Thursday, 19 October 2017

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The Swinging Pendulum

Posted by
April 9, 2010
in Blog

On Monday, April 5, the Future of Freedom Foundation and the George Mason University Econ Society hosted a lecture1 by Dr. Richard Ebeling, professor of economics at Northwood University and former president of the Foundation for Economic Education. Dr. Ebeling is an excellent speaker, eloquent and motivated, and this lecture did not disappoint.

According to Dr. Ebeling, the 1930s-40s were a time of growing government control, intrusions and management. This time period gave rise to the New Deal in the US. While the U.S. remained suspicious of communism in the Soviet Union style, the nation had taken up the idea that markets fail. The Soviet Union had violent methods that the U.S. was hesitant to employ, but regulation seemed like a likely resource for controlling the economy and putting the nation on the path to greatness.   Command and control for the betterment of the society.

As Dr. Ebeling states, the U.S. “did not give up the Socialist critique of capitalism”, namely that it 1) is motivated by greed, 2) production is “driven by what makes property holders better off”, 3) capitalists use labor and that labor needs to be protected from abuse, and 4) capitalism uses short term thinking that destroys resources for future generations.

Since the fall of the Soviet Union in the 1980s, there seemed to be a growing trend towards market freedom, where the desires and interactions of individuals to determine the outcome of the economy. In that climate, we saw “the end of collectivism and tyranny”. The great experiment in central planning was shown to be a failure.

Yet the trend has reversed itself in the past few years. As Dr. Ebeling argues, we have seen the command and control arguments pushed back to the fore. We are at risk of returning to Central Planning and the Road to Serfdom. The government has decided to massively intrude into healthcare (more so than t already had), to regulate the so called “market failure” of the financial crisis and to return to the use of Keynesian policies that many had thought outdated after the 1970’s. Banks and the auto industry have fallen under direct ownership of the government, moving us back towards those policies that were shown to have disastrous outcomes decades earlier.

Dr. Ebeling implores those of us who would see the pendulum swing back towards economic and political freedom to act. He says that the task of those who believe in liberty is to debate, discuss, teach, argue and write, to spread the ideas of freedom to those who have forgotten their appeal. We should confront those who lay blame where it is not warranted and who seek to extend the power of government into places where it is not necessary and in many cases harmful. How does one change the world? As Dr. Ebeling puts it, “One mind at a time.”

Tom Duncan
Sound Money Fellow
Atlas Economic Research Foundation

1 – The Future of Freedom Foundation posts its lectures online. I recommend checking their site and watching Dr. Ebeling’s lecture for those who could not be in attendance.