Henry Hazlitt in Economics in One Lesson, on the nature of credit:
“There is a strange idea abroad, held by all monetary cranks, that credit is something a banker gives to a man. Credit, on the contrary, is something a man already has. He has it, perhaps, because he already has marketable assets of a greater cash value than the loan for which he is asking. Or he has it because his character and past record have earned it. He brings it into the bank with him. That is why the banker makes him the loan. The banker is not giving him something for nothing. He feels assured of repayment. He is merely exchanging a more liquid form of asset or credit for a less liquid form.“
or, to put it another way, even less palatable to modern sensibilities:
“The wicked borroweth and payeth not again” (Psalms. 37:21 a).
A great economist and the greatest primer on economics ever written. If it were required reading in schools, the world would not be in the mess it is in. He also wrote “The Failure of the New Economics”, a detailed chapter-by-chapter refutation of Keynes’s “General Theory of Employment, Interest, and Money”. I used it in college to battle with my econ prof.
If I were a 26 year old and was offered free money by the government, I would be thoroughly insulted. I would feel like a hypocrite, accepting the right to vote but not the right to contribute. I would want my parents to revolt, for they wouldn’t want their status as my parents be taken away by my accepting alms from someone else.
The fact that these politicians can bring in crazy laws and be seen as charitable, and the society’s difficulty in understanding economics, in my opinion, is not a problem of logic but a very serious spiritual and moral problem.
Jayant –
You are one of the few people who gets that.
So-called intellectual difficulties usually have their root in moral problems.
That’s why using logic or reason to appeal to some people doesn’t work. What might work is contact with a human being or experience which transforms them..