It’s true, Fellow Reckoner…the Empire has no clothes on. It’s running out of (credible) money. And its outlook “just” turned negative. Even the wizards at S&P Ratings have said as much…so it MUST be so!
And yes, it’s true that unemployment levels remain stubbornly rooted in economic reality…that home prices are still falling, even as sales are drying up…and that prices from the grocery store to the gas pump are on the rise, thanks, in large part, to arrogance and/or ignorance from the nation’s central banking cartel.
It is true, too, that what was once seen as the freest, bravest nation in the world is fast succumbing to a toxic cocktail of prison-state policies at home and military strongmen attitudes abroad. In the end, such aggressive domestic and foreign policies are as expensive as they are futile…and, ultimately, fatal.
But let us not despair, Fellow Reckoner. Every coin has two sides. Perhaps the sugar in your editor’s caipirinha has gone to his head…or maybe the stunning local fauna here on Brazil’s hottest beach has temporarily impaired his judgment…but we are nevertheless inclined to believe that there is much in the world to be happy, and hopeful, about today.
Governments around the world are coming under increasing financial stress, yes. But this isn’t necessarily a bad thing. In fact, it’s inevitable, as every once-proud, now-fallen state throughout history shows us. To be sure, the times ahead certainly deserve a healthy dose of caution. But, for freedom lovers the world over, they also inspire cautious optimism. Permit us to explain…
Right now – as in today, this very moment, as we type – more people are working in and gravitating towards the freest marketplace that ever existed: the Internet. Hundreds of millions of people from Tehran to Tucuman, from Cairo to Columbus and beyond are trading, exchanging and working together without (or, at least, a long way ahead of) the overreaching arm of the state to regulate them into the ground. They are building new business models in everything from the exchange of everyday goods and services to raw information and, most importantly, ideas. You can now do things from your desktop – or laptop…or the palm of your hand! – that would have been unimaginable even 15 years ago. You can book hotels and flights, coordinate intercontinental conferences between like-minded individuals, sell (or buy) your (or another’s) family heirlooms, download music, books and games, purchase theatre tickets, self-diagnose illnesses, trade stocks, bonds and precious metals, view independent financial research, even sit in on Ivy League economics courses (if you were really desperate for something to do…or just looking for a laugh). The list is infinite…and growing by the second. You can probably think of a hundred other applications right off the top of your head…
The Internet is also playing a crucial role in the battle against the state, against tax slavery and the old, antiquated notion that we are free only to the extent that we are “permitted” to be free. It is hardly surprising, then, that the Internet now “employs” more people than any other industry in the world. More people buy and sell on eBay, for instance, than work for the entire United States government. Facebook has a “population” of 664 million people – around 10% of the entire population of the world…and it’s not even in China yet! – who are voluntarily organizing themselves into groups of common interest and exchanging information (however tedious such exchanges might sometimes seem: “OMG, just popped out to get a delish mocha latte!! Kisses!!!”).
And, as you would expect in a free market, people tend to initiate and enter into exchanges with others based on conduct and on the reputation that derives from it. Witness Airbnb.com, a hub where individuals can host and rent accommodation all over the world. Simply type in a destination you would like to visit and cruise through the hundreds, sometimes thousands, of available spaces. Or post your own space for a bit of extra rental income. Often times, the decision to rent a room – or an apartment, penthouse, igloo, whatever… – comes down to “likes” or “digs” or the weight of recommendations posted by other users. Thus, both hosts and guests are impelled to treat each other with common courtesy and to make sure they deal in an honest fashion, lest they find doors closed in their faces or unlet rooms in their own house.
[Your editor and his girlfriend have enjoyed a wonderful apartment here in Leblon Beach, Rio de Janeiro, for the past ten days or so. We rented it from a young couple – she Colombian, he Swedish – who use the site to make some extra cash on the side. We could scarcely have met nicer people and the place – clean, quiet, exactly what we were looking for – was about half the price of nearby hotels.]
To those who would scoff at the triviality of social media or the pie-in-the-sky promises and possibilities of the Internet, we would remind you that we are in the very early stages of development here. Yes, there are many “teething” problems. This is first generation stuff, after all; the Internet’s equivalent of a crude feudalism. And yet, next to the decidedly sub-evolved, freedom-averse, dead weight of “the state,” it looks pretty darn good.
It is important to remember that freedom is an idea, not a point on a map. As such, no single place can ever hope (nor should it) to contain freedom. The moment the state – any state – even attempts to impose restrictions on it, freedom – and those who value it – begin moving elsewhere…naturally.
The State is Falling…and Other Reasons to be Optimistic originally appeared in the Daily Reckoning. The Daily Reckoning recently featured articles on stagflation, best libertarian books, and QE2 .