Running Out of Money?

    “You can never be too rich or too thin” (or something like that) said, uh, somebody or other . . . maybe — it’s attributed to a bunch of people few members of the public today ever heard of.  Leaving aside the “too thin” bit as a bit beyond our competence, we’ll focus on whether you can be “too rich.”  Quick answer: yes, you can be too rich, especially if no one else has any money . . . money here defined as “all things transferred in commerce.”  (That’s in Black’s Law Dictionary, at least the edition we have.)

Egocentrism, Tariffs, and the Single Tax, Part II

Last week we looked at how a distorted idea of one’s own importance can lead to treating anyone who opposes you as an enemy to be eliminated, and supporters as tools to be discarded once their utility is over.  This week we look at the implications of the Ricardian (as opposed to the Smithian) Labor Theory of Value.

Scrooge and the Virtue of Being Rich, Part III

Continuing our Scrooge Saga, in last week’s posting we asked the eternal question, “How did being wealthy become a virtue?”  The quick answer is that people’s understanding of money changed.  The longer and more involved answer is that people’s understanding of money, credit, banking, and finance changed . . . or, briefly, people’s understanding of money changed . . .

Central Banking, III: The Role of a Central Bank

Despite all the conspiracy theories floating around, central banking is essential in a modern technologically and economically advanced economy.  Allowing government to fill the role of a central bank is a serious mistake on so many levels that we won’t get into it.  We’ll focus instead on the mechanics.  So, what is a central bank all about?

Why Binary Economics?

Today’s blog posting is a selection from the book, Economic Personalism, which you can get free from the CESJ website, or from Amazon or Barnes and Noble.

In all forms of tyranny, the State or community dictates what people must do and how they must do it instead of maintaining the pólis so that people can pursue their own destinies within established parameters as they themselves see fit. When most people lack private property in capital and thus lack power, however, they often have no choice but to comply with the wishes of those who do have property, whether they are a private sector capitalist élite or a socialist bureaucracy.

A Modest Meditation on Money

The other day we came across an article in Catholic World Report all about how we shouldn’t make a false god out of money, etc., so on, so forth.  Nothing to see here, move one, yaddah, yaddah.  No, this isn’t a lecture on Catholic or even religious views of money, other than to agree with St. Paul when he reminded Timothy that love of money is the root of all evil.  You can probably find the same thing expressed by most other faiths and philosophies in the world, so it’s not particularly Christian; it’s human.

A New Monetary Philosophy

We closed the previous posting on this subject by wondering why, when the history of backing a financial asset with government debt had proved so disastrous in the South Sea Bubble and the Mississippi Scheme (which we didn’t go into), anyone would have been tempted to try it again.  After all, one definition of insanity is doing the same thing over and over and expecting different results — and the one thing Ebenezer Scrooge was not was crazy, either before or after his completion.

The Fatal Omission

As we saw in the previous posting on this subject, there was a movement in the early nineteenth century to broaden the base of capital ownership throughout society.   This was justified based on individual human dignity (Cobbett), economic stability (Morrison), and as a counter to the spread of the “New Things” of modernism and socialism (the Catholic Church).

The Church of Saint-Simon

In the previous posting on this subject — the “Democratic Religion” of Socialism — we saw that the ultimate goal of socialism was the complete overturn of traditional society and the implementation of what was usually called “the Kingdom of God on Earth,” a materialist terrestrial paradise.  This was usually put in economic terms, frequently confusing people as to what the goal really was.

The Formation of Capital

       In the previous posting on this subject, we looked at how financing new capital formation works with past savings and with future savings.  To recap, the past savings technique of finance means you accumulate savings by decreasing consumption in the past, while the future savings technique involves increasing production in the future.

Ricardo’s Detour

      No, we’re not talking about a Cuban band leader or even someone who plays one on television, even if we do love Lucy.  What we’re talking about today is the more-than-a-little-confusing way that the economist David Ricardo explained how to have your cake and eat it, too.

Investment v. Speculation

In the previous posting on this subject, we pointed out a few foibles of socialism, noting especially the idea that the only legitimate way to have an income is a wage system job, which over the past century or so has been gradually displaced by the idea that people should just get an income whether or not they have jobs.

Say’s Law and Money

In the previous posting on this subject we took a look at a fundamental error in Keynesian economics, in all of the schools of economics based on the Currency Principle, in fact.  That is the claim that production must exist before production can exist — the logical fallacy of reversing cause and effect, specifically, that you must refrain from consuming something before you can produce it.

Full Participation

Say’s Law of Markets is usually summarized as “Production equals income, therefore, supply generates its own demand, and demand, its own supply.  Unless, however, you understand or even are just generally familiar with the full explanation of Say’s Law, it’s likely that you will either misunderstand it or reject it outright.

The Expanded Ownership Revolution

One of the many paradoxes involved in the Great Reset and similar proposals has to do with human nature and the natural law.  As we saw in the previous posting on this subject, despite centuries of failure adherents insist that the abolition of private property and redistribution will work if we just manage to change human nature, try harder, and commit sufficient resources to the effort.

Binary Economic Personalism

It may have a somewhat lengthy name — the Just Third Way of Economic Personalism — but it is much more straightforward and logical than people living in a world soaked in Keynesian Kraziness might suppose.  In the previous posting on this subject, we noted how many (although not all) aspects of life are “binary” and tend either to be in balance or try to move toward a balance to function properly.  This, naturally enough, led us to economic personalism, which is based on an application of binary economics.

“Do We Agree?”

To answer that question briefly — and accurately — no, “we” don’t . . . if by “we” is meant G.K. Chesterton and G.B. Shaw.  The reference is to their final, er, “debate (for want of a better word) in November of 1927.

Getting Real About Money

As we saw in the previous posting on this subject, turning control of money and credit to the State does not seem to have been a good idea — ever.  In the crudest sense, it separates the people who produce from the benefits of production, mainly consumption.  This undermines the first principle of economics as stated by Adam Smith in The Wealth of Nations: “Consumption is the sole end and purpose of all production.”

The Economic Crimes of David Ricardo

As we closed the previous posting on this subject, we noted that David Ricardo “corrected” Adam Smith by declaring that labor alone is productive and gives value to something.  Things are not to be valued for their utility to the consumer, but in terms of what it cost in labor to produce it.

On Utility

As we saw in the previous posting on this subject, it is not enough, even in materialist terms, just to see that people have enough to ensure their material wellbeing.  Human beings also want to be useful and productive.