Saturday, August 29, 2020

Reality intrudes.

There is NOTHING that government can do to help the economy other than remove barriers to wealth creation and preservation that it itself created and allow the people the freedom to pursue their own ends. Since government creates nothing itself, all interventions interfere with what the people themselves desire and are nothing more than transfers of wealth for the benefit of some and the destruction of wealth for all.[1]
Helicopter money certainly does help people in the very near term. But for the long term it's start evidence for the truth of the proposition that government poses as the solution for the problems it creates.

Central banks around the world are in pure panic mode, stupidly reacting to problems with monetary gimmickry when sooner or later they and we know that the repo man will come knocking because productive activity is as scare as a non-racist white man and monetary excess has jacked up inflation and the debt service burden.

The road back to economic sanity is to give up our century-long infatuation with funny money and leftist fairy tales. Politicians think they can game markets. The banksters think wealth is a matter of dollars in the back pocket. And marxists, AKA progressives, think they have a lock on wisdom and common decency. However, Jethro, Juanita, Guiseppe, Hans, and Svetlana know its about offering products and services that customers will pay if only the government will take its hand out of their pockets and get out of the way.

It's proving to be tragic that in the U.S., one of the most economically productive countries in the world at one time, the understanding of capitalism as being a shiny, powerful engine subject to appropriate state regulation of hucksterism, monopoly, and contractual relations has faded. No, capitalism IS the selling of swamp land in Florida and the off-shoring of tens and thousands of American factories.

It's as though a cardiologist lost sight of what a healthy heart is and came to see it only in its various diseased manifestations -- hearts with infarctions, hearts with arrhythmias, hearts with embolisms, hearts with valve disease. The favored locution of the hour appears to be "neo-liberalism," the heartless return to the worship of profits and child labor free of all compassionate ameliorations so helpfully and generously offered by the left.

Whatever the descriptor, it's intended to devour or hide the fact that there is a healthy, functioning version of economic relationships that works -- with necessary and appropriate regulation -- wonderfully.[2]

[1] "Bad Monetary Theory Enables Disastrous Government Policies." By Patrick Barron, ZeroHedge, 8/27/20.
[2] "Crony capitalism" and "monopoly capitalism" are actually useful terms to describe a deformed capitalism. The first describes the deformation effected by wealthy people being able to purchase special favors from the ostensibly neutral government overseers and thus buy a departure from market realities defined by economic actors with skin in the game and constantly assessing cost, risk, and reward. The second the situation where government abdicates its oversight role and allows especially successful businesses to acquire overwhelming market dominance that damages and hinders smaller enterprises.

We have both these phenomena in spades at this very moment and the descriptors are useful because they hint at the cause of the deformation. But, of course, the disease is sold as the natural result of "capitalism" and leftists would rather set their hair on fire than admit that there is a way to organize any economy that is compatible with wealth creation for everybody and liberty. As we know, that is because what they are selling is something radically different, unsustainable, incompatible with liberty, and dishonest -- socialism.

Central banks don't even have such a 50-cent term to justify their actions. They have always acted to enrich the bankster class and now are just in pure panic mode to justify their existence. And it's unraveling.

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