Interventionism

In the days of yore, to say that a man was discriminating was to pay him a compliment. It meant that he had taste: he could distinguish between the poor, the mediocre, the good, and the excellent.

Crystal meth is a horrible drug, but it is also a cheap date, the poor man’s cocaine.

Crystal meth is a horrible drug, but it is also a cheap date, the poor man's cocaine. During cocaine's heyday, meth was nearly extinct on the illegal market. Then came the war on cocaine.

If the cost of labor increases, someone has to pay for it. Laborers may pay in the form of decreased work opportunities, investors may pay in the form of decreased returns on capital, or consumers may pay in the form of higher prices required by increased costs.

It doesn’t seem to matter to Obama that the federal debt already has us $14 trillion in the hole — $140,000 per household. The answer from the Harvard masterminds is to unionize the contractors and subcontractors, to jack up the price of a mile of road to even more inflated levels.

Most people are attracted to real estate because they perceive it to be a high-powered game. They envision building empires the way that most of us have done on the Monopoly board. People like real estate because it is a sexy investment.

Hoover's interventionist policies focused on labor markets with the goal of keeping wages and employment high. Bush's interventionist policies focused on capital markets with the goal of keeping financial markets functioning.

Most Austrians stop short of following Chicago School economists' advocacy of the "efficient-markets hypothesis" (EMH). In its most extreme form, the EMH becomes a caricature of itself in which asset bubbles are not just unlikely but logically impossible.

The famous physiocratic tenet that only land is productive must be considered bizarre and absurd. It is certainly a tremendous loss of insight compared to Cantillon, who identified land and labor as original productive factors, and entrepreneurs as the motors of the market economy.

Recorded on 4 December 2010 in Rochester, New York.