Yesterday once more!

Apart from being political adventurism, demonetisation and the subsequent withdrawal of two thousand rupee notes is also about abject narrow mindedness and short-sightedness of a class of citizens who are unwilling to play their democratic roles. This class does not seem to realise that their disregard for systems based approach towards understanding problems and finding solutions transforms their so-called empathy into apathy.

I vividly remember that day when a friend called up to tell that 500 and 1000 rupee notes would no longer be valid anymore. I thought it was a joke, yet I asked, “Since when?”

“…from this very moment onwards! The PM announced it live on television.”

I was like, “Give me a break!”

It was something unbelievable and the friend was in no mood for jokes so I checked the news and to my utter surprise, something unbelievable had just happened. What followed was utter chaos, disrupting lives all across the nation. There were long queues at banks and ATMs. People in urgent need of money for medical expenses or family events like marriages were running from pillar to post, trying to organise the much needed cash. And yet there were people justifying the act of demonetisation.

The series of contradictory rules and regulations clearly suggested that the action was not only ill-conceived, but ill-planned as well. Contradictory to the claims of the government, access to cash depended on one’s proximity to economic power centres. It was proven once again that the national capital region and big cities are the preferred children of our nation.

Badly stuck in this quagmire were people who did not have any operational bank accounts. Some of them had PO accounts but their post offices were not in a state to provide any assistance. The government machinery, like time and again, conveniently ignored the poor. They still find it hard to understand that a poor daily wager from a village, who earns 500 for a day’s labour, has to spend around 300 rupees to access banking services on a given day. This also means letting go of the daily wages hence the net expense to access banking services goes up to 800 rupees. Due to access issues, banking is not a viable option for many. And banks too are unwilling to provide them any access. Majority of the banks setup their mandatory ‘rural’ branches in the vicinity of the cities – in neighbourhoods awaiting inclusion into the city limits.

Meanwhile, the rich in the city adversely affected by demonetisation had begun using the urban poor as money changing mules. The ‘black’ market for conversion was also up and running in a matter of few days. The act designed to eradicate black money had started generating black money. I remember hearing about people who offered 900 rupees in lieu of a 1000 rupee note.

Even if we assume that only 10% of the total currency of 360,000 crore was in black then this 10%, which the target was, should have become worthless due to demonetisation. But this 10% was with influential people, who obviously deployed various means to ensure easily conversion. Even if we assume that they paid a commission of 0.5% for this conversion, imagine the amount of black money that got generated in the process of its eradication!

Pro-demonetisation folks animatedly talked about black money coming back into circulation due to this action. They ignored the fact that even if only 1% of India did not have a bank account, these 1% people ‘saved’ money in cash – usually in notes of higher denomination. The act of demonetisation brought out this ‘saved’ money. A significant contribution to this ‘recovery’ would have been the cash women saved for the rainy days and personal expenses. All of this probably got labelled as black money which was brought back into circulation through a masterstroke.

Another ill-conceived decision was the introduction of a currency note of even higher denomination. The 2000 rupee note not only made stashing or transportation of cash easier, it also made the business of counterfeiting more lucrative. These may be the probable causes why the 2000 rupee note stands withdrawal, though not via a masterstroke.

The usability issues came into the fore probably because the new currency was designed in a hurry, with utter disregard for design and system compliance. The randomly sized notes, and the coins that followed, adversely impacted the usability of the currency. It was probably assumed that colour was the single biggest differentiator between any two denominations.

All the above mentioned facts seem to be pretty obvious. The outcome was there for everyone to see. Yet, the masses happily consumed the story that the said action badly affected the rich. Belief that the rich folks were in trouble, made everyone else happy. Here, the term ‘rich’ means people in higher slabs of economic hierarchy with respect to the opinion holder. The same story was shared with me by some young adults in a village. They believed that the action was right. Though they also acknowledged that the system failed to anticipate how the masterstroke is going to adversely affect the lives of the poor. The daily wagers, especially in construction work were impacted badly. These kids experienced the impact in their own households.

In order to take the conversation further, I asked, “What is black money?” Almost all of them said that it was money earned through corrupt means, like bribes. I asked them why the money that daily wagers earn was not black money especially when it was largely unaccounted, and many a times given by businessmen who may have earned the money through wrongful means. Children felt that money earned by daily wagers cannot be black because it is hard earned. Even if unaccounted, it is earned through blood and sweat. The source does not really matter.

This query was followed by a question with regards to the blackness of money earned through sale of Hashish. Hashish is produced and sold across numerous villages in the Himalayas. Many a times the entire family, including small children, participate in its production.

Most of the children replied that the money earned through sale of Hashish was black because it was earned by doing something which is legally forbidden. This led us to the next query – Will demonetisation stop hashish production?

Their answer was in negative.

So what was going to stop the production of Hashish? They had no answer. But they understood that it is not the money but the economy that is black. To eradicate black money one will have to attack the economy that produces it, and not the other way round. The conversation then went on towards what is money, what it trade, how is money minted, and so on.

The reason I tell this story here is that young adults from underprivileged sections of rural India could easily decipher what the educated well-to-do classes find hard to understand. They ignore the fact that rules and regulations are for well-meaning citizens and not for those who wait for every opportunity to circumvent them.

The privileged classes casually talk about going to an ATM to withdraw money, or usage of digital means, without realising that a large section of our society does not earn enough to maintain the minimum balance needed for the bank accounts. We have banks like SBI which change the minimum balance requirements without even intimating the customers. I have personally faced the situation wherein SBI forcibly deducted fine from my account as I did not maintain the minimum balance, which I was not aware of.

Our elderly, though well educated, find it hard to use plastic money and other digital means. No wonder crores of rupees gets looted everyday through phishing and other such cyber crimes. This menace is powered by the fintech start-ups who know very well that they are part of this chain yet do nothing about it. In fact they are monetising from the crime.

The privileged visions are blurred because they do not even peep out of their window; forget getting into the streets to understand the real needs of real India. They want to eradicate black money yet happily use it as convenience charges. They want privilege at every step of their lives and yet talk about equity and fraternity. The sad fact is that the privileged educated class of India finds it hard to understand the complex relationships that govern our complex social and economic structures. They find it hard to fathom the extent and scale of our diversity. They simply fail to see the system. It would not be an exaggeration to say that most of the educated and privileged class of India is binary.

I remember a big man once stated that a mobile phone in every hand would eradicate poverty. I wanted to believe that it was a misquoted statement. Much later in time I personally heard his friend and senior colleague, a well-known technocrat who is the brain behind some complex IT infrastructure of India, state with no hesitation that – with UPI even the poor in our villages can invest in mutual funds!

On hearing this I suddenly realised where the ill-conceived and ill-planned masterstrokes derive power from. Such lopsided views of classes which think that they know it all ensure that there is no serious scrutiny of ordinances and legislation. Whatever mess we were in, we are in, shall remain in, or will get into is plainly due to the narrow mindedness and short-sightedness of these classes which otherwise do seem to have the power and means to alter the destiny of this nation.

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