Free Market Economy : Curse for Human Society PDF Print E-mail
Economics
Written by Himanshu   

In 1776 Adam Smith came out with his well known book: 'An Enquiry into the Nature and Causes of the Wealth of Nations' popularly referred to as The Wealth of Nations. In this he propounded his famous economic theory of 'invisible hand that naturally guides a society through self interest' which subsequently laid foundation to what we now call: Capitalism. He further defined the value of a product as the aggregate of wages, rent of land and “profit of stock” which compensates the capitalist for risking his resources. In his view real value of a product remains almost stationary while its nominal value fluctuates as per demand and supply. When this treatise was written Industrial Revolution had taken roots in UK and there were many restrictions imposed by the State to regulate imports as well as production. Smith was all in favor of free trade which was termed as lassaie faire.

Thus the thesis of Adam Smith overwhelmed by total freedom in trade and industry with no check on profit has brought the society to a scenario where only a few nations are delving in riches, luxury and excessive wealth at the cost of hundred others who have no means even to feed their population; similarly, at individual level, there are individuals who have tons of money, they probably have not even time to take stock of their accumulation while millions of their fellow men hanker even for basic necessities.

shopping-mall.jpgThough Corporations, as today, had not come into existence but state controlled or owned ones like East India Company were there. With the economic philosophy in their hands, as above, boosted by simultaneous revolution in science and technology, private owned corporations mushroomed shortly after which not only controlled economic activities but started having their say in governance too. In course of time, thus, there developed a strong bond between these two (corporate authority and government). With passage of time things have come to this pass that multinational corporations of giant magnitude and budgets of the size of many medium states are actually in control of policy making at the state as well as international level. With state functionaries in their kitty augmented by Adam Smith's economics of free market recognizing unbridled 'self interest' as their motto some nations and in them some individuals almost everywhere are in a position to dictate their terms to the entire globe.
With Renaissance in Europe and simultaneously throwing away the yoke of the Church from the organs of the state there remains no check and balance to halt these money grabbers. They are at their best to loot the common man: aam aadmi through the sale of their products under the grand umbrella of 'patent' or free market charging the value to their heart's content. Even in matters like illness and the suffering hapless their greed is unbounded. I had a rough idea that pharmaceutical companies sell even the life saving drugs at phenomenal profit of 1000%. But details were not available. Now looking into the misery of the aam aadmi Govt. of India has tried to supply some important medicines through Jan Aushadhi Stores. To begin with such stores have been started in Andhra Pradesh, Delhi, Punjab, Haryana, Rajasthan, Uttrakhand and Orissa. More have been assured to follow. I am wonderstruck at the difference in price at these stores vis-à-vis the market. See the

Name                   Dosage     Pack     Jan Aushdhi     Market
Tab.Ciprofloxacin     250mg     10     11.10     55.00
“ “                          500mg      10     21.50     97.00
Tab.Diclofenac         100mg     10     3.35     36.70
Tab.Certrizine          10mg       10     2.75     20.00
Tab.Paracetamol       500mg     10     2.45     10.00
Tab.Nemesulide        100mg     10     2.70     25.00
Cough Syrup             110ml     liquid   13.30     33.00

lab.jpgI am sure there is no subsidy involved and that even the price offered by the govt. contains ample element of profit to the supplier. From this it can be judged how prices have been inflated through 'self interest'. It is not only medicines, but all the products manufactured and sold by corporations or big companies carry the same tale.
There has been a raging controversy in USAabout Health Care Bill which President Obama wanted to bring. Since millions were not covered by Insurance, there was no medical relief for the poor. Previously, President Clinton also wanted to bring legislation to cover all, but the insurance lobby, the medical care providers, the doctors, the agents all combined and did not allow him to go through; this time also, great hurdles were put, but at last it has been passed. How far it will be successful only time will tell.
In India also there is a powerful lobby between all the four forces, mentioned above, and relief to the poor and dying is no body's concern. Looking into this the MCI (Medical Council of India) put restrictions on the doctors not to take any benefit either in cash, kind or facility from the pharmaceutical companies in lieu of promoting their products. But there is nothing to stop the human ingenuity. A via media has been worked out to hood wink the MCI and the doctors now will be shown as consultants and benefits will be doled out to them.
Our actors are reported to be earning up to even half a billion or more! As per Press Trust (Dainik Jagran 12th April 2010) actor Akshay Kumar has paid 18 crore as income tax while last year he paid 31 crore. The gross income respectively comes to about 55 and 100 crores. Amir Khan paid 12.7 crores this year while last year it was 11.25. The gross income comes to about 42 and 40. Sharukh Khan paid 9.5 as against 31 cores last year. The gross earnings are 32 and 101 crores respectively. Income of the cricketers is no less heavy. Tendulkar has paid 6.8 crores as against 6.6 last year. So is the case with Dhoni.

A NEW PARADIGM IS NEEDED AND IS NEEDED AND IS NEEDED AND
ALMOST IMMEDIATELY  WHICH IS FAIR TO THE PRODUCER AS WELL AS CONSUMER AND RESTPRES THE FAITH OF THE AAM AADMI IN THE MAJESTY OF LAW AND BENEVOLENCE OF THE STATE.

These incomes, by no yard stick, are modest. Barring a microscopic minority among renowned industrialists even the upper class and rich individuals are not earning that much. And what is the contribution of our Bollywood brothers? In the name of art and entertainment, under the constitutional guarantee of freedom of expression, they have overtly or covertly polluted the social fabric to the extent that youngsters are becoming criminals, students are committing murders or even hanging themselves from the roof like joy rides, new and newer ways of robbery, theft, kidnapping, ransom demanding and killing are being copied from cinema. Our 15000 years of old culture and value system nourished and nurtured by our rishis and munies of yore is being debased and destroyed. Yet, there are pseudo liberals, so-called votaries of Art & Culture, who gloat over the progress in film industry!

The 'invisible hand' has made massive earnings so easy that a novice, of course with good grade, right from management, engineering or IT school is offered not salary but “package” of 8,10, 20, 40 lakhs to even one crore straight away. The aam aadmi, poor chap, has to be content with a meager 100 to 150 daily. That too is govt. ruled which is hardly followed in remote areas.

Karl Marx was fed up with the pitiable condition of labor in UK under Industrial revolution. He came out with his fantastic theory of 'permanent clash between tools of production and production relations'. Thus, his followers gave the clarion call:”Labour of the world unite, you have nothing to lose but chains”. Thus was born an alternative economic philosophy which was given the name of Communism. Alas! Based on inherent defects in psychic sphere and devoid of spiritual back ground it became inhuman. Millions of people were tortured, sent to labor camps from 'gulag to archipelago', tortured and eliminated on the plea of class struggle and a perverse idea that: quantitative change leads to qualitative change. In this craze and frenzy they ruined the economy where ever they ruled. Eventually, the greatest dogma of the previous century was abandoned and free market economy was restored. Thus, Adam Smith wins over Karl Marx. Capitalism returns with all its failings and ills waiting in the wings.

Humanity can not wait till eternity to see slow decay and death of the faulty system and wrong economic theory nor the aam aadmi can be allowed to be the play thing of the forces of 'invisible hand' and unbridled 'self interest' or the market forces. A new paradigm is needed and almost immediately which is fair to the producer as well as consumer and restores the faith of the aam aadmi in the majesty of law and benevolence of the state. It is heartening to note that now even the learned professors of merit have started accepting the worth of PROUT which is being looked at as an alternative to the present economic system. Recently, there have been seminars shared by JNU professors in Delhi and Mumbai University professors in Mumbai. They have all extolled the great ideas inherent in this new philosophy. Let us see when the Lord's Invisible hands charter the new course of history and bring back on track the derailed train of humanity.

A?mi ye ru?per padme karechi aru?p madhu pa?n,Duhkher vaks?er ma?jhe a?nander peyechi sandha?n.Ananta maner va?n?ii shunechi antareDekhechi jyotir path shu?nyamay a?ndhar? pra?ntare,Nahi a?mi vidhir brhat pariha?sAsiim aeshvarya diye racita mahat sarvana?sh.
From the lotus of beauteous forms I have drunk the nectar of the formless,In the depths of misery I have discovered infinite bliss.I have listened to the message of the infinite silence,I have seen the path of effulgence in the dark endless void.Although a mere microcosm I am not just a joke of ProvidenceSurrounded by limitless Macrocosmic wealth, yet ending in The Great Annihilation.