What with Hurricane Dorian tearing up the Islands and the East Coast, and Keynesian economics tearing up the world economy, not to mention the economic antics of China that is increasingly relying on expanding its bubble economy at everyone else’s expense, it’s easy to overlook what else is going on:
|Carrie Lam to Slaughter|
• Hong Kong Withdraws Extradition Bill. Carrie Lam, head of the Hong Kong government (such as it is) has withdrawn the extradition bill that started the current round of protests. Given the length of time it took to do so, it is hardly likely that meeting the original demand will end the protests. Had the bill been withdrawn at the beginning, it probably would have, but the overreaction from the Party and the beatings and arrests have virtually ensured that it is no longer enough. The government may find that they have let the genie out of the bottle and people will start demanding freedom, democracy, and economic justice. After all, if Hong Kong reformed its “Monetary Authority” (the de facto central bank) to provide a stable, elastic, asset-backed reserve currency, there would be nothing to prevent Hong Kong from becoming the hub of a transpacific economic region that would leave traditional economic thinking in the dust.
• Hong Kong Government Anxious? This morning the Hong Kong government took out a full-page ad in the Washington Post and probably other liberal-leaning newspapers reassuring the American public that it is committed to peaceful coexistence and the One-China-Two-Systems policy. Reading between the lines, the implication is that all the violence has been the fault of the protestors, who evidently disguised themselves as police and began shooting tear gas grenades and plastic bullets at themselves and bystanders, as well as nurses trying to help the injured.
|Rebuilding Puerto Rico might be more important than the Wall|
• Puerto Rico Recovery Financing. Illustrating the problems associated with using outdated assumptions about money and development to guide thinking, Puerto Rico’s recovery is being put on a back burner due to funds being diverted to the wall to keep out illegal immigrants. This is a triple tragedy, because, one, Puerto Rico occupies a position that gives it ready access to North, Central, and South America, and it could easily become a financial and economic hub of two continents. Two, development and recovery can be financed with the expansion of bank credit in ways that creates new owners instead of being a cash drain on existing money. Three, by showing how to revive an economy in a way that benefits everyone, Puerto Rico could lead the way and make staying in your own country far more attractive than making a dangerous trip to the United States.
|Concentrating wealth even more.|
• Concentrating Ownership Further. Companies like Disney, Apple, and Deere and Co. are financing expansion with cheap capital credit. This, of course, ensures that ownership of these and other companies using the same financing technique will become even more concentrated than before. Of course, if they wanted to make certain they had a customer base in the future to purchase their products, they would finance by issuing new shares, and pay out all earnings as dividends. New shareholders could then have shares that paid for themselves with future dividends and thereafter yield consumption income.
|Msgr. Ryan: Fascist, Socialist, Modernist|
• U.S. Bishops Statement on Ownership. In commemoration of the 1919 U.S. Bishops program for social reconstruction, the United States Conference of Catholic Bishops issued a statement on Labor Day that mentioned ownership in a positive manner, notably ESOPs. While this is a nod in the right direction, neglected was any mention of the qualifications and cautious nature of the rather mild endorsement in the 1919 program as well as the 1986 Pastoral Letter on the Economy, Economic Justice for All. Of the 1919 program, Dr. Franz Mueller, a student of Fr. Heinrich Pesch, S.J., had this to say: “It is hard to understand why neither [Monsignor John A.] Ryan nor the Catholic War Council realized, or so it seems, the ‘corporatist’ [i.e., Fascist] implications of this statement.” (Franz H. Mueller, The Church and the Social Question. Washington, DC: American Enterprise Institute for Policy Research, 1984, 107.) Expanded ownership is all very well, and a desirable goal, but not if ownership is redefined in such a way as to turn it into de facto socialism. As Mueller noted, Ryan trivialized concerns about his program that the bishops adopted by sneering that anyone who questioned him was not worthy even to be spoken to. (Ibid., 106.)
|Boris "Brexit Now" Johnson|
• More Brexit Bumps. Boris Johnson, the new British Prime Minister, has to all appearances overplayed his hand in pushing for a “deal-no-deal” exit of Great Britain from the European Union, and is calling variously for the Queen to prorogue (delay . . . sort of) Parliament and early elections, anything that he thinks will get Great Britain definitely out. Meanwhile, the rest of the Union is having trouble holding things together. In this writer’s opinion, much of the trouble can be put at the door of bad monetary and economic policy. The Euro is the first widely used currency to be based from the beginning on pure Keynesian/Modern Monetary Theory principles, which means that the State has sole power to create money (as opposed to the essential regulation thereof). This means that the money supply is tied to government policy, not the needs of the economy. As a result, economic policy and money creation is determined by how much the politicians can get away with spending instead of helping people to become productive. Thus, instead of finding ways for people to own capital and produce with both labor and capital, whichever is better in a particular situation, the goal is to find ways to get people to consume without necessarily producing anything. It becomes easy to understand why Great Britain would want out . . . and at the same time why it would be disastrous if they do. What the EU needs is something along the lines of a Capital Homesteading program to implement economic personalism.
|Keynes: Hide problems, don't solve them.|
• Anti-Recession Pre-Emptive Strike. After jumping up and down for weeks declaring that everyone should remain calm and there is no reason to worry and that there is absolutely, positively no danger in any way, shape, or form of a(nother) recession and it is unnecessary to take any action at all, the pundits are now saying that there is absolutely, positively no danger in any way, shape, or form of a(nother) recession . . . but that it may be necessary to take pre-emptive measures in order to ensure that there will not be a(nother) recession. Of course, if they realized that we are still firmly ensconced in the “boom or bust” cycle that necessarily accompanies tying government and economic policy to the Currency Principle (viz., the amount of money determines economic growth or lack thereof) instead of the Banking Principle (viz., the level of economic activity determines the amount of money), and that only massive currency manipulation by governments have masked this, they could stop the insanity with some relatively straightforward reforms as outlined in the Capital Homesteading proposal that applies economic personalism. The problem then, of course, would be finding bad news for the pundits to deny. . . .
|Look, Alice, a cat with a grin!|
• Shop online and support CESJ’s work! Did you know that by making your purchases through the Amazon Smile program, Amazon will make a contribution to CESJ? Here’s how: First, go to https://smile.amazon.com/. Next, sign in to your Amazon account. (If you don’t have an account with Amazon, you can create one by clicking on the tiny little link below the “Sign in using our secure server” button.) Once you have signed into your account, you need to select CESJ as your charity — and you have to be careful to do it exactly this way: in the space provided for “Or select your own charitable organization” type “Center for Economic and Social Justice Arlington.” If you type anything else, you will either get no results or more than you want to sift through. Once you’ve typed (or copied and pasted) “Center for Economic and Social Justice Arlington” into the space provided, hit “Select” — and you will be taken to the Amazon shopping site, all ready to go.
• Blog Readership. We have had visitors from 35 different countries and 42 states and provinces in the United States and Canada to this blog over the past week. Most visitors are from the United States, India, Rwanda, Spain, and Australia. The most popular postings this past week in descending order were “The Modernist Monsignor,” “A CPA’s Perspective on Pope Francis,” “News from the Network, Vol. 12, No. 35.” “Democracy in America,” and “The Purpose of Production.”
Those are the happenings for this week, at least those that we know about. If you have an accomplishment that you think should be listed, send us a note about it at mgreaney [at] cesj [dot] org, and we’ll see that it gets into the next “issue.” Due to imprudent language on the part of some commentators, we removed temptation and disabled comments.