Read my article “The Human Cost Of Zoning” on FEE.org. I hope zoning in the third-world gets more attention with essays like this. I am glad that Financial Times, Tyler Cowen, Alex Tabarrok, ACI Scholarly Blog Index, Orange County Register, Urbanomics and economist Ajay Shah blogged about this article. Quartz shared it, and NYU Stern School Of Business’ Urbanization Project, Marron Institute, and Brandon Fuller tweeted it. Continue reading “The Human Cost of Zoning in Indian Cities”
Farming is considered a patriotic enterprise, and nearly half of India’s labor force is engaged in agriculture and allied activities. Almost everyone believes that in the election season, political parties should pledge to aid this patriotic endeavor to feed the nation.
After the Indian independence, the annual production of agricultural goods has risen many folds. At the same time, the prices of agricultural products have risen many folds too. In surveys, inflation is on the top of the list of the scourges that anger the Indian voters. Except for a short period in the early 2000s, inflation in independent India has always been high. How could agricultural productivity and prices rise simultaneously, year after year? It is surprising that such obvious questions have not occurred to the policy analysts who take such claims at face value. The prices rise when there is more money chasing fewer goods. Remember that even in 2008, when the then President Bush complained about rising global food prices, the average inflation in the United States was only 3.8 percentage. This was the highest in that decade. If this were fueled by the global economic crisis, it would have affected other countries too. But, in the countries were central banks are independent and have an inflation target, the inflation rates were often ridiculously low. India would not have found an inflation of 3.8 percentage worth losing sleep over. In its history, India has almost never seen such low levels of inflation.
But, if so many people produce so little as they claim, perhaps not many people should engage in farming. A short evening on a farm might have convinced the panegyrists of the past that the farmers themselves might not agree with their romantic view of the farmer.
“My mind,” he said, “rebels at stagnation. Give me problems, give me work, give me the most abstruse cryptograms, or the most intricate analysis, and I am in my own proper atmosphere.”
He is not a man that it is easy to draw out, though he can be communicative enough when the fancy strikes him.
He was quiet in his ways, and his habits were regular.
He has the tidiest and most orderly brain, with the greatest capacity for storing facts, of any man living.
Holmes could talk exceedingly well when he chose, and that night he did choose. He appeared to be in a state of nervous exaltation. I have never known him so brilliant. He spoke on a quick succession of subjects—on miracle plays, on medieval pottery, on Stradivarius violins, on the Buddhism of Ceylon, and on the warships of the future—handling each as though he had made a special study of it.
“I was never a very sociable fellow, Watson, always rather fond of moping in my rooms and working out my own little methods of thought, so that I never mixed much with the men of my year.”
Sherlock Holmes had, in a very remarkable degree, the power of detaching his mind at will. For two hours the strange business in which we had been involved appeared to be forgotten, and he was entirely absorbed in the pictures of the modern Belgian masters. He would talk of nothing but art . . .
“He sits motionless, like a spider in the centre of its web, but that web has a thousand radiations, and he knows well every quiver of them”
“All that I have to say has already crossed your mind.”-Moriarty to Sherlock Holmes
“Doyle and Holmes were both tall and physically strong, both loved boxing and Turkish baths, were both untidy, both had a horror of destroying documents, both were omnivorous readers, and both favored the political union of England and the United States. Both were deeply interested in heredity, ancient manuscripts, and the Cornish language. Pierre Nordon describes Holmes as one of the last defenders of chivalry in English-language literature and most of all as an advocate of the innocent and victims; that is how Doyle saw himself, given the many public campaigns he fought, such as that against colonial Belgian oppression in the Congo. The point is not that Doyle and Holmes were similar in every way but rather that Doyle was well aware of how closely he was tied to his most beloved character. It’s also worth noting that none of Doyle’s other works succeeded in producing any memorable characters at all, perhaps because he had used up the main source material he had, namely himself.”
The quotes are from Tyler Cowen’s Create Your Own Economy
The root cause of most social ills is not that people are not activists or poverty-eradication thinkers. These are character flaws, and weak character is never in short supply. I am perhaps the first person to make this claim, but even “eminent” Indian intellectuals are not capable of making rapid fire abstract associations. By this, I mean the power to think quickly, to build arguments and counter-arguments, to spot non sequiturs, and to instantly pick holes in the arguments of their opponents. This is a major cause of social evils.
Look at the Sen-Bhagwati debate. A key position of Amartya Sen is that “There isn’t a single place where growth has taken off without an educated and healthy workforce.”
Is it true that Indian poverty and weak economic progress is largely a result of a physically weak and uneducated workforce? The assumption is that Indian workers earn less because they are capable of exerting less physical and mental effort. Now, don’t deny this. Taken seriously, this is what this claim implies.
If this is true, transporting them to a different country, keeping their education level and health constant won’t improve their productivity and income levels significantly. But, we know that a low skilled Indian worker who moves to the US might see his income instantly rising twenty fold. In a prosperous country, they will live longer and healthier, being incomparably more productive. This means that there are cheaper and quicker ways of raising their income and productivity than building huge schools and hospitals, and hoping that growth will take off in a generation or two. This also means that the problems lie elsewhere. Continue reading “The Power Of Abstract Thinking”
As usual, inflation targeting began in the United States. In 1971, the US cut the link between the dollar and the Gold. Soon other countries followed suit. Inflation started rising to unprecedented levels in the US and the other industrial nations. Like in today’s India, the inflation of the 70’s was blamed on the rising oil prices, and various external factors. Like in today’s India, many economists had believed that with rising inflation unemployment would fall. Low growth was also associated with high inflation. But, in the 70s, with high inflation, growth fell and unemployment rose.
In 1979, the Fed decided to have monthly target rates for the growth rate of M1. (M1 consists of the public’s holdings of currency and the checking account deposits in banks and other depository institutions) In 1971-81 period, the inflation in the US was in double digits, but, something changed after that.For close to three decades, inflation in the US was steady, but historically low. Fluctuations were mild till the ongoing global slow down. This is historically unprecedented. In the 70’s and 80’s, inflation in New Zealand was higher than in other OECD countries. In 1988, the CPI inflation in New Zealand was 9%. Inflation targeting began in 1990, and by 1991, the inflation was down to 2%. Inflation and output volatility declined. By 1994, New Zealand was among the fastest growing OECD countries. In the financial year 2012-13, prices fell in New Zealand, month after month. It was so remarkably successful.
“India was relatively unhurt in the global financial crisis. The developed countries have a lot to learn from our highly regulated financial system.”
This is a popular claim. And this is, of course, nonsense.
I also suspect that this is an extension of the philosophy of the people who are not-so-intelligent (Right wing people) by the people of so-called intelligence (Leftist people).
I recently read Ila Patnaik’s response to this claim:
“India is a very poor country. We know very little about how to establish institutions or regulate markets that can support a sophisticated economy where a billion people can enjoy high productivity. Nobody in the world wants Indian-style monetary or financial policy-making. Our path ahead lies in learning how fiscal, financial and monetary institutions work in countries where per capita GDP is many times bigger than what we have in India. Our hope for making progress lies in learning these things with an open mind, and demanding a pace of change in India so that we can become more like an OECD country. A villager with no roads may foolishly boast of having no accidents, but he cannot teach people how to regulate traffic on busy intersections. It is important for policy-makers to remember that India has no lessons to offer to regulators operating in the sophisticated world of finance, and proposals suggesting that they should learn our style of regulation only make us look foolish.” Continue reading “Feel-Good Wisdom: No One Like Us”
Revenge has always had a bad press in a world where conformists are actively scheming to make a virtue out of a vice. But, it is not hard to see that deep down, they love what they claim to despise.
Crowds throng to the theaters to watch movies in which the hero stands victorious at the end, blood and sweat running down his chest. When S.P.S. Rathore got away with a measly fine and six months imprisonment after molesting a girl, ruining her family and driving her to suicide, Sagarika Ghose tweeted: “My daughter is almost 14. If I was Ruchika’s mother, I would have gone and broken Rathore’s jaw.”Above a picture in which Rathore was grinning widely saying “I am relieved today”, Sandipan Deb wrote: “Remember that face.” Revenge sells in a market where people consume what gives them joy, and not what is supposed to give them joy. The tycoons of the entertainment industry know it. Our journalists know it. Continue reading “Kasab’s Hanging: Revenge And Closure”
The news culture has long disappointed many of us who have always wanted to be writers. As things stand, journalistic writing has little artistic value. The journalistic pieces of an H.L. Mencken, Ambrose Bierce, Frederic Bastiat are “indisputably the most underrated kind of literature”, but the hot topics of the day are of little historical importance. The importance of news is all but a mass delusion. It is far more sensible to rely on the work of an eminent historian than on a reporter’s rush job. Things can wait. It is ridiculous to elevate journalism into a superior form of analysis or literature, when very few journalists in the whole of human history can be considered guilty of building rigorous systems of thought.
I tend to agree with Times of India’s new advertisement, though not necessarily in a literal sense: “Information is not knowledge. Knowledge is not wisdom.” Rolf Dobelli is probably right: “I don’t know a single truly creative mind who is a news junkie – not a writer, not a composer, mathematician, physician, scientist, musician, designer, architect or painter. On the other hand, I know a whole bunch of viciously uncreative minds who consume news like drugs.” Continue reading “The Menace Of Bleeding-Heart Journalism”
When I see condemnation of the journalistic standards of “The Times of India” filling my newsfeed, a question posed by Gail Wynand whose media empire spread like bubonic plague comes back to me: “Do you think it took no talent to create the Banner?” Gail Wynand, the publisher of the New York Banner owned twenty-two newspapers, seven magazines, three news services and two newsreels. He burnt prodigious energy and will power to achieve perfection in serving every perverse need of his ultimate boss-the imbecile on the street who consumes news, gossip and lurid stories like drugs. It took spectacular talent for Wynand to achieve extraordinary perfection in the ordinary.
One of the most powerful scenes in “The Fountainhead” is when several newspapers cornered Gail Wynand, the publisher of New York Banner, to censure him for debasing public tastes. Gail Wynand replied, smiling: “You give them what they profess to like in public. I give them what they really like. It is not my function, to help people preserve a self-respect they haven’t got. Honesty is the best policy, gentlemen, though not quite in the sense you were taught to believe.”
In the New York Banner’s first public campaign, they appealed to the charitable sentiments of the public by displaying pictures of a pretty girl waiting for her illegitimate child, and a starving scientist side by side. The campaign raised one thousand and seventy-seven dollars for the unwed mother when the young scientist had to be content with nine dollars and forty-five cents. At the end of the campaign, Gail Wynand had decided how the Banner deserves to be run. Continue reading “Rand, Markets and Sadism”
The internet can be amusing. Yet, some of our experiences on the internet can strike us as bizarre. A few days back, I happened to talk to a middle aged woman based in the US. I was in a playful mood. I asked her how “Randroidism” is going on. She suddenly lashed out saying that Objectivism is a complete philosophy and the term I used was derogatory. She suggested that I should soon get myself psychologically treated, proceeding to remove me from her list. I found her behavior immature for a woman of her age, and as I barely knew her, I laughed it off and soon forgot the whole incident.
I never understood people who hold personal grudges against ones who disagree. I have friends who disagree with me on issues in which I can turn really emotional, and I haven’t held this even slightly against them. I am certainly convinced that they are wrong, but I am better off debating a well read, intelligent socialist than an abysmally read libertarian. After all, what is the point in a debate if we agree on everything? Continue reading “The Church Of Randroidism”
It has become the dream of every social democrat to brand himself as a classical liberal. Every such “limited Government” statist is a socialist in disguise, as unaware of it he might be. When he criticizes Central Planning or interventionism, he never really believes his own words. If he does it at all, he doesn’t appreciate it as much as he should. All this is true of Sanjeev Sabhlok-former “Aristocrat of the Bureau” who later found a more comfortable shelter in the Department of Treasury and Finance, Victoria, and is presently nurturing grandiose political ambitions. The emperor of the world’s largest democracy, that is. He even promises to sacrifice his Australian citizenship and return to his motherland if he clearly gets a signal that India badly needs his social engineering. A laudable act of self abnegation, it would be! His viable solution to India’s mis-governance is critically important for our survival and success, he patronizingly reminds us.
Sanjeev Sabhlok’s critique of libertarian anarchy strengthens my position that every statist criticism of anarchy actually projects all the evils of the state on anarchy. I was filled with dismay after a casual glance at his ad hominem attacks on innocent anarchists. We are utopian dreamers with no understanding of social contract, red-tapism or the free rider problem and still spend our time conjuring up imaginative schemes. What’s worse? We haven’t ever drawn up any real contract in our life! Is there any good thing to be said of his article? Yes. Finally, the harsh reality has struck him that anarchists are not simpletons who believe that all human beings are angels. And that is it. Continue reading “The Case For Libertarian Anarchy”