Thursday, September 20, 2018

UN Shows Its Totalitarian Colors

I recently warned that modern-day socialist ideologues not just advocate economic central planning, but also expand their totalitarian ambitions to green central planning. However, the statists are already moving on to the next stage, where the separation of the two types of central planning is history.

The leading entity here is the United Nations.
In a publication called Global Sustainable Development Report 2019, the UN includes a section on Governance of Economic Transition. Written by a group of Finnish academics, this document is a manifesto for central planning of the entire global economy.

To see how they reach that conclusion, let us start from the point where they throw out existing economic theory as inadequate because it was "developed during an era of energetic [sic] and material abundance". Dominant economic theory, they suggest,
as well as policy-related economic modeling rely on the presupposition of continued energetic and material growth. The theories and models anticipate only incremental changes in the existing economic order. Hence, they are inadequate for explaining the current turmoil.
The "turmoil", of course, is alleged global warming or "climate change" as it is also being referred to. Since there is no man-made global warming, and since its proponents have been proven wrong time and time again (for example, the polar ice caps were supposed to melt away by 2013; even NASA has admitted that this is not happening) the entire premise for this "Governance of Economic Transition" report from the UN rests on a false premise.

A well-crafted story. A fairy tale. A myth, for short.

With that in mind, it actually become easier to see what the UN "economic transition" report is all about. The gateway to their real purpose is revealed on page 2, where they suggest:
[Societies] are witnessing rising inequality, rising unemployment, slow economic growth, rising debt levels and governments without workable tools for managing their economies. Central banks in the US and the Eurozone have resorted to unconventional measures such as negative interest rates and buying up significant amounts of public debt. ... many commentators are worried about what can be done after these extraordinary measures are exhausted and the next economic crisis hits
In this short paragraph, the UN puts on full display its case for economic central planning. First, they are using a non-existing environmental crisis to break down intelligent resistance to central planning. Secondly, they assume right off the bat that government should run the economy. Listen to this part again:
governments without workable tools for managing their economies. 
The only problem is that it is not government's business to manage the economy. That is the business of individual citizens and - no pun intended - businesses. If anyone needs more evidence that the free-market economy is superior, my good friend Dan Mitchell recently explained its superiority in a great piece for the Center for Freedom and Prosperity. My book Industrial Poverty is also relevant, as it explains in detail how the welfare state - a light form of economic central planning - is the cause behind the economic ailments that the UN report refers to, such as rising unemployment, slow economic growth and rising debt levels.

The third display of the UN's central-planning agenda is in these words:
many commentators are worried about what can be done after these extraordinary measures are exhausted and the next economic crisis hits
Ever since the mid-20th century (longer in some cases) governments in the Western world have been escalating their own presence in their economies. Welfare-state spending has sprawled into health care, income security, tax-paid education, retirement and so on, all in order to advance an egalitarian agenda of economic redistribution. In other words, for more than half a century, governments have already been actively infringing on the free-market economy in the name of "equality" and economic redistribution. The result is the Western world we see today, with precisely the ailments I just mentioned: slow growth, lack of economic opportunity for young people, unsustainable government debt levels...

The U.S. economy under Trump is showing that there is still life in the free-market system, which is one reason why the foes of freedom are resorting to new measures to advance their aggressive, central-planning agenda. The UN report, again, is a case in point.

In terms of actual policy changes, this group of mis-educated Finnish economists rest on two premises taken straight out of the socialist dreamland:

1. A universal job guarantee where everyone who wants a job can get it by simply going to a government office and ask for it.
2. Floor the spending accelerator in the government budget, because government can never run out of money.

Both these ideas originate in a deeply flawed line of thinking called "Modern Monetary Theory". It is very disturbing that this perversion of economic thought has now reached into the heartland of the United Nations. It is even more disturbing that it is being used as a bulldozer to advance one of the most destructive political ideas of all time: economic central planning.

The two policy instruments that MMT'ers propose (and I will get to who they are in a moment), a job guarantee and endless government financing, are essential to the 21st century version of central planning. They are also dangerously flawed, and really nothing more than economic fairy tales.

The "job guarantee" is really a recognition that economic central planning destroys the only job-creating machine the world has ever seen: free-market capitalism. Therefore, MMT proponents think that they can avoid the Venezuelan implosion by simply giving everyone a job in government. To get around the constraints on government funding, they create a nice-looking theory that - as we will see in a coming article - is not only useless, but actually dangerous. as an instrument for policy making. 

It is disturbing, to say the least, though not surprising, that the United Nations is proposing global economic central planning. It is an ideological red flag - in more ways than one - that we need to take seriously, in part because of who its support groups are. The UN initiative is driven by "intellectual" academics, in this case in Finland and the United States; the MMT was concocted by a small group of economists at the University of Missouri, Kansas City (UMKC). 

To be clear, I have not yet found anyone at the UMKC, but they have also not objected to how the UN is using their theory to advance anti-democratic policies. The good people over at the UMKC should take note; their MMT theory conveniently lends itself to authoritarian government policies. 

Academia has long been a breathing ground for totalitarian thought. Friedrich von Hayek noted in his The Road to Serfdom that there was widespread support for National Socialism among British academics. Roland Huntford, British journalist and author of The New Totalitarians, observed a similar infatuation with tyrannical ideas among Swedish academics. In my book The Rise of Big Government I explained how the same ideas that inspired Nazism were used as a theoretical foundation for the Swedish welfare state.

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