Categories
free trade & free markets ideological culture too much government

Not a Problem?

Increasing public debt is bad for a number of reasons. Journalist Matthew Yglesias, speaking on vox.com, gives voice to a very different, very Pollyannish perspective: “Debt is just not a problem right now,” he says.

Why?

“The U.S. can never run out of dollars.” After all, the Fed can just print more.

That’s not an uncommon view where I live, near the center of privilege, Washington, D.C.

The video starts with an instruction: “Stop freaking out about the debt.” It sports nifty, simple graphics and comforting music. Matt Yglesias sounds convinced himself.

Nothing he says convinces me. But I’ll concentrate just on the frank inflationism.

Yglesias mentions inflation. But it’s obvious he means CPI numbers, even though he offers the short-hand “too much money chasing a fixed amount of stuff” definition to stand in for the “supply of money increasing faster than the demand for money” definition that I hear from competent economists.

But while he admits that price inflation can be a problem, what he is promoting is inflationism. That’s the doctrine that central bank fiddling with increases in the rate of money growth is the way to control the economy. And that it’s costless.

Like money cranks of the old days, he only sees the costs of not inflating the credit system.

It never enters into his ideologically-driven thoughts that maybe artificially lowering interest rates fakes out investors and consumers, getting them to make bad investments that destabilize relative prices that, when they unravel, wreak havoc.

Inflationists are folks who are always trapped by the cure they prescribe. We’re left with boom-bust forever and ever.

This is Common Sense. I’m Paul Jacob.

Categories
Thought

Ludwig von Mises

The terms inflationism and deflationism, inflationist and deflationist, signify the political programs aiming at inflation and deflation in the sense of big cash-induced changes in purchasing power.

The semantic revolution which is one of the characteristic features of our day has also changed the traditional connotation of the terms inflation and deflation. What many people today call inflation or deflation is no longer the great increase or decrease in the supply of money, but its inexorable consequences, the general tendency toward a rise or a fall in commodity prices and wage rates. This innovation is by no means harmless. It plays an “important role in fomenting the popular tendencies toward inflationism.

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Today

Solidarity, March 27

On March 27, 1981, Poland’s Solidarity movement staged a warning strike, in which at least 12 million Poles walked off their jobs for four hours. This began the decade-long process of overcoming Soviet communist rule in the satellite countries, leading eventually to the fall of the USSR as well.

Categories
insider corruption

IRS No Friend of Friends of Abe

In the better-late-than-never department, the Internal Revenue Service has granted tax-exempt status to Friends of Abe. Variety magazine calls the group “Hollywood’s largest fellowship of conservative and right-of-center independents” in an industry known for tilting 320 degrees or so to the left.

The status comes three years after the Friends filed its application. But the belated approval does not mean that IRS’s politically motivated targeting has stopped and that all legitimate applications filed by conservative groups are now being granted with only standard quotients of bureaucratic lethargy.

The American Center for Law and Justice — representing 41 plaintiffs who say IRS violated their constitutional rights to freedom of speech and assembly — attests that 13 of them have still not received tax-exempt status, with the oldest application having gathered dust since 2009. Meanwhile, the IRS officer until recently overseeing these applications, Lois Lerner, continues to plead the Fifth when asked to testify about the agency’s conduct.

We may never fully know what happened and is still happening here, given the stonewalling being done not only by Lerner but others in IRS and elsewhere in the government (like the Justice Department). But it is clear that IRS has abetted the freedom of speech and assembly of ideologically favored groups at the expense of others, and to the benefit of President Obama’s 2012 reelection campaign; and that IRS wants even more power to thus discriminate. The policies being covered up are wrong, dangerous . . . and ongoing.

This is Common Sense. I’m Paul Jacob.

Categories
Thought

Ludwig von Mises

Whoever wants peace among nations must seek to limit the state and its influence most strictly.

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Today

Gerrymander, March 26

The word gerrymander (originally written Gerry-mander) was used for the first time in the Boston Gazette on March 26, 1812. The word was created in reaction to a redrawing of Massachusetts state senate election districts under the then-governor Elbridge Gerry. In 1812, Governor Gerry signed a bill that redistricted Massachusetts to benefit his Democratic-Republican Party. When mapped, one of the contorted districts in the Boston area was said to resemble the shape of a salamander. The term was a portmanteau of the governor’s last name and the word salamander.

Appearing with the term, and helping to spread and sustain its popularity, was a political cartoon depicting a strange animal with claws, wings and a dragon-like head satirizing the map of the odd-shaped district.

Categories
Thought

Ludwig von Mises

What characterizes capitalism is not the bad taste of the crowds, but the fact that these crowds, made prosperous by capitalism, became consumers of literature — of course, of trashy literature. The book market is flooded by a downpour of trivial fiction for the semibarbarians. But this does not prevent great authors from creating imperishable works.

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Today

Boston Port Act passed, King against Vietnam, Howl seized

On March 25, 1774, the British Parliament passed the Boston Port Act, closing the port of Boston and demanding that the city’s residents pay for the tea dumped into Boston Harbor during the Boston Tea Party of December 16, 1773. The cost of the tea was equivalent to $1 million in today’s currency. The Boston Port Act was the first and easiest to enforce of four acts that together were known as the Coercive Acts. The other three were a new Quartering Act, the Administration of Justice Act and the Massachusetts Government Act.

On March 25, 1955, U.S. Customs seized 520 copies of Allen Ginsberg’s book Howl, which had been printed in England. Officials alleged that the book was obscene. The poem created an earthquake in the literary world and still stands as an icon of the ’50s and ’60s counter-culture.

On March 25, 1967, the Reverend Martin Luther King, Jr., led a march of 5,000 antiwar demonstrators in Chicago. In an address to the demonstrators, King declared that the Vietnam War was “a blasphemy against all that America stands for.”

Categories
free trade & free markets too much government

The Missing Source

The New York Times says something is missing from comments by President Obama on how government has funded scientific research. What is it? The fact that the research can be, has been, and increasingly is funded privately.

Sometimes private efforts have immediate application, as is often true in the firms of electronics, pharmaceutical and other innovative industries.

But scientific research is also funded by wealthy individuals — James Simons, David Koch, Bill Gates, and Eric Schmidt come to mind immediately — without prospect of immediate financial payoff. Such wealthy men have financed investigations of disease, “hunts for dinosaur bones and giant sea creatures,” and “innovative ships, undersea craft and giant telescopes — as well as the first private mission to deep space.”

Good thing or bad thing, these privately inquiring minds?

In light of the billions too often splurged on wasteful or bad (but politically faddish) research programs, all without the assent of the source of those billions — us taxpayers — I see private inquiry into Nature and Nature’s laws as only a good thing.

We needn’t agree about the value of any particular private project. Maybe if you and I were funding research, we’d have different priorities from Bloomberg, Gates or whomever. But when they waste their money, it’s their money being wasted, not ours. And if the research we prefer is important enough to us, what’s to stop us from raising funds from like-minded others to enable the inquiries we want scientists to pursue?

In a free society, nothing.

This is Common Sense. I’m Paul Jacob.

Categories
Today

Heilbroner mar 24

American Federalist politician, diplomat, and Constitutional delegate Rufus King was born on March 24, 1755.

American economist Robert Heilbroner was born on this date in 1919. Heilbroner was a career-long socialist who, after the fall of the Soviet Union, admitted that “Mises was right” about the unworkability of socialism.

Poet Lawrence Ferlinghetti was also born on the same day as Heilbroner.