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Archive for January 4th, 2012

Henry Hazlitt, 1894-1993

The following quote is from a current read that was given by our oldest in college to my wife last year at Christmas:

“When your money is taken by a thief, you get nothing in return.  When your money is taken through taxes to support needless bureaucrats, precisely the same situation exists.  We are lucky, indeed, if the needless bureaucrats are mere easygoing loafers.  They are more likely today to be energetic reformers busily discouraging and disrupting production.”

The quote is from Economics in One Lesson by Henry Hazlitt, first publishing in 1946 (!)and the latest revision by the author in 1972.  In a ‘gnosticized’/spiritualized Christianity in which the ‘real’ world is of no concern to Christians, the economy even seems to be dirty, but, for instance, Martin Luther had a lot to say about the economy of his time for instance, see The Large Catechism, the 7th commandment, You shall not steal.  And that’s the point of Mr. Hazlitt’s  prescient observation:  our federal government is huge with bureaucrats who are needless.  Mr. Hazlitt points out that there are needed public officials, such as, “…policemen, firemen, street cleaners, health officers, judges, legislators, and executives perform  productive services as important as those of anyone in private industry.” I wonder what the ratio is in the federal government of needed public servants to needless bureaucrats?

It is the second part of his observation from 1946 that is precisely prescient:  it would be better if they were goof-offs than reformers busily discouraging and disrupting production.  This could mean using government as a means of using our tax dollars for purposes that stop economic progress, e. g. home loans with no collateral which undermines legitimate banks (who are employers) and when there is a default on the risky loan we the taxpayer  pay for it.  Then those tax dollars for the useless bureaucrats salary packages, and their policies, take money out of the economy two-times that could be used for our saving or spending, thus boosting the economy and jobs and the like. Yes, true production is disrupted.

But there is more that maybe Mr. Hazlitt could not have foreseen but which his quote points us:  in our day and time,  busy reformers changing and enforcing social morals which are not conducive to many of us and our fellow citizens of many religious persuasions.  When the needless bureaucrats are enforcing abortion on demand, same-sex marriage, adoption by same-sex couples, socialist economic policies and the like, and plainly not answerable to the electorate or those whom we elected, the Congress, then we are paying someone for policies which we do not endorse.

Both of the above is a concern of an electorate informed and conformed by God’s Word, again see the 7th commandment.

Post-script:  I strongly recommend this book. Nowadays it might be called, Economics for Dummies!  Here is another quote from his 1946 book to whet your appetite:

THERE IS NO more persistent and influential faith in the world today than the faith in government spending. Everywhere government spending is presented as a panacea for all our economic ills. Is private industry partially stagnant? We can fix it all by government spending. Is there unemployment? That is obviously due to “insufficient private purchasing power.” The remedy is just as obvious. All that is necessary is for the government to spend enough to make up the “deficiency.”

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