AUSTRIAN ECONOMICS ADDICT

Tom Coburn Has A Plan To Fight Washington And Save America, by Mark Hemingway, at thefederalist.com. What can be done to shrink the power of the Federal government over our lives if our elected representatives won’t do it? Excerpt from the article: “Coburn’s latest book, Smashing The DC Monopoly: Using Article V to Restore Freedom and Stop Runaway Government, …..spells out exactly what’s wrong with Washington……..Coburn’s….. book really serves two purposes. The first is to convince ordinary Americans that the problems in Washington are so dire they require dramatic action that elected politicians are unwilling to take. The second is to explain how ordinary voters and state politicians have the power to exploit an obscure constitutional process, known as an Article V convention, to bypass Washington and amend the Constitution to institute badly needed reforms, such as a balanced budget amendment and term limits……Much of the book, however, is dedicated to explaining what Coburn believes is America’s last best hope: an Article V convention….. the founders always intended this provision to be a significant check on the growth and abuses of the federal government, and it’s actually surprising that this method for passing amendments has never been exercised. Hamilton argued in the Federalist papers that this mechanism was put in place so Americans could “safely rely on the disposition of the state legislatures to erect barriers against the encroachments of the national authority.”

Congress Owes Taxpayers Answers About Its Harassment ‘Shush’ Fund, at thehill.com. Here is a perfect example of the ruling aristocracy not living under the same set of rules it places on us. Congress has set up a fund using taxpayer dollars to settle sexual harassment accusations against their members. And the perps names are sealed. This fund was created (slipped in) after a Republican Congress passed the 1995 Congressional Accountability Act. Do you think this constrains sexual harassment by members of congress? Or does it incentivize sexual harassment?

“Economic Development” Is A Corporate Welfare Scheme, by Nathan Keeble, at mises.org. Many think Government subsidies and tax breaks to certain businesses will spur economic development. But they are incorrect. Excerpt from the article: “Corporate welfare must come to an end if we want an economy which best fulfills its purpose, improving the lives of the most amount of people. The truth is that good businesses simply do not need the state’s handouts. Only bad ones do. If legislators truly wish to see their community grow and develop, they would be wise to pursue other reforms. The best path for a legislature to take is to get themselves out of the private sector’s way. Economic growth is slowed, halted, or even reversed when the state taxes, regulates, or otherwise violates private property rights. Removing licensing laws, lowering taxes, and repealing burdensome regulations would all be great choices to accelerate economic development and promote the welfare of local communities. Crucially, these reforms should be as generally applicable as possible to avoid the same harmful and distorting effects of the current corporate welfare programs.”

We Are Living In The Age Of Capital Consumption, Ronald Peter Stoferle, at mises.org. Excerpt from the article: “Capital formation is always an attempt to generate larger returns in the long-term by adopting more roundabout methods of production. Such higher returns….. result in greater productivity. It is therefore fair to assume that a more capital-intensive production structure will generate more output than a less capital-intensive one. The more prosperous an economic region, the more capital-intensive its production structure is. The fact that the generations currently living in our society are able to enjoy such a high standard of living is the result of decades or even centuries of both cultural and economic capital accumulation by our forebears……Once a stock of capital has been accumulated, it is not destined to be eternal. Capital is thoroughly transitory, it wears out, it is used up in the production process, or becomes entirely obsolete. Existing capital requires regularly recurring reinvestment, which can usually be funded directly out of the return capital generates. If reinvestment is neglected because the entire output or more is consumed, the result is capital consumption……..Once zero or even negative interest rate territory is reached, the return on saved capital is obviously no longer large enough to enable one to live from it, let alone finance a reasonable standard of living. Consequently, saved capital has to be consumed in order to secure one’s survival. Capital consumption is glaringly obvious in this case……At the same time, the all-encompassing redistributive welfare state, which either directly through taxes or indirectly through the monetary system continually shifts and reallocates large amounts of capital, manages to paper over the effects of capital consumption to some extent. It remains to be seen how much longer this can continue. Once the stock of capital is depleted, the awakening will be rude”

Read my simpler explanation about capital consumption in this article, Capital consumption, aka, Eating Our Seed Corn.

Looking For Inflation In All The Wrong Places, at zerohedge.com. Printing money is the definition of inflation. Central banks hide inflation by pointing to the movement in the price of a “basket of goods” which they track over time. But the  printed money has not significantly raised the price of the ‘basket of goods’ over the last decade. So where did the printed money end up. First of all it has allowed the Federal government to grow because it has funded the government’s debt. And It has found its way into stocks, bonds, real estate, fine arts, collectibles and cryptocurrencies. The spike in the prices of these things shows us where the money is flowing. These central bank produced bubbles will eventually correct when the money printing stops. Government intervention into the free market, especially Federal Reserves money printing, only helps individuals directly involved with government or individuals in orbit around government. The rest of us are funding these individuals.

The Free Market Levels The Playing Field, by Jacob Hornberger, at mises.org. Excerpt from thee article: “Consumers in a free market, not the government, do the equalizing and leveling, and, unlike the government, they do it peacefully and voluntarily. It is consumers who decide who is going to prosper and who isn’t. They not the government, is sovereign in a free market. How do consumers redistribute and equalize wealth? Through their decisions on what to buy and not to buy. By making those decisions, they decide who is going to be rich, poor, or middle class. In a free market there is only one way that a well-established, wealthy company can retain its position in the market. It must continue to satisfy the consumer by providing him with goods and services that he is willing to pay for. A company cannot force its customers to patronize it or forcibly take money from people to subsidize its operations. It must serve people by providing them with goods and services that they are voluntarily willing to pay for. Leftists are wrong. We don’t need government to destroy freedom and private property by coercively confiscating and redistributing wealth. The free market does a fine job redistributing wealth all by itself, and entirely voluntarily.”

This entry was posted on November 19, 2017 at 10:13 pm and is filed under Must Reads For The Week. You can subscribe via RSS 2.0 feed to this post's comments.

Tags: Capital Consumption, Congress Sexual Harassment Shush Fund, Corporate Welfare Scheme, Eating our Seed Corn, Free Market Levels The Playing Field, Government Economic Developement, Inflation in Financial Markets, Smashing The DC Monopoly, Tom Coburns Book