The myths underlying statist hegemony are born in schools and universities
The distrust of the market economy that pervades the younger generations is worrying and raises a big question about the direction that will be taken by the future ruling class. The capitalist economy is seen as a source of unprecedented environmental and social abuse. And certainly pandemic management and post-pandemic policy are not stopping this trend, rather they are fueling it. This is nothing new: at the onset of the great crises, the opponents of liberalism from every political camp unleash their most powerful weapons to discredit it. The most worrying fact is that a majority of the younger age groups, across the West, are convinced that the state can restore an economy in times of crisis, and perhaps even plan it. Yet the state is being financed by the very same economy it is supposed to save.
The foundations of this statist cultural hegemony must be sought starting from the school desks. It is in the schools that the myth of " neoliberalism " is built, when in reality, at least in Italy, there is no trace of it. The exploitation of history in school texts clearly demonstrates the level of ideological warfare against the market. Manuals that celebrate those who have repudiated the logic of the free economy, saving the masses from the greed of liberal savages .
The crisis of 1929 has been seen from time immemorial as the great failure of the irresponsible policies of that decade. But reading several works, including the analysis of Nobel laureate Milton Friedman and Anna Schwartz " A Monetary History of the United States, 1867-1960 " (1963), or Lawrence Reed's recent essay " Great Myths of the Great Depression ” , We find ourselves in front of a very different scenario. Mistakes and monetary contraction by the Federal Reserve, and not a market failure, brought the economy to a crash. Proof of this are the statements of Ben Bernanke (governor of the Fed from 2006 to 2014) in 2002:
“I would like to say to Milton and Anna: Regarding the Great Depression, you're right. We did it. We're very sorry. "
The interventionist policies after 1929 aggravated the overall situation, causing a depression. Still, you just need to flip through any high school history textbook to get the praise of Franklin D. Roosevelt and his massive federal program that would get the American economy back on track in the 1930s. Of course, it doesn't matter if the data blatantly disproves this story: in 1938, unemployment was still around 20 percent. The New Deal has therefore worsened the conditions of the country and initiated a change of course whose consequences we are still paying for today. In this regard, a passage from the private diary of the then Treasury Secretary Henry Morgenthau jr is illuminating:
"We have tried spending money. We are spending more than we have ever spent before and it does not work … "
However, it should be noted that the long statist course had already been inaugurated by Republican Hoover, FDR's predecessor. Ironically, Hoover is remembered as the president who " let the market do it" ; a bit curious for the one who signed the Smoot-Hawley Tariff Act of 1930.
One thing is certain: leafing through the pages of school texts, we will not find any trace of the presidential couple Harding-Coolidge, who led the United States to prosperity for a decade and who managed to resolve, precisely with liberal measures, the forgotten and very brief crisis of 1920. -21.
Victim of the same cultural hegemony is also the crash of 2008. All to blame the financial " turbo capitalism ", without realizing that about 76 per cent of subprime mortgages were in the notebooks of Washington regulatory agencies. This is reported by Peter Wallison in his “ Hidden in Plain Sight: What Really Caused the World's Worst Financial Crisis and Why It Could Happen Again ” (2015). Nobody even remembers that Fannie Mae and Freddie Mac were real estate giants perpetually funded by public money, through programs like the HUD ( Housing and Urban Development ) and the CRA ( Community Reinvestment Act ).
Thomas Sowell's lucid analysis in “ The Housing Boom and Bust ” (2010) served to detox the economic literature from a misleading narrative. Far from having been caused by a non-existent liberalism, the 2008 crisis is the result of the widespread crony Capitalism , the incestuous collusion between government bodies and major corporations:
“Government was not passively inefficient. It was actively zealous in promoting risky mortgage lending practices "
If at school and university level the idea that " more State " is inculcated, it will then be difficult for former students to understand the collateral damage of public intervention of yesterday and today, and to embrace the benefits, visible and invisible, of a economy as free as possible.
A reversal of the trend is therefore more necessary than ever, if we do not want the younger generations to demand the continuation of historically failed policies. It is up to us to feed this liberal turnaround, which is struggling to arrive, in small steps. And perhaps we will have to wait for better times; after all this is what the Nobel Prize winner Friedrich Von Hayek did who in 1978, after a life spent defending his ideas from Keynesian primacy, stated:
“When I was young, only the old people believed in the free market; when I was a middle-aged man, I was practically the only one who believed it; and now I have the pleasure of having lived long enough to see that young people are beginning to believe in the free market. It is an epochal change ”.
The post The myths behind statist hegemony are born in schools and universities appeared first on Atlantico Quotidiano .
This is a machine translation from Italian language of a post published on Atlantico Quotidiano at the URL http://www.atlanticoquotidiano.it/quotidiano/i-miti-alla-base-dellegemonia-statalista-nascono-nelle-scuole-e-nelle-universita/ on Tue, 12 Oct 2021 03:52:00 +0000.