Fiat Money: A Recipe for Authoritarianism and Tyranny
Incentives of Fiat Money at Nation-State Level
Fiat money gives governments the power to become more authoritarian and create a surveillance state, police state and militaristic, corrupt tyrannies. Central banking makes it easy for governments to run deficits on their budget without facing the trade-offs inherent in sound money. This has allowed major budget battles to shift from trade-offs between various items to who will get to hand out more rent-seeking policies.
Effects of Fiat Money on Nations
The power of fiat money allows governments to steal the wealth of their nation without being easily noticed. It also incentivizes individuals with higher time preferences due to debt and lack of savings vehicles, as well as companies favoring larger entities over families. These effects have enabled nations around the world to become more authoritarian and oppressive in their policies.
Destructive Power of Governments
The destructive power of governments in the last 100 years can be attributed primarily to fiat money and its ability to give those in power control over nations’ wealth. This has enabled government authority and power to expand rapidly, leading people into a welfare/warfare state with an authoritarian vision that encourages Marxism and positivist law.
Infinity Gauntlet Analogy
Fiat money is like the Infinity Gauntlet of Marvel fame, giving those in power immense control over nations’ wealth without requiring much effort or understanding from them. This allows governments to take advantage of their citizens’ lack of knowledge about central banking by running deficits without needing approval from voters or making hard choices with budget items.
It is clear that fiat money gives governments too much unchecked power which can lead them down a dangerous path towards tyranny and oppression. The incentives it creates encourage individuals towards higher time preferences through debt, corporations towards larger entities instead of families, and nations towards authoritarianism through rent-seeking policies and militaristic tactics. To prevent this kind of destruction caused by unchecked government authority, countries need alternative forms of currency such as cryptocurrency that are backed by sound economic principles instead of fiat currency’s promise only backed by trust in central banking authorities