For years, psychologists have tried understanding the deeper reasons of why we work, what drives us and how important it is to be passionate at work. Survey after survey has revealed how the sense of purpose is what drives millennials to work and so on…However, one of the fundamental reasons we work and have to continue to, is the competitive times we live in and how important money is to sustain our lifestyles.
It made sense, then, to unearth the role of money in the context of the ‘Future of Work’. I spoke to Vivek Kaul, author of the Easy Money trilogy, and an economic commentator who is also a contributor to several leading publications. Kaul future gazes and talks of digitisation and going paperless. He shares vital insights into the history of economies, the role of the government in context of money and the financial system itself in a highly relatable format. Money, therefore, has a newer meaning and context and as we move into the future will continue to be as complex and harder to earn than it currently is. Edited excerpts:
What does the Future of Work mean to you?
Many years ago, I read several books by a British author called Charles Handy, who had then said that the future will be for what he called, ‘Independent Workers’. By that, he meant people who work for themselves; he did not necessarily mean people who set up businesses, but more so, people who fulfil certain requirements for the society and make money in the process. Now we call it the gig economy. With the uberisation of society, more and more people will join the gig economy. It is good in one way, as people can gain control of their own lives, but also bad as payments will not really remain the same. If I were to work full time, I would probably make the same amount I am making now, but my work load would probably be reduced by one-third or one-fourth of the work I do now. To that extent, while the gig economy gives you a lot of freedom, it comes with its own challenges as well.
What is the Future of Money in the context of ‘Future of Work’?
I can either give you a Bengaluru answer or the right answer.
The Bengaluru answer will be that cryptocurrencies will take over. People seem to get largely excited when we talk of technology and money.
But the fundamental point that people forget is the idea of the government. The idea of government depends a lot on who controls the money. So, if the government does not control money, what does it control? There are three things that make up a modern government:
1) The right to legal violence
2) The right to taxes
3) The right to create money
If you take away the right to create money from the government, you start questioning the very idea of government. If you go back to the history of the 20th century, the rise of democracy and the rise of paper money(which allowed the government a lot more control over money) happened almost in parallel.
So, if you think money in future is all crypto or bitcoin, it does not mean much. It might have its advantages technology-wise, but I do not see them taking over. Having said that, within the scheme of things, with the Central Bank controlling our money, the digital component will go up more and more and you will see less of paper money. It is one thing to understand the working of technology, but even technology works in the context of history and the government and it is important to remember that.
What do you think could be the various forms money could take in the future?
Up until the First World War, all the paper money in the world was backed by gold and silver. Money was nothing but a certain amount of gold or silver, which gave way, as countries needed paper money to fight the war and then the link between money and gold and silver, sort of broke over a period of six decades. The advantage of having gold or silver behind paper money was that no government could print an unlimited amount of money because you could only print so much with the backing of gold or silver. If you printed more, you were at the risk of running out of gold and silver. That controlled that amount of money the government could print. With that control melting, governments over the years have printed an unlimited amount of money, which is why we have seen so many financial crises in the last four to five decades.
This might sound like a utopian idea, but probably, for a more stable world and financial system, we could see a form of money that is backed by gold and silver. We could go back to it. But, as I said, this is a utopian idea.
In a world where gold and silver back paper money, you are basically exchange a real commodity when you pay money. Currently, when you pay paper money, there is value attached to it only because it has been decreed to be so by the government. That is one of the reasons why millionaires and billionaires like their wealth to be in hard assets. At least Indian millionaires own a lot of real estate and gold.
Where does the gold and silver we are talking about come from?
You just dig it up, there is nothing more to it.
In the current context where we exchange paper money, there is an exponential gap between the rich and the poor. How is that likely to be managed?
What differentiates the rich from the poor? The rich have a lot of capital. The capital could be land or money. The poor have to essentially save money from whatever they make. Going back to economic history, you will realise that capital grows at a much faster rate than income does. Which is why, once you are rich and have a certain amount of capital and invest that capital, you grow at a much faster rate. Which is why the rich continue to grow richer and poor continue to remain poor. That will only continue, irrespective of the future of money.
Countries like China are going paperless at a fast pace. What are your thoughts on that?
I am not a fan of 100 percent digitisation simply for the fact that it gives the government an extreme amount of control over your money and wealth. The point is, if you have paper money, ultimately, however inconvenient it might be, you have some control over your wealth. Whereas, if you do away with all forms of paper money, then the government gets tremendous control of your wealth. For the system to be balanced, there has to be some paper money in it.
In conclusion, the future of work is going to get more and more difficult, in this era where companies employ people and people spend their entire lives working for a single company. That, we all know, has come to an end. More and more people will end up working for themselves. Or we will have these large companies dominating sectors. So, if you end up specialising the way we are, we may not have too many options to move. Globally, there is a consolidation happening across sectors and fewer companies are controlling a greater proportion of the sector. Leaving fewer options open for employees. That is one part.
Then, of course, automation will play a huge role (it already does). The problem will be for those in the middle. The upper class will always survive and the lower class knows how to survive. It is people in the middle management, who will basically have a tough time. Those are exactly the jobs that are and will get automated. Those at the top have more thinking jobs and those at the bottom, in an Indian context, like a maid servant – will exist, despite all the automation. This is not so common in India, but all over the Western Europe and in the US there are institutions that take care of the elderly. Again, it is a low end job, but it cannot be automated. Anyone who works in front of a computer all through the day, should essentially feel threatened.
Published Date: Mar 27, 2019 04:03 PM | Updated Date: Mar 27, 2019 07:03 PM IST