The abysmal collapse of governance in India has a silver lining. It is making Indians self-reliant. In many ways India is fast becoming a libertarian anarchy. After being an experimental laboratory to prove unambiguously the intellectual poverty of socialism, India is now a laboratory in libertarian anarchy!
The government simply does not work in India, or works so badly that citizens scrupulously avoid it. But in a convoluted and unexpected way, India's misgovernance is becoming a blessing in disguise – forcing Indians to rely on themselves and their own ingenuity.
Government schools don't work (they can't work in any system, anyway). So parents in India send their children to private schools. Even those who can't afford private schools (which are really cheap, and all of them "English medium") at least try to send their children to a private 'refresher' school after school hours, a place which teaches some kind of English and IT skills. A variety of "polishing" and "finishing" schools are sprouting everywhere and flourishing – so huge is the demand for education of children.
Not only are Indians forced to buy your own education but they have to buy their own health care. Except for a few most government hospitals are defunct. You are more likely to catch disease if you go to one of them than to get cured. So private hospitals of international standard have sprung up everywhere and even private clinics are relatively cheap. Self-insurance is the only way people can survive in India. There is no better lesson in free markets than that.
Nozick speculated that private protection associations will arise in the libertarian anarchy. That is quite implausible (as I show in DOF), but what is happening in India is that people are paying for their own security. Private security guard businesses are flourishing. For those who can't afford private security, payments are made to the local goonda and police constable. Far from ideal (security, I believe firmly, is the job of the state), but at least people are coping.
Municipalities in India are centralised behemoths that simply can't work the way they are designed. They are dead as a dodo. They can't clean up their own backyard, leave alone the streets. Hence Indians have organised private garbage removal services. That these garbage removal services dump the garbage into the nearest river or pond is a separate matter (where the state should come in), but at least their garbage gets cleared from their house.
True, Indians can't buy infrastructure (like roads) through the private sector, nor can they get clean drinking water. But that is the price Indians are paying for themselves voting – repeatedly – the most corrupt governments of the world into power. A country always gets the government it deserves.
The lessons Indians are drawing from this anarchy
The lessons that Indians are learning now will hold them in good stead in the future. These lessons include:
a) Don't rely on the government!
b) Look after yourself for there is no one else who will look after you!
c) Stand up on your own feet for there is no welfare state to pamper you!
As these lessons are internalised, the results will be very good. India is already showing signs of becoming one of the world's most competitive societies: cut-throat competitive, not merely competitive. Super-competitive. Agile. Fighting fit.
Anyone who can provide even the remotest semblance of quality at a decent price in India can now become a multi-millionaire in just two to three years. That's all it takes now, in this vast market – which is continuously looking for better quality at a lower price – to become super-wealthy. This MASSIVE competitiveness will one day redeem India, and also, indirectly help to demolish the fat welfare states of the West that are now simply too complacent because countries like India and China have not yet got their acts together. But one day they will. And the signs for India are excellent.
Examples abound today everywhere in India of the astonishing advances Indians are making. From manufacturing to services, the country is a bubbling cauldron of energy. Things are changing rapidly through intense competition. The telecom revolution is an indicator, but there are hundreds others examples well documented in books like Gurcharan's outstanding books, and those by Khanna (Billions of Indians) and Kamdar's Planet India. Tens of other books discuss this phenomenon in detail. Most importantly, management books have drawn valuable lessons from this energy.
From this great experiment in libertarian anarchy, hundreds of brilliant lessons can now be easily drawn by economists worldwide. Many books have already been written, as I noted above, exploring the market-based revolutions of India. But much more has to be done to study the lessons from these experiments. The people are too busy to document their fantastic energy.
Role for a liberal political party: to provide good governance
This huge surge towards wealth in India can be dramatically speeded up if good governance can be made available to Indians. Unfortunately, NONE of India's existing political parties is capable of providing anything close to good governance. There are systemic reasons why that can't be done. It can only be done if a strong liberal political party is voted to power but there is none at the moment! That gap is what FTI aims to address (some initial work has started on the Freedom Party of India website).
The task of reform has unfortunately been hamstrung because Indians have been so smitten with either socialism or Hindutva that they are no longer able to straight and logically (no matter how intelligent they may be!).
The day when just 1500 outstanding leaders assemble on a liberal platform, India will be well on the way to becoming the world leader in EVERYTHING. I have no doubt about that.
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