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Source link: http://archive.mises.org/10039/its-not-working/

It’s not working

May 29, 2009 by

First quarter data look terrible, with another productivity slam but we once more get the media spin: be happy because things are getting worse at a slower pace that before.

Say, does anyone remember that President Bush’s amazing Keynesian program of countercyclical policy–debt, spending, inflation, regulation, bailouts–was supposed to prevent exactly what we are seeing now?

The full story of what we’ve seen is here.


Stephen Yearwood May 31, 2009 at 9:04 am

to fundamentalist:

You raise issues which a complete account of justice must address (and which I do address in my book, A Just Solution). That “the free market can’t eliminate all injustice and it was never intended to” is precisely the problem, when it some to people’s incomes. As I wrote in an earlier post, I’m not advocating socialism or communism. I can’t show you a system that has been better, as far as the distribution of well-being, than capitalism has been, either currently or in history (at least not in the history of civilization). I have come up with a system, though, that would retain free markets, yet solve the problem of justice in remuneration. The institutional structure necessary to achieve that goal would also produce an economy with neutral money. There would be no limit on how much money anyone might earn or how much property anyone might acquire. At the same time, there would be no transfers of wealth or income. For that matter, there would be no taxes of any kind–no income tax, no payroll tax, no property tax, no sales tax, no excise taxes–no taxes, period. Government gets funded in that model as a function of the circulation of the money supply, from consumers, to businesses, to government, and back to the monetary agency (which has no discretionary power of any kind whatsoever). I know that’s a heck of a lot to throw out there all at once, but it seemed like that was the point at which this discussion had arrived. I hope that doesn’t end the discussion.

vc May 31, 2009 at 9:16 pm


“My idea is that fiat money would be fine as long as the size of the supply of it couldn’t be arbitrarily manipulated.”

The only reason to have fiat money is to manipulate the supply. Can you provide another reason?

“As long as the determination of the amount of the money supply was beyond the reach of any person or group, I’m saying, fiat money could serve that purpose. ”

Have you considered what you are saying here? Since, by definition, the fiat money supply is determined by the issuing body, fiat money can not possibly serve any purpose that requires its supply to be “beyond the reach of any person or group”.

“That ‘the free market can’t eliminate all injustice and it was never intended to’ is precisely the problem, when it some to people’s incomes. As I wrote in an earlier post, I’m not advocating socialism or communism.”

Yes, you are. Either you agree with free voluntary exchange or you believe in taking from one to give to another, which is theft, in the name of “justice”.

newson May 31, 2009 at 11:19 pm

i’ve got take issue with you here, everyone was not equally poor under socialism! the standard-of-living spread was probably more pronounced under socialism than under capitalism. (castro was reported to be furious at appearing on forbes’ “rich list”, with an estimated effective wealth of $550m. compare that to the average cuban.)

filc June 1, 2009 at 12:41 am

No offense Yearwood but I highly suggest doing more reading on what Fiat currency is, how it works, and what its purpose is before you make an argument for or against it.

Stephen Yearwood June 1, 2009 at 7:51 am

vc & filc:

All I can say at this point is that my plan accomplishes all that any Austrian or libertarian could hope to accomplish, including minimal government and no taxes at all while retaining the free-market system for the production and distribution of goods and services. If you’re interested, there is more at my website, ajustsolution.com. (It’s very rudimentary, but it’s there.)

I will say you’re in good company, though. Marxists don’t like my economic plan because it doesn’t conform with their ideology, either. It doesn’t conform with any ideology, because the ethic that underlies it, mutual repsect in effecting choices, isn’t based on any belief, whether a belief in equality or the existence of Natural Rights or any other pre-existing rights (rights that are supposedly perceived by people, as opposed to being conceived by them). It follows from the observation that every human being exhibits a capacity to choose for oneself, but no one can prove that anyone is inherently more (or less) worthy of having one’s choices be effected than is any other person. While that takes us toward equality, mutual respect in effecting choices is the most immediate ethical conclusion to be drawn from that observation. Unlike equality, mutual respect is an ethic that can be applied to the economy, in particular the process of remuneration.

fundamentalist June 1, 2009 at 8:10 am

Newson, Good point! We tend to think that everyone is equal under socialism because the number of wealthy people has shrunk so much that they’re hardly noticeable. The leadership of the USSR was very wealthy, too.

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