The way that Congress and the President structured America’s coronavirus bailout legislation, the protections that go to the super-wealthy start immediately, but the protections that go to the neediest — the soaring numbers of unemployed, the increasingly endangered medical workers, etc. — require documentation which is creating delays that might soon cause many of these individuals to lose their homes, their cars, even their lives.
On April 17th, Matt Taibbi headlined “The Trickle-Up Bailout” and he noted that:
As we head into the second month of pandemic lockdown, two parallel narratives are developing about the financial rescue.
In one, ordinary people receive aid through programs that are piecemeal, complex, and riddled with conditions.
A law freezing evictions applies to holders of government-backed mortgages only. “Disaster grants” are coming more slowly and in smaller amounts than expected; small businesses were disappointed to learn from the SBA early last week that aid would be limited to $1000 per employee.
As I had already explained on April 14th:
America’s bailout package to overcome the coronavirus ‘recession’ is twofold:
One part is printing money for employees and consumers, so that they won’t be thrown out onto the streets for non-payment of debts such as mortgages, car-loans, credit cards, and student loans.
Another part is printing money for bondholders and stockholders, so that their investments will still have value and there won’t be panicked selling of them as corporations accumulate soaring losses because consumers are staying home and are cutting way back on expenses.
The top-down part of the bailout (the part for investors) will merely add to the wealth of the already-wealthy, while everybody else sinks financially into oblivion. (On April 9th, the Zero Hedge financial site explained in detail why even bailing out the airlines would hurt the economy more than help the economy.) The top-down part supplies the money to the corporations instead of to their employees and consumers, and is therefore supply-boosting instead of demand-boosting. Supplying money to the corporations that the Government selects to protect will enable those corporations to buy up assets and corporations which during the crisis are being auctioned off by the ones that go out of business, and this will leave the nation’s wealth in even fewer hands than before the epidemic struck.
The bottom-up part (the part for workers and consumers) will be exactly the opposite of that: it will help prevent another Great Depression. By boosting purchases, instead of bailing-out billionaires and such, it will enable the economy to keep functioning, and it will not increase the concentration of wealth.
However, employees and consumers don’t have many lobbyists, but billionaires do, and billionaires also own (through political donations and lobbyists) almost all members of Congress (and also the mainstream press), and they not only own, but are represented by, one inside the White House, who is surrounded there by others, and by representatives of others, so that the concerns of the wealthiest will be very well represented by America’s Government, and will end up dominating the bailouts, so that only the insiders, who are well-connected in Washington, will be protected. (And Joe Biden would be no improvement over Donald Trump, though his rhetoric is different.)
Already, we see, in the ‘news’-reports, that there is ‘chaos’ etc. in the U.S. Government’s response to the crisis, but what’s not being reported in the mainstream ‘news’-media is that there very much is method to this seeming madness, and it is the method of the well-practiced and well-funded takers, definitely not of their victims, from whom they (and their Government) have been, and now increasingly are, taking. The takers own the Deep State, and are protected by it. The vast bulk of the bailouts will go to them. The vast bulk of the bailouts will go to suppliers (investors), not to their workers and consumers.
So, as a general rule: the more that a person’s income depends upon investments, and the less that it depends upon their labor (wages), the more fully that the bailouts will compensate for the losses they’ll be suffering as a result of the coronavirus disruptions.
Here is a breakdown of the incomes that the super-rich receive (mainly from investments), versus the incomes that everybody else receive:
As can easily be seen there, only the super-rich (the top 1%, and most especially the top 0.1%) receive the majority of their incomes from investments (“Business income” and “Capital income”). Everybody else receives it mainly from “compensation” (wages), “retirement income,” and “Transfer income” (welfare).
Most of the benefits to the top 0.1% will be coming by means of monetary policy, via the Federal Reserve, not by means of fiscal policy — such as the payments to the unemployed (which are subject to many delays) and such as the $1,200-per-adult grants (which were the fastest to be paid because it’s the “helicopter money” that buys votes for the political incumbents, all of whom had voted for the bailouts).
The bailouts’ widely publicized part is the $2.2 trillion, since that includes whatever the public gets. However, that part is the smaller portion of the entire program. As CBS News reported on March 24th, “Top White House economic adviser Larry Kudlow said the price tag of economic stimulus amounts to roughly $6 trillion, which includes $2 trillion for direct assistance, and roughly $4 trillion in Federal Reserve lending power. Kudlow said this will be the single-largest such Main Street financial package in the history of the country.” Kudlow said it at a White House press conference. He mentioned there just in passing (at 1:36), that it’s a “six trillion-dollar program, four trillion dollars in lending power from the Fed, that’s a six trillion-dollar package …,” and the reporters in the White House press corps didn’t ask him anything about the Fed’s part, the $4 trillion portion (the program’s part that protects the billionaires); they evidently didn’t care about that, but only about the $2.2 trillion, which is actually the PR decoration on this $6T cake — the $2.2T that the public is interested in, the bait-part of the entire bailout-program. (Its hook won’t sink in until the readers’ children and grandchildren will be paying for it via their taxes in a stripped America.) However, on March 26th, Wall Street on Parade (WSP) — the best investigative-reporting source about Wall Street — headlined “Stimulus Bill Allows Federal Reserve to Conduct Meetings in Secret; Gives Fed $454 Billion Slush Fund for Wall Street Bailouts” and disclosed that even what Kudlow had called “Main Street” (the $2.2T part) included much for Wall Street; and WSP then rhetorically asked, “Why does the Federal Reserve need $454 billion from the U.S. taxpayer to bail out Wall Street when it has the power to create money out of thin air and has already dumped more than $9 trillion cumulatively in revolving loans to prop up Wall Street’s trading houses since September 17, 2019 – long before there was any diagnosis of coronavirus anywhere in the world?” They promptly answered this: “The Fed needs that money to create more Special Purpose Vehicles (SPVs) — the same device used by Enron to hide its toxic debt off its balance sheet before it went belly up.” Furthermore, the $454 billion, which WSP called “the money the Treasury is handing over to the Fed” is what CBS had reported “would result in ‘$4 trillion in Federal Reserve lending power’.” And U.S. taxpayers are guaranteeing 100% of these loans to investors — so, it’s “heads you win, tails we lose,” for taxpayers addressing billionaires, and “heads we win, tails you lose,” for billionaires addressing taxpayers. The billionaires win, the public loses. But the billionaires’ media don’t mention this fact, that investors get the guarantees, while the public takes all of the risks. However, what is an “investment” for, if non-investors are receiving its risks? It’s just legalized crime. And these are huge risks, and all or most of the $454 billion that the U.S. is lending to the Fed to guarantee private investors’ investments could be destroyed in the coronavirus-crisis. This is far more socialism for the super-rich than for the bottom 99%. The billionaires love socialism when they’re the ones who are getting the bailouts — the public taking on the risks that investors are supposed to assume. The issue for billionaires isn’t “socialism versus capitalism,” like they always say; it’s actually “socialism for us, and capitalism for everybody else.” That’s not “survival of the fittest,” for the wealthiest class; it’s instead their ordering their politicians to: protect our wealth, no matter what the cost to the public could turn out to be. And that’s precisely what the President and Congress did. Kudlow, however, said, instead, that the “package” would produce “a good rebound in the second half of the year.” Maybe for the billionaires it would.
Kudlow was simply being consistent with his own prior record. On 10 December 2007, he had headlined in National Review, “Bush Boom Continues: You can call it Goldilocks 2.0. But you can’t call it a recession.” And he closed by saying, “This sort of fiscal and monetary coordination will continue the Bush boom for years to come.” He’s good for the billionaires; and, so, today, he’s President Trump’s top economic advisor. He’s up there, because he’s wrong — not because he’s right. (If he had been right, he wouldn’t be there.)
On April 21st, CNBC headlined “Here are the largest public companies taking payroll loans meant for small businesses” and the top 10 on the list totals $56.5 million going to 10 corporations whose collective market capitalization is $2.367 billion. The smallest of those ten bailouts is $10.0M going to the stockholders of a $151 million corporation. The largest of those ten bailouts is to a corporation whose top 3 investors are: Brown Capital, BlackRock, and Vanguard. On April 20th, Forbes reported that, “the U.S. central bank has hired private equity giant BlackRock BLK, which manages some $7 trillion in assets, to run purchases of corporate bonds and commercial mortgages that are part of its response to the pandemic-led recession.” So: the owners of BlackRock will now receive, from “the U.S. central bank” (the Federal Reserve), some of the bailouts from the U.S. Small Business Administration, in this “emergency” program.
Also on April 21st, David Sirota’s blog bannered “Dems Give Unanimous Consent To Trump”, and described the just-passed second coronavirus bailout legislation, which totals $484 billion: It “doesn’t include any resources for first responders, budget-strapped states or food stamps. It doesn’t include any new oversight of the first bailout bill. It includes nothing to help states move to a vote-by-mail system in the event that coronavirus complicates in-person voting during the general election. It basically doesn’t include any alleged Democratic Party priority at all.” But the legislation passed Congress with “unanimous consent,” in this ‘compromise’ with the Republicans (who oppose any government-benefits that might go to the poor).
After the immediate crisis is over, America will have a top 0.1% who are unscathed and whose mega-corporations will be selling not only what they had been selling before, but selling virtually everything that sells in the post-coronavirus world. For examples: what mom-and-pop businesses (including restaurants, B&Bs, etc.) had previously been selling, will, in the future, be supplied (to the extent that it remains being supplied at all) by McDonalds, Starbucks, Marriott, Amazon, Target, Walmart, and other megacorporations (controlled by billionaires), which will have been receiving, from the Fed, and from the Treasury, whatever they needed in order to carry their investors through the crisis-period. (And who are those investors? Look at that chart above, the recipients mainly of “Business income” and “Capital income” — the chief recipients of dividends, interest, and capital gains incomes.)
Furthermore: after the crisis, commercial real estate will be super-cheap, because of all the bankrupted mom-and-pop businesses. Wages also will decline, as the public become increasingly desperate, and the billionaires win increasing market-power. Therefore, not only will the megacorporations be selling a larger percentage of the national output, but their expenses will go down.
Consequently: America will have lots more poor people, and lots wealthier billionaires.
This, however, will be only a temporary situation, because the enormous spread of poverty will result in greatly decreased taxes coming into all levels of the U.S. Government. Bridges will collapse, potholes will proliferate, unendowed colleges will close, nervous breakdowns and heart-attacks will increase, and thus the public won’t be able to spend as much as they were spending before the crisis hit. And, so, although the megacorporations will be selling a larger percentage of national output, that national output will decline, because of the spreading poverty. Therefore, even the billionaires won’t necessarily become richer than they were before the crisis hit.
All of this outcome is unnecessary and results from corruption. The only reason why there is any bailout, at all, for investors (in anything other than pass-through entities), is the pervasive governmental corruption at the very top. If there were no corruption, then the only bailouts would be to individuals and pass-through businesses (which are individuals) — the “bottom-up” bailouts. America is a very corrupt country at the top, and that is the reason why it will collapse in the aftermath of the coronavirus crisis.
Ultimately, when the wealth-inequality is so extreme, the billionaires are selling mainly to each other, and the necessities for the public are less and less profitable to sell at all. The outcome will therefore be economic collapse, and perhaps even revolution.
The basic way to evaluate how well or poorly a nation’s Government is performing in this crisis is the country’s ratio of coronavirus cases to its total population, but if a given country has not yet reached its peak in its daily number of new cases, then that country’s ratio is probably still rising, in which instance, that country’s performance will probably turn out to have been less good than this ratio currently is showing it to be. And, conversely, the lower this ratio is, the better the performance of that country’s Government is shown to be in responding to Covid-19.
Here are the ten nations that have the largest numbers of cases at the present time, and the ratio of that number to their total population; and also shown here is the date when the daily number of new cases peaked (because if it hasn’t yet peaked, then this crucial ratio will probably be rising in that country):
Ratio of total cases to total population, per million (the lower this number, the better):
USA = 2,472 maybe not yet peaked
SPAIN = 4,367 peaked March 26th
ITALY = 3,043 peaked March 19th
FRANCE = 2,421 peaked April 3rd
GERMANY = 1,772 peaked March 27th
UK = 1,901 peaked April 10th
TURKEY = 1,133 peaked April 11th
IRAN = 1,010 peaked February 12th
CHINA = 57 peaked March 30th
RUSSIA = 362 maybe not yet peaked
In addition, the following major countries might especially be noted, since the main reason they aren’t on that list is their being outstandingly good performers:
JAPAN = 88 peaked April 11th
S. KOREA = 208 peaked March 3rd
The worst of all these performers appear currently to be, though not yet in any clear order: USA, Spain, and Italy.
The best appear to be, in order: China, Japan, and S. Korea.
Regardless of a country’s size, here are the absolute worst performers, and their respective known infection-rates per million: San Marino (14,028), Andorra (9,280), Iceland (5,210), Gibraltar (3,918), Faroe Islands (3,786), Isle of Man (3,610), Belgium (3,534), Ireland (3,248), Switzerland (3,243).
The U.S. press has recently been particularly praising Denmark’s performance, and noting that Denmark’s coronavirus emergency legislation is more socialistic than Sweden’s is. However, both of those Scandinavian countries actually have very similar actual performance, thus far, in this crisis. In Denmark, the focus of the emergency legislation was on “saving jobs,” instead of on protecting investors. It’s a democratic socialist country, perhaps the most equalitarian in the world. Of course, that’s the exact opposite of dictatorial capitalism (fascism), which became America’s system after FDR died in 1945, and increasingly thereafter (hyper-imperialistic, military-industrial-complex or “MIC” dominated, like fascist regimes usually are), perpetrating coups and invasions, destroying Iran, Iraq, and many other countries, in order to expand its power and the wealth of its billionaires (like the fascist countries had done going into WW II). No cases of coronavirus-19 were reported in Denmark until February 27th. Denmark unanimously passed its emergency law on March 13th — drastically different bailout legislation from the one that America subsequently passed — in order to deal with the crisis. The daily number of Denmark’s new Covid-19 cases peaked on April 7th, and has been declining since that time. Its neighbor Sweden peaked on April 8th. Sweden’s emergency legislation is less strict about lockdowns, but relies more on individual discretion. However, since Sweden, like Denmark, is a democratic socialist country, individuals needn’t worry about paying medical bills, nor about being paid while on sick-leave. So, employees aren’t desperate to return to their places of work, such as in America; and, therefore, these countries don’t spread the infection as readily as in the U.S. and are thus far less likely to have recurring peaks and delayed terminations of the coronavirus crisis. (By contrast: in America, where losing one’s job can mean losing one’s health care, even sick employees may be inclined to stay on the job and perhaps infect customers.) And there are no corporate bailouts in either Denmark’s or Sweden’s legislation. Denmark’s Finance Minister, the Social Democrat (or democratic socialist) Nicolai Wammen was interviewed for 15 minutes on March 27th, by Christiane Amanpour, and he explained Denmark’s emergency law, which was overwhelmingly bottom-up, not top-down (such as America’s is).
Here, therefore, is the actual performance, thus far, of both of those two countries:
DENMARK = 1,329 peaked April 7th
SWEDEN = 1,517 peaked April 8th
Both of them are reasonably comparable to Germany, UK, Turkey, and Iran, but not as good as S. Korea, and not nearly as good as the two best, China and Japan.
In the final analysis, China and Japan could turn out to have the least-corrupt and best-run Governments; and the most corrupt Governments could turn out to be USA, Spain, and Italy. However, the performances of Brazil and some other nations in the southern hemisphere might yet turn out to be even worse than those of USA, Spain, and Italy, because the winter season has’t yet reached there.
Another important way of measuring a nation’s coronavirus performance is tests per million population. Among the nations with the largest numbers of cases, Italy and Germany are excellent on this, having above 20,000 persons tested per million population; and China is the worst (because it doesn’t even say how many were tested). Consequently: China’s outstanding performance (as measured by low number of reported cases) might actually be fraudulent. Japan’s outstandingly low number of reported cases might also be fraudulent, because their test-number per million is only 923. America’s test-rate is in the mid-range: 12,651. Denmark’s is 17,358. Sweden’s is 9,357.
What cannot be reasonably doubted is that America’s Governmental response to the coronavirus-19 pandemic is catastrophically corrupt. On April 16th, Wall Street on Parade headlined “Here Are the Contracts Showing How $4.5 Trillion in Stimulus Was Outsourced to Wall Street” and described — and documented — what the Wall Street Journal and the rest of the financial press would not, which is the U.S. Government’s legalized money-laundering operation, via the Fed, transferring onto the American public almost all of the losses that America’s billionaires will be suffering from the coronavirus crash. Back on 21 January 2020, WSP described this money-laundering, in its earlier 2008 embodiment, this way: “The epic financial collapse on Wall Street in 2008 was, reduced to its basic terms, simply the end game of Wall Street banks’ efforts to monetize their frauds.” They noted: “On April 9, 2019, the nonprofit Wall Street watchdog, Better Markets, released a study titled: “Wall Street’s Six Biggest Bailed-Out Banks: Their RAP Sheets & Their Ongoing Crime Spree.” It should have made headlines on the front pages of every major newspaper in the U.S. Instead, it was effectively ignored by mainstream media.” (Incidentally: Obama repeatedly promised to prosecute banksters, but secretly protected them and prosecuted none of them, though their crimes had been monstrous. The billionaires’ thefts from the public are entirely bipartisan, supported by over 95% of Congress — the billionaires own the Presidents and members of Congress, and not only own virtually all of the news-media.) On April 20th, America’s National Public Radio (NPR) broadcast “Amid Pandemic, Italian Prosecutors Warn That Mafia Groups Are Cementing Their Power” and reported that Mafia bosses were buying up cheap some of Italy’s suddenly desperate small businesses. If the same thing is being done by America’s billionaires, that’s not yet being reported by their press — perhaps it will instead be reported by Italy’s press.
The Federal Reserve are controlled by and represent the banksters — Wall Street — who not only skim on their own accounts but work with and for the billionaires, some of whom are themselves banksters, but many of whom are operating hedge funds, private equity funds, and all types of FORTUNE 500 companies. Basically, Wall Street works for the billionaires. The billionaires run practically everything in America, except Main Street.
In the upcoming June 2020 issue of the neoconservative (pro-U.S.-imperialist) Democratic Party U.S. magazine, The Atlantic, their George Packer banners “We Are Living in a Failed State: The coronavirus didn’t break America. It revealed what was already broken.” That magazine blames this “failed state” on the (neoconservative) Republican Party, and so Packer’s phrase there “a dysfunctional government” links to an anti-Republican article, by one of the top officials in the liberal neoconservative U.S. Administration of the Democrat Barack Obama, titled “How Trump Designed His White House to Fail.” However, the actual cause of the gradual collapse, since 1945, of what had been U.S. President FDR’s largely democratic U.S.A., is the billionaires who own both Parties — it is bipartisan. This rot comes from both Parties’ billionaires. (The particular propaganda-operation, The Atlantic, happens to be controlled by the same Democratic Party billionaire who controls Apple corporation.) No billionaire will publish the reality. For example, Packer’s article said: “The second crisis, in 2008, intensified it [‘a bitterness toward the political class’]. At the top, the financial crash could almost be considered a success. Congress passed a bipartisan bailout bill that saved the financial system.” The presumption there is that the only way to restore the economy after a crash is to bail out the country’s billionaires. It’s a timely propaganda-message, at this moment when the billionaires require their Government to bail them out, yet again. (I recently proposed one way to reduce the billionaires’ dictatorship over America.)
On April 17th, WSP headlined “Americans Are Paying a Tragic Price for Allowing Five Banks to Control the U.S. Economy” and closed by urging: “Americans need to use this time at home to call their Senators and Reps in Congress and demand the separation of federally-insured, deposit-taking banks from the casinos on Wall Street. We’re talking about nothing less than the survival of this country.” Needless to say, the ultimate beneficiaries of this public largesse — to America’s billionaires — don’t desire to publicize such writings, any more than they desire to expose to the public their offshore bank accounts.
Unlike so much that’s in the billionaires’ ‘news’, the facts that are reported here are solidly documented (and linked-to), but the billionaires don’t report these facts. Thus, the masses don’t know these facts, and so the mass-violence, when it comes, won’t be focused against the billionaires. What you’re reading, here, is being kept secret by (not being published by) the billionaires’ media. So — if only in order to spread word that the cause of this is not “the Chinese” or “foreigners” or “the Jews” or some other amorphous ethnicity (who aren’t actually to blame) — please email the URL (the web-address) atop this article, to all of your friends, as “FYI:”. It might stir some interesting conversations, especially if all the ‘news’ that they know comes from America’s billionaires — the same people who fund the country’s successful politicians, each and every election-year. The American Revolution did not come about by misinformed people. It came about by informed people. Misinformed people create only more problems.
So, that’s “FYI.” And thanks for reading here.
Covid-19 and Implications on India’s Savings
India has announced its new industrial policy in the year 1991, but Indians never deviate from their traditional character of saving their money in various ways. For example – children are trained to save through saving boxes as a habit. Most of the people who belongs to middle class invest their money in chit funds, postal savings and bank saving accounts, employee’s provident funds, equity market and bonds. Though the LIC credibility has gone down very badly by the policies of the Modi’s government, still Indians believes even today the LIC policies more than the government. The new industrial policy in 1991 was about to privatize the sick public sectors, liberalize the economy for fresh investments and finally to face the challenges of globalization. This was the idea behind the new policy.
However, it was well clear during that time global economic environment was also one of the reasons for India to announce the new Industrial Policy in 1991. During that time India had sever foreign exchange crisis due to the Iraq war. Indian expatriates in the Gulf region were forced to vacate their jobs. This caused fast dry in our forex reserve and struggled to face the import for the following month.
The present scenario reflect what happened before, and is still caused by the Covid-19 pandemic. Indians working abroad are made to leave their jobs including US, Europe, South East Asia and Gulf region. People in these places who cannot sustain their job anymore like to be back in India. Indian government also through various ways, is bringing the stranded Indians back home. We all know that the growth is completely down. Expatriates sending money to India is also now declining fast. However, now we have comfortable forex reserve of US$ 513.25 billion as on 10thJuly 2020. So we need not panic and also the present scenario cannot be compared with the 90s.
However, the mass exodus of Indians from the Gulf will be one of our great worries if the situation will not change in the next six months. Especially in the Southern states these money was invested and saved in various ways to help the growth of the local economy. The present unexpected crisis due to the pandemic will be gradually responsible for halting the flow of money from the Gulf. Thus can cause damage in regular savings and spending for the Indians. Let us analyze how the Covid-19 crisis is going to have an impact on India’s savings.
Remittance from the Gulf region
The recent report of the Ministry of Overseas Indian Affairs states that India receives remittance from approximately more than 35 million members of the Indian diaspora living abroad. Moreover, India retained its position as the world’s top recipient of remittance. In 2018 India received $79 billion as remittance from the India’s expatriates (Economic Times).
The Indian community in the Gulf region alone annually contributes around 53.5 % of the total remittance to India (factly.in). In the year 2016 India received $62.70 billion, and in 2017 $68.968 billion from the Indians abroad. The high remittance from top three countries during the year 2017 are the UAE $13.823 billion, US $11.715 and Saudi Arabia $11.239 respectively. Apart from these countries remittance flow from Kuwait is also impressive. In the year 2017 India received $3.016 billion, and in 2018 $4.8 billion from the Indian expatriates in Kuwait.
Interestingly 19% of the total inward remittance to India goes to Kerala (factly.in). So it would be understood that if remittance stopped sending money then obviously the implications naturally would severe for the receiving states. The recently proposed legislation to curb Indians in Kuwait is a worrisome matter. The Kuwait Government’s decision to “limiting the number of Indians not to exceed more than 15% of the total expatriate population” is sure to have an impact on India especially the state of Kerala. Already India is facing an unemployment rate mounting to the highest in 45 years. Jobless growth is not at all good for a country like India having huge population. The Modi administration should take this clarion call now. India should use our special diplomatic relationship with the Kuwait to sort out this emerging matter which is going to affect a number of Indian expatriates living and working in Kuwait. It is the right time to articulate diplomacy to keep India’s interest in the issue of Kuwait’s new legislation curbing Indians in the job market.
India’s savings and economy
Indian households contribute to about 60 per cent of the country’s savings. Auditor Gurumurthy says, “Saving culture is unique and a habit for Indians” (Business Line). Further, he says, “India’s growth will come from domestic savings” (The New Indian Express). Though we have differences of opinion about this statement, but it is true that Indians save more. It is clear that Indians never work to celebrate the weekends.
At the same time India’s savings plunges to 15 year low due to the slowing economy (Economic Times). It is true that the slowdown in the Indian economy is also one of the reasons for the fall in savings. But the covid-19 issue has also halted the consumers as not to spend more or save. This is because an uncertainty glooms all over the world since January 2020. Hence, everyone is determined to run their families more cautiously than the pre-covid-19 times.
However, experts also agree that “The Covid-19 uncertainty, causing rise in forced savings and slow spending” (The wire). Many of us now have turned blindly to increase our health insurance is a well-known fact. Well, this is the need of the hour. No one can deny it. At the same time the ordinary people have to spend cautiously. This is because the lockdown causes halt in job creation. Factories are closed. Moreover, cuts in salaries and specific focus for health care related consumption which is actually new to our society. All the above said factors impacted on India’s savings and consumption activities. RBI study reveals that the Covid-19 related hardships made people to borrow more. If this has been the scenario, then obviously it will affect the normal Indian’s life and there will be nothing to save for the ordinary people.
It is vital clear that the Covid-19 issue has a deep impact on India’s ordinary people’s savings. Until the people experience normal life again, there will be no way to save money. Health expert’s opinions are contradicting. Even the WHO could not give a clear picture about when the normal life will resume. At this juncture savings in India will decline further. People don’t have money to save. If the present situation prevails for another six months then people will be forced to take their savings to buy essential goods for their survival. This is quite natural. Covid-19 has made it a hard time for ordinary people to take extraordinary risks for their survival. It means the pandemic causes huge implications on ordinary Indian lives and their savings.
Pandemic Recovery: The Re-Hatching of Economy
Re-hatching needs new eggs; when was the best time to create national upskilling models and quadrupling exportability and nest eggs? When was the best time to mobilize national gatekeepers of trade and commerce on rethinking of trade-groups to focus on showcasing and discovering of hidden grassroots talents over blind globalization? When was the best time to “digitize” the nation…it was a decade ago. When was the best time to “design”…productivity, it was also decade ago. We need new eggs.
Some harsh questions; nation by nation depending on the level of crisis on economic fronts, are cities and national regions ready for national mobilization of entrepreneurialism? Are national Associations and Chambers in agreement on upskilling small medium enterprises? Is there a national agenda to quadruple innovative excellence and exportability? How simultaneous synchronization uplifts upskilling and reskilling of 1000 to 100,000 SME on a fast track basis? How can Roundtable discussions LIVE streamed to 100,000 stakeholders within a nation instantly create a national umbrella? How will Mobilization of Entrepreneurialism across a region or nation and uplifts the SME base?
Why understanding of pandemic landscape by Public Sectors of the world so critically essential?
Why nation-by-nation, upskilling of governments and institutional bodies is far more important?
Why digital platforms on upskilling will solve such serious deficiencies on fast track basis?
The hatching also needs a nest; 50% downtown of the world may not survive, 50% of tall office towers may go empty, 50% of office workers may work remote, 50% downtown retail shops may not survive, 50% economies may lose a decade to recover, 50% small medium businesses may go bankrupt…50% nations are in serious difficulties…
Let us say we do not have a proper nest and problems may linger many years…
More harsh questions; when the last open national debate on Futurism is Workless? What was mobilization activated on creating national programs on critical thinking, complex problem solving? How global age understanding of global collaborations, dealing with diversity, tolerance installed in Public Sectors? These simple notions backed by global technologies and now fully endorsed by Covid-19 as the only working model for going forward. Deeper study required by all corner office holders of Public Private Sectors of the world as downtown go dim and suburbia re-shines.
The re-hatching; there is “No” time to waste on any justification; no time to complain as it is a sign of incompetence, now is the time of action and solid competencies. Deploy digitization of Top national trade Associations, Chambers of Commerce to upgrade to excellent digital platforms so that their entire membership can skate nationally, and globally highlighting their goods and services. Apply “National Mobilization of Entrepreneurialism Protocols” This is a global age revolution based on entrepreneurial mobilization… study Pentiana Project. There are special sets of skills required to uplift midsize business economy during pandemic recovery. Study deeply. Solutions already spread around the world. National leadership on such call is missing. Study more on Google
The new flying paths; why digitization of economies still such a nightmare after a decade for almost free technologies available in abundance; because today, any open discussion in any major department anywhere in the world immediately exposes some 50% redundancy of surrounding staff and 50% incompetency to deal with the required challenges. Everyone is scared to talk about anything to activate any change, if digital absolutely frightened to talk about ‘upskilling’ for fears of being exposed, staying ‘Mum’ is the word, hide under the desk and appear busy in deep silence. Welcome to the reality check and get ready for the march of billion workers.
The flight of the billion; next item on the global pandemic agenda is to cope with billion jobless, workless, officeless,, masked and unmasked working citizenry marching on main boulevards of the big and small cities of the world as national leaderships across some 200 nations of the world have limited time to get ready. The disconnected, debased and unemployed are looking for something more than a press conference or a well-rehearsed teleprompter show; they are not concerned for being locked-in but rather angry for locked-out of any grassroots prosperity. They already know the economic limitations and level of performance of their own local governments and therefore seeking hardcore intelligent, workable, honest answers with long-term plans of the future.
They are coming out in disappointments, wrapped in anger, but more about themselves for letting their skills and crafts miss the boats, their degrees and experiences now not trade-able, their burden of debt, guilt and sorrows unbearable, some fought health crisis, some survived body bags, lingering in sadness, seeking truth and answers, they wander the world remotely. The time has also come to embrace upskilling and uplifting of women entrepreneurs all across the world, as they are the other missing wheel of the national economy. Follow the trail of silence on such matters.
On re-hatching economy, the displaced have real issues and they need real help. They know charities will not last; real deployments of solutions and real mobilization of methodologies are the only long-term answers.
They need answers and not riot gears,
They need truth and not theatrics.
They need grassroots prosperity and not hologramic economies
They are re-hatching and now need brand-new thinking and new style leaderships
The rest is easy.
Dynamics of Current Global Economic Crisis
Global economic architecture is fundamentally weak and fragile and having multiple internal contradictions which emanate in different economic and financial crisis in different time periods, H.P Minsky. Similarly, Marx asserted, sustainability of existing hegemonic economic structure depends on continues revolutionizing and modernizing of means of production and more exploitation of labor. However, because of this process the absolute and relative surplus value is generated which creates wealth. Additionally, because of the destructive patterns of the global structure the wealth shifts in the few hands, which makes and favors the global elite and sends rest of the society in the swamp of hunger and poverty.
Moreover, because of this mechanism, phenomenon of industrial reserve army emerged which creates problem of permanent unemployment and cause reduction in demand and later manifest in the form of crisis i.e. economic or financial crisis. Nevertheless, credit crisis of 1772 which was originated from London and quickly spread to rest of Europe. The great depression of 1929-1939 which is considered the worst economic and financial disaster of the 20th century begin with the wall street crash. OPEC oil price shock of 1973. The Asian crisis of 1997 which is also known as Asian flu which began from Thailand and quickly spread to east Asia and its trading partner and the most recent 2008 financial crisis can be considered as dominant examples. Howbeit, this is the basic contradiction of the existing hegemonic economic structure from where the crisis begins. In this context, Minsky highlighted that stability itself creates instability. Additionally, instability increases uncertainty and that uncertainty causes economic crisis. Though crisis hits different economies (developed and underdeveloped) differently, but it has also some universal impacts like reduction in growth, increase in unemployment, stock market crash, reduction in trade volume and currency crisis etc.
Withal, when economic crisis begins this sharpens contradictions among the capitalists. Consequently, these contradictions are converted into rivalry and manifested in different shapes like price war etc. Furthermore, this scenario has much devastating effects where small, weak and newly established businesses cannot survive and the large businesses convert into monopolies and make strong cartels or syndicates for survival and cause more exploitation of both labor and consumers. Such process can also be analyzed through the different economic crunches; For instance, during the period of financial crisis of 2008 small business went under or were forced to lay off employees, slash spending, halt expansion plans and find new ways to survive which results in the closure of about 1.8 million small businesses during the period of December 2008 to December 2010. Moreover, every year 670,000 business were created before the decade of financial crisis and this figure reached at 715,000 in 2006. But during the period of financial crisis the number felt dramatically and reached 560,000, highlighted by Barbara Weltman in his report.
It is of great importance to understand that due to the weak and fragile foundations, current economic structure cannot resist against any shock, these shocks might demand, supply or financial shock. Demand shock which can be seen after the tragedy of 9/11, supply shock which was caused by rising in oil prices in 1973 and financial shock which created the financial crisis of 2008. Besides, such shocks have more disastrous effects during the period of uncertainty and instability and result in the deep economic recession.
However, same situation can be observed due to the emergence of COVID-19 pandemic. Covid-19 has come up with triple shocks demand, supply and financial shock simultaneously. Ironically, the fragile structure was already suffering from economic instability and shrinking the world economy. under the prevailing uncertainty the various international institutions and think tanks have already been reporting about the effects of uncertainty on the global economy. in the form of conflicts among great powers, trade wars etc. For instance, before the Covid-19, world was facing growth uncertainty and there was tendency of reduction in the global output. This uncertainty created conflict among different powers where the Sino-US trade war is one of the example of those conflicts. Further these conflicts negatively affected the world macro-economic indicators and shrank global growth and trade volume. As warned by IMF “US-China trade war will cut the global growth slowest pace since 2008-2009 financial crisis”. Additionally, in November 2019 financial times highlighted that “because of trade tensions global trade balance shrank 1.2 percent”.
However, this indicates that fragile hegemonic structure unable to tolerate triple economic shock (demand, supply and financial shock) caused by covid-19 and that might lead to recession. According to the world bank global economic prospect 2020“The global economy will shrink 5.2% this year. That would represent deepest recession since second world war with the largest fraction of economies experiencing declines in per capita output since 1870.”in addition it has also been warned in the same report that “Economic activity among advanced economies is anticipated to shrink 7% in 2020 as domestic demand and supply, trade, and finance have been severely disrupted. Emerging market and developing economies (EMDEs) are expected to shrink by 2.5% this year, their first contraction as a group in at least sixty years. Per capita incomes are expected to decline by 3.6%, which will tip millions of people into extreme poverty this year.”
Nonetheless, the existing hegemonic structure is not only fragile but also complex and standing on the foundation of exploitation of state and society at larger level. Therefore, any single factor cannot be considered as the main reason of the crisis. Rather multiple internal and external factors. However, the internal and hidden contradictions of global economic structure have been playing a significant role in global economic crunch. Additionally, these contradictions have made the recession destiny of the existing economic structure. Hence, whatever may be the situation, the recession is mandatory. This may start from any sector financial or real but it affects the whole economy and the external shocks fasten the process which can be observed during covid-19.
As Michel Robert explained while discussing the Marxist theory of crisis that “Crises of capitalist production are due ‘under consumption’, a lack of spending by workers who do not have enough to spend or due to ‘disproportion’, the anarchy of capitalist production means that production in various sectors can get out of line with others and production can just outstrip demand; or it’s the lack of profitability in an economic system that depends on profit being made for private owners in order for investment and production to take place.” Similarly, H.P Minsky argued in his financial instability hypothesis “financial crisis are endemic in capitalism because periods of economic prosperity encouraged borrower or lenders to be progressively reckless this excess optimism creates financial bubbles than busts”
It can be concluded that covid-19 has severely affected the complex socio-economic structure. Nevertheless, it is not the sole reason of current economic recession as it is being appeared in the contemporary data and literature produced by the world institutions and think tanks. These publications are neglecting the role of fragile structure and its foundations which are not in position to absorb any shock. Thus comprehending the genuine causes and factors influencing the crisis is necessary to develop appropriate mechanism to contain and address the various dynamics of the existing hegemonic structure.
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