Debatable.
That’s the word that comes into ones mind after reading Lawrence W. Reeds’ “Seven Principles of Sound Public Policy”. Skim through it and you might call it gibberish, like I did. Give it a thorough reading and you’ll realize that the extremity of his views is somewhat moderated by the logic in what he says.
I find many of his remarks, well, remarkable biased in favor of free markets and economics thereof. Their primary premise being the superiority of Market economies over welfare states, he proclaims this assumption to be a ‘settled truth’ among the intelligentsia.
Some of his principles actually make a lot of sense, such as the ones which emphasize the consideration of long terms impacts and policy effect on incentives while the formulation of any public policy. Whereas, at some points, his views simply fall short of convincing.
His first principle is attractively titled ‘Free people are not equal, equal people are not free’. The word ‘ Free’ and ‘Equal’ having serious economic interpretations only. Therein, Reeds makes an unfair compromise between social and economic equality. He says that in free markets, the economic outcomes are different for different people as they represent their individuality and free markets should be left at their own devices. He consider these economic disparities to be benign but obvious consequences of market dynamics and are emblematic of the different virtues, choices, abilities and talents of the people. He insists that unequal people should not be equalized.
He goes on to credit the failure of any welfare state ( He uses the example of the Soviet Union ) to the differential treatment meted to public and private property. He says that Common property falls into derelictions and disuses whereas Private property is much coveted and well taken care of. His perspective towards socialism is summed up in this witticism and I quote:
‘While socialists are fond of explaining that’s you have to break some eggs in order to make an omelet, they never make any omelets, they only break eggs.’
Agreed, Welfare states have invariably been socio-economic nightmares, but to say that free markets are all peaches and cream, would be gross over exaggeration. Beyond a point, its just not possible to justify the widening economic disparities and concentration of economic power in the hands of the elite few by saying that individual abilities and talents are the sole determinants of economics. Just because people are not equal, does not imply that they have to suffer a raw deal for no fault of their own. It were life scenarios like these that lead to the emergence of Marxist theories and the social revolutions that followed. When any society reaches a stage where there are only 2 classes, the rich and the poor, one realizes the lethal impact of uncontrolled markets. A contemporary example is that of life saving drugs, most AIDS/Cancer medicines are exorbitantly expensive. Is it not unfair then to not let governments intervene and let these essentialities reach the people who need them? Or are we too elitist to believe that poor people don’t have a right to live?
Reeds says that governments are spendthrift, callous, corrupt and costly. He believe that a free and independent people do not require governments for their sustenance, but someone should tell Mr. Reed, that an economically oppressed and dependant people do. Perhaps this statement is a misfit in Contemporary Indian politics, but then I assume governments to be welfare oriented, not just bureaucracy.
Please cease from thinking that I am a left agent or supporter of sorts. I am all for the free markets and minimization of deadweight losses caused by government policies. But to believe that pure free markets are THE solution, does not go down too well with me.
No society can exist in extremes, Socialism collapses. Free markets might not, but they are like a boiling pot of economic frustration, which lead to eventual implosion.
Ketan Kapoor.
PS: Looking forward to working with intelligent and bright people like you all. The very best.
Au Revoir
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1 comment:
Having read and reviewed the same essay, I found myself sharing similar sentiments as you, however I'm yet to see any logic in the essay. I found it to be absolute hogwash - only meant to fool the gullible. I'm quite pro-libertarian and a staunch supporter of right-wing economic and socio-economic policies, myself, but was quite repulsed by the gross way Reed chose to almost 'market' his idea. The entire essay was nothing but fancy wordplay, with catchy "principles", which although appealed to common sense, had explanations which were far from it. I found most of his principles to be either a) quite irrational, or b) redundant.
For example, in the first principle, he simply chooses to ignore the socio-economic aspect of the concept of equality, and the equality of opportunity, as opposed to the strict monetary equality he considers. Moreover, in the fifth principle, he conveniently discusses the political and bureaucratic fallacies of the government, contrary to his strict 'economic' approach. An unfair comparison, I feel. Also, he chooses to argue against governments empirically, by providing real life examples of their failures, however, does not provide any examples of, or even consider the possibility of error in his idealist free market.
Structurally, Reed would also have done well to club principles 2 & 5 together, which, although rather irrelevant to the formulation of any public policy per se, are essentially the same.
"A free and independent people do not look to government for their sustenance. They see government not as a fountain of “free” goodies but rather as a protector of their liberties, confined to certain minimal functions that revolve around keeping the peace, maximizing everyone’s opportunities, and otherwise leaving us alone."
In the entire essay, the above quoted lines were the only ones which remotely appealed, or made sense, to me. For the first time, Reed, instead of his mindless bashing, decides to pro-actively define the role of the Government, or even acknowledge the reason for existence of one.
I also feel that his 7 "principles" would never be conducive to any developing economy, as they categorically reject any welfare measures by the government, which might not really be required in a broadly developed economy such as the U.S.A, but are essential to any developing economy to attain a holistic growth.
[What I wrote above were random thoughts. Any corrections, or different opinions are welcome. Would have loved to post my entire review, for any feedback, but it's a tad too long.]
Varun Malhotra
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