The levels of public engagement

C.V. Madhukar writes

“Many existing “think tanks” appear to be more focussed on producing research output
than in engaging more widely with policy makers. For a number of professionals in various walks of life, politics has been anathema all these years.”

More on The revealed Samuelson!

T C A on “Paul Samuelson, RIP”

Teachings of Paul

Michael M. Weinstein on The foremost academic economist of the 20th century

Hayek on Hayek

Nothing I expected more than this on Hayek!!

Russ Robert’s response is here

Paid votes vs paid politics by Chandra

Many new debates have been kick started after the recent general election and many state elections in India. Among them was paid advertisement of politicians to raise there voice as a politician or to prove a point. One such case here is showing a new age. P. Kodanda Rama Rao, who is with Loksatta Party, Warangal said in an Outlook issue of 21 December 2009.

He said:

“I was worried readers weren’t even aware I was in the fray. To prove a point, I called a reporter in Ennadu and paid 50,000. I got three half-page features highlighting my worth as a politician.” (Page.32).

There are many many such cases read the piece on “News you can abuse”.

Paul A. Samuelson, Economist, Dies

Paul A. Samuelson, Economist, Dies at 94

Is there any correlation between The Beautiful Mind and The beautiful Tree?

Watch latest interview of Prof John Nash here

The Beautiful Tree By James Tooley

Bluffing playing

T C A on:

“..Darshan Singh Pheruman who fasted till he died for a political demand which was not conceded. On August 15, 1969 Darshan Singh, demanding that Chandigarh and some other areas also go to Punjab after the creation of Haryana in 1966, went on a fast unto death inside the Amritsar Jail. The Centre did not budge. On 27th October, 1969, he died.”

Indian Education umbrella may seem ludicrous!

Devesh Kapur writes:

“It was recently reported that a UGC study covering 14 central universities found that 42 per cent of posts at the level of professor, 29 per cent at the reader level and 34 per cent at the lecturer level are lying vacant.”

Also read “Why UGC should go federal” this is piece by one my teacher!

Dreams never die

Charles Krauthammer on “The new socialism” and environmentalism

A bit from his piece:

• “With socialism dead, the gigantic heist is now proposed as a sacred service of the newest religion: environmentalism.
• The idea of essentially taxing hardworking citizens of the democracies to fill the treasuries of Third World kleptocracies went nowhere, thanks mainly to Ronald Reagan and Margaret Thatcher (and the debt crisis of the early '80s). They put a stake through the enterprise.
• This naked assertion of vast executive power in the name of the environment is the perfect fulfillment of the prediction of Czech President (and economist) Vaclav Klaus that environmentalism is becoming the new socialism, i.e., the totemic ideal in the name of which government seizes the commanding heights of the economy and society.”

The demands for Vidarbha, Gorkhaland, Harit Pradesh, Kongu Nadu,

Ramachandra Guha has piece explaining the need of new State in Andhra. He also urge for forming new States Reorganisation Commission (SRC):

Some excerpts:

• ‘The people of Telangana find themselves in an unenviable state. Their fellow countrymen outside the State of Andhra Pradesh, are unable to understand, much less appreciate, the significance of the revolt in Telangana’.
• ‘The moment Telangana elected representatives dehypnotise themselves from the lure and pressure of the Andhra political bosses, and fall in line with the aspirations of their electors, the movement will reach its natural culmination’.
• K. Chandrasekhar Rao, embodied the sentiments of millions of people. Since he was more obscure, and the prime minister of the day more powerful, it took his death (after 58 days without food) and the intensification of the street protests for the Centre to concede the new state. This then led to protests by Kannada, Marathi, and Malayalam speakers, in response to which a States Reorganisation Commission (SRC) was created, which, in 1956, officially mandated the principle of linguistic states.
• In retrospect, it is clear that this reorganisation consolidated national unity, such that India did not go the way of Pakistan and Sri Lanka, which had to suffer bloody civil wars because of the unwillingness to grant linguistic autonomy. However, our nation-state is comparatively young, and still evolving. It now faces a second generation of challenges, these pertaining to the regional imbalances in social and economic development. A new SRC should be constituted, which would look dispassionately into the demands for Vidarbha, Gorkhaland, Harit Pradesh, Kongu Nadu, and other such. Its mandate should also include the granting of real financial and political autonomy to panchayats and municipalities.
• To do its task fairly and honourably, a new SRC must draw its members not from political parties but from the law, the academy, and the social sector. The members of the first SRC were the jurist Fazl Ali, the author and diplomat K.M. Panikkar, and the social worker H.N. Kunzru. India today has a comparable set of distinguished and independent-minded people. Some names for a fresh SRC I might suggest are the jurist Fali Nariman, the economist Jean Dreze, the sociologist André Béteille, and the social worker Ela Bhatt — but there would be others, too.
• Meanwhile, expect Jaswant Singh to put aside his pen, thus to answer his constituents’ demand that he make Gorkhaland the sole object of his attentions. Ajit Singh may also be stirred out of his present lethargy to lead the movement for Harit Pradesh. As for Rao, he certainly knows the parallels with the movement in the 1950s for a separate Andhra. Potti Sriramulu’s fast was conducted in Madras; because he lived there, and because he wanted Madras to be the capital of Andhra Pradesh. In the event, Sriramulu’s supporters got their state but not that city. Rao’s greatest fear now must be that history would repeat itself in toto, such that they have their Telangana, but without Hyderabad.

The road to Climate Change is death mark

Don't let the climate doubters fool you

A forgotten national leader!

Today is the 131st birth anniversary of Chakravarthi Rajagopalachari, affectionately called as Rajaji.

A year ago B.R.Haran wrote:

"It is an irony that the Chief Minister, who has been a hardcore adversary of Brahmins and who has been criticising and abusing them till the day before yesterday, has made a u-turn yesterday and said that he was never against Brahmins! Apart from his claims of giving paltry ‘financial’ assistances to Brahmin scholars, can he show a single good thing, which he has done for the Brahmin community in the capacity of Chief Minister during his five terms? When he can introduce the ‘1 kg rice-1 Rupee’ scheme on Anna’s birth anniversary, why couldn’t he introduce ‘prohibition’ on Rajaji’s birth anniversary? If not prohibition, why not a few ‘vocational’ courses in schools?

Similar to the Dravidian parties, the Congress party has also not bothered to celebrate Rajaji’s birth anniversary. The days are not far off for this ‘one-family’ party to forget Gandhi too! If the present day political parties prefer to ignore the leaders of the past, then it will not demean those great leaders, but it means that these parties are only insulting themselves!"

Humanuncut

Indiauncut bloger Amit Verma wrote in his first Novel My Friend Sancho:

“Humans as a species would not exist if not for extremely improbable things happening consistently over millennia……….we are all products of accidental events- and after they happen, we look back at them as if they were inevitable, constructing narrative where none exist.”, p.211.

Indian Education Mess (IEM)

In one day, the little boy’s of my land lord asked me What is government? Before I answer that question I asked them what their teachers have taught. Their answer was ‘nothing’. Then I asked what they have read in the Text Book. They have showed me the following text from the book-Social Science- Social and Political Life-1, Chapter-3, page 27:

“What is Government?

Government sought to protect rights of unorganized workers

Govt, fixes price of onions, says no shortage in market

Detailed plan to tackle floods soon, says government

Supreme Court can have five more Judges: Govt.

Govt for revamping coal and power sector

Over 15,000 villages declared scarcity hit by government……”

I am not surprised to see the definition of ‘What is Government?’ in the Text Book of Class VI. Though, this Text Book was prepared by The National Council of Educational Research and Training (NCERT).

They were paused when I said that the definition of government is nothing but to ensure the life, liberty and property of the individual citizen of a country. And its role is to ensure people’s life, liberty and property through the civilized law and order system, morally matured defence system and equal opportunity to everyone. Then I went on to say there is a great amount of danger in government functions in India and elsewhere. Freedom is ruined and property is threatened.

Hope in one day they will realize I meant.

Currency, or money, is what allows civilization to flourish

Ron Paul’s “Free Competition in Currency Act”

The road to Climate Change is death mark

George F. Will writes:

"The travesty is the intellectual arrogance of the authors of climate-change models partially based on the problematic practice of reconstructing long-term prior climate changes. On such models we are supposed to wager trillions of dollars -- and substantially diminished freedom."

Why people fear the state?

Pratap Bhanu Mehta review on Arun Shourie book

“why people fear the state. The rhetorical use of victims’ rights cannot obviate the fact that a state is a state only if it has a moral identity. The so-called “weak laws” have become a self-serving alibi for larger institutional failures of the state. There is also considerable comparative evidence of how draconian security laws add little to law-enforcement capability.

……..state is hoist on its own petard because it often overestimates the power of power.”

The road to Climate Change is a death mark

Here is what Barun words:

"Barun Mitra, however, had a different argument. He said it is growth which leads to a green and clean environment.

"Economic growth invariably creates energy efficiency and leads to a greener environment, while poverty makes people vulnerable," said Mitra.

"If we can get rid of poverty we can solve the problem," he added.

At this, Mitra reiterated his point and said, "Poor always pays the highest price in all casualties because of the fact that he is poor. The only way to deal with the poor issue is growth."

Mitra gave a new argument and claimed there has been nothing like climate change in the world.

"Science is not about answers, it is a quest, a search. The email-gate clearly establishes how corrupted the scientist community can be when they hand in glove with the political establishments," he emphasised."

The State feeds off hard earned efforts

Rupert Murdoch says:

“The most damning problem with government "help" is what we saw with the bailout of the U.S. auto industry: Help props up those who are producing things that customers do not want.”

A lonely voice in US means forget everything in India!!

Ron Paul says "I'd like to know who they bail out and why,"

The professional practitioners of development and well-paid warriors against poverty are not as wise and all knowing as they might think they are

They are no fools, and the professional practitioners of development and well-paid warriors against poverty are not as wise and all knowing as they might think they are

As I myself have experienced in the villages of Madhya Pradesh near Indore and wrote it here in this blog some time ago.

Here is a former IAS officer note back to his practice about in and out of his mind. In a way he become a Hayekain now!! Even more than that! Whether he knows or not?

Some excerpts from his piece in today’s Indian Express:

• A good deal of money was spent (maybe there was a World Bank loan!), houses were built in an urban row-house pattern, and these were handed over to the tribals with much fanfare by political bigwigs who got a nice photo-op, and maybe even some genuine satisfaction at having done something good for these ‘ ignorant, poor people’.
• Three months down the line, a team went to visit the place to see how the tribals had taken to the new life style. To its utter disbelief, the team found that the tribals still continued to live in their traditional thatch roof huts, and were using the newly built houses to keep their beloved livestock!
• Buffaloes, cows and goats were happily munching their feed off cement floors, and the air was redolent with the unmistakable smell of dung and droppings. The tribal people just could not sleep in those brick and mortar houses, or use the strange toilets, or cook in the confined kitchens, and so what better use of the new houses than to utilise them to keep their precious cattle? The project, obviously, was not a success
• …..development plans conceived and implemented without any real understanding of the people being ‘modernised’, and without any consultation with them.

ANECDOTE TWO: RURAL HOUSING IN EARTHQUAKE HIT GUJARAT, INDIA, CIRCA EARLY 2000’S.

• We found that the newly built villages had small but neat two room houses of brick and mortar, with mosaic floors, electricity, and even an attached toilet. To me, it seemed that these would be rejected by the villagers the same way the tribals of Betul had rejected the houses built for them.

• I asked myself, why this difference in attitude from that of the tribals of Betul, and realised that the main reason why there was no criticism or rejection by them of these new style houses was that the state government had, very wisely, followed a participative process, and had in fact left the planning of the new villages and houses largely to the NGOs and the end users, unlike in the case of Betul where all planning was done by outsiders who wanted to provide what they considered to be ‘good’ for the tribals to them.

• What is really relevant is that the lesson is the same now as it was forty years ago, which is that only development initiatives which are done in consultation with the beneficiaries shall succeed, and where they feel that they are participants in development and not just recipients of charity. They are no fools, and the professional practitioners of development and well-paid warriors against poverty are not as wise and all knowing as they might think they are.

The motto of the Climate Olympics,

• Surjit S Bhalla on Cold War attitudes of Oh Marx, I am so poor and they are out to get me
• Kiran Karnik on Incubating innovation in India
• Kirit Parikh on How India can cut its energy needs by 20%!

World's worst polluting nations

Rediff Business Desk report:

• The world's 10 biggest polluters

Thomas Sowell's-"The Housing Boom and Bust"

• How Fannie Mae And Freddie Mac Sank In The Subprime Quicksand
• The fourth of five parts of a Monday series excerpting

Power and Property

Tirthankar Roy on Power and Property

• ……..during the colonial period, a broad-based commercialization and a state that wanted to consolidate private property rights, led to a legal and market regime in which communities had to shed their isolation,
• ……….If we compare the complex of case laws in 2000 with that in 1850, it would seem that private rights have won the battle, but not without great economic and social cost.
• ………the Kings in precolonial India were expected to function within a moral order that included the notion of a social contract. The principle of the contract was to respect the juridical-economic-cultural autonomy of those collectives that supplied essential services for the state. All states are built upon alliances. There was no essential difference between Europe and India in this respect.

Good night watchmen

……..the development expenditures of the colonial state declined over time. We can do no better than to echo Tomlinson’s conclusion, that “the advances that were made in India . . . were largely achieved in spite of the inertia created by an administration that ruled in economic matters by a mixture of benign and malign neglect.”

India's Block Roots

India lacks a high level professional school for political leaders for administrative, visionary and activation knowledge to govern the country as per India’s political roots.

Politics is not a profession but a vocation of unequal truths

David Brooks writes:

• …..“campaign, like …………built on a series of fictions. The first fiction was that government is a contest between truth and error. In reality, government is usually a contest between competing, unequal truths. The second fiction was that to support a policy is to make it happen. In fact, in government power is exercised through other people. It is only by coaxing, prodding and compromise that ………actually get anything done.
  
• The third fiction was that we can begin the world anew. In fact, all problems and policies have already been worked by a thousand hands and the clay is mostly dry.
  
• The fourth fiction was that leaders know the path ahead. In fact, they have general goals, but the way ahead is pathless and everything is shrouded by uncertainty."

Economic Development and religion or traditions

“……religion or traditions, which apply only to particular circumstances of nations, are often discounted as being least important in economics. These variables, which cannot be measured in quantifiable terms, may have a totally unexpected impact in the final analysis.”

From Marginal Revolution:

Davide Cantoni (who by the way is on the job market, from Harvard) reports:

Many theories, most famously Max Weber's essay on the 'Protestant ethic,' have hypothesized that Protestantism should have favored economic development. With their considerable religious heterogeneity and stability of denominational affiliations until the 19th century, the German Lands of the Holy Roman Empire present an ideal testing ground for this hypothesis. Using population figures in a dataset comprising 276 cities in the years 1300-1900, I find no effects of Protestantism on economic growth. The finding is robust to the inclusion of a variety of controls, and does not appear to depend on data selection or small sample size. In addition, Protestantism has no effect when interacted with other likely determinants of economic development. I also analyze the endogeneity of religious choice; instrumental variables estimates of the effects of Protestantism are similar to the OLS results.

The full paper, and other work by Cantoni, is here. I believe this is the most thorough statistical test of the Weberian hypothesis to date.

More on “Peter Bauer and the Economics of Prosperity”

Peter Bauer and the Economics of Prosperity James A. Dorn, Barun S. Mitra (EDS.) Hard-bound Book (6¼" x 9¼") : Pages : 192 2009 Edition : ISBN - 978-81-7188-665-4 Price : INR 595 / US $ 16.95

ABOUT THE BOOK :

• Peter Bauer was an unlikely revolutionary, yet he inspired a revolution in development economics. In an environment dominated by a poverty of clear economic thought, Bauer built his theories of economic prosperity. He fought to free the poor from the tyranny of poverty. With the recent spread of anti-market, anti-trade, and anti-migration movements in many parts of the world, it is important that we take a fresh look at the way Bauer exposed the fallacies behind these protest movements. He showed them to be anti-poor and anti-people, and to be exacerbating global poverty. This volume is an attempt towards helping in introducing the ideas of Peter Bauer to a new generation of readers.

ABOUT THE EDITORS :

• James A. Dorn is Vice President for Academic Affairs at the Cato Institute and Editor of the Cato Journal. He is a China specialist and a regular contributor to Caijing (online), China’s leading business and finance magazine. His articles have also appeared in the Financial Times, Asian Wall Street Journal, South China Morning Post, and Australian Financial Review. He has taught at Fudan University in Shanghai and is currently Professor of Economics at Towson University in Maryland.

• Barun S. Mitra is the Director of Liberty Institute, an independent think tank based in New Delhi, which is engaged in public policy research and advocacy with the aim of promoting economic and political freedoms. He is an engineer by training, and writes on a wide range of developmental, economic, environmental and technological issues. He has been published in a number of national and international newspapers and journals. He received the Julian L. Simon Award for his contribution in explaining the role of market economics in harnessing human ingenuity and creativity, leading to improvement in economic well-being and environmental quality. He is a member of the Mont Pelerin Society.
  

CONTENTS IN DETAIL :

Foreword
Acknowledgements
Editors/Contributors
Preface
Remembering Peter Bauer
— James A. Dorn
Peter T. Bauer: A Brief Biography
— Ralph Harris

Part 1 Development, Freedom and Prosperity
1. Reflection on Peter Bauer’s Contributions to Development Economics — Milton Friedman and Thomas Sowell 37
2. Peter Bauer: An Unusual Applied Economist
— Basil Yamey
3. How Does Development Happen?
— Amartya Sen
4. P.T. Bauer’s Market-Liberal Vision
— James A. Dorn
5. The Market, Yes; Demos, No
— James M. Buchanan
6. Human Attitudes and Economic Growth
— Israel M. Kirzner

Part 2 Migration, Foreign Aid and Poverty
7. Migration, Globalisation and the Spirit of Peter Bauer
— Daniel T. Griswold
8. A Voice for the Poor
— The Economist
9. A Titan Passes Away
— Swaminathan S. Anklesaria Aiyar
10. A True Friend of the World’s Poor
— Sauvik Chakraverti
11. Peter Bauer and the Third World
— Anthony Daniels
12. P.T. Bauer on the Population Question
— Nicholas Eberstadt

Part 3 Bauer on the Economics of Prosperity
13. Economic Control or Economic Development?
— P.T. Bauer
14. Indian Economy Policy and Development
— Peter T. Bauer
15. B.R. Shenoy: Stature and Impact
— Peter Bauer
16. The Disregard of Reality
— Peter Bauer

Index
CONTRIBUTORS:

• Swaminathan S. Anklesaria Aiyar is consulting editor of The Economic Times newspaper in India, and research fellow at the Cato Institute in Washington DC. He writes the popular weekly column ‘Swaminomics’ in the Sunday Times, India.
• Peter T. Bauer was Professor Emeritus of Economics at the London School of Economics, University of London, and a Fellow of the British Academy.
• James M. Buchanan is Distinguished Professor Emeritus of Economics at George Mason University and the 1986 recipient of the Alfred Nobel Memorial Prize in Economic Sciences
• Sauvik Chakraverti is the senior assistant editor of The Economic Times newspaper in Delhi.
• Anthony Daniels is a medical doctor and is the author of From Zanzibar to Timbuktu. He writes for The Spectator, as Theodore Dalrymple, and is a contributing editor of The City Journal of New York. This article is adapted from his dinner address at “A Conference in Tribute to Peter Bauer” hosted by the James Madison Program, Princeton University, May 7, 2004
• Nicholas Eberstadt is the Henry Wendt Scholar in Political Economy at the American Enterprise Institute. An earlier version of this article appeared in The Public Interest (Eber stadt 2005).
• Milton Friedman was a Senior Research Fellow at the Hoover Institution and the 1976 recipient of the Alfred Nobel Memorial Prize in Economic Sciences. Thomas Sowell is the Rose and Milton Friedman Senior Fellow on Public Policy at the Hoover Institution.
• Daniel T. Griswold is Associate Director of the Center for Trade Policy Studies at the Cato Institute in Washington and author of the recent Cato study, ‘Willing Workers: Fixing the Problem of Illegal Mexican Migration to the USA.’ He has authored numerous studies on international trade and globalisation.
• Ralph Harris was the founder president of the Institute of Economic Affairs, London. He was made a life peer as Baron Harris of High Cross, of Tottenham in the County of Greater London.
• Israel M. Kirzner is Professor Emeritus of Economics at New York University.
• Amartya Sen is Lamont University Professor and Professor of Economics and Philosophy at Harvard University, former Master of Trinity College, Cambridge, and the 1998 recipient of the Alfred Nobel Memorial Prize in Economic Sciences.
• Thomas Sowell is the Rose and Milton Friedman Senior Fellow on Public Policy at the Hoover Institution, Stanford University, USA. He has published over two dozen books, among them Basic Economics: A common sense guide to economics (Third edition, 2007), Conflict of Vision (Revised edition, 2007), Affirmative Action Around the World: An Empirical Study (2004), Conquests and Cultures: An International History (1998), and Ethnic America: A history (1981).
• Basil Yamey is Emeritus Professor of Economics at the London School of Economics and Political Science and a Fellow of the British Academy.

Same evidence keeps slapping us in the face.

Aakar Patel writes:

• “Its architects Hirsch Bedner say their estimate for it is around $2 billion. That is Rs9,000 crore, and four people will live in this house. That is Ambani’s contribution to our culture.
• The Birlas built schools for the rich, and the Ambanis made a school for millionaires.
• BITS-Pilani’s fee is Rs1 lakh per year, Birla Vidyamandir’s fee is Rs1 lakh per year and Dhirubhai Ambani International School’s fee just for classes XI and XII is Rs7.57 lakh.
• At the Aditya Birla Memorial Hospital (“Compassionate Quality Healthcare”), a check-up for headaches costs Rs2,850.
• At the Kokilaben Dhirubhai Ambani Hospital (“Every Life Matters”), the wellness check-up costs Rs5,000.
• At the Tata Memorial Hospital, which treats cancer, healthcare is free.
• Rajashree Birla says Indians “don’t have the mindset to give away large amounts of money to charity”. The act of leaving “just a little bit for their children”, she says, “happens only in the US”.
• “It calls for very large-heartedness,” she says, “I don’t see this happening in the Indian context in the near future at least.”
• She’s right about our mindset and culture, but wrong in assuming that the problem is about large-heartedness: It is actually about a lack of civilization.
• She’s wrong also about this not happening in future: It already has happened in India.
• Of Tata Sons’ 398,563 shares, 65.8% is held by charitable trusts (Ratan Tata owns 0.84%).
• How much money are we talking about? Tata Sons’ net profit last year was Rs3,780 crore.
• Tata Sons owns 74% of Tata Consultancy Services and 84% of Tata Motors. If wealthy Indians want to give back to society, they need only buy Jaguar and Land Rover, and not Mercedes and BMW. Tata Sons owns 31% of Tata Steel, 20% of Tata Teleservices and 22% of Tata Tea.”
  

Hidden Brain Gains

Recently our Chacha PM said:

• “More than the resources, however, we will require imagination and innovation to succeed. People of Indian origin worldwide can contribute mightily to this effort. In the past few years we have already experienced what has been called a “reverse brain-drain”. I would prefer to call this “brain gain” or, indeed, a meeting of minds.”

Swaminathan S Anklesaria Aiyar wrote recently:

• “Three Indian Americans (Khurana, Chandrashekhar and Ramakrishnan) have won Nobel Prizes in the sciences. Indians are prominent in academia (Jagdish Bhagwati, Avinash Dixit); in management ( C K Prahlad, Pankaj Ghemawat); in business (Indra Nooyi, Amar Bose, Vinod Khosla); and medicine (Sanjay Gupta of CNN, Deepak Chopra).
• One-third of Silicon Valley engineers are Indian. Wall Street is replete with Indians. The big Wall Street scandal today is the insider trading case involving the Galleon Fund. The New York prosecutor is Preet Bharara, the accused is Rajaratnam, and the chief witness is Roomy Khan. You could be forgiven for thinking this was a Dalal Street scandal.
• Indian Americans are rising fast in politics. Bobby Jindal is a potential future US president. Wikipedia lists 40 Indian Americans in US politics today.”