Unregulated

An amazing article via the Mises Institute’s blog about how the Zimbabwean government has debased the nation’s currency to the point where it has been abandoned in favour of foreign currencies. Such has weakened Mugabe’s grip on the economy and allowed revival to begin:

In February 2009 Zimbabwe was the only country in the world without debt. Nobody owed anyone anything. Following the abandonment of the Zimbabwe Dollar as the local currency all local debt was wiped out and the country started with a clean slate.

It is now a country without a functioning Central Bank and without a local currency that can be produced at will at the behest of politicians. Since February 2009 there has been no lender of last resort in Zimbabwe, causing banks to be ultra cautious in their lending policies. The US Dollar is the de facto currency in use although the Euro, GB Pound and South African Rand are accepted in local transactions.

Price controls and foreign exchange regulations have been abandoned. Zimbabwe literally joined the real world at the stroke of a pen. Money now flows in and out of the country without restriction. Super market shelves, bare in January, are now bursting with products.

During the 30 minutes of active haggling, nine kids sat around the dining room table and participated in a hectic, yet orderly — if complex — interchange, bearing a good deal of resemblance to a Wall Street trading floor. Some traders shot up and shouted prices, deals, proposals, results, changes in preferences, new resource discoveries. Other traders remained quiet and moved with great subtlety and surprise. The more strategic the plan, the more impressed the other kids were by it.

An article about the U.S. government’s now declassified but detailed blueprint to invade Canada and the West Indies in the 1930s:

“Blue [American] intentions are to hold in perpetuity all CRIMSON [Canadian] and RED [British] territory gained,” Army planners wrote in an appendix to the war plan. “The policy will be to prepare the provinces and territories of CRIMSON and RED to become states and territories of the BLUE union upon the declaration of peace”.

I think at a fundamental level many people recognize Rand’s essential truth—government doesn’t know best. Those in power in Washington—or indeed in Columbia, S.C.—often lead themselves to believe that our prosperity depends on their wisdom. It doesn’t. The prosperity and opportunity we enjoy comes ultimately from the creative energies of the country’s businessmen, entrepreneurs, investors, marketers, and inventors. The longer it takes this country to reawaken to this reality, the worse we—and in turn, our children’s standard of living—will be.