Mises Daily

It is the widespread view in academia that John Maynard Keynes was a model classical liberal in the tradition of Locke, Jefferson, and Tocqueville. But if Keynes was such a model champion of the free society, how can we account for his peculiar comments in 1933 endorsing the social "experiments" that were going on at the time in Italy, Germany, and Russia? And what about his strange introduction to the 1936 German translation of General Theory, where he writes that his approach to economic policy is much better suited to a totalitarian state such as that run by the Nazis?

While assorted financial journalists, market pundits, policy wonks, Fed governors and even mainstream macroeconomists have been thrown into a panic by the slight whiff of price deflation they detected in the last few months in the U.S. economy, they have almost completely ignored the wrenching confiscatory deflation that is now going on in Argentina

As the history of America's Great Depression is one long regret of political follies and blunders that aggravated the suffering, so is the story of the Japanese recession from the 1990s to the present.  The Japanese government tried to spend its way out of the recession, but instead merely prolonged it and created a mountain of debt.

During the early 1800s, the U.S. paper money in circulation was issued by banks, most of which were privately owned and state-chartered. There were, in fact, hundreds of banks across the country that issued their own--often distinctive--paper money. From these banking practices arose the infamous $3 bill. 

September 11 was far from the first time that the United States has been targeted by terrorists. In a 1997 report on the scourge of terrorism, the Pentagon's Defense Science Board observed: "Historical data show a strong correlation between U.S. involvement in international situations and an increase in terrorist attacks against the United States." Recognizing that fact is crucial to understanding why both terror and the response to terror have become such grave threats to freedom and prosperity.

Freedom needs no help from the state—which is its natural enemy, not its ally. Freedom promotes natural order, inequality, and the decentralization of enterprise, wealth, and culture.

Americans are discussing whether the president can just take on the powers of a Caesar, claiming more and more power because of the demands of war. But for those advocates of an imperial presidency, there are the words of Justice Davis: "No doctrine, involving more pernicious consequences was ever invented by the wit of man than that its provisions can be suspended during any of the great exigencies of government."

Professional victimologists see bad investors as victims of biased research. But they ignore the fact that smart investors have plenty of chances to avoid bad advice. What the losers from the Enron collapse got taken in by was the Fed-induced Bubble, not someone else's bad research. Those who would impose additional bureaucratic restrictions on Wall Street only penalize everyone to protect the gullible.

Far from an example of a market failure, Enron's saga shows that firms that invest too much in politics can easily become complacent in the face of changing market conditions.  In economics, this is called government failure, and we can blame the growing requirement for firms to divert resources to grease palms in Washington as a necessary business investment for its occurrence.

According to the popular view, the revival of some important economic indicators has raised the likelihood that the aggressive lowering of interest rates by the Fed will invigorate the economy. The irony is that the very same loose monetary policies that are expected to energize the economy in fact undermine its main source of strength.