Beyond The Broken Spectrum

Men have chosen the precious metals gold and silver for the money service on account of their mineralogical, physical, and chemical features. The use of money in a market economy is a praxeologically necessary fact. That gold — and not something else — is used as money is merely a historical fact and as such cannot be conceived by catallactics. In monetary history too, as in all other branches of history, one must resort to historical understanding. If one takes pleasure in calling the gold standard a “barbarous relic,”[1] one cannot object to the application of the same term to every historically determined institution. Then the fact that the British speak English — and not Danish, German, or French — is a barbarous relic too, and every Briton who opposes the substitution of Esperanto for English is no less dogmatic and orthodox than those who do not wax rapturous about the plans for a managed currency. Read More

For thousands of years under the Old World concept of a static economy operating under bureaucratic control, human beings lived in hunger, filth, and disease. They worked ceaselessly at backbreaking drudgery to keep life in wretched bodies. They died young. For thousands of years, when not fighting wars, they managed to build pigsty shelters, to sow grain, cook meat, yoke oxen, and chain slaves to mills and oars. Read More

When the American Revolution had its beginning, living conditions had scarcely changed since the reign of Nebuchadnezzar. The colonial woman gathered her own firewood and cooked over an open fire, just as women had cooked since the dawn of history, and just as more than two-thirds of the women on earth are cooking today. She spun thread and wove coarse cloth, with a spindle and loom handed down from the early Egyptians. Every housewife made her own soap and candles and carried water from a spring or well. A crude millstone, dating back to ancient Babylon, ground the grain that the American farmer cut and threshed with knives and flails that were older than history. Read More

If you watch any of the financial channels for any length of time, you’ll eventually hear someone going on about how grateful we should be for government intervention: “thank goodness the government stepped in or the world financial system would have collapsed.” I’m afraid this kind of talk is going to go on longer than the war on terror.

If the bailouts are questioned at all, the TV talking-head will reply, “yes but everyone was worried in the fall of 2008 that they would go to the ATM and wonder whether any money would come out.”

“Look how rocky the markets were after Lehman Brothers filed bankruptcy,” they say. “Imagine if other big firms were left to fail!”

“If there had been no bailout and no stimulus, it would have been a depression for sure. Hey, it’s been bad, but if not for the wise men at Treasury and the Fed, we’d all be standing in soup lines or selling apples on street corners. Prices would plummet, we’d all be doomed.”

White House economic director Lawrence Summers said a year ago, “Deflation is a real risk facing the economy,” urging passage of a stimulus bill and taxpayer funds to bail out banks. Summers said that stimulus and bailouts were required for “our economic security.”

Do financial failures and falling prices mean the depression and stagnant economy that Summers and others fear? (more…)

Mises Daily:

When Keynes’s General Theory was published in 1936 there was no reason to believe that it would soon serve as the framework for 40 years of economic theory and policy. Almost to a man, every important economist of that era condemned the book and its message as confused, inconsistent and dangerous.

Joseph Schumpeter compared Keynes’s proposals with the types of economic policies pursued by France’s Louis XV, which led to the bloodshed of the French Revolution.[1] Friedrich Hayek angrily insisted that Keynes was asking us to abandon 200 years of economic theory and return to the crude and naive idea that somehow the more money you create the wealthier you become.[2]

And Kenneth Boulding declared that

Mr. Keynes’ economics of surprise, like Hitler’s, may be admirable in producing spectacular immediate success. But we need Puritan economists like Dr. Hayek to point out the future penalties of spendthrift pleasures and to dangle us over the hellfire of the long run.[3]

Yet, by 1946, only ten years after the appearance of The General Theory, all that had changed. Keynesian economics had swept the field and those who refused to accept the new vision were considered as out of date and antiquated as those who still believed that the sun revolved around the earth. (more…)

“The compound government of the United States is without a model, and to be explained by itself, not by similitudes or analogies,” James Madison said late in his life.

For all the truth of that, the Founders had models and ideas in mind as they hashed things out in Philadelphia in 1787, and the notes taken that summer by Madison and others are full of them. The Founders were practical men, almost all of whom had had some experience in government. But they also were keen readers and alert to history, as it was known in their day.

Among the models or theories they often brought up in debate or correspondence are the writings of John Locke and Charles Montesquieu; the works of Hume and other writers of the Scottish Enlightenment; British history; and the accounts then available of the confederacies, democracies and republics of ancient Greece and Rome and the Germanic tribes. (more…)

[Libertarian Review, August 1975.] Mises Institute

Though short-shrifted in most history books, the Panic of 1819 was an unforgettable nightmare for early Americans. Banks throughout the country were unable to make good on customers’ claims for specie and were forced to close their doors. Creditors foreclosed on deeply indebted farmers, city dwellers, and speculators who had bought cheap public land. Wages as well as prices dropped precipitously. Interest rates climbed and people moaned over the “scarcity of money.” Utmost in the minds of American leaders and influential journalists was the question, “Why did the boom die?”

The Panic of 1819, Murray Rothbard’s incisive and extremely well-styled Columbia University dissertation, provides an answer and a fascinating history of the era.

The panic and depression were a result of a huge monetary inflation. After the War of 1812, the economy flourished, as loosely chartered State banks issued redeemable notes far beyond specie. The quantity of money multiplied rapidly. In 1815 alone, bank notes increased from $46 million to $68 million.

Eventually, bank notes began selling at a discount, as foreigners and money brokers profitably claimed the notes for specie. In addition, the Bank of the United States’ began to call on branches to redeem other bank obligations. The monetary expansion ended abruptly and a wave of bankruptcies ensued. (more…)

Stephen Grover Cleveland (1837–1908)

To the House of Representatives:

I return without my approval House bill number 10203, entitled “An Act to enable the Commissioner of Agriculture to make a special distribution of seeds in drought-stricken counties of Texas, and making an appropriation therefor.”

It is represented that a long-continued and extensive drought has existed in certain portions of the State of Texas, resulting in a failure of crops and consequent distress and destitution.

Though there has been some difference in statements concerning the extent of the people’s needs in the localities thus affected, there seems to be no doubt that there has existed a condition calling for relief; and I am willing to believe that, notwithstanding the aid already furnished, a donation of seed grain to the farmers located in this region, to enable them to put in new crops, would serve to avert a continuance or return of an unfortunate blight. (more…)

Jesus was almost certainly a cannabis user and an early proponent of the medicinal properties of the drug, according to a study of scriptural texts published this month. The study suggests that Jesus and his disciples used the drug to carry out miraculous healings.

The anointing oil used by Jesus and his disciples contained an ingredient called kaneh-bosem which has since been identified as cannabis extract, according to an article by Chris Bennett in the drugs magazine, High Times, entitled Was Jesus a Stoner? The incense used by Jesus in ceremonies also contained a cannabis extract, suggests Mr Bennett, who quotes scholars to back his claims.

“There can be little doubt about a role for cannabis in Judaic religion,” Carl Ruck, professor of classical mythology at Boston University said.

Referring to the existence of cannabis in anointing oils used in ceremonies, he added: “Obviously the easy availability and long-established tradition of cannabis in early Judaism _ would inevitably have included it in the [Christian] mixtures.”

Mr Bennett suggests those anointed with the oils used by Jesus were “literally drenched in this potent mixture _ Although most modern people choose to smoke or eat pot, when its active ingredients are transferred into an oil-based carrier, it can also be absorbed through the skin”.

Quoting the New Testament, Mr Bennett argues that Jesus anointed his disciples with the oil and encouraged them to do the same with other followers. This could have been responsible for healing eye and skin diseases referred to in the Gospels.

“If cannabis was one of the main ingredients of the ancient anointing oil _ and receiving this oil is what made Jesus the Christ and his followers Christians, then persecuting those who use cannabis could be considered anti-Christ,” Mr Bennett concludes. The Guardian

This article goes in depth to reveal the nature of booms and busts and the government’s involvement in them.

Reliving the Crash of ‘29

Mises Daily: Monday, December 21, 2009 by Murray N. Rothbard

A half-century ago, America — and then the world — was rocked by a mighty stock-market crash that soon turned into the steepest and longest-lasting depression of all time.

It was not only the sharpness and depth of the depression that stunned the world and changed the face of modern history: it was the length, the chronic economic morass persisting throughout the 1930s, that caused intellectuals and the general public to despair of the market economy and the capitalist system.

Previous depressions, no matter how sharp, generally lasted no more than a year or two. But now, for over a decade, poverty, unemployment, and hopelessness led millions to seek some new economic system that would cure the depression and avoid a repetition of it.

Political solutions and panaceas differed. For some it was Marxian socialism — for others, one or another form of fascism. In the United States the accepted solution was a Keynesian mixed-economy or welfare–warfare state. Harvard was the focus of Keynesian economics in the United States, and Seymour Harris, a prominent Keynesian teaching there, titled one of his many books Saving American Capitalism. That title encapsulated the spirit of the New Deal reformers of the ’30s and ’40s. By the massive use of state power and government spending, capitalism was going to be saved from the challenges of communism and fascism. (more…)

By: Murray Rothbard via LewRockwell.com

This classic piece appeared in Ramparts, VI, 4, June 15, 1968. It was the fulfillment of an ideological trend that began a few years earlier when consistent libertarians, led by Rothbard, sensed an estrangement from the American right-wing due to its support of militarism, police power, and the corporate state. Here Rothbard presents a rationale for why he and others had, by 1968, largely given up on the Right as a viable reform movement toward liberty, realized that the Right was squarely on the side of power, and thereby developed an alternative intellectual historiography. The relevance of this essay in our own time hardly needs to be explained, given the record on liberty of the Republican president, congress, and judiciary, to say nothing of conservative and right-wing media.

Twenty years ago I was an extreme right-wing Republican, a young and lone “Neanderthal” (as the liberals used to call us) who believed, as one friend pungently put it, that “Senator Taft had sold out to the socialists.” Today, I am most likely to be called an extreme leftist, since I favor immediate withdrawal from Vietnam, denounce U.S. imperialism, advocate Black Power and have just joined the new Peace and Freedom Party. And yet my basic political views have not changed by a single iota in these two decades! (more…)

According to a 70 year old genealogist and his grand-daughter, President Obama is related to every other president except for Martin Van Buren. They all trace back to a king of England, John Plantagenet.

The story at http://www.ksbw.com/news/21404492/detail.html

There’s nothing more traditional in American politics than the wholesome family portrait: a beaming candidate, beaming spouse, reluctantly beaming teenagers.

But when Bill de Blasio, a candidate for public office in New York City this fall, put his family in his campaign mailings and TV ads, there was nothing routine about it. De Blasio’s wife of 15 years, Chirlane McCray, is black, his children are of mixed race and, even in one of America’s most liberal cities, no one could remember anything like it.

De Blasio, 48, won the crucial Democratic primary in a runoff Sept. 29 and is in line to be the city’s next public advocate, a sort of high-profile ombudsman’s job that’s second in the line of succession to the mayor. The city councilman from liberal Park Slope, Brooklyn, had other things going for him — institutional support, newspaper endorsements — but in the view of his campaign, and of many of the city’s political observers, his interracial relationship was an almost unmitigated positive in a hotly contested election.

Continued at Politico