Spoken Mises

John T. Flynn — journalist, author, and master polemicist of the Old Right — is highly unusual. He started out as a liberal columnist for that flagship of American liberalism, the New Republic, and wound up on the Right, denouncing "creeping socialism." What is unusual about Flynn is that instead of being seduced by the New Deal and the Popular Front into supporting the war, Flynn was led by his thoroughgoing antiwar stance to challenge the developing state worship of modern liberalism. Flynn's final and definitive shift from left to right was completed with the writing of his greatest work, As We Go Marching. In this book, Flynn stepped back and tried to see the trends he had been fighting — militarism, centralism, leader worship — as the interlocking components of a system.

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Who is John T. Flynn? (1.29 MB)

How does Bernanke jump-start the banking system? Bernanke decided that, instead of waiting for timid customers at the discount window, he would announce a series of auctions called Term Auction Facilities, or TAFs, where the high bidders would get the bank reserves. This maintains the bank's privacy, or at least reduces the onus of approaching the discount window, and it guarantees that new reserves will enter the system. Some commentators say that the Fed has merely taking charge, rising to the occasion, and attempting to "shake it loose together." However, others would say this is all an act of desperation. If desperate circumstances call for such drastic actions, then Bernanke's actions — rather than words — indicates that we are in desperate circumstances. Stick around to find who's right and who's wrong.

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Bennie and the Monetary Jets (1.37 MB)

Many economists since Mises have noted that every time the Fed manipulates interest rates it creates bubbles of malinvestment. In addition to reallocating scarce resources in inefficient ventures, one of the problems with artificially lowering interest rates is that, ultimately, someone has to pay for these subsidies. As with every freebie provided by the government, some faceless individuals will ultimately share this unjust burden. And over the course of the Fed's more-than-90-year existence, individuals with dollar-denominated assets have borne the brunt of this devaluation as the dollar is worth about 5% of its original 1913 value.

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No Silver in the Silver Lining (2.15 MB)

If the political prediction markets are right, we are going to end up with a presidential contest between two people who agree on the pressing need to expand the entire welfare-warfare state. They can argue about priorities, but they agree on the overall goal. With the campaign lacking serious issues, something tells me that the great American obsession over race is going to play a major role, which is gravely unfortunate since the discussion is unlikely to be enlightening. Of course it's all politics, that is, equal parts dissembling and illusion, and designed to confer on some groups more power over other groups. But it does raise important questions: what is racism and how can we tell if it exists?

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The Hegelianism of the 2008 Election (1.96 MB)

Every Republican I've spoken to is mystified that John McCain has sewn up the Republican nomination. For his entire career, he has been more statist on both domestic and foreign policy than even the typical Republican. He has been considered a "liberal," and not in a good sense. He doesn't share any of the values that are said to make up the Republican consensus on economics or culture or religion. His personal baggage is heavy and a mile long. He had no dedicated constituency within the party. Of course I'm not talking to the run-of-the-mill Republican. There are vast hordes of these people who have never read a book and vote only by the most sordid political instinct known to man. McCain is their candidate. It comes down to one thing only: the simple-minded, unthinking impression that he is a war hero and, more than anyone else, has what it takes to smash the evil foreign peoples who want to kill us. In short, he appeals to the militaristic, nationalistic impulses of the base Republican base.

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Triumph of the Red-State Fascists (1.57 MB)

Modern "liberals" who advocate the view that government should provide us with the necessities or alleged necessities of life rarely appreciate that this assistance rests on a system of mass robbery and enslavement that is highly inimical to their professed belief in liberty. In fact, the advocates of such policies present them in quite the opposite light, as enhancing our liberty. This contention rests on the conceptual claim that liberty requires certain of our most basic needs to be satisfied, if necessary by the actions of others. Adherents of this view assert that "the starving man is not free".

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Is the Starving Man Free? (2.72 MB)

Note that no drought ever officially ends. The papers are packed with warnings of impending doom during the worst of it. But when the torrents of rain come — and they invariably do, eventually — there is no press release that says something along the lines of: "Praise Be to God, the drought is over. Use as much water as you are willing to pay for!" Bureaucrat International has a common feature: loathing of "consumerism." Whereas people want to have choice over how they spend their money, bureaucrats want us to suffer constantly, and be intensely aware of what we use, trusting not the price system to determine our consumption patterns but rather obey regulations and strictures.

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Rain, Rain, Go Away (1.35 MB)

Politicians espouse numerous theories about the cause of this country's economic woes; seldom however do these officials look below the surface: the roots of our economic ills can be traced to central banking and our present monetary system. The Federal Reserve claims to manage our money; instead it makes our money worth less and less every day. It has generated continuous and worsening business cycles and lowered our living standards.

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Money, Banking, and the Federal Reserve: the Complete Transcript (6.87 MB)

According to Bernanke there is good evidence that cash that goes to low- and moderate-income individuals is more likely to be spent in the near term — hence, from this perspective, it is going to be beneficial for economic growth. Only if the amount of money in the economy increases, all other things being equal, spending in money terms will follow suit. However, the spending increase in this case is not on account of some multiplier but because of the increase in the money supply. The increase in monetary expenditure that results from an increase in money supply cannot produce the expansion in real output, contrary to the popular story. All that it will generate is a reshuffling of the existing pool of real savings. It will enrich the early receivers of the new money at the expense of last receivers. Obviously then, a loose monetary policy that is aimed at boosting consumers' demand cannot boost real output by a multiple of the initial increase in consumer demand. Not only will loose money policy not lift production, but, on the contrary, it will impoverish wealth generators

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Is Something Out of Nothing Possible? (2.61 MB)

Privatization is the only hope for renewal of once proud cities, writes John Chapman. In his 1944 book entitled Bureaucracy, Mises distinguished between "bureaucratic management" and "profit management." He explained that neither incentives nor exploitation of useful information are optimal under bureaucratic management, and by definition there could be no rational calculation via profit and loss. Hence, coordination of resources will never be optimally efficient. That is to say, it is in the very nature of government management (bureaucracy) that it will be inefficient, and prone to corruption. Conversely, after privatization, operations and cost efficiencies improve because once incentives are in place and aligned, and people are empowered and incited (by the lure of profit) to utilize "particular knowledge" of markets, methods, competitive conditions, et al., performance improves.

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The Privatization of Public Services (7.43 MB)