Libertarian Perspective : India’s Wealth Redistribution provisions under Article 39

By Vaibhav C Anil, Local Coordinator 2017-18

India – Article 39 – Certain Principles of Policy to be followed by The State

The State shall, in particular, direct its policy towards securing –

• that the citizen, men and women equally, have the right to an adequate means of livelihood;

• that the ownership and control of the material resources of the community are so distributed as best to subserve the common good;

• that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment;

 Sub clause (b) of this law, which comes under the Directive Principle of State Policy, means that the state can control and centrally plan in what proportions the material resources that exist within its jurisdiction can be owned by the people. Sub clause (c) of this law means that the government can engage in wealth redistribution if the distribution of wealth at any point in time doesn’t comply with what the people who run the government feel it ought to be.

This provision performs very poorly with respect to the ideals of individual liberty. Although, such a provision might seem attractive to people who are easily fooled by demagoguery, a more academic analysis would prove that it actually acts against the best interests of every citizen being governed by it.

There exists infinitely many ways in which all the material resources and wealth in a society can be allocated amongst its citizens. The challenge is to find the combination from all the different permutations and combinations that best promote the common good.

Imagine two societies A and B. In society A, a 1000 people try to plan who owns what, from among the 1 million people of the society.

In society B, however, a whole 1 million people try to plan the economy of it’s 1 million citizens in a one on one relationship. On top of that the planners have all the information they can possibly have of their respective constituent, and the planners themselves have zero needs be it food, clothing, money etc.

Which of the two centrally planned societies do you think will better serve the common good? Society B will be better simply because there are more people doing the planning and much more information is available to the planners.

Society B of this thought experiment functions like a free market economy, with the central planners getting replaced with the individual minds of the people who are part of the system. The point is, no amount of central planning can realistically match the cooperative prowess of capitalism when it comes to bettering the life of the people. Dare I say, capitalism is the system of the people, by the people and for the people.

The only way to redistribute wealth is to destroy the incentives to have wealth in the first place i.e. if people know that whatever wealth they earn will have a portion of it taken away by force, they wouldn’t produce as much value to society as they would have under a free system.

Which means that if you continue to infringe upon property rights of the citizens the society would soon run out of property as nobody would be creating anything new. History is a witness to that fact.

We can also tackle this at a moral level. The wealth a person owns under capitalism is essentially the energy that was once in their body which they turned into property via a series of mutually consensual exchanges involving labor and trade.

Now, should it be legal for someone to connect a tube to your body and extract your energy without your consent? Absolutely not. It is morally wrong to infringe upon someone else’s property without their consent, since their property is a material representation of the energy.

They have the natural right to prevent anyone else from taking their property the same way they have a natural right to prevent anyone else from taking their energy.