The Intelligent Woman's Guide to Capitalism

(With apologies to George Bernard Shaw, who was a Fabian socialist and wrote a very popular "Intelligent Woman's Guide to Socialism.)

Till fairly recently, both economic as well as political activity were the reserve of men. Thus, women had to depend on men for everything, and this led to subjugation.

Fortunately, better days are here. The suffragettes fought for the vote and got it. Yet, despite 60 years of voting, millions of women in India remain backward and poor. The vote is obviously not enough. Some, like the socialist economist Amartya Sen and his protégé Manmohan Singh, say they need “education” – from the government. But prosperity is delivered by markets, and the government of India is scarcely a lamp of learning. Women must therefore think hard as to where their true interests lie. Only then can they campaign for the right policies.

It is not true that women did not “produce” or that they were “ignorant” in the centuries gone by. All over the world, women cooked delicious food, kept homes clean, and managed household budgets. In India, women produced pickles, papad, chutneys, butter, ghee and so many other wonderful things. Tribal women still produce alcoholic drinks like mahua, handia and apong. But all this was for “self-consumption”. These were not produced for “exchange”. If all these are produced for exchange in the market economy, it would become evident that women indeed possess a great deal of useful “knowledge” – even without formal education. They are not ignorant.

Thus, the first step towards the liberation of all women lies not in the vote, nor in “education”; rather, it lies in the freedom for all women to participate in the exchange economy of the market with whatever knowledge they may possess or choose to acquire. Indeed, pickles, papads and chutneys are very big businesses today. Street food is another. Entertainment is a multibillion dollar industry now and traditionally women have always been proficient in music and dance. Rather than the vote, which is “political freedom”, or government education, which can seriously damage the mind, women today should strive for the Liberty to engage in economic activity, which is Economic Freedom. This is a term not found in the lexicon of the socialists.

At the outset, let it be clearly understood that Gandhi got it all wrong. His ideal of “village self-sufficiency” means economic suicide for both rural men and women; but more so for women, because if their men are poor, women are poorer still. Self-sufficiency is production for use; capitalism is production for exchange. If rural women produce surpluses for exchange, they will discover that the markets in which they can find sufficient customers are invariably located in cities and towns. Stuck in a sparsely-populated village, a woman might sell two jars of pickles. But if she took her output to a crowded city, she might sell a hundred kilos of the stuff. Thus, villages, self-sufficiency and “rural development” must be ditched in favour of urbanization: hundreds of free trading cities and thousands of such towns, instead of millions of self-sufficient village economies. Women must produce for exchange in urban market centres. This is my Lesson # 1.

On to Lesson # 2: As far as politics and government are concerned, what these must be able to provide women is Liberty Under Law. Nothing else – no “sops”, no “reservations”. There must not be any politically imposed restrictions placed upon women (or men) when they go to the urban markets. It is here that we find the critical problem that many, many women face in our cities: that the Law does not give them Liberty; rather, the Law is an instrument of coercion. This applies not only to women street vendors and petty traders, but also to women performing artistes, right through to women working in professions like tending bars and serving food and drink. Indeed, although we in India have a huge film industry, we do not possess a “nightlife” industry – where lakhs of women could find gainful employment. There isn’t a Moulin Rouge in any Indian city. Nor are there any casinos. Even bars are strictly licensed, and entertainers are discouraged by the “entertainment tax”. These are areas where women are usually employed en masse, at least in the western world. In our own land, the nautch-girl was a fixture of the Mughal court; she was there in every city; even the British were entertained by her; but our modern-day democracy has thrown her out – and this is repression via legislation. So my Lesson # 2 reads: Fight for Economic Freedom – the liberty to engage in consensual capitalistic exchanges that hurt neither buyer nor seller.

Now, the difference between primitive “production for self-consumption” and capitalistic “production for exchange” is that the latter requires Capital as “investment”. With capitalism, we have “roundabout methods of satisfying wants”. For example, till fairly recently, all yoghurt produced in India was in the home, consumed inside the home itself. Today, we have big companies producing yoghurt. Instead of a woman milking her cow and preparing the yoghurt – which is “direct satisfaction” – we now have the “roundabout” method of companies buying humungous amounts of milk from lakhs of cattle-owners, transporting them to distant factories in big trucks, making tonnes of yoghurt and packaging it, transporting these to shops, advertising these offerings, etc. This “roundabout” method is Capitalism – and this requires capital to invest. My third lesson is on how women can save the capital necessary to invest in capitalistic enterprise.

At the basic level, we save if we spend less than we earn – and this is something every intelligent woman understands full well. (Though Lord Keynes didn’t: but that’s another story.) But there are two factors that erode our savings: taxes and inflation. It is in the interest of all women to campaign for lower taxes (so oppose Manmohan Singh’s “education tax”) and for an inflation-free currency. Inflation is a hidden tax. As the value of the currency falls, so does the value of one’s savings. The gainer is the borrower who takes a loan today and pays back many years later when the money has lost much of its value. The government also gains. Thus, women should understand inflationism and oppose it: Low taxes, balanced government budgets, sound money – these are policies that will allow millions of women to save and invest, and engage in Capitalism. Whenever a finance minister announces a “budget deficit” or another populist giveaway, all Indian women should cry “Foul!” This is my Lesson # 3.

Fourth: Capitalism is based entirely on private property (socialism exalts “collective property” – like the steel plants Nehru built). The unwritten law of any market is that the goods arrayed before a vendor belong to the vendor. If we want some of them, we must strike a bargain and make the exchange, whereupon the ownership rights are reversed. Now, imagine what would happen in the market if the Law said that bread belonged to all, and all were free to consume it: communism. The result would be there would be no bread offered for sale in any market. There would be wheat, flour, chappatis – but no bread. The “natural law” of private property cannot be dispensed with without causing immense economic dislocation.

What properties do women need? Women are homemakers: they need homes. Homes are the most essential private properties. Since all cannot afford to buy them, they rent. But what happens if the Law says that the actual owner of the house cannot raise his rents to market levels and cannot evict tenants who refuse to pay what he demands? As in the case of “collective bread” above, the result would be that rental housing would not be offered on the market. Prospective tenants would not find rental housing. They would have to stay in slums. This is what is happening in every Indian city today. Yet, every bai in Mumbai would have decent rooms on rent if all legislation on “rent control” was repealed. Slums would disappear. I hope my readers will now instruct their bais to take to the streets in opposition to rent control. This is my Lesson # 4.

Finally, what good is the money earned if there is nothing much to buy with it? – as in our socialist heydays. Women are great shoppers. They love shopping. And they have the nose for the best deals. What good can these excellent noses do if foreign products are left out? Free trade is in the interest of all shoppers – so that they can purchase, with their hard-earned wealth, the best goods the world has to offer. So campaign for free trade as an essential component of Economic Freedom – the freedom to engage in consensual capitalistic exchanges with foreigners. This is my Lesson # 5.

Free trade, sound money, private property, liberty under law, production for exchange in urban markets and the consequent rapid urbanization of India – it is with these that all women can prosper. When they do so, men will gain too, because there is a law in Economics that says: When any good is sold it creates the demand for all non-competing goods and services. Thus, when a woman sells a tonne of papad, she will possess the means to buy a good car – manufactured by male engineers.

And even we men will prosper.