Re: Swami Ankaleswar Aiyar's response

["Mr. Henry Thiagaraj" <hremi@vsnl.com>]

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Friends:
1.One year ago I mentioned as every Indian village is divided into a caste
village and Dalit village and the benefits which reach poor Caste people donot
reach poor Dalits, poverty continues to haunt us! Until segregation in housing
is removed at grassroots community life in rural area poverty eradication has
little chance.
2. The book: INCOME POVERTY AND BEYOND - Human Development in India  edited by
Raja J. Chelliah and R Sudarshan, published by SOCIAL SCIENCE PRESS, New Delhi
(1999) for UNDP has some interesting and valuable observations which may be
useful to your debate!
3. The British Govt. through its DFID has earmarked British Pounds 27 million
for poverty eradication for the next 7 years in India and is looking for
management agent - a briefing will be held at Delhi on 19th May. Some of you
may attend and help UK Govt. to use the money wisely!
Henry Thiagaraj
Dalit Liberation Education Trust


Dr. Sanjeev Sabhlok wrote:

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> Please help make the Manifesto better, or accept it, and propagate it!
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> Thought I'd share this response [extracts]. We should all think very
> seriously, together, on this subject. I hope Mr. Aiyar won't mind since the
> topic is of tremendous importance. I'll get back on Mr. Aiyar's response
> later. SS
> =-=--=
>
> Dear Dr Sabhlok,
>       Your scheme for a negative income tax to tackle poverty, and the pros
> and cons you have discussed with Pronob Sen of the Planning Commission,
> need to be converted into an article for publication in the Economic Times.
> Why don't you give it a try?
>       I have gone into these issues in the past myself. Ideally, every
> Indian should have a personal identification number (like the social
> security number in the USA) which has to be mentioned forall important
> purposes like voter registration, driving and other licences, taxes, bank
> accounts and the like. That creates a  system that can  keep track of the
> poor and discoiver leakages and fraud. It is an enormous administrative
> undertaking, and fraud is rampant even in the US. Of course, the leakages
> are surely higher in various subsidy schemes in India, where the non-poor
> probably get 80 per cent of all benefits.
>    The second non-trivial issue is that poor people get money today from
> relatives and extended social groups (like the biradari). Once the centre
> steps in, these private transfers to the poor will dry up. Some research
> suggests that private transfers can be quite appreciable. I would hate to
> destroy private forms of distress alleviation and substitute it by a leaky
> bureaucratic effort.
>
>       There is a simpler alternative. Every gram panchayat can be give
> given a cash allowance for relief to the five poorest families. There will
> have to be open discussion at a gram sabha on who are the most worthy
> beneficiaries. This was indeed tried in the old Antodaya scheme. It's less
> ambitous than you negative income tax scheme but much easier to implement.
> It will reach people who cannot participate in rural employment programs
> (the aged, very young, sick and crippled). I suspect this might alleviate
> half the existing poverty without totally destroying private transfer
> mechanisms.
>  The real problem in focusing subsidies on the poor in democracy.
> Democracies are majoritarian, not egalitarian. A subsidy that reaches only
> the bottom 30per cent will have less popular appeal than a subsidy which
> reaches 70 per cent of a targeted section of the populationlike farmers or
> urban dwellers.. What economists call "leakage to the non-poor" is not
> leakage at all from the politician's viewpoint,  but accurate targeting!
>
> With best wishes,
> Swami Aiyar
>
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> This is the National Debate on System Reform.       debate@indiapolicy.org
> Rules, Procedures, Archives:            ../debate/
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This is the National Debate on System Reform.       debate@indiapolicy.org
Rules, Procedures, Archives:            ../debate/
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