Posted tagged ‘Central Planners Plans’

Central Planners Hate Economics

August 26, 2015

F A Hayek

F.A. HAYEK The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.

 

Politicians get voted into office because they promise to use the power of government to ‘do something’ to fix fake ‘crises’. They try to blame the unfettered free market for every inequality or unmet need found in society. Politicians blame economics because it is an easy target since most people don’t understand basic principles of economics.

Economic reality puts a limit on the unlimited designs of planners. The first law of economics, scarcity, especially the scarcity of knowledge, sees to it that everything has limits. Economic laws don’t limit the planners plans. Economic laws reveal the reasons the plans won’t work but they don’t create the underlying economic reality.

Ludwig von Mises

LUDWIG VON MISES  – “Economic history is a long record of Government policies that failed because they were designed with a bold disregard for the laws of economics.”

Planners have charged their central banks to do away with scarcity by using electronically printed counterfeit money. It sounds plausible on the surface if you look at ‘that which is seen’. But we all know from reading Bastiat that ‘that which is not seen’ is more important. The unintended consequences of Central Bankers policies, of money printing and zero percent interest rates, are playing out right now for all to see. Wasted resources and capital consumption are two of these results.

F. A. Hayek – “It has already been suggested that it is not necessary for the working of this system (free market capitalism) that anybody should understand it. But people are not likely to let it work if they do not understand it.

Central planners condemn free market capitalism because it doesn’t produce perfect results, (which means it doesn’t produce their desired result). Free market capitalism is the best system for allowing individuals the freedom to pursue their desires. This individual freedom has lifted the masses of people to a higher standard of living. Is it perfect? Nothing that man does is perfect. It is the responsibility of each voter to understand basic economic principles in order to protect the free market from the planners who want to destroy it. Start now because your individual freedom to pursue your interests in a free market is under siege.

 

LUDWIG VON MISES  – “Many think that governments are free to achieve all they aim at without being restrained by an inexorable regularity in the sequence of economic phenomena….they maintain that the state is God.”

These quotes by Hayek and Mises came to mind as I was reading an article titled, Economics Is Dead, And It Is Being Killed Again, by Per Bylund, at mises.org. here are some excerpts from the article.

“You have to applaud the anti-economics left for this rhetorical masterpiece. They have struggled for decades to sink the ship of economics, the generally acclaimed science that has firmly stood in the way of their anti-market and egalitarian policies, hindered the growth of big government, and raised obstacles to enact everything else that is beautiful to the anti-economics left. The financial crisis is exactly the excuse the Left has been waiting for. It is a slam dunk: government grows, Keynesianism is revived, and economics is made the culprit for all our troubles.”

“If this weren’t so serious, it would be amusing that the failure of Keynesian macro-economics (whether it is formally Keynes’s theory or post-Keynesian, new Keynesian, neo-Keynesian, monetarist, etc.) is taken as an excuse to do away with sound micro-economic theory to be replaced with Keynesian and other anti-market ideas. But it is not amusing. If most of the discussions heard are to be believed, the failures of central planning is a reason for central planning, just like socialism is a reason for socialism. The success of the market, on the other hand, is not a reason for the market.”

“…. the Left hates all that is economics. Because it points out that creating a better world through central planning, money-printing, and political manipulation is indeed impossible. The market is neither perfect nor efficient, but it is better than any available alternative. In fact, the unhampered market is the only positive-sum means available for human society. The market is indeed the only way of progress; all else is a step backward.

Related ArticleCapital Consumption aka. Eating Our Seed Corn, at austrianaddict.com.

Related ArticleWe’re All Born In The Middle Of The Story, at austrianaddict.com.

Related ArticlePolitician’s “Affordable” Ideas Must Obey Economic Forces, at austrianaddict.com.

 

Must Reads For The Week 8/9/14

August 9, 2014
The pen is mightier than the sword...

 The pen is mightier than the sword… (Photo credit: mbshane)

Federal Bake Sale Ban Set To Hit Schools This Fall, by Barry Donegan, at benswann.com. Someone must have slipped some fine print into The Healthy Hungry Free Kids Act (read here) of 2010 that added bake sales to the list of “foods sold on school grounds” that must meet “strict nutritional requirements”. This act was Michelle Obama’s baby, but in the “do as I say not as I do” world  that tyrants live in, she sang a different tune at a White House event this week (read here). She said she told her children, “….to use Instagram to take a picture of something really important rather than their food…I mean, No one really cares what you had for lunch“.  So let me see if I have this correct: No one cares about what you buy at a bake sale, except food Nazis.

FBI To Hire Contractor To Analyze Media Coverage Of The Agency, by Zach  McAuliffe, at benswann.com. In true tyrannical fashion, the FBI is warning reporters to be very careful about writing negative stories about the agency. Just like the IRS, the FBI can make the cost of writing a negative story very high. It”s a subtle threat, but a threat none the less.

Toledo Residence Should Be Complaining About Greedy Water-Hording Panic Buyers During The Cities Water Crisis, by Mark J. Perry, at aei-ideas.org. This is a great article that turns the tables on the conventional wisdom that always complains about “price gouging” during a temporary shortage caused by a crisis. Shouldn’t the greedy person that buys more than they need be the bad guy? If we would just shut up and let prices ration the goods that are in short supply, we wouldn’t demonstrate our ignorance about economic laws related to supply and demand.

Central Planners Fail To Herd Money Market Funds Into Over Priced Stocks, at zerohedge.com. Since the Fed has cut it’s QE money printing from $85 billion a month to $25 billion a month, the central planners have to figure out a way to make up the difference in order to keep the stock market bubble pumped up. They saw $2.5 Trillion sitting in Money Market funds and decided to to after it. The SEC changed the rules pertaining to these funds, creating an incentive to purchase stocks instead of keeping them parked in Money Market funds. They essentially raised the cost of parking. But like all central planners plans, people acted differently than planned. They purchased Treasury Bills instead of purchasing stocks. Central planners will never learn.

Gun Grabbing City Councilman vs. Concealed Carry Citizen, youtube. I wrote a post this week titled Anti vs. Pro-Gun Visions Of The World. The difference in these visions are on full display in this video of a city council meeting in Oak Harbor Washington.

GE Looking To Sell It’s Appliance Division, fool.com. The appliance division has had sluggish sales since the recession. Since GE is a crony capitalist entity, it wants to sell this division instead of compete in the market. It’s easier to have as many of their divisions as possible be subsidized by Government instead of having them compete in the market without Government subsidies . GE capital, aviation, healthcare, energy (wind turbins), feed off of our tax dollars.

Will Tea Partiers Sink Mitch McConnells Kentucky Senate Reelection Bid, at economicpolicyjournal.com. Mitch McConnells antics in his primary and his support of Thad Cochran in the Mississippi Senate Primary, have alienated conservatives, tea partiers, and libertarians. For many of these people this is the marginal straw that has broken the camels back when it comes to voting for him in the general election. He has upset the wrong people.

Is Thinking Obsolete, by Thomas Sowell, at jewishworldreview.com. I don’t have to say much about this article, just read and enjoy. Here is the money quote, In an age when scientists are creating artificial intelligence, too many to our educational institutions seem to be creating artificial stupidity.”

The Ethanol Industry: An Engine Of Economic Destruction, by Joseph Salerno, at bastiat.mises.blog.org. The ethanol industry is a misallocation of scarce resources into an activity that wouldn’t exist if it wasn’t mandated by Government regulation and subsidized by tax dollars. This is a combination of environmental regulations going too far, and agribusiness seeing a pile of Government money that is there for the taking. What could have been produced with all of this wasted land, labor, resources, and capital?