A familiar question in a standard microeconomics graduate seminar goes something like this: a Pigouvian tax is not market distorting. True or false?
The expected answer: true.
True?
Any fiscal intervention being definitionally a distortion of how a given market would otherwise operate, how can this be?
Spoiler alert: it boils down to little more than academic charlatanry.
The economy consists of a huge chain of the division of labor that is interlocked to such a limit where there exists hardly any single individual or firm that produces the whole of the product alone. This is famously illustrated in the essay “I, Pencil,” by Leonard Read.
It seems a short leap from Robinhood or Coinbase to a Ponzi scheme. “Investing is simple here,” Robinhood’s website leads. “Start building your portfolio with just $1.” Scroll down a bit on coinbase.com, and it says, “Take control of your money.” Charles Ponzi himself, called “a wizard of finance” in 1920, was “the discoverer of wealth and happiness.” Common folk cheered the dapper five-foot, two-inch Italian while lining up, desperate to hand Ponzi their savings and earn a 50 percent return in forty-five days.
It has become trite for American fiction writers to lambast capitalism and the free market system as inherently immoral. Because few have entered the fray to counter these spurious notions, progressives dominate fiction, allowing them to mold the cultural milieu into one that is increasingly statist. Of the few in fiction who do defend liberty, Ayn Rand is perhaps the most prominent.
With the acknowledged national debt now a politically and economically unpayable $30 trillion (in reality, its unfunded liabilities are far greater), Americans should start to become acclimated to the realities of the United States’ eventual, inevitable default.
In a recent speech regarding budgetary measures for 2022–23, the Mauritian minister of finance, economic planning and development, Renganaden Padayachy, pledged to continue the efforts to decolonize the Chagos Archipelago. For nigh on fifty-seven years, this issue has been buried under the rigmarole and casuistry of both Washington and Westminster.
“Democracy is under attack!” I wish I had a fiat nickel for every time I heard some variation of this panic-line these past half-dozen years.
Trump will destroy our democracy!
Our sacred democracy is under assault!
Mostly peaceful protesters are in the streets trying to protect our besieged democracy!
Rioters stormed the Capitol to take down our democracy!
We must have more democratic process in boardrooms—for Diversity, Inclusion, and Equity (DIE)!
The Right to Bear Arms
by Stephen P. Halbrook
New York: Post Hill Press, 2021, 348 pp.
Audrey Kline (audrey.kline@louisville.edu) is associate professor of economics at the University of Louisville.
