Public works for building permanent assets such as infrastructure are a necessary stimulus for an underperforming economy because what is needed then are more investments and not an increase in consumption, even if this leads to some deficit financing. It must be realized that much of such deficit will be covered by the valuable assets so created. However, even consumption may be encouraged, though not as a substitute for investment, because spending for consumption is also, a two sided transaction and increases incomes all around. The predominant issue is to spend / invest the money, not to leave it idle in savings or invest in unproductive assets. (See “Money & Financial “Boom & Bust”cycles-an inevitable outcome”.)

As J.M. Keynes recommended – “The Investment in public works (infrastructure) should be viewed as part of a ‘Capital’ Budget and not as part of the ‘Ordinary’ Budget, thus avoiding the confusion between the fundamental idea of a Capital budget from the rather desperate expedient of deficit financing”.

In order to encourage entrepreneurship in more of our population and to encourage many others to become owners of ‘New Wealth’ in the form of equity / shares in a growing market and thus lose their fixation for only Land or Mineral / Water resources, it is recommended that the government provide an incentive, to the poor and especially also, to the girl child of a poor family in the form of allotment or allocation of shares in Financial Institutions which are investors in the Infrastructure companies (See-‘Girl Child – Protecting & Improving her lot while also, encouraging Infrastructure Projects’ and “Agricultural Reforms – Krishi Jagruthi Scheme”).

Serious consideration needs to be given also, to monetizing the assets that are presently unproductive and even continuously draining resources, i.e. the ‘Sick’ Public sector units, both Central and State and other idle assets such as land along the Railways etc. Part of such monetized resources can be routed into the equity markets, again through properly regulated Financial Institutional Funds in which the poor can be granted a shareholding, (See-‘Garibi Hatao- a Practical and Actionable way’). The cries of the Unionized Labour in such ‘Sick’ undertakings seeking to compare themselves with the prospective investors and therefore claiming to be victims and hence, preventing such monetization, should be shown for what they really are, ‘Dogs in the Manger’ who for their own benefit sit on the assets and deny the really poor jobs and opportunities. Labour laws need to be more practical and perhaps applicable only for large enterprises.

The infusion of such long term Capital into the financial market would encourage funding for long term Infrastructure Projects and also, greatly encourage Entrepreneurship, leading to greater Wealth creation for all. After all sharing of wealth is possible only after it is first created. Wealth creators thus deserve the opportunity and recognition as they benefit us all.

Conclusion

Wealth historically accrues from tangible resources but today it also, accrues more from intangible resources, mainly as equity in corporations working in the digital, Artificial Intelligence and Genomic areas. To share in the growth of such wealth it is essential that everyone be encouraged to participate in the equity markets, even if only through properly structured Financial Institutions or Mutual Funds. Entrepreneurs generating such wealth should be encouraged and allowed to benefit from their efforts, after all only when wealth is generated can it be shared.

JAI JAWAN!- JAI KISAN! – JAI UDYOGAN!

– JAI BHARAT! -JAI HIND! –

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