Ambedkar and Capitalism


Prof Anand Teltumbde’s two-part article, “Babasaheb Ambedkar and Neo-Liberal Economic Reforms” that appeared in the September 30 and October 7 issues of Janata were a necessary rebuttal to those who are fraudulently using Dr Babasaheb Ambedkar’s name and aura to promote an economic model which he despised. I would like to give here three additional statements by Dr Babasaheb Ambedkar in support of that article. In these statements, he explicitly denounces capitalist economy and supports socialist economy.


The first statement was made at an early stage of the Constitution making process. It was when the “Aims and Objectives Resolution” was taken up for debate on the floor of the Assembly on December 13, 1946.  Babasaheb made the following remark in his speech:


I do not understand how it could be possible for any future Government which believes in doing justice socially, economically and politically, unless its economy is a socialistic economy.


The second statement is a part of the excellent explanatory notes which he included as an appendix in his Memorandum submitted to the Constituent Asssembly in March 1947 and that was later published under the title of States and Minorities. One could say that this memorandum reflects the vision of India as Babasaheb saw it on the eve of independence. In the explanation of Article 2, Section 2, Clause 4, titled “Protection Against Violation of Fundamental Rights: Protection Against Economic Exploitation”, Babasaheb wrote,


Anyone who studies the working of the system of social economy based on private enterprise and pursuit of personal gain will realize how it undermines, if it does not actually violate, the last two premises on which Democracy rests. How many have to relinquish their constitutional rights in order to gain their living? How many have to subject themselves to be governed by private employers?  Ask those who are unemployed whether what are called Fundamental Rights are of any value to them. If a person who is unemployed is offered a choice between a job of some sort, with some sort of wages, with no fixed hours of labour and with an interdict on joining a union and the exercise of his right to freedom of speech, association, religion, etc., can there be any doubt as to what his choice will be. How can it be otherwise? The unemployed are thus compelled to relinquish their Fundamental Rights for the sake of securing the privilege to work and to subsist.


What about those who are employed? Constitutional Lawyers assume that the enactment of Fundamental Rights is enough to safeguard their liberty and that nothing more is called for. They argue that where the State refrains from intervention in private affairs—economic and social—the residue is liberty. What is necessary is to make the residue as large as possible and State intervention as small as possible. It is true that where the State refrains from intervention what remains is liberty. But this does not dispose of the matter. One more question remains to be answered. To whom and for whom is this liberty? Obviously this liberty is liberty to the landlords to increase rents, for capitalists to increase hours of work and reduce rate of wages. This must be so. It cannot be otherwise . . . In other words what is called liberty from the control of the State is another name for the dictatorship of the private employer.


Such an explicit criticism of capitalism is more than any ‘liberal’ would dare venture, let alone a ‘supporter of neo-liberalism’. It is worth noting that from Ambedkar’s perspective, a capitalist economy was an enemy of liberty and social justice. As far as he was concerned, the scheme of ‘State Socialism’ was by no means a dirigistic scheme to prepare the ground for Indian capitalists. It was necessary for Democracy itself.  Thus, one may rightly say that while his struggle was not for ‘bread alone’, it is clear that he recognised the impossibility of achieving human dignity and liberty without resolving the question of ‘bread’.


The need to reach a consensus on the Constitution may have led him to tone down his insistence on using the word ‘socialism’ explicitly until the Constitution was approved. But in May 1950, just months after the Constitution came into force, he made a telling statement during an informal interview with the famed author Mulk Raj Anand:


Indeed liberty so far seems to be the liberty of the landlord to increase rent. The capitalist always wants to reduce wages and increase hours of work. Capitalism is dictatorship of the private employer.”


Can there be stronger words with which one can denounce capitalism?

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