Decision 2012 and the Economy

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It is a fact of history, which cannot be denied, that government is dangerous to liberty as well as to prosperity. Even the checks and balances of our political system do not always restrain the hand of naked government appropriation. Even the U.S. Constitution appears, at moments, utterly helpless to prevent the negation of property rights, or the passage of arbitrary laws. And now that the United States is on the brink of yet another major election, some of us tremble at the prospects. Since all the traditional understandings of the Constitution are being eroded away, and government intervention into the financial sector has become pervasive, we cannot suppose that the system has much time left.

In his book, Liberalism in the Classical Tradition, Austrian economist Ludwig von Mises wrote, “All those in political power, all governments, all kings, and all republican authorities have always looked askance at private property. There is an inherent tendency in all governmental power to recognize no restraints on its operation and to extend the sphere of its dominion as much as possible.” And we must admit that the United States government, under both major parties, has continued to move in the direction of violating property rights. Many of the crises occurring today were caused or exacerbated by government intervention – from the bubble in the housing market to the debt crisis. But how is government held accountable? In fact, at every turn, the government gains more power from the crisis as market freedom is increasingly infringed upon. The official justification is that the economy has gone haywire and something must be done to prevent a total collapse.

In truth, the government has gone haywire and the economic mayhem we see today is a reflection of this. It is a reflection of too much regulation, of too much taxation, and too much intervention. “If only private property did not stand in the way!” Mises wrote sarcastically of the interventionist mindset.

What are the evils associated with private property? Simply, that private property signifies a sanctuary in which the individual is free from the control of government officials. Here a man’s home is sacrosanct. His business is sacrosanct. His economic relations are sacrosanct. And here is the chief obstacle to absolute power. How irksome to those who would hold nothing inviolable, whose arrogance would like to control everyone and everything; and who fervently believe, without the least humility, that they know best. With such people about, private property must inevitably find itself maligned. And so it is.

The election of 2012 is sometimes presented as a contest between two divergent ideas of government. On the one hand, there is the supposed Party of Capitalism. On the other side, there is the Party of Socialism. Perhaps the truth is better explained as follows: Both parties are pandering to an increasingly entitled and narcissistic population. Both parties field candidates who promise benefits to voters – benefits bought and paid for by borrowing money, or by debasing the currency, or by taxing us into a new Dark Ages. Don’t worry, if everything collapses the government will save you. But the government has been causing the collapse, and cannot save itself. Should the currency inflate away, our nuclear deterrent would fail, our social system could collapse. What would the government do then? And how would the government pay for doing it?

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About JR Nyquist