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(Mises)—Most economic analysts predict that the US is about to enter into a cyclical recession. Even Austrian School economists (like me) agree. The big question is, “What will government do?” Will it finally stop its fruitless interventions, such as trying to drive down the interest rate via inflation in the face of unprecedented budget deficits?
Look to Past Actions
Tom Fitton, CEO of Judicial Watch, answered this question (regarding another matter) during a Q&A session at the annual banquet of the Conservative Caucus of Delaware. His answer was simplicity itself and should have been obvious to us all. He said that if we want to predict what a person will do, just look at what he did previously under similar circumstances. People really don’t change much. In fact, regarding economic philosophy, my experience has been that it is very, very difficult to entice someone even to consider an alternative.
That is why the Fed has been itching to find any reason whatsoever to lower interest rates. A few weeks ago, the Fed convinced itself and its Keynesian admirers that price inflation had moderated to below its arbitrary target of two percent, which it felt justified lowering the Fed Funds rate by a half a percentage point. Of course, attempting to goose the economy before an election had nothing to do with it. Oh, no. And if you believe this, I have a bridge in Brooklyn I’ll sell you…cheap!
Why Don’t People Change?
A bigger question arises: why continue to do the same thing that caused all the trouble in the first place? Don’t people learn? Don’t they take a good hard look at the never-ending booms and busts and ask themselves why this keeps happening? That answer is more difficult, but I believe it has to do with human nature. No one ever wants to admit that he might be wrong.
All the governments of the Western bloc are wedded to Keynesian economics that itself is rooted in the Great Depression of the 1930’s. Against all evidence and completely ignoring Say’s Law of Markets, in his magnum opus The General Theory of Employment, Interest, and Money, John Maynard Keynes posited that overproduction had caused an unstoppable deflationary price spiral and that the solution was to increase aggregate demand through government spending. This was a godsend to free-spending politicians, who previously had been encouraged—correctly, by the way—to cut government spending in the face of a recession in order to free capital to revive the wealth-generating private sector. The evidence of the rightness of this policy, in addition to its logical correctness, was the post-World War I Wilson-Harding depression that was over in about a year and a half. The government actually cut spending in order to wash out capital-consuming parasites that always emerge during war economies. Mark Thornton has this statement in his 2018 book The Skyscraper Curse: And How Austrian Economists Predicted Every Major Economic Crises of the Last Century:
The alternative approach to business cycle contractions is espoused by the classical economists, the Austrian-school economists, and the real business cycle theorists. This “do nothing” approach involves shrinking government and balancing the budget, expanding resources in the private sector, and a nonexpansionary monetary policy. This was employed by Presidents Woodrow Wilson and Warren G. Harding during the fifteen-month-long depression of 1920–21. This period was one of the most severely deflationary in US history, and yet it is hardly mentioned in history textbooks.
But no one, especially those in government and their politically-connected cronies, will entertain the idea of sound money and reduced government spending today. Oh, no! We are living in the age of “countercyclical spending” in which the cart goes before the horse. In fact, our economic system is full of mandatory spending in the face of recession. All manner of welfare programs have been passed to protect workers and businesses from being forced to adjust to the realities of the market. For example, politicians are lauded for extending unemployment benefits beyond previously-established maximums. But here’s the rub—the economy cannot recover unless people and businesses are willing to change. Working in industries that the market desires at a price the market is willing to pay is the only path to economic recovery. Not working at all and refusing to change business models perpetuates and deepens the recession.
Conclusion
So, what is the answer? It is obvious. The people who have been given the power to enact Keynesian policy must be removed from positions of power. They are not going to change. They and their Keynesian policies must be sent to the dustbin of history. It will not be easy. But it’s either adapt to new market realities or suffer an economic collapse unprecedented in US history.
Mysterious “Skyquakes” Are Causing Strange “Booms” in the Sky, and Scientists Have No Explanation
by Michael Snyder
(End of the American Dream)—What is causing the extremely loud “booms” that people are hearing in the sky all over the world? We are being told that “skyquakes” are responsible, but scientists have no idea why these “skyquakes” are occurring. In some cases, the “skyquakes” cause such powerful shaking that…
The Biggest Sale on Long-Term Storage Beef EVER
by Sponsored Post
Let’s cut to the chase. Prepper All-Naturals is offering an unprecedented 40% off for it’s “Beef Steak” survival bags with promo code “steak40”. With a 25-year shelf life and a single ingredient (beef, of course), our most popular product is available for a very limited time with the biggest discount…
Seattle Is Ordered to Stop Blocking Illegal Alien Deportations in the Most Hilarious Court Decision Ever
by PJ Media
A federal court has just pooped in the oatmeal of the West Coast, Messed Coast™governors and local election officials suffering from acute cases of Trump Derangement Syndrome who think they can stop illegal alien deportations. And after this hilarious and thorough legal takedown from the 9th Circuit Court of Appeals,…
Illegal Alien Terror Suspect Found Dead in Cook County Jail Cell
by Slay News
An Islamic illegal alien has been found dead in his jail cell after being arrested on terrorism charges. According to CWBChicago, 22-year-old Sidi Mohamed Abdallahi was found dead at the Cook County jail in Illinois on Saturday. Abdallahi was arrested on felony terrorism and hate crime charges in October. He…
Trump’s Wild Bunch Is Ready for Action
by Frank Miele
If for no other reason than that it will elicit fear in the hearts of autocracy-phobics, I propose that Donald Trump’s second-term Cabinet be known as “The Wild Bunch.” The name is best known as the title of Sam Peckinpah’s classic 1969 western featuring a colorful cast of aging outlaws…
FAA Issues Flight Restrictions Over Questionable Drone Activity Near Trump’s Bedminster Golf Course
by Just The News
The Federal Aviation Administration (FAA) on Tuesday said that it has issued two flight restrictions on the area surrounding President-elect Donald Trump’s Bedminster golf club in New Jersey, following questionable drone activity. The drone sightings were first reported on Nov. 18, but have continued into this week, according to Fox…
Ex-FBI Agent Convicted for Stealing From Jan 6 Defendant During Raid
by Trending Politics
A former Houston-based FBI agent has been convicted of stealing valuables and cash while conducting searches. In one instance, the agent stole cash and silver bars from a non-violent January 6 defendant’s home. Nicholas Anthony Williams, 36, was indicted on January 31 in the Southern District of Texas. Williams, who…
Democrats, Media Elite Urge Biden to Pardon Trump’s Alleged ‘Enemies List’
by Breitbart
President Joe Biden should issue preemptive pardons to his political allies and those deemed to be on President-elect Donald Trump’s alleged “enemies list,” Democrats and their media allies believe. Delivering a preemptive pardon indicates an admission of guilt, although Democrats claim a preemptive pardon would only be intended to block…
Fani Willis Forced to Release All Communications With Jack Smith, J6 Committee
by Trending Politics
The Fulton County Superior Court has ruled against District Attorney Fani Willis, ordering her to disclose communications with Special Counsel Jack Smith and the House January 6 Committee. The decision, announced on Tuesday, follows a lawsuit brought by Judicial Watch, a conservative watchdog group, which accused Willis of violating Georgia’s…
Lindsey Graham Is the Warmongering NeoCon Leading the Charge to Upend Pete Hegseth
by JD Rucker
Pete Hegseth represents a shift away from the wokeness that has infected the United States military. This is possibly the biggest reason President-Elect Donald Trump tapped him to be the next Secretary of Defense and the vast majority of Republicans on Capitol Hill can support this, at least for the…
‘Where Are Black Democrats?’: Charles Payne Tells Personal Story to Call Out ‘Huge Double Standard’ of Biden Family
by Nicole Silverio, DCNF
(DCNF)—Fox Business host Charles Payne called out the alleged “huge double standard” of President Joe Biden’s family Tuesday by revealing that his brother, who struggles with a crack addiction, is currently serving a jail sentence. Payne said his brother, who is getting out of jail on Friday, is likely one…
Zelensky Admits Ukraine Can’t Retake All Its Land: ‘We Must Seek Diplomatic Means’
by Breitbart
Ukrainian President Volodymyr Zelensky conceded in an interview on Tuesday that Ukraine does not have “enough forces” to restore sovereignty over Russian-occupied Crimea and “must seek diplomatic means” to end the Russian invasion and regain its land. The state-run Ukrinform outlet reported that Zelensky described Crimea – which Russia colonized…
Ultra-Processed Foods: How Bad Are They for Your Health?
by Olivia Cook
(Natural News)—Despite the serious health risks associated with eating junk food, they remain the most consumed food products in many countries, particularly developed ones. But a review published in The BMJ, which studied 9.8 million people, warns that eating a lot of ultra-processed foods can increase your risk for 32 diseases. Among these are heart…
“Already Pretty Far Down the Line”: The Container Store Could File for Bankruptcy as Soon as Next Year
by Tyler Durden, Zero Hedge
(Zero Hedge)—As the retail apocalypse that started with Amazon and e-commerce continues, the latest victim is The Container Store. The retail giant could file for bankruptcy as soon as next year, according to the New York Post, who said the retailer is blaming its recent descent on “a weak housing…
Mysterious ‘Car-Sized Drones’ Over New Jersey Prompt FBI Investigation
by Zero Hedge
Several weeks of mysterious drone swarms over the skies of one New Jersey county near the military research and manufacturing facility Picatinny Arsenal have sparked concerns among residents and prompted an FBI investigation. “It’s kind of unsettling,” Mike Walsh, a Morris County resident who has spotted the drones on numerous…
UNESCO’s New Mission: Train Influencers About Combatting Online “Misinformation”
by Reclaim the Net
The UN Educational, Scientific and Cultural Organization (UNESCO) is now incorporating teaching influencers how to “fact check” into its activities. UNESCO claims that influencers have become “primary sources of news and cultural information” around the world – which prompted it to carry out a survey into how these online personalities…
