Montreal, March 15, 2009 • No 265


Yvon Dionne has been retired since 1997. An economist by training (Universitι de Montrιal), he worked at the Bank of Canada (11 years) and for "our" Quebec government (20 years).






by Yvon Dionne


          On March 2, the Obama Channel (CNN) quoted an Obama activist comparing the new president to Robin Hood, and capitalism to a system designed to rob the poor. One thing is certain: a system of Robin Hoods designed to rob those who own something will end up making most people poorer, through a lack of investment, lack of employment, and the absence of freedom. We are observing these days the worst theft in history, with trillions of dollars being wasted, trillions that will feed inflation and higher taxes and only benefit the rent seekers and government bureaucrats.


          I received a little book (110 pages) entitled: Inclined to Liberty―the futile attempt to suppress the human spirit, by Mr. Louis E. Carabini (published by the Ludwig von Mises Institute). He dedicated the book to me as follows: "Yvon: to the sacrosanctity of life and the joy and benefits of liberty."

          The book originated from a discussion at a dinner party in Louis Carabini's home in California. At that party, social planners and would-be regulators complained about inequality and stated that the poor are poor because others are rich. Underlying this statement is the notion that the rich become richer only by exploiting the poor, and that there is a finite amount of wealth in the world. This is a notion borrowed from Marxism, and we know the results of applied Marxism.

          Even if we discount the tens of millions of deaths caused by collectivism (not counting people who did not die but lived in misery), we are witnessing these days, right before our eyes, the failures of Statism:

• health care has become more and more costly and unavailable;
• public schools are in a mess, and this mess is attributed by socialists to the free choice still being allowed to private schools;
• roads are not even fit for horse-riding, because horses would break their ankles;
• a never-ending avalanche of laws and regulations adds excessive costs to everything we do.

          The common answer from politicians and defenders of Statism is that they need more funds to cure the problems they have themselves created. The set of services (plus the redistribution system) that the State has monopolized is like a barrel full of holes. This non-market economy is unable to reduce its costs in real terms (in contrast with private producers of computers, cars, and so on), per unit of output (assuming consumers would still buy a pair of shoes that only fit one foot size, as we have seen in the planned economy of the former Soviet Union). What many might imagine the State does well is always costly, in terms of dollars and/or freedom.

          If it had not been for the struggling, semi-capitalist economy, striving under forced redistribution and decreed choices without competition, the State would have in fact made the poor poorer, to the benefit not of those who provide capital and employment, but to the benefit of myriad government parasites, from politicians to bureaucrats, from unions to corporations who lobby for more and more grants.

          The above are my own words summarizing Mr. Carabini's book. In a chapter entitled "The False Lure of Democracy," Mr. Carabini begins with a quote from Giordano Bruno, who was tortured and burned by the Inquisition in 1600: "It is more blessed to be wise in truth in face of opinion than to be wise in opinion in face of truth."

"The common answer from politicians and defenders of Statism is that they need more funds to cure the problems they have themselves created. The set of services (plus the redistribution system) that the State has monopolized is like a barrel full of holes."

          Now I will let the author speak for himself with a handful of some of my favourite lines from his book:

• The royal "we" seems to moralize and justify acts that the "I" would render reprehensible. (p. 12)
• History is replete with human gullibility; countless rulers have swayed their followers into believing that their economic problems have been caused by someone else's race, ethnicity, religion, or economic status. (p. 20)
• Grand profits are the most effective means to lower prices, since they attract investors and entrepreneurs to a business that they would otherwise overlook. (p. 21)
• People routinely blame their political leaders for not providing them better lifestyles. Many believe that the State can miraculously provide prosperity for everyone simply by creating and distributing wealth. (p. 25)
• In a democracy, each of us has a license to prescribe for others how to live their lives; run their businesses; whom they may hire; what wages they may pay; what prices they may charge; what, where, when, and how much they may smoke, drink, and eat; what they may plant; what medicines they may take; what houses they may build and where they may build them [and the list does not end here]. (p. 28)
• The democratic State simply provides an attractive means for some to acquire the resources produced by others at little or no cost to themselves, while preventing any real recourse for those from whom those resources are taken. (p. 31)
• If the U.S. government printed and distributed $1 million to every household in the country [...] would we all live better lives? (p. 39) A good question. This is exactly what governments are doing right now.
• Because of the tragedy of the commons, if all the food were to be evenly divided, the amount of food produced would fall to levels where all would go hungry. (p. 68)
• One's goods can be transferred to another person voluntarily, as in trade, or involuntarily, as in theft. (p. 71)
• With taxation, a society's productivity is diminished by all the benefits that would otherwise have been realized from the productivity of those [enforcing and collecting taxes + those acting as professional tax consultants + the forsaken productivity of those subsidized]. (p. 72)
• Problems don't disappear in free markets, of course; they simply are resolved or diminished more efficaciously there than in a system that employs coercion. (p. 97)

Now, the Big Question: What about the Future?

          Communists, and in general all collectivists and social or climate planners, proceed from the same starting point: they have the Faith, and they don't mind imposing their choices upon others. In Marxism, historical materialism made the advent of a communist Paradise inevitable. However, it was necessary to transition through a dictatorship (said of the Proletariat, but in fact of the new ruling class). They did not mind killing all their opponents or shipping them in cattle rail cars to concentration camps. In non-communist democracies, governments are more subtle. They allow you to disagree as long as you obey the laws.

          Freedom, it is said, is inevitable because it is a necessity of life. While I agree with the necessity of life, we must however observe that since the beginnings of humanity history there has been a cavalcade of horrors, murders, torture, atrocities. Despite the many discoveries and the growth of knowledge, the few steps taken to introduce freedom within a system of government (of minimum government) have been dwarfed by greater and greater steps toward the Brave New World that all social planners dream of, using coercion most of the time.

          In other words, it is hard to feel free when everything around us makes us into slaves. Although Mr. Carabini has deep thoughts about freedom, I have some doubts about the first part of the last sentence in his book: "Liberty is a state of mind." Liberty is not a metaphysical notion. When governments at all levels already control about half of GDP, and manipulate most of the rest of the economy through laws and regulations, it appears that liberty becomes more and more a state of mind and less and less an issue for the minds of the statists. Let's make liberty real.