From Bill Buckler, author of The Privateer [2]
How To Bend An Economy
Once a government becomes involved in “running” an economy, it invariably ends up running it into the ground. The only variables in this process are how long it takes and how prostrate a given economy becomes by the end of it. Because it always ends - sooner or later. Rational economic theory provides abundant proof of WHY this is the case. Economic and political history is absolutely unanimous in their verdict that it always DOES take place. There is no escape from this truth, no matter how many people wish it were not so and how fervently they ignore the evidence of their eyes and their brains.
It took a very long time to enshrine into law the separation of church and state. But it was finally recognised that religion is a matter for the individual “conscience” and that any interference with this is beyond the legitimate role of government. What has as yet been realised by very few is that the individual “conscience” is even more involved in the economic realm than it is in the religious realm. For that reason alone, the separation of economic action and state is equally important. It is impossible to prevent an individual from making choices. It IS possible to discourage or hamper or prohibit that individual from acting on those choices. A threat is usually sufficient, if the individual knows that behind the threat rests the outright use of force if he or she persists. But the INITIATION of the use of force by anyone is precisely what a legitimate government is set up to prevent - or at least to deal with if it occurs.
In the economic realm, ANY threat or exercise of the use of force to hamper or prohibit the voluntary interaction of individuals is guaranteed to inhibit the functioning of the economy. The extent to which force is used is exactly proportional to this inhibition. Once a government gets involved in giving PERMISSION for people to act or in PROHIBITING actions which do not involve the use of force, the economy starts to bend out of shape. The insoluble problem is that once regulation in an economy begins, it cannot go “just so far” and then stop. A government cannot prohibit one voluntary action while remaining aloof from all other possible voluntary actions. The fact of the matter is that any governed nation has two ultimate choices. It can be free - in a situation where the government is TOTALLY barred from interfering in economic exchanges. Or it can be strangled by a government which stands as an impenetrable barrier between choices and the actions necessary to convert them to the building of a free and therefore prosperous nation.
The global “crisis” is a faithful and exact picture of how far down this second road the world has come.