I’m not an economist so I’m writing this just as a layperson.
I think there are 2 things our policymakers can do to sort out the economy, in fact 3 things:
- Make economic corruption one of the most heinous crimes
- Retrieve all the money that is earned by corrupt (by corrupt means)
- Make the rich pay more money in the form of taxes
A lot of India’s problems can be solved if corruption is taken care of because it eats into whatever development takes place. It is a big financial burden and the great disincentive for common people to engage in entrepreneurship and contribute towards the overall growth of the country. Simply starting a small business can be a nightmare, still, in many parts of the country.
Billions of rupees have been stashed away by the corrupt and this money can be productively used for the benefit of the country. I’m not aware of the exact figures, but many claim if India can retrieve the money that has been stolen from the country’s coffers India will not only repay its entire debt a lot of extra cash will be left for other work. So this must be done on a war footing because this cash is basically lying there and all it needs is a strong political will to get it back.
And now taxing the rich more — something to the tune of what Obama is trying to achieve. No, I am not against the rich but I think it is not going to put a personal strain on their affluence it for some years they have to pay more taxes. Let us say I have 50 crores stashed away in my bank – it is all white money. What harm does it do to me if I have to give say, 5 crores to the country? Of course it is my hard earned money but I’m not actually creating a better world for my children if the rest of my country remains poor and backward. I’m sure not every rich person in the country wants to eventually settle in Europe or America. So if they envisage themselves living in the country in their old age and their children prospering here, they should invest in the overall growth of the country.
Of the three suggestions I have made, the 3rd one rests upon the success of the first 2. As a rich person why should I part with my hard earned money when I’m sure that 95% of that money is going to go in the pockets of corrupt politicians and bureaucrats? So the third phenomena can only take place if the first two are implemented properly.
What do you think?