“you’ve called someone a socialist for not supporting your Big Central Government model”
I don’t have a big central government model. I don’t have a model at all - I’ve already stated my scale of preferences among typical monetary arrangements, but I’ve also indicated most of them are just fine with me, I regard none of the usual ones as fundamentally illegitimate, just some as more expedient than others. I have counseled asking less of monetary policy, not more, invited people to try to restore a commodity standard without actually expecting it to fly, etc.
But I am not willing to renounce the economic freedom to issue debt obligations without prior explicit commodity cover, if both parties freely contract to do so. I have been pointing out that one cannot actually get a monetary regime that forbids any kind of fiduciary issuance of the kind Austrians regard as responsible for the cycle, without abolishing more in the way of economic freedoms than the (dubious) end involved can possibly be worth.
Since the other side of the argument in the thread has acknowledge - insisted for their own part, really - that such issuance predates central banking, and existed under a gold standard (or gold exchange standard) with fractional reserve banking, it is ridiculous to pretend I am defending the Fed. The other side isn’t attacking just the Fed, but practices that predate it by hundreds of years, and extend well beyond any government role in the matter. If bankers issue fiduciary media beyond commodity cover, without any government involvement whatever, the Misesian-Austrian objection remains unaltered. Hence they are not objecting to a government role in the matter, but to the economic practice itself, even if engaged in freely by non-government actors. To prevent such free action, would require extensive government intervention in free credit decisions - as I have explained at length, by showing all the other economic practices that have the same effect.
You can’t object to institution A because of effect A prime, and seek to outlaw effect A prime, without also objecting to all other institutions that have effect A prime. You might object to institution A on some other basis. But the basis chosen determines the breadth of institutions struck by the objection or criticism. If essential economic liberties are attacked this way, then libertarians ought to object, themselves. Say the government intervenes in the health care market by providing health insurance plans. If one objects to allegely horrible consequences of health insurance plans of any kind and uses this as a basis to criticise that government action, then those interested in their economic freedom to contract for health care plans have to object. If instead you only objected that the state has no legitimate role in the matter, that would be a different story, since it would leave private actors free.
But the objection that issuance of fiduciary media beyond commodity cover is supposedly ruinous, is not an objection to state action, but to a specific kind of economic action that any institution (or indeed, individual entrepeneur) might engage in, that historically was engaged in by banks long before states intervened in the matter, and that is still dominated by private actors - and would remain to private actors under most monetary reforms, including plenty I would support or have no objection toward.
When furthermore such action is painted as criminal, likened to counterfeiting, and it is remarked with approval that people doing so might be murdered, then I see a violent attack on an essential economic liberty - and an arm of the state being engaged in or support it, recently, is a mere excuse. Those so attacked are not agents of the state. They are not oppressing anyone. They are free men providing a valuable service, legitimately. But they are still being painted as enemies who deserve death. This is exactly what socialists did when they advocated murder of capitalists along with the abolition of profit as supposedly illegitimate and based on exploitation, and denounced the laws that protected property as a mere protection racket or “committee of defense of the bourgoisie”. They fully intend, despite attacking a state controlled by others at the time, to use state action to assault those they slandered. And so do those who attack bankers violently, while painting the bare phenomenon of gratuitous credit as a crime.
Attacking “big banks” because they “get what they want” out of the government is not libertarianism. Banks (like those others brought up - Citi or Merrill e.g.) are private institutions, protected by the right of free association, and pillars of capitalism. They are also not remotely exclusive and anybody who likes may partner with them by simply owning their shares, making it ridiculous to paint them as some nefarious enemy.
“shown that competition to their monopoly has proven to be impossible”
Nothing of the kind has been shown. I have shown that you can join them if you can’t beat them, and I’ve explained the businesslike way to go about providing an alternate store of value money - and I’ve also explained how completely voluntary any exposure to the supposedly ruinous effects of their action is, and how to avoid it if one wants to do so.
“ignore the negative effects of inflationary policies”
I believe I clearly indicated the role of excessive money issuance in the cycle, and agreed it has negative consequences. I simply do not agree that those consequences can all be abolished with a specific institutional reform, and deny it is worth the attempt. I believe those consequences are entirely parallel to the consequences of every other significant forecast error on the part of entrepeneurs. If allegedly negative consequences of such errors were sufficient reason to abolish the freedom to engage in the actions in which those errors arise, then all significant economic freedom would be destroyed. There is no significant action by entrepeneurs that will leave the value of all other commodities that others happen to hold, unchanged. Simply changing the value of commodities you freely choose to hold, is not a crime. When two other parties freely contract in a way that has that as a side effect, you have no legitimate objection in the matter. You have no prior right to the value of any set of commodities you choose to hold, remaining unchanged by the combined actions of others. It would be impossible to ensure any such pretended right, even if someone wanted to grant it.
The goal being unattainable and the cost being potentially as high as all our economic freedoms, I am not willing to conceed the principle behind the criticism. If you confined yourself solely to criticizing a state role where you think there should be none, or less than now, I would not have this objection. But you are not so confining yourself. You are criticizing private bankers for propagating their debts and others for accepting those debts as money. And you have no standing to do so - your entire objection is baseless.
“I just looked at your posting history and you appear to be a one issue astroturfer”
I posted on Austrians and the cycle before, in blog format rather than this forum. I posted on the present banking crisis in another thread, to answer another’s question. I post elsewhere at great length on all sorts of issues (notably at Free Republic, tens of thousands of times). My issue with Austrians is about economics and banking - I think them fine on the diagnosis of the cycle as I thought I made tolerably clear, but Mises specifically wrong in the policy prescription for the reasons I have stated here, at length. Why would I post about Pakistan here? Why would I post about general history here? I have many interests, I post tens of thousands of times about them, but they are not all at the little tiny pond that is Mises.org.
“which bank pays your salary”
Do I have to cite chapter and verse from Mises personally about the illegitimacy of this sort of argumentation? It has no basis in fact, of course. But see Theory and History, early on, for Mises’ own choice words for those who engage in it.
First, threaten to rob if not murder a whole class of people. Then if anybody defends them, claim they are one of them and only defending them out of self interest, and therefore anything they say is to be discounted. Only arguments that agree with the original bloodthirsty demand will survive this procedure - but of course it settles nothing. Worse, it shows the bankruptcy of those who resort to it. Worse still in this instance, the only alleged evidence that I must be a paid tool of the nefarious banking cartel is that I have defending their economic rights - while in fact I work in the software industry, etc.
But who benefits? You would, if you were right and bought bank stock at the next open. But you don’t, because you don’t believe your own “line”.
As for my allegedly missing something about Hayek, I can assure you I haven’t, but my position is my own. Where Hayek is invaluable in this discussion is his principled defense of economic liberty in “Road”, and his direct argument that seeking economic security at any cost is a game not worth the candle. Economic liberty, or liberty of any kind, is not to be sacrificed for a few percent a year on savings - especially not when you can get it anyway by just being anything but brain dead about the assets you use as stores of value (use commodities or portfolio investment including equities, not the debt of banks under fiat money).
I’ve read pretty much all of Mises, and most of the modern explicators of the Austrian position. And the precedessors, Bohm Bawerk etc. And the critics and other sides and modern monetarists. And economic history, ages back. And… well, pretty much everything really.
There is nothing discredited about any of my monetary views, either from any of those classic authors nor from anything anyone has written in this thread. Yes Mises has a whole store of excellent arguments ready and waiting for scads of other unsound positions, but this helps not a bit for the man in front of you, who simply isn’t making any of those errors. He is instead pointing out a couple in Mises himself, which are in fact errors, and prescribing a more moderate goal for reform.
Incidentally, I think Hayek or Mises would be just horrified by men pretending to speak in their name while advocating the murder of bankers as supposedly notorious criminals, simply for issuing fiduciary media. Both were principled liberals and loathed that sort of rhetoric from the bottom of their hearts. They didn’t want anyone murdered for engaging in finance - even for engaging in it unsuccessfully or badly. If they wanted to reform institutions in the matter, it was because they sincerely believe it was possible to remove downside consequences without threatening anyone or imperiling anyone’s necessary liberties in the matter. For Mises specifically and the commodity cover issue specifically, I think he just had not thought the generalized consequence through sufficiently. This is not too surprising - even his diagnosis of the way issuance of money substitutes affects the economy had “bugs”. But certainly you will nowhere find Mises speaking of hanging men or shooting them because of how they have conducted their banking operations, nor will you find him calling everyone in the free market “zombies”.
With Hayek we don’t have to speculate - he made his principle quite clear in Road. A little hoped-for economic security (here, alleged abolition of the cycle) is not worth vital economic liberties (here, ability of private parties to freely contract in credit transactions).