On Poona... And The Planner

One interesting story in the news today comes from Pune (I prefer Poona).

It says that the per capita income of the city is more than 50 per cent higher than the per capita income of India as a whole. Why so? Since there are no statistical laws, the answer must be found through the laws of Catallactics.

But before that, let us note at the outset that this statistical information points to the fact that the “population causes poverty” school is dead wrong: the density of population in wealthy Poona is much, much higher than vacant Jhoomritilkaya. Why then is Poona richer?

As Adam Smith pointed out in the very first chapter of the Wealth of Nations, “the extent of the division of labour is determined by the size of the market.” Since the market is bigger in Poona as compared to Jhoomritilaiya, because of higher population density, there are more specialized niches in Poona’s market. You can be an auto-rickshawallah, receptionist, plumber, electrician etc. in Poona. These opportunities for survival are not available in any of the sparsely populated “self-sufficient village economies” that Gandhi idealized.

Thus arises the primary “conflict of visions” between India’s libertarians and the socialist-Gandhians: We see the future of India as a nation of over 500 free trading and self-governing CITIES, plus another 5000 or so similar TOWNS.

The “free trading” character of these cities and towns is essential to our idea, for this will result in an “international division of labour,” which will not only raise incomes further, but also create even more specialized niches: take that, K Nut.

Equally relevant to our idea is the vision of hundreds and thousands of cities and towns. India today has just 5 cities for a billion people. 65 per cent of urban Indians live in these 5 OVERCROWDED cities. The USA has 350 million in over 200 cities. We must spread out over the vast landmass. Our 2500-mile long coast should see many more new cities mushrooming in a free trading environment.

Poona today is OVERCROWDED – and this is not because of the “population problem.” The cause is poor transportation. I lived a few months in Poona some years ago, and the transportation system there seems to have been designed by the Society of Indian Automobile Manufacturers (SIAM): it is chock-a-block full of auto-rickshaws and two-wheelers. This choked traffic forces everyone to live close to work – causing all the overcrowding.

Yet Poona was till recently a pensioner’s paradise. It was one among a chain of “hill stations” the British developed on the Western Ghats that were organically linked to Bombay, their primary city. The Poona-Mahabaleshwar belt of hill-stations was of a pattern that the Brits followed in every primary city – like the Simla-Mussoorie belt linked to Delhi. Or the Darjeeling-Shillong belt linked to Calcutta. And the Ooty-Kodaikanal belt linked to Madras.

So, apart from the coastal cities, we should also develop thousands of small towns in our hilly regions. This requires a focus on transportation.

And here, as usual, our “central planners” have got it all wrong. The “Golden Quadrilateral” Highway Project (which is stuck in red tape) is a 5-city vision.

The 500 cities and 5000 towns vision requires: first, twin expressways along the coasts; and second: “hubs-and-spokes” expressways leading out of the primary cities into the surrounding satellite towns, both old and new.

The Bombay-Poona expressway has been a boon to Poona: it is an example of a “spoke”. We need thousands of such spokes linking each of the 5 metros to their surrounding satellites.

We began with a statistic which we interpreted with an old catallactic law. The “planner’s” problem is that he is not in possession of these essential laws with which to interpret all the statistics he collects – and spends a huge amount of our money on. He is thus stuck in a world of government welfare schemes for the rural poor, “model villages” and other such crap.

Sack every planner.