Logic of self-interest and its victims
A one-sided debate has enabled several States, including India, to adopt libertarian policies in the name of reducing poverty and accelerating...
A one-sided debate has enabled several States, including India, to adopt libertarian policies in the name of reducing poverty and accelerating economic growth
Philosophers, thinkers and those who were free to think have given us abundant wisdom and institutions. The ontological understanding of 'who am I?' and the universe around us helped generate different concepts like the above in different civilisations, depending upon their geography, history and the circumstances. A One society might have called itself, another soul, and still others with innovative ideas as human experience. As humans, we inherit all the contributions, irrespective of what nation or group we belong to and exchange the ideas for mutual benefit.
It was during the age of Enlightenment that a strong cultural and intellectual foundation was laid to free humankind from superstitions. There were intense scholarly debates by schoolmen (scholastics) on every important event, giving birth to disciplinary knowledge. David Hume, Petty, Turgot, Quesnay, to name a few leaders of the era, contributed to human sciences before Adam Smith published his Wealth of Nations in 1776, a few years before the French and American Revolutions. It was David Hume and Adam Smith who set the fundamentals for a libertarian ideology. Interestingly Marx had also his moorings in Smith.
The present issue of how self-interest is responsible for development of a capitalist system has evoked debate that has become one-sided due to the hegemony of Bretton Woods's institutions and stoic silence of the opponents after the fall of the Berlin Wall. This has enabled several States, including India, to adopt libertarian policies in the name of reducing poverty and accelerating economic growth. Though the rudiments of LPG were present in the early 1980s, the loud declaration was, however, made in 1991. This has unleashed the sleeping giant to leap forward and created billionaires from India who found their names listed in the Fortune 500. Yet, several socio-economic internal contradictions, including inequalities, have widened.
Though the metaphysical deliberations about the self and its liberation from temporal attractions were deeply imbedded in different societies, elucidation of the concept as self-interest during the Enlightenment period seems to have been baked in pure materialistic process. Adam Smith was given credit for using the concept to usher in a new era in Europe, using gifts of enlightenment.
It is necessary to keep in mind the historical conditions and the uncivilized exploitation of colonies by the East India (mercantilists) company under the protection of the State that made Smith to react. He was compelled to appeal to self-interest of every individual as an author of 'theory of moral sentiments' for the possibility of enhancing the happiness of the enlightened individual and society.
He has explained how spontaneous realization of every individual to truck, barter and exchange one thing for another as a part of pure self-interest benefits everyone with daily bread. He has further discussed the topic with illustrations how it would work as an ' invisible hand' as a self-regulating mechanism that brings good to society. A The concept of division of labour and how it is limited by the extent of market are broadly related to laissez-faire. The basic elements of capitalist development thus move around the notion of self-interest. However, the role of the State to moderate disharmony of interests as advocated by Smith was capriciously kept aside.
The metaphor "invisible hand" of Smith, like the base -superstructure of Marx, has created warring groups to continue with their intellectual cudgels. The application of these ideas to contemporary situations by policy- makers to find practical solutions has created more problems than it resolved. In fact, the philosophical debate is taken to a newer height by scholars like Nozick, author of 'Anarchy, State and Utopia', who argued that it is within the principle of liberty and justice if a basketball champion like Chamberlain was given 25 cents by a million people to earn an income of $ 250000, more than the average earnings, irrespective of how it upsets the distributional aspects of a society.
This justification countenanced business people to bring IPL to India. It is further argued that if individual talents or resources are kept idle, they are a waste; and if they are traded in the market, they become wealth. What is the harm if individual players are bought and sold like commodities, depending upon their demand? Does it not sound reasonable and pragmatic?
Pareto, the libertarian, has developed the thesis of welfare optimization within the given system that operates under the spell of the invisible hand. Amartya Sen responded to this by saying that "a society in which some people lead lives of great luxury while others live in acute misery can still be Pareto optimal if the agony of the deprived cannot be reduced without cutting into the ecstasy of the affluent".
The theories of libertarians have contributed to expansion of globalization within the parameters of liberty and equality without qualifying the context and historical significance and identity of each nation. India, along with some other Third World countries, was attracted towards this noesis around 1980s that became a national policy in 1991. A During the last two decades, irrespective of the political party in power, they have sincerely adhered to the agenda of making self-interest the catalyst of economic development with a quantum jump of wealth of cronies and thus the GDP. This has enabled a dozen out of 120 crore people to own all most all that was created during the period.
This accomplishment was attributed to the operation of principles of invisible hand and self-interest in every walk of life, be it income, scams, corruption, rapes, moral turpitude, demeanour of the nation, etc. No one can take the credit or blame for the growth or decadence, except the preceptors of self-interest as a virtue. A Unfortunately, the exuberance has started dwindling and the drubbings are so pervasive that the preceptors of self-interest in the West were swallowed long ago. The behemoth in India in the early part of its operation devoured in the form of Hawala and Jain diary, and is now eating into the vitals of our civilization. Now, in times of acute depredation, does the Buddhist precept of seek refuge in society (sangham) provide metaphysical solace?