It was Mises, before Hardin, who identified the problem of overutilization wrought by public property. The problem is not limited to land ownership, however. In banking, writes Philipp Bagus, common deposit ownership leads to credit expansion and finally the drive to centralized control of money and banking in the form of a central bank.
Britain is similar to America in that it is suffering from the same political and economic maladies that have befallen its transatlantic cousin. Indeed, faced with a burgeoning fiscal deficit, fiat money-precipitated economic imbalances and renewed imperialism, albeit at Washington's behest, the U.K.'s own variant of "War, Prosperity and Depression," underscores the sources of America's woes. Grant Nülle explains.
Since the early 17th century, American governments (colonial, state, and federal) have tried and failed to restart business expansions by reflation, writes Scott Trask. But new money in the system is no substitute for genuine production. It is too early to see the long-run consequences of the Bush-Greenspan reflation, but if the past is any guide we can expect the next decade to more resemble the 1970s than the 1990s.
Hans Sennholz writes: No central bank on earth, not even the Federal Reserve System, can continually inflate its currency and defy market rates of interest without harming both its currency and the economy. Inflation tends to accelerate and ultimately destroy the currency and cripple the economy. And no government whatsoever can suffer budget deficits of half a trillion dollars annually without impairing its standing with its creditors.
The disappearance of gold from the monetary scene is perhaps the most tragic economic calamity to befall the world of money in the twentieth century, writes Christopher Mayer. Views on gold in the first two decades of the twentieth century compared to those held today could scarcely be more different.
The tax bills of many American families are falling during a period of exorbitant increases in federal spending due mainly to war and welfare spending. Odd? Not once we discover the record levels of government debt accumulation. It's the shell game of government finance at work.
H. Scott Trask sums it up: on the one hand, they believed in fractional-reserve banking, generally following Adam Smith's currency and banking theories. On the other hand, they were resolutely opposed to government-issued paper money, fiat money, legal tender laws, inconvertible paper currency, and land banks. On the question of a national bank, they were divided.
Central banks are a recent development in the history of civilization—the culmination of years of consolidation—but the tendency of governments to inflate the currency is not.
What's wrong with a futures market in terrorism? It is not a genuine market creation. A growing recognition of the superiority of markets over planning has created an unviable hybrid: the planned market, one created not by property owners but by the state and for the state. Planned markets bear a close enough resemblance to the real thing to fool even astute observers who are otherwise friends of genuine market forces.
If you stuck a dollar in a savings jar in 1913 and tried to spend it today, you would find your purchasing power had been sapped. Your dollar would be worth about a nickel. What happened? Well, the government had created an institution called a central bank that was endowed with the power to create money. And create it did: so much so that it diminished the value of all existing currency.
