Kejriwal Explains The Economics Behind Freebies And It Makes Sense - Viral Bake
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Kejriwal Explains The Economics Behind Freebies And It Makes Sense

Delhi Government has often been criticised for distributing freebies to the people of the Union Territory both by the opposition and even the citizens. And as Delhi Elections inch closer, the criticism has risen.

The opposition has hit out on Aam Aadmi Party saying that Delhi, this time around, people won’t be lured by AAP’s “power and water freebies” and would rather vote keeping “safety and development” in the mind.

Taking a jibe on the comment, Kejriwal took on Twitter to explain the economics behind freebies and how it has benefited the Union Territory.

Kejriwal wrote that freebies ensure there’s always some extra money in the hands of poor people so they can buy extra goods. When people buy stuff, this creates a demand in the market thus ensuring income for the sellers. Make sense? Abouseltly.

Centre Tracing Delhi’s Footsteps

India’s Economy is currently ailing because of a lack of demand in the market. Lack of demand means a lack of investment, which eventually has lead the country towards an economic slowdown. In that scenario, Kejriwal freebie logic seems to work just fine.

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Notably, if you try to understand, the Centre seems to be tracing Delhi government’s footsteps. The Centre government is mulling to cut the tax that a citizen pays in the upcoming 2020 budget to allow them some extra money in hand. The extra money may inspire people to buy more and create demand. And cutting taxes is also a kind of freebie.

Aam Aadmi Party freebie
Source – Hindustan Times

Also, the fact that the Delhi government, despite giving freebies, has maintained a budget surplus is yet another reason to trust the scheme. However, if we aim for national implementation of the freebie schemes, the consequence could vary.

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Notably, the AAP government currently provides free services like free-bus rides for women, no electricity charges of up to 200 units, free WiFi, free pilgrimage for senior citizens and waiver of development charges for new water and sewer connections.

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