Wednesday, 12 July 2017

As I Please: Function and Reward

Function and Reward

While I don’t agree with everything Orwell says, I have always been struck by his tale of travelling on a liner to Burma. He tells the story so:

”One day, for some reason, I came up from lunch early. The deck was empty except for the fair-haired quartermaster, who was scurrying like a rat long the side of the deck-houses, with something partially concealed between his monstrous hands. I had just time to see what it was before he shot past me and vanished into a doorway. It was a pie dish containing a half-eaten baked custard pudding.”

“At once glance I took in the situation—indeed, the man’s air of guilt made it unmistakable. The pudding was a left-over from one of the passengers’ tables. It had been illicitly given to him by a steward, and he was carrying it off to the seamen’s quarters to devour it at leisure. “

“Across more than twenty years I can still faintly feel the shock of astonishment that I felt at that moment. It took me some time to see the incident in all its bearings: but do I seem to exaggerate when I say that this sudden revelation of the gap between function and reward—the revelation that a highly-skilled craftsman, who might literally hold all our lives in his hands, was glad to steal scraps of food from our table—taught me more than I could have learned from half a dozen Socialist pamphlets?”

It always amazes me that the way professions are valued often seems topsy-turvey.

As we have seen in the recent election in the UK, nurses pay is poor, and some even have to resort to food banks, and yet bankers who engage in “casino banking” make hundreds of thousands in bonuses.

Ann Lee notes that:

"It does not make sense that most artists, teachers, and doctors - those who deliver the greatest value to society - are the least paid individuals, while investment bankers and speculators who earn the most amount of money are adding minimal value to society at best, and at worst, destroying value."

The Wire has an article by Devinder Sharma this year which looks at the contrast between rich corporations and poor farmers in India. The place is India, but the place could be everywhere.

“The Gujarat government gave a loan of Rs 558.58 crore to the Tatas to set up the Nano plant at Sanand, near Ahmedabad. The Gujarat government has acknowledged that the massive loan was given at an interest of 0.1%, to be paid back in 20 years. In other words, this huge loan was virtually an interest free long term loan. In another case, Steel tycoon, Laxmi Narain Mittal, was given Rs 1,200 crore by the Punjab government to invest in the Bathinda refinery. He also got the loan at a 0.1% rate of interest.”

“On the other hand, if an extremely poor woman in a village wants to buy a goat worth Rs 5,000, she goes to a micro-finance institute (MFI), which provides her a loan at an interest rate of 24% to 36% or even more. This paltry loan has to be returned at weekly intervals. This poor woman is also an entrepreneur and wants to sustain her livelihood rearing a goat, the milk of which she can sell. Millions of livelihoods can potentially be sustained if banks were to provide loans like the ones the Tatas and Mittal received, for poor entrepreneurs.”

And concludes:

“What needs to be seriously considered is that a terrible agrarian crisis is being allowed to prevail, primarily because of systemic efforts to keep farmers impoverished. By denying farmers the right price for their produce, the credit policy too is designed wrongly so that it benefits the rich at the cost of farmers and the rural poor. But will the banks accept their fault and redesign the credit policies? The rich corporates will continue to get tax incentives and massive subsidies in the name of incentives for growth.”

But without farmers, how would the CEOs of the rich corporations survive?

What we really need is what E.F. Schumacher called "Economics as if People Mattered".

1 comment:

Mark Forskitt said...

Thanks Tony. I hadnt come across Mr Blair's liner anecdote before. And indeed where would we be without the farmers.