Old Truth Blog

November 2020: I read this essay and added commentary for Episode 417 of the Everything Voluntary podcast . It is a simple fact that our world is a world of scarcity, that is, that human wants exceed the amount of usable resources to satisfy them. This is not say that usable resources are not being discovered, or that human wants will not change. Of course change happens. Oil was once considered a nuisance, but now it's considered a usable good. When people need the same resources (economic goods) to satisfy their wants, conflict ensues. This is what economists call the " economic problem ": How are things to be produced and the factors of production allocated in a world of scarcity? There are ways of handling conflict over scarce resources. People can fight over them, and to the victor go the spoils. Or, people can reason. They can use the resource between their ears to come up with ways of ending, reducing, and preventing conflict, leading to the creation of wealth an...

September 2020: I read this essay and added commentary for Episode 382 of the Everything Voluntary podcast. I am primarily a libertarian for philosophical reasons . This wasn't always the case. My ascent into libertarianism began with a study of economics. It began with the columns of Walter Williams . He frequently gives an economics lesson woven within his commentary on current events. I read almost every one of his columns available in his archive . I soon discovered his " Economics for the Citizen " series, a concise introduction to several principles of economics. From here, I discovered Thomas Sowell , a close friend of Williams. His " Basic Economics " was the first book I purchased on economics. (I've since purchased several of his books .) It taught me all about supply and demand, and why price floors and price ceilings have negative unintended (supposedly) consequences in an economy. I understood, from an economics point of view, the disaster th...

Stephen Kinsella posts a list of questions from a high school student seeking answers regarding the legitimacy of intellectual property "rights", as well as his answers. They provide a good introduction to the anti-IP position. These are the questions asked, click here for his answers: What would you say is the most powerful argument against copyrights and patents? What would you respond with to someone who argues that resources do not have to be finite or scarce in order to be allocated as property? How would you respond to Lysander Spooner’s argument that property is wealth that is owned, and wealth includes ideas since they can be manifested into tangible wealth? What about the argument that people own their minds, so they own the mental products? Some anti-IP people believe in a right to first sell. Would you say that the original creators should have a right to sell the creation first? Why or why not? What would you respond to someone who claims that if there were...

I couldn't believe it when I saw it. A defense of that universally-loathed villain Ebenezer Scrooge. I recently came across this exceptionally written piece and absolutely must share it. I should warn you, however, that reading this may well destroy for you what is regarded as a well-beloved Christmas story. It did for me. No more do I have the same opinions of Scrooge or even Bob Cratchit. Actually, although it's caused me to remove this story from favorites list, I'm glad I've read this piece as it has connected my study of economics with my childhood. Written by Butler Shaffer , an excerpt: It is instructive that Dickens tells us virtually nothing about the nature of Ebeneezer's business. We know that he is something of a banker or financier, but we are told nothing about the nature of his investments. Even if he has not been a creative entrepreneur himself, he has, presumably, been responsible for financing many successful enterprises, which have not only benef...

In a review for Ron Paul's latest book End the Fed , David Gordon gives a short and precise description of the boom-bust cycle (or business cycle, or trade cycle): Far from being a means to maintain monetary stability, as its supporters falsely insist, the Fed through expansion of bank credit bears primary responsibility for the business cycle. The expansion temporarily lowers the money rate of interest below the true market rate, largely determined by people’s time preference, i.e., their preference for present over future goods. Businesses, with money available, expand; but the new projects cannot be sustained. When the monetary expansion ceases (if it doesn’t, we will have hyperinflation, with disastrous consequences), these new investments must be liquidated. The process of doing so is the depression. Explaining this has been one of the greatest advancements in economic theory over the last century, yet too few understand it . Much more in depth analyses can be found here a...

As serious as the government wasting resources and abridging our freedoms is, it's important to sit back once in awhile, and have a laugh ( YouTube, 3m4s ):

It just so happens the day after I posted this Thomas Szasz article on the myth of health insurance, the FEE.org daily podcast discussed this very thing. It's about 25 minutes (.mp3) and features economist Paul Cwik. The podcast can be downloaded here .

It's not that hard to imagine "death panels". In fact, Oregon's got 'em! ( YouTube, 1m, 28s ):

I'd like to share two podcasts and an article on the fallacies surrounding our president's latest attempt to "reform" the health-care industry. It is imperative that we educate ourselves on this issue if we don't want to end up like Canada or Great Britain where hospital procedure wait times average 25 weeks and where only animals and people wealthy enough to travel to the US receive first-class medical-care. The first podcast is from the recent Mises University , held at the Ludwig von Mises Institute . It is a lesson given by Walter Block and is excellent. He explains things in terms everyone can understand. This podcast can be downloaded by right-clicking here , and clicking "Save link as". The second podcast and article are by the Foundation for Economic Education and feature Freeman editor-in-chief Sheldon Richman . The podcast can be downloaded like the above here . The article is the latest from Mr. Richman, found here . An excerpt: The New Yor...

The more I learn about libertarianism, the more I see what a big tent it really is . There's all different flavors like Limited-government or Anarcho-capitalist . I'm not quite sure where I fit in specifically, but what I do know is that I wasn't always a libertarian. Growing up, my father always talked about and voted for Democrats, as did my mother. I started to hear his views on things the older I got. I soon adopted them for myself. They were your typical liberal positions . After I was re-converted to my faith, got married, and moved out, I began reading a couple of columnists in my local paper, Thomas Sowell and Walter Williams. They wrote about economics and caught my interest. I bought Sowell's Basic Economics and began studying the subject. I fell in love with it. As I learned more about good economics and bad, I began taking a conservative position on government fiscal and regulatory policy. I could actually see and understand the cause and effects of bad p...

Another succinct bit of wisdom from Anne-Robert-Jacques Turgot (1727–1781); this one on profit: It is this advance and this continual return of capitals which constitute what one must call the circulation of money — that useful and fruitful circulation which gives life to all the labors of society, which maintains movement and life in the body politic, and which is with great reason compared to the circulation of blood in the animal body. For if, by any disorder whatsoever in the sequence of expenditures on the part of the different classes of society, the [entrepreneurs] cease to get back their advances with the profit they have a right to expect from them, it is evident that they will be obliged to reduce their undertakings; that the amount of labor, the amount of consumption of the fruits of the earth, the amount of production, and the amount of revenue will be reduced in like measure; that poverty will take the place of wealth; and that the common workmen, ceasing to find employm...

In this interview, the late economist and Nobel laureate Milton Friedman gives sound argument for ending drug prohibition, known as the War on Drugs. I believe both his economic and moral arguments are strong and deserving of serious public discussion, as I've tried to promote on this blog . The interview ( 7m, 56s, YouTube ):

The Mises Institute has created a fantastic resource on our current economic woes called the Bailout Reader that gives you everything you need to know about the economic/political cause and effect of it all. Everything is organized into these nine sections: Fannie Mae and Freddie Mac The Housing Bubble Inflationary Finance Community Reinvestment Act Short Selling The Austrian Theory of the Business Cycle Who Predicted This? What to Do Books to Distribute I've added this to my Suggested Reading section at the top of this blog.

This is a great lecture by the Rabbi Daniel Lapin at the recent Austrian Scholars Conference, held at the Ludwig von Mises Institute in Auburn, Alabama. He explores, in a very lively and entertaining way (he is Jewish, after all) what is morally right about economic freedom. That to exchange and make money is virtuous, and uses Judeo-Christian principles to make his point. It's about an hour long (including an introduction for the conference and for the rabbi by Joseph Salerno) but well worth it. As I said, it was very lively and entertaining, and for me, enlightening. (Embedded below, can be found here via YouTube.)

Anonymous made a short response to my last post : Skyler, I enjoy these exchanges as well. My only problem is, no matter what I or anyone else who disagrees with you says, we are always going to be wrong. I just have this feeling that if the economic stimulus plan was being presented by a conservative (though you will argue that would never happen), you would be praising the plan to high heaven. You can be rest assurred that your feeling is counterfeit. As a libertarian, (which you may not have read enough of my blog to have picked up) I first and foremost ally myself with liberty. Whether from the left or the right is irrelevant. I am not a liberal (in the modern sense) and I am not a conservative when it comes to public policy. I am a libertarian. I am also a subscriber to the Austrian school of economics. This is my reason for opposing the simulus, as I opposed Bush's stimulus last year (though I wasn't full-time blogging then). I view the rights to all freedoms, personal, e...

I have received a response by Anonymous to my response to his/her comment. I will post it below will my response in bold brackets spliced in: [I really appreciate you taking the time to post a comment. I enjoy the exchange.] Skyler,  The fact is that we are now in an economy where credit is frozen, banks refuse to lend money, and there is no incentive for anyone to spend. [Have you educated yourself on why the economy has gotten to this point? It's very important to understand the cause and effect of it all. The economy is in the mess it is in, not because of greedy capitalists, but because the foundation of our economy is fiat paper money care of our central bank, the Federal Reserve. Our money is not free-market, and our money is not guaranteed. This makes it completely unstable and prone to government manipulation. That is precisely the reason for our bust, and the preceding boom period. The Federal Reserve manipulated interest rates which sent a false signal to producers, there...

This post has a received a comment by an Anonymous poster and I want to it address here. The comment: Skyler my friend, you obviously have no concept of the purpose of the bill. EVERY SINGLE one of these so-called "pork spending programs" will create jobs jobs jobs and improve infrastructure. Yes, in a way it is sad our country has come to this. But, apparently there are people in the country who believe capitalism is only for the big-shots. The american people are not allowed to use their imaginations anymore because a select few have monopolized the entire economic structure of or country in the name of "capitalism." Come on. You're better than that. First and foremost, the poster has subscribed to an economic fallacy called the Broken-window-fallacy. That fallacy demonstrates the essence of looking only at what is seen and ignoring what is not seen. For example, as per the broken window example, when a barber's window is broken by a young hooligan's ...

"The Austrian approach to understanding what has happened to the economy holds far greater explanatory power than does any competing school of thought." So says Thomas Woods in his latest book, Meltdown . I received my copy two days ago and just completed it. In my opinion, everyone needs to read this book, and more importantly, understand Austrian business cycle theory. It's not difficult to understand and it explains exactly the reason why the economy has boom periods, followed by a bust period. Contrary to popular opinion, these periods are not inherent in a free-market economy. They are the direct result of intervention into the economy by the government, specifically a country's central bank. The Federal Reserve is the central bank of the United States. Numerous articles on Austrian business cycle theory can be found here and here on the Ludwig von Mises Institute website. For an introduction to the Austrian school of economics, and why it matters, read this es...

In this incredible video, Ron Paul is shown in several clips and quotes from the beginning of the decade predicting what is now upon us. It's unfortunate that our government continues in the error of their ways. For more on the Austrian school of economics of which Paul subscribes, visit the Ludwig von Mises Institute homepage. You will find a plethora of resources, dating back decades, calling for an end to the Federal Reserve system: The U.S. Economic Collapse

I owe a bit of gratitude to economist and intellectual Thomas Sowell for his awakening my senses to the field of economics. Not only was his the first book I read about economics (Basic Economics), but his others books were the first I read that challenged my theretofore understanding of the world. In promoting his latest book published in early 2008, Economic Facts and Fallacies , Thomas Sowell is here interviewed by Peter Robinson on February 21, 2008. They talk about such topics as the incomes of women, income levels, college tuition, and the misconceptions of Black America. I encourage you to both watch the interview and to buy one of his books the next time you're browsing around Barnes & Noble or Amazon.com. Uncommon Knowledge - Thomas Sowell - Fora.tv