Reaping the whirlwind

The video is on the simplistic side but is accurate enough. The point is that spending of itself doesn’t make your economy grow and more especially, able to repay a loan. Only value adding investment does that, investments where every dollar spent leads to output whose value is greater than a dollar. Virtually no government ever does that, and when occasionally some government does, that government is not run by Daniel Andrews, nor, unfortunately, by Scott Morrison.

Let me continue along the same line of thought with this from Mises.org: Central Banks Are Destroying What Was Left of Free Markets. It is a more sophisticated version of what I wrote about earlier: “The best way to destroy the capitalist system is to debauch the currency”. The author here is Alasdair Macleod, “the Head of Research at Goldmoney”.

Those receiving subsidies and loan guarantees are no doubt grateful, though they probably see it as the government’s duty and their right. But someone has to pay for it. In the past, the redistribution of wealth through taxes meant that the haves were taxed to give financial support to the have-nots, at least that was the story. Today, through monetary debasement nearly everyone benefits from monetary redistribution.

This is not a costless exercise. Governments are no longer robbing Peter to pay Paul. They are robbing Peter to pay Peter as well. You would think this is widely understood, but the Peters are so distracted by the apparent benefits they might or might not get that they don’t see the cost. They fail to appreciate that printing money is not just the marginal source of financing for excess government spending, but that it has now become mainstream.

I will take you to the final para which ought to make you think very hard about where we are heading, but you may have to read the part in between, and perhaps also my own previous article to make sense of it. No one can know for sure, but why would you trust a central bank?

Earlier in the descent into the socialization of money, nations had opportunities to change course. Unfortunately, they had neither the knowledge nor the guts to divine and implement a return to free markets and sound money. Those opportunities no longer exist, and there can be only one outcome: the total destruction of fiat currencies, accompanied by all the hardships that go with it.

And while you are considering all this, let me bring this up as well: The Worldwide Lockdown May Be the Greatest Mistake in History.

The forcible prevention of Americans from doing anything except what politicians deem “essential” has led to the worst economy in American history since the Great Depression of the 1930s. It is panic and hysteria, not the coronavirus, that created this catastrophe. And the consequences in much of the world will be more horrible than in America.

Oh, really? How so?

The lockdown is “possibly even more catastrophic (than the virus) in its outcome: the collapse of global food-supply systems and widespread human starvation”. That was published in the left-wing The Nation, which, nevertheless, enthusiastically supports lockdowns. But the American left cares as much about the millions of non-Americans reduced to hunger and starvation because of the lockdown as it does about the people of upstate New York who have no incomes, despite the minuscule number of coronavirus deaths there. Or about the citizens of Oregon, whose governor has just announced the state will remain locked down until July 6. As of this writing, a total of 109 people have died of the coronavirus in Oregon….

Michael Levitt, professor of structural biology at Stanford Medical School and winner of the 2013 Nobel Prize in chemistry, recently stated, “There is no doubt in my mind that when we come to look back on this, the damage done by lockdown will exceed any saving of lives by a huge factor.”

To the left, anyone who questions the lockdown is driven by preference for money over lives. Typical of the left’s moral shallowness is this headline on Salon this week:

“It’s Time To Reject the Gods of Commerce: America Is a Society, Not an ‘Economy,’” with the subhead reading, “America Is About People, Not Profit Margins.”

And, of course, to smug editors and writers of The Atlantic, in article after repetitive article, the fault lies not with the lockdown but with President Donald Trump. The most popular article in The Atlantic this week is titled “The Rest of the World Is Laughing at Trump.” The elites can afford to laugh at whatever they want. Meanwhile, the less fortunate — that is, most people — are crying.

Maybe a year from now we will be looking back at all this and laughing. Or maybe not.

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18 Responses to Reaping the whirlwind

  1. mem

    When public servants pay tax it is a derivative of the tax on profit made by business. Many that work in government have no grasp of the fact that the neighbor or the couple living over the back who run a private business and who generally don’t have degrees , are the very people that pay their salaries.

  2. Robber Baron

    Sanitizer is now $10/litre. At the begining of the plandemic it was $150/litre.

    The sanitizer business is gonna need a bailout.

  3. Crossie

    Maybe a year from now we will be looking back at all this and laughing. Or maybe not.

    We will be too poor to laugh.

  4. Kneel

    When the left says “You can’t put a price on life!”, the response should be: “I’m not doing that, YOU are – every day.”
    Driving, flying, walking, cycling, shopping, working – all are to some extent risky. Do any of those (and pretty much everything else too), you risk death. Yet we all do these things. Why? Because we took a look at the risks and rewards and decided the risk was worth the reward. Starve to death or risk your life to eat – worth the risk, every time.

    Yet for this virus, we have been told we cannot make our own assessment of what is worth the risk, that we must not take any risk and just obey the “experts” – even when they have been demonstrated to have been (wildly) wrong in the past.

    And now the truth begins to emerge that IFR for this disease is in the low fractions of 1% – about the same as ‘flu – you remember they said it wasn’t comparable? Yet now, the numbers are saying it is like a ‘flu – overall mortality around 0.1-0.2%.

    So, we spent $60B of public money trying to support businesses crushed by Gov decree, and have millions unemployed for… season ‘flu levels of death. As a bonus, we don’t have “herd immunity” – unless it was actually here before, we just didn’t have a name for it. Sounds odd, but there was a rather nasty ‘flu in SA last November that killed IIRC 17. Was it this same corona virus? Could have been – we don’t and can’t know now.

  5. Rossini

    “Laugh till we cry!”

  6. Rohan

    Robber Baron
    #3463058, posted on May 24, 2020 at 7:26 pm
    Sanitizer is now $10/litre. At the begining of the plandemic it was $150/litre.

    I made sanitizer from materials I had in my lab. Got the thumbs up too from the staff. Nice citrus smell and I added a humectant to prevent dry skin. I wont tell you it cost $2.10 ltr

  7. NoFixedAddress

    mem
    #3463056, posted on May 24, 2020 at 7:24 pm

    When public servants pay tax it is a derivative of the tax on profit made by business. Many that work in government have no grasp of the fact that the neighbor or the couple living over the back who run a private business and who generally don’t have degrees , are the very people that pay their salaries.

    I have argued that by the very definition of Income there is no person that is receiving ‘monies’ from the ‘public purse’ actually entitled to pay Income Tax nor be subject to any of the provisions of The Income Tax Act.

    It is a ponzi.

  8. thefrollickingmole

    Rohan.
    Did the same at work.
    But I missed the cheapest alcohol by about a week, probably about $7 a litre here.

    I wonder how much money would need to be speculated down the drain before a lefty thinks it might be a problem?

  9. egg_

    And now the truth begins to emerge that IFR for this disease is in the low fractions of 1% – about the same as ‘flu – you remember they said it wasn’t comparable? Yet now, the numbers are saying it is like a ‘flu – overall mortality around 0.1-0.2%.

    So, we spent $60B of public money trying to support businesses crushed by Gov decree, and have millions unemployed for… season ‘flu levels of death.

    Shiny @rsed Medicos in charge – what could possibly go wrong?

  10. struth

    Mistake?
    It was no mistake.
    It is a UN organised attack on the west complete with slogans and organised at event 201.
    That’s provable now and no longer conspiracy theory.
    And no one has their freedom back yet.

  11. min

    Steve does that mean no new schools but water and coal fired powere stations that will produce an incomee?

  12. Roger

    When the left says “You can’t put a price on life!”, the response should be…

    The Left has no standing on the sanctity of life.

  13. Bad Samaritan

    How come Japan’s been printing money for thirty years, and now has a national debt 250% it’s GDP….while inflation remains non-existent; the Yen gets ever stronger; and interest rates have plummeted below zero?

    GDP growth there has been anaemic, but there is no whirlwind being reaped.

    This unfounded fear of hyper-inflation is therefore shown to be for pants-wetters only. Get another theory!

  14. egg_

    When the left says “You can’t put a price on life!”*, the response should be: “I’m not doing that, YOU are – every day.”
    Driving, flying, walking, cycling, shopping, working

    Obviously from ijiots living/working behind keyboards.

    *Insurance companies do every day.

  15. Terry

    ‘Maybe a year from now we will be looking back at all this and laughing.’

    Um, pretty sure laughter has been deemed by our masters as “non-essential”.

    If you still feel the urge, try this on-the-spot fine on for size.

  16. Re: the video – reminds me of the book “Confessions of an Economic Hitman”…..

  17. yarpos

    Although the government doesnt add value you would think that at least some of the organisations it contracts to do work actually do and its important those ones survive.

    Interesting piece on the evolving understanding of Covids mortality rate
    https://www.americanthinker.com/blog/2020/05/selfinflicted_destruction_of_america_all_for_nought.html

  18. Iampeter

    Maybe a year from now we will be looking back at all this and laughing. Or maybe not.

    Let me assure you that we are laughing now.
    Because you make really good posts like this but then turn around and support Trump.

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