State-owned companies like Air India do not fold up when they make losses. Rather, their generous master, The State, always chips in, allowing them to continue in operation. This fact makes it impossible for efficient private players to "compete" with State-owned entities. The very presence of a State-owned company in the fray makes competition unfair. We must realize that our "mixed economy" is, in reality, a very "mixed-up economy." It is not a "middle path" between Socialism and Capitalism; rather, it is a very "muddled path."
In either case, if there are private citizens running businesses in competition with each other, why should The State try to wreck the party? Is that a reasonable "role of State"?
Look at it any way you like, and the only way in which "fair competition" can prevail is if the State keeps out of business. How can a private school come up in a village if the State sets up a free government school? How can private universities compete with State-funded universities that charge very low fees because they are all heavily subsidized?
I started off with the purely economic case for total privatization, here. I then examined the legal, moral and ethical issues involved, here. With this post I sum up the entire argument: The State should be constitutionally kept out of business.
Onwards to that Second Republic!
That's right. The only functions of the state are, maintenance of independent judiciary, internal security, and army. The best the state can do for its citizens is to get out of the way! Running a 'cradle to grave' system, and poking its nose in every affair of individuals is not what it was meant to do.
ReplyDelete"The only functions of the state are, maintenance of independent judiciary, internal security, and army."
ReplyDeletepersonally, i find classical liberals too naive.if all these activities which allow concentration of power with the state is acceptable, it is a slippery slope-why not take care of the economy as well while they are protecting us or solving disputes. state interference in economic matters is inevitable as long as they have monopoly over the enforcement of contracts and ue of force (police etc)