Sunday, November 13, 2016

GOP vs Modi

This is Indian Prime Minister Narendra Modi's statement:
Why do we need the state? There are five main components:

.. The first is public goods such as defence, police and judiciary.

.. The second is externalities which hurt others, such as pollution. For this, we need a regulatory system.

.. The third is market power, where monopolies need controls.

.. The fourth is information gaps, where you need someone to ensure that medicines are genuine and so on.

.. Last, we need a well-designed welfare and subsidy mechanism to ensure that the bottom of society is protected from deprivation. This especially includes education and health care.

These are five places where we need government.
We do not know where Trump stands, because he has made statements on both sides of most issues; and he has no record of public office.

We do know where the Republicans stand:

1. On defence, police, judiciary - yes, they mostly agree.  However, note that they are in favor of privatizing prisons, even though the American experience so far has been that private prisons are very abusive.  After Trump's victory that has put Republicans in control, the stock price of private prison companies rose more than 40%.  (Defence companies rose by 6% or so.)

2.  On the regulatory system to control externalities that hurt others, the Republicans are utterly opposed, whether it is with the environment or with the financial system.

3. On market power, the Republicans have no desire to control monopolies.  Their hero, Reagan, dismantled much of the New Deal anti-trust controls.

4. On information gaps, this is a mixed bag; but I would rate the Republicans as mostly against the government doing anything to fix information gaps.

5. On the safety net, we know that the Republicans are against any such.

I repeat, on many of these, we don't know where Trump stands; he has made contradictory statements during the campaign, and he has no record of public office.

In any case, policy-wise, PM Narendra Modi is very explicit and clear; the situation with Trump is ambiguous, and there is utterly no basis for comparison of the two men.  It is not apples vs oranges; it is apples vs. BS.