How To Sieze Liberty And End Tyranny

A Harvard educated lawyer called on me the other day to tap my brains on libertarian activism in the depressing conditions of present-day India. I advised him to draw up a Charter of Liberties in the manner of the English in 1215 AD and force our socialist rulers to sign it.

If the histories of civilizations is about “challenge and response,” then the Magna Carta of the English people represents a magnificent response on the part of a subject population to the challenge posed by a lawless and irresponsible monarch. It made Liberty king – and placed this monarch  as well as his successors "under the Law." It was re-confirmed by many English kings throughout the Middle Ages, during which time it became popularly known as “The First Statute of the Realm.” The English still do not possess a written Constitution. Further, then as now, the King did not “make law.” Keeping these points in mind, let us note some of the key clauses of the Magna Carta:

• London and all the other towns and boroughs obtained the liberty to trade freely by land and sea, and to maintain their ancient liberties and customs. These liberties played a crucial role in the furtherance of England’s commercial culture and the development of a ‘body politic’ within feudal covers where local government was bourgeois. Independent urban local government is a corner-stone of the English system of government – and of western civilisation itself.

• Englishmen had the right to brew their own ale – and this explains the ubiquitous English “pub.” These pubs were where people met and talked and drank in an age before tea and coffee were known, and this “public culture” must have played an important role in the open and public nature of English politics.

• The barons retained the right to execute the terms of the Charter; a committee of twenty-five barons was to lead the entire realm into action against the king if he failed to keep his promises: thus, they had the right to revolt against an unjust ruler. William Hardel, Lord Mayor of London then, was on this committee of barons.

• Chapter 12 of the Charter declares: “No scutage or aid [taxes] shall be imposed in our kingdom except by the common council of the kingdom” – which became the rallying cry of democracy: “No taxation without representation.”

• Chapter 39 of the original Charter states: “No free man shall be taken or imprisoned or dispossessed or outlawed or banished, or in any way destroyed, nor will we go upon him, nor send upon him, except by the legal judgment of his peers or by the law of the land.” This is a powerful endorsement of what today we call “the rule of law” or “due process.” There were no “human rights” but there was the writ of habeas corpus.

• Chapter 39 of the charter mentions the term lex terrae, or “law of the land,” which can be taken to mean the common law, especially the land laws and the laws of succession. That is, Property existed before the law. It is because there is Property that there is the law.

Freedom to trade by land and sea; freedom to administer civic affairs without State interference; freedom from taxation without consent; freedom from unlawful arrest, detention, dispossession, and extra-judicial execution; freedom to get high and to produce and sell alcoholic beverages; and conservation of the ancient laws of Property – these will surely benefit every suffering Indian of today. However, given our times, when absolutism has crossed far greater heights while Liberty has dived to far greater lows, I propose a few additional clauses:

• Freedom in the choice of media of exchange. That is, an end to the fiat money monopoly; the end of “legal tender.” RBI paper notes can circulate – but we are free to refuse them. This will impose financial discipline on our The State. Inflationism will finally end. Capital will be accumulated - not consumed. Poor people will benefit greatly.

• The Inviolability of Private Property by any actions on the part of The State – either through Legislation or through its lawless agents.This will guarantee Liberty.

• Freedom from the National Debt: that is, an end to State borrowing. This will impose further restrictions on recklessness and irresponsibility in State spending, while also securing the prosperity of future generations.

I could add some more, but let me stop here.

What I told my visitor is that such a Charter of Liberties, if enthroned as the First Statute of the Realm, will achieve two immediate purposes: firstly, it will take The Market completely out of State purview. This will enable all of us – especially the poor – to survive. Second, it will allow us to administer our cities and towns without State interference, using our own, local resources.

My visitor pointed out that The State would still remain – and that, I said, is precisely what the English also allowed in 1215. They did not execute their King – as in the case of Charles I, or in the case of the French in 1789.

The advantage of this approach is that our The State will immediately have to “adjust its own conduct” to the new situation on the ground. Its personnel will have to change their own conception of their role in society. None of us will have to climb aboard their “pirate ship” to do that – “where angels fear to tread” etc.

Thus, I told my visitor, we will not make the mistake of the CONgress in 1947, who threw out their king only to replace him – and the Freedom that so many fought and died for flew out of the window.

The study of History is extremely useful for it allows us to search the past for examples worth emulating today.

The historic occasion on which the “irresponsible absolutist” King John was forced by public action to sign on the dotted line that Life, Liberty and Property would never be violated by arbitrary royal action is beautifully described in a passage from Jerome K Jerome’s classic Three Men in a Boat – the evergreen tale of a journey down a river. The signing of the Magna Carta took place in Runnymede, which lies on the river Thames between Staines and Windsor.

Jerome & Co. have just passed Staines and are proceeding to Windsor when the author sees Runnymede and this prompts him to reflect on that glorious day in 1215 when Englishmen won their Liberty. It must be mentioned that Jerome says he has written this “especially for inclusion in schools.” Since no school curriculum has ever contained this passage, I hope I am now doing something that would bring great joy to the spirit of Jerome, for he truly was a “jolly good fellow.” What follows is Jerome’s imaginary account of the greatest gherao in human history:

The sun had got more powerful by the time we had finished breakfast, and the wind had dropped, and it was as lovely a morning as one could desire. Little was in sight to remind us of the nineteenth century; and, as we looked out upon the river in the morning sunlight, we could almost fancy that the centuries between us and that ever-to-be-famous June morning of 1215 had been drawn aside, and that we, English yeoman’s sons in homespun cloth, with dirk [a dagger, quite like a kirpan] at belt, were waiting there to witness the writing of that stupendous page in history, the meaning whereof was to be translated to the common people some four hundred and odd years later by one, Oliver Cromwell, who had deeply studied it.

It is a fine summer morning – sunny, soft and still. But through the air there runs the thrill of coming stir. King John has slept at Duncroft Hall, and all the day before the little town of Staines has echoed to the clang of armed men, and the clatter of great horses over its rough stones, and the shouts of captains, and the grim oaths and surly jests of bearded bowmen, billmen, pikemen, and strange-speaking foreign spearmen.

Gay-cloaked companies of knights and squires have ridden in, all travel stained and dusty. And all the evening long in the timid towns – men’s doors have had to be quick opened to let in rough groups of soldiers, for whom there must be found both board and lodging, and the best of both, or woe betide the house and all within; for the sword is the judge and jury, plaintiff and executioner, in these tempestuous times, and pays for what it takes by sparing those from whom it takes it, if it pleases it to do so.

Round the camp-fire in the market-place gather still more of the Baron’s troops, and eat and drink deep, and bellow forth roistering drinking songs, and gamble and quarrel as the evening grows and deepens into night. The firelight sheds quaint shadows on their piled-up arms and on their uncouth forms. The children of the town steal around to watch them, wondering; and brawny country wenches, laughing, draw near to bandy ale-house jest and jibe with the swaggering troopers so unlike the village swains, who, now despised, stand apart behind, with vacant grins upon their broad, peering faces. And out from the fields around, glitter the faint lights of more distant camps, as here some great lord’s followers lie mustered, and there false John’s mercenaries crouching like wolves without the town.

And so, with sentinel in each dark street, and twinkling watch-fires on each height around, the night has worn away, and over the fair valley of old Thames has broken the morning of the great day that is to close so big with the fate of ages yet unborn.

Ever since grey dawn, in the lower of the two islands, just above where we are standing, there has been great clamour, and the sound of many workmen. The great pavilion brought there yester eve is being raised, and carpenters are busy nailing tiers of seats, while ‘prentices from London are there with many coloured stuffs and silks and cloth of gold and silver.

And now, lo! Down upon the road that winds along the river’s bank from Staines there comes towards us, laughing and talking together in deep guttural bass, half a score of stalwart halberdmen – Baron’s men, these – and halt at a hundred or so yards above us, on the other bank, and lean upon their arms, and wait.

And so, from hour to hour, march up along the road ever fresh groups and bands of armed men, their casques and breastplates flashing back along the long low lines of morning sunlight, until, as far as eye can reach, the way seems thick with glittering steel and prancing steeds. And shouting horsemen are galloping from group to group, and little banners are fluttering lazily in the warm breeze, and every now and then there is a deeper stir as the ranks make way on either side, and some great  Baron on his war-horse, with his guard of squires around him, passes along to take his station at the head of his serfs and vassals.

And up the slope of Cooper’s Hill, just opposite, are gathered the wondering rustics and curious townsfolk, who have run from Staines, and none are quite sure what the bustle is about, but each one has a different version of the great event that they have come to see; and some say that much good to all the people will come from this day’s work; but the old men shake their heads, for they have heard such tales before.

And all along the river down to Staines, is dotted with small craft and boats and tiny coracles – which last are growing out of favour now, and are used only by the poorer folk. Over the rapids, where in the after years trim Bell Wier lock will stand, they have been forced or dragged by their sturdy rowers, and now are crowding up as near as they dare to the great covered barges, which lie in readiness to bear King John to where the fateful Charter waits his signing.

It is noon, and we and all the people have been waiting patient for many an hour, and the rumour has run round that slippery King John has again escaped from the Baron’s grasp, and has stolen away from Duncroft Hall with his mercenaries at his heels, and will soon be doing other work that signing charters for his people’s liberty.

Not so! This time the grip upon him has been one of iron, and he has slid and wriggled in vain. Far down the road a little cloud of dust has risen, and draws nearer and grows larger, and the pattering of many hoofs grow louder, and in and out between the scattered groups of drawn-up men, there pushes on its way a brilliant cavalcade of gay-dressed lords and knights. And front and rear, and either flank, there ride the yeomen of the Barons, and in the midst King John.

He rides to where the barges lie in readiness, and the great Barons step forth from their ranks to meet him. He greets them with a smile and a laugh, and pleasant honeyed words, as though it were some feast in his honour to which he had been invited. But as he rises to dismount, he casts one hurried glance from his own French mercenaries drawn up in the rear to the grim ranks of the Baron’s men that hem him in.

Is it too late? One fierce blow at the unsuspecting horseman at his side, one cry to his French troops, one desperate charge upon the unready lines before him, and these rebellious Barons might rue the day they dared to thwart his plans! A bolder hand might have turned the game even at this point. Had it been a Richard [the Lionheart] here! The cup of liberty might have been dashed from England’s lips, and the taste of freedom held back for a hundred years.

But the heart of King John sinks before the stern faces of the English fighting men, and the arm of King John drops back onto his rein, and he dismounts and takes his seat in the foremost barge. And the Barons follow in, with each mailed hand upon the sword-hilt, and the word is given to let go.

Slowly the heavy, bright-decked barges leave the shore of Runnymede. Slowly against the swift current they work their ponderous way, till, with a low grumble, they grate against the bank of the little island that from this day will bear the name of Magna Charta Island. And King John has stepped upon the shore, and we wait in breathless silence till a great shout cleaves the air and the great cornerstone in England’s temple of liberty has, now we know, been firmly laid.

I suggested to my visitor – a lawyer trained at an eminent school – that he and his comrades draw up a Charter of Liberties and circulate it far and wide. When a “tipping point” is reached and a mass of ordinary people are fired by the idea, then “just do it.”

He paused to ask whether I would like to come aboard his “platform” and engage in public politics. I responded with these lines from an old song:

The doer and the thinker,

No allowance for the other...

Cronies Cannot Rescue Our The State From Collapse

In yesterday's post, I rubbished an article in the ToI by Rahul Bajaj that concluded thus:

In the final analysis, India's growth process under a democratic government is a sustainable, humane and just path to development. 

I also quoted his praise of our village panchayats. This, while his own city, Poona, is a shambles.

Today, I would like to place before my reader an article in Tehelka on the State-owned nuclear power plant due to come up in Jaitapur, on the Konkan coast just north of Goa, that has also received environmental clearances from Nude Elly. The article says that elected personnel of 10 village panchayats in the area have resigned in protest against this nuclear power plant. In all, 90 democratically elected local representatives have resigned. They also boycotted a meeting called by the Chief Minister of Maharashtra. They are demanding a local referendum on the project. They want that their lands, which have been "forcibly acquired," should be returned to them. The really troubling fact is that our The State is responding with police repression:

"The locals are being treated as hardened criminals," alleges Adwait Pednekar of the Konkan Bachao Samiti. "Externment orders and Section 37(3), (1), 144 (unlawful assembly) have been constantly promulgated in the area to prevent exercise of democratic rights.

Is this the "sustainable, humane and just path to development" Bajaj is hallucinating about? Is this "local self-government"? Bajaj is an MP. And this is Maharashtra, where he lives, and where his factories are located. In my book, this is nothing but tyranny. This is the Predatory State.

In yesterday's post, I also wrote about an "Open Letter to India's Leaders" signed by 14 of India's economic elites. Today, I am pleased to provide a link to that letter, which has been published in Outlook. After reading the letter, I am in full agreement with Shekhar Gupta's assessment of it that I quoted yesterday: it is full of "platitudes." In other words, like the Rahul Bajaj article, this too is nothing but pure bull.

To begin with, this Group of 14 say they "are concerned with the general deterioration in the overall value system of the nation, but have abiding belief and commitment in India’s potential and prospects as a successful democracy." In the next paragraph, they add:

What we are deeply worried about is not to allow India’s huge growth potential and poverty alleviation challenges to be diluted or digressed from, and which would be a great loss, especially to the poor and the dispossessed.

What are these "poverty alleviation challenges"? More welfare? NREGA and all that bull? Purchasing votes with more funny money? In yesterday's post I discussed the doublespeak of one of the signatories, a former Governor of the Reserve Bank of India, Bimal Jalan. There are two other bankers in this Group of 14 - N Vaghul and Deepak Parekh. The "great loss to the poor and the dispossessed" is inflation. And they are being "dispossessed" because they have no right to Property - which is "possession." What humbug!

The Group of 14 cronies then list out their suggestions: More regulatory bodies - and the language is fantastic: "creation of genuinely independent and constitutionally constituted regulatory bodies, manned by persons who are judicially trained in the concerned field." Is the RBI "independent"? Is the Supreme Court? What about the "apolitical" IAS or IPS? What about regulatory bodies in telecom, civil aviation and environment? They are calling for a "new dirigisme."This means more bureaucracy, more red tape, more government - and hence, more corruption. But cronies never favour Liberty and laissez faire - for obvious reasons.

The letter then lists out their major concerns: corruption, environment, a "governance deficit" (not the Budget deficit, mind you) - and their only suggestion is Ombudsmen (Lok Ayuktas).

As with Rahul Bajaj, this Group of 14 never utter the words Liberty and Property. They never mention the idea of urban self-government - which is where we Indians are really getting screwed. They never mention roads. They never use the word "privatisation" - which alone can deliver us electricity.

As I said yesterday, these are all "cronies." They are engaging public opinion in order to hoodwink the public, to cover up the real deficit, to offer false solutions, and to evade mentioning the real ones. As three of them are bankers, they ought to know that Property solves the "mystery of Capital" - for the poor. Parekh, in fact, is a "housing finance" banker. Just a few days ago, I wrote about how the Chief Economist of Parekh's HDFC Bank was hoodwinking public opinion on inflation, by failing to mention money supply increases are the only cause.

These cronies, these accomplices in tyranny and plunder, live in cloudcuckooland. This becomes obvious when you read this sentence in the opening paragraph of their Open Letter:

We are a fraction of a very large number of Indians who, we believe, share our hopes and aspirations but have no means to channel their views and opinions in India’s public domain.

Thank goodness for blogs, and the Internet, Tweeter, Facebook and all the rest. We no longer have to "channel" our opinions via the corporate media.

The real "hopes and aspirations" of this Group of 14 cronies lie in our The State - in funny money and credit creation. In protectionism. In legal plunder of all kinds. In regulatory bodies staffed by the bureaucracy.

Further, their phony concern for the "poor and the dispossessed" is all about "poverty alleviation" - which is welfare that will be administered by IAS cronies. One of the 14 is Anu Aga of Thermax, who is a member of the National Advisory Council attached to Sonia Gandhi that is pressing the case for "universal food security." All these are intended to increase the size of the Budget - and "empower" the bureaucracy with tonnes of funny money. The political intention is to purchase the votes of the poor.

The article by Rahul Bajaj as well as this Open Letter show signs of desperation; but the fact remains that these "platitudes" - as Shekhar Gupta called them - are not going to impress anyone. Poor farmers all over the country have woken up to their rights to Property - especially after Singur and Nadigram. And now Jaitapur will explode on the face of The State - just you wait and see. 

Inflation is harsh reality too. I was immensely delighted to read a piece ridiculing montek's take that inflation is caused by prosperity. This liar's pants are verily on fire. Hooray!

The undeniable fact is that our The State is tottering. Manmohan has fallen off his high perch. Sonia and Rahul are zeroes. The BJP is an ugly joke. The Communists are being slaughtered - at least in Bengal. The crony media stands exposed. Army generals and even Supreme Court judges have been found corrupt. There have been too many corruption scandals in too short a time.

What can we ordinary people do? Well, a fellow interested in activism called on me a few days ago, and I gave him some ideas. I will discuss these in my post of tomorrow. Stay tuned.

The Drunken Judge... and other creeps

"The hanging judge was sober, he hadn't had a drink," sang Dylan - but this Supreme Court judge must have been punch drunk, on some cheap hooch, that too, for a sonofabitch who ought to have been hanged, along with all his accomplices, got let off. I am speaking of Dara Singh who, in 1999, more than a decade ago, murdered the Christian missionary Graham Staines and his two little boys in the most grisly manner - by burning them alive. 

The lower court had sentenced him to death, but appeals to higher courts went to judges who were high as well - on hooch.

Dara Singh and his gang are part of the Bajrang Dal - an off-shoot of the BJP. This dastardly crime is "political."

The judgment is political as well - for the news contains the following extract from the verdict:

Dara Singh's intention was to teach a lesson to Graham Staines about his religious activities, namely, converting poor tribals to Christianity.

And what about the two little boys, both under the age of ten. Burnt alive?

Thus, there is a "lesson" in this creepy judgment: Hindoo goon-squads are free to kill Christian missionaries.

There are other creepy stories about the creepy BJP as well - like how their Chief Minister in Karnataka is facing prosecution on serious charges of corruption and nepotism. The Governor has sanctioned prosecution - and the creeps have resorted to rioting and arson in protest!

There is another creepy story about how the BJP "youth wing" are planning a march to Srinagar, Kashmir, to hoist the national flag in the centre of town on Republic Day. The locals don't like this flag - and the BJP cadres are all outsiders, wanting to force the flag upon them. The flag, anyway, is the flag of the CONgress. In tiny Switzerland, every canton flies its own flag. There are 26 cantons - and 26 flags. The BJP claims its flag-hoisting is about "patriotism." I think patriotism by force is as creepy as creepy can get.

There is creepy news about the CONgress too today - and this is about the Youth Congress. The story reveals how most of their leaders are criminals, or involved in criminal activities. As the proverb goes, "A fish rots from the head." At the head is the Great Educator.

While creeps abound in the system, so do cronies - none greater than Rahul Bajaj. He is one of India's richest men - and now a Rajya Sabha MP. He is also chairman of the Confederation of Indian Industry (CII), a club of protectionist manufacturers. Today, he has contributed the lead article in the ToI. Titled "Just Path to Development," the article concludes in favour of continued rule by the creeps:

In the final analysis, India's growth process under a democratic government is a sustainable, humane and just path to development.

Bajaj the billionaire businessman and industry body head doesn't say that the only path to economic development lies in an economic institution - The Market. He believes that this path lies in a political agency - The State - an agency over which he wields considerable influence, an influence that has made him very rich. But I must insist that this State cannot be called "sustainable, humane and just." The Budget is certainly not "economically sustainable"; there is nothing "humane" about Army rule in Manipur and Kashmir, or State Police raj in Chattisgarh; and as for "just," we just spoke of the drunken judge who let the murderer Dara Singh off.

Rahul Bajaj lives in Poona (Pune), where his factories are also located. I have been visiting this city for many decades now, and have witnessed, with deep sorrow, its rapid deterioration with every visit. What was once a quaint little town where retirees built their little bungalows, Poona is now a hell-hole. The leading citizens of this city couldn't care less - and the long-time CONgress MP from Poona is none other than Suresh Kalmadi of CWG mega-corruption fame. Bajaj himself sits in Parliament in Nude Elly - cultivating political influence. It is noteworthy that in his article praising India's centralised democracy, he says not a word about civic freedom, about local self-government in cities and towns. Instead, he devotes an entire paragraph to praising panchayati raj in villages:

Participatory governance is most evident in local self-government at the village level, termed 'panchayat'. Across the country, several hundred thousand panchayats represent local voters, develop plans for social and economic development, manage funds and undertake projects. As per the Constitution of India, they are able to directly work in 29 demarcated areas. A key feature is that the government has mandated one-third of panchayat members to be women, with the result that one million women have been thus empowered. Initially viewed with suspicion, women panchayat members have taken up the development agenda in a committed manner, relevant to their own particular electorates.

Perhaps Bajaj should be asked to quit city living and migrate to a village. And become a panchayat pradhan. Poona - like all the other devastated cities and towns throughout this vast sub-continent - needs a good Mayor, that's for sure.

Do read the entire article by Bajaj, CII boss, and laugh out loud at all the bull it contains. It is nothing but pure bull - from beginning to end.

There is more bull from ultra-rich Indian businessmen in the news today. Fourteen of them have penned an "Open letter to India's leaders" - on which Shekhar Gupta, editor of the Express, has devoted his weekly column. It seems, quite predictably, that the Open Letter lacks guts. Gupta says:

Of course you could fault the signatories of this open letter for being unwilling to wound and petrified (perish the thought, actually) to strike. That is why the letter, signed by some of our most respected and powerful citizens, is so unspecific in what it is complaining about, or the actions they want taken in redress. It is full of platitudes...

This cannot be called Capitalism. But then, we remain a socialist country - and India's super rich like it that way. Another super-rich Poona businessperson is named as signatory to this Open Letter in this news report: Anu Aga of Thermax. Interestingly, she is also involved in CONgress politics in Nude Elly, as a member of the National Advisory Council that advises Sonia Gandhi to spend billions funding a "right to food." She too is not bothered about the deterioration of her own city. Does anyone in Poona, however poor, require food from The State in Nude Elly? Or do they manage just fine? But Aga's mind is on some remote village in the boondocks. Or maybe she too is cultivating political influence like all the others.

Among the signatories to the Open Letter is a former Governor of the Reserve Bank of India, Bimal Jalan, who was a Rajya Sabha MP as well. The report concludes with these remarks attributed to him:

Take inflation. We have been told for several months that it will come down but hasn’t. Then we were told that the government is not responsible for inflation. So, it is difficult to find out which is the cause and which is the effect.

Bimal Jalan has served two full terms as Governor of RBI. He received his "education" at Oxford and Cambridge - and has authored half-a-dozen books on the problems and prospects facing the Indian economy. He has not heard of the "quantity theory of money"! Or he is bullshitting. Interestingly, Wikipedia mentions that the 1000 rupee note was introduced during his term - and that is a sign of inflation. The RBI caused it. It is for this very reason that coins below 1 rupee have been recently withdrawn. There will soon be a 10,000 rupee note, I bet, and a 100 rupee coin too - while RBI governors will mouth "platitudes" like the one above.

The creepy thing about the inflation being perpetrated is that it creeps along slowly and steadily - 8 per cent, 10 per cent, 12 per cent - and is not noticed. It is "creeping inflation." Creeps are perpetrating this. As Ludwig von Mises pointed out:

The most important thing to remember is that inflation is not an act of God, that inflation is not a catastrophe of the elements or a disease that comes like the plague. Inflation is a policy.

That is, inflationISM is going on - deliberately. It is sneaky, immoral, cruel and anti-democratic. I have an earlier post on this that I recommend.

The news report on the Open Letter that Bimal Jalan, Anu Aga, and others have signed, addressed to "India's Leaders," is titled "India Inc. for Tough Governance." But the signatories are all weak! They want cha(m)cha manmohan s gandhi to take "tough decisions"! Like what? Hang a bunch of murderers, maybe? Give the hangman some "work," eh, chacha? We can't have hangmen hanging around, can we?

Get real, dudes. Forget about Nude Elly. Fix your own cities and towns. And fight for freedom - not "tough governance," whatever that means.

"If I were a rich man," sang the street-sweeper Alfred Dolittle - and a happy song it was, too. I'm glad I am not rich. Better to be poor and kicking ass than one of these super-rich ass-kissers.

Sick, Sicker, Sickest

Air India is "sick" in the sense that it has accumulated losses of Rs. 5000 crore (50 billion). But the politicians who run it want more and more money put in - and this money is to come from our The State, which is itself in serious deficit. Sick State running sick companies. Our "common loss." 

Praful Patel of the NCP, the minister for civil aviation on whom I have a previous post, has been promoted in the cabinet reshuffle of yesterday. He is now minister for heavy industries and public enterprises - and, in his first public statement on taking charge, has insisted that "Air India should not be declared sick." He wants our The State to pour more cash into Air India. He thinks it can be restored to good financial health - by the new minister in charge of civil aviation. Praful Patel will now have 100 or so other "sick" public enterprises to run - and we can be sure that he will demand bailouts from the Treasury for them all. This is what the CONgress calls "socialism": politicians and bureaucrats running businesses. Since the very idea is sick, all these businesses are sick.

Vayalar Ravi, a CONgress trade unionist from Kerala, is the new minister for civil aviation. In this interview, he says Air India will be his "top priority," and that he wants to bring back its "lost glory." Actually, this short-lived glory of Air India occurred because of private management - because JRD Tata, a "pioneer aviator" himself, looked after its affairs personally. Under State ownership, ministers come and go, each seeking short-term personal gains. Just as the nationalisation of Air India was "legal plunder," State ownership and management of the airline is more and more plunder. Sick idea. Sick company. Sick ministers.

Air India - and all the other PSUs - are neither capitalism nor socialism; they are "cronyism." Every single person involved in them, from minister to peon, is a crony of The State. They are not allies in business; they are allies in plunder. They give credence to Murray Rothbard's dictum: "The State is a gang of thieves writ large." They make me sick.

I watched Vayalar Ravi on television last night, being interviewed by Vikram Chandra of NDTV. As the minister went on and on mouthing socialist inanities, Chandra went on and on expressing complete agreement. Indeed, Chandra addressed the minister as "Sir" - that too, at least fifteen times in two minutes. His prime time show is called "The Big Fight." But when it comes to ministers, he doesn't fight at all. This "crony journalism" is what I find sicker. Our media is full of it.

And now - the sickest: the "crony academic."

Pratap Bhanu Mehta is a former professor of philosophy, law and governance at Jawaharlal Nehru University. Now, he chairs The Centre for Policy Research, a State-owned so-called "think-tank." He is a long-time columnist of The Indian Express - and his column today is on "food security." He writes, in his opening paragraph:

It is a scandal that after two decades of high growth, India still does not make adequate nutrition available to large sections of the population. There is simply no financial, technological or production related reason why this should be so. 

So, just as Praful Patel and Vayalar Ravi think that there is an inexhaustible fund they can tap to fund all their socialist schemes, Mehta too sees no financial constraints to obtaining "food security." We can safely assume that he is a Keynesian funny money man - and he must be so, because Wikipedia says he was "educated" at Oxford and Princeton - in philosophy, politics and economics. Ben Bernanke is also from Princeton, a long time chairman of their Economics department (see my old post on his academic credentials). Paul Krugman, the Keynesian Nobel laureate in Economics, is from Princeton too.

Mehta, the Keynesian funny money man who recognises no financial constraints facing The State, thus makes the case for "universalisation" of his food security scheme. He also looks favourably at the possibility of "cash transfers" - all the cash being more funny money, of course. So, when faced with the inevitable consequence of inflation, he displays the real motive behind this column: the desire to sow the seeds of confusion in public opinion, to poison the air. He writes:

The arguments over the causes of inflation — supply bottlenecks, currency policy, global trends, monetary policy, weather, hoarding, speculative investment, deficit spending — no longer serve analytical clarity. They have become contrivances to avoid the core issue: there is a serious governance deficit that will stymie both public and private provisioning.

Mehta's column is titled "A platter of blather." The above is nothing but blather. Pure blather. Every Keynesian knows that money supply increases cause a rise in all prices: the "quantity theory of money." This is the basis of all their "monetary policy."

However, midway through his piece, Mehta, former professor of philosophy, law and governance at JNU, asks two questions:

What the hell CAN government do? Why does it even exist?

 Well, the government exists because of the Constitution. 

And, since government is nothing but force - compulsion, coercion and legislation employed by tax-collectors, cops, judges, jailors and executioners - to all sensible people it makes eminent sense to direct this force very carefully. The bigger the role of The State, the greater the use of force. Thus, to keep Air India and all the loss-making PSUs afloat, force will be applied: taxation. So too with Mehta's "universal food security." Thus, it is our socialist Constitution that is the root of all evil. It has unleashed upon us an "unlimited State." Unlimited taxation, unlimited borrowing, unlimited funny money, unlimited interventionism. That is, unlimited tyranny. Unlimited plunder.

Mehta finds the absence of food security a "scandal." To me, on the other hand, our unsafe streets on which 200,000 pedestrians and cyclists are killed every year is the real "insecurity scandal." I find it a scandal that the Supreme Court has said the "criminal justice system is not working." Of course, all this "infusion" of public finds into loss-making PSUs like Air India is also a scandal - as is all the funny money being printed to fund all this shit.

"What the hell CAN government do?" asks Mehta. Well, one thing it can do very well is plunder.

So let us think of a Constitution of India framed by people like Professor Pratap Bhanu Mehta. It will surely proceed like this:

WE, THE PEOPLE OF INDIA, having solemnly resolved to constitute India into a SOVEREIGN, SOCIALIST, SECULAR, DEMOCRATIC REPUBLIC and to secure to all its citizens:

FOOD - the government is to ensure universal provision of food,

PROFIT - the government is to run all businesses,

WORK - the government is to employ us all,

EDUCATION - the government is to cultivate our minds,

MONEY - the government is to produce all the money our society needs,

CREDIT - the government is to provide all of us credit, and that too, at very low rates of interest,

HOUSING - the government will ensure all of us are well housed,

SOBRIETY - the government is to ensure none are high,

TIMELY REST - the government is to ensure all establishments close at a decent hour, thereby playing Wee Willie Winkie to us all,

UNSEXINESS - the government is to prohibit anything and everything that makes us horny,

etc. etc....

IN OUR CONSTITUENT ASSEMBLY this twenty first day of January, 2011, do HEREBY ADOPT, ENACT AND GIVE TO OURSELVES THIS CONSTITUTION.

Sounds crazy? Or does it sound sick?

Then, what the fuck is the reason why governments are created?

One answer: To secure our lives, our properties, and to thereby ensure our LIBERTY.

And it is precisely these that are not happening. We are dying on the streets, our properties are not secure, and we possess no liberty at all.

Think about it.

The Real Plunderers

Our Supreme Court, the "committed judiciary" of the CONgress, has accused tax dodgers who have stashed their wealth abroad of a very grave crime - "plunder of the nation." Complete nonsense, of course. A tax dodger cheats The State and not the nation - and, since this State cheats everyone anyway, this is really a "good thing," for it preserves Capital for future investments. Everyone benefits from these future investments - goods are produced, jobs are created, and what not. If our The State had got hold of this money, it would have been "consumed": NREGA, CWG, etc. Capital consumption makes everyone poorer. It is the road to de-civilisation. God bless the tax dodger.

Yet, there are forces at work that are in reality plundering the nation - and these are the forces of inflationism. Speaking of inflationism, one writer made a powerful comment the other day:

Never in the history of Man has so much been stolen from so many by so few.

He was referring to the US Fed. Gold was $20 an ounce when the US Fed was established in 1913. It is over $1300 an ounce now. It is not that the value of gold has risen; rather, it is the value of the US Fed's paper dollar that has depreciated. All those who saved in dollars have lost. The US Fed has, because of its privileged position as the issuer of the world's reserve currency, "exported inflation" all over the world. Plunder of the World! So, let's play it again, Sam:

Never in the history of Man has so much been stolen from so many by so few.

The USSA also has a Supreme Court. But theirs too is a "committed judiciary" - committed, that is, to the notion of "legal tender." The idea of legal tender is an idea of "State money" that is FORCED upon the people, to be used in each and every transaction. It is legal tender that enables universal plunder. If State force is not used, everyone would refuse the depreciating currency and use others of stable value. Like gold. Or silver.

Below is a very brief history of how the Supreme Court of the USSA committed itself to State money and legal tender. This is from Hans Sennholz's Money and Freedom, a monograph published in 1985. Sennholz was another of the many gems to emerge from Ludwig von Mises' New York seminars. Here is Sennholz on legal tender in the USSA and the dubious role played by their Supreme Court:

The legal tender evil has come to the United States in periods of, and in the name of, national emergencies. Between 1775 and 1779 the Continental Congress issued some $241 million of currency to finance the Revolution. It did not itself declare the bills legal tender, but urged the states to give them legal tender standing. The states complied without demurring.

Depreciation of the Continental paper dollar set in as early as 1776. To derive any purchasing power from its issuance, the Congress printed Continental dollars faster and faster. Its first issuance amounted to a mere $2 million of bills of credit; in 1779, government printing presses turned out $140 million. By 1780 the specie value of the Continental dollar had fallen to three cents, and was still declining. Congress resolved to print no more money, and to finance its expenditures by other means, only when the cost of printing notes was almost higher than their value. By that time, the people refused to accept any Continental dollars, which in the end forced the states to repeal their legal tender laws.

During the Civil War, the Lincoln administration issued some $450 million of Treasury notes and granted them the quality of legal tender. A series of legal cases reached the Supreme Court between 1868 and 1870. The Court promptly ruled that legal tender provisions were unconstitutional. While more cases were pending, Congress raised the membership of the Supreme Court from seven to nine; President Grant, making the appointments, selected only those justices known to favour the constitutionality of legal tender, thereby creating a preestablished majority for legal tender. It was a foregone conclusion therefore that the Court would uphold legal tender legislation.

In 1933, the federal government expropriated the people's gold coins and bestowed legal tender force on all Federal Reserve notes and US Treasury currency. In every case brought before the Supreme Court, the justices confirmed the money powers claimed by the government.

On June 5, 1933, a Joint Congressional Resolution voided gold clauses in all contracts, public and private. In 1935, the Supreme Court acclaimed and approved the Resolution. In the words of Chief Justice Hughes, "Parties cannot remove their transactions from the reach of dominant constitutional power by making contracts about them." With a stroke of a pen, the Court permitted every debtor to defraud his creditors, and granted government the privilege of robbing its creditors under the pretext of paying them - all in the name of the Constitution.

Sennholz concludes with the fond hope that some day in the future "five other justices will read the Constitution and arrive at a different conclusion."

Legal tender allows The State to issue paper notes monopolistically and force them upon the people. This permits inflationism - which is "legal plunder," for it allows The State to appropriate private wealth without the consent, or even the knowledge, of those who are plundered. Through the issue of more and more currency notes fresh off its presses, The State can buy up all the goods and services it needs, and finance all its political schemes, from war to welfare. This funny money is the "root of all evil" - for it finances The State. Hence, the tax dodger does well to preserve his own Capital. Black money is good money - preserved from The State. On the other hand, it is funny money that is bad money - produced by The State, and forced upon us as "legal tender": monopoly.

Every single monopoly - of the past as well as the present - has been imposed on the people through the misuse of State force. Free markets can never ever result in monopoly. Tell your Economics professor that - and point to the funny money as evidence.

There is only one way out of this: The spending of The State must be drastically slashed. No more subsidies. No more doles. No more bailouts of "misproductive" PSUs like Air India. No more "re-capitalisation" of banks. No more "overstaffing" in the bureaucracy.

And, most certainly, no more "welfare."

Niranjan Rajadhyaksha, editor of Mint, seems to have finally arrived at this conclusion. He has just written that all this is welfare championed by Sonia and cha(m)cha manmohan is backfiring - because it is being financed by inflationary means:

The motives behind the schemes to provide guaranteed jobs and food cannot be questioned. But the road to hell is often paved with good intentions. These schemes will push up food prices and also harm public finances.

I completely disagree with Rajadhyaksha's assertion that the motives behind all these welfare schemes like NREGA "cannot be questioned." They can - and they must. If the motive is to win votes, it is backfiring because of inflation. But should politicians be allowed to spend so recklessly, jeopardising the future, in order to purchase votes?

Rajadhyaksha writes of the "Rangarajan panel" that has tendered advice on the matter: the advice being to "water down" all the welfare. It turns out that C Rangarajan chairs the Economic Advisory Council to the Government of India - and, like chacha himself,  this Rangarajan is a former Governor of the Reserve Bank of India. Funny money men to the rescue of The State!

The inflation currently raging also shows that the "cabinet reshuffle" of today is total and complete nonsense. What is required is slashing the number of ministers down to three or four, and no more. What chacha manmohan has done is to INCREASE the number of ministers!

Our chacha is a peculiar "economist" in that he has no desire to "economise." He wants to go on increasing State expenditure. He wants to employ more and more "tax parasites." The more the merrier. All aboard The State. No inflationist has ever cared about the limitations of the Budget. This is the evil of legal tender, which is nothing but legal plunder.

As for our Supreme Court - we have just seen how in the USSA, the Montesquieu doctrine of "separation of powers" between the executive, the legislature and the judiciary was rendered meaningless. The same holds true in our case. When justices are appointed by politicians, no separation of powers is possible, and everything is politicised. Our Supreme Court and all the High Courts "play politics" regularly - socialistic politics, that is - as in the recent case pertaining to the Representation of People Act, which disallows all non-socialist parties from the fray. In my post on that biased and unjust decision, I wrote that the Supreme Court was being "patriotic" - that it too was being "loyal" to the CONgress, its hoary dynasty, and its "socialism."

As far as funny money is concerned, our Supreme Court has been an accomplice. Recall the Foreign Exchange Regulation Act (FERA) - and the Enforcement Directorate, the "delegated despotism" it established, the vicious Rottweiler of The State? FERA was never struck down as unconstitutional. But then, everything about socialism is "legal plunder" - like nationalisation, land acquisition, and, of course, inflation.

Judges are supposed to be "learned." But no socialist has ever been learned. The Supreme Court's blindness to real plunder, and its patently false accusation against the tax dodger, finds an echo in this column by the Communist Party politburo member and Rajya Sabha MP, Sitaram Yechury, a product of Delhi's Jawaharlal Nehru University. Writing on inflation, this communist (who is ideologically trained to despise Private Property) writes:

It is this speculative trading that is relentlessly pushing up the prices of all essential commodities, particularly food prices.

He wants to ban all forward markets. He sees traders and businessmen as evil - the cause of inflation. He sees State power as the solution. He wants Parliament to pass another nasty piece of legislation banning voluntary trades. In reality, speculation lessens volatility and fluctuations in prices; it does not exacerbate them.

Yechury is a Marxist - but, unlike Marx, he is also a Keynesian. He wants to "represent the workers" - but he also wants to cheat them, through inflationism and "legal tender."

The judges of our Supreme Court are of similar "thinking." Unlearned.

Sex, Drugs & Rock-n-Roll

The latest issue of Outlook is about sex in India these days. They undertook a survey and concluded that Indians are now "making whoopee." While this is about today, let me take my reader back to ancient times, when the Kamasutra was written. The following is from AL Basham's The Wonder That Was India, from the section "Sexual relations":

Of all legitimate pleasures sexual pleasure was thought to be the best.

The literature of Hindu India, both religious and secular, is full of sexual allusions, sexual symbolism, and passages of frank eroticism. The preoccupation with such themes increased in the Middle Ages, when the process of cosmic creation was figured as the union of god and goddess, and images of closely embracing couples (maithuna) were carved on the walls of temples. Some religious sects even introduced ritual intercourse as part of their cult and a potent aid to salvation. But the exaggerated sexual religiosity of the later Middle Ages was only an expression of the vigorous sexuality which was to be found in Indian social life at all times....

The Indian passion for classification, though it did not result in the emergence of experimental science, led to the development of rather pedantic schools on many aspects of human activity, including sexual relations. On this topic, a number of textbooks survive, the most important and earliest of which is the Kamasutra, attributed to the sage Vatsyayana.... This remarkable work gives, as may be imagined, detailed instructions on erotic technique, aphrodisiac recipes and charms, and incidentally much valuable information about the life of the ancient Indian. From texts such as this, and from many passages in courtly literature, we may learn much about the sexual life of the upper classes.

Sexuality was not looked on as a mere vent for the animal passions of the male, but as a refined mutual relationship for the satisfaction of both parties. The sophisticated townsman for whom the Kamasutra was written was advised to consider the satisfaction of his mistress as well as his own, for she was as passionate as himself, and it was even said by some that her pleasure in sex was greater than his. Loveplay was manifold and thoroughly classified; thus, the Kamasutra defines no less than sixteen types of kiss. There was much tenderness in lovemaking, though it often culminated in very violent embraces; it was a favourite poetic convention to describe lovers of both sexes, whether married or single, as displaying the tokens of their passion to their confidential friends, in the form of the marks of nails and teeth.

So they were making whoopee too! As Leonard Cohen puts it, "Many loved before us, I know that we are not new."

In the "free India" ruled by the CONgress, it was their The State that also clamped upon society a huge amount of sexual repression. Whereas, as Basham notes with due wonder, the Kamasutra defines no less than sixteen types of kiss," no kissing is allowed in Indian films! The nautch girl is banned - so let's forget about nudity. Playboy is also  banned here.

It is not that in ancient India sex was everything. Kama came third - after dharma and artha. Modern India is all about a spurious sexual morality that ignores the more important "economic morality." It is all a very ugly kind of hypocrisy: an utterly immoral and depraved power elite who resent all the happy humpers. In ancient India, the courtesan was respected, even honoured. Today, if you visit the red-light district of any Indian city, you feel nothing but deep sorrow for those who work there. The State calls prostitution "immoral traffic" - but they cannot manage road traffic, and over 2,00,000 pedestrians and cyclists are killed on our unsafe streets every year.

In modern India, because of our The State, there is no chudai, only khudai. They dig everywhere. Dig dig dig. Every city is dug up. To the Bengali, for many decades now, KMDA stands for khurchi mati, dekhbe esho - that is, "come and watch us digging mud" - and not Kolkata Metropolitan Development Authority. With the NREGA, the villages are all dug up too. Fucking hell!

Let us now turn to drugs. In ancient India, people enjoyed getting high - and there were many highs. The soma of the ancients was a drink prepared from cannabis. Not that alcohol was not in use: In the Arthashastra, there is a long list of alcoholic drinks - and a further list of alcoholic drinks that were imported. This was no Old Monk(ey) country. As for opium use, it was sacred among the warriors - they used it ceremonially before battle because of its anesthetising effects, which protected them from pain in case of injury.

The Brits "studied the happiness" of their Indian subjects. A Royal Hemp Drug Commission was appointed in the late 19th century to look into our usage of ganja, charas and bhang. These were unknown in Britain, while in India their use was "widespread." The Commission looked into three aspects of hemp drug use: whether they damaged the health, whether they damaged the mind, and whether they caused criminality. On all three counts they voted "not guilty" - and we were left free to get stoned. Not so our own countrymen - these kallus who took over from the goras. The possession, cultivation and sale of ganja, charas and bhang are now "non bailable offences" carrying a minimum sentence of 10 years in prison! Fucking hell, once again.

Finally, let us turn to rock-n-roll. These days, very big stars occasionally hold concerts in Indian cities. Roger Waters played here some years ago. Bryan Adams is coming soon. But what about our own rockers? They have no places to perform live before local audiences. There are so many State-imposed restrictions on nightlife that extremely talented musicians live dirt poor - or take up other jobs to survive. The amount of talent in this area is truly phenomenal - we now have an Indian edition of Rolling Stone magazine, with many pages devoted to local rock bands. It is The State that is killing all the music.

So that's modern India: No Sex, No Drugs, No Rock-n-Roll - only repression, legislation, corruption, and lots and lots of digging.

Run, rabbit, run,

Dig that hole,

Forget the sun,

When at last your work is done,

Don't stop,

It's time to dig another one.

Fucking hell.

Democracy Is Done For

Hans-Hermann Hoppe's Democracy: The God that Failed is perhaps new, but Ludwig von Mises predicted this god's demise long back, when he wrote thus, in 1940, in Bureaucracy:

Representative democracy cannot subsist if a great part of the voters are on the government pay roll. If the members of parliament no longer consider themselves mandatories of the taxpayers but deputies of those receiving salaries, wages, subsidies, doles, and other benefits from the treasury, democracy is done for.

The question to ask is: Who or what do you "represent"? In India, it is undoubtedly true that our Great Leader, cha(m)cha manmohan s gandhi, represents "those receiving salaries, wages, subsidies, doles, and other benefits from the treasury" - and these include Air India. As far as the taxpayers are concerned, chacha's only desire is to screw them further - education tax, VAT, GST, and, let us never forget, the "inflation tax." Of course, he himself has never been "elected by the people." He lost the Lok Sabha elections from South Delhi - and entered Parliament by the back door (Rajya Sabha: "indirect election") from Assam, of all places for a Sardar. He represents Sonia Gandhi alright - but does she "represent" Rae Bareilly? Or is this some kind of "pocket borough"? No one represents the taxpayers - although the rallying cry of democracy used to be "no taxation without representation." 

In India, no one represents any city or town either. I was mortified to read that Jairam Ramesh, Central State minister for the environment, has ordered the demolition of the Adarsh building in Mumbai - while he himself is a Rajya Sabha MP from Andhra Pradesh. Who represents Mumbai? Certainly not Sharad Pawar, either. What is the point in electing MPs and sending them to far away Nude Elly to represent "the poor"? And that too, falsely.

Of course, the poor are being cheated. As Mises said, what Lord Keynes was really doing was "cheating the workers." But it is Keynesian funny money that has really destroyed democracy, for it has provided the means necessary to fund all the giveaways of modern, pseudo-democratic states. With unlimited funny money, those in charge can buy all the support they need -  not only in Parliament, but also in academia, and in the media. Crony capitalists are surely less harmful than crony academics and journalists.

Now for the good news: All this funny money will end in the near future. I have just read a very interesting confidential report prepared by a prestigious financial advisory that says, among other things, that "the Euro is finished." And Europe is where the "welfare state" comes from. The report says Germany is headed for a "constitutional crisis." The report says lots of things about the US dollar and Ben Bernanke - none of it very new to those who regularly read LewRockwell.com. At least the USSA has Ron Paul - and I wish that man well. I read that inflation is raging in China - thanks to their great big "stimulus" in 2008.

What the report predicts is that there will soon be a huge political backlash against funny money. I pray for that day to come soon. Limited government must mean limited by the Budget - that is, tax revenues. No more funny money. No more borrowing. No more "inflation tax." No more "buying support." Represent the taxpayer faithfully - or fuck off!

The report I referred to berates all the crony academics who are all invariably Keynesian - like our chacha. After reading the report, it struck me that "higher education" is what has really destroyed minds - all over the world. Consider the Englishman of medieval times, lamenting the inevitability of "death and taxes." Wouldn't this fellow laugh out loud if someone told him that his sovereign, while spending his revenue, was providing a "boost to aggregate demand"? Wouldn't this fellow think it inconceivable that, with his taxes, his sovereign would "help the poor"? 

One of the greatest bestsellers of Victorian England was Samuel Smiles' Self-Help. Translated into Japanese in the 1860s, it fired the Japs in their catch-up with the West. In Victorian England, this book was on every bookshelf - right next to the Holy Bible. Samuel Smiles was a "moralist" - and the book tells the story of innumerable great men of humble origin who made in big in every conceivable walk of life. Allow me to quote the opening paragraphs:

Heaven helps those who help themselves is a well-tried maxim, embodying in a small compass the results of vast human experience. The spirit of self-help is the root of all genuine growth in the individual; and, exhibited in the lives of many, it constitutes the true source of national vigour and strength. Help from without is often enfeebling in its effects, but help from within invariably invigorates. Whatever is done for men or classes, to a certain extent takes away the stimulus and necessity of doing for themselves; and where men are subjected to over-guidance and over-government, the inevitable tendency is to render them comparatively helpless.

Even the best institutions can give a man no active help. Perhaps the most they can do is to leave him free to develop himself and improve his individual condition. But in all times men have been prone to believe that their happiness and well-being were to be secured by means of institutions rather than by their own conduct. Hence the value of legislation as an agent in human advancement has usually been much overestimated. Moreover, it is everyday becoming more clearly understood that the function of Government is negative and restrictive rather than positive and active; being resolvable principally into protection – protection of life, liberty and property. Laws, wisely administered, will secure men in the enjoyment of the fruits of their labour, whether of mind or body, at a comparatively small personal sacrifice; but no laws, however stringent, can make the idle industrious, the thriftless provident, or the drunken sober. Such reforms can only be effected by means of individual actions, economy, and self-denial; by better habits, rather than by greater rights.

Poor immigrants fleeing religious persecution in Europe built America - because of Liberty, and self-help. The socialist "New Deal" came only in 1933. There is no nation that has been built through doles from the State. Rather, many nations have been destroyed - like Sweden. The spirit of America has been destroyed by the Welfare-Warfare State of the USSA - and its paper dollar.

Interestingly, for Austrian school economists, the word "dollar" comes from a Hapsburg gold coin, the Reichsthaler - called "thaler" for short - which became the most popular coin in old America!

British India had no welfare at all - except during famines. Below is a quote from Charles Metcalfe - to whom we owe the institution of the Free Press - that says a great deal about these aliens who ruled our land so well:

Our dominion in India is by conquest; it is naturally disgusting to the inhabitants…. It is our positive duty to render them justice, to respect and protect their rights, and to study their happiness. By the performance of this duty, we may allay and keep dormant their innate disaffection; but the expectation of purchasing their cordial attachment by gratuitous alienations of public revenue would be a vain delusion.

What our socialist-democrats with all their funny money are doing is nothing but "purchasing cordial attachment by gratuitous alienations of public revenue." As far as the "positive duty to render them justice, to respect and protect their rights, and to study their happiness" they couldn't care less. Ganja, charas and opium were not illegal in British India - nor was the nautch girl. There were no parliaments passing legislation upon legislation - and none of the "delegated totalitarianism" of today. Rather, there was "happiness" - and Justice.

And then the CONgress took over. It all began in 1905, when Lord Curzon enacted the Partition of Bengal. Suddenly, the "majoritarian principle" - which is the principle of democracy - took over, with horrendous effects that continue till today. Nirad C Chaudhuri was a young man then, and he describes the ensuing chaos well in his autobiography:

Overhead there appeared to be, coinciding with the sky, an immutable sphere of justice and order, brooding sleeplessly over what was happening below. But that feeling vanished at one stroke with the coming of the nationalist agitation in 1905.

Note the word "agitation." Democratic "politics" in India even now is all about "agitation" - like Telengana. Again, CONgressmen are agitating for their own State. And the BJP-Shiv Sena are calling for a Mahasangarsh in Mumbai right now.

"Democracy is done for," as Mises said in 1940. Mises died in 1973 - the year I finished school. In 1974, I entered Delhi University to study Economics - and crony academics like chacha manmohan made sure we never read anything written by him. In any case, Mises was totally ignored in America too - as was Murray Rothbard, the most illustrious student from his New York seminars. The crony academics wanted to conceal the truth - and teach The Lie.

Yet, today, even without our willing it, it is the truth that is impossible to resist. The powerful politicians and bureaucrats, the central bankers and all the rest, might be possessed of State authority - but they cannot escape Economic Reality. The era of funny money will be over someday soon. And I wonder what will happen to Democracy.

Pandora's Box - Shut!

Three recent posts have sought to prove that the more a government "works" the greater is the harm caused to society at large. The first of these posts was on the work chacha manmohan s gandhi himself proposed to do - "we will redouble our efforts," he said - and it turns out that we would be much better off if he took a long holiday instead. The second post was on the the odd fact that chacha spends a lot of time and money "producing work" for others - the NREGA. The third such post was on Lord Curzon - a Viceroy who really "worked" - and even here it was seen that had his lordship refrained from doing so, the whole of South Asia, and perhaps the entire world, would have been much better off today. Curious, ain't it? The State as all the gook that came out of Pandora's Box?

The reason for this curious fact is not hard to find - for The State produces "bads," not "goods." This is especially true in our age of inflationism, excessive legislation, intervention and regulation. The Keynesians employ a formula to teach their view of "national income" = C + I + G. Or, Consumption + Investment + Government = National Income. Thus, for them, and all those fatally wounded by their teachings, more government spending is a good thing, and adds to national income. Government spending boosts "aggregate demand."

But do you think tax departments add to national income? What about the customs department - that keeps all the foreign goodies out of our land? Do you think armed forces add to national income? If there is a flood and The State spends a whole lot on rescue efforts and relief, does that add to national income - although, in this case, it is "good work"?

There are other kinds of work that do not add to national income - like the "work" of a burglar, for example. The more the burglar works, the more losses society suffers. This kind of work is neither "productive" nor "unproductive" - rather, it is "misproductive." Much of government work is like that, especially in our age. Bads are produced, not goods.

As for "welfare" - it has nothing to do with either "investment" or "production." It is the same with all measures of "wealth redistribution" - for nothing additional is produced, and there is no addition to national income. Indeed, production may actually decline, because with "welfare" and "redistribution" what really happens is "capital consumption." Thus, the less The State "works," the better. The PSUs are perhaps the best example. Anyone wants Air India to keep on "working"?

Ludwig von Mises nailed all the advocates of socialism when he wrote:

Socialism... is not the pioneer of a better and finer world, but the spoiler of what thousands of years of civilization have created. It does not build; it destroys. For destruction is the essence of it. It produces nothing, it only consumes what the social order based on private ownership in the means of production has created.

Socialism and Keynesianism go together. Because of the domination of Keynesian theories, all the excessive and misproductive work done by The State today is funded using fiat paper money - which is "inflationism." Reducing this "destructive work" drastically is the only way to get "sound money." We must close this Pandora's Box.

We may contrast my view above with that of the Chief Economist of HDFC Bank, published in the ToI today. Looking at the inflationary situation, he says not one word about the fact that it is caused by an increase in the money supply - and nothing else. He writes endlessly on "overheating" - and I have never heard of any such "pressure cooker theory of monetary policy." The Keynesians teach a false "quantity theory of money" as the basis of "monetary policy": MV = PT. This posits a direct relationship between the money supply (M) and the (false) "price level" (P). Since inflation penalises savers - all his depositors - he ought to be asking for cutting State expenditure: shutting down Pandora's Box. Instead, he asks for more and more "work" for The State to do!

This will not help his bank - for millions of savers are already moving out of bank deposits and into gold, silver, land, etc.: the "flight into real values." If we tread the path he wants us to, we are headed for doom - the "crack-up" of the currency.

On the other hand, if we adopt a Gold Standard - private money that The State cannot ever tamper with - inflationism will end and the poor will slowly accumulate Capital. A sound economy is not just a few big "corporates" - rather, it is millions and millions of small businesses. Sound money will allow all these small capitalists to emerge - by preserving the value of their savings. This the way out of poverty - not "welfare," which will surely entrench it forever. And only when poverty ends, will the full depth of the Indian market - one billion consumers - ever be plumbed.

Apart from this Keynesian "funny money," Pandora's Box is wide open also because of Legislation. It is the Narcotics Act that creates a Narcotics Bureau, gives it powers and a vast budget, and thereby unleashes so much "misproductive work." Similarly, the recently enacted "rights" to work, education and food "empower" bureaus - with tonnes of funny money. Legislation leads to "delegated despotism" - severing the link between Freedom and Democracy - as in the case of Mumbai's "dance bars." It also inevitably leads to gross violations of Property.

Legislation leads to another kind of tyranny - regulation. I have recently written against telecom and airline regulation - but there is so much more, at all levels, from building regulations, to bar licensing to what not. I have a recent post on a particularly odious piece of environmental legislation, the Coastal Zone Regulation Act, that condemns all who have traditionally lived by the sea to eternal poverty, while empowering a predatory bureaucracy. Similarly, the Arms Act ought to be called the No Arms Act - for it keeps us all disarmed, and therefore vulnerable to attacks from any lawless brigand, while at the same time empowering baboons.

Legislation is the tool of all interventionism. Rampant interventionism in our age has already destroyed democracy - for it has resulted in a situation by which MPs "represent" various regulated interests, and nothing else. I have another post on this phenomenon. I have also penned a column on the way out - a "private law society."

Thus, there is no need whatsoever to treat Democracy as a "holy cow." Every political theory must face critical examination. And those who render this valuable service do not perforce have to suggest an alternative. I recommend Gordon Tullock's The Vote Motive (PDF here). I also recommend PJ O'Rourke's Parliament of Whores, which you can buy in India here. Hans-Hermann Hoppe's Democracy: The God that Failed is, of course, a must read - and it is available here.

The vote is meaningless without Liberty and Property. The vote is meaningless when The State can fraudulently fund itself endlessly. The vote is also meaningless when all power is centralised - that too, in such a huge, diverse country. Central planning requires a centralised State. The Free Market does not. And the proper management of cities and towns requires "local knowledge" - not a Central ministry of urban development and its JNURRM or whatever.

All solutions lie in The Market - in Liberty. Free trade, free enterprise, free capital flows. We Indians made a huge error in 1947 by looking upon The State as the "means" to a good society; as the "solution" to every perceived ill, from poverty to illiteracy to caste. It is this error that opened Pandora's Box. Now we must close it.