A person comes into a doctor’s office not feeling well. The doctor diagnoses an upset stomach. He prescribes a daily dose of arsenic to his patient, telling him that he will start feeling well soon.
That’s what U.S. officials have done with their shutdown of businesses and industries across America. Faced with the massive adverse consequences of their dysfunctional centrally planned healthcare system, U.S. officials have resorted to the same sorts of measures their counterparts in communist China have resorted to, including massive violations of civil liberties and mandatory shutdown of people’s livelihoods.
One of the big consequences of all this dysfunctionality is that 22 million Americans have filed for unemployment compensation, with almost 6 million being added onto the list in the last week alone.
According to the Washington Post, “The United States has not seen this level of jobs since the Great Depression.”
Needless to say, millions of Americans are struggling to survive this mayhem. Amanda Fleming and her husband own a tree-cutting business in Virginia. Since they are self-employed, they don’t qualify for unemployment compensation, at least not yet. Some of their contract workers have called them asking for financial assistance, but the Flemings are not in a position to help. They just borrowed money from family members to buy groceries.
This type of thing, of course, is going on all across the country.
Just keep taking the arsenic. You’ll start feeling fine soon.
Our federal daddy
Needless to say, millions of Americans are counting on the federal government to come to their rescue. And why not? Hasn’t that been the job of the federal government ever since the Franklin Roosevelt administration in the 1930s? Wasn’t that why FDR converted the federal government into a welfare state? Isn’t that why people have come to look on the federal government as their daddy whose job it is to take care of his adult-children.
Frederic Bastiat, the French libertarian thinker in the 1800s, pointed out an important truth about government’s role as people’s daddy, a truth that Americans have been loathe to confront ever since the FDR administration. Bastiat wrote that the government is nothing more than a fictitious entity by which everyone tries to live at the expense of everyone else.
Contrary to what is taught in economics classes in public schools and colleges across America, government is not like just another business in the marketplace. Private businesses get their money by providing goods and services that other people pay for. Government gets its money by seizing a part of the money that people are earning in the marketplace.
Thus, if a few people within a state go unemployed, the idea is that the state government will tax everyone else and give the money to those unemployed people, after deducting a certain amount to pay for providing this service.
But what happens when most everyone within a state seeks unemployment compensation? What happens when the state is unable to seize enough money from other people to pay for those claims? Should the state tax everyone, say, $12,000 and then start paying them $1,000 a month for a year? My hunch is that most everyone would be able to see through that scam.
Enter the federal government. It’s going to be people’s savior. It will come to the rescue by giving the state governments all the money they need. Isn’t that just wonderful?
Oh, don’t forget: Our federal daddy is now sending people a free check for $1,200. Isn’t that magnificent and compassionate? I’ll bet the rest of the world wished they had a rich political daddy like we do.
Except for one thing. Where is the federal government getting that $2 trillion in so-called stimulus money? Nobody in Washington or within the mainstream press is eager to address that question. Before the coronavirus crisis, everyone was talking about how broke the U.S. government was and how deeply in debt it was in. The feds now owe $24 trillion. Even before the crisis, their expenditures were exceeding their tax revenues by $1 trillion a year.
The Federal Reserve
So, where is our political daddy getting that $2 trillion in free money that it is sending the American people? The feds certainly haven’t raised people’s taxes to get the money. And we know that they didn’t have that $2 trillion hidden under their bed. How is our federal daddy performing this fantastic magic act?
Enter the Federal Reserve. Its printing presses are now working 24/7. It is printing money like it was going out of style.
Oh, sure, it all looks free. Americans are now receiving those $1,200 checks and thanking their lucky stars for having such a rich, generous, and compassionate federal daddy.
That’s because they don’t understand the nature of the scam, a scam that the Federal Reserve has been engaged in ever since it was established in 1913. The massive printing of money constitutes a massive debasement of the currency. The consequences of that debasement will come just as sure as thunder follows lightning. When Americans are dealing with ever-increasing prices that massively reduce the purchasing power of their income and assets, they will see how their political daddy performed that magic act with all those free $1,200 checks — through the surreptitious confiscation of their money through monetary debasement.
Three inherently defective systems — economic, healthcare, and monetary — all coming together at the same time in a perfect storm of death, suffering, impoverishment, and destruction of liberty.
Just keep drinking the arsenic. You’ll start feeling fine soon.