How to become a Billionaire in India and China? From the China of Mao Zedong to Xi Jinping’s and from India of Mahatma Gandhi to Narendra Modi’s, know how the riches have been made richer and poor have been left in more poverty. A rare insight on “How Millionaires have become Billionaires in India and China while the poor are struggling. EurAsian Times looks at an article by NZstuff.
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During the former Chairman of the Communist Party of China, Mao Zedong, power was used ruthlessly to impose the communist ideal of perfect equality. It was a poor country, and the poverty was shared pretty fairly.
Today in Xi Jinping’s China, power is used ruthlessly to stoke growth amid a system of gross inequality comparable to that of American capitalism, red in tooth and claw. To get rich is glorious.
In the India of the Mahatma Gandhi dynasty, there was an abrupt divide between the rich and the poor, and power was used as a veto to prevent any of the poor from becoming rich. It was a poor country, and the rich told the poor it was their destiny to take it that way.
Today in Narendra Modi’s India, power is used haltingly to stoke growth by enabling the burgeoning of billionaires, while everyone else is invited to see what they can find in the choking smog that is as much a hallmark of Delhi now as it is of Beijing.
The rise of India’s new urban prosperous class amid the slums was described as “islands of California in a sea of sub-Saharan Africa”, in the words of Jean Dreze and Amartya Sen. The emblem of this phenomenon is the home of India’s richest man, Mukesh Ambani, estimated wealth US$49 billion ($74.2 billion). His 160-metre-high vertical mansion towers over Mumbai dubbed the world’s first billion-dollar home.
In his new book, Crabtree calls it a “gated community in the sky”, where Ambani parks his luxury car collection in his six-level car park, greets guests in a grand ballroom so dense with ornate lighting that it’s said even the chandeliers have chandeliers and then whisks them skyward in lifts filled with flutters of live butterflies.
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After Russia’s infamous oligarchs, India’s billionaires are the second-most disproportionately wealthy in the world as a proportion of national output, the Bollygarchs challenging the oligarchs for the title of the most obscenely rich of the global super-rich.
A century ago, Gandhi told young Indians: “Western nations are groaning today under the heel of the monster god materialism. Many of our countrymen say that we will gain American wealth but avoid its methods. I venture to suggest that such an attempt if it were made, is foredoomed to failure.”
The good news is India is growing steadily more materially wealthy, and the billionaires have lifted more than 100 million of their countrymen out of poverty with them. The bad news is India is following pretty closely the American model of Gilded Age excess and inequality – and the corruption that goes with it.
You can locate exactly how far India has come in catching up to the United States economically by using GDP per person. At USD 5200, adjusted for the cost of living, India today is where America was in 1881, the height of the Gilded Age, according to Crabtree.
Crabtree has invented a name for the Indian construct. He sequences India’s modern history as a territory of the plundering British Raj, then under independence making itself into the socialist bureaucracy of the Licence Raj, before developing over the quarter-century of economic liberalisation into the Billionaire Raj. This is the title of Crabtree’s absorbing book, The Billionaire Raj: A Journey Through India’s New Gilded Age.
In a measure that stretches through all three reigns, the share of India’s income taken by the top 1% is now at its greatest since tax records began in 1922, according to the economist Thomas Piketty.
The deregulation of the licence raj unleashed not just a concentration of economic power but also a concentration of India’s notorious graft, which went from a system of retail corruption to a wholesale one, in Crabtree’s words.
And what is PM Modi, sometimes described as India’s first conservative leader, doing at the head of all this? As his first five-year term advances its end, all hints are the popular strongman will be re-elected at next year’s poll. He promised to take national his success in kick-starting growth in Gujarat, and he has pretty much performed. India is now growing faster than China and it shows every sign of continuing to do so.
As the OECD projected in its recent report The Long View: Scenarios for the World Economy to 2060: “China’s share of world output peaks during the 2030s at about 27 per cent and declines slowly thereafter, while India’s share keeps rising.” And where China becomes the world’s fastest-ageing society in the next generation, India’s youthful demographic is a force for keeping it thriving and thrusting.
It has embraced the world economy with a more open economy than China’s and it is more deeply entrenched in globalisation than either China or America. And it suffers no backlash against open markets and free trade. Indeed, four out of five Indians endorse globalisation as a good thing.
The country’s long history as a trading nation means Indians are “instinctive internationalists” as Crabtree puts it. Globalisation is a force for growth. So it brings technological progress and market-based reform. India has some of all these and is gathering pace in all.
But these are also forces for inequality. Modi has had less success in some of his programs for improving equality. Operating in a democracy is complex and Modi does not control India’s upper house nor its powerful civil society forces or its independent institutions.
Crabtree writes that while PM Modi’s critics accuse him of excessive use of state power, “it was amateurism rather than authoritarianism that appeared to be the greater threat to India’s future”.
But as the conversion of China and India from communism and socialism to rampant capitalism and billionaireism shows, change is possible. Fairer societies and greater equality are a matter for a country’s domestic systems. They are possible.