Unpacking Mises: Fractional Reserve Banking and the Currency School

Mises Fellow Kristoffer Hansen joins Bob to discuss Mises’ perspective on fractional reserve banking and free banking. Earlier this month, Larry White referenced Hansen’s work on fractional reserve banking, asserting that Hansen indicated Mises acknowledged the benefits of FRB. Kristoffer clarifies his paper and examines what Mises wrote in Human Action on the topic.

Additionally, Bob and Kristoffer delve into the influence of the Currency School on banking and economic instability, as well as how commodity-backed money might impact the business cycle.

  • Kristoffer’s Article in the QJAE, “Sound Money without Free Banking”: Mises.org/HAP472a
  • Kristoffer and Jonathan Newman’s Article in the QJAE Clarifying Rothbard’s Definition of Inflation: Mises.org/HAP472b
  • Human Action Podcast Episode 470 on the Debate Over Fractional Reserve Banking: Mises.org/HAP472c

The Mises Institute is giving away 100,000 copies of Murray Rothbard’s, What Has Government Done to Our Money? Get your free copy at Mises.org/HAPodFree


What is the Mises Institute?

The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard.

Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.

 


Originally Posted at https://mises.org/


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It’s not your imagination; get-out-the-vote ads were more obnoxious this year. Thousands of people were shocked to receive intimidating letters claiming their voting history was being monitored, “nonpartisan” mail-in ballot request forms bearing Michelle Obama’s face, misleading text messages telling them they had already voted, and remember-to-vote postcards designed to look like lottery tickets. Most people had never seen tactics like these before, but they were everywhere in 2024.

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The industry enjoyed tremendous success in 2020, registering millions of swing-state voters to defeat Trump while attracting more donors than ever before, but after 2020, everything began to collapse. The industry’s success led to unprecedented scrutiny from journalists, Republican legislators, think-tank leaders, and even law enforcement. For the first time, voter registration groups were hiring PR staff. Meanwhile, actual members of the “New American Majority” were leaving the Democratic Party.

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In November 2023, George Soros canceled a $67 million pledge to Latino get-out-the-vote groups after “Democrats [saw] Latinos peel away from the party.” In January 2024, an interview with the leader of the Everybody Votes Campaign, the industry’s biggest player, revealed that Everybody Votes, which had registered around 850,000 voters annually and 5.1 million total from 2017-22, had only registered 400,000 more by the start of 2024. The interview also showed EVC was struggling to circumvent newly passed election integrity laws because “keeping up with those laws is time-consuming, it’s expensive … partners, and even funders, are getting worried that this work is too risky.”

In April 2024, the trickle of desertions from the would-be “Majority” became a flood when a memo from Democratic strategist Aaron Strauss “sparked a furious debate in Democratic circles about whether to narrow the focus of voter registration efforts to avoid signing up likely Republicans.” The memo advised Democratic megadonors to abandon “nonpartisan” voter registration because most unregistered voters were now Republicans. “Indeed, if we were to blindly register nonvoters and get them on the rolls, we would be distinctly aiding Trump’s quest for a personal dictatorship,” Strauss declared.

The memo was poorly received. Partisan donors were loath to give up their favorite tax-exempt toy, and the registration industrial complex wanted the money, so the grift continued. In 2024, AllByApril, a donor coalition led by eBay founder Pierre Omidyar, doubled down, ensuring checks to voter registration groups were delivered by April to maximize election impact. The campaign raised $150+ million and was joined by 174 donors. Perhaps some donors quietly cut back, but it seems like Strauss’ warning was ignored.

As registrations became harder to collect, desperation mounted. Multiple vendors to Everybody Votes were caught fraudulently inflating their numbers. Voter Participation Center was caught filtering its Facebook ads to avoid Republicans. Finally, the creepy “we’ll know if you voted” ads were deployed, alienating the “charitable” GOTV industry’s possible allies. Now the industry finds itself alone against hundreds of disgruntled donors and a Republican trifecta that it accidentally helped create, while legislation to revoke the tax-exempt status of partisan “charities” is in vogue like never before.

It’s poetic justice.

Parker Thayer is an investigative researcher at the Capital Research Center.

Tyler Durden
Tue, 11/26/2024 – 07:20

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