Wednesday, October 16, 2013

"Why would the resource required for sustaining life in this economy be purposefully made scarce?"

Statistics show that there are an estimated 925 million hungry people in the world, which would imply that food is scarce. However, the world produces 2,720 kilocalories per person per day of food, more than enough to feed everyone on the planet. Food is not scarce.
Statistics show that approximately 630,000 people in the United States are homeless, which would imply that housing is scarce. However, there are over 19 million vacant homes in the United States, more than enough to house all those living on the streets. Housing is not scarce either.
It seems as though there is enough supply to meet the need for both food and housing, yet the reality for many people is that they are both scarce. They simply do not have the money to afford these basic necessities. Is money scarce?
Statistics show the amount of government and personal debt in the United States is now more than $34 trillion dollars, which would imply a lack of money. However, there is about $10 trillion dollars in the money supply.
Wait one second! Money is scarce! And when you investigate why, you will find that it is not scarce by accident. Due to the manner in which money comes into existence through interest-bearing debt, money is always in short supply. This is because when loans are made, only the principle is created, while the corresponding interest must be found in the marketplace in a never ending competition to avoid bankruptcy. And herein lies the problem. Why would the resource required for sustaining life in this economy be purposefully made scarce? (If we look hard enough, we may even find the source of our competitive world as well.)
Abundance is the enemy of a free market economy.  One need only attempt to sell an abundant resource (i.e. sand at the beach) to realize the futility in that endeavor. In the free market system, goods must be scarce so that people would be willing to buy them.

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