Literature and Liberty: Essays in Libertarian Literary Criticism . By Allen Mendenhall. Lexington Books, 2014. 161 pages. Originally published at Libertarian Papers.

August 9, 2014 marks twenty-five years since the signing into law of the US savings and loan (S&L) industry bailout, the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) of 1989. After FIRREA was signed into law by President George H.W. Bush, the federal government took control of 327 failed S&Ls with $147 billion in assets.

Ninety-seven years ago, a small but ruthlessly determined band of revolutionaries set out to prove that it would be possible to achieve material happiness — and social justice — by replacing free markets with economic planning.

One often wonders whether differences in economic schools of thought are big enough to justify strict theoretical segregations. One such case is “marginal economics.” Most textbooks point to the triumvirate of Walras, Jevons, and Menger, who independently discovered the notion of marginal utility and its relevance to the pricing process. Quite often these brilliant thinkers are homogenized as more or less indistinguishable figures who paved the way for modern microeconomic theory.

Although libertarians and Austrian economists have been interested for a long time in the relationship between art and liberty, there’s been relatively little effort to develop a distinctly liberty- or market-oriented form of literary theory; critical theory is a playground for myriad “isms,” but libertarianism isn’t often counted among them. Fortunately, this situation is beginning to change, as there’s a lot of exciting work being done in the field of literary studies, which isn’t usually known for its sound economics or liberal political philosophy.

Guido Hülsmann writes:

In June, the European Central Bank (ECB) made a historic and downright diabolical announcement. They decided to inaugurate negative interest rates for overnight deposits. Here are the details from the official transcript:

The rate on the deposit facility was lowered by 10 basis points to -0.10 percent. These changes will come into effect on 11 June 2014. The negative rate will also apply to reserve holdings in excess of the minimum reserve requirements and certain other deposits held with the Eurosystem.

The US government’s decision to apply more sanctions on Russia is a grave mistake and will only escalate an already tense situation, ultimately harming the US economy itself. While the effect of sanctions on the dollar may not be appreciated in the short term, in the long run these sanctions are just another step toward the dollar’s eventual demise as the world’s reserve currency.

The use of the ceteris paribus, or “other things equal” assumption is an essential aspect of economic education. It is an important caveat that helps make sense of a complicated world by clarifying the incentive stories that comprise the core of economics.

Crony capitalism is everywhere around us. We are so used to it that we often don’t even notice it. Any time a privately-owned business uses its influence on government officials (e.g., friendship, money, or other favors) to shape government policies in its favor or to avoid the enforcement of the existing laws, we are faced with an example of crony capitalism. Crony capitalism reduces the accountability of politicians and businesspeople for their actions and it also infringes on the freedom of others to compete in the marketplace.