On April 19, 2022, at the Economic Club in New York, the Chicago Federal Reserve Bank president Charles Evans said the Fed is likely to lift by year end its federal funds rate target range close to the neutral range of between 2.25 to 2.50 percent. Furthermore, on April 21, 2022, Fed chairman Jerome Powell corroborated this by stating that the Fed wants to raise its benchmark rate to the neutral level.

“Fascist” these days is little more than a term of abuse for opponents and has no cognitive value, but in what follows I’ll be using it in a precise sense, to designate a supporter of the regime established by Benito Mussolini in Italy. Was Ludwig von Mises in this sense a Fascist or a Fascist sympathizer? The question on its face seems absurd, and so indeed I shall be arguing it is; Mises was a defender of the free market, liberty, and peaceful international relations, in contrast to the state-controlled economy and violence of the Italian dictator.

Since 2008, a key component of Fed policy has been to buy up mortgage-based securities and government debt so as to both prop up asset prices and increase the money supply. Over this time, the Fed has bought nearly $9 trillion in assets, thus augmenting demand and increasing prices for both government bonds and housing assets. Moreover, these purchases were made with newly created money, contributing greatly to liquidity and the easy-money policies that have prevailed since 2009.

Dealing with specific geopolitical circumstances can be messy. We may disagree on the facts and on which sources are reliable, making it hard to make any headway in a discussion. This may be further compounded by extreme emotions we may have about that situation. The advantage of purely theoretical inquiry is that we can stipulate the facts so as to make the analysis as simple as possible, and avoid much of the emotional baggage that stymies understanding.

I recently wrote a piece explaining that there is a libertarian case for taking away Disney’s Florida privileges. However, I am writing this to stress that while strategically that is the appropriate approach, we must not throw out the baby with the bathwater.

A standard trope in socialist circles is that the poor and downtrodden refuse to vote their economic interests. See, e.g., Thomas’s Frank’s “What’s the Matter with Kansas? How Conservatives Won the Heart of America. This theory is used to justify various anti-democratic schemes to “protect” the vulnerable from themselves. If, after all, the poor aren’t voting their interests, then why can’t we achieve Pareto-optimal interventions on their behalf? 

The global monetary system is facing historic challenges.