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I think that this and other articles confuse Socialism with Bureaucracy. Libertarianism as implemented in North America is not exactly the shining pinnacle of economic efficiency.

Just try starting a telephone company in the US or (even worse) Canada. It can take a year or more to get the blessing of our own Permit Rajs at the FCC, PUC, and PTTs (or, in the decidedly more socialist leaning Canada, Industry Canada and the CRTC).

Yet, despite all of this intense regulation and paper pushing, as well as regulatory scrutiny by the FTC, SEC, and IRS, the executives of Telecom Companies have managed to bilk the investment community for what looks to be tens of billions of dollars. They finished their routine with the a quadruple lutz — laying off hundreds of thousands of workers when it all came crashing down.

So.. tell me again.. how are we better off?

For the bulk of this article you can keyword search-and-replace “India” with “America”, “Socialism” with “Capitalism”, and the same statements would arguably be true. Simply because the Wall Street Journal endorses one imperfect social structure over another does not mean that that structure will work as well and as fairly in places outside the US.

When the Union was founded in 1776, America was already well-established as a nation being built by and for the privileged class. As such it had tremendous advantages in terms of resources, and disadvantages in terms of population sparseness, that is unique to history. American Democratic Society was designed to address that, and it did it pretty well in terms of growth.

But presently it seems to have outgrown that ideology. The ever-widening gulf between rich and poor, the exploitation of economics by white-collar thieves, and the sorry state of health care, infant mortality, pollution, an unhealthy population, and other problems are becoming real thorns in the side of America’s sustained growth.


Begin forwarded message:

> From: “R. A. Hettinga”
> Date: Tue Aug 20, 2002 10:55:32 AM US/Pacific
> To: Digital Bearer Settlement List , fork [at] xent [dot] com
> Subject: The Curse of India’s Socialism
> The Wall Street Journal
> August 20, 2002
> The Curse of India’s Socialism
> In a classic case of deflecting blame for their own shortcomings,
> politicians in India have identified the size of the population as the
> country’s biggest problem. This position was stated in a unanimous
> parliamentary resolution passed on the 50th anniversary of
> independence.
> Half a decade later, it is a belief that still resonates with
> many. Yet it
> is hard to imagine a more cynical view. If left free from the extensive
> interference of various levels of government, the energy and
> creativity of
> the Indian people could soon allow them to be among the richest on
> earth.
> Indians are not poor because there are too many of them; they are poor
> because there are too many regulations and too much government
> intervention
> — even today, a decade after reforms were begun. India’s greatest
> problems
> arise from a political culture guided by socialist instincts on the one
> hand and an imbedded legal obligation on the other hand.
> While India’s political culture reflects the beliefs of its founding
> fathers, there is the additional matter of the modified preamble to its
> constitution that specifies: “India is a sovereign, secular, socialist
> republic.” It was Indira Gandhi who had the words “socialist” and
> “secular”
> added in the late 1970s. At the same time, she also amended the
> relevant
> section in the Representation of Peoples Act to require that all
> recognized
> and registered parties swear by this preamble. Since all parties
> must stand
> for socialism, no party espouses classical liberalism (yet there are
> numerous communist parties).
> While one can appreciate the difficulty of abandoning ideas with such
> honored lineage, the fact that socialism has been widely
> discredited and
> abandoned in most places should prompt Indians to reconsider this
> commitment. Despite evidence of its failure as an economic system,
> many of
> the socialists who carry on do so by trying to proclaim that their
> dogma
> reinforces certain civic virtues. A presumed merit of socialism is
> that it
> aims to nurture a greater sense of collective identity by
> suppressing the
> narrow self-interest of individuals. However, this aspect of
> socialism lies
> at the heart of its failure both as a political tool as well as
> the basis
> for economic policy.
> Let’s start with the economic failures of socialism. Most of the grand
> experiments have been ignominiously abandoned or recast in
> tortured terms
> such as the “Third Way” that defer to the importance of markets and
> individual incentives. Unfortunately, it took a great deal of human
> suffering before socialists abandoned their goal of trying to create an
> economic system on the basis of collective goals.
> Socialist ideologues are impervious to evidence that their system
> inspires
> even more human misery in the civic realm. This is because socialism
> provides the political mechanism for and legitimacy by which people
> identify as members of groups. While it may suit the socialist
> agenda to
> create them-and-us scenarios relating to workers and capitalists or
> peasants and urban dwellers, this logic is readily converted to
> other types
> of divisions.
> In the case of India, competition for power has increasingly become
> identified with religiosity or ethnicity, as is evident by the
> rise of the
> Bharatiya Janata Party, supported by radical Hindutva supporters. As
> elsewhere, political parties based on religion are by their very nature
> exclusionary. These narrow concepts of identity work against nation
> building since such a politics forces arrangements that cannot
> accommodate
> notions of universal values.
> Socialism also sets the stage for populist promises of taking from one
> group to support another. This variety of political posturing by the
> Congress Party was used to build a coalition of disaffected
> minorities. In
> turn, the BJP built its power base on a promise to restore power
> to Hindus.
> And so it is that India’s heritage of socialist ideology provided the
> beginnings of a political culture that evolved into sectarian
> populism that
> has wrought cycles of communal violence. Populism with its
> solicitations of
> political patronage, whether based upon nationalism or some other
> ploy, is
> also open to the sort of rampant corruption so evident in India.
> At issue in India is nothing less than the role of the state.
> Should it be
> used as a mechanism to protect the freedom and rights of
> individuals? Or
> should the state be a vehicle for groups to gain power? It should
> be clear
> the latter approach would lead to the destruction of India’s democracy
> while the former will allow it to survive.
> It is undeniable that India’s public policy guided by socialism has
> promoted divisions that contributed to social instability and economic
> destruction. This dangerous game has only served the narrow
> interests of
> those who seek to capture or preserve power. That India is a
> “socialist”
> state, specified in a preamble to the constitution, makes this binding
> commitment evident in the nature of interventionist policies that have
> wrought slower economic growth causing great harm to the poor and
> unskilled
> who have lost access to economic opportunities. Socialism also
> introduced
> forces that are destroying India’s hard-earned democracy. A
> paradigm shift
> in the nature of Indian politics is needed so the state ceases
> serving as a
> mechanism for groups to gain power and instead becomes an instrument to
> secure rights and freedoms for individuals.
> Mr. Lingle is professor of economics at Universidad Francisco
> Marroquin in
> Guatemala, and global strategist for
> —