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Response to Tansy_Gold (Original post)

Tue Oct 30, 2012, 02:15 AM

6. The Dark Age Of Money by James C. Kennedy

 

http://www.zerohedge.com/news/2012-10-25/guest-post-dark-age-money

If you often wonder why ‘free market capitalism’ feels like it is failing despite universal assurances from economists and political pundits that it is working as intended, your intuition is correct. Free market capitalism has become a thing of the past. In truth free market capitalism has been replaced by something that is truly anti-free market and anti-capitalistic...Beginning sometime around 1970, the U.S. and most of the ‘free world’ have diverged from traditional “free market capitalism” to something different. Today the U.S. and much of the world’s economies are operating under what I call Monetary Fascism: a system where financial interests control the State for the advancement of the financial class. This is markedly different from traditional Fascism: a system where State and industry work together for the advancement of the State.

Monetary Fascism was created and propagated through the Chicago School of Economics. Milton Friedman’s collective works constitute the foundation of Monetary Fascism. Knowing that the term ’Fascism’ was universally unpopular; Friedman and the Chicago School of Economics masquerade these works as ‘Capitalism’ and ’Free Market’ economics. The foundation of Friedman’s corrupting principle is that the investor (money to be more precise) has no duty, obligation or covenant to anyone or anything. Friedman’s ‘Market’ is not subject to ‘any’ human standard of morality, political limitations or national interests. Money is free to act without bounds or conventions. Nothing is prohibited as long as the market can provide a “clearing price”.
The fundamental difference between Adam Smith’s free market capitalism and Friedman’s ‘free market capitalism’ is that Friedman’s is a hyper extractive model, the kind that creates and maintains Third-World-Countries and Banana-Republics, without geo-political borders If you say that this is nothing new, you miss the point. Friedman does not differentiate between some third world country and his own. The ultimate difference is that Friedman has created a model that sanctions and promotes the exploitation of his own country, in fact every country, for the benefit of the investor, money the uber-wealthy. He dressed up this noxious ideology as ‘free market capitalism’ and then convinced most of the world to embrace it as their economic salvation. As improbable as it sounds, this ideology has the near-universal support of most economists, the media, universities, the Federal Reserve, the U.S. Treasury, nearly every member of The U.S. Congress and most everyone you know. Today Friedman’s ideology is accepted, to some degree, by nearly every country in the world. But ultimately this exploitive model is not sustainable at any level, or for anyone or any nation.

The ultimate difference between Friedman’s ideology and Smith is simply this: Smith was in fact a Mercantilist. True, he opposed the custom of hoarding gold and other Mercantilist practices, but ultimately he was a Mercantilist. Smith promoted “free trade” with the goal of improving the English merchant’s advantage, and thus the State’s. Nothing expresses this more clearly that the title of his book An Inquiry into the Nature and Causes of the Wealth of Nations. Mercantilism is based on the relative wealth of one Nation State over the other, not the plunder of the State and its peoples for the benefit of the individual. Smith believed in the power of the State and recognized that it was only by the power of the State that free enterprise could succeed and thrive. In a world without the State, he sided with Lock, “life was brutish and short”. Consequently one had obligations to the State and the people who make up the state: the working man. According to Smith every butcher, baker, craftsman and merchant would seek out his own self-interest and that economic advantage would ultimately benefit his fellow Englishman and the Crown. Smith’s arguments against some precepts of Mercantilism were intended to give the English tradesman a greater advantage, nothing more. The intended effect was to enrich one’s State above all others as an alternative to the primitive act of war, the traditional means to National enrichment. Smith viewed things as a zero sum game. And as England was the undisputed master of global exploitation at this time, exploitation of other Nations was fair game...Free market capitalism, as conceived by Smith, was Nationalistic in nature and as the Nation State became wealthier, so did its people and industry. This relationship required shared obligations and shared rewards between the State and its people.

Traditional Fascism, as conceived by Mussolini or Hitler, had an aggressive Nationalistic disposition where the State promoted Industry above all others in order to strengthen the State relative to its perceived rivals. Hitler and Mussolini believed that as the State lifted industry, industry lifted the people – dignity and pride in one’s nation were foundational principles...Monetary Fascism, as conceived by Friedman, uses the powers of the state to put the interest of money and the financial class above and beyond all other forms of industry (and other stake holders) and the state itself. In democracies and first world nations this is achieved through lobbying, campaign donations, financial incentives, revolving door regulators and through other means. As such, the state is co-opted into altering regulations / legislation, diverting investigations / prosecutions or creating tax loopholes for the benefit of the financial class/ industry. Ultimately these actions undermine state's sovereignty...For the rest of the world state interests and sovereignty are undermined through the IMF, The World Bank and other global monetary agencies. Monetary Fascism has a strong preference for political rather than capital investments. These investments are designed to sustain and support the preferences and activities of the financial class as it manipulates and create ever larger out-sized rent opportunities or constructs risk-diverting transactions that aggregate a ‘risk-arbitrage premium’ to one side of a transaction and transfers all future losses to the other...

AND THE REST IS HISTORY...MUCH MORE DETAIL AND DESPAIR AT LINK

I'LL LEAVE YOU WITH HIS CONCLUSIONS:

...consider what Friedman’s ‘free market’ banking system has done to Iceland, Ireland, Spain, Greece, Estonia, etc. How many western nations has Islam overthrown? Not one, and by comparison that should scare you...The predictable long term outcome is a steep decline into a very dark Monetary Feudalism. When asked in an interview what humanities’ future looked like, Eric Blair, better known as George Orwell, said “Imagine a boot smashing a human face forever.”

Welcome to the Dark Age of Money.

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