Tuesday, August 23, 2011

Natural Law

What is typically described as natural law has had a long history in  philosophical thought. It gained particular prominence during the Age of Reason and Enlightenment of the 17th and 18th centuries and was linked with development of democracy, individual rights, and political freedom. It is a notion that was advocated  by the religiously-minded Thomas Aquinas several centuries earlier as by other, more secular philosophers and nation builders later, like John Locke and Thomas Jefferson.  It had a  tremendous impact upon the revolutions and upheavals  during the period and this can be seen in its influence on British politics and law, French Bill Of Rights, and the United States Constitution.  The natural law  holds, in one form or another,  that all men have an inherent right to be free and pursue life and liberty.

The key point to note here is that, the natural law is understood as something fundamentally distinct from any particular human-created jurisprudence. Its origins are meant to lie in human nature itself, and it is believed to be true regardless of the period of human history or the location of the people to whom it is applicable.  In other words, it is considered on the same footing as laws of physics.  The doctrine claims that, being a part of nature, human beings behave and act according to a certain set of laws.  Just as copper has certain properties owing to its nature, so do human beings. This, we must believe, is self-evident and no further explanation is required to justify it. It is often held that natural law prescibes actions that maximize happiness as Sir William Blackstone explains," .. demonstrating that this or that action tends to man's real happiness, and therefore very justly concluding that the performance of it is a part of the law of nature ".No mention is ever made of the fact that one man's happiness could potentially cause harm to another. Furthermore, the advocates of this theory posit that the rights that follow from them are just as inviolable (according to the decree of nature).  Quite clearly,  all this is a steaming pile of nonsense.

First off, the comparison of human beings to copper is egregious: we are fundamentally different from inanimate objects for the simple reason that properties of copper are well-defined and constant. Human beings, on the other hand, are very complex products of nature, who behave radically different from each other under similar circumstances and appear to demonstrate choice in actions. Comparing us to copper or lead is baseless. More importantly, given how complex we are, there is absolutely no physical law that applies to our actions even at an qualitative, approximate and coarse-grained level. That is a scientific fact and not merely my opinion.  Thus everything all these philosophers have said under the guise of naturalness is not based on any scientific methodology but involves either some form of divine prescription(the religious ones) or vague speculations(for those who have no such excuses). 

However to see the utter foolishness of this idea, such established scientific truths are an overkill. The most basic question that comes to mind when faced with such a sweeping declaration is how to account for those innumerable cases where these are not true.  How do we explain the oppression of people, murder of innocents and discrimination against certain groups if nature encoded every individual to just pursue life and liberty. Why would colonies have to fight a revolutionary war and declare independence from a supposedly oppressive empire? What empirical evidence do we have that nature has granted anything resembling such rights? The fact that some privileged folks had the time and leisure to babble such nonsense?  What does nature care if you are poor and your life is nasty, short and brutish? Or, you were dead a few minutes after birth owing to several medical complications? Does nature prevent you from being condemned to enslavement for eternity, not having experienced even a whiff of free "life" so grandly stated in the U.S Declaration Of Independence? Aren't these the realities of the world inhabited by those who made such grandiose proclamations. Perhaps, a certain clause that beneficiaries of nature were meant to be  rich white men was implied (after all, who else matters?).

Its intellectual absurdity becomes even more apparent when you consider the fact that proponents of the concept of natural laws further insist  that we must defend these rights? What is the need for defending something if  natural state of affairs conforms to the desirable situation (by definition of natural law)?  Why does the question of defending such liberties arise when human nature never would transgress it?  It is incredible that such cognitive dissonance that is immediately apparent has never registered in the proponents of this Utopian doctrine.  Why set up a government, a system of politics with laws and regulations, and bodies to enforce them, and punish the violators when human nature is naturally good and favors liberty and freedom.

Perhaps I am being overly critical. Maybe a more limited interpretation of the natural law can be regarded as being closer to the truth.  What if the natural law is to be understood as human tendencies, rather than rights, to want to be free and enjoy life and pursue happiness?  Initially, this re-characterization sounds a lot more reasonable. Until of course, you realize there are other less benign human tendencies as well.  In all cases of tyranny, exploitation and massacres  the inclinations of man -greed, egocentric-ism, callousness,vengefulness, domination and power - emerges to destroy such hypothesis.  Evidence does not support the likely defence that we should ignore the latter as mere aberration to the deep inherent goodness of man.  If anything,the record of human history is mixed: indications of good behavior often being side to side with examples of cruelty, destruction and horror being as much a human story as love and kindness are.  Considering these facts, natural law looks like a really uneven fit with the data.

And yet, the law itself - and the rights derived from it  - is anything but nonsensical. In fact, they are some of the most basic foundations on which much of the progress of civilizations has occurred over centuries.  And they do sound like good principles to start building a society and government upon. Except they are not natural, not even close. Acknowledging this would fundamentally alter the very significance of them. Framing it in its original language gave it a veneer of universalism. That was sufficient justification to not question its supreme status in the theory of ethics.  After all, if these laws are not natural, then what is ethics based upon?   The religious have a simple, direct answer to this question but it is wholly unsatisfactory to those who do not share their faith.  Most secular people don't ever  get this far to question the basis of their ethical framework. Most  likely, the response will be some platitudes and appeals to nature, abusing whatever little they know of evolutionary psychology and anthropology along the way.

 I should stress that I see this as an extremely crucial dilemma as this represents my starting point for the argument for expanding our circle of consideration to include sentient animals. The way I understand this is to first admit that, yes, from the strict point of view of nature, these "natural laws" are as arbitrary as any other.  Nonetheless,I contend that these laws seem the most reasonable and fair for everyone concerned. A fair compromise is implicitly involved in the trade-off between enjoying certain liberties while being prohibited from encroaching on those of others.   The same record of human history will show that all societies and cultures have always placed significant importance on being fair (even if that applies to a very narrow group) and human bonding and a concern for the welfare of others(again, narrowly applied to a subgroup) is also a common trait.  The philosophy of ethics, under which the "natural" laws are stated, argue that these considerations should be  expanded to all human beings.  And indeed, the sphere of consideration has shown enormous progress is different societies, starting from kith and kin, to tribe,moving to the village, the state and kingdom and sometimes even cutting across ethnic, cultural and geographic boundaries. At the same time, these liberties cannot be taken for granted, something that is again obvious glancing at the darker portion of human history and examples where even members of your family can turn against you.  Hence, there has to be an external mechanism to protect these liberties and the means to enjoy a good life. 

It is in this context that one has to understand animal rights. Lots of people demonstrate an inherent aversion to wanton cruelty to animals. And yet they suffer from cognitive dissonance and continue to be full participants in the industry that is responsible for unfathomable amounts of the same. The reasonable thing to do here is to recognize the interests of animals and duly accord them proportional rights. At the very least, they cannot be used as products for our benefits.

Tuesday, August 16, 2011

The appetite for American dollars

Amidst all the discussion, analysis, forecasts and alarm surrounding the credit downgrade of the United States,the soaring national debt  and potential default, an  obvious question is never being asked by anyone in the mainstream media establishment.  Why would any government want to hold onto US debt in the first place? This question is almost never addressed directly although issues surrounding it such as concern over foreigners funding America's consumption, debt-fueled spending and dangers of the possible run on the dollar are reported and discussed (even then, either incorrectly or hysterically or both). The explanation for this has to do with the fact that exploring that question and reaching to its logical conclusion would reveal the full extent of American economic imperialism for over 60 years and the rigging of the entire global reserve system around the dollar.

The question is so plainly obvious that it is conspicuous by its absence in any public debate. Why would any foreign nation want to stack up on Treasury securities when their yield is so low? All the more baffling when you consider that several under-developed and developing nations that are otherwise strapped for money have considerable dollar-denominated reserves piled up. Imagine if these nations could invest the same amount of money into a lucrative business, they could use the profit earned to fund domestic social services like healthcare and education. Why would a government not choose that more profitable option or alternately, use that same reserve for important developmental projects at home?  During those really rare occasions that this issue is considered in the mainstream American media, the usual explanation that is provided points to the fact that the US government debt is a safe haven for all investors. To bolster this position, we will be informed that at times of severe crisis and market shocks,such as, for example the collapse of Lehman Brothers and other large financial firms in August of 2008, investors were rushing to hoard Treasury notes because of their perceived low risk. The same pattern was observed, most oddly, immediately after Standard and Poor announced the downgrade of US debt recently.  There is, undeniably, a grain of truth to this claim but like so many other simple-minded blanket  explanations this still does not account for how willing governments to pay for America's extravagant ways (with so little ostensible benefit).

Bretton Woods System

The real answer goes back all the way to 1944 and to a small town in New Hampshire where the major Allied powers set out to lay the foundation of the future global economic system.   With the country clearly emerging as far and beyond the most powerful economic power whose future domination was obvious, the United States was able to structure the international financial system to its immense benefit.  The scheme that was developed, called the Bretton Woods system, had the United States dollar as the the primary currency with respect to which the exchange rate of the other countries were fixed.  The dollar itself was pegged to the gold standard and in return for this agreement the US promised to exchange dollars held by any nation  within the system to an equivalent amount of gold. To coordinate and maintain this global economic system, the International Monetary Fund (IMF) was established which was stated to provide assistance to distressed nations in the form of debt relief or to offset balance of payment and provide counsel wherever required. Every country had a quota in the IMF and with the United States having more than one-third of the total, it had to ability to veto any decision taken by the institution. In little or no real position to negotiate a better settlement, most countries accepted this proposal and although Britain was reluctant to let its position of pre-eminence slip away, the reality of its financial dependence on Washington for several decades into the postwar period made it acquiesce to the demands of the new imperial hegemon. Moreover, the sheer economic power of the United States was able to override any voice of concern that might have been raised amongst the 40 odd nations gathered there. That pact guaranteed American economic hegemony throughout the world. The dollar, which, at this point, was the only currency still convertible to gold, was stipulated to be the global currency; it was the most "liquid" asset with the highest demand, and consequently, the safest bet.  As part of the agreement all the nations were expected to open up their markets for trade which gave the US the full coverage of regions that had previously adopted a more protectionist stand. However, capital controls were not only allowed but were recommended. 

Consolidation and Stability (1945-1972)

In the few years following the Bretton Woods agreement, with Europe devastated by the war and its foreign reserves exhausted, it became an unfavorable situation where the US had plenty of surplus and instead of the dollars entering the international arena (as was desired under the system), it stayed at home predominantly. While the reason why Washington benefits from having the dollar as the global currency today is because it allows deficit-spending, in late 1940s when nearly half of the world's production was within its borders, it was the reverse: the US wanted to get rid of the surplus. This  Atlantic divide was known as the "dollar gap" and in order to reverse this trend, and also to improve Europe's industry and welfare and prevent it from succumbing to anything that scented of left-wing sympathy,   the Marshall Plan was proposed under which Washington would assist European countries with several billion dollars in aid.  In the next few years, partly because of the Marshall Plan, partly due the reversal of the policy to dismantle the German industrial capacity(again, delusions of Soviet influence), and partly because of many other internal factors, Western Europe recovered, its industries restored, its economy revitalized and its currencies strengthened. By the middle of 1955, dollars were copiously flowing out of the United States, and European exports (particularly German) were doing very well.  In fact, much to the consternation of American financial leaders, an independent Euro-dollar market was established which basically traded the dollars and dollar-denominated assets outside of American regulatory authority. This was a period marked by tremendous prosperity in the West with low inflation, low unemployment, increased economic stability and high standards of living. However,by 1959, the opposite problem was becoming the main concern, with lot more dollars circulating outside the US than what America could support with whatever gold reserves it held.  The situation became increasingly untenable and culminated in 1972, when President Nixon announced that the US would no longer back the dollar with gold. That marked the collapse of the original monetary arrangement and from that time onwards, the only "backing" for the dollar was the trust of the United States government and the size and stability of its economy. This ushered in an era of fiat currency and floating exchange rates which led to greater instability and fluctuations. Nonetheless, the dollar still remained, by inertia alone, as the global reserve currency and its demand strong as ever.

Global Economic Order 1972-

When a particular currency has established itself as the primary exchange for international trade, commodity pricing and adjusting exchange rates, it becomes imperative for every nation to maintain a sufficient reserve of that currency. Why would that be so? Imagine a situation where a small country is struck by a famine and needs to import food for its starving population. The reserve currency is required to make such purchases without jeopardizing the domestic economy. Likewise if a nation's currency  is falling, the standard move is for the central bank to sell the reserve currency and purchase the domestic currency thereby increasing demand for the latter. Conversely, if the value of the domestic currency is appreciating, the central bank would have to sell the domestic currency and the reserve currency is typically purchased in return.  Settling debt with the reserve currency would prevent any unforeseeable negative consequences to the domestic economy. Such concerns underlie the desire to hoard reserve currency even by the poorest of nations despite the fact that the interest rates are so low.  The natural question one may ask is why the euro or the yen is unable to take up that role. This is because although a significant amount of reserves are held in euros, the dollar still dominates the international markets and most commodities(especially oil) are priced in dollars and most currencies are pegged to the dollar. My answer sounds like question-begging but the real point to note here is that once something acquires the market share in the world that the dollar has done it is very difficult to displace it from that position.  Also, EU has never been very happy with letting the euro reach the hands of investors far from the eurozone (this was true ever before Irish, Portuguese, Spanish and Greek problems brewed). The Bretton Woods system was so formulated with this intent precisely in mind- securing the global hegemonic role of the dollar and thereby the United States.  With the US running deficits for the last 15 years or so, cheap credit has always been the order of the day because foreign governments are more than willing to buy Treasury paper. Even with the debt growing stupendously, having to fund imperial wars of aggression and invasion and making up for the refusal of both the corporate parties  to tax the rich, countries are willing to lend money for next to nothing. This situation clearly exposes the unfairness and ridiculousness of the global reserve system. Even on the face of it, it should be odd that that a single country's domestic currency  also functions as the global currency. Having rigged it this way, such problems are of course, inevitable.

Much like the Euro-dollar market in the 1960s, this form of economic dominance can unexpectedly be a double-edged sword for Washington. The case in point here is China. The latter holds more than a trillion dollars in US debt, and unlike several other nations, it is not for any specific emergency. The primary motivation for buying up the dollars is to prevent the yuan from appreciating. That way China can ensure its exports remains competitive and under free market trade agreements, the US domestic market is flooded with Chinese goods (a case of defeating you at your own game). With this mutually dependent(and simultaneously unfair)relationship between the superpowers at the background, the accusations that they level at each other is a complete farce. Despite all the bickering about Chinese manipulating currency, the last thing America wants is for China to call in its debt, which will surely shake the very foundations of the global economic order. Likewise,China will not stop buying US debt because the the US is the greatest consumer for its products. During the start of financial crisis in 2008, the decrease in exports led to unemployment problems for China and the last thing Beijing wants is a restive population demanding for political reforms and freedoms.  Hence the stalemate and the status quo and the downgrade is going to do nothing to change it, just as the Beijing and Washington annually sending critical reports of human rights condition to each other does little to change the multitude of abuses in either.

Where does the world go from here? Nobody really knows. Any reasonable analysis of the prevailing situation taking into account how such entrenched global standards -like eating meat and abusing animals, to quote another example - refuse to go away despite uncovering all the irrationality and destruction associated with it. It is of course, incredibly surprising how little all this gets mentioned in the media. The amount of loss accrued from accumulating Treasury papers more than outweighs any benefits from the US aid including those that come with the political conditions duly attached. The ethnocentricism and conservatism of mainstream American media prevents any honest discussion and debate on this topic.  Much like  other crucial issues, the problem is never fully addressed and instead what the public hears is a completely narrow and limited perspective of it.

Wednesday, August 3, 2011

Capitalism vs Communism

Capitalism vs Communism

The above comparison stands alongside other dichotomies such as good vs evil,God vs Devil, victory vs defeat, with us vs against us, as a notorious example of framing a debate in terms of a silly binary choice. Needless to mention, this approach is incredibly wrongheaded not merely because it does not consider a third alternative, but more importantly, confines you to think about the issue in very narrow terms. It already establishes a narrative for confronting the original issue that led to this false choice being presented as a genuine option. Of all these misleading binary divisions, this one is amongst the most dangerous of all in the modern political milieu.

Why must it this be so? To begin with, it is really asking you to make a choice between two economic systems (strictly speaking, one is also a political system) without addressing what the basic motivations are? Imagine if you knew nothing about the history of the world, or the economic paradigms that have existed, but you have some basic sense of what is right and wrong (yet another dichotomy!), and if faced with a choice as this, how would you react? Most certainly with confusion and bewilderment. What must be even difficult to understand is how people are able to declare their allegiance to one over another without much thought to how it actually relates to the basic questions of right and wrong. What are the reasons behind their ideological inclinations. Either they find one or the other appealing as an economic system, or they use history as evidence to choose between the two. It is very important to observe here is that these two approaches are almost completely unrelated to one another i.e the theoretical foundations of the politics and economics that are espoused by these systems is very different from what their actual realizations were. That is not taking into consideration the various strains of thought and varying ideas - sometimes leading to contradiction- that exists even at the theoretical level. Thus, if historical examples are compared to determine political orientations, then the debate is about the realizations of these ideological systems and not their original formulations. Then we have already stepped away from thinking through from basic principles about what is the best system to adopt and merely used the historical precedents to arrive at a decision. I consider this an intellectually lazy attitude that fails to question the basic mechanisms behind the structure that built on (ostensibly) these ideological systems. But, as some defenders of such thinking will will argue, the principles, ideas, and guidelines laid out by their respective political philosophies will, inevitably, naturally lead to the kind of monsters that we normally associate with them. This is untrue.

Capitalism, as an economic system in theory(and whatever liberal-democratic political philosophy it accompanies) , does not require or accept sweatshop labor as a fair system just as communism as a theory does not call for forced labor camps to send dissidents. Neither does capitalism - as a political philosophy, again- ignore environmental destruction regarding it as a burden for future generations to be worried about nor does communism suggest ignoring victims of famine and callously allowing millions to perish. Capitalism does not call for integrating the economic system with military imperialism or any other asymmetrical relationship enabling domination and oppression of the weak. In much the way communism does not require every singly political party in the world to abandon independent policy and follow the line of some megalomianiacal leader. Capitalism does not imply state corporatism and communism does not imply bureaucratic nightmare. Capitalism does not demand violently crushing labor movements and communism does not demand complete censorship. Capitalism does not require state terrorism to impose its system elsewhere and communism does not need agent provocateurs and propaganda to sustain it. Inequality does not follow from capitalism much like economic stagnation does not follow from communism. Capitalism does not need right wing dictators maintain order and likewise communism does not require their - equally brutal - "left wing" counterparts. The principle of "invisible hand" does not imply (according to Adam Smith, mind you) leave-everything-to-the-market-and-we'll-all-be-happy-ever-after and "dictatorship of the proletariat" was never meant to be understood as we do so today. Capitalism does not promote individualism anymore so than communism. The list goes on...

It is simply unquestionable in the light of these facts that we have to separate the theoretical underpinning of these philosophies from the real-world materialization of political and economic systems either devised by individuals or organizations at their inception and/or metastasized into the complex forms they have assumed. If of course we refuse to be confused and dismiss these false associations, then the only other rational way to choose one system over another is for us to consider their basic premises, their various assumptions,the arguments and reasoning that are employed to construct a social, economic and political theory based on those premises. All of this comparison is meaningful only if, at the end, it complies with some core principles. What would those core principles be? Would it be the "liberty" to drive a gas-guzzling vehicle when it is responsible for speedy destruction of the environment and depletion of limited natural resources? Would it be that education and basic health services must be available only to those who can afford them? Would it be the principle that the market should always determine the wages even if those wages are criminally low and creates enormous disparity in wealth? Or, on the other hand, do you want a giant bureaucracy that involves inefficiency and waste? Do you want the state to adopt a completely protectionist policy and ban all imported goods ? Do you want hard-earned money to be simply given away to maintain that same bureaucracy? Do you want to navigate through tons of regulation before you get an innovative idea to translate to a successful enterprise? The answer, I hope to ALL, is no. What do we want then? Although there will always be disagreements, we can spell out a few of what these core principles are. These include upholding fairness and justice for all and protection of fundamental liberties. Just to be clear, what I have stated in one line as some unambiguous fact, has been extensively debated by philosophers, political scientists, legal theorists and economists for ages. I am not going to pretend that they all just missed some basic point. I can acknowledge that and at the same time claim that there are several cases where the reasonable and fair position is more-or-less clear. As an example is the assertion that everyone born into this world has equal opportunities (or, more accurately, equal consideration). This is an ideal that has found universal acceptance and you will hear lip service to that even from the worst tyrants on this planet. Now consider a situation - a fairly common one - where we have evidence that children born into families with lower socio-economic status have much fewer opportunities in their life, thereby not only violating our principle but also creating generations trapped in the same status. It would of course lead to a heated debate on what exactly the approach must be but it must be obvious that the existing situation cannot be acceptable. Consider another case - also very prevalent- where your income is taxed significantly but there is extreme secrecy about how that revenue is allocated, its accountability, oversight, and audit. The ostensible reason for taxing is the greater common good and that includes at the minimum, ensuring safety from crime and vandalism, protection of basic liberties, fending off external threats to the society, arbitrate cases of alleged violations of law. If these are the stated aims, then it is again obvious that much of the dealings of the authorities and agencies handling the public money must be open to review and answerable to the taxpayers. This would be a legitimate case where the "fairness and justice" requirement demands greater transparency. The same arguments can be furnished for secularism, civil liberties – no discrimination of racial or religious minorities, reproductive rights, consensual sexual relations with any adult and even treatment of such cases under law, freedom from arbitrary arrests and detention, assumption of innocence before proven guilty, protection of privacy, defence of free speech-, independent and free media, proper procedures for copyright, protection of environment and natural resources, long-term sustainability of projects etc. There are many more but the general idea must be clear. We need to ensure that individuals are treated as such -as entities in and of themselves,and when sacrifices are necessary for the common good, the burden must be fairly distributed. A government requiring the poor to bear the brunt of savage cuts to heal the financial health that was brought into disarray by the wealthy cannot be considered a fair society, whether it proudly calls itself capitalistic or communist. The point then is what kind of broad economic and political system must be adopted by the political entity -which can be safely assumed to be a nation-state (idealistic visions of anarchy,aside) - in order that these ends are met?And this ought to be the question you should ask and whatever narrative is constructed must be based upon these ideals, and those narratives must never assume greater importance than the ideals themselves leading to absurd abstract binary choices like "Communism or Capitalism?"

Still, it worthwhile to to consider in some more detail what the precepts of each economic system would entail in different scenarios. This would highlight even further how ridiculous it is to talk in terms of such misleading choices. A typical example of ideological posturing is taking sides on the question of free trade vs protectionism. We consider two situations: in case A, we have two nations X and Y, and X is most efficient in production of electronic goods and Y manufactures automobiles at the lower price. If we allowed free trade, then X can focus on electronics and export them while simultaneously importing automobiles from Y. Doing so would benefit both economies and we have a fine example of Adam Smith's principle. If you stubbornly reject free trade, then nobody stands to gain from it - productivity is reduced in both nations and inefficiency is being promoted. In case B, we introduce a third nation Z, which is largely an agricultural society and is able to produce food crops at the most competitive price. Now, consider free trade between Z and Y. Proceeding along the same lines as in the previous instance, we are tempted to declare that a free-trade arrangement would be best choice for both nations. However, there are other factors we have to consider that were not as important in the previous case. The amount of food crop traded for a single automobile would clearly be quite considerable. Now, depending on the size and output of the two countries, there is a good chance that this kind of agreement would lead to annual trade imbalances in favor of Y -the total value of food traded exported would be less than the value of the automobiles imported. This situation would mean that the national debt of Z would grow steadily and that make its position less powerful and vulnerable to unfair policies and practices against it. More significantly, this would imply that Z would be never develop the technology to manufacture automobiles and as a consequence not only become dependent on Y for it, but also possibly never cultivate industries that are connected with automobiles – iron and steel, material sciences, assembly line standards, research in mechanical or chemical engineering. If this status were to be maintained Z would permanently remain an agricultural country without any industrial capacity or production facility or high-tech research. Its people will have little option other than having to do the same farm work forever. Obviously, I have simplified things here to focus on an important issue - the necessity for the state to intervene and impose certain protectionist measures to develop indigenous industries. Thus, it may be necessary for its citizens to pay more for a product produced locally but it is a required sacrifice if in the long run the country needs to remain competitive in global marketplace. In other words, in this case, insisting on free trade without paying attention to the specific details of the economic structure would be impose unfair conditions between nations. These two cases illustrate that one cannot take a simple-minded universal approach and apply that unconditionally in all situations.

Another example is the debate surrounding minimum wages: is it required? Again consider two cases, one where a company can employ N workers. If the total number of people who are seeking this job is of the same order of N, say 1.5N or 2N, then it would be reasonable to assume that the wages can be fixed by the market. If in case a job-seeker is greedy and  demands more money than what is fair, then a more reasonable person will be prepared the same work for less, and that person is eventually employed. This would be a fair system for both the company and the workers. However, considers a variation where many people are out of jobs- and this can happen for any number of reasons, and so several more (say 10N) are applying for the limited number of openings available.If then the wages were to be still determined by the market, then the company can easily exploit the people's desperation and make them work for a lot less than what is fair. This situation calls for some kind of minimum wage because otherwise these market-equilibrium low wages can easily become standardized and the exploitation will continue. So we have to evaluate the conditions of the economy before we can arrive at a decision. In other words, taking an a priori position on it, without reference to empirical facts of the situations would be wrong-headed.

A third example would be regulations on businesses. Do we require them ? Like in the previous two examples, we can think of the first case where the government imposes several rules on running the business. For definiteness consider the business here is to be a  restaurant. The constraint can include entry into the market,  quality control of the food, commercial building laws, complicated liquor licenses, heavy taxes, various consumer protection laws, labor laws to protect employees, employment mandates and holding the business liable for a number of different scenarios. If that happens, there is strong disincentive to even start such a business, not least because of the paperwork, government interference and the possible bureaucracy and corruption accompanying it. This would raise the price of the food served, decrease competition, create inefficiency and generally slow down the economy. So it would be in the best interest of everyone to minimize the restrictions and even provide additional incentives for such businesses to thrive. In the second case, instead of a small family owned restaurant imagine you have a giant corporation that uses assembly line methods to produce cheap, unhealthy - possibly dangerous -fast food while polluting the environment, exploiting cheap labor, using predatory pricing to drive out competition, using economy of scale for the same purpose and effectively transforms entire eating patterns of the region -possibly entire nation and beyond- to create obesity and cholesterol problems, which increases treatment costs of the people (possibly government). What needs to be done here is obvious. But, oh wait! The smart ass free-marketer will step in, and tell me there is simple solution :you always have the obvious option of eating better food. This 'simple solution' ignores several things – possibility of said corporation outlets driving out other high-quality businesses serving better food, its cheap products obscuring quality of ingredients without full disclosure of the health risks involved, misleading promotions and advertisements and consumer's unwillingness to be worried about environmental costs or labor issues. Nothing can rein in such cancerous growth other than some control by the state. Again here, we see that we cannot employ a one-size fits all policy to regulate the economy. Empirical evaluation is key.

The same is true when it comes to globalizationas well. People are usually split between two reactionary camps: (1)globalization is an utopia that can reach the remotest parts of the world and expose them to a plethora of new possibilities or (2) globalization destroys economies, people's livelihoods, promotes neo-imperialism/colonialism. First of all, much like capitalism or communism or even a giant energy conglomerate, globalization in theory– as an idea, in and of itself – is not predisposed towards (1) or (2). It is merely a description of an global economic framework where economies of nations are integrated with each other. Just like everything else, this integration can be mutually beneficial or it can be asymmetrical or it is just more bureaucracy  or – as it mostly the case in practice – it benefits the financial elite in each of these nations at the expense of the majority. To those taking position (1), we need to point out the tremendous risks that arise from economic arrangements between small, poor underdeveloped nations and large industrialized counterparts. Large international corporations can easily bribe corrupt government officials in the third world and take complete control of a certain field where oil reserves are discovered and make immense profit out of it, without giving a penny back to the people on whose land it was extracted from (this happens regularly, by the way). On the other hand, shunning the global marketplace can be equally dangerous as globalization can enable export driven sectors to expand and can also provide a measure of economic stability by increasing valuable foreign exchange reserves.
It can also create the right environment for growth in certain sectors, which can in turn stimulate the economy and sustain it. Yet again, everything depends from case to case and holding to some rigid ideology would prove counterproductive.

The same simplified binary thinking accompanies debates on such abstractions as: privatization vs nationalization, regulation vs deregulation, supply side economics vs demand side economics,
market economy vs command economy, welfare vs no welfare, monetary vs fiscal policy etc. This way of framing questions is deeply flawed because it does not address the primary principles of fairness, justice and liberty that I have talked about. Choosing a command economy or a market economy should not be an ideological battleground and the debate should focus on reforms that can make the system more fair while curbing waste and inefficiency. Of course, there are no clear mathematical theorems  that can maximize some fairness-based utility in all situations but one thing is certain. Empirical evidence is infinitely more important than mere ideology. Macroeconomics is very complex for no reason other than the fact that there are so many factors involved, and on top of that, we have human irrationality – that makes people eat in those cheap, shitty, dirty fast food chains -that makes it all the more difficult to be prescribe correct policy. Still, if we stick to an empirical methodology and then constantly make changes to existing policy based on periodic evaluations we'll do much better than sticking to some misguided abstract thinking.

End Notes:
a. I have conflated economic system with political philosophy and that is not correct, but the context should make it clear.

b. It would be more accurate to discuss this as “capitalism vs socialism” but I just wanted to point out how ridiculously battle lines are drawn in politics and the general associations that are made.

c.China of course combines market economy with a single-party authoritarian regime and it has achieved a lot. No wonder many people who indulge in such ideological posturing don't refer to it.

d. Not everyone thinks this way but it is really pervasive.Couple of economists who I consider as being above this are Amartya Sen and Joseph Stiglitz.