CAT 1996 Question Paper

Now let us turn back to inquire whether sending our capital abroad, and consenting to be taxed to pay emigration fares to get rid of the women and men who are left without employment in consequence, is all that capitalism can do when our employers, who act for our capitalists in industrial affairs, and are more or less capitalists themselves in the earlier stages of capitalistic development, find that they can sell no more of their goods at a profit, or indeed at all, in their own country.

Clearly they cannot send abroad the capital they have already invested, because it has all been eaten up by the workers, leaving in its place factories and railways and mines and the like; and these cannot be packed into a ship's hold and sent to Africa It is only the freshly saved capital that can be sent out of the country. This, as we have seen, does go abroad in heaps of finished products. But the British land held by him on long lease, must, when once he has sold all the goods at home that his British customers can afford to buy, either shut up his works until the customers have worn out their stock of what they have bought, which would bankrupt him (for the landlord will not wait), or else sell his superfluous goods somewhere else; that is, he must send them abroad Now it is not easy to send them to civilized countries, because they practise Protection, which means that they impose heavy taxes (customs duties) on foreign goods. Uncivilized countries, without Protection, and inhabited by natives to whom gaudy calicoes and cheap showy brassware are dazzling and delightful novelties, are the best places to make for at first.

But trade requires a settled government to put down the habit of plundering strangers. This is not a habit of simple tribes, who are often friendly and honest. It is what civilized men do where there is no law to restrain them. Until quite recent times it was extremely dangerous to be wrecked on our own coasts, as wrecking, which meant plundering wrecked ships and refraining from any officious efforts to save the lives of their crews, was a well-established business in many places on our shores. The Chinese still remember some astonishing outbursts of looting perpetrated by English ladies of high position, at moments when law was suspended and priceless works of art were to be had for the grabbing. When trading with aborigines begins with the visit of a single ship, the cannons and cutlasses carried may be quite sufficient to overawe the natives if they are troublesome. The real difficulty begins when so many ships come that a little trading station of white men grows up and attracts the white ne'er-do-wells and violent roughs who are always being squeezed out of civilization by the pressure of law and order. It is these riff-raff who turn the place into a sort of hell in which sooner or later missionaries are murdered and traders plundered Their home governments are appealed to put a stop to this. A gunboat is sent out and inquiry made. The report after the inquiry is that there is nothing to be done but set up a civilized government, with a post office, police, troops and the navy in the offing. In short, the place is added to some civilized Empire. And the civilized taxpayer pays the bill without getting a farthing of the profits.

Of course the business does not stop there. The riff-raff who have created the emergency move out just beyond the boundary of the annexed territory, and are as great a nuisance as ever to the traders when they have exhausted the purchasing power of the included natives and push on after fresh customers. Again they call on their home government to civilize a further area; and so bit by bit the civilized Empire grows at the expense of the home taxpayers, without any intention or approval on their part, until at last although all their real patriotism is centred on their own people and confined to their own country, their own rulers, and their own religious faith; they find that the centre of their beloved realm has shifted to the other hemisphere. That is how we in the British Islands have found our centre moved from London to the Suez Canal, and are now in the position that out of every hundred of our fellow-subjects, in whose defence we are expected to shed the last drop of our blood, only 11 are whites or even Christians. In our bewilderment some of us declare that the Empire is a burden and a blunder, whilst others glory in it as a triumph. You and I need not argue with them just now, our point for the moment being that, whether blunder or glory, the British Empire was quite unintentional. What should have been undertaken only as a most carefully considered political development has been a series of commercial adventures thrust on us by capitalists forced by their own system to cater to foreign customers before their own country's needs were one-tenth satisfied.

That the doctrines connected with the name of Mr Darwin are altering our principles has become a sort of commonplace thing to say. And moral principles are said to share in this general transformation. Now, to pass by other subjects, I do not see why Darwinism need change our ultimate moral ideas. It will not modify our conception of the end, either for the community or the individual, unless we have been holding views which long before Darwin were out of date. As to the principles of ethics I perceive, in short, no sign of revolution. Darwinism has indeed helped many to a truer conception of the end, but I cannot admit that it has either originated or modified that conception.

And yet in ethics Darwinism after all perhaps be revolutionary. It may lead not to another view about the end, but to a different way of regarding the relative importance of the means. For in the ordinary moral creed those means seem estimated on no rational principle. Our creed appears rather to be an irrational mixture of jarring elements. We have the moral code of Christianity, accepted in part and in part rejected practically by all save a few fanatics. But we do not realise how in its very principle the Christian ideal is false. And when we reject this code for another and in part a sounder morality, we are in the same condition of blindness and of practical confusion. It is here that Darwinism, with all the tendencies we may group under that name, seems destined to intervene. It will make itself felt, I believe, more and more effectually. It may force on us in some points a correction of our moral views, and a return to a non-Christian and perhaps a Hellenic ideal. I propose to illustrate here these general statements by some remarks on Punishment.

Darwinism, I have said, has not even modified our ideas of the Chief Good. We may take that as — the welfare of the community realised in its members. There is, of course, a question as to the meaning to be given to welfare. We may identify that with mere pleasure, or again with mere system, or may rather view both as inseparable aspects of perfection and individuality. And the extent and nature of the community would once more be a subject for some discussion. But we are not forced to enter on these controversies here. We may leave welfare undefined, and for present purposes need not distinguish the community from the state. The welfare of this whole exists, of course, nowhere outside the individuals, and the individuals again have rights and duties only as members in the whole. This is the revived Hellenism — or we may call it the organic view of things — urged by German Idealism early in the present century.

Governments looking for easy popularity have frequently been tempted into announcing give-aways of all sorts; free electricity, virtually free water, subsidised food, cloth at half price, and so on. The subsidy culture has gone to extremes. The richest farmers in the country get subsidised fertiliser. University education, typically accessed by the wealtier sections, is charged at a fraction of cost. Postal services are subsidised, and so are railway services. Bus fares cannot be raised to economical levels because there will be violent protests, so bus travel is subsidised too. In the past, price control on a variety of items, from steel to cement, meant that industrial consumers of these items got them at less than actual cost, while the losses of the public sector companies that produced them were borne by the taxpayer! A study, done a few years ago, came to the conclusion that subsidies in the Indian economy total as much as 14.5 per cent of gross domestic product. At today's level, that would work out to about Rs. 1,50,000 crore.

And who pays the bill? The theory — and the political fiction on the basis of which it is sold to unsuspecting voters — is that subsidies go to the poor, and are paid for by the rich. The fact is that most subsidies go to the ‘rich’ (defined in the Indian context as those who are above the poverty line, and much of the tab goes indirectly to the poor. Because the hefty subsidy bill results in fiscal deficits, which in turn push up rates of inflation — which, as everyone knows, hits the poor the hardest of all. Indeed, that is why taxmen call inflation the most regressive form of taxation.

The entire subsidy system is built on the thesis that people cannot help themselves, therefore governments must do so. That people cannot afford to pay for a variety of goods and services, and therefore the government must step in. This thesis has been applied not just in the poor countries but in the rich ones as well; hence the birth of the welfare state in the West, and an almost Utopian social security system; free medical care, food aid, old age security, et al. But with the passage of time, most of the wealthy nations have discovered that their economies cannot sustain this social safety net, which infact reduces the desire among people to pay their own way, and takes away some of the incentive to work. In short, the bill was unaffordable, and their societies were simply not willing to pay. To the regret of many, but because of the laws of economics are harsh, most Western societies have been busy pruning the welfare bill.

In India, the lessons of this experience — over several decades, and in many countries — do not seem to have been learnt. Or, they are simply ignored in the pursuit of immediate votes. People who are promised cheap food or clothing do not in most cases look beyond the gift horses — to the question of who picks up the tab The uproar over higher petrol, diesel and cooking gas prices ignored this basic question: if the user of cooking gas does not want to pay for its cost, who should pay? Diesel in the country is subsidised, and if the trucker or owner of a diesel generator does not want to pay for its full cost, who does he or she think should pay the balance of the cost? It is a simple question, nevertheless it remains unasked.

The Deve Gowda government has shown some courage in biting the bullet when it comes to the price of petroleum products. But it has been bitten by a much bigger subsidy bug. It wants to offer food at half its cost to everyone below the poverty line, supposedly estimated at some 380 million people. What will be the cost? And, of course, who will pick up the tab? The Andhra Pradesh Government has been bankrupted by selling rice at Rs. 2 per kg. Should the Central Government be bankrupted too, before facing up to the question of what is affordable and what is not? Already, India is perenially short of power because the subsidy on electricity has bankrupted most electricity boards, and made private investment wary unless it gets all manner of state guarantees.

Delhi’s subsidised bus fares have bankrupted the Delhi Transport Corporation., whose buses have slowly disappeared from the capital's streets. It is easy to be soft and sentimental, by looking at programmes that will be popular. After all, who doesn't like a free lunch? But the evidence is surely mounting that the lunch isn't free at all. Somebody is paying the bill. And if you want to know who, take a look at the country's poor economic performance over the years.