Chapter 1: Artificial and Natural Economics 

These summers I went to my friend’s (Akshita’s) house in Mumbai. This was my first visit to her house. She lives with her family in a company provided house to her father. The house is quite large, with a well maintained garden outside. Jasmine, Rose and other colorful plants dot its edges. A sweet fragrance permeates its entire atmosphere. Uncle (Mr. Aggarwal) asked me to take off my shoes, wash my hands and feet with the garden hose, and then enter their drawing room. 

The simplicity of the set-up of the room surprised me. There were paintings depicting village scene, sweet devotional music was coming from somewhere and everything else was in harmony with nature. 

Me: Doesn’t quite look like you have returned from States.

Mr. Aggarwal: Why? Did you expect me to grow two horns, with the letters U and S inscribed on them?

Me: Yes and more! Wrangler jeans, heavy metal rock, Michael Jackson… 

(Just then his elder daughter enters with 2 glasses of water. She is looking beautiful as my friend - Akshita. In spite of my typical bad college character, I couldn’t resist myself from standing in respect) 

Me: (After she left) You are very simple. I am amazed at simplicity of your home. Yet, it is hard not to notice its elegance and beauty. The paintings, the garden filled with flowers and almost complete absence of furniture is strikingly uncommon. 

Mr. Aggarwal: This is living in natural opulence unlike so-called “modern” times. Actually, our whole economy is artificial in practically every aspect. Even a casual look around ourselves will reveal the truth of this statement. I am sure you can think of many items that we use that are completely unnatural and unnecessary. 

Me: Sure! All kinds of electronics items, motorized vehicles, and foam mattresses are definite luxuries, I can think of a host of other items too! 

Mr. Aggarwal: In fact, our whole life is based on artificial values. Our whole economy is based on an artificial purpose of our very lives. 

Me: How so? I am not quite sure I understand… I mean we can understand using natural products like leaf plates instead of plastic and so on. 

Mr. Aggarwal: That is of course artificial. These days every Tom, Dick and Harry is screaming about it. However, I am thinking fundamentally different. Consider a fish out of water. Would he be happy if you were to feed him first class sweets? Or a beautiful she-fish? 

Me: Of course, the fish won’t be happy. He is not in his natural environment. So how can he be happy with any of these things? 

Mr. Aggarwal: Indeed! Our attempts at economic development are somewhat similar. Thus, it is not simply a matter of using natural products versus artificial ones. It is merely a matter of recognizing our natural position. 

Me: And if our natural position is identified, then our economic development will also be natural, is it? What is the natural position? 

Mr. Aggarwal: Our natural position is in living in harmony with nature. Nature has enough for everyone’s need but not for anyone’s greed. However, it is due to our rebellious nature that we are suffering economically. 

Me: So, is it somewhat like the law-breakers of a state are being put into a prison? 

Mr. Aggarwal: Yes! It is not that the state wants everyone to be locked up in a prison. But as soon as a city is built, the state also makes room for the expected criminals. This is just like a rich man’s son. If he leaves his father, then he is the loser and not the father. The father does not want the son to suffer, but the son is bent upon it. To stop his suffering, son must turn his attention back to his father. Similarly, for natural economic growth, we have to adopt natural ways. 

Me: So your conception is that our economy is artificial because it is based on an artificial conception of our reality? 

Mr. Aggarwal: Yes! If there is enough grains, enough fruits, enough milk, enough cotton, enough jewels, and enough water, why then people need cinemas, houses of prostitution and slaughterhouses? 

Me: The search for a life of artificial luxuries has produced nothing but quarrel between man and man, and nation and nation. Thousands of men are being sent to the hellish factories and to the war fields at the whims of a few men… 

Mr. Aggarwal: The pursuit of such an artificial economy has led us away from our very reality. Because people at large are bind to the needs of self-realization, they have become so sinful so as to kill innocent animals in slaughterhouses in the name of civilization. 

(Just then Akshita arrives from her class and we went out for a walk and returned at dinner. After dinner, Mr. Aggarwal took me to a garden nearby. Just at the back of house was a cowshed) 

Me: Uncle, I am fascinated by your tastes. 

Mr. Aggarwal: Quite different from the usual concept of good life, isn’t it? These days’ people keep cats and dogs as pets. Even my parents lived a life of simplicity. My grandfather had a mango orchard. We would go and eat mangoes to our heart’s content. He also had 16 cows. Each cow would give more than 10 liters of milk daily! He had fresh dairy business. At my grandfather’s time, main emphasis was on cows, oxen, and land. Any man could maintain himself with a little land, cows and ox. In fact, even small farmers could easily protect cows and provide ample grazing pastures. 

It is an amazing fact that the cows eat dry grass and produces the most miraculous of foods: milk. It is impossible to invent a machine to do this, even perfectly knowing the chemical composition of milk. Our “modern” civilization is so harsh that we cannot provide even dry grass for her. 

(We reached back at his home, where I stayed with Akshita for 40 minutes and then left. My. Aggarwal invited me to a presentation on Alternate Energy Resources in his company the next day.) 

Chapter 2: First ‘Twas Gold, Then Silver, Copper and Now… Paper! 

(Mr. Aggarwal had finished his presentation and I was beaming at him for his incisive presentation. Seminar attendees were acknowledging him with a hand shake and a nod.) 

Me: I loved your cartoon of the man going with a cartload of a paper to buy tomatoes. 

Mr. Aggarwal: It might actually come true. I remember when I was young; I used to buy vegetables for our whole family for just three rupees a day. My father used to pay just 20 paise for that when he was young. Just imagine getting a whole bag of vegetables for so little. 

Me: How unfortunate that we have lost the golden days! And we call this advancement. But what makes the prices soar like that? 

Mr. Aggarwal: The economists will tell us the answer to that – inflation! Give some terminology to some phenomenon and propagate that as the cause of that phenomenon. If we are advancing, why should things like grains, milk, vegetables and fruits should become expensive day by day? They are naturally available… 

Me: They claim that production has gone up because of technological advancement, fertilizers and pesticides. 

Mr. Aggarwal: And still prices are soaring; just see how they hoodwink everyone. Actually, the same vegetables are being sold. Why should one pay 50 times more than 15 years ago? That means people have to work so much harder.  

Me: The trouble is, no one asks this question. They take it for granted that inflation is the natural way of things. And the big shots of the society convince themselves and everyone else that it is all due to population explosion. People wrongly use population as a convenient scapegoat. 

Mr. Aggarwal: That is a useless argument. If that is the case, why are the prices of foodstuffs increasing in countries like Australia and America where population is stagnant or going down. 

Akshita: Actually, I think we have blindly accepted these arguments without deeply evaluating them. 

Mr. Aggarwal: The real fact is that the capitalists and administrators have mis-led the society in a wholesale fashion. In their greedy pursuit for making money, they have devised a whole system of economic instability, so they will always be in a controlling position. The hapless intellectual has bitten into their bait and got trapped in this condition. Because of our failure to give true education to people, the people at large have become fooled into accepting this unnatural course of things. 

Me: Yes, today we are so unfortunate that if the petrol prices go up because of international politics, there is an increase in prices of rice and wheat. If we were de-linked from the world, by means of natural sustainable economy, then we would have no worries of what happened in Japan or Indonesia. 

Akshita: I would like to object there. That’s because in today’s world we cannot afford to de-link ourselves from the rest of the world. Then who would respect us in the world? 

Mr. Aggarwal: This is exactly strategy of the administrators and capitalists. They wan to make everyone feel as if they are dependent on them. This fearful dependence comes from lack of true knowledge. 

Akshita: How do you propose that we should live respectably in this world just the way you say so?  

Me: Just from history we can learn so much. India was such an opulent country. People used to keep gold ornaments and silver paraphernalia for the worship of Lord in the temple. Even at home, they would keep many cows. And each couple used to have at least 5 sons and 3 daughters and there was no birth-control alarm at that time. And they did not depend on this gigantic economic-political structure for their needs. Essential things were produced locally and people happily lived like that for thousands of years. Today we can eat from paper and plastic. Nowadays, even packaged foods are transported over large distances in the name of advancement. 

Mr. Aggarwal: Since the whole population is trained to think of increasing sense gratification as the goal of life, everyone wants to buy television, car, and other commodities, without actual need. A capitalist makes some item of sense gratification and opens his industry somewhere in Timbuktu. And widely advertises his product through all media. He uses middlemen to transport his products. This again adds to the cost of product. 

Me: Every year, the employees are given paid vacations, raises in salaries, expensive vehicles and so forth. The capitalists and administrators naturally charge all of these costs to the public. 

Akshita: But what’s the harm in giving raises to employees who have worked hard for the company. It is just a reward of them. With the increasing prices all around, is it not necessary to give these benefits to the local employees to keep them happy? 

Mr. Aggarwal: You are actually making 2 distinct points – (1) That the employees should be rewarded; (2) We need to keep revising the salary scales to meet the escalating prices. 

Akshita: As a manager of a big company, one has to see to the interest of the employees working under him.  

Me: Sure! But by increasing wages, how do you keep their interest in mind? Moreover, wouldn’t you say there is also some fear in our hearts that the employee might leave us and join some competitor’s company? 

Akshita: Well, sure, I am concerned about my own position. After all, I’ve taken so much trouble to train him… And, besides increasing wages, in what other ways can I show my concern and care for my employee? 

Mr. Aggarwal: Well, this is exactly the strategy of the capitalist. He purchases the worker and indoctrinates in him a value system based on money, position etc. This value system is unlikely to produce a good result. And also, the argument that we have to increase wages to counter escalating prices is simply circular logic. Which comes first, higher prices or higher wages? The pay-hike-price-hike syndrome will never come to an end this way. 

Akshita: This is true. I can see how this capitalistic ideology has led to runaway inflation in many countries. But what concerns me is that communist countries have done far worse. Look at the plight of some of the erstwhile USSR states. Even so-called welfare states like Sweden are in dire trouble. 

Mr. Aggarwal: The general misconception is that the alternative to modern capitalism is communism or some concocted substitute. In all these systems, one man is exploiting another man. No man can come up with a perfect system with imperfect senses. The communists are collectively thinking that they are proprietors. Communists also compete for the post of dictator. Everyone is trying to exploit everyone else in this world.  

These soaring prices will wipe most poor people out. Since we have inextricably made even agriculture and dairy subservient to technology, any small change in the world stock market hits even street sweepers.  

Me: Inflation primarily occurs because of greed. Motivated by profit, people are hired to produce some item of sense gratification. In order to retain trained up employees, salary hikes are given.  But how does the extra money come? It comes from extra pricing of goods. This now spreads to everyone. The doctors, farmers, engineers, lawyers, farmers, the vegetable vendors, the cowherds – all of them join the bandwagon. They all have to pay the extra prices for their goods. Since everyone has been convinced that we cannot live without artificial needs, all of these productive people also increase prices of their respective goods. Because of this, many farmers now grow cash crops for exports. There is also hoarding and excessive use of fertilizers and pesticides, which degrade the soil quickly. These artificial products in turn hike up the costs. It’s vicious. It’s a total runaway situation. Why can’t people see all of this? 

In an agrarian society, spearheaded by small farms owned by compassionate farmers, this phenomenon will be completely stopped. 

Akshita: Brilliant! It seems dad has trained you very well. So, everyone is cheating somewhere. Otherwise, why should a kilo of potatoes cost 50 times what it cost 20 years ago? I wonder where they get all this extra money! 

Mr. Aggarwal: Well, there is no money. It is just money bills. Just paper, a promissory note. It is not as if it is some real good. Nowadays, they don’t even have coins. Previously, they used actual gold, silver and copper coins. 

Akshita: But that’s only for convenience in carrying. Imagine carrying a bunch of coins… 

Me: Convenient not only for carrying, but also for printing as many as you want. It’s just a matter of chopping some thousands of helpless trees and printing on paper. The government can give any number of such promissory notes. Surely, it’s convenient. 

Mr. Aggarwal: Even accepting that it was for the purpose of convenience, previously there was the idea of gold standard currency. A government could only print the equivalent of the reserve gold. Later, they abolished that also. Now you can print as much as you like. Just ink on paper. So for working hard, you are given only a promissory note. What is the value of Rs. 100 or $100 note? 

Me: Nothing! A time will come when you will be paying in kilograms of promissory notes in exchange for a kilogram of rice or wheat. Nowadays, it is worse. It is plastic money, credits cards of course. In fact, a back account is merely a number in a computer. And we are fooled into believing that it is something. 

Akshita: But people are still able to purchase things with these promissory notes and credit cards. How do you explain that? 

Mr. Aggarwal: Well, let us not be fooled by that. The promissory note is only valid until the government is viable. What will happen to us if the government fails? We know from history how during the world war the German government completely failed. No one would accept the Deutsche Mark in any shops. And there were stories of how people were throwing the promissory notes on the streets because they had no value. 

Akshita: So where lays the real wealth? 

Mr. Aggarwal: The real wealth is in agricultural fields, cows and bulls. An intelligent society will maintain and protect its cows and ox very carefully. Cows mean milk, butter, ghee, yogurt, cheese and so many other wonderful things. Cows and bulls also give plenty of manure, which is an excellent fertilizer. 

Me: How did they purchase their essentials? 

Mr. Aggarwal: Well, simple system of bartering. People exchanged essential commodities. There was not this gigantic network of financial and commercial institutions out to make quick money. 

Akshita: They had no promissory notes, of course! 

Mr. Aggarwal: They wouldn’t kill a tree for such an inauspicious and poor purpose. Promissory notes encourage corruption and cheating at all levels. Moreover, they bring in a false sense of security to the people and government. It encourages bad money to grow. Bad money drives out good money. And everyone suffers. There should be actual goods, not just promissory notes. We should return to gold coins or even silver coins. All forms of paper money should be abolished. 

Then the capitalists and economists wouldn’t be able to exploit people by artificial pay hikes. Without abolishing paper money, there is no question of arresting inflation and its attendant problems. 

(It was time for Akshita to leave for her class and for me to go for my work. We both said goodbye to Uncle and came out of his company’s seminar hall. And with these thoughts in my mind, I left for my work to meet them on next weekend!) 

Disclaimer: These thoughts are expressed by a novice in economics. These may contain many technical errors. Please report them on mitanshu.garg@gmail.com. This is for the information of people and you are most welcome to share it with as many people as you want.