China’s Iron rice bowl policy

Poor are hardworking, they are very calculated (i.e. they plan their expenses and never waste money on frivolous trinkets), they are very versatile & adapt to the situations and they don’t mind even travelling far and wide to meet their goals. Yet for generations they are poor. Why? They were born poor and are now trapped into a vicious circle. If you belong to a country with predominantly poor/marginal citizens, a lot of them farmers on hand-to-mouth sustenance, what would you do to transform the country?

It’s not an overnight job, China formulated their Iron-Rice Bowl policy way back in 1949 and today they are reaping its rich dividends. There have been several theories around what Renaissance started in Italy, Why industrial Revolution started in England, Why in the early 20th Century America became the industrial powerhouse and why Japans overtook them. But I am yet to read about one single theory which says why China has become the manufacturing hub of the world. Because what China did was transformational and it changed the entire DNA of the country most economists don’t like to acknowledge this reality.

The viscous cycle that I was talking about was education & healthcare. Without proper education the masses don’t have the tools and knowledge to offer anything more than unskilled manual labor. But if the children work instead of going to school then they can never be truly educated. I am sure there are a couple of exceptions, but generally child laborers are destined to work their entire life as unskilled daily-wagers. China has 100% literacy while in India 1/3 of the people still cannot read or write. Furthermore we have created a pseudo-caste system revolving around English. So that anybody who is not convent educated and fluent in English will always feel inferior.

The second element of the viscous cycle is “Healthcare”. I have rarely met any poor family that is not able to save a considerable percentage of their daily income on a regular basis, while most middle class families would take lifestyle loan and show little or no financial planning. This fund enables them survive not only the rainy day but also improve their earning capacity through productive assets (vehicle, shop, land, cell-phone, etc.) So over a decade through diligence & discipline most families can escape poverty. However more often than not you would see is that a disease or injury would force the family to dip into their savings and borrow heavily to pay for the medical treatment. This unfortunate & unforeseen hardship sets the family back by 10-15 years and often leads to splitting of the family so that individuals could survive and escape the debt burden. Hence in absence of a strong affordable public healthcare program, no poor can even dream to be happy. In China I have seen expats & senior officials of rich companies often going to public hospitals. In India…. Anybody who can afford will find out reasons of not going to a public doctor (I was an exception, my daughter was born in a government hospital)

It’s been 67 years since India’s independence but are we free yet? Do we have the culture and environment around me which enables us reach our fullest potential? Is the system around us empowering us for “pursuit of happiness”? India is on the verge of the next General Election and these are the questions that are bugging me. A few slogans don’t amount to anything unless the systematic rot in the system is addressed.

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