SATURDAY ESSAY: Shaving Private Ryan

Ryan & Romney’s Laugh-in

Cut through the Ryan hype, and there’s a bare-faced babe in arms underneath.

On the basis of Dan Hannan’s tweeted recommendation (I simply will never learn) I decided yesterday to read Paul Ryan’s ‘Roadmap’ to economic and fiscal recovery for the United States. I’m a confirmed debunker of insight-free management consultancy, so Mr Ryan gets off to a 5-point penalty for me right away with his ‘roadmap’. It goes in there with critical path analysis, outputs, deliverables, windows and the rest of the jargonised nonsense churned out by those who have nothing to say, but are getting paid by the hour for doing it.

Ryan is being punted by the GOP spin machine as a brilliant econo-fiscal philosopher, presumably with the twin aims of (a) complementing Mitt Romney’s more ‘hands on’ approach to money, and (b) highlighting the fact that Obama is economically dyslexic – and his running mate is Joe Biden. It’s par for the course these days in politics to present anyone who can string a sentence together (especially in writing) as a hyper-genius, but then the example of Louise Mensch in the UK is a timely reminder that ability may be no guide to content quality.

In fact, Ryan is little more than a central-casting neocon hardline professional politician…his personal requirement for welfare until age eighteen (after the death of his father) notwithstanding. The Ryan males tend to keel over aged about 56, so at 42 we can be reassured – or horrified – that Paul would stay the course if elected. But he wouldn’t be a good bet as a two-term President after that.

Although Mr Ryan is not a Premier-league educational achiever (Miami University is way off the Ivy League ratings) he’s smart enough to have achieved a double major (joint honours) in economics and political science. But the subjects of his degree are for me a further condemnation. I’m a history/politics graduate myself – but then I went out and got a proper job. Aside from fries-shifting at McDonalds and waiting at tables, like most hardline politcians, Paul Ryan has never had a proper job.

He accepted a congressional position as a staff economist after graduating in 1992. Ryan then became a speechwriter for a conservative advocacy group, and later worked as a speechwriter for the Republican vice presidential candidate in the 1996 bunfight, Jack Kemp. After that, he worked as a speechwriter for Senator Sam Brownback of Kansas…by which time most of the speech alternatives were probably exhausted, so he returned to Wisconsin in 1997. Briefly, he became a marketing consultant….for Ryan Incorporated Central, the family construction company. You can just imagine, after that all that political speechwriting, how much Paul knew about marketing construction services: I think David Cameron might call getting this job The Leg Up.

Two years later, Ryan was elected to Congress against less than sparkling opposition, and went on to get re-elected six times in a safe GOP district. But credit where credit’s due, Paul has over $5.4 million in his congressional campaign account – more than any other House member. So, like UK MP Jeremy Hunt, he’s good at raising funds. For himself.

Like I say, Congressman Ryan is a card-carrying technocrat politician who has spent his life in academia, Congress, and falling back on the family. His fiscal economics are thus entirely theoretical and other-directed – and it shows.


As it happens, I didn’t know any of this before consulting Rep Ryan’s Roadmap to Utopia. Reading it yesterday with an open but sceptical mind, I was at first impressed: the analysis of where previous Washington policy had veered off piste was very good indeed, and there were references to the correct use of welfare which perhaps, on reflection, chime with his personal experiences as a kid.

But several pages, diagrams, graphs and promises in, I was still looking for the directional signs beyond vague flim-flam about the evils of Obaman medicare and incontinent budget control in Washington. I mean, there’s all that taxpayers’ money wasted on speechwriters for a start, so he has a point. But by the end of the main document, the signs seemed to point me to where I’d been rather than where I might want to go.

In the Roadmap introduction – A Choice of Two Futures – there is a well-written but staggeringly naive and selective analysis of collectivism versus free markets. And when one gets into the detail of his medical provision model, it has that disturbing preference for the systemic theory over the human experience that characterises so many Believers. This for instance on the Obama model – of which, by the way, I am myself a stern critic (my emphases):

‘The entire methodology of the program must be converted away from a program that shelters providers and consumers from prices – and is therefore inefficient in restraining rising costs – into one in which beneficiaries choose the most affordable coverage that best suits their needs.’

The emphases highlight my belief that Paul Ryan is just another Andrew Lansley: no concept at all of the reality that most people in this life – even in the wealthy West – are anything from of limited means to dirt poor. It’s hard for any beneficiary to choose affordable coverage if he or she has little or no money….and the cost of straightforward anaesthesia is $6,700. It’s also hard to feel reassured about medical fees when every ounce of your experience gives you bad feelings about the wriggle-skills of insurance companies.

Choice is fine if you’re middle class and pensioned like me. But neocon economics have ensured that, since 1988, the average American worker has been offered a smaller and smaller slice of the economic apple pie – thanks to a super-rich 3%, and jobs moved offshore. Mitt Romney hasn’t moved every last job offshore, but let’s face it – the guy is implicated. As indeed is his wealth…after a level of taxation we have yet to be allowed to examine.

Ryan is, in outline, good on how to make medicare a better bet. But you’re left asking why his Party had never lifted a finger to tackle the issue at all before Obama enacted his recipe for fiscal disaster. He’s excellent on thrift, and the need for balanced budgets…but in that context, the box marked ‘Reaganomics’ is left blank. President Reagan (a fine man in arms-control foreign policy, and a well-meaning leader) left behind the biggest debt in US history. His Republican successors since that time have been building on that mountain of fiscal thrift. For all his myriad faults and empty gestures, President Obama inherited a level of deficit unthinkable for Americans even a decade ago.

Paul Ryan’s roadmap, in fact, is largely significant for the two things it leaves out: practical detail, and any realistic appreciation of what 2008 was really all about. It is 90% a description of the fiscal geography of America, and 10% Roadmap. Basically, the actual route is in the Appendix.

The heading for the Roadmap comes well before that – ‘Description of the Legislation’ – but what follows is some desperate self-justification of the flim flam –

‘…this proposal is a comprehensive plan for restructuring health care, the Federal health entitlements, retirement security, and Federal taxation to put the Federal budget and the U.S. economy on a sustainable path….The proposal should not be viewed as a rigid, absolute plan. It has flexibility built into it so that it can adapt to conditions that surely will change over the course of the century. Nevertheless, it is a complete and comprehensive approach.’

– and then just a load more bromides about ‘every American should be free from fear of medical bills’ and ‘putting the consumer back in control’ – in other words, the same old same old that sounds great in print, but gets perverted by the first insurance accountant let near it.  It is an enduring fault of most neocon ‘thinkers’ that they are naive about the ethics of private business, and paint a picture of ‘consumers’ as if they might be sophisticated, discerning purchasers of financial services. Let’s get real: if they were, Lloyd Blankfein would be two-bit theatre producer.

The Roadmap steps (Appendix I) are based on the assumption that the US is a fundamentally healthy economy, and the only nation on the planet. Like all cod futurology, no allowance is made for technological change, foreign recession, Asian slowdown or China’s ownership of most American debt. No recognition is made of relative Asian/Western wages. No mention appears at all of the growing inequities of wealth in American society.

On healthcare, the ‘idea’ is a classic, complicated Gordon Brownesque tax credit. Washington gives you some money to get insured, you get insured with your insurer of choice. Everyone lives happily ever after. It isn’t costed. That’s it. But there’s a lulu under the heading ‘transparency’: a one-liner….’See medical component of this legislation’. I’m sorry, but I laughed out loud at that point.

On social welfare, the first ‘idea’ is a remake of the old ‘opt-out’ Thatcher scam from which some folks in the UK are still suffering: ‘…provides workers under 55 the option of dedicating portions of their FICA payroll taxes toward personal accounts, or remaining in the current Social Security system.’

It envisages four ‘phase-in’ stages that are complete by 2042, when Paul will be 72 and, given his genes, very probably extinct. Only an ivory-tower Washington wonk could seriously suggest that one can plan a social security system change over…oh sorry, I forgot: it’s flexible. Ah, right.

The second ‘idea’ is an extraordinarily complex and bureaucrat-intensive system designed to protect workers as they save for retirement, by ‘indexing’ their wage and price exposure at 2018. That’s basically an inflation-proof pension, almost non-existent these days in the private sector because nobody can afford to provide it. Not surprisingly, this isn’t costed either.

Look: I could go on, but it is going to get boring. The point I’m making is that the content is recycled, busted-flush bollocks, and there is no evidence provided that it will save any money for the State. Frankly, in the context of a $3trillion deficit growing daily, this is less than useless as a roadmap to anything except the cliff-face of national insolvency. And we have about as much chance of Ryan showing us the numbers as we do of seeing the balance in Mitt’s Bahamian bank account.

So let me instead close this critique by focusing on Paul Ryan’s at best gullible omission of the events that got us to where we are today. The Unmentionables are, chiefly:

1. Hank Paulson and $870bn. On toxic asset relief (TARP) Ryan hilariously offers this judgement:

‘The Troubled Asset Relief Program was intended to thaw credit markets that seized up during the financial crisis – and it succeeded in its short-term objective’.

It didn’t thaw anything Paul, it stopped Lehman turning into a whole row of over-leveraged dominoes within the month. That was indeed its short-term objective, but we have yet to see an audit of where the money went. (Can we also have a little more detail on the seizing-up thing, or was this a spontaneous, celestial event similar to the Second Coming in which Romney so passionately believes?)

2. Lack of banking reform. Not a single substantive change was enacted to create a Glass-Steagall firewall, calm the bonus culture, write off derivative lunacy, or prosecute malfeasance.

3. Trickle-down wealth. Rather than trickling down, it’s spouting upwards like a Texas Tea gusher. Funny how nobody from Dan Hannan via George Osborne to Angela Merkel ever wants to discuss that side of Friedmanite thought.

4. Congressional self-abuse on the subject of deficit action, and Ryan’s personal role in the mass onanism. The Republican capture of the House in the November 2010 elections set the stage for a series of budget confrontations in 2011 between President Obama and his Democratic allies in the Senate, and conservatives who campaigned on making steep cuts to government spending. Fair enough. But The Republican response in April of that year starred none other than Representative Paul D. Ryan of Wisconsin. Unveiling his party’s 2012 budget, he said the plan would reduce the deficit by $5.8 trillion over the next decade, mainly by making deep cuts in discretionary spending programs, and turning Medicare into a “defined benefit’’. Is that what it says in the Roadmap Paul? (And we still don’t have the costs: maybe they’re in a Bahamian account too.)

5. Flagrant criminality on the part of everyone in Wall Street from Goldman Sachs to Barcap. Fines handed out like confetti. Fines paid by banks in return for not admitting their obvious guilt. Not one culprit of the 2008 disaster doing time. Speaking less than clearly from within this herd of roomed Elephants, wide eyed Paul Ryan merely makes the following contradictory observation:

‘In a single stroke late last year, the House passed the most significant overhaul of the Nation’s financial system since the creation of Depression-era banking and securities laws….The new legislation expands the role of government in the financial arena on multiple levels for institutions and individuals….The financial bill creates a new government agency designed to safeguard consumers from risk-taking for a broad array of products, from mortgages to credit cards. But ironically, the new bureaucracy will harm the very consumers it seeks to protect: by writing far-reaching rules and restricting risk, it will limit consumer choices, ration credit, and hamper individuals’ ability to make investment decisions.’

Where to start on this one? The GOP had the House majority for all of the period, so I’m not clear what point Mr Ryan is making. Calling it a ‘significant overhaul’ is a bit like saying that the European EFSF is overfunded. Despite the $23trillion global write-off of crazy investment bank risk since 2008, Ryan doesn’t like restricting risk. And ration credit? Is he kidding? What does he call what the banks are doing now, the Marshall Plan? And once again, per-leeeze…most people don’t make individual investment decisions: it’s all they can do to work the remote control. Naive folks are sold investment products they usually don’t need by snake-oil salesmen like Bob Diamond.

This is the bottom line: the roadmap is dated August, 1979. What we need is new roads, not an old roadmap.

I find myself back considering the wisdom of Peter Oborne’s 2007 book The Triumph of the Political Class. If one thing needs thawing out in the political elites of the West, it is the mammoth residing in their undertstairs loo: the constant factory-like production of high College-educated idiots with no experience and even less humility.
Such clones continue to be forced upon local selection committees by the Big Party Machines as fodder designed to vote the ‘right’ way, and agree with the Executive about everything. There can be no doubt that senior politicians throughout the West are perfectly well aware of just how dysfunctional this is, but to change it would be to loosen their incompetent grip upon power.
Dan Hannan blogged in the Telegraph that there were two words to explain why Americans should vote for Romney: Paul Ryan. Oh, and Mrs Romney. Not Mitt Romney for it is he, then? Well, Dan would like to get selected too, and good luck to him. But the self-publicising MEP is showing a truly superficial appreciation of US politics in making that recommendation. Romney is an asset-stripping, tax-dodging, offshore-job-shifting right wing Republican, and Paul Ryan is in there as his running mate because he has what look like squeaky-clean credentials as a fiscal reformer. It really is that simple.
This is no different to super-cool thin black dude a bit intellectually up himself choosing a yob like Joe Biden. In political circles, it’s called complementing. But it’s meaningless packaging – just as Ryan’s roadmap is yet another guide to the past…its type faded, it’s cover bent, and its pages curling at the edges.
I won’t be reading any more of Dan’s recommendations. But I do thank him profoundly for providing the Slog with some more evidenced deconstruction of drivel.

26 thoughts on “SATURDAY ESSAY: Shaving Private Ryan

  1. Enjoyed the read.

    “into one in which beneficiaries choose the most affordable coverage that best suits their needs.”

    Being cynical it could work although as you state the 6K bucks for an anaesthetic implies nobody would pay taxes anymore. At that point you could say the politicians killed the “FEW” taxpayers left that pay taxes to feather the political nests with the solitary taxpayer now preferring to feather their own nest instead and could you blame them?

    Evolves to the grand tax plan is then nothing more than to feather ones own nest and then by taking so much you have to provide feathers for the poorest to feather their nests. It’s in every feather tax we pay and just look at what you get back for the justified taking of the feathers “nothing in the main”. It will certainly be less than the market worth because it has been skimmed off the top into de-luxe nests with all mod cons.

    The NHS was set up with a need then it was skimmed off at the top so it ends up in the state it is in. Now if you slaughter the NHS cow once and for all how would the top be able to skim from the taxpayers nest? in fact how would they get elected when one of the two weapons they champion to get elected is removed (education being the other)? You end up with an NHS, kept alive by all means neccessary to keep the politicians in power who would skim off the top for as long as it remains.

    Hence Mr Ward you will never get your mutualisation although it would be a good thing as you would be removing the politicians in the process.


  2. Here’s a research report on Paul Ryan by American Bridge that was set up to dig dirt. If you ask me, they tended to struggle at times!

    He doesn’t come across as sociopathically evil as some, (unless they’ve decided to omit the tales of ritual sacrifice and pedophilia which tend to be the norm in these circles) and in fact I would say they’ve probably done him a favour, especially when it comes to filling out his profile on social networking sites (something I,for one, hate doing with a passion!)


  3. Being a good-looking young man (he looks like a nice boy) will no doubt help him with the uninformed female vote. Which is of course what helped to get T.Blair & Camoron elected.


  4. Not being an expert on what young ladies may or may not find attractive, I asked my 29 year old daughter about the two named gentlemen. Her initial reaction would best be described as ‘incredulous’, followed by, ‘not if they were the last representatives of their gender upon the face of the earth’.


  5. My road map tends to stay in the pocket in the back of my passenger seat and I guess Romney/Ryan’s would too if they get elected. I usually tend to know where I’m going so I don’t need a road map most of the time. When I do use it, it is usually pretty helpful and gets me where I want to go. Unlike Romney/Ryan’s which sounds like a load of flim flam.

    We know what they will do, cut everything but the military and send as many more jobs offshore as possible, while also protecting banksters and assorted con artists from the jail they richly deserve. Thanks for reading it though John. Don’t know if Roseanne Barr has a road map too but perhaps you could read hers next if you like that kind of thing. I suspect Obama must be using a satnav which appears to be taking him down routes where he is bound to get stuck in a deep hole.


  6. Obama is not using satnav he is relying on dead reckoning. He is maintaining his present course until November. We can only hope he will make a turn before he hits the mountain he is heading toward once he is reelected . Hope $ Change


  7. Just as Obama has made me wistful for the sometimes (or maybe mostly) mangled syntax of GWB – which in 2008 I never thought possible – Mr. Ryan has left me pining for the intellectual honesty of Sarah Palin (or at least her legs).

    Excellent analysis as usual John. I have been having massive arguments with everyone that Mr. Ryan is even less equipped to create a budget than Obama. Anyway in the Bankster universe most want TOTUS in their hearts since that will ensure the Bernank will shower them with liquidity -lower taxes on lower earnings wont help them , higher nominal taxes with tons of loopholes so that effective tax is low on risk free transfers of wealth from the populous to the elite is a much more exciting prospect.

    I am a capitalist and the game hasn’t been capitalist for at least 30 years. Ryan’s plan ensures the swindle is non-reversible.


  8. @Caratacus
    I am delighted to see that your erstwhile genes have propagated unaffected by the quirkiness of meiosis. However, I should like to know the exact wording of your question in response to which your progeny so eloquently responded.


  9. Good article JW. well worth the time it took to read, to all your readers the “Triumph of the Political Class” is well worth the read, but it is a little outdated now.

    To Sum up, With Romney/Ryan we get screwed, whilst with Obama & Co, we get stuffed. We have Cam/Leg combo and Boy Millie, doing the same.

    Regarding Capitalists and their complaints about government spending, they would be the first ones to squeal, if the government got serious and really stopped spending on high priced government projects and just spent on basics.

    Like i am maxed out on my O/D CC etc i have an old car but it runs fairly well, O! sod it i’ll ask the Bank/Taxpayer for more money and get a new car/build a new rail link. Its only paper any way.

    Until we can get legislation to freeze MP’s and Senior Civil Servants wages/pensions till we at least have a balanced budget, nothing will change. Or until we really run out of credit, and the Plebs and Financial Gangsters Revolt. Then things could get nasty.


  10. Pingback: When will the most protected, subsidised State-owned business finally be deregulated? | A diary of deception and distortion

  11. The Ryan plan makes Tory and Labour spending plans in 2010 look like a dual bi-partisan truimph of political tranparency.

    The modern Republican party is completely off the scale. Obama may be a wimp, and the Democrats are deeply corrupted, but I genuinelly fear for western civilization of their opponents sweep the board in November.


  12. Paul Ryan claimed to have run a sub-3 hour marathon once.
    It turns out he ran a 4.01 hour marathon once. Just a leeeeeetle lie, but it’s the difference between a really quite remarkable acheivement, and , well, whatever.


  13. Yes, Obama uses a teleprompter, like every other President for decades.

    You lose all credibility with that one.

    No, wait, you lost it when you took the name of the utterly discredited gold bug Von Mises.


  14. A sub 3 hour marathon is f*cking difficult for a “normal”. A 4 hour marathon is nothing special for a bloke in his twenties.

    So, no, no big deal. It just shows Ryan’s a guy who lies all the time and expects to get away with it. And if he’s caught, he knows there’ll be people saying “When did people start caring how fast their politicians could run?”


  15. Can you explain how Von Mises view of the gold standard has been discredited.In fact the massive asset credit bubble pumped by the Fed over the last 30 years seems to me in great danger of being discredited.

    I reiterate, Totus and Romney are equally appalling to me. Totus has no economics philosophy he is a lawyer (which is why he lives via the TelePrompter and doesn’t just use it as a tool convincing the jury is all that matters), while Romney was great at arbitraging the insane accounting and tax rules in the USA that distort capitalism a strangely acceptable state of affairs for the MBA’s of the world. (I worked in structured derivatives for a long time which was unfortunately mainly about the same thing, taking advantage of the dumb rules that create different values for the same thing in different entities. Most who work in these areas, LBO’s, derivatives etc. don’t seem to know that the there is something strange about the idea that the regs are inconsistent, they think it is a legitimate game that allows them to benefit. Example I worked in credit derivatives. The bulk of the business is based on the arbitrage of insurers treating these as insurance contracts and the mark-to-market world treating them as options. The fact that when a trade is entered into, both sides see them as profitable because they use different accounting is not right intuitively yet it allows both sides to book profits today for things that cant work for both sides by maturity, yet the MBA-class thinks this is perfectly acceptable). I don’t see that as experience to rebuild capitalism at all.


  16. First : Excellent Post, your review was very satisfying and sufficient, It will not be necessary to read Paul Ryan’s Roadmap, Thank you for that!

    “In the Roadmap introduction – A Choice of Two Futures – there is a well-written but staggeringly naive and selective analysis of : collectivism versus free markets :.”

    The Phrase : “collectivism versus free markets”, represents a “Level Confusion” in Terminology and : indicates a BASIC ERROR in THINKING : Confusing THE REALMS OF THE DISCOURSE.

    Collectivism is A SYSTEM.

    Free Market Capitalism describes : A RELATIONSHIP.

    The Economic SYSTEM that best describes today’s RELATIONSHIPS in “Free Market Capitalism”, is TYRANNY: Since : a Perpetual War-Time Economy: is State-Sponsored terrorism or Tyranny, rule through FEAR, and that is OUR SYSTEM, not “Free Market Capitalism”, which is our RELATIONSHIPS to each other.

    Rule Through Fear is contrasted with Rule Through REASON<Diplomacy through THE State Department exercising: Understanding, Compassion, and above all Reasonableness, and not over-handed PUNISHMENT.

    Systems and Relations DO NOT EXIST on the SAME LEVEL.

    Let me explain : In Southern California, where I live, over the last week, a young boy developed a rapidly deteriorating flesh-eating disease, obviously, the parents decided to attend the last week of their son’s life and Freely Chose not to be at work, but instead remained at their son’s bedside until his death, this is sufficient grounds for work-dismissal in “Free Market Capitalism” : and that’s because the Social Relations between Management and Labor are embedded in the System of Tyranny, which are wage-slavery, even without a contract, it is Slavery over Free Will.

    In The System of ‘Collectivism’ the Relations are “Volunteerism” such that no job is Critical to the Collective’s Success and anyone can attend where VALUE is best Individually Determined.

    In order for Tyranny to succeed and remain in place, it is essential to confuse Two Terms : A : ‘Contract’ : with : ‘Volunteerism:’. Let me explain :.

    The United States Citizens & Military “Claim with Pride” that the have “An All Volunteer Armed Forces”. This is a BASE LIE.

    When a Volunteer Causes to sign a Contract, they are NO LONGER A Volunteer, they are a Contracted Employee, and in the Case of the US Military, They are Mercenaries, paid to kill, even their parents, if so commanded.

    A Volunteer would never kill their parents. A Mercenary is Commanded to kill.

    This confusion arises from a Misunderstanding of “CAUSE AND EFFECT”, since when a Volunteer Causes a Contract to Be signed they are EFFECTIVE Immediately, no longer a Volunteer.

    Confusing ‘Cause from Effect’ is why Tyranny flourishes, since the public remains largely inEffective, not understanding what Causes what, they remain paralyzed to do anything EFECTIVE, causing nothing to change, and this is why Tyranny flourishes.

    It appears with your review and analysis, Mr. Ryan’s : “Choice of Two Futures” is nothing other than an inept attempt at Wholistic thinking, inadequate :.

    Thank you for your efforts reviewing Mr. Ryan's attempts at tragic-comedy.


  17. Ludwig,

    First, as Josh Barro said “There are two big reasons today’s right loves the Austrians. One is that Austrian economists reject empirical analysis, and instead believe that you can reach conclusions about correct economic policies from a priori principles. It’s philosophy dressed up as economics; with the Austrians, there is never any risk that real-world events will interfere with your ideology.

    And that is how so many on the right have pulled off the remarkable feat of going through the 2008 crisis and its aftermath without revisiting any of their policy views. …
    But if you have Mises at your side, you “know” that empirical findings have no bearing on what policy should be. Leaning on Austrian thinkers is a great way to avoid further thinking.” (

    The crisis was the result of the most insanely irresponsible private financial services sector since the 1920’s. While the Fed did play a part, claiming that a gold standard would have solved the problem is absurd. Giving up control of sovereign monetary policy did absolutely nothing to help Souther Europe, and a great deal to harm it, since a contractionary monetary policy would have been the ideal solution in Spain pre-crisis.

    As to the other point, Obama uses a teleprompter, so has every President for decades; and yet somehow the idea that a black guy uses one is grounds to make it unacceptable; funny how that works.

    You want to criticize policies, you might have some points. But saying, “well he’s a lawyer and he uses a teleprompter” just demonstrates you are familiar with GOP style racist dog whistles more than policy issues.


  18. Additionally, Austrians claimed the stimulus would lead to catastrophic, Weimar style inflation; and we’re experiencing nothing of the kind here in the states.


  19. The core of Von Mises (of which he is part of the Austrian “School” but it is not monolithic) is much more sophisticated has very little to do with the Gold Standard. Von Mises view (when asked to address it) was that a Fiat system could work if it wasn’t perverted by political aims, however even though he recognized some issues from a gold standard he also acknowledged that it would be safer to have money supply out of political hands which is easiest with gold, but not optimal as he recognized it is constraining. However as you point out the ignorant right of the republican party has perverted his view to be at the extreme orthodox end. From 1994 on it has been political machination after machination from Greenspan to Bernanke.

    I am not a Republican and am actually repelled by the Tea Party right. In my view it was stupid supply side economics combined with Milton Friedman style monetarist manipulation plus the plundering of the US pension schemes (under Reagan) into the cult of the equity that lay the seeds to the current crisis.

    We are in a deep deflationary retrenchment after a credit bubble in terms of labour and manufacturing. The mistake you make is that there has been no stimulus. QE and the bank bailouts have not been proven to be stimulative just transfers of wealth from the taxpayers to the Bankster. We do have HYPERINFLATION in asset values relative to where a free market would put them given lackluster real economic performance. Every time the fed buys a treasury and lends to JPM etc at zero, it allows them to bid up equities, commodities etc which is why there has been a total breakdown in relative values of risky assets. It is either RISK-ON or RISK-OFF. That is how a word form Bernanke or Draghi can add billions to wealth of the asset holders and zero to job creation etc.If instead they ha transfered the money (or credit) to the middle lower classes we would see huge price inflation of things due to demand, not asset appreciation. The asset bubbles will however collapse sooner or later when they need to be liquidated in a non-manipulated market. But by then the bankster class will have extracted most of the gain.


  20. Hmm, interesting points.

    Everything I have come across from the Austrian school (almost always from a US Republican), the argument involves the necessity of the Gold Standard and the insistence that the kind of increase to the monetary base done in the US is guaranteed to cause catastrophic hyperinflation. And recommendations to shrink the government work force.

    You’re right that Republicans have a lengthy history of oversimplifying and twisting economic theory; sorry to have been so critical.


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