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Spending and Debt: The Gears of Tyranny

Keynesians and central planners prefer to view economic activity as some kind of mechanical machine whereby the people and their exchanges are the necessary gears to get it moving. Insofar as the people and their exchanges affect the performance of the machine, the Keynesians and the central planners seek to bring the gears into hyperdrive, eliminating every delay and discretion that might otherwise prevent a transaction from moving the gears. 

In this way, the Keynesians and the central planners view the people as incidental to economic growth. The former lament the fact that their field of study has them dealing with mere human beings instead of raw, inanimate material; but this hardly keeps them from treating their human subjects any differently than the material they might otherwise manipulate at will. 

In this way, the Keynesians and the central planners view the people and their actions as constantly grinding the gears or needlessly slowing them down. The Keynesians and the central planners glorify spending because they view savings as deferred consumption merely delaying the fruition of economic activity. 

They take no interest in the prospects of savings where they stand in anticipation of a rainy day or in preparation for retirement; they would much rather have somebody, anybody, spending that money on something somewhere. 

Their interest is in the velocity of money, not the preservation of its purchasing power, nor in the preferences of those who actually earned it. Indeed, they seek to drive the velocity of money for a number of reasons. 

A higher velocity causes the proverbial gears to turn more rapidly, and with that higher velocity government stands to benefit in a number of ways: it gets in on more of the action through taxation; it keeps the people perpetually busy and assuming progressively more risk in their hopes of retiring or enjoying more leisure time; consequently, due to higher levels of consumption and government spending, the government can boast a higher gross domestic product and booming economic growth, which in turn benefits the politicians and enables the government to take on more debt; and, finally, higher tax revenues and debt mean that the government can expand in its reach and power to bid for more of the public’s acquiescence, and to further intimidate and exploit the honest and hardworking people who, as the Keynesians and central planners see it, exist merely to keep the gears turning. 

One way or another, the Keynesians and the central planners induce that higher velocity by cheapening the money. Whether intentionally or incidentally, cheap money has the effect of distorting the economy and distorting prices, but it also has the effect of distorting incentives; and in a society governed progressively by monetary incentives, it has the effect of cheapening the values of the people. That is because cheap money isn’t honest; it’s speculative. It doesn’t impose discipline or encourage investment; it invites frivolity and decadence. It not only corrupts an economy; it destroys a society.

Whereas the people are inherently motivated to do well for themselves and their own communities, the monetary system has served to broaden each individual's contribution and his own reward. This has offered plentiful advantages in economies of scale and division of labor, while generally promoting the values of the people. However, wherever that system has been corrupted by political interests, that system stands to exploit the people in support of politicians, their cronies, and their preferred objectives. 

This is perhaps the most pernicious effect of cheap money, and one which commonly eludes the untrained eye of the public. Of course, by the time this effect has reached a fever pitch, the public has long abandoned its traditions and its scruples in favor of the more tangible monetary advantages; all the while, the unsuspecting public has been swindled out of its values by cheap money, printed or digitally imagined out of thin air. In this way, they've been conned into worshipping a false idol at the behest of central planners. Of course, the Keynesians and the central planners are generally clever enough to cover their tracks or to otherwise leave their victims feeling richer and better about themselves in the process. After all, so long as inflation is driving wages and assets nominally higher, the people start to actually believe in their big lie. 

Ultimately, in discreetly stripping the people of their savings through the inflation tax, conceived explicitly for the purpose of boosting spending and thereby supporting government, those honest and hardworking people are stripped of their livelihoods, their freedom, their peace of mind, the product of their own labor, their rightful property, and the most gratifying aspects of life; they are condemned to spend more time at work, and they’re left increasingly defenseless against the onslaught of government, their cronies and their supporters, ranks that consequently swell as the government spends more of the people’s money. 

After all, a broke and indebted populace is far easier to intimidate and control than the alternative; by definition, they have fewer resources to practically defend themselves, and for precisely this reason they’re made progressively more amenable to the commands of the regime which promises safety and security at the expense of their freedom. 

In the course of having precious little in the way of wealth and yet so much in the way of debt, they become more willing to depart with their freedom for some measure of temporary relief; whether it be in the form of food or in the ability to repay their debts, they come to participate directly or indirectly in their own subjugation. 

In this manner, the people are beset by a veritable mob which is just as enthusiastic about theft as they are ready to accept any justification, however convoluted or irrational, for their actions. 

Fortunately for the mob, the business of government is booming, and its payroll has afforded government, its cronies and supporters ample support to continue their siege. Unfortunately, the mob consists of many who passively condone the misdeeds and, in still other cases, active members who appreciate neither the true implications of their actions nor the various losses they personally stand to incur wherever the mob stands to succeed. 

Whether it’s force of arms, pseudoscience, entitlements, protectionism or outright propaganda, the siege becomes progressively more destructive as the mob operates not only with malice, but with the benefit of its conscience. 

There is perhaps nothing more dangerous than a mob wreaking havoc with the benefit of its conscience; unless you ask government, of course, which would have you believing that the most dangerous person in the world is the person who thinks for himself.


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