“A linen
shirt … is, strictly speaking, not a necessary of life. The Greeks and Romans lived, I suppose,
very comfortably though they had no linen. But in the present times, through
the greater part of Europe, a creditable day-labourer would be ashamed to
appear in public without a linen shirt, the want of which would be supposed to
denote that disgraceful degree of poverty which, it is presumed, nobody can
well fall into without extreme bad conduct.” [1]
Dr. Montek Singh Ahluwalia has had enough
of Rs. 32/- per day [2]. Defining poverty at “Rs. 4824 per month for a family [of
five] to define poverty is not comfortable but is not all that ridiculous in
Indian conditions,” he is quoted as saying. Note the choice of word – comfortable. To me it sounded like, “Turn
down the air conditioner to -40o C [which also happens to be -40o
F]; it is not comfortable but we will not die.”
I wonder how that Rs. 4,824 came about. Was
it worked out from a day (Rs. 32.16) to a nominal month of 30 days, or the other
way about, from the month down to about
Rs. 32/- day? Whichever way it was, he was not willing to give up Rs. 24/- per
month for a family of five (Rs. 0.16 per day per individual; this, when the
minimum legal tender is Rs. 0.50).
I wonder what could that Rs. 24/- have
bought. A linen shirt perhaps?
The extended quote at the beginning of this
post is taken from the classic Inquiry
into the Nature and Causes of Wealth of Nations by Adam Smith, the supposed
guru of the free marketers, as quoted in a World Bank blog post by Martin
Ravallion. Of course, Dr. Ahluwalia having served time at the high security IMF
(it must have felt like a prison as he could not have been allowed to think
independently, serving as it does fleet footed global finance), would have forgotten
he did time at the World Bank also, and hence has ignored this post. Let me
point out a few things, for his benefit and in his defense.
In the post, one reads, “…certain
socially-specific expenditures are essential for social inclusion, on top of
basic needs for nutrition and physical survival.” So, this Rs. 24/- would be
spent towards the social inclusion of that family of five. You must understand
that the 12th Plan Approach Paper pointedly makes the claim of working
towards inclusive development.
What sort of occasions of social inclusion would the
poor family look forward to? Festivals, celebrations, communal feasts etc.
These socially-specific expenditures “have an important social role in
maintaining the networks that are crucial to coping with poverty and even
escaping it.”
Poverty has to be measured in two distinct
aspects: physical survival, and social inclusion. You can get the primer on
this from the link I have given. But suffice it for me to say that Dr.
Ahluwalia has gone beyond mere physical survival of the poor and has addressed
the second feature of poverty, social exclusion. The effort at inclusion comes
at Rs. 24/- for a family of five, enough to buy a single linen shirt in a
month. In five months the whole family will be included.
So, stop pillorying him. He is doing the
best he can. He said, “…the poverty line is not a comfort line of acceptable
living for the aam aadmi. It is a
poverty line which by definition implies considerable stress.”
I am sure he added the following, which was
not mentioned in the newspaper report (for lack of space): “The stress I
mentioned does not include going bare chested on the streets. One can buy a
linen shirt. I am an acolyte of Adam Smith, after all.”
Raghuram Ekambaram
References
2. Rs. 32 a day poverty
line not all that “ridiculous”: Montek; The Hindu, October 12, 2011
8 comments:
The poor in India should be immensely grateful to Dr Ahluwalia for such generosity :)
Thanks for accepting the tone and the substance of the post Matheikal!
Raghuram Ekambaram
I am reminded of a dialouge from the Hindi Villain Ajit `Put him in liquid gas, Gas wont allow him to live and Liquid wont allow him to die' :p. That is what seems to be crux of the DCPC statement. Beyond this the limitations of my thinking does not allow me to imagine life at Rs.32/- per day.
True, the way DCPC shows sympathy towards the poor, they can neither exist nor non-exist, Balu. The point is, if the definition is not towards who is to receive state benefits, what is it for at all? If it for tracing the trend, the limit can be as much Rs. 9,999/- month per person!
Thanks.
Raghuram Ekambaram
"if you want to be happy"
Duryodana was told by Bhishma
"go and get the shirt of the happiest man and wear it .You will be happy for ever."
When he came back empty handed Bhishma enquired whether he found the happiest man.
Duryodhana replied in the affirmative..so Bhisma asked him
"where is his shirt?" .
Duryodana replied
"he did not have any"
this is just about the linen part of your blog..
I know that DCPC is elitist in his views, Raghu.But I also know that what I say next will invite scorn, but I would still say that it is incorrect to use a per capita per day figure in isolation and dissect it in the manner media and others have done.
A poor person is not considered poor in isolation, she is poor only if she shares food and roof with a family that is poor.If you start considering an individual as poor strictly according to her own wealth/ earning (tangible Rs 32 or less?), our homemaker women might all be counted as poor individuals, on par with our children who are still students.The point that I am trying to make is that per day per head income/expenditure is not what is relevant, it is per family per month sharing common facilitiesthat is crucial in the exercise of defining poverty line.
If a family of 5 or 6 has a single earning member of just under Rs 5000 in an urban area (mind you it is an all India average,wages/income in metro cities could of course vary upwards), the family is undoubtedly poor, living a stressful life.Is this figure so implausible to imagine? We are talking 'absolute' poverty here, not 'relative' poverty vis a vis the perception of the middle and the higher class.
For anecdotal value, if nothing else, a part-time working domestic servant working in many homes in Delhi earns around 5-6 thousand per month, and is still able to feed and send her children to school(schooling is free, with mid-day meal), and not making them work. Incidentally the current minimum wage (i.e for working 8 hours) for unskilled labour in Delhi is 6422/-
If you are interested, I will mail you a soft copy of late Suresh Tendulkar's report on methodology of estimating poverty, which is the basis of poverty line at present.
Aditi,
I do not heap scorn on anyone who visits my space, and definitekly not you. I treat you with repect because even when we disagree your statements, position, ideas jiggle my brain cells. I think highly of you implicitly almost always, and explicitly more than a few times.
You said, "per day per head income/expenditure is not what is relevant, it is per family per month sharing common facilitiesthat is crucial in the exercise of defining poverty line."
Yes, this is how DCPC himself said it "Rs. 4,824/- per month for a family [of five]". It is just that my criticism of his position is implicit.
As it is he admits that poverty is a stressul condition. But, he cannot admit, perhaps even to himself, that the nation may want to think of going beyond ensuring "physical survival" for the poor. The Rs. 24/- premium is mentioned only for the effect of exagerration. I have, over many years, very strongly endorsed the "LInen shirt" idea of Adam Smith.
DCPC is more into the philosophy of the poor "boot strapping" themselves out of poverty. I am dead set against it. I am also against the tide lifting up all the boats analogy. My sympathies lie with the analogy of canal locks lifting boats.
I am not taking Rs. 32./- in a dismembered context. I take it in the spirit that you had once espoused in a your blog - about the increase in the price of petrol. You said that in the whole basket of consumption for those owning a car, the fuel price increase is not going to pinch too tightly. And I endorsed it very strongly.
It is absolutely correct that one has to look at Rs. 4,824/- + the other amenities that the exchequer is providing the poor. But, there is a catch. With the provisioning of infrastructure shifting towards market involvement, no one knows how long even the current dysfunctional system of public provisions will continue. Therefore, the poor have to be given a chance to build up their social capital. It is in this respect, and in my judgement, I find fault with the metric of Rs. 4.824/- per month for reckoning poverty.
And, you would agree that DCPC was forced to go back on the connection made between the poverty line and BPL card.That was a through and through fiscal sleight of hand. In this case, I do not even know why to have a poverty assessment.
Once again, thanks for the detailed criticism.
Raghuram Ekambaram
Thanks a lot for that wonderful response, DS sir.
Raghuram Ekambaram
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