Economics Discussion about Government intervention in a free market economy

[Carsten2012b]

Just thought you all here might be interested in our responses to the topic.

My response
"I believe that the government shouldn't be in the economy at all. I believe in a purely free market economic system. Central planning never works. Government can't plan the way an economy is going to run, it'll just end in an inevitable collapse. The economic problems we see in our economy is not because of the free market. It's because of government intervention. Before the Great Crash of 1929, America suffered several small panics, but they were quickly solved within a year or two. The Great Depression in 1929 however suffered more than a decade because of government intervention. When it comes to the regulation of the market, the government isn't needed for regulation. While the lesson makes some good points as to who some regulation is needed, it's regulation the market can do itself."

Responses to my post
"I know where you are coming from but I think the government needs to be involved in the economy a little bit. I agree that the government can make things a little worst at times, but with the government around, things can be fixed a lot more easier verses no government at all."

"I agree with what you are saying. But what do you think would happen now if we took the government out of the economy?

Edit: I take me statement back... I don't completely agree with what you are saying. you have some good points but i don't think it would work very well if the government completely removed themselves from the economy."

Other responses
"Economic freedom is a very tough concept to establish. Government in a sense should benefit some people over other, but should ensure that everyone is treated in the same fairness. Government regulation keeps people from playing the game the wrong way, but because of the fees that are needed to perform this regulation, then there becomes a big expense and waste of money. Government should be less involved, only by the circumstances of the technological improvements of today, that they should stop being lazy and dedicate the time and money to upgrade the system of regulation, to later create a less involved government, and a government that spends less time worrying about the economic situation."

"I believe the government is involved in the economy almost just right. The government isn't always trying to do something with the economy, the government only comes in when the economy looks down or looks like it needs growth. Therefore, the government is doing nothing but creating positive affects for the economy. The economy is in a slump right now and could be doing a lot better. I believe the government is benefiting the economy more than it is harming it. In addition, without a government, the people can't keep everything in line because there would always be someone trying to take over. "

[Travlyr]

People would be much more free, peaceful, and wealthy if they would simply implement your understanding of the economy.

My response
"I believe that the government shouldn't be in the economy at all. I believe in a purely free market economic system. Central planning never works. Government can't plan the way an economy is going to run, it'll just end in an inevitable collapse. The economic problems we see in our economy is not because of the free market. It's because of government intervention. Before the Great Crash of 1929, America suffered several small panics, but they were quickly solved within a year or two. The Great Depression in 1929 however suffered more than a decade because of government intervention. When it comes to the regulation of the market, the government isn't needed for regulation. While the lesson makes some good points as to who some regulation is needed, it's regulation the market can do itself."

This is what people are taught in government schools and it is reinforced by Media.

Responses to my post
"I know where you are coming from but I think the government needs to be involved in the economy a little bit. I agree that the government can make things a little worst at times, but with the government around, things can be fixed a lot more easier verses no government at all."

"I agree with what you are saying. But what do you think would happen now if we took the government out of the economy?

Edit: I take me statement back... I don't completely agree with what you are saying. you have some good points but i don't think it would work very well if the government completely removed themselves from the economy."

Other responses
"Economic freedom is a very tough concept to establish. Government in a sense should benefit some people over other, but should ensure that everyone is treated in the same fairness. Government regulation keeps people from playing the game the wrong way, but because of the fees that are needed to perform this regulation, then there becomes a big expense and waste of money. Government should be less involved, only by the circumstances of the technological improvements of today, that they should stop being lazy and dedicate the time and money to upgrade the system of regulation, to later create a less involved government, and a government that spends less time worrying about the economic situation."

"I believe the government is involved in the economy almost just right. The government isn't always trying to do something with the economy, the government only comes in when the economy looks down or looks like it needs growth. Therefore, the government is doing nothing but creating positive affects for the economy. The economy is in a slump right now and could be doing a lot better. I believe the government is benefiting the economy more than it is harming it. In addition, without a government, the people can't keep everything in line because there would always be someone trying to take over. "

Sound monetary policy is not being taught in any school system yet, is it?

[fisharmor]

Hey, that reminds me, I still have to call my bank to verify that they voluntarily removed the 90 dollar charge from Luxembourg on my account that I didn't charge and that government completely failed to prevent.

It also reminds me that I need to check my spam folder on my Yahoo account because I'm expecting responses from craigslist listings, and Yahoo's voluntary and free spam filter, which makes up for government's utter failure to deal with spam, actually works TOO well sometimes.

[Carsten2012b]

Got a new response just this morning. At least someone agrees with me:
"I agree with you, I feel that government needs to just kind of get out. They are not helping us right now, and we have a failing economy because of it. Well done."

And another post that was posted yesterday:
"You make a lot of good points, but you did state that the economy would just end in an inevitable collapse. Regardless of whether the government decided to help, the economy would have crashed. So can you blame the governments intervention for the suffering of the Great Depression if it was inevitably going to crash? A market cannot regulate itself because without an enforcer it leads into the state that the black market is - illegal products."

[fisharmor]

So I hope you offer the two obvious counterpoints:
1) Name one economic crash that lasted longer than a year or two, resulted in >10% unemployment, and had no government intervention to prevent it.

2) Illegal products are only illegal to begin with because they are regulated. You can't have a black market unless there is a law banning or heavily regulating goods or services. And prohibition is the most obvious example of why heavy regulation doesn't work: Alcohol is legal, everyone is fine. Alcohol becomes illegal, Chicago turns into Mad Max. Alcohol becomes legal again, everyone is fine again.

[Carsten2012b]

Thanks fisharmor, hope to hear a response on the discussion Had to really LOL today about a section of the lesson talking about the Federal Reserve.

An part of the lesson:

Congress created the Federal Reserve System (a.k.a. the Fed) in an attempt to stabilize the nation’s banking system. Yet it is considered a private institution, so it is relatively free of government control. But it serves the public—that’s you and me.

[acptulsa]

Sound monetary policy is not being taught in any school system yet, is it?

They do. But the long and the short of it is William Jennings Bryan's fearmongering 'Cross of Gold' speech. They teach that wealthy manipulators affected the real value of gold, thus screwing up the economy. They don't teach that people who kept their gold made out all right in the long term, because gold never went down in value without coming back up. And they sure don't teach that this 'elastic money' is completely controlled by the same sort of manipulators--thus the 'bubbles' that have been causing us such hardship.

[Travlyr]

They do. But the long and the short of it is William Jennings Bryan's fearmongering 'Cross of Gold' speech. They teach that wealthy manipulators affected the real value of gold, thus screwing up the economy. They don't teach that people who kept their gold made out all right in the long term, because gold never went down in value without coming back up. And they sure don't teach that this 'elastic money' is completely controlled by the same sort of manipulators--thus the 'bubbles' that have been causing us such hardship.

People who did not turn their gold in to the "authorities" in 1933 made out like "bandits", along with the "government bandits" when the government raised the price from $20.67 -> $35. They almost doubled their money overnight. Sometimes civil disobedience pays handsome rewards.

The Executive Order Of 1933 Which Called For Gold Confiscation
It was not even a month later that President Roosevelt exercised his new rights. On April 5, 1933 the President issued executive order No. 6102, also known as the 1933 Gold Confiscation. This Executive Order resulted in...

1. A Declared National Emergency, which the just passed Emergency Banking Act gave the President at his own discretion to declare a national emergency for any reason he wanted.
2. Made the hoarding of gold (Any Gold worth more than $100.00 per person) whether it was in Gold Coin, Gold Bullion or Gold Certificates in the United States either by individuals, partnerships, corporations and associations prohibited.
3. Forced everyone in the Nation to hand their Gold over to the Bank for only $20.67 per troy ounce.
4. Made it a criminal offense for any individual who was found in Violation of this order.(including private citizens, and officers, agents or directors of corporations that knowingly violated any part of the executive order): $10,000 fines, 10 years in prison, or both.

Not all coins were included under this order. Almost everyone was required to turn over their Gold in exchange for a Fiat Currency. If the Gold Coins were considered Rare or Collectible they would not have to be relinquished.

Then What Happened?
Once the Gold was effectively confiscated from the People and was illegal to own. The Government raised the Value of Gold for International Transactions from the price paid to the people of $20.67 per troy ounce to $35 per troy ounce.

[Bossobass]

As long as government spends trillions more than they take in, it will be grossly distorting the economy.

Those trillions would be available to the entrepreneurs who built this economy, instead of being vacuumed into the black hole of weapons systems, which only encourages ways to stimulate their use so that more can be built at even higher profit to a handful of lunatics.

Amtrack: Americans subsidize every passenger to the tune of $35 each. Epic fail.

US Postal Service: Has lost 12 Billion in the past 10 years. Epic fail.

Medicare/Medicaid: Has grown faster than the US economy for 40 years and is posting deficits equal to 8% of GDP. Epic fail.

Defense: When all defense spending, including those amounts hidden in other departments, is added up, it costs a trillion USD a year. In 2001, it was announced that $2.3 trillion USD "went missing" in the Pentagon budget alone. The next day 911 happened, due to the epic fail of US defenses.

War on Drugs: Resulted in the largest prison population in the world at a cost of $47,000.0 per year per inmate, a number that increases every year. Drug use has increased every year since the War on Drugs was "declared".

Education: Since the Department of Educations inception, the US has fallen from #1 in the world in basic educational skills to #18, with from 1 in 4 academically gifted students to less than 1 in 10, and has spent a trillion dollars on this epic fail.

The list goes on. Thinking that the results have been or ever will be different regarding the economy would fit the definition of insanity.

[Carsten2012b]

Laughed pretty today with this quote from my economics lesson. No doubt its pro Federal Reserve/Fractional Reserve Banking/Keynesian Economics.

"The Fed's goal is to increase the money supply just enough to keep up with the growing demand for money. By doing this, the Fed ensures that there is just enough money in circulation but not so much that it decreases its value. "

Laugh it out fellas...