In continuance of the last post, the theme that the free market as an integral part of nature continues. The free market, like an ecosystem grows best when it is not tampered with. Like growth and rot, economic growth and recession, there are many more similarities. Such an example can be drawn directly from history.
After the Civil War, during the reconstruction period of the south, the soil became very poor because of the over planting of the South's cash crop: cotton. Because the soil was overburdened with the nitrogen depleting cotton, the cash crop itself began to suffer for the lack of nitrogen. Seeing the problem a man by the name of George Washington Caver, a botanist, reimplemented the old ideas of crop rotation in a new way. He advised that the cotton should not be resown year after year, but rather that some years legumes, and especially peanuts, should be grown instead so that the nitrogen would be returned to the soil.
This lesson from history can mirror what is seen when the government manipulates the free market. The government sees a lucrative sector in the economy and decides that it needs to stimulate it's growth. When they do this they deplete the rest of the economy in countless ways.
If a government decides to inject a given sector with extra capital, they remove that capital from the whole economy either through taxation or inflation. Siphoning water from the soil to place on one plant harms the rest of the garden, causing draught.
When a government places an embargo upon trade, they withhold needed goods form the economy. excessive clear cutting, causes a dust bowl.
When a government communizes the means of production then a displacement of capital occurs. When a gardener ensures that all his diverse plants get the same amount of soil, sun, and shade, then only those plants adapted to those conditions survive.
Ultimately, the free market and nature are both phenomena that goes on, and in despite of intervention and control. When manipulated they tend to backfire upon he who dares to organize them into an order they were never supposed to be in.
After the Civil War, during the reconstruction period of the south, the soil became very poor because of the over planting of the South's cash crop: cotton. Because the soil was overburdened with the nitrogen depleting cotton, the cash crop itself began to suffer for the lack of nitrogen. Seeing the problem a man by the name of George Washington Caver, a botanist, reimplemented the old ideas of crop rotation in a new way. He advised that the cotton should not be resown year after year, but rather that some years legumes, and especially peanuts, should be grown instead so that the nitrogen would be returned to the soil.
This lesson from history can mirror what is seen when the government manipulates the free market. The government sees a lucrative sector in the economy and decides that it needs to stimulate it's growth. When they do this they deplete the rest of the economy in countless ways.
If a government decides to inject a given sector with extra capital, they remove that capital from the whole economy either through taxation or inflation. Siphoning water from the soil to place on one plant harms the rest of the garden, causing draught.
When a government places an embargo upon trade, they withhold needed goods form the economy. excessive clear cutting, causes a dust bowl.
When a government communizes the means of production then a displacement of capital occurs. When a gardener ensures that all his diverse plants get the same amount of soil, sun, and shade, then only those plants adapted to those conditions survive.
Ultimately, the free market and nature are both phenomena that goes on, and in despite of intervention and control. When manipulated they tend to backfire upon he who dares to organize them into an order they were never supposed to be in.
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