The Free Market Fundamentalism that Libertarianism is famous for is simply wrong. Free Markets are a means to an end, not a goal in themselves: to allow efficiency and equitable access to all in society. It’s quite clear that markets can easily go overboard and they need to be managed, just like all human enterprises and public spaces.
This is is not to say that Libertarians don’t make a decent point in their analysis of the perverse consequences of many Government regulations. They do. It’s undoubtedly fair to say that many Governmental interventions do more damage than they do good.
Producers and consumers should be able to interact with as little interference as possible.
Also, it’s undoubtedly true that Governmental tyranny has been an unmitigated disaster for mankind throughout the ages.
However, Austrianism completely ignores the monopolistic tendencies of capitalism and puts all the blame for monopolies on Governments being used by corporate elites to create cartels and monopolies. Why they don’t blame the owners of these monopolies remains an open question.
It is also amazingly simpleminded to assume that these monopolies would not exist without Government mandate, as Austrian Economists proclaim. I believe everybody thinking this over calmly will quickly realize that dominant market players will always disable small time competition and that they will quickly take over the maiden ‘free market’. If it’s not Government that should stop this, Austrians should explain who should.
There is also the issue that the markets serve society and not vice versa. So if, for instance, a nation suffers from lack of competitiveness in international trade there is absolutely no reason not to create tariffs to keep foreign competitors at bay. In fact: the nation has the solemn duty to protect itself from such a situation.
Free trade does NOT always benefit all involved, that’s complete nonsense. Often the free traders will point at the ‘long run’ but their arch enemy Keynes put that argument to rest by saying ‘in the long run we’re all dead’. And that’s the way it is.
When commissioning the Transcontinental Railroad, Abraham Lincoln said something to the effect of ‘If I buy the rails in Britain, we will have the rails and they will have the money. If I buy the rails for a little more in America, we will have the rails and the Union will also have the money’.
This is the simple truth and it is yet another amazing feat of propaganda that the Free Traders have managed to obscure this.
It’s the same thing with Transnationals plundering local economies.The small discount the individual gains at Wal-Mart is simply a knife in the back of his neighbor and the regional economy is devastated by buying there. The main problem is that Wal-Mart takes most of the money out of the local economy, with deflationary effects. Some time back a fascinating study was published quantifying the effects Wal-Mart has on the economy, both locally and nationally and the damage that that one Transnational has done has been incredible. Here’s my report on that study.
This is yet another great slogan of the Libertarians: choice. No, CHOICE, as it is often spelled by free market commenters I speak with. Even the Lord Himself is usually granted only one capital.
It’s annoying how people get enthralled with pleasant sounding words without ever really thinking through what such a word means and what kind of implications can be expected.
They will maintain that if two parties consent, there is ‘free will’ and that’s the end of it.
But let’s consider Rothbard’s ultimate example of ‘freedom’ and ‘choice’. He defended the ‘right’ of parents to sell their children in the ‘free market’.
Obviously he was mistaken as he apparently did not see the children as people. Nobody in his right mind is defending trading people, is he?
Would the child accept this ‘choice’? What would (s)he choose? Even if it consented, out of love and loyalty to its parents and because of a lack of awareness of the implications, would it be relevant?
Also, what kind of ‘freedom of choice’ would lead to such a decision? Are there many parents out there particularly interested in the ‘choice’ to sell their children?
Of course, selling one’s own children is a common practice. With desperate people. People in incredibly dire economic circumstances WILL sell their children.
Should they be allowed to? Of course not. Their situation should be mended.
Rothbard, with this heinous and morally utterly corrupt example just shows his real face here and this is ultimately where Libertarianism is headed.
It’s important to understand that this is not even just the sickening blathering of a man suffering from profound spiritual problems. This is the unavoidable end game of Capitalism. The right and the ability of the ultra rich to monopolize all ‘resources’, including ‘human resources’. It’s clear that when everybody has been made utterly destitute with their usurious banking con, the last and final bailout for the poor will be to sell their children into slavery. This is what
happened to the Africans, once they were bankrupted by selling them liquor.
They first sold their children, then their wives and ultimately they went out enslaving neighboring tribes.
Is there anybody out there doubting this is the usurer’s wet dream?
To be honest: there probably are many who cannot believe it. But it’s time to wake up and smell the coffee: this is the kind of depravity that we face. This is the kind of darkness that rules the hearts of our overlords. It is not for nothing that this is where their ideologies ultimately lead to.
So ‘choice’ is not so wonderful as it has been made out to be. Not all choices are equal and many choices simply utterly detestable. The so called ‘freedom’ to make certain ‘choices’ is not quite what many joining the burgeoning ranks of Libertarianism really had in mind.
‘Choice’, nor ‘Free Markets’ are a goal in itself. There is a moral imperative. The fact that Libertarianism does everything in its power to avoid this, is why it is ultimately Satanic by nature.
We are not looking for ‘heavy handed violent statist interference’ as the libertarians like to put it. Nor do we believe that all, or even many, of our problems are going to be fixed by Government. But clearly ‘free markets’ do not exist. Not for longer than one minute, anyway.
The perceived ‘rights’ of the ultra rich are not particularly important. What is important is a reasonable deal for all. This is absolutely possible. We live in an incredibly abundant environment.
Of course this leads to the question ‘what is a reasonable deal?’. And undoubtedly this question will keep us busy for a long time. But there is also such a thing as common sense and once we start seeing through the many extremist ruses the Money Power’s Mind Controllers distract us with, from ‘anarcho-capitalism’ to ‘communism’, things will prove to actually be not really so complicated.
Here’s a man that actually understands. Courtesy of Ted Daniels and Jamie Bergamasco:
Recently Tom Woods has been on a crusade ‘debunking’ the critique on Austrian Economics by Wayne Walton and myself. Yesterday he reasserts his faith in deflation in an article also posted on Lew Rockwell. In this article we not only, again, disassemble the breathtakingly ‘naive’ Austrian view on deflation, we throw in a challenge too.
As said previously, Wayne and I met Tom Woods on Facebook, courtesy of Gigi Bowman. In that discussion Tom Woods took the convenient road of ignoring everything I said and focussing solely on Wayne’s arguments.
I say this with a gentle and respectful heart, as I know Wayne will fully appreciate: Tom was doing what a skilled debater, not interested in truth, but in winning the argument would do: he chose the softer target.
No problem: we just expose that by providing the link to the ‘debate’, call it what it is, intellectual dishonesty, and provide Tom with the option of righting the wrong.
Yesterday Woods wrote an article, also posted at Lew Rockwell’s, regurgitating the same nonsense about deflation and basically claiming victory. Apparently assuming nobody would find out about what actually happened, because he didn’t provide the link to the Facebook debate.
Of course we’ll point out the obvious (for the readers of this blog) once more, by analyzing his article, but before we do, let me say this.
It’s high time for a full blown, man to man debate with some of these Austrians. I’m willing to meet Tom Woods, Gary North, Anthony Wile, Ron Paul, Lew Rockwell or any other Austrian of standing any time in a Skype debate. I have a few simple conditions, which will be as favorable to them as possible:
1. They can choose the discussion leader. There is a gentlemen’s agreement that this man will facilitate the debate in a civilized way, only somewhat favoring his own side. The public will be there to see if this gentlemen’s agreement is honoured.
2. The discussion is posted both on our sites (Makow, Truthseeker, Real Currencies, Daily Knell and all others who see fit to post) and on the Austrian outlets, with a mutual link to the analyses of the debate.
3. I will not go into the elite build up of Austrianism: I will just take out their stand on usury, deflation, Money Power and the State.
4. If anybody is ready to cover the costs, I’ll fly to the US, notwithstanding my fear of flying, which I will manage with a couple of stiff Gin-Tonics, and my utter disgust of the TSA. I’ll face them all on their own home turf any time, any place.
5. This offer will stand indefinitely.
Having said that, let’s get to the issue, which, in this case, is deflation.
More BS on Deflation
In the first place, Tom Woods refers to ‘us’ as ‘some in the End the Fed Movement’. That’s his prerogative, of course, but I prefer Activist Post’s Eric Blair’s 2010 framing of the debate, when it started with North’s assault on Brown and my rebuttal at the time.
It’s the Interest Free currency crowd against the Goldbugs. Basically a struggle that started in the late 1800′s. According to Blair, ‘this may indeed be the most important discussion of our lifetime’, and although I can think of one or two even more important issues, it’s still pretty important and ‘we’ are not just ‘some in the End the Fed movement’.
‘We’ are those who have tolerated the Austrians in the Truth movement, because they, at a superficial level, seemed to support some of ‘our’ positions, most notably their opposition to the FED. Meanwhile ignoring, downplaying or outright denying 9/11 ‘conspiracy’, like Kokesh, Paul, Paul, North, Rockwell and so many other Austrians infiltrating the real deal, facilitated by that traitor Alex Jones.
But, as I’ve shown elsewhere, their take on the FED has been taken from the populist movement and used to propose the insidious ‘Gold Standard’ (nowadays packaged as a ‘free market for currencies’) as the solution to FED usurious fractional reserve banking.
Secondly, in a speech that Tom Woods refers to in his article, he ‘debunks’ the notion that the Gold Standard was a disaster by quoting the Industrial Revolution. According to Woods, this was a great success while on a Gold Standard. This, obviously, is in the eye of the beholder. During the ‘Industrial Revolution’, the common man was relegated to 80 hour working weeks in the sweatshops, making just enough to feed himself (but not his family) on a spuds/grains only diet. His wife AND children were working long weeks also, just to feed themselves. From the point of view of those holding gold, those we call the Money Power, this was indeed a great success. This is capitalism at its best: all owned by a ‘happy’ few, with the many licking their boots in exchange for a horrorjob.
During the non-usurious age of plenty, called the ‘dark ages’ by the Money Power apologists, a working man worked 15 weeks per year to feed not only himself, but also his massive family.
Third, in this same talk (by the way, for some very, very well off individuals, while complaining Austrianism gained so little traction with the elite) Woods does the same thing that many Austrians do and which he tried to pull of in the mentioned Facebook discussion also: he tried to downplay the relation between deflation and depression by quoting the (in)famous Atkeson/Kehoe study which famously denies a relation between the two. There are two rather major problems with this study though. In the first place, it was commissioned by…………yes, you guessed it, or you knew: by the FED.
Now, I’ve said this before and I’ll say it again, because I like to rub it in: how disingeneous is this: our Austrian Fed busters quoting a Fed study when it serves their purposes, in this case defending deflation. The Fed, tirelessly exposed by valiant Austrian Knights for hiding their messing up the volume of money. When they mess up the volume in terms of inflation, that is. But when it comes to hiding their deflating the money supply it’s all of the sudden a trusted source and ally?
To be honest: these kinds of antics are typical of Austrians.
The second thing I have a MAJOR problem with is this: in this study deflation is defined as ‘declining prices’. And ‘t is true: in this day and age of obscuring truth about money, inflation is often defined as ‘rising prices’ and deflation as its opposite. But everybody with even negligible awareness of what is going on in terms of slanting definitions and hiding truth through wordgames in economics knows that inflation really means ‘a growing money supply’ and deflation ‘a
dwindling money supply’. Sure, nowadays it’s hip to say there are two definitions. But Tom Woods is a ‘senior fellow’ of the ‘reputable’ Mises Institute, so I’m not going to give him ANY slack here. He’s just playing the game of make believe.
Fourth, Woods calls Walton ‘tone-deaf’ to the financial world, as, according to Woods, the financial world is paranoid about deflation and apparently fears nothing more than just that.
This is where we enter the, what I like to call, ‘ultra naive’ parts of the Austrian paradigm. It’s amazing how many Austrian positions are both utterly naive to the real world and simultaneously incredibly comfortable to the Powers that Be and this is a typical case in point. Obviously, the elite does not fear deflation. However, it is keenly aware the masses (us) absolutely deplore deflation. We hate it, because it broke our back in the thirties and many other depressions. So of course the Money Power and its shills cater to this by being very busy pretending they hate deflation too.
That’s why Ben Shalom Bernanke is very comfortable being called ‘helicopter Ben’, because he will be dumping cash on a deflated economy, calming the gullible. Of course the not so gullible clearly see his QE1, 2, 3, x do nothing to reflate the economy (and thus nothing to end deflation) but is solely focused on allowing the ultra rich in unloading their busted ‘derivatives’ like Mortgage Backed Securities and other silly financial ‘products’ at full nominal value at the expense
of the ultimately taxpayer backed Federal Reserve Bank.
Fifth, continuing in the same ‘naive’ vein, he then addresses Wayne’s very, very solid point that “Monetary deflation benefits the private bankers who wish the People to default in order to seize collateral with, or without govt force.”, saying that this is ‘clearly incorrect’, because banks surely would not want to get their hands on ‘potentially illiquid assets’.
He continues by saying: ‘When asset prices are falling, why would banks want to grab assets?’
Well Tom, let me explain this to you: not everybody is surviving from month to month. There are individuals and organizations that are actually capable of long term planning. And I’m not talking a year here. I’m talking not even several years, but decades. Centuries even.
So while I, and maybe even you, live day by day, the banks actually realize that at some point the deflation is going to end and their newly acquired assets are bound to gain a lot in value……. Yes, it’s called speculation and banks and their owners have shown to be quite good at that.
But this argument Woods apparently expects and he proceeds to say: “Ah, but couldn’t the banks coordinate the deflation together, and then when
it hits bottom, grab all the assets at that moment, when their prices have nowhere to go but up? Even assuming that bankers would adopt such a far-fetched strategy, there is no way for them to know at what point in the deflationary process the defaults are going to occur.”
Ah yes…. far-fetched……….Like I said, their is a certain ‘naiveté’ to Austrianism that would even be quite touching, would one be unaware of the untold billions poured into disseminating these childish ‘mistakes’. Nowadays, it’s a mainstream science matter of record that all the banks own each other and are one major cartel, no, monopoly.
So no this is not ‘far-fetched’. What IS far-fetched is Woods’ statement that ‘there is no way for them to know at what point in the deflationary process the defaults are going to occur.”
Utterly ‘oblivious’, probably because of the same ‘naiveté’, that the banks are causing the deflation willfully and know exactly when it will end. Because it will end when they will start lending again.
Tom Woods made a fool of himself. He comes up with the same nonsense and then some that Austrianism is now becoming famous for as many in the Alternative Media are waking up to their stupid ‘ideas’, that were generated at such a massive cost to the Money Power by Tom Woods’s employer Lew Rockwell and his Volker Fund buddies.
But of course we’re far too polite and far too interested in maintaining cordial relations with everybody even pretending to oppose the banksters. That’s why we propose a debate ignoring Austrian financing: just aiming at the issues themselves.
In this article we have not even mentioned that during deflation debts become worse in real terms, as do the interest costs related to them. We have not mentioned its disastrous effects on economic growth.
That’s because Deflation Apologist Tom Woods chose to ignore these rather important issues……
Discussing Gold and Interest with the Daily Bell
Austrian Economics, Apostles of Austerity Defending Deflation
the Austrian ‘Free Market for Currencies’ Hoax
The Inflation vs. Deflation Dialectic
Who is Ed Griffin?
Following our recent article on the control of the Libertarian movement by Money Power, we have received several comments from Libertarian sympathizers over the last few days. These comments are generally similar in that they offer the typical Libertarian and Austrian objections to the viewpoints expressed on this blog. In an effort to avoid repeating ourselves and to expose our ideas in a different format, we propose the following xtranormal video, which presents a dialogue between a typical Libertarian sympathizer and a Daily Knell blogger. Enjoy!
The Huffington Post published an October 8, 2012 article by Bonnie Kavoussi entitled “11 Lies About the Federal Reserve,” to which Mises Institute associate Tom Woods followed up with a rebuttal entitled “HuffPo’s 11 Myths About the Fed, Refuted.“
For those who are aware of the Hegelian dialectic of thesis-antithesis-synthesis, the Huffington Post is putting out the thesis in opposing a government-guaranteed gold standard and Tom Woods is putting out the antithesis of defending a government-guaranteed gold standard, and the synthesis that is presented by Tom Woods in his other works is that of a so-called free market gold standard of competing currencies.
For more on why a so-called free market gold standard is a false solution, see my article, Gary North’s free market gold standard is also a fool’s gold standard.
Whether Tom Woods realizes it or not, he has played right into the hands of the Money Power in presenting the case for a gold standard, whether it be a government-guaranteed gold standard or a so-called free market gold standard — the Money Power ultimately cares not — since they control the proposed medium of exchange, as George Whitehurst-Berry details in this article.
In a series of articles earlier this year, Anthony Migchels and I exposed how Libertarianism and Austrian economics were sponsored by the elites as a dialectical counterpart to Communism during the 20th century. See especially:
The sad truth is that not much has changed during the last 60 years. We already know that Ron Paul is backed by billionaire Peter Thiel, a member of the steering committee of the Bilderberg group.
But what few people realize is that the entire Libertarian movement is still controlled by a handful of individuals who are directly connected to the highest elite circles, including the Rothschild dynasty. In this article, we will shed more light on these connections and expose the elites’ control of the Libertarian movement in the 21st century.
The Agora Empire
As documented in The Daily Bell Hoax?, blogger (and libertarian sympathizer) Lila Rajiva recently revealed that Ron Paul had a longtime partnership with James Dale Davidson, founder (with Lord William Rees-Mogg) of the financial conglomerate Agora Inc. Through the Agora network, Davidson, Rees-Mogg, and executives Bill Bonner and Addison Wiggin control most of the “hard-money” investment newsletters and “free-market” websites in the West, most of them ferociously pro-Paul.
These outlets include: Anthony Wile’s Daily Bell, Bonner’s Daily Reckoning, Doug Casey’s International Speculator, Gary North’s Remnant Review, The Oxford Club, Whiskey & Gunpowder, Laissez-faire Books, a leading libertarian bookseller, and a slew of other “alternative media” websites. It is no exaggeration to say that Agora controls most of the Libertarian material published in the West.
Rajiva’s revelations are important because they blow apart the myth of the “Ron Paul revolution” as a grassroots movement, and confirm Paul’s close ties with elite globalist financial concerns. In fact, Lyndon Larouche’s Executive Intelligence Review (cited by Rajiva) implied a direct link between Libertarian circles and the Rockefeller and Rothschild, the very elites whose domination they claim to abhor!
Libertarians, “hard-money” investors and power elites: an enduring partnership
Although Davidson and Rees-Mogg apparently promote pseudo-libertarian solutions and “free-market” thinking, both are bona fide members of the highest elite circles. Davidson was likely a Rhodes scholar (although he does not publicize this information), a leading indicator of acceptance into elite British circles.
His partner Rees-Mogg was a longtime editor of the Times and a member of the governing council of the BBC. He is a member of the very select Roxburghe Club and apparently has ties to the Pilgrims Society. He also belongs to The Other Club, together with British and Zionist aristocrats such as the Cecils, Howards, Cavendishes, Rothschilds, and Oppenheimers. Rees-Mogg is also on the board of Rothschild’s St. James Place Capital.
Rees-Mogg and Davidson apparently work in tandem with mainstream British journalist Ambrose Evans-Pritchard, whose father was a military intelligence officer and who has long been suspected of being an intelligence asset himself. It is surely no accident that Evans-Pritchard, known for his anti-Clinton crusade and hard-money sympathies, is one of the few mainstream journalists frequently cited by Wile’s Daily Bell, but very few readers would suspect that they are essentially partners.
Although Rees-Mogg is associated with the Libertarian movement, he would be more accurately described as a fascist. In an article entitled “It’s the Elites Who Matter”, published in the Times in January 1995, Rees-Mogg publicly called for limiting education to the top 5% of the population, creating an elite that would be ideally positioned to dominate the remaining 95% of the people after Rees-Mogg’s so-called “Information Revolution” would bring in a feudalist dystopia.
Soon after Davidson and Rees-Mogg published The Sovereign Individual in 1997, they founded the Sovereign Society, another Agora offshoot. Besides Davidson and Rees-Mogg, the Board of Advisors of the Sovereign Society has included over the years some of the best-known names in the “hard money” community, such as Doug Casey (a classmate of future president Clinton in Jesuit hotbed Georgetown University), CIA asset Mark Skousen (son of a FBI agent and nephew of J. Edgar Hoover’s assistant Cleon Skousen), perennial libertarian candidate Harry Browne, the Aden Sisters (Pamela and Mary-Ann), and Daily Bell advisor Ron Holland.
Casey also founded the Eris Society, a group of “free thinkers” who meet annually. Among the past speakers at Eris Society meetings, we find the names of Ron Paul, Skousen, Browne, Davidson, “Uncle” Richard Maybury, and investor Jim Rogers. Already in 1994, Casey, Davidson, and Skousen were collaborating on a presentation about “ERIS Island”, indicating that their partnership predates the foundation of the Sovereign Society.
Another Agora spin-off is the FreedomFest, the “world’s largest gathering of free minds”. While FreedomFest claims to be independent and “not affiliated with any organization or think-tank”, we find that it is coordinated by Skousen and Holland’s wife Tami, and that speakers associated with Agora are regularly invited. Perhaps surprisingly, Bilderberger Peter Thiel was featured as a keynote speaker in 2011.
Of course, the old Libertarian networks centered around the Volker fund that we exposed in Old Rothschild- and Rockefeller hands controlled the Libertarian-Communist dialectic are still active: thus, Gary North, a Volker protégé, retains an enormous influence in Austrian economics. More interestingly, alumni of the Libertarian think-tanks sponsored by the Volker fund and its affiliates are often found working together with the “new generation” of Agora-associated hard-money investors.
For instance, academics Richard Ebeling, past director of the Foundation for Economic Education, and Tibor Machan, a scholar of the Institute for Humane Studies, are advisors for the Daily Bell. Together with Lew Rockwell, director of the Ludwig von Mises Institute, they also sit on the advisory board of Ron Holland’s Biologix Hair Inc., a company that claims to have developed a therapy for hair rejuvenation.
Only one degree of separation between Rothschild and the Daily Bell
The Daily Bell is a prime example of these apparently independent libertarian outlets that are in fact closely associated with the highest elite circles. The Bell, which earlier this year had to close its comments section in the face of an onslaught of negative criticism, is well-known for its staunch support of Ron Paul, strident goldbug mindset, stubborn advocacy of Austrian faux economics, and more recently for its vociferous condemnation of anti-interest activists.
Not only is Ron Holland, senior editor at the Daily Bell, a longtime associate of Rees-Mogg and Davidson, but so was perennial libertarian candidate Harry Browne, with whom Daily Bell founder Anthony Wile worked for several years.
More importantly, Davidson and Rees-Mogg were once shareholders in Lines Overseas Management (LOM), the Bahamas off-shore company implicated in a stock manipulation affair for which Wile, along with other shady entrepreneurs, was in litigation with the SEC for most of the last decade. Interestingly, the late Bob Chapman was also named in the same SEC probe, raising serious doubts about Chapman’s International Forecaster as well.
In fact, Davidson and Rees-Mogg blatantly promoted LOM in The Sovereign Individual, citing the “triple-digit returns” of their “colleagues” at LOM (p. 298), and advising their readers to contact LOM for investment of “sums in excess of $100,000” (p.403). This indicates that Wile was already involved in a close business partnership with Davidson and Rees-Mogg in the late 1990s, an association that is likely to have lasted much longer given Wile’s longstanding partnerships with Browne and Holland, both advisors at the Sovereign Society.
Considering that Rees-Mogg is an advisor to Rothschild, we can say that there is essentially only one degree of separation between Rothschild and the Daily Bell. How ironic given the Daily Bell’s endless posturing as a free-market publication that aims to “expose the power elite and their societal manipulations”.
But there is more to the story. In The Daily Bell Hoax?, I revealed the existence of a business partnership between the Daily Bell and gold mining concern Dicon Gold Inc., whose main assets are located in Colombia. At the same time, Kathleen Peddicord, founder of the Agora-affiliated “Live and Invest Overseas” publishing group and a member of the Board of Advisors of the Sovereign Society, was recently promoting Colombia, and especially Medellin, as a “screaming bargain” for real estate.
Perhaps not coincidentally, the Daily Bell recently started praising former Colombian president Alvaro Uribe’s pro-business administration, although Uribe was once listed by the Defense Intelligence Agency as an “important Colombian narco-trafficker” and “a close personal friend of Pablo Escobar”. It is difficult to imagine that the well-informed editors of the Daily Bell would not have been aware of this fact. I will leave it to the reader to connect the dots…
Although the names have changed, the cozy relationship between the top Money Power elites and the Libertarian movement has remained essentially the same for the better part of a century, if not longer. This connection must be relentlessly exposed because Libertarian “alternative media” outlets and “hard money” entrepreneurs continually promote their views as being “pro-freedom” and “anti-elite”, in contrast to the mainstream “statist” message, whereas they have in fact always been part of a centuries-old Hegelian dialectic which is entirely controlled by the same transnational oligarchy. We must recognize these gatekeepers for what they are and look beyond their phony posturing if we want to find real solutions to the economic and political issues that our society is facing.
h/t to Faux Capitalist for pointing out Chapman’s involvement with Lines Overseas Management
In this xtranormal video, Youtube user icanttakeitanymore3 succeeds in exposing the central paradoxes of the Libertarian creed and summarizing the essential problems of the anarcho-capitalist doctrine while managing to inject some comedic humor, and all this in less than 3 minutes! Worth watching and spreading around.
Most alternative media outlets promoting Austrian economics are fond of laying all the blame for our economic woes at the feet of politicians and the government. To be sure, Austrian sympathizers are correct in pointing out that governments have become, in most countries, bloated and mismanaged institutions, with labyrinthine rules and an addiction to red tape. However, what is suspicious is that Austrian solutions always end up somehow benefiting private banks and “hard money” proponents instead of the general population.
Let us identify some of the typical memes disseminated by Austrian outlets, through an analysis of Daily Bell’s founder Anthony Wile’s sales pitch for The Foundation for the Advancement of Free Market Thinking (FAFMT). Keeping in mind that Wile and several of his collaborators have worked and still work as consultants for large international banks and other financial concerns, we will apply the well-known cui bono principle to our analysis: who would really benefit from all the reforms and proposals advocated by Wile’s Foundation?
– ‘Politicians all over the world spend with abandon, burdening their citizens with confiscatory taxes, insurmountable debts and economic ruin’
True, excessive governmental spending and heavy taxation are unjustified. However, when Wile talks about “insurmountable debts”, he fails to mention that governments would not need to pay interest if they did not borrow interest-bearing fiat currencies created from nothing. And interest charges are a major part of the burden mentioned by Wile: in the United States alone, interest charges correspond to nearly half of the $11 trillion increase in public debt projected over the next decade.
It stands to reason that, in the absence of interest charges, State deficits would be significantly reduced. Moreover, a larger share of the governmental spending could be directed towards useful programs, instead of paying banksters for the privilege of conjuring money out of thin air. In spite of the Daily Bell’s constant clamoring, there is nothing remotely statist or coercive about noticing this fact: pointing out the ludicrousness of the current monetary system does not mean that one endorses oppressive governments. On the other hand, a failure to notice the longstanding usurious usurpation is almost certainly indicative of a hidden agenda.
– ‘Central bankers shamelessly manipulate and inflate their currencies creating financial bubbles that ultimately burst, leaving shattered lives and businesses in their wake…’
The Daily Bell is only one of numerous alternative media outlets that constantly repeat this assertion. Although the concept of central banking is justifiably open to criticism, this Austrian meme is, once more, a half-truth at best. Indeed, according to recent estimates, 97% of the money supply is created by commercial banks. More strikingly, we learn in Congressman Wright Patman’s Primer on Money that since the 19th century, while the United States were still under the Austrians’ beloved gold standard, checkbook money (credit) created by commercial banks in the form of loans has replaced notes as the most important form of money.
Without minimizing the role of central banks, the reader would be justified in asking why is Anthony Wile heaping so much scorn on central bankers, all the while completely ignoring commercial banks? As a rule, Austrian sympathizers are very voluble on central banks, but are generally remarkably silent on the excesses of commercial banking, and seem unable to understand that the banking system is one.
– ‘The U.S. Federal Reserve and other central banks must be abolished and replaced with currencies 100% backed by gold and/or other commodities…’
Why do we need currencies to be backed by gold and/or commodities? The Daily Bell has never really explained the rationale behind this, except to claim that gold-backed currencies are more “honest”. Whereas physical gold may arguably be more honest in the sense that it cannot be inflated so easily, the same cannot be said for “gold-backed” currencies for which “paper gold” can be printed far in excess of the amount of physical gold backing the currencies. After all, this is exactly why this practice became very popular with goldsmiths.
From Modern Money Mechanics, published by the Federal Reserve Bank of Chicago:
It started with goldsmiths. As early bankers, they initially provided safekeeping services, making a profit from vault storage fees for gold and coins deposited with them. People would redeem their “deposit receipts” whenever they needed gold or coins to purchase something, and physically take the gold or coins to the seller who, in turn, would deposit them for safekeeping, often with the same banker. Everyone soon found that it was a lot easier simply to use the deposit receipts directly as a means of payment. These receipts, which became known as notes, were acceptable as money since whoever held them could go to the banker and exchange them for metallic money.
Then, bankers discovered that they could make loans merely by giving their promises to pay, or bank notes, to borrowers. In this way, banks began to create money. More notes could be issued than the gold and coin on hand because only a portion of the notes outstanding would be presented for payment at any one time. Enough metallic money had to be kept on hand, of course, to redeem whatever volume of notes was presented for payment.
There you have it: the original reason why bankers (and modern Austrians) always favored “gold-backed” currencies over physical gold was because it enabled them to develop fractional banking.
More importantly, we should keep in mind that following Wile’s suggestion of abolishing central banks and replacing fiat currencies with gold-backed currencies amounts to transferring the control of the money supply from central banks to those who own gold mines and large hoards of gold. This is why “hard money” entrepreneurs and their Libertarian friends tirelessly promote the concept. But is this really advantageous for the general population, even in the absence of a currency monopoly? Beware of the Austrian ‘Free Market for Currencies’ Hoax!
– ‘Welfare and other redistribution schemes need to be abolished and government spending rolled back at all levels by 60% to 90%…’
Now the true colors of the anarcho-capitalists shine in all their brazen conceit. In their utopian world, private banks should hold most, if not all, of the power to create money: governments would be denied any control over the currency supply and their spending would be severely restricted. It is not difficult to imagine the control over the economy that private bankers would acquire in a few years in such a world. Austrians and assorted anarcho-capitalists may rail against governmental excesses, but it is naïve to think that private bankers will have the best interests of the population at heart.
Speaking of interest, it is worth noticing once again how Anthony Wile and his Austrian friends utterly condemn any form of “welfare and other redistribution schemes” when it comes from the government, but completely endorse another, much more insidious “redistribution scheme”, namely the collection of interest charges by banks. A wealth transfer of trillions for the mere service of creating money at the stroke of a pen. This is another reason why the “commodity backing” is a popular option among the Austrian crowd: by promoting the use a commodity to represent symbolic wealth, Austrians hope to be able to justify interest through their worn-out, and already debunked, time-preference theory. But this is merely a make-believe attempt to give some credibility to this monstrous wealth transfer that is enslaving most of the population.
Not only is interest on credit fraudulently justified through the time-preference theory, but anti-interest activists are also regularly denounced as evil UN stooges conducting “backdoor government psyops”…
– ‘Government regulations – including sacred cows such as anti-trust laws, minimum wage laws and food and drug laws – must be repealed.’
As pointed out above, we do agree that excessive government regulations are a burden. Even worse, many of these regulations actually serve international cartels, such as the pharmaceutical industry, instead of protecting the citizen. Clearly, the current regulatory system does not serve its intended function.
Having said that, do we really want a world without laws? Libertarians dream of a return to the law of the jungle, with a Far West-type “private justice”. Apparently, the only things that the government should protect and enforce are property rights and, one would assume, the payment of interest charges to private banks. The priorities of the anarcho-capitalists are clear: nothing should stand in the way of private cartels (abolition of anti-trust laws), any type of regulations and laws that would slow down or impede business must be abolished forthwith, and finally any type of protection or entitlement for the average citizen shall be eliminated. Does this sound like an ideal society for human beings, or more like a utopia designed with transnational corporations in mind?
What kind of “freedom” is it that these “free-market” thinkers are advocating? We must be careful not to confuse true liberty with the lack of rules of the Libertarian utopia, for this is more akin to financial servitude, if not outright slavery, than to any kind of emancipation. The truth is that it takes only a little bit of scratching off the veneer of respectability and listening past the “freedom” buzzwords to see the ever-present Satanic core that underlies and informs this ideology.