Re-imagining our economic choices 

#GS3 #Economy 

For decades, human beings have chosen profits over lives. The time has come to jettison this approach 

  • Nations have made a crucial choice in recent weeks, choosing human life over economic growth. Governments including ours have mandated lockdowns to slow the pandemic, relieve the pressure on their hospitals and save lives. 
  • Updates land in our phones on a minute-by-minute basis, invoking both our empathy and our fear. Our choice is obvious — human life over economic growth. To choose otherwise would be inhuman. 
  • For decades, we have chosen profits and growth over human lives. The World Health Organization (WHO) estimates that 4.2 million lives are lost annually due to air pollution. These deaths occur in dispersed locations, through varying illnesses and outside our frenzied social media feeds. 
  • It is a choice between 4.2 million lives and the marginal returns from industries choosing polluting vs. non-polluting technologies. 
  • Cleaner technologies are available, and not only for Prius owners. For instance, through our IFAD programs, low-cost technologies are being developed even for smallholder farmers. 

Saving lives 

  • This is hardly viable for the 2% of the global population who are homeless or the 20% who lack adequate housing. Social distancing will also take a disproportionate economic toll on the informal sector, employing up to 60% of the working population globally and 90% in India. 
  • According to UNICEF, even prior to COVID-19, diseases directly linked to lack of safe water killed 1,400 children under five every day, globally over half a million a year.  
  • Economics is about choices, a study of ‘human behaviour as a relationship between ends and scarce means’. Trade-offs are central to these choices. 
  • On the one hand: 4.2 million, 0.5 million, 1,15,000 (and counting) lives. On the other: lower GDP rates, more expensive technologies, higher fiscal deficits. Such comparisons might not pass our usual aesthetic standards. 
  • The Confederation of Indian Industry is advising pay cuts for senior management while ensuring workers do not lose jobs. Liberal democracies are competing to curtail individual rights and movement. Citizens are supporting (even demanding) these restrictions. 

Changing the metrics 

  • It is time to shift from indices of economic growth and speed (such as rates of GDP growth) to those that build on lives and living conditions. 
  • The Human Development Index measures life expectancies as a proxy for long and healthy lives, education and national incomes per capita.  
  • The Multi-Dimensional Poverty Index builds on capabilities, captured through health, education and living standards.  
  • The difference between standard economic targets and these welfare-based indices is their clear focus on lives over profits. 
  • We inhabit a building with overlapping loops, where our rooms vary in size and comfort but are all linked.  
  • We face a common enemy, and there may be more in the future. One life undermined is a threat to everyone. 
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