The Bhutanese currency lies on its belly as if some headache has really gotten worse. The King sleeps at its head, day and night trying to manoeuvre with his privileged education the course of relief into the system already infiltrated with parasitic organisms drenched in its blood exerting global and regional hegemony. But alas in vain!
What I have set out to do here is try to provide a more practical explanation to the changing Bhutanese economic plane rather than garland the King and the royal government with more accusations of torture and sabotage. Something that is so easy to be denied not just by the government but also by the people.
So I chose a different topic. Of course you might judge my perspective as that of an outsider: of a former refugee ever ready to criticise the regime. But face it, if you have the courage that there are certain general economic shifts which continue to occur in developing countries. These shifts have been researched and adequately affirmed as completely against the betterment of a society. So, these shifts require impartial explanation.
In fact the case of Bhutan provides further proof, of a rather convoluted kind, that what we presently see is nothing new.
Foreign Labour causing imbalance of trade?
Currently many news articles published on various news websites report the current economic problems of Bhutan. Some provide justifications for that as well. A current problem is the currency deficit. One of the explanations given to be the cause of the problem was foreign labour. Government official statements tell us that foreign labour takes away all the investment that Bhutan puts into its construction industry- hence an imbalance of trade is occurring. If this was correct then logically the state coffers are virtually empty. So, to speak the availability of Indian currency in Bhutan has been completely withdrawn.
But, how is it possible that the entire economy of Bhutan runs on foreign labour? Is the native professor who gets paid to teach at Royal Thimphu college foreign labour? Are the major businesses, the professions, the farms, hospitals and government sectors all run by foreign labour?
Is it just the lack of construction labour and/or crafts-persons, which is creating such a big imbalance in trade? Where are the thousands of Bhutanese citizens, whose labour creates value in the Bhutanese economy? Where? Who is to believe the news and to what extent?
If the facts provided by the articles on news websites are true enough, it is quite an irony to see a country which intends to be in complete balance with its entire social, ecological and political environment can neither balance its natural resources nor its labour to end up with an imbalanced economy. Yet envoys of the King buzz with happiness and sustainability principles wherever it goes. Empty talk without doubt!
It is important to say a few words on the Gross National Happiness before I move on to analyze the important economic issues.
Classification of the types of GNH
As a matter of fact Gross National Happiness (GNH) in Bhutan can be analogized to merely painkillers for the ones who consume it. For the others inside and outside Bhutan, it is an allergen of their environment. Neither can you ignore it nor can you withstand it. You sneeze in its presence and you feel anxious about its presence in its absence. The Chinese laugh but cordially out of politeness, the Indians acknowledge and grace your GNH ideas with the official smile allocated for a simpleton from rural India, people in the United States brag about your ideas at religious conferences, Australian parliamentarians crack a few jokes on the topic (what they do best) and the Buddha watches from his teachings, from the pages of holy texts, without happiness, fear, sadness or fervour. This is because the Buddha taught neither to gain nor to lose from anything. Pain is to be endured. Virtue is to be cultivated. Simply endeavour for knowledge and moksha. Or, what should be the happiest explanation to Buddha’s teachings, you tell?
So the question is can happiness, a truly abstract concept, an individual based feeling, be measured using a common national standard? What are the specific main types of happiness that will be measured, can someone from the government please elaborate? I am not talking about just one smile which will have to be categorized eventually. More prudently every context, every reason for a smile must be assigned a statistical value to be measured. Or else what is the point of GNH if it is just a feeling but cannot be averaged as the title gross suggests?
There is another alternative to GNH. After forty years since the former King Jigme Singye Wangchuk first pronounced his religious idea the alternative is to simply sack the idea. Simply talk about the debilitating economy of Bhutan in material and ecological terms!
So for the average subjects of the King who consume the idea of GNH, this well packaged drug is an all-in-one remedy for all their growing number of ailments. First of these being: spendthrift behaviour to the detriment of the Tsawa-sum– king, country and people. I can imagine at this moment GNH must be making its effect most felt. Perhaps the mantras of the monks can also print Indian currency!
GNH must be a source of great mental relief at this hard corner despite the fact that an economic disease continues to grow and thrive. Indeed, it is visible because no one seems to be unhappy at all. Look at fellow citizens happily obeying cuts on the supply of Gandhi paper. When a God king lives and rules from the head, the body withstands the bad and the worse. The debate in Bhutan about the economy and Gross National Happiness is too shallow and religious. The innocently uneducated cannot be blamed at all; it is the literate westernized folks who continue to overlook the decadence GNH perpetrates on every sensible economic debate.
Agrarian economy basically
As a semi-agrarian, semi-herdsmen and also partially-industrial nation, Bhutan will perhaps remain in agony. It may never experience a crash of its economy in the western sense, because a capital market directly linked with the global market is absent. People haven’t forgotten their farming skills and are most likely to be able to live off their backyards for food even if another ten financial crises ravage the planet. Of course the rich will still import! No doubt. They will have their means.
But on a factual note the state has a huge foreign debt of more than US$779.9 m (2009) – Nu 40 billion. This debt is paid from the revenue the state collects every year. Whatever remains is to be allocated for development in various sectors.
And anyone can be sure that international debtors will perhaps not let the state of Bhutan simply disappear without paying its debt. The dictator will have to remain in power in the eyes of international moneylenders. It has happened in other parts of the world and continues to happen on a regular basis. This is because the mechanism to collect revenue that is in place will be much less efficient under a republican democracy than what is currently prevalent under the monarchy. The oligarchs can simply pass any kind of law to collect any type of revenue to increase the coffers.
However, under a republican democracy truly elected parliamentarians will face a much harder time trying to reduce services available to the public than just fulfil loan repayments. This is because the public will be watching with eyes much wider when they do not have to fear. So, efficient collection of revenue in this context means most of it will be payed off against international debts.
In a more radical scenario a newly formed republic state may wish to simply renounce itself free from the debts based on principles of state responsibilities. These are arguable things in international law provided a educated population completely rejects the basis on which these loans were accepted.
Occasionally debts are forgiven but not completely forgotten. International banks usually try to negotiate a drop of exchange rate to sustain a lower scale economy for extremely valuable resources. This is so that repayments continue infinitely. So, an arsenal of formulae for inflation will have been imposed to keep the value of resources in Bhutan always extremely low. And, so people will forever continue to slave under the King to repay the loans cent by cent in US currency.
One can comfortably ask, why does Bhutan need to pursue ecological destruction in hopes of a hydropower economy when the main agricultural economy from the plains and the tourism economy of the North are capable of being equally self-sustainable? Electricity could have been provided to almost all small towns and cities with smaller scale power stations which do not unnecessarily dam water on a large scale causing wide spread environmental destruction and most importantly costs less? Debts could be paid out far more quickly too. The government could have set up a proper government department collecting revenue from one mini-power station to pay for the installation of another.
Low scale businesses in the Bhutanese communal style could have propped up all over Bhutan with the widespread distribution of electricity and would have created better revenue from packed rare herbs or packed foods of the Himalayas. With enough agricultural produce many food products could have been processed in Bhutan with the energy at key agricultural locations, starting with the famous yak cheese. Rather than sending raw materials for a meagre sum, finished products could have crossed the borders. But, big hydropower stations stand today only to drain not just the water but also the wealth. The international loans are the not the key, it is the lock. Repayment of the loans is simply not mathematics; it involves the ongoing exploitation of natural and human resources. While the exploitation of resources expands in Bhutanese currency, the interest rates to the loans increase in western currency. The problem lies right there. They are simply unpayable loans.
Had it not been for the hydropower entrapment, agriculture and tourism would have sustained the exchange rate to a far sustainable extent. It is not being argued that Bhutan should not have electricity. Rather electricity should have been an energy resource to increase production not something to sell off to neighbouring countries to meet unreachable loan repayments.
No matter how low scale the economy, at least the people would have been happier to have a healthier economy than a bigger and an unsustainable one.
Doesn’t GNH mean striving for a greater balance with the environment and greater happiness – (whatever type it may be)?
The King neither tells you nor asks you why Bhutan should never have taken up huge hydropower debts. The King takes advice from international bankers and construction experts who are outsiders and who simply want to make money.
And, it is wise to remember exploiting resources of the East has and will continue to be a business for the West. It is an ongoing process till the end of time. The continuing neo-colonial history of the world right up to this day proves that business tyranny is irreversible unless tackled by a revolution. The exceptions that exist worldwide to the widespread rule are fewer now than it was half a century ago.
What was expected, and is interesting to note, is that now foreign eyes are being laid on mineral deposits of Bhutan. You see, once the debts soar into the sky it sets in a chain reaction of other debts and obligations to the regional superpowers or to the West. The King or the government is compelled to engage one natural resource to overpay the burden of another. And to overpay the other, another must be exploited. It sets in a chain reaction of environmental wreckage.
Yes, Bhutan will enter into this age of wreckage to preserve its current monarchical statehood. Or else it will simply go bankrupt. International finance is controlling everything. The King has gained nothing from this, neither the Shabdrung monks and nor the citizenry. The keys to the Bhutanese economy have already been transferred overseas and only a true revolution by the people can reclaim authority over its resources and its life. Surely, the King and his folks will live comfortably. The monks will remain revered by their slaves. But the rest will have to perhaps start thinking of rising above tyranny for there is no alternative!
Measuring GNH~ the new accounting system~ Measuring economic gains
The media is there to spread everything on the table. And, it takes only the least powerful eye-glasses to see a vision. As Gross Domestic Product (GDP) is on the rise as Prime Minister Thinley continuously reports the National Bureau of Statistics have taken up an interesting task. They are working on a method to calculate GNH. Environmental harmony is one of the core principles of the theory and is perhaps the most important. It is being theorized that based on the total natural resources of the country, GDP per person is worth US $ 1,584.90 million in 2010 out of a total of more than $700 billion per year. This is purely mathematics on paper rather than reality.
Keeping the environmental value in mind the next question which comes to my mind is does that mean Gross National Happiness is being calculated in dollars? Is it economically ascertainable?
So Gross National Happiness is an economic concept? That is something that has been denied for the past forty years. Why does the valuation in US dollars amaze us and perhaps makes us a little happy? What if every state in this world carried out the same calculation? The differences between valuations of different nations would have been interesting to see. Bhutan is not the only country in the world which has resources. Almost every nook and crany of the planet has exploitable resources. But in fact Bhutan is an exception to have calculated the resources per person. So does that mean US $ 1,584.90 million will belong to each person? When? How? If an individual’s million dollar wealth is to be utilized will the government seek the permission of every citizen before using it?
Questions fly here and there. Will the upcoming mineral deposit boom pay royalties to individuals because the resources belong to each individual? Of course the answer is a No. It simply belongs to the state of Bhutan= King.
Bhutan is either putting its statehood at risk or simply joking. Indeed GNH is one of those few elegant jokes that manage to take out a real neat laugh every time you say Gross National Happiness!
Prime Minister preaches what he doesn’t follow!
The Prime Minister went on national television with great depravity but alas pointing out the lack of commitment on the part of the people of Bhutan with their spendthrift habits i.e. spending too much on Indian goodies. This must be understood with a deep sense of humour.
Indeed, the PM himself incurs expense- at home, parliament house to home, Bhutan to elsewhere, elsewhere to Bhutan on exported goods and services. It is more shameful to an onlooker than the person who gets lost in the open, as you can see evidently!
As everyone appears happy with the decisions of the government and also with the statement of the Prime Minister, I can logically deduce Gross National Happiness is inversely proportional to economic progress i.e. directly proportional to economic deterioration.
The Real Picture
The currency deficit is a clear sign of ‘unproductive’ use of natural resources even when so many rivers have been tapped into hydroelectricity, many mineral plants have opened up and tourism has soared; unproductive to meet loan repayments and public spending costs- even when productivity is claimed to be on the rise. How can this be possible? The Prime Minister continuously boasts an increase in GDP, then why does the currency still deteriorate?
Look GDP has increased yet there is no proper value in commodities to exchange outside the country. What must be clearly understood and I cannot better emphasize that though the process of producing exchange value can be on the rise this is not necessarily the case of the final product. Yes this means the methods to produce value – labour, investment and natural resource exploitation can grow. This is the process. However it is the final product that has less market value. This could happen for two reasons.
First the goods are not valuable. You cannot compare a kilo of bananas with a kilo of pure gold. Or the second reason which is the more likely cause in the case of Bhutan, is that currency negotiations intimately linked with resources expansions has simply devalued the real value of resources. This has been the case with the majority of the developing nations owing debts to international banks. E.g. Peru, Ecuador, Brazil, Bangladesh, Eastern European and also many African countries. The globalization of poverty is generally on the rise. Plenty of evidence exists globally and perhaps also in Bhutan. If only one could get reports and papers relating to currency negotiations which are obviously well guarded national secrets. Any attempt to ask for these papers will be met with dark forces than gleeful photogenic smiles.
Additionally the increase in GDP is simply unmatched to the scale of increase in interest rates on external foreign debt. A major part of the revenue simply disappears to cover debts and interests. Even the little inflationary increase in value of the products of Bhutan is subsumed within the mother inflation of international debts.
On the whole we can use this analogy. Take for example a mug: Bhutan’s economy. It is scooped to gather water from productive natural resources the country possesses or produces. The point we always miss is that interest rates on international debts grow by western country standards. Every year the mug must get larger to meet obligations.
This is happening because the quantity of water owed to our external lender heroes always increases so that they can tap into the resources for their wealth for an infinite period of time. In their philosophy Bhutan of course is not supposed to overcome its debts. Whatever water remains in that mug for the sucked out Bhutanese population, must be divided amongst an ever increasing thirsty population; the rich and influential being the first ones to be served and the farmers and labourers of Bhutan the last. The very population which helps to exploit the resources of Bhutan continues to further get exploited. Unfortunately that is what will force the Bhutanese Government to increase its exploitation of labour and natural resources in the future.
As Bhutan enters a new age of environmental wreckage, the environmental advocacy cloak the King wears is rather shabby. You can never stop laughing at the Emperor’s new clothes if you possess the honesty of a child!
The currency deficit provides a clear insight into a completely off-balanced – balance of trade. Bhutan suffers economic hardship not because of foreign labor or any other trifle reason. The hardship has descended because of decisions to take out huge international loans without proper thought over ecologically and economically unsustainable means to provide a better availability of exchange value within an economy. I have described earlier how a better exchange value could have been cultivated.
The weighing balance of international trade will remain blind-folded. Trade is not carried out for justice. Its sole purpose is to facilitate the control and expropriation of value. The King of Bhutan and his folks have simply overlooked what they constantly thought they were taking care of.
So Bhutan in the Prime Minister’s plan will perhaps resort to eating only raw national products, walk on foot to avoid using petrol, heavily relying on the air to remain healthy, use traditional medicine and avoid condoms. Recourse to the service of astrologers would perhaps become popular rather than going to the doctors across the border. Imagine astrologers of Bhutan giving contraceptive advice. All this looks very happy. Of course there must be native doctors but the majority of Bhutanese do not have access to basic health care in their localities whereas astrologers are found everywhere in Bhutan.
I make this hypothetical induction in the context of the statement by the Prime Minister on national television, the religious dogmas that are used to spruik an innocent population and the forcefulness by which the people have to be happy on an average.
The future looks grim!
(Originally from Sibsoo, Bhutan, Avishek Gazmere is a University Student currently living in Adelaide, Australia. He can be reached at [email protected])