The economy tends to be distorted


Nothing in the world is completely perfect. Everything is two-sided; we can find something good and something bad in everything. And so, quite simply, we always choose the lesser of two evils whenever possible.

If we look at the economy as an example, this is quite obvious.

A real economy should work so that people earn money and then spend it in a way that maintains jobs, allowing people to earn enough to spend again. The amount of money in circulation should correspond to the quantity and value of goods offered, so that neither goods nor money remain in excess with nothing to spend them on. But that’s not quite possible, because we probably never produce exactly as much as can be sold, and it’s not certain that people will earn enough to buy everything. And so such a real market economy would only lead from one problem to another.

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And that is why economies are distorted in various ways.

Sometimes, for example, money printing and the amount of money in circulation are restricted to prevent price increases and thus inflation. But this isn’t done all that often, because voters don’t like it and might be dissatisfied with a frugal government.

At other times, money is pumped into the economy to encourage more spending. And voters like that better. Until that extra money manifests itself in the form of inflation—that is, rising prices—which nobody likes.

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Often, the government subsidizes living expenses or even directly funds the livelihoods of the socially disadvantaged at public expense. So money is taken from the rich—or at least those who earn a decent living—and given to the poor. This is often fair when it comes to old-age pensions, which we must earn through our work, but not for other benefits, which are sometimes more and sometimes less deserved.

Sometimes certain products are subsidized so they sell better; other times, high taxes are slapped on them so people pay through the nose. And the real price here doesn’t really make sense. Sometimes inefficient production is financially supported just to create jobs, and other times those who can earn enough on their own are fleeced.

So it’s hard to find fairness in the economy. It wasn’t there even before November 1989, when we were an egalitarian state, nor after we gained our freedom. And things will probably never get better.