Libertas

“The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.” ~Henry Hazlett

Henry Hazlitt (1894 – 1993)

Too many times we pick a policy for what it promises to do and not think through the means to that end or the long term effects.

Is is proper to take from one group of people by force to give to another group of people? Yes or no?

When I ask proponents of Obama Care that question, I never get an answer. It’s as if the question were never asked. They never admit it’s right or wrong. They just ignore the question and continue to call for universal health care and other government programs.

When I question how the government is going to pay for these programs, I am likewise ignored. If I do get an answer, it’s some silly fool who will say, “I’m happy to pay my fair share.” which really means paying less while others pay more. Others seem to think government money is manna from heaven.

I try to tell them that the three ways to fund the programs are:

1) Taxation, the use of force to take money from one group to give to another, with, of course, a major cut taken by the government. Would anyone think it just, moral, or virtuous to go out on the street, go up to a stranger, demand money with threat of force, take a percentage the money, and give the rest to another person AND claim to be compassionate and humanitarian? No one in the two transactions (the original theft and the hand out) has committed an act of virtue or charity. But that is what the government does on a large scale. Does that make it right because more people are involved?

2) Debt, placing the burden on our children and grandchildren. It is impossible to pay off the debt. Already China and other holders of our debt are trying to get rid of dollars, because they know the dollar is unsound. But even if it were sound, isn’t it wrong to place the burden on later generations who had no say in the matter? Does any parent go into debt thinking, “I’ll let the kids and grandkids pay for this”? How is that right?

Ernest Hemingway (1899 – 1961) “The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.”

3) Inflation, creating money out of thin air. There is a reason counterfeiting is illegal. It devalues the “legal” money. When government does this, it and the major corporations get to use the new money when prices have not yet gone up. However, by the time the new money has reached the poor, prices have risen. It is a major tax on the poor. The government, banks, and major corporations steal the wealth from the middle class and poor. The very people who care about the poor support policies that will rob the least advantaged of what ever wealth they have. The poor are usually on a fixed income, but prices increase at a greater pace. The burden will be on the poor no matter how much they claim to tax from other sources. Fiat currency is the main source of revenue for the government, precisely because no one sees how a increase in sugar or bread is paying for war and entitlements.

All three ways of paying for this and other government programs is wrong.

People cannot pay anymore in taxes, that will lead to more debt and inflation. This is what the government does to hide it’s looting of the people.

It cannot last forever. There has never been a time in history where fiat currency has not failed and led to horrendous consequences. Devaluing the money always leads to disaster.

The country is already bankrupt. The wars and entitlements will speed things along. This is not partisan. It is sound economic logic.

Please Comment.

Recommended:

Economics In One Lesson by Henry Hazlitt

That Which Is Seen And That Which Is Unseen by Frédéric Bastiat