When the original 1980 Free To Choose was aired, inflation was starting to make life tough in the U.S. We were in the waning days of the Carter era. And the economy wasn't looking so good. It's interesting that Friedman was able to augur a long era of relatively low inflation in the U.S.
That said, a lot of people are under the impression that Friedman was perfectly happy with the Federal Reserve System we have today. But it's better to say that Milton was a pragmatist on such matters. As with many other issues, Friedman understood that well entrenched systems don't just get trashed with a penstroke. One might say Friedman was an early, pragmatic inflation Hawk.
Be afraid. Be very afraid. Because you see, another financial crisis looms. Just as there were millions of people given mortgages they couldn't afford, a million graduates are about to discover they have a useless degree they couldn't afford. And why? Because the federal government subsidizes student loans. And debt is for tomorrow. What is worse...
The international banking system is set up to benefit private interests, but when those interests fail, they socialize the losses in the form of bailouts -- bankrolled, as it were, by taxpayers. The Europeans are getting hosed right now. (Watch the Irish reporter in the video above.)
Because these private interests are so big and so powerful, they can always argue that their failure will cause economic catastrophe. But the socialization of losses will eventually cause catastrophe, too. In fact, we're now seeing Europe -- starting with Greece -- teeter at the precipice. So where does that leave us?
Socialism for everyone! Andrew Klaven does a great job of blending humor and truth. He lays it out in about 5 minutes. And that's the key to great memetics.
What's also great about this video is how effectively Klaven communicates the message: These are two factions who depend on a large-but-shrinking constituency of working people -- i.e. you and me. Their differences are only differences of degree. What they expect (and often get) is not only wrong in principle, but destructive. Both represent the causes of our economic problems.
I'm excited about how the idea of crony capitalism is really starting to get into the public consciousness now. The trouble is, so many in the public have become dependents themselves.
Even if you don't agree with everything Niall Ferguson has to say, you have to respect him. Interestingly, he's identified an overall policy contradiction that will require resolution sooner or later.
On the one hand you have a regulatory approach that seeks to re-capitalize and tighten up large lending institutions. On the other hand, you have a macroeconomic stimulus approach that requires more of the same kind of lending that creates bubbles and/or seeks to 'get the economy moving' as macroeconomists are fond of saying.
How do you explain to people that recessions are good for us? Johan Norberg says, we have gone on too long confusing the symptoms with the pathology. Actually, he uses the metaphor of the alcohol abuser, so let's stick to that. Because if he's right, that means politicians and central banks are keeping us in perpetual party mode.
James Delingpole is the man the climate-industrial complex loves to hate. I ran into him at a conference in Dallas. He gave me a galley copy of his book Watermelons. I read it from cover to cover and enjoyed every minute of it. Delingpole has put together a damning case against the green movement.
I just finished reading Tyler Cowen's The Great Stagnation. I know. I'm late to the party. If you haven't read it, you should. You can get it on your Kindle for about $4.00. The basic idea is that since about 1970, Median GDP per capita has leveled off. There have been other gains to be sure. But overall, thinks Cowen, the "low-hanging fruit" of growth has tapered off and there seems to be diminishing returns for innovation -- at least in terms of life-expectancy and prosperity. Much of any growth gains have been gobbled up by our third-party payer healthcare system and by our woeful education system, (the latter which is oversubsidized at the high end and socialized at the primary and secondary level). These are big factors to be sure.
But I wonder: isn't it funny that we severed the dollar's ties with the gold standard in 1970?
