Politics and Economy

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THE RECENT GLOBAL MELTDOWN OF INDIAN ECONOMY
The year 2008, one of the worst years in the world’s economic history, experienced a major global meltdown. This global meltdown led to job lay-offs across the world. The global meltdown is not only affecting the services sector, even the industrial sector has been affected adversely. Major projects and expansion plans are being reviewed by the corporate sector and they have started focusing on reducing costs and borrowings.

The first half of the year 2009 is considered as the worst period. Despite all these problems, the biggest problem that still exists from the past is ‘Information asymmetry’. It would be fine if our Government or the members of the major corporate sector don’t know the problem or where to find the answer, but the truth is that they know both and are waiting for other countries to take steps.

The most important challenge faced by our Government during this time is to ensure a balance between inflation and growth. If our economy experiences high growth rates, it will lead to major exports from our nation which will affect our domestic market and if economy experiences a decline in the inflation rate, it will lead to major imports to our country which will affect the government budget. India, being a free market economy itself, isn’t insulated from this turmoil.

It is evident in the sharp depreciation of rupee against the dollar and the fall in BSE sensex. FIIs are pulling out their money in huge numbers. Despite all this, India has been able to avert a major disaster. And this is only because of those very regulations which we have been denouncing as being anti-liberal. Financial sector has been advocating reforms for a long time now which means easing up of these regulations and policies. However, this time, these very policies have helped in thwarting the crisis.
In this way India has recovered from the great meltdown. But Indian economy as a whole comprises of a biggest component which is POLITICS. Politics has both negative and positive impact on every economy. But what is politics all about?

POLITICS IN GENERAL
The term politics normally conjure up illustrations of the heads of government, legislators and the government currently, and even more general undertone is the thought of corruption and sleazy dealings. The thought of concept of politics originates from the Greek word ‘polis’ indicating both an element of government and similarly the state or community all in all.
Politics is indeed present when there is a collection of people that constitute a community. Politics is said to be a set of actions or occurrences that raises questions on the community or society as a whole. Politicians are one of the key actors in the practice of politics. They formulate bills, propose policies and advocate their views on how to enhance the performance of the country’s economy. They do not have the monopoly of employing politics as a means of carrying out things. The main moves and predominant actor in employment of politics is the people in general. The public is capable of making changes based on their perspectives on how things should be carried out.
Politics takes place in all types of communities and is at hand as an essential means to steer clear of conflict because of multiplicity of belief and opinion and therefore required to uphold as peaceful and subsistence as possible. Politics is itself a contradiction in terms of being at its extent, very complicated.

POLITICS IS A WAY OF GENERATING A MORE CONTROLLED SOCIETY.
POLITICS IN INDIA
India is one of the largest democratic countries in the world. India provides the biggest number of provisions to the people of this country. These provisions include franchise rights and the largest number of political parties. The percentage of the population that votes for the periodical elections was high previously but has depleted in recent times. Elections are held at different strata. The two important governments that are formed after the elections are the national level elections and the state level elections. The economy and politics of India have interested people all over the world.

Politics was feudal establishment in India before 70s. Congress was the superman in the system. Indian population was away from that untouchable system. After 70s, particularly late 70s, things changed. Congress party itself made some changes. But the autocratic mentality didn’t change much.


POLITICS AND ECONOMY
It may be that wary beasts of the forest come around to accepting the hunter's trap as a necessary concomitant of foraging for food. At any rate, the presumably rational human animal has become so inured to political interventions that he cannot think of the making of a living without them; in all his economic calculations his first consideration is, what is the law in the matter? Or, more likely, how can I make use of the law to improve my lot in life? This may be described as a conditioned reflex. It hardly occurs to us that we might do better operating under our own steam, within the limits put upon us by nature, and without political restraints, controls, or subventions. It never enters our minds that these interventionary measures are placed in our path, like the trap, for purposes diametrically opposed to our search for a better living. We automatically accept them as necessary to that purpose.

And so it has come to pass that those who write about economics begin with the assumption that it is a branch of political science. Our current textbooks, almost without exception, approach the subject from a legal standpoint: how do men make a living under the prevailing laws? It follows, and some of the books admit it, that if the laws change, economics must follow suit.

It is for that reason that our college curricula are loaded down with a number of courses in economics. That there is a science of economics which covers basic principles that operate in all our occupations, and have nothing to do with legislation, is hardly considered. From this point of view it would be appropriate, if the law sanctioned the practice, for the curricula to include a course on the economics of slavery.

Economics is not politics. One is a science, concerned with the immutable and constant laws of nature that determine the production and distribution of wealth; the other is the art of ruling. One is amoral, the other is moral. Economic laws are self-operating and carry their own sanctions, as do all natural laws, while politics deals with man-made and man-manipulated conventions. As a science, economics seeks understanding of invariable principles; politics is ephemeral, its subject matter being the day-to-day relations of associated men. Economics, like chemistry, has nothing to do with politics.

The imperviousness of economic law to political law is shown in this historic fact: in the long run every state collapses, frequently disappears altogether and becomes an archeological curio. Every collapse of which we have sufficient evidence was preceded by the same course of events. The state, in its insatiable lust for power, increasingly intensified its encroachments on the economy of the nation, causing a consequent decline of interest in production, until at long last the subsistence level was reached and not enough above that was produced to maintain the state in the condition to which it had been accustomed. It was not economically able to meet the strain of some immediate circumstance, like war, and succumbed.

Preceding that event, the economy of society, on which state power rests, had deteriorated, and with that deterioration came a letdown in moral and cultural values; men "did not care." That is, society collapsed and drew the state down with it. There is no way for the state to avoid this consequence — except, of course, to abandon its interventions in the economic life of the people it controls, which its inherent avarice for power will not let it do. There is no way for politics to protect itself from politics.
"The evidence is that economics influences the character of politics, rather than the other way around."
 
THE RECENT GLOBAL MELTDOWN OF INDIAN ECONOMY
The year 2008, one of the worst years in the world’s economic history, experienced a major global meltdown. This global meltdown led to job lay-offs across the world. The global meltdown is not only affecting the services sector, even the industrial sector has been affected adversely. Major projects and expansion plans are being reviewed by the corporate sector and they have started focusing on reducing costs and borrowings.

The first half of the year 2009 is considered as the worst period. Despite all these problems, the biggest problem that still exists from the past is ‘Information asymmetry’. It would be fine if our Government or the members of the major corporate sector don’t know the problem or where to find the answer, but the truth is that they know both and are waiting for other countries to take steps.

The most important challenge faced by our Government during this time is to ensure a balance between inflation and growth. If our economy experiences high growth rates, it will lead to major exports from our nation which will affect our domestic market and if economy experiences a decline in the inflation rate, it will lead to major imports to our country which will affect the government budget. India, being a free market economy itself, isn’t insulated from this turmoil.

It is evident in the sharp depreciation of rupee against the dollar and the fall in BSE sensex. FIIs are pulling out their money in huge numbers. Despite all this, India has been able to avert a major disaster. And this is only because of those very regulations which we have been denouncing as being anti-liberal. Financial sector has been advocating reforms for a long time now which means easing up of these regulations and policies. However, this time, these very policies have helped in thwarting the crisis.
In this way India has recovered from the great meltdown. But Indian economy as a whole comprises of a biggest component which is POLITICS. Politics has both negative and positive impact on every economy. But what is politics all about?

POLITICS IN GENERAL
The term politics normally conjure up illustrations of the heads of government, legislators and the government currently, and even more general undertone is the thought of corruption and sleazy dealings. The thought of concept of politics originates from the Greek word ‘polis’ indicating both an element of government and similarly the state or community all in all.
Politics is indeed present when there is a collection of people that constitute a community. Politics is said to be a set of actions or occurrences that raises questions on the community or society as a whole. Politicians are one of the key actors in the practice of politics. They formulate bills, propose policies and advocate their views on how to enhance the performance of the country’s economy. They do not have the monopoly of employing politics as a means of carrying out things. The main moves and predominant actor in employment of politics is the people in general. The public is capable of making changes based on their perspectives on how things should be carried out.
Politics takes place in all types of communities and is at hand as an essential means to steer clear of conflict because of multiplicity of belief and opinion and therefore required to uphold as peaceful and subsistence as possible. Politics is itself a contradiction in terms of being at its extent, very complicated.

POLITICS IS A WAY OF GENERATING A MORE CONTROLLED SOCIETY.
POLITICS IN INDIA
India is one of the largest democratic countries in the world. India provides the biggest number of provisions to the people of this country. These provisions include franchise rights and the largest number of political parties. The percentage of the population that votes for the periodical elections was high previously but has depleted in recent times. Elections are held at different strata. The two important governments that are formed after the elections are the national level elections and the state level elections. The economy and politics of India have interested people all over the world.

Politics was feudal establishment in India before 70s. Congress was the superman in the system. Indian population was away from that untouchable system. After 70s, particularly late 70s, things changed. Congress party itself made some changes. But the autocratic mentality didn’t change much.


POLITICS AND ECONOMY
It may be that wary beasts of the forest come around to accepting the hunter's trap as a necessary concomitant of foraging for food. At any rate, the presumably rational human animal has become so inured to political interventions that he cannot think of the making of a living without them; in all his economic calculations his first consideration is, what is the law in the matter? Or, more likely, how can I make use of the law to improve my lot in life? This may be described as a conditioned reflex. It hardly occurs to us that we might do better operating under our own steam, within the limits put upon us by nature, and without political restraints, controls, or subventions. It never enters our minds that these interventionary measures are placed in our path, like the trap, for purposes diametrically opposed to our search for a better living. We automatically accept them as necessary to that purpose.

And so it has come to pass that those who write about economics begin with the assumption that it is a branch of political science. Our current textbooks, almost without exception, approach the subject from a legal standpoint: how do men make a living under the prevailing laws? It follows, and some of the books admit it, that if the laws change, economics must follow suit.

It is for that reason that our college curricula are loaded down with a number of courses in economics. That there is a science of economics which covers basic principles that operate in all our occupations, and have nothing to do with legislation, is hardly considered. From this point of view it would be appropriate, if the law sanctioned the practice, for the curricula to include a course on the economics of slavery.

Economics is not politics. One is a science, concerned with the immutable and constant laws of nature that determine the production and distribution of wealth; the other is the art of ruling. One is amoral, the other is moral. Economic laws are self-operating and carry their own sanctions, as do all natural laws, while politics deals with man-made and man-manipulated conventions. As a science, economics seeks understanding of invariable principles; politics is ephemeral, its subject matter being the day-to-day relations of associated men. Economics, like chemistry, has nothing to do with politics.

The imperviousness of economic law to political law is shown in this historic fact: in the long run every state collapses, frequently disappears altogether and becomes an archeological curio. Every collapse of which we have sufficient evidence was preceded by the same course of events. The state, in its insatiable lust for power, increasingly intensified its encroachments on the economy of the nation, causing a consequent decline of interest in production, until at long last the subsistence level was reached and not enough above that was produced to maintain the state in the condition to which it had been accustomed. It was not economically able to meet the strain of some immediate circumstance, like war, and succumbed.

Preceding that event, the economy of society, on which state power rests, had deteriorated, and with that deterioration came a letdown in moral and cultural values; men "did not care." That is, society collapsed and drew the state down with it. There is no way for the state to avoid this consequence — except, of course, to abandon its interventions in the economic life of the people it controls, which its inherent avarice for power will not let it do. There is no way for politics to protect itself from politics.
"The evidence is that economics influences the character of politics, rather than the other way around."

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