Sri Lanka: Dr N.M. Legacy — Time to Reiterate

Cooperatives must be revived in the agricultural and consumer sectors as we re-introduce collective action to go along with individual entrepreneurship to develop our economy.

by Tissa Vitarana- Aug 12, 2018

( August 12, 2018, Colombo, Sri Lanka Guardian) Commemoration of Dr. N.M. Perera’s 39th Death Anniversary, along with the historic Great Hartal of August 12, 1953, will take place at 3pm on Tuesday August 14 at the Public Library Auditorium, Colombo. Speakers will include political leaders of the Centre/Left – Dinesh Gunawardena (MEP), Tissa Vitarana (LSSP), DEW Gunasekera (SLCP), GL Pieris (SLPP), Vasudeva Nanayakkara (DLF), Asanka Navaratne (SLMP), D Kalansuriya (DVJP), and Trade Union leaders WH Piyadasa and AK Namasivayam. Rev. Baddegama Samitha will chair the meeting.

Dr. N M Perera obtained a B.SC(Economics), Ph. D and D.Sc from the London School of Economics where he was a favourite pupil of Prof. Harold Laski, the Economic Advisor to the UK Labour Party. He rounded up his political and economic knowledge through an extensive study of the works of Marx, Engels, Lenin and Trotsky.As both a socialist internationalist and nationalist, his life was devoted to the fight against Imperialist exploitation and aggression in all its forms. As the leader of the Lanka Sama Samaja Party (LSSP) he fought for all against poverty and social injustice and to derive the full benefit of the advances of Science, Technology and Innovation.

His main achievements are being lost – Modern Imperialism is systematically and covertly destroying past gains and future prospects by the global Neoliberal project of the USA and its agents, the IMF, World Bank, CIA and “think tanks”. They are operating through puppet regimes, established democratically (UNP in Sri Lanka) or autocratically (Thailand). With the global economic downturn affecting the West more than the East, more direct, but covert, exploitation of our countries is being resorted to, weakening our state and Government, while strengthening market forces controlled by the USA and its allies (MNCs etc), misusing the UN.

1. Complete Independence: for which NM suffered in British jails. He helped Colvin draft the 1972 Republican Constitution. Sri Lanka is now in the USAs military network e.g. Trinco base.

2. Sovereignty: NM helped establish the Economic G23 to fight against unequal terms of trade; this later led to the formation of the G77 of NAM leaders of independent sovereign states. He attempted, along with Colvin R de Silva, to establish a cartel of tea and rubber producing countries to get a proper price, (like OPEC for oil). To emerge from a British dominated economy based on the sale of raw materials with profits going abroad, NM supported the nationalization of the commanding heights of the economy and strengthening the state sector, with active workers councils. He promoted self-sufficiency in food and import substitution industry. But FDI/LDI was also effectively promoted. A national social welfare economy to serve all Sri Lanka’s people was developed. Value added industry by developing our human resources and STI were funded. He reduced the foreign trade gap, increased our foreign reserves, minimizing debt andbalanced the Budget. Present UNP/SLFP Government has increased Sri Lanka’s national debt to the point of bankruptcy, widened the trade gap, become more dependent on imports and loans, weakened the Rupee – from Rs 8 then to Rs 160 per dollar now. National Assets are being sold to foreigners; and the Welfare State dismantled.

3. Parliament: NM made it a respected institution with strong democratic traditions reflecting the will of the people. He opposed the grafting of the Executive Presidency and making large District based constituencies. LSSP stands for a mixed electoral system on the German model. In his booklet “A Critical Analysis of the 1978 Constitution” NM warned of the inevitable conflicts that would arise between the Executive, the Legislature and the Judiciary; the instability of Parliament and the emergence of dictatorial tendencies that would undermine the sovereignty of the People and of Parliament. The UNP undemocratically imposed the dictatorial Executive Presidency, the large electorates and the hated “Manapa electoral system”, that has split parties and the Government itself. The present UNP-led Government has reduced Parliament to an undemocratic farce, without having a proper Opposition (Joint Opposition ignored with 70 members out of 92), a highly biased Speaker, responding to serious criticism of Government’s misdeeds and blatant corruption by making a joke of it with the PM playing the role of clown.

4.Governance: NM as the Cabinet Minister of Finance and MP was the epitome of good governance. He was free of corruption, and never guilty of political interference or nepotism. He stood for appointments and promotions based on merit first, making allowance for poverty based disadvantages second. He respected good administrators while being opposed to bureaucracy itself. Serving the people was his priority. The present UNP-led Government is the most corrupt and incompetent one in our history without any sense of honour or desire to respect the truth or keep to its promises. With open conflict within the Government and Cabinet political and economic Instability has resulted. Government’s harsh attitude towards officials, employees and the people has alienated all of them, leading to non-cooperation.

5.National Unity: NM sacrificed his political future (being PM) by standing up for Tamil also as an official language and against the UNP disenfranchising the people of recent Indian origin. He fought against discrimination based on race, religion, caste, gender and class. NM was a true statesman committed to national unity to build one Sri Lankan Nation of equals. The present UNP-led Government had a golden opportunity to achieve this, but seems to have missed it. To divert the people’s attention from its failures the “divide and rule” policy of promoting racial and religious discord is emerging. The trend is social and political chaos with conflict promotion.

6.Tax Policy: NM raised the maximum direct taxation to 70% so that the super-rich were the main source of funds to balance the Budget. But by giving tax concessions to local investors he promoted development. By minimizing Indirect taxes, specially on essentials, and low priced goods on the ration through an efficient cooperative system, the burden on the people was minimized, and inflation kept low. With the global food crisis no one died here unlike in other countries. By demonetizing, he brought out black money strengthening the economy. The stable political and economic environment maximized FDI (Levers, Nestle etc. came here). The UNP Government has extracted 85% as indirect taxes, burdening the people, and only 15% as direct taxes at the very low maximum rate of 24% (in Europe it is 45%) so that the very rich have it good, and the rich/poor gap is widened leading to social instability and more crime. The import of luxury goods increases the foreign trade imbalance and debt, also devaluing the Rupee and adding to inflation. The unstable economic climate has reduced FDI based development.

7. National Welfare Economy with greater equity: NM stood for a National Welfare State and supported the complete dismantling of the British Colonial Economy through nationalization of their major Banks, Insurance, Ports. Plantations, Mineral resources and by bringing all Utilities into Public hands – Railways. Roads, Transport, Power, Water, Import and distribution of fuel and other essentials. He fought for a Welfare Society that empowered people based on cooperation, and the Rights of the working people and the disadvantaged. Distilleries and private land over the limit of 50 acres were nationalized and distributed among the landless, while also establishing State plantations. Based on a National Plan he promoted the development of value added industry utilizing our natural, agricultural and human resources. He gave the highest allocations for Science, Technology and Innovation (0.4% of GDP) to develop local Industries, and promoted Developmental Banking. NM gave maximal support for Free Education, Free Health (Including the implementation of the Senaka Bibile Medicinal Drug Policy making all essential drugs available free in the State hospitals). At the behest of the USA and IMF, the Neoliberal Project to make Sri Lanka a neo-colony, is being meticulously planned and executed. The present UNP-led Government is dismantling the Welfare State and selling all national assets (land, ports, utilities like the Water Resources Board and even State Departments like Survey) to foreigners (MNCs etc) who are getting control of our economy. Individual gain, by hook or by crook, supersedes collective good.

Conclusion: NM was a pragmatist and would have shifted his policies to accord with the process of Globalization, but without giving into the Neoliberal Asenda of USA led Imperialism. He was always ready to develop the economy using the capitalist system under Government regulation, without surrendering to MNC led market forces. He would have seen the progress made by China and Vietnam and opted to adapt the East Asian model of development to suit our needs. But rather than giving into the forces of individual profit alone he would have preserved the welfare state and the dominance and regulatory role of the Government. But in a Centre/LeftGovernment the negative impact of petty political interference with appointments and decisions would require change, together with bureaucratic obstruction, lethargy and corruption.

I am sure he would have supported the “solidarity concept” being adapted to overcoming these problems as suggested by me and colleagues from the LSSP. While giving full support for private capitalist and state enterprise based development, the solidarity model of ownership would have appealed to him. In this model enterprise ownership is shared equally among all employees, from top professional management down to the most unskilled worker. A Council of Management is elected by secret ballot and all selections and promotions are based on merit. The profits are shared equally while the differential salary structure is observed.

This has worked well in UK, USA, Spain (Mondragon Province that produces 13% of the GDP) and in a Kerala tea plantation. Why not here?

Cooperatives must be revived in the agricultural and consumer sectors as we re-introduce collective action to go along with individual entrepreneurship to develop our economy. Development Banking (Venture Capital) support is vital. for development. Sri Lanka must discard the Neoliberal project of the USA and IMF and return to a truly national development model adapting what Dr. N. M. Prera started to the modern world to suit the needs of all Sri Lankans.