Unfair privileges and widespread corruption big problem

The reason is that various confusions may arise when talking about anything to do with socialism. It is now very difficult to give a specific or idealistic definition of socialism after the fall of the Soviet Union and economic liberalisation in China. The word socialism has been added at various times to the constitutions of South Asian countries including Bangladesh, Sri Lanka, India and Nepal. Socialism has also been mentioned in the fundamental state principles of Latin American and African countries where multiparty democracy exists. The question is-- how can the concept of democracy, market economy and socialism be adjusted?

After the end of the colonial rule during the nineteen fifties, some developing countries including India were seen tilting towards the ideology of socialism. The development strategies of these countries were an effort to follow the Soviet model of a planned and controlled industrialisation.

Although the main goal of such policy was growth and poverty reduction, it progressed very slowly over the next three to four decades. Later the development philosophy of pro-market economy and free trade changed everything in the eighties and nineties.

Immediately after independence, we ideologically adopted socialism apparently ever more strongly than India, especially about the proposed planned development and ownership of industries.

After the change of government in 1975, this chapter of economic policy came to an end. Since then till now, we keep silent about socialism, one of the main principles in the constitution.

On a small scale I have tried to show in the book that it would not be logical to show the market economy as an excuse for the failure to achieve the target of socialism. It is necessity to have the right policy and political will to turn the market economy public welfare-centric. It is notable that in the western countries, especially in the United States, disparity of assets and income has not increased, rather decreased till the 1970's after the World War-II.

There was a competition to give capitalism a humane face in the industrially developed countries of the West which were against the socialism. Various social safety net programmes, income redistribution tax system and Anti-Trust Law to prevent monopoly in business were parts of the initiative. But those policies and steps were changed in the interest of elite class and big corporate businesses since the 1980's after the emergence of the philosophy of free market economy and the end of 'Cold War' with Soviet Union. As a result, capitalism appeared to be extreme, which some term 'hyper capitalism'.

'Income beyond various legal sources' is the main reason of disparity of income and assets in the current capitalistic global economy.  We are insignificant part of that system in the era of globalisation.

The relationship between unearned income and the initiative of competitive market and the incentives is meager. 

In this mode of production, offering different facilities to multinational companies, commercialisation of innovations through patent rights, extraction of natural resources through environmentally destructive investment, establishment of the monopoly market of several products and the extension and dominance of the financial sector are deemed as the sources of unearned incomes for the industrialised nations.

In our country, nepotistic industrialisation, political culture of offering unethical facilities and unabated corruption are held responsible for the unearned income. If these sources are stopped, then the competition and incentives of the market economy will increase further.    

More or less some concepts about the goals are generally applicable. For example, fundamental needs including education, health, accommodation and employment of workable people have to be fulfilled. Universal social safety programmes for least livelihood have to be in place. Moreover, human rights, freedom of expression and democratic values are expected in a welfare state.

Besides, an additional logic in favour of democratic socialism is that a democratic liberal environment is more helpful for incentives and growth of the individual initiative than a repressive, tough administrative system.

There are differences over the matter among the theoroticians. However, two conditions of justice can be given from the socialism point of view. First, there must be equal opportunity for all and second, the most under privileged people have to be provided additional facilities. The second condition is important. If there is no minimum ability of livelihood, families face difficulties to utilise the opportunity of education for their children. When the leftists view the poverty as a flaw of market system or the rightists blame the lack of qualification and initiative of the persons, both the camps ignore one thing. Financial failure and poverty can happen due to the fate and in that case the state has the ethical responsibility ensure social safety.

Our big problem is massive tax evasion. Moreover, a big portion of economy is in the informal sector and out of the tax net. We will not be able to increase the rate of revenue income near the rate of Scandinavian countries if we try. However, we have to utilise the opportunities and think over new things. Like many developed countries, there is no tax on inherited properties in our country, although there is wealth tax, its application is faulty. As a result, the disparity is created due to the wealth earned unethically, that descend generation after generation.

The concept is not quite new. Young progressive portion of Labour Party in Britain wanted to include a proposal in their election manifesto during eighties and nineties. They termed it 'democracy of wealth-share'.

During the tenure of Obama and Trump, the US government bought shares of financial and industries to save them from bankruptcy during the recent financial collapse. Later the companies were allowed to buy those shares. Instead the government could earn revenue from the profit retaining the shares.

There is more scope to implement this concept in the weak banking system like ours. It is seen the companies of big business conglomerates become defaulters in paying loans. One of the reasons is to siphon off money illegally. As a result, loans of these companies are rescheduled repeatedly and loan rebate facilities are given to save the business entities. But instead of it, as part of financial assistance, the government can buy shares of these companies in face value. Moreover, if good companies float shares in the market, the government can buy a portion in competitive price by formulating laws. But there must be certain conditions that if there are representatives in the board of companies, they will have no voting power or they will not be able to interfere in the companies.

So, there is no fear of going back to the bitter experience of state-run businesses. Apart from this, the profits will have to be spent for social welfare through forming an independence trust without any unexpected political interference.

Especially energy, transport, power and technology should be partially kept under the ownership of the government. Otherwise, a scope of business monopoly will be created under the private sector or necessary private investment may not come.

But how the capacity of operating these state-owned commercial organisations and the incentive and accountability of the officials will be ensured, that is not easy to determine. There are both bad and good experiences in different countries. In Malaysia, completely state-owned oil and gas company Petronas is a successful example.

The government receives more than USD 10 billion as profit per year from this company established in 1974. 

The steel-making company, Posco, the South Korean government established in their country in 1973 has contributed a lot to the country’s industrialisation. The government also earns a hefty amount of money per year from its 70 per cent share in the company.

But there is an opposite scenario too, which was shown in a popular movie titled Blood Diamond, that is: how the western multinational companies are looting the resources from the mines of some African nations in collusion with the local influential groups. The mining is causing a catastrophic effect on the lives and livelihoods of people living nearby.     

Right to the universal quality basic education and merit based higher education is an essential condition in creating equal opportunity. South Korea had been able to achieve faster growth without increasing disparity of income, developed human resource had an important role behind it. Ensuring employment of all able citizens is a goal of socialism, there is a direct link with education plan. Such a human resource needs to be created through the education system, which is relevant to the demand for economic development. Otherwise there will be a crisis of educated unemployed.  There are some measures in India or Bangladesh to ensure the employment of physical labour as part of social safety net programme. But the problem of unemployed educated people is different. The government's allocation for education sector is an important matter. In case of ensuring right to education, the private sector can be complementary to the government sector, but it cannot be an alternative. In the developed country, the public expenditure in the education sector is 6 to 7 per cent of gross domestic product (GDP), which is near 4 per cent in India, China and Vietnam. But it is only 2 per cent in South Asian countries including Bangladesh.

That is true. For example, if we estimate pre-tax income of rich people and estimate income disparity by deducting the social safety facility of low income group, that is equal to the US, even may be higher. If we collect revenue as much as possible and introduce income redistribution income tax, we will not be able to reduce disparity like the Scandinavian countries. For this, we have to think to make marketing system pro-society.  Muhammad Yunus has created a model of social business, where earning profit is not the main goal of business establishment. Besides, there are various pro-society model of business establishments. Once the production model conducted by factory-based workers association in Yugoslavia achieved adequate success.

These matters have been written in the book, which cannot be said in a word.

The most important thing is to organise the vulnerable section of the people in a bid to establish economic equity and justice. This is an essential political process to introduce the democratic socialism, which I have not discussed in the book. In this regard, discussions are being taking place over associative democracy, the subject of that as to how democratic system can be decentralised and due citizens' rights of different class and quarters can be ensured at the grassroots level through the representative association. For example, these associations can play role in protecting assets from the middlemen like marshes or open waterbodies usable by the general people. Any political party committed to democratic socialism in association with such organisation can create public support. Very good results cannot be expected only with theoretical and ideological campaign.

The democratic socialism that has been mentioned in this book is not a part of any specific ideological doctrine. Rather some elements of socialism has been mentioned as those can be implemented separately, which can be made effective in certain degree. However, it is difficult to say when and in which country this scope will come. Besides, there are some risks too.

Thank you too