8 SOCIAL SCIENTIST power from the working class and employees by way of compulsory deposits of additional dearness allowance and wages, delay in dearness allowance payments, attack on bonus, huge taxation on all sections of the people including the rural masses, higher transport rates, electricity charges, petrol prices, bus fares and so on, all in the name of bringing down the price level. The price level did not come down—only the rate of rise did—but the purchasing power of the people was drastically reduced. People had to purchase at virtually the same prices with reduced incomes. It was an open invitation to demand slump and recession. In 1974-75 alone, the central and state governments together raised taxes by more than Rs 1000 crores. The central taxation measures including increased railway fares, freight rates and postal rates amounted to an additional taxation of Rs 690 crores in 1974-75 and R& 935 in a full year. The additional burdens imposed by the state governments amounted to Rs 358 crores8. The resource mobilization efforts were further reinforced by another set of measures designed to mop up additional purchasing power: impounding of one-half additional dearness allowance and almost all of any other wage or salary increase (along with ceiing on distributale profits and compulsory savings for taxpayers in the higher-income brackets.) The compulsory deposit of additional dearness allowances and wages alone involved withdrawal of more than Rs 200 crores of purchasing power. The ordinance which reduces the bonus from 8.33 per cent to 4 per cent deprives the workers of another Rs 200 crores. The government, which is thus directly responsible for the recessionary spate of layoffs, closures and under-utilization of capacity, went ahead after promulgating the bonus ordinance to remove the ceiling on distributable profits in order to ^encourage investment". Is it not obvious who is being made to pay the price for the official attempts to get out the crisis? What has become unmistakably clear is the failure of the capitalist path of development in a world situation where capitalism itself is on the decline and colonial expansion as an outlet for industrialization is no longer possible. The bourgeoisie in the leadership of a national movement, for political reasons, is forced to compromise with fedual reaction at home. And such compromise necessarily means a compromise with imperialism abroad. 1 K N Raj, "Growth and Stagnation in Indian Industry", Economic and Political Weekly, Special Number, February 1976, p 223. 2 Charles Bettelheim, India Independent, Monthly Review Press, 1968, p 236. * Reserve Bank of India, Annual Report and Trend and Progress ofBanking in India, p 13.