Tax the Rich, Says Nobel Laureate Joseph Stiglitz for India

In a webinar conducted by Federation of Indian Chambers of Commerce & Industry's (FICCI) West Bengal state council, Nobel Prize-winning economist Joseph Stiglitz shed light on the pitfalls of India's response to COVID-19. The session was chaired by the council's chairman Rudra Chatterjee and attended by Indian businesspersons and economists.

Tagging India 'a poster child of what not to do', Stiglitz noted that though a lockdown is an important step to combat the pandemic, it lacked planning for a country as poor as India. "How are people going to live, a large number of people moving across the country. One could not have imagined anything worse for spreading the disease," he said, as quoted by Huffingtonpost.

Stiglitz opined that India must start printing currency immediately to combat bankruptcy. The World Bank, in its report released in Washington on Thursday, said that India's GDP is expected to contract by 9.6%. Stiglitz also suggested that money be used judiciously for the vulnerable sections of the population and control of the contagion. "Let me say very clearly, you cannot control the economic aftermath if you cannot control the pandemic," Stiglitz said as quoted by The Telegraph. Currently, India ranks second in the number of patients tested positive for COVID-19 preceded only by the United States.

"If you can't get resources, one way of dealing with it is, raise taxes on the very rich. You have a lot of billionaires in India -and if you spend that money well, it actually stimulates the economy," he argued.

He also negated the PM's call for self-reliance by noting that in contemporary times, no country can be completely self-reliant given that raw materials and technology are often imported. He also alleged that the PM was engaging in divisive politics while the need of the hour is 'politics of solidarity' and 'tolerance' has been the key to India's economic success. Suggesting measures for India to survive in the post-pandemic world, he said, "I will start by trying to create an inclusive society. Politics of division is an antithesis of what needs to be done. Modi has tried to divide your country, Muslims against Hindus, and that is going to undermine your society and economy no matter what else happens. This fundamental division will weaken India forever."

Stiglitz, a professor of Columbia University also served as the chief economist at the World Bank from 1997-2000. He was awarded the Nobel Prize for Economics in 2001.