Deflationary policy is costly for the treasury and unpopular with the masses. But inflationary policy is a boon for the treasury and very popular with the ignorant. Practically, the danger of deflation is but slight and the danger of inflation tremendous.
Bubbles, as we have seen, result from deliberate "expansionary" policies by government authorities, yet Krugman always seems to treat them as being solely the products of private enterprise.
The world already has the Great Depression as a warning. But governments and the bureaucrats who run them have decided to ignore the lesson. The new crisis of interventionism is fast approaching, and the market will not wait for governments to realize their errors.
It shouldn't come as a surprise if it eventually turns out that the real danger is, like so often in the past, inflation rather than default.
Property rights, when well-defined and protected, create incentives for self-interested owners to utilize resources in numerous ways that promote the social good.
"The true villains were clearly the bankers themselves."
– Mark Gilbert, Complicit
Abuse of the GDP equation leads economists and pundits to blame savings and praise reckless consumption, to hate imports and love exports, and (in principle) to attribute a doubling in the flow of goods coming out of factories to a nonchange in the level of a nonexistent stock of inventory.
Libertarians should not shy away from presenting "policy issues" in terms of their actual meaning — in terms of criminality versus law.
Moreover, the obligations of nondiscrimination and transparency will have negative effects on innovation, investment, and prosperity, instead of the positive effects that may be expected from the openness of the Internet.
State-issued money, as the "critical command post," serves to subtly reinforce the authority of the state, insidiously plunder the savings and purchasing power of its subjects, and massively manipulate the economy.
