{"id":302,"date":"2011-06-25T18:39:02","date_gmt":"2011-06-25T17:39:02","guid":{"rendered":"http:\/\/proutistuniversal.info\/?page_id=302"},"modified":"2012-04-29T12:19:56","modified_gmt":"2012-04-29T11:19:56","slug":"the-economic-theory-of-prout","status":"publish","type":"page","link":"https:\/\/proutistuniversal.info\/?page_id=302","title":{"rendered":"The economic theory of Prout"},"content":{"rendered":"

The Economic Theory of PROUT<\/strong><\/span><\/h2>\n

It must be mentioned at the very outset that socialism in the real sense of the term is not merely confined to the abolition of private property and state control of economic activity. True socialism cannot be achieved by neglecting the human aspect.\u00a0 So-called economic freedom is not an end in itself; it becomes a degenerative process if it fails to create an environment of security and justice. Economic progress should not remain dependent on selfishness.<\/p>\n

\u00a0 \u00a0 \u00a0 \u00a0 E. F. Shumacher writes:<\/strong><\/span>\u00a0“If human vices such as greed and envy are systematically cultivated, the inevitable result is nothing but the collapse of intelligence.\u00a0 A man driven by greed and envy loses the power of seeing things as they really are, of seeing things in their roundness and wholeness, and this very success becomes a failure. If the whole science becomes infected by their vices, they may achieve astonishing things but they become increasingly incapable of solving the most elementary problems of everyday existence.<\/em><\/p>\n

\u00a0 \u00a0 \u00a0 \u00a0The gross national product may rise rapidly as measured by the statisticians, but not as experienced by the actual people, who find themselves oppressed by increasing frustration, alienation, insecurity and so forth. After a while the gross national product refuses to rise any further, not because of scientific or technological failure, but because of a creeping paralysis of non-cooperation, as expressed in various types of escapism in the past, not only of the oppressed and exploited, but even of highly privileged groups”.[1]<\/a><\/em><\/p>\n

Human beings strive for higher values in life – such as mutual love and cooperation. A spirit of service and welfare toward all members of the society should be the guiding force of any economic system. Wealth should not be considered only in a material sense. There is subtler wealth like supra-mundane and spiritual wealth.\u00a0 As material wealth lies hidden in different layers of the earth and atmosphere, similarly supra-mundane wealth of higher knowledge and wisdom are hidden in the different layers of the mind.\u00a0 By psycho-spiritual research we can uncover this potential knowledge and power, and utilise it for the greater interests of human society.\u00a0 As mentioned earlier, progress denotes physico-psycho-spiritual advancement or in other words to develope the quality of life.<\/p>\n

Economic development is not an isolated process.\u00a0 It is clearly dependent on the existing social psychology, culture, educational patterns, socio-political structures, natural environment and other infrastructure provided by the society. Human factors should play the dominant role in designing and controlling economic activities.<\/p>\n

To quote E. F. Shumacher<\/strong> again<\/span>, “The economics of permanence implies a profound reorientation of science and technology, which have to open their doors to wisdom, and in fact, have to incorporate wisdom into the very structure. Scientific and technological solutions which poison the environment and degrade the social structure and man himself are of no benefit, no matter how brilliantly conceived or how great the superficial attraction. Even bigger machines, entailing even bigger concentrations of economic power and exerting greater violence against the environment, do not represent progress: they are a denial of wisdom<\/em>.<\/p>\n

\u00a0 The neglect, indeed the rejection of wisdom has gone so far that most of our intellectuals have not even the faintest idea what the term could mean.\u00a0 As a result, they always tend to try to cure a disease by intensifying its causes. The disease having been caused by allowing cleverness to displace wisdom, no amount of clever research is likely to produce a cure. But what is wisdom?\u00a0 Where is it?<\/em><\/p>\n

Here we come to the crux of the matter: wisdom can be read about in numerous publications, but it can be found only inside oneself. To be able to find it, one has first to liberate oneself from such masters as greed and envy.\u00a0 The stillness following liberation – even if only momentary – produces the insights of wisdom which are obtainable in no other way”. [2]<\/a>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/em><\/p>\n

As material wealth is limited, it cannot quench the unlimited thirst of the human mind. Both supporters of capitalist and state controlled economies have neglected this inevitable truth. This is the reason why the tremendous growth in science and technology has neither ensured peace nor strong social relations nor fulfilled the minimum requirements of all .\u00a0 Rather, it has brought the world to the brink of devastation and has tended to disturb social relationships.<\/p>\n

The spiritual orientation in collective life will revitalise the human aspect and inspire people to build a healthy society in a spirit of cooperation, free from the grip of greed and envy, and also beyond the reach of power-hungry dictators.\u00a0 Wisdom in deeper sense of the term \u00a0must be the guiding factor in designing the economy.<\/p>\n

Ownership in PROUT<\/strong><\/h3>\n

The capitalist economic structure is based on the theory of unlimited private property and individual ownership. In order to sanctify this principle, Western economists based their economic principles on land, labour, capital and enterprise, followed by suitable doctrines of distribution, rent, wage interest and profit. In the Marxian doctrine of ownership, however, state control of property demolishes the idea of collective ownership of property.<\/p>\n

What do we actually mean by “property” and “ownership”? The basic divisions of private property are:<\/p>\n

    \n
  1. Moveable or immovable property essential for existence, such as food, shelter, clothes medicine and other consumer goods<\/span><\/li>\n
  2. Property that helps in productive activities: machines, tools, land, etc.<\/span><\/li>\n
  3. Idle property, for example, if the owner of the property is unable to directly use, guide or control it.<\/span><\/li>\n<\/ol>\n

    In the first case, the accumulation of such property as is essential for one’s minimum requirements has to be accepted. Physical wealth is limited, hence there is no justification in allowing uncontrolled accumulation.\u00a0 In the second case, private property of a working proprietor is natural and healthy.\u00a0 In the third case, it is natural that beyond a certain limit, property owners have to depend on others for its management.\u00a0 In such cases they are passive owners and live parasitically on the labour of others.<\/p>\n

    Thus, there are basic distinctions between creative and passive property. Those who raise objections against property rights without distinguishing between these characteristics of property, deny basic rights for economic freedom and negate initiative, the lever of economic progress.<\/p>\n

    Private property or ownership in general is not harmful if it remains within certain limits.\u00a0 It should not, however, be allowed to grow out of proportion, resulting in the concentration of economic power. Commenting on the idea of private ownership, E. F. Schumacher expressed similar ideas in his book Small is Beautiful.<\/em><\/p>\n

      \n
    1. If an owner employs a salaried manager, then he cannot claim to be the proprietor.\u00a0 If he appropriates more profit than his fair salary, he is exploiting. He can expect a return on his capital, but not beyond a limit fixed by the collective body.<\/li>\n<\/ol>\n
        \n
      1. The owner is not responsible for the high return on profit, but the whole organisation.\u00a0 It should be shared amongst the members of the organisation, and if it is used as capital for further expansion, it should be collectively owned.<\/li>\n<\/ol>\n
          \n
        1. In the case of large-scale enterprises, the idea of private ownership is an absurd proposition.\u00a0 To quote R. H. Tawney, “Such property may be called passive property, or property for acquisition, for exploitation or for power to distinguish it from the property which is actively used by its owner for the conduct of his profession or the upkeep of his household. It is questionable, however, whether economists should call it property at all, since it is not identical to the rights which secure the owner the produce of his toil, but is the opposite of them”.[3]<\/a><\/li>\n<\/ol>\n

          According to Prout, in reality no one owns anything permanently. An object or property is generally utilised by an individual or group for a certain period of time only, before it is passed on to some other person after the former has inherited it to others.\u00a0 Everyone has the right to utilise any means of production according to one’s capacity, considering it as the collective property of the society.\u00a0 So, neither a few individuals nor the state should have the absolute right of ownership to property (means of production).\u00a0 All property is the joint property of the society as a whole in principle. But to facilitate proper utilisation, decentralised control over property ,as civic rights should be allowed in legal terms on a localised basis. The right to own and control the means of production will depend on individuals\u2019 need for minimum requirements and their capacity to control and manage an enterprise directly.<\/p>\n

          What is the psychology behind accumulation?<\/strong><\/h3>\n
            \n
          1. For individual security<\/span><\/li>\n
          2. For the security of one\u2019s family<\/span><\/li>\n
          3. To control economic power<\/span><\/li>\n
          4. Excessive greed.<\/span><\/li>\n<\/ol>\n

            Therefore, while restricting accumulation, the above psychological reasons must be taken into consideration.\u00a0 To ensure security in the physical and psychic sense, the purpose to accumulate reasonably for the first two reasons will be considered as valid..\u00a0 As far as the third cause is concerned, Prout does not support the centralisation of economic power either by a few individuals, or by the State. To restrict accumulation for the 4th<\/sup> cause, legal restriction need to be imposed till the psychology of greed is pacified.<\/p>\n

            Without creating a sense of security in the physical and psychological sense, as well as a spiritual environment conducive to harmony and satisfaction, it is futile to check the disproportionate accumulating tendencies of the human mind. In order to achieve this, it is essential to have job security, availability of consumer goods, abolition of profit motivation, removal of greed and envy, political stability, social justice and a basic level of morality amongst the people.<\/p>\n

            However in case of intellectual and spiritual wealth no restriction can be imposed. But those wealth should be utilised for human welfare.<\/p>\n

            Guaranteed Minimum Requirements (As proposed in U.N resolution adopted in 1950)<\/strong><\/h3>\n

            The foremost criterion of a sound economic system is that the minimum requirements for each individual must be guaranteed. This includes food, shelter, clothes, medicine and education. <\/strong>This is only possible in a society where:<\/p>\n

              \n
            1. Each individual earns enough to have proper purchasing capacity. That means the society needs a condition of full employment. Many countries have introduced a minimum wage system, but this is not enough. People should have jobs and income to ensure sufficient purchasing power. Secondly, on principle the maximum wage and income need to be fixed in the long run.<\/li>\n
            2. Consumer goods should be made available.\u00a0 That means there must be a reorientation of the production and distribution machinery. Production according to consumption should be the motivation instead of profit by all means motive. In this way, the tendency to exploit, artificial scarcity and speculation can be eliminated.<\/li>\n
            3. Social control over prices and wages should be introduced so that it follow the economic laws of the market, provided the exploiting machinery, artificial scarcity, and speculation are eliminated.<\/li>\n<\/ol>\n

              To achieve the above objectives, the following steps are essential:<\/p>\n