This is an archived blog post from The Acorn.
Quite often in discussions about solutions to some of India’s myriad problems, it is not unsual for even some of the strongest proponents of economic reform to throw up the “but free-market economics cannot address that problem” argument. So what is nice about Michael Higgins’ post about the out-of-luck farmer who wants to become a city plumber is that it does not stop when it encounters this argument.
…but I doubt that even in a pure free market, the farmer would find it easy to find investors for his training.
The problem the farmer faces is a problem of collateral. Banks want something they can seize if the loan goes sour. You can’t put yourself up for collateral.
This is one area where socialism might have an edge. The socialist government can and does own everyone like slaves. They would gladly invest in the people’s skills as long as the return on those skills is merited. The government knows that there is no escaping their reach (as long as you don’t leave the country) so they will get their money eventually. But do we need government that owns the farmer to get someone to invest in his potential? Can’t the market invest in the farmer without government interference? [Read the rest at Chocolates and Gold Coins]
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