Abolish All State-Owned Enterprise - By Constitutional Law

A good definition of a State-owned enterprise (SOE) is:

A firm with an unlimited capacity to make losses.

We discussed Air India the other day, in which I quoted the following from a news report:

The airline, which is burdened by an accumulated loss of Rs 20,320 crore, has outstanding loans and dues of Rs 67,520 crore -- of which Rs 21,200 crore is working capital loan, Rs 22,000 crore is the long-term loan on fleet acquisition and Rs 4,600 crore vendor dues, latest official figures showed.

Today, the bad news is about BSNL - the State-owned telecom firm - which has now accumulated losses of over 6000 crore rupees (1 crore = 10 million). Its revenues have declined - and its biggest cost is salaries for its 2,77,000-strong workforce. BSNL is opting for a voluntary retirement scheme that will cost the company Rs. 2,700 crore while the Department of Telecom (which means us) will have to shell out Rs. 18,000 crore. 


Overstaffing - the bane of the public sector: "Jobs for the Boys."


What I would like to add today on discussions against SOEs is the fact that they are "unfair competition." If a private telecom firm had made such losses as BSNL, and if its employees numbered so much, it would have folded up long ago. Ditto for Air India. New, private owners would have taken over both these firms. But with SOEs, this never happens. And these loss-makers continue to "compete" with efficient private firms, taking business away from them. Note that the news report above on BSNL says:

BSNL, which offers telecom services in all areas of the country, barring Delhi and Mumbai, had 95.14 million mobile subscribers as of July 31. It is making efforts to catch up with its private counterparts.

That is 95.14 million subscribers "unfairly" taken away from private firms. If BSNSL and Air India had been allowed to fold up, their employees would have found jobs with profit-making private firms - and contributed to national wealth.


Why should there be SOEs at all?


In the old days, like when I was in college studying Economics, we were told that Chacha Nehru set up these State-owned firms because, among other reasons, "private capital was not forthcoming." That is clearly not the case today. In telecom as well as civil aviation, in steel, in hotels, in fertilisers - in everything - private capital is doing wonders. And this is particularly true of telecom and civil aviation, two sectors where SOEs are failing dismally, showing clearly that they "work" only where competition is outlawed - like railways and electricity. This itself shows the inherent inefficiency of SOEs. Ministers and baboons are unfit to run enterprises - and they most certainly should not be allowed to do so with money pulled out from the public treasury.


So, when we have a New Constitution, when we have our Second Republic, let us include a clause that debars The State from funding any SOE.

India - As A "Nation Of Shopkeepers"

Continuing from where I left off yesterday, let us note that expanding commercial space is "economically sustainable" in the precise sense that this will not require any welfarism; no freebies will have to be doled out to "the poor." Rather, it will enable millions to earn their own living - and further, these self-supporting people will pay taxes instead of huftha. This is precisely what happened in Singapore.


When Singapore gained independence in 1964 (shortly after Nehru's death) the city-state was poor. The area now known as the Central Business District (CBD) was a place where over 200,000 street hawkers and vendors plied their trade. Lee Kwan Yew then readied a "design" for the place by which the CBD would be hawker-free - but he also designed residential areas on the fringes of his territory, and built special markets for re-locating the CBD hawkers there. Today, these very hawkers are tax-paying middle class citizens. 


In Singapore, furthermore, street food is big business - and a great tourist attraction. There is really nothing much in Singapore worthy of tourism; but they have created their city in such a way - shopping, food and drink, Sentosa Island, underwater park and the zoo - that millions of tourists, including lots of Indian tourists, flock there year after year.


In other words, all this is eminently feasible. It just needs sensible city management. This needs mayors with budgets and authority. It needs Subsidiarity - so that mayors can keep local taxes, and are more important than the Central State or the Federal State. We in India need to re-build all our existing cities and towns, and also create many, many more.


I may add that I am no great fan of Singapore's "authoritarian capitalism" - to borrow Cristopher Lingle's phrase. But Lee Kwan Yew has built Singapore into what it is today, while our rulers have destroyed each and every city and town - without exception.


Welfarism is "economically unsustainable." All welfare is about "consumption" - not "investment." In the final analysis, we in India need Capital investments - and roads are Social Capital. Roads are also "collective property" in the sense that everyone can use them. (I am not referring to highways, which can be private, from which those who do not pay the toll, or who use inefficient vehicles like bullock-carts, can be kept out.) 


Thus, roads are the collective property we need - not Air India, SAIL and ONGC. If we privatised the entire public sector, there would be enough money to invest in world class roads. These roads would lead to a re-building of our urban areas, especially all the satellite towns. They would be much more commercial space for all, including all those who are hawkers today. In time, I am confident, all traders would own proper shops.


I have myself seen this happening in a posh South Delhi market. When the market was built in the 70s (Delhi is a "new city"!) there was a chap there who sold salt peanuts from a pushcart. His peanuts were good, his customers liked what he sold, and today he owns a little shop in that very same market.


Of course, New Delhi is a very bad "model." This "planned, new city" has almost no commercial space. There are lots and lots of "parks" - but there are very few markets. The Mughals built Chandni Chowk, the Brits built Connaught Place, but these jerks only built Nehru Place - a disaster. In Delhi, zoning rules are flouted openly - there is no other way - and huftha rules.


These socialist jerks only thought about "housing." They never thought of The City as a commercial hub. Thus, they never built any commercial spaces - like markets. Hence the disaster.


Today, they are talking "welfare." That is NOT what we need. We need cities and towns - and markets. We also need housing - and there is enough space for that. But people will buy houses only after they have earned enough through market activities.


So why just Bengal? The whole of India can be a Nation of Shopkeepers. 


"Into that haven of freedom, my Lord, let my country awake."


Amen.

Money, Taxes, Prices - And A Parade

The governor of our central bank, the RBI, has assured the Sheeple that he "will do everything to bring inflation under control." The strategy he will adopt: "restrain demand pressures." As though inflation is demand-driven. Oh! We poor sheeple.




Similar sounds are also emerging from Ben Bernanke, chairman of the US Federal Reserve, the chaps who print US dollars:

In his first press conference as chairman of the Federal Reserve, Ben Bernanke discussed rising gasoline prices, blaming higher demand from emerging economies and Mideast oil-supply disruptions as the cause of the zooming prices. Bernanke did not mention the US government's role in the higher energy prices, and he explicitly absolved the Federal Reserve of any blame.

As Mark Brandly points out in this article (in which the above quote is the opening paragraph) on why the US Fed ought to be shut down:

Bernanke's deceitfulness is appalling, although not unexpected. He knows that Federal Reserve monetary policy plays a significant role in gasoline prices. Expansionary monetary policy leads to more dollars being available in world currency markets and weakens the dollar. The weaker dollar results in higher import prices. More than half of the oil consumed in the United States comes from foreign producers....

The word "deceitfulness" is noteworthy. It must be applied to our RBI governor, too. Inflation is a deliberate policy used to finance State expenditure - a very deceitful policy. More dollars or more rupees - the result is the same: the value of the paper note declines. Gold has crossed 23,000 rupees for 10 grams - only because the value of the rupee has fallen. Similarly, in the US, when Nixon de-linked the US dollar from gold, the yellow metal was priced at $35 an ounce. It is more than $1500 an ounce now.

Inflation is nothing but a purely monetary phenomenon - caused by an excess supply of money resulting in the fall of the purchasing power of the monetary unit. To end inflation we must end central banking. Money must be "private money." The country must be put on the gold standard.

In other words, The State must be denied the power to fund its programmes through the deceitful means of printing paper notes to pay for them.

No more MGNREGA, no "right to food" and no "right to free and compulsory education" - that is, no more welfarism to buy votes - and inflation will be ended for ever.

Remember - inflationism robs the poor of their Capital - thereby rendering them poor for ever. Welfarism never benefits the poor in the long run - see the poor in the welfare states of Europe that are now going belly up. Welfarism paid for by inflationism is NONSENSE! It is precisely the "false philathropy" combined with "legal plunder" that Frederic Bastiat warned us about in The Law. This is not socialism; this is anti-social. So much Capital Consumption will destroy our civilisation.

**********************

But we also pay taxes! Should we continue to do so?

I was discussing taxes with a local entrepreneur here - pointing out that all we get in exchange for them is the State Danda: all manner of "inspectors" land up to collect bribes, which are an "illegal tax." We pay taxes in exchange of these bribe-taking inspectors. This is all that is "real" about our The State.

These are not just from the State Police, but also come from the labour department, the health department, the CRZ administrators, the excise department and so on and so forth.

This danda (Hindi word for "stick") is REAL. This is ALL we get for our taxes. We certainly don't get good roads, footpaths, clean cities and towns, scientific traffic management and suchlike. Over 200,000 of us are killed on our unsafe and horrible roads every year - more than get killed in a small war. Why should we pay taxes - that is, after money has been privatised and The State can no longer print paper notes to fund itself?

Think about it!

If we do not pay any taxes to The State - if business is laissez faire, if we inhabit a "private law society," and if everything is privatised, all we would have to pay for whatever we need are PRICES: for electricity, for water, for expressway tolls... The local entrepreneur here affirmed that he would be happier paying prices than taxes. "Starve The State," he cried out loudly.

Yes, in exchange for prices, businessmen will supply us with "goods." All that we get in exchange for our taxes are "bads." The Danda!

***********************

I HATE the danda of our The State - a State that does nothing right. A State that leeches on the people. A Predatory State.

As you all know, one danda I really hate is the Narcotics Act. It denies me good ganja. That drives me even madder. Especially in the morning. Like right now.

I therefore propose a Great Ganja Pride Parade in Goa. Let all smokers of the Holy Herb assemble, smoke and shout slogans for Liberty. And march. Let us show them our numbers. Let us show them our Anger. Let us show them our Pride - and our determination to be free from Tyranny.  

Only A Constitution of Liberty Can Save India

The Anna Hazare-led "movement" to battle corruption is fading out - as I had predicted - and, in the meanwhile, here is a fresh report of massive corruption from today's news, pertaining to Air India's purchase of airplanes. This time, an entire "Group of Ministers" are involved, including Praful Patel (civil aviation minister) and P. Chidambaram (police minister).

What is the solution? Anna Hazare's Jan Lokpal (ombudsman)? Or a New Constitution that severely restricts this overweening Socialist State - and delivers freedom from State interference to the citizenry? 

I would insist on the latter: that only a Constitution of Liberty can save India. Thus, if the New Constitution debars the State from running businesses of its own, and all PSUs are privatised, a whole lot of political and administrative corruption will be ended for ever. Similarly, if the New Constitution guarantees Economic Freedom to us all, and this State is dethroned from the "commanding heights of the economy." Ditto if Private Property is made inviolable by the State. If Liberty prevails, then only will corruption cease.

So we do not need to draft a Lokpal Bill. We need to draft a New Constitution - which should be short and crisp. This should guarantee Liberty, Property and the Pursuit of Happiness to us all. Power - that too, very limited power - should be decentralised to the level of city and town: subsidiarity. The Centre must fold. Powers to tax should be strictly limited. Powers to inflate should be taken away - by mandating Private Money: gold. Powers to engage in "social justice" should also be done away with - no more MGNREGA, which funnels loose money to the officialdom. Instead of "fundamental duties for the citizen" there should be fundamental duties for the personnel of the State. Freedom to trade by land and sea should be guaranteed - and customs duties disallowed by law. Also, most importantly, the State should have no role in education.

Anna Hazare seems to be quite a monster, actually. According to Amit Verma:

He [Anna Hazare] runs a village in rural Maharashtra as if it is his personal fiefdom, like an authoritarian feudal lord. He is a fan of Shivaji, and admires him for once chopping off the hands of a man who committed a crime. In that vein, he passes an order that anyone found drinking alcohol will be tied to a pole in front of the village temple and publicly flogged. Several men undergo this, one of whom, a vice sarpanch of the village, says: “I was drinking. I was ... tied to the pole and flogged two-three times. It is normal. [He] will try to make you understand once or twice and thereafter, he will beat you badly.” He believes in “rigid implementation” of family planning, including forced vasectomies.

Doesn't sound much like a "freedom man," does he? More like a tin-pot dictator, if you ask me.

It is an old adage that power corrupts. Our present Constitution gives the State huge powers - while giving no guarantees of either Liberty or Property to the citizenry. Nandigram, Singur, Meerut, Jaitapur - these are all because of excesses of State power, because they have the power to take our Property away. Surely, ours cannot be called a "constitution of liberty."

A wise man once said:

The original idea behind constitutions is that of limiting government and of requiring those who govern to conform to laws and rules.

 So I shall stick to my earlier suggestion: We need to "seize Liberty and end Tyranny" through a New Magna Carta of our own.

Nothing less will do.

Votes For Sale or Goods For Sale?

Julian Assange has done India the favour of exposing the fact that MPs traded their votes in Parliament for cash from the CONgress.

How is that different from voters in Tamil Nadu trading their votes for freebies from Karunanidhi or Jayalalitha, or both?

There was a scandal many years ago when a BJP guy in Lucknow distributed sarees free on behalf of Atal Behari Vajpayee - and many women died in the stampede that followed.

All this is not new to Public Choice Theory, where "vote trading" has been carefully studied for decades. Do study Gordon Tullock's The Vote Motive. It will introduce you to the idea of "State Failure." That is, even in "liberal democratic" states. This is the very opposite of "market failure" - which Economics textbooks teach these days.

Markets do not fail. Freedom cannot fail. I will never forget the first time I was taken to Main Street  in Poona - the central market area from British times - and my guide waved her arm about and said, "You get everything here."

Yeah, Everything.

We get nothing from our The State - except Persecution. If every State Monopoly was privatised, including forests, our lives would be much, much better. We would have electricity 24 x 7. We would be possessed of toll highways and truckways of international quality. Our railways would be first class. And there would be trams in every small town. There would be lots of different meats to eat - like wild boar. And timber would be plentiful and cheap. This includes sandalwood. Poor Veerappan - murdered by our The State without a public trial.

So, screw The State.

And love The Market.

And remember these words of Ludwig von Mises, always:

It is precisely the necessity of making profits and avoiding losses that gives to the consumers a firm hold over the entrepreneurs and forces them to comply with the wishes of the people.

Better to have The Market - where mass production for mass consumption means We The People control entrepreneurs.

The "rupee vote" in The Market works - for our benefit.

And screw Democracy - for MPs just sell their votes, just as voters themselves do. The "vote motive" underlines the "vote market." We The People become wee, the sheeple.

We can happily do without the vote market and the vote motive.

All we need is The Perfect Rule - which is The Inviolability of Private Property - as I wrote about some days ago.

Natural Order. Natural Law. Natural Liberty.

Rats - And The Sinking Ship

The photo accompanying this post is from Jaitapur on the Konkan Coast just north of Goa, where a State-owned nuclear power plant is slated to come up. This photo appeared in Outlook, and shows our State Police meting out rough treatment to locals opposed to the forcible seizure of their lands, and also opposed to a nuclear facility in their area for reasons of safety. The report in Outlook says this about the Central State's choice of Jaitapur as a site for a nuclear power plant:

But in 20 years, as many as 92 quakes have been recorded here [Jaitapur], with the severest of them in 1993 measuring 6.2 on the Richter scale. The region is officially seismically marked as Zone III — Zone V being the worst category. And despite the elevation of the site on a plateau, concerns about a tsunami refuse to fade. It is perhaps keeping this in mind that Commerzbank, the German bank backing the project, pulled out even before the Japanese crisis, citing the “sustainability and reputational risk” involved.

There is another report, this time in Tehelka, which chronicles abuses of power by the State Police - who seem to be on the side of our The State and not The People, and must therefore be looked upon as Predators, not Protectors. The report begins saying that "lock-ups, prisons and court cases have become an integral part of the lives of Jaitapur’s residents." The opening para ends saying that this "scenic village" has been turned into a "state of dystopia."

[Dystopia is the opposite of Utopia: that is, a place where conditions of life are dreadful.]

Tehelka goes on to say that Section 144 of the Indian Penal Code (relating to unlawful assembly) has been in force in Jaitapur since August, 2010, in order to "maintain peace." They say false cases have been lodged against activists opposing the nuclear power plant. They add that the latest from the State Police is the arrest of 14 persons including a prominent nuclear plant opposer, Dr. Milind Desai.

The new chief minister of Maharashtra - who took over when the last chap was replaced by the CONgress High Command in Nude Elly because of his direct involvement in the Adarsh building scam - is the very same fellow who flanked Chacha Manmohan when he signed the nuclear deal with Sarkozy: Prithviraj Chavan, who then Minister for Science and Technology in Nude Elly. Tehelka says Prithviraj Chavan is "the PM’s point man for the Jaitapur plant and all other new n-plants coming up in the country." Thus, the new CM is very keen on seeing the project through.

However, when this chief minister visited the area, 10,000 locals turned up to meet him, shouting, “No nuclear power, no nuclear plant.” Writing about this public appearance of the CM, Tehelka says:

In front of a gathering of 10,000 Chavan had no choice but to listen to them, but he was visibly annoyed sitting on the dais, helpless.

When he finally spoke, Chavan stressed in an uncharacteristically aggressive tone the ‘misconceptions’ and misleading reports the locals were made to believe. He invoked national pride and the competition with China to justify the successful completion of the project, but appeared to have ignored local sentiment.

Thus, this new CM is an agent of Nude Elly - and a traitor to his own Maharashtrian people. Nude Elly, on its part, has committed High Treason against these simple and innocent village folk - as I wrote in a recent post.

In any case, electricity production by our The State should be opposed by all right-thinking citizens - if they desire regular, uninterrupted power supply. Electricity must be privatised - and private power producers will choose the fuels that are cheap and safe. Full liability will apply to them in case of accidents. This is what ought to be.

Let us turn to the people at the top - in Nude Elly. A timely column by Pritish Nandy - who has also been a Rajya Sabha MP (Shiv Sena!) - is titled "A ship about to sink." Here are some chosen quotes:

The Indian Political Philharmonic Orchestra must be the world’s most amazing cacophony of rogues, rascals and robbers. 

But now, enough is enough. Neither [Manmohan] Singh nor Pranab Mukherjee, nor anyone else is capable any more of saving this Government. It’s neck deep in its own sticky sleaze.... Look at Singh, wan and waylost.

But that doesn’t mean they are not malevolent. These are people who are destroying India from within. They are not just robbing you, me, and the exchequer. They are destroying institutions, subverting laws, vandalising our heritage and history, and trying to build a dazzling, amoral edifice of crime and corruption unprecedented in the nation’s history. It’s a scary scenario that could turn the land of the Mahatma into one gigantic Gotham City with a flyover to hell.

I had begun this post with the abuses of power being committed by the State Police against innocent people - and they are the rats in this sinking CONgress ship.

I am now even more convinced that every citizen should get himself a gun. We must all be fully capable of defending ourselves - against the State Police, who are our oppressors.

My ideal is India before the Police Act of 1861 - ironically, the very same year that Rabindranath Tagore, the poet who dreamed of an India "where the mind is without fear and the head is held high," was born. Till then, the "civilians" of the East India Company ruled without police support. All that these HEICS civilians did was maintain land records up-to-date and settle disputes.

In England, there were no policemen till 1829, when Sir Robert Peel established the Bobby of London - who remains unarmed.

And in good, old America, every town elected its own Sheriff - while every citizen was armed.

There is the other ideal too - of the Anglo-Saxon tribes of old, who had no notion of crimes other than "crimes against the individual," which were treated as Torts. I wrote about this "superior justice" of restitution (as against the retribution of today) just the other day.

Enough of these rats of the State Police. Let them go down with the sinking Pirate Ship of State. Let us be free. And let us be secure with our own arms.

The Bus Driver - Of Our The State

I was at the dilapidated State Transport bus station in Udipi, waiting for my bus to Karwar. There was just about enough time for a quick lunch, so I popped into the restaurant there for some idlis. Around me were a few employees of the State-owned bus company, including the driver of the bus I was about to board.  I decided to give them my frank opinion of their employer. It was heartening to find that they all agreed with me -  including the restaurant-owner and his staff.

In a nutshell, I told them that if their State-owned bus company was privatised, all buses would be run by private companies - for a profit. As employees of profit-making private companies, they would be much better off than they were today, working for a State-owned firm that makes chronic losses. Further, I added, if the State invested all its money in good roads, their lives as bus-drivers would be far easier. Given the terrible roads of today, I told them, their daily grinds must be pure torture. They all nodded in agreement - and my waiter even asked me to petition The State accordingly.

And then I boarded the bus - a rickety-rackety swadeshi rattletrap, dirty and grimy, fitted with the most uncomfortable seats imaginable. The driver clambered onto his seat and started the engine, which groaned and moaned like a stricken beast. From my seat, I hollered out at the driver: If buses were private, you would be driving a Volvo. He looked back at me - and smiled.

Our journey began - and the road, the Notional Highway #17, was the pits. I sat and reflected on the only bus trip I had taken in Europe - from London to Frankfurt - and how easy it was on bus drivers there, given the excellent roads. Easy on passengers, too.

A few hours later, the bus stopped at some small town - another dilapidated bus station - and I got off to enjoy a smoke. Chanced upon my driver and entered into conversation with him once again.

I suggested that people like him were not much different from  jawans in the Army or constables in the State Police - who slog it out for poor pay while their bosses and their political masters make hay. He looked down at his khaki uniform - and nodded sagely.

I noticed this phenomenon in Gujarat too, during my recent trip there. In Gujarat, there are no private buses - all are State-owned. The buses are terrible, the bus stations are terrible, and the roads are terrible as well. The Customer gets screwed. And the bottom rung of State employees who do all the dog-work think themselves privileged!

In my life, I have worked a brief while for The State, spent some time with a firm that made losses, and some more time with a firm that made profits. Of these, the last was the best. I always advise youngsters  to work for successful, profit-making firms, and to shun State employment.

I have also closely interacted with a few Class IV employees of our The State - and was always left with the feeling that if they had opted for entrepreneurship instead, they would have been much better off, not only materially, but also spiritually.

In the bad old days, State employment was preferred for its "job security" - and for its perks like free housing and lifelong pensions. Today, these must be seen as a hoax - because our The State practices inflationism. This is a way of cheating all workers - including State employees. Class IV employees of our The State are cheated the most - since their meagre savings get eroded.

Thus, privatisation and a drastic cutting down of the State Budget, accompanied by a massive retrenchment of its work-force is not only in the interest of the general public; it is equally in the interest of the numberless lower-rung employees of The State.

If Liberty prevails, entrepreneurship will flourish, and many good jobs will be created.

With free trade across land and sea, the Consumption of all will improve dramatically. With their wages, all workers will be possessed of world-class "wage goods."

If the Budget of The State is cut down and inflationism ended, the poorest workers will also be able to convert their savings into Capital.

Jawans, sipahis, peons, railway karamcharis, Air India hostesses - all should see their employer as a beast, and opt out. Their trade unions should come out strongly in favour of the reforms I have suggested above.

Yes, I am an Enemy of the State - by which I mean an enemy of the monsters on top. I am not an enemy of the small guys.

I shot the Sheriff - but I did not shoot the deputy.

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.

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.

Manmohan's Delusions Of "Collective Knowledge"

Our Great Leader, chacha manmohan s gandhi, said the following while giving away the Infosys prizes (for mathematics, sociology, social anthropology etc.):

A nation’s strength comes from the quality of its collective knowledge, the productivity of its working people, the creativity of its entrepreneurs and the dedication of its professional workforce.

What is the “collective knowledge” of our The State when it comes to traffic regulation? – so let’s forget about “regulation of markets” for a while. What about the “dedication” of our The State’s own “professional workforce”? – the bureaucracy. The latest news is that PSUs are losing 1.7 lakh crore rupees!

After this nonsense, chacha went on to oppose for-profit private sector education. He said:

With the growing share of privately funded for-profit educational institutions, this may be emerging as a worrisome barrier to freer access to knowledge for all our people.

The critical word is “access.” He believes that by making this access free, he will be able to give the poor and the unlettered access to “knowledge” – and this is knowledge acquired and disseminated by the “collective.”

Chacha further stressed the importance of “access to knowledge”:

A country’s prosperity too is a function of the knowledge its people possess and acquire. Indeed, it has always been so. But, what has changed in the last few decades is the access to knowledge. We live in an era of greater equity and equality as far as the acquisition of knowledge is concerned.

Actually, knowledge is “produced.” Everyone has free “access” to all the knowledge on Austrian Economics, for example, but very few “study” enough to “produce” even a newspaper article. You can equip a college with the world’s biggest library – access to knowledge – but you will still need hardworking scholars who will pore through all the knowledge of the past and “produce” it afresh for the present day.

State universities never “produce knowledge.” They are simply “teaching shops.” The teachers all teach the same old stuff year in and year out. Like “Indian Economics.” Propaganda.

Collective knowledge, indeed!

There Is No "Model" Of Liberty

The headline read: "Privatisation is not a solution for development" - and I clicked. Here is what I found.

The finance minister of Kerala, Thomas Issac, while speaking at a three-day annual international conference of the Network of Asia-Pacific Schools and Institutes of Public Administration and Governance (NAPSIPAG) at the Institute of Management in Government in Thiruvananthapuram, said that "privatisation is not a solution for development in Kerala."

What is the solution then, Mr. Minister? - nationalisation? PSUs?

The minister was arguing in favour of the "Kerala Model of Development."

According to the minister, "Development has to be designed in such a manner that emphasis is laid on decentralised participatory governance."

Frankly, this mantra of "decentralised participatory governance" is NOT what they practise. Kerala - like all our other states - has a State Planning Board, and two of its Members participated in these discussions. There is a Central Planning Commission in Delhi. Ours is a centralised State. The political parties are centralised. So is the bureaucracy.

Since only politicians and bureaucrats engage in State Planning, this is always "authoritarian."

It is The Market, on the other hand, that is completely "de-centralised," for its ultimate driving force is The Individual, in his capacity as a Consumer. Whereas he is alone, the fact remains that all the "higher" actors - the entrepreneurs, the technologists, the capitalists - they are trying to succeed by anticipating as well as satisfying the future needs of consumers as a "class." Consumers are "served" in markets - not "ruled."

The extremely worthy goal of "development" - which is an "economic goal" - can ONLY be accomplished by The Market.

"Economic development" in The Market is is an Individual Economic Achievement. It is based on Individual Knowledge.

These Individual Economic Achievements fund Taxation - which funds "State welfare" - which is something else. Welfare is NOT an "economic achievement."

The minister says, "the State would have to shift its development path with stress on knowledge-based and skill-based industries."

Earlier, I have quoted him saying, "Development has to be designed in such a manner that emphasis is laid on decentralised participatory governance."

As the italicised portions above show, this very "idea" is Centralised. Some Centralised Mind has to "design" development and "shift this path."

But all entrepreneurship and speculation is about The Future!

The Market works to satisfy almost all our myriad needs, because there are billions of individuals trying to satisfy future needs of "the masses" - all the unknown strangers out there.

In this market-based exchange order, "knowledge is fragmented."

That is why it works.

For the Future.

And "Five-Year Plans" are also about a future - the future thought of by a Centralised Mind.

Kerala "exports" its literate youth. There are no opportunities for them to make "economic achievements" in their own state. A good country attracts immigrants. People flee from bad countries. People have been fleeing communist Bengal for decades now. Millions tried to flee communist East Germany - and were shot!

The Kerala Model of Development doesn't work. It doesn't work because it is a State-based model. This "knowledge" - this "idea" - is false. It is the idea of the State as a "mastermind."

"What cannot be known cannot be planned," said Hayek, about this "idea."

Liberty is not a "model."

Liberty frees the Individual Mind - to plan the future of its proprietor. With its own "fragment of knowledge" - and many uncertain guesses about the unknown and unknowable future. Free to "speculate."

The process of knowledge acquisition is itself largely "speculative" - as students attempt to guess which course of study will give them the best jobs and careers. Often, they don't succeed - and switch to learning other skills. With rapid technological obsolescence, new skills will have to be learnt many times in one lifetime - and all in The Market. This is the "knowledge economy" that is fast emerging. No one can design a "model" of Liberty. The Market, after all, surprises us each day with new offerings. Liberty will be full of surprises too.

More Scams - And Some Questions

Yet another huge scam has hit the news! This is about UP during 2004 - 2007, while Mulayam was chief minister. Some 35,000 - 2,00,000 crore (1 crore = 10 million) rupees worth of grain (estimates vary) meant for the poor were stolen by State functionaries.

Makes you realise that this "right to food" business is part of our "right to fraud."

Think about it - the huge involvement of our The State in foodgrain: first, they buy up foodgrain at high "support prices" from (rich) farmers; then they store this grain, usually in the open, under plastic sheets; then they transport this grain (now depleted by rats) to government shops all over the vast landmass; then they pretend to sell this grain cheap to the poor... but then, the grain often gets stolen on the way.

All this costs them so much that they have to print money to pay for it.

This causes inflation.

Wouldn't the poor be better off if traders sold them grain? - just as they do all other things, from vegetables and fruit, milk, meat and fish, spices, cloth, mobile phones....

As Bastiat said, socialism is all about "false philanthropy."

I wonder what Bastiat would think about the second piece of news I found - that our The State is pumping in Rs. 1200 crore rupees into Air India next week. This cannot be philanthropy - for the poor do not use Air India. I, for my part, would prefer to call it "loot."

Of course, if Air India was sold off, and civil aviation de-regulated, the poor would benefit - and more poor people would fly. I discussed this the other day.

The Lesson: Socialist politicians can never help the poor via The State. They only help themselves. They end up screwing up State budgets - and this leads to higher taxation, higher borrowing, quantitative easing - and inflation. Private investments fall. Thus, if we want the poor to climb out of poverty, we must put an end to all this "false philanthropy." Let private investments grow - so the poor get jobs. Let there be competitive markets and free trade - so the consumption of the poor improves. Let there be Liberty and Property - so the poor can raise Capital and become entrepreneurs themselves. All solutions to poverty lie in The Market. The State is the primary cause of impoverishment.

This lesson is drummed home by this slideshow I found today - on the miserable condition of the finances of the government of communist West Bengal, a government that hates business and loves to throw money at the poor. West Bengal is the most indebted state of the so-called Indian federation: its debt burden stands at a staggering 2,00,000 crore rupees (1 crore = 10 million). Of whatever revenue it extracts from its poor people, this government spends 97 per cent of this on interest payments on past debt and salaries of present employees. How is this colossal debt ever going to be repaid? How many future generations of Bengalis will be burdened with this debt?

There are an entire host of state governments that are completely broke. UP, Bihar, Orissa, Maharashtra - these are all deep in debt. On the extreme, there are many state governments that depend entirely on Central funds - Kashmir, Manipur, Chhatisgarh, Jharkhand, Nagaland, Tripura.

And as for the Central State - in this year's Budget, they announced plans to borrow Rs. 3,50,000 crore rupees.

Not one paisa of this huge amount of money (which will eventually have to repaid by us, and our descendants) will be "invested." All of this will be "consumed." Rich, poor, middle-class - all will be hurt.

Now, ain't it kinda strange that the man at the top is supposedly an "economist"?

But then, is he a "politician"?

Has he been "democratically elected"? Yet, he is into his Second Term!

Lots of questions to ask ourselves, in this lootocracy.

They Don't Really Care About Us

While scandals on government corruption never seem to end, it has been useful for the personnel of our The State to find an excuse to point to private-sector "greed" - and thereby portray themselves as our "protectors" from that greed.

The case in point is about our new private airlines. There isn't a single Indian who would prefer a return to the days of State monopoly over domestic civil aviation. Yet, because of the fact that some of their "spot fares" - that is, on tickets booked shortly before departure - seem too high, our minister for civil aviation, Praful Patel of the NCP, has been making some very strange noises. According to this news report, the minister is "setting up an economic advisory council, which will meet on 10 December to discuss what are reasonable fares." In the same report, the minister makes this claim in support of his interventionism: "We are here to help the sector to grow while keeping in mind interest of the passenger."

For one, the huge taxes being levied on air travel disprove this grandiose claim. These taxes are, in fact, screwing the passenger. They keep our unsafe railways afloat - who deserve to be out-competed.

Second - the ministry continues to bar the entry of new players. The only answer to high fares is competition. That is, the only counter to one company's greed is the greed of other companies. The greedy State will only make things worse.

Third - in the field of civil aviation, our The State is very much a greedy player. This minister runs Air India and Indian Airlines, and their various off-shoots. Because their losses are covered by the taxpayer, these State-owned airlines offer "unfair competition" to their private sector rivals. In a free market, they would have folded up long ago.

Thus, the passenger-taxpayer is being doubly screwed. The State must therefore exit civil aviation completely. Thereafter, the sector must be completely de-regulated. Only then can the "interest of the passenger" be served. Indeed, the poor Indian passenger would then probably be served a drink after take-off - something our The State prohibits today. Triply screwed!

The most inspiring story of de-regulation of civil aviation comes from the US. They used to have a Civil Aeronautics Board (CAB) that not only regulated fares, but also awarded routes. Market principles did not work at all - and political graft ruled the roost. Anthony Sampson's history of the early years of civil aviation Empires of the Sky: The Politics, Contests and Cartels of World Airlines (1985) noted that, with the CAB, airlines had a "murky relationship with the US President."

Then, in 1977, along came Jimmy Carter with different ideas. He installed Alfred Kahn, an economist, as head of CAB. Kahn did the unthinkable: he de-regulated the CAB out of existence! No more CAB! This "father of airline de-regulation," as he is now known, brought into being a host of "low cost carriers" - like People Express and Southwest Airlines. Kahn inspired Europe - and the Thatcher era saw Freddie Laker taking on the "Big Five" with his SkyTrain across the Atlantic. The rest is history.

We in India need an Alfred Kahn - not this NCP man, Praful Patel, with his double-speak.

Praful Patel hails from a political family - his father was a prominent CONgressman. His constituency lies in Gondia, in the poor Vidarbha region of Maharashtra. He is also big in business - a sort of "bidi king." These business interests have since diversified - into pharmaceuticals, real estate and packaging. This apart, he also runs the "Gondia Education Society" that, according to his profile on the party website, "imparts education to 80,000 students in all disciplines ranging from Arts, Commerce, Engineering, Law, Pharmacy, Information Technology, and Computer Sciences."

According to Wikipedia, Praful Patel is "a former Director of Jet Airways."

Methinks we need an Alfred Kahn.

Predatory State Writ Large

The central government's ministry of environment has given its clearance for the setting up of a nuclear power plant in Jaitapur, Maharashtra, on the Konkan Coast. This is an ecologically sensitive area, with fragile bio-diversity. Jaitapur is close to Ratnagiri, where the world-famous Alfonso mangoes come from. A nuclear accident here would be an unmitigated disaster - affecting even Goa, which lies a little south. It is also a fact that Parliament has passed legislation to the effect that, in case of nuclear accidents, liabilities will be "limited." So, if Ratnagiri mangoes and Goan tourism are wiped out, no one will bear responsibility.

But is a nuclear accident possible?

First: If such an accident was impossible, why would Parliament be so keen to pass legislation limiting liability - and why would the suppliers of equipment insist on such legislation? Indeed, such legislation provides them with the incentive to supply sub-standard equipment.

Second: The news report on the environmental clearance for the Jaitapur nuclear power plant contains this chilling sentence:

Jairam Ramesh, central environment minister, "pointed out that his ministry has no jurisdiction over radiology emission — a major concern among locals and environmentalists."

I also found this statement nonsensical:

"We need to change our fuel mix as 35 per cent of our carbon dioxide emissions come from electricity,” said Ramesh.

According to me, what we in India need to do urgently is change our electricity supplier - from The State to private businessmen. Let these private businessmen decide on the fuel. And let there be full liabilities in case of accidents - thereby giving them the incentive to take full precautions.

When I was in Mangalore many years ago, I was pleased to find that a barge-mounted power plant had come up on the sea, built and operated by a private company, using naptha (or was it gas?) as fuel. This is the way to proceed - especially in this ecologically sensitive Konkan Coast. If barge-mounted power plants become the norm, there would be no need for what the Maharashtra government has just announced: that "a group of ministers was working on the compensation package for the 2,335 farmers who are expected to be affected by the project." 2,335 farmers means more than 10,000 individuals if we include their families - and many thousands of hectares of precious land. This is, once again, a violation of Property.

The news on television mentioned that this nuclear power plant was being hurriedly cleared with an eye on President Sarkozy's visit to India - as this plant is to be built by the French company Areva.

This is a very big black mark on the CONgress-led government of Chacha Manmohan. His emphasis on nuclear power plants operated by The State is flagrantly anti-people - and anti-business as well. It is also anti-growth - because chronic power shortages are crippling economic activity throughout this vast sub-continent. Privatisation of power ought to have been top priority.

I found another black mark against Chacha's government this morning, in this editorial in Mint, which comments on his management of State finances. I quote:

The second supplementary demand for grants, tabled in Parliament in this session, when combined with the first one, pushes up the government’s spending plans by Rs74,400 crore, close to 1.1% of GDP, roughly 7% higher than the original budget. Much of this expenditure is on account of food and fertilizer subsidies, oil under-recoveries, defence and internal security expenditures. This spending will practically wipe out all the surplus revenue garnered from the 3G spectrum auction. In effect, recurring expenses have been met by the sale of a one-off item. There are plans to fund future expenditures of this kind by selling the government’s stake in public sector undertakings.

As the italicised portion in the quote above shows, our The State is WASTING the money it has received from the 3G auction - and it is this that should be considered a scandal. The huge amounts 3G operators have had to pay for spectrum is affecting consumers, who have to pay more for 3G services: lose-lose. Further, the manner in which 3G revenue has been wasted indicates that the "corruption" in 2G spectrum allocation was a "good thing" - for private businessmen saved money that The State would have wasted anyway. This ToI blog post by Rajeev Mantri echoes my sentiments.

Whereas Chacha Manmohan's record in misgovernment speaks loudly for itself, I found Ratan Tata's endorsement of his premiership most surprising. In this long interview, one that was broadcast on TV yesterday, here is what the chairman of the Tata Group said of Manmohan:

...he [Manmohan Singh] is a tremendously good man, we’re very lucky to have a prime minister like him.… he is one person who is truly above the allegations that have been thrown at him, a person who we are very lucky to have because it is his face that has been the face of a transforming India. And it is this person who has commanded the respect of leaders in major countries.

Let us now turn our attention to how poor people and very small entrepreneurs view our The State. Niranjan Rajadhyaksha, editor of Mint, has written a brief column on this today, from which I quote below:

The poor live with corruption as a fact of life. Almost every transaction they have with the Indian state involves payment of a bribe. The Indian chapter of Transparency International published a study in 2008 on corruption faced by below poverty line (BPL) households across the country. Eleven government services were rated according to the prevalence of corruption. Transparency International points out that the highest corruption is in need-based services that are monopolies (police) or involve asset creation (land records or housing).

Rajadhyaksha calls for police reforms and computerisation of land records. I would have preferred the words Liberty and Property. That is - not "police reform" but "constitutional reform."

Thus, to me, there is no doubt about it. Ours is indeed a Predatory State. Even the ministry of environment is a predator. If "environmental clearances" have to be given, these should come from local institutions - and not the central State.

To poor people, the police and the land administration are predators.

We Indians must think of another way - Liberty, Property, Localism, Catallaxies.