So they somehow managed to pull it off. Despite years of warning from Austrian Economists, despite the hard work of libertarians across the web and academia, despite us actually having a candidate in one of the main presidential-primary debates (RON PAUL!) talking about these issues in a consistent fashion to the American people, despite the plethora of 90 years of evidence pointing elsewhere *cough * FED * cough*, despite Peter “Cassandra” Schiff ranting on CNBC for over two years about the coming debacle and correctly blaming the federal government and its agencies for this even as the bullish commentators there literally LAUGHED at him, despite ALL of this… they managed to get mainstream American opinion to blame the free market for the economic crisis.
I take my hat off to them. I mean, really, it takes cojones the size of the budget deficit to even think of trying to pull something of THIS magnitude, let alone actually succeeding. What a virtuoso performance. Granted, they did have most of the mainstream media on their side, not to mention the vast majority of both political parties, lending new credence to the notion that the Republicans are the stupid party and the Democrats the evil party and that every now and then they decide to do something both stupid AND evil in the spirit of bipartisanship (BAILOUT!).
But the gall of this performance is actually quite frightening. I seem to remember some fairly popular German leader of the 20th century mentioning something about big lies being swallowed more easily than little ones by the people, but you really never see it coming. The way ALL respectable opinion circled the wagons when under assault by evil apaches firing off arrows of RIPOFF and SHAME ON YOU to protect the “bailout” plan all the while claiming it was for our own good. The way so-called “free marketers” like the Maestro joined hands with rabid frothing at the mouth socialists (a.k.a. Democrats) in assigning blame to a lack of government oversight and regulation. The way Wall Streeters who SHOULD HAVE KNOWN BETTER instantly began begging for the Federal Government to do something, anything, just for the love of John Maynard Keynes throw us a lifeline to save us from our own stupidity and mistakes. The way the pseudo-Right-Wing party (a.k.a. Republican) instantly gave up on its supposed free market credentials all the while claiming to be passing trillions of dollars of new spending and government intervention TO SAVE THE FREE MARKET. God, they even gave Paul “I’m a hack” Krugman the Nobel Prize as a final “F- You!” to us (thus challenging my previous ranking of “great moments in Nobel History” with Antonio “just cut out their brain” Moniz and Al “let’s end Western Civilization because I don’t want to take off my sweater” Gore at the top). The sheer gall of it… it’s a beautiful sight to behold, it really is. Were this performance on at the
So, once more for the cheap seats in the back, let us yet again go through the motions, as useless as they maybe and as futile as the effort seems:
1- The (unconstitutional) FED expands the monetary supply and manipulates interest-rates in a failed bid to defy economic laws, thus causing malinvestment in an artificial boom... something Mises and Hayek wrote about over SEVENTY years ago and Hayek actually won a Nobel Prize for (after the more intransigent Mises had conveniently died the previous year of course… those sneaky Swedish Central Bankers!).
2- The Federal Government through the Community Reinvestment Act as well as a whole host of regulations and outright threats of civil-rights lawsuits pressures/forces financial institutions to lend to minorities/lower-income classes with little regard to credit, thus allocating capital not on the basis of economic efficiency but rather political expediency, all to the applause of Jesse Jackson, The New York Times and “community activists”.
3- The Federal Government (noticing a pattern here?) intervenes in MASSIVE fashion in the mortgage market to the tune of, get this, TRILLIONS of dollars through Fannie Mae, Freddie Mac and the like, institutions so well-run they make Enron look like a model of corporate responsibility; this once again distorts the market to an inordinate degree with the added benefit of exposing taxpayers to debts Banana Republics would blush at.
4- The Federal Government (getting old isn’t it?) backed system of fractional-reserve banking *cough* FRAUD *cough* spirals out of control, with the taxpayer having to foot the bill as usual in the name of “market stability” and “saving capitalism from itself” (the latter one literally made me throw up a little in my mouth as I typed it).
5- On a more general level, the fiscal and current-account deficits of the United States, the high levels of taxation, government expenditures/regulations/interventions/tariffs, entitlement programs in the hole to the tune of SEVENTY TRILLION dollars (now THAT’S a Great Society!), and by and large ripping contracts to pieces on an ex-post facto basis and running roughshod over property rights: yeah, that’s a real FREE market…
In my rush and fury it is quite likely I missed a couple (hundred) other points of interest regarding our supposed “free market” and its blame for the present crisis. So the next time you’re watching the Daily Show and Stewart makes another snide remark about how this crisis has demonstrated the inherent flaws of capitalism, or if you’re flipping through channels and accidentally end up on MSNBC (poor thing) with Keith “my self-importance might collapse into a black hole of idiocy” Olbermann talking about how Obama should use his “mandate” to substantially increase the powers of the federal government, just do what I do and throw your controller as hard as you can at the screen. Trust me, it will give you tremendous satisfaction as well as being a heck of a cardio work-out. Don’t worry, you can rest assured in the notion that this has not been the first time they’ve pulled off such a frame job (see Great Depression and our previous “Messiah” and “5 out of 5 Presidential historians consider ‘great’ president”: FDR) and it certainly won’t be the last.
At the end of the day though, talking about all these problems in a vacuum is a bit silly, somewhat akin to getting run over and blaming the car as opposed to the inebriated coked-up 15-year old inside. The REAL question is WHY? Why did all of these problems occur? How is it that “our” government allowed it to happen? To claim that it was all “Bush’s” fault and “had so-and-so been in power this never would have happened” is to miss the forest for the trees.
I’m going to ruin the who-dunnit mystery here and say: it was not Professor plum, in the library, with the wrench. Rather, it was Democracy, in DC, with the legitimacy and power granted to it by the people. The problem, so to speak, lies in our democratic system of government: Democracy as a system for choosing our political leaders is incompatible in the long-run with a free-market, free-institutions and a free-people. Democracy inevitably leads to socialism. Democracy is inherently totalitarian in its nature and a democratic government WILL eventually move in on families, religious organizations, the market, clubs, private associations, marriage, your sex life, your children’s education, your jobs, what you eat, what you do or don’t smoke/snort/inject/swallow, what you can say and how, how people we’ve never met across the globe should act, etc. And anyone who says the contrary and talks about the possibility of reconciling “limited” government and democracy, or how we just need to “educate” people so they vote properly, or how people have a “right” to vote, or how democracy is responsible for our freedoms is either lying, borderline retarded or higher than the Mad Hatter traveling through the K-hole after binging on Special K while listening to old Pink Floyd records.
Cato the Elder, a statesman of the
And if you REALLY want to be cool, after thoroughly ruining the mood of the party and several friendships and doing a slow-motion walk away, casually say over your shoulder: Moreover, I advise that Democracy must be destroyed.