by Robert Gore
An institution that claims the right to initiate force and has the means to do so is an institution to be feared. History confirms the fear: government has been responsible for more deaths and destruction than any other human instrumentality. That the hallmark of government—legally sanctioned violence—produces carnage should come as no surprise. Remarkably, over the last century fear of government has been transmuted to fear of its absence, even as governments have racked up new records for carnage. The shift has been marked by a widespread psychological and moral deterioration that evades the reality of state destructiveness and insists on more of it.
While fear can be quite rational and produce a rational response—rushing to higher ground because of a looming tsunami—it is emotionally corrosive, stifles reasoned analysis or deliberation, and magnifies itself in groups. As such, it’s a lever for mass manipulation. Manipulative maestro Franklin Delano Roosevelt pivoted the US from its traditional skepticism of government to wholehearted embrace. The stock market crash of 1929 and ensuing recession were the inevitable bust of the credit-fueled boom, sponsored by the Federal Reserve, that preceded it (see America’s Great Depression, Rothbard, 1963, and The Great Deformation, Stockman, 2013). The New Dealers claimed that capitalism had failed, but it was central bank-promoted credit, untethered from the real economy, that had failed.
Roosevelt converted that failure into a fear-based demand for more government. Somehow, in a way that was never logically explained (because it was impossible to do so), coercive redistribution would ensure economic security. It self-evidently diminished the economic security of the coerced, but it didn’t do much for the beneficiaries either; the economy in 1938 was in worse shape than when Roosevelt took office in 1933. The many New Deal programs, regulatory agencies, taxes, laws, and regulations meant to improve upon “failed” capitalism distorted or destroyed the regulation inherent in competition, took money from productive individuals and businesses for nonproductive purposes, created a class of agents dependent on rent seeking from the government, and burdened the economy with uneconomic mandates.