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Karl Marx @ 200

20 June 2018 | Latest Editorials

This month, we had the 200th birth anniversary of the world’s greatest thinker and philosopher ever,Karl Marx, whose five greatest followers – Vladimir Lenin, Mao Zedong, Ho Chi Minh, Fidel Castro, and the most iconic of them all, Che Guevara – changed the world forever. They might all be controversial, but the fact is that, thanks to them, more than two-thirds of the world was being ruled based on ideas of one man – Karl Marx. They have often had faulty implementation – dictatorship (something that Marx never ordered) being the worst fault of all.

But today, if one were to pause and assess– as the leading economists and thinkers even from the current generation are unanimously agreeing – each and every prediction of his about capitalism has come true. As Marx had said in his theory of historical materialism, societies pass through six stages – primitive communism, slave society, feudalism, capitalism, socialism and finally, global, stateless communism. One look at the best societies of today and we know the first four stages are over and they are now passing through the fifth stage of socialism. Be it Sweden, Norway, Canada, Belgium or even Germany, capitalism is just a name that they still carry while their people pay incredibly high taxes and every citizen has equal rights to more or less free education and excellent health facilities; so much so that today a private enterprise is scared to enter these nations. After all, how do you compete against high quality, excellent and free facilities? The unemployment benefits guaranteed are such that youngsters are no more interested in doing a job for a few bucks more; and thus, luxury products are hardly getting a new generation that is interested in designer products. This new generation comprises satisfied youngsters, chasing their passions, and happy with the accommodation that the government provides, holidaying with the few bucks that their unemployment benefits provide and becoming better human beings, since to get access to these benefits, they are required to do various compulsory social work, like helping elderly people or people with special needs, for a few hours daily. Marx’s hatred for God and aim of destruction of religion are nearing completion in some of these societies. Norway, Sweden and Canada are nations with the highest number of atheists. All this has been achieved with the highest standards of democracy in these societies.

And now, there is one stage that’s left – global, stateless communism. Yes, specially with Trump and May there in two of the key economies of the world, it all might seem too impossible. Yet,rememberthat America was about to democratically elect one of the best human beings in their political environment ever – Bernie Sanders. And someone like him is just around the corner. Also, Jeremy Corbyn defeating May in Britain is just a matter of time more than probability. These happen, and you have a totally different world.

Every problem even today, from America to India, is about Marx’s premise of class struggle, as he said in The Communist Manifesto, co-written with Friedrich Engels and published in 1848: “The history of all hitherto existing society is the history of class struggle”. Today, be it the plight of Dalits and the marginalized in India or the struggle of the Blacks to gain respect in America, despite their last President being Obama, is all about this class struggle. And these nations are seeing the emergence of Marx’s other principle of ‘Dictatorship of the proletariat’. Bernie stands behind this genuine possibility of the working class gaining control of political power in the USA. So does Corbyn in UK. From Germany to the Scandinavian countries, near socialism prevails, thanks to strong labour rights and movements, which essentially means dictatorship of the proletariat, leaving capitalists and profiteers extremely frustrated.

Of course, yes, in the name of dictatorship of the proletariat, the concept of brutal dictatorship of the politburo was practiced in USSR, China and many socalled communist countries and that was and is wrong. The fact is that forceful abolition of private property and the collectivisation of land resulted in millions of deaths, especially under Russia’s Joseph Stalin and China’s Mao Zedong, bringing disrepute to the word Communism.

But the Marxian slogan of “workers (masses) of the world unite”, and the theory that capitalism will self-destruct into socialism through the forces of democracy, are seen to be happening all around us. Thanks to the Internet, today, it’s shameful to be seen supporting ugly opulence. Those are capitalists like Bill Gates, Warren Buffett and Mark Zuckerberg who are spearheading the donate-your-wealth movement for a more equal world. Soon, there will be a time when, to be looked up to, people would be forced to give up their vulgar capitalistic traits as the united world of workers (commoners and majority of the masses) on the Internet, would make them feel horrible about their existence. The need to take care of the dying and malnutritioned millions in the developing countries of Africa and rest of the Third World is today, more than ever before. And Chinese capitalism is showing that the need for profiteering is making capitalists go and develop the African continent; for the fact remains that there will be no one to buy your products till you give purchasing power to the masses.

On this special occasion, here’s a note on my father Dr. Malay Chaudhuri and my forthcoming book:Theory of Economic Justice, “What Marx Left Unsaid” – Production of Skills by Means of Skills.

Based on my father’s original ideas, which I have had the pleasure of teaching at IIPM and build upon, the book is a forceful case for an exploitation-free world, where the maximum wage ratio between the highest paid andthe lowest paid worker remains capped at 3:1.

I have grown up at home hearing from Malay Chaudhuri, my father, about his theory of production of skills by skills. Literally from my early childhood, just like my son, now, has been hearing it from him since he was in class 6th or so. Yes, my father believes this theory can be taught to anyone; and he has taught me and my son the same since we were 11 or so.

What the theory basically says is simple. Human beings must earn as per their skills, which determine their ability to contribute in a society. And skills must be measured fairly. All that we need to produce skills are two things. First, the readiness to sacrifice unskilled labour. That’s what any man is capable of giving with basic education – unskilled labour. The second is certain skilled hours of a trainer. So, if one is a 12thpass student and wants to become a graduate, the society loses on an entire lifetime of class 12thpass labour and has to invest three years of a skilled teacher’s labour, to make the person a graduate. And in return, the society gets from this educated graduate, 45 years of a graduate’s labour (assuming the person is 20 years old and would go ahead and work till the age of 65) instead of, say, 48 years of a 12thclass pass individual’s labour. The underlying assumption of this theory is that every skill is more or less reproducible. And anything that is reproducible should have a price commensurate to its cost of production; or rather, more specifically, its opportunity cost to the society.

Society loses 50 years of 10thpass unskilled labour; that is, it loses around 100,000 hours in 50 years, and instead gets 44 years, or 88,000 hours of an engineer’s labour. The society has to invest six extra years of skilled labour to make this individual an engineer. Assuming that the person has to study 500 hours per year, then in 6 years he has to study 3000 hours. If the teacher (assuming he is also an engineer) teaches, say, 25 students in a class, then the society, to create a single engineer, has invested 3000÷25= 120 skilled hours.

So what it essentially means is that 100,000 unskilled hours of class 10thlabour plus 120 skilled hours of investment to make an engineer equals 88,000 skilled hours of an engineer’s labour. Or in other words, 100,000 unskilled hours = 87,880 skilled engineer’s hours. Or value of 1 skilled engineer’s hour is equal to 100,000÷87,880, or approximately 1.15 unskilled hours of a 10thpass student!!

Now, if we were to tell this to an engineer, he would literally freak out. But the fact of the matter is that as a society, that’s approximately the engineer’s worth. So, as per my above calculation, the maximum wage difference between an engineer and a tenth class pass person can only be 1.25:1.

In this book, what you will read is nothing but a more detailed explanation of the same. For example, to teach the student for 120 hours, the teacher himself has to do research of added 120 hours. Similarly, there are librarians, research associates etc who also invest their hours; and the actual hours invested, instead of being 120, might be 360. Perchance some teachers may have Ph.D qualifications, so their hours are more valuable, and so on.

Actually, the final figure is far less ruthless than my calculation. It says that the maximum difference between wages can be 3:1. And if the cost of producing a scientist is only 3 times the cost of producing an ordinary labourer, then the scientist’s salary should also be a maximum of 3 times more than that of the labourer.

While Karl Marx said every human being should be paid according to his contribution in the society, the lack of a measuring tool of contribution is what left his theory vague. How do you measure the contribution of a scientist who invents a life-saving drug versus the man who comes and cleans your toilet? Leave it in the hands of free market and the ratio could be anything between 10:1 to 1000:1 or more.

But the reality of the matter is that the only reason the sweeper is cleaning toilets is because he wasn’t given perhaps as low as 5 to 7 years of extra education after, say, class 8th.

WHILE KARL MA RX SAID EVERY HUMAN BEING SHOULD BE PAID ACCORDING TO HIS CONTRIBUTION IN THE SOCIETY, THE LACK OF A MEASURING TOOL OF CONTRIBUTION IS WHAT LEFT HIS THEORY VAGUE

Post that, it’s just a matter of chance which scientist invents what in the next how many years. This, of course, requires sacrifice of individual arrogance that “I am so capable because I am by myself special” and replacement of the same with “I am so good because I got the opportunity to be trained by teachers and develop my qualities”.

To me, if the society believes this, then the theory outlined in this book is unbeatable and defines the foundation of a just society. In fact, every theory has a theoretical aspect and a psychological aspect. And I feel that even psychologically, a 3:1 ratio between the highest paid person and lowest paid person is a very just feeling as well. In fact, it is something that is in any case bound to happen in a free market capitalist system eventually.

Surprised? As we drift towards an economy where education actually becomes free thanks to the Internet, soon we will have a situation where everyone could be educated and no one would want to do the job of low qualifications – say, that of a sweeper. And then we are bound to see a sweeper or driver getting paid more than an engineer. Because the market demand and supply decides prices in the free market. And with an over-supply of engineers and scarcity of sweepers, the sweepers would be costlier despite being less educated. Of course, this would eventually lead to disincentive in being educated. And finally we will have a perfect competition where engineers and sweepers will perhaps be paid the same; even if the engineers are paid more, then the figure would be a psychologically acceptable 3 times more, unlike what it is now. The wage difference was skewed and differentiated till now in the world, as we know it, because education was restricted to a lucky few. So those with education could charge a super premium – or what we call a monopolistic supernormal profit. As Internet brings about prefect competition in every sector, things are changing rapidly. Poverty is no more a reason for remaining uneducated. Remaining uneducated will soon be a conscious choice we will make. After all, getting educated requires a bit extra effort than remaining uneducated. So, many people actually would not mind earning a third of what a highly educated person earns and choose to not put in the extra efforts in education. However, if he sees that the educated man earns 5 to 10 times or 20 times more, and if education is freely available, in all probabilities, he will get educated and bring down the prices of the educated lot.

One might, of course, argue: what about entrepreneurs? This brilliant book answers that too. One might argue, what about people with the same qualifications but who have better skills due to harder work? Well, for that, there will be wage cuts depending upon your productivity. Not additional wages. One might argue, what about specially and uniquely talented people? Well, I firmly believe in a fair and just society; they will be very happy earning three times more, plus additional non-monetary rewards and recognition. That’s what psychology says. No one has ever achieved greatness chasing money. People achieve greatness chasing their passions. And what they expect in return is recognition, especially if they are financially as stable as their other friends with whom they studied.

I am sure that whether you like or dislike the book, it will be hard for you to find a logical or humanitarian flaw within this treatise. Ever since I stepped into Malay Chaudhuri’s classes way back in 1989, I have nurtured the dream of such a society. This book – the manuscript of which became my most cherished gift on my 45thbirthday from the man who has inspired me the most in my life – reminds and inspires me yet again to dedicate the rest of my life to try and bring about a revolution around the world in order to make the dream come true of a fair world with 3:1 wage difference between the highest paid worker and the lowest paid worker.

I hope you all get as inspired and share the dream.

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