Economic theory

Today I read about some of the excerpts for Mein Kampf. The one I found interesting here on page 84 is about Hitler's idea that economics is not the responsibility of the government.

"The state has nothing at all to do with any definite economic conception or development...The state is a racial organism and not an economic organization...The inner strength of a state coincides only in the rarest cases with so-called economic prosperity; the latter, in innumerable cases, seems to indicate the state's approaching decline...Prussia demonstrates with marvelous sharpness that not material qualities but ideal virtues alone make possible the formation of a state. Only under their protection can economic life flourish. Always when in Germany there was an upsurge of political power the economic conditions began to improve; but always when economies became the sole content of our people's life, stifling the ideal virtues, the state collapsed and in a short time drew economic life with it...Never yet has a state been founded by peaceful economic means..."

He says here that a strong economy cannot exist without a strong government and a strong government will inevitably bring about a strong economy. Yet it is when the government begins to get involved in the intricacies of the economy, and the people become obsessed with the economy and not the practices of the state, both will shortly collapse.

I like this excerpt because of the current stock market situation and the steady decline of the Dollar to the Euro. The American economy has risen and fallen with the times I know, but there has been multiple occasions where the government has interfered and our economy has never truly rebound.

Example 1:
The removal of the US dollar from the gold reserve. In other words, we told the world that we did not need the gold to back our money. (We actually do not have enough gold in the US to cover all of the money in circulation.)

Example 2:
The Fed Reserve bank at the request of the US Gov, has continually cut interest rates in order to try to stabilize the economy, with little or no success. The Interest rate cuts have helped the decline of the dollar in the world market.

Please continue this discussion in the comment section below. Lets see what you think the quote might mean.

Good day again....

Dan

The Economy

Today I read about the fall of the German economy. I shall take this time to write some of the interesting facts pointed out in the book.

"The Mark, as we have seen, had begun to slide in 1921, when it dropped to 75 to the dollar; the next year it fell to 400 and by the beginning of 1923 to 7000."

"The stangulation of Germany's economy hastened the final plung of the mark. On the occupation of the Ruhr in Jan. 1923, it fell to 18,000 to the dollar; by July 1 it had dropped to 160,000; by August1 to a million. By November, when Hitler thought his hour had struck, it took four billion marks to buy a dollar, and thereafter the figures became trillions. German currency had become utterly worthless. The life savings of the middle classes and the working classes were wiped out."

"The inflation could have been halted by merely balancing the budget--a difficult but not impossible feat. Adequate taxation might have achieved this, but the new government did not dare to tax adequatley. After all, the cost of the war (WWI)-164 billion marks-had been met not even in part by direct taxation but 93 billions of it by war loans, 29 billions out of Treasury bills and the rest by increasing the issue of paper money."

"From the on, goaded by the big industrialists and landloards, who stood to gain through the masses of the people were financially ruined, the government deliberately let the mark tumble in order to free the state of its public debts, to escape from paying reparations and to sabatoge the French in Ruhr. Moreover, the destruction of the currency enabled German heavy industry to wipe out its indebtedness by refunding its obligations in worthless marks. The General Staff, disguised as the Office of Troops to evade the peace treaty which supposedly had outlawed it, took notice that the fall of the mark wiped out the war debts and thus left Germany financially unencumbered for a new war."

I find this point of history particularly interesting, given our present economic situation, because the government and the mass media outlets do not make it known why we are losing ground to the Euro. The US dollar is currently worth the least it ever has been and there are no reasons as to what is going on. Gas prices are continuing to soar and the reason given is because of lackluster oil productions and "terrorism". The real reason that it is costing more is because the value of the dollar is plummeting.

Interesting similarities can be made here and I hope you can point out those I have missed.

Good day,

Dan

Is The Past The Key To The Future?

I have been reading a book called 'The Rise and Fall of The Third Riech', in order to better understand how a mortal man was able to raise himself up to a godlike status and be tolerated by the people, all the while torturing and tormenting a majority of the population. Now while I am only about 63 pages into the text, (63 out of 1200 or so), I have discovered some striking similarities between what was going on in Germany post WWI and pre WWII and what is going on today in the US. I will make it a point to detail my findings and thier implications to our modern society as I continue to read.

I hope that you find this as compelling as I do, in order to maybe, oh..i don't know..., learn from our mistakes while we still can.

Thanks for reading.

Dan