4. IS IT POSSIBLE TO UNDERSTAND ECONOMICS?

 

“They” – the super rich people who control banks and governments – want you to think that economics is very very complicated and difficult to understand.  That’s because “they” don’t want you to know what they are really doing.  “They” want you to be ignorant and confused and trusting and gullible.

 

The following four principles of economics are necessary and sufficient to understand economics and to create a prosperous economy.  Each one of them is very simple to understand and very simple to apply.  Apply all four, and you will get prosperity.  Leave one out, and you will not.

 

#1.  THERE SHOULD BE NO STEALING THROUGH GOVERNMENT.

 

The Eighth Commandment of the Biblical Ten Commandments says, “Thou shalt not steal.”.  This is a good rule.  But people do not generally recognize that if the government takes money from one person or company and gives it to another person or company, that is not a voluntary trade or a gift, and therefore it is a form of stealing.  In effect, this commandment has been revised to say, “Thou shalt not steal except by majority vote.”.

 

Suppose three guys are stranded on a desert island.  One guy does all the work to provide food and shelter.  The other two loaf.  Then they form a “government”.  Then they pass a “law” which says that what the one worker produced belongs to the two loafers.  How do you think the worker is going to feel about that?

 

Money is just paper and ink.  So the government really can print up an infinite quantity of money.  But money is not wealth.  Wealth is the good things in life that one can have and enjoy.  No matter what the government does with money, the government never produces any of the good things in life.  It can only take good things from one person and give them to another.  It normally does this by taking money from one person and giving it to another.  But no new wealth is created in this process.  It is only taken from one person and given to another.

 

People do not distinguish between money and wealth.  They observe correctly that the government can print up all the money it wants.  So they conclude incorrectly that the government can give infinite wealth to everyone.

 

The Founding Fathers fought for the rights to “Life, Liberty, and the pursuit of Happiness”.  They did not fight for the “right” to be taken care of by the government.  When enough people demand the “right” to receive wealth from the government, then the government has to take that wealth away from the remaining people who support themselves.  Liberty goes out the window for the remaining workers.  They are enslaved by the majority vote of those who demand something for nothing.

 

#2.  GOING INTO DEBT IS BAD.  SAVING AND BUILDING UP RESERVES IS GOOD.

 

This applies to individuals, to businesses, and to governments.  Debt is when you have not paid for something yet.  The plan is that you will pay later.  You are getting something for nothing now, plus you are getting an obligation.  Thus debt is partial slavery.  If you have large debts, that’s debt slavery.  The purpose of bankruptcy laws is to allow people to escape debt slavery, when they have poorly managed their finances.

 

The federal government loves to go into debt.  Debt makes it possible for them to give money to people and spend money on many things, without having to get the money first through taxes.  This helps create the illusion that the government has an infinite supply of money.

 

The Central Bank (the Federal Reserve) can print up an infinite supply of money, and then they “lend it” to the federal government.  So in effect, the government really does have an infinite supply of money.

 

The famous economist John Maynard Keynes was the foremost advocate of government debt.  “Keynesian economics” is all about how wonderful and beneficial it is for the government to go into more and more debt.  That’s what “they” want you to believe.  But it’s not true.

 

The Chinese are doing it right.  They are selling stuff around the world, especially in America.  They are salting away trillions in reserves.  And they are spending their honestly acquired money buying up everything in sight, especially American real estate and corporations.  This is not good for America.

 

One of the things that encourages debt is the way banks operate.  They get your money which you deposit in the bank.  Then most of it they lend out to somebody else.  That person puts it in the bank.  And most of that gets lent out again.  And so forth.  This is called “fractional reserve banking”.  If nobody borrows, the banks don’t make any money.  So the system is rigged to strongly encourage very large quantities of debt.  This is a bad thing.

 

#3.  THE QUANTITY OF MONEY SHOULD BE STABLE.

 

The total quantity of money is how much money everybody everywhere has all added up together into a grand total.  There are complex details about exactly how to do this.  But the details are not important.  The concept is extremely important.

 

If everybody has lots of money, then they are willing to pay more for things, because they have more.  So the sellers will ask for a higher price and get it.  So you get the basic rule.  If there is more money, prices will go up.  That’s called inflation.  Central Banks are the cause of inflation.

 

That’s why Central Banks are so bad, and in particular the American Central Bank, which is called the “Federal Reserve System”.  The Central Bank makes it possible to create an infinite total quantity of money.  The Federal Reserve prints it up.  And the government “borrows it”.

 

For us ordinary people, if you have more money, you have more wealth, because you can go out and spend the money buying things you want.  But if everybody has twice as much money, and if everything costs twice as much, then it all comes out the same.  There was no change at all.

 

Money is not wealth.  Wealth is the good things in life that you need or want.  The government can print up an infinite amount of money.  But that does not create any wealth.  If we are going to have more wealth, then somebody has to get busy and actually make more of the good things in life that people need and want.

 

The first great evil of Central Banks is inflation.  The second great evil of Central Banks is the cycle of boom and bust.  Some variation in business activity is natural and not a problem.  But huge booms and busts are caused by the Central Bank.  When the quantity of money is increased more than usual, businesses get very busy and we have a “boom”.  Then when the quantity of money is decreased, or increased less than usual, businesses slow down and we get a “bust”.

 

But what really makes a “bust” is when you combine the business slowdown with high levels of debt.  If there were no debt, businesses would slow down, and it would be no big deal.  But instead, individuals and businesses have run up high levels of debt, so things have to keep going at the same level.  When business slows down, income goes down, but debt payments stay the same.  The result is bankruptcy and hard times for many individuals and businesses at the same time.

 

The really evil part of this racket is that the insiders who are super rich and who control the Central Bank know in advance when these things are going to happen.  So then they can buy up the assets of all the bankrupt businesses for dirt cheap prices.

 

#4.  PEOPLE SHOULD BE ALLOWED TO WORK AND TO START BUSINESSES.

 

The vast complexity of taxes and regulations makes it extremely difficult to start a business, to hire people, or to find a job.

 

The most obvious demonstration of this is that almost no one hires personal household servants.  This used to be perfectly ordinary and routine.  Just think of how many people could do useful work in someone’s home, and perhaps get room and board, and make enough money to get by.  But the taxes and regulations involved are a nightmare that makes this all but impossible.

 

The second great manifestation of not allowing people to work and do business is that it is extremely difficult to start or even to continue a business.  So there are very few new businesses.  What should happen is that new businesses pop up all over the place.  These new businesses are eager to hire lots of employees.  This problem is not obvious because these new companies are not there.  There are so many laws and regulations and government bureaucrats who are supposedly “protecting us”, that it is extremely difficult to start a new business and make it work.

 

The great argument for welfare is that poor people cannot find a job, so the government has to take care of them.  But the main reason they can’t find a job is that the government itself makes it very hard for a businessman to make his company work so he can hire people.

 

UNDERSTANDING REQUIRES HONOR

 

The basic rule of property is that something belongs to the person who made it or who got it in a voluntary exchange.  Someone who feels this in his heart has “honor”.  That’s what “honor” is.  A man with honor wants to support himself.  He thinks other people should support themselves.  He does not steal.  He does not like it when other people steal.  In general, he does not like taking money from the government, although in some cases he paid money to the government which he is now getting back.

 

Politics often looks like a great confusion where everyone, rich and poor, is trying to get as much money from the government as he can.  This is a bad attitude.  This is an effort to get something for nothing.  This is not honorable.

 

Whether rich or poor, those who take as much government money as they can, without giving back, have sacrificed their honor.  They will not be able to understand these four principles.  They will be looking for explanations about why it is OK for them to get something for nothing.  They do not want to find out that their attitude is basically criminal.

 

In order to work, a free society has to be composed primarily of people who are willing to take care of themselves.  These good men take care of themselves and they are proud of this fact.  They frown heavily on people who live on government money.  They work hard to stay out of debt and to build up reserves.  They hate the evil trickery of bankers.  They want others to be able to take care of themselves, so they hate the excessive regulation which makes it extremely difficult to do business.

 

TAKING SOMETHING FOR NOTHING WILL DESTROY YOUR FUTURE

 

People are encouraged these days in many many ways to take something for nothing.  Unless you are in dire need, it is best not to do it.  And even then, you should pay it back when you can.

 

Taking something for nothing destroys society.  Civilization becomes a nest of criminals, where everyone tries to live by taking from everyone else.  Liberty dies.  All become slaves.

 

Taking something for nothing destroys the soul.  It makes you stupid, because you are trying to explain to yourself and to others why it is OK, when your conscience tells you it is not.  Your conscience dies.  Your happiness dies.

 

Evil men want to make other men evil.  So they induce you to destroy yourself.  Don’t do it.

 

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Comments

[Dale]

Testing One Two Three

[Ruby]

Hello Dale, This is a test to find out if I can post anything at all. If this work,s there may be an issue with maximum length of text? It looks like this one will work because right now the Post and Preview buttons are both activated; whereas, with my very lengthy commentary, both buttons are grayed out. Ok, here goes:))))

[Dale]

Testing Four Five Six.

[Dale]

Testing Seven Eight Nine.

[Diane McDonald]

I agree, totally, with the above principles. Governments all over the world are making their citizens dependent on them to manipulate and control them. This eventually ruins any society. A society controlled to such an extent can be wiped out because it has no more independence, financially.

Mr. Samson has hit the nail on the head. I recommend this site and book to everyone that believes in a free society.

Diane McDonald