As I reported recently, banks are beginning to collaborate in the campaign by governments to stamp out the use of cash among the public. Chase, for example, rolled out a new program in several markets in March that restricts borrowers from using cash for making payments on credit cards, equity lines, mortgages and auto loans. Even more troubling is Chases’ revised policy governing the use of its safe deposit boxes.
A much-neglected book on the history of the state and its development is Hendryk Spruyt’sThe Sovereign State and Its Competitors. While many writers on the state have noted the coercive nature of states, few have taken the time to really explore the distinctions between the type of civil government known as “a state” and other types of civil government.
Lew Rockwell explains what to expect during this next election season. Hint: It’s like every other election season:
Students in the state’s official propaganda institutions learn about the wonders of the democratic process, so called, throughout their years of formal study. But the truth is on full display during a presidential election season. These are not wise statesmen, discussing matters of importance from a disinterested, platonic summit, but narcissistic power-seekers shoveling ill-gotten gains to favored constituencies.
Mises Fellow Louis Rouanet writes:
A. Intervention and Conflict
The first step in analyzing intervention is to contrast the direct effect on the utilities of the participants, with the effect of a free society. When people are free to act, they will always act in a way that they believe will maximize their utility, i.e., will raise them to the highest possible position on their value scale. Their utility ex ante will be maximized, provided we take care to interpret “utility” in an ordinal rather than a cardinal manner.
B. Democracy and the Voluntary
It might be objected that all these forms of intervention are really not coercive but “voluntary,” for in a democracy they are supported by the majority of the people. But this support is usually passive, resigned, and apathetic, rather than eager—whether the State is a democracy or not.7
C. Utility and Resistance to Invasion
To our comparative “welfare-economic” analysis of the free market and the State, it might be objected that when defense agencies restrain an invader from attacking someone’s property, they are benefiting the property owner at the expense of a loss of utility by the would-be invader. Since defense agencies enforce rights on the free market, does not the free market also involve a gain by some at the expense of the utility of others (even if these others are invaders)?
D. The Argument from Envy
Another objection holds that the free market does not really increase the utility of all individuals, because some may be so smitten with envy at the success of others that they really lose in utility as a result. We cannot, however, deal with hypothetical utilities divorced from concrete action.
E. Utility Ex Post
We have thus seen that individuals maximize their utility ex ante on the free market and that the direct result of an invasion is that the invader’s utility gains at the expense of a loss in utility by his victim. But what about utilities ex post? People may expect to benefit when they make a decision, but do they actually benefit from its results? The remainder of this volume will largely consist of analysis of what we may call the “indirect” consequences of the market or of intervention, supplementing the above direct analysis.
The Institute of Economic Affairs has published a useful review of Randy Holcombe’s recent book, An Advanced Introduction to the Austrian School of Economics. Reviewer Mikko Arevuo calls it “an erudite, accessible, and lucidly written introduction to the core principles, ideas and diversity of modern Austrian thinking.” Arevuo, who teaches management at Re
