Thursday, August 08, 2013

The Overarching Policy – The Moral Authority of the Divine Economy

To quote Ludwig von Mises: ‘The first condition for the establishment of perpetual peace is the general adoption of the principles of laissez-faire capitalism.’[16]

I would like to modify his recommendation slightly.

· First, we can rest assured that the prosperity of an ever-advancing civilization emanates from the divine economy.

· Second, we can trust in the equilibrating power of the divine economy.

· Third, we can trust in the divine justice that comes from protecting property rights and that comes from recognizing that property rights are human rights.

 Those who fail to admit their own limitations and then expect others to believe their assertions that they can comprehend all that is going on in the economy — thereby 'giving themselves the right' to interfere — these are the ones who are now without authority. It matters not what position of influence one holds or what degree one has or what record of publication one has. There is no human act of intervention in the economy that is not feeble-minded when compared with the infinitely dynamic and ever-pervading market processes which happen to be intricately connected to each and every subjectively-perceiving and acting human being. All interference with the economy is necessarily ego-driven; and it lacks moral authority.

Policies that convert latent entrepreneurship into active entrepreneurship and policies that encourage alertness and discernment expand the overall potential of entrepreneurship in the minds of all. When market information is free from the distortion caused by intervention it is then that the divine economy is in a charged state releasing an increased power of human creativity.

Policies that are conducive to building a link between capital and entrepreneurship complete the transformation implied and described by the recurring designation ‘Ever-Advancing Civilization.’

Policies that foster the nature and role of knowledge in the individual and in the market carry forward an ever-advancing civilization. Implied in the ‘nature of knowledge’ is the refinement and progress of human learning. And implied in the ‘role of knowledge’ is economic communication by the means of market prices and voluntary worldwide trade.

Policies that promote justice and unity universally stem from the preservation of both the nature and the role of knowledge; that is, preservation and protection from those who have ego-driven motives. It is the ego-driven who try to interfere with the nature of knowledge since they are the ones who benefit from the existence of prejudices, superstitions, and ignorance. Likewise it is the ego-driven who try to manipulate the economy through intervention, all for the purpose of benefiting themselves directly or indirectly.

Each of the following eleven simple policies fall within the overarching policy of the moral authority of the divine economy and will effectively promote an ever-advancing civilization in various ways. All of them also compliment each other. Of keen interest is the fact that all of these policies represent positive changes that have been brought to the forefront of our attention by the divine economy theory.

The Eleven Simple Policies

1. Well-defined and continually refined property rights

2. The right of secession

3. Market forces will moderate business sizes

4. Enforcement of property rights

5. Education about entrepreneurship

6. War and inflation violate property rights

7. Gold passes the market test

8. Counteract the misinformation about capital

9. New capital is a good start

10. International free trade

11. Minimal taxation

There is no macroeconomic theory that is more specific in its policy. Nor is there a macroeconomic theory that is as well-grounded in both theory and in the classical liberalism tradition as is the divine economy theory.

This then represents a challenge to all economic theorists. Is there a better theory, more cohesive, more succinct, more clear, more doable? The answer is "No".

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