Free Market

AIan Greenspan has received his foreordained reappointment as chairman of the Fed, to the smug satisfaction and contentment of the entire financial Establishment. For them, Greenspan's still in his heaven, and all's right with the world. No one seems to wonder at the mysterious process by which each succeeding Fed chairman instantly becomes universally revered and indispensable to the soundness of the dollar, to the banking and financial system, and to the prosperity of the economy.

Alan Greenspan has received his foreordained reappointment as chairman of the Fed, to the smug satisfaction and contentment of the entire financial Establishment.

For them, Greenspan's still in his heaven, and all's right with the world. No one seems to wonder at the mysterious process by which each succeeding Fed chairman instantly becomes universally revered and indispensable to the soundness of the dollar, to the banking and financial system, and to the prosperity of the economy.

Environmental activists have recently uncovered a plot to destroy The Planet. A foreign race has managed to infiltrate our most pristine spaces with a simple but devastating scheme: to stomp, chew, and defecate The Planet into oblivion. They are perhaps the least suspect of our fellow fauna. They are The Cows.

The debate over whether or to what extent we should bail out Gorby ($10 billion? $50 billion? $100 billion? Over how many years?) has almost universally been couched in false and misleading terms. The underlying concept seems to be that the United States government has, through some divine edict, become the wise and benign parent of Gorby/the Soviet Union, which, in its turn, has for most of its career been a wild and unruly kid, but a kid that is now maturing and showing signs of taking its place as a responsible member of the family.

Poor IBM. Apparently big isn't necessarily better in the relatively free computer market. How will IBM ever get the public to buy its fancy, expensive personal computers or pick its new operating system? How can IBM stop ACE?

Ludwig von Mises disliked hardboiled detective novels because he always knew who the murderer would be: not the butler, but a prosperous and respected gentleman of high social standing who pretends to virtue, but is actually a hidden criminal and sanctimonious hypocrite. Mises saw egalitarian envy in such tales. 

It's no different on television.

Governments have always intervened in the economy, but today's State—armed with modern data collection as well as an interventionist ideology—has taken us to a new level of regulation and taxation.

Few occurrences have been more dreaded and reviled in the 'history of economic thought than deflation. Even as perceptive a hardmoney theorist as Ricardo was unduly leery of deflation, and a positive phobia about falling prices has been central to both Keynesian and monetarist thought.

There has been a veritable revolution in the attitude of the nation's economists, as well as the public, toward our banking system. Ever since 1933, it was a stem dogma—a virtual article of faith—among economic textbooks, financial writers, and all establishment economists from Keynesians to Milton Friedman, that our commercial banking system was super-safe. Because of the wise establishment of the Federal Deposit Insurance Corporation in 1933, that dread scourge—the bank run—was a thing of the reactionary past.

In 1928 Herbert Hoover rode the coattails of Calvin Coolidge into the White House, and everyone thought he would hold the line on taxes, for he talked of "individual freedom" and criticized his opponents as "socialists."