INDIAN BILLIONAIRES SHOULD SHARE THEIR WEALTH WITH THE SOCIETY !!!!
Warren Buffett and Bill Gates are coming to India this July to request our billionaires to give away a large part of their wealth in their lifetime. India now has the third largest number of billionaires. Forbes says that India has 69 billionaires worth collectively $280 billion. The fourth-richest man in the world is in India, with his wealth in India. Americans have founded a society based on compassionate capitalism, which encourages individual initiatives and the creation of wealth.
But with great wealth come great responsibilities, and most American billionaires give away a large part of their wealth to society during their lifetime. This was started in the era after the Robber Baron era, at the start of the 20th century, when Carnegie, Rockefeller, Ford and others set up their foundations and built universities, libraries, museums and generally enriched the quality of life and gave back to society what they earned from them. This has ensured that the harshness of a capitalistic society is blunted and becomes acceptable to ordinary citizens. Europe, on the other hand, still has a feudal attitude to wealth, and inheritance needed legal measures to prevent wealth accumulation through the generations.
Warren Buffett and Bill Gates are great examples of this culture. Both have promised to give away collectively $100 billion during their lifetime, leaving a small amount (relatively) for their children. They are now on a drive to get other billionaires give away a large part of their wealth to ensure that society does not look at high achievers with hatred and envy and accepts that an open capitalistic society is essential for economic growth and societal well being. In India, we have the example of the Tatas who lived their dreams, accumulated great wealth and gave it away, leaving their descendants ordinary mortals.
What has been the response of our home-grown billionaires who have seen great wealth, unimaginable in the socialistic era, come to them because of the policies of liberalisation and globalisation? A very substantial part of this wealth is because of the market value of their shareholding in their companies. This wealth is a direct result of an open economy that allows the rapid creation of wealth and a dynamic stock market that rewards enterprise.
Besides this, tax policies have played a major role. In 1992, wealth tax of 2% on market value of shares was abolished. Income tax was 50% at the maximum marginal rate in 1991, 40% in 1994 and is 30% today. Dividend is tax-exempt in the hands of the recipient if dividend distribution tax is paid by the company. All told, tax policies have had a large role to play in the accumulation and size of this wealth. So, a large part of this wealth is a direct result of tax policies that fostered a dynamic stock market and, of course, the enterprise and courage our billionaires showed in their business. They do deserve full credit for this and none should envy them their success.
What responsibility do our billionaires owe to society and the rest of their brethren? India is a poor country with ordinary people dying because of lack of elementary healthcare, 45% of our children in the age group below 5 years being malnourished, a child mortality of 45 per 1,000, and only 13.5% of our young people in the age group of 18-24 being in college, a country beset by problems of governance and poverty looking for succour after 60 years of freedom, almost a failed state for the vast majority of our people. Our billionaires have given back to society, schools, colleges, a university or two, hospitals, but nothing substantial in relation to their wealth save Azim Premji who has recently given away 8,500 crore.
Being beneficiaries of a poor country, they have a moral responsibility to give back the vast majority of their wealth to society. We are a society where we hold this to be true that wealth is given to a few to be held in trust and to be used for the betterment of society and not for oneself or one's children alone, where the power of wealth is reckoned to be the power to do good and not for personal enjoyment alone, where the maxim Sarve Jano Sukhino Bhuvantu is a guiding principle. If we take this aspect, we can conclude that our billionaires have not done enough to justify their wealth in terms of giving back to society directly or indirectly like the American billionaires have. Should we wait till they are advanced in age or ask for this now when we have so much of poverty and so much of inequality?
It would be a pity, in the land of Mahatma Gandhi, if Warren Buffett and Bill Gates have to come and persuade our billionaires to do their duty. India expects them to discharge the responsibility cast on them as leaders and do their bit. Even if they give away 2% of their wealth each year - 2% being the saving in wealth tax alone - it would amount to $5.6 billion, or 25,200 crore. What could this get us every year? Medical insurance of 2 lakh per family for 12 crore families (60 crore people), 100 universities at 250 crore each, with 10,000 students each, a midday meal programme for 20 crore children, job training for 2 crore youth at 10,000 each, the solution to the country's challenges! Do we have a right to make a claim? I would say, yes. And it is a small part of their wealth only, and that too because of beneficial tax policies.
Is it morally right for a few to enjoy such a disproportionate share of our national wealth? Yes, it is, provided they display the statesmanship to demonstrate their leadership in society and discharge their duty. They can wipe the tears from the eyes of the poorest of the poor