THE LAST DITCH An Englishman returned after twenty years abroad blogs about liberty in Britain
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Guest Post: Economics

After the 2011 tsunami, Fukushima nuclear power plant exploded and was unable to produce electricity, necessitating rolling blackouts and widespread efforts to save electricity in the Tokyo region/ East of Japan. The disruption that this caused was completely inevitable given the circumstances. At the same time, in the West of Japan there was also a widespread campaign to reduce electricity consumption. Lights in supermarkets were turned off, air conditioners not used despite soaring temperatures, workers all crammed into one office, people generally encouraged to turn things off regardless of inconvenience - to help the people in Tokyo.

All this, despite the fact that there was absolutely no way to transfer electricity to the areas with a shortage. The Eastern and Western halves of Japan operate on completely different electricity systems and are unconnected. Consumption in the West is entirely unrelated to availability in the East, yet people still believed that their sacrifice would somehow help their countrymen.

You might find this behaviour strange, or perhaps noble, but to me this represents more than just another oriental peculiarity or example of Japanese communalism. This is the way that most people around the world think, most of the time. It's based on the principle that resources are universally exchangeable and unfortunately, it is a damaging mistake. The reason why we make this mistake, is money. We are so familiar with equating the things we consume and do with money, we forget that different types of work and different resources are often entirely unrelated.

For example - if I manage to refrain from eating a chocolate bar, the number of motor cars does not increase. There is some real physical limit to the number of chocolate bars which can reasonably be produced in the present. There is also an unrelated limit to the number of cars which can be produced. A chocolatier cannot design a motor car and a chocolate factory cannot make one.

We are told, often and loudly, that the rich must pay their fair share in order to contribute to the poor. I suggest that this is not possible. The rich absolutely cannot pay for the poor, because the resources that they use are entirely unrelated to those which the poor need. The rich spend most of their money on positional goods. If we lower spending on diamond rings, will more food become available? Will lowering spending on Ferraris increase the number of houses? No.

"But," you cry, "if we spend money on the poor, we must get it from somewhere!"

Yes - we make it. If the supply of money is the only factor which is limiting production, then presumably producing more money will increase production ( for free since money costs nothing to make). I assume that price rises are driven by supply and (nominal) demand, so if production increases, presumably price inflation will be limited. In this case nobody has paid anything to feed the poor, though some people have chosen to work.

If there is some real limit to production, then producing more money will lead to inflation. But even in this case, it won't be the rich who pay.

Price increases for everyday goods, will effect the rich only a little and in order for the price of the positional goods which they want, to increase, the rich would have to be getting more money (or who else would pay for them). In real terms, they have lost nothing. In reality, the price increases would affect ordinary people - so they would be the ones paying for the poor.

If printing money is inflationary, then taxing it must be deflationary. Why not give the money to the poor, but reduce the inflation impact on ordinary citizens by taxing the rich? Again, this won't work. Given that the rich spend so little of their income on everyday goods, the only way we can have an effect on the demand for these goods is if they stop paying so much money to their workers, ordinary people.

If we want to pay for the poor and there is a limit to real resources, it will be the ordinary people who pay - through consumption tax or food price inflation - in real terms, through less everyday goods.

There are, of course, other reasons why we might want to tax the rich - perhaps their wealth causes great unhappiness to the rest of us, or they earn their wealth through exploitation rather than contributing to the common good. Perhaps by taxing the rich we will encourage people to work harder in real jobs. Perhaps the rich will work harder to make up the money they have lost. Who knows. Taxing the rich could equally cause them to work less hard and make us all poorer. The case isn't clear which is why people generally try and justify taxing the rich on the grounds of them "paying their way", even when their true motivations are quite different.

As far as I'm concerned the effects of taxation on this group are so unclear, we probably shouldn't worry about it over-much. Ideally, we would have a society in which wealth wasn't produced by antisocial activities, but destroying the entire mechanism of money as motivator isn't likely to achieve that.

In the same way, by not consuming a chocolate bar, perhaps I might, in the long term, lead to an increase in investment in car factories. Only if I use my money to buy more cars.

We are also told that increasing government debt means the impoverishment of our children as they work to pay it off. This is the temporal version of the Japanese Electricity Fallacy. As Bertrand Russell once wrote, "a man cannot eat a loaf of bread that does not yet exist". By taking a piano lesson today, I am not reducing the number of piano lessons available to my children. Government spending, resulting in debt can only reduce the welfare of future generations to the extent which it reduces investment in the economy. But the reason for increased government expenditure and deficits at the moment is the desire of the private sector to save.

That is what government debt is - the savings of individuals and businesses. And that is why interest rates are low - businesses fear that demand is weak and therefore don't wish to invest - they are saving their money. This saving does not result in productive investment. The government can help, by either giving money to people in the private sector who want to spend but have no money, thereby boosting demand and encouraging investment or by investing in public goods themselves.

"Ah!" you exclaim, "eventually, interest rates will rise and then we will be bankrupt!"

If interest rates rise, it will mean that the price of bonds have fallen. What would prevent the government from buying these bonds back at less than they issued them for in the first place, exchanging interest bearing bonds for zero interest cash? They would turn a tidy little profit on it at the same time (though the idea that the government (representing the country as a whole) should be trying to make a profit(at the expense of the country as a whole) is utterly ridiculous).

It is absolutely true that if savings are sufficiently high and growth in productive capacity sufficiently low, that the people making savings have absolutely no hope of getting their money back. They will lose out to either inflation or tax (this is what will happen to the Japanese eventually). But, what do you suggest we do about this? Surely the only thing we can do is attempt to boost demand and investment through government spending. The "do nothing" charter will absolutely doom savers to losing their money, and mean the rest of us have fewer sunglasses at the same time.

Having said this, there is a definite limit to what government spending can achieve. All unemployed people are not the same and giving them money will not neccesarily increase real production. It will however increase demand which will encourage those capable of production to get on with it.

In my humble opinion, we shouldn't worry about debt, deficits or unemployment - an excessive concern for any is likely to be counter productive. We should instead be pragmatic and attempt to buld the best possible society while ignoring the twin evils of egalitarianism and market fundamentalism.

[Even more than his previous posts, this - Mark's final contribution here - only represents his own opinion and is not endorsed by The Last Ditch in any way, shape or form. Tom]


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Sorry for slow reply, went on holiday for a few days...


I think that the principles of self ownership and the ownership of the work we have done are ideas which have taken us a significant distance in the right direction. I don't, however, consider these ideas to be in and of themselves, universal principles of justice, or a practical basis for society.
Let us imagine that we had machinery and computers which could produce all of the food and consumer goods we needed and that the only work required by a human would be for someone to press the "on"button. 
Would it then be right to say that whoever pressed the button had complete say over the life or death of those who needed the goods produced? Should we all fight to decide who should be the one to press the button? 
It seems to me ridiculous that we should.
This might seem to be an extreme example, but it is one which increasingly represents the world in which we live. 
And if our beliefs don't hold up in extreme cases, perhaps we should try to avoid holding them to extremes. 
It doesn't matter if the idea in question is equality, nationalism or even the free-market. While all of these principles have some contribution to make towards a better society, focusing on them to the extent of ignoring what is good or right, what is practical - is mad. 
So what are my principles? I imagine that the principle of love would be the only positive form of extremism, but I suspect it is beyond humans to create a society which runs in such a way. As such, I adhere to the extremely liberal principles that we 
should question our beliefs and attempt to avoid dogma while trying to do what we consider to be right, always acknowledging that others are likely to have different opinions to us.
What I consider to be right is obviously informed by the culture I grew up in and isn't formulated into a consistent ethical system, as such it'd take a little too long to go into in detail... but basically, "fair play".
I consider the role of the government to be that of referee - the extent to which he is neccesary depends on the game we are playing and the attitudes of the players...

By the way, you say that I'm proposing a system where no-one would have any motivation to work. This isn't true. The vast majority of work done in the present day isn't done to avoid starvation, and a lot of the best work is done for its own sake. If people feel they have nothing to contribute through he world of work, let them do something else - a citizens income would boost markets by giving both sides of the deal more freedom to choose.

If you truly live a life without any force and without relying on the force of others acting on your behalf, then you are a saint. I must say that I find it hard to believe that if I came into your house and took your television, you would do nothing to stop me, not even call the police.
Whichever way, I don't think that the majority of people can live in such a way and so I don't think it is a practical guide for society.
Common feeling and understanding will get us so far, but not all the way there.
Even basic ideas of right and wrong are normally established through the use of some parental force, rather than spontaneously emerging.

Money and the real economy are not exactly the same thing - for one thing, when we save money under the bed, we aren't saving real resources, like as not, we are wasting them. Quantative Easing is an attempt to boost the economy by replacing money saved at interest with non-interst bearing money. Normally, because people wish to save this money anyway, it has no real effect except to boost the prices of financial assets and reduce interest rates. If no one wants to borrow (or lend) nothing happens.

Money is a token. 
A token of what? When I hold a piece of money, what does it mean, what do I expect? I expect to recieve something real for my money, otherwise it would have no meaning. I expect that I should be able to act as if some other member of society owes me something real in exchange for the coin. 
Is that different to your conception? 
You accept that the "relevent authorities" must have a hard time judging the appropriate amount of money which should be in the economy. Why then, is it hillarious to suggest that they might err on occasion on the side of there being too little money? 
In our society, economic activity does not take place without money - people do not barter unless the economic system has entirely broken down (and probably not even then) and people don't accept IOU's from people they don't know. If the production of money is in private hands (banks) they will only produce money when they feel they can get a return - only a body which isn't profit seeking (govmt) can produce money on the basis of economic capacity, rather than their own profit.

The overall theme of the above post is the ways in which people confuse money for real economic activity. 
In the first place, with tax, there is the notion that transfering money from group A to group B automatically makes Group B better off with no effect on Group C. They think that real resources can be changed and transferred like money, which they can't. 

You object on the grounds that while temporarily price rises would affect the poor, in the long term production would shift away from the things that the rich want and towards more everday goods. 
Fair point, but it still doesn't change the fact that the entire discussion of taxation is over-simplified, that these changes would take a long time to impliment or the fact that the real problem we face is a lack of demand rather than a shortage of production...

I'm interested as to your thoughts on my views on the government debt.

As for your comments on the rule of law.
You seem to be saying that efficiency should lead us to leave the pieces where they lay. From my perspective it is inefficient to give power to the arbitrarily rich, to decide the fate of the poor. They should both be given a say in the future they have. 
You have good business ideas. I think good ideas have an important part to play, well done. I don't see why people need the threat of destitution hanging over them to recognise your good ideas though.
I'm not a lawyer, so am unclear of the difference between "adjudicating" upon and "directing" property rights. 
I think that institutional culture and rules can have a large effect on the behaviour of individuals. You also need to have procedures in place to prevent misbehaviour. I'm sure as a businessman you understand this. Obviously it is still important to limit power-  and that is exactly what I would like to see - a world where I am not forced by fear of destitution to do pointless work.

That makes me a slaver? Perhaps the best that we can hope for is a society in which the slaves are richer and more powerful than the masters.


More than that, it's not relevant whether he's racist or not. We are trying to discuss his views on economics, so - as in 99% of cases where racism is alleged - it's a pointless distraction. Moggsy, please let that point go.


Mark, try looking at wealth not as money, but as all the real tangible things that enrich and and add value to your life, such as food, shelter, friendship, healthcare, car, property etc. Money is simply a store of value, and a means of exchange, creating more money (as in QE, or the gov printing it) will not create more genuine wealth, it simply dilutes the value of the money already in existence. Real wealth is only created by individuals carrying out productive activities that actually produce things of a tangible value to others.


Come on Mark. Please be civil. Disagree with Moggsy all you like but it's not on to suggest she must have been drunk to disagree with you.


Neither the total value of assets in an economy is fixed, nor the money that is used as tokens to exchange such assets. Both clearly vary all the time and it's a tricky task of the relevant authorities to match the supply of money to the economy's needs.

Economic activity creates value - which is represented by money. Money is not value, it's just a token of value. I don't know how many more ways I can express that, frankly.

I am not sure which of your other points you feel I have not addressed. I didn't originally plan to address *any* of them but rather to remain in an editorial capacity and let the debate unfold as it has on your previous posts.

I am honestly unsure what to make of your chocolate bars and Ferraris riff, for example. You seem to imagine car and chocolate production to be fixed when actually the factories, jobs and companies all come and go according to demand.

If consumers are unsatisfied with Ferrari's sterling efforts to reduce carbon emissions for example, then Ferrari - a young, small and potentially vulnerable business - will very soon be no more. But of course the investors, managers and workers who presently constitute the company will still be there. They will all just do something else. Perhaps even some of them will manufacture chocolate?

To say "a chocolatier cannot design a motor car and a chocolate factory cannot make one" is really misguided. People can and do change careers and businesses. They can (and rapidly do) switch investments. It's like saying "an agricultural labourer cannot build looms", for example, which would have meant the Industrial Revolution couldn't happen.

I really think you confuse the ebb and flow of economic activity with a fixed set of relationships. Then, like a lot of statists, you look at that social balance sheet - find it unfair - and start fantasising about how to redistribute things. By the time you form a movement and marshal the political force to do it, everything will be different anyway.

Trooper Thompson


"I believe in the rule of law, so I do believe in the government exercising force on my behalf"

When the government exercises force on your behalf, does it derive the right to use this this force from your own right to act on your own behalf? In other words, does the government's legitimacy, in your opinion, derive from the people?

"I don't believe in people doing anything that comes into their heads"

This would also apply to people in government positions and wearing uniforms, right? Ergo, the government - meaning the people who work for the government - are under the same laws as the rest of us.

What is the purpose of the law? As far as I'm concerned, to prohibit violence and aggression by one individual or group against others. If no such violence or aggression is involved, the law need not interfere.

As for starving people and what they are capable of doing, are you suggesting that our laws should be written on the basis of extreme necessity? I would say it far better to use the basis of our ordinary experience, and deal with such extreme situations as the exception, not the rule. Theft is theft, whether you are feeding a hungry child or a crack addiction. Certainly, for morality's sake we should distinguish between these two, but the law should be clear.

Trooper Thompson


I think you are being hyper-sensitive. There's no indication of racism in Mark's words.

Trooper Thompson

"I'm not opposed to property rights. It's almost impossible to imagine a society without property rights of some kind - simply saying that you believe in property rights, that you believe in the law, is not a moral or ethical position - you have to state clearly what kind of property rights you believe in, who has the right to what. "

Let me state it clearly, using the natural right position (which is not universally-accepted by libertarians): we own ourselves, our labour and the fruits of our labour. The law is to uphold and defend these property rights.

That's the foundation: self-ownership. What is your foundation?


I thought you must have been drunk when you wrote that last comment and that it'd be politer to ignore it, but if you insist - 

It was not my intention to cause offense.

There is a tendency in the west (and in Japan for that matter) to view the Far East as fundamentally different to the rest of the world. It was this tendency I was referring to rather than my own opinions on Japanese society/culture.

I don't personally consider the word "peculiarity" especially offensive.

If I did consider the Japanese to have an incredibly strange culture, there would be nothing wrong with expressing that view. They are big boys, I think they can take it. 

And yes, I believe in the rule of law, so I do believe in the government exercising force on my behalf and no I don't believe in people doing anything that comes into their heads (though I, and most people, would probably do a hell of a lot if our families were starving


The discussion here about the morality of mainaining the status quo/ redistribution as slavery is really interesting, and you've made some good points, but if possible I'd like to concentrate on your last paragraph for a moment, which strikes me as seriously ignorant.
You find the question "can a lack of money inibit economic activity?" hillarious, which I take to mean that you think it can't.
You then tell us that "if there are no assets to be represented by an increased supply of it..."etc. 
This is rather like responding to the question "can blue martians eat cheese?" with "if there is no cheese, blue martians can't eat it.", in short, not very helpful. I'm not really too sure what you are saying here.

Are you saying that the total amount of money is fixed and that economic activity occurs independently of it? That can only be true in a barter system.
Are you saying that economic activity itself creates money? That isn't true.

Maybe I'm a complete turnip-head, but I get the feeling that despite your other talents, your knowledge of money is even more shakey than mine. 
And I note, still no response to the points made in the original post.

I don't "suck it up" when arrogant old men and their spoilt daughters call me stupid. No one with any self respect does. 
Perhaps you've been spending too much time with the staff?


I am sorry you have taken offence. I tried to state your views neutrally in encouraging people to respond. I also expressed sincere gratitude. So do try to suck it up when you feel criticised.

I have worked for twenty years in places where property rights were or are still not respected (immediate post-communist Poland, Russia and China) and have seen the dire consequences of casting doubt on whether those in possession of economic assets can rely on continuing to own them.

Russia, for example, should be the richest country on Earth but is relatively poor because the single most important fact about property rights in Russia is that you can't rely on them. So you never invest for the long term. Anyone with business skills therefore tries to get money quickly and get it out to somewhere (e.g. Britain) where his property rights ARE respected. In consequence, a wonderful, talented, cultured people are deprived of prosperity because a corrupt class of politicians reserves the right to seize, directly or indirectly, any productive assets it takes a fancy to. It is my sincere opinion that it is monumentally damaging to introduce such doubts. Far more damaging than patiently allowing time and the markets to deprive fools of their wealth.

You will tell me Mark's Powerful State will be wise, good and not remotely corrupt. I don't believe you. There are no historical examples of such an entity. None.

My own grandfather built a business in the 1930s that was confiscated by the British state in 1946. It is now part of DHL and I guess I might argue that the German post office doesn't morally deserve to own at least that portion of that company acquired from the British state which had taken it by force from him. But to cast doubt on that, or worse campaign for further confiscations by the state, would undermine investment by the current owner and would be damaging to my fellow citizens about whom I care (but without believing my caring entitles me to boss them about).

Yes it's "unfair" that a not very clever, talented or industrious man is is possession of enormous assets because his ancestor was William the Bastard's nastiest general (you know who you are Your Grace). But confiscating those assets by force would do inestimably more damage than leaving them where they are to be used productively.

The socialist confiscation routinely done on death in Britain (IHT) is already damaging the economy. You don't even want to do the job you have, but would prefer to go fishing at others' expense. I have *created* many jobs in my life for others to do. There are families living and educating their children on the continuing proceeds from businesses I have built. I am proud of that. It gives me a lot of satisfaction. However, I am not doing it any more largely because I don't need the money and so it would just create more wealth in my hands to be confiscated from my children when I die. Replicate that tens of thousands of times and consider the consequences.

There is a clear and direct correlation between a nation's prosperity and its respect for property rights. Every argument you advance has been used in the poverty-stricken shitholes of the world to bring them to the state they are in now and you must forgive me if I therefore think you a fool for seeking to apply them here.

I am no Pangloss. Nor am I a fantasist who thinks that the world can exist without disagreements or violence. I practised commercial law for thirty years and any such impractical notions were long ago quelled by experience. Libertarians understand that force and fraud is a problem. For goodness sake that's why - even though we hate and fear the state (with good historical cause) - we believe there should be one. We need it to suppress force and fraud as far as is humanly possible. Oh and to provide an independent judiciary to adjudicate on disagreements about property rights. But *not* to own, direct or interfere with property rights itself. As soon as it has more than minimal assets needed to house and service its minimal functions, it *will* become corrupt.

You are the naieve fantasist here in postulating a disinterested state which, though composed of the same weak creatures whose failings you think make it impossible for them to take care of themselves, can do good without being taken over by corrupt politicians and exploited by big business rent seekers. Any force as great as a social democratic state *will* be infiltrated by evil-doers. You may (although I am personally not sure) be as well-meaning as you claim. But you will not be doing the job will you? You will be fishing and trusting the people who do show up to do it. And it's as predictable that they will be power-crazed or corrupt as it is that paedophiles will apply for jobs in a children's home.

When you say everyone has a right (regardless of effort) to what they need to live, you have to understand that rights don't come out of thin air. That "right" for someone to be idle comes at the cost of enslaving (and that's not too dramatic a word) others. Taxpayers in Britain are time share slaves, working for months for the state before they are allowed to earn for themselves and their families.

In a sense, you are a slaver, Mark. So are all who believe in redistribution of wealth. So you are far more than merely foolish. You are dangerous. Even your petulance when crossed is typical of the arrogant statist. It doesn't take too much imagination to picture you at the helm of your ideal state, behaving just as badly as all the others who ever took power saying they would do justice.

Finally, to your last hilarious sentence above. Money is a token used to represent real assets in exchanges. It saves you having to take your sheep to the pork butchers when you want bacon (and indeed from the hassle of finding a pork butcher who wants mutton). It has *no* inherent value. It's just paper, base metal or digits in a ledger. If there are no assets to be represented by an increased supply of it, there's no point in increasing its supply. All that will do is adjust (imperfectly but with rough accuracy over time) the value of the existing tokens - thus confiscating value from those who have accumulated it and transferring it to those the politicians currently in charge of the state desire to bribe. Until you get the idea into your mind that declaring Monopoly money legal tender would not make us all richer, you cannot really be taken seriously.


Mark, From your comments you seem to have no beef with the application of violence, tho I guess you would prefer the state to excercise that violence on your behalf.

You seem to say quite clearly that it is ok to appropriate anything that belongs to anyone if you feel you need it, when you state you believe "everyone has a right to things which will allow them to live"

You carefully avoid any comment on your apparent racism.

I almost wonder if Tom made you up as a "perfect example".


"By the way, when "you people" say that you don't believe in compulsion, it means less than nothing, because no-one can imagine a society in which there is no disagreement, no violence or threat of violence. What you really mean is you believe in a society in which everyone agrees with you, or perhaps that anyone who disagrees with you is so appalling that acts of violence against them, using the law against them, does not count as force."

Mark, If someone disagrees with me, that is there right - I would never think it proper or moral that I should force them to agree with me or compel them to behave in a certain manner of which I approved and they did not.

If people disagree - as far as I am concerned, they should be free to disagree, they can still rub along together or alternatively go their separate ways if that suits, what is immoral is if you disagree with me and I attempt to use force or the threat of force to coerce you into going along with my ideas or beliefs over yours. Maybe the reason you cannot imagine a world without violence or threats of violence is because you yourself think its appropriate to operate in this manner, maybe you would deploy or back the people (the state) that deploy violence in the name of the things you believe in.

We all disagree with each other on many issues, that is human nature and why we each are all unique individuals, it is only when we realise it is immoral to attempt to force rather than convince others to follow what we believe in that we will truly become a civilised society.

Trooper Thompson

I've stupidly lost a reasonably long response to this, due to leaning on the mouse, so I shall make a few remarks, and return at a later date to flesh them out.

Mark, I think you are motivated by a belief that we should help our fellow creatures, less fortunate than ourselves, and something rings false for you in the libertarian way of looking at such problems.

It's the nature of disputes that things get mashed up together and become somewhat incoherent, so I would start by distinguishing between the following: the theoretical concept of liberty,as upheld by libertarians; a rational theory of economics, as understood by the same; the present state of the economy and society, where we have arrived and how we got here.

When we are discussing the last of these, it is natural that a libertarian uses the first two as a measuring stick and as a guide to action, and differences at these, more fundamental levels produce widely divergent views, even when we are all hemmed in by pragmatism.

For instance, you say: "I state clearly that I believe that everyone has a right to things which will allow them to live and that the law should therefore be established to ensure this." This seems to you most reasonable, but to me it opens up a Pandora's box.

The simple Lockean approach is that everyone has a property in themselves, their labour and the fruits of their labour. From this, a peaceful society can proceed. What you are suggesting is that everyone has a right to the fruits of labour, but no one has a responsibility to do the labour or, indeed an incentive to do so.

I shall return.


I completely agree Tom - you can imply, through precious Miss Paine, that I'm stupid all you like, but if we look at the responses here, including yours, they've singularly failed to adress any of the points I've made. 
I have to say I worry about the Paine familiy's reading comprehension if they think someone arguing against egalitarianism is "left wing" - though from the perspective of the mad, mad market led right, perhaps everyone is.
I'm not opposed to property rights. It's almost impossible to imagine a society without property rights of some kind - simply saying that you believe in property rights, that you believe in the law, is not a moral or ethical position - you have to state clearly what kind of property rights you believe in, who has the right to what. 
I state clearly that I believe that everyone has a right to things which will allow them to live and that the law should therefore be established to ensure this. Beyond that, I don't think it is a moral issue so I'm happy to leave it to the market.
What do you believe? That whatever happens to be at the moment must be right and that the law should be used to protect the status-quo via-a-vis property ownership, completely ignoring how that property was first acquired, bad luck and anything else that might interfere with your Panglosian narrative.
By the way, when "you people" say that you don't believe in compulsion, it means less than nothing, because no-one can imagine a society in which there is no disagreement, no violence or threat of violence. What you really mean is you believe in a society in which everyone agrees with you, or perhaps that anyone who disagrees with you is so appalling that acts of violence against them, using the law against them, does not count as force.

Why isn't it possible that a lack of money could inhibit economic activity? 


Miss Paine the Younger accused me today of selecting Mark to write these posts because he would present a soft target. "Why didn't you find someone more able to put the Left's point of view?" she asked. I can see it might look that way but my intentions were sincere and honourable. Mark's guest posts have received a mixed reception but I thank him for his efforts and for stimulating - if not the economy- at least far more comments than I ever have.

Nothing is going to change for the better unless we can persuade supporters of the failed status quo to move towards a new economic and political consensus. It seems that all sides simply read their own books, magazines newspapers and blogs to reinforce their views. Most of our civil discourse is in fact very uncivil. Much of what passes for debate is childish name-calling - sometimes even in academia.

Mark has tried. If nothing else he has presented some fine examples of the thinking of many if not most of our fellow citizens. He sincerely has no respect for property rights, believing that where the chips have fallen is a product of a defective system so there's really no reason just to leave them where they are. He sincerely (if scarily) believes in the essential benevolence of the state and that it can be relied upon to distribute resources in a disinterested manner. He sees no connection (and in this he seems to resemble all but a couple of the Chancellors of the Exchequer in my lifetime) between money as tokens of value for the purposes of exchange and the actual value of national wealth.

Before we laugh and sneer, let's remember that he is by no means alone in thinking government can boost the economy by printing money since " costs nothing to make...". He is certainly not the only person followers of the Austrian School have to win over if we are to steer away from the cliff faux Keynesianism (as if the real stuff were not toxic enough) is leading us toward. Let's try and see him as a volunteer proxy for all those misguided millions.

He has performed a public service here and while I sense a certain weary reluctance to fisk his final post, I would be delighted if more readers could gird up their loins and do so. Particularly the ones who have been privately berating me for giving him a vehicle in the first place. Come on. Get your hands dirty.

Thanks, Moggsy, for taking the trouble to chip in your views. Thanks, Monstro, for pointing out the troubling moral vacuum at the heart of Mark's (and most of the British public's) thinking. Thanks, Suboptimal, for offering him a place to start his studies of the Austrian School. But come on everyone else. There's a rich, groaning table of error in this post to correct - not just for Mark's benefit but for others who may pass by. This is not a debate I can see anyone else volunteering to host right now so please light your candles rather than curse the darkness.

Suboptimal Planet

Like Monstro, I don't have the time or energy to pick this article apart, so let's try reflecting on a simple maxim:

There is no such thing as a free lunch.

It sounds like you know just enough about economics to be dangerous.

I'd suggest exploring the writing of the Austrian School.

The Hayek-Keynes rap videos provide a nice introduction.

[To be found here - Tom]


“there was absolutely no way to transfer electricity” Says you, where is the evidence?

“more than just another oriental peculiarity”? Is it me or does this sound inherently racist? Tom did you vet this?

You say” we forget that different types of work and different resources are often entirely unrelated.” And I figure you do have some truth there.

“If printing money is inflationary, then taxing it must be deflationary” this does not follow logically. Increased taxation obviously drives up inflation. More tax on fuel drives up costs all over. Increasing prices and inflationary pressure.

I know you maybe seem to put this up as a sort of straw man, but really, “reduce …impact on ordinary citizens by taxing the rich?”

You like lots of people just seem to just miss that the rich are taxed duh!

Are you talking about not taxing the rest of us? If you taxed the “rich” (a relative term) at the same rate as everyone else you would still take much more cash from them than from those with less money.

Are the “Rich some weird non citizen group it is ok to persecute? The left seem to think so. Who judges ? “Hard working families” Aspirational” actually make it and they become the “undeserving rich” in the politics of greed and legalised theft.

You are big on the use of state force on citizens in the "wrong" groups?

“Government spending, resulting in debt can only reduce the welfare of future generations to the extent which it reduces investment in the economy.” You really really don’t understand economics do you.

I mean..” That is what government debt is - the savings of individuals and businesses” Does that even scan? It could mean several things, mostly nonsensical

It reduces the wealth (not welfare) of future generations cos thy have to carry an increased TAX burden to service the debt (pay the INTEREST and the CAPITAL)

After that the post just looses it.


Hi Mark,

You have written so much there i wouldn't know were to start in picking that lot apart, and I agree with little of it.

What I would say to you is that my measure is always against what I would consider to be moral, and my moral judgement is to test whether something is voluntary as opposed to coerced or forced. True morality can only exist when you never under any circumstances ever initiate or condone the use of force and that extends from the man on the street right up to and especially including the state and those in power.

Until you can ground your thinking with a sound philosophical foundation, your quest to do the right thing will lead you up immoral path ways and the solutions (although I am sure of the best intent) will only fail to hold cohesively together and produce the outcomes you wish.

I would ask you to ponder heavily on first principles and in particular the immorality of the initiation of the use of force.

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