main
  about us
  news
  topics
  author
  euroletter
  news from other sites
  links
 
 
 Libertarian Theory
  General
  Anarchism
  Capitalism
  Democracy
  Minarchism
  Nationalism
  Rights
  Socialism/Communism
 Economy
  General
  Austrian School
  Business Cycles
  Gold Standard
  Inflation
 Education
  General
  Private education
 Environment
  General
  Climate
  Energy
  Greenhouse effects
  "Greens"
 Government
  General
 Health
  General
  Abortion, Euthanasia, Suicide
  Alcohol, Tobacco and Drugs
  Cloning
  Cryogen suspension
  Food and Medicine /Right to choose your own
  Regulation
  Health Care
 Individuals
  General
 International Relations
  General
  Development Help
  Europe and EU /Uniting Europe without the Union
  Globalising
  Migration
  Secession Right
  War on Terrorism
 Interviews
  General
 Miscellaneous
  General
 Politics
  General
 Previews
  General
 Rights
  General
  Gun Rights
  Human Rights /Emancipation
  Property Rights
  Self Defence
  Speech Freedom
  Values and Norms
 Rights, Justice
  General
  Punishment and restitution
  Punishment
  Security
  War on Drugs
 Taxes
  General
  Taxes
  Social security
  Subsidies
 Communication
  General
  Censoring
  Internet Freedom
  Privacy and Encryption
 Religion
  General
  Islam
  Internet
  Investment
  War
  Politicians
  Redistribution
  Waste
  Police
 Repression and Police State
  General
  Database State
  Torture
 Activism
  General
  Conservatism
  Unclassified
 
Today: Thu, October 23 2014  -  Last modified: April, 26 2007
 Economy
26 October 2014
 
 
Do We Need a Lender of Last Resort?
by Nicolás Cachanosky
 sub-topic» General

It is not, then, that banks don’t have access to lenders absent a central bank. The issue is whether the “lender of last resort” should extend credit to banks under any circumstances or only to banks that are illiquid but solvent. If the central bank, as a lender of last resort, is just going to mimic the market, what’s the point of having one? And if the central bank is not going to behave like the market, namely, easily extend credit to insolvent banks, then it does not only add moral hazard problems to the banking market, but it also fails to add efficiency to the market. A financial market with insolvent banks that are able to subsist thanks to the lender of last resort is less efficient and stable than a market where insolvent banks need to become solvent or discontinue business (like in any other market).

 more» 
17 October 2014
 
 
Outsourcing Makes Us Richer
by Robert P. Murphy
 sub-topic» General

The logic of free trade is irresistible once a person takes the first step on its path. By effectively paying foreign workers with US dollars when they send us TVs, clothes, and other goods, we give them the purchasing power to buy American exports such as wheat and aircraft components. The opposite holds as well: If American consumers reduce their purchases of foreign-made TVs and other goods, then those foreigners will cut back on their purchases of American wheat and so forth. Ultimately, the video’s suggestion to “buy American” won’t create more American jobs in total, but instead will merely rearrange employment among sectors, making Americans poorer in the process.

 more» 
03 October 2014
 
 
Very Dry Water, Hard-Frozen Fire, and the Ostentatiously Invisible Rich
by Don Boudreaux
 sub-topic» General

In his New York Times blog on Wednesday - in a post entitled “Having It and Flaunting It” – Paul Krugman complained that America’s rich are obsessed with exhibiting their wealth in the form of “ostentatious” consumption. Indeed, Mr. Krugman asserted that “for many of the rich flaunting is what it’s all about…. [I]t’s largely about display.” And this display, Mr. Krugman alleged, “imposes negative externalities on the rest of the population.”

A mere five days later, in his New York Times column today - a column entitled “Our Invisible Rich” – Mr. Krugman gripes that the reason more Americans aren’t infuriated by today’s great income inequality is that “the truly rich are so removed from ordinary people’s lives that we never see what they have.”

 more» 
22 September 2014
 
 
Top-Rated Economies of the World Are Not By Coincidence
by Lawson Bader
 sub-topic» General

But perhaps most impressive is Hong Kong’s growth—not in people or buildings, but in actual land surface. In 1987 I walked along the Kowloon Peninsula Hotel’s harbor promenade. Since then, the city has reclaimed from the water nearly three city blocks in its desire to grow. Now, the Peninsula, while still a grand property, has only an urban promenade out its front door. On most economic freedom indexes, Hong Kong is king—among the top-rated economies in the world for the past 20 years. And it’s no wonder. Creative destruction, not whimsical history, is its modus operandi.

 more» 
14 September 2014
 
 
The Root of Inequality: The Free Market or the State?
by David S. D'Amato
 sub-topic» General

Market anarchism is a form of decentralism, a libertarian socialism that sees voluntary exchange and cooperation as solutions to the widespread inequality we struggle with today. Politicians and CEOs rather like the system we have in the United States; they depend on it, and it depends on them. The rest of us, quite unlike political and economic elites, don’t mind working for a living, aren’t asking for special legal privileges, and just want to be left free to undertake our own projects and pursue our own goals. That kind of free market offers an exit from present day inequalities, not an encouragement to them.

 more» 
24 July 2014
 
 
The Great Salt Solution
by Norman Imberman
 sub-topic» General

Today we are witnessing the devastating effects of the thousands and thousands of price controls, wage controls, rent controls and other regulations that have passed into law over the past 120 or more years, starting perhaps with the first anti-trust laws. The majority of citizens know nothing about the retrogressive domino effects of price controls and other regulations, so they constantly call for further controls whenever they are dissatisfied with anything. The government representatives, whether or not they are familiar with these retrogressive domino effects, don’t care, since their goal is to be re-elected, not to serve justice.

Let’s serve economic stability, justice, peace and harmony by calling for the repeal of all of the governmental controls in our lives. Better yet, let’s peacefully eliminate the State.

 more» 
22 June 2014
 
 
It doesn't seem to be true that inequality damages the economy
by Tim Worstall
 sub-topic» General

Which leads us to two observations: the first being that we don't actually have any evidence that inequality harms the growth prospects of the economy. The second is that even if it does whether reducing that inequality will reduce the performance of the economy depends upon precisely how we reduce the inequality. We might try price controls, rationing, import substitution, nationalisation, the Venezuelan route, or we might try a properly free market economy with a high VAT to give us the money to redistribute, the Swedish way. That latter works, in that the country is more equal (if that's something you want to worry about and we don't) and also remains competitive. The former doesn't work in either sense: but sadly if we look around UK politics we see those concerned with inequality arguing for those Venezuelan policies rather than those Swedish ones.

 more» 
15 June 2014
 
 
The Libertarian and Catholic Social Teachings
by David S. D'Amato
 sub-topic» General

Free markets don’t have to mean the particular incarnation of corporate world dominance we see all around us today. For an entire tradition, an individualist anarchism that once blossomed in the United States, free markets meant simply voluntary exchange between sovereign individuals with equal rights and liberties. If consistently adhered to, such a system would, these anarchists argued, distribute wealth and property more evenly and equitably, effectively ending the exploitation of the working poor.

 more» 
11 June 2014
 
 
It's Not the Technology That Causes "Technological Unemployment"
by Kevin Carson
 sub-topic» General

The phenomenon of capital cheapening relative to labor should raise an obvious question, but of course it does not because we have been conditioned to think of work as something we are given by the owning and employing classes in the form of “jobs” rather than something we do.

 more» 
27 May 2014
 
 
A Champion of Economic Freedom
by Michael D. Tanner
 sub-topic» General

Balcerowicz himself has contrasted the experiences of what he refers to as the BELLs (Bulgaria, Estonia, Latvia, and Lithuania) with that of the troubled PIIGS (Portugal, Ireland, Italy, Greece, and Spain). The BELLs took immediate steps in response to the recession, significantly cutting spending in an attempt to get debt and deficits under control. The PIIGS muddled through with tax increases, some spending cuts spread over a number of years, and stimulus in some cases. While the BELLs all saw an initial contraction, they recovered quickly, and their economies have emerged stronger than those of most other countries in the region.

 more» 
25 May 2014
 
 
Minimum wages cost jobs
by Eamonn Butler
 sub-topic» General

A minimum wage raises the cost of employing people. That is its whole purpose. But higher wage costs mean that employers – already under financial pressure from domestic and foreign competition, from everyday business costs, and from the costs of government regulation and taxation – have only two options. They can either hire fewer people, or toughen working conditions – cutting holidays, providing fewer breaks, spending less on the work environment.

 more» 
04 May 2014
 
 
How do we solve unemployment?
by Tim Worstall
 sub-topic» General

It appears that the correct method to reduce unemployment is to reduce unemployment benefits, increase in work benefits, abolish the minimum wage and insist that those unemployed take a job, any job, at any price.

 more» 
28 April 2014
 
 
The Sad State of the Economics Profession
by Frank Hollenbeck
 sub-topic» General

Most economists today, however, have sold themselves to the enemy. They work for government agencies such as the IMF, OECD, World Bank, central banks, or academic institutions where their research is heavily subsidized by government agencies. To succeed they have to “toe the line.” You don’t bite the hand that feeds you.

 more» 
15 April 2014
 
 
Just Money
by Samuel Gregg
 sub-topic» General

In this context, it should be mentioned that one need not be a conspiracy theorist or Occupy Wall Street activist to worry about the revolving door that exists between some sectors of the financial industry and senior positions in central banks and government finance departments. Of course, it’s hardly surprising that people with significant private-sector financial expertise will be recruited for public service in the world’s treasuries or central banks, and vice versa. Nor should we simply assume impropriety. That would be unfair. Nevertheless, the very real potential for crony capitalist trends to develop in the conduct of monetary policy shouldn’t be underestimated, and crony capitalism is, by definition, unjust and corrupting.

 more» 
13 April 2014
 
 
Just MY opinion on the ethical re-selling of rubber stamps
by Julie Pialet
 sub-topic» General

If you are a SELLER of unmounted rubber stamps, you should always give proper manufacturer credit when you know it. It is what is right and fair. It is what we ask for when we sell a huge grab bag of unmounted rubber stamps at a price low enough to allow the buyer to re-sell many of them. We specifically ask in those auctions that if they will be resold, they should be sold as "My Heart Stamps For You" rubber stamps. That is really all we can do...ASK, and then hope that sellers will be ethical enough to sell them with our name attached. Those who do, we thank you. Those who know the stamp company, but choose to market them as "unknown" for whatever reason, shame on you.

 more» 
17 March 2014
 
 
Why the Founding Fathers Made Their Own Money
by Paul Rosenberg
 sub-topic» General

The primary reason that rebels create their own currency is that monetary control is far more of a force than people realize. Baron Rothschild was not being overly flamboyant when he said, “Give me control over a nation’s money supply, and I care not who makes its laws.” Being able to manipulate a money supply is a fantastic power, affecting every part of an economy. If you know in advance that the money supply will go up (diluting its value) or contract (concentrating its value), you immediately gain a massive advantage over everyone else – and you can target this advantage to help or hurt almost any group you choose.

 more» 
15 February 2014
 
 
Digging Out
by Richard W. Fulmer
 sub-topic» General

Congress and the president must stop the spending that is soaking up goods, services, and labor, and crowding out both consumers and producers; stop the high taxes that are discouraging capital formation; stop trying to pick corporate winners and losers; stop bailing out financial institutions; stop the regulatory machine that is destroying innovation and misdirecting labor and resources; and, most of all, stop manipulating the nation’s currency.

 more» 
01 February 2014
 
 
What's Wrong with Income Inequality?
by Jacob G. Hornberger
 sub-topic» General

The real issue is the manner in which people earn their money, not the fact that some have more while others have less. In the type of economic system in which we live — a welfare-warfare state and a regulated society — many people earn their money and get wealthy in morally illegitimate ways, e.g., through political plunder and political privilege. If people are getting wealthy that way, that’s something we should object to. But that’s a different issue from income inequality.

 more» 
29 January 2014
 
 
Five Libertarian Reforms Millennials Should Be Fighting For - Part 3
by Kevin Carson
 sub-topic» General

So any agenda of gradually scaling down government should take this context into account. The first things to go should be welfare for the rich and big business, and the last should be welfare for ordinary people. If we start by eliminating all the forms of artificial property, artificial scarcity, subsidies and entry barriers that concentrate wealth in a few hands, and let free competition destroy enormous concentrations of wealth and redistribute it downward, we might not even notice whether welfare, minimum wages or food stamps still exist because they would be used by so few people as to be a moot point.

 more» 
27 January 2014
 
 
Five Libertarian Reforms Millennials Should Be Fighting For - Part 2
by Kevin Carson
 sub-topic» General

The mines of South Africa should go to the workers, they whose labor (and that of their ancestors) developed them, sometimes with slave labor. The haciendas of Latin America should go to the landless peasants. Every piece of land in the world held by a parasite with a title of nobility should become the property, free and clear, of those now living and working it. Every acre of America which is currently held out of use by an absentee title should be regarded as unowned.

 more» 
25 January 2014
 
 
Five Libertarian Reforms Millennials Should Be Fighting For - Part 1
by Kevin Carson
 sub-topic» General

The effect of the credit monopoly in the existing capitalist economy is to make capital artificially scarce and expensive to labor, so the capital-owning class is able to control access to opportunities for work and charge a monopoly price for it. As a result the number of employment opportunities is artificially scarce compared to the number of workers, so that workers are competing for jobs rather than the reverse; since the employer has a superior ability to walk away from the table, workers must accept work on the bosses’ terms rather than vice versa.

 more» 
22 January 2014
 
 
In Defense of Inequality
by John Goodman
 sub-topic» General

Let’s take expatriation. After John Templeton renounced his citizenship and moved to Nassau (where there is no income tax), the federal government imposed penalties — to discourage other wealthy people from doing the same thing. That was because the government wants to tax them. But when a wealthy person expatriates, the distribution of income and wealth becomes more equal. Should we reverse course and encourage the John Templetons of this world to get out of town? If equality is a serious goal, we should at least relax the penalties.

 more» 
20 January 2014
 
 
Who is Really Threatened by Innovation?
by Sandy Ikeda
 sub-topic» General

Another excellent economic historian, Daron Acemoglu, explains how historically people who wielded political power have feared innovation and have done all they could to stamp it out. The same holds true today. Radical, unpredictable change that comes with innovation—what Joseph Schumpeter called “creative destruction”—threatens the tight control essential to keeping political power. The state hates what it can’t control, and it can’t control innovation. When government officials talk about reimagining society or harnessing human energies or regulating unbridled capitalism, what they want is to bring pesky innovators and independent thinkers under their thumb. That is not “innovative governance.” It is the death of innovation.

 more» 
10 January 2014
 
 
The effect of rising consumerism
by Tim Worstall
 sub-topic» General

We only ever moved out of the caves because someone thought that house sharing with a hungry bear was unsatisfactory, only ever invented the car because of the rising tide of horse dung, it's the very things that we find unsatisfactory currently that drives the vast wave of innovation that has been sweeping us along these past few centuries.

 more» 
29 December 2013
 
 
Questions About and For Those People Obsessed with Income Inequality
by Don Boudreaux
 sub-topic» General

Fortunately, most Americans do not (yet) care as much about income differences as do the hand-wringing professors and pundits - a fact that itself casts doubt on the prescience and observational skills of those professors and pundits who prattle on endlessly about the dangers of income inequality. In a modern, prosperous market-oriented economy, even stupendously large differences in monetary incomes or in wealth are not so visible to the naked eye – another fact that casts doubt on the underlying theory of those who worry about income envy erupting into social strife.

 more» 
09 December 2013
 
 
Do-It-Yourself vs. the Minimum Wage
by Bryan Caplan
 sub-topic» General

So what happens when the minimum wage goes up? In manufacturing, there's little substitution into do-it-yourself, so labor demand is relatively inelastic. In services, in contrast, there's a lot of substitution into do-it-yourself, so labor demand is relatively elastic. Precisely the opposite of the Unz view.

 more» 
26 November 2013
 
 
The joy of markets
by Tim Worstall
 sub-topic» General

A commissar most certainly could (and would) decide that those properties in the most desirable area of London should only be for the use of those the commissar approved of, as happened everywhere that commissars allocated property. But even such a lauded and senior functionary would not be able to work out what they should be used for without some method of determining the relative values that the people themselves placed upon the alternative uses.

 more» 
11 November 2013
 
 
Regulation isn't the way to ensure a diverse marketplace
by Tim Worstall
 sub-topic» General

However, what is actually happening is that we're getting ever greater regulation of those financial markets. And that's a problem, for being able to deal with regulation is a fixed cost: and increasing those reduces the number of smaller players.

 more» 
03 November 2013
 
 
Markets are solving the food waste problem
by Eamonn Butler
 sub-topic» General

The counterintuitive fact is that, thanks to capitalism, we actually have a system that produces food so efficiently that we don't actually mind throwing it out if it looks and tastes a bit elderly. If only we could spread this production system to other places in the world where food is scarce and expensive because it is not produced efficiently at all. Again, you can blame governments in those countries for resisting the market economy, and our own EU authorities for trying to protect their own famers behind trade walls, for that crime – not a crime against food, but against humanity.

 more» 
24 October 2013
 
 
Would US default be so bad?
by Eamonn Butler
 sub-topic» General

The fact that the American government is up and running again is very bad news. Not for the obvious reason that the American government is bloated, self-serving, unproductive, and completely incapable of spending the nation's money efficiently. But for the fact that the budget deal simply postpones problems that should be squared up to.

 more» 
18 October 2013
 
 
7 Falsehoods about the Free Market
by Sandy Ikeda
 sub-topic» General

Just as there are timeless truths, there are also timeless falsehoods.

Here are a few of the latter that I’ve recently encountered, but there are, of course, plenty more. Some libertarians may not agree with me (at least at first) on all of them.

 more» 
11 October 2013
 
 
Take This Job
Work is the engine of the economy and the path to fulfilment
by The Freeman
 sub-topic» General

Work. For some, it’s an activity to be avoided. For others, it’s something you can’t live without. It’s not just that people work to stock the fridge and pay the bills. It’s that people work because, without it, their lives would somehow be less purposeful. If economics is the study of human action, work is a big part of thinking about economics. But it goes deeper than that, to questions about who we are as a species.

 more» 
27 August 2013
 
 
Is Macroeconomics Really Economics?
by Robert Higgs
 sub-topic» General

In short, among its many other deficiencies, as spelled out by Mises and his followers, monetarism’s most fundamental flaw is identical to the most fundamental flaw of Keynesian, Post-Keynesian, New Classical, and other theories advanced by macroeconomists during the past seventy or eighty years: not only does the theory leave out critical variables, but it is too simple, being expressed in huge, all-encompassing aggregates that conceal the real economic action taking place within the economic order.

 more» 
14 August 2013
 
 
The Futility of State Directed "Market Reform": Privatization
by Kevin Carson
 sub-topic» General

This is what the right-wing “free market” think tanks mean by “market reform.” But it’s delusional to expect anything else, no matter how much they throw around the term “free market.” It’s just as foolish to expect genuine “free market reform” from right-wing capitalists as it is to expect genuine pro-worker policies from left-wing capitalists. Trying to promote free markets or help the exploited classes through the state is like doing origami with a hammer.

 more» 
31 July 2013
 
 
The Minimum Wage is Cruelest to Those Who Can't Find a Job
by James A. Dorn
 sub-topic» General

A “fair wage” is a “free wage”—that is, one that results from voluntary exchanges among workers and employers. Government should prevent fraud and violence and allow individuals to enter into mutually beneficial exchanges under a just rule of law that protects persons and property. The minimum wage violates freedom of contract and hence private property rights; it is neither moral nor effective. It is unfair to workers who can’t find a job, especially young workers in search of a better future.

 more» 
25 June 2013
 
 
Do Markets Promote Immoral Behavior?
by Fred Foldvary
 sub-topic» General

The purpose of economic theory is to enable people to understand the implicit economic reality beneath superficial appearances. Critics of free markets observe the superficial appearances of the bazaar without delving into the ethical foundations of the free market and the economic causes of outcomes such as the boom-bust cycle. The ethical and economic reality is that markets are inherently ethical, and that they promote ethical behavior.

 more» 
23 April 2013
 
 
A PETITION From the Manufacturers of Candles, Tapers, Lanterns, Sticks, Street Lamps, Snuffers, and Extinguishers, and from Producers of Tallow, Oil, Resin, Alcohol, and Generally of Everything Connected with Lighting.
To the Honourable Members of the Chamber of Deputies.
by Fréderic Bastiat
 sub-topic» General

First, if you shut off as much as possible all access to natural light, and thereby create a need for artificial light, what industry in France will not ultimately be encouraged?

If France consumes more tallow, there will have to be more cattle and sheep, and, consequently, we shall see an increase in cleared fields, meat, wool, leather, and especially manure, the basis of all agricultural wealth.

If France consumes more oil, we shall see an expansion in the cultivation of the poppy, the olive, and rapeseed. These rich yet soil-exhausting plants will come at just the right time to enable us to put to profitable use the increased fertility that the breeding of cattle will impart to the land.

 more» 
27 March 2013
 
 
Cyprus's Big Bluff
by Robert Kuttner
 sub-topic» General

If Cyprus or Greece or Spain or Portugal (or better yet, all of them en bloc) decided to quit the euro and revert to drachmas and pesetas, they would need to block bank accounts, impose currency and capital controls, and default on some of all of their foreign debts, which would be re-denominated in the new local currency. There would be lawsuits up the gazork, but the IMF and ECB would have to step in to limit the broader damage even if they disapproved.

 more» 
11 March 2013
 
 
Economic Fascism and the Power Elite
by David S. D'Amato
 sub-topic» General

The state—the organization of the political means—is the institution that allows an idle, unproductive class of parasites to live at the expense of ordinary, working people, whose means are industrious activity and consensual exchange in the marketplace.

 more» 
03 February 2013
 
 
Not All Austerity is Equal
by Matthew Melchiorre
 sub-topic» General

Raising taxes on the private sector while government continues to gorge itself on tax-and-spend policies does not bring prosperity. Businesses undergo austerity by way of the recession-induced reduction in demand for their goods and services, yet the public sector doesn’t feel the need to tighten its own belt commensurately. Increasing the public burden upon the private sector only compounds what is already a harsh business environment. This is what most European nations have tried as their “austerity” programs, and they continue to suffer because of it.

On the other hand, the proper form of austerity closes a fiscal gap by reducing the burden of the state upon the already struggling private sector and cutting spending; this does bring prosperity.

 more» 
22 December 2012
 
 
Monopolies only work if they're not contestable
by Tim Worstall
 sub-topic» General

Which brings us to an interesting observation. Monopoly, purely and simply as monopoly, is neither a bad nor a good thing. If someone's the lowest cost producer and can supply total demand then why the heck not leave it as a monopoly? The difficulty comes if someone attempts to exercise those monopoly powers, to gouge consumers in some manner. And for many to most monopolies the exercise of such power leads to competition and the breaking of that monopoly power.

 more» 
15 December 2012
 
 
Remember innovation
by Anton Howes
 sub-topic» General

If Britain really wants sustained economic growth, it needs to radically improve the conditions for innovation. But this requires a cultural change as well as government allowing it to take place. The eminent economist and historian Deirdre McCloskey describes this as the dignity and liberty for innovation: a willingness to embrace and celebrate the creative destruction of new products and processes supplanting the old. Modernity was born when Britain went from condemning Shakespeare's Shylock in the Merchant of Venice, to honouring James Watt with a statue in Westminster Abbey. But we are in danger of falling back into the ancient distaste for commerce and innovation. As Allister Heath rightly pointed out in his address to the ASI Christmas Party, we must combat the emerging politics of envy and redistribution, and embrace the optimistic impulse of innovation.

 more» 
05 December 2012
 
 
TGIF: The Virtues of Competition
by Sheldon Richman
 sub-topic» General

At any rate, we need not choose between forms of monopoly, because we can have competition if we want it. All we need do is keep government out of all economic activity. Monopoly is not a market phenomenon, but rather the product of government privilege, which, like all government activity, is rooted in force. And we all know who has a comparative advantage in procuring favors from government. Hint: It’s not average working people.

 more» 
24 November 2012
 
 
The Goal is Freedom: Love the Market?
by Sheldon Richman
 sub-topic» General

Another benefit, which grows out of the first, is that the market facilitates constructive interaction with strangers and hence promotes peace across broad geographical areas, even globally. What deeper compliment could one pay a social system? A money-based division of labor brings people together for mutual advantage, expanding the array of goods and fostering goodwill among individuals who might otherwise view one another with fear and suspicion. Instead of fighting or hiding from one another, they are producing valuable things for exchange and relating to one another as equals, and the resulting cultural cross-fertilization has untold beneficent consequences.

 more» 
09 November 2012
 
 
Economics and the Calculation Problem
by Alex Salter
 sub-topic» General

In the end Mises and Hayek were vindicated in no less grand a forum than the world political stage. By the 1980s it was obvious that living standards of citizens in communist countries were far below those of citizens of countries which had retained (more or less) the free-exchange system. The increased internal unrest in the Soviet Union and its suzerainties became increasingly hard to ignore. The collapse and formal dissolution of the Soviet Union in December 1991 demonstrated once and for all the contradictions inherent in nonmarket allocation schemes. Only market-guided resource use—the system of free exchange—could lead to widespread material abundance. Any attempt to suppress this system, however well-intentioned, was doomed to bring about nothing but lower standards of living.

 more» 
17 October 2012
 
 
Contrary to Paul Krugman, the Broken Window Fallacy is a Fallacy
by Walter Block
 sub-topic» General

I am glad you are sitting down as you see these words, gentle reader, otherwise you would topple right over as I did when first encountered them, while mistakenly standing up on my two feet. The economic benefits of the Apple iPhone 5 do not come from its merits, merely from the fact that the introduction of this item embodies obsolescence? My goodness gracious. If this were true, then wouldn’t it be even better if the rate of capital destruction were even greater? And wouldn’t it help the economy even more if this devastation were not confined to communication implements like the Apple iPhone 5 but ranged widely over the economy, poisoning everything in its path including housing, factories, pipelines, mines, etc. In the extreme, we might as well just bomb our capital, buildings, etc., so that we are left with no food, no clothing, no shelter, no anything. Think of all the aggregate demand we would have then!

 more» 
10 October 2012
 
 
Greece, Spain and reality
by Madsen Pirie
 sub-topic» General

As riots accompany new austerity measures in Greece and Spain, the euro is plunged into uncertainty again. Sanguine observers might predict that there will be three such crises in the next year, and that there will be three emergency summits held, and three announcements of new measures to deal with the problem. On each occasion markets will respond favourably for a very short time, then gloom and uncertainty will return. Those same observers might predict a further three such sequences in the following year, and three more in the year after that. And so on.

 more» 
23 September 2012
 
 
Are We Destroying the Earth?
Transforming aesthetic disputes into value-creating transactions
by Sandy Ikeda
 sub-topic» General

Remember, though, that economics teaches us that an action is always taken by someone for something. There are no disembodied costs, benefits, and values. In a world of scarcity, John believes saving rain forests is more important than saving the whales. Mary believes the opposite. If we are to get past disagreements on esthetics–essentially differences of opinion–that can turn into violent conflict, we need to find some way to settle our differences peacefully, some way to transform them into value-creating interactions.

Imperfect though it may be, the free market has so far been the most effective method we know of for doing that.

 more» 
16 September 2012
 
 
Back to the stone age at the Trades Union Congress
by Eamonn Butler
 sub-topic» General

So yet more borrowing does not seem a particularly safe source of money to boost public-sector employment and wages. Nor is inflation. We have had too much of that too. A rising cost of living means that people's savings and pensions do not buy as much. And rising prices also confuse businesspeople about what is actually profitable: they cannot see the 'signal' of where the real demand is from the 'noise' of prices rising all around. That gave us the financial crisis: when everything seems to be booming, people make some pretty crass bets.

 more» 
30 August 2012
 
 
Statist Fallacies on Federal Taxes, Spending and Debt
by Jacob G. Hornberger
 sub-topic» General

In other words, the dismantling of the welfare-warfare sectors would restore the situation that existed before the government imposed its 50 percent, 60 percent, and 70 percent tax on people’s income to fund the welfare-warfare state. Everyone would now, once again, be free to keep everything he earned and decide what to do with it. No longer would he have half or more of his money taken from him.

Moreover, the people in the public sector—the ones dependent on the welfare and warfare dole would now be in the private sector, which means that they would be producing goods and services that raise people’s standard of living rather than living off the dead weight of tax collections.

 more» 
27 August 2012
 
 
This appalling decline in productivity
by Tim Worstall
 sub-topic» General

Now quite how much of what we can see in the unemployment and GDP figures comes from this effect is another matter. But do understand the basic point. What even The Guardian calls a "truly catastrophic performance" is what the various greens and Greens are urging upon us as our future lifestyle. They want to lower labour productivity. They insist that it must happen.

They really are campaigning that we must all work harder in order to have less.

This is neither happenstance nor coincidence: this is enemy action.

 more» 
15 August 2012
 
 
You Didn't Build that Pencil
by Jason Brennan
 sub-topic» General

Now suppose a pencil-maker claims she is entitled to or deserves the wealth she obtains through business. (To simplify things, imagine she is a lone artisan pencil-maker, rather than a factory owner.) Read’s “I, Pencil” does not refute her. Sure, that businessperson cannot build the pencil from scratch. But the market does not reward her for building the pencil from scratch. It’s not as if the market mistakenly behaves as if she created the pencil ex nihilo. Rather, the market will tend to pay her her marginal contribution or marginal product. We can still debate whether she deserves or is entitled to her marginal product. Yet, it’s not as though the market just pays her everything and fails to pay all of the other people she relied upon to make the pencil. Rather, the market tends to pays everyone their marginal product.

 more» 
17 July 2012
 
 
Market hypocrisy
by Jan Boucek
 sub-topic» General

Start with the mother of all market manipulations - quantitative easing by the Bank of England. Running the printing presses to buy up UK government gilts has slashed interest rates across the board, royally screwing honest savers, prudent investors and pensioners. Those absurdly low interest rates allow the government to escape more aggressive cost controls and steer precious capital towards mis-priced investments. Have any Committee members sent emails to anyone about this market manipulation?

 more» 
13 July 2012
 
 
Libor: The Crime of the Century
by Robert Scheer
 sub-topic» General

Modern international bankers form a class of thieves the likes of which the world has never before seen. Or, indeed, imagined. The scandal over Libor—short for London interbank offered rate—has resulted in a huge fine for Barclays Bank and threatens to ensnare some of the world’s top financers. It reveals that behind the world’s financial edifice lies a reeking cesspool of unprecedented corruption. The modern-day robber barons pillage with a destructive abandon totally unfettered by law or conscience and on a scale that is almost impossible to comprehend.

 more» 
27 June 2012
 
 
A twin track to recovery
by Madsen Pirie
 sub-topic» General

In an ideal world, think tanks and commentators would work to persuade the public of the advantages of both of these policies, clearing a pathway that politicians could walk upon. In this real world, however, there is little chance of the electorate ever being persuaded to vote for reduced benefits. It is just possible that the public could be shown that they, too, would gain from tax cuts on enterprise, and agree to support it, but only to a limited extent, and with measures far more timid that those needed to generate vigorous growth.

It is far more likely that governments will just muddle along, incurring great unpopularity for trivial cuts to entitlements, and making trivial tax cuts with one hand while increasing taxes elsewhere with the other.

This is a pity, because these twin tracks to recovery could utterly transform Britain, and do it very rapidly, too.

 more» 
21 June 2012
 
 
George Osborne on the €uro crisis
Right diagnosis, wrong prescription
by Roger Helmer MEP
 sub-topic» General

The only way that Greece and Spain and the other €uro-Med countries will get back in the game is to have competitive currencies. Within the €uro, their exports and their labour markets can never recover competitiveness. So the message for George is this: he €uro is the problem, not the solution. It is a universal bankruptcy machine. Any plan that fails to dismantle the €uro will fail to achieve recovery.

 more» 
12 June 2012
 
 
Inequality as a Revolt Against Nature
by Kevin Carson
 sub-topic» General

So long as competition is free, people respond to unequal exchange by seeking more equal terms. And so long as no barriers to market entry exist, prices above the cost of production (including the disutility of labor) provide an incentive to enter the market at a lower price. So as Franz Oppenheimer argued, the market always tends toward an equilibrium at which goods exchange at a ratio that reflects the subjective disutilities of the producers.

This is the natural tendency, obtaining so long as the actors in a market are equal and power doesn’t enter into the equation. The only way to sell goods and services at prices greater than the production cost and subjective disutility entailed in producing them, in the long run, is through the use of force to suppress competition from cheaper providers.

 more» 
02 December 2011
 
 
The Government is Expropriating Private Wealth at a Rapid Rate
by Robert Higgs
 sub-topic» General

In sum, the government’s monetary and fiscal authorities are currently engaged in the expropriation of private wealth on a vast scale. Entire classes of investors—especially people who saved during their working years and expected to live on interest earnings on their accumulated capital during their retirement years—are being steadily wiped out. Astonishingly, this de facto robbery is being committed by a government that misses no opportunity to shed crocodile tears over how single-mindedly it seeks to protect the weak and helpless among us.

 more» 
24 November 2011
 
 
Is the US Government Anti-Monopoly?
by Tibor R. Machan
 sub-topic» General

But you heard it everywhere — the US government is opposed to nasty, dastardly monopolies. Just another lie the government tells us. But at least there is some justice in the world: the USPS is bust, bankrupt, unable to pay its bills. And given its unaccommodating service to some of us, this isn’t very surprising

 more»