Cashless is painful: Address the panic in the street

Post-demonetization, the country is in a state of economic convulsion.

To keep it from turning into a social seizure, the government has appealed to patriotic fervor, raising every notion from the soldier’s suffering to the promise of a clean and bright financial future for the country. The poor are celebrating and the rich are losing sleep, the Prime Minister has formulated. The reality is that after a few days of initial excitement, the consequential enormity of the decision to demonetize is beginning to set in, both within the government and the masses, the poor included.

There are many who support the decision in principle but say the implementation should have been better planned. That is perhaps an unreal expectation, given the very nature of the operation. The requirement of surprise necessitated that implementation-level government hands could not be involved. A lot of the planning is thus happening in real time, as the scheme moves along. Therefore, the government is constantly finessing the cash withdrawal, which only adds to the confusion and panic. Small trade has dropped drastically, daily-wage earners in the unorganized sector are missing out on employment, vegetables are rotting, farm cooperatives have been rendered inoperative for the time being, and the huge majority that was yet to enter the banking system is at its wit’s end on how to exchange their old currency.

Social media, often taken as a barometer of national sentiment, has largely given a thumbs-up to the scheme. But this could be misleading, because the middle and lower middle classes that inhabit this space have alternative means of survival. The rich, who run the economy, and the rural poor are only yet forming their opinion based on their felt experience, which may not be very pleasant. The government will do well to pay heed to every section. The woeful lack of currency and means of its distribution have betrayed a lack of planning. Given the official haphazardness, who can feel assured that the implications for the long term -projected to be positive – have been calculated accurately? Tomorrow will be understood only when the dawn comes.