“Our Marx”: The Great Herbert Spencer. Really!

When so called classical liberals try too hard to write an article with a catchy headline! Such headlines are not helpful for the cause!

The headline is pretty absurd! I bet Ludwig Mises is spinning in his grave given such nonsense!

“Our Marx”: The Great Herbert Spencer | Mises Institute

Who Was Ludwig von Mises?

Recommendable!

Free Market Masters: Ludwig von Mises

Recommendable!

About Two Essays by Ludwig von Mises

Recommendable!

"Like virtually all of the work of Ludwig von Mises, these two essays, his 1958 Liberty and Property and his 1950 Middle-of-the-Road Policy Leads to Socialism are timeless. They are as important now as they have ever been and will increase in relevance as the growth of government continues almost unabated. ..."

Why Everyone Should Read These Two Essays by Ludwig von Mises | Mises Wire: 

Zu Ludwig von Misses Die Gemeinwirtschaft von 1922

Empfehlenswert! Vor über 100 Jahren schon hat der Ökonom Ludwig von Mises nachgewiesen das Sozialismus eine Illusion ist und das der Kapitalismus in vielerlei Hinsicht weit überlegen ist! Hundert Jahre später sind viele Menschen immer noch nicht klüger!

"Sämtliche Spielarten des Sozialismus wurden bereits im Jahr 1922 von Ludwig von Mises widerlegt.

Im Jahr 1922, also vor 100 Jahren, legt Mises sein Buch Die Gemeinwirtschaft. Untersuchungen über den Sozialismus vor. In diesem Werk unterzieht Mises den Sozialismus und all seine Spielarten einer tiefgreifenden kritischen Analyse mit den Mitteln des wissenschaftlich-nationalökonomischen Denkens.

Dass der Sozialismus zum Scheitern verurteilt ist, dass er unmöglich ist, liegt nicht etwa daran, dass die Menschen moralisch zu niedrig stehen, dass man sie nur «besser» machen muss, damit die sozialistische Traumwelt Realität werden kann. Der entscheidende Grund ist, dass eine Wirtschaftsrechnung im Sozialismus undurchführbar ist. Im Kapitalismus ist es den Unternehmern möglich, eine Wirtschaftsrechnung durchzuführen, weil sie auf Marktpreise zurückgreifen können. Ihr Gewinnmotiv stellt sicher, dass sie die Verbraucher mit den Gütern versorgen, die am dringendsten benötigt werden. Völlig anders stehen die Dinge im Sozialismus. Hier ist die Wirtschaftsrechnung ganz und gar unmöglich. Fehllenkung und Verschwendung von knappen Ressourcen sowie wirtschaftliches Chaos und Verelendung sind die unabwendbaren Folgen.

Das Eigentum ist in einer freien Marktwirtschaft das Resultat friedvoller und produktiver Kooperation zwischen Menschen. Der Sozialismus attackiert diese Ordnung, indem er das Sondereigentum an den Produktionsmitteln verstaatlichen will. Das Sondereigentum der Produktionsmittel zementiert mitnichten die existierenden Besitzverhältnisse, wie die Befürworter des Sozialismus behaupten. In einer freien Marktwirtschaft muss der Eigentümer seine Produktionsmittel vielmehr in den Dienst der Nachfrager stellen. Er muss so gesehen sein Eigentum jeden Tag aufs Neue erwerben. In einem freien Markt gibt es daher auch keinen unverrückbaren, auf ewig garantierten Besitzstand, wie etwa im Feudalismus [oder Sozialismus]."

Liberales Institut - 100 Jahre Gemeinwirtschaft

eigentümlich frei: Warum der Staat immer mächtiger wird

Sehr empfehlenswert! U.a. Ludwig von Mises Interventionsspirale!

Ludwig von Mises Human Action Documentary

Recommendable, but this video has many shortcomings! E.g. we learn fairly little about von Mises ideas! However, this documentary deserves credit as Ludwig von Mises is not exactly a hot topic.

Von Mises wrote e.g. a book titled Liberalismus (1927, German, but also available in English translation), which was not mentioned at all in this documentary, although it is very recommendable! Among other things, von Mises warned about the rise of brutal dictatorships like communism and fascism!

Unfortunately, we also learn little what e.g. Friedrich von Hayek (a famous student of von Mises) or Milton Friedman thought about von Mises!

Many Economists Are Bankrupt

Posted: 7/4/2018

Introduction

I have previously posted several critical blogs here about economics and several prominent economists here.

Summary

Here is an attempt to summarize:

1. Many are not dispassionate scientists, but active advocates for big government, central planning, and mercantilism. They are the mouthpieces for government programs
2. Rarely do economists criticize government for economic recessions although governments are often heavily responsible for their cause and/or their severity and/or their prolongation
3. Many are socialists in what they do and in what they present in public
4. Humanity does not really benefit from many economists

A Supreme Example

Government mandated minimum wages:

1. How many economists openly protest the introduction of any new minimum wages or any hikes?
2. How many economists have ever advocated to lower minimum wages?
3. Why is it not taught in public (government) schools that minimum wages are a form of government price controls? That it is one of many grave government interventions in economic affairs that severely interfere with the working of free markets and the choices of free individuals

Time For A New Era Of Enlightenment

Past Great Minds

Just a few names:

Friedrich Hayek died 1992.

Ludwig von Mises died 1973.

Alexis de Tocqueville died in 1859.

James Madison died 1836.

Thomas Jefferson died 1826.

Benjamin Franklin and Adam Smith died 1790.

Where are the new great minds?

Recent Lessons Of History Forgotten

Ronald Reagan said it best: “Freedom is never more than one generation away from extinction”. How true!

World War II or the victory of freedom over totalitarian regimes. Those who witnessed it have either died or are very old by now. However totalitarian regimes are still around.

There are fewer totalitarian regimes than compared with a few decades ago, but Big Government is on the march and ever expanding in many developed countries.

Ominous Omens Of Our Times

We have entered an era of ignorance, arrogance and delusion of government power:

·         European politicians breach major European contracts with impunity, the courts look the other way.

·         US and European politicians and bureaucrats bail out so called too big to fail financial companies instead of allowing bankruptcy to take its course.

·         Major central banks lowered twice in a decade key short term interest rates to recklessly low levels for too long fueling speculation and indebtedness.

·         Irresponsible politicians in the US and Europe have run up government debt to incredible peace time levels.

·         In the 21^st century, a US President in collaboration with a democratic majority in the US Congress tries to outdo the horrible New Deal of Franklin Delano Roosevelt by, e.g., further nationalizing the health care system of the USA.

Ludwig Von Mises: A Definition Of Free Markets

Free Consumers Are In Power

Excerpted from chapter 14 of von Mises's book “Money, Method, and the Market Process” (Emphasis added):

“Permit me to recapitulate some well-known facts.

While under precapitalistic conditions superior men were the masters on whom the masses of the inferior had to attend,

under capitalism the more gifted and more able have no means to profit from their superiority other than to serve to the best of their abilities the wishes of the majority of the less gifted.

In the market economic power is vested in the consumers. They ultimately determine, by their buying or abstention from buying, what should be produced, by whom and how, of what quality and in what quantity.

The entrepreneurs, capitalists, and landowners who fail to satisfy in the best possible and cheapest way the most urgent of the not yet satisfied wishes of the consumers are forced to go out of business and forfeit their preferred position.”

Some Remarks

The more gifted and more able in economic affairs, I would qualify. Entrepreneurs are also consumers. It is not a one way street. Vice verse consumers in a free market can become entrepreneurs at any time.

Big Government Hurts Consumers

An example out of millions of existing examples: This Summer 2012, the EU Commission forces wireless carries in the European Union to charge low and fixed uniform roaming fees to their customers. Supposedly, European consumers paid too much calling home when they were on vacation somewhere within the EU.

According to von Mises, free and responsible consumers should have abstained from buying those calls thereby forcing wireless carriers to reconsider their pricing. The EU Commission should have better thought about ways to intensify competition to drive down prices. Such government price controls only undermine the workings of free markets, stifle competition and innovation and much more. Such measures are myopic, too expedient, populist, and very dumb. Consumers are reduced to recipients of big government’s handouts.

Obamacare Is Nothing But Nationalization Of Health Care

The Affordable Care Act Is

Full Of Unconstitutional Mandates

I am still surprised that the many other, interdependent mandates of the Patient Protection And Affordable Care Act (ACA) were not more vigorously constitutionally challenged. Thus, it has also escaped my attention how pernicious and unamerican this act is.

Here are the major mandates of the ACA, I am aware of:

1.       The individual mandate to buy health insurance

2.       The employer mandate to provide health insurance

3.       The guaranteed issue mandate aimed at health insurance companies

4.       The community rating mandate also aimed at health insurance companies

For sake of brevity, I will not comment on each of these mandates.

Each one of them is a massive intervention in individual liberty, free enterprise, and freedom of contract. None of these massive interventions is necessary. Only Big Government in collusion with corporatism are able to come up with such a horrific law.

Successive Nationalization Of Health Care In the US

Even today, major parts of US healthcare are already nationalized. Here is a quick rundown:

·         Health care for older Americans (Medicare)

·         Health care for the poor (Medicaid)

·         Health care for veterans

·         Health care for children in need (CHIPS and SCHIP)

Thus, a huge number of Americans have been already covered by government run health care before Obamacare was passed.

There is no doubt in my mind that this law would lead to basically a further nationalization of health care in the US. Private insurance companies would be not much more than an extended federal bureaucracy. Every time things would not develop as envisaged on Capitol Hill more intervention would be imposed (vicious spiral of intervention according to Ludwig von Mises). The penalty tax will surely be raised as soon as too many Americans do not comply and so on.

The New Deal Reloaded

Only seventy years after the New Deal, Democrats forced this continuation of 20^th century all powerful government on its citizens. Who thought that Fascism or Socialism are in the dustbin of history, should quickly wake up. The Statue of Liberty is inconsolably weeping.

Privatize Deposit Insurance

The US Experience

Federal Deposit Insurance (FDIC) was one of the many big government measures of the early 1930s introduced by President Franklin D. Roosevelt in response to the bank failures in the wake of the Great Depression. The insurance is paid for by banks. According to Wikipedia, the US was the first country to implement a government run deposit insurance.

May I add, the country foremost associated with individual liberty, responsibility, and self reliance became the worst possible offender. The Statue of Liberty is still weeping.

Ever since FDIC was maintained and expanded. It is one of the many examples of federal power grab.

The Great Recession And Silent Bank Runs

I wrote a separate blog about this subject. I would argue without the generous FDIC, the financial crisis would have been less pronounced. Financial institutions tend to have more reserves absent such insurance. As a result of the Great Recession, the FDIC was given even more powers to intervene in the banking system.

Why Privatize?

Has government run deposit insurance not worked reasonably well in many counties of the world? Superficially, this is true.

However, government run deposit insurances are a form of Socialism. As Ludwig von Mises would say, the government run deposit insurance is prone to a spiral of increasing government intervention in private businesses. Historical evidence tends to confirm von Mises’s observation.

If there is a real need for deposit insurance, free markets would discover this anyway and seek solutions for the prospect of a possible bank failure. Why would free markets not offer such insurance, if there was any demand for it? In the absence of government run deposit insurance, bank customers would rather not put all their eggs in one basket, meaning they would more carefully spread their deposits across banks etc. and they would also more closely monitor their banks.

Today, with the easy availability of electronic funds and transfers, any bank customers can instantly transfer their deposits from any bank to any other bank worldwide, thus bank customers can take immediate action. Proponents of paternalism will surely argue that bank customers are too myopic or irrational to guard themselves.

Advantages Of Private Insurance

If banks pay for private deposit insurance it could be a competitive advantage. Private insurers would exert some pressure on banks to behave more responsibly. Insurance premiums would be a price signal indicating which banks are more risky and so on. It would be up to deposit holders to decide how much insurance they really need instead of one size fits all government deposit insurance.