Wednesday, June 21, 2006

The free market economics of "justice"

I've read enough free market 101 books to understand and appreciate its (free markets') philosophy and do lean towards a liberal view that the government is responsible for maintaining an atmosphere condusive to engaging in trade, one can consider this atmosphere as consequence of maintaining law and order. I have a few misgivings, unlike true free market liberals, of the morality of totally free markets and their apparent self correcting nature. I do believe that the government, as part of its responsibility in maintaining law and order, ought to protect the interests of the minorities without, I repeat for emphsasis, without getting regulatory in nature. Though the government represents the majority, the rights and interests of the minority have to be protected keeping in mind that policies framed by the majority can be very well done at the expense of minorities. Just because the majority wants it doesn't make it right. Though I have used the example of policy framing in order to make a point, the analogy can be easily extended to protecting (without getting protectionist) minorities (economically speaking) in a free market that potentially could get immoral. This fine line within which a government must confine itself is transgressed so often that it doesnt exist anymore, much like the case of many a socialist Indian government. It is when the government's policy becomes regulatory and when the markets march to the beat set by the government that everything starts to fall apart. There has been so much said about the detrimental nature of socialist indian policies that nothing I say can add any fresh perspective nor can I say it any better.

Yazad Jal presents us with a free market look at how justice will prevail in a true free market.[Link] The central idea of this post comes from the ideas proposed in "The Market For Liberty" by Linda and Morris Tannehill. The authors being true libertarians re-think the role of government in a revoultionary way and in the book, deal with "private arbitration agencies in managing with disputes and criminality, the role of insurers in providing profitable incentives for security, and private agencies in their capacity as protection services." [book review]

Though I tend to be liberal, being a total libertarian and actually believe heart and soul in the spirit of the said post is a little hard for me. Maybe reading the book and thinking of counter arguments will give me a better perspective and a convert I may become. Time (and the markets) will tell.

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