These are the contributing authors on this site.
On April 21, the International Monetary Fund (IMF) projected (see the World Economic Outlook, pp. 36-37) that the US foreign debt will increase from about 4.5% of world GDP in 2007 to about 9% in 2009. Given that the US foreign debt was 17.7% of US GDP at the end of 2007, this means that our foreign debt will be about 35% of US GDP by the end of this year as shown in the red line on the graph below
US foreign debt tends to increase when the United States runs a trade deficit on goods and services using money either borrowed from abroad or invested by foreigners in U.S, assets. The black line shows the cumulative effects of US trade deficits since 1987. The black line has been rising every year, except 1991 when the Persian Gulf states gave us huge gifts in return for our liberation of Kuwait from Iraqi control.
The US Foreign Debt does not climb as smoothly as the cumulative trade deficits because the value of American holdings of foreign assets (mostly stocks) tends to fluctuate with stock prices, while the value of foreigners’ holdings in the United States (mostly bonds) tends to be stable.
Myths about the Great Depression were once a mere annoyance. Now they have become a source for tyranny. The Bush-Obama response to the meltdown proves that one thing is certain: until we get the history of the 1930s right, liberty will be under threat of those trying to repeat the drama.
Thank goodness Robert Murphy has come along to straighten out the mess in a way that everyone can understand. In this hard-hitting book, we find the most accessible and most truth-telling book about the Great Depression and the New Deal that has ever been written.
Free-market economists have been working for decades to make the record of the calamity clear. This book may just be the magic bullet we’ve been looking for to kill off the myths before they kill us.
He puts together in one easy package the research of hundreds of scholars, showing that it was not capitalism that failed in 1929 but the boom times created by Fed credit expansion. Murphy takes aim at the Chicago School economists and the Keynesians who continued to be in denial on this central point.
A particularly great feature here for Austrians dealing with monetarist myths: Murphy explains that the deflation in the 1930s didn’t have to be somehow devastating. It was not egregious by historical standards, and was fully compatible with economic growth. In fact, the Fed tried but failed to flood the economy with money in the 1930s. Here Murphy provides a very compelling explanation of fractional-reserve banking and its effect on the supply of money.
He further shows that Hoover was not a free-market president. His policies were so statist that he might as well have been a Soviet agent. His biggest critic, who blasted him for his spending and centralization, was none other than FDR. But once FDR came to power, he enacted the longest string of cockamamie, prosperity-killing measures of any president in American history.
The economy still hadn’t recovered going into World War II, a war that didn’t help the economy or get us out of the Great Depression. It prolonged the government-made pain.
Murphy dissects the real history here with facts, analysis, clear prose, suggestions for further reading, fantastic quotations from all the main players, and even when he is discussing complicated data, he never leaves the reader behind.
Murphy concludes his book by recounting what led to the current crash. And wraps it all up with an excellent criticism of Bush-Obama and predicts that their policies will prolong problems.
This book appears as part of Regnery’s “Political Incorrect Guide” series but, in fact, this account is not biased in any particular direction. It is just good history, accurate history, truth-telling history that we have to know to navigate the treacherous waters of today’s economic and political environment.
Capitalists everywhere should have this on their bookshelf and in their briefcase.
(272 pages, paperback, 2009 ISBN: 9781596980969)
Mises Daily by Doug French | Posted on 4/29/2009 12:00:00 AM
Obama’s 100th day is upon us and the new president is ramping up an expansion of government that will place him alongside some of the most notorious dictators in history. CNN’s senior political analyst Bill Schneider may believe Obama’s personal qualities make him “the superpresident,” but first and foremost, Obama with his $3.5 trillion budget sees himself as the new FDR, armed with a new New Deal.
But the New Deal wasn’t new when FDR did it. The charismatic Roosevelt was more than 200 years behind John Law’s Mississippi Bubble, described as “the first New Deal of the capitalist order,” by John T. Flynn in his amazing book Men of Wealth.
In a chapter devoted to the money magician, Flynn cleverly calls Law the “evangelist of abundance.” And conditions in France could not have been riper for Law’s fiscal chicanery in 1715. France was completely ruined by Louis XIV, a ruler whom history has been much too kind to, according to Flynn. He ravaged the country he ruled, while being a “shallow, egotistical, pretentious coxcomb.”
Louis spent vast millions on his palaces and engaged poets and writers to write of his virtues, long before the days of CNN. As Flynn explains, industry had not come to France, thus the king stole his wealth from small farmers and city-dwelling artisans through oppressive taxation.
So someone in the White House thought it would be a good idea to have Air Force One fly over NYC the site of the terrorist biggest success. And why pick NYC instead of Baltimore, Washington or any other city? Who ever came up with the idea was celebrating Allah’s deliverance of the White House into Muslim hands. Eight years after 9-11 the worlds Muslims can rejoice. Allah has placed one of his disciples into the White House and the fly over was symbolic of that triumph. Allah had triumphed over the infidels and here was proof, Air Force One flying over the hollowed ground zero. The sacrifice was worth it. Victory of Allah over the infidels. The chosen one is in control of the infidels.
The Air Force took the hit for the publicity stunt. What would you expect? The real culprit take responsibility? Not a chance. I can assure you there is no way the Air Force would ever do such an idiotic thing. No way. Not part of the mission. Not how they think. The idea for the publicity stunt came from a Muslim or Muslim sympathizer inside the White House. The enemy is inside the walls and the main stream media ignores the blatant pro Islamic fascism even when it flies over their heads
Mises Daily by Clifford F. Thies | Posted on 4/28/2009 12:00:00 AM
Can states secede? There are three levels on which this question can be answered:
The Inalienable Right of Secession
The Declaration of Independence of the United States of America invokes the self-evident truths that all men are created equal and are endowed by their Creator with certain inalienable rights, that governments are formed to protect these rights and gain their just powers from the consent of the governed, and that when a government becomes abusive of these rights, it is the right — no, it is the duty — of the people to alter or abolish that government.
To say governments were formed to protect the rights of men would be historically incorrect. Almost all governments were formed by ruthless men exerting their will over others through the use of force. Some governments, over time, evolved toward the rule of law, perhaps only because their rulers saw that this would sanction their own continued enjoyment of the wealth that they possessed. In some instances, this evolution involved one or more “revolutions” in which those who were governed were able to better establish the rule of law.