Originally posted by: Sahakiel
Originally posted by: Dissipate
Looking only at military issues, it's obvious a national entity is much better suited than individual states let alone cities. Of course, this is assuming the world is not a utopia.
You claim something is obvious yet do not describe how this is so. Explain how it is "obvious" that we need a national government on the enormous scale that we do now.
I posted about a national army and suddenly you're asking about a national government. Why am I suddenly beginning to question your thinking ability? Even you posted that a national military is better than localized armies. However, if you insist on an explanation because you can't think of one, I'll give one to you. Apparently you were either too busy trying to discredit me or you couldn't think of a good reason yourself.
A national army is much more effective on a national scale than a bunch of smaller armies. This has been proven throughout history for a variety of reasons. One reason is that having smaller standing armes combine into one large force creates even larger problems with supplies, logistics, command structure, varying capabilities, etc. Another reason is that a large number of small armies is easily defeated one by one by a larger force. A large single army promotes unity among the states. A single army can be adjusted to meet the needs of each state. I could go on, but it's getting way off topic.
The same philosphy is applied towards a national government. A larger sized government is much better suited for a large nation. A state-sized government is suited for a state and so forth. So simple even primary school students can understand.
Would you like to have a single state or at most a few states control the army? I'm sure even you can see the problems with that idea.
Who would regulate inter-state issues such as commerce and law? The Federal Government.
Who would deal with foreign nations in the areas of diplomacy, trade, and war? Hopefully, not one state only.
Who insures that you are free to live your life as you please? (Restricted by effects upon others) The Federal Government is the source of those freedems you seem to hold so dear (including your ability to even post to this forum). Usually the local government will determine issues such as landscaping, zoning, and education. The State will set general guidlines for the local authorities, but they are limited by the national government. The Federal Government ended slavery and Seperate but Equal (granted, the government initially allowed them; different times).
So before you ask why government should be so large, perhaps you should ask what would happen if the national government were the size of your city council.
The concept of micro-statism seems to be escaping you. In micro-statism there wouldn't even be states as we know it. There would be counties and towns each providing for their own welfare, safety and defense. Each one would have their own monetary system, but at the same time there would be a common currency used throughout the micro-states. In my idea the common/international currency would be the digital gold backed currency while the local currency would simply be the tokens for which that currency could be redeemed. In any event, all of the "problems" you mention about interstate commerce and what not would dissappear under micro-statism. For under micro-statism the illusion of a country would disappear and every state would make its own decisions about commerce, war, diplomacy and trade. With regards to defense, the micro-states would simply form alliances.
Hm.. I fail to see how it would be better unless you assume small monetary systems are better than national systems. Historically, national systems have brought more benefits to the nation and its people than a mishmash of localized monies.
Small monetary systems are better, they enable a small community to have a monetary system that is in tune with their value system and ideas about how a monetary system should work. One monetary system does not fit all. You may be perfectly content with the Federal Reserve and unbacked currency, but others may not be. What would be so bad about a community having their own currency and banking system?
On the other hand, large monetary systems are less prone to effects of local events. A tornado touching down in Kansas City doesn't devastate the economy and send it into the proverbial pithole. With a larger monetary system, the exchange rates for goods and services is buffered from the local catastrophe, allowing the community to recover much faster. If they only had a local monetary system with exchanges at the borders, the disaster would immediately signal hyperinflation as the people frantically purchase goods and services from outside that only take another currency.
Large monetary systems are convenient, as stated before.
Large monetary systems make hoarding by a single entity that much more difficult.
Large monetary systems promote unity. If each state had its own currency (as in the early years) the daily use of currency serves only to emphasize the division between the states. Citizens today identify more with being a US citizen than a resident of a state or smaller community.
A small community having its own local currency isn't too bad in that the effects upon the national economy are negligible. As the currency system gets larger, problems will arise as exemplified in previous statements/posts. A local currency system is a problem for the locals to handle and can actually be severely detrimental if the local people only take the local currency.
Large monetary systems appear to be convenient, just as many people in the military find it convenient to have someone tell them what to do all the time. However, that convenience has a price, its price is freedom, control and power over oneself and community. When you give up the control over your medium of exchange you forfeit your individual power to a centralized power. This is far more dangerous that problems relating to natural disasters, for now the central power is charged with the task of maintaining an entire economy. This is far too much responsibility, for if this single power fails to perform this task the ENTIRE economy will plummet into depression. On the other hand if the economy of a single micro-state goes under, the other micro-states are unharmed and will be able to help out the badly affected micro-state.
As for hoarding, I don't see this as a problem. In fact it is not a problem, people should be allowed to hoard what they want and how ever much they want at any time. The idea that we need inflation to stop hoarding is absurd.
What you call unity, I call centralized power. Unity is a nice word, but it has much too positive of a connotation in this context. Unity can exist in many other ways outside monetary systems.
Explain how a local currency would be detrimental if the locals only accepted that local currency, I don't understand.
Large inflation is caused by the printing of "money" on a large scale. Lack of faith in it may have something to do with it, but it is mostly printing that causes it to inflate, especially in the U.S.
Large inflation CAN be caused by excessive printing, but is not necessarily the primary reason. A contraction of the economy without an equivelent reduction in printing can lead to inflation. Negative currency trading can lead to inflation, especially with an economy like the US that is heavily dependent on foreign trade.
The excessive spending of the Federal government contributes to inflation, as you say and I agreed in a previous post. However, it is not the only source and has only recently become a major factor due to the recession.
Short term inflation can be caused by market forces, but as I quoted a Fed economist earlier as saying, long term inflation only has one cause: increasing the money supply beyond the output of the economy.
The monetary system is an artificial creation of government. Economically this is not really how things work, because the free market would be much harder pressed to create a banking cartel, or even fractional reserve banking at all. Fractional reserve banking and unbacked currency is an artificial product of government power. Fact.
Economically, it is how things work by the very fact that it IS the monetary system in use. Free markets have little difference other than a decentralized monetary authority. Free markets react slower, in multiple directions, and actually do have fractional reserve banking. Remember my comment earlier about collapsing banks long before the US was even formed? Fractional reserve banking with really small fractions. All it takes is one guy's bounced check to spread the word and suddenly all the customers realize they have to withdraw their money or lose it all.
Read Rothbard's chapter called: Money in a Free Society in his book: What has government done to our money? He explains how the market would keep the banks in check. The bank failures were just that, they were the market keeping things in check. Along came the Federal Reserve which was supposed to end all that, but what does this mean? It meant a banking cartel so that no failures would occur and the market would no longer be kept in check.
Do you not realize that choosing not to vote is an exercise in power as well? How many other states have actually forced people to vote one way or another in order to fake a display of support?
It is not an exercise of power, it is a forfeiture of power.
It is only a forfeiture of power if the power cannot be regained. The power to vote is still in the hands of the people. Any citizen can at any time decide to register for the next vote and the government itself must and does help the citizen register and vote.
Unfortunately those citizens are unaware of the gravity of the situation. That is what I am trying to alert them to.
A singular entity promotes collectivism, increases costs for everyone and facilitates the flow of wealth from wealthy states to states that merely exercise political influence on the national level. My state: California only receives back something like 60 cents on the dollar from the federal government.
California isn't exactly the best example of sound economics. I am actually curious as to how much California got back during the height of Cold War spending. Though no matter what, I would venture to say that the missing 40c consisted mostly of projects in other areas of the country. The government is bloated to be sure, but probably not that much.
Assuming the 40c goes towards other services, it would actually be beneficial to the country as a whole. Take, for example, the military. Instead of the government installing military bases in each state according to its size, it can build less bases that are better defended, more suitable for training, and less intrusive (or more) to the general population. Area 51 is in Nevade for a very good reason and states want more bases for a good reason as well.
What if people in a particular state are tired of subsidizing the other states? Why should one state pay for another state's pet projects? It shouldn't. This is why micro-statism is needed, to insure that each community pays for its own pet projects, not exercise political power to get others to pay for them just because those people are part of the same country.
I don't understand how mass fraud could be anything less than an epedemic of "forest fires".
That is because you are assuming that mass fraud has occurred. Since that assertion has been proven flawed, it is the equivalent of you yelling "forest fire" and us going over to find somebody grilling a few burgers.
Is it so flawed? Why have Austrian economists said time and time again that fractional reserve banking is fraud? An entire school of economics has raised this issue, not just me.
People pick the currency currency because they have no idea that they are being scammed. Also, many people believe they must accept government currency at their business. This is what the nonsensical phrase: "THIS NOTE IS..." is all about.
So tell me this : why are you still using the "fake" currency?
People aren't using the currency solely because they're being scammed. First off, it's not a scam. Second, the reasons for using the currency has been explained over and over again. Reasons include convenience, stability, and value.
Businesses know they are not required to accept US dollars. Well, if they do, then they are thinking along the same path as you. Businesses that only accept US dollars do so because that is by far the most stable currency they have available or it is by far the most popular currency they encounter. The choice of currency (or even form of currency) is entirely dependent on the locale.
Only an idiot would open a shop in East LA that accepted only rubles. An even bigger idiot would open a shop in LA that accepted only Ithaca Hours (Hours are only accepted in a ~20 mi radius). You could even open a shop that accepted only gold and sold goods and/or services per mass of gold. However, I doubt you'll sell much.
People who travel to different countries often have to exchange their national currency for another. Now that we have international currencies, this is no longer a problem. Someone in micro-state A merely converts their local currency to the international currency, then converts it to micro-state B's local currency when they travel. As technology progresses the fees related to these transactions would be minimal.
Have control of what? Balance is an illusion, the government is holding all the cards, it calls all the shots. That's why we have to take the medium of exchange back, so WE can call the shots.
The government doesn't hold all the cards. You are implying that US citizens are borg, mindlessly following the orders of a central authority. However, you have only to look at the free market to see that ultimately, the control of currency lies in the people. I'll explain why, since I'm beginning to learn you don't think beyond what I type.
In a nutshell, the use of a certain currency is a choice by the consumer. The consumer can use any currency he wants, much the same as the producer and middlemen can accept any currency they want.
That is true but first of all most consumers believe it would be illegal to use another currency because of their misinterpretation of "legal tender (sic) laws", second of all the government has created a monopoly that gives the impression that FRTs are a cheap currency to use. This false perception makes it very difficult for alternative currencies to compete, because those currencies bear the costs of warehousing of precious metals and so on. The government has severely distorted the market for currencies and essentially pushed everyone else out of business. Fact.
Fact, as distorted by one Dissipate. How ironic.
If I remember correctly, I think it is actually illegal for a bank to issue its own money. I forget the reason local currencies and gold banks are allowed but it was a seemingly minor point that kept them out of the wrong side of the law. Even Disney is allowed to print their own bills.
At any rate, it is illegal to use any currency other than US dollars for things such as paying your taxes. I think what makes alternative currencies free from legal strife is that in the end, the currency is converted into dollars. Ithaca Hours are no more than dollars in another form. Gold depositories are treated as stores of goods and are readily converted to dollars.
Banks may be barred from doing this because they are under control of the Fed. Anyone can open a gold warehouse and start issuing Notes on that gold, but they will quickly learn that they will be pushed out of business quickly by the Fed's monopoly. You are right, the government only accepts dollars for payment of taxes. The question is, what if dollars became worthless because everyone started using alternative currencies? The only reason why the government can force people to pay in dollars for their barter transactions is because the government knows that dollars are accepted in the economy for goods and services. As soon as the economy jumps ship, dollars will become worthless. Gold depository holdings are usually readily convertible into dollars, but now the paradigm is shifting. With the digital currencies you have businesses accepting the currency directly without it being converted. So you have digital currencies that just keep circulating 'round and 'round, never being converted back to dollars.
I already explained why the government stopped hyperinflating in the '70s, it adopted a policy of "low inflation" so it could bleed wealth away slowly so no one would notice. Just because we don't have HYPERinflation does not mean the government is still not profiting from inflation.
I seem to recall the primary cause of high inflation being the rising price of crude oil. As the dollar fell due to a recession, OPEC found they got less value out of selling each barrel of oil. Ironically, that was a direct result of backing their oil with the dollar (they're still doing it today). OPEC raised prices and essentially screwed over the already weak industries that relied on oil (a large majority).
The "normal" policy for the Federal Reserve is to increase the money supply during a recession. However, with OPEC raising the price of crude, the plan backfired. Increasing the money supply only exacerbated the problem.
You keep pushing the "low inflation" strategy as a under-the-radar scam. The fact is the "low inflation" policy is really two policies : "help grow the economy" and "inflation is better than deflation." Actually, the second is probably a corallary of the first.
The increased money supply is to increase capital investment to stimulate economic growth. The "deflation is evil" idea comes from the contraction in economic output as a result of deflation. Put them both together and you get a positive inflation rate.
Economists disagree on this subject of whether inflation is good or bad, I happen to believe that it is very bad and any Austrian economist will tell you the same, but as I said so many times before, long term inflation is NOT caused by market forces of any kind. This is from a Fed economist himself, see above.
Do we really? We have other things to worry about than our standard of living from now until forever?
I can name a few. Start with the standard of living for our descendents. Throw in the whole mess in Iraq and its related projects. Add a few thousand problems with the government itself. Factor in religion (for those that apply). The list goes on and on and is unique to each individual.
The mess in Iraq has nothing to do with our standards of living, it was a war created to distract Americans from what is going on here. As long as there is a war people will be oblivious to what is going on around them. Interesting you mention thousands of problems with the government itself, thank you for strengthening my argument that one government does not fit all.
Um... you asked specifically for examples of things to worry about OTHER than our standard of living.
Also, my mention of thousands of problems in government does not strengthen nor weaken your argument for smaller, more personalized, governments. I said this before and I'll say it again : every system has its problems. I already went over a laundry list of problems with your proposal and I already did the same for the current system. Weighing both together, it seems the current system is the lesser of two evils.
You haven't weighed anything, you have merely said: "Well, this is they system we have and here is why it is the best." You have never lived in a time when the system was different. The current system is not the lesser of two evils, it is simply evil.
They sit back and think they are free based on their empirical observations but they never really try to understand the inner workings of the monetary system and government that actually make them slaves.
All through elementary school, high school and even part of college I sat back and said: "It is obvious, I AM free.". I never read any material that claimed otherwise, I never questioned the monetary system or the system of government that was in place, I figured it was the system that was logically the best.
Old adage: "Better late than never."
Although I do have to wonder about the "...never read any material that claimed otherwise..." From what I remember of my 11 years in mandatory schooling, there was enough "Compare and Constrast" assignments to make the first two years of college a breeze.
In the two economics classes I took: Macro-economics and Micro-economics the classes basically said: "This is how it works, we are going to study this." instead of "This is how it SHOULD work." Once I started reading about how things should work, my interest in how they have artificially been made to work through government intervention quickly faded.
You seem to like making grandios statements that really serve no purpose but to make you look intelligent. 
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