The Foundational Lie Of The Conservative Movement
I’ve known and met conservatives who say that the government adds nothing to the economy. I’ve encountered them on social media, and I read about them in the news. I see the talking heads on YouTube spouting their proverbial line that governments add nothing to the economy, and they say that we should limit the size of the government to the greatest extent possible.
For some insight into where all of this was coming from I read a few articles, this one in particular, about and a book by an economist and historian, Michael Hudson. I became interested in his work because he was the first writer I’ve ever seen to take note of an inscription on the Liberty Bell:
Proclaim liberty throughout all the land unto all the inhabitants thereof. LEV XXV X
Hudson performed a historical analysis to find that when they were speaking of liberty, they were speaking of freedom from debt. In an interview transcribed by Naked Capitalism, he goes into some detail about the enormous deception being played upon the debtors of the world by the creditors of the world. He says that the business of the banks is to keep the rest of us in debt, paying interest to them, and only them. That’s their business model. In that interview, I found an interesting nugget:
Michael Hudson [00:06:25] Right. The German firm Springer just published a Handbook of Money and Credit, in which I wrote the lead article on the origins of money, showing that the barter theory was made up by right-wing Austrian economists who hated governments acting in the public interest. Almost all the mainstream monetary theories are by right-wing anti-socialists claiming that government can play no positive role at all. Their conclusion is that money is best without government, and should be left to the private banks. The idea is that they would plan society better. So basically the libertarians, the free-enterprise boys, advocate a highly centralized economy — much more centralized than Soviet Russia, much more centralized than China. They want everything centralized in Wall Street or the City of London, that is, in the banks. They want the banks to be in charge of everything. They say that all this is all for the best.
Let’s break that statement down a bit. In that statement, Hudson exposes several central lies and deceptions of the conservative movement. The first is the origins of money. I had long believed that money was created by people who wanted a better medium of exchange than barter. I was wrong.
Here, we have a historian, Michael Hudson, who worked with the people who understood the Rosetta Stone and used that to translate the tablets and cylinders that recorded the laws and the transaction history of ancient times. Think Sumeria and Mesopotamia. Therein, Hudson found that governments created money so that people could pay taxes and that barterers had nothing to do with the creation of money. He is very generous in pointing out that the proponents of “Austrian economics” just made up the story about the origins of money from barterers. Did the fans of Austrian economics look at the actual historical records to know the origins of money? Sounds to me like they were speculating.
The second point I want to note about Hudson’s statement above is that the average right-winger believes that government can do no good at all. Nevermind that it was a government that came up with the idea of standard weights and measures. Nevermind that modern governments created standards like the kilogram, the meter, the ounce, the pound, the second, HTML, TCP/IP, and the measure of the force of gravity. Weights and standards are required for commerce. Governments are useful as third party arbiters in disputes, too.
But the main lie I want to get to here is that conservatives like to dish on government and how much better off we’d be without it, or with less of it. But what they don’t get or don’t talk about is that order naturally arises out of disorder. Conservative economists would rather see control centralized in private hands, not in public hands. Conservatives cannot see the government as a public good. They can only see government as a drag on the economy.
“The modern conservative is engaged in one of man’s oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.”― John Kenneth Galbraith
This is the central problem we must face in the debate over how we should run the economy. Do we want the economy to be run by unelected bureaucrats working in the nation’s largest private banks? Or do we want the economy to be run by democratically elected representatives of our mutual interests?
There is one other problem that I see with the conservative movement that we must address. Conservatives like to talk a good game about “free markets” but there is no such thing as a free market. In every society, in every economy, rules and customs arise out of disorder. We develop habits to limit the cognitive expense of decision making. We develop rules to set expectations in our transactions. The remaining question then is who writes the rules.
Since about 1975, conservatives have been writing the rules. Those rules gave us the savings and loan scandal in the 1980s. They gave us the collapse of the housing bubble in 2008. They gave us a nation completely unprepared to deal with a pandemic. They gave us a nation where so many people were living paycheck to paycheck, they had to get a government bailout to keep the economy running. Meanwhile, billionaire wealth increased by 27% in this year alone, during a major recession. That’s how the rules work, that’s not economics in a free market.
So it’s time to question the motives of conservatives. It’s time to put the question to them on social media. Are you really in favor of a free market, or do you just want the rules to favor people who already have money, in the hopes that you too, could be like them?