What use is education without learning?

"For the last three decades economic pundits of all hue, most of whom cited China and its apparent economic miracle, have fed us the line that the only thing that matters is economic growth," wrote A Padmanabhan. This push for growth was financed by reckless borrowing by companies which they are unable to repay, leaving lending banks with a mountain of non-performing assets. Companies cannot borrow unless they clear their debts and banks cannot lend until they clear their books, known as the 'twin balance sheet problem'. "The deterioration in asset quality of Indian banks, especially that of Public Sector Banks (PSBs), can be traced to the credit boom of 2006-11 when bank lending grew at an average rate of over 20 percent," said Governor of the Reserve Bank (RBI) Shaktikanta Das. "Worse this growth left little trickle down for the bottom of the pyramid; the 1% just simply became richer." Padmanabhan recommends "redistribution", with higher taxes on the rich to fund social schemes for the poor, such as MGNREGA, free electricity connections and cheap housing. This will improve rural demand and, hopefully, will stimulate new investment. This is known as 'tax and spend' policy and has been extensively studied by economists. An analysis of direct taxes paid by Indians showed that "the top 5% of effective tax-payers in the country, equivalent to 0.1% of the country's population, contributed nearly three-fifths of India's income-tax collections. And the top 1% of effective tax-payers, equivalent to 0.03% of the country's population, contribute roughly a third of India's income tax collections," wrote N Kwatra. "In fact, India's personal income tax collection as a share of its GDP, at 2.5%, is higher than that of countries such as Vietnam, Bangladesh and Egypt and comparable to that of the Philippines." The government sharply increased surcharge on incomes above Rs 20 million in last month's budget. The stock market index the Sensex fell over 2% as foreign portfolio investors (FPIs) were also included in the surcharge, but jumped over 600 points on rumors of the government having second thoughts on taxing FPIs. The government has the power to increase taxes but cannot stop the rich from fleeing India. Officials claimed that top rates of taxes are higher in the US but the rich are fleeing to the US and Australia. It's not just high rates but the hostile treatment of taxpayers that is driving out the rich. East Asian countries grew rich by supporting their workers while social welfare was left to families, wrote Ruchir Sharma, whereas in India the "government is suspicious of the private sector" and elections are fought by competing on social schemes. China lifted 800 million people out of poverty by growing the economy and not through "redistribution". Maybe the reason we remain poor is because we refuse to learn. What use of education?