Archive for July 30th, 2009
Thank you, Ron Paul. Over the last few years I have been studying the Austrian business cycle theory and as such, almost every one of my preconceived notions about America, the world financial system and governance itself has greatly changed. I used to have an almost uninhibited American pride and damn near religious belief that America was “God’s democracy”, and as such – here to stay. This was nothing more than extreme hubris and pride. This hubris and pride lead me to support things like; the Iraq war, tax cuts without sufficient program cuts. I mean, we could do quite litterally – anything.
This is essentially what we libertarians are battling today; The belief by power makers that “we can afford it”. Whatever it is, we can always afford it.
While watching the PBS documentary on the economic crisis, I was amazed at how even incredibly bright, gifted economic thinkers failed so miserably at understanding the causes of the crisis. Nobody better illustrates this than one Henry Paulson – the guy who’s name is on your dollar bill. Ole’ Hank was a good ole’ Republican and Goldman Sachs man. A “free-market” prophet if there ever was one. He believed in and wanted to not allow moral hazard in the marketplace. He was “forced”, however, to give in and bailout companies thereby destroying any and all principles he ever believed in.
What would cause him to do such a thing?
The most succinct way I explain this is – He thought we had an open, honest market. That’s where his (and almost every other politician and economists) go wrong on this economic collapse. His principles only work if you actually have a free market, not what we ACTUALLY have - an over regulated, over manipulated and overly Government mandated market. That is – there is no free market and there hasn’t been for a very long time. All it takes is a little interference to create economic collapse. So once you start interfering, you have to interfere more and more until you get the results you want.
In a true, open and free market we never would have been in this mess to begin with. The GSE’s, or Government Sponsored Entities such as Fannie and Freddie would not have been able to amass some 5+ trillion dollars worth of mortgages and thereby create the mortgage collapse we see today. Government created this mess.
Indeed, almost every-single problem within the economic crisis, traces it’s routes back to government or the fed. The sooner we realize this in the mainstream world of media and books, the sooner we can rebuild our country based on sustainable principles of freedom, peace and prosperity (sound money).
