Thoughts on economics and liberty

Gandhi strongly opposed price controls and would have opposed ALL of Nehru’s agriculture controls

I alluded to Gandhi’s comment re: price controls here

I’m publishing most of his 3 November 1947 speech.

==THE MATTER OF FOOD (PRICE) CONTROL==

[Due to inflation and shortages of food, farmers and traders had been hoarding food and prices had shot up. The Nehru government responded foolishly with price controls. Gandhi objected]

In view of the fact that Dr. Rajendra Prasad has called a meeting of the Premiers or their representatives and others to help and advise him in the matter of food control, I feel that I should devote this evening to that very important question. Nothing that I have heard during these days has moved me from the stand I have taken from the beginning that the control should be entirely removed at the earliest moment possible, certainly not later than six months hence. Not a day passes but letters and wires come to me, some from important persons, declaring emphatically that both the controls should be removed. I propose to omit the other, i. e., cloth control for the time being.

Control gives rise to fraud, suppression of truth, intensification of the black market and to artificial scarcity. Above all it unmans the people and deprives them of initiative, it undoes the teaching of self-help they have been learning for a generation. It makes them spoon-fed. This is a tragedy next only, if indeed not equal, to the fratricide on a vast scale and the insane exchange of population resulting in unnecessary deaths, starvation and want of proper residence and clothing the more poignant for the coming inclement weather. The second is certainly more spectacular. We dare not forget the first because it is not spectacular.

This food control is one of the vicious legacies of the last World War. Control then was probably inevitable because a very large quantity of cereals and other food-stuff were exported outside. This unnatural export was bound to create a man made scarcity and lead to rationing in spite of its many drawbacks. Now there need be no export which we can avoid if we wish to. We would help the starving parts of the world, if we do not expect outside help for India in the way of food. I have seen during my lifetime covering two generations several God sent famines, but have no recollection of an occasion when rationing was even thought of.

Today, thank God, the monsoons have not failed us. There is, therefore, no real scarcity of food. There are enough cereals, pulses and oil-seeds in the villages of India. The artificial control of prices, the growers do not, cannot, understand. They, therefore, refuse willingly to part with their stock at a price much lower than they command in the open market. This naked fact needs no demonstration. It does not require statistics or desk-work civilians buried in their red-tape files to produce elaborate reports and essays to prove that there is scarcity. It is to be hoped that no one will frighten us by trotting out before us the bogey of over-population.

Our ministers are of the people, from the people. Let them not arrogate to themselves greater knowledge than those experienced men who do not happen to occupy ministerial chairs—but who hold the view strongly that the sooner the control is removed the better. A physician writes to say that the food control has made it impossible for those who depend upon rationed food to procure eatable cereals and pulses and therefore, he says, the people needlessly suffer from ailments caused by rotten stuff.

In the place of controlled food, the Government can easily run the very stores for selling good grain which they will buy in the open market. [Sanjeev: this, of course, was a bad idea, but we can perhaps excuse Gandhi’s ignorance of economics] They will thus bring about automatic regulation of prices and set free the hoarded cereals, pulses and oil-seeds. Will they not trust the grain dealers and growers? Democracy will break under the strain of apron strings. It can exist only on trust. If the people die because they will not labour or because they will defraud one another, it will be a welcome deliverance. The rest will then learn not to repeat the sin of being lazy, idle or cruelly selfish.

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Sanjeev Sabhlok

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