Dishonesty and Candor in Monetary Policy :: The Circle Bastiat

The origin of today’s monetary policy of course lies in Keynesian economics, and Keynes was quite explicit that monetary authorities should intentionally use deception as a primary tool. He spoke of the need to gull workers into thinking that wages were going up even if net of inflation they were going down. At least he had a sense of humor about it, calling a central bank a “green cheese factory” that would persuade the public to accept ” green cheese” ( newly created money) as the real thing.

The problem with the above statement, Keysian economics never contemplated long-term intervention in markets. The idea was that due to the hoarding of money during times of stress, that the government would unlock this hoarding and release it back to the markets by utilizing both monetary and fiscal tools to temporarily increase consumption. But, ultimately, private enterprise and free markets were expected to return to normal and allocate capital, resources and consumption goods effectively.

However, now, governments are continuously encouraged and expected to 'stimulate' and manage economies. They are not only involved in stimulating but also utopian wealth redistribution schemes. All of this has transformed into a massive central planning/socialist/Marxist experiment in direct contravention to the original concept of the nation of being a platform for the expression of individual rights.

The central planning intervention into the nations economic life will destroy innovation, American exceptionalism, traditional family life, and a host of other things that made this nation great. In return for giving all of this up, we will not have greater economic security but much much less. We will end of performing like Europe and at worst, like the moribund economies of the former Soviet Union, Communist China and a bunch of other failed economic experiments on a national level.

Dishonesty and Candor in Monetary Policy :: The Circle Bastiat