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Peter Schiff: “The Fault Lines Emerge”

March 31, 2009

From Peter Schiff, here is an essay titled The Fault Lines Emerge which has a paragraph that neatly sums up the problem we have with Washington’s economic assumptions:

Printing money is merely taxation in another form. Rather than robbing citizens of their money, government robs their money of its purchasing power. Many people assume that if government provides the funds we can spend our way back to prosperity. However, it’s not money we lack but production. If the government simply prints money and doles it out, we will not be able to buy more stuff; we will simply pay higher prices. The only way to buy more is to produce more. It is production that creates purchasing power, not the printing press!

How do we make America productive again–at least those segments that are not competitive in the world economy now?  That will be one of the issues we must face to resolve the economic situation we now face.

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