“Generations to come will scarce believe that such a man as this ever in flesh and blood walked upon this earth.”
Einstein on Gandhi
While celebrating the 150th anniversary of Mahatma Gandhi, it would be appropriate to reflect on some of his thoughts and their relevance in modern times. There are two major issues impacting the world today that are being seriously discussed across the globe: One is the economic problem of rising inequalities in the distribution of income and wealth and the other is the ecological problem of climate change. It is interesting to note that Gandhiji had profound thoughts on these two issues. In fact, he was far ahead of times.
Rising inequality in wealth and income is a fact of our times. This is largely due to change in the nature of wealth. There was a time when cattle were the symbol of wealth. With urbanization, when land prices rose in urban areas, land became wealth. With the bull-run in gold following President Nixon’s proclamation in 1971 withdrawing dollar’s convertibility into gold, the yellow metal became a symbol of wealth. But, in the modern world of entrepreneurs creating wealth through the stock market, wealth means the value of stocks or market capitalization. The vast majority of the super-rich of the world is wealthy thanks to the market value of the stocks they hold.
The stock market provides the mechanism by which this huge wealth can be democratized and well distributed. While visionary entrepreneurs create wealth through the stock market, ordinary people can participate in this wealth by investing in the stocks of these great companies. Millions of ordinary shareholders of great companies have become wealthy just by investing in stocks. While the market makes millions for entrepreneurs, millions of ordinary people benefit out of this wealth creation.
In fact, the stock market can be seen as the application of the Gandhian idea of Trusteeship. According to Gandhiji, businessmen are the trustees of wealth. To quote Gandhiji, "Supposing I have come by a fair amount of wealth – either by way of legacy, or by means of trade and industry – I must know that all that wealth does not belong to me; what belongs to me is the right to an honourable livelihood by millions of others. The rest of my wealth belongs to the community and must be used for the welfare of the community." Public ownership of stocks, either directly or through mutual funds is the application of Gandhian concept of Trusteeship.
Global warming and climate change are existential issues of our time. Greta Thunberg has become a world celebrity thanks to her crusade against climate change. It is a fact that unbridled consumerism and the consequent plunder of nature’s finite resources are causing global warming and climate change. Infinite demand on the Earth’s finite resources is unsustainable. Gandhiji foresaw this disaster and suggested a simple solution. He said, “Earth provides everything for everyman’s need; but not for every man’s greed.” In other words,” live simply so that others may simply live.” Let’s remember these great words of wisdom of the father of the nation on the occasion of his 150th birthday.
The author is Chief Investment Strategist, Geojit Financial Services