In the introduction to my eBook anthology released by FEE last September, When Money Goes Bad, I zeroed in on an economic cancer responsible for bringing down scores of economies over the centuries:
Inflation—the systematic expansion of the money supply followed by the depreciation of money’s value—takes something good and valuable and turns it bad. When inflation becomes hyperinflation, just about everything goes bad. A healthy economy devours itself and standards of living plummet. Why on earth would any government ever embark upon such destruction?
No country in the world today knows this more painfully than Venezuela, where prices are soaring at astonishing rates. The IMF predicts that inflation in that country will be measured in the millions of percent by year’s end.
The Austrian School economist Percy Greaves underscored the importance of money. He said, in fact, that it’s the most important commodity in a modern market society. It’s not wealth itself (what money buys, namely goods and services, is real wealth), but because it’s at least one side of every non-barter transaction, whatever happens to money will profoundly affect everything else. That’s why it’s critical that money be treated with respect, not as a plaything for profligate, irresponsible governments. Get it right and an economy can prosper; mess it up and living standards evaporate. We’ll all be able to breathe a sigh of relief someday when money once again is a market phenomenon, not a political one.
To help people understand money and the need to get it right, a new documentary for public television has come our way this month. Titled In Money We Trust?, it’s based on the book by Steve Forbes and Elizabeth Ames, Money: How the Destruction of the Dollar Threatens the Global Economy and What We Can Do About It.
Last summer, I sat down with Steve and Elizabeth in a New York hotel to film a clip for the movie. I’m honored to be among the economists and journalists featured in it. They include Brian Domitrovic, Steve Hanke, John Stossel, Paul Volcker, John Tamny, George Gilder, Seth Lipsky, Judy Shelton, and Mark Skousen, among others.
If you missed it on television, no worries. You can view the documentary at your own convenience, free of charge, right here.