Shouldn't waste his genius, should he?

"Is it true then that the Indian economy is headed for a serious crisis? asked Dr S Swamy. "Yes, that is a reality." Why? "One, the growth rate of the economy with proper index number-based GDP has declined over the last two years." The economy grew by a scorching 8.2% in the first quarter of this financial year. The base year for calculating GDP growth was shifted to 2011-12 from the earlier base year of 2004-05. Because of this change "India's data is puzzling and is prompting economists to find a workaround", wrote V Beniwal. "The economy's fastest expansion in more than two years in the June quarter was predicted accurately by only one of 44 economists surveyed by Bloomberg." Even as economists are trying to understand how the present data compare with the past the base year will be changed again to 2017-18. Household savings have dropped from 34% of GDP to 24% in 2017, non-performing assets in banks have risen sharply, infrastructure investments have been cut, manufacturing, especially in small and medium industries are growing at a meager 2-5%, the agricultural sector is suffering because of low prices and crude oil prices have risen from low levels, wrote Swamy. Swamy recommends that "the individual has to be persuaded by the government with incentives -- for example by abolishing the income tax" and "lowering the cost of capital via reducing the prime lending interest rates of banks to 9%, by shifting to a fixed exchange rate regime of Rs 50 to the dollar for the financial year 2019 and then gradually lowering the exchange rate for subsequent years". In a poor country like India abolishing income tax will result in an explosion of indignation because income tax is seen as progressive. People feel that it is only fair that the more you earn the higher should be your rate of tax, because the poor spend most of their income on essentials, such as food, and rent, while the rich spend a much smaller portion of their income on basics. The poorest 20% of the population in India spend 53.27% of their earnings on food and beverages, while the richest 20% spend only 11.88%. Conversely, the richest 20% spend 38.69% on housing, compared to a paltry 5.62% by the poorest 20%. If income tax is abolished the government has to increase indirect taxes which are based on consumption and hit the rich and poor equally. The share of indirect taxes is already considered too high in India. The Hong Kong dollar is linked to the US dollar and so the interest rate in Hong Kong varies according to rates set by the Federal Reserve in the US. No Indian politician will dream of giving up control on monetary policy. Dr Swamy is some kind of a genius with a PhD in Economics from Harvard, so why does he write such impossible things? Maybe, because he has a reputation of being a maverick and it is not easy to maintain such a reputation. He is wasting his genius.