The following excerpt is taken from an article at the Ludwig von Mises Institute, and it is written by Robert P. Murphy. 

San Jose State economics professor Jeffrey Rogers Hummel tells all his students that the easiest way to understand the Federal Reserve is to think of it as a giant, legalized counterfeiter. I had always known that the Fed and other central banks were like counterfeiters, but I still thought that the actual mechanics of open-market operations and so forth actually provided some important distinctions.

In large part because of my frequent email exchanges with Hummel, I now realize that I was being naïve. Once you understand the details of modern central banking, you are able to step back and see that it truly is a way for the government to use the printing press to pay its bills. All of the complicated process of targeting interest rates through buying Treasuries simply hides this essential point — and perhaps deliberately so.

An Old-Fashioned Monarch With a Printing Press

Before we examine Fed operations, let's start with something simpler. Suppose there is a powerful monarch reigning over a large, industrialized country. The monarch has managed to wean his subjects off commodity money such as gold or silver, and instead they use fiat notes, rectangular slips of paper featuring the king's portrait. The king has a printing press at his disposal, which gives him unlimited ability to create more slips of paper with which he can buy goods throughout his kingdom.

At first, one might think that our hypothetical king has infinite wealth. But upon reflection, we see that there are actually pragmatic limits on how much new money he will print up each year. It's true that there are no legal constraints on how many notes he can create, but the more monetary inflation he sows, the greater the price inflation he will reap.

At some point, the monarch would actually make himself poorer in the long run by running the printing press too heavily in the present. For example, if he doubled the stock of money in one year, the resulting price inflation would destabilize his economy and cause much needless capital consumption. His subjects would be less willing to invest in their businesses and retirement portfolios, knowing that he might effectively confiscate their savings again through massive creation of new money. Foreign investors too would be wary of exposing themselves to his country if he made his fiat currency too volatile.

Because of these considerations, the monarch would no doubt run off new money every year from his printing press, but he wouldn't overdo it. He would aim for a moderate level of constant price inflation, with the purchasing power of his fiat currency slowly falling over time in a predictable manner. Each year, the new influx of money into the economy would represent a transfer of wealth from all other currency holders into the king's possession.

Now what if our monarch is really profligate? What if he wants to spend more money than the income and tribute he earns in his position as monarch, even including the amount of new money he dares to create each year with his printing press, can support? In this case, the monarch can still resort to old-fashioned borrowing. Therefore in any given year, the monarch can only spend what he collects in tribute (taxes), debt financing, and inflation.

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WASHINGTON - Libertarian Party (LP) Chairman William Redpath issued the following statement today in response to President Barack Obama's State of the Union address:

"Tonight's speech was a reminder that, for decades, the policies of Republicans and Democrats alike have failed. Libertarians are asking people to take matters into their own hands. Instead of just complaining, we're encouraging ordinary Americans to step up and run for Congress on the Libertarian Party ballot line.

"I can say exactly the same thing about President Obama's speech tonight that I said about George W. Bush's State of the Union speech in January 2008: 'Tonight's State of the Union address went much as expected. Instead of calling for a more limited role of the federal government in American society, the President laid out plans that would only increase the government's intervention into the realm of economics, health care, education and foreign policy.'

"I am weary of the President's unspoken premise that only government--indeed, only the federal government--can accomplish good in our society.

"President Obama seems to be totally blind to the concept that government can cause problems rather than solve them. His speech was filled with 'More': more handouts, more spending, more programs, more bailouts, more regulations. We Libertarians want less government, not more.

"Not to be outmatched by the Democrats, the Republican Party conveyed its lack of seriousness in addressing this nation's government spending problems by having Bob McDonnell, Virginia Governor for eleven (11) days, deliver its rebuttal to the President. If they were really serious about addressing the dire fiscal circumstances of this nation, they would have had Paul Ryan, a six-term congressman from Wisconsin, who has proposed the most serious plan of anyone in the two older parties to keep us from going off a fiscal cliff.

"Last week, Alan Auerbach, Professor of Economics and Law at UC Berkeley and US government fiscal policy expert, said that the Democratic and Republican parties are in a 'death embrace' with their government spending. The only political party that is rationally and forthrightly addressing the need to cut government spending and end our culture of ever expanding entitlements is the Libertarian Party.

"As Americans lose hope in Obama, we Libertarians are warning voters against running back to the Republicans who got us into such big messes in the first place. Republicans started the wars in Iraq and Afghanistan. Republicans made the false intellectual case for bailing out banks and car companies. Republicans argued that deficits don't matter. Republicans gave us the giant Medicare expansion bill.

"The President's suggestion of a 'spending freeze' was especially ludicrous and insulting to the intelligence of Americans. The amounts involved are minuscule, and Congress won't accept them anyway. Will Obama sign the spending bills that ignore his 'freeze'? You bet he will. Instead, the President should demand across-the-board cuts in all areas, including entitlements.

"The President talked a lot about jobs. Unfortunately, the policies he supports are responsible for most of the unemployment we see today. High taxes, minimum wage laws, hiring regulations, firing regulations, mandatory unemployment benefits, and other government interference make it much more difficult for businesses to hire and keep employees. As expected, the President's prescription is to increase the dosage of this government poison.

"While our nation is declining dangerously right now, a turnaround could be straightforward and simple with steps like these: 1. Bring our troops home from Iraq and Afghanistan; 2. Stop rewarding failed companies with bailouts; 3. Cut taxes and spending and let the free market work.

"Finally, on the matter of political rhetoric, I call upon the two older parties to stop spoon feeding politics to the American people as if we are a bunch of overgrown children. These are difficult times that call for more than rhetorical flourish or positioning a group of diverse people around a politician. Older party politicians need to be specific about their proposed policies, as Libertarians are.

"And, I know I'm probably just wasting electrons, but can't we go back to the days in which the President sent a copy of his speech to Congress and left it at that. The speech last night took 1/7000th of an entire year. I think the vast majority of the American people would agree that we have better ways to spend our time."


William Redpath has served as the Chairman of the Libertarian Party since 2006.

For more information, or to arrange an interview, call LP Executive Director Wes Benedict at 202-333-0008 ext. 222.

I would like to offer the following as a philosophical perspective of my own design. What will ensue will be my own interpretive phraseology, but I am confident that I will be able to purvey an accurate juxtapositional argument and insure its fidelity.

 If one can fabricate a peripheral examination of Obama’s current administration, as well as the ideological polity which comprises his community subsidiaries – one will begin to observe the technocracy which drives all of their political movements. Technocracy can be defined as;

"...a government or social system controlled by technicians, especially scientists and technical experts."

Technocrats are political and officiating determinants that are chosen for their degree of knowledge, rather than their grade of political capital. By virtue of their academic and intellectual sophistication within their correlative fields, it grants them an uniquely esoteric perspective on societal constructs, as well as their connected corollaries. Remedies will be conceptualized and technology-focused solutions will be utilized to achieve a specified result. But do not transfix yourself to one, or even a few classifications of technology, for a technocrat’s machinations are many. This will be explicated further on.

The danger lies in their contention that the commonality of your average citizen is too pedestrian to cognate their vision for required social change. Therefore, our stasis through ignorance grants them the authorization to intercede and subsequently nullify the average citizen’s firmness of purpose. Our inability to determine correct action sanctions the technocrat’s superior decision making skill set, thereby “nudging” us onto the appropriate path. Seat belt laws and helmets for motorcycle riders are just two examples where technocracy effected governmental interference. Here is another example by Virginia Postrel;

 “Technocracy declares that if automobile air bags are a good idea for some people, they must be required for everyone. If they turn out to injure children and small adults, planners may make an exception, but only if given a ‘good reason’.”

What we have here is ideological technocracy faceted with paternalism, and it utilizes the political tools of legislation and regulation in order to manifest social efficacy. Dynamical systems such as psychodynamics are also employed to create predictive indicators which will then be used to "adjust" the direction of our societal machine. Making long term predictions are futile and impossible by nature, but anticipatory measures can be implemented as a means to control the evolutionary state of society. For example, look at the viewpoints from Science Czar John Holdren and Regulatory Czar Cass Sunstein;

Holdren: "People who “contribute to social deterioration” (i.e. undesirables) “can be required by law to exercise reproductive responsibility” -- in other words, be compelled to have abortions or be sterilized."

Sunstein: "Known for advancing a field called "law and behavioral economics" that seeks to shape law and policy around the way research shows people actually behave..."            

Similarly, the Democrats declined the opportunity for the free market to correct itself, instead they opted for the style of technocratic management to reform our economic system. They stated that they could not rely upon the uncontrolled impulses of an externalized equilibrium (laissez faire) for our economy, instead they preferred to inject Keynesian stupidity. They vehemently stated that without TARP and stimulus funds being made available corrections could not be made like stifling unemployment. And how effective have they been? Not very, unemployment is rising and the Obama administration continues to lie about the number of saved and or newly created jobs. As for the rest of the economy, they are currently spending our Republic into oblivion. 

It is this sort of hubris that fuels ideological technocracy; thinking you know what's best for society under some deluded view of being intellectually superior and fixating upon some pseudo-idea that society's evolution can be managed by prevenient measures and legislating human nature. If the plebeian masses will not change on their own accord, they will be forced to do so. This brings to mind a German phrase that is synonymous with the Democratic party;

"Gemeinnutz geht vor Eigennutz" - "The common good goes before the interest of the individual."    

The following are just two examples of well known technocrats that influence governmental coercion, and who, by any standard, are Constitutionally illiterate. There is an interrelation between these individuals and it revolves around the fabrication of micro systems which are designed to dissolve and reconstitute the narrative of “American Life.” Due to the inadequacy of our choices intellectual elitists have interjected their superior stream of consciousness to artificially force a corrected behavior pattern. Would you want these men dictating your life?

I obtained most of this information from Constitutional Watchdog.

Science Czar John Holdren

In a book Holder co-authored in 1977, the man now firmly in control of science policy in this country wrote that:

• Women could be forced to abort their pregnancies, whether they wanted to or not.
• The population at large could be sterilized by infertility drugs intentionally put into the nation’s drinking water or in food.
• Single mothers and teen mothers should have their babies seized from them against their will and given away to other couples to raise.
• People who “contribute to social deterioration” (i.e. undesirables) “can be required by law to exercise reproductive responsibility” -- in other words, be compelled to have abortions or be sterilized.
• A transnational “Planetary Regime” should assume control of the global economy and also dictate the most intimate details of Americans’ lives -- using an armed international police force.

Regulatory Czar Cass R. Sunstein

Title: Administrator of the White House Office of Information and Regulatory Affairs
Salary: unknown
Reports to: Office of Management and Budget head Peter Orszag
Appointed: January 2009
Nomination was sent to Senate on April 20, 2009 - no action yet taken
Agency that might have handled similar issues: OMB

• Will be responsible for reviewing draft regulations and assessing their costs and benefits.
• Is a Harvard Law School professor; prior to that, was a professor at the Univ. of Chicago Law School (1981-2008).
• Academic specialties: constitutional law, administrative law, and regulatory policy.
• Known for advancing a field called "law and behavioral economics" that seeks to shape law and policy around the way research shows people actually behave; though embraced by conservatives, critics say it fails to account for the sometimes less-than-rational aspects of human behavior.
• In his 2002 book, Republic.com, discussed the drawbacks of limitless choices on the Internet that allow people to seek out only like-minded people and opinions that merely fortify their own views; he talked about the idea of the government requiring sites to link to opposing views. He later came to realize it was a "bad idea."
• In his 2004 book, Animal Rights, suggested that animals ought to be able to bring suit, with private citizens acting as their representatives, to ensure that animals are not treated in a way that violates current law.
• In a 2007 speech at Harvard he called for banning hunting in the U.S..

♦

My goal here is not to malign or construct an indictment of technological advancement, but merely to illustrate that the existence of ideology within the field creates a perversion. The aforesaid individuals care little for individual liberty or the principles of our Founding Fathers, both are viewed as antiquated fundamentalism that precludes the progression of a liberal state. They fail to make the connection that liberty and the improvement of our civilization do not have to be mutually exclusive, for in fact, they are symbiotic. In part 2 I will propose one final argument and hopefully tie everything together.  

Milton Friedman and the Human Good

Charters of Freedom

Study Guide

The following was taken from the Cato Institute's Cato Handbook for Policymakers. 

Congress should
● live up to its constitutional obligations and cease the practice
of delegating legislative powers to administrative agencies—
legislation should be passed by Congress, not by unelected
administration officials;
● before voting on any proposed act, ask whether that exercise
of power is authorized by the Constitution, which enumerates
the powers of Congress;
● exercise its constitutional authority to approve only those
appointees to federal judgeships who will take seriously the
constitutional limitations on the powers of both the states and
the federal government; and
● pass and send to the states for their approval a constitutional
amendment limiting senators to two terms in office and representatives
to three terms, in order to return the legislature to
citizen legislators.

"...The American Founders did not pluck those truths out of thin air, nor did they simply invent the principles of American government. They drew from their knowledge of thousands of years of human history, during which many peoples struggled for liberty and limited government. There were both defeats and victories along the way. The results were distilled in the founding documents of the American experiment in limited government: the Declaration of Independence, the Articles of Confederation, the state constitutions, and the Constitution of the United States. The American Founders were careful students of history. It was Thomas Jefferson, in his influential A Summary View of the Rights of British America, prepared in 1774, who noted that ‘‘history has informed us that bodies of men as well as individuals are susceptible of the spirit of tyranny.’’ Another Founder, Patrick Henry, devoted great attention to the
study of history. He summed up the importance of history thus: ‘‘I have but one lamp by which my feet are guided, and that is the lamp of experience. I know of no way of judging the future but by the past.’’ History—the lamp of experience—is indispensable to understanding and defending the liberty of the individual under constitutionally limited, representative government."

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Prudence ... will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.