The State, The Market, And Food

In yesterday's post, I presented the horror story of "education" in the prestigious Jawaharlal Nehru University (JNU) located in New Delhi, as reported by a young student. Today, I will discuss the published views of one of their "bureaucrat-professors," on an issue of great national importance: the fact that some 60,000 tonnes of foodgrain are rotting in State custody, being eaten by rats; this, while "food inflation" has been skyrocketing, and while the same State is about to legislate a "universal right to food."

The JNU don writes:

It is obvious now that the unnecessary stocking of foodgrains contributed to the upward pressure on food prices by creating an artificial scarcity and speculation on prices.

Needless to say, procurement is not in itself a problem. The problem is that the government is clueless as to what should be done once foodgrains have been procured. Its inability to offload grains derives from the systemic failure of the Public Distribution System (PDS), as well as the lack of political will to ease inflationary pressures and hunger.

The failure arises at every step of the government machinery and is now obvious to everybody except the food ministry.

This JNU don then concludes his article as follows:

The solution is not to create more storage capacity and, therefore, build up stocks. The solution lies in making sure that grains reach those who deserve it. Hopefully, the food security Act being debated by the National Advisory Council will look at the delivery mechanism with some seriousness.

Having examined the convoluted workings of a JNU don's brain, let us now look at the same issue from a different ideological perspective - that of classical liberalism, which sees The Market as the primary social institution by which people obtain their need-satisfactions. Those who see the world in these terms do not believe that The State has any role in creating "delivery mechanisms" by which scarce economic goods reach the populace. Lots and lots of stuff reach our kitchens - cereals, pulses, spices, vegetables, fruit, eggs, meat, fish, tea, coffee, oil, sugar etc. In almost all these instances, it is The Market that delivers these goods - and we pay market prices for them. There are hordes of private businessmen involved - wholesalers, retailers, warehouse keepers, transporters and so on. And wherever these matters are handled by such private businessmen, we NEVER hear of stocks rotting or being eaten by rats. This is because of the "profit motive" - such wastage of stocks would cause huge losses to the private businessman, and private businessmen therefore have a powerful incentive to carefully superintend the storage of the goods they buy and sell. Private businessmen seek to "accumulate capital." Private businessmen never engage in "capital consumption."

Our JNU don says:

Needless to say, procurement is not in itself a problem. The problem is that the government is clueless as to what should be done once foodgrains have been procured.

Actually, it is procurement that is the real problem. This is where our taxes are going. We as a people can either pay taxes for food - or we can pay market prices. In choosing between these two ways of obtaining food, we must decide which is the more "efficient" - that is, which delivers the results at lower costs. Obviously, as we experience every day when we go to The Market to obtain all our needs, private businessmen are much more "efficient" than our The State can ever hope to be. If we relied on The Market for food and everything else, the taxes we pay can be used for better things. In the case of "procurement and distribution of foodgrain" by our The State, what is really happening is "capital consumption." The rats are eating our collective Capital. And the bureaucRATS are rats too.

The Science of Economics concerns itself mainly with questions of "means and ends." If the "end" in question is how our kitchens will be supplied, then the correct answer as to the "means" is The Market. Today, our society is opting for State provision, paying taxes instead of market prices, guided by socialist ideas; but if all the accounts of The State are carefully audited, it will be found that the real cost of the cheap rice or wheat at a PDS store is infinitely higher than "what is seen."

In my view, therefore, Indyeah must abandon The State and turn to The Market for all its needs, including food, housing, clothing, whatever: the roti, kapda, makaan everyone requires. Further, international trade should be free, so that imports can augment local supplies.

The dysfunctional socialist State, and its bloated bureaucracy should be severely cut down in size, and made to perform prescribed duties essential to the maintenance of the market order. Further, the Public Revenue obtained from taxes, our collective Capital, should be invested in Capital goods - like roads - and not "consumed" in this thoughtless fashion, by all kinds of rats.

If at all there is a role for the State in the distribution of food, then this comes into play only in cases of severe famine. But this is a temporary role in an emergency, and not a permanent "food ministry" employing millions, spending billions, with nothing to show for it.

Therefore, I believe that:

1. The Ministry of Food should be closed down.

2. The Food Corporation of India should be closed down.

3. The Public Distribution System should be closed down.

4. And, most importantly, JNU should be closed down as well.

Drop Out And Self-Study

Yesterday, I received a shocking letter from Hema Narang, a young student in Delhi, describing the horrors of her first day in Jawaharlal Nehru University. Here is the full text of that letter:

Dear Sauvik,

I am a regular reader of your blog 'Antidote'. I have also attended one of your sessions on Free Trade in the Liberty and Society Seminar organised by Prabodh. I have just completed my graduation in Political Science and cleared my entrance for masters in International Relations from Jawaharlal Nehru University (JNU). I wanted to share with you my first day at JNU.

Last week, I attended the first lecture in which the professor was teaching us about the Indian Constitution. Endless times he repeated that 'Right to property is an anti-poor right... it should be completely scrapped from the Constitution... which should have rights like right to work and leisure. The Constitution is a classist document...' Apart from this, his favourite issue was: Reservations, and why the creamy layer should NOT be debarred from them, and how there should be more sub quotas within quotas. This was not all! He gave a completely lame (actually very stupid!) argument against globalisation. He said that all the corruption that is happening in the Commonwealth Games is because they can import machinery from outside! (Intellectual Bankruptcy!) All over the JNU campus one only sees posters against capitalism, SEZs, MNCs and whatnot.

It is really difficult to study at such a place (I can't understand why it's the best course and JNU one of the top universities!). It's not an 'educational institution'. It's a place where young people are actually being 'indoctrinated'! It's extremely sad because young minds are like blank slates and JNU is showing them only one side of the picture (which is not fair!). It's totally unjustified. I have not taken admission to learn about leftist ideology! It is my personal choice to study the author I like, but as an educational institution JNU should be acquainting me with all the perspectives to an issue. Taking admission was in itself a big hassle. I had to fill up 10-12 forms writing the same information (the forms had to go to different departments). I'ts a highly bureaucratic structure and one is totally at the mercy of the babus! What's more saddening is that you don't have an alternative...there are hardly any good universities in the country.

In Liberty,

Hema

So, I hope all you bright young people who are reading this get the full import of what I have been saying all along - that Chacha Manmohan S Gandhi is an "intellectual bodyguard of the House of Nehru"; and that all the fuss he is making about "education" is nothing but an evil plan to destroy your intellect. In my reply to Hema, I said:

Why don't you drop out and save your intellect, your time, and your money?

To "drop out" of State-sponsored education does not mean an end to learning. Most certainly not. All it means is that you yourself take full responsibility for what you feed your mind. You no longer depend on nor trust The State and its "bureaucrat-professors" to teach you. You search for knowledge on your own. You study it yourself. You educate yourself. I have tendered this advice to many, many students over the years. Those who have followed it have all benefited.

My position on this vital subject of education is fully consistent with classical liberalism of old. In my The Essential Frederic Bastiat (free download here), the last essay is actually a "manifesto" that Bastiat wrote when seeking to get elected to Parliament. This manifesto is a newly discovered resource, and does the volume proud. In his manifesto, on the subject of education, this is what Bastiat says:

If you want to have theories, systems, methods, principles, textbooks and teachers forced on you by the government, that is up to you; but do not expect me to sign, in your name, such a shameful abdication of your rights.

This has been my consistent position all along: that The State has no role in education.

I also do not think that the solution to this problem lies in pursuing expensive courses in foreign universities. Anyway, most Indian students cannot afford this. Rather, the real solution is to make full use of the Internet. Today, because of the Internet, a huge amount of literature on classical liberalism and modern libertarianism is available free online, as, for example, at the Mises Institute website. If they drop out of the "official" education system, then students will have lots of time to pursue worthwhile studies, much of it that is not taught even in the great "Ivy League" colleges of the USSA.

Remember, to be a worthwhile "citizen," you must be armed with the knowledge necessary to challenge State authority. State-sponsored education can never get you there. It will only make you a dumb commoner, who believes all the lies the State spouts.

Anyway, I am glad to report that Hema is planning to drop out of JNU.

I have saved one soul.

To conclude: Sir Arthur Conan Doyle's stories of Sherlock Holmes, set in Victorian England, are especially instructive in one respect: Holmes is a "Mr."; his sidekick Watson is a "Dr."; and his biggest enemy, the evil genius Moriarty, is a "Professor." Yes, professors can be evil - and many are. So beware.

I once wrote a great piece referring to Chacha Manmohan as Professor Moriarty. You can read that article here.

Chacha Speaks - A Whole Lotta Bull!

Chacha Manmohan S Gandhi's address to the nation on the occasion of the 64th anniversary of Independence Day, the day on which our ancestors threw out the British Raj and installed the CONgress, is available here.

At the outset, let us note that Chacha does not speak to the public much. Just the other day, he held a press conference at which not much was said, except that it was his first press conference in four years. Quiet, backdoor man, our Chacha.

Predictably, Chacha began by invoking the spirit of Jawaharlal Nehru, the Great Socialist, whose grandson's widow now commands the CONgress - and Chacha as well. He said:

When Pandit Jawaharlal Nehru unfurled the Tricolour on this historic Red Fort, on 15th August, 1947, he called himself the first servant of India. I address you today in the same spirit of service.

Yes, it is true that our Chacha has spent his entire life in "public service": he has been Chairman of the University Grants Commission, Governor of the Reserve Bank, Deputy Chairman of the Planning Commission, Finance Minister, and now he has reached the very top of the greasy pole and become PM. A lifetime of selfless "service," he assures us.

Let us now jump to the penultimate para of his speech, where this "first servant of India" talks about the forthcoming Commonwealth Games. An obscene amount of public money has been spent on hosting these games, and we all know that much of this money has been stolen by the "servants of India" Chacha employed for the purpose. Chacha says:

The Commonwealth Games will start in Delhi after about one and a half months. This will be a proud moment for the whole country and especially for Delhi. I am convinced that all our countrymen will treat the Games as a national festival and will leave no stone unturned to make them a success. The successful organization of Commonwealth Games would be another signal to the world that India is rapidly marching ahead with confidence.

Actually, to most observers, these games are our "common loss." It is clear that Chacha is talking rubbish. He expects us to believe this rubbish - simply because HE said it. He thinks we are all schoolchildren, or illiterates, or JNU grads. He thinks we are a nation of fools - because he knows that the CONgress has been fooling us all these past 64 years with this "first servant of India" bullshit. He wants to continue on this path.

It is poor form to end a political speech on such an important occasion with a bald lie. The politician who does this loses his audience entirely. But Chacha is no politician - and we all know that. He calls himself an "economist" - so let us now examine what he said on an economic issue of great importance: inflation. He said:

I know that in the last few months high inflation has caused you difficulties. It is the poor who are the worst affected by rising prices, especially when the prices of commodities of every day use like foodgrains, pulses, vegetables increase. It is for this reason that we have endeavored to minimize the burden of increased prices on the poor. Today, I do not want to go into the detailed reasons for high inflation. But, I would certainly like to say that we are making every possible effort to tackle this problem. I am also confident that we will succeed in these efforts.

More bull.

Inflation is a "policy" used by government to fund itself. Chacha is an "inflationist." All Keynesians are. But he doesn't want to "go into the detailed reasons for high inflation." He wants to keep the people in the dark - to go on fooling them forever. First servant of India, indeed.

If you want to know the real causes of inflation, I recommend an article I once wrote called "Funny Money." You can obtain it here.

The rest of the speech babbles on and on about a host of issues - and it all sounds like the same old bull we have been hearing for so long. What I found particularly odd is that, just after boasting that ours is one of the fastest growing economies of the world today, Chacha thanks those who made this possible - but misses out on our businessmen and entrepreneurs. He says:

All of you have contributed to India's success. The hard work of our workers, our artisans, our farmers has brought our country to where it stands today. I specially salute our soldiers whose bravery ensures the safety of our borders. I pay tribute to all those martyrs who have sacrificed their lives for our country.

This is the Jai Jawan, Jai Kisan nonsense. Of course, this servant of the Nehru dynasty cannot bring himself to say "Jai Vyapari."


To conclude: Lewis Carrol's story of Humpty Dumpty is a satire on a British prime minister of that era - or so I believe. Chacha is our Humpty Dumpty. He "sat on the wall" between Liberalism and Socialism for a long, long time - but finally fell on the wrong side. When he ascended to the top post, everyone welcomed him as a "liberalizer." But he turned out to be nothing of the sort. He remained a Statist - only, in his case, a Welfare Statist. And an inflationist to boot. He has only championed increases in the Role of the State - (mis)education, right to work, right to food etc. For these, he has levied new taxes. He has also borrowed excessively. And inflated the currency too. All these measures cause "capital consumption." Thus, they retard progress. They reduce prosperity. They cause de-civilization. They harm us all - especially the poor, in whose name all these first servants of India profess to work. Never has Chacha spoken in favour of The Market. His trade minister, Kamal D Nutt, single-handedly wrecked the WTO. Chacha hates the idea of free international trade. Even today, foreign capital is debarred entry into many areas where it could do great good - like retailing, on which I have a recent post, here.

So there you have it. The "world's largest democracy" - and a prime minister who has never won a Lok Sabha election, deliberately trying to fool the people, pulling the wool over their eyes.

But I do believe that our own Humpty Dumpty has suffered a fatal fall. This bogus speech proves it.

We Must Fight Again For Freedom

Tomorrow is Independence Day - and Chacha Manmohan S Gandhi will address us from the ramparts of Red Fort, where the Grand Mughals lived, in his thin, warbled voice. All over India, the tricolour will be ceremoniously hoisted - and this is basically the CONgress flag. Marching bands will play the national anthem that glorifies "The Leader." Of course, it will only be The State that will celebrate. I doubt whether The People have anything to cheer about.

If you switch on your television to watch Chacha's speech on the occasion, do note that he is an extremely old man. Even his eyebrows and eyelashes are white. He was born in a village that is now in Pakistan. He has living memories of 15th August, 1947, for sure. His spirit must have been deeply stirred by Jawaharlal Nehru's "tryst with destiny" speech that fateful day.

And that, indeed, is the problem within India - it is the generation to which Chacha belongs that claims to have "fought for freedom." Yet, none of them knew anything about freedom. It is they who hero-worshipped Nehru and Gandhi, who opted for "socialism," who instituted "central economic planning" - it is they who really destroyed all our freedoms. Their false god is The State. No wonder, then, that 15th August, 1947, was but a false dawn.

Today, 63 years later, the vast majority of Indians are young. It is for these youngsters that I write, so that they understand what freedom really means. The future belongs to them. If CONgress totalitarianism is to be defeated, then it is the youth of India today that will do it. Freedom is not something we enjoy because our ancestors fought for it. It is something that each generation must fight for again and again. "Eternal vigilance is the price of Liberty," as some wise man once said.

What is freedom? Well, quite obviously it is a condition you enjoy only when The State does NOT interfere with your personal plans. Every action of The State is nothing but a negation of freedom. Even if The State decides to educate the unlettered, and we foolishly agree, a tax will be levied for the purpose, and all taxation, being a violation of Property, is a negation of freedom.

In other words, there is nothing "positive" that The State can ever do to promote your freedom. You are free only when The State is severely restricted in size and scope. Always keep that in mind. It is this "political science" that the generation to which Chacha Manmohan S Gandhi belongs were unaware of. They mistook freedom for The State. They mistook The State for "society." They fucked up real bad. Exactly how bad we now know - for the entire sub-continent is a mess. If the youth of today are to set things right, their first civic duty is to "study" the Philosophy of Freedom. They must know what it is before they begin to battle for it.

I am not at all pessimistic about the future. I have full faith and confidence in the youth of today. They are a generation that has never really known the hard "socialism" of the 60s and 70s, the years during which I was growing up, when nothing much was available in our markets and The Economy was completely moribund. This generation has grown up with The Market. They wear Levi's jeans, drive fancy cars and bikes, drink Scotch whisky, carry imported mobile phones and are totally Internet-savvy. They sneer at "socialism" - the PSUs, the planners, et. al. They despise our politicians. Their dreams are of Capitalism - and these are dreams they dream in technicolour. Well, someday soon, they will realize that dreams are not enough - and that our reality is obscene. That day, they will begin to fight for real freedom. May that day come soon.

The bestselling novelist, Chetan Bhagat, is a representative of this generation. Today, the ToI has published a thoughtful column by him, a spoof on what Chacha might say tomorrow, from the ramparts of Red Fort. I loved the last lines - about freedom. Do read it. It speaks volumes about the intellectual disconnect between Chacha and our youth. And it leaves me with hope.

I am confident that this new generation will fight for their own future.

I am confident that India will soon see a New Freedom Struggle.

When YOUR God Fails

India is not just a constitutional "socialist democracy"; she is also a "constitutional bureaucracy." There is an article in the Constitution of India that establishes the All India Services. The IAS, IPS and the Forest Service are all creatures of this socialist democratic constitution. And if the country is a god-almighty mess, surely the bureaucracy must take some responsibility for this failure. In the original scheme of things, it was only to be expected that democracy would bring into office the representatives of illiterates. Knowledge-based policy advice was supposed to come from the officers of these services. But what is their "knowledge"?

The training academies of the bureaucracy teach State-Worship. These people worship centralized power, socialism, central planning and all the rest of the rubbish. It is no wonder that more than 20 years since the Berlin Wall was torn down and East Germany (also a "democratic republic") disappeared from the map, as did the Soviet Union, our fellas still cling on desperately to the "socialist" tag. Their last hope lay in Chacha Manmohan S Gandhi - but today, to most people, it seems quite apparent that Chacha has failed. All his ideas, from NREGA ditch-digging to "right to miseducation" to "right to food" are seen by most sensible people as bogus. To the trained economist, they are but means of "capital consumption" - which is the pathway to "de-civilization." The pathetic condition of all our cities and towns - and New Delhi is a "failed city" in my honest opinion - shows clearly that our civilization has been destroyed. The root cause: socialist democracy, an ideology that involves State Worship. It is their "Mortall God" - as Thomas Hobbes calls the State in Leviathan - that has failed.

Classical liberals like Adam Smith and Frederic Bastiat NEVER worshipped State power. Indeed, they considered it dangerous and raised the call for Liberty. That is, Liberty from the State. Adam Smith was a staunch Whig and the Whigs wanted to restrict the powers of the State. They wanted "commercial liberty." They wanted freedom in religious matters. If there was any "god" in their minds, then this god was in The Market. Adam Smith's "invisible hand" was but the hand of God. And as for Bastiat, the devout Catholic - he saw God's hand in the "natural order" of trade, commerce, and peaceful exchange. Bastiat, in his brief essay titled "The State," defines this beast as "that grand fiction by which everyone tries to live at the expense of everyone else." No State-Worship here. No worship of Power.

Yet, it is all this "power" that has failed India. We in India do not see "anarchy." On the contrary, we are an "over-governed" nation. It is a sorry fact that all this over-government has established nothing but corruption and chaos. In all this chaos, all that works for the real benefit of the people is The Market. And our bureaucRATS hate this social institution. This is because of their faulty training and indoctrination - which is socialist and statist. This is the prime cause of the "knowledge failure" we see all around us.

Today, 21 years since the Soviet Union imploded, the Supreme Court of India has stepped in to protect the socialists. Yet, the news from New Delhi these days is only about the failures of socialist democracy and bureaucracy. It rained in Delhi - and all the streets were water-logged. For weeks now, there is news every day on corruption in the administration of the Commonwealth Games. To top it all, it seems that the principal "political parties" of this democratic tamasha - the Congress, the BJP and the Communists - are all in disarray. The great God of socialist democracy seems to have also failed. Note that these are the political parties who swear by the Constitution. It is a Constitution that protects them, not us. It is a Constitution that empowers them, not us. And what are the intellectual and moral qualities of the personnel of these political parties, or even their great "leaders"? The less said, the better, I think.

Where do we go now? my reader might ask. I offer the story of one of my travels in Germany. I visited the quaint and extremely pretty ancient town of Esslingen once, just outside modern Stuttgart. It is such a beautiful town that the Allies deliberately refrained from bombing it. In the middle of the town square stood the grand old building of the city Mayor. This, to me, was the political institution of the market economy. This is "civil government."

From Esslingen, I was taken directly to a castle some hours away where the Hohenzollern rulers used to live. The castle had been built high up on a mountain, and it looked quite forbidding, even from afar. When I toured the castle, I saw that it was elaborately fortified, with cannons all around. Inside, in the museum, most of the artifacts on display were memorabilia from various battles that these rulers fought. This, to me, was The State - an institution devoted to war, to inflicting pain, to imposing taxes, and to other predatory schemes like monetary inflation. And the Germans know a lot about monetary inflation.

Citizens of Indyeah - think!

Constitutional socialist democracy and constitutional bureaucracy have both failed this nation. We must therefore think of an alternative future - and I hope this blog gives you much to think about.

On Privacy, Secrecy, Security, And "Intelligence"

There has been some disturbing news of late: first, about some trouble between our "security agencies" and the makers of BlackBerry; and second, which is much worse, that the long-awaited 3G services might be delayed until the State Police has its "tapping infrastructure" in place.

Quite frankly, if the State Police ever wanted to see us Indians "secure," they would do something about road traffic safety. More than 1,20,000 people are killed on our roads every year, and many, many more seriously injured. But they have other things on their minds - like "terrorists" and "insurgents." In the meantime, Maoists and Naxals are on the upsurge; Kashmir has spun out of control; and from Gujarat there is crystal clear evidence of the State Police being a bunch of no-good "outlaws."

If we in India desire to become a free market society then it must be emphasized that businesses are based on a great deal of confidentiality. It could be fatal for any business if the competition got hold of its secrets. Thus, "privacy" is all-important for businessmen in a free market society.

Let us now turn our attention to The State - and by this I mean a "government" in a free market society. For one, this kind of government is very different from a Socialist State. The Socialist State imagines itself to be "society." It occupies the "commanding heights"; it "plans" for all; it is omnipotent and omniscient. A classical liberal government in a free market society is not conceived in such totalitarian terms. Such a government is NOT society. Rather, it is just a small "organization" within a vast free society with specific tasks, specific funds, and limited powers. Thus, socialists and classical liberals (like Mises) look upon concepts like State and Society very differently. And these differences in approach are crucial.

Therefore, while in a free market society businessmen must be able to maintain secrecy, it is vital that the small government they have created for the preservation of The Market does not have secrets of its own. Indeed, such a government must be totally transparent. All that it does must be in the open. Today, at least in India, things are the other way around, with The State shrouded in secrecy; and the same State using force to pry into the affairs of all and sundry.

My policy preferences are therefore in favour of complete and total government transparency. And simultaneously, for complete security for every private Individual from intrusion into his private affairs, including especially his business affairs, by agencies of the government.

To conclude: The dysfunctional socialist, centralized State sitting far away in New Delhi is NOT what the "rule of law" is all about. The principle of rule of law, or constitutional government, is that the personnel of this government are UNDER the law, and are forced to follow it. If private people cannot steal and murder, then neither can the personnel of the State. The dysfunctional socialist, centralized State consists of many "intelligence agencies" like IB and R&AW who are totally "above the law." They do as they please. They are a law unto themselves. Even their budgets are kept secret from Parliament. If these agencies are vested with powers and technological capabilities to spy on every citizen, then that would be one more step towards totalitarianism, to the "Big Brother is watching you" scenario. Horrors.

So, be warned, and take all steps necessary to preserve yourself from these spies of The State. Protest against all this nonsense. And demand top class "security" on the roads. Point out that in the entire megapolis of New Delhi there is not a single zebra crossing that works to keep the pedestrian secure. Get these tax parasites to do something called "useful work." The evil scheme they are contemplating is nothing of the sort. It is dirty spying, pure and simple. Spying on free citizens. This should be strongly opposed.

Why Not Import Used Cars?

The question that stirred Adam Smith's mind in the backward Scotland of the 1750s was this: What constitutes the "wealth of a nation"?

If you get your mind destroyed by your "Indian Economics" textbook, you will think that the wealth of India consists of Nehru's steel plants.

Adam Smith, way back then, said that the wealth of a nation consists of the Properties of all the Individuals who constitute that nation. He therefore called for free trade and the "system of natural liberty."

Think about it:

If we make an inventory of all the possessions of all Indian today, and if we declare unilateral free trade tomorrow, and then we total up their possessions again a year later, will these show a marked fall or a marked rise?

So, when we look at the bizarre traffic on our city streets and hopeless highways, let us never forget that this is an "artificial order," created by the force of The State - customs men use guns - and not the "natural order" of a FREE MARKET, which always works in the "consumer interest" and never the "producer interest."

The answer to the traffic mayhem is used car imports. Kathmandu, when I first went there in 1980, had used Japanese cars as taxis - and they were a much better ride than our Ambassadors. Kathmandu also has a tramway.

And there was "Freak Street"!

Yes. Indians are poor. They lack Capital. But then the solution to individual transport taken by The State makes NO SENSE whatsoever, for they say:

Let us force all poor Indians to buy brand new cars made in India.

Today, there are many MNCs receiving "protection," and they are now producing behind tariff walls themselves. Nonsense!

The profusion of two-wheelers is also because of this "artificial order." Socialist and autarkic nations always made guinea pigs out of their people in the area of personal transportation. Just as the Chinese of old only had bicycles, our people now own motorcycles and scooters "made in India." Just as the Chinese of old had a huge bicycle industry, we have a big motorcycle and scooter industry.

But the question is NOT how to build modern factories in India - like Nehru's steel plants. The real question is how to increase the Properties and the consumption of all poor Indians.

Modern technology is specialized "knowledge" developed abroad but easily made available to all unlettered Indians through free trade - like the mobile phones that anyone and everyone possesses today. Same with cars. Same with trams. Same with airliners. Foreign trade is meant for IMPORTING, not exporting. We then obtain what we cannot produce ourselves, things we value much more than local produce. Modern technological knowledge is best obtained by free trade - not setting up IITs behind tariff walls. All the IITs cannot produce a car, or a mobile phone. As yet.

There was a comment to yesterday's post on "auto-rickshaw economics" that spoke of Thailand and her tuk-tuks and strange boats. And I was reminded that the boats we use in India today suck real bad. Here again, we need imports. I think our trucks and buses suck too. We need a revolution in transportation technology - and we must import.

Recommended read: My Four Wheels For All, available here, and used car imports are discussed in depth there.