After reading my many criticisms of the people who do business as “The Government”, a friend of mine asked me what I think Barack Obama should do to resolve this financial “crisis”. I realize the importance of offering not only criticism but also solutions. It’s only fair. To criticize is to go on the offensive. If one wishes to have a good-faith debate with friends, one should also propose, as this gives your opponent the chance to criticize as well, making it a fair fight. It also makes for a more interesting and authentic discussion.
The “Crisis” is not the Crisis
According to politicians, the “crisis” is that the economy stopped growing and loans are not available. People are losing jobs and businesses are closing. But what painfully few people realize is that this is a healthy reaction to the government-facilitated excessive spending and production of the last decade. If the politicians insist on creating bubbles, they have to accept the consequences of them bursting as natural, necessary and curative.
Government Caused the “Crisis”
The real crisis is both that which caused the “crisis” and the politicians’ reaction to the “crisis”. What led to the “crisis” is government, through its alliance with the banking cartel (Federal Reserve) maintaining an “easy money” policy with excessively low interest rates and dictating to banks to whom they must lend while simultaneously inserting Fanie Mae, Freddie Mac and the Federal Housing Administration (FHA) into the market to buy up all these loans and repackage them as securities.
Let’s Solve the “Crisis” with, uh, Another one!
The reaction – crisis number two – is an enormous looting of the government to the tune of $9.7 trillion (that’s almost two-thirds of the value of everything produced in the US last year!). This includes the anticipated “stimulus” proposed by Mr Obama and the bank bailout (TARP) effected by George Bush. No, Mr Obama did not create the real crisis, but he’s helping it along.
“We’ve seen money go out the back door of this government unlike any time in the history of our country,” Senator Byron Dorgan, a North Dakota Democrat, said on the Senate floor Feb. 3. “Nobody knows what went out of the Federal Reserve Board, to whom and for what purpose. How much from the FDIC? How much from TARP? When? Why?” #
The Minarchist’s Answer
Given that, I’ll offer two answers to my friend’s question about what Mr Obama needs to do, one from the point of view of someone who wants to keep government and one from the point of view of someone who thinks governments are intrinsically and inescapably evil and worthless institutions.
- Terminate the Federal Reserve system. Revoke the government’s charter of this central bank / banking cartel. The “Federal” “Reserve” (it’s actually neither) manipulates interest rates and increases the money supply when it deems appropriate, wreaking havoc with the monetary system. Its “easy money” policies are largely to blame for the housing bubble.
- Repeal legal tender laws. Legal tender laws force people to use US dollars for contracts. But people need to be able to use whatever form of payment suits both parties. Since the US dollar is a fiat currency (paper money has no intrinsic value and is only worth something because the government says it is), legal tender laws are needed to keep it in circulation.
- Bring back the gold standard. Gold has historically been a stable store of value. Making US dollars convertible into gold again would restore trust in the currency and head off inflation a little. It would put each person back into control of their own money, and deter the central bank (“Federal” “Reserve”) from stealing via increases in the money supply. This would also make it more difficult to fund wars.
- End the collaboration of big business and big government by establishing the separation of economy and state. This means the government can’t tell bankers what kind of loans they have to make and it won’t bail them out if they go bankrupt. This means the banks won’t have government support for lending out ten times more money than they have in deposits. No more bailouts, stimulus packages, pork, interference in health care or any other industries.
- Repeal all taxes. If Mr Obama wants people to spend more, let them hold on to the roughly fifty per cent of their own income that currently is eaten up by taxes. Now that has the potential for a huge economic turnaround that is also just and ethical.
The Anarchist’s Answer
Here’s my answer for those who realize that governments always have been and always will be significant threats to liberty, and therefore should be strictly avoided.
- Ignore electoral politics. Don’t vote. Don’t donate to candidates. Don’t support any candidate. Criticize them all as conceited power-grabbers.
- Never ask the state to initiate force on your behalf. Don’t ask the state for anything. Use the state’s services as little as possible.
- Don’t pay taxes. The people doing business as “The Government” demand your hard-earned funds so that they can turn around and use them to initiate force against you and others. Don’t fund your own loss of liberty.
- Patronize free market institutions, especially ones that have the potential to replace government “services”.
- Practice counter-economics.
Not MY Government Program!
You may say “But X government program is critical and can NOT be cut!”. Everyone has their own favorite government programs, and when you add those up for 300 million people, it gets unwieldy and impractical. If you can get your food, clothing and shelter – arguably the most critical services for humans – on the free market, you can certainly get all the rest, if indeed it is of value to people and the price is right.
Put down the Gun
Government requires initiating force to get things done. None of us have the right to do that, and if that’s true, no human organization can have it either. Put down the gun, government fans, and we can talk. :)