American mercantilism?

We often hear the ignorant refer to the present American economic system as free market capitalism or mostly just “capitalism” where they mean free markets, and yet the American system has been heavily controlled, regulated, and interfered with by government for over a century with no free markets to be seen anywhere. Some say that the political control of the economy started from the very beginning of the Republic and the citizen’s right to do as he pleases as long as he harms no one else was violated with increasing frequency as time went by.

It matters little if you call the American system fascism, corporatism, crony-capitalism, “the third way”, a mixed economy, socialism, or even the more archaic term “mercantilism”. There is a spectrum that runs from laissez-faire free-markets (with no government intervention at all) to the fully government controlled economies of a North Korea or the old USSR. History and the Austrian School of Economics have shown over and over that any government intervention always makes the situation worse and normally makes it much worse for the poorest people. After all, as Groucho Marx observed “Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly and applying the wrong remedies.”

Murray N. Rothbard wrote about mercantilism in Conceived in Liberty (1975), volume 1, chapter 32: “Mercantilism, Merchants, and Class Conflict.” He observed:

The economic policy dominant in the Europe of the 17th and 18th centuries, and christened “mercantilism” by later writers, at bottom assumed that detailed intervention in economic affairs was a proper function of government. Government was to control, regulate, subsidize, and penalize commerce and production. What the content of these regulations should be depended on what groups managed to control the state apparatus. Such control is particularly rewarding when much is at stake, and a great deal is at stake when government is “strong” and interventionist. In contrast, when government powers are minimal, the question of who runs the state becomes relatively trivial. But when government is strong and the power struggle keen, groups in control of the state can and do constantly shift, coalesce, or fall out over the spoils. While the ouster of one tyrannical ruling group might mean the virtual end of tyranny, it often means simply its replacement by another ruling group employing other forms of despotism.

In the 17th century the regulating groups were, broadly, feudal landlords and privileged merchants, with a royal bureaucracy pursuing as a superfeudal overlord the interest of the Crown. An established church meant royal appointment and control of the churches as well. The peasantry and the urban laborers and artisans were never able to control the state apparatus, and were therefore at the bottom of the state-organized pyramid and exploited by the ruling groups. Other religious groups were, of course, separated from or opposed to the ruling state. And religious groups in control of the state, or sharing in that control, might well pursue not only strictly economic “interest” but also ideological or spiritual ones, as in the case of the Puritans’ imposing a compulsory code of behavior on all of society.

murray-rothbard-enemy-state

If those people who say that the USA has a system of modern fascism are correct then “fascism” does not differ all that much from the above described mercantilism. I suppose that is to be expected since the father of fascism, Benito Mussolini, modeled his system along the lines of strict government control just as the mercantilists of Britain did years before him.

It is obvious that the state controls the economic activities of all entities with laws, regulations, and the like, but what is not so obvious is that the modern US government even controls the entry of individuals into various occupations and professions. Not only can you not become a Doctor without the state’s permission, you may not even cut someone’s hair without the proper licenser. Try to become a cab driver without the approval of the state and see what happens to you. Like under “mercantilism”, the present government seeks to control, regulate, subsidize, and penalize commerce and production in all areas of American life. What has changed? The regulating groups have changed. The church is no longer part of the mix and the special interest groups seeking political power and handouts are different; but nothing has changed in reality.

As long as we allow the federal government to control the economic activities of the people then we can expect lower standards of living than we would have otherwise, especially for the poor. With modern mercantiliism can not expect liberty or freedom but rather we can expect dependency, slavery, and serfdom. We will be endlessly subjected to arbitrary and punitive rules and regulations. The state and all its minions seek to dominate you in all areas of your life and it finds dominating you in your economic activities is the easiest way to enslave you.

The most dangerous man to any government is the man who is able to think things out for himself and to discover the true nature of government. Think of men like Edward Snowden who found out what the government’s NSA was doing and told the world about what he found. He told the world without any regard to the prevailing superstition that there were terrorists under every bed. If we ignore the propaganda, superstitions, taboos and utter heifer dust that we were taught in the government schools, we would discover that we must come to the conclusion that the government we live under is dishonest, insane, and intolerable. Like H. L. Mencken, I believe that all government is evil and that trying to improve it is mostly a waste of time and is often counter productive.

The only way to maximize prosperity and peace is to stop practicing the American mercantilist system and to move to laissez-faire free markets, and the only way to have no government intervention in the market is to have no government at all. The Irish did that for perhaps 9,000 years.

Like many people this time of year, I wish for peace among men throughout the world. I know that the only way to have peace, prosperity, freedom, and happiness is for mankind to throw off the evil of the state that enslaves us. In the coming year we should all endeavor in anyway that we can to end the state and live in a voluntary world. We must teach people to withdraw their consent to be governed just at the people did in the old USSR. The good of all mankind does not depend on you recycling your trash, conserving gasoline, or having the grocery store put your purchase in re-usable bags. The good of mankind depends on you helping to overthrow the great evil that is the state. Do your part whenever you can.

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