Posts Tagged ‘socialism’

Pit Stop – The Truckers Strike

In India on January 11, 2009 at 1:54 am

As a general rule, frequent and long running strikes are a symptom of an irrationality in society that cannot be resolved through the moral and legal framework.  The only useful, long term benefit of a strike is if it manages to bring problems to the surface and leads in some way to a permanent solution.

Other than this, a strike does not serve long term interests, even of the strikers.  Gains today have to be paid for tomorrow.  Heavy handed action to prevent or resolve strikes will only serve to make the problem worse.

The heavily unionized American car industry might have learnt this lesson had it not been reconsigned to ignorance by the recent bailout.  In India, a valuable lesson will not be learnt because the National Security Act and the Essential Services Act have been used to end the trucking strike.

The lesson that could have been learnt is that the only way pricing of products can be fair if it is determined by market supply and demand and not by government officials or politicians.  The present system of subsidies only robs Peter to pay Paul and is fair to neither.  Peter is deprived of the enjoyment his money can bring and Paul becomes a parasite.

But now this lesson will not be learnt and such strikes and civil unrest will continue to plague India for times to come.

To The Able

In The Good on October 6, 2008 at 3:13 am

Living in India the past two years I’ve made it a point to read Swaminathan Aiyar’s column in The Times of India every Sunday.  In the same period I’ve also discovered a blog called “Aristotle the Geek.”  Today I have a nit to pick with both.

In his blog ATG writes that capitalism works on trickle-up, not trickle down.  In precise terms, capitalism sees neither “trickle up” nor “trickle up” but trickle to ability and efficiency.

Considering again the case Mr. Aiyar presented in his column, it is possible to see without much ado that profit flowed to people in proportion to the value they added to the raw cotton.  The person who makes the cotton most useful to the person who will use the cotton (i.e. the one who uses the most complex ideas) gains the most.

Consider also what happens to the money once it is in the hands of the mill owners.  They do not keep the money sitting like a stone on the ground.  This money finds itself in the market to be lent to the borrower who can make the most productive use of it.  Once again, it goes to the most able, productive and intelligent.

In the thinking of this blogger, both trickle-up and trickle-down are incorrect theories because they miss the essential, the ethical, part of Capitalism – capital flows to those who most deserve it.  All of Socialism is merely a misguided attempt to deny that Capitalism is a based ultimately on justice.