Sriram Karri | India’s women can offer lessons in smart economics

My grandmother taught me the first lessons of economics when I was hardly five years old, after I was foolhardy and rash with a grand sum of Rs. 2 she had given me a day earlier. Never spend all the money you have, never spend it all on one go or to buy just one thing, she instructed me. And then sweetly asked, “Would you like to have some more money?”

I nodded. She explained that there could not be any more charity or gifting this time, and listed several chores I could undertake to do, and if I did them well, she would pay me. The total scope of wages, I was made to realise, would be around Rs. 10 within a month. Valuable lessons, but these were the very principles on which she managed our household for several decades. A very small wage, big family, no assets, lots of expenditures and pressures, yet she managed to save and keep the ship steady.

Nothing sui generis, most Indian households have been managed by women with smartness and sound economic principles. In fact, we could all learn a thing or two on economics from the Indian women, as I did, learn my second lesson, from a neighbourhood aunty, who was also our entire colony’s preferred adviser on financial management.

She would convince several of the maids to open bank accounts in their names, and even help them with their early banking transactions. She also convinced us to enter into a commitment on savings, by undertaking recurring deposits. And she destroyed more informal “home” or piggy bank cash savings in those days and turned them into formal bank accounts by using folksy examples to explain concepts of inflation and interest rate.

Most of your life gets set with such simple examples — savings, accumulating interest, empowering your savings with commitments and harnessing the power of compounding. Then, of course, were those wise ladies in the colony who built the first ‘chit fund’ groups, which ensured all women turned small, loose savings into a bigger amount and used it to purchase an asset for the house.

Most modern lessons on diversifying a portfolio would not surprise any Indian household whose economics are steered by steely women of convictions and home truths. Gold has been the chosen method to save, a multi-purpose way to hold value and preserve savings, fighting inflation, and an easy to ensure liquidity during emergencies.

Most of the world’s hyper-inflation began when central banks abandoned the gold standard as being unviable and no longer pragmatic for the future — and eager to adopt Keynesian economics — giving governments the reckless instrument of deficit financing and easy money to spur “growth”. This is how households are run by dads and uncles, when mother and aunts are all on a rare holiday.

I never realised, nor did even perhaps my dad, when my mother would suddenly spring a surprise by telling us that she was going to buy a plot of land. What? Did we have so much money? Did my father even earn so much? How did she save so much? Then we had to think hard to realise how many expenditures we had proposed in the last two years, but she had calmly lied saying we had no money for it.

A holiday, a new colour TV, a motorcycle — nope, she vetoed them all. Priorities for family and priorities for money in a way she saw fit.

On International Women’s Day, going beyond clichés, one must look around, go back in time and analyse to be truly humbled into realising at how much wiser, saner, smarter and productively higher in the ladder of economics the women around us are.

The CEOs, CFOs and bankers, ministers and officials, every formal position holder in the world with the smarts, irrespective here of their gender, must think of the traditional Indian householder of a woman they best relate to refresh their economics primers.

The economy is so much larger, the needle has risen so much higher on the scale measuring women’s education and empowerment; the opportunities are vast and the earnings have risen too.

But the average Indian household, the building block of the economy, may or may not be managing its affairs as wisely as before.

Yes, we have transformed into a consumption-driven economy, and a more consumerist mindset society; we are increasingly measured by where we live, what we wear, or dive, and what we showcase, and to do it, are allowing a sea of debt to drown us; but whatever those wonderful women I recall running households would not approve of then, are not too healthy or good even today.

It is the new economy, with cashless micro transactions and all, but it is still old economics. You work hard and earn, you save some, never spend all of what you earn, to be in debt is not a good thing, and don’t spend on everything you think you want.

They were — my grandmother, my neighbourhood aunty, my mother, and a few others — the best financial advisers and practicing economists I ever saw and met — and on Women’s Day, can’t think of a more necessary ode to sing than for their wisdom, and acumen; amazing then and relevant today.