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April 19, 2014 / 19 Nisan, 5774
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Posts Tagged ‘libertarianism’

What if Israel Were on the Gold Standard?

Wednesday, April 17th, 2013

Imagine for a moment that I want to buy a car for 100,000 shekels. I’d rather not work and save, so instead I decide to simply print 100,000 shekels in cash so I can buy the car. I print it, I hand the pile over to the car dealer and the car is now mine.

What just happened here? I counterfeited 100,000 shekels and increased the money supply by 100,000 when I handed those shekels over to the car dealer. The average person, the kind that has to work for his money would say that I stole 100,000 shekels. But today’s economic experts like Stanley Fischer and Ben Bernanke and Paul Krugman would say that I gave “economic stimulus to the automobile industry.” So what really happened?

When an average person works in the private economy and saves money to buy a car, he produces more than he consumes, hence savings. In other words, he puts more into the economy than he takes out, the difference represented by the money he saves. There is now more value in the economy, more stuff because he worked harder, and he takes that real value represented by the money saved and buys a car for 100,000 shekels.

The car dealer now has 100,000 shekels of real value to invest in expanding his business, and thanks to the value that the saver added to the economy through saving, there is now more value in the economy with the same money supply. The value of the shekel goes up and prices drop just a little bit, and everyone owning shekels gets a bit richer thanks to the saver. The car dealer can now expand his business and safely assume the demand is there to match his increase in supply. The economy grows.

Now, if I simply print up 100,000 shekels and give it to the car dealer, I added zero value to the economy. There is no more useful stuff. Just paper. I did not save a thing. All I am doing is taking from the economy without adding anything to it. Worse, the 100,000 shekels I added to the money supply makes the value of the shekel go down a little bit, since more shekels are now chasing the same amount of goods. Prices go up. Everyone gets poorer, except for me of course, because I got to buy the car before the money supply went up. The act of me buying the car was itself the action that made the money supply go up in the first place. I, the money printer and the first new money user, am up one car. Yay for me. But everyone else besides the first person to use newly printed money loses.

Now, let’s say I stop printing money and the car dealer expands his business with the new shekels. Since everyone is now poorer, there is no new demand to match his new supply. The signal he got of new demand for his cars was wrong, because the 100,000 shekels I printed did not represent added value to the economy through saving. Demand is not there, his business overexpands and he has to cut back and contract by selling cars for cheaper and taking a loss. His business shrinks or “goes into recession,” but cars get less expensive for everyone else.

But let’s say I keep printing 100,000 shekels every day and buy another car with it day after day after day. The car dealer will keep misinterpreting the sales as new demand that doesn’t actually exist. He will keep expanding. It will look like the economy is growing and growing, the statistics the government puts out on car sales will skyrocket. But really, only I and the car dealer are benefiting. Everyone else is suffering inflation and getting poorer and poorer every time I print. At some point I will have to print more than 100,000 to buy each car since the money supply is expanding so rapidly, but that’s no big deal for me. It takes the same effort to print 150,000 as it does to print 100,000. I keep getting richer. Inflation doesn’t bother me. The car dealer keeps expanding and cars become so expensive that no one can buy them. Then let’s say suddenly I stop printing shekels and stop buying cars. The car dealer’s business totally crashes, and he goes out of business in a bankruptcy sale. All the cars get sold to the public for ultra cheap. His business “goes into depression,” but cars are suddenly cheap for everyone else.

Moshe Feiglin Walks Into a Gay Bar…

Sunday, February 10th, 2013

A recent article appeared in Israel’s Ma’ariv newspaper (in Hebrew here) written by some guy who’s pretty decent, but doesn’t quite understand the concept of liberty all that well. To him, it’s a government guy saying he’ll fight for someone’s right to marry someone of the same sex, as if it matters who the government says you can marry at all, as if marriage were some sort of government institution. Marriage is whatever private people want it to be.

Moshe Feiglin himself does not fully grasp what liberty is, though he’s pretty close. According to him, the “status of the classical heterosexual family” has to be “protected,” as if saying that if the government does not actively “protect the classical family,” all of society will disintegrate into dysfunctional and total homosexuality.

What Feiglin doesn’t like, and I agree with him, is the government stealing money from one group and giving it to gay people. But the author of this article sounds like he’d like his own government goon to spend someone else’s money to promote same sex marriage with government funded advertising campaigns or something. I just want people to do whatever the heck they want to do without stealing money from anybody through government programs.

If the government subsidizes a gay couple (like gives them a tax break for being married according to the government), the people who don’t like gay couples get angry. If the government subsidizes a straight couple, the gay people who also want the subsidy get angry for not having “the right to be married”. It’s got nothing to do with a right to be married. It has to do with the right not to be stolen from. If straight people can get stolen from less (get a tax break) for being married, why can’t gay people? It’s always about money. Not marriage or love or tolerance. Let’s not forget that.

All Feiglin really should say is that the gay community should do whatever it wants, raise its own money, and stop trying to legislate laws which cost money and force unwilling people to pay for something they don’t believe in. And that as a Member of Knesset, he will make sure neither straights nor gays are being stolen from by government unequally.

Gay Jews, I call a truce! How about this: We the straight people promise to not get government to fund straight causes. You the gay people promise to not get government to fund gay causes. Then we can all go out for a drink at a mixed gay/straight bar. I’ll have the vanilla vodka with sprinkles and a cherry. You’ll have the whisky. Then we’ll go home and both do our familial thing, whatever that is.

The Ma’ariv article was a Kiddush Hashem. Whoever doesn’t see that and is wrapped up in the “homosexual abomination” thing, really does not have his eye on the ball of how healing this is. Moshe, thank you for doing this. Keep it up.

Here’s the link to my translation of the Ma’ariv article, on the homepage of Settlers of Samaria.

How the Free Market Redistributes Wealth Vs. How the Government Does

Monday, January 14th, 2013

Back in 2008 when I was still a Bill O’Reilly fan and a mainstream “neoconservative” type guy who loved the idea of spreading freedom with very powerful explosive devices throughout the world, I still didn’t like Barack Obama. It was on the Glenn Beck Program, who I am also no longer a fan of at all, that I heard some recordings of Obama talking on some radio show in Chicago about the failures of the Civil Rights movement in how they did not go far enough when they backed off from demanding court-ordered “redistributive measures” or something to that effect.

I specifically remember the word “redistributive” rolling off Obama’s silver tongue like a drop of glue-based dew on a glistening fake house plant shining in Vaseline basking in the artificial light of a sun lamp. It sounded so seductive and scary.

Go Glenn! I’d say.

Here’s how government redistributes wealth:

Government, benevolent and friendly and wanting to help the poor, seizes money by force from anything productive. Politicians take the money and start a welfare agency. The welfare agency provides paychecks for its bureaucrats, all of whom are friends of the politicians who seized the money. The benevolent welfare agency with the big heart runs out of money providing paychecks to all the bureaucrats running it before it hands out any stolen money to poor people, so the welfare agency lobbies for more money, which they use to expand the welfare agency and give more paychecks to more buddies of legislators, all of whom have huge hearts and went into the business of government bureaucracies to help poor people because they are so selfless. They run out of money again before they start doing anything, so they lobby Congress to steal more money from anything productive so they can do their job of eating paychecks more effectively, with huge big hearts of love and giving and benevolence.

With production down, there’s less stuff, making everything more expensive and hurting everyone’s standard of living. Then we are told that in order to increase our standard of living, the government needs more money.

A few months later, a welfare agency bureaucrat flips a quarter to a beggar on Capitol Hill, quintupling the amount of money given to the poor by the welfare system. The bureaucrat goes home all proud of himself for being such a selfless and giving human being and cashes his next paycheck.

The government runs out of money again, so they call on Ben Bernanke to print it, in the name of stimulating the economy.

Government thereby redistributes wealth from productive people to Congress’ best friends who out of the goodness of their souls, got jobs at a government welfare agency.

Here’s how the free market redistributes wealth:

Rafi and Natasha are paying 115 shekels a month in internet bills. Rafi and Natasha, those money grubbing selfish bastards with nothing but their own wallets on their minds all the time, look for a way to save money. All 115 shekels are going to the private money grubbing selfish internet company, which does nothing but think about how it can squeeze more money out of their greedy, miserly customers all day, every day.

In a fit of pure selfishness and miserliness, Natasha calls Angloprotekzia, a selfish miserly money grubbing company that thinks about nothing but itself all day. This company, purely in order to extract money from its customers, not thinking of the poor at all, provides a service of private negotiation with other private companies, and promises to lower Rafi and Natasha’s internet bills. In exchange, Angloprotekzia gets half of the savings.

In other words, they lower your bills in return for a commission.

Angloprotekzia, smelling the opportunity for money, cash-register heart beating and dollar signs filling its greedy eyeballs, calls the internet company and gets them to lower the bill from 115 shekels a month to 24 shekels a month, saving Rafi and Natasha 91 shekels a month that they can now use to sit there and count again and again, reveling in their money. Or invest. Or buy something with, whatever.

Previous score: Netvision 115, Rafi and Natasha 0.

New score: Angloprotekzia 45.5, Rafi and Natasha 45.5, Netvision 24. Total = 115 shekel.

Printed from: http://www.jewishpress.com/blogs/settlers-of-samaria/how-the-free-market-redistributes-wealth-vs-how-the-government-does/2013/01/14/

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