In the minds of many people around the world, including in the United States, the term “capitalism” carries the idea of unfairness, exploitation, undeserved privilege and power, and immoral profit making. What is often difficult to get people to understand is that this misplaced conception of “capitalism” has nothing to do with real free markets […]
When you type a website address into a browser, you might have noticed that the letters “http” appear at the front. “HTTP” stands for Hypertext Transfer Protocol. In typing a Web address, you are actually sending an HTTP command to transmit that website to you. Hypertext Transfer Protocol is the means by which information is […]
Some people are saying it is just what the doctor ordered. Others are saying that the cure is worse than the disease.The Affordable Care Act? Reengagement in Iraq? Tea Party bullying in the GOP?Not this time. Just as protracted in the corridors of Congress and the White House is the debate over the proposed reform […]
In 2012, money mandarins running the European Union chose stagnation over restructuring. Here’s a consequence of that choice: expectations for a self-sustaining economic recovery keep getting crushed.Two years ago, European Central Bank (ECB) chief Mario Draghi promised to do “whatever it takes” to hold the eurozone together. He bluffed nervous investors into believing in a […]
Picture the scene. It’s 2020. You’re at the checkout in a convenience store with a carton of milk. But you’ve got no cash and you’ve left your cards at home. No problem. You scan your right index finger; the green light flashes. Purchase approved and you leave. Easy.Is this a realistic vision of the future, […]
“In the beginning, all the world was America.” — John Locke“The Garden of Eden was a perfect place,” my friend Manuel explained. “Man had free will. He could live in harmony with nature and God — and everything would be fine. But if he defied God, the stain of original sin would be on his […]
After a week of reckoning about the American oil and gas boom… I’ve got to get something off my chest.I can’t stand it when a coworker takes credit for something I did.Whether it’s a special report I wrote or just a little investing trick I found on my own — if someone takes it and […]
It might sound like the latest new product from Apple, but IPAB is actually the newest major legal challenge to Obamacare.Recently, a three-judge panel in the 9th Circuit Court of Appeals in San Francisco heard arguments about the Independent Payment Advisory Board, or IPAB, a 15-member panel created by the Affordable Care Act and empowered […]
Americans have come to believe that the IRS and the income tax are inevitable parts of our lives. After all, most everyone alive today has lived his entire life under federal income taxation.It wasn’t always that way. For some 125 years, the American people lived without having any tax imposed upon their income.The obvious question […]
Here’s a fun fact: Although we all hate the U.S. dollar, as it continues to hemorrhage wealth, its foothold as the world’s reserve currency isn’t going to disappear overnight.A Russian gas deal with China won’t change that — as we’ll highlight below.But before we get to the nitty-gritty, let’s dive into a story that’s right […]
Franklin Delano Roosevelt famously used the term “forgotten man” in a 1932 speech to describe those at the bottom of the economic pyramid who, he felt, government should aid.But the originator of the phrase “forgotten man” had a whole different meaning in mind. He aimed to expose the seeming good intentions of government to reveal […]
“As the nation’s central bank, the Federal Reserve derives its authority from the Congress of the United States. It is considered an independent central bank because its monetary policy decisions do not have to be approved by the President or anyone else in the executive or legislative branches of government, it does not receive funding […]
The Keynesian disaster recovery plan has been to lower rates, force people to take more risk in search of yield, and entice others to borrow and spend and, magically, more jobs will be created. If people won’t buy stocks, central banks will.Back in 2011, Ben Bernanke, when asked if QE2 was driving up stock prices, […]
In September 2009, when President Obama made a primetime speech pitching his not-yet-passed health care overhaul, he made the following promise: “I will not sign a plan that adds one dime to our deficits — either now or in the future. Period.” To prove his seriousness, he further promised that “there will be a provision […]
Whatever your views on the role of government, one thing is clear: There will be no way to pay for it if the economy doesn’t grow. And I’m not talking by a measly percentage point or two. If we can’t find our way back to 5% annual economic growth or above soon, America’s accumulated federal […]
According to the Bureau of Labor Statistics, consumer prices are rising at a 2.1% annual rate. This suggests to us that the current stock market boom will die with a bang, rather than a whimper.Fed economists say they don’t think inflation rates are rising. They think the most recent reading is a fluke. But why […]
Real progress happens through real people, ideas, and innovations. Not by legislation argued and debated in Congress. Right now, one of the most influential technologies is changing the way people do business. And reinventing the future in the process.
Innovation can change the world… if the world lets it. Unfortunately, society’s gatekeepers make it a point to constrain, regulate, and control these ideas. But their power is limited, and the power of innovation is too great. Unfortunately for regulators, there are some technologies they can’t control.
“Everything is proceeding as I have foreseen.” — Emperor Palpatine, The Return of the JediJon Stewart made great comedic hay during the Bush Administration out of the enormity of Dick Cheney’s “Sith Lord” malevolence. Events in Iraq in the past week have made especially palpable Cheney’s Palpatine-like quality.As Iraq unravels, you may suspect that Cheney might now […]
Entrepreneurs are high-tailing it out of the United States, and it’s the politicians’ faultThe U.S. government is driving some of its most productive citizens abroad. The only beneficiaries are countries such as Singapore and Switzerland, which offer sanctuary to Americans fleeing avaricious Uncle Sam.Three years ago Eduardo Saverin, one of Facebook’s founders, joined 1,780 other […]
Politicians love raising the minimum wage because they don’t have to ask voters to pay more in taxes. They just dump the costs onto shop owners. But they don’t act like politicians and go into debt to pretend like they have all the money in the world. They face real world situations. And sometimes that means replacing workers with more affordable options...
A cushy job in Hawaii that pays six figures. A beautiful girlfriend/boyfriend. Job security and professional experience that gives you plenty of future opportunities. Would you throw that all away to do what you think is right? Last year, one government contractor did just that. And now you see the world the government tried to hide from you.
As the world gets more digital, people forget about the benefits of transacting in cash. And government officials know that.
Regulation is supposed to keep you safe and make the economy function smoothly. At least that’s what they tell you in the news. But there’s another cost to regulation. One that you won’t hear about unless you have to deal with directly. And for the people in the economy who do, they’re the ones who have to pay the final cost.
The experts will tell you the recession is over, but they’re only torturing the data to hide the truth. The economy never recovered from the downturn it experienced. But the downturn happened in 2000, not 2008. The country’s been in the middle of a 14 year recession and hardly anyone knows the truth.
All paper currency has a shelf life. It could be 5 years or 500 years, but at some point, the value of any paper currency eventually reaches zero. That's why, for centuries, people have turned to one shiny metal to safeguard their personal store of wealth. And, as Jim Rickards explains, you still have that option. Read on...
Edward Snowden’s one year visa in Russia expires at the end of next month. With only a few weeks left before he finds himself without a safe country to live in, he sat down to give an exclusive interview. Here are the most important things he wants you to remember from his recent sacrifice.
Hanging out in Rome, surrounded by ruins of all ages, you can’t help but have big thoughts about the state of the world. Here are a few of mine.
No generation during the long fall of the Roman Empire was really aware of it. Each generation accepted the conditions they inherited and worked to survive as best they could. And so it went for hundreds of years. The “fall of Rome” was obvious only to historians. It never really felt like falling.
Europeans and Americans should know something about that. There have been no appreciable gains in real median household income in the U.S. since the mid-1970s. We work harder and longer for less. Two-income families are a necessity. Young people are full of angst about the future.
As for Italy as a nation, the third millennium has been a disaster of unrelenting decline.
Then and now, the same stuff dragged us down: massive public debt, bureaucracy, unsound money, imperial ambition, official corruption, parasitism, capital depletion, and, above all else, the exaltation of the rulers who loot and destroy over the ruled, who actually build and sustain civilization.
I’ve been in Rome for a week attending an academic seminar, strolling the streets, meeting old friends, touring behind the scenes at the Vatican, and otherwise feeling the buzz amid the ruins and continuing struggle.
Close up, you get a different picture. The official economy is failing, but the unofficial one is busier than ever.
It’s so easy to forget that the economic life of our times is not found in the headlines, the big trends reported by international agencies, or the political trends of who is up and down.
With wingtips on cobblestones, you see a part of economic life that these data do not reveal.
Walk the streets in all directions of the Piazza Navona and what you find is a land of thrilling commercial activity. Money is exchanging hands in the manner of the ancient world, but the products are new. There are loads of so-called “pirate” goods — name-brand fakes that both buyer and seller understand are not the real thing. Forget credit cards. No one takes them. It’s a cash-only world.
Actually, it’s not that different in the hundreds of bars and restaurants around the bustling parts of Rome. People don’t want plastic. Some take it, but dread it. Why? It all comes down to tax collection, regulation, and the massive apparatus of command-and-control that is modern politics. No one wants any part of it. If you can get away, you would be a fool not to.
And there aren’t too many fools in Rome.
The value-added tax is an angry bear, and an enterprise killer. It is enforced in the most wicked way. The tax police ride around in vans and pull up to the restaurants. They demand all records and check out whether the taxes are being enforced. I suppose it’s the Italian context here, but it seems more like a mob shakedown than public policy, and who can really tell the difference?
The whole scene is a reminder of how little we actually know for sure about the structure of the world economy. Some estimates suggest that one-half to two-thirds of the workers of the world owe their jobs and livelihoods to the existence of the “informal sector.” That means, essentially, living and trading outside the officially approved ways.
Anytime I talk to any Roman about politics, I ask the same two questions:
1) What does the government do around here?
The answer is always the same. It takes people’s money in whatever ways it can.
2) What does the government do with the money?
The answer is always the same. The money supports the politicians and bureaucracies.
And that’s how the whole political system works. Money in, money out. Why not just scrap the whole thing? Sure, but no one really knows how to do that.
As with every other democracy, the people slog to the polls at the appointed time and vote for some kind of dramatic change, every single time without exception. It never happens. A few years later, the same thing happens again, except that this time the state is bigger and more corrupt than ever. So on it goes.
As one Roman told me, the only real solution to the parasitic state is unthinkable. What that means in practice can be found variously in Shakespearean tragedies, and speaking about such things is rather dangerous. Besides, people are too busy trying to survive to bother with futile undertakings like revolution.
Rome is surely one of the busiest commercial places on Earth. Marketing is a way of life. Buying and selling are the essence of all activity. People here are the world masters of extracting money from tourists, especially naive Americans who know nothing of the streetwise ways of the old-world merchant class.
Given all this busy-as-bees commerce, where is the burgeoning prosperity? By historical standards, people are doing well. By standards of the U.S., Canada, and Asia, not so much. Why can’t Italy and the whole of Europe put a stop to the decline and re-enter a growth path? Why does all this commercial activity not translate to real economic growth?
Rising prosperity is simply not possible without that much-maligned but still-essential institution called private capital. Private capital allows long-term investment and complex divisions of labor and specialization and creates the infrastructure for long-term economic thriving.
But all over Europe, the capital stock is seriously depleted. It’s been killed by the VAT, by intrusive politicians, but most of all but the desperate desire on the part of the ruling elite to steal anything and everything in sight. People traditionally blame invaders for the fall of Rome. Nonsense.
The invaders are not the problem. The real problem are the nationals who know the system well enough to manage it for their own benefit and at the expense of everyone else.