Letters: Who's to blame for inflation?

Addressing the conference “FI Inclusion Day” in New Delhi Union Home Minister P Chidambaram for the first time spoke like an outspoken economist. There could be many causes for inflation, but the most important one is rising wages.

Disproportionately high wages of executives in mega or even middle-sized industrial houses clearly indicate who is guilty. It is high-paid executives and price index-linked organised sector employees who are to be blamed for inflation. There is a need to fix maximum compensation on a par with the appropriate gap between the lowest paid and the highest paid in companies that earn huge profits and dole them out to “elite” employees. This is being done through “arbitrary fixation of prices” not only in real estate but also in manufacturing and services. There is a need to force companies to curtail costs especially for its manpower.

Finally in the total circle of manufacturing of all inputs it is the cost of wages and prices of products that would depend on the wage level. Reduced wages will increase profit. And the government will be saved from putting money in subsidies and bailouts. It will reduce the burden of the rising cost of administration. But who will do it? The government is controlled by industrial houses and the representatives elected by the common man are more interested in accumulating wealth at a fast pace.

B B Jindal, on email