“ The Commerce Clause was intended to facilitate free trade by giving the federal government limited power to ensure state governments did not impose taxes and regulations on out-of-state business. Contrary to modern belief, the Commerce Clause was not intended to give Congress power to regulate every sector of the economy. And the Commerce Clause was certainly not intended to allow Congress to help state governments collect taxes on purchases from out-of-state merchants. The National Internet Tax Mandate overturns the Supreme Court’s 1992 Quill v. North Dakota decision that states can only force businesses to collect sales tax if the business has a “physical presence” in the state. Quill represented a rare instance where the Supreme Court properly interpreted the Commerce Clause. Thanks to the Quill decision, the Internet has remained a tax-free zone, though some states require consumers to later pay taxes on products they purchased online. This freedom has helped turn the Internet into a thriving and dynamic sector of the economy, to the benefit of entrepreneurs and consumers. Now that status is threatened by an alliance of big business and tax-hungry state governments seeking new powers to force out-of-state business to collect state sales taxes. Far from updating the Constitution to fit the needs of the 21st century, the National Internet Tax Mandate is a throwback to 18th century mercantilism.”
—Ron Paul, hitting the nail on the head as usual.
“In sum, the most important fact about the Great Society under which we live is the enormous disparity between rhetoric and content. In rhetoric, America is the land of the free and the generous, enjoying the fused blessings of a free market tempered by and joined to accelerating social welfare, bountifully distributing its unstinting largesse to the less fortunate in the world. In actual practice, the free economy is virtually gone, replaced by an imperial corporate state Leviathan that organizes, commands, exploits the rest of society and, indeed, the rest of the world, for its own power and pelf. We have experienced, as Garet Garrett keenly pointed out over a decade ago, a “revolution within the form.” The old limited republic has been replaced by Empire, within and without our borders.”
—Murray Rothbard
Why Aren't EU Protests Aimed at Central Banks?
thedailybell.comThe ability to print money from nothing is the singular achievement of modern elites and the single most ruinous practice of the modern state. It is responsible for most if not all of the abuses of modern history, from torture, to war, to genocide. Money-printing (not money) is at the root of all evil. — …if EU protests over austerity are to be effective, it is central banks that have to be peacefully targeted on a consistent basis. A message needs to be sent… There are no good central banks. There is only honest money – gold and silver – and PRIVATE banking (run privately by private individuals) with or without fractional reserve lending: money competition, in other words. What is necessary if EU citizens want the “austerity torture” to stop is for individuals to target central banks with peaceful protests. Not private banks. Not commercial banks. Not savings banks. CENTRAL BANKS! Surround the great, granite temples of money printing and begin!
The Daily Bell — Why Aren’t EU Protests Aimed at Central Banks?
Why the State Demands Control of Money
mises.orgThe question, then, that arises for you as the ruler is, How can I free myself of these two constraints, i.e., of tax-resistance in the form of falling tax revenue and of the need to borrow from and pay interest to banks?
It is not too difficult to see what the ultimate solution to your problem is.
You can reach the desired independence of taxpayers and tax payments and of banks, if only you establish yourself first as a territorial monopolist of the production of money. On your territory, only you are permitted to produce money.
Because you can create paper money out of thin air, you can also create credit out of thin air. In fact, because you can create credit out of nothing (without any savings on your part), you can offer loans at cheaper rates than anyone else, even at an interest rate as low as zero (or even at a negative rate). With this ability, not only is your former dependency on banks and the banking industry eliminated; you can, moreover, make banks dependent on you, and you can forge a permanent alliance and complicity between banks and state. You don’t even have to become involved in the business of investing the credit yourself. That task, and the risk involved in it, you can safely leave to commercial banks. What you, your central bank, need to do is only this: You create credit out of thin air and then loan this money, at below-market interest rates, to commercial banks. Instead of you paying interest to banks, banks now pay interest to you. And the banks in turn loan out your newly created easy credit to their business friends at somewhat higher but still submarket interest rates (to earn from the interest differential). In addition, to make the banks especially keen on working with you, you may permit the banks to create a certain amount of their own new credit (of checkbook money) in addition and on top of the credit that you have created (fractional-reserve banking).
What are the consequences of this monetary policy? To a large extent they are the same as with an easy money policy: First, an easy credit policy is also inflationary. More money is brought into circulation and prices will be higher, and the purchasing power of money lower, than would have been the case otherwise. Second, the credit expansion too has no effect on the quantity or quality of all goods currently in existence. It neither increases nor decreases their amount. More money is just this: more paper. It does not and cannot increase social wealth by one iota. Third, easy credit also engenders a systematic redistribution of social wealth in favor of you, the central bank, and the commercial banks within your cartel. You receive an interest return on money that you have created at practically zero cost out of thin air (instead of on money costly saved out of an existing income), and so do the banks, who earn additional interest on your costless money loans. Both you and your banker friends thereby appropriate an “unearned income.” You and the banks are enriched at the expense of all “real” money savers (who receive a lower interest return than they otherwise would, i.e., without the injection of your and the banks’ cheap credit into the credit market).
On the other hand, there also exists a fundamental difference between an easy, print-and-spend money policy and an easy, print-and-loan credit policy.
First off, an easy credit policy alters the production structure — what is produced and by whom — in a highly significant way.
You, the chief of the central bank, can create credit out of thin air. You do not have to first save money out of your money income, i.e., cut your own expenses, and thus abstain from buying certain nonmoney goods (as every normal person must, if he extends credit to someone). You only have to turn on the printing press and can thus undercut any interest rate demanded of borrowers by savers elsewhere in the market. Granting credit does not involve any sacrifice on your part (which is why this institution is so “nice”). If things then go well, you will be paid a positive-interest return on your paper investment, and if they don’t go well — well, as the monopoly producer of money, you can always make up losses more easily than anyone else: by covering your losses with even more printed paper.
Without costs and no genuine, personal risk of losses, then, you can grant credit essentially indiscriminately, to everyone and for any purpose, without concern for the creditworthiness of the debtor or the soundness of his business plan. Because of your “easy” credit, certain people (in particular investment bankers) who otherwise would not be deemed sufficiently creditworthy, and certain projects (in particular of banks and their main clients) that would not be considered profitable but wasteful or too risky instead do get credit and do get funded.
Essentially, the same applies to the commercial banks within your banking cartel. Because of their special relationship to you, as the first recipients of your costless low-interest paper-money credit, the banks, too, can offer loans to prospective lenders at interest rates below market interest rates — and if things go well for them they go well; and if they don’t, they can rely on you, as the monopolistic producer of money, to bail them out in the same way as you bail yourself out of any financial trouble: by more paper money. Accordingly, the banks too will be less discriminating in the selection of their clients and their business plans and more prone to funding the “wrong” people and the “wrong” projects.
Mises Daily: Why the State Demands Control of Money by Hans-Hermann Hoppe
“ No matter how much the modern economists imagine themselves beyond Mercantilism, in periods of general crisis gold and silver still appear in precisely this role, in 1857 as much as in 1600. In this character, gold and silver play an important role in the creation of the world market. Thus the circulation of American silver from the West to the East; the metallic band between America and Europe on one side, with Asia on the other side, since the beginning of the modern epoch. With the original communities this trade in gold and silver was only a peripheral concern, connected with excess production, like exchange as a whole. But in developed trade it is posited as a moment essentially interconnected with production etc. as a whole. It no longer appears for the purpose of exchanging the excess production but to balance it out as part of the total process of international commodity exchange. It is coin, now, only as world coin. But, as such, its formal character as medium of circulation is essentially irrelevant, while its material is everything. As a form, in this function, gold and silver remain the universally acceptable commodity, the commodity as such.”
—Marx, Grundrisse
Random Word: Mercantilism
An economic doctrine based on a belief that military power and economic influence were complements; applied especially to colonial empires in the sixteenth through the eighteenth centuries. Mercantilism policies favored the mother country over its colonies and over its competitors.
Mercantilism was a system by which imperial governments used military power to enrich themselves and their supporters, then used those rices to enhance their military power. Mercantilism’s principal mechanism was the establishment of monopolies that controlled trade and other economic activities, manipulating them so as to direct money into the coffers of the government and its business supporters.
Some merchantilist monopolies were held by a government itself, such as the Spanish crown’s control over many of its colonies’ gold and silver mines. Other merchantilist monopolies were granted by a government to private business, such as the Dutch East Indies Company and the Hudson’s Bay Company. These private enterprises held exclusive rights to economic activities in vast areas of the colonial world
His mother was a votaress of my order:
And, in the spiced Indian air, by night,
Full often hath she gossip’d by my side,
And sat with me on Neptune’s yellow sands,
Marking the embarked traders on the flood,
When we have laugh’d to see the sails conceive
And grow big-bellied with the wanton wind;
Which she, with pretty and with swimming gait
Following,—her womb then rich with my young squire,—
Would imitate, and sail upon the land,
To fetch me trifles, and return again,
As from a voyage, rich with merchandise.
But she, being mortal, of that boy did die;
And for her sake do I rear up her boy,
And for her sake I will not part with him.
- Shakespeare, A Midsummer Night’s Dream, Act II, Scene I
