The so-called recovery is only built on debt and printed cash declares our own Byron King. In the long term, the only option for the government to continue financing it's operations is to print too many dollars. Money printing has it's limits, however. It's Byron's opinion that at some point, perhaps very soon, the government will have to turn to more desperate measures. Namely, capital controls. In the following featured essay, Byron outlines 4 probably ways the government will take your cash and one play you can buy through your broker to prepare today. Read on...
Americans expatriate because they want to get out of the country. Corporations expatriate for similar reasons. Clem Chambers explains...
Say goodbye to your boring morning commute. New technologies are changing the way people drive their cars. It’s making them safer, more fuel efficient, and could reshape the way America builds its roads and cities. The only thing that could stand in the way...
In a 2009 article, the Huffington Post went into considerable detail about the number of people with PhD degrees in economics employed by the Board of Governors of the Federal Reserve System. This is the government’s branch of the Federal Reserve. It is not one of the 12 regional Federal Reserve banks, all of which […]
The U.S. dollar is the dominant global reserve currency. All markets, including stocks, bonds, commodities, and foreign exchange are affected by the value of the dollar.The value of the dollar, in effect, its “price” is determined by interest rates. When the Federal Reserve manipulates interest rates, it is manipulating, and therefore distorting, every market in […]
When the NSA surveillance news broke last year it sent shockwaves through CERN, the particle physics laboratory in Switzerland. Andy Yen, a PhD student, took to the Young at CERN Facebook group with a simple message: “I am very concerned about the privacy issue, and I was wondering what I could do about it.”There was […]
The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance or the get-rich-quick adventurer. They will die poor.– Jesse Livermore, How to Trade in StocksThe trouble with capitalism’s guardians is that they have no […]
Let’s head back in time…In 2004, a mere decade ago, the US national debt rang the register at $7.4 trillion. That represents “debt per citizen” of over $25,000. You, me, your neighbor, your 4-yr old grandson, you name it and they’re portion of the U.S. debt is $25k.But flash forward to today and you’ll see […]
John Foust, a Democrat running for the 10th congressional seat in Northern Virginia, is — like Gov. Terry McAuliffe and other state Democrats — gung-ho to expand Medicaid. His wife’s position is, shall we say, a bit more nuanced.Foust has slammed his opponent, Republican Del. Barbara Comstock, for her opposition to expansion. He has spoken […]
The midterm election season is upon us, and it’s a tossup whether the Republicans will win the Senate, or if President Obama, seemingly oblivious as conflict flares up around the world, will, through his continuous campaigning, keep Harry Reid in his majority leader seat.The only thing we know for sure is that sociopaths will be […]
Alexander Hamilton was America’s first Secretary of Treasury under President George Washington. When he first entered office in 1789, America was an agricultural nation of just 4 million still broke from its financially costly victory over the British Empire in the Revolutionary War.The states had accumulated relatively massive debts to finance that war, which mostly […]
I was talking with one of my colleagues the other day, and he raised a very interesting question, one that deserves consideration by anyone worried about their digital privacy. He read an article that championed the idea that the more steps one took to protect their privacy by using anonymous Web-browsing tools like Tor, the […]
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 […]
“This used to be a hell of a good country, I can’t understand what’s gone wrong with it.” said George Hanson in the movie “Easy Rider.”
My old friend Joe Sobran (1946-2010) loved that line and quoted it often.
Sobran, who worked alongside William Buckley at National Review during its heyday, was one of the smartest people I’ve ever known. After a lifetime of thinking about politics, he eventually decided that there was only one way out of our troubles: the whole of the government has to go.
[Editor's Note: Joe's key influence was Hans-Hermann Hoppe. Hoppe's Book The Theory of Capitalism and Socialism convinced him that nothing that the government does contributes to the betterment of society as whole. A new edition of this book is now available for download in the Club.]
Sobran was ahead of his time. The latest polls show that 9 in 10 people distrust government to do the right thing. Forget partisanship at this point. The largest political grouping in this country is against government in general. Sure, people are glad to grab benefits as programs allow, believing that they might as well get something back for all the times they have been robbed.
Does public opinion matter? Absolutely. Government an inherently unstable situation because they are few and we are many. The real question is not why revolutions happen but why isn’t there a revolution every day? What is it that keeps these guys in power, aside from the threat of violence? There has to be more to it.
David Hume, in his First Principles of Government, argued that it is public opinion that keeps the racket going. That is a more important thing than violence or guns. It is what people believe about themselves and their government that is the key. Without it, government would collapse. And we see this in history. The precondition for every revolution is the lack of belief in the system that governs them.
The government has strong interest in shoring up public opinion.
According to Hoppe, it does this through the control of four institutions:
A government that fully monopolizes these four institutions and prevents any alternatives from forming is secure in its rule for decades if not centuries. But when they begin to fall, the rulers begin to lose their grip on power. For this reason, all governments have made the control of these institutions a priority.
Control of education allows the political class to inculcate a sense of civic obligation and duty, set the parameters of approved thought, and keep revolutionary ideas from entering into the culture. If you can get the kids at a young age and train them, all the better. This is why every state the world over has worked to secure its control over education. The goal is not to make everyone smart but rather to make everyone obedient.
Control of communication reinforces this tendency to properly filter the ideas that people hold. This is why censorship is one of the first and long-lasting functions of government. It is not to protect you and me against hearing or seeing things that would corrupt our hearts and souls. The idea is to maintain a firm grip over what people believe about the political system and to keep outlying ideas underground and at the margins of society.
Money comes next. Historically, this is one of the earliest institutions that the state seeks to monopolize. Only in the 20th century has the excuse been to keep unemployment down or keep the banking and financial systems stable. The real reason is, as Hoppe explains, to provide a funding source for government that doesn’t require taxation. Taxes make people mad. Devaluation and inflation flies under cover of night.
Finally, there is the need to monopolize the provision of security, which means controlling courts, police, and justice. The idea here is to be able to tell the population that the government is keeping everyone safe. If government is not there, terrible things will happen: monsters will take over.
Now, using this model, we are in a position to assess the stability any regime. Looking back at the anti-socialist revolutions of 1989 and 1990, we can see that all four conditions of control had collapsed, and so therefore the people no longer believed. We saw this too in the Arab spring. We can even look back at the American and French revolutions and see the same thing. In each case, the government systems of control fell and private alternatives took their place. The revolution happened.
How does this apply to us today in the U.S?
Consider communication. Twenty years ago, that monopoly was in tact. The government ruled the networks, controlled the press, owned the telephones, censored the radio, and there were few alternatives outside word of mouth and the ham radio.
Today? Wow. The communication monopoly is completely smashed. The internet, cellular networks, the explosion of media outlets, and the astonishing growth of all forms of human interaction on a global level mean that this side of state control has been obliterated.
The educational system is cracking in a huge way. We learn more from digital networks than from government-owned classrooms. The kids still show up but do they believe? Not really. The dream of inculcating generations in dedicated belief in the civic system is just gone.
Homeschooling continues on the march, and the products of this system are occupying important positions of influence in the culture. Online venues are huge. The university-level system is poised for massive correction in the downward direction.
The money system is seriously broken. The Fed prints and prints but it is not inspiring economic recovery or even bringing about the inflation that would be necessary to cover the government’s astonishing debt level. A measure of the monopoly’s effectiveness is the lockdown of bank lending and the downgrade of U.S. bonds that occurred last year.
Because of this failure, new forms of private money are flourishing: precious metals, digital currencies, gift cards, cash-based credit cards. Peer-to-peer lending is booming. More challenges to this monopoly appear by the day.
Police, justice, and security? This is an interesting case. Thirty years ago, the police were not militarized, the courts were not clogged to the point of being useless, the jails were not full to capacity, and there was a sense that the system was flawed but essentially workable. That is no longer true.
After 9-11, the state overreached and militarized the entire security system in this country, thereby exposing its essential nature. More and more people are catching on to the reality that the security system is not there to protect us but rather to protect the state itself from us.
Hoppe’s checklist provides an extremely revealing look at the stability of the political system today. How far are we from a real or de facto revolution in which private society displaces the corrupt and bankrupt public system? It could be sooner than anyone predicts.
A Theory of Socialism and Capitalism shows us what to look for and how to access the triggers that make dramatic change possible.
Final note: if the ideas in this article seems outlandish, it is wise to compare them to the ideas in circulation in the U.S. colonies in 1775. A whole general favored the abolition of government. “The instant formal government is abolished, society begins to act,” wrote Thomas Paine. “A general association takes place, and common interest produces common security.”
We’ve traveled a long way from these ideals. Thanks to technology and the breakdown of government monopolies, we are travelling down the other direction toward freedom.