There is a correlation between economics and morality. Economics revolves round 'incentive'. It has three aspects--- economic, social and moral. Morality implies how we like to see the society moving on the basis of ethics. Economics shows how this perception actually works in the society.
We may recall Adam Smith, the father of classical economics. He was mainly a philosopher. He was a moralist. Through exercise of knowledge and research of contemporary development, Adam Smith got the status of an economist. His book 'An Enquiry into the Nature and Causes of the Wealth of Nations' crowned him as the great economist and the proponent of the capitalist economy. However, when capitalism was just creeping in, his famous book, 'The Theory of Moral Sentiment' was published in 1759 long before the 'Wealth of Nations'. He was moved by the emerging changes in the society brought forward by new forces. Just some numbers (like growth, savings, investment, etc) could not amaze him. He was moved to see the impact of emerging trends of capitalism on human beings. Adam Smith keenly observed what people were thinking, how they were behaving and what they were doing with the values of life in the newly emerging situation. He depicted honesty and dishonesty inherent in men in his book, "The Theory of Moral Sentiment." He drew a picture of fiction between individual's desire and the values of the society. He deplored the crook ways of gaining wealth that destroys social values. His philosophy was not against capitalism, He was for moral content in economic progress.
Bangladesh has a free economy. There are laws and rules which are designed to control illegal and immoral activities. In spite of all these, corruption is all pervasive in the society and the economy. There are scandals in the banking sector. There are cases of over-and under-invoicing. There is deception in tax payment. There is abject corruption in development works and extortions. There is open commission business. There are frequent news stories about these incidents. Even there are reports about corruption in the social safety net programmes that meant for the poorest of the poor. There are allegations about misappropriation of gold supposed to be contained in the crests given to our foreign friends who had espoused the cause of the liberation war of 1971. There are innumerable examples which have given birth to the rise of some people like Nur Hossain of Narayanganj in wealth and power earned through extortion under political patronage.
All these led to concentration of huge illegal wealth in the hands of some people who in turn have become a powerful class or a pressure group in the society. Here comes the question of 'black money'. Some of these people launder money, send it abroad, keep deposits in foreign banks and buy flats or houses abroad. Reportedly, many Bangladeshi people have bought houses and flats in the USA, Canada, Malaysia and Dubai. Many of them did it with illegal fortunes. The government is helpless to trace such resources. In some cases, the government knows who those people are. Yet, they are benign with them.
A portion of ill-gotten money, however, remains at home. The holders need to make it legal. If successful, it is officially called 'whitening of black money'. The government has continued to allow such whitening in the fiscal 2014-15 in real estate sector. This will give some people the opportunity of legalising their ill-gotten money.
In fact, over the last couple of years, the government has been allowing legalisation of black money. The result, in terms of the number, has not been found encouraging. Over last 7 years, on an average, the annual amount of whitened money did not exceed Tk 5,000 million. The tax collected on it did not mean anything on the government revenue collection of every year. The accumulated tax collected by the National Board of Revenue (NBR) since 1972 till last fiscal on whitening of black money was about Tk 14,500 million. The amount is not even one per cent of the revenue target of the NBR for FY 2014-15.
The amount is not important. The consolation to and scope for the holders of black money are immense. They can now invest it and enjoy extravagant life. They are the heroes! People around them, who actually know them, can understand their power of making money in the ongoing social order.
One can also understand the influence and pressure of such groups. The civil society is against whitening of black money. All economists have voiced against it. The Finance Minister was seemingly not in its favour. At the post-budget briefing on June 6 last, he said, "All sorts of scope for legalising black money are no more" and categorically said, "I tell you that the provision is cancelled from today". But political pressure from inside seems to be so high that he had to backtrack on his position. On June 28 last, he told the parliament that the facility would be available in the next fiscal in two ways---legalisation of undisclosed income by paying a 10 per cent penalty on top of normal tax and investment in real estates. However, the scope for investments in treasury bonds has been withdrawn. Defending his position, the Finance Minister said, "These two provisions can be extended as they are necessary to ensure balance in tax payment system". Whatever is the defence, the civil society was found critical about it. They thought that the Finance Minister made an apparent U-turn from his original stance and yielded to the pressure of corrupt politicians, bureaucrats and influential realtors. To them, the move is against economic justice and morality.
The recognition of black money is the manifestation of corruption in the society. All issues of corruption in Bangladesh have been found to have political flavour. Whether these are bank scandals, development-related scams, job scandals, tender manipulation and extortion issues, the observers find political patronage and coverage in many of these. Like Adam Smith, the conscious people of Bangladesh are observing how the political order of the day is influencing the thinking, behaviour and activities of some people and what they are doing with the values of life.
The writer is an economist and columnist. chowdhuryjafar@ymail.com
Economics of morality and Bangladesh
Jafar Ahmed Chowdhury | Published: July 12, 2014 00:00:00 | Updated: November 30, 2026 06:01:00
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