Miyerkules, Setyembre 12, 2012
Lunes, Setyembre 10, 2012
This final article about the value of the US dollar serves as a transition to our next subject, the Gold Standard. This article is based on the speech of Congressman Ron Paul dated June 5, 2002. Compared with the previous two speeches on the same subject, we see here a progression in the way the value of the US dollar has been treated. Ron Paul indicated in July 20, 1979 speech that the US government was guilty of destroying the dollar. In September 6, 2001 speech, the Congressman reminded the US Congress of their constitutional responsibility to protect the dollar. After 9 months, this June 5, 2002 speech shows that the US Congress is not fulfilling its responsibility to protect the value of its own currency.
Reading the last speech, I keep on encountering familiar themes that have already been mentioned in previous speeches like the connection of the price of gold and the dollar, inflation, the loss of trust in the US dollar, social tensions, and the call to return to gold standard. This only shows that the call of Dr. Paul for change in monetary policy has been ignored even after several decades of admonishing the US Congress.
Instead of protecting the dollar, the Congress, says Dr. Paul, is either deliberately or by default promotes a monetary policy that erodes the value of the dollar. This erosion is dangerous not only to US economy, but also to world economy since the dollar is the reserve currency of the world.
Repeatedly and consistently, despite of the Congressman’s awareness that politicians dislike the limiting power inherent in a monetary connected to gold, he has kept on reminding the US Congress about its task to maintain a stable currency by attaching the dollar into gold once again. He believes that monetary history and economic laws show the value of a stable currency in maintaining a system of healthy economic growth and wealth preservation.
Creator of heaven and earth and the Ultimate Owner of all things, I pray that you remove whatever forces that exist in the US Congress that prevents reform of monetary policy leading to a sound, honest, and stable system of currency. Grant knowledge, courage, and tenacity for lawmakers and politicians working to see this change. Help us enjoy your gift of freedom through the Gospel of your Son. Help us live in peace and productivity.
Eight years after President Nixon removed the connection of the US dollar from gold, Congressman Ron Paul delivered three speeches about the value of the US dollar. The first speech was given on July 20, 1979 admonishing the US government to stop the destruction of the value of the dollar. Two months after, on September 28, the second speech was delivered and it is about the connection of the changing prices between gold and the dollar. The last speech was given one month after, on October 17 and it concerns about the relationship between the dollar and inflation.
Stop Destroying the Dollar
Simply reading the first speech, one wonders why the Congressman was talking about the US government to stop destroying the dollar. If only an ordinary person is making this charge, people can easily dismiss it that the person talking is out of his mind. But it was an American Republican Congressman himself who upholds personal liberty, the US constitution, and the free market issuing this warning. The public is missing something important if we fail to grasp why the Republican Congressman was insisting that the US government is indeed destroying its own currency by increasing its supply. We are missing to see the implications of this act of dollar destruction on our personal and economic freedom.
The Gold Panic
The second speech about the relationship between the values of dollar and gold makes me think of the present trend among investing advisors counseling their clients to protect their wealth by buying gold. Good for those who have extra cash to follow such advice.
After reading the second speech, I realized that the gold panic has already started 33 years ago. I have no Internet access upon writing this article and therefore have no way to know the exact price of gold in 1979. The only data I have is that in 1995 the price of gold per ounce was $380.90 and the last time I checked its price two months ago was $1,615.00 per ounce. In other words, in 1979, the price of gold was far below $380.90 per ounce and yet there was already an indication of panic that time. The question is: if there was gold panic in 1979 when the price of gold was still very low, how people now ought to respond when the price of gold has already reached $1,615.00 per ounce? I am thinking that perhaps the conventional answer works within the span of 33 years that the gold panic that Ron Paul mentioned was somehow cooled down. Or maybe we are in the latter stage of that panic. Or perhaps, there are still other reasons. I do not know.
All I know is that the increasing price of gold is an indication of the declining value of the dollar resulting from its continuous creation out of thin air. Just a week ago, I read George Soros and central banks storing gold. One writer indicates that such action is a preparation for something big that is about to happen. For Ron Paul, such big shift is a sure sign that increasing number of people all over the world no longer trusts governments and fiat money. The only way to calm the panic is to stop printing fiat money and restore the official connection of the dollar to the gold once again.
Strong Dollar is a Deception
One month after that second speech, the Republican Congressman delivered another speech concerning the value of US dollar. In this speech, Dr. Paul exposed the prevailing deception reported in mainstream media that the dollar was getting stronger. It was a deception for the whole story was not told to the public and the basis measuring the strength of the dollar was misleading.
For Ron Paul, compared to other currencies, the dollar could appear strong simply because other countries were also inflating their money supply. Instead of using other currencies, Dr. Paul suggested two reliable tests to assess the strength of the dollar: in terms of its purchasing power and in relation to the price of gold.
Which of the two is telling the truth, the report of the mainstream media or the speech of Dr. Paul? Obviously, the two are not telling the same thing. Believing one would mean disregarding the other. Unfortunately, only few are able to see beyond the appearances of things due to absence of education in Austrian way of thinking.
I am done with inflation. It is now time for me to study the value of US dollar from the speeches of Congressman Paul. The speeches are taken from Part 5 of the book, Pillars of Prosperity. There are actually 6 speeches concerning the value of the US dollar. I selected the longest one, which Dr. Paul delivered in February 15, 2006 at the US House of Congress. Its title is The End of Dollar Hegemony.
Meaning of Hegemony
I first encountered the word “hegemony” while taking my Ed. D. at AGST. Despite of repeated reading and listening, still I find it hard to remember the exact meaning of the term. When I encountered the word again in my study of Pillars of Prosperity, I tested my memory if I could still remember the meaning of the term.
Hegemony to me is a kind of unjust or oppressive mainstream practice or system that the victims of it delight in perpetuating. Then I checked the meaning of the term in the New International Webster’s Dictionary and Thesaurus. The definition given is “predominant influence of one state over others as in a league or alliance.” I forgot where my definition came from. It is obviously subjective, but I prefer it.
Concise Lecture on Monetary History
The Congressman’s speech on dollar hegemony centers on the future of US dollar. He was talking about the end of its hegemony. He did not specify the precise date that his foresight would take place. All we know is that after six years of delivering this speech, we are now nearer to see its fulfillment.
Dr. Paul did not use a crystal ball in his prediction. He is well-informed about the history of money, the power of the market, and the abuses of the governments once they gained monopoly over the money supply. He gave us a concise lecture on monetary history that includes taxes, inflation, fiat money, militarism, imperialism, moral decline, and the downfall of empires. In this piece of history, he narrated the transition from the “dollar diplomacy” during the time of William Taft in late 19th century to “dollar hegemony” in the second half of 20th century.
The Transition to Dollar Hegemony
I understand the “dollar diplomacy” as an attempt of the US to protect its commercial interests in the Far East and Latin America from European influence. The transition took place as new monetary policy was introduced and that the US dollar has also undertaken a radical change. Dr. Paul was referring to the printing of the US dollar since the creation of the Federal Reserve in 1913 and its separation from gold standard that started in 1971. Through these changes, the transition to “dollar hegemony” was achieved.
Another special arrangement that added dominance to the US dollar was the “agreement with OPEC to price oil in U.S. dollars exclusively for all worldwide transactions” (p. 261). The other side of this agreement was the maintenance of US military presence in the Persian Gulf to protect its own interests.
Depreciation, Loss of Trust and Use of Force
The Congressman mentioned other details exposing the distortions in the new economic and monetary systems resulting from dollar hegemony. However, the new systems were gradually eroding the value of the US dollar through the increasing quantity of money supply. As nations of the world would come to realize the decreasing value of the US dollar, we would also see the end of the dollar hegemony.
A typical and controversial example of this loss of trust in the US dollar was the decision of Saddam Hussein in November 2000 to demand Euros for his oil. Such decision was a threat to dollar supremacy. It is alarming that in the following year, 9/11 took place and the dominant rhetoric was about Saddam Hussein and the overthrow of his government. Seen from this perspective, it is logical to think that the war against Iraq was actually a war to maintain the supremacy of the US dollar. Dr. Paul shared similar stories concerning Venezuela’s and Iran’s loss of trust in the US dollar.
Using force to maintain the supremacy of US dollar, the real victims are unaware about the manner they financially support the perpetuation of these new systems. Dr. Paul explains the subtlety of the scheme:
“The license to create money out of thin air allows the bills to be paid through price inflation. American citizens, as well as average citizens of Japan, China, and other countries suffer from price inflation, which represents the ‘tax’ that pays the bills for our military adventures” (p. 267).
No wonder the people remains passive. This is not reported in mainstream media. Conventional education does not train us to think this way. And so the dollar hegemony continues to thrive through the use of force and US militarism in return depends on the ongoing supply of fiat currency. This connection between militarism and the US dollar is clearly expressed by Dr. Paul: “Ironically, dollar superiority depends on our strong military, and our strong military depends on the dollar” (p. 268).
The golden rule has been changed. For several decades, the US dollar has been considered the “new gold” and its printers have been making the rules. But the times are changing. The dominance of the US dollar is about to end. The free market will demand a return to monetary system based on honest money.
Huwebes, Setyembre 6, 2012
After sharing my summaries of Parts 1 and 2 of Pillars of Prosperity, I decided to skip Parts 3 and 4 to directly deal with Part 5, which I think is the heart of the book and most relevant for our time. In Part 5, Dr. Paul discussed Money and Banking: Gold versus Fiat. I intend also to forego the remaining Parts of the book and thinking of studying the next book, The Case for Gold from my list of priority reading. However, I am still unsure about the direction of my mind. It still depends on my interest.
In studying Part 5, instead of following the usual order of topics as presented in the book, I am thinking of rearranging the topics on the basis of repeated subjects. I find at least 9 interesting subjects. They include inflation, the value of US dollar, gold standard, Federal Reserve, monetary policy, fiat money, economy, honest money, and tyranny.
To provide the bird’s eye view of the location of Part 5 in the overall content of the book, allow me to share the 9 main parts of the book. Part 1 is about The Economics of a Free Society. Part 2 talks about Mises and Austrian Economics. We are finished with these two Parts. Part 3 deals with Reforming Social Security. Personally, I lack interest to read this part. I assume that most of its contents are directly applicable to American context. Part 4 is a pleasurable reading for me. It is about Giving Money Back to the Taxpayers. I just wish in my heart that we have a Filipino politician who has the knowledge and the courage to pass similar bills in the Philippine Congress. Part 6 is about Free Trade: Real versus Phony. This could be another interesting study for me after Part 5. Part 7 is about International Affairs. Part 8 deals with the role of the government in housing market and Part 9 ends with Spending, Taxes, and Regulations.
I want to start with inflation. And there are 6 relevant speeches dealing with this specific subject.
First and Second Speeches
In his first speech dated February 15, 1979, Dr. Paul described inflation as a “destructive process” that the members of the US Congress were not able to stop due to erroneous understanding of the term.
In October 17, 1979, the Congressman contradicted the popular opinion about the US dollar getting stronger. He argued on the contrary that the US dollar was actually getting weaker due to inflation.
Third and Fourth Speeches
After a month in November 16, Dr. Paul delivered two speeches at the US Congress about inflation. In his first speech, he followed up his previous argument that the erroneous concept about inflation resulted to inability to provide genuine monetary solution. He further argued that high interest rates and prices are actually results of inflation (increase in money supply) rather than the other way around.
His second speech provided a more elaborated exposition of economic issues surrounding inflation. His central argument is that only the government has the capability to create inflation. His points exposed the error of misleading the public as to the causes of inflation, explained the true nature of inflation and how does the government do it, proved that inflation is not a modern economic phenomenon, dismantled the false solution, and provided the genuine solution to inflation.
If people would just understand the dynamics of inflation as explained by the Congressman we would be more economically informed and more empowered to speak against the misdeeds of the government. And there is no better way to start this unlearning and relearning process than by identifying the real cause of inflation. According to the Austrian Congressman, shifting the blames to labor unions, businessmen, Arabs, and the consumers are inaccurate and misleading. It does not help in solving the problem.
The Cause of Inflation
Only the government is responsible for causing inflation by increasing the supply of money through the central bank and by monetizing debt. High prices are not the cause of inflation, but a result. Continuous increase of prices of both production and consumption goods is not the mistake of free market, but actually an act of the government. If free market really exists, falling prices is the natural result.
I find the explanation of Dr. Paul on the misleading causes of inflation very informative. I am tempted to quote in full his explanation on the subject for there is no better way to fully understand the subject than to read the very words of the author himself. Despite of the limitation of my words, I will try to restate as briefly as possible the Congressman’s explanation.
Blaming greedy businessmen as the cause of inflation is misleading for human nature remains basically the same today as in the past. If greed is the real reason, why the prices are not rising up to nth level? It is basically because of consumer sovereignty that businessmen who will do that will be punished by the market by putting them out of business.
Blaming labor union as the cause of inflation will also not stand. We were told that demand for higher salary result to increase in prices causing inflation. The truth is: salary increase demanded by labor union is far below in comparison to the rate of increase in money supply. Loss of the purchasing power of workers’ salary is the final outcome of such growth in money supply.
Blaming the Arabs for inflation is also misleading. It is public knowledge that the price of oil is constantly increasing. The Arabs want their oil to be paid in higher quantity of US dollars. Ron Paul’s comparison of America’s need of oil with that of Switzerland, West Germany, and Japan is enlightening. These three countries import all their oil while US only import about half of it. The question is: why despite of such great discrepancy in the need for oil importation the standard of living of US is much lower than the three countries? Ron Paul’s answer lies in the difference of inflation rate between the two cases.
The True Nature of Inflation
For Ron Paul, inflation is both a tax and a theft. As a tax it is “exceedingly unfair and regressive” (p. 110). Only few benefit from inflation and great number of people suffer from it. The sufferers are the laborers and savers. Those who benefit are “speculators, bureaucrats, and the special interests favored by the government” (ibid.).
Inflation too is a theft. It is a form of robbing the workers and savers of their hard-earned money. “Morally, inflation is not different from the private counterfeiter…fraudulently exchanging something worthless for something valuable” (p. 111).
Other social and economic consequences of inflation include generating mistrust, rising prices, bankruptcies, and increasing unemployment. The illusory short-term economic benefits of inflation are too cheap a price to pay for all the economic destructions it causes. People will be dissatisfied, irritable, and uncertain about their future. Instead of planning for their future and participating in a free economy, people not knowing that their economic freedom is taken away from them by means of inflation will just go with the flow in living a daily survival mode of life.
Inflation is not a Modern Phenomenon
Inflation is not a modern economic phenomenon. Ron Paul claimed that inflation existed as early as the Roman Empire. Other monetary historians would even go earlier than that period. In American history, the libertarian Congressman mentioned that inflation played a critical role both in the Revolutionary War and the Civil War.
Solution to Inflation
The conventional solution of price and wage control has been tried and proven a failure “for more than 4,000 years” (p. 112) for it only deals with the symptom and not the primary cause of inflation. The only solution to inflation is to stop printing paper money and return to sound money.
Fifth and Last Speeches
The fifth speech of the Congressman was delivered on December 12, 1979. Its title is Debasement. In the mind of Ron Paul, inflation is currency debasement. In turn, debasement is a process of destroying the US dollar and threatens personal liberty. Those who are responsible for debasing the US dollar are not the businessmen, labor union members, Arabs, and the consumers, but the US Congress, the Executive, and the Federal Reserve.
The final speech on inflation was given on March 6, 1980. In this speech, Dr. Paul clearly defines inflation as “the expansion of the supply of money and credit” (p. 115) and specifically identifies the US Congress as “guilty of this crime” (ibid.). As a result of this crime “hundreds of billions of dollars” have been stolen “from orphans and widows, from the aged and the poor, from the thrifty and hard working” (ibid.). The Congressman was calling for a “thorough cleaning” of the US Congress as taking the chance to prevent an economic disaster.
Personally, I find the six speeches very educational on this confusing subject of inflation. Dr. Paul’s speeches help me clarify the confusion in my mind. How I wish that increasing number of people will take time to attentively listen to the message of the Congressman. The future of freedom depends on this enlightenment.
Source: Paul, Ron. (2008). Pillars of Prosperity: Free Markets, Honest Money, Private Property. Auburn, Alabama: Ludwig von Mises Institute.
After finishing our study of Part 1, The Economics of a Free Society, let us now proceed to Part 2, Mises and Austrian Economics – A Personal View. Allow me to divide this topic under two main points: a brief narrative of Ron Paul’s entrance into politics and an overview of key ideas in Austrian economics.
Brief Narrative of Dr. Paul’s Entrance into Politics
President Nixon’s interventionist economic policy in 1971 was the occasion that prompted Ron Paul to enter into politics. From the outset of his career, he already realized the difficulty of developing statesmanship among politicians due to pressure groups. He believes that the only way to develop statesmanship among politicians is by educating the public with Austrian ideas of personal liberty and free market. He describes his political career as primarily dedicated to this task of informing the public about the real issues in our time.
Dr. Paul’s introduction to Austrian economics was a result of his reading of F. A. Hayek’s “Road to Serfdom.” After reading this book, he decided to dig into the great literatures of the Austrian school. His journey into his new discovery equips him to see the discrepancy between the teaching of Austrian economics and mainstream society. All the more he saw the need to implement Austrian ideas through political action.
In addition to the message of Austrian economics, the men surrounding the Austrian school also made a lasting influence on Dr. Paul. His acquaintance with Leonard Read inspired him to be firm in his economic reforms. His friendship with Hans Sennholz and Murray Rothbard gave him firsthand knowledge about basic operation of the free market. Acquaintances with other Austrian economists encouraged him in his political career. Among them, it was the character of Ludwig von Mises, the leading Austrian economist himself who left a lasting impression on the Congressman. Dr. Paul saw Mises as a man of strong will, but tempered by a quiet spirit. The man is patient and determined despite of the changing and worsening political and economic climate of the time. All these influences prepared Dr. Paul in his entrance to politics and gave him the ability “to tolerate the daily circus” (p. 51) in US Congress.
Key Ideas in Austrian Economics
Among numerous ideas shared by Dr. Paul in his book, I find understanding five of them very beneficial to equip someone to distinguish between illusory and real economics. These ideas include the subjective theory of value, understanding money, business cycle, international politics, and natural rights.
Subjective Theory of Value
Understanding the subjective theory of value brings several advantages with it. Unfortunately, as to the date of the writing of the book, Ron Paul claimed that most members of the US Congress never heard of this theory and none really cared to know the relevance of this theory to contemporary affairs. But for the Tea Party Congressman, understanding the theory is basic for true reform. One will be equipped to see the real color of interventionists’ excuses. Citizens will grasp the free nature in determining the prices of goods, which is essential for the healthy operation of the market.
Sound Theory of Money
In addition to the subjective theory of value, Dr. Paul believes that “understanding money is the key to restoring a sound economy” (p. 55). In fact, following Mises, for Dr. Paul the money issue is beyond economics and touches even the political issues of the time. This makes basic understanding of money a necessity for a correct diagnosis of existing problems and in finding the right solution. Sadly, politicians due to ignorance of genuine free market ideas struggle to provide adequate explanation to the pressing issues of the day.
I think that the claim of Congressman Paul that Ludwig von Mises’ Theory of Money and Credit published in 1913 had answered the perplexing questions of the 20th century is also applicable in our time. Unfortunately, Mises’ answer had been ignored resulting to indescribable human suffering; and if our generation fails to learn from the past, we will experience similar or even worst calamities in the future.
There is no need for us to repeat similar mistake. Our primary advantage in comparison to the previous generation is the accessibility of information through the web. Personally, I find that understanding Mises’ theory of money is beneficial in three ways:
- It will train us to differentiate between fiat and commodity money
- It will also help us to comprehend the debate between the quantity and quality concepts of money, and
- It will enable us to see the economic advantages of the free market
1. Fiat and commodity money
In present day economics, the money we are using is not commodity money, but fiat money. The supplier of this money is none other than the state through the central bank. As history taught us well fiat money always self-destruct. The only remedy to avoid monetary destruction is to return to commodity money bringing back its control into the hands of the free market.
2. Quantity and quality concepts of money
Being aware of the issues surrounding the debate between the quantity and the quality concepts of money is another advantage that one could gain in studying Mises’ theory of money. Mainstream economists and politicians advocate the quantity theory of money. This theory teaches that economic growth is only possible through the increase in money supply. Studying Mises, Dr. Paul does not agree with this. Upholding the quantity concept of money is only appropriate for inflationist and those who do not understand Austrian concepts of value, price, and quality of money. Austrians argue that the government cannot enrich its citizens through inflating the money supply.
3. Economic advantages of free market
Finally, sound theory of money will enable us to appreciate the real nature of free market. Studying it, the charge that the free market harms the working class will be found baseless. Instead, one will see that genuine free market terminates the struggle between the bourgeois and the proletariat, increases the number of the middle class, and improves people’s standard of living. All of these economic advantages are consequential realities in a society established on the basic foundation of personal liberty.
Another central idea in the Austrian school of economics is the concept that the business cycle is brought about by inflating the money supply through the central bank. Dr. Paul asserts that almost all Washington politicians are unaware about this Austrian concept. As a result of such ignorance, political and economic inconsistencies afflict the statist policies aiming to solve the crisis. This holds true both for Republicans and Democrats.
No politician would dare claim that intentional decision has been made resulting to unemployment, rising prices, and lower standard of living. And yet these are the things happening in the economy. Another inconsistency is that all politicians claim to know the solution to business cycle and yet at the same time, they all agree that the cycle is an inherent flaw in capitalism. The outcome of this blindness is a solution that intensifies the crisis all the more.
The solution offered by Washington politicians is nothing but a strategy of increase spending out of the crisis. This is a foolish remedy for it fails to deal with the root cause and instead signals a new entrance into a far deeper and greater business cycle. The final result of this solution is the destruction of the system itself.
Congressman Ron Paul acquired his education into this matter through the works of Murray Rothbard and Hans Sennholz on 1930 Great Depression. From Austrian point of view, the way to stop the business cycle is to abolish central banking and fiat money and return to an honest monetary system. Since most people are really concerned about the economic situation of the world, I think Ron Paul’s challenge is applicable not only to Americans, but to all citizens of other countries as well.
“All people concerned with the suffering and degradation of unemployment should study the Austrian explanation of how distorted interest rates, malinvestment, skewed economic calculation, and preferential treatment for favored business and government constituencies, cause the crime of the business cycle” (p. 59).
The continued existence of central banking and fiat money does not only cause the business cycle, but also generates international crises and war. For the Tea Party Congressman, a faulty monetary system is inseparable from issues related to foreign relations. He explains the nature of this connection by analyzing the impacts of economic interventionism.
Dr. Paul believes that economic interventionism breeds “excessive nationalism, protectionism, economic isolationism, militarism, and war” (p. 60). In order to perpetuate interventionism, an unlimited supply of fiat money is necessary. Without it, interventionism collapses.
Seen from this point of view, interventionism is a serious threat to personal liberty and the survival of present civilization. According to Ron Paul, Mises has already foreseen the future of such type of interventionism, which is heading towards a fascist government similar to Nazi Germany. Ron Paul was alarmed witnessing the signs of Mises’ prediction in contemporary America. His only hope was to reverse the tide before its final fulfillment. And the way to do this is to return to sound money and free market economy.
Ron Paul quotes Mises to describe the contrast between interventionism and the free market:
“While laissez faire eliminates the causes of international conflict, government interference with business and socialism creates conflicts for which no peaceful solution can be found” (p. 61).
Dr. Paul describes further the seriousness of present international tensions:
“The magnitude of these tensions is even greater than in the 1930s. International debt is deeper; the degree of worldwide inflation is more ominous….Gold has been ‘discredited’ by all governments. The engines of inflation throughout the world are running at full throttle, struggling to keep the debt pyramid from collapsing. True capital formation diminishes yearly. Military build-ups continue at unprecedented rates….All this insanity, of course, is financed through massive taxation and inflation borne by our taxpayers. Without fiat money, these wild schemes would be impossible” (p. 62).
In reading this topic, I intentionally skip the Congressman’s explanation on “utilitarianism” and “conscription” for I find it philosophically difficult at this time. It is sufficient for me to know about the essential idea of liberalism [“that all men are created equal and endowed by their creator with certain unalienable rights” (p. 63)] and the advantages in upholding natural rights. I understand that for Dr. Paul, the concept of natural rights provides a necessary moral argument not only to win the debate over the socialist, but also to realize a peaceful society.
Conclusion: Three Relevant Quotes
I want to end this article with three relevant quotes taken from Dr. Paul’s book. I already included these quotations in my earlier articles. I found them first from LewRockwell.com and Ludwig von Mises.com. Despite of their familiarity, I still consider it appropriate to end this summary and reflection with great ideas from Ludwig von Mises himself.
“Everyone carries a part of society on his shoulders; no one is relieved of his share of responsibility by others. And no one can find a safe way out for himself if society is sweeping towards destruction. Therefore everyone, in his own interests, must thrust himself vigorously into the intellectual battle. None can stand aside with unconcern; the interests of everyone hang on the result. Whether he chooses or not, every man is drawn into the great historical struggle, the decisive battle into which our epoch has plunged us” (p. 65).“There is no means by which anyone can evade his personal responsibility. Whoever neglects to examine to the best of his abilities all the problems involved voluntarily surrenders his birthright to a self-appointed elite of supermen. In such vital matters blind reliance upon “experts” and uncritical acceptance of popular catchwords and prejudices is tantamount to the abandonment of self-determination and to yielding to other people’s domination. As conditions are today, nothing can be more important to every intelligent man than economics. His own fate and that of his progeny is at stake” (pp. 65-66).“The flowering of human society depends on two factors: the intellectual power of outstanding men to conceive sound social and economic theories, and the ability of these or other men to make these ideologies palatable to the majority” (p.67).
Source: Paul, Ron. (2008). Pillars of Prosperity: Free Markets, Honest Money, Private Property. Auburn, Alabama: Ludwig von Mises Institute.