Thoughts on economics and liberty

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Modern economics begins with Hayek, who made the invisible hand visible

Adam Smith identified the invisible hand but had no idea how it works. People like Marx then went off on a complete tangent using the labour theory of value.

Menger, Jevons and Walras demolished the labour theory of value in the 1860s and 1870s. They were getting close enough but still did not understand how the invisible hand works.

It was only through Hayke’s 1945 paper, The Use of Knowledge in Society that we began to see how the invisible hand actually works. Hayek made the invisible hand visible.

Economics should be dated from 1945. Prior to that it was proto-economics – merely the seed of economics. Without understanding information that informs the “invisible hand”, it is not really possible to be an economist.

(Btw, I was the first to publish Hayek’s paper on the internet).

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Modi can’t change the BASIC STRUCTURE of the Constitution

Shashi Tharoor spoke in Lucknow today, pointing out that if Modi is not electorally blocked in 2019, he may well re-write the Constitution and convert India into a Hindu rashtra.

Has Shashi considered that Modi can’t change the BASIC STRUCTURE of the Constitution (Kesavananda Bharati case)? The only way Modi can create a Hindu Rashtra is by repealing the Constitution and taking on full dictatorial powers and dismissing the Supreme Court.

Well, this much I can assure Modi that if he ever does that then India will descend into a civil war the likes of which the world has never seen. India can become Hindu rashtra only over the dead body of millions. India is a much bigger concept than the Hindu religion.

Not only will Modi become a total outcaste across the entire world, India will split into smithereens and revert to 300 countries if the Ambedkar Constitution is destroyed.

In fact, Modi can’t even implement Article 48 of the Constitution the way he wants. The northeastern and southern parts of India will rebel and leave India.

India is not something that will change character just because a fanatic like Modi has come to the helm – temporarily.

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Subhash Chandra Bose’s view about the Indian Liberals

Bose had very strong views in favour of communism and fascism. The liberals did not impress him but he noted their activities for the record in his book.

From Bose’s Indian Struggle, Vol. 1

“The present leaders of the Liberal Party are Sir Tej Bahadur Sapru of Allahabad, Sir Chimanlal Setalvad and Sir Pheroze Sethna of Bombay, the Right Hon. V. Srinivasa Sastri and Sir Sivaswami Iyer of Madras, Mr. Chintamani of Allahabad, and Mr. J. N. Basu of Calcutta. ”

“From the above narrative it might appear as if throughout 1921 Mahatma Gandhi was riding on the crest of a wave and had no obstacles to encounter. This impression is not altogether correct. No doubt there was a tremendous volume of mass opinion on his side — but so far as the intelligentsia were concerned, there were certain elements opposed to him. In the first place, the Indian Liberals were everywhere arrayed against him and in most provinces they had accepted office as Ministers. This co-operation on the part of the Liberals was the direct result of the efforts of Mr. Montagu, the Secretary of State for India, and as long as he remained in office — that is, till March 1922 — they were enthusiastically in support of the Constitution. After his resignation from the British Cabinet, reaction set in and Liberal leaders began to feel that it was becoming increasingly difficult for them to continue their co-operation. In April 1922, Sir Tej Bahadur Sapru resigned from the Executive Council of the Viceroy and in May 1923, Mr. Chintamani, Liberal Leader of the United Provinces, resigned the office of Minister of Education in that province. Gradually the Liberals all turned against the Government and by 1927 the change was so great that when the Simon Commission was appointed, Congressmen and Liberals could preach boycott from the same platform.”


“The public had become so much accustomed to the idea of self-determination for India, that they no longer regarded the British Parliament as the arbiter of India’s destiny. It was therefore but natural that the Congress should, without hesitation or delay, decide to boycott the Commission (popularly known as Simon Commission). That was, of course, no surprise for the Government. But what did surprise them was the decision of the Indian Liberals to boycott the Commission. It was not the violation of the principle of self-determination which offended them but the exclusion of Indians from the All-White Commission. In the face of this non-co-operation on the part of the British Government, how could the Liberals maintain their pet theory of Indo-British collaboration? The attitude of the Liberals was explained by a resolution passed at a public meeting held at Allahabad in December, which was presided over by Sir Tej Bahadur Sapru and which considered ‘the exclusion of Indians a deliberate insult to the people of India, as not only does it definitely assign to them a position of inferiority, but what is worse, it denies them the right to participate in the determination of the constitution of their own country’. The tenth session of the Liberal Federation held at Bombay the same year and presided over by the same gentleman, decided to reject the Simon Commission.”


“on June 7th, 1930, the report of the Commission was issued. The report met with vehement opposition from all quarters, so reactionary were its recommendations. Even the Indian Liberals demanded that the Simon Report should not form the basis of discussion at the Round Table Conference.”



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