Production and not charity
Saturday, 14 June 2008
The economic principles are that helping production will make a society wealthier, richer and happier in the long run. Some amount of resources must be devoured on consumption. However, if greater resources are spent on sheer consumption than production, then short term gratification is possible from the consumption. But longer term economic insecurities are invited from foregoing production of goods and services and wealth and income creation.
Budget for fiscal year 2008-09, as it appears to me, would be diverting huge resources of the state on charitable or administrative spending not related to production activities. Large scale shift of resources to poorer sections of the population has been planned without a precedence in this nation's history. It would not matter if this resources diversion to the poor would mean that the poor would engage in highly productive activities with such resources. As it is, the resources will be spent on their various sheer consumption needs. Entrepreneurs will be denied funds for doing productive activities while the poor will gain from having their consumption urges satisfied considerably.
But such greater spending on consumption will not help economic growth when economic growth alone is the surest way for winning over poverty on a sustainable basis. Our policy planners appear to have missed this simple truth while formulating the budget for the next fiscal year with an eye for earning popularity.
Irteza Reza Chowdhury
Easkaton, Dhaka
Budget for fiscal year 2008-09, as it appears to me, would be diverting huge resources of the state on charitable or administrative spending not related to production activities. Large scale shift of resources to poorer sections of the population has been planned without a precedence in this nation's history. It would not matter if this resources diversion to the poor would mean that the poor would engage in highly productive activities with such resources. As it is, the resources will be spent on their various sheer consumption needs. Entrepreneurs will be denied funds for doing productive activities while the poor will gain from having their consumption urges satisfied considerably.
But such greater spending on consumption will not help economic growth when economic growth alone is the surest way for winning over poverty on a sustainable basis. Our policy planners appear to have missed this simple truth while formulating the budget for the next fiscal year with an eye for earning popularity.
Irteza Reza Chowdhury
Easkaton, Dhaka