It wouldn't be so bad if the public could just benefit directly from the research without having to pay a company too. In this scheme, companies are glorified middlemen/marketing boondoggles. In fact, they represent tremendous inefficiencies in the economy. On the flip side, consider that government can do things that companies can't. They can run production at a loss. This is extremely important if you want to avoid things like economic depressions.
Forums unfortunately do not fully lend themselves to working through arguments like these. The only way that the government can run production at a loss is by forcefully taking resources from the people. It will do so either through direct taxation or inflation. Once that resource is depleted government will collapse and yield that it too is not immune to the law of natural consequences. Take the collapse of the Soviet Union as an example. It is unfortunate that the argument persists that either the New Deal or WW2 "pulled" the economy out of the great depression. Due to consistent government intervention the economy took a decade to restructure itself. Industries that did not produce or provide that which ordinary people could use needed to be shut down and the resources (human and otherwise) reassigned to active sections of the economy. The economy recovers once this restructuring is underway, once people have to quit their jobs as SUV sales people and instead go be hybrid car sales people. It is akin to constantly sending out fire fighting teams in an ecosystem that is dependent on seeds being exposed to extreme heat to germinate. People do not want to face the painful restructuring process and instead prolong the suffering. The above process can happen in spite of consistent government intervention but what is not valid is to say that since it happened we can only be thankful since imagine how long it would have taken without the government intervention. Saying that companies that deliver things are inefficiencies is like saying arteries are inefficiencies since they require resources and only add to the distance blood needs to travel to an organ. Now the individual will of people not "perfect" but it can organize resources faster and more accurately than any central planning body has ever proven to. |
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The government's role, economically, is to do things that private industry wont do that need to be done. The space program was an example of this. Research into medical advances that will save the lives of poor people would be a good example. Work on transportation backbones, as this is generally too large a project for private companies. Currently we are facing peak oil and without significant investments in an alternate transportation system the US is going to be in very big trouble soon. Building a new system (which would probably rely mostly on rail) is not something that is within the capability of any one company, or in their best interests, but it is still a vital project that needs to be completed.
Firstly the space program was by no practical measure necessary, it was an extreme tax load to growl at a competing state. Research into medical advances to save the lives of middle class and rich people are the only medical advances that can save poor people as prices fall through competition. To stifle the advancement race between pharmaceutical and medical companies is to stifle healthcare. The transportation backbone can and has been built by private companies. They do it faster, cheaper and safer. http://mises.org/journals/scholar/internal.pdfThe government has almost NO plan for peak oil, their idea is to kill Arabs and take their oil. In this case I agree, only something an oligarchy or government would get involved in. If you do not allow prices to reflect the true cost of oil you postpone the problem. If you allow people to solve the problem themselves prices indicate to them viable and inviable paths. If prices increase, telecommuting and commuting becomes orders more attractive than taking a car. If oil is subsidized and we keep waiting for the gov to save us we prolong and worsen the problem. Of the $ 3.5 Trillion federal budget 3 Trillion goes to Medicare (789 Billion), Social Security (702), the war machine (690), income insurance (435), interest payments (203) and federal pensions (199). 1.9 Trillion of these goes to some form of welfare that would be much better spent my simply handing it back out to Americans and letting them decide what to do with it. Note: very, very little is spent on items such as infrastructure. The science and infrastructure you speak of represented in the dept of Transportation, dept of Education, dept of Housing and urban development, dept of Energy, dept of Agriculture, NASA, the EPA, the National Science Foundation and using a stretch of the imagination, the United States Army Corps of Engineers account for a total spend of 296.2 Billion. That is a very sad 8.5% of the budget! Contrast that to the combined revenues of approx $ 4.2 Trillion of the energy, oil and automotive companies in the top 100 companies by revenue. Honestly I have more hope that Toyota develops an efficient electric car and Sony develops cheap solar panels. We've been fed the line that the government is there to give us policemen and roads, this is simply a gross distortion of a fractional truth that is used to justify an immense tax burden. "Citations" http://en.wikipedia.org/wiki/2009_United_States_federal_budgethttp://en.wikipedia.org/wiki/List_of_companies_by_revenue |
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All money is debt based. This is not really true even in a central bank system. The fractional banks protected by a central bank do create money through credit, but that does not mean all the money in circulation is debt based, just most of it. And during this crisis it has become evident that considering only the banking system as the source of money in the present monetary system will make you get the economy wrong. Understanding the present banking system is important, but there are more parts to the monetary system. If money was all debt and the banking system was the only way to create/destroy money there would be heavy deflation right now. But there is not. There is heavy M3 deflation right now. Or rather there is suspected heavy M3 deflation right now, since the fed no longer measures it. It is one of the reasons the Fed can temporarily get away with monetizing government debt. It is simply keeping trying to keep the money supply stable by creating money via gov debt instead of private debt. If you say there is money that is not backed by a debt instrument I would like to see an example? The only exception I know of is the very small pile of gold central banks still hold because they know they cannot trust each other. |
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Does anyone have any suggestions as to what a positive economic intervention might be?
Provide legal and monetary incentives to form cooperatives and associations instead of corporations. Then, when people are used to being active parts in such cooperatives and associations, progressively allow associations to replace some of the State's functions. If you just make the State disappear today, you will not get anarchy, you will get chaos. Self organization doesn't magically appear as the state disappears, it is built over time. And there can be many different outcomes, including a lot of bad ones. The State should gently steer people towards a fair organization by ensuring that such organization is already there before it relinquishes control. Of course, this is the dream of Communism, and we now that the State rarely does that even when it promises to, but still, I believe it would be a good intervention. I agree that we cant kill the whole beast in on shot. However, this might happen due to natural consequences when it collapses in on itself. A gradual closing down is much preferred. As you and I both know governments generally don't shrink unless forced to. So expecting them to gradually scale down probably wont happen. I suggest starting with the war machine and working your way towards welfare programs and then the taxation system. Closing down everything except the police over a 10 year period. |
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You can of course exploit the system yourself. Which adds a welcome libertarian scent to the situation.
All money is debt based. When you loan money to buy a house or a car it is created in that instance. The only difference between your debt and the debt the bank uses to consolidate real assets to itself is the interest rate. Banks and governments pay almost no interest and generally at a rate lower than the inflation of the money supply. Once in control of real assets bought with funny money their debt is no longer a problem.
The "good" news about this is that the same mechanism is available to you and me. We to can get loans, effectively printing money from nothing which we can use to acquire assets. At higher interest rates we need to be more selective about our asset choices but it can and has been done. We are also not at the mercy of the interest rates we are offered. Once you understand the bureaucracy a bit there are really amazing deals available.
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Hi guys,
Read a somewhat disappointing Richard Duncan article this morning in which he rightly criticizes the government propping up zombie industries but then goes on to suggest that the money could be better spent in other industries that encourage growth. I see this as a classic case of how most people view politics and economics "I think the government should <insert policy preference here>". They want to use the government's ability to coerce and the wealth it gains through taxation, to build their vision of the world regardless of whether that world is what people want or whether it is practical in any real way.
This is also what makes the libertarian view so hard to sell, how do you pitch a plan based on doing nothing? Of course the suggestion is not that nothing happens but rather that the world can self organize far more efficiently than a politician could ever plan. This in my view is what makes a politician, someone who forgets their just a human being, without perfect knowledge, and begins to imagine they can effectively manage the lives of other from a distance.
So maybe there is an economic intervention other that close all state departments except the police, drop all regulations and stop taxing that can help the economy. Does anyone have any suggestions as to what a positive economic intervention might be?
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I made this point in another thread but through it needed it's own thread.
Bitcoins will ultimately prevail against government action. Reason being that it is nearly impossible that ALL governments will attempt to make Bitcoin illegal. It is also unlikely that all governments that attempt to do this will be successful.
Considering that Bitcoin is (at least in my opinion) a far superior form of payment in most aspects to current currency product offerings, it is very likely that Bitcoin will succeed in many of the jurisdictions that allow it. In the process the price of a bitcoin would skyrocket, even if only 1% of a relatively small economy's money supply was in Bitcoin. This would further cement the success of Bitcoins.
Once Bitcoins are in use in a few jurisdictions, these jurisdictions can now effect low cost trade with one another and have given their citizens access to a relatively stable currency. Access to a stable currency will greatly benefit the economies Bitcoin is used in.
These factors combined will put pressure on other jurisdictions to accept Bitcoin as payment and eventually decriminalize it.
Owning gold was once illegal in the US and Russia, today, despite posing a greater risk to the funding mechanism of governments, gold ownership is legal again. Remember, taxes predate fiat currency. Fiat currency is a nice to have for a state, not a must have.
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There are only 2 major threats to bitcoin in the long run as I see it.
1.Government action.
Those who write libertarian theory are not always the ones who benefit from markets or even participate. Sometimes some of them make gov sound so bad that it discourages actual capitalist action. IE "Bitcoin is cool but why bother? the 'government' will just crush it"
Governments by their very nature are behind the curve, it will take them some time to make Bitcoin illegal. Even if some governments make it illegal the chances of ALL governments making it illegal is nearly zero. Due to the distributed nature of Bitcoin, even mild success in a few small jurisdictions guarantees the value of a Bitcoin.
2.Competing digital currencies.
If a whole slew of digital currencies begin to prop up everywhere then the above point will be even less of a threat since there will be more market pressure to make alternative currency permissible. However if Bitcoin will survive the evolution of currency is not certain, a superior system could supplant it.
So as a longer term investment strategy, rather keep your eye on all digital currencies and invest in the best ones.
Whatever a Bitcoin is worth now it is a fraction of a fraction of the value they will be if the currency is even mildly successful. If you buy Bitcoins today and hold them, even if your jurisdiction develops a problem with Bitcoin ownership, you can still sell your Bitcoins to a exchange in a participating jurisdiction and have the money transferred to you via more traditional means.
Fundamentally Bitcoin is an incredible idea and at today's prices akin to land giveaways in the old west.
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I'll let you pick something, I really don't know where to start.
Money is debt and is created by the banking system. The governments act as enforcement and collection agencies for the banking system. As such cooperating governments enjoy a cheap and nearly endless supply of credit. The further someone is removed from the banking system the more expensive credit becomes. (Know any chartered accountants? Ask them what they pay on mortgage interest vs what any other profession pays or what a blue collar worker pays)
The system is inherently unstable and market pressures continuously cause it to collapse under its own weight. Each time this happens the enforcement agency changes the rules of the game to ensure the game continues. The banking system has lost so much money on 3 different occasions over the last 3 decades that in each of these losses alone have been so expensive as to wipe out all profit since the beginning of western banking from the entire sector. Yet banks remain open for business. This is because it is in the best interest of the government to let the status-quo persist since it benefits by getting essentially free money. This is how it is possible for the government to run deficits for 190 out of 230 years. If they go broke the banking system cannot continue to exist so the banking system keeps bailing out the gov an the gov keeps bailing out the banking system.
Eventually (my feeling is the next 1000 days) the normal people who fit the bill for all this will reach their capacity to continue funding it and it will begin to drastically collapse in on itself. Then all these arguments about deficits being good or bad, all these crazy taxes being necessary or not, the idea of debt being a problem, will be put to rest, until people again forget how they got here and begin again...
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A sign of getting old: Even though it's been almost ten years now, I still can't hear the phrase "Homeland Security" without feeling that I am reading a dystopian science fiction novel.
Look at the bright side: you can vote to try to get rid of that 1984 crap. Members of the rest of the world can only watch and despair. Yes if only there was a leader who could make things better, who could promise change, but not the old kind of change, a new kind of change, a change that people can believe in! ;-) |
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I could understand why you would want to run a secretive exchange especially in a country like China.
If I were in a bad situation I would see the risk of an anonymous internet personality as far lower than a blatantly oppressive government. I would probably test the individual first, by giving them small amounts and seeing what happens. Also if wanted to trade large amounts I would not trust only one broker.
From my side is anonymity was required I would also do everything within my power to ensure that my identity was not known to the trader.
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Bro that is really a horrible article, it incorrectly explains a simple topic in highly complicated terms. i know mises, austrian school, all your other links. i just try to point out where goes the author wrong? the theory is incomplete (ignoring debt servicing, use of money as store of wealth by others, just to name the first two that i found) no offense, i hoped for more feedback than 'watch those movies again' Sorry then, I wasn't clear on why you posted it. Did you want to point out that the government has a view similar to his? Did you want comment on the article? I'll gladly comment but the article is so long and full of holes that we would need to narrow it down to some part of the article. |
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i think it relates somehow to this understanding of money, monopoly on money/us $ and that government must spend money first so that citizen and companies have some of them, to pay taxes. (simplified) http://pragcap.com/resources/understanding-modern-monetary-systemthe author even goes so far that he claims periods of budget surplus are causing economic depressions. Bro that is really a horrible article, it incorrectly explains a simple topic in highly complicated terms. Try these resources: www.mises.org is a much better resource if you want to learn about economics. Also pick up a copy of Michael Maloney's "Guide to investing in gold and silver" And for a really fun introduction to the monetary history check out "Money as debt" on YouTube http://www.youtube.com/watch?v=vVkFb26u9g8Also check out Renaissance 2.0 on YouTube by Damon Vrabel http://www.youtube.com/watch?v=l37RhdFGVsM |
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A sign of getting old: Even though it's been almost ten years now, I still can't hear the phrase "Homeland Security" without feeling that I am reading a dystopian science fiction novel.
Amen |
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"Men were so stupid; they didn't understand the reality of life at all. Love was what mattered. Love of one for one. The touching of hands, the touching of hearts. The warmth of belonging, the joy of sharing. There would always be tyrants. Man seemed incapable of existing without them. For without tyrants there would be no heroes. And man could not live without heroes."
~Renya, pg. 195
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Also true but what I found surprising was that Anarchy existed for hundreds of years in many regions before warrior classes could be established so that they could gain dominance and form monarchies.
This is true, but the areas that anarchy existed could only maintain this politcal condition if there was some kind limiting factor to the spread of the monarch's control. Usually this was so only in areas that were geographically undesireable to live in, or simply could not sustain a large enough population to coalese into a city-state. Such areas included high mountainous regions, various degrees of desert, or extreme latitudes. Basicly, a natural anarchy has only existed peacefully, throughout history, beyond the political reach of society. I've heard examples, although I have not researched them up thoroughly, of anarchy existing in Ireland, Iceland, Scotland, and large parts of Europe before there were monarchs. As I understand even monarchies are relatively new developments in these regions taken against the timeline of human presence. |
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You are correct, more or less. However, and I'm know I'm being anal here, what you are describing is a currency unit; not money. And the use of a money arises first in the absence of coercive forces such as a government. A socialist anarchy is impossible, because capitalism is the natural extension of individuals exercising their right to trade the fruits of their own labors. If a socialist society were to form from an otherwise anarchist society, one of two things will happen. Either the best efforts of the majority (seeking the greater good) will be undermined by a minority (seeking only their own best interests), such as was entertainingly described in the movie Star Trek Insurrection, resulting in the rise of a warrior class (and therefore a peasent class) ultimately leading to the formation of a monarchy.(all warrior classes form rank structures, the guy with the highest rank is the monarch by default) Or the first generation of social anarchists will wisely foresee this flaw in their own logic, and found some institution intended to organize the collective forces within society to oppose the rise of gangs or any other warrior class that is not beholden to the socialist collective. In which case, they have just established a government, and are no longer anarchists.
Love it!! True anarchy as a political structure is unsustainable, and will always lead to something else entirely. Most self-described anarchists are aware of this, and therefore are not really anarchists; but instead are whatever kind of idealist that they expect would come from the anarchy. Anarchy is simply a temporary condition; the time period between the final collapse of the current condition and the initiation of the intended political structure. Karl Marx was, himself, aware of this and regarded a forced state in anarchy as a necessary step towards his communist ideal. Historicly, they are all wrong. Anarchy has always led to the formation of warrior classes taking control of territories, whether you call them gangs, warlords or freedom fighters.
Also true but what I found surprising was that Anarchy existed for hundreds of years in many regions before warrior classes could be established so that they could gain dominance and form monarchies. |
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Like the post.
Anarchy will end up in extreme capitalism flowing from the natural consequences of non-aggression. The only question is whether non-aggression is possible, not its outcome. So I agree with the right - anarchy argument. If your left - anarchy friends ever did have a book (something they would need or starve) they would soon be screaming "burn the book" if they didn't learn anything from how useful it proved.
I noticed you called Bitcoin Fiat. The word Fiat is from the Latin meaning "Let it be done" and as I understand denotes a decree from a government. So a fiat currency can only exist when a government decrees it to be such.
However if a bunch of people simply decreed that something should be currency I guess that could also be called Fiat. Since it is the will of the people to "decree" gold as currency in times of trouble, then bitcoin is no more fiat than gold if it is decreed as currency by the market.
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State debt and municipal debt combined are only 3.2 Trillion. I love the way you can describe a debt of $10,000 per person (including babies) as "only" 3.2 trillion. I didn't mean to downplay it. To further put it into perspective, the official obligations, both direct and indirect, no longer make it possible for the federal government to continue in its current form. Even if we only take the official debt of 14 Trillion and imagine interest rates rising to 10% (where they were for much of the late 70s and early 80s) then the US enters a position where only the interest portion of the debt rises so dramatically while at the same time causing such a steep decline in tax incomes that all federal taxes as they stand currently will go exclusively to interest payments. That is taking only one element of the situation into account. One could sketch about half a dozen of these and back most of them with historic data. The situation is extremely dire and the babies you speak of will live in a world very unlike our own. I don't believe any political will exists anymore to stop this speeding locomotive. There is luckily a lot we as individuals can do to prepare ourselves and our immediate communities. Check out www.ChrisMartenson.comOr maybe it would scare some life back into the populace.
I agree, it would scare them in the most constructive way possible. It would be upsetting, yet not fatal and they would most likely be able to correctly assign it to certain of their own behaviors and that of their elected officials and appointed CEO's |
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