On Jungle Drums... And Pretty Boys

Just the other day I discussed a peculiar schizophrenia my perpetually stoned, simple-minded chillum-yaar suffered from. If you recall the tale of Guru, his precise error lay in suggesting “good things” for The State to do. He said: “Why don’t they clean up all the pollution in the Ganga and the Jumna instead of putting bamboos up our backsides?" It took me time and effort to cure him of this delusion, and that story can be read here.

However, today, the venerable Times of India seems to be suffering from this very same mental affliction. Their lead editorial, on the Maoist-Naxalite uprising, is titled “Carrot & Stick.” There is a sub-title too, on the paper but unfortunately not on the webpage, which goes, “Fight Naxals with both guns and development.” These eminent editors, all very learned men, seem to believe that “development,” which is something “good,” can happen from State action. A great delusion indeed. I am reminded of a paper I presented at the very first Freedom Workshop of Liberty Institute some 15 years ago. It was titled, “Bauer Power: Getting The State OUT Of ‘Development.’”

What, indeed, is “development”? And what is the “Role of The State”? The way all classical liberals viewed these issues, from Adam Smith right down to Ludwig von Mises, is that The State is nothing but an instrument of compulsion and coercion, to be exercised only upon the lawless, and, that too, in full accordance with the law and “due process.” The State to them was but magistrates, policemen, judges, jailors and hangmen. How can such an institution – and they all believed it was a vital institution – employing such personnel, achieve “development”?

To all classical liberals, “development” was something DIY. You had to “Do It Yourself.” Individuals, under the “system of natural liberty,” were to develop themselves, through hard work, enterprise, and all the good and great virtues. It is to The Market they all pointed. And they all called for Liberty for this Market: Liberty From The State.

Adam Smith was a staunch Whig in his politics. The Whigs wanted to curb the powers and discretions of the King; to set the markets free; to put and end to all monopolies, restrictions and privileges; to freely trade between national borders unobstructed by States – and thereby put an end to ruinous wars. They were certainly not worshippers of The King.

Adam Smith admired the republicanism of Geneva – and even visited this fair city to breathe its free air for himself. Smith and Hume took an interest in Rousseau, the great democrat – but he turned out to be quite a bum. Yet, I daresay that if Smith could see the modern world, mass democracy â la Rousseau, with legislation, legislation and even more legislation, restrictions, restrictions and even more restrictions, rampant protectionism and perpetual wars, he would emerge shell-shocked. For people like Smith and Hume, and all those who believed in Liberty, had an abiding faith in progress. Looking at our Rousseauesque tyrannies, Smith and Hume would have been forced to concede that we moderns have not progressed at all. Technology, yes; but in politics, no. And let us not forget that technology was progressing rapidly in their time as well, for James Watt developed his steam engine, which powered the progress of the entire 19th century, in a workshop within the University of Glasgow, while Smith was Professor of Moral Philosophy there.

The real reason for this retrogression is just this: the grave error of expecting that The State, with its guns, can also achieve “good things.” What good can violence ever achieve? Sure, the State, which is nothing but an institution of coercion and compulsion, can ruthlessly suppress all dissent – the “stick” the editors so gleefully and carelessly recommend. But what of the “carrot”? That can only come from The Market.

This grand delusion is widespread in India, so there is nothing to be ashamed of. After all, the University Grants Commission, of which Chacha Manmohan S Gandhi was once chairman, doles out mammoth funds – “carrots”? – towards teaching us that the Role of The State lies in occupying the “commanding heights of the economy.” To our State professors, like those who taught me, and those who are still teaching our kids, the affairs of entrepreneurs, investors, traders – indeed, the day to day affairs of humanity – are best directed by an institution of coercion. We must all rue the day when this pernicious philosophy was unleashed upon our minds. And it is this error that today’s lead editorial in the Times of India suffers from.

If my reader wants to permanently cure himself of this dreadful mental disease, the alpha and the omega of Statolatry, which is the worship of power, I suggest Bastiat’s short and humorous essay, “The State.” It is here that he offers his famous definition of this peculiar beast:

The State is that grand fiction by which everyone tries to live at the expense of everyone else.

The editors say that The Chacha State is “planning to pump in big money for infrastructure projects in Naxalite-affected districts.” This is their famous "carrot." This funny money will go to its clients. It will come from us. Some will continue to live off others. Parasitism. No “carrot” at all.

Let us say a loud “NO” to such dreadful ideas. The great goal of “development” has nothing to do with the institution of The State – even if it was the most perfect and law-abiding State ever to have been constituted, entirely staffed by very honest and sincere personnel, which our Chacha State most certainly is not.

As far as the “development” of these poor forest-dwellers is concerned, the editors note what has actually transpired ever since the Brits were chucked out and the CONgress took over. They say:

Tribals have benefited the least from the Indian state and its development policies. Worse still, their lands and livelihoods have been ruthlessly destroyed over time.

Note the term “development policies.” Quite obviously, these ideas are all cock-and-bull. There is a huge mass uprising underway. The editors mention that the rebels “waylaid a train near the West Bengal-Orissa border.” They omit mentioning that this was the prestigious Rajdhani Express, the flagship of the Indian Railways. Not only are they not “getting the message” being tom-tommed by all the drums in all our deep and dark jungles, they are also playing down that message. They are playing ostrich. And their concluding para really shows how deep in the sand their heads are buried:

Naxalites, or anyone else for that matter, do not have the licence to take up arms. Rule of law is a prerequisite not just of democracy but also of development, both of which are negated when armed militias rule the roost. Anyone who breaks the law, whatever may be his motivation, must pay the price. The only way for Naxalites to have a place in this country is to play by the rules of our constitutional democracy.

Oh yeah? Illegal guns flourish throughout India. And all of us break laws, having no respect for them – like the prohibition on ganja, which I proudly and publicly break every single day. Lawlessness is rampant throughout India. Further, and most importantly, it is the State Police who are fundamentally “lawless” – and this implies that there are no “constitutional checks” on State powers. Now, when masses are revolting, these pretty boys find it all too disgusting, as it disturbs their happy make-believe in which the Chacha State is in heaven and all is well with the world. Sitting in their poky little air-conditioned cubicles on, most appropriately, Bahadur Shah Zafar Marg, they declaim that these rebels from our deepest and darkest jungles have “to play by the rules of our constitutional democracy,” failing which they will have “no place” in our society. As if they have a “place” today. To have a “place” means Property, stupid!

Anyway, I am proudly on the other side. We need more and more rebels. We must shake up The Chacha State. I am extremely happy that these poor, illiterate, and systematically oppressed forest-dwellers have shown the GUTS to take on our Chacha State. I wish them well. I have no sympathies for our The State. They must hear the grievances of the people and redress them. This requires “politics,” not guns.

Get MY Message, Dude?

Jug Suraiya has written a very thoughtful piece today on something we have also discussed at length in this earlier post – the Naxalite-Maoist armed rebellion. His title, “Leftists and Left-Outs,” says it all: Leftists like the Karats, Yechuri, the entire Politburo – they are very much part and parcel of The Total Chacha State. Karat insists that “Maoists are not leftists.” Certainly not, quips Suraiya – they are “left-outs.”

Ha ha.

Heck, so are all the rest of us. Even right here in New Delhi, a brand new city, where THEY live in British-built bungalows with acres of verdant State-maintained lawns, laid out with sprawling roads in a “hub-and-spoke” design, wide footpaths, leafy avenues, clean air, birds and birdsong, and what have you. And, of course, great “VVIP Security” too, to keep them safe.

The rest of New Delhi has been “left out” of such a well-designed urban layout. Although there are millions of acres of totally unowned land all around New Delhi, our homes are tiny, our roads are a mess. If some foolish people take comfort in the market values of their properties, they also must look around their properties to the city they live in, and realize that they own hideously expensive properties in a truly hideous town.

Suraiya’s article, which I recommend highly, talks about how the Central State Police uses its guns to dispossess forest-dwellers so that State-licensees can mine on land they do not own. Singur, Nandigram, same old story. No Respect For Property. Unlaw.

The Maoists shot dead 4 of these cops. A spokesman of the Central State Police Ministry is quoted as saying:

“"What is the motive behind the attack...? What is the message that the...(Maoists) intend to convey?"

Suraiya uses the term “perception” while employing this quote. Indeed, what does this bozo PERCEIVE? Just the other day a police inspector was beheaded. Just the other day they killed 17 cops in one go. Just yesterday, they hijacked the Rajdhani Express. And the fucking stupid bozo from Laputa-On-High still doesn’t get the “message.” He sure has his ear to the ground.

The King of Laputa, of course, has all his senses completely devoted to economic (mis)management. He wants to occupy the "commanding heights of The Economy." Quite naturally, here too the news is not good – inflation, talk of an “exit strategy,” the problem of the huge deficit – all of which should tell the “Sheeple” that we are quite literally being “fleeced” for this great big party THEY are having on the floating island of Laputa, a party from which all of us, like the Maoists and the Naxalites, have been “left out.”

Jug quotes Arundhati Roy too – but what I took away from his piece is this thought:

Who are the State Police?

I have just returned from a long drive around south Delhi, and I think all of us here know that the State Police have never given traffic safety any thought – ever. This is true throughout India. 1,30,000 people die annually on our roads, or over 350 a day.

What “work” do the State Police in New Delhi do, other than VVIP Security for all the Laputans?

If we ask ordinary people on the streets of this Capital City, the poor, the marginalized, the really and truly “left out” people of New Delhi, they detest the State Police even more strongly than the Maoists do, I daresay.

Anyway, I was stuck on the Bus Rapid Transit Corridor (BRT) for quite a while. The central lanes, reserved for buses, were empty. While we the “left outs” were jam-packed on the left lane, struggling to get ahead.

Struggling to get ahead.

It was then that I saw a lone white Ambassador car, the 1954-vintage English car that is the Flagship of the Chacha State, their "Trabbie," with a red light on its nose, and myriad long radio antennae sticking out of its ample behind, so that its occupant can instantly receive all messages from without, driving grandly down the vacant bus lane, breaking rules which the Sheeple are following, precisely as in the case of Property.

I stuck my right hand out of the window and held it aloft, middle finger extended.

Simple message.

From "a simple, separate person.”

Hope the blind, deaf and dumb on Laputa get this at least.

Another Ugly, Corrupt, Exploitative MONOPOLY

Mint has come up with an extremely important editorial today, on delays in the judicial system, and their huge economic and social costs. The marginalization of our poor people begins here, they say; this is why the poor take to extremism. All extremist groups operate kangaroo courts. This has increased the costs of policing, and the budget of the police has risen by 25%, they add.

I read an informed article in Manushi once, on the rise of the Shiv Sena in Mumbai, which traced their success precisely to the failure of the justice system. The Shiv Sena delivered justice to ordinary Mumbaikars, which the State courts failed to do.

However, our judicial system also soaks the rich. The editors say:

…poor contract enforcement is ensuring that investment decisions now have risk premia that factor in judicial delays. As a result, the cost of borrowing capital goes up: Many investments that would have been viable become unviable due to these delays.

I daresay the entire logjam is designed to raise the flow of “speed money.” This is typical of any exploitative monopolist. The only solution is to break the monopoly. Let there be other courts that can compete – a “private law” system. The editors of Mint say “it is important that there be alternative mechanisms to resolve disputes.” Professor Robert Cooter, author of the excellent textbook on Law & Economics, personally informed me of the “Rent-a-Judge” companies of California. Disputants choose their own judge. He decides fast and has an incentive to be fair and just – otherwise these parties will not accept his verdict, which he cannot enforce; and, further, he will never get business again.

While my reader wonders about the possibilities of market justice, the southern Express carries not one, but two, stories on judicial corruption at the highest level. These refer directly to the chief justice of the Karnataka high court: one, to his benami properties; the other, to improper and biased decisions favouring his associates.

So our choice should be clear: It is either rent-a-judge or these corrupt monopolists feigning to be possessed of the sublime quality “just.”

Once again, it must be emphasized that the real fault lies in deep philosophical errors. As in Economics, as in Sociology, so also in Law, the evil doctrines of “positivism” have obscured all understanding and appreciation of natural laws. Once again, because of this evil doctrine, in all these important disciplines, a class of “professionals” has emerged, all self-regulating, and all in one way or the other benefiting from The State. The profession of Law is one such parasitic profession. Lawyers become judges, lawyers teach law, and lawyers all start off as private entrepreneurs. The rest of society must therefore see this bunch of black-coats as part and parcel of the overall monopoly, exploitative of the populace, ignorant of the true principles of Law. The only real solution is to treat them all as private entrepreneurs, forcing them to compete in the provision of legal services in a free market, without any supports from The State. Specifically, no more positive law, which increases litigation, thereby benefiting lawyers. We must move to a “private law” world.

It must be remembered that most of us go through life without ever visiting a court or a police station. Most business is based on trust. Our day to day transactions never lead us to the courts. There are natural laws at work here – but legal positivists understand them not. We are extremely fortunate that Friedrich Hayek escaped from the clutches of this evil doctrine, for his own professor of law, Hans Kelsen, was a major positivist. Hayek’s later views on law and legislation were influenced deeply by the great Italian legal philosopher, Bruno Leoni, a truly astounding classical liberal scholar, and, like Hayek, not a product of Anglo-American education. Hayek was a lucky man, indeed, to have escaped the clutches of legal positivism.

However, all this reflects on the character of the Total Chacha Manmohan State. Do they deserve the title "State" at all?

Of course, the Honourable East India Company ran its own courts in its Indian cities, and through its territories. It was because of the better justice and respect for property there, under EIC rule, that Calcutta became the greatest city of Bengal, displacing Murshidabad, the Nawab's capital, where justice was notoriously arbitrary. There are no scandals in the history of the East India Company's judges. And Sir Elijah Impey was libelled by Macaulay in his History, so the standard story of the Nuncoomar case which features Warren Hastings as a judicial murderer can be seriously disputed. Let us not forget that the British parliament was finally forced to exonerate the great Hastings from all charges that had been levelled against him; that too, after a long and protracted trial.

There is a story I read of a ruler of one of the princely states in the 1940s which tells of how he ran his courts. He had hired an eminent retired judge to visit his capital and decide all appeals once every fortnight. As for the lower courts, all delays in delivering judgements of over a fortnight resulted in a cut of pay for the judge. The maxim was that even a flawed judgement is better than a delayed one. This ruler was then interviewed in the 60s, when he laments what has happened since the Chacha Nehru State took over: undertrial prisoners languishing in jail for years, and court cases that never ever come to any conclusion. Lawyers, of course, keep earning their fees. And they alone can become judges.

Break this monopoly!

Guru Finds A Guru

Guru and I smoked a great chillum last morn, after which he said something wise. Simple stoners are known to do such things quite often. He said:

Saab ji, is desh mein bas Bhola ka naam hai, unka kaam nahin hai. Sadhu-mahatmaon ko bhi charas nahin milti. Hamara kya hoga. Hum tho chhup-chhup ke peetay hain.

He asked me to convey this message of his to the world. So allow me to translate:

Sir, in this country Bhola exists only in name. Reality is starkly different, where He does not exist at all. Here in Bhola Country, even our holy men cannot obtain the Noble Herb. What will happen to us? We must hide and smoke.

[Bhola is the nickname of Lord Shiva, the Destroyer, the greatest god of the Hindoos, who legend holds was much addicted to cannabis. Bhola means "simpleton." There are many, many funny stories of The Destroyer. Whenever a Hindoo lights a chillum, he offers a salutation to Bhola. There are thousands of these salutations. There is no word in either Hindi or Bengali for “Cheers!” – a salutation for a glass of alcohol.]

Well said, I thought, and offered him some wisdom myself. I said that the problem is that we think of Law as something that emerges from the noisy deliberations of some 500 or so “elected representatives” of the masses crammed together in a room called, fittingly, the lok sabha; "lok" meaning masses. 500 people create a new law, indeed, they manufacture new laws every day – and all these new laws are binding on 1000000000 people. Law is brute force. We are ruled not by Law but by brute force.

This is not how Law has ever emerged in the past, I told him. And Law comes always from the past. That is why we value customs and traditions. English law was never written, but always based on local customs and traditions. Law was never "made"; it was "found" - by a discovery process involving the search for decisions in similar cases in the past. This requires serious private scholarship, not noisy parliamentarians.

It is Law that is our biggest problem I told him – and The State teaches all the Law. He seemed to have got my drift, and nodded sagely.

As an aside, these elected representatives should only be allowed to enact “public law” – binding only on the departments of The State whose budgets and activities they are supposed to administer – in the interests of the commonwealth. In India, it is these who are lawless in the strict sense of the term. They are 99.99% “misproductive.” And the lok sabha dictates the lives of all us private citizens instead.

Getting back to our stoned conversation, Guru, like all simple stoned people often do, then said an extremely stupid thing. He said that The State should be asked to do useful things. Why can’t they clean up all the pollution in the Ganga and Jumna instead of shoving bamboos up our backsides? he asked. It struck me Guru needed a guru himself, so I proceeded to cure him of his schizophrenia.

I said: Guru, we cannot expect anything useful to happen from the efforts of The State. It is not The State that is causing the pollution. It is ordinary people, mainly businessmen. They must stop it themselves, under the pressure of public opinion. If we ask The State to do it, we will be asked to pay more taxes, then The State will set up a big baboo department – and things will only get worse for both the Ganga as well as the Jumna and, who knows, perhaps the Saraswati too. Get it, dude? I asked.

It was cheering to see his wide-eyed enlightenment. So I continued to press the point. This applies to education too, I said. If we ask The State to solve the problem of illiteracy, they will extort a new tax, set up baboo departments – and nothing will happen. Illiteracy is a problem among the people. They must cure themselves of this disease through their own efforts. He was grinning widely by now, and there was a dull glimmer in his bloodshot eyes.

Actually, this also applies to endemic violence in parts of India, where people are calling for The State to create order out of chaos. Ultimately, there will always be parts of the world where violence is the norm. It is these people who must opt for civilization. Only then can they be possessed of “civil government.” Only then can they have “local self-government.” Think about that.

Guru seemed to have drifted away, lost in thought, and this also happens often to simple stoners, but I dragged him back to our conversation, thereby driving the lesson home. Alakh! Khol de Teesri Palak!

I said, Guru, there are two kinds of ships on the great oceans. One kind are run by businessmen. They ferry passengers and cargo from here to there. They charge for services rendered. The other kind are pirate ships, who loot the merchant ships. Our The State is one such pirate ship. Nothing good can be expected of it. They are, quite literally, "good for nothing."

Indeed, this is ultimately the result of grave philosophical errors – errors so deep that we have no idea any more as to what is good, what is evil, what is Law, what is a public assembly meant for. We don’t even know what money is.

Anyway, it was nice meeting Guru after a long time. The charas he so generously shared with me lit up my head alright. That too in the morn, when it is best. And one good turn deserved another.

Journalism: Good and Bad

In their Sunday columns, both Vir Sanghvi and Gurcharan Das have focused on the Maoists, but while Sanghvi’s piece is realistic and balanced, Das sounds like an apologist for the regime, a chamcha, one who is calling for strong State action.

The Maoist-Naxalite rebellions in one-third of the vast territory is an important issue today. They recently beheaded a police inspector; they shot dead 17 policemen in another skirmish; and in Bengal they secured the release of 23 of their jailed comrades in exchange for one policeman they had captured. I just read somewhere that a pitched gun-battle is now raging in Lalgarh. The situation is extremely grim.

Let us begin with what Vir Sanghvi has written, in a column titled “Let’s listen to common sense.”

Sanghvi begins by outlining the contours of a broad consensus among the urban middle class on Maoists and Naxalites. The first point he notes is that we all hold that “Naxalites lie on the margins of our society.” Further, that “they have been shamefully neglected by the Indian State.” He follows this with a damning statement:

“Indian politicians have treated adivasis and others like them with a neglect that borders on contempt, taking the line that they are too weak to protest and can, therefore, be forgotten about.”

He goes on to make another damning statement:

“We understand what this protest is about and we recognise that the Indian State has failed.”

Sanghvi calls for a return to peace, the rule of law, a redressal of wrongs. Sounds like common sense and balanced journalism to me.

Gurcharan Das talks a vastly different language. The title of his column is blunt: “No ifs and buts, defeat Maoist violence.” There is no subtlety in the message of the author of a recent book on the “subtle art of dharma.” He is calling for strong State action against those people who are at the “margins of society.” He believes they are “terrorists.” However, it is this second para of his that somehow does not ring true. He sounds not like an independent thinker, but like a shill for the regime:

[Arundhati] Roy thinks that India pretends to be a democracy in order to impress the world. I think our democracy is as real as my grandson’s thumb. Yes, it has many flaws but it is legitimate. We need to reform the police; speed up justice; make babus accountable; stop criminals from entering politics; etc... Yet, this democracy has done a colossal amount of good. It has raised the prospects and self-esteem of the lowest in our society and protected us from the great genocides of the 20th century. Gujarat, to its disgrace, may have killed 2,000 people…. One may be justified in taking up arms against a loathsome African or Latin American dictator but not against the Indian state.

Methinks Das lives in cloudcuckooland. It is not unsurprising, therefore, that the author of a book on “being good” ends up reposing full faith in the central State’s police minister, in charge of a force that specializes in “being bad”:

For once we have a home minister who understands the Maoist threat to our nation and is determined to act with courage. It is pathetic that he should be slowed by endless debate on development versus police action; or whether helicopters should fire on rebels and risk civilian casualties. We have talked for two decades. Enough is enough. No ifs or buts, you cannot negotiate with someone with a gun. Now is the time for action.

Shoot the fuckers, says Das.

Actually, we cannot negotiate with The State because The State has all the guns. People rise up against such a predatory State not because of any “ideology,” but only to preserve themselves. And most of these people don't have guns. They fight with bows and arrows, spears and machetes.

Das’ unequivocal support for our “democracy” only serves to paint a rosy picture of a huge house of horrors. He professes to be a “free market” kind of thinker – but there is a lot of difference between a free market (which means Liberty from the State) and “democracy,” which is just the meaningless ritual of the vote. The free market allows us to earn our keep, to obtain our needs, to survive. The vote only gets us one group of rogues or the other to plunder and oppress us. I have never supported Aung San Suu Kyi in Burma because all she harps on is about “democracy.” I have never heard her use the terms “free trade” or “free market.” Das’ column also does not advocate free trade and free markets for our poor adivasis. He wants their revolt sternly suppressed. Methinks there is nothing subtle about his dharma at all. His only dharma is The State.

Not Gurcharan Das, it is Vir Sanghvi who is really being good, especially when he says:

We understand what this protest is about and we recognise that the Indian State has failed.

By "we" he is referring to the entire urban middle class.

Get to grips, folks. It’s not just that the cities are hell-holes, that every small town is a disaster – even the jungles are revolting. Manipur, Kashmir, and all these 230 Maoist-Naxalite affected districts – these tell a story of State Failure that is probably unparalleled in the history of the world. So many millions of ordinary people did not revolt against the East India Company in 1857. There is something big happening in India, something called widespread rebellion. We need to wake up. Read Sanghvi. Das' column will put you to sleep. It is opium on a bright Sunday morning. After reading this kinda shit I need a strong joint myself.

For Liberty, Against An Enemy

Last night, at a little past 10, I drove to my nearest booze shop to pick up some beer and it was closed. I asked around if there were any other shops open at that early hour, and was told to drive to Badarpur, Haryana. Someone else said, “Try the slums. You always get booze there.” But I gave up. Effective demand did not meet supply. The commonwealth lost.

Frankly, I see this “Wee Willie Winkie” policy of The Total Chacha State forcing shutdowns of all businesses in our cities as a massive tyranny; senseless too. Nowhere in the civilized world are cities forced to go to sleep. Indeed, they all say, “Cities Never Sleep.” In such cities, you get booze all night – but it costs more. And there is a full nocturnal economy at work – taxis, bars, restaurants, and so on, a very lucrative nocturnal economy at that. In Amsterdam, I was at the Late Night Bar till 4 am – and they were not closing. The city was wide awake, and brightly lit up, as I staggered to my hotel, smoking my last spliff.

Actually, in our cities, there are many people who work night shifts – taxiwallahs, rickshawallahs, railways personnel, airports, hospitals, chemists, petrol pumps, and many more. It follows that if all these Wee Willie Winkie rules were abolished there would be all-round gains for the commonwealth, because the city economy would now be a 24-hour economy. Such an economy would surely produce much more wealth than an 8-hour economy.

Liberty is all that we need.

Liberty!

However, a senior economist of Indian origin from the USSA, Kaushik Basu of Cornell, has a corny column in the HT today, where he discusses Marxism and Engels in glowing terms. He refers to the “marginal revolution” as having originated in the minds of Walras, Jevons and Pareto (??) – intentionally missing out on Carl Menger, the greatest of them all, founder of the Austrian School. He uses this mistelling of the history of ideas to laud mathematical economics - which every Austrian considers nonsensical. It is his conclusion that is noteworthy for its total wrong-headedness. He writes:

While Marxism as science has failed, it will be a pity if the idealism and the quest for justice that was the moving force behind the lives of Engels and Marx were also abandoned. As Hunt notes at the end of the book, Engels was “convinced that there was a more dignified place for humanity in the modern age. For him and Marx, the welcome abundance offered by capitalism deserved to be distributed through a more equitable system. For millions of people around the world that hope still holds.”

Kaushik Basu’s great ideal is redistribution – by The State. He wants to plunder the rich and spread the money around. He calls this “justice.” I call it theft. See my recent column against “social justice.”

I see this The Total Chacha State as the prime cause of poverty, and champion Liberty.

You decide.

(There is also an earlier post against Kaushik Basu’s nonsense, here.)

Finally, ET has a news report on the fact that over 50% of the recently elected MLAs are crorepatis (millionaires).

I find this a disturbing trend: that politicians get rich while the people stay poor.

This is what 60 years of étatism has bequeathed us. Now do you see why I champion Liberty?

On The CONgress, Westminster, And Olde London

As we have been religiously doing for 60 years, we have done so again – and voted. And, as usual, the CONgress has won. Chacha has some more bhateejas. Ho hum.

The editorial in the Express is interesting. It specifically refers to the challenge of urbanization that Maharashtra faces. The editors say:

The biggest story of this election is urbanisation. Once again, both the larger cities — Mumbai, Pune, Nagpur — and the many smaller urban agglomerations across the state have been central to determining which combine came out in front. And how this next government handles urbanisation is crucial; managing that process should top its agenda.

As if on cue, the central cabinet has announced its decision to reserve 50% of all seats in municipalities for women. Just as the central Total Chacha State has made every Bhateeja State into a client; just as they have made every panchayat into a client; so too are their efforts directed towards converting municipalities into clients. Their only desire is to inject politics, reservations and clientelism into civic affairs. Under such perverse central direction, India’s teeming cities and towns will never ever be well governed.

History sheds light on how we need to proceed. We call our democracy as based on the “Westminster model.” Westminster is that part of London where parliament meets. Yet, history tells us that Westminster did not exist when the first Lord Mayor of London was elected in 1183, some 30 years prior to the signing of the Magna Carta. In other words, urban local self-government lies at the base of the English constitution. We have imitated Westminster. We now need to emulate the citizens of Olde London, the City, the famous “one square mile.” It is this one square mile of Liberty and self-government that has always been the bastion of British capitalism.

What history reveals is that the Lord Mayor of London was never a client of the King. Indeed, the institution was erected to keep the King out of the city. The title “Lord” was never given by the King; rather, it was bestowed upon the head of the civic government by the citizenry. Throughout history, Lord Mayors of London have been wealthier that the English kings. They lent vast sums to the crown. Indeed, when Henry V set off to Agincourt, he secured the necessary funds from London’s Lord Mayor by pawning some of his jewels. At the civic reception held to wish Henry V well in his forthcoming battle, the Lord Mayor of London was seated to the immediate right of the King. Since then, tradition holds that the Lord Mayor of London is second only to the King of England.

The traditions that have been meticulously maintained till today reveal the seriousness with which civic independence was taken. The Lord Mayor carries the “civic sword.” When the King of England visits the Olde City, the Lord Mayor meets him at the gates and surrenders this sword. The monarch touches the hilt in acceptance. There is much to read in this tradition.

Thus, the King of England cannot march his army through Olde London without the permission of the Lord Mayor. Whereas Bobbies patrol Westminster and the rest of Greater London, the Olde City has its own police force.

It needs to be stressed that these extremely wealthy Lord Mayors of London have never been clients of the King. History also tells us that this was never an “office of profit,” and whoever was elected always spent more money than he received – especially on grand banquets. This is why many, many men refused to accept the office – and they were then fined heavily. It is said that Mansion House, the official residence of the Lord Mayor, was built for those who wanted to become Lord Mayor out of the pockets of those who did not.

On the amazing wealth of these gentlemen who not only built English capitalism but also erected and maintained the greatest institution of civic independence the world has ever seen, the best story is of Bartholomew Rede, Lord Mayor in the early 17th century. It is recorded that, at one of his banquets, an Italian approached him offering to sell a big jewel for 1000 guineas. However, this Italian made the mistake of telling the Lord Mayor that the King of England could not afford to buy this jewel. Bartholomew Rede immediately bought the jewel for 1000 guineas, and had it ground into his glass of wine. He then drank the contents of the glass in one big swallow and told the Italian: “Speak honourably of the King of England, for thou hast just seen one of his subjects drink 1000 guineas in one quaff.”

Our “Westminster model” is thus a “con” – a con perpetrated upon us by the CONgress party, the greatest confidence tricksters the world has ever seen. We are made to look upon the mighty central State as the fount of government and democracy. In truth, it is just Laputa. If we want to run our cities and towns well we must develop mayoralties on the “London model.” Think about it.

If you want to read more about the Lord Mayor of London, buy this book.

Bhola On The Stock Exchange

I have chosen the ganja leaf as my flag not only because I love the Noble Herb. More than that, I would like this leaf to be seen as a symbol of the greatest tyranny ever to have visited a peaceful people.

Orissa is the one province of India where ganja is legally sold. This has to do with the fact that almost everyone there is a smoker – I even met a senior politician with whom I shared a few spliffs. I heard that it is quite common in Orissa to find a grandfather, son and grandson smoking a chillum together. I had the occasion to visit a small hamlet a short distance from Cuttack. Under the banyan tree I found a whole lot of men smoking chillums and joined them. It was a village of about 500 adult males, and my inquiries revealed that over 5 kilos of ganja was smoked in that little village every day.

What is true of Orissa is also true of Bengal, where both ganja and opium were legally sold even as recently as the 1980s. When I was a child, my father used to regale me with funny stories of an eccentric ganja-smoking uncle he had in Khulna, now in Bangladesh; a poet.

Living in a Bengali enclave in Delhi, it is easy to find the deep roots this herb has in Bengali culture. A little shop I discovered in the market, specializing in goods connected with Hindu pujas, sells chillums, what Bengalis call kolkay – not for smoking, but as offerings to the gods. Indeed, they also sell tiny sachets of bhang without which devout Bengalis cannot offer Narayan puja. Thus, in this market of Bengalis, I found a group of hardy chillum smokers – and joined them. They have migrated here from rural Bengal, to sell labour services in this shitty city. They prove that ganja is a part of Bengali culture.

What is true of Orissa and Bengal is equally true of UP, Bihar, Uttaranchal, Himachal, and even Kashmir, where I received great charas delivered right to my houseboat deck. The ganja culture is less prevalent in southern India, but Kerala, Karnataka and Andhra grow some of the best. I recall staying in a tiny town in Karnataka for some time, where there were enough ganja smokers to keep a few dealers in good business. Language makes it impossible for me to communicate with the rural folk of south India; but I have looked deep into the eyes of the men, and I do believe there is widespread use of the noble herb here as well. Too many men with bloodshot eyes wearing beatific smiles.

Having said that, let us turn to the tyranny. The stuff my chillum-friends in the market smoke, the stuff I buy in the nearby slums – this stuff is awful. This is the tyranny. The police have prohibited nothing; rather, they control a lucrative trade. They exploit customers by selling third-rate stuff. They harm public health.

My sympathies lie entirely with the poor people, those who toil and labour, and spend a few bucks on ganja, to obtain some “cannabliss.” In my own case, I know very well that after some hard work I too like to unwind and relax with some of the same stuff myself. There are but a few pleasures in life, but here in India it seems that the official religion is suffering. They suffer, and they make us all suffer.

Yet, my trip to Orissa revealed that limited legalization is no answer. Here, I found the legal shops selling crap. I could buy decent stuff only from the underground. In the little hamlet referred to above, where 5 kilos of ganja was smoked every day, the dealers were all illegal. They could not afford the 75,000 rupee license fee and preferred to operate by paying small bribes to the cops and excise goons. In Bengal too, when ganja was sold through licensed shops, the stuff was awful.

I therefore advocate the entry of Bhola into the stock market – and Bhola traditionally rides a bull. Very auspicious indeed. We could do with a dozen or more cannabliss companies. And let brand names assure us of quality.

In tough, recessionary times, the best way to stimulate an economy is by removing all obstacles to business. Cannabis can be a HUGE business. ITC, the Ambanis, Mallya – they will all look tiny before a majestic Bhola Unlimited Company Ltd. Ganja farmers will prosper. The commonwealth will achieve all-round gains.

So, let’s just do it.

Against Trade Unionism

There was a big strike in Gurgaon – and one of the eminent opinions on it is in serious error. I was about to start writing when the doorbell called me away. It was the housemaid. And my only thought was this:

If anyone cares about “workers,” they should care about these women. They have no unions. Their wages are market-determined under highly competitive conditions. And they can be fired at will. With 60 years of unionism and industrial unrest behind us, this is a fitting moment to finally arrive at the correct judgement of what economic conditions are in the best interest of ALL workers, those who own and sell labour services.

Responding to the strike, our business papers have demonstrated divergent attitudes. Mint concludes that the profit motive guides unionists – I would have preferred the word “blackmail”: see The Strike-Treat System by WH Hutt. They also write about the fading political strength of these unions; how many are just local thugs. I am looking at the maid, busy with the jhaaru.

However, the Economic Times, while trying to justify unionism as something in the “common good,” has exhibited an ignorance of Say’s Law of Markets. Their specious argument runs as follows:

Rationality at the level of an individual enterprise might suggest that lower wages yield higher profit margins. But once you factor in the fact that one enterprise’s workers are other enterprises’ consumers, the enterprise-level rationality becomes irrational at the level of the economy. The greater the workers’ collective income, the greater the demand for the economy’s produce, growth and profits. The more time away from work workers have, the better for businesses such as books, newspapers, music, movies, sports and TV.

This is something like the famous “Candlemakers’ Petition” of Frederic Bastiat: an attempt to show that if some group is given some privileges, they will buy more of the output of other groups. Farmers could make the same arguments – and probably do. Sarkaari baboons insist that their undeserved salary hikes boost market demand. We are fortunate our housemaids don’t say such things when asking for a much-deserved raise from a cantankerous employer.

The Law of Markets says that “the sale of X gives rise to the demand for all non-X.” The implication is that our interests differ when we are competing, from when we are not. If we want to raise the demand for our products, the only way is to allow a completely free market for all those we do NOT compete with. Of course, other businessmen, knowing this law, will demand similar conditions in our industry too. And this would really be in the true interests of the “commonwealth.”

The vital implication of Say’s Law is that all monopolies and restrictions are bad. They raise the prices of some essentials – like labour. When people spend more on these they have less left over for other goodies on the market. We all lose.

Thus, Say’s Law tells us exactly the opposite of what ET is saying. It tells us that the best economic conditions are those when all goods and services, including labour, are competitively sold – and are therefore cheap.

Those who wish to understand the Law of Markets, which “macroeconomics” knows nothing about, are advised to read WH Hutt’s Towards a Rehabilitation of Say’s Law. This rehab was necessary because the Keynesians had obliterated this law from all official learning. The Mises Institute has thoughtfully provided the world with a copy of this important book online.

The late Professor Hutt has also written some important books against trade unionism. In an essay on immigration, which reduces wages, he argued that this would benefit the commonwealth. He was a great classical liberal, and students would be well advised to study all his works. We must rehabilitate Hutt before we can rehabilitate Say.

The crucial point Professor Hutt keeps driving home is that unionism can never benefit ALL workers. Ask me. The maid is still at work. Unionism has never benefited her. Indeed, the very opposite is true: Unionism has harmed such unorganized, individual workers. They have reduced employment opportunities for all workers outside their “combination.” The true interests of all workers – and especially of workers as consumers – lie in a completely free market for labour services; and free trade.

Let us now proceed to legal issues. Of crucial importance to our conception of the “rule of law” is what constitutes the legitimate use of force. Now, unions are legally authorized to use force to press for their demands. This began gradually in Britain – where all bad ideas also began – as Professor Hutt recounts; but it was slow in the 19th century, the age of Gladstonian liberalism and the reign of Queen Victoria. It was shortly after both had passed away that the British liberals made their greatest error – by passing the Trades Disputes Act of 1906. Bruno Leoni quotes an eminent Law Lord of England describing this legislation as a “violent operation on the body politic.” Thereafter, liberalism declined in Britain. The Labour Party rose. And Britain has been destroyed. Let us learn from this well-meaning, but poorly considered, attempt to improve the lives of workers.

Like the rest of us, workers need competitive markets. And free trade – so they can succeed as consumers. After all, the work itself is disutility. It is when the wages are spent that satisfaction is achieved. So our thinking on this subject is wrong on many fronts.

Finally, it all boils down to our general misconception of “rights.” No one has a “right to a fair wage” as no one has an “obligation” to pay any such wage. The demagogue who propagates such wild delusions should be considered a rogue and a threat to public peace. In reality, the worker who has signed a labour contract has an “obligation” to perform his duties, while his employer has the “right” to demand this work.

The strike in Gurgaon was over the sacking of 16 indisciplined workers. They rioted. The police fired. One guy was killed. Another strike is being planned. They want a reinstatement of the sacked workers. They will never allow NEW workers to be hired. This is the restriction on the market they are legally privileged to enforce. It hurts all other workers, those outside the union. It hurts the commonwealth. It should be illegal to do such things.

Once again, Adam Smith’s words on “the system of natural liberty” are worth mulling over:

Every man, as long as he does not violate the laws of justice, is left perfectly free to pursue his own interest his own way, and to bring both his industry and capital into competition with those of any other man, or order of men.

Good man, Adam Smith. He had the true interests of the poorest in mind, like the maid.

Oops! Disaster! The maid and the maalkin just had a tiff. She quit!

Liberty!

On Politics, Catallactics, Cops, And GUNS!

Thanks to LRC for directing the world’s attention to an article by Karl Hess (1923–1994) titled “The Death of Politics,” originally published in Playboy magazine in 1969. This essay champions a radical libertarianism while condemning the “State politics” that we mistakenly call “democracy”; and, as I will attempt to show below, we make a bigger mistake by calling “politics” – which are the “public actions of free people,” something very different from the secret wheeling-dealing behind closed doors that contemporary “party politics” is all about. Witness the meetings of the Congress High Command. Hess roundly condemns this kind of “State politics,” ending with these profound and hopeful words:

Power and authority, as substitutes for performance and rational thought, are the specters that haunt the world today. They are the ghosts of awed and superstitious yesterdays. And politics is their familiar. Politics, throughout time, has been an institutionalized denial of man's ability to survive through the exclusive employment of all his own powers for his own welfare. And politics, throughout time, has existed solely through the resources that it has been able to plunder from the creative and productive people whom it has, in the name of many causes and moralities, denied the exclusive employment of all their own powers for their own welfare.

Ultimately, this must mean that politics denies the rational nature of man. Ultimately, it means that politics is just another form of residual magic in our culture — a belief that somehow things come from nothing; that things may be given to some without first taking them from others; that all the tools of man's survival are his by accident or divine right and not by pure and simple inventiveness and work.

Politics has always been the institutionalized and established way in which some men have exercised the power to live off the output of other men. But even in a world made docile to these demands, men do not need to live by devouring other men.

Politics does devour men. A laissez-faire world would liberate men. And it is in that sort of liberation that the most profound revolution of all may be just beginning to stir.

I strongly recommend that you sit back, relax, and read the entire essay. You will emerge hugely enlightened.

Having said that, what I would like to add to the world’s enjoyment of this essay full 40 years after its publication, is that the basic error in Western political thought has been over the idea of “community.” This is the cornerstone of their "conservatism." And their "socialism." This is a remnant of their tribalism; it is “atavistic,” like their socialist sympathies.

In India, a huge multi-cultural sub-continent, there is nothing called “community” in any of our great cities. The great bustling centres of Indian civilization are all melting-pots, especially New Delhi; and we in Delhi sneer at those parochial politicians of “Mumbai” who idealise the Maratha tribes of Shivaji. The BJP’s “Hindootva” agenda has not worked because the Hindoos are not a homogenous tribe, never have been, and never will be.

This is indeed our greatest strength. We are therefore in a position to view our world as a “catallaxy,” where we interact in harmony with complete strangers, and the more strangers the merrier. There is no need for us to think in terms of either "community" or even "society" - the words that lie at the root of "communism" and "socialism," both evil ideas that originated in the West.

Instead, we can conceive of our world as one of Individuals, interacting peacefully and gainfully with previously unknown individuals in markets - a world of friendly strangers, a "catallaxy."

The only requirement is that the strangers be peaceful and friendly, not belligerent and hostile, in which case I discuss below what steps we need to take...

My peaceful idyll in southern Goa became a great catallaxy every winter, when the happy and peaceful tourists of various races, religions and nationalities invaded our shores. And how the local people loved it. They put up a hundred "BAR & REST" shacks (they never write the full word "restaurant") on every beach. The more strangers come, the merrier, they always cry.

In either case, the area was always a catallaxy, there being a mosque, a temple and a church all within walking distance from our cottage. The great event was always the Saturday bazaar - where everyone came well dressed. It is there that I discovered "natural order," for cops were never seen, and also really reflected hard and deep on the MEANING of the word "catallaxy."

The entire section on what would be called “economics” in Mises’ Human Action is called “catallactics.” Mises mentions somewhere that the term was first used by Bishop Whately in the 1850s. The word means “the science of exchange.”

However, Hayek discovered two other meanings of the word in Greek:

The first, “to turn from enemy into friend”;

and the other, “to welcome into the community.”

The future lies in welcoming friendly strangers into every community – in turning communities into “catallaxies.” Through peaceful, voluntary and mutually beneficial exchanges with strangers. But what if the strangers are not friendly and peaceful and turn out to be belligerent and hostile?

First: let us not get too carried away by the great big myth of national defence, or the existence of terrorists, Maoists, Naxals, etc. We cannot depend on The Chacha State to protect us. 200 people were killed by 10 men in Mumbai only because the people have been disarmed – see what happened to Sanjay Dudd.

Anyway, 130,000 people die on our roads every year, or over 350 every day. Ever heard The Chacha State get worked up about that? And these people have all the guns.

Indians need to wake up to their rights to arm and protect themselves. They say, “A gun in the hand is better than a cop on the phone.” They also say that if you phone the cops and phone for a pizza, the pizza always comes first.

I am an old member of Indians For Guns – and they have released an excellent essay on the subject of guns and gun control in India. You can read it here.

At the philosophical level, the man who first mooted the “private provision of security” is Gustave de Molinari, friend and associate of Frederic Bastiat, who was the Editor-in-Chief of their Journal des Economistes. Molinari correctly diagnosed State Police as based on the ideas of “monopoly” and “communism.” You can read Molinari’s brief essay here.

Finally, something to laugh about. A senior Indian cop writing about how his costumed goons “defend our liberties” and even “die for the country.” Of course, in our bazaars we all see that these costumed brutes are more self-interested than the greedy merchants this officer’s JNU professors must have taught him to despise. But this takes the cake for rank hypocrisy.

As if on cue, Aristotle the Geek has provided this "prophesy" of Any Rand on how modern "criminal justice" will turn us all into criminals, because they want the laws broken. It is all about power. Not Law.

We must think in terms of being responsible for our own protection. Guns. If we go on depending on the State Police for our protection we will be like little Linus and his "security blanket." Give me my own guns any day.

Antipolitics. Antistate. Antiwar. Pro-Market.

From Internet Access... To Firewood

An editorial in the Economic Times today makes the serious intellectual error of asking for internet access being included as a “human right.” In étatist France this has just been proposed; and, as I read sometime ago on the LRC blog, this is going to happen in socialist Sweden as well, where they are going to make extremely high speed broadband access a “human right.”

This blog stands for “private law.” In a private law world, you can only have a “right” if someone else has a matching “obligation” – usually through a signed contract. Thus, I have the “right” to occupy the apartment that I have leased because the landlord has the matching “obligation,” as per signed contract, to hand over peaceful possession of his apartment to me.

In the case of “human rights,” no one has any “obligation.” Our recently acquired “right to education” will therefore go the way of all other human rights enacted by the UN, that great big club of States. And note that it is States that are invariably guilty of “human rights violations.” The solution to these violations lies in constitutional law that will strictly limit the powers of The State. But our Constitution of India is an unlimited constitution, and our The Chacha State is thus a Total State. This State is a violator of our rights, our liberties, and our properties. Our editors must call for strict laws on State functioning – the “public law” – instead of adding to State powers and responsibilities by calling for yet another useless human right.

While ET blabbers about our supposed rights to internet access, their competitors, Mint, have published an important article today on the fuelwood industry. The statistics are perhaps nothing more than guesswork, but the situation described is real enough. Even in prosperous Goa, it is quite common to see women carrying firewood on their heads and heading home.

However, let us take comfort from the fact that such scenes were commonplace in the West even as recently as a century or two ago. I have a vivid recollection of a very old souvenir shop I paid custom to in Interlaken, Switzerland, where they were selling carved wooden figurines of Swiss women carrying firewood on their heads.

The only solution is modern forms of energy – electricity, gas, etc. But these are all State monopolies in India, so there is a huge shortage. This demand-supply gap can only be bridged through privatization and free markets. Let the energy industry compete to supply these poor people dependent on firewood with the cheapest energy possible.

Again, on this score, the climate change / global warming wallahs are only talking about subsidizing “clean” energy. Against this nonsense, Cris Lingle makes this important point in his column in Mint today:

Another issue related to global climate talks is that paying for a shift to “clean” energy requires that taxpayers accept lower living standards. This is because nearly all “clean” energy initiatives involve very large subsidies that must be funded by higher taxes. Only by wilfully ignoring the large government-funded payouts can proponents of alternative energies insist they will lead to net gains.

Thus, all that these bozos will bring about is a huge increase in the numbers of tax parasites among us. They must be defeated.

Cris Lingle’s column is full of good news, though. According to his analysis, the talks in Copenhagen will achieve zilch. They will fail. They must.

Climate change, indeed. Also recommended is my old column on all this “hot air.” Complete nonsense.

On Adam Smith, The Great Free Trader

We will never understand Adam Smith unless we understand that he stood above all for free trade – and, that too, in the interests of the poorest and the least developed regions.

John Rae’s Life of Adam Smith (1895) contains the full text of a letter he wrote to Lord Carlisle, then First Lord of Trade and Plantations. The letter is dated 8 November, 1779, or about three years since the publication of the Wealth of Nations. Smith’s opinion had been asked for by the government on the question of free trade for Ireland. Smith defended the idea wholeheartedly. Ireland was then wretchedly poor, but labour was cheap – “pauper labour,” it was called – she possessed many natural advantages; but the vested manufacturing interests of England were opposing the idea vehemently. This particular paragraph from this letter is truly FANTASTIC:

Should the industry of Ireland, in consequence of freedom and good government, ever equal that of England, so much the better it would it be not only for the whole British Empire, but for the particular province of England. As the wealth and industry of Lancashire does not obstruct but promote that of Yorkshire, so the wealth and industry of Ireland would not obstruct but promote that of England.

In another letter to Henry Dundas, then War Secretary under the younger Pitt, Smith begins by opposing the vested manufacturing interests of England and Scotland. He writes:

I perfectly agree with your Lordship too that to crush the industry of so great and fine a province in order to favour the monopoly of some particular Towns in Scotland or England is equally injurious and impolitic. The general opulence and improvement of Ireland must certainly, under proper management, afford much greater Resources to Government than can ever be drawn from a few mercantile or manufacturing Towns.

The letter concludes advising the cabinet minister that it would be “madness” not to grant free trade to Ireland. Madness is a strong word, coming from Smith. This, in a letter to a senior cabinet minister.

John Rae points out that Adam Smith was a free trader long before his books were published. He had converted the entire business community in Glasgow to free trade – so much so that a politician canvassing support for protectionist measures in the 1750s found none in Glasgow willing to take up his cause. There is another story of a coach ride between Edinburgh and London during which he converted his traveling companion, a youthful Lord Shelbourne, to free trade.

Cobden, Bright, Bastiat, John Prince-Smith – they all championed free trade guided by Adam Smith’s ideas. It is this idea above all that is in the best interest of all nations, rich and poor. India should set the example by embracing free trade unilaterally. And these words of Adam Smith should be made immortal:

Should the industry of Ireland, in consequence of freedom and good government, ever equal that of England, so much the better it would it be not only for the whole British Empire, but for the particular province of England. As the wealth and industry of Lancashire does not obstruct but promote that of Yorkshire, so the wealth and industry of Ireland would not obstruct but promote that of England.

Hear! Hear!

Revolution Calling!

I recall a colleague in the Economic Times once telling me, “You are a good journalist.” Instead of thanking him for the compliment, I replied, “I am not a journalist. I am a revolutionary.” I don’t write for fun. There is a serious purpose to all this – the overthrow of the regime.

The first “Antidote” column published in ET in 1998 was titled “Revolution Calling!”

I remain singing the same song.

On that happy note, today, I have a podcast for you. In Hindi – the crude Hindi of the streets of Delhi, where I grew up. I recorded it ages ago but never broadcast it, thinking it too obscene. But it just so happened that I heard it again last evening, and found it hilarious, and serious as well. Pretty neat, in fact.

You can play the podcast by clicking here.

I just hope you enjoy it. Happy Diwali.

And as for those who might take grave offence at the language – imagine an Eminem in Hindustani – I have these words from Alice Cooper:

No more Mr. Nice Guy,
No more Mr. Clean,
No more, Mr. Nice Guy,
They say, he’s sick,
He’s obscene.

Push the tempo!

On Gold, On An Auspicious Day

My column in Mint advocating a return to the gold standard has been published today – on the eve of Diwali, when ordinary Indians untutored in Economics traditionally buy lots and lots of gold. Seems like ordinary Englishmen are doing this too – for Harrod’s is now selling gold bullion and coins off the shelf. You can buy a 12.5 kg gold bar on the spot if you so desire. I think I have written an important column at a historic moment of time.

Fortunately, all is quiet on The Chacha State front.

So you all can focus all your attention on my column.

It is my Diwali gift to my impoverished nation. This is a “festival of lights” – and I hope I have lit thousand watt bulbs inside your heads.

Dimaag ki batti khul gayee.

Like having a Banarasi paan with a few coca leaves in it.

Leaves your brain buzzing.

Enjoy the trip.

Not Democracy, These Are Tax Parasites

As usual, there is never any good news from our The Chacha State. The first thing I read today was that they are “infusing” 5000 crore rupees into Air India. Frankly, if I had 5000 crore rupees spare in the public kitty, and wanted to give a fillip to civil aviation, in the interest of consumers, who are "the people," I would abolish all taxes on aviation turbine fuel, using the cash to compensate state governments for the revenues they would lose. Makes much more sense. But our The Chacha State represents tax parasites, not taxpayers. And there is more evidence on that score in the news today, from Chacha's bhateejas.

First comes the astonishing news that the Tamil Nadu Bhateeja State is going to distribute colour TVs to “all.” The deputy chief minister is quoted in this news report as saying:

He said 1,04,42,500 colour TVs had been purchased and distributed to around 79, 35,975 families.

Is this the “role of State.” Is this why we pay taxes?

The attitude of our socialist-democrat politicians to the contents of the public treasury is brought out best by this story from Karnataka, where 1 crore was spent on one meeting of the Bhateeja State cabinet; of this money, 28 lakhs was spent on decorating the venue with flowers. The meeting, attended by 34 ministers, their secretaries and staff, lasted “a couple of hours.” No earth-shaking decision was taken. I wonder how much was spent on getting everyone to Gulbarga, 623 kms from Bangalore, the state capital. They must have flown in, ‘coz there couldn’t be much of a road between Bangalore and Gulbarga. Why, there isn’t much of a road between Bangalore and Banerghatta, 20 kms away; or between Bangalore and Sarjapura, 20 kms away on the other side.

It is not hard to believe that “socialism” combined with “democracy” – both powerful words – should bring the nation to such a sorry pass, ruled by parasites. In truth, this had been foretold long ago – by Frederic Bastiat, for instance, in the 1840s. In his brief and humorous essay, “The State,” Bastiat defined the beast thus:

The State is that grand fiction by which everyone tries to live at the expense of everyone else.

He added:

Everyone wants to live off The State. They forget that The State wants to live off everyone else.

In another essay, one that is justifiably more famous, “The Law,” Bastiat exposed the deep errors in Rousseau’s conception of democracy; adding that the only results would be “legal plunder” guided by an ideology of “false philanthropy.” It is precisely these that plague our society today. But there is more:

Political economists have for long been saying that a fiat paper currency is incompatible with democracy. The idea of democracy is representation of the taxpayer, and nothing else. “No taxation without representation” has always been the rallying call of democrats. In England, for over 500 years, the monarch would call a parliament only to obtain a vote on taxes.

However, with central banking and a fiat currency, The Democratic State comes in possession of a money-making machine, something monarchs never had. With such a State established, parliamentarians only work towards channeling State expenditures towards their clients – what is called “pork-barrel politics” or “log rolling.” MPs no longer represent taxpayers because their The State is not dependent on tax revenue. It can print the money on its own. And it can buy up all the support it needs with this “funny money” – witness the MPLADS. All those who believe in the true ideals of democracy must join in the call for “sound money.”

What is the Role of The State in a free society? Writing in 1776, before mass democracy, Adam Smith listed out the “three duties of the Sovereign.” They are:

According to the system of natural liberty, the sovereign has only three duties to attend to; three duties of great importance, indeed, but plain and intelligible to common understandings: first, the duty of protecting the society from violence and invasion of other independent societies; secondly, the duty of protecting, as far as possible, every member of the society from the injustice or oppression of every other member of it, or the duty of establishing an exact administration of justice; and, thirdly, the duty of erecting and maintaining certain public works and certain public institutions which it can never be for the interest of any individual, or small number of individuals, to erect and maintain; because the profit could never repay the expense to any individual or small number of individuals, though it may frequently do much more than repay it to a great society.

Defence, the “exact administration of justice,” and ROADS. Not money. Not "making law."

Not television sets. Not airlines. Not steel plants and hotels.

How does the “system of natural liberty” operate? Adam Smith described it thus:

All systems either of preference or of restraint, therefore, being thus completely taken away, the obvious and simple system of natural liberty establishes itself of its own accord. Every man, as long as he does not violate the laws of justice, is left perfectly free to pursue his own interest his own way, and to bring both his industry and capital into competition with those of any other man, or order of men. The sovereign is completely discharged from a duty, in the attempting to perform which he must always be exposed to innumerable delusions, and for the proper performance of which no human wisdom or knowledge could ever be sufficient; the duty of superintending the industry of private people, and of directing it towards the employments most suitable to the interest of the society.

We must move from here to there – and fast.

For A Big Bang Diwali

Diwali, the festival of lights (and sound) is just around the corner, but kids in Delhi are not being allowed to celebrate the occasion with crackers, on the spurious reasoning that this will “damage the environment.”

Oh, how many excuses these killjoys use to kill any fun that life may have in store for us miserable Indians. Our motto must be to suffer real private deprivation for some imaginary “collective good” or the other.

Frankly, I do not think the total amount of smoke released on Diwali night if firecrackers are allowed free rein will exceed that released by a single active volcano in one day. The earth is a huge planet and the atmosphere is even bigger. If Obama can bomb the moon, surely we can blow crackers once a year?

During my years in southern Goa, one thing that never ceased to amaze me was the fact that not a single night would pass without a whole lot of crackers going off. I made some polite inquiries as to what my neighbours were celebrating every night and was told that the occasions vary. In one house, crackers would go off to herald the birth of a child. In another house, to celebrate the start of a new business. In a third, the purchase of a new car. In a fourth… It could be anything. But crackers are a must. Every night. Without fail. I loved it. Chitty chitty bang bang night after night.

Of course, this fascination for crackers was reflected in the nearest market. In Chaudi, my nearest town, there was a shop selling crackers throughout the year. In Delhi you never get crackers except during Diwali. But in Goa, they sell every day. What does Delhi gain by banning crackers even for the one great celebration all Indians enjoy? We must look not only at the loss of fun, but also at the loss of business, and its implications.

Say’s Law tells us that “the sale of X gives rise to the demand for all non-X.” So, if I get to sell my bhel-puri, I am possessed of the means to buy whatever else the market has to offer, except bhel-puri, which I will not demand. I might buy clothes, music, books, tandoori chicken, cold beer – whatever. All these businesses that do not compete with bhel-puri have an interest in seeing that I am allowed to sell bhel-puri. If I am debarred, the energy in the entire catallaxy is reduced.

Applying Say’s Law to the ban on crackers in Delhi, we see that this policy does not hurt just the firecracker business alone; it hurts all other businesses as well. For, who knows, maybe a few SUVs would have been purchased in Sivakasi if Liberty reigned. With liberty, just as the sweetmeat-wallahs get rich on Diwali, so too would the cracker sellers. Then, just as the sweetmeat-wallahs would splurge on other offerings on the market, so too would the cracker-wallahs.

The Lesson: Restrictions and bans hurt not the directly affected industry alone; they hurt the entire market order.

I am therefore of the opinion that we the suffering masses of Delhi should celebrate any and every occasion that comes our way to the hilt, without any holding back. And it is our duty and obligation to our children to ensure that they enjoy whatever small joys life may afford. Diwali is an annual event. And a big one. Let us enjoy it. The killjoys who profess to care for clean air should be put in their place. They are causing all-round losses to the civic community.

No Bells For Another Nobel

I liked David Kramer’s comment that this year’s Nobel prize in Economics has gone to a “commonist.” Note that Cato Institute gave their big prize for advancing liberty to Hernando de Soto, from Peru, a nation full of indigenous tribal communities – and de Soto’s message is one of Private Property. Usually, such communities are seen as examples of “primitive communism,” of common pool resources, and “collective action.” It is remarkable that a Peruvian should champion Private Property in a land of primitive tribesmen.

In the case of the white tribes of Europe, the Angles, Saxons, Picts, Scots, Jutes, Danes… the key law that enabled them to rise to such spectacular levels is Private Property. And, as de Soto points out, the “representation” of this property in transferable titles. Of course, this does not require The State, and can be accomplished within “private law.”

Looking at this prize from an Indian perspective, therefore, I find little to commend it. Our people need to wake up to Private Property. Urban slums will be transformed overnight if de Soto had been the man in the news today.

Ostrom is citied as an important authority on the management of common pool fisheries. But, along our shores, fish die of old age, the fishing being so technologically backward. And my travels along both our coastlines have revealed to me that our fishermen need titles to their beachside properties.

Indeed, much attention in India needs to be devoted to the issue of “homesteading” unowned land. We must not get diverted by “commonism.” Our focus must remain on Private Property, on homesteading. On Private Law. Ostrom’s “commonism” is not an area of research of great relevance to India’s immediate future.

What I find interesting is that, after the “political” prize in Economics to the inflationist Paul Krugman last year, this year’s prize should go to a “political economist.” Obviously, mainstream Economics has little of worth. However, if it is this science that the prize is really meant for, then it should go to Israel Kirzner of the Austrian School, whose work explodes every fallacy in the mainstream approach to “microeconomics.” Austrian thinkers must be honoured today, and I really enjoyed this column by an Indian physicist on how he discovered the teachings of this school of thought. If anything, it illustrates the power of correct thinking in the science of Economics.

Not that “political economists” have not done great work. But, even in this sub-field, the man who richly deserves the prize is Gordon Tullock. He is over 90 now. His work sheds vital light on “government failure” – in a liberal, democratic setting. Had he received the prize, attention would have been focused on his pioneering work, and public opinion would have been much better informed. Another political economist who richly deserved the prize was Mancur Olson – but he passed away some years back.

There is a long list of people who are gone and deserved this honour: Ludwig von Mises, for one; Peter, Lord Bauer, for two. And there is an even longer list of peculiar intellectual insects who have received it – from Wassily Leontief to Gunnar Myrdal. It just so happens that this prize is awarded by a central bank, and the awards committee comprise sarkaari baboos. It is perhaps time that other prizes be put up to be awarded to deserving economists.

Chacha Is Lying

Our prime minister, Chacha Manmohan S Gandhi, is lying to the people. He is reported as having stated:

“The worst is indeed over for the economy,” he said. “The price rise has been due to the drought. Steps are being taken. I am confident the harvest will be normal.”

If you really want to know the horrific truth, which is that things are going to get much worse, then I suggest you carefully read the views of a wise fund manager published in Mint today. This good man begins by making it clear that inflation is caused by printing money in excess – not drought, as Chacha avers. He expects inflation to double the RBI target by March 2010. And there is worse. The mammoth government borrowing programme is going to screw up things a lot more. Interest rates will rise; private borrowers will face problems. The Market will do badly. This prescient fund manager says, of Chacha’s stewardship: “Over the last four years, we have not had fiscal prudence.” He laments the fact that our The Chacha State spends mostly on consumption, and not on capital; on salaries rather than roads.

Now, our Chacha is supposed to be an eminent economist. How come an ordinary fund manager talks more sense than him? I do believe that, if we scratch the surface, we are forced to conclude that Chacha is a liar too, adding to all his other accomplishments. In any decent society, lying on the part of the government elite is considered to be a grave offence, usually resulting in impeachment.

My question is this: If Chacha is bullshitting about The Economy, the most important aspect of life, then how can we believe what he says about Baloochistan, Afghanistan, Kashmir et. al.? We can’t. We mustn’t.

On the other hand, we all know that “you cannot fool all the people all the time.” In politics, as in business, veracity works. Chacha is playing a loser’s game – for himself, for his Congress party bosses, and for the nation.

Wake up!

The Thievery Of The Congress, Exposed

I had planned to write a happy Sunday post on my hero, Adam Smith, but the widely reported statement made by our finance minister pranab baboo that his government will work to “strengthen PSUs” forced my hand.

[PSUs are Public Sector Units, the State-owned industrial sector, India’s “common loss.”]

Indeed, the language is telling: he dismissed reports on privatization, calling them “malicious propaganda.” He was speaking to a trade union audience. He has chosen his friends. We must know our enemies.

Recall that the Swatantra Party never had a trade union wing.

What kind of political party is the Congress, of which the minister is an old hand? Can this party ever “represent” the true interests of the “commonwealth”? At a time when serious law and order problems plague much of the vast territory, what is the “role of State” that this party upholds as its guiding philosophy? The USSR is history, but this party hangs on to failed Soviet-era thinking. I daresay India is doomed unless this party is unceremoniously ousted from power. They are the pits.

If their rank-and-file want to run industrial empires, they should approach the stock exchange, not the public treasury. It becomes obvious that, under the Congress, looters take charge of the public treasury. Their ideology is not “socialism,” for they never think of “society”; rather, their ideology is one of private gain at public cost. They cause the “common loss.”

The core belief of the Congress is that PSUs are “collective property.” Actually, this is the greatest fiction of socialist propaganda, for every PSU is very much the “private property” of client groups who run them, and exploit them, for their own benefit – like the trade unions, and the managers. Just as the minister’s bungalow in Lutyens’ Delhi is a piece of “collective property” that the minister is enjoying as his own – wee the sheeple cannot picnic on his lawns – so too with the PSUs. They are all “private property.” But acquired at public cost.

In other words, these properties have been illegally acquired. The public must re-acquire them, sell them off, and re-invest the money in roads – for roads are real collective property, which every citizen, and the visiting foreigner, can use for free. I am also a great fan of public parks in cities and towns – both the Mughals and the Brits loved them too – which also add to the common wealth of all citizens. We must have a clear idea on Property. The Congress and their professors have confused everything.

There is another story on the Congress today that shows what a bunch of hypocritical old farts these jackasses are: the party organ is carrying an editorial that advises the rank-and-file to avoid showing off their (ill-gotten) wealth. Of course, it must be hugely embarrassing for a gang of thieves when some members indiscreetly flaunt their takings.

In China, Deng said “to be rich is glorious.” He was referring to The Market, not the State-owned industrial sector.

What do we do? Since we are legally barred from setting up a free market party, I suggest we pick up guns and join the Maoists. They are sure to be lesser villains than the Congress. Manas Chakravarty has a nice column today on how he almost joined the Naxals while in college. Yes, they have all the pretty, idealistic girls on their side. They love smoking joints, and there is great mahua in the jungles. So I am cleaning my father’s old gun today and thinking of Orwell volunteering to fight in Catalonia.

Revolt!

No Bells Ring For Obama

On Obama’s Nobel peace prize, the ToI headline was quite apt:

“Lifetime award for debutante Obama.”

True. The man has only been a few months in office.

But the truth is even stranger: It seems the last date for filing nominations for the peace prize was February 1. This means Obama got the prize for the work he did in his first 12 days of office! (Thanks to Karen De Coster on LRC.)

Who nominated him?

Whom did he beat to win the award?

Again, thanks to an LRC provided link, we have the answers to the latter question. Obama beat:

Sima Samar, women’s rights activist in Afghanistan: “With dogged persistence and at great personal risk, she kept her schools and clinics open in Afghanistan even during the most repressive days of the Taliban regime, whose laws prohibited the education of girls past the age of eight. When the Taliban fell, Samar returned to Kabul and accepted the post of Minister for Women’s Affairs.”

Ingrid Betancourt: French-Colombian ex-hostage held for six years.

Dr. Denis Mukwege: Doctor, founder and head of Panzi Hospital in Bukavu, Democratic Republic of Congo. He has dedicated his life to helping Congolese women and girls who are victims of gang rape and brutal sexual violence.

Handicap International and Cluster Munition Coalition: “These organizations are recognized for their consistently serious efforts to clean up cluster bombs, also known as land mines. Innocent civilians are regularly killed worldwide because the unseen bombs explode when stepped upon.”

Hu Jia, a human rights activist and an outspoken critic of the Chinese government, who was sentenced last year to a three-and-a-half-year prison term for ‘inciting subversion of state power.’

Wei Jingsheng, who spent 17 years in Chinese prisons for urging reforms of China’s communist system. He now lives in the United States.

Of course, the peace prize has gone to many American warmongers before, from Theodore Roosevelt (1906) and Woodrow Wilson (1919) to Henry Kissinger (1973). One wag calls this prize “The Arms Dealers’ Cup.”

Pretty ugly, huh?

And Alfred Nobel invented dynamite. His biggest customers were armies.

Personally, I don’t follow the peace prize much, though the prize for Economics has become a disgrace. Last year it went to Paul Krugman in a blatant political move to shore up the Fed and its “stimulus.” Of course, this didn’t work.

But Obama is a very keen stimulus providing president. So perhaps the best idea is that expressed by Stephen Kinsella – give Obama the Nobel prize in Economics too. This way, we kill the credibility of both prizes.

... But There Is Hope

The situation is getting worse on the law and order front, with our Kabul embassy suicide bombed and 17 cops shot dead by Naxalites in Maharashtra. The ToI has an alarmist headline: “India attacked.” It would have been more accurate to say “Indian State attacked.”

These are, however, dangerous times. Such crises allow The State to assume extraordinary powers, and ordinary rule of law disappears. Aristotle the Geek has a good post on this today. Also recommended is this interview with Dr. Binayak Sen on Naxalism in Chattisgarh, where he talks of “State terror.” These are all warning signals. Things are going haywire in India. We must be even more vigilant.

As if on cue, the UNDP reports that India is one of the worst places in the world to live, ranked 134 out of 182. I am sure this UNDP team never visited Jharkhand or Chattisgarh, or Manipur, which must surely be worse to live in than any place in Africa. We are fast becoming “The Darker Sub-Continent.”

It should therefore come as no surprise that not a single Indian university figures in the list of the world’s top 100 universities released today – this, while the entire focus of The Chacha State has been on “education.” What education can they deliver with the worst universities in the world?

John Rae’s Life of Adam Smith contains this remarkable passage on Oxford in those days, a rich and well-endowed university where learning had long been under a “total eclipse.” Read on, carefully:

Smith’s residence at Oxford fell in a time when learning lay there under a long and almost total eclipse. This dark time seems to have lasted most of that [18th] century. Crousaz visited Oxford about the beginning of the century and found the dons as ignorant of the new philosophy as the savages of the South Sea. Bishop Butler came there as a student twenty years afterwards, and could get nothing to satisfy his young thirst for knowledge except “frivolous lectures” and “unintelligible disputations.” A generation later he could not even have got that; for Smith tells us in the Wealth of Nations that the lecturers had then “given up all pretence of lecturing,” and a foreign traveller, who describes a public disputation he attended at Oxford in 1788 says the Praeses Respondent and three Opponents all sat consuming the statutory time in profound silence, absorbed in the novel of the hour. Gibbon, who resided there not long after Smith, tells that his tutor neither gave nor sought to give him more than one lesson, and that the conversation of the common-room, to which as a gentleman commoner he was privileged to listen, never touched any point of literature or scholarship, but “stagnated in a round of college business, Tory politics, personal anecdotes, and private scandal.” Bentham, a few years after Gibbon, has the same tale to tell; it was absolutely impossible to learn anything at Oxford, and the years he spent there were the most barren and unprofitable of his life. Smith’s own account of the English universities in the Wealth of Nations, though only published in 1776, was substantially true of Oxford during his residence there thirty years before. Every word of it is endorsed by Gibbon as the word of “a moral and political sage who had himself resided at Oxford.” Now, according to that account, nobody was then taught, or could so much as find “the proper means of being taught, the sciences which it is the business of those incorporated bodies to teach.” The lecturers had ceased lecturing; “the tutors contented themselves with teaching a few unconnected shreds and parcels ” of the old unimproved traditionary course, “and even these they commonly taught very negligently and superficially”; being paid independently of their personal industry, and being responsible only to one another, “every man consented that his neighbour might neglect his duty provided he himself were allowed to neglect his own”; and the general consequence was a culpable dislike to improvement and indifference to all new ideas, which made a rich and well-endowed university the “sanctuary in which exploded systems and obsolete prejudices find shelter and protection after they have been hunted out of every corner of the world.” Coming up from a small university in the North, which was cultivating letters with such remarkable spirit on its little oatmeal wisely dispensed, Smith concluded that the stagnation of learning which prevailed in the wealthy universities of England was due at bottom to nothing but their wealth, because it was distributed on a bad system.

The “small university in the North” was Glasgow. Scotland was then far, far behind England in everything. Whereas the Thames outside London was a “forest of ship-masts” way back in the days of the Magna Carta, barely any ships came up the Clyde when Smith was a young lad in Glasgow. It is for the development of a backward place that Smith advocated free trade and the end of all monopolies. This is seen in his subsequent strong support for free trade for Ireland in the 1770s, which was then probably the most backward and poverty-stricken province in the whole of Europe.

The story of the great “Scottish Enlightenment” centres around the University of Glasgow, in the back of beyond, a fourteen day journey from London. It is a story of people, not buildings, not equipment, not great libraries, nor huge funds. Extremely remarkable people, among whom Adam Smith was a much loved colleague. There was Black, the chemist, who discovered latent heat; there was Hutton the geologist, who discovered the first theories of the earth’s crust. But the university went further, inviting James Watt to set up his workshop there after the Hammermen’s Guild had refused him. It is here that the condenser for the steam engine was invented. The university encouraged Foulis, the printer, who went on to achieve great distinction in the quality of his books. They even set up a design school. They took an interest in agriculture, textiles – even to the extent of presenting a prize for the “best hogshead of strong ale.”

Universities require people; that is, people who “produce knowledge.” If the most backward province of Britain could enlighten the whole of Europe and America on free trade and the “system of natural liberty” – and on many more subjects besides – then we have hope. But it lies outside The Chacha State.

I leave you with that thought.