Aditya Kannan

Shower thought #2 – on economic imperialism — January 29, 2020

Shower thought #2 – on economic imperialism

The Bengal famine of 1943 was an event that reflected the true decay of the Indian state under British colonizer. In one of the most fertile regions of the Indian subcontinent, over three million people starved to death that year due to a series of ill conceived decisions made by the British war cabinet (headed by Winston Churchill) and government. The life expectancy of Indians, at the time, was thirty-one.

Churchill’s war cabinet scapegoated the ongoing conflict in Europe to justify levying extremely high taxes on Indians, forcing them to sell crops to the state for token prices. There was, of course, no regard for the fact that many regions in India at the time, including Bengal, were in desperate need of food. The sums of money the farmers received from their produce was essentially meaningless in a time where demand for goods was extremely high and supply was nearly non-existent.

Reading about this crisis urged me to consider the political state of our citizenry at the time. Leon Trotsky once appropriately said, “Revolution is impossible until it’s inevitable.” — but what could have made such an uprising viable in a country where foreign colonialist ideals penetrated the very deepest facet of its soul – the allegiance of its own people?

I don’t know what could have helped alter the predicament of my countrymen at the time. Was there a viable solution in hand?

It’s easily understood that the British occupancy of India highly depended on the revenue it collected from the people. To a large extent, their war effort during the World War 2 was supported both by Indian resources and labour. So in a time where even an organized armed revolution was deemed to be unviable by most, what could the people of India have done to undermine its imperialist overlords?

Well, I have — no, I had no idea.

The survival of tax dependent regimes like the British Raj deeply depended on the extraction and manipulation of money gathered from the colonies — exemplified by the fact that they charged taxes even on the very act of extracting salt. The workers and peasants paid taxes for the money they earned in the British Indian denomination. Essentially, they were supporting the very economic system that oppressed them by simply participating in it, and the widespread usage of the rupee, in essence, legitimized it.

(Fun fact: the salt tax — quite amazingly — still survives in a decidedly more Indian form: Salt Cess Act)

Could a concentrated effort have been created to upturn the very legitimacy and value of British rupee? What if an alternate, decentralized and standardized form of currency (think gold standard or something of the sort) was created to facilitate local trade and payments? What would happen if people… just simply stopped using the rupee?

Applying the solution to the scenario we considered earlier, a purely Indian currency could have – albeit not without extreme trouble – clandestinely enabled trade between goods suppliers and commoners to help them circumvent the financial hegemony possessed by the government with the British-Indian rupee.

The viability of an idea like such is certainly open for discussion. Here’s a few downsides I almost immediately arrived at:

  • A currency like this would obviously be subject to heavy crackdowns
  • How will conversion rates be decided? Will the prices of goods have to be defined from the get-go, or will a reserve bank of sorts have to be established to control prices?
  • This new type of money would have to confront the same problems as any other ordinary currency: forgery, duplication, and inflation. How will a currency like this be standardized?

Of course, it’s not too difficult to see a few upsides

  • As mentioned earlier, trade can proceed without the regulation of the government.
  • If the usage of this currency becomes widespread, it can induce a deficit in the government.
  • Symbols – both cultural and ideological ones – are extremely important to resistance movements. They can unite people and signify their defiance and self-sufficiency in the face of adversity – and I think a symbol in the form of currency, something subject to daily use, would be a perfect candidate.

I’m under no illusion that a concept of this nature should be, to an extent, quite unworkable in reality. It’s almost needless to say that I’m very interested in hearing counterarguments regardless, so do care to comment or contact me. I’m sure we’ll have a great discussion.

#1 — November 25, 2019