THE HARD TRUTH ABOUT THE STATE OF THE ECONOMY
We lock our doors at night to keep common criminals from stealing our property. We leave our bank accounts wide open for political theft every single day.
Every economics organization in my city is closely linked to local government. The groups spend their time coming up with ways politicians can use taxpayer money to mold the economy in their image. Small, special-interest groups think they know what is best for the 1 million people who live in Jacksonville, Florida.
Expand that process out nationally.
The federal government, made up of smaller groups with special interests attempt to do what they think is “best” for 330 million Americans every day. And they are more than happy to use force and coercion to wrangle citizens into submission in the name of altruistic economic policy.
After all, Richard Thaler won the Nobel prize not long ago for his work on economic nudging. He posited that because people don’t know how to make proper decisions for themselves, governments should nudge them in the right direction via policy, propaganda (Freudian slip, I meant media), incentives, and other tactics.
Politicians can’t even control themselves, yet voters expect them to rationally control the human action of millions of people on a national basis.
That is what economics is. It is human action.
ECONOMICS IS ANARCHISTIC
Austrian economist Ludwig von Mises said, ‘Economics is a living thing—and to live implies both imperfection and change.”
Voluntaryists and Anarchists are often scoffed at by critics deeming our ideas as ‘utopian.’
What is utopian is the idea that one group of people can control the behavior and fulfill the wants and needs of an entire country. What is even more utopian is the thought that this could possibly go well.
Throughout history, every time a government assumes the role of economist, people lose their jobs, starve, and die.
A quick rundown of just a few of these examples are the famine known as the Holodomor in the Ukraine (Stalin), the Holocaust at the hands of the Third Reich in Germany (Hitler), Fidel Castro’s reign in Cuba, the Great Leap Forward in China (Chairman Mao), and the Great Depression in the United States (FDR).
Ever find it ironic that the worst economic disaster to happen thus far in the United States (the Great Depression) took place after the Federal Reserve was created to supposedly control the economy so disaster would never strike?
That’s a head scratcher, isn’t it?
We often learn about the human atrocities of these administrations in the classroom (although curricula conveniently leave out the history lesson on FDR’s Japanese Internment camps during WWII). But the economic policies of these governments are often skipped because what most fail to realize is the best way to assume tyrannical control over a population is to manipulate their money supply.
When politicians fail citizens economically it is a human atrocity.
When centralized governments debase the currency, print endless amounts of money, enact price controls, tax productive citizens, create trillion-dollar government programs, and put up so much red tape for entrepreneurs that they can’t keep their businesses open, let’s be clear, these are inhumane, egregious violations.
Despite Austrian economists pointing these issues out with Business Cycle theory, and despite them predicting every economic disaster in modern times, people still scratch their heads when their bills get higher and they can’t afford meat at the grocery store.
Inflation, just one of the nightmares involving governmental control of money, happens when a central bank (in our case the Federal Reserve) prints money that isn’t backed by real production. And this past year they have printed a lot of money. Over 40% of our current dollars in circulation were printed in 2020.
With all their hubris, they thought they could turn the economy off and back on like a light switch and the damage would simply be “transitory.”
But what have I driven home this entire article thus far? The economy is human action. You can’t turn people on and off like light switches. Dictators through out history have repeatedly tried and it never ends well.
Just in the last few months, here are the price increases I’ve experienced along with everyone else:
-Grocery Store prices
I’ve also talked to businesses while out and restaurants are experiencing price increases with the foods they buy therefore, hopefully you guessed it, restaurant prices are increasing.
Even digital entertainment prices are increasing. Hulu and Sirius XM sent out notices recently about their upcoming subscription increases.
My now former car insurance company notified me about premium increases. When I asked the customer service rep about the increase given my very boring driving record, she stated the cost of doing business in my area has gone up so premium prices are increasing.
Credit Card limits are increasing across the board as well in anticipation of rising costs of consumer goods and services.
When the government turned the economy’s switch off without any warning in 2020, no one was allowed to go anywhere. Business adjusted accordingly. They decreased production. They shipped less. Many closed down. Workers stayed home because they received taxpayer-funded government money right in their checking accounts.
Flashforward to a year later and the government suddenly turns the economy’s switch back on. Like spoiled children who refuse to learn consequences no matter how many mistakes they make, they expected businesses and consumers to magically start buying and selling in perfect harmony again.
Governments always start preaching kumbaya bullshit when they are about to take advantage of societal ignorance.
Fed Chair Jerome Powell said inflation would be ‘transitory,’ downplaying economists’ concerns over what they were seeing with the lumber market alone.
As of 2021, the Producer Price Index has increased to 8.6%. The Consumer Price Index has increased to a high not seen in over three decades. Food prices have increased between 3.5-4.5%. Overall inflation is currently at 6.2% and it’s climbing.
Economists are predicting this coming Thanksgiving will be the most expensive meal in the history of the holiday.
Does any of this feel transitory to you?
TAKE HUMAN ACTION
Mises once said production is ‘anarchistic.’ In other words, you can’t centrally plan an economy. A properly functioning economy which fosters sound currency, entrepreneurship, savings, and wealth is human action married to human nature in their proper state of freedom.
While individuals won’t always act rationally, it is a universal guarantee governments definitely won’t.
The utopian idea that government and economy must exist together is detrimental to livelihood.
The free market has lifted more people out of poverty than government ever has.
The domino effect that always comes from a central authority attempting to manifest the economic fate of billions of people will continue for years. Inflation, consumer goods prices, and production prices are expected to continue to rise well into 2022. The Federal Reserve is hellbent on printing more money and finding new ways to confiscate earnings. Taxes will increase for the foreseeable future.
While all this can bring about nihilistic tendencies, remember what French philosopher Frederic Bastiat said, the state is a great fiction.
Creating the life we want for ourselves and our families is not about voting harder. It’s about living smarter.
It is about taking economic power out of the hands of tyrants, and into our own hands.
There are many ways to do this but it all starts with Mises’ philosophy, take human action.
No matter how big or small, whether you go full-agorist or simply find a better way to hedge the purchasing power of your savings against increasing inflation, embrace rational thought and action because that is the last thing the media and the State wants you to do.
It’s not sexy (though it is to me). It’s not as thrilling as the latest superhero movie release. But taking the time to learn sound, objective economics is the difference between being caught in the crossfire of abhorrent central economic policies and being able to ultimately escape them.
Start with one of my favorite works by Mises, his essay Economic Calculation in the Socialist Commonwealth.
“There is no such thing as the State.
We must love one another or die.” -W.H. Auden
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