07 December, 2010

Economic Spectrum - illustration

Interesting illustration of the economic spectrum:

To the left is Austrian school of economics, in which the role of government in the economy is limited (Friedrich Hayek & Ron Paul).
Then the Monetarist school (J.P. Morgan, Ben Bernanke) and the Keynesian school (John Maynard Keynes, and Barack Obama), both characterized by big government spending. 
And finally at the end is the grand daddy of all big government, the Communist school of economics (Karl Marx, Kim Jong Il).

13 March, 2010

Public transportation for BiH students must be free. Really?

It was just recently that public university students made a peaceful march in streets of Sarajevo, protesting against governments' failure to deliver free transportation to students as promised.
Reaction of general public to this action of students has been positive and supportive of their cause, which only confirms the fact that the belief in socialism and big government is alive and well in Bosnia and Herzegovina.

The following is the, rarely ever considered, libertarian point of view on this issue: 
First, it has to be pointed out that government promise to provide students with free transportation really seems like a noble cause worth supporting.  Free things for the students, investing into the future of our country, who wouldn't be for that?  Furthermore, the very act of students protesting is a very positive thing, as it means exercising the basic human rights of free speech and freedom of assembly.  Finally, holding the government accountable and demanding fulfillment of their promises is another positive aspect of this student protest, and such action should be encouraged.

However, citizens (including students) too-often value government policies by their good intentions, and rarely ever think about the negative consequences of such policies, including paying attention to the socialist methods, for the benefit of one group and at the expense of another, in which they are almost always achieved.  Where will the necessary annual 3 million KM for this noble cause come from?  Does government create wealth, or it forcefully takes fruits of people's labor in order to fulfill their promises and save their comfortable seats?  Could this too be just another deception by politicians designed to buy votes for the coming elections?

And the final argument, people always seem to fail to remember history and the poor results of all government involvement in doing good for them.  Why would anyone give job to someone who has the long history of delivering failures after failures?

So is it finally time for the people (and students) of Bosnia and Herzegovina to seriously start questioning the reality and correctness of governments' good intentions, as well as its ability to deliver the promised services before saying "yes please!"?  So should students re-think about this promise and maybe say no to it?  I think so!

And so to the government: if it really wants to help students, then it should abolish the state monopoly over the public education and allow the free market competition to provide the best and the cheapest education that taxpayers' money can buy.  This would mean freedom of parents and students to choose schools and teachers of their liking, rewarding the best and running out of work those undeserving.

25 February, 2010

Should there be a BiH National TV Channel in Croatian Language?

For some time now a debate has been going on how to allow for a greater representation of Croatian language in Bosnia and Herzegovina's Federal television. Currently, the Federal television is being dominated by Bosniak staff and TV programs are spoken in Bosnian language, geared for Bosniak viewers. Croat population obviously feel excluded and want some changes. One serious suggestion is to establish a separate federal TV channel in Croatian language.

Libertarian answer to this question is very simple: Bosnia and Herzegovina does not need national television. National television is the inheritance of communist practice from the times of socialist Yugoslavia, with national television as the only legal media (read: propaganda tool for indoctrination of the masses) which was allowed to operate. Therefore, there is no need to create any new channels but instead to dismantle even those existing ones and keep the money in the hands of the people.

Private media has always been more than happy to publish government news. Why spend giant sums of money on something which is completely unnecessary. Why force citizens to pay 6.95KM + VAT per month for government run television, regardless of whether they watch it or not? Why smash TV monitors of private citizens who watch exclusively satellite television, and why go back to the times of good old “inform bureau” and confiscate peoples' property for not paying services they are not using?

Private television is free, it provides better quality content by far, and it offers many more choices with something interesting to watch for everyone.

It is about time to end the theft of peoples' property, to abolish the existing national federal television and end indoctrination of the masses at their expense, and to allow the private sector and free market to deliver the best media available.  It is time for the citizens of Bosnia and Herzegovina to finally be able to do the media quality control with their TV remote controls, instead of being forced to subsidize the government propaganda apparatus - the extended arms of the ruling political parties.

21 January, 2010

Ante Marković - Milton Friedman of Western Balkans

What led to the fall of Soviet Union and Yugoslavia? To a great degree it was inflation, the same thing that is slowly plaguing the United States and most every other country in the world.  A short definition of inflation - printing money out of thin air. In other words, it is a form of taxation without legislation, where governments steal the people's money without the need to tax them directly.

That is a classic unlearned lesson in economics which is repeating itself since the Roman Empire.  In this following video clip, a famous policy maker from former Yugoslavia Ante Marković says: "If the entire creation of resources, not including these latest ones, is between 3 to 4 times larger than the entire GDP, then it is clear that the problems were being created and attempted to be resolved artificially, in an artificial way, without the real, realistic foundation.  It led to a formation of one giant bubble, in which there is nothing, which has now exploded."

In other words it means that large sums of money were being printed, created out of thin air without any backing with real value (definition of inflation), for the purpose of financing government projects and agendas which normal budget cannot afford.  Citizens are now paying for all that through higher prices, which is the direct result of inflation.  Prices have risen simply because printing money out of thin air has made the paper money less valuable.

History shows that diluting the value of money has brought destruction to many empires and countries.  The best example of this comes from times of Roman Empire.  In the time when it became overstretched and couldn't finance all of its campaigns, Romans resorted to clipping of gold coins and used clippings for creating more coins, diluting the value of the currency directly.
And former Yugoslavia is one of the best examples of excessive money printing and hyperinflation in recent history, as a country whose inflation at one point reached astronomical proportions, perhaps second only to Zimbabwe.

In a system where government is confined to its proper role of protecting life, liberty, and property of all individuals - something which the US government used to be from its inception up until the turn of the 20th century, the government would be tied to its limited budget, and politicians could not spend money by inventing new laws, starting wars, or looking for ever more excuses to help themselves under the auspices of taking care of people's needs.  Having honest money - backed up by real value (gold and silver), and no power to create inflation (print the money out of thin air), and not being able to dictate to the free market, would allow market forces to solve people's problems in a best most efficient and timely manner.  Companies in bad shape would not be helped by their governments, leaving them to fail, thus creating incentive for healthy businesses to invest carefully and conduct business in the most efficient way.