Section A: Verbal and Logical Ability

Analyse the following passage and provide appropriate answer for the question 27

Passage - 4

Soros, we must note, has never been a champion of free market capitalism. He has followed for nearly all his public life the political ideas of the late Sir Karl Popper who laid out a rather jumbled case for what he dubbed “the open society” in his The Open Society and Its Enemies (1953). Such a society is what we ordinarily call the pragmatic system in which politicians get involved in people’s lives but without any heavy theoretical machinery to guide them, simple as the ad hoc parental authorities who are believed to be needed to keep us all on the straight and narrow. Popper was at one time a Marxist socialist but became disillusioned with that idea because he came to believe that systematic ideas do not work in any area of human concern.

The Popperian open society Soros promotes is characterized by a very general policy of having no firm principles, not even those needed for it to have some constancy and integrity. This makes the open society a rather wobbly idea, since even what Popper himself regarded as central to all human thinking, critical rationalism, may be undermined by the openness of the open society since its main target is negative: avoid dogmatic thinking, and avoid anything that even comes close to a seat of unbreachable principles. No, the open society is open to anything at all, at least for experimental purposes. No holds are barred, which, if you think about it, undermines even that very idea and becomes unworkable.

Accordingly, in a society Soros regards suited to human community living, the state can manipulate many aspects of human life, including, of course, the economic behavior of individuals and firms. It can control the money supply, impose wage and price controls, dabble in demand or supply side economics, and do nearly everything a central planning board might in demand or supply-side economics and do nearly everything a central planning board might-provided it does not settle into any one policy firmly, unbendingly. That is the gist of Soros’s Popperian politics.

Soros’ distrusts capitalism in particular, because of the alleged inadequacy of neoclassical economics, the technical economic underpinnings of capitalist thinking offered up in many university economics apartments. He, like many others outside and even inside the economics discipline, finds the arid reductionism of this social science false to the facts, and rightly so. But the defense of capitalist free markets does not rest on this position.

Neo-classical thinking depends in large part on the 18^th- and 19^th-century belief that human society operates according to laws, not unlike those that govern the physical universe. Most of social science embraced that faith, so economics isn’t unusual in its loyalty to classical mechanics. Nor do all economists take the deterministic lawfulness of economic science literally – some understand that the laws begin to operate only once people embark upon economic pursuits. Outside their commercial ventures, people can follow different principles and priorities even if it is undeniable that most of their endeavors have economic features. Yet, it would be foolish to construe religion or romance or even scientific inquiry as solely explicable by reference to the laws of economics.

In his criticism of neo-classical economic science, then, George Soros has a point: the discipline is too dependent no Newtonian physics as the model of science. As a result, the predictions of economists who look at markets as if they were machines need to be taken with a grain of salt. Some – for example the school of Austrian economists – have made exactly that point against the neo-classical.

Scors draws a mistaken inference: if one defense of the market is flawed, the market lacks defense. This is wrong. If it is true that from A we can infer B, it does not prove that B can only be inferred from A; C or Z, too, might be a reason for B.

27. As per the paragraph, which of the following statements is true?

A. Economic benefits of open society and laissez faire are same.

B. Soros’ open society mean no interference from the government.

C. Free market capitalism means no interference from the government.

D. Laws of economics are not capable of explaining the human nature completely.

E. Laws of economics capture the human nature completely as most of the human endeavors are economic in nature.

Explanatory Note:

The fourth para states that most of the endeavours may have economic features, but no aspect of social life is solely explicable by reference to the laws of economics. Choice (D)