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A People's Economic Revolution

Mises Daily: Tuesday, June 11, 2002 by

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People's revolutions generally have their origins in inappropriate governmental behavior. This behavior may be exploitative, it may be oppressive, tyrannical, or even despotic. In rare instances, the opportunity may present itself whereby the people may rise up and overthrow an otherwise unpopular government. Not all successful uprisings, such as the Bolshevik Revolution or Iran's anti-American revolution, are to the long-term advantage of all citizens.

The recent monetary and economic upheavals in Argentina, caused by state behavior in the monetary system, now make that country ripe for a peaceful people's economic revolution. The foundational ideas of such a revolution have been written up in the works of economists such as the late Murray Rothbard. Rothbard argued that an absence of forcible coercion in human relations and freedom of peaceful action would form the basis of a free society as well as a viable free-market economy.

The meltdown of Argentina's monetary system leaves the bulk of the population there with little choice but to peacefully take economic control away from their government, through a nationwide informal or underground economy. Ludwig von Mises advised in his writings that people would revert to bartering in the event of monetary destabilization.

In recent weeks, large numbers Argentineans have in fact been turning to the underground economy as a means of economic survival. Most of the participants may never even have heard of Mises or Rothbard, yet their ideas offer hope to large masses of people who are willing to peacefully engage in a voluntary exchange of goods and services.

In Argentina today, there exists a small number of people who have actually read the works of Mises, Rothbard, and Hayek and are familiar as to how these ideas and theories can apply to a real-world economic environment. The central leadership idea offered implicitly by Rothbard's theories is that a peaceful mass revolt and mass rejection against centralized economic power and centralized economic control is possible through mass underground economic action involving the majority of a nation's population.

This implicit idea can put the collective decision making of the masses of individual people who are engaged in peaceful and private economic planning in direct control of Argentina's economic recovery, as well as its future economic evolution. Whereas political opponents may imprison a Mandela or assassinate a Gandhi, a peaceful revolution led by a well-formulated idea presents the opponent with a far more perplexing adversary.

A successful nationwide informal economy operating in Argentina, one that benefits large masses of citizens, has the potential to politically embarrass governments of other nations. The tools of production that are available today are far more advanced and far more efficient than their predecessors of bygone eras, when bartering flourished. Far higher individual levels of productivity, involving large numbers of people, are possible today. Modern computer technology enables accurate tracking of credits and debts incurred in local regions by participants in the underground economy.

Argentina has a long history of oppressive governmental behavior as well as of state economic misbehavior. Severe state action to combat mass informal economic activity is almost a foregone conclusion, despite the fact that over half of Argentina's 37 million overtaxed citizens live below the poverty line.

Argentina's elitists, mercantilists, and statist parasites would inevitable resort to oppressive measures to rob the masses of control of their economic destiny. Foreign assistance to Argentinean governmental forces in this regard is also a foregone conclusion, despite it having the potential of precipitating a return to oppressive state behavior in areas beyond the economic arena. Argentina's elitists are practically guaranteed support from players in Washington and Brussels in this regard.

A nationwide informal economy in Argentina not only has the potential to embarrass foreign political leaders, but it also has the potential to illustrate to the citizens of the world that the masses could rise up against statist economic oppression, in a people's economic revolution driven by the ideas of Rothbard, Mises, and Hayek.

The well-being of the majority of a nation's economically disenfranchised citizens could be realized without any state control of the nation's money supply or state regulation of peaceful economic activity. It is a lesson that the IMF, the World Bank, and a few national leaders would prefer that it never be illustrated in the real world. It is a lesson that could inspire entire populations of economically disadvantaged citizens living elsewhere in the not-so-free world to wrest control of the economy away from the statist elitists.


Harry Valentine, a commentator on economic issues, lives in Canada. Send him MAIL.