Saving Our Founders’ Intentions

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  • There are people who maintain that a society’s economy should be truly laissez faire: absolutely separate and distinct from its political process, with even its own form of ‘justice’, i.e., the outcomes of free markets. The simple fact is, however, that no such thing is possible. The political process includes government — the functional core, actually, of the political process. The fuel of any nation’s economy is its money: its legal tender. No nation has ever existed without one. The legal tender is whatever a nation’s national government says it is. Moreover, that government determines how that legal tender can be created. Heretofore, in every nation “legal tender” has meant that which its government decided would be accepted for the payment of taxes and which banks could demand for repayment of loans. So even if taxes did not exist, legal tender would still be necessary for a banking system to exist. As a daydream a person can imagine an economy in which every loan from a bank included a negotiation for the means of repayment, but as a practical matter there can be no such a thing as an economy without a banking system and no such thing as a banking system with a legal tender — which is determined by the national government. Since there can be no such thing, as a practical matter, as a society without a legal tender, realistically, a truly laissez faire economy cannot exist.




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Stephen Yearwood

Stephen Yearwood

unaffiliated, non-ideological, unpaid, academically trained in economics and philosophy

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