In his column today, Thomas Sowell slays one of the most pernicious statist myths, namely that the government’s inaction under Herbert Hoover caused the economic downturn that began in 1929 to turn into the Great Depression.
The Obamacrats want people to believe that the free market is terribly unstable and it takes constant federal intervention to stabilize the economy, including massive “stimulus” spending from time to time. That’s pure bunk.
One of the 20th Century’s greatest economists, Murray Rothbard, pointed out that the state depends on an elaborate mythology to keep people docile in the face of its constant attacks on their liberty and property. A big part of that myth is that we desperately need government experts to “fine tune” the economy; without government intervention, we’d be in horrible depression much of the time, so the tale goes. The truth is that (as Rothbard showed) only government has the power to disrupt the smooth functioning of a laissez-faire economy. All of our numerous economic recessions and depressions have been preceded by government blundering in its manipulation of money and credit. Far from needing governmental policy to stabilize the economy, what we need is for the feds to stop throwing it out of adjustment.
