Sunday, May 28, 2000

Tobacco: At the Cost of Liberty

May 31 is the World No-Tobacco Day. In recent months World Bank and the World health Organisation have led an orchestrated attack on tobacco in the name of public health concerns. The following article seeks to estimate the costs of this onslaught, and finds that what is at stake is individual liberty, personal preference and responsibility. A version of this paper titled War on "Tobacco: At the Cost of Liberty" was published in The Telegraph newspaper of Calcutta, on May 28, 2000. Earlier in the month, Liberty Institute released a book, War on Tobacco: At what Cost? It has two contributions, one by Prof. Deepak Lal, and the other is by Roger Scruton.

The greatest political achievement of the 20th Century has been the empowerment of the citizen. It has been generally accepted that despite its many flaws, there is no better political instrument than democracy to enable the people to participate and decide how they should be governed.

However, in parallel to this development there have been continuous attempts to restrict people's choice in the name of preserving public morality, health, economic well being, and now the environment. Clearly it has not been easy for the ruling establishments to recognise that if people have a legitimate say in choosing their representatives, then they have all the more right to decide on their personal preferences. Particularly if in the exercise of those preferences no one else is hurt, and the person bears the cost of making that choice.

Time and again it has been seen that the cost the society has paid for the proclivity of the elite to control has far outweighed the supposed benefits. Yet, insidious attempts are made again and again endangering the political and economic freedoms that the common man has fought hard and won after many millenniums of struggles. As we enter the 21st Century, these self-proclaimed benefactors pose the greatest threat to individual freedom and wellbeing.

The growing intensity of attack on tobacco, ostensibly on grounds of public health, is but another manifestation of the insidious assault on individual preferences.

It is well known that the misguided constitutional amendment to impose prohibition in the United States in the 1920s, not only failed to curb alcohol but inevitably fuelled crime. The fate of successive governments in India also bears testimony to financial and social costs of similar policies.

In the sixties, the Indian government had the gold control law that virtually prohibited international trade. It is now open secret that this policy was singularly responsible for the growth of international smuggling. Today, those very channels created to subvert the gold regulations are being used to send in weapons and RDX explosives that are threatening political fabric of the country.

The cost of "war on drugs" launched by the United States has been rising constantly, both monetarily and socially. The prison system in the US is overflowing with alleged drug offenders. And yet with all the billions of dollars spent on this war, the promised victory is nowhere in sight. Indeed, some of the governments in Central and South America are being increasingly marginalised by the drug mafia in spite of the money and material being poured in by the US, threatening the social fabric of these societies.

Good intentions of do-gooders are never a sufficient condition for bringing about social change. The do-gooders claim to make life safe and free of risks. Only a prison may hope to provide such safety, and even that is no longer assured.

Life is about taking risks, and coming out on top. Another name for that is private enterprise. But naturally, enterprise is anathema to all control freaks.

Lets look at our own history. Drugs and alcohol have been a part of Indian culture and tradition from time immemorial. Yet, there was no evidence of any collective decay or degeneration on account of this. Nevertheless, today we are a democracy with universal adult franchise. The underlying principle being that every voter irrespective of his or her social, religious, economic or educational background possesses the basic wisdom necessary to meaningfully participate in the decision making process of the country. Yet, at the same time these do-gooders think that these very people are incompetent to decide on issues that directly affect their lives - drugs, alcohol, tobacco, lottery, foreign media.

No doubt, there will always be some people who will make a wrong choice. But the society as such undoubtedly comes out much stronger from such experiences. That is why no such control measure was every necessary in past.

International agencies like the World Health Organisation have been trying to rally support for their crusade against tobacco. Lets look at some of the other issues that are supposed to be WHO's prime focus. Lack of clean drinking water and hygienic sanitation facilities, malaria and all the other avoidable diseases continue to wreck havoc on many parts of the world, including India. But focussing on those would mean holding the one factor responsible for these - the role or lack of it played by the various governments. And of course, WHO is made up of national governments. How much more convenient, therefore, it is to hold the common man on the street, who are struggling for his basic survival, responsible for his own alleged follies.

Not surprisingly, WHO and the like are motivated by costs, particularly the costs to the state health service. But the costs and inefficiencies of the health service should lead to a call for its denationalisation, private participation and introducing competition. More importantly, the role of the state health sector is quite marginal in countries like India. A vast majority of population, rich and poor alike (unless one is well connected) prefer the private facilities and even quacks, to the humiliation and indignity offered at most government clinics.

Openness and participation have been great buzzwords at recent international jumborees in recent years. Yet, we don't see the activists and the NGOs on the streets against attempts to control people's preference for tobacco. The reason being that most of these self proclaimed representatives of the people are control freaks themselves and see the WHO as carrying the same candle. They see the WHO's attempt to control health care, and restraints on individual freedom, as a means of legitimising their own agenda for control on a whole range of issues - economic and political.

Clearly, this desire for control posses the greatest threat to individual freedom, dignity and choice in the new century. And the voice of true protest at this insidious subversion is growing around the world. Eminent personalities such as the Nobel Laureate economist Milton Friedman have called for an end to war on drugs. Popular movements are spreading in many parts of the world forcing the governments to go slow on that war or even consider legalising certain drugs.
It will be a real pity if under the aegis of WHO, a new "war on tobacco" is launched even as the previous one is collapsing. The ominous consequence of this new war can already be seen in increasing reports of smuggling of cigarettes across the border in to Canada from the US.
Of course, cigarette is not even main issue in India. Tobacco in the form of the humble beedi, and various forms of chewing tobacco constitute one of the most simple and perhaps only forms of pleasure that is accessible to millions in India and other developing country.

These are the very people who have had to bear the burden of failed government economic policies, and unresponsive and indifferent administrations. But thanks to our democracy, there is probably no political leader brave enough to go out and tell these people that if elected they will send out the police to sniff out tobacco from their homes. Exactly, the same reason why we see our elite talk bravely about the need for population control, but no one dares to do anything about even after a 25 years of Mrs. Indira Gandhi's ill-advised bravado. Agencies such as the WHO provide a very good cover to push for control that will other wise never receive popular mandate.
There is no denying that tobacco carries a degree of risk. But life itself is full of risks and uncertainties. Indeed, it is the attempt to lower some of the risks and overcome some of the uncertainties that contribute to improving the general quality of life. In the process giving real meaning to life.

The question, therefore, is who should to bear the cost of taking the risk? Should he be allowed to force others, who are not so inclined, to accept some of the risks on his account. In the context of tobacco, the obvious question is about passive smoking.

According to economists these are problems of externalities, particularly caused by market failures. To ensure the supply of public goods, it is argued, the regulations are necessary to induce private operators in the market to behave in a responsible manner.

It is often forgotten that people have been devising various strategies to deal with such situations for a long time. Even without going in to science of whether and to what extent passive smoking may be harmful, one can site many instances where people have devised voluntary responses to similar situations.

For instance, eateries and restaurants in India routinely publicise their "pure vegetarian" or "non-vegetarian" status, depending on the clientele they seek to attract. Many also have add-on features such as ban on alcohol or cigarettes. Depending on the nature of their passengers, many privately operated chartered bus services in Delhi, often charge extra for qualities such as smoke free rides or allowing smokers. The demand from smokers has induced some international airlines to offer special flights. The power of private negotiation best comes through reported instances where passengers sitting at the border zone of smoking and non-smoking seats in airlines have stuck monetary deals to induce a neighbouring smoker not to light up during the flight.

These illustrations of amicable settlement of private preferences over so-called public domain contrasts sharply with the performance of the public regulations. For instance, in Delhi a law was passed giving powers to wide range of government officials to arrest smokers in an attempt to restrict smoking in many designated public and private (deemed public) places. In over two years since its passage, there has been no report of any prosecution. This implies, that either the law has achieved its objective, or, more likely, that it has been so grossly violated that it is impossible for the public authorities to seriously try to prosecute a violator.

Tobacco regulations are an attempt to drag to the public domain what is essentially a private issue. With the collapse of socialism, the enormous economic costs of trying to allocate resources by bringing private property under public control has been fully exposed. A much more efficient way is to bring under private control much of what is thought to be in the public domain - privatise the public goods.

One of the biggest advantages of this approach is that one may bypass the whole issue of evaluating scientific evidence for and against tobacco. Consequently, science doesn't get politicised under the pressures of public policy making. Likewise, public policy doesn't get embroiled into scientific debates, and instead focus on ensuring maximum space to the public so that everyone can negotiate their respective preferences. That is what an open market provides.
The refusal of many public agencies and activists to explore the non-regulatory approaches to the tobacco debate actually exposes their real agenda. The need to create an environment of crisis in order to justify their regulatory controls. Clearly, the issue of public health is a fa├žade to camouflage the restrictions on freedom of choice, curbing individual preferences those regulatory controls invariably imposes.

In a dynamic and competitive economy, companies and even industries come and go. And there is no reason to shed any tear for the tobacco industry if it fails on economic reasons or because of changing consumer preference. But the orchestrated assault on tobacco national and international agencies is not just an attack on one particular industry. This is an attack on individual freedom and liberty. It is time to call the bluff before in the name of public health the world is turned in to a living hell. Clearly, the cost of the war on tobacco is too high.

Thursday, May 11, 2000

India's One-Billionth Asset-The path to prosperity is economic freedom, not population policy

At noon on 11 May 2000, Aastha, a baby girl born in Delhi. She was officially declared as the billionth Indian.

My article titled "India's One-Billionth Asset-The path to prosperity is economic freedom, not population policy" was published in May, 2000.

India's population officially surpasses the one billion mark today. While government officials search for the suitable baby to herald the occasion, there are no plans for any grand birthday party. Instead people are being somberly reminded of the burden of the billion plus population.
It is ironic that India has reached a situation where the birth of a child is considered to have a negative impact on GDP and other economic measures, but the birth of a calf, or production of an additional ton of rice or iron is considered to be positive.

Is India's growing population to blame for its relatively poor economic performance in the past 50 years? Or did the policies pursued by successive governments lead to a massive waste of resources -- including human resources -- and seal the fate of so many in abject poverty?
Clearly, it is the economic policies that have failed, and population has come along as a convenient bogey to hide the policy failures. Indeed, population policy has become a weapon of war against the people themselves, placing the blame on the victims -- the poor -- for India's massive poverty.

The government argues that India's natural resources are simply inadequate to meet the needs of growing numbers of people. But as economists such as the late Julian Simon have pointed out, prices of virtually all major commodities have been falling. This indicates not so much a scarcity of supply in India, but an inability to utilize these resources efficiently due to misguided policies.

Foremost among these have been restrictions on trade. When the British left in 1947, India's share of global trade was about 1.5%. Today it is just 0.7%. Trade was considered incidental to development. Leaders chose to ignore the fact that, just as democracy empowers the people by allowing them to make choices in the political domain, trade empowers them by expanding the range of choices in the economic domain.

Having forsaken the road to empowerment, the state adopted a system of licenses, permits and quotas allegedly to promote planned all-round development and ensure the equitable distribution of resources. The result has been over-centralization, corruption, waste and poverty.

Now some small steps have been taken to liberalize the economy and free the people froom the shackles of state regulations. However, it is not easy for vested interests to give up their privileges. So we still see attempts to resurrect the issue of population growth in order to justify statist policies.

It is claimed that increasing population places unsustainable demands on the environmental resources, and therefore restraint on population is necessary to preserve the health of the nation and the planet. Of course, there has been some significant environmental degradation alongside economic growth. But more often than not, this is due to the failure to bring environmental resources under the discipline of market forces. After all, environmental quality is like any other value-added product. -- economic development alone makes it affordable.

Liberalization and globalization provide the best opportunity to the poorest of the people to escape the clutches of both domestic tyrants and failed policies. So recent protests, particularly in the West, against liberalization and globalization in the name of the poor can at best be misinformed -- at worst racist.

Recurring themes at these protests have been the claim that the present levels of consumption is inequitable, since barely 20% of the population consumes about 80% of the resources, and that these levels of consumption are unsustainable, since the global environment may collapse if all the Indians and Chinese aspire to the consumption patterns of the developed countries.

Maintaining the status quo and requiring those who in any case have very little to consume, can only help perpetuate the gap between the haves and the have-nots. Some intellectuals, with no political constituency, and activists sustained by constituents who don't have any concept of poverty in third world countries, can hope to get away with such iniquitous policies. But no political leader in these countries, least of all a democratic one, can escape the wrath of the people he promotes such an approach.

Nevertheless, the arguments persist and are quite widely held in influential circles in many countries. In India, of course, Indira Gandhi's misadventure into population control in the mid-1970s has made the political authorities extremely cagey about direct measures, no matter how much they might want them.

But in the last ten years, there has been as attempt to devise more ingenious ways of attacking the population problem by attacking the poor directly. In many local bodies, electoral criteria disqualify anyone with more than two children to contest a post. Such laws were also proposed at the national and state levels, but because they would have hurt incumbents the most, they never saw the light of day.

The population policy announced by the present government a few months ago promises a wide range of incentives to those who adopt the two-child norm, while doing away with the direct disincentives and penalties of the past.

While this may be seen as a sign of progress, any form of population control diverts attention from real issues of economic policies that might have made the need for a population policy redundant. In addition, the focus on fertility necessarily politicizes the whole issue.
India has had a policy on virtually everything under the sun. Yet, her performance has left much to be desired. India's population policy stand as the ultimate symbol of the political elites' arrogance. More than anything else, this policy implies that a voter has political rights, but not the right to decide something so intimate as the size of his or her own family.

As we enter a new century, it is time for Indians to jettison this sense of contempt for our own people. People are not only consumers, they are also producers. Indeed, they are the ultimate resource in that they give meaning to all other resources. A population policy fails to distinguish between people and all these other resources, and therefore ends up launching a war on the very people who constitute the demographics.

Instead of framing more new policies, it is time to take a break from policy making, and give people the choice to make their own decisions -- economic, political and social. What people need is the space to harness their own enterprise and initiatives and realize their own potential. In this regard, freedom is the best policy. May be then we will be able to celebrate the arrival of the billionth Indian.

Saturday, May 6, 2000

War Against Tobacco threatens Liberty and Economic Development, warn International Experts

My press release titled "War Against Tobacco threatens Liberty and Economic Development, warn International Experts" was published on 6th May 2000.

In a new book, War on Tobacco: At What Cost? international experts point out that the cost of the new war against tobacco is unacceptably high, both economically, and politically. Deepak Lal, Coleman Professor of International Development at University of California, Los Angeles, and one of the two contributors to this volume, reviews the recent World Bank report on tobacco and finds that contrary to the Bank’s claim, there are significant positive effects of growing and using tobacco.

Mr. Gurcharan Das released the book at a function on 6 May, 2000, in New Delhi. Prof. Lal summarised his paper. Dr. Shreekant Gupta of Delhi School of Economics, commented on the paper, and the meeting was chaired by Dr. Bibek Debroy of Rajiv Gandhi Institute of Contemporary Studies. There was a livey question and answer session at the end. The programme schedule of this event is available here.

In his paper, Prof. Lal, while acknowledging that tobacco use is harmful, warns against making unjust economic claims against tobacco in the health activists attempt to reduce smoking. The Bank proposes increasing taxes on tobacco, but Prof. Lal finds that the economic welfare losses from existing taxes are huge. He says, “For India, the per smoker loss from current taxation is nearly twice per capita GDP, and the aggregate loss from current and future taxation (of, say, a 10% per annum increase in taxes for 10 years) would be a massive 80% of current GDP.” The anti-tobacco crusade from the West, like the environmental one as manifested at the WTO meeting Seattle last December, is the newest manifestation of the neo-imperialistic desires.

Prof. Lal concludes that the Bank provides no cogent reasons for its crusade against tobacco in the developing world, particularly since most of the costs and benefits are privately borne in these countries. “The attempt to inflict the estimated large losses of economic welfare on poor people is wicked and shameful, when for so many of these poor the noxious weed is one of the only sources of pleasure in lives which remain nasty, brutish and short.”

The second paper in this volume is by Professor Roger Scruton, a well-known British philosopher and writer. He warns of the harms to national sovereignty of allowing the World Health Organisation to dictate global policy on tobacco. Furthermore Scruton makes an eloquent defence of smoking - The WHO has no right to tell you if you can smoke. Smoking is a choice, not a disease. Mrs Brundtland, the head of WHO is trying to become a global nanny, and to export her desires for a Tobacco Free World (through a UN style Convention), she has resorted to claiming that tobacco is a disease. Scruton is alarmed that by claiming tobacco as a disease it opens the floodgates to more conventions, perhaps on drink, drugs, cars all of which kill, the list is endless.

“In our secular age, it is more than ever necessary to safeguard the old idea of law, as a guardian of individual freedoms, rather than an instrument of enforced conformity. Wherever legislation is unnecessary it is wrong. And the decision whether it is necessary should be ours, and made through our elected legislatures”, writes Scruton. It seems ironic, that at a time when “democratisation” and “devolution” are the buzzwords, unelected and unaccountable trans-national agencies such as the WHO are formulating global legislation “in order to impose the social and political agenda of handful of activists.”

Barun Mitra of Liberty Institute, writing the foreword to this volume says that democracy empowers the citizen by giving him the freedom of choice in the political domain. By the same token it is untenable to suggest that the same citizen is incompetent to exercise the same freedom to decide on more mundane issues such as whether to smoke or not. Mitra also points out a number of instances where people have voluntarily sorted this issue without recourse to any legislation. “Depending on the nature of their passengers, many privately operated chartered bus services in Delhi, often charge extra for qualities such as smoke free rides or allowing smokers.” This is in contrast to the failure to bring in even one prosecution under the recent law in Delhi that prohibits smoking in many public and private places, although the law is observed more in the breech.

War is always painful and expensive. Clearly, the one on tobacco is no exception, but it can easily be avoided. It requires recognition of fellow human beings as necessarily equal. The message may be simple, but human history is a story of a continuous struggle to claim that equality. Let’s not add tobacco to that onerous list.

Monday, May 1, 2000

Population: The Ultimate Resource

The press release titled "Population: The Ultimate Resource" was published in May 2000.

Twentieth Century has witnessed unprecedented demographic changes. For the first time in history, the world population almost quadrupled from about one and a half billion in 1900 to six billion in the span of just hundred years. Likewise, Indian population too crossed the one billion level in May 2000, from about 238 million at the beginning of the Twentieth century. This is particularly significant, since as late as the 1920s, India had experienced a slight decline in population due to poverty and deprivation.

At long last it seems that man is successfully defying death and deprivation that were constant companion of his ancestors. Infant mortality rates have fallen, life expectancy at birth have doubled or tripled, and the result is that there are more of us to enjoy life on earth as never before.

Yet, there is hardly any sign of celebrations. It is amazing that such an achievement is virtually going unnoticed. Instead all we hear is that the planet may be on the verge of collapse because of the burgeoning numbers of humans.

It is ironic that many environmentalists who would herald similar growth in population of some of the endangered species as a very good indicator of the environmental health of the planet, see the success of man as a harbinger of environmental doom. Even many economists usually consider an increase in production of steel or birth of an additional calf, as positive addition to the national output or Gross Domestic Product, but view the birth of a human child to have a negative impact on GDP.

It is indeed ironic that the birth of a human child is valued so little. After all, that baby might be a potential Tagore or Einstein, or an entrepreneur who put up that steel mill, or the farmer who nurture his land or cattle to increase its yield, or the worker who strive to increase his productivity. And it is precisely on that potential that the future of humanity depends.

Julian L. Simon

This book is dedicated to the man who thought otherwise - Julian L. Simon. He appreciated the enormous cost mankind has paid throughout history when the population is estimated to have stayed stable at a few million, and life expectancy hovered in the twenties. This made Simon aware of the true potential of man that has made him overcome such great odds.

Simon successfully challenged and helped turn on its head the centuries old Malthusian fear that a growing population will simply devour the planet, and lead to famine, disease and death of civilisation as we know it. Human population that barely crawled for millennia, suddenly tripled in the 20th century, but the world per capita output quadrupled during the same period, improving the quality of life for everyone. The best proof of this comes from the doubling or in many cases even tripling of life expectancy at birth in step with population increase.

Simon was to write later "It is your mind that matters economically, as much or more than your mouth or hands. In the long run, the most important economic effect of population size and growth is the contribution of additional people to our stock of useful knowledge. And this contribution is large enough in the long run to overcome all the costs of population growth."

Julian Simon was an economist and demographer who taught at the University of Maryland at College Park, just outside of Washington, D.C. In the 1960s he became concerned at the state of affairs and the growth of population on the planet, and wanted to do something meaningful in order to prevent the seemingly inevitable doom that awaited man. He began looking at data to see the kind of impact man has had on the planet. And he was in for a surprise.

Virtually every data he looked at, from life expectancy and infant mortality rates to health indicators, to prices of natural resources and consumption good like food items, to environmental quality, things seemed to have improved, and have been doing so for as long as one could see. Only, in the last few centuries, the improvements have accelerated even as population began to grow. Simon was convinced, "The standard of living has risen along with the size of the world's population since the beginning of recorded time. There is no convincing economic reason why these trends toward a better life should not continue indefinitely."

Simon first came in to public prominence in 1980. He took a very unusual step for an academic. He decided to place his money on the validity of his position that there is no scarcity of natural resources. He challenged any one to bet with him on prices of any natural resources. He said that if the resources were becoming scarcer, then their prices ought to rise, and he was prepared to bet that the prices would actually fall. Paul Ehrlich, a biologist and one of the foremost critics of population growth, along with a couple of colleagues, decided to take up the bet. Simon and Ehrlich agreed on five metals - copper, chrome, nickel, tin and tungsten. The bet was to be settled a decade later.

In the meantime, Simon published his masterpiece, The Ultimate Resource. He marshalled all the evidence and data and showed the long term trends. "Our supplies of natural resources are not finite in any economic sense. Nor does past experience give reason to expect natural resources to become any more scarce. Rather, if history is any guide, natural resources will progressively become less costly, hence less scarce, and will constitute a smaller proportion of our expenses in future years," he wrote. The book was completely revised and expanded in its second edition in 1996. It has now been published in over half a dozen languages. It is even available in Chinese. We hope we will have an Indian edition in the not too distant future.

The bet was finally settled in 1990. As Simon had predicted, the prices of all the metals had fallen. The fall in some cases had been so dramatic that Simon would have won even if the prices were not adjusted for inflation. Ehrlich paid up, although he claimed that the drama was not of any environmental significance. But no one ever took up Simon's standing offer again.

Simon continued teach that, "The ultimate resource is people - especially skilled, spirited, and hopeful young people endowed with liberty - who will exert their wills and imaginations for their own benefit, and so inevitably benefit not only themselves but the rest of us as well."

I had first read The Ultimate Resource in the mid-1980s. It was an eye-opener. His sense of optimism was infectious. He taught me to really appreciate the true potential of man, particularly free and independent man not chained by social customs or bureaucratic regulations. I wrote to him in 1990 after I read about the outcome of his bet. I wrote that I had not believed that any one would be foolish enough to accept such an obvious loser. That it was Ehrlich, only showed the intellectual hollowness of our opponents. We corresponded off and on, and then had the honour of being associated with some of his work. He was instrumental in introducing me to a lot of people around the world, and helped in establishing the Liberty Institute in 1995, and was a member of its board of advisors. He along with his wife, Rita, very generously travelled to India in 1997 and participated in our Freedom Workshop in Devlali (near Nasik).

Following his sudden death in 1998, we named the research section of the Liberty Institute after him. The Julian L. Simon Centre we hope will keep alive his indomitable spirit, and never ending sense of inquiry.

Simon viewed people to be the ultimate resource. He held that for their talents to flower and come to fruition, people require conducive economic and political framework that provide the incentive for working hard and taking risks. "The key elements of such a framework are respect for property, fair and sensible rules of the market that are enforced equally for all, and the personal liberty that accompanies economic freedom. In the absence of such a framework, the short-run costs of population growth are greater, and the long-run benefits fewer, than in free societies." Likewise, the primary objective of Liberty Institute is to promote appreciation of the institutional framework of a free society - individual rights, rule of law, limited government and free market.

People don't come with just a mouth, but also a mind. They are not just consumers, but also producers. This explains the apparent paradox that more we consume, more we have left to consume. Simon showed that while our number have multiplied, far from depleting the resources these have become more abundant as measured by the falling prices of almost every resources over time. The only resource whose price has been increasing consistently is that of human labour. This is the only resource which has become progressively scarce even as their numbers have grown. Because, increasing ability to consume, in a free economy, induces producers to innovate and develop newer, cheaper and better products to attract the attention of consumers. Clearly, a society that considers her people as the ultimate resource, and recognises the value of freedom will discover the key to unlimited resources.

Simon genuinely rejoiced at the potential that every new life brought. He wondered how many Michaelangelo or Einsteins would be lost to the world because of misguided preference for birth control policies. For him life was always full of promise and possibilities, and he was full of optimism that as people struggled with problem, they would make the world a better place than ever before.

Simon did not say that there were no problems. He only said that the trends were that life was getting better than before. He admired man's willingness to strive to improve further. As we enter the next millennium, and think of all myriad problems confronting mankind, we would do well to remember Simon's predictions for the coming century, "humanity's condition will improve in just about every material way." The issue will clearly continue to be debated in future just as even the ancient Greeks had worried about the possible Malthusian doom much before the arrival of Thomas Malthus himself two thousand years later. But another prediction of Simon unlikely to generate any debate is: "humans will continue to sit around complaining about everything getting worse."

The Argument

In this small volume we have sought to bring together the ideas of Julian Simon, and others who shared his basic perspective. But each of the essays seeks to bring out a different aspect. The book has four articles of Simon. The first is his speech at our Freedom Workshop in 1997. Here he outlines his basic ideas concerning population, environment and development - that more people, produce greater wealth, enjoy a healthier environment and have access to abundant resources.
In a second article Simon argues in favour of immigration. In view of the periodic outburst of sentiments against immigrants from neighbouring countries, and migrants from countryside to the cities, that we experience, Simon's reasons for keeping the borders open should be of interest to readers in India. He says, "Opponents of immigration seek to persuade us that new immigrants damage society economically, politically, and culturally. Immigration restrictions are intended to "protect us" in the same way as tariffs and trade quotas. But like trade barriers, immigration restrictions largely protect us from benefits." He reminds us of the tragedy of the now defunct Berlin Wall where so many lost their lives trying to escape from tyranny at home. And in his characteristic fashion he says, "This should remind us how wonderful it is that people want to come here."

In another piece, Simon takes an unusual look at Shakespeare's Sonnet I, and finds that the bard's "vision uncannily parallels a current theory on the subject." In the poet's quest for truth and beauty, Simon finds " truth and beauty are like knowledge, and thereby like the supply of natural resources that flows from knowledge, …..our stocks of intellectual goods are not depleted by use, but will continue to enhance forever human life." This essay provides a distinctive insight in to Simon's mind, and provides a glimpse to the sense of joy the author feels as he goes about exploring new territories.

We have also included an autobiographical piece that Simon was asked to write in 1996, a couple of years before his death. In this piece Simon not only sketches his life, but also shares his philosophy. He concludes by a self-assessment, "I have lived an extraordinarily lucky life." True to this assessment, this lucky man has left the world incredibly richer.

Lord Peter Bauer, the dissident development economist, in this reprint of his 1991 essay shows why a growing population is not an obstacle to economic development. He writes, “There is ample evidence that rapid population growth has certainly not inhibited economic progress either in the West or in the contemporary Third World. The population of the Western world has more than quadrupled since the middle of the eighteenth century. Real income per head is estimated to have increased fivefold at least. Much of the increase in incomes took place when population increased as fast as in most of the contemporary less developed world, or even faster.”

Advocates of population control generally like to point at the apparent reduction in per capita availability of agricultural land. They assume that this trend has sealed the fate of mankind. However, Bauer says, "It is pertinent also that productivity of the soil in both prosperous and poor countries owes very little to the "original and indestructible powers of the soil," that is, to land as a factor in totally inelastic supply. The productivity of land is the result largely of human activity: labour, investment, science, and technology. Moreover, the factor price of land, including return on investment, is a small part of the national income in most countries; and this proportion has tended to fall rather than rise those Western countries for which reasonably reliable statistics are available. This would not be so if land were acutely scarce are acutely scare relative to other productive resources."

Deepak Lal, another renowned development economist in this updated version of his 1989 article finds that that population growth has had no impact on India's economy, particularly agriculture, and that there were other factors. To those concerned about burgeoning population and its impact on food production, Lal says, “Apart from the few Green Revolution States, much of the agricultural growth in India has been induced by population growth.” So much for Malthus.

Columnist Sauvik Chakraverti argues that population growth causes prosperity and urbanisation and free trade are suited to absorb the diverse potentials of the increasing numbers. “The proof that population causes prosperity can be condensed into four words: Urban Areas Are Rich,” writes Sauvik.

Indeed, there is a very good correlation between rates of urbanisation and economic wealth, in India as well as internationally. On the other hand, there is hardly any relationship between population density and economic wellbeing. Today, Japan and India have comparable population densities, but there is no comparison between the two economies.

Traditionally, people have always tried to crowd together in order to maximise the benefits of trade and exchange. In fact, if today's six billion people could be placed together approximating the population density of, say, Singapore (5000 people per sq. km), they would fit in to an area about one third of India. And the world would be a much richer place with abundant land and resources to sustain a cleaner, greener, and healthier world.

Nicholas Eberstadt, a political economist, identifies the ideology that has been at the root of the belief that population needs a public policy to restrain it from proliferating. He cautions, "To make the economic case for an active population policy, population planners would ultimately need to centre their arguments on estimates of the economic value of human life. They would have to show, in effect, what would be the "present value" of a child born today, and also to show how that present value would be changed by altering the size of the baby's cohort of peers, or the cohorts following." Eberstadt also points out that demographic change may assume a variety of manifestations, its form in the modern era has typically been both comparatively benign and relatively advantageous for the purposes of economic growth.

The implications of demographic change are not restricted to the economy alone. For instance although the rate of population growth is slowing, due to falling birth rates, the absolute annual increase is still near its historic high of 86 million a decade ago because there are so many women and men of childbearing age. Over 95 per cent of growth is in developing countries.
Consequently, In 1960, Europe had twice as many people as Africa; by 2050 it is estimated that there will be three times as many Africans as Europeans. Asia, by far the most populous region, has more than doubled in population since 1960, as has Latin America and the Caribbean. Meanwhile, population growth has slowed or stopped in Europe, North America and Japan. The United States is the only industrial country where large population increases are still projected, largely due to immigration.

Clearly, the declining share of the European-Caucasian is likely to affect many other spheres of political and economic life. This raises the prospect of other possible agendas playing a role in shaping the debate over of population. Even The Wall Street Journal has recognised that “[T]hough the talk about reducing population is couched in terms of individual ‘freedom’ and ‘choice,’ …..the context of these choices is a world where more babies—especially yellow, brown and black babies—is thought to be a scourge that threatens the well-being of everyone.”

As Bauer says, "The central issue in population policy is whether the number of children people have should be decided by the parents or by the agents of the state." In the present era of globalisation and democraticisation, this issue assumes added significance. Because at a time when there is a general recognition of the people's freedom to choose their political representative and pizzas, or between their colas and the cars, any attempt to deny people the choice over the size of their family will heighten the anomaly.

The fundamental issue as we enter the new millennium is should we consider our fellow human beings as a resource and shape policies that protects his freedom, or should we look at our numbers and think of it as a drain on our limited resources.

In a small way, this book seeks to reopen this debate. We would achieve our aims, if these few essays help to introduce the reader to a different perspective. The human population is the ultimate resource and not the problem. Rather than blaming the people, we should look at our policies that have curbed the spirit of inquiry and enterprise, and led to the wastage of the most precious of all resources, the human mind. We hope this book will succeed in expanding the scope of the population debate. Our future and those of our children depend on it.