TCS Daily


Lifestyles of the Superrich and Not So Famous

By Donald Boudreaux - September 7, 2006 12:00 AM

When I lecture to teenagers and twentysomethings here in the United States, I often ask members of the audience to "raise your hand if you're wealthy." Except for the young woman years ago who announced that her father owned a string of 7-11s, no one ever raises a hand.

"Oh but you are wealthy!" I insist. "Each of us is among the wealthiest people ever to breathe."

My listeners think me mad. "I'm middle-class, not rich" surely is what most of think to themselves. And they're right about being middle-class -- but they don't realize that to be middle-class in America today means to be superrich by historical standards.

Here's a small sample of the many ways in which ordinary Americans today are Bill-Gates-like rich compared to almost all humans who've ever lived:

  • None of us has ever starved to death
  • We have indoor plumbing and artificial light
  • We bathe regularly
  • We have solid roofs over our heads, rather than bug-and-vermin-infested thatched roofs
  • We routinely converse in real time to people one mile or one thousand miles away
  • We don't get smallpox
  • Our life expectancy is decades longer

And while it's possible to list some ways in which the average person today is worse off than were pre-industrial folk -- for example, no one before the 20th century died in airplane crashes -- only the most doctrinaire ascetic would deny that almost everyone today in the Western World is vastly better off than were the overwhelming bulk of the human population before the industrial revolution.

But what caused this great wealth explosion?

The standard answer is technology. The standard answer is wrong.

Technology clearly has advanced over the years, and happily it continues to do so. And these advances are indeed indispensable to our modern way of life. But the deeper cause of our widespread wealth isn't technology; rather, it's the force that unleashes and directs the human energy necessary to produce technological advances and its fruits: free markets.

Markets are more fundamental than is technology to prosperity. For evidence, look no further than the fact that billions of people today remain desperately poor. People in Niger and North Korea are starving to death now, even though the technical knowledge for growing and distributing basic foodstuffs is readily available across the globe. Many Latin Americans and Eastern Europeans still carry their goods to and from market on wooden carts, despite the easy availability of automotive technology. Countless other people today dwell in earthen huts, have no indoor plumbing, die of malaria, and suffer all manner of other dangers and indignities that are easily avoided with commonplace technologies.

It is manifestly mistaken to suggest that technology is the reason for our prosperity. Clearly, our prosperity must rooted in something deeper than technology -- something that both promotes technological advance and, even more importantly, encourages the use of technological knowledge to make widely available the goods and services that we Americans today take for granted.

That something else is economic freedom which spawns complex markets.

As shown again and again by researchers who study the relationship between prosperity and economic freedom, the greater is economic freedom, the greater and more widespread is prosperity.

Among the best of these studies is one produced annually by economists James Gwartney and Robert Lawson, and published jointly by the Cato Institute and Canada's Fraser Institute. The 2006 study will be released this week. Among the most important findings of Economic Freedom of the World: 2006 Annual Report are these:

  • Nations in the top fourth in economic freedom have an average per-capita GDP of US$24,402, compared to US$2,998 for those nations in the bottom fourth

  • The top fourth of economic freedom also has an average per-capita economic growth rate of 2.1 percent, compared to 0.2 percent for the bottom fourth

  • Unemployment in the top fourth of economic freedom averages 5.9 percent, compared to 12.7 percent in the bottom fourth

  • Life expectancy averages 77.8 years in nations in the top fourth of economic freedom but a mere 55.0 years in the bottom fourth

  • Nations in the top fourth of economic freedom have only 0.3 percent of children in the work force, while nations in the bottom forth suffer 19.3 percent of their children in the labor force

  • In the top fourth, the average income of the poorest 10 percent of the population is US$6,519 compared to US$826 for those in the bottom fourth

As this careful new study makes clear, there is no denying that more freedom means more prosperity for more people -- and that lack of freedom ensures poverty for the masses, regardless of the degree of technological sophistication.

Donald J. Boudreaux is Chair of the Economics Department at George Mason University.

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58 Comments

And Economic freedom is based on non-violence…
And Economic freedom is based on non-violence…
The level of theft violence and its use both through government and privately has a large impact on the standard of living of the people in a given area.

I have to believe that the protestant ethic had something to do with our great prosperity.
“Let him stole steel no more but let him work so that he has some thing to give. “

I wonder how significant an impact people like the Quakers and Ana Baptists who refused to collect taxes but followed the example of ants and went about their business had on our prosperity. Think of the saving if people just go about their business with the inefficiency of the police and the overseer. In a non-theft, non-violent world you save on all kind of locks (I mean this metaphorically).








historical comparson
A historian can make the case for the "standard answer", technology. The "western" standard of living was established only in the last few centuries while free markets have been established many times before that in the history of humans. Bands of hunter gatherers without market regulations still could not prevent smallpox, though archeological evidence shows that they (free) traded over great distances. What they lacked was not the will, but the way (technology).

Markets are technology
They are artificial instituions created by humans, and exist in as many variatiions as there are human society. More important to the present conversation, they exist because of, under the protection of, and dependent upon government in countless ways. Too much government intervention in markets can be disasterous. Too little, or corruptly managed government is equally bad, as the examples brought forth regrding technology not being enough illustrate.

We have a wide range of technologically advanced governments with a range of markets, and a range of government control — which create considerable differences in the weath effects being touted. Simply repeating the word "market" begs all the important questions.

markets are people
getting together to trade freely. Technology may be used by markets, but markets are not technology.
Markets exist without the presence of govt, indeed, the presence of govt destroys markets.

Technology is people too.
People using tools. Markets are a tool, like language, as artificial as a stone ax or a trasistor. They are a human institution, and the rules and enforcement of those rules change endlessly and flexibly. "trade freely" is an abstraction that requires rules. Some can be voluntary, others (regarding the use of violence, fraud, etc) need to be non-voluntary.

You're overreaching a bit
The role of government is essential to allow markets to function freely. Governments regulate monetary standards to ensure a basis for trade. Governments regulate the legal structure of transactions ensuring things like contract law can be enforced without the cheated half of a deal gone bad having to resort to mafia style collection.

There is no free market in anarchy, and the only alternative to anarchy is government.

"the only alternative to anarchy is government"
Sure. But government exists in a huge variety of forms and variations, all equally artificial. There's no such thing as generic "government." Instead, you have numerous governments - and numerous markets.

close, but not quite
Govts currently regulate money. But they didn't always, and rarely do a good job of it.
Contracts can be enforced by govt, but there are other mechanisms for doing it.

By definition, anarchy means no govt, so the opposite of govt, is anarcy, however it is not a truism that absence of govt is chaos. Anarchic institutions, can, and have survived for hundreds of years. Look up mideival Iceland.

Regardless, if govt were to limit itself to keeping the money sound, and enforcing contracts, I would have no complaints.

rules
Technology is the tool. Nothing more, nothing less.
People using the tool is a market.
Human institutions exist, but do not require govt to exist.
Trade freely is just two humans agreeing to exchange what one has, for what the other has. No need for formal rules, though informal rules can help lubricate the process.

Sure! Just look at the NYSE!
>Trade freely is just two humans agreeing to exchange what one has, for what the other has. No need for formal rules, though informal rules can help lubricate the process.

And when you have hundreds, or millions, or billions of people involved? No need for formal rules?

About money
Historically it's well established that only governments can regulate money. The most important aspects maintain consistency, through prevention of counterfeiting and in the days when bullion served as currency by preventing clipping or other doctoring of coinage. I would in fact argue that monetary regulation is one of the few areas of economics that governments (most of them) do rather well. God knows, they've had enough practice over the last few millenia.

It is true that they have not always done this well. The ancient Persian empire taxed all the coinage out of the empire's economy, leaving it in ruins across the middle east. The only good thing Alexander the Great did was loot the royal treasuries and put all the money back in circulation. The economic revival was huge within half a generation. In general however, governments have done this job pretty well; even the mediaeval monarchies were extremely vigilant about defending the honesty of the coinage.

So, we can agree then that government has two indispensable functions for free markets: money supply and the judiciary.

On anarchy, just because it's old doesn't mean its any good. Iceland's judicial system was a horror, and it's system of government cannot be described as anarchic. Its althing was really more a direct democracy than anarchy. Iceland had laws, hence, not an anarchy.

There is a generic form of government
with respect to the specific instances indicated in my other posts with respect to markets. Whether a Roman imperialism, a Greek direct democracy, a mediaeval monarchy, a Stalinist dictatorship or a representative republic, all governments regulate markets through currency stability and contract enforcement. In that limited sense, there is a generic form called government. It is as necessary for existence as markets are for existence, and the two cannot be separated. All discussion on this in reality is the degree to which government should be a participant in the market and the degree to which it should prescribe what items or commodities are bought and sold and the degree to which it prescribes the prices paid. All governments, to some degree, also do all of these things. Whether this is advisable or not is another matter entirely.

not true
The development of coinage has always been primarily a govt responsibility. The instances of the private issuance of money are few and far between.

There was a time when banks were allowed to issued money, the problems arose because individuals weren't willing to trust script from out of area banks. They had no way of knowing which script were from real banks, and which were frauds. Modern technology largely solves this knowledge problem. Of course trying to keep track of the excange rates of thousands of banks would always be a problem.

The only role govt has ever had in the providing of a free market, was the role of enforcing contracts. This role can also be provided by private agencies. In fact, private agencies are providing an ever growing percentage in todays world. We usually call them mediation services.

Same goes with the judiciary.

I happen to believe that the free market can provide all of these services more efficiently than govt can.
However, if govt were to limit itself to the ethical deliverance of these three services, I would have no objection.

close enough
this is not quite true, I don't think

>all governments regulate markets through currency stability and contract enforcement

Lots of cultures didn't use currency. And imany places contract enforcement is done by clan or tribe members. But for modern, complex societies, yes, sure. And I'm in complete agreement on this:

>All discussion on this in reality is the degree to which government should be a participant in the market and the degree to which it should prescribe what items or commodities are bought and sold and the degree to which it prescribes the prices paid. All governments, to some degree, also do all of these things. Whether this is advisable or not is another matter entirely.

On coinage
we agree, with the additional note that the increasing size and scale of the world economy appears to be moving in the direction of decreasing the number of currencies, not increasing them. This is an historic trend which first started in the 1600s(?) with the international trading systems developing through the banks in the Netherlands and London. It suggests there's an economy of size with currency, namely bigger is better for a currency to hold its value.

With respect to the judiciary we agree on the limited role of government in the market. I am not as sanguine as you are about the ability of the private sector to provide contract enforcement without ultimately becoming a "paint the walls" mechanism so beloved of la cosa nostra.

Reading List: Conclusion- Gov't Money Regulation-almost never done well.
Money Mischief, Milton Friedman

The Vandals Crown, Gregory Millman

I suggest that after reading these books, you will have quite a different perspective on the regulation of money.

Seignorage did tend to mitigate the opportunities to debase specie or commodity currency, however, governments have engaged in devaluations of their money, primarily to stimulate exports by making their currency cheap vs. others.

sure can make historical comparisons
In China, and arguably in dark ages Europe, powerful rulers suppressed technology out of a desire to hold their realms constant.

Similarly the communist states sought to suppress markets out of belief that enlightened central regulators could better answer societal needs.

Technology does not develop in a vacuum. People are unlikely to experiment and work to build a waterpowered grain mill only to have a greedy ruler or a labor agitator or a religious fanatic or a social leveller destroy it, confiscate it, or tax it into the ground.

You get no argument from me
on the fact that governments have sometimes, even frequently and sometimes hideously, distorted their own currency in their own interests. Debased currency effectively functions as a flat tax, hence its regressive nature, on all those who use it. The worst abuses were not encouraging trade; the worst abuses were in devaluing their own currency to allow them to meet their costs of government operation. Some Roman administrations were doing this constantly (Caligula and Nero to name just two) and the result was chaos. Of course abuses have happened, and frequently. The point is that currency as we understand it could not exist without government.

Therein lies the problem
"The point is that currency as we understand it could not exist without government."

Currency as we understand it is a grand lie, subject to manipulation and the government monopoly has so crowded out the debate that most people lack the will to imagine life where their economic position is unaffected by some unaccountable bureacrat known as the "federal reserve chairman".

"Debased currency effectively functions as a flat tax, hence its regressive nature"

No, it doesn't, because it affects (screws) net savers over net debtors. That is a different concept. Debasing currency is a theft of wealth, income taxes (flat or otherwise) consiscate earnings.

A flat tax is not regressive. It is neutral, even without deductions or exemptions. You can make it as "progressive" (I prefer the more descriptive terms, "discriminatory" and "punitative") as you want with deductions and exemptions/

America-- more socialist than Niger
I find it interesting that the author should say "People in Niger and North Korea are starving to death now, even though the technical knowledge for growing and distributing basic foodstuffs is readily available across the globe."

As it happens, the reason Niger and its neighbors are unable to compete in bringing their one cash crop-- cotton-- to market is because the price their small cotton farmers have to charge is being undercut by heavily subsidised American cotton. They can't beat our prices because the US taxpayer is enabling this crop to be dumped on the world market at below-production prices.

http://www.cid.harvard.edu/cidtrade/geneva/cotton.html

http://www.guardian.co.uk/famine/story/0,12128,998666,00.html

http://www.irinnews.org/report.asp?ReportID=55034&SelectRegion=West_Africa&SelectCountry=BURKINA_FASO

Of course in the wondrous world of globalisation the American cotton industry is free to lobby its government to the full extent of its economic clout-- as are barefoot cotton farmers in West Africa's cotton belt. Only our growers got four billion in public money, while theirs got none.

More than that
"Currency as we understand it is a grand lie, subject to manipulation and the government monopoly has so crowded out the debate that most people lack the will to imagine life where their economic position is unaffected by some unaccountable bureacrat known as the "federal reserve chairman"."

We know what life is like without the illusion called currency; it's called a barter economy, and it couldn't work even in neolithic times let alone current ones.

"No, it doesn't, because it affects (screws) net savers over net debtors. That is a different concept. Debasing currency is a theft of wealth, income taxes (flat or otherwise) consiscate earnings."

More than that, a debased currency hurts everyone who buys goods or services. I called it regressive because it hurts worst those who have the least.

and - lack of technology to cure smallpox does not imply lack of technology
In olden days before nation states long distance trade was of very valuable and desirable items given the danger, then, of trading in a world where a stranger might be just as soon attacked as welcomed.

Trinkets had value then as they have value now; but other things also had value for arguably more practical reasons.

Meteroric iron, native copper found in the Great Lakes region (among others), flint and volcanic glass were all traded, as were tools and weapon points made from the same. All of these items were very high technology to someone whose next meal depended on piercing the thick skin of a prey animal.

Small scale local trade was also important for technology reasons. Presumably the best flint knapper, bowyer and potter were high status members of the tribe, and also very valuable resources of the tribe, not to be risked in battle for instance. They no doubt got some direct benefit when the goods they produced were traded to other tribes or bands.

On cultures
"Lots of cultures didn't use currency. And imany places contract enforcement is done by clan or tribe members."

This statement of yours is true, but it's not surprising that very little social complexity is necessary before currency becomes vital. Even pre-Columbian neolithic cultures in North America required currency and in a form we recognize.

money is a grreat invention, no question
& paper money was another, and so was double-entry bookkeeping and letters of credit. Technology works!

Not suggesting barter
The question isn't between currency and barter, the question is between a fiat currency regulated by the government and perhaps something else. The regulation of international currency flows is now largely private. Government stupidity is met with swift retaliation in Chicago and other cities. Indeed, there's a tacit admission private markets provide the best indicator of the total need for currency, as the Fed uses commodity prices as indicators to determine the need for money growth.

A debased currency doesn't hurt "everyone who buys goods or services", it hurts individuals who have a long position, e.g., savers. If I buy on credit and I get to pay back cheaper dollars, I'm not hurt, I benefit. Creditors LOVE inflation for that very reason.

I'm sorry, but you need to brush up on basic monetary economics.

Sign of the Apocolypse -Roy finds a problem and argues it correctly.
Roy actually makes a coherent argument. Ok, its laced with the normal rich v. poor but its dead on.

So shall we count you as those who understand that vesting to much power in government (in this case, ag subsidies) is what led Mencken to quip, "every election is an auction in advance, of stolen goods".

Of course the problem is the ag lobby remains powerful. No, the grainge halls are empty, but we still have ADM (ever wonder why Dwayne Andreas was such a wild-eyed lover of socialism???)

An interesting aside case is the Amish. They do not use all...
...technology but they do use some. They are very non-violent though, and work hard.

You could also look at certain other sections of the USA where violence is pravalent.

I have not fully thought this through. I am just offering fring cases where data might be gleened.

Basic monetary economics
shows that a debased currency reduces buying power. A debased currency is inflationary and we know well the effects of that.

"paint the walls"
Ultimately, all judicial authority boils down to somebodies willingness to use force.

You'll never find me supporting any govt subsidy,
but a finding that the US is more socialized than Niger in one area, is not evidence that the entirety of the US economy is more socialist than that of Niger.

Niger socialist?
A political scientist would not consider Niger to be a socialist state because there are no good to redistribute. Everyone lives at a subsistence level. Their gross domestic product is not quite $1,000 per person per year ($9-10 billion GDP in an average year, 11.7 million people).

The GDP is derived exclusively from uranium and foreign aid. Thus there is nothing to tax, hence no taxation. No wealth to be distributed. The people get nothing from their government and they give nothing to the government.

https://www.cia.gov/cia/publications/factbook/geos/ng.html#Econ

The United States, on the other hand, gives quite a bit of its wealth away to favored individuals and corporations. We have given, for instance, gold reserves in Nevada worth three billion dollars (est.) to Barrick Goldstrike, in exchange for a princely $10,000 payment into the US Treasury. This was a parting gift from our 41st president as he was leaving office. In exchange the president's political party received $100,000 in campaign funding.

Quite a nice rate of return, wouldn't you think? In exchange for payments totalling $110,000 Barrick picked up a mountain of gold.

http://www.commondreams.org/views01/0721-08.htm

http://www.truthout.org/cgi-bin/artman/exec/view.cgi/47/16753

So with this forced redistribution of your income and mine, we have seen $10,000 enter the public kitty and resources worth three billion leave our hands. And that's not all, folks. We also have the hydrology of Nevada permanently altered, unless we pay to cap the holes after Barrick is finished taking our gold.

That, I would say, is an example of corporate socialism.

Niger socialist
because everything is run by the state.

Yada yada
Offer some evidence that "everything" in Niger is being run by the state.

The state does not touch anything in the lives of its people. They continue to exist at subsistence level, while the state controls the export of yellowcake ore and spends such money as the donor community is still willing to give it on Benzes. You are merely offering us your opinion, in the guise of objective truth.

your own post proves my point
"The state controls the export of yellowcake ore."

This only happens in socialist countries.

You're on the right track, brother
God evicted Adam and Eve from Eden so that we'd have to compete with nature for our sustenance. Otherwise, life would have no cost and no value.

Cain showed Abel the price of competing violently for primacy. But the Protestant work ethic excludes violence as a currency redeemable for primacy. What remains is Jonah's price, or in New Testament terms, the Parable of the Talents. That is, every believer must do what he is best at and trade for the rest, all the while giving God the glory for every talent and its increase.

For His kingdom will come when His will is done, on Earth as it is in Heaven.

A poor definition
The yellowcake business is the only business in the entire country. So it is being organized and run by the only organized group of people in the country-- the government. That's hardly socialism, it's just a lack of competition.

Now if the government were exporting ore and then using the proceeds to uplift the standard of living of its citizens-- now THAT would be socialism.

Roy picked cotton, but a much more interesting example is being initiated
Countries that want to sell cotton are no doubt suffering some economic harm from U.S. subsidies that discourage cotton imports, but you ain't seen nothing yet.

One of the enviroweenie big shots pointed out the other day that filling the tank of a large SUV one time with ethanol uses up as much corn as it takes to feed one person for one year. And an iron triangle of interest groups is developing which is moving more and more of U.S. corn production toward ethanol production because the environmentalists like the supposed greenness of turning oil into corn before burning it in engines and because both political parties like the votes of the enviroweenies and the green filled envelopes they get from the corporate farmers and the corn processors.

Corn prices have not yet reacted to the increased demand created by forcing ethanol use. When the prices of corn and other grains do react those folks all over the world who rely on cheap corn to eat are going to get a very rude surprise.

At that point Roy will really have something to pluck heart strings about.

Roy picked cotton, but a much more interesting example is being initiated
Countries that want to sell cotton are no doubt suffering some economic harm from U.S. subsidies that discourage cotton imports, but you ain't seen nothing yet.

One of the enviroweenie big shots pointed out the other day that filling the tank of a large SUV one time with ethanol uses up as much corn as it takes to feed one person for one year. And an iron triangle of interest groups is developing which is moving more and more of U.S. corn production toward ethanol production because the environmentalists like the supposed greenness of turning oil into corn before burning it in engines and because both political parties like the votes of the enviroweenies and the green filled envelopes they get from the corporate farmers and the corn processors.

Corn prices have not yet reacted to the increased demand created by forcing ethanol use. When the prices of corn and other grains do react those folks all over the world who rely on cheap corn to eat are going to get a very rude surprise.

At that point Roy will really have something to pluck heart strings about.

Minimized violence
Lemuel wrote: 'Too much government intervention in markets can be disastrous. Too little, or corruptly managed government is equally bad, as the examples brought forth regarding technology not being enough illustrate. '

Some societies that were very non violent (Quakers in Penn. for a time refused to establish Gov. and collect taxes and, Icelanders where 400 years without government) thrived without Government or with very little Government (It is theorized that the renaissance occurred in Italy and Germany because they had no central Gov. and cleaver people could move to another city state without leaving all behind and learning another language).

So how do we determine at which point government action is negative. IMHO it is the point at which it increase the amount that is done through violence and the threat of violence.

I think that governments should exist to suppress violence. We give them a monopoly on the use violence for this purpose. (Also they should govern the use of traditional public property IE local roads/water ways/air/ground water at least until these can privatized if ever which is related as pollution can do violence.) If they go too much beyond that things can get worse rather than better.

The danger of the democratic welfare state is that so many people receive their daily bread through the states threat of violence (taxation) and they vote themselves money and at some point those earning a living by production become the suckers.

In dictatorships dictators often deliver goods to their region and or ethnic group in order to get that group to help them stay in power.


Do not take a cruse!..
...There is no Government on the high seas.

The market for illeagal drugs exists apart from Government...
...and people mostly get what they pay for. That despite the fact that the trade atracts the the most ruthless peole in society.

America-- more socialist than Niger - perhaps but less is done through...
...violence.

BTW There are many other very large factors.


A couple of points
The references to Italy and Germany are not quite right. Both had plenty of government and were each divided, respectively into dozens and nearly a hundred, largely sovereign states. These states, particularly in Italy, had a far higher degree of control over their citizens than the mediaeval regimes they had developed from.

Both regions were at the time of the Renaissance highly violent. Italy was convulsed with warfare between the Italian states and with various foreign invasions, mostly France and Spain. In the case of Germany, there were the extensive wars of the Reformation, including a huge peasant revolt that was only put down with something approaching a quarter of a million fatalities.

Neither region illustrates therefore a lack of government. The Renaissance happened in large measure because Italy was Europe's principal finance and trading centre during the 15th and 16th centuries. As the financial hub of Europe moved during the 17th and 18th centuries to London,Amsterdam and Paris, so too did the centres of learning, science and culture. And financial hubs only develop because of strong, secure governments with strong, secure commercial law.

Oh yes there is
He's called the ship's captain.

That's the point
If you really want to do away with vehicles and go back to pre-industrial peasantry, it's not much use to argue about obscure things like global warming (Good thing, if true it will reduce my winter heating bills, says Joe Paycheck). It's much better to be able to argue that by filling your tank your killing about 50 people a year through starvation.

Now perhaps we see how truly vicious the green lobby really is.

And just how is it that the govt is the only entity allowed to produce the yellowcake
perhaps it's that the govt jailed, or killed anyone else who wanted to do it.

"Now if the government were exporting ore and then using the proceeds to uplift the standard of living of its citizens-- now THAT would be socialism."

No, that would be a miracle. Govt uplifting anyone's standard of living has never happened. (With the exception of those who run govt.)

Golden Opportunity
Roy, Roy, not that old chestnut again. The gold has not been given away. First much capital investment must be made before the first ton of ore comes out of the ground. Many people will have to be hired, local, state and federal taxes will be paid out of the wages. The employees will purchase goods in the area, increasing trade and, wait for it, more taxes. After the additional expense of refining the gold, when the company sells the gold for profit, guess what, more taxes. While the gold is in the ground we have an unrealized asset which has no effect on our economy, good or bad. Barrick will provide a return on that asset. Now, if you want to argue that $10,000 is too little, I'm with you. The govt is an idiot as a businessman. The should, rather, auction the leases (and require clean-up after the lode is finished) and try to get the true mkt value.

Insufficient words
Your message a bit too terse to be informational. Unaware Niger has any special problem with violence. "Other factors" can only be guessed at. Please amplify.

Factors you've omitted from your argument
First, one could also say of the gold in Fort Knox that it is also an "unrealized asset", in that it has not yet either been used to purchase something or been given away. It is equal in status to a certificate of deposit, that has not yet been exchanged for money and for which there is a substantial penalty for withdrawal.

If you have in your possession gold reserves worth $3 billion, and the effort involved in removing the overburden was priced in the many tens of millions, would you exchange it all for $10,000? Or might you consider keeping it there for posterity?

Besides, this gold was not there for the convenience of an outgoing president. It belongs to the American people. The federal government is only the caretaker. This is an extremely important point-- that in fact the gold does not belong to the government.

The extraction of this gold will not go to boosting the economy in the area. It is in an uninhabited portion of Nevada. Other than the paychecks for a couple of hundred jobs, ALL the profits are being repatriated to Canada, home of the parent corporation.

Next, you're asking me to believe that GHW Bush, a principal in one of the most sophisticated investment groups on earth (the Carlyle Group) was so naive he did not realize it might be a mistake to abruptly sell off a mountain of gold for $10,000. When in fact it is interesting to note that after leaving office he became a paid consultant for Barrick, helping them in the pursuit of subsequent acquisitions around the world.

Let me ask: are you familiar with the term "revolving door"?

Let me ask also: if given a choice, would you rather have the federal and state taxes owed from possibly two hundred paychecks? Or would you rather have three billion dollars worth of gold? I highly suspect that Barrick, as a Canadian corporation, pays zero in federal taxes on their repatriated profits.

Finally, did you forget all about the fact that they are leaving behind a hole in the ground large enough to alter the entire hydrology of this extremely arid state? And that in the forseeable future Las Vegas is going to greatly regret the loss of the immense quantities of water they have just pissed away by letting it evaporate in catchbasins? And that someone, owing to peculiarities in Nevada law, is going to have to pay for the repairs required to save the remainder of the aquifer, for which Barrick is not legally liable?

These are externalities that further alter the picture from the rosy one you are describing.

BTW Roy freedom is not the opposite of socialism. You are free to start a socialist...
..community here in the USA. You just cannot force people into it or force people to stay in it. What you are asking for is that more force be used in our daily lives. The choice is not between socialism and lack of socialism but between freedom and force.

I am no expert on Niger (are you?) but in the 3rd world countries that I am familiar with force (violence) is a big part of how goods and services are distributed and what economic activities are suppressed.

But I believe Niger is sparsely populated and thus has a poor division of labor and was late to the modern world etc.

Are you trying to say that if Niger was more socialist than the USA it would be richer than the USA. What is more socialist Hong Kong or Niger? North Korea or South Korea?


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