Friday, July 9, 2010

An ode to austerity

Reprinted from

Governments in the U.S. (federal, state, & local municipalities) and across the Globe are awash with exploding deficits. The revived corpse of Keynesianism policies has been as successful as it was in the 1970s, which lead to "stagflation".

Other G20 nations (such as Greece) around the globe who have flirted with the flawed experiment are now pushing for cutting deficits and reducing spending.

Spending for the sake of spending does nothing for an economy. The only actors in an economy who know "how" and "where" to allocate scarce resources such as capital & investment (productive uses of spending) are free enterprises and free people who produce consumer goods and services other free people want and need.

The "State" on the other hand possesses neither the faculty or foresight to properly invest, calculate profit and loss, or add to the structure of production. All the state knows is power and control through its monopoly on coercion to take from one set of actors in society and transfer said resources to others.

Read the rest of the article here.

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