The Kerala State Government is absolutely right to disregard FRBMA limits and raise its own funds for reconstruction. (1) We should further bring out how a new Government at the centre next year can then monetise the fiscal deficit not only of Kerala but of all States, akin to a debt jubilee. (2)
This is the way in other words to show in action the simple two part public financing approach not only to disaster management now and in the future but for health services, petty production, education and other needed social ecological and economic services in India in a time of runaway climate change. All of India is a disaster zone more or less and all States should be doing what Kerala Government is doing.
Raising the borrowing limit has been a key demand for many states as it constrains money creation in line with population growth and in line with the needs for education, housing, petty production and health services let alone electricity. Whether of not Narendra Modi is withholding permission for UN and other assistance is a red herring especially considering the international community is nothing but an alliance of imperialist and fascist dictatorships on the whole bar one or two countries. The international dimension should rather be seen in the wider context of fascist and liberal versus socialist political economy in the world at large, and the larger issue in India in this context of recommitting India to socialist public financing by in a first step booting out the BJP.
Considering the Narendra Modi Government itself has hidden 50’000 crore of fiscal deficit as per CAG report and itself has now reached 6.6% fiscal deficit (3) it does not seem politically relevant for Chief Minister of Kerala Pinarayi Vijayan to ask the saffron fascists for permission to go to 4.5% fiscal deficit. The all party meet in Kerala should give the requisite political backing enough for the increased public borrowing in the state as Chief Minister of Kerala Pinarayi Vijayan gets everyone together on August 30 2018.
Getting the people of Kerala behind a Rs 10’500 crore public sector borrowing for flood relief and rebuilding and replanting work should not be difficult as the experienced communists, -with experience in pushing against the inhuman limits of the liberal austerity politics of the BJP and the Congress party of Manmohan Singh before it, – can lead Kerala out of its problems as they have done before.
References
See various articles here https://countercurrents.org/author/anandi-sharan/
Anandi Sharan was born in Switzerland, lives in Bangalore and last year worked in Araria District Bihar, India. She works on trying to find the best money system to help people adapt to climate change especially in India.
