Being in the US one cannot be far away from the debates about the economic policies followed by the Government to beat the recession... while Obama is going to the cleaners shouting that the economy is in such a state only on account of a decade of republican vices... and republicans are prompt to criticise Obama for what they say are going to shrink the economy rather than grow....

And that is where I have figured out the crucial difference between Republican and Democratic parties... ofcourse I need more information... but the thin line that divides the Republican party and Democractic party in economic policy is their view about Government regulation... the former believes in total free economy... completely free hand to deal with the business anyway you like.... the market will correct itself.... while the latter has traditionally been more in favour of a regulated growth.... and with the economic crisis blowing the lid off the Republican theory of market correcting itself (none of them contemplated the effect it would have on the common people), people are now confused about Obama's handling of the economy...

the main grouses seem to be the tax increases proposed by Obama... Obama proposes to increase taxes for the rich, regulate the banks more and make the Government a strong pillar of the economic recovery (not that there is any other way)... many cry foul claiming that the increase in taxes would make it difficult for the business to be profitable... they want a free hand in governing their business and dont want regulation to scuttle their efforts.... they Obama as anti-business .... and most importantly all of them who are criticising Obama are very rich and not very affected by the crisis...

I have a pretty strong view of what the Government should do and should not do... while on the one hand there is my father who was very upset when the Indian Government sold Modern bread saying "what is the use of this Government if they cant even provide bread to the people of this country?" .... while I dont subscribe to this view at all.... there is also the other view which is that Governments have stifled growth for so long in India it is time they got out....

both have merit.... but my preference is for a "vigilant" Government... a Government that is out of the business of making money but is vigilant enough to step in when it affects the larger public good (for instance the hiking up of prices, or even inducing shortage of goods in the market etc.)... hence I prefer the Government to concentrate on areas that are not going to be money making enterprises for the private sector such as education, agriculture, law and order, rural roads and bridges.... and deflect the private sector business into the other sectors where private sector is likely to make more money... yet the entry of the private sector has to be regulated so that their entry and exit do not cause massive distress to the economic infrastructure of the country... for instance, you dont ICICI to collapse one fine day... you want the Government to regulate the banking business enough to ensure that banks dont run out...

I am not entirely a proponent of the mixed economy - but I believe the Government cannot be far away from the economic process either.... it is a fine balance...