Monday, October 19, 2009

How to Destroy an Economy

If I were a congressman, this is the speech I would've given a little more than a year ago, as the economy collapse was just happening. I would've been dead-serious as I strode up to the podium:

"Ladies and Gentlemen, we are no doubt living in perilous times. The economy has recently tanked, and the stock market is down greatly. But before we all panic and act hastily, let me read you something. It is entitled 'How to Destroy an Economy.'

If one were set on destroying an economy how would they do it? Here are a few of the ways I could see it happening:

1. Create a state of panic. Threaten martial law. Say how if we don't act now the sky will fall down. Do everything to over-exaggerate the severity of the crisis.

2. Double the money supply in a few short months. Do this by print trillions of dollars backed by nothing but their own paper.

3. Bail out and rescue those whose bad decisions led to this collapse. Create a false impression that some companies are just too big to fail. Create a giant moral hazard for corporations to engage in more future risky adventures and then try to keep a straight face when you say you won't bail them out again. Don't tell the people that the corporations you bail out finance your reelection campaigns.

4. Print a trillion dollars to pass an economic stimulus package based on the dubious premise of what we need is more borrowing and spending. Don't tell people we got into this mess by too much borrowing and spending. Pass the stimulus by saying we don't have a day to spare, but then wait a few days to sign it.

5. Create a scapegoat for the collapse by demonizing capitalism. Tell the masses we got into this mess by having too much freedom. Create the impression that we need more government and more regulation and less freedom.

6. Say that the debate is over on economic policies. Phrase all sentences by saying "all economists agree" followed by your plan.

7. Run a projected $10 trillion deficit over the next ten years. Create excuses for it by childishly saying "but the other party did it when they were in office!"

8. Use the crisis for other opportunities. "Never let a crisis go to waste" some in the highest positions may say. Pass healthcare reform with money you don't have.

9. Give the government institutions who created this mess more power. Let the quasi-government institution that has been the source of all bubbles be the regulator of future bubbles.

10. Reappoint the Fed Chairmen whose nickname is "HELICOPTER Ben!"

Thank you, and I yield back the balance of my time."

1 comment:

  1. Sounds faintly familiar. I can't imagine that a government would ever act to expand its power via repressive economic and military policy while systematically taking away the rights of its citizens! Governments help people! Just look at the Community Reinvestment Act! Social Security! Medicare! They protect us from marijuana! Say it aint so!