Libertarian Living: The Nano Car

“The mini-car is the brainchild of one of India’s top industrialists, Ratan Tata, who had a dream to move millions of Indian families off their two-wheelers and into a safer, all-weather alternative. Many auto experts here have likened the Nano to the Henry Ford Model T that revolutionized American life a century ago. The down payment for a Nano is about $70. I made a promise and I kept that promise,” the soft-spoken 71-year-old Tata said at a glitzy launch party Monday. “I dedicate this car to the youth of India who designed it and will use it to transport their families. It shows that nothing is really impossible if you set your mind to it.”

The global economic downturn has only made the car more desirable, and not only in developing nations, Tata said. The company is planning to launch a version of the Nano in Europe in 2011, and after that a souped-up Nano for the U.S. market…..”

More at the Washington Post.

Comment

Hmm. Hate to sound like some desi nationalist preening. But really.  Jack Welch comes out with a begging bowl (he was one of the business men selling the bail out and now he was one of the loudest voices asking for calm on the AIG bonuses)…..

And Tata gives us a car for the masses (I mean the American masses too). No more hideous gas-guzzling SUVs.  A downsized car for a downsized economy….

This was my feel-good story for the month.  Business and technology supplying a market need and solving problems,  in spite of what anti-business propaganda might say.  Of course, I don’t consider the rent- seeking parasites who cozy up to government to be anything more than a criminal class, the kind free-loading inevitably produces, whether at the bottom of society, or more perilously, at the top….

3 thoughts on “Libertarian Living: The Nano Car

  1. I’d be interested in knowing how the factory that makes them is capitalized.

    For technocratic liberals in the tradition of Galbraith and Chandler, the American auto industry is the crown jewel among examples of why economy of scale is so important.

    But in fact that’s true only of the enormous engine block IC engines designed after WWII; and in fact the required capital outlay was further compounded by all the secondary features (like power steering) required to support such a heavy engine.

    The first Model T factory, I believe, was capitalized at under a million $$ in today’s prices.

    The kind of personal automobile required for a relocalized American society, built around walkable communities and regional light rail network, would probably be pretty light. And that’s assuming an IC engine was needed at all, rather than an electric engine, if the main customer demographic was people in dispersed peripheral areas who didn’t live near a railhead, and the main purpose was light hauling in and out of town (say for truck farmers taking light loads of produce to the farmer’s market).

    More generally, most of the ostensible examples of stuff that supposedly requires large-scale, capital-intensive production turn out to be manufactured needs that wouldn’t even exist in a decentralized libertarian society.

  2. That’s very interesting, Kevin.
    I’ve always wondered about the economies of scale argument.

    I think it’s true in some areas of production and in some things, but eventually size seems to always become a problem, not least because nobody seems to know what is going on. I think that’s in line with the anthropological evidence too.

    Mega corporation apologists will tell you this is some kind of redistributionist fantasy masquerading as observation. It isn’t. I think if market forces really reigned, very few of these giant companies which claim their capital needs are so high will actually survive. In fact, they’re already keeling over. The reason is, the bigger a company the greater the number of technocrat managers needed and the managers have separate interests from the owners or the shareholders. It stands to reason that the conflicting interests eventually consume a disproportionate amount of time and energy and create incentives for turning a productive enterprise into a rent seeking one, both in relation to the government (through various subsidies and preferential programs) but also within itself – the manager’s reward become completely unhinged from anything he might be doing to actually improve/increase production.

  3. In fact the de facto manager control of the corporation bears a pretty close resemblance to all the negative features of the Lange version of “market socialism” Mises criticized. It’s people risking money that isn’t theirs.

    The management of large corporations are a lot like the management of Soviet economic branch ministries. They claim to represent the shareholders, just as the Soviet bureaucrats claimed to represent the workers. But in both cases, the economy was really controlled by a self-perpetuating oligarchy in control of a free-floating mass of unowned capital.

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