Cage Match #2: Eurocrats, Nations, and Individuals


Up next, we have the international money, competing with the European federal state, competing with individual European nation-states, competing with European individuals themselves. Ostensibly, Eurocrats (including the ECB) and international banks like the IMF want to work together. Lately, they have been, owing to the fact that Greece looks like a pressure point in the yet-to-crack glass flag flying over Brussels.

Tsiparas, in one corner, is a communist running a government that has been entangled in federalist European policies for several years running now. In the opposite corner is the creditors that have their fingers in the EU; in any sense the reader might imagine. Mario Draghi has been thrown into the tough spot of both trying to print money fast enough to keep the Eurozone afloat while being the neoconservative IMF’s deficit hawk. Of course, Draghi has become small potatoes these days. Lagarde has just now become comprised of similarly diminuitive potatoes herself, as the human calculators with green visors are now overseeing the new-school monetarist “save the state as easily as possible” mentality. Indeed, the IMF owes its existence, as does the BIS and World Bank, to government-printed fiat currency. This is a crucial point not to be overlooked.

In the third corner of the ring is the individual: not the Greek individual, not the German individual, not the European individual, but the individual in its most raw sense. In the eyes of the troika, the Greek state borrowed money under now-known false pretenses that it also knew it could not repay. Did Greek individuals support this? Yes, as the recent OXI-Clean majority shows of the contents of their skulls. But what if you were an ancap that lived in Greece?

Think about it. The Greek anarchists want more government money because they are ancoms trying to hack a dying system. However, what of the free-marketeers, the classical liberals, the libertarians, the rugged individualists? What if you never even once consented to state control of your income, even at the national level? How would you feel, then, when the EU came after your sovereign government that has already been fucking you over, only in order to come after the socialist policies that barely keep you afloat in an already-manipulated state-plagued market? Furthermore, what if you hold a quarter century in age and work full-time in a productive industry while watching the crappy state edifice weaken and collapse in such slow-motion that there is no definable beginning or end, all the while not collecting a single dime from le etat’s thieving programs? Does this remind you of anyone?

What happens when these international bankers, created and propped up by governments, decide that the USA has too high of a debt-to-GDP ratio? Realistically, Greece has little deficit burden when one considers the rates on its restructured loans and such. The United States has a massive deficit burden, however, it is one that is financed by its own fancy American Printing Press™. We have home-grown communists too, Greece, but they are friends with the international banks that statists mistake for “neoliberals” which are apparently the same as “classical liberals” but not themselves deserving of the holy title of “liberal.”

Pedantry aside, who among us would want to be a citizen of the Greek state? What individual incentives affected the Greek political system? Everyone always bandies about the line from David Stockman that “democracy has been killed in its birthplace.” I suppose if I were a statist but a practically-minded individual, I’d have voted for Syriza merely to kick the can (and get my assets out, something Greek individuals forgot to do). If I worked at a Greek bank, I’d have done the same. If I worked at the IMF, I’d simply shower money on Greece; print money and dump it in there.

It makes one wonder: is the IMF turning Wicksellian? Are there really no atheists in foxholes, or are there no mountains when one is a deist? Wicksell himself was a statist, but he had ideas of general equilibrium in interest rates sans state intervention. He took this and formed a further postulation that technological advances in consumption and investment can be assymetrical and cause problems with steady growth in general output owing to intertemporal discoordination. It sounds Austrian until one realizes that Wicksell himself, in strange agreement with Lachmann, thought that there was no long-run equilibrium to be found between investment and consumption, with a state or without. Lachmann was doubtful but hopeful about these prospects, as was Wicksell, himself a classically-educated microeconomist.

Can the Eurozone survive? It is an amalgamation of conflicting overseers, states, markets, individuals, agreements, tenacities, and aversions. Each of them has made technological advances (and backtracks) in their capacities to consume and invest. Here I provide Lachmann:

I would agree with a view Hicks has expressed in his paper, “Some Questions of Time in Economics” in the Georgescu-Roegen essays. The most important problems are problems of market structure and certain problems of the effect of technical progress on the capital structure and on the economic structure as a whole. I suppose it doesn’t need any great emphasis that if Austrians stress the market process as the central economic process they should take some interest in the way in which the market functions in various parts of the system and in particular in the way in which different markets function. We have learned for instance that there is a difference between asset and commodity markets and that in some markets expectations are more important than in others. All this I think should be developed further, including, of course, the problem of the forward markets, which as it were, has been thrown at us by certain prominent neoclassical figures.

The other is the problem Hicks has been trying to deal with, questions of technical progress in an economy in which most capital goods are durable and where the effects of technical progress only begin to show themselves gradually and only at first in some sectors of the system but not in others. Now this might lead to some revision of the Austrian trade cycle theory, the subject on which I have become somewhat skeptical. It still seems to me that Wicksell’s insistence that the trade cycle has something to do with the uneven rate of technical progress in different parts of the system was fundamentally a sound one. And I hope that Austrian economists somehow will find a way to incorporate such views in the Austrian trade cycle theory. As it stands, of course, there is no reference whatever to technical progress. But it is surely clear that in the real world it does matter.

an interview with ludwig lachmann: austrian economics newsletter, vol.1 no.3, 1978

Strangely, right-wingers are caught arguing for communists that are fighting businessmen while left-wingers are caught rooting for national sovereignty and banking stability. Chew on that for a while. As well, if you are interested in Lachmann and would like a copy of the transcript of the above interview in full, I have a copy that is only otherwise hosted at a single site on the internet, so feel free to contact me. In the meantime, pray for a Graccident, as Stockman says: it will signal the end of the totalitarian moneyprinting regime that manipulates and controls the lives of every individual on this planet.


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