An anonymous tipster posted a fascinating story on the SM News Tab about the underground economy in the Dharavi slums outside Mumbai.
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Poor but far from Idle |
Dharavi, considered Asia’s biggest shantytown, two square km (0.8 square miles) [consists] of open sewers, muddy lanes and ramshackle tenements that is home to almost a million people.But strip away its squalid veneer and Dharavi bares a unique entrepreneurial spirit, and multi-million dollar micro-businesses, that breaks all the stereotypes of a slum.
…Arguably the most prosperous among the world’s biggest shantytowns, Dharavi has about 5,000 single-room factories and hundreds of cottage industries that together have a turnover of around $1 billion.
Practically every home here produces something to sell – incense sticks, poppadoms, pickles, soft toys and candles among the many crafts.
Much like the startling statistics about the face of poverty in the US, a similar spate of data about Dharavi lifestyles showcases accoutrements which would have been decidedly middle and perhaps even upper class just a few decades ago –
…In recent years, prosperity has been trickling down to Dharavi’s residents. There is 24-hour electricity and running water, and 2006 research shows 85 percent of households have a television, 56 percent a gas stove and 21 percent own a telephone.
So if they’re so productive and have such amazing turnover, the obvious question is why is the place a slum?
I’ll toss up a few theories based on some current thinking in developmental economics and encourage mutineers to offer up their own –
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We’re in the midst of transition — Dharavi wasn’t always this productive and has only recently achieved the growth described in the article and thus, just needs to be given some time. One can readily imagine that much of the small scale production in Dharavi was driven even deeper underground during the license-raj era and economic openness just takes time to “trickle down”.
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Public Service Ethic — A key ingredient for economic growth – particularly at the small scale is an efficient public sector imbused with a “public service ethic” – something somewhat famously lacking in the desi bureacracy. Arnold Kling illustrates by way of example here:
A public service ethic is something that we take for granted in the United States. If you want to open a restaurant, you may find the paperwork and regulations irritating. However, at least you can count on the public officials to process your application in a reasonable time without requiring a large bribe. In many other countries, the conduct of state employees ranges from routine petty corruption to organized extortion.
As hard as it is for suburban the middle class to navigate this milieu one can only imagine the utter impregnability it must present lower class slum dwellers. The article other others note that part of the solution for public infrastructure in Dharavi is partial privitization of these services via some of the most massive, private-sector managed urban building projects in Asia. -
Hidden Capital & Property Rights — Hernando De Soto’s Mystery of Capital was, for many, the single best explanation of the phenomena of Hidden Capital. According to this argument, the key thing that prevents the 5,000 single-room factories from combining forces, achieving scale, and thus far greater wealth is the lack of firm property rights for existing operations and thus collateral for investment capital to expand. Without contractual enforcement predicated on clear, legally-enforced ownership of your factory, you can’t get the institutional assistance necessary to succeed.
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Social Capital & Trust — Paralleling the financial capital argument put forward by DeSoto, Francis Fukuyama puts forward a social capital based argument for interpersonal trust. In addition to governmental infra necessary to scale up a business operation, this theory recognizes significant issues at the entrepreneur & employee level as well. The normal ebb and flow of doing business requires that biz partners & employees trust each other in a deep way to carry out their duties with the best interest of the firm in mind. In lieu of such trust, it’s rare for the firm to scale beyond the size of a single family unit — e.g. the “mom and pop” shop.
Complicating matters is how many of these factors exist simultaneously and feed on each other. There’s a type of “trust” between the individual and the state necessary for an efficient public sector. One of the biggest drivers for “hidden capital” is mistrust of both the state’s corrupt tax man and neighboring, potential business partners. And the solutions are often intertwined as well – the trust necessary for spontaneous formation of desi IT firms, for ex., is no doubt motivated by the highly visible rewards that come from teamwork and GNP growth. Either way, it’s heartening to see Dharavi appearing to make progress on all fronts.
Many of these people prefer to stay in the “slums” because they make tons of money without any accounting or tax purposes. Also, many of them tend to love the sense of community they find in these places. Maximum City has quite a few anecdotes from people who had the chance to move up and regretted it.
What, then, is your definition of a slum? Maybe they have all the amenities they need?
And if you want to make a credible argument about something, anything, please don’t quote Fukuyama 🙂
Let me offer another hypothesis. The Dharavi world is in some respects strikingly reminiscent of the world of Adam Smith and the classical economists, a world of the individual, self-employed entrepreneur competing against numerous other such entrepreneurs. This world, unfortunately for its participants, is nested in a world of firms (which remember should not exist according to classical economics; hence Ronald Coase’s “Theory of the Firm”) and other interests that, though in a minority, are highly organized. Therefore if you construct a bargaining model, you will find out that the slum-dwellers, not being organized, realize very little of the profit (you will notice that an “institutionalist” rather than “marginal productivity” conception of capital is implicit in this hypothesis).
An earlier SM post on poverty tourism in Dharavi.
I forgot to add that if my hypothesis is plausible, it follows that unionization of these self-employed workers should probably improve their situation. Hence we need more organizations like SEWA.
It is interesting to contrast this post (and Abhi’s interesting one about the one lakh car), to Amardeep’s post on Mr. Mishra and Dr. Nusbaum.
My instinct is that India’s middle and urban working classes are moving in one direction (towards freer markets, confidence in their role in a globalized economies), while many academics / intellectuals view India’s increasingly rapacious aspirationalism as negative.
There was a pretty good article in National Geographic a couple months ago about Dharavi that touched on the resourcefulness and self-sufficiency of it’s inhabitants as well as the value of the land upon which they reside.
It gave me pause about the stuff we throw away each day. I recycle but it all goes into a blue trash can that is picked up twice a month, but who knows where it ends up. It also reminded me of Fight Club and how Tyler Durden sells back rich people’s fat to them under the guise of designer soap. Who knows the shirt you buy at Neimann’s or Nordstroms or the paint you use to faux your walls may have been recycled in Dhavari.
This article may have some insights:
FROM WORK TO WELFARE A New Class Movement in India
The rigidity of early class analysis and the recent demise of any type of class analytics have turned attention away from examining the growing population of informally employed workers as a class. By not examining informal workers as a class “in themselves,” we are losing insights into how they are translating their positions into a class “for themselves.” As a consequence, the recent literature on globalization and liberalization is increasingly concluding that the decreasing proportion of formally employed workers (and the subsequent rise in informal employment) the world over signifies a decline in all class-based organization. Such arguments have obscured our understanding of the current social dynamics of exploitation and resistance. In an attempt to begin filling this gap, this article recovers class as an important analytical tool with which to examine (1) the current relations of power between the state, employers, and the majority of India’s workers, and (2) how the structures of production within which informal workers operate affect their collective action strategies. A reformulated labor movement model is offered to expose the underlying mechanisms through which informal workers translate their location in the class structure as a class “in itself” into a political group as a class “for itself.” Insights into how informal workers organize can have profound implications for our understanding of changing state-labor relations as national governments attempt to liberalize their economies and simultaneously rein in their welfare functions.
Previous post on the Dharavi economy.
I know too many people who argue that DeSoto’s work is a “Just So” story, it has a cute explanation but it is factually incorrect in important ways. I haven’t read the in-depth critiques.
Vinod
The problem is not property rights (though it would be in another context; eg. in villages where unscrupulous landlords and other feudal elites try to deprive small landowners. Though even here the problem is not these rights per se, but to get the state to recognize them in the face of strident opposition from other, more powerful vested interests). The problem is lack of collective action. The problem is how to combine and pool individual property rights (that already exist) and transform this into market power in the face of various organized interests that would oppose this move(such as traders’ cartels). And it is not easy to gain state recognition even after you organize and form unions, since the state is not very responsive to these people. You should read Ela Bhatt’s We are Poor But So Many (OUP). Its not that simple Vinod.
Ennis
Yeah, in places the arguments are almost circular, but in others they are pretty good (once you restrict them to certain context and apply certain ceteris paribus conditions, which De Soto does not always do).
I want proof.
i’ve seen this phenomena–the rich poor–up-close in the US. welfare recipients with hundreds of thousands in investable assets. insurance companies know all about this and send agents into the projects to get them to put their $$ in cash (whole life) insurance policies that have little tax reporting and are tax advantaged. sandy weil set up primerica (part of citigroup) in part to penetrate this market. i knew a smith barney broker whose biggest client (around 5m, i think) was a professional beggar. BOA knows what its doing when it issues credit cards to illegals. the whole sub-prime mortgage market knows all about the hidden wealth of the poor with their no-doc loans aimed at illegals, welfare moms, small biz owners, limo drivers, plumbers, etc. entrpreneurship+ avoiding taxes=wealth
the professional class is really missing out.
but what use is all that money when you have to live like a beggar? I am assuming the guy didn’t change into clean clothes and drive back to his $400k house in NJ. Did he?
he lived in a house in queens with his mom. he dressed like a bum though.
I think Manju has it correct. Also see this paper which talks about parallel economies in the world.
Oh my god. Manju, I can’t believe you trotted out the tired myth of “rich poor people.”
Do you really, for one moment, believe that there exists a hidden privileged class that looks, acts, and lives the lifestyle of poor people…simply to mask the fact that they’re secretly rich?
You’re nuts, man. Seriously, find me one non-anecdotal example of a person that fits that bill. There’s simply no such thing as “rich poor.” There are rich people…and there are poor people. A rich person who dresses poor and lives in a shack is still rich. He’s just weird, too.
And the hidden economy is very different from this notion, brown.
I believe ghostface killa put it best when he exclaimed, “Those smart-dumb N^%^#@s”
the rich-poor, the smart-dumb–all conspiring to steal the rug right from under us hard-working smartypants millionaires.
Slum is such a handy word for deflating property values so that developers can buy tracts for a song. If Dharavi were billed as an example of the New Urbanism in India (an American notion now being used to define hip, mixed-income and mixed-use development in former slum areas, especially in Africa–Johannesburg, Durban, Nairobi, etc.) then those parcels would be expensive and the residents would have a political voice. The Mumbai Corporation wouldn’t be able to bulldoze hutments or refuse to extend sewage and electricity connections.
Slum = poverty = crime = violence = squalor = cheap land.
That fact that Dharavi is economically vibrant and diverse flies in the face of its famous moniker as “Asia’s Largest Slum.” As if it’s charming that such activity takes place in a slum, even amid the industrial pollution and standing sewage.
New York’s Lower East Side before the Second World War was as rough and squalid as any place on the planet, filled with “undesirables,” Jews, Irish, Germans, Russians, Poles–Catholics and Jews–not the Anglo and Dutch (Protestant) elites who controlled the city and provided few incentives for improvement of the area. Do-gooding societies (the NGOs of the day) provided a little relief. But mostly the people were on their own. The Lower East was never bulldozed and cleared, but slow change came from zoning laws and building codes that resulted in a greater safety (especially from fire and disease). The area lay fallow from the 1940s to the 1980s, as the immigrant residents found other, better places to live in New York.
The people of Dharavi shouldn’t have to wait two or three generations to see their area made livable. India’s (and Mumbai’s) economy is strong. There’s no shortage of good ideas about how best to improve the area. There’s plenty of money. There’s just no political will and the system, especially the government, is corrupt. Rather like the Gulf Coast after Katrina.
Yep they sure do. I suspect the “goodies” the poor in America have will shortly be arriving to slums globally.
Manju I think there isn’t as much sophistication as you suspect with the insurance policies. The earliest black enterprises in the US were beauty/barber shops, and undertakers/funeral homes.. these became funeral societies- and some very successful black owned/operated insurance companies. I suspect that in many cases the families you are talking about have a grandparent whose knowledge of financial instruments starts and ends with a “policy”. That matriarch may be the most stable person/care taker in the family unit, who makes the ‘investment’ decision.
Somewhere along the way it became a culturally necessity’ that no matter how dirt poor you were in life,your family had to “put you away nicely”- having a policy meant you could have an expensive funeral. A simple(cheap) funeral was a key doctrine preached by the Nation of Islam to combat the backwardness of that line of thinking.
not sure what you’re talking about salil. i never mentioned any hidden privileged class or living the lifestyle of a poor person to hide the fact they are secretly rich. the bum i met has a house and car. lots of middle class looking people are really millionaires (check out “the millionaire next door”…required reading in the brokerage houses). warren buffet himself lives in a middle class neighborhood. so, i think the people i met in the projects are living under the same philosophy as buffet and the millionaries next door.
you’re burning down the strawman salil. i never mentioned a shack. many inner city projects are hardly squalor, check ’em out yourself. i guess the phenomena of hidden assets is tied to the fact that many people with wealth prefer to invest and save rather than spend. i not aware of the myths you’re talking about.
dilettante:
this definitely rings true. culturally, as a group, US blacks are married to these policies. but the use of these policies in the manner you describe does not exclude a more sophisticated use. i think insurance companies probably used the trust they had built in these communities with this product as a natural launching pad to secure the wealthier among them who need to hide cash they have no intention of reporting to the irs. so more sophisticated riders were built into the polices (“Paid Up Additions Rider”) and the govt was lobbied by the all-powerful insurance industry to make this $$$ and interest non-reportable (or less reportable, i forget).
so you’re right, whole life did not begin as a sophisticated tax scheme, but upon the discovery of the hidden wealthy in poor neighborhoods, its surely become one.
19 Manju: “(check out “the millionaire next door”…required reading in the brokerage houses)”
My favorite book! Like most revelations, not a theory but a discovery of patterns that have always existed. It’s just that nobody had quite put it that way.
Vinod’s post: “So if they’re so productive and have such amazing turnover, the obvious question is why is the place a slum?”
Slum is a relative term. In a country like India, there are even better “localities” than Dharavi, to use Indian English for a second, that are slums by western standards. I have relatives and friends living in lower middle-class neighborhoods with open sewers, cattle roaming the streets and children defecating in public. Yet there is no crime on the streets, no drugs, no truancy among the children, no broken homes. These are people who have good values and great aspirations for their children, who work at clerical jobs or run little shops, send their children to schools and colleges, and usually see their children do a little bit better than them and move to a better locality. That’s an upwardly mobile society, not a slum even by western standards.
I try not to romanticize about India. My point simply is that living conditions alone do not define a slum. The acid test of a slum belongs more in the values and lifestyle department. The tragic lives of poor African Americans trapped in a Chicago project, with window air conditioners and elevators that do work, define slum. Dharavi may be just a poor neighborhood in a poor country. There’s a difference.
Sorry. Forgot to mention the book, “Shantaram.” I am sure most of you have read it. (How the heck do you do those link thingies?)
yes. a great book floridian. i had to read it–when i was in a training program at salomon smith barney–in conjuction with “the warren buffet way.” went together like sushi and saki.
highlight the word you want the link to appear in. then hit the 2nd icon (some ball-looking thingie) after “comments.” then paste the link into the box that appears.
Great posting, discussion. Thanks!
Here’s a superb photoessay by English photographer Rob Appleby on Dharavi. His work is notable for being ahead, by many years, of the current interest in Dharavi. The National Geographic photo-essay is (IMHO) derivative of his work.
http://digitaljournalist.org/issue0204/city_intro.htm
Preston, with respect to your comment #17, the Economist recently had an article about plans for developing Dharavi.
Interesting and important questions, Vinod. De Soto’s argument is all the more relevant in this case as the BMC and its legions of vested builder interests are trying (with a nod to social needs and housing the displaced) to turn Dharavi into a legal sort of place, settle residents elsewhere, build new units on the land, etc. So if you were to recognise the Dharavi residents’ right to their homes and land and small businesses in some way, and give them certificates or compensation that they could use to buy property legally, would that lead us to de Soto utopia? I doubt it, because one of the reasons Dharavi works well is precisely that costs are kept low by illegality and informality. You couldn’t run cheap production units out of there with market price land, just as the old mills in Bombay couldn’t be profitable without the cheap 100 year leases given to them back in the day. Would Dharavi residents be able to make better and more secure lives for themselves, even if not in Dharavi but in resettlement colonies, once their property is legally recognised? I don’t know. But I’m sceptical, because every time the govt has tried to get rid of slums they have come right back, because the city is built on and depends on these low-cost workers.
I agree Preston.
I think enterprise and hard work are great and should be rewarded…but not with a trickle down that’s going to arrive after people like the guy photographed above are probably dead.
Maybe it’s the floods of wealth in other countries which have contributed to a ‘trickle’ of money so small in the Third World that the majority of the world still lives in poverty.
This new instalment in the glorification of poor people as hardworking and enterprising just reminds me of all that discussion about tiffinwallahs who went to lecture people at Harvard Business School. Where the fuck are they now? Oh, that’s right, exactly where they were before. I guess maybe they’ve got a photo album with a few snapshots of them and some guys in pinstriped suits.
Obviously with all the economic rationalists around here I’ll just be labelled and then shot down as a bleeding heart liberal but I’d rather go down and be seen by them that way than say nothing about the rather disgusting stench of the inconvenient empirical side of purist neoliberal theory that is seeping through this post and some of the comments.
“Poor But Far From Idle” as the caption to the post suggests that it should come as a big shock that poor people actually! don’t! sit! around! ripping! off! rich! people! Some of them might just be working hard and as a reward all they have to day is wait 500 years and maybe somethin’ will trickle down the way a tiny drizzle of rain would quench a dying man in a desert.
Yes, I’m making a ‘choice’ to participate in a global economy (even though nowadays privatisation has become the only option for almost everything that used to be publicly provided), yes so is the guy in the photo, yes I did live as a middle class person in Mumbai and yes luckily for me I live on the right side of the global economy and now live a middle class life in a first world country.
Does that mean I don’t think there’s something wrong with presenting the world’s richest slum as a celebration of what’s right with the world? No.
Don’t tell me that just because I can afford to sit around on a computer doesn’t mean that there isn’t something instinctively, intuitively wrong with discussions of people on welfare making ‘hundreds of thousands of dollars’ while the professionals are missing out in the US, or rejoicing that although people in Dharavi are still dirt poor, they work hard for their dirt just like good little worker bees.
On an intellectual level economic rationalism and neoliberal theories are interesting, well thought-out, appealing to logic and full of hope for a better world.
In real life, when they dominate the global economy, this is what we see. Followers of neoliberalism actually discussing why people are still starving and dying which ends with praise for their determination and a vague hope that soon (maybe tomorrow!) that $1 billion in revenue will pop up like a pot of gold at the end of the rainbow, because that’s how well their system is working.
It’s sick and sad and wrong, and yes, I would be willing to give up some of my privileges to even things out a bit and I think many people are willing to do that too. I think people like those in Dharavi don’t need a handout or even a helping hand, they just don’t need one that shuts them down every time they try to live a life of human dignity. The world economy needs fair trade, just as a start at least. We don’t have to make a choice between pure free market liberalism and people living in utopian communes. We just need to make markets fair.
Feel free to shoot me down now, Manju et al. I’d rather voice my view that if this is what ‘India Shining’ means, then I think it’s a sad, pathetic facade.
And I think the neutral, rationalist discourse of classical liberalism hides a racist, sexist, and highly discriminatory vision of the world.
Neither of you have lived in India with its political will trying to help people. Tash, I agree that we need to see the people get better, and notions of “trickle down” is probably way too vague. But like you say:
That is exactly what will happen if you get the government to help. I dont care for the Harvard types inviting tiffinwallahs. But I do think that left alone, most groups in India will do quite well for themselves. Statistically, there is no reason to believe otherwise. And as most will attest in India, the biggest impediment to progress in the last half century was the government not doing its job because it was so busy doing things it should not have been in. Not poverty, not ignorance, not helplessness like the “progressives” so want to believe.
Governmental non-interference is not just about corruption in India. Personally, I believe it is fundamentally not possible in India to institutionally lead people by hand out of poverty. Because to do so inherently requires sacrifice, and guess what? Group A (most powerful) makes Group B sacrifice for Group C. Example: Arundhati Roy can cry herself hoarse against globalization simply because she can afford it—when push comes to shove, who will pay? it is the lower middle class kid who will probably be the first generation in his/her line to get out of poverty and need, not her. She may even cite examples of how if the lower middle class kid stayed poor, others may not go hungry. But the fact is, she is not the one who will have to sacrifice—if she does, good for her. But she has a choice, and however good her intentions, what happens? The hungry go hungry and the lower middle class kid remains half hungry and frustrated.
Socialism is doomed in India, because it is simply so much easier to put down people than to help them. And I think the more diverse a country is, the less practical socialism is because group identity will prevail to put down some at the expense of others. Besides for the most part, socialism has only worked in countries that had colonies (internal or external) to leech off.
Not to say some government intervention is always unwarranted. The rural employment scheme for example. There is ample scope for corruption, but there is hopefully there is a way we can make it work. But I would prefer that the government lay its hands off Dharavi, neither helping developers (who will move in sooner or later) nor stalling them unnecessarily. The people there can negotiate their way out with the developers, the government only needs to see that no laws are flouted in the transactions.
And more generally, the job of the government is not to micromanage. With very few exceptions, it is to regulate so that the economy grows. Get credit to people—good. Improve transport, so that they can sell their products at better prices—good. Fix prices so that no one takes advantage of farmers—disaster. List worker rights and make sure they are enforced—good. Stop companies from firing employees—as is the case now—disaster.
Wrong.
I’m not an advocate of socialism, I think capitalism just needs fair trade.
That way all enterprising people can gain (unequally, depending on luck, merit etc.) from their businesses, as long as the base level of their gain doesn’t involve them living in slums.
This is incorrect as a blanket statement. What classical liberalism are you talking about? The liberalism of Adam Smith? Then you should carefully read the Wealth of Nations in its entirety; after that read his Theory of Moral Sentiments (I think you will gain an appreciation of how ‘radical’ the documents are). Adam Smith was an anti-racist when racism was not even in peoples’ radar screens. Same with the German liberal Wilhelm Von Humboldt. These people were deeply anti-authoritarian and deeply egalitarian. They railed against the State b/c in the 17th and 18th centuries that was the most powerful concentration of power. They would have railed against corporations if they were alive today. On the other hand your statement is more applicable to Malthus or Ricardo. But even here it is important to contextualize. True, Malthus said that people do not have any rights in the “market” (note Adam Smith would have been scandalized if he had heard that); but labor was also extremely mobile then (no visa restrictions, for instance). So basically what he was saying was that one should go to another market if one could not make a living in this one; any plenty of people did (They moved to the Americas or elsewhere in Europe). Still I agree that insofar as you equate classical liberalism with Malthus you are more less correct than wrong. But neither Humboldt nor Smith would recognize Malthus’s thought as “liberalism”. The problem is that terms such as “liberalism”, and “conservatism” have lost all their meaning because of their vulgar use for sloganeering etc. We should not be joining in reducing a rich body of thought into empty slogans (you can say the same about the Socialist corpus; indeed many anarchists contend that Bakunin or Prouhdon are the logical intellectual descendants of Humboldt).
Typo. and plenty of people did
Another typo: Still I agree that insofar as you equate classical liberalism with Malthus you are more correct than wrong.
How then can you even say that the government should step in for these people? We were a wreck before the govt went bankrupt in 91, and was forced to ditch socialism. You know then that there were no telephones in India because you had to prove that you needed one in the application process. Not due to lack of demand, not due to lack of technology, nothing. If you needed a scooter, again, you had to “apply” for one, someone would later approve it.
Unless you were already rich, you knew there was no real hope of getting out of partial dependence on ration cards—try starting a business, and there was no way you could until you bribed yourself out of the hundred laws you had to flout to start one. The laws were designed that way, to prevent travel abroad, to prevent businesses from exporting, to prevent businesses from growing out of subsistence. And if you have nothing to start with, how are you going to raise the money for it? Loans were not available without ridiculous collateral if you didn’t have “contacts”. Credit was meant to be discouraged.
If you didn’t have to go through all this, you are proving my point: your sympathy for government intervention in India exists simply because you were privileged enough economically or socially not to be hurt by it. I don’t mean to offend you personally, maybe you are an exception and the above doesn’t apply. In which case I take it back and apologize. But you know the point I am trying to make.
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i know it might be difficult for some of you model minorities to understand why someone would choose to live in the inner cities, so allow me to explain. first, they make their living there, so they want to stay close to the action. secondly, their money is off-the-books so they want to use some discretion. thirdly, they don’t see their neighborhood as slums or shacks as you latte sipping liberals might. in fact they’re vibrant communities rich with culture, history, family, and charm.
last but not least is the warren buffet effect. buffet’s worth 52bill but lives in a middle class neighborhood and drives a buick (or something). in short he’s not a social climber. you beorgeoisie have been trained to pursue prestige, not money, and cannot fathom the existence of someone not in that mindset. i’ve seen even the self-appointed representatives of the poor (like prema) thumb their nose down at motel owners and 7-11 franchisees. the professional class is concerned about climbing the social ladder. others, not so much. this goes also for white ethnic small biz owner who doesn’t pay taxes and lives in the working class neighborhood he grew up in, while having more investable assets than your average doctor or lawyer. (some of you have at least written a check to your plumber and done the math on how much he must make a day, right?)
we live in a country where something like 50% of those considered poor own a home. like dr. yunus, lenders have devised new ways to evaluate credit. i know, the foreclosure rate is higher in the sub-prime market, but for every 1 foreclosure there are ten people who own a home they wouldn’t have otherwise. in many ways the capitalist revolution is reaching the poor. the revitalization of america’s inner cities since the reagan revolution is one of the great unwritten stories of our time. illegals form that feudal society called mexico swarm to port chester and corona ny to benefit. someone told me on the immigration thread that 50% are middle class by 2nd generation and that perfectly coincides with my observations of portchester and corona as vibrant economies replete with bmw’s and satellite dishes (like an insane amount of dishes, i don’t know why). obviously, india’s growth is even more dramatic with 1% of the poor crossing over to the middle class every year. i don’t understand why some people can’t take pleasure in the poor getting some wealth.
I used to work with a guy who is from Washington Heights, went to Philip Exeter and Penn did well professionally and still chose to live in Washington Heights. The dishes may be because a lot of channels from Mexico are available through dish. BTW Manju are you still with Smith Barney?
no. left smith barney years ago for an ibanking boutique.
I don’t believe the studies that state people prefer to live in Dharavi. I believe that they simply prefer living in a cesspool to being dispossessed of their businesses if the govt. relocates them in their typical hamfisted manner. I’m sure if the govt provided: a) proper habitations with option to buy (ala the UK’s housing estate purchase scheme) b) Industrial park for their microindustries
the residents would happily opt for “New Dharavi”. They just can’t believe that the government would work in their interest to make this a reality so they opt for what they know
Louiecypher,
It is not as simple and there are many other factors at play, I am not sure if you have ever gone to Dharavi but new Dharavi is already there, there are slums and their are apartment buildings. With the inflow of increased cash the slums are proper structures now, people for one don’t leave as it is prime real estate in central Mumbai closer to the burbs and downtown. It makes commerce easier.
Also most of these businesses don’t pay taxes so getting them to relocate to Industrial parks is far fetched.
Do they have legal title to these proper structures ? If not it is not a long term solution
Probably older than most of u, educated here, lived in India for half a century. Point? I remember immediately after independence we did not have food, or even a sharp knife to cut with. We took food mixers, radios, pens, clothes back with us from the west. We came from a country totally devastated and robbed by colonization. Every product, good or miserable, had millions wanting it and so we needed permits for phones/ cars/ railway tickets, etc. We had ration cards to ensure at least some folk got cheap food, when it was available. You forget that today 350 million live in a fashion comparable to the US. The same no. as in the US. No other country has managed to do that in 50 years. That too this has happened with millions of refugees pouring from Tibet, Bangladesh etc and attacks by China and Pakistan every few years. By the way, India’s forex came from the poor Gulf workers not educated NRIs in the US (who send money to India or opt to live there only when the going is good). Yes, we have to take care of the other 600 mill and it will happen and no thanks to us NRIs or POI who seem basically good for criticising.
Hilarious discussion by 1st gen desi-Americans! Mere immigrunts like me chuckle as you try and figure it all out. Just as we middle class types used to try and figure poverty in India out when we were young and back home. You are no better informed than us; on the other hand I suppose its very creditable than you are not any worse informed than us middle-class young folk in India were back then.
Louiecypher, I believe those who live in the apartment buildings have legal titles, those who live in the kholis probably don’t, but there’s a rental market and their property rights are recognised de facto, even if not legally, by the cops, but as often happens in these cases, a resettlement program puts these de facto rights at risk, because the government doesn’t have much incentive to do right by these (uninfluential, often non-voting, non-Maharashtrian) people and the kholi owners don’t have much legal ground to stand on. But Dharavi is not one of those flimsy slums where people are worried about cops swooping down and kicking them out or anything, they know there’s too much at stake and it’s too big. Which is probably why its redevelopment is being approached with more planning than the ham-handed Delhi govt style version of “slum clearance.”
I’m not sure what the last two commenters are trying to say with their rather lame put-downs. I am from Bombay and my friends and family, whether as social workers or drawing-room policymakers, talk about slum redevelopment and land use a fair bit, it’s a vital issue for our cities, and the debate here is for the most part quite well informed.
What a load of bullcrap! Only someone totally clueless or totally delusional would make an outrageous claim like that. The fact that so many indians are actually dumb enough to fall for such nonsense is very disturbing.
I would ignore #43, and #44 (man, talk about stupidity and nonsense!).
Louiecypher,
SP is right the buildings are regularized and for the kholis it doesn’t make a difference if people don’t have legal titles, they are vote banks. People have ration cards regaular electricity and phone connections. The congress government in Mumbai tried to demolish some of the structures but the local politicians were not for it. Displacing the inhabitants mean upsetting a substantial chunk of voting populace. As for long term solutions, most of those people have been there for generations so that is as long terms as it cane be. And you understand that they only option for relocation can be outside the city (New Bombay) which nobody is willing to do.
Also do you understand is what may have worked in situations like these in the West will may not necessarily work in India. IF you have ever been to Mumbai you will know that the stretch going from Saki Naka to Sahar Airport was a cluster of slums, now there are many new hotels and they tried to regularize the slums by making a building similar to low income housing here. Most of the people who were allotted apartments have rented them out and have gone back to living the way they were. Someone rightly pointed out that it is the sense of community that drives them. The small business they operate out of their kholis thrive on these communities.
Brown
Thanks for the explanation, but you’ve only rehashed why there is inertia with respect to change. I don’t believe in Indian exceptionalism…sanitation and water are basic human needs. The residents of Dharavi have already shown remarkable ingenuity, we should expect the government to work with them to find a more liveable solution. Having a million people counting on political whim to avoid eviction is dangerous