For a More Progressively Evolving Society

Friday, February 25, 2011

Prout - An Overview

Prout - An Overview

Prout (an acronym for Progressive Utilisation Theory) is a social and economic system first proposed by the eminent Indian philosopher, Srii Prabhat Ranjan Sarkar (1921-1990). It is arguably the only socio-economic theory to emerge out of the third world that has direct applicability to the developed world.
1.  Prout attempts to draw on the environmental, social and spiritual wisdom that humans have accumulated over thousands of years of struggle, discovery and experimentation. It opposes social dogmas based on ancient texts.   

2.  A Proutist economy is based on the cooperative system. It is community based, decentralised and promotes an economic voice for women. Prout satisfies human needs by promoting the utilisation and rational distribution of all resources, physical, mental and spiritual.

3.  Prout also has a program for globalisation based on the concept of political centralisation and economic decentralisation

4.  Prout has a theory of class and a historical analysis based on the concept of collective psychology.

Building Communities
The primary goal of Prout is to build healthy communities which, like living systems, need to be nurtured and cultivated. An economic system cannot be divorced from the people, the community and the bioregion in which it is embedded. Therefore Prout opposes the neo-liberal agenda of deregulation, privatisation and free trade. These policies bleed wealth from local communities and the already impoverished ‘third world’ into a comparatively few centres of global economic dominance.
Prout advocates a constitutional guarantee that all persons have the right to obtain their minimum requirements of life, in particular food, education, health care, clothing and housing. After that, surplus wealth can be distributed as determined by the community values of the day. Prout also promotes a system of cooperative community budgets to determine the shares of annual aggregate income going to households, government and business. 

New Definitions Of Economic Progress
Per capita GDP is a defective measure of economic progress. It counts every new nuclear missile, tourist casino and cigarette sale as positive growth – as contributing to prosperity. It ignores tremendous disparities in wealth between rich and poor.
Prout recognises that human beings are not just Homo economicus. We have intellectual, emotional, cultural, social and spiritual needs in addition to the economically obvious physical needs. To satisfy these needs requires the management of many kinds of 'subtle' capital in addition to physical and financial capital. Satisfying these diverse needs underlies our productive activity and our community life. A healthy community with a healthy economy requires …
  • An expanded definition of economic resources: Future economic theory and practice will have to come to terms with a much broader definition of economic resources to satisfy the spectrum of human needs.
  • Multi-bottom line accounting: Prout supports the introduction of triple- and multi-bottom-line accounting to ensure efficient management of the full spectrum of resources.
  • New economic indicators: To measure social and economic progress, Prout embraces alternative economic indicators such as those developed by the Calvert-Henderson group and others.
  • Resource taxation: Prout supports shifting the tax base by gradually replacing personal income tax with a rational system of taxes on finite natural resources.
Economic Democracy

Economic democracy in Prout is achieved through 1. economic decentralisation; 2. a cooperative based economy; and 3. a significant voice for women in economic planning and decision making. Local communities can solve local economic problems more easily because they are closer to the source of the problem and by definition the problems are on a smaller scale. Economic decentralisation also decentralises population and so contributes to sustainable population centres.
Sarkar argues for five principles of economic decentralisation:
  1. Local people should have control of local resources.
  2. Production should be guided by local consumption needs and not profit motive.
  3. Production and distribution should be organised through the cooperative system.
  4. Local people should have employment priority in local industry.
  5. A community should not import what can be produced locally

Three Tiers Of Enterprise

Prout divides the industrial system into three sectors:
  1. Most businesses, especially those producing the essential requirements of life, are best operated as cooperatives. For example, the agricultural and housing sectors fall into this category.
  2. Businesses too small for cooperative management and producing non-essential goods are private enterprises.
  3. Very large-scale industries and key/strategic industries are public utilities. Key industries operate on a no-profit, no-loss basis.
Prout advocates a monetary system managed by a central bank run as a public utility with numerous cooperative banks providing ordinary people with their banking needs.
Prout supports the development of a balanced economy, in which the agricultural sector, agro- and agrico-industries, manufacturing and the service sectors all develop in balanced proportion. The agricultural and manufacturing sectors of so-called developed countries are being decimated by free trade. This is a worrying trend.
A cooperative economy will encourage a large not-for-profit sector which contributes to the accumulation of social capital. It would also recognise the productive role played by mothers and carers not employed within the formal economy. 

In the long term, Prout envisages the establishment of a system of tiered communities from the local to the global level. The lowest level would be the block, a bioregion having about 100,000 inhabitants. At the global level, a world government is essential to solve pressing problems such as global warming and human rights abuses. However a world government cannot be imposed from the top. When local communities around the world have economic security, they will naturally see the advantages of a world administration. Prout promotes the concept of political centralisation and economic decentralisation. This approach can make globalisation work for all . 

How Will It Happen?
The contemporary world is threatened by three main sources of instability. First, economic instability arises from gross concentration of wealth which generates speculative bubbles, most obvious today in the equities, futures and foreign exchange markets. All speculative bubbles inevitably burst. The flip side of wealth concentration is institutionalised poverty encouraged by policies of the World Bank, IMF and the World Trade Organisation. So the second source of instability is social instability, which in the worst case is expressed as violence and war. A third source of instability comes from environmental degradation and climate change. Given these sources of instability, each of them potentially catastrophic, it is hard to imagine how ‘business as usual’ can continue much longer.
According to Prout, societies transform themselves through dialectical struggle. The existing order (the thesis) in decay is gradually or rapidly replaced by progressive ideas (the antithesis). The antithesis to capitalism is already emerging. Civil society including community, women’s, workers, indigenous, artists and green organisations all over the world are setting the agenda where large business corporations and governments have failed. 

Personal Change

An important lesson learned by political and social activists in recent decades, and arising in particular from women’s experience of social struggle, is that social change requires personal change. Outer change must be accompanied by inner change. Keeping this in mind, Prout encourages three kinds of personal transformation:
  • Universal outlook: the struggle to accept all women and men, regardless of social status, economic class, cultural or ethnic background, as equal members of one universal family. Prout is the application of family spirit in the social and economic arena.
  • Ethical lifestyle:   Personal ethics underpin all political and economic practice. A limited vision of ethics is contributing to the disintegration of contemporary society. To build a healthy society, Prout promotes the acceptance of cardinal human values.
  • Spirituality: This is the constant endeavour to maintain one’s connection with Spirit, the well-spring of hope and the source of all that is sweet and subtle in human life. Many people consider the regular practice of meditation or contemplation to be helpful in this regard.
This article, edited, from PROUT Institute of Australia website,