Moving to a gold or silver standard is critical for the stabalization of economy, but in the end why? It is to spur on entrepreneurs. We know that the profiting of any country lies in the base of the entrepreneurs and small businesses that are growing in numbers. They also must be able to achieve profits that allow them to expand and move into new sectors. Small businesses become a threat to a big government by working independently. They only need government to maintain there freedom to grow, not regulate how they operate. Note: we are looking at legal and ethical businesses that are truly in the vast majority.
When currency is disrupted by inflation or deflation, the profits that small businesses make are greatly reduced. Causing not only a money supply issue in the country, but also a lack of production resulting in a low or negative GDP and recession (Note: We are simplifying this concept, it is understood there are more factors that play into this). The entrepreneur is the life blood of the nation, we also see this in China and India which they have played in the foundation role of their countries current success.
When the colonies of this nation were founded, they were prospering by the freedom of the entrepreneur and the standard for trade. With out a stable standard of trade, entrepreneurs become indentured servants to a bank or government. Thus, reducing productivity and benefit. This is what England was trying to do when a revolution began.
In 1996, Jim Saxon of the Joing Economic Committe wrote a great article to the House describing the need for entrepreneurs, thus the need for reduced taxation and regluation.
How Government Inhibits Entrepreneurship
So much for the technical side of the relationship between Federal Government spending and the actions of entrepreneurs. We now will explore some of the specifics of how the overburden of government inhibits the capacity to function of those who organize the process of production. The very sense of the word entrepreneur is that it describes persons of imagination and energy who are willing to take risks in the hope of making profits. Success in these endeavors turns on their being able to institute new and different ways of combining inputs to generate the goods and services that a nation and its people desire.
Constraints on the freedom of people to be entrepreneurial interfere with this mechanism and reduce the total level of national output. This is where government enters the picture. In a prescient fashion, Alexis de Tocqueville saw the future of the modern state as one in which government “covers the surface of society with a network of small complicated rules, minute and uniform, through which the most original minds and the most energetic characters cannot penetrate, to rise above the crowd. The will of man is not shattered, bent and guided; men are seldom forced by it to act, but they are constantly refrained from acting. Such a power does not destroy, but it prevents existence; it . . . compresses, enervates, extinguishes . . .”[4] In short, it dampens the entrepreneurial spirit. It drags the economy down, slowing its rate of growth.
Our opinion, we will add the need for a standard of trade, such as, gold or silver. These to propositions will solve three problems: First, Government goes back to its original role (minimal), the banks lose the role of indenturing servants, and finally the GDP goes up increasing the overall financial strength of this nation.
A solid standard of trade simpy makes for a great prosperous nation.
Posted in Economy, Fiat Money, Gold | Tags: Barack Obama, business, Economy, entrepreneur, Federal Reserve, Fiat Money, Gold, hillary Clinton, history, John McCain, Life, Politics, Ron Paul, The Fed
