We are developing the social individualist meta-context for the future. From the very serious to the extremely frivolous... lets see what is on the mind of the Samizdata people.

Samizdata, derived from Samizdat /n. - a system of clandestine publication of banned literature in the USSR [Russ.,= self-publishing house]

Samizdata quote of the day

The point is that recessions are not caused by a lack of demand. They are caused by people making the wrong things (i.e. destroying wealth). We know they are because enterprises make losses and sometimes go bust. Recessions end when people start making the right things. All that money printing does is keep people making the wrong things. All that state spending does is encourage people to make even wronger things.

– Patrick Crozier comments, in a discussion sparked by his own posting about Keynes for the Cobden Centre, here.

I am finding the many jokes I hear about people going out shopping and thereby “rescuing the economy” less and less funny, and more and more stupid and tragic.  These jokers seem really to think that this is how it works.

7 comments to Samizdata quote of the day

  • Paul Marks

    They are TAUGHT that this is the way it works Brian. By the education system (the schools as well as the universities) and the media also.

    That spending (“effective demand”) is good – and the way out of a bubble is to create another bubble.

    Or even to recreate the same bubble.

    For example, Lou Dobbs on conservative Fox News.

    “The economy is going to come back this year”.


    “The housing market is comming back”.

    In short the credit money the Fed is pumping out (as the Bank of England is Britain) is going to prop the housing market (just as it in Britain).

    When I was young, if I heard something like this my mind would be filled with thoughts about how I could convince the person of their error (what evidence I could show them – what reasoned arguments I could present…..). I have learned from long experince that this does not work. One can spend years poltely trying to convince someone – and they will carry on (with their statist actions – as well as their words).

    If I were to type out here what thoughts enter my mind, these days, when I hear such stuff – I would either be in prison or an institution for the criminally insane.

    My tolerance has worn away.

    Even although I quite understand that it is “not their fault” (see the start of this comment).

  • RRS

    The history of economic and cultural development, particularly of Western civilization since 1500 may be viewed as revealing concurrent economic successes and economic failures along with cultural successes and cultural failures.

    In those periods in which the successes outweigh the failures in either economics or culture the civilization appears to “advance” or “improve.” At other periods failures outweigh successes, conflicts arise, cultures clash and diminish in their relative importance.

    We may be witnessing one of those periods in which failures both economic and cultural are outweighing successes. It would be worthwhile to inquire as to why that has occurred and seems to be continuing.

    A great deal of attention has been paid to the role of technology in the matters of economic (and currently cultural) successes. But little attention seems to be given to the causes of economic and cultural failures.

    There was some attention paid to what was presumed to be the “collapse” of socialism economically, but without regard to the cultural role of socialism (where it has not yet been seen as a failure).

    There are better clues to recessions, expansions, stagnation and declines than are provided through study of Keynesian or supply-side economics exclusively.

  • I am very glad you’ve posted this for two reasons. Firstly, it relieves me of having to agonise about linking to it myself. It seems so terribly immodest. Secondly, this was a line I came up with 20 years ago, long before I was properly acquainted with Austrian economics. It’s also the first time I’ve ever used it in print. So, well spotted!

  • Michael Jennings (London)

    I am hard pressed to understand how anyone could think that the solution to a crisis caused by too much debt is more debt. But they do.

  • jerry

    ‘I am hard pressed to understand how anyone could think that the solution to a crisis caused by too much debt is more debt. But they do.’

    ‘They’ are not interested in a solution. The only thing that matters is staying in power.
    One way of accomplishing that is more spending. This effectively delays
    the inevitable day when the ‘bill comes due’ and the spenders are convinced that they will gone, in one way or another, when that day comes so ‘let’s party on’.
    Disgusting, isn’t it ??!!

  • RRS

    On the “uses” of Governmental debt;

    here follows my commentary over at Libertyfund.org (Liberty & Law) – scroll down to the bold type:

    In response to a review of Nicholas Eberstadt’s A Nation of Takers which asked the question: “Are We a Nation of Takers?”

    Actually a large segment of the public has become a nation of “Users” rather than a nation of “Takers.” The distinction is important from the standpoint of individual liberty which, after all, is the point for the existence and maintenance of this website.

    Careful readers will note that Dr. Armor and Dr. Levin frame their philosophies in terms of proper or better uses of the mechanisms of governments. As a subscriber to National Affairs, I have read Dr. Armor’s proposals for “ reforms,” as well as other similar “reforms” recited in that publication.. I have also read Dr. Levin’s essay in A Nation of Takers. No one seems inclined to give up on the uses to be made of the mechanisms of governments, be they federal, state or local, for specific objectives.

    We have long had the primary example of the perversions of our legal system by the uses made of it for attaining individual, ideological and political objectives. This has been accompanied by complaints of the changes in the motivations and actions of lawyers who have adapted their practices to conform to the uses being demanded of the legal system by the broad spectrum of the public. We now have the legal system shaped (or misshaped ) by the uses being made of it for those objectives.

    The uses of the mechanisms of governments involve the coercive powers of government, principally, but not limited to, taxation and regulation. Every entitlement for some requires an obligation on the part of others for its fulfillment. When entitlements are established through the mechanisms of governments obligations are imposed through those coercive powers. That is a definitive limitation on individual liberty.

    The label of “Rent Seeking” is applied to economic objectives of the uses of the mechanisms of governments. Large swathes of the public have become Rent Seeking participants, both directly and indirectly, through organized efforts and in response to inducement or seduction by the deferment of obligations through the means of governmental indebtedness at every level of governments.

    We once had a Constitution that operated to limit specifically the uses that could be made of the mechanisms of the federal government. There are some uses whose prohibited functions are still observed. Even those are constantly tested. They are tested primarily by those who would use the functions of governments for ideological, economic or political objectives.

    Normative Libertarianism, as a defense of individual liberty, is framed by the impacts of the functions of governments on liberty and thus to limit those impacts by limiting those functions. The demands for increased uses of the mechanisms of governments call for proliferation of those functions. That proliferation increases the impacts of those functions on individual liberty.

    Many who become recipients of transfers from governments and are labeled by Dr. Eberstadt as “Takers,” fall into that category out of necessity of some partial defense against the burdens of imposed obligations. Many become “Users” for the same reason. Others who fall into Dr. Eberstadt’s classification as “Takers” are seeking offsets to the processes of redistribution that are being carried out through the political allocation of costs, as differentiated from the redistribution of incomes. Redistribution through political allocation of costs has not had an adequate examination of its effects and the reactions to it that has been applied to redistribution of incomes.

  • lucklucky

    Hmm the Monster of Samizdata ate my post.Any mod can look at it?