PROUT - AN OVERVIEW
Prout (an acronym for Progressive
Utilisation Theory) is a social and economic treatise first
proposed by the eminent Indian philosopher, Shrii
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’.
- Prout draws on ecological,
social and spiritual wisdom accumulated as a result of thousands of
years of human struggle and experimentation.
Proutist economy is based on the cooperative
system. It is community based, decentralised and promotes an
economic voice for all. Prout espouses
meeting human needs by promoting the maximum utilisation and rational
distribution of all resources: physical, mental and spiritual.
- Prout also promotes a global society based on the concept of political
centralisation (legislature, executive, judiciary) followed by
levels of government down to local government, and economic
decentralisation built predominately on cooperatives (no
centralisation of economic enterprise in private hands or
nationalisation of enterprises).
- Prout has a theory of psycho-social class (not based solely on
economic relations) and a historical analysis based on the concept of collective
The primary social 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 bio-region in which it is embedded.
Therefore, Prout opposes the neo-liberal agenda
of deregulation because common community standards in respect of
enterprise, transactions and resource use are necessary in the production
and distribution of goods and services. Concentration of wealth in the
hands of a few and the centralised economic power they obtain bleeds 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:
o all persons have the
right to obtain their minimum requirements of life, in particular food,
education, health care, clothing and housing.
After that, the
economic principle is that surplus wealth be distributed as determined by
the community values of the day, in 2 streams:
o to meet common amenities that everyone requires above their
minimum necessities (e.g. essential goods like refrigerators) or to meet
universal service obligations such as electricity, communications,
o to provide special
amenities or incentives on a merit basis to enable persons to render
service to society or apply their skills and knowledge for social good or that
are necessary for research and development or innovation.
Prout also promotes a
system of cooperative finances and budgets to determine the distribution of
profits from cooperative enterprises on a rational basis so that workers
and/or shareholders and other stakeholders all receive a fair distribution.
Similarly, annual aggregate incomes going to households, businesses and
governments require rational distribution so as to ensure, and increase,
overall social welfare.
NEW DEFINITIONS OF ECONOMIC PROGRESS
capita Gross Domestic Product (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.
that human beings are not just homo economicus.
We have intellectual, emotional, cultural, social and spiritual needs in
addition to the economically obvious physical/material 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.
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 (financial, social,
environmental, etc) 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 (quality of life indicators) and others.
Production taxation: Prout supports shifting the tax base by
gradually replacing personal income tax with a rational system of taxes
levied from the starting point of production (with no tax on essential
commodities) and in respect of the value added and wealth generated
Economic democracy is achieved through:
2. a cooperative based
significant voice for all women and men in economic planning and decision
Local communities can solve local economic issues 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 and the easier implementation of economic measures.
There are 5 principles
for achieving economic decentralisation:
1. Local people should have control of local resources.
2. Production should be guided by local consumption needs and not
3. Production and distribution should be organised through the
4. Local people should have employment priority in local
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 or producing
non-essential goods can operate as 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 service sectors all develop in balanced proportion.
Here ‘agro’ refer to pre-harvesting industries, and ‘agrico’
refers to post-harvesting industries.
A cooperative economy will also
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.
GLOBALISATION AND GOVERNMENT
In the long term, Prout envisages
the establishment of a system of tiered communities governed 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 on a
national and international scale. 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 standard set of laws
for all global citizens and a governmental structure for assisting the
Prout promotes the concept
of political centralisation and economic decentralisation.
This approach can make ‘globalisation’ work for all.
To ensure community input into government, social boards
should be formed parallel to different levels and departments of the
governmental structure, such as organised labour movements, professional
bodies, environment advocacy, intellectual and welfare associations and
movements that hold representative government to account. Social boards
should also oversee the functioning of cultural, scientific, educational
and other institutions that serve the public good.
The guiding principles and policies of the mass media should
be framed by the community, with community representation in media
enterprises, and support of media diversity, local content and meeting of
HOW WILL IT HAPPEN ?
The contemporary world is threatened by three main sources of
First, economic instability arises from gross
concentration of wealth in a few hands, leading to misutilization
and irrational distribution of resources, and which generates speculative
bubbles, most obvious today in the equities, futures and foreign exchange
markets. All speculative bubbles inevitably burst.
Second, the flip side of wealth concentration is institutionalised
poverty encouraged by the absence of economic democracy. So the second
source of instability is social instability, which in the
worst case is expressed as violence and war.
Third, another 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. The rise of disgruntled intellectuals, activists and others
fighting for social equality and inclusion continues its pace raising
people’s consciousness and inspiration for ensuring social change.
According to Prout, societies
transform themselves through dialectical struggle. The existing order (thesis)
in decay is gradually or rapidly replaced by progressive ideas (antithesis).
The antithesis to capitalism is already emerging. After that comes a synthesis,
or new thesis, and so on. Civil society including community, women’s,
workers, indigenous, artists, green and other activist organisations all
over the world are setting the agenda where large business corporations and
governments have failed.
important lesson learned by political and social activists in recent
decades is that social change requires personal change. Outer change must
be accompanied by inner change. Keeping this in mind, three kinds of
personal transformation are essential:
· Universal outlook: the struggle to
accept all women and men (and children), 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 practices. 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 a feeling
of Oneness with the universe and all its expressions, 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.
Cardinal human values
are those which reflect the spirit of continuing efforts towards welfare of
the entire humanity and promotion of universal well-being. They elevate
humanity and include love for all, benevolence and responsibility to ensure
the welfare of all entities in the universe.