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Re: [Re: [Re: [food for thought]]]



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[Topics under debate]: GOOD GOVERNANCE
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Sorry, I could not reply earlier-- too many things to catch up on my end. 

<<
It doesn't lose. In the short run, say, 2-3 years,
until things settle down, there will be readjustment
of wealth distribution. Jobs will be lost but more
jobs will be created. However, there can be no
guarantee that the same people who lost the jobs
will gain new employment. That is the reason any 
country wants to maintain status quo. It requires
courage to open up the economy. Most political parties
are interested in the events that affect the short run,
not the long run.
>> 

Well, we need to be careful when we say that in the short run things would
be unsettled, and the longer term distribution of wealth would result in a
better configuration. This is a very risky assumption to make. How do we
know that there are no other factors which would hamper this process? 

For instance, recently the US vehemently opposed India's bid for buying a
Cray supercomputer. I was just wondering how many Indian scientists were
involved in designing this computer-- who would have added value to India
in the default case-- were it not been for a globalist economy. My
contention is simply this-- a global free market is just a utopic ideal--
far removed from reality. In reality, politics throws in the spanner far
before the economics "settles down" to a real free market. If there were
really a free market, India should have been able to purchase the crays or
cryogenics without any problems.

<<
There is no planning. It is more to regulate the
move towards free trade. Member countries should
fight against any policy based on vested interests.
WTO does not plan. It is an organization to promote
free trade.
IMF gives loans during BOP crises based on certain
conditions. If any country doesn't want to adhere
to these conditions, they do not have to take the
loan. IMF wants to get the money back and their 
suggesions are usually to help the country. In some
cases, they may be wrong but that is more due to
their reading the economy in a wrong way.
>> 

Well what goes on is in effect "planning" on a macro scale. If the WTO
wants it can "plan" sanctions on countries or "plan" to pressurize nations
to adhere to its policies. Isn't the argument that the WTO's actions are
more to "regulate the move towards free trade" very similar to the
socialist argument that the state "regulates" the economy towards
"fairness"?

Before rejecting socialism, we need to first ask why did the euphoria
towards socialism arise in the first place? Socialism seems to be, in
retrospect, arisen as a reaction to impearialism-- which is an extreme
form of capitalism.  We need to be aware of the distinction between the
imperialist forms of capitalism-- which I suspect would be manifested more
when capitalism crosses political boundaries. I would like IPI to also
start a debate on the political fallouts of economic decisions... 

<<
It isn't!
>> 

It is! 

<<
the correct question would be 20 people dying by
rioting or 100 people dying by rioting and 100
others living a life starving every 2 days. 20 people
dying by rioting seems preferable.
>> 

And this is exactly what I was afraid of-- when the student was asked to
write an essay on the cow, he first tied the cow to the tree and wrote
about the tree! But seriously-- something similar is happening in India
too-- what is called "solution-probleming"! Where problems are modified to
suit the available solutions, rather than trying to meet actual demands.
The other day I saw an article in India today which in effect said
somethings of this sort-- "...the Indian consumer seems to display a
marked lack of security and hence chooses to save rather than spend... and
that is why forecasted demands are not seen... but it can be set right by
using innovative means to create demands for these goods..." (something of
that sort-- I don't have the URL now, as I am writing from a public
terminal-- but I'll send it later). It was incredulous! If the Indian
consumer shows a clear demand for more security, so that (s)he could spend
more then should we not be addressing the market along the security aspect
rather than "innovative" ways to create new demand??? By opening up, we
would be more prone to such solution-probleming, and the actual problem
keeps growing since it would be unattended. It is simple systems-dynamics.
In my question I never mentioned a disparity in numbers-- so where did the
100 come from??

No, I am far from convinced about this "global free market". Global free
market is a utopic myth, and we had better not wait for this "age of
freedom"  to come by one fine day and deliver us from all our ills. The
world is not bivalent-- if socialism has failed it does not mean
capitalism would succeed.  Why are we averse to research this aspect, and
ask fundamental questions without being swayed by either socialism or
capitalism? We are in immediate need of such research now. As far as I
know there has never been a situation like today anywhere in the past
history of economics, where trading may be made global in a matter of
seconds and the emergence of "global" technologies like internet. But does
it actually make the market itself "global"? I am not sure.

Best, 
Srinath 



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