Buck back to us

Mr.Nitin Pai has very interesting column in DNA wherein he writes: 

• The earliest Indian traditions view the role of the State as protecting its citizens from the predatory world of matsya-nyaya, the law of the fishes, where the strong prevail over the weak. The state, through the establishment of danda niti, the rule of law, ensures that the rights and freedoms of the individual are protected. Citizens surrender a part of their freedoms to the State, so that it may ensure that they can enjoy the rest. This deal is the fundamental premise in the world’s constitutions, including our own. In other words, we citizens have appointed the State as our security guard. It is absurd for the security guard to outsource the job back to us, for then, why do we need the security guard in the first place?

Count that ‘GOLD’ back!

Economist S.S. Tarapore writes: 

• A reserve currency which is not linked to gold necessarily has to become weak. For the next 40 years international monetary pundits felt that somehow the system of a reserve currency would remain stable through so-called international monetary co-operation. Economist Wilhelm Röpke, 60 years ago, said that the more countries talk about international co-operation, the less countries co-operate with one another! 

• The Washington D.C. based American Principles Project (APP), on the Gold Standard 2012, is an attempt to reach out to lawmakers to advance legislation to put the US back on to a gold standard. The APP has recently prepared a White Paper on the “Use of gold as the primary reserve asset by international central banks” by Ralph Benko, Charles Kadlec, Richard Danker and Nick Arnold (December 2010).

See his earlier article on "Hayekian approach: Lasting relevance for India"

F A Hayek’s double cheers!!

1. Hayekian Courage
2. The Economics of Abundance by F A Hayek

Leave that LEFT!

Raghuram Rajan & Brian Barry says: 

• “Many on the left nowadays seem especially confused about the advantages of competition, and many progressives’ approach to education is an excellent example of this.” 

On the similar tone Surjit Bhalla said: 

• Hints of this forthcoming doom are contained in the Communist manifesto, sorry, the CPM Election Manifesto for the 2011 state elections. Of the three main objectives stated in the manifesto, number one is the following, and it bears quotation in full: “Our main objective is to improve (the) living standard of families below the poverty line and to create opportunities of employment” (emphasis added). Further, if the poor are the base of support for the CPM, then they have lots to worry about. By their own admission, poverty is down to only 20-odd per cent according to the old official poverty line. Which means there are less and less supporters for those whose only slogan is “for the benefit of the poor”. This is a key point and suggests that the CPM has been caught in a time warp of its own making. 

• The manifesto starts off with how capitalism is dying under the burden of the great 2008 recession — remember, we are in 2011, but never fear. These are the opening lines: “The... election is being held against the backdrop of an unprecedented worldwide economic crisis... the hegemonistic western capitalist countries led by US imperialists have been shifting the onus of the crisis onto the Indian people.”

Note that cult-IN-flation

“The simple premise of the quantity theory of money is that for a given velocity of money, the higher the growth rate of money supply relative to the real gross domestic product (GDP) growth rate, the higher the inflation rate. In this framework, ensuring that monetary aggregates stay within an estimated equilibrium growth rate is key to controlling inflation. But estimating this target growth rate depends on the predictability of the demand for money, which in turn depends on the stability of velocity.”

Come SHALA!!

There is a good news!! Brief write up about SHALA has been published in the 14th Livemint "Loung Loves" as "Outside the classroom".

• In scheduled sessions, Takshashila fellows—Pai himself is a fellow of geopolitics—will share their research. Speakers will include government officials such as Navdeep Suri, joint secretary, public diplomacy, ministry of external affairs; and topics such as “India as a swing power” (Pai) and “B.R. Ambedkar as a champion of free markets” (B.Chandrasekaran, Hayekorder.blogspot.com).

Vulnerable Statism and Marxism

Mr.Venu writes: 

• “The housing minister of West Bengal, Gautam Deb, told some journalists just before the concluding phase of the state elections that the Marxists managed to stay in power for 34 years because the heightened political consciousness of the Bengalis made them immune to material needs. This was virtually turning Karl Marx on his head, whose entire treatise is based on the premise that materialism is the strongest social force in history!”

Does left have any new idea?

A Professor says:

“……. the Left seemed to have run out of ideas or at least lost its enthusiasm for pushing new ones.”

B.R. Ambedkar, the Republican!!

Mr.Chandrabhan Prasad writes: 

• It was at this point that Dr Ambedkar wrote in his manifesto of 1951: “It is a fact that on the day of India’s Independence, all nations were the friends of India...Today, the situation is just the reverse. India has no friends…The change in the situation is the direct result of the foreign policy that our country has followed. Wanting China to be a part of the UN and taking a stand on the Korean War — why should India want to fight China’s battle. This championing the cause of Communist China by India has been responsible for the prevailing antagonism between India and the US. It has become impossible for India to obtain financial and technical aid from America.” (Pg 395-396, Vol. 17, Part One)

• Dr Ambedkar realised the importance of having the US as a friend 60 years ago. Something that our leaders are thinking of doing today.

• Dr Ambedkar was so inclined towards the US in 1946, that at one point of time he had wanted India to be named United States of India after Independence. He also named his party — Republican Party of India, inspired by SSA’s Republican Party. But, why was Dr Ambedkar so enamoured the US?

Francis Fukuyama and Libyan dictator Moammar Khadafy

 From Hayek’s Letter to Editor. 

• …swipe at Glenn Beck as not a very serious thinker, without any specific examples. Beck has been wonderful for my book sales, so I admit I have an interest here, but I'd take Mr. Beck's thought over what the New York Times passes off as serious thinking any day. If the Times is going to go ad hominem, I can, too — the reviewer your book review hired, Francis Fukuyama, reportedly consulted to Libyan dictator Moammar Khadafy, a fact the Times bizarrely omitted in a recent long and flattering profile of Mr. Fukuyama. If there were ever an example of the dangers of big government, Colonel Khadafy personifies it, and your reviewer's apparent blindness to that raises questions about his judgment and critical thinking skills.

The Beast G, back Ahead

Some excerpts from a review article by Francis Fukuyama on new edition of F A Hayek's 1960s book The Constitution of Liberty. The current President of Mont Pelerin Society is Prof.Kenneth Minogue. He said to me (during the February's MPS Asia Regional Meeting which I attended) that this book is Prof.Minogue's favourate and the best among Hayek's books!! 

• In an age when many on the right are worried that the Obama administration’s reform of health care is leading us toward socialism, Hayek’s warnings from the mid-20th century about society’s slide toward despotism, and his principled defense of a minimal state, have found strong political resonance. 

• Unlike Beck, Hayek was a very serious thinker, and it would be too bad if the current association between the two led us to dismiss his thought. Hayek always had problems getting the respect he deserved; even when he was awarded the Nobel in economic science in 1974, the awards committee paired him with the left-leaning economist Gunnar Myrdal. With the passage of time, however, many of the ideas expressed in “The Constitution of Liberty” have become broadly accepted by economists — e.g., that labor unions create a privileged labor sector at the expense of the nonunionized; that rent control reduces the supply of housing; or that agricultural subsidies lower the general welfare and create a bonanza for politicians. His view that ambitious ­government-sponsored programs often produce unintended consequences served as an intellectual underpinning of the Reagan-Thatcher revolution of the 1980s and ’90s. Now that the aspirations of that revolution are being revived by Tea Partiers and other conservatives, it is useful to review some of the intellectual foundations on which it rested.

• Hayek’s skepticism about the effects of “big government” are rooted in an epistemological observation summarized in a 1945 article called “The Uses of Knowledge in Society.” There he argued that most of the knowledge in a modern economy was local in nature, and hence unavailable to central planners. The brilliance of a market economy was that it allocated resources through the decentralized decisions of a myriad of buyers and sellers who interacted on the basis of their own particular knowledge. The market was a form of “spontaneous order,” which was far superior to planned societies based on the hubris of Cartesian rationalism. He and his fellow Austrian Ludwig von Mises used this argument against Joseph Schumpeter in a famous debate in the 1930s and ’40s over whether socialism or capitalism offered a more efficient economic system. In hindsight, Hayek clearly emerged the winner.

Walk with that cult!!!

Gandhi was sympathetic to the idea of nationalism, as a way to assert a wounded culture’s identity. Tagore liked to celebrate the identity, but remained worried that nationalism would lead to divisions and boundaries.

Choice in India

Some excerpts from this article

"Research in India, however, reveals that choice has neither the same positive consequences for individuals, nor the same negative consequences for society. For example, research by Ritu Tripathi at the Indian Institute of Management, Bangalore, and Daniel Cervone at the University of Illinois at Chicago examined whether choice motivates Indians to work on a task. They found that Indian corporate professionals were willing to volunteer as much as 25 minutes for an unpaid online task when they were directed to volunteer as much time as possible, but only 5 minutes when they were asked to choose how much time they wanted to volunteer. The researchers argue that performing one’s duties and meeting obligations is more energizing for Indians than focusing on personal choice."

If the similar survey is done in the government, the conclusion will be opposite!!!

"In India, in contrast to the US, individuality, independence, and personal self-expression have not been historically significant concerns. Instead, Joan Miller, a psychologist at the New School of Social Research, has shown that many Indians are more concerned about meeting their responsibilities and obligations to other people than in expressing themselves through unique choices." 

My Talk in Chennai on May 14th, 2011!!!

Here (sorry its in Tamil!!!) is a link to the announcement for my talk in Chennai on May 14th, 2011. I will be presenting based on my paper presented in the Mises Institute's Austrian Scholars Conference 2011 in March and subsequently published a article in the Pragati's April Issue (PDF). This is the first time I will be engaged in talk in Chennai!! I am looking forward the talk!! If any one or whose friend is interested in attending, please do come!!

Many thanks to Mr.Satya for the arrangement!!

Some good news links

The Pragati’s May Issue is out now. You can find PDF here.

Don’t forget to read the piece on “Jan Lok Pal: unconstitutional, unnecessary” by Amba.

The Centre for Civil Society has announced “Colloquium on Property Rights: Law, Liberty & Livelihood”