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News Link • Economics: Austrian

Financial Sustainability or Irrational Exuberance in Liberty Projects?


I’ve been thinking about this since Ofer Nave spoke in the Agorist Panel at the New Hampshire Liberty Forum this year. He drew a distinction between sustainable and unsustainable counter economic activity, but predicted a series of tipping points when more unsustainable activities become sustainable as the counter economy grows. He also made an economic point that in the current market it makes more sense to spend dollars than silver currency. Greshem’s Law suggests that when legal tender laws exist, if a merchant accepts silver and paper it’s in the customer’s best interest to spend paper and horde silver. But, agorists still spend silver against their economic self-interest out of what Ofer called “irrational exuberance,” or passion for liberty. I have a similar concept that I call the “entertainment premium” on activism.

There is an axiom libertarians use to talk about government spending; that which is economically unsustainable cannot endure. This applies to liberty projects too. I’m concerned that if our liberty projects are sustained by irrational exuberance, and not by actual economic incentives, these projects, maybe the movement itself, is unsustainable without the zeal of converts, because eventually the enthusiasm bubble pops. Even communism works for the first generation, because the labor force is motivated to work by the irrational exuberance to prove the concept. But the second generation has no such enthusiasm. They are motivated only by the actual economic incentives, of which there are none. Lots of revolutions rise and fall based on this dynamic, but I want more for our movement.


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