The illusion of choice

"Everything begins with choice," said Morpheus. The Merovingian looked at him, with his steely eyes and says, "Choice is an illusion created between those with power and those without."

That's a dialogue from The Matrix Reloaded, a seminal film which institutionalized the kind of computer graphics that you see in movies today. This dialogue defines what is wrong with free market capitalism. It's the illusion of choice. The smokescreen of corporate induced propaganda that promotes crony capitalism. This crony capitalism only worries about profit and not the essential element of free markets- choice. It's letting the consumer choose from the available ideas in a market place of ideas. This could be an ideology, a product, service or a political line.

The basic idea of a free market would be, no one idea or person can dominate another. They should get equal space and equal opportunity to make their case. There should be a proliferation of ideas from across the political and economic spectrum. That would mean that I as an individual would have the liberty to choose what I would do with the limited resources that I have at my disposal. The resources could be anything, like my time and my energy. But to make it simpler, let's call it money.

If money is the means of transaction, then I should be able to buy what I want with an unbiased mind and exchange that money for something that I would value. This maybe food, clothing or luxury items like a iPhone 6S or the MacBook Pro. If I am allowed to make this choice taking in only what I need from the discourse, the value of the money that I have in my hand and the incremental value that exchanging the money, say ₹ 50,000, then it would be an unbiased choice.

But what happens when this choice isn't unbiased. What if everything doesn't begin with choice as Morpheus claims it to be. Then you have an illusion of a make believe world where one's choice is only as unbiased as our ignorance. 

Take the Nairobi WTO ministerial meetings for example. India was trying to protect its farmers from excessive agricultural imports from countries which subsidize their farmers' produce and allowing India to procure food grains from farmers to feed its hungry population.

The claim of the WTO (read western developed nations) is that such a system would fly in the face of free trade and would distort world trade. The reasons given are that the food grains that India purchases from its farmers using the minimum support price and then sells them to the needy at lower prices, floods the market with cheap 'distortionist' food grains. This stock of food grains could be sold in the international market and would 'distort' trade. Well, my problem isn't with this whole line of argument.

Look at it this way. What does the subsidy do? It tells the farmer that if you produce crop A, then the government would reward him by buying the harvest from her at a pre-decided price. This is taking away the choice from the farmer to pursue his own economic well being. Well, then how do you feed a country full of hungry people? Shouldn't the government be doing something about it? That's a noble idea, but when you tie in fertilizer benefits along with the kind of crop that is grown, it doesn't allow the farmer grow the crop that he would ideally like. Mihir Sharma explains this concept in detail in his book Restart.

Countries will always pursue distortionist trade practices that would benefit their people. That's a given. But the problem arises when a sovereirgn government is forced into taking decisions based on corporate lobbies. That's distorting the element of choice that one should enjoy in a free market of ideas. This is an ideal situation that we can never achieve, but hey if democracy is a process and is never ending, then why not strive towards another ideal. 

As The Merovingian rightly said, choice is an illusion. This illusion is created by those who want to maximize profits and create perpetual monopolies. They don't want credible regulators who put the consumers' interest first. These corporate giants want to maximize their profits so that they can have good quarter ending call with analysts. They can't see beyond the red and black of the profit and loss account at the end of the quarter. They can't see beyond profit projections that give a hard on to market analysts in predicting the next big bull run. They aren't the ones one should look to for the unattainable goal of a free market of ideas.

Then who must give the people the ability to make an unbiased choice?

"That, detective, is the right question," said Dr. Lanning, to Detective Spooner, in the movie iRobot.

It's the people stupid. It's the people.