Atanu Dey On India's Development

The Poor as a Fertile Source of Slave Labor

I have never been able to shake off the conviction that there must be a very good economic reason for why there are so many poor people around the world. You may say that I am crazy to connect what apparently are totally distinct facts about the world but bear with me for a bit while I lay out my argument.

I argue that the large pool of poor people serve as a reservoir of extremely cheap labor which helps the rich. The rich have control and are powerful. They could choose to bring about the end of poverty. But they don’t because absent grinding poverty, the cheap labor will dry up and lead to less favorable outcomes for the rich and powerful. I hasten to add that the rich and the powerful cannot be distinguished by the color of their skin, racial origin, or nationality. The rich and the powerful exist in rich and poor countries alike. Their interests are aligned irrespective of which part of the world they live in.

Thus the rich in India would advocate policies that will ensure that the reservoir of poor Indians never run dry. Empirical evidence is plenty. There were only about 150 million abjectly poor people in India around 1950. Today, about 50 years later, India has about 300 million abjectly poor people. Mind you, this is after implementing every conceivable form of “pro-poor” policies. Not a single policy maker would ever claim that their policies were anti-poor. They all are for the benefit of the poor. And yet, the numbers of the poor continually increase. I claim that the policies are “more-poor” rather than “pro-poor”.

One such policy now making the rounds is the so-called “Employment Guarantee Scheme” which I mentioned here last time. In my considered opinion, this would raise the level of poverty in India and increase the number of poor. How this will come about, I will address later. For now, I will move to the utility of the poor. They are good for slave labor.

Slavery is an ancient institution. Mention slavery and you conjure up images of Africa. In the past, Africa paid the price and the benefits went to Europeans, both in the Old World as well as the New World. The rich and powerful, both in Africa and in Europe (and their American colonies), gained immensely. Let’s not forget that African slavery was not an entirely European-driven phenomenon. Africans were involved in it as much as anyone else. Africans managed the supply-side while Europeans the demand-side.

For guns and other European manufactures, powerful Africans would conduct raiding parties with guns and cavalry. Here is a heart-breaking account by James Richardson writing about it around 1850:

A cry was raised early this morning: “The Sarkee is coming!” … It turned out that a string of captives, fruits of the razzia, was coming in. There cannot be in the world … a more appalling spectacle than this. My head swam as I gazed. A single horseman rode first … and the wretched captives followed him as if they had been used to this condition all their lives. Here were naked little boys, running alone, perhaps thinking themselves upon a holiday; near at hand dragged mothers with babes at their breasts; girls of various ages, some almost ripened into womanhood, others still infantile; old men bent two-double with age, their trembling chins verging towards the ground, their poor old heads covered with white wool; aged women tottering along, leaning upon long staffs, mere living skeletons … then followed the stout young men, ironed neck to neck! This was the first installment of the black bullion of Central Africa; and as the wretched procession huddled through the gateways … the creditors of the Sarkee looked gloatingly on through lazy eyes, and calculated on speedy payment.

Only humans are capable of inhumanity. It is part of human nature and I don’t think that it can be eradicated. It takes different forms and shapes depending on the fashion of the era and the compulsions of the age. The compulsions range from monotheistic madness (the Crusades, the Islamic hordes destroying peaceful non-Muslims) to nationalism (the Nazis slaughtering Jews, the Americans carpet-bombing countries, the Belgians killing millions in the Congo, the Pakistani army slaughtering between 3 and 6 million other Pakistanis, … the list goes on) to natural resources (too many to mention but Iraq is the lastest example.)

{To be concluded tomorrow.}

  • http://krish78.blogspot.com krishna

    hi atanu,

    It is so true, that rich are so callous.
    and some times, acts of terror(like 9/11) does
    make them think and i think, america started thinking after 9/11 and they should start thinking more, life is uncertain. why store money for their grand, grand childeren.

    money should flow. all these people and policies which acts as huge big dams. lets damn these dams.

  • http://jyote.blogspot.com Jyoti Iyer

    A good example of rampant inhumanity would be religion: what other institution persecutes simply because they pretend they have the divine right to?

  • infinisri

    “Only humans are capable of inhumanity” – so true yet appears to ba a tautology. Tautology = nothing said.

    Yes, the poor in India have grown as you say. We have to establish if this is because of or in spite of that actions that impact that situation.

    To ascribe a collective motive for the rich and well to do – also begs the question.

  • http://prashantmullick.com Prashant

    I’m struggling with what you state as a matter of fact, that if the rich choose “to bring about the end of poverty … lead to less favorable outcomes for the rich and powerful”.

    If there are poor in society, their group will drain resources away from the rich and lead to all the problems we see in the actual world of poverty, malnutrition, etc. etc.

    So is it really not in the interest of the rich to eliminate the poor and make them richer?

    Or is it that we are talking about not really the “rich and powerful” but the “rich and stupid”?

  • Anand Chandrasekaran

    Belated happy birthday, Atanu!

  • http://uspeed.blogspot.com uspeed

    shud I be happy that being better off than most in India, I have the advantage of a system that is designed to keep the poor-poor and the rich-rich. Or shud I be sad that many Indians will continue to be poor for a long time.