dalits and ‘backward’ castes/classes, indigenous ‘tribal’ people and religious minorities have been disenfranchised. "The belief that corruption is the important issue in the country is shared only by the minority living in urban areas and towns who have been beneficiaries of economic liberalization policies mandated by western countries. The most important challenges of Indian society remain as follows: justice, social and economic equality and equal access to certain standards of life for all Indians. “While India seems too eager to please its western masters and put on a progressive and softer face for CNN for public consumption, people see through it. The consequences of this "Band – Aid" approach will be brutal for India geo-politically when it realizes that the GDP statistics that it has been relying to gage its progress has not amounted to much in the long run.
INDIA: On a Goat and a Stick:HEY
The problem with India is that is built on a system of cultural and societal values based on Hinduism which is a cult. Nations built on a cult seldom survive in the long run. You can only take it so far based on symbolisms of a goat and a stick with a skinny little man aka gandhi banging boys at night and spinning wheels during daytime.
The Multidimensional Poverty Index developed by Oxford University shows that India is far poorer than Africa not just in number but also in intensity.
The new poverty measure shows that 8 states out of the 29 states in India have more poor people than 26 poorest African countries combined. The Multidimensional poverty index views poverty from several different angles instead of just GDP figures. India is crippled by so many problems. For example, India's population growth rate is increasing by the day putting pressure on the limited resources and leaving many Indians in absolute poverty. India is very poor in terms of education, in terms of economic improvement, infrastructure, heath care, etc O
Here is short summary of what Pakistan did for USA.
1) Choose US over Russia as Ally since the creation of Pakistan.
2) Pakistan Join CENTO (Alliance again Russia), just to please USA
3) Pakistan did not took part directly in Arab-Israel wars, again just to please USA
4) Pakistan lost half of the country (Pakistan was at fault) and did not get any direct military support from USA and at they end they had to raise white flag and accept defeat.
5) In 1980’s after Russia’s invasion of Afghanistan Pakistan was brainwashed by USA that Russia is going to invade there land, USA provided full military and some what financial support to Pakistan to train Mujahidin’s against Red Army in Afghanistan, at the end Red Army left and its economy collapsed, USSR was also broken into several countries, it is not wrong to say that former soviet Union was defeated by Mujahidin’s and the won the war for USA.
6) Pakistan is home to millions of Afghan refugees due to ongoing wars in Afghanistan in which USA is directly or in directly involved. Afghan refuges also brought drugs and weapons which resulted in thousand’s of death in Pakistan.
7) After 9/11 Pakistan shook hands with USA again to eliminate al-Qaida and Taleban from Afghanistan, the outcome of this is 30,000 thousand deaths in Pakistan and loss of 60 billon $.
I have never understood why there are SO MANY people hating on India in the comments section of American news channels! If you don't like India, don't read about it!! Not only do they rant, they also spread malicious misinformation regarding India and India's history!