Does private interest promote social good?

It is widely discussed in our media that around 30 leaders belonging to different political parties of the country were united as spectators of a spectre of an economic game. It is called IPL and was sponsored by BCCI, the champion of Indian cricket. The total value of the cricket business is around $ 3 billion and in rupees Rs 15000-20000 crores. The benevolent government has given tax exemption on the revenue earned. Interestingly, all the political parties including the opposition that ripped into the ruling coalition recently on the issue of different 'gates' in Parliament remain quiet on the issue of match fixing and spot fixing. Thus, IPL has emerged as a symbol of group interest. The fixing drama as unfolded for the last one week might continue till the parliament session, as there are no issues to feed the media, it has cunningly avoided asking questions as to why do we need IPL?

The group is pursuing their interest in a democratic country that guarantees individual freedom to take up any profession or carry on any occupation, trade or business guaranteed under Article 19(g). If you ask any legal luminary or public intellectual, they might support the activities of the BCCI/IPL and could add that they are serving the nation by providing entertainment if not sports among the interested public. What is the harm or problem if they follow their group or private interest? In this context, two schools of thought namely, 'social choice' and 'public choice' have addressed some of the issues relating to private interests and the calculus of consent in a state to make decisions on policy, are worth mentioning here.

Perhaps our friends in the profession might be ready with theoretical formulations to substantiate why we need IPLs and how they help create wealth. Economists have long been arguing that any individual activity that does not involve loss of welfare of others can be promoted. The libertarian scholars cite the so-called Pareto optimality, a condition to frame that it is impossible to make some one better off without making somebody else worse off, to formulate policies of welfare and development. This principle advanced by the Italian scholar who was said to be close to Mussolini, the fascist leader, is parroted by every scholar to substantiate activities like the IPL, as they do not disturb this optimality and promotes individual liberty.

Another group of scholars have claimed that no voting rule that satisfy - decisive, consensus, non-dictatorship and independence, is possible given the social choice (Arrow impossibility) under Pareto conditionality. Buchanan who developed a similar public choice theory has also examined the rent �seeking actions of bureaucrats while formulating public policies. His arguments have been used by World Bank economists to annihilate 'state' authority on the ground that public choice decisions do not necessarily promote welfare. Politics, Buchanan said, 'is a process with which individuals, with separate potentially differing interests and values, interact for the purpose of serving individually valued benefits of cooperative effort'.

Thus, he was critical about the American politicians and bureaucrats as rent-seekers (an activity through which companies gain through lobbying without benefit to society), but very appreciative of the institutions promoting liberty. We are citing these theories (mostly technical) here as it is under their illumination most of the policies in government today are formulated everywhere in the so-called free world, including India.

The private interests of the IPL group or some other activity tomorrow like using the tonnes of smashed ganja (cannabis resin) of the Customs and Excise Department profitably to create wealth etc, are issues to be debated. Both Ganja and IPL with all kinds of support structures provide entertainment and simultaneously create wealth and why not we promote? Are we not deriving revenue by sponsoring IMFL?

The libertarians had a strong foundation in Positive Economics that does not speak about normative issues as values-based economics is "dreadful thing to accept" (Hicks). One might still question the above cynical proposition, saying that policy makers are not chumps to accept such plans that involve public morality. But, we had proposals like making corruption a legal activity with the market forces deciding the worth, etc. Now IPL is in force. Though, the issue raised here appears to be simple and silly, they are in fact the concerns that are being confronted by the common man every day. We do not have competent people to counter the elegant arguments of experts to outwit them so that the scarce resources are used for the benefit of the deprived or social good (clean air, water etc).

The civil society, public intellectuals, media etc have a role to play here rather than leaving it to the 'paid intellectuals' to think, reflect and formulate policies on our behalf. You may not possess the abstract reasoning of mathematics, a language and not an ideology, to hoodwink common man. But your active involvement in public reasoning and participation in alternative exercises would definitely provide solutions to TINA (there is no alternative).

There is in fact a long tradition in social sciences to counter the arguments formulated by the libertarians from the time of Hume. Sismondi, Marx, Ruskin, Hobson, Schumacher in the past, Amartya Sen to some extent in contemporary world articulating resolution to respond to these challenges. Sen has resolved the impossibility riddle of decision making through the process of interpersonal comparisons. Addressing the problems of rights and liberties of the minorities and weaker sections with social goods that satisfy basic needs, capabilities and information broadening, he said that 'a State can be Pareto optimal and still be sickeningly inequitable".

We may also consider how the policy makers have banned the concept of public good (common good that provides utility to every one without rivalry) in their quest for creating wealth and auctioned even natural resources like rivers. Interestingly, the policy makers have used select theories like the above that have fascist tendencies with Western values of market significance. The institutional structures of other societies that have promoted welfare to people have no relevance in their formulations and are covetously determined to annihilate if some are found survived.

The IPL episode is only a small hunk of a large mass of rapacious aggrandizement of chosen few from traditional business groups who care less for human values except money. They keep on inventing institutions that facilitate exploitation, corruption and distribute spoils. Fascinatingly, they are the ones who use liberty as a value to exploit for their own benefit or group with a minimalist state to ensure enforcement of contracts and nothing else. A The Aristotle's Nicomachean Ethics that define human good as happiness acquired through the virtue of justice seem to be not in reckoning, if not evokingthe ideals of a welfare state buried few decades ago.

With over $ 3 billion (`15000-20000 crores) A at stake in cricket business, and with tax exemption on the revenue earned, there are people who might support the activities of the BCCI/IPL and add that they are serving the nation by providing entertainment, if not A sports, among the interested public