The dark lord says:
The typical arguments are made by the right too. If the economy is going good “see, the deregulation has brought about unprecedented wealth. How can you propose more regulation?”
When the economy goes bad, we get the answer “see, the crisis is brought about due to regulation in the housing mortgage market. How can you propose more regulation?”
Yes, the libertarian right makes this argument, but there is a consistency in it. We believe that most regulations do harm, and that a lightly regulated economy works best.
If the socialist left made the counter-argument, that too would be internally consistent. If you really wanted to regulate the economy all the way to the Soviet Union, you could justifiably claim that both the US and India are variants of the same system. But in my post, I wasn’t arguing with the socialist left – I don’t need to, as history has already answered them.
My argument is with those who say that “we need a free market with some regulations, but that doesn’t mean that we should be socialist”. If you hold that belief, I would expect you to believe that there is some point at which additional regulations do more harm than good, so you’d support some regulations and oppose others. But what I notice is that for supporters of regulation, the right amount of regulation is always “A little more than we have now”.
I have written the opening editorial for the March 2009 issue of Pragati. It should be out any time now. This is how it starts:
A visitor from the 17th century would be rather surprised to learn that the United States of America of 2009 is in distress. He would of course be no stranger to troubled times, but in his time, troubles came in the form of famines, diseases, strife and taxes. This blight called “recession” that has struck the United States would seem strange to him. Factories that were at full steam two years back are now idle, though their productive capacity is undiminished. Healthy men and women who were working in those factories now sit at home. Goods lie in warehouses even while vehicles to transport them in and roads to carry them on remain intact. Further inquiry by our visitor would reveal that the cause of the United States’ trouble is a breakdown in the system by which it co-ordinates demand and supply, present and future consumption, and risk and reward. The visitor would not be prepared for the scale and sophistication of the system that has now suffered a setback, but he would be no stranger to the idea of markets. Markets and traders have existed for as long as humankind has, and so have attacks against them.
Read the rest when you get the issue in your mailbox
A year back, we were visiting my wife’s relatives. The head of the family, my wife’s uncle, used to be in the police force before he drank himself to death.
As is the norm in these cases, his eldest son was given a job in the police department. Of course, he had to pay a bribe for the job. He got a discount because of his late father, but he wasn’t exempted. If the son had been a graduate, the amount would have been lower, but he would still have had to pay.
And oh – he did not get an actual policing job. That would have cost him much more. He was given a clerical job in the department, dealing with personnel matters. That cost lower.
“I don’t suppose you have any opportunities to make extra money in this section?” I asked him.