Garibi Hatao, Tax Badao

The brouhaha over Rs. 32 setting the poverty line in India heralds a return to classic socialist idiocy. But then again you shouldn't be too surprised at such idiocy in India. After all, shaking off an embedded socialist welfare psyche isn't easy because of two reasons. One, cultivating economic sense in a welfare state isn't easy. Two, from a psychological perspective the welfare state idiocy makes people feel like they are the caring kind.

Lets for a moment suppose the poverty line were raised to a higher rupee level. The result would be greater 'people numbers' in the poverty bracket. Pray, who will then feed, clothe, and care for these enhanced numbers? Of course government, the socialists will clamour. Pray when has government ever fed and cared for the poor? Remember the Indira Gandhi times, when taxes were at its highest, and 'Garibi Hatao' was loudly bandied around? What happened? The poor remained dirt poor! The well off and the salary earners paid sky high taxes that did nothing for the poor, and everything for those in government!

Fast forward to now. Despite the oft quoted lie that the rich have gotten richer and poor have gotten poorer, what's real is everyone's lot has only gotten better. Agreed, the creamy layer has zoomed up faster and to a greater degree vis-a-vis those below, but everyone's RELATIVELY better off! No thanks to government, all thanks to lesser government. Those sectors that have loosened on government control have fared way better for people associated, either as producers thus wage earners, or as consumers thus wage spenders.

Ponzi Government schemes feeding off tax payer money and easing poverty is a pipe dream. It hasn't, and won't happen. What instead will set off lowering of poverty will be easing of government control, and letting private sector create jobs that come out of acts of commercial value creation. Put a spoke in the wheels of private enterprise and I guarantee, you won't ever wipe out poverty. A raise from a base level of 32 rupees so more people can be called poor also won't help.

Even a bit.