“And the great owners, who must lose their land in an upheaval, the great owners with access to history, with eyes to read history and to know the great fact: when property accumulates in too few hands it is taken away. And that companion fact: when a majority of the people are hungry and cold they will take by force what they need. And the little screaming fact that sounds through all history: repression works only to strengthen and knit the repressed. The great owners ignored the three cries of history. The land fell into fewer hands, the number of the dispossessed increased, and every effort of the great owners was directed at repression. The money was spent for arms, for gas to protect the great holdings, and spies were sent to catch the murmuring of revolt so that it might be stamped out. The changing economy was ignored, plans for the change ignored; and only means to destroy revolt were considered, while the causes for revolt went on.”
— From The Grapes of Wrath by John Steinbeck
“I want to go home,
but home is the mouth of a shark
home is the barrel of the gun
and no one would leave home
unless home chased you to the shore.”
— From “Home” by Warsan Shire
“The moderation in the growth of remittances will be hard on many poor people. The affected countries may have to consider creative ways of smoothing the shock. Fortunately, migration and remittances can be leveraged for innovative financing.”
— From the World Bank, “Remittances growth to slow sharply in 2015”
This paper is an attempt to understand the relationship between the forces of global capital((Global capital is understood here as the combination of global financial institutions (banks, investment funds including private equity funds and hedge funds, insurance companies and real estate firms) and transnational corporations, with the support of prominent and influential actors and institutions in academia, media, communications and technology, law, politics, and research and policy institutions.)) and the mass movement of the global poor and dispossessed that is unfolding in today’s migration crisis. It begins with an examination of the April 2015 World Bank briefing on remittances as a way to understand the scope of this crisis.((Remittances are the funds sent by expatriates to their country of origin via mail, wire, or online transfer.)) It then looks more closely at the situation of India, the top recipient country for remittances in 2014, as an example of what is on offer as a solution.
REMITTANCES AND THE GLOBAL SOCIAL CRISIS
Millions of people in the world send money back home to their families and communities every day. These remittances are an important source of both family income and national resource, sometimes accounting for more than 20 percent of a country’s gross domestic product (GDP).((Gabi Afram, The Remittance Market In India: Opportunities, Challenges and Policy Options, The World Bank (2012), p. 1 (figure 1) https://www.cbd.int/financial/charity/india-remittance.pdf.)) According to the 2015 briefing on remittances from the World Bank, “officially recorded remittances to the developing world are expected to reach $440 billion in 2015, an increase of 0.9 percent over the previous year. Global remittances, including those to high income countries, are projected to grow by 0.4 percent to $586 billion.”((Migration and Development Brief 24, Migration and Remittances Team, Development Prospects Group, The World Bank, April 13, 2015 https://siteresources.worldbank.org/INTPROSPECTS/Resources/334934-1288990760745/MigrationandDevelopmentBrief24.pdf. See also, “Remittances growth to slow sharply in 2015 as Europe and Russia stay weak,” Press Release, The World Bank, April 13, 2015 https://www.worldbank.org/en/news/press-release/2015/04/13/remittances-growth-to-slow-sharply-in-2015-as-europe-and-russia-stay-weak-pick-up-expected-next-year.)) Due to the global economic slowdown, a parallel slowdown is being projected in the growth of remittances. However, “the number of international migrants is expected to exceed 250 million in 2015, and their savings and remittances are expected to continue to grow….In line with the expected global recovery next year [2016], the global flows of remittances are expected are expected to accelerate…to reach an estimated $610 billion, rising to $636 billion in 2017. Remittance flows to developing countries are expected to recover in 2016 to reach $459 billion, rising to $479 billion in 2017.”
[aesop_image img=”https://kairoscenter.org/wp-content/uploads/2015/11/4309914820_cbf58e460e_o.jpg” credit=”Georgia Popplewell via Flickr” alt=”Modinomics” align=”center” lightbox=”on” caption=”Lines outside of money transfer agencies in Haiti, where remittances are a major portion of national income.” captionposition=”left”]
While these remittances are traversing the world, there are patterns to note among destination and recipient countries: “The top five migrant destination countries continue to be the United States, Saudi Arabia, Germany, Russia and the United Arab Emirates (UAE). The top five remittance recipient countries, in terms of value of remittances, continue to be India ($70 billion), China ($64 billion), Philippines ($28 billion), Mexico and Nigeria.” The report also suggests that these remittances are an untapped financial resource: “as much as $100 billion in migrant savings could be raised annually by developing countries by reducing remittance costs and migrant recruitment costs, and mobilizing diaspora savings and philanthropic contributions from migrants.”((World Bank 2015 Press Release.)) It further suggests that, “future inflows of remittances can be used as collateral to facilitate international borrowings by national banks in developing countries. Remittances can also facilitate access to international capital markets by improving sovereign ratings and debt sustainability of recipient countries.”
There are two points to draw out of this analysis from the World Bank: (1) although just a fraction of global GDP (roughly 0.59% of global GDP, which is estimated at $74 trillion), there is interest in tracking and understanding this flow of money; and (2) the suggestion that diaspora communities may be mobilized by their countries of origin at a broader level than peer-to-peer giving.
First, the attention these funds are receiving is in part because remittances represent a large and relatively stable source of money, especially when compared with large capital flows from financial institutions and lenders. “At present, capital flows into emerging markets remain volatile and relatively short term. In some countries, flows have turned negative in recent years….Small and medium businesses, moreover, are denied access to the vast pool of capital that the savings of developed countries represent.”((See summary of The Bridge to the Middle Class, which describes how volatile capital flows are disrupting national economies: “At present, capital flows into emerging markets remain volatile and relatively short term. In some countries, flows have turned negative in recent years….Small and medium businesses, moreover, are denied access to the vast pool of capital that the savings of developed countries represent.” https://www.cfr.org/economic-development/bridge-global-middle-class/p5568?excerpt=1).))
This volatility is facilitated both by the large amounts of capital that are concentrated in financial institutions and by the innovations in banking and global financial markets, which have enabled that capital to move around the world at the speed of light.((Mark Buchanan, “Physics in Finance: Trading at the Speed of Light,” Nature, February 11, 2015 https://www.nature.com/news/physics-in-finance-trading-at-the-speed-of-light-1.16872.)) Foreign direct investment (FDI) is one mechanism that has multiplied due to these innovations. Available to wealthy individuals and institutions such as multi-national enterprises, private equity funds, sovereign wealth funds and state-owned enterprises, FDI “projects” include mergers and acquisitions, building new facilities or infrastructure, the reinvestment of profits from overseas operations and intra-company loans. To be considered “foreign” direct investment, these projects must take place in economies outside that of the investor. The typical terms of FDI offer at least 10 percent management interest in the project (and/or control over management, technology or other crucial inputs).((FDI differs from indirect or passive investment in, for instance, public stocks and bonds. FDI usually also entails a degree of control over how the investment is used that is unique to this form of investment. For more information, see https://en.wikipedia.org/wiki/Foreign_direct_investment.)) Global FDI inflows in 2014 have been estimated at $1.2 trillion.((World Investment Report 2015, United Nations Conference on Trade and Development (2015), https://unctad.org/en/PublicationsLibrary/wir2015_en.pdf.))
Because it is an investment mechanism, FDI is more attracted to economies whose growth prospects can claim to offer favorable returns on investment. The World Bank’s “Ease of Doing Business” rankings((See World Bank, Ease of Doing Business Rankings, https://www.doingbusiness.org/rankings . These criteria are also applied to state-level governments, indicated as “sub-nationals” in the rankings list.)) are some indication of the factors that are taken into consideration, i.e., starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, and resolving insolvency. Not included in these rankings are the social implications of being an attractive investment opportunity, which are displacement, underemployment, exploitation, and exclusion of the world’s masses from the global economy, especially when that investment is pulled out of a country. Indeed, these large flows can “turn on a dime…big flows in suddenly become big flows out,” as Christine Cumming, First Vice-President and COO of the Federal Reserve of New York said in 2014.((Transcript, “Ensuring Stability in an Age of Globalized Finance,” Council on Foreign Relations, May 13, 2014 https://www.cfr.org/financial-markets/ensuring-stability-age-globalized-finance/p32997.)) These movements of capital are consequently unleashing waves of economic instability that recipient countries are left to resolve; and without the resources to do so, these crises are becoming flash points of global political instability.((The “Grexit”, for example, was looming for several years, following the 2008 economic crisis and the capital flight that followed in several countries in the European Union. See, e.g., “IIF’s Charles Dallara Says Greek Exit Somewhere Between Catastrophic and Armageddon,” The Telegraph, May 16, 2012 (https://www.telegraph.co.uk/finance/financialcrisis/9270754/IIFs-Charles-Dallara-says-Greek-exit-somewhere-between-catastrophic-and-armageddon.html; see also, Phillip Inman, “IMF Warns of Threat to EU Banks from Capital Flight,” The Guardian, October 9, 2012 https://www.theguardian.com/business/2012/oct/09/debt-crisis-imf.))
Remittances appear to stand in contrast to this volatility as a relatively more stable source of income. The April 2015 briefing even discusses their potential to help implement the Sustainable Development Goals.((World Bank Migration and Development Brief, p. 12.)) What is not discussed, however, is why this remittance flow exists and has been growing in past years: these monies are supporting poor, unemployed and under-employed family members, friends and communities back home, who have little else to rely upon. For example, in India – the largest country recipient of remittances – 4.5 percent of households receive remittances, with an average amount of just over $22; and over 60 percent of those monies go towards supporting family maintenance, i.e., their food, education, health, etc.((Gabi Afram, The Remittance Market in India, The World Bank (2012). It is unclear from the report whether the average about of $22 is per remittance or per periodic interval. The main point, however, is that these millions of people are dependent on even these small amounts of monies to meet their daily needs.)) In other words, tens of millions of households in India are relying upon these remittances to meet their basic needs.
This phenomenon of remittances is, therefore, grounded in a reality of poverty that is essentially forcing the mass movement of people in the world. The World Bank report assumes that the need for these remittances will persist and grow in the coming years. That is, there is an acceptance that poverty and economic insecurity will, in fact, increase, compelling greater numbers of people to migrate as their best or only option. What is on offer in this report is not a solution to the conditions that are causing these remittances, but an effort to contain what is emerging as a systemic global social crisis.((“Migrants and refugees streaming into Europe from Africa, the Middle East, and South Asia have presented European leaders and policymakers with their greatest challenge since the debt crisis.” (https://www.cfr.org/migration/europes-migration-crisis/p32874); see also, Damien Ma, “China’s 20 Percent Problem,” Foreign Affairs, August 25, 2015 https://www.foreignaffairs.com/articles/china/2015-08-25/chinas-20-percent-problem?campaign=china&sp_mid=49468590&sp_rid=c2hhaWxseWJhcm5lc0BnbWFpbC5jb20S1 on China’s 260 million-strong migrant workforce).))
This relates to the second point enumerated above on how these resources might be used. Net official development assistance (ODA) in 2013 was approximately $135 billion;((OECD Aid Statistics, https://www.oecd.org/dac/stats/.)) meanwhile global remittances in 2013 were just over $400 billion.((“Remittances to Developing countries to stay robust this year, despite increased deportations of migrant workers, says WB,” Press release, The World Bank, April 11, 2014 https://www.worldbank.org/en/news/press-release/2014/04/11/remittances-developing-countries-deportations-migrant-workers-wb.)) In addition to the annual flows of remittances, and as reported in the 2014 version of the same report, “migrants living in high income countries are estimated to hold savings in excess of $500 billion annually. These savings represent a huge pool of funds that developing countries can do much more to tap into.”((World Bank 2015 Press Release, World Bank 2014 Press Release.))
There is, here, some recognition that developing countries in particular do not have the resources to meet the needs of their citizens and residents. This is increasingly true of “developed” countries as well. In the pursuit of global capital, governments are induced to pursue trade, policy and regulatory mechanisms that effectively reduce their income potential. Some of these are indicated in the “Ease of Doing Business” rankings described above, but they also include privatizing natural resources and national institutions, creating tax havens and implementing austerity measures, all of which undermine a government’s ability to provide social services such as public education, health care, social security, and fire stations.((For instance, sixty percent of Mexico’s social welfare spending comes from its oil revenue. Pemex is Mexico’s national petroleum company and the world’s second largest privately listed company by total market value. It has been the subject of ongoing negotiations and public debate, including a call by the opposition party for a public referendum on proposals for energy reform and privatization made by President Nieto. See, Laura Carlsen, “Mexico’s Oil Privatization: Risky Business,” The Huffington Post, May 29, 2014 https://www.huffingtonpost.com/laura-carlsen/mexicos-oil-privatization_b_5400076.html; Yoshua Okan, “The Privatization of Mexico’s Oil Is a Scheme to Enrich the 1%,” alternet.org, March 18, 2014 https://www.alternet.org/world/privatization-mexicos-oil-scheme-enrich-1. This has been a large part of the history of structural adjustment programs recommended by the International Monetary Fund and World Bank through the implementation of “free market” reforms.)) Remittances are, therefore, presented as an alternative to public spending for the general welfare to supplement what the state either cannot do or will not do.
A privately funded welfare system, however, is of a fundamentally different character than publicly funded social programs, being predicated on individual philanthropy rather than understood as an obligation of a government to its people. Unless officially appropriated by the government in the form of taxes, this privatized form of welfare would be ad hoc and individually oriented, to some degree as it currently is, to boost particular household incomes in recipient countries. It could not, therefore, be a public resource to provide for the general welfare, but only some of a safety net to some of the people. If this is the option on offer, it is unclear whether anything like the general welfare would even exist as an aspect of modern governance and society.
Further, this kind of system would require that some segment of the global migrant population have enough of an income to keep this system afloat.((This has been the trend underlying recent proposals to immigration reform in the United States, with the shift towards employment-based immigration over family-based immigration.)) Yet, as technology and automation continue to eliminate jobs, there is no certainty as to what kinds of jobs will remain. Certainly, there will be an absolutely fewer number of jobs available, which means that these monies could very well be reduced dramatically or cease altogether in coming years. It also means more intense competition for the jobs that do exist amid greater economy insecurity, including in developed countries. This is already having the effect of growing anti-immigrant sentiments throughout Europe, the United States and even places like South Africa, further excluding and destabilizing diaspora communities and putting remittances flows at risk.
[aesop_image img=”https://kairoscenter.org/wp-content/uploads/2015/11/Syrian_refugees_strike_in_front_of_Budapest_Keleti_railway_station._Refugee_crisis._Budapest_Hungary_Central_Europe_3_September_2015.jpg” credit=”Mstyslav Chernov via Wikimedia Commons” alt=”Modinomics” align=”center” lightbox=”on” caption=”Syrian refugees demonstrate in front of Budapest’s Keleti railway station.” captionposition=”left”]
Without stable remittances, the possibility of social upheaval in recipient countries and global uprisings becomes only a question of time. The Syrian migration crisis is one instructive example. “Some 10 million people of Syrian origin lived in the diaspora by the time the uprising began, and their remittances have helped many families stave off the worst suffering. The diaspora paid rents, sent grocery money, shipped in medical supplies and wired emergency funds. But after four years of extended families depleting their savings, and as the needs back home keep mounting, the math has stopped working. This is one of the explanations underlying the death-defying flight of hundreds of thousands of Syrians into neighboring countries, Europe, the Persian Gulf and elsewhere.”((Elizabeth Dickenson, “After 4 Years of War, Why are So Many Fleeing Syria Now?,” The Huffington Post, October 22, 2015 https://www.huffingtonpost.com/elizabeth-dickinson/fleeing-syria-now-support-ran-out_b_8352146.html.)) With a climate crisis that is taking on epic proportions and the resource wars that will inevitably follow, the Syrian migration crisis is only the beginning of what is yet to come.
AN EXAMPLE: THE INDIAN DIASPORA AND GLOBAL CAPITAL
The Indian context is another example of how these migration networks are being shaped in the current moment. According to the April 2015 briefing, the top destination country for migration and the top recipient country of remittances, respectively, are the U.S. and India.((Following various impositions of austerity around the country, widening income and wealth inequality, and increasing public ire around police brutality against black and poor communities, immigration has become a rallying point in conservative American politics. Appealing to the cultural memory of populism and nationalism, the leading front-runner in the U.S. presidential race, Donald Trump, has blamed undocumented immigrants for urban violence, driving down wages, and raising welfare costs. See, John B. Judis, “The Return of the Middle American Radical,” National Journal, October 2, 2015 https://www.nationaljournal.com/s/74221/return-middle-american-radical?mref=home.)) India is, on the one hand appealing to the interests of global capital – and successfully at that, with its FDI up nearly fifty percent to $35 billion since Narendra Modi became Prime Minister in May 2014.((“In Boost for PM Modi, FDI Flows Hit Record High in FY15,” NDTV, May 26, 2015 https://profit.ndtv.com/news/market/article-in-boost-for-pm-modi-fdi-flows-hit-record-high-in-fy15-766118.)) On the other hand, it is facing an explosive domestic situation as relations between Hindus, Muslims and other religious minorities have deteriorated with the expanded influences of the Hindu nationalist right.((This activity falls under the broad banner of “The Sangh Parivar” and includes the Rashtriya Swayamsevak Sangh (R.S.S.), the Hindu nationalist (non-governmental) organization whose political wing, the Bhartiya Janata Party (B.J.P.), is currently in power. There is also a significant Hindu nationalist presence in the U.S., whose influence and outreach to the Indian diaspora (and their financial resources) through non-profit organizations have been documented in Hindu Nationalism in the United States: A Report on non-profit groups (July 2014) https://www.sacw.net/article9057.html; see also, David Palumbo-Liu, “Hindu Nationalism and Hi-Tech in Silicon Valley,” The Huffington Post, September 16, 2015 https://www.huffingtonpost.com/david-palumboliu/hindu-nationalism-hitech-_b_8148544.html.)) Most recently, the killing of a 50-year old at the hands of a mob in a village just on the outskirts of New Delhi – on the rumor that he and his family had beef in their home – has escalated these tensions. This follows on the controversy surrounding a “beef ban” that has been passed in 24 out of India’s 29 states, making the slaughter and consumption of beef illegal.((This is despite being a self-described secular country, the largest exporter of beef in the world, and with a majority of its population – including some of its 170 million Muslim population – consuming meat. See, Zahir Janmohamed, “India’s Beef with Beef,” Al Jazeera, October 10, 2015 https://america.aljazeera.com/opinions/2015/10/indias-beef-with-beef.html.)) There have also been several church burnings in Delhi and around the country.((Sudipto Mondal, “Bearing the Cross: Recent Attacks Against Christians,” The Hindustan Times, March 15, 2015 https://www.hindustantimes.com/india/bearing-the-cross-recent-attacks-against-christians-worrisome/story-SKCkeGQpV0bpVfY00ruOdO.html.))
This is inspiring widespread outcry and disillusionment among Indians in India and the U.S., calling into question the current administration’s ability to contain a volatile and escalating situation.((Nirmala George, “41 Writers Return Indian Award, Cite Climate of Intolerance,” Associated Press, October 14, 2015 https://abcnews.go.com/Entertainment/wireStory/41-writers-return-indian-award-cite-climate-intolerance-34465069; see also, Vivekananda Nemana, “Indian Leaders Narendra Modi faces disillusioned supporters on U.S. visit,” Al Jazeera, September 27, 2015 https://america.aljazeera.com/articles/2015/9/27/indian-leader-narendra-modi-faces-disillusioned-supporters-on-us-visit.html.)) It has also raised the concern of Indian business interests.((Rishi Iyengar, “Top Indian Business Leaders Warn Against Growing Religious Intolerance May Harm Economy,” Time Magazine, Nov 2, 2015 https://time.com/4096102/india-business-religious-intolerance/. See also, “Government Needs to Control Hindutva Elements to Protect Investor Sentiments,” NDTV, April 18, 2015 https://www.ndtv.com/india-news/government-needs-to-control-overt-hindutva-elements-to-keep-up-investor-sentiment-says-industrialist-755976.)) With global capital made skittish by social and political instability, there is an appeal being made to the Indian diaspora, whose remittances and savings represent a significant store of wealth that may facilitate further investment.((There are approximately 2.6 million Indians living in the U.S. and, on average, Indian households have a far higher income than the U.S. general population. In a 2014 report from the Migration Policy Institute, half of all Indian diaspora households had an annual income in the top 25 percent of the income distribution, meaning their incomes were over $90,000 per year. Over one-quarter of Indian diaspora households had annual incomes in the top ten percent, with incomes greater than $140,000. See, Migration Policy Institute, Diaspora Profile, The Indian Diaspora in the United States (July 2014).)) The Indian experience may, therefore, be indicative of the potential that the private wealth and resources of diaspora communities has as suggested in the World Bank’s report. It also suggests the broad range of resources that global capital interests are able to draw on, from the financial and capital resources of these communities to also the political, social and cultural position of emigrants.
For example, in September 2015, the Deepak and Neera Raj Center on Indian Economic Policy was established at the School for International and Public Affairs at Columbia University. The Center is “the first of its kind in the U.S.” and “will provide research and expertise necessary to inform policy decisions, deliver increased prosperity, and define India’s future role in the global economy.”((“SIPA establishes Deepak and Neera Raj Center on Indian Economic Policies,” September 22, 2015 https://sipa.columbia.edu/news-center/article/sipa-establishes-deepak-and-neera-raj-center-on-indian-economic-policies.)) It was funded by Deepak Raj, managing director of Rush Brook Partners and Raj Associates (two private investment firms that have investments in real estate and public and private securities) who gave $4 million, Columbia Professor and economist Jagdish Bhagwati ($500,000) and Udav Kotak, executive vice chairman and managing director of Kotak Mahindra Bank ($1 million).((Ela Dutt, “New Think Tank to Define India’s Future in Global Economy,” Desi Talk, September 25, 2015 https://epaper.desitalk.com/2015_09_25/files/assets/basic-html/page6.html; Kotak Mahindra Bank is the fourth largest Indian private sector bank by market capitalization, as of September 2014. (https://en.wikipedia.org/wiki/Kotak_Mahindra_Bank).)) One of the Center’s main staff is Arvind Panagariya, currently serving in the cabinet of Prime Minister Modi.
The Center was, in fact, established on the eve of P.M. Modi’s visit to the U.S. This was the second visit of his term and included a prominent trip to Silicon Valley where he met with Mark Zuckerberg, Sheryl Sandberg, and members of the Indian community. This trip raised the objections((Faculty statement on Narendra Modi Visit to Silicon Valley, https://academeblog.org/2015/08/27/faculty-statement-on-modi-visit-to-silicon-valley/.)) of over 100 scholars, many but not all of whom are South Asian, who called attention to P.M. Modi’s role in the communal violence that erupted in Gujarat in 2002((Under Modi’s tenure in Gujarat was the violence that broke out in 2002 that left, officially, 800 Muslims and 250 Hindus dead in just three days. Some accounts report upwards of 2000 Muslims were killed. Modi had been accused of initiating and condoning the violence, as have police and government officials who allegedly directed the rioters to Muslim-owned properties in the region. While Modi was officially cleared by a Special Investigation Team of the Supreme Court, there were more than 60 investigations into the incident by national and international bodies. The report from the National Human Rights Commission of India concluded that, “the state had failed to protect the rights of the people as set out in the Indian Constitution and faulted the Gujarat government for failure of intelligence, failure to take appropriate action and failure to identify local factors and players also.” This incident and controversy were the basis for the U.S. State Department denying Modi’s diplomatic visa – and revoking his tourist visa – in 2005. https://en.wikipedia.org/wiki/2002_Gujarat_riots#Aftermath.)) and the censorship and harassment that critics of his administration have experienced. As with his 2014 visit, many of the engagements were coordinated by highly placed members of the Indian community, who have prominent positions in academic and research institutions, the financial, tech and medical fields, media and the arts, and in local, state and national government.
[aesop_image img=”https://kairoscenter.org/wp-content/uploads/2015/11/Prime_Minister_Modi_and_President_Obama_shake_hands_during_a_joint_press_interaction.jpg” credit=”narendramodi.in” alt=”Modinomics” align=”center” lightbox=”on” caption=”President Obama and Prime Minister Modi shake hands during a recent visit to India by the president.” captionposition=”left”]
At the heart of Modi’s visit were the economic polices – sometimes referred to as “Modi-nomics” – that were instituted in Gujarat during his tenure as Chief Minister((The Chief Minister is the elected official leader of a state in India, a position similar to that of “Governor” in the United States.)) (2001-2014) and that have formed the basis of his economic reforms as Prime Minister. Known together as the “Gujarat Development Model,” these included opening the state up to more investment, including FDI, through large-scale infrastructure projects.((“The Gujarat Model,” The Economist, January 10, 2015 https://www.economist.com/news/finance-and-economics/21638147-how-modi-nomics-was-forged-one-indias-most-business-friendly-states.))
One of the innovations that was tested in Gujarat and is now being applied across the country is the idea of the “smart city.” These cities were initially designed as special investment regions with the latest in communications and digital technologies and infrastructure to attract global capital. This project has also been criticized on the grounds that these modernizations are only being instituted in these new cities and not in existing cities.((A. Srivasthan, “A Trip Down the Rabbit Hole of Modi’s Smart Cities Wonderland,” The Wire, May 6, 2015 https://thewire.in/2015/06/05/a-trip-down-the-rabbit-hole-of-modis-smart-cities-wonderland-3251/.)) One thing that is clear is that cities would necessarily result in the displacement of communities currently living in these areas and thereby also require greater security and surveillance mechanisms. With a price tag near $1 trillion, “much of the funding for smart cities will likely come from private developers and from abroad. The $100 billion Delhi-Mumbai corridor effort has a 26 percent investment from Japan. When Singapore Foreign Minister K. Shanmugam visited India earlier this month, he offered to build one smart city. And during his own visit last week, British Chancellor George Osborne extended a 1 billion pound credit line to help U.K. companies invest in Indian infrastructure.”((Casey Tolan, “Cities of the Future? PM pushes plan for 100 smart cities,” cnn.com, July 18, 2014 (https://www.cnn.com/2014/07/18/world/asia/india-modi-smart-cities/; see also, “India Builds First Smart City as Urban Population Swells,” Reuters India, April 15, 2015 https://in.reuters.com/article/2015/04/15/india-cities-smart-idINKBN0N52I320150415.))
It is difficult to say, however, what this development model has done for the people of Gujarat. Out of 29 states, Gujarat ranks 13th in poverty and 21st in education, with nearly 45 percent of its children under five underweight and 23 percent under-nourished.((https://en.wikipedia.org/wiki/Narendra_Modi#Development_debate)) And India, with 17.5 percent of the world’s population, is home to more than 20 percent of the world’s poorest people.((https://en.wikipedia.org/wiki/Poverty_in_India))
Despite this mixed record, the establishment of the Center at Columbia University indicates how “Modi-nomics”, or some other set of economic and trade reforms, might be advanced. With the goals of informing policy, delivering increasing prosperity and defining India’s role in the global economy, the work that the Center will undertake is an attempt to shape how the most powerful interests in the economy understand India today. Its research will be taken seriously by international institutions like the World Bank and the United Nations, its staff will be consulted on major domestic and foreign policy decisions, and its analysis will inform and shape public opinion on these matters. This is not a cultural project, but an economic one to influence and encourage resources towards the development of, for example, “smart cities” that will displace communities, disrupt livelihoods and demand security and surveillance mechanisms that can only foment existing tensions.
[aesop_image img=”https://kairoscenter.org/wp-content/uploads/2015/11/Actual_aerial_view_of_completed_developments_at_Palava_today.jpg” credit=”Palava City via Wikimedia Commons” alt=”Modinomics” align=”center” lightbox=”on” caption=”Aerial view of Palava City, a Smart City development project in the Mumbai area” captionposition=”left”]
This is not, to be clear, the direct use of remittances, but this Center is poised to leverage the economic, financial, cultural, political and intellectual resources of the broader diaspora community for global capital interests.((While local actors and individuals may personally benefit from this web of relationships, it is ultimately the interests of global capital that they serve. If it wasn’t Modi, it would have been someone else willing to play this role. If it wasn’t the BJP, it would have been the Congress Party or another political party organized to serve these interests.)) As Urban Development Minister Mr. Naidu said earlier this year, “Both national and international investors are looking for opportunities in the backdrop of the recent financial crisis…people are searching for safe investments. I offer smart cities as the safest investment because land is going to be there, structures are going to be there, so the returns are assured.”((Mehboob Jelani, “Centre unveils list of 98 smart cities,” The Hindu, August 28, 2015
https://www.thehindu.com/news/national/centre-releases-list-of-98-cities-for-smart-city-project/article7586751.ece.)) Global capital not only owns and controls the vast majority of the wealth and resources of the world, it has every influential institution – as well as individuals and institutions that seek to be influential – working for it as well.
This is what it means to control the economy: less than a comfortable or even luxurious income, steady job, or pension plan, it means that you can dictate what happens, where, on what terms and with whom, for however long you are interested. And global capital cannot, for the time being, lose. Meanwhile, millions are being displaced, made superfluous and excluded from the economy. Governments are becoming less accountable to their people; human rights are being thinned out to “goals;” and we rage on in a world where the poor are pit against the poor, fighting over scraps in the most productive economy in human history.
This is what we are up against: a force that is highly mobile, flexible and adept at using existing institutions and individual hubris, with no accountability to the disaster it must necessarily create to exist. But it is also arrogant, short-sighted and itself divided, in competition with the legacies of nationally-based interests that are fighting for their own legitimacy and survival. It has weaknesses and vulnerabilities that we must understand as part of the long struggle to end poverty today. Even more importantly, it does not have the answers to the global social crisis that is unfolding. For these, we must turn instead to those who are fighting for a place and home in this world and who are turning to each other in the midst of this crisis. This is where a new society is being born.