Taken from my old blog, dated November 23, 2012
Long time! I have never used this space to talk about society and economics, a subject that is close to my heart. Have spent many a long night discussing or thinking about the symptoms and remedies of this complex and intricate net of 7 billion disparate souls connected, it seems, by six degrees each. I was prompted to think about one particular situation by a discussion I had earlier, and nothing helps spur the thought process better than writing it down. So here goes.
The situation as it stands today, is that many first world capitalist countries have governmental policies that encourage their industries to outsource labour intensive jobs to populous third world countries. Almost everyone is publicly against this mode of operation. The people of developed nations have long decried losing lucrative jobs to cheap labour, whilst enjoying the fruits of cheap consumer goods. The social activists of third world countries, the only people who can be bothered to spend time on this and raise their voice are against this as ‘cheap’ labour usually translates into inhuman sweatshops harking back to the industrial age. It is especially horrible when you see underage kids yoked into driving this cart of 20th century progress. Is it really progress if the majority of the world population works its heart out for less than minimum wage? What can we do about it, if anything. Is it time for us to abandon the free market system? Abandon that turn of the century buzzword, Globalisation?
One reason for this dichotomy in standard of living is the dichotomy in governmental policy. Developed countries demand a certain standard of care and benefits for employees. Developing countries have no such qualms and will take any work they can get. In a way, this is history repeating itself. I mentioned the industrial age before. It set the stage for us to learn the ill effects of pure capitalism. What is happening today is something similar, only over a larger scale, worldwide.
So what is the root cause of this situation? Why are we repeating our mistakes? I believe that we dont really learn from others mistakes. We make them again, possibly on a different scale, and progress quite slowly. Human memory is not much longer than a generation. This is why trends cycle in 3-5 decades, as newer generations re-invent the wheel, again and again. What helps with having made the mistake before is that you tend to know what to do in times of crises. The first time this happened, it gave birth to hugely successful worker unions. They became, over time, too successful, strangling growth and losing direction themselves. The power see sawed, leading to an unsteady balance prevalent today in industrialized nations. What history taught us, lead to a shorter refractory period in the newly formed nations post world war. They did the same mistakes, tried to avoid them, overcompensated, went back the other way etc etc. We are at a stage when people are sacrificing much to the altar of industrial development. Some say way too much.
In my opinion, public policy should not directly tell anyone to do something. Like tell companies that that give your employees this this and this, mandatory. Or that you cannot outsource or something.
One thing you can do is tax unseemly practices. If labour is too cheap, tax it and make it not so cheap and unfeasible. But this doesn’t always work when companies are global conglomerates. All people are equally ingenious and it becomes a lawyers arms race of regulation and loophole exploitation.
In my opinion, the best way to tackle this is to tackle the social aspects of this problem. Why is there cheap labour in Asia? There is a huge untapped resource, population. Supply and demand skews the wages to a ridiculously low amount. Apart from governmental regulation to fix wages to a decent amount, what we can do is educate and empower everyone. Yes, thats my one thing fixes all answer. Education.
Whenever I pull out education, people give me facts to the contrary. Look at all these educated people who are still stupid. Education can teach you but it is up to you to learn and so on and so on. Yes, I agree that a man who can read write and do math is not necessarily more intelligent then someone who cannot. I agree that a woman with a degree can be colossally stupid. Education is no guarantee to rationality. However, I doubt that anyone would agree that being learned enhances your chances of thinking for yourself and knowing your options. First world nations face similar problems with their poor people, who spiral in a cycle of debt and drug addiction. They do not know that there are people and organisations out there to help them out of this. They do not know anything outside of their circle of violence and addiction. Ditto for uneducated people. They do not know that there are options to that money-lender. They do not know that they can go to a higher authority, tall them about the sweatshops and with some effort, shut it down. Yes, it is possible.
People who are stupid are stupid, and people with wit will always have that. Education merely opens the door to possibilities that are there for you to exploit. This is one thing governments can do. It is exceedingly sad to see developing nations in Asia and elsewhere not spending enough on education. It seems obvious to me that if your most valuable natural resource is Human, with such a large untapped demographic advantage, that should be the focus of whatever you do.
I recently heard that the job of a high school teacher is the most highly sought after job in China. One of the reasons is that it is very highly paid. Everywhere else primary and secondary teachers are underpaid. When I went to an interview for a teaching position at KV, in Pune, I got the shock of my life. This was one of the premier school systems in India. There were about 30 odd positions to be filled. More than 500 people had come for the interview on the final day. As far as I could see, I was the only, the ONLY person with a masters degree. If we cannot attract more qualified people to schools, to teach, what are we teaching? I had taught in KV for 2 months before the interview. I was so ridiculously overqualified for the job of teaching Science to 13-17 year old students that I was selected for all the positions I had applied to. On the basis of a 2 minute interview. I am not bragging here. Just want to illustrate the dearth of good qualified teachers. Surely, I thought, there are tons of experienced teachers out there. Not apparent from what I saw.
Why dont we have courses that teach how to teach? We have all seen how people who know a lot arent necessarily good teachers, and sometimes those who may not everything may be the best teachers. Why dont we have a system to nurture this talent? Surely a teacher’s job is equally [if not more] important that a doctor engineer or scientist! Why not incentivise it?
Look at the situation in India. School fees are spiraling. I wont even go to the current fads and trends in school teaching today. It is so horrendously difficult to get a kid admitted to a decent school. How do you suppose an average child from a poor country like ours is supposed to get educated? If s/he is not, surely you are condemning him/her to a life time of low wage unskilled labour. There lies the crux. Increase the amount of skilled personnel and you will get a better life style, a better economy. No one opposes the software sweatshops where people work 18 hour days and develop software solutions for companies in the US. No one except the Americans. This is because this is skilled labour, that you are paid a lot to do.
This may seem too simplistic, but a rock solid education system will start a cycle that will slowly but surely tackle all the problems we have. More educated people, more progressive the economy and manufacturing base. More the manufacturing and infrastructure base, more job creation. More job creation, better the economy, better the standard of living. Better the economy, more resources diverted to education.
We need to somehow make education and science and know-how cool again. Too many folk tales warn against the narrow minded hubris of the learned man versus the simple wit of a salt-of-the-earth fellow. It is true, a valuable lesson, however not the full story. Education may not give you wisdom, however it surely gives you the tools to do so. Makes it a lot easier. Makes it more likely that you better yourself in life.
I know this is a very slow process. People need to be aware of it, it needs to percolate through, public policy needs to change. Even after this, it will take a whole generation or two for the good cycle to emerge. However, once this wheel starts rolling, there is no stopping it.
All inequality stems from the inequality of means. If everyone is guaranteed an empowered chidlhood, we can eliminate one of the inequalities and go forward.