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by Adrian Sobers
“Let the lie come into the world, let it even triumph. But not through me.” – Aleksander Solzhenitsyn
Once upon a (cover of) TIME, 2009 to be precise, Ben Bernanke was selected as Person of the Year.
The one constant in the man-made currency catastrophe/crisis is the lack of shame and abundance of gall from politicians, central bankers (including, nay especially, muddleheaded macroeconomists wedded to their equally muddleheaded models).
The powers that be, conveniently ignore the root issue (governance deficit), and continue to peddle fairytale narratives that date back to aforementioned cover.
The reassurances from politicians and central bankers about “fighting” inflation/cost of living ring hollow,
for one simple reason: they caused it. But, perhaps, they think the public is foolish.
A more accurate (and honest) message to the public, based on their actions from around 2009 would be the hook from Kendrick Lamar’s Mirror: “I choose me.” (They always do.) Never forget: We are (still) in the throes of the greatest (and failed) monetary policy experiment in human history.
It might seem abstract but it has everything to do with the price of, well, everything.
The seeds of the economic hardships today were sown by politicians and central bankers choosing themselves over the public as historic levels of quantitative easing got underway around the world.
I cannot be totally blunt here (for reasons of faith and family, in that order), so seven words instead of three: fiat is, for all practical purposes, finished.
Since the powers that be, literally in our case, won’t touch the underlying governance deficit, us plebs will be forced to live with political patchwork.
Practically, this looks like more countries exploring the universally bad idea of a universal basic income, and central bank digital currency, to name but two. I asked a friend if he planned to buy Ben Bernanke’s new book 21st Century Monetary Policy. His response was priceless (literally): “Not worth a Continental.”
Indeed.
(It’s funny how the persons who put us in these precarious predicaments end up on the cover of TIME.) In The Man Who Understood Democracy, Olivier Zunz says that during bouts of depression Alexis de Tocqueville jotted down the three “human miseries” in this travel diary: diseases, death, and doubt.”
(Some local readers might be tempted to add a fourth: DLP.) Disease, and death in the form of COVID, and doubt (uncertainty) have acted like proverbial salt in the literal wound of the failed monetary policy experiment that continues to go south.
We, as in the world, will sink deeper into the quantitative quagmire and the multiverse of economic madness for the simple reason that our political and monetary overlords are dealing with the symptoms (economic) instead of addressing the underlying malady (political/governance).
There is a phrase Allan Meltzer used in his History of the Federal Reserve that you hear a lot in monetary policy discussions: “The space between rules and discretion.”
During this monetary policy experiment, both politicians and central bankers have gotten away actions that, to my mind, should now be occupying the judiciary. (It is unconscionable what they have done and the negative effect it’s had on the lives and livelihoods of especially the most economically vulnerable. But I suspect the area between rules and discretion is deliberately grey.)
Meltzer observed that “The Federal Reserve in 1951 was not well equipped to manage either the domestic or the international economy.” That is still the case today and will be for the foreseeable future, since our overlords have chosen not to deal with the governance deficit, or clear up the “[grey] space between rules and discretion”.
Given where we are and what we know, we are of all men most to be pitied if we still believe fairytale narratives like: Once upon a (cover of) TIME.
Since economic conditions will (not might) worsen; James 1:27 is a good place to start ridding ourselves of the fairytale narratives of this world. The idea that institutions who knowingly put us in this predicament – central banks and governments – possess the will to address the root cause. What to do? For a start, “Care for orphans and widows in their distress, and to keep oneself unstained by the world.” I don’t know about you, but it’s the lies for me.
Adrian Sobers is a prolific letter writer and commentator on issues of national interest.
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