Morgan Reynolds, most recently the chief economist for the Department of Labor, talks to the Austrian Economics Newsletter about his experience, the mistakes of the Bush administration, the business cycle, the status of labor unions in America, his intellectual formation in the Austrian tradition, and his predictions for the future.
In the writings of modern evangelical environmentalists runs a disturbing theme: the idea that it is possible for a small group of individuals to improve upon our use of the environment through coercion. In the name of stewardship, they lay claim to control of every aspect of our lives.
How are fiat money and the business cycle related? Without sound money, calculation is less efficient and the economy will be prone to business cycles. With sound money policy, no boom-bust cycle will emerge and monetary calculation and planning will be as efficient as possible in an uncertain world. John Cochran explains.
No other currency, national or international, can conceivably take the place of the American dollar. They all suffer seriously from the same ideological malady: they are the creation of political concern and authority. Whatever we may think of gold, it always looms in the background, beckoning to be used as money, as it has been since the dawn of civilization.
Late last year, in a move that gives even politics a bad name, the Federal Reserve announced yet another cut in its key interest rates. Around the same time, Fed Governor Ben Bernanke gave a speech praising the power of alchemy to lower the price of gold, and, similarly, the power of the Fed to print as many dollars as it wants. Hence, the Federal Funds Rate is down to 1.25 percent, while the discount rate stands at 0.75 percent.
Was it just a Freudian slip that Greenspand started his recent encomium for Keynesian debasement with a reference to the Gold standard? It was probably inadvertent, but the contrast suggested between real, hard money, freely chosen by market processes, not arbitrarily by the State and its Financiers, was no less resonant for the fact that it was implicit, rather than as shockingly explicit as in Bernanke's recent speech on the subject.
The existence of the money multiplier is the outcome of fractional reserve banking, writes Frank Shostak, which the current banking system makes possible. The money multiplier is not only real; it is a good tool to help us understand the process by which the banking system creates inflationary credit and all of its associated effects.
Murray Rothbard had a remarkable ability to throw unexpected light on historical controversies. Again and again in his work, he pointed out factors that earlier authors had overlooked.
Liberty is incompatible with taxation, writes Tibor Machan. This is despite the famous saying by Oliver Wendell Holmes that "Taxation is the price we pay for civilization." In fact, taxation is a most uncivilized way of obtaining funds, given that it boils down to nothing less than extortion.
No one can contend that the Federal Reserve System has brought economic stability or conquered the trade cycle, writes Hans Sennholz. On the contrary, its critics are convinced that a politically conceived and administered money monopoly, such as the Federal Reserve System, is the worst of all money systems. It will breed business cycles as long as it lives.
