Mentors Comments:

• https://www.livemint.com/Opinion/aqq3rGFH6Ir81HsT5sZpiI/Opinion–Reforming-capitalism-for-human-welfare.html
• The article discusses the lack of concern shown by the philosophy of capitalism towards human welfare and evaluates the role of government in doing a balancing act between the interest of industrial class and the interest of the people. The question is important in today’s scenario where income inequalities, environmental degradation etc are major issues which are hardly given the attention they deserve.
• The question expects us to analyze the situation prevalent in society today and discuss whether the philosophy of capitalism and its inherent contradictions are responsible for the several issues with human welfare that we witness today. In the second part of the question, based on our opinion from the arguments made in the former section, we need to discuss the role of government in the present context.
• Introduction – Discuss the plethora of problem ranging from income inequality, environmental degradation etc that afflicts the world.
• This will be the structure of the main body:
  • In the beginning, lay down the facts which cause such a debate to arise. Present facts about the status quo such as the Oxfam studies related to inequality, the problems of crony capitalism etc. Highlight that the philosophy of capitalism is motivated by profits and there is an argument made that in pursuit of profits, everything goes. Highlight that according to several research the trust of citizens in the corporates is declining rapidly.
  • Thereafter, discuss the contradictions in capitalism as highlighted by thinkers like Mahatma Gandhi who said that if we continue living the way we do, nine Earths will be required.
  • Highlight the problem with views of scholars like Milton Friedman who stated that the role of business should be just business. Explain that other considerations should also be factored in.
  • Post that highlight the current role of government with respect to industrialists and businessmen and bring out how an ideal relationship should be
• Give your views and discuss the way forward in the conclusion.

Answer:

According to a global survey of citizens trust in institutions, it was reported that a continuing decline in citizens trust in capitalist corporations and democratic governments is visible. People suspect corporate power is swaying governments too much.

Corporates and industrialists work for their own interests only:

Crony capitalism has become a day to day phenomenon with many industrialists being accused of misusing public funds in recent times.

• Experience from medical treatments in the corporate hospitals show that the enormous costs people have to cater to the treatments there. Due to growing out of pocket expenditure millions of Indians have been pushed to poverty.
• Industrial growth has come at the cost of environmental degradation. Protests against Vedanta in Orissa are an example of this.
• Capitalist enterprises are designed to produce profits for their investors by improving efficiency and extracting economic surpluses from their operations. Their investors are their masters.

Instances of capitalists working for general welfare:

• In India, there is a growing realization that business cannot succeed in isolation and social progress is necessary for sustainable growth. An ideal Corporate social responsibility practice has both ethical and philosophical dimensions, particularly in India.
• Education, health and environment are prominently tackled by CSR initiatives in India. Project Hariyali and Project Nanhi Kali by Mahindra, Tata’s Act for Mahseer etc are some of the important initiatives by Indian companies.

Role of government vis a vis capitalist class:

• Dharma of institutions of democratic governance is to ensure fairness in society and equity among stakeholders. Indeed, it is the government’s responsibility to ensure that competition among capitalist institutions is fair and that large companies do not monopolize markets and leave room for small companies to grow. 
• Government must ensure that the smaller companies are insulated from the adverse effects of the dominance of giants in the market. 
• Nature and society must not be converted into money markets for the convenience of economists measurements, increasing GDP, and creating wealth for capitalists. Governments and business enterprises must work together to contribute to these qualities to win citizens trust.