(45 People Likes) Why do many Libertarians dislike fiat currency?
on.)
Let me share my biggest objections.
1. Theft of Labor (a.k.a. Inflation)
Imagine that your labor is valuable enough that you could trade 100 hours of your labor for a seven day sailing vacation in the Caribbean.
But, it’s hurricane season so you don't want to go there right now. Instead, you get these green chits, called currency, which are redeemable at any time for seven luxurious days sailing down Sir Francis Drake Channel and snorkeling with turtles, and you stuff them into a suitcase under your bed.
(Let’s assume everything in the economy stays the same, except that your rulers print out more green chits …)
Youcome back when it’s time to pack up your flippers and try to redeem your currency for seven days off of Tortola.
“Oh, so sorry!” When you contact the charter company, you find out that your labor, which you had expended in exchange for seven warm days, turns out now to only be worth six days and 21 hours.”
This irritates you. You could go back and work some more to bring your currency up to seven days, but, you have to run so you just truncate your trip to six days.
2) Sneak Thief (Wrong Culprit)
All flight, you’re fuming. You don’t know what really happened. All you know for sure is that somebody ripped you off, man, and you’ve been reviewing the evidence.
“Maybe it was my roommate. How did she get the money to buy her new dress?
“Or maybe it was my boss. That jerk!! We agreed to seven days, and he only gave me enough for six!!
“No, it was the charter company! Raising its prices just to rip me off.”
And so, as you board the ferry in Saint Thomas, you can’t even hear the reassuring steel drums playing “No Woman No Cry”. You’re too angry with the world.
“I hate capitalism!!!”
3) Taxation without Representation
But, their inflation was a hidden tax on you. It was your fine government stealing your money, even as your money just laid there waiting for when you could go.
You had already paid your income tax. You were still going to pay your sales tax, and all the other niggling charges and taxes they extract from your labor.
But they had one more way to steal your labor — without you even knowing. Heck, their government schools proactively train you to think that it’s inherent to ‘capitalism’.
And so, unless you’re a libertarian, it’s likely you’ll never guess who the thieving culprit was; let alone stand up to them.
Which means they’re going to do it again…..
4) Evil Uses (Government programs)
Now, had it been your roommate, she would have simply bought her dress, and it wouldn’t have hurt other people or done any (more) evil in the world.
But it’s government. It uses violence and theft to steal your labor because most of us would not consent to give them our labor for most of the evil and wasteful stuff they do.
So, when they sneak-thief your money, they’re going to use it on something horrifying, and even while you try to relax with your pina colada, a shadow falls on the deck as you hear the news how your labor was spent — in your name — without your consent.
“It’s a dangerous world,” you worry with your shipmate. “They have to do something!”
5) Counterproductive and Blowback
Even though the whole purpose was to relax, as soon as you reenter the country, you would notice (if you were a libertarian) that their counterproductive use of your labor has made you less free.
And after being violated in a way that is usually reserved for their government prisons (which you are forced to pay for as well), you’re just not relaxed.
“Fat cat airlines!” you fume as you try to remove the vaseline in the men’s room.
And the “See Something? Say Something!” poster reminds you that it is your rulers who keep you safe.
6) Malinvestment
And you sure could have used that relaxation, because your first voice mail is from your boss: No longer will you be the principal programmer of the “Mother May I” line of dolls. Your entire division has been purchased by Halliburton to program drone strikes.
You see, the inflated money the government counterfeits does not enter the economy evenly. Your rulers give it to their crony friends first. And with these inflated dollars, the cronies suck up enormous resources, distorting the entire economy.
It corrupts the price mechanism of the free market by incorrectly signaling a gigantic shift from children Anime Sex Doll s toys to mass murder machines, and so, not realizing why, you trade your Birkenstocks for Oxfords.
“Corporate greed,” you sniff as you open your briefcase for your turn at inspection at the entrance of your new workplace.
7) Business Cycle
Before it’s time for your next vacation, your ruler-captured media is explaining that a “business cycle” has occurred <”Oooo!”>, and that’s why you and all your programmers are laid off <”Ohhhh!”>.
Remember that distortion in the economy due to the inflated money going first to the cronies of the rulers? Well, the economy has caught up and is desperately trying to flush the malinvestment out, as any well-functioning free market must.
But what that means is all that investment and hirings and purchases — they weren’t made using free market information. They were made with ‘counterfeit’ (inflated) dollars. So, they do not correctly reflect the desired mix of products and services that the non-ruling class want. Any investments made with the counterfeit dollars must lose money as the free market tries to reassert its information function.
And you are part of the collateral damage.
“I hate free markets!” you mutter, straining with your box. “If only the government could stabilize this economy.”
8) Get Up and Do Again
So, you lose your home. You rent a place, using the remaining currency in the bank, which is losing value even as you breathe. You can’t find a job … until you hear about a new toy company starting up! How excited are you that you can finally get back to what you really wanted to do with your life…but…
… but … the government has a new Plan for A Brighter Future™, and so is inflating some more, distorting the economy again, and instead of a new toy company providing a toddler social network, you find yourself programming computers to spy on your neighbor’s phone calls, because the blowback from your rulers’ evil acts have even more people wanting to kill you.
“It’s the price of freedom,” you assure the cafeteria table.
9) Scumbags
Libertarians are not at all impressed by those rulers who have so much power over us that they can force us to use their fake currency. Sure, they’re powerful enough that they can steal from us to reward their crony friends, they can disrupt and distort our peaceful, voluntary trading, and they can inflict havoc and mayhem across the world.
And yet somehow, we libertarians still remain immune from their charms.
In fact, we think that — as a class — they’re probably some of the worse human beings on the planet. And so, giving them that amount of power over us seems crazy!!
And, that’s why we’re surprised that you think that we’re the ones who are crazy!
10) Cowardly and Violent NonCompete
To us, it’s pretty darn clear that something must be wrong for us with their system, because they won’t allow competition.
And yes, I’m aware that regular businesses don’t like competition either!
But these rulers, they use guns to stop competition. Which is pretty much the most effective monopolization force in the world.
11) Intrinsic value
Because, let’s face it. After all that they have ripped you off for, are you going to again trust the “full faith” and integrity of these politicians, mass murderers, criminal psychopaths, thieves, liars, ….?
Or might you eventually learn your lesson — even if you stubbornly continue to reject our vision of a peaceful, consensual, voluntary society — and you start to consider temporary storage of your labor in something that retains its purchasing value — at least a bit more than politics?
And that, threatens your rulers’ power over you — a power they derive from their monopoly fiat currency.
And that would be a crime they cannot allow to pass.
See related:
How does inflation cause recession?
Why do capitalist economies always have a boom and bust cycle?
How do subsidies misallocate resources?
How is money different from wealth?
If currencies are backed by governments, what are bitcoins backed by?
Is taxation theft or is it slavery?
Is taxation simply ‘rent'?
How is all government spending effectively a tax?
What impact would there be if the rich doubled their income by generating more money?
Why do increases in minimum wage not cause inflation?
Can capitalism exist without money?
How will the US fall?
Why is GDP not a good measure of the economic well being of a society?
What do libertarians think about the gold standard?
What economic law explains why the average prices for goods will continue to increase?
Would we get objections if the U.S. currency said "We don't trust God"?
Why do some people get so angry at libertarians?<
