Central Banking Beats Free Banking?

In “More Bits on Whether We Need a Fed,” a November 21 Marginal Revolution blog post, George Mason University economics professor Tyler Cowen questions “why free banking would offer an advantage over post-WWII central banking (combined with FDIC and paper money).” He adds, “That’s long been the weak spot of the anti-Fed case.” Free banking [...]

“F” as in Fed

The Federal Reserve, America’s fatally conceited monetary central planner, is not terribly popular these days—which is cause for hope—and now we have a report card on the entire Fed era that strongly supports the view that we’d be better off without it. At the very least, as the authors suggest, the burden of proof is [...]

A Free Market in Banking? Not Even Close

Between the state and national governments, there has always been substantial regulation of money and banking in the United States.

The Private Provision of Public Goods

Nobel laureate economist Elinor Ostrom’s important work shows that people are very good at using voluntary action to solve problems that economics textbooks insist require the forceful hand of government. Producing “public goods” (such as irrigation systems for a community of farmers) often promises large enough gains to stir the creative juices of people—who, given [...]

A Crisis of Political Economy

The current state and the current banking sector require each other. They are so reciprocally intertwined that each is an extension of the other.

Remember this the next time somebody tells you, as New York Times columnist Bob Herbert did, that “free market madmen” caused the current financial crisis that is threatening to undermine the global economy. There is no free market. There is no “laissez-faire capitalism.” The government has been deeply involved in setting the parameters for market relations for eons; in fact, genuine “laissez-faire capitalism” has never existed. Yes, trade may have been less regulated in the nineteenth century, but not even the so-called Gilded Age featured “unfettered” markets.

How Rapidly Should the Money Supply Grow?

I would like to make one correction to Howard Baetjer’s article “Inflation 101” (September). The author suggests that inflation results when the money supply expands faster than the rate at which goods and services are produced. The author correctly points out that this expansion of the money supply will lead to rising prices. But inflation [...]

Government, Fiscal Responsibility, and Free Banking

Richard Ebeling is the president of FEE. This paper was delivered at a conference on “One Hundred Years of Dollarization, or a Century without a Central Bank: The Case of Panama,” sponsored by Fundación Libertad in Panama City, Panama, on November 12, 2004. There has been no greater threat to life, liberty, and property throughout [...]

Market Money and Free Banking

“If we want to have money, it must be something that cannot be increased with a profit by anybody, whether government or a citizen. The worst failures of money, the worst things done to money were not done by criminals but by governments, which very often ought to be considered, by and large, as ignoramuses [...]

Bank Deregulation and Monetary Order by George Selgin

Routledge • 1996 • 288 pages • $69.95 Parth Shah is an economics professor and president of the Center for Civil Society, New Delhi, India. The classical gold standard is generally considered to be the only monetary system consistent with the principles of laissez faire. In that system, the currency issued by the government is [...]