Dec 22, 2011
What About Money Causes Economic Crisis?
The above video is the third and final installment of a series of lectures by the office of Congressman Ron Paul about money. In this video, Peter Schiff analyses what about money causes economic crisis. He gives both analysis, and personal stories that highlight this phenomenon in a way that, perhaps, many have not considered. One of my favorite parts is when he gives some perspective on unemployment:
@40:48- Question: "Can you talk for a minute about your views on unemployment insurance?..."
"Obviously there is an economic truism that you are going to get more of what you subsidize. I mean, if you are going to pay people not to work, people are going to take you up on it. I did it myself! I remember the one time in my life I collected unemployment benefits, I did not look for a job until I exhausted my benefits...There are a lot of people who do the same thing today. It's not wrong, it's human nature...People forget that leisure has value. People would rather not work. People save up so they can retire. Well, you can retire early now on unemployment."
"A lot of people say 'That's ridiculous- it's only $300/week...' True! Yeah, if somebody offered an unemployed person a $100,000/year job, they'd probably take it. But, what if the only job they're offered is $400/week? Or $500/week? Most people won't take it! They'd rather have unemployment, because it's like a huge tax on getting a job. The highest marginal tax bracket is faced by someone who is getting unemployment...Not only does he have to pay taxes on what he earns, but he loses all of his unemployment benefits. So the tax rate is enormous."
"And, of course, people forget when you get a job, you don't get to keep all your income- there's a lot of expenses that the IRS won't let you deduct. What if the job you get offered is 45 minutes away from your house? What's it going to cost you in gas money to get there and back? Maybe you have to eat in a restaurant, maybe you have to wear a suit, maybe you have to have a dry cleaner. Maybe you have a kid. What if you have to put your kid in daycare- how much is that going to cost? So, it's so much easier just not to work.
Previous lectures in the series can be found embedded in these posts:
Lecture #1- Fiat Currency and the Milkman
Lecture #2- What is Constitutional Money?
After watching these talks, I have come away with a much greater understanding of where we are, where we have been, and what we face. It is well worth the time spent to educate ourselves of these issues- as the money issue has a profound effect on our daily lives, and the nature of society. I think after you watch this series, the impact of the monetary issue on our liberty will become quite clear.