She writes:

By 1987, Ayn Rand acolyte Alan Greenspan had taken over as head of the Federal Reserve, and free market fever was unleashed upon America.

Alan Greenspan was indeed one of the original acolytes of Ayn Rand, but he deviated from pure laissez faire by becoming head of the central bank called the Federal Reserve. The notion that a “free market fervor” emanated from a statist institution like the Federal Reserve is absurd. It may have been in the direction of relatively more freed market freedom, but a fervor implies a massive revolutionary shift. Something I highly doubt occurred, but I am open to evidence otherwise.

The next thing worthy of discussion she wrote was:

People in U.S. business schools started reading Ayn Rand’s kooky novels as if they were serious economic treatises and hailing the free market as the only path to progress

Ayn Rand’s novels do touch on economic themes like corporatism and government management or regulation of the economy. It may not be a full blown economic treatise, but it doesn’t deserve to be dismissed. This left-libertarian market anarchist doesn’t believe the free market or freed market is the only path to progress. A healthy dose of civil society is essential to my theory of political economy and positive change.

Since the ‘80s, the top salaries and pay packages awarded to executives of the largest companies and financial firms in the U.S. have reached spectacular heights. This, coupled with low growth and stagnation of wages for the vast majority of workers, has meant growing inequality. As income from labor gets more and more unequal, income from capital starts to play a bigger role. By the time you get to the .01 percent, virtually all your income comes from capital—stuff like dividends and capital gains. That’s when wealth (what you have) starts to matter more than income (what you earn).

Wealth and income are related. You can also be said to earn wealth too. It doesn’t simply refer to what you already have. I agree that more wealth being acquired through capital rather than labor is a problem, but I don’t see government or the state as the solution. Freed markets will ensure that the only way of getting an income or obtaining wealth is through labor. They will also ensure that the wage of labor is its full product.

Another thing she writes is:

Wealth gathering at the top creates all sorts of problems. Some of these elites will hoard their wealth and fail to do anything productive with it. Others channel it into harmful activities like speculation, which can throw the economy out of whack. Some increase their wealth by preying on the less well-off. As inequality grows, regular people lose their purchasing power. They go into debt. The economy gets destabilized. (Piketty, and many other economists, count the increase in inequality as one of the reasons the economy blew up in 2007-’08.

There are ways to address the above problems without using government or state power. In a left-wing market anarchist society, the productive would be able to keep the product of their own labor. The disconnect between labor and results would not exist, so it would be more difficult to make a ton of cash to hoard. One would have to be continually innovate or rely on the cooperation of newly empowered fellow workers to make staggeringly high levels of money to put away. Speculation can also refer to forecasting the future direction of things, but I see the author as talking about speculation in the context of finances.

Which brings us back to Friedman’s view that people naturally get what they deserve, that reward is based on talent. Well, clearly in the case of inherited property, reward is not based on talent, but membership in the Lucky Sperm Club (or marriage into it). That made Uncle Milty a little bit uncomfortable, but he just huffed that life is not fair, and we shouldn’t think it any more unjust that one person is born with mathematical genius as the other is born with a fortune. What’s the difference?

Actually, there is a very big difference. It is the particular rules governing society that determine who amasses a fortune and what part of that fortune is passed on to heirs. The wrong-headed policies promoted by libertarians and their ilk, who hate any form of tax on the rich, such as inheritance taxes, have ensured that big fortunes in America are getting bigger, and they will play a much more prominent role in the direction of our society and economy if we continue on the present path.

She is partially right that inherited property or wealth has nothing to do with talent. I’d only add that it might represent talent in the form of manipulating the person who gives the wealth away. The rules of society do indeed determine who gets a fortune, and those rules deserve to be changed in the direction of left-wing market anarchism.

What we are headed for, after several decades of free market mania, is superinequality, possibly such as the world has never seen. In this world, more and more wealth will be gained off the backs of the 99 percent, and less and less will be earned through hard work.

Which essentially means freedom for the rich, and no one else.

We don’t live in any society with free market mania. I otherwise agree with her assessment. Look to my next blog post for an explanation and justification of the economic perspective underlying this assessment of Lynn Stuart Parramore’s article.

Sin embargo, Greenspan de alguna manera se las arregla para imaginarse de dónde viene el “valor intrínseco” de registros contables y pedazos de papel verde respaldados por nada más que el “prestigio y solvencia” de los políticos que succionan un alto porcentaje de la riqueza supuestamente representada por esos dólares a través de impuestos directos, que han “tomado prestado” otros 17 billones de dóares (después de que la Reserva Federal los creara de la nada), y que han comprometido al gobierno de los Estados Unidos a hacer frente a decenas de billones más en pasivos, todo bajo la premisa de que encontrarán una manera de robar esa riqueza del resto de nosotros para financiar sus jugarretas.

Vaya morro. Andar por ahí dándole clases a la gente sobre “burbujas” y elefantes blancos después de haber hecho una carrera especializada en esas actividades. Pero bueno, he de admitir que el tipo es, de alguna manera, un experto sobre el tema.

No soy economista, y trato de no jugar a serlo en Internet. Y sé que algunos economistas–no solo los farsantes keynesianos y monetaristas, sino también algunos de verdad verdad, o sea, de la Escuela Austriaca–son escépticos de Bitcoin como “dinero real” por razones varias. Y respeto su escepticismo. Ya se verá si tienen razón o no.

Pero es importante tener en cuenta que las razones por las que Bitcoin preocupa a políticos, burócratas, reguladores, banqueros conectados y otros miembros de la clase política no son ni económicas (si Bitcoin es un castillo de naipes, no lo es más que el régimen monetario de la clase política), ni regulatorias (¿nos protegieron los reguladores de Bernie Madoff o de los colapsos bancarios del 2008?), ni de índole criminalística (en el 2012 el fraude de tarjetas de crédito y débito le costó 5,5 millardos de dólares y afectó al 10% de los estadounidenses… pero los políticos nunca sugirieron dejar de usar el dinero plástico para eludir estos problemas).

Las preocupaciones de los políticos y sus parásitos son mucho más simples: a lo que le tienen miedo es a perder el control.

Las consecuencias fiscales son parte importante de ese miedo, y con razón. Los movimientos de una moneda digital transnacional, descentralizada, de par en par, potencialmente anónima (Bitcoin no es inherentemente anónima, pero es relativamente fácil oscurecer la identidad de los que se realizan transacciones con ella) son muy difíciles, o imposibles de gravar. Pero los gobiernos pueden adaptarse gravando cosas que son más difíciles de esconder, como la ocupación y el uso de la tierra, o el movimiento de bienes físicos.

El tema de verdadera importancia para la clase política es que una moneda digital transnacional, descentralizada, de par en par y anónima es mucho más inmune a la manipulación política. Si su sistema de creación es seguro y ellos no controlan ese sistema, no pueden “tomar prestado” dinero creándolo de la nada. Si es verdaderamente transnacional y ampliamente adoptada, será mucho más difícil usarla como instrumento de guerra económica entre estados o dentro de ellos. Si no puede regularse efectivamente, los amigotes políticos de las corporaciones no podrán usarla para impedir la entrada a competidores potenciales.

Y por supuesto, una moneda como esa sería también enormemente ventajosa para el resto de nosotros por las mismas razones. Una separación completa de la economía y del estado será un importante avance hacia la abolición de éste, y hacia que aquella funcione más eficientemente para el resto de nosotros.

¿Será Bitcoin el instrumento con el que lograremos esa separación? Quizás sí, quizás no… pero ese instrumento va a llegar más temprano que tarde.

Artículo original publicado por Thomas L. Knapp el 7 de diciembre de 2013.

Traducido del inglés por Alan Furth.

Somehow, however, he can stretch his imagination to reckon “intrinsic value” in ledger entries and green pieces of paper backed by nothing more than “the full faith and credit” of politicians who yank double-digit percentages of the wealth supposedly represented by those dollars out of the economy in direct taxation, who have “borrowed” (after having the Federal Reserve create it out of thin air) another $17 trillion, and who have committed the US government to future liabilities of tens of trillions more, all on the premise that they can find some way to steal that wealth from the rest of us to finance their schemes.

No chutzpah deficiency there, that’s for sure. Lecturing other people on “bubbles” and Cloud Cuckoo Land projects after his own career in same? Really? On the other hand I guess he is, by definition, an expert on the subject.

I’m not an economist, and I try to avoid playing one on the Internet. Yes, I’m aware that some economists — not just Keynesian and monetarist nutcases, but the real thing, i.e. Austrian School types — are skeptical of Bitcoin as “real money” for various reasons. I respect their skepticism. I guess we’ll see.

It’s important to keep in mind, though, that the concerns of politicians, bureaucrats, regulators, crony banksters and other members of the political class over Bitcoin are neither true economic concerns (if Bitcoin IS a house of cards, it’s no more so such than the political class’s own “currency” regimes) nor regulatory concerns (did regulators protect us from Bernie Madoff or from the 2008 bank collapses?) nor crime/fraud concerns (in 2012, credit/debit card fraud cost $5.5 billion and affected 10% of Americans … did politicians suggest avoiding credit/debit cards?).

The concerns of the politicians and their hangers-on are far more simple than any of that: What they fear, as they should, is loss of control.

Taxes are part of that fear, and rightly so. The movements of a transnational, decentralized, peer-to-peer, potentially anonymous (Bitcoin is NOT inherently anonymous, but is fairly easy to obscure identity links to) digital currency will be difficult — OK, impossible — to tax. But governments can adapt by taxing things that are harder to hide. Land occupancy and use, for example, or the movement of physical goods.

The bigger issue, to the political class, is that a transnational, decentralized, peer-to-peer, anonymous digital currency is far more immune to political manipulation. If its creation system is secure and if they don’t operate that system themselves, they can’t “borrow” money by creating it. If it’s truly transnational and widely adopted, it will be harder to use it as an instrument of economic war between or within states. If it can’t be effectively regulated, Big Business can’t have its friends in government use it to bar entry to, or disadvantage, new competitors.

And of course such a currency is great for the rest of us for all the same reasons. A complete separation of economy and state will be a major step toward abolishing the latter and putting the former more efficiently to work for the rest of us.

Will Bitcoin be the instrument of such a separation? Maybe, maybe not … but that instrument is coming.

Translations for this article:

• Spanish, Por qué Bitcoin les hace Temblar de Miedo.