Welcome to mcdowellnews.com. Skip directly to: our Keyword Search, Section Navigation, Content.

mcdowellnews.com - The McDowell News

HomeNewsEntertainmentSportsLifestylesOpinionCommunityWeather Online Tools Jobs | Real Estate | Shopping | Classified

Combs: A Saturday with the Mises Circle time well spent

fun, facts, friends and fine food

Related Links

See for yourself the amazing free stuff at the Ludwig von Mises Web site

By Britt Combs | The McDowell News

Published: October 6, 2009

About 200 people attended the Ludwig Von Mises Institute's "Mises Circle" conference in Greenville, S.C. on Saturday. As speaker Douglas French said, there's a limited number of folks who will skip a lovely Saturday cutting grass or watching the game, preferring instead to hear a professor talk about great depressions.

But the scholars of the Mises Institute are having less and less trouble filling seats at these conferences, as the current monetary and economic crisis shows no signs of abating, and as the government and the Fed seem bent on repeating all the mistakes that caused the last Great Depression to last well over a decade.

A few years ago, these guys were all plodding away at their various colleges and universities, writing books and articles and giving it all away from free via their group's Web site, generally ignored by their colleagues and government, for their unfashionable adherence to the work of economists Ludwig von Mises, F.A. Hayek and Murray Rothbard – the so-called "Austrian" school.

Now they are rock stars. All their predictions have come true, and the dominant Keynesian and Chicago schools are sputtering that no one – simply no one! – could have predicted the collapse that has taken the jobs, fortunes, homes and retirement savings of literally millions of Americans. Folks want answers and have lost confidence in government-sponsored economists like Mike Walden, who preaches nonsense about there being "two recessions, a production recession and a jobs recession" and blather that the industrial recovery is well under way, thank you very much, and jobs will eventually be restored to fill that industrial need.

If you build it someone somewhere will buy it, he is saying. Can the abysmal science have fallen so far into superstition that professors can no longer see the connection between consumer demand and industrial production? So it would seem.

But despite nonsense like that, the Mises scholars have set about the task of promoting the viable, proven alternative to Federal Reserve tyranny, an alternative that is American to the core, but so long ago outlawed most Americans have forgotten all about it: the gold standard, the free market and private property.

French discussed the ongoing debt crisis that is, despite White House and CNBC obfuscation, continuing to close banks at a record pace.

"Every Friday we see more and more banks closing," he said, "three just last night, in Minnesota, Michigan and Colorado. The FDIC moves in with yellow tape, senior management is interrogated. The FDIC funds another bank to take on the bank's debts and deposits.

"On Monday morning, the bank opens with new management and no one on Main Street knows or cares," he continued. But now the FDIC is having trouble finding banks to take over the failed bank. The only way they can do it is by entering into a loss sharing agreement: The new bank tries to collect on the failed bank's loans. If it can't collect, the FDIC will assume the loss.

There were 28 failures in 2008. So far this year, there have been 98 failures.

The losses in today's crisis are 25 times greater than those of the Great Depression, he said, both in inflation-adjusted dollar value and per capita.

Economics is a lot like law, in that it impacts everyone.

Have you ever been to a party with a bunch of lawyers? I have. Nice folks, good company, I grant, but I have personally never had a conversation with a lawyer who was passionate, even fanatical about justice for all and equality before the law. I'm sure there are some, but I have never encountered any putting it out there for free, so great is their passion for human rights. Austrian economists, though, have a missionary zeal and passion that in breathtaking to behold.

Writer Thomas E. Woods was the final speaker. On the strength of his bestselling "Meltdown" and appearances on C-Span, he has become a leader in the war against the Fed. He spoke of how gold came to be used as a substitute holder of value in barter exchanges, saving the seller of a good from having to tote around cattle in his pocket. In other words, gold acquired the properties of money gradually and by universal, mutual acceptance on the free market.

Paper money, on the other hand, was forced on the people under threat of violence by the government. No people anywhere at any time, said Woods, have ever accepted paper money voluntarily.

Gold is preferable to paper in that the government and the bankers can't manipulate it, no matter how badly they want to. No gold-based currency has ever become worthless. What's more, he added, even if the value of gold falls on an isolated, local basis, it recovers. A paper money, by contrast, once it becomes worthless, never recovers any value whatsoever.

Even if the South rises again tomorrow, your Confederate dollars will still be worthless.

In an age where gloom and doom government hacks and bankers continually insist the surrender of all our freedom and property is the only way to save America, it was refreshing and inspiring to be in a room full of folks who believe America's best days are ahead of us, if only we will give up our lousy, crooked, treasonous leaders.