> GDP is useful to point out the scale of money in the economy, and the > tiny amount that NREGA/S is adding to the pool.
It adds much more than that as the money rotates through the system. That's not the point, the reason it's a big cost is that it's a big part of govt spend, that's all. > # Mukesh Ambani with a known personal wealth of $22.6 Billion could > run the NREGA for 3-4 years on savings > - i.e. he has 2-3 times more money than 42 million Indian households > put together earn in a year. I'm not sure how this matters, but more power to him, and more power to make people earn more money and pay taxes. We need more billionaires not less. > Even if one believes that merely adding $5 Billion to the rural > economy can cause a 13% jump in food inflation, which I don't then it > is a scathing criticism of the income inequalities in India - the > money is going directly towards food - these are people who are > otherwise starving. I think we'll find it's the other way - people continue to starve, teh marginal guy gets some extra money which he ends up paying extra for food so he hardly benefits. Either ways it's not the $8 billion (not $5B) that causes food inflation, it's how it's done. > These 42 million households are not at all like the gentlemen of > Aurangabad (and it was gentlemen, not a single woman was present), who > ordered 148 Mercedes Benz automobiles together at a reduced 7% > (instead of the usual 14% for tractors) interest rate courtesy SBI. Not to say this is a good thing of course, but I'm not sure why this is considered less bad than NREGA? I'd argue against both. I haev no problem with someone ordering 148 benz cars, but the lower rate of interest is necessarily bad if there was corruption involved. > I don't see any mention in the constitution of a duty to create more > Billionaires, or luxury car owners. There is no such "duty" - like there is no duty in the constitution to provide air for you to breathe. But it happens. > If there aren't enough laborers in the villages during harvest season > that is truly good, NREGA is pushing up the local wages, and helping > the poor to fight established brokers and middle men who keep wages > low and exploitative. In the context of inflation it's bad. It may be a better in the short term, but we create a bad bad long term hazard. You increase wages through proper competition, like Ford who paid his labourers more and got his productivity. The short term impact of NREGA is higher local wages, but teh important part is: higher local wages because the competition is, largely, earning money for no work. The very rich do that, now the very poor do it, and us middle class fellows get shafted for it. > How many of the Aurangabad brigade will pay back their subsidized > loans do you think? These are politically connected crooks who will > likely walk out of the loan the same way they got the half price loans > in the first place. > > Our banking system needs to be fixed. The problem isn't NREGA. NREGA needs quite as much to go as our banking system needs fixing. Both have become necessary evils politically now. Though if you asked me I would privatize all public sector banks and cut off government lifelines first. > I don't have a problem with improving NREGA to make it more > accountable, manageable and all that. It is important to give it a > chance to succeed. The two things I will give NREGA full credit for is that it is a cash transfer, and that the level of accountability and transparency in a project this large is fabulous. We need more enforcement and cross-checks, too. But I don't agree with the premise of paying people to do next to nothing, or of "employment" as a direct goal (employment needs to be the result of something, not the something) >> Some of the aspects I've mentioned have generalizations because that's >> what it is - the long term effect of NREGA can only be known in the >> long term, and no amount of "data" will satisfy an observer. > > Again, I point to Article 47 - India has a duty to do this. Disagree that Article 47 says NREGA is the duty; of course NREGA is constitutionally ok, but the duty lies in creating sustainable long term solutions, and NREGA is not either. I would much rather see the land reform, the power and road connectivity, the ability for those that NREGA supposedly benefits to actually become entrepreneurs, and create employment as a side effect of their growth rather than anything else.
