My friends at Politico, Jim VandeHei and Eamon Javers, have a piece this morning about those who advocate doing nothing in the face of our economic crisis. No stimulus, nada, these folks argue.
I think there’s an argument for doing nothing but it’s so outside the conventional mainstream, far to the right of the House Republicans, that it seems to me incumbent upon Politico, for whom I’ve written and which I admire, to have noted that some of the experts quoted in their piece have what we might call exotic histories.
The piece quotes Andrew Schiff, as “an investment consultant at Euro-Pacific Capital and a card-carrying member of the stand-tall-against-the-stimulus lobby.” He tells Politico: “All this stimulus money is geared toward getting consumers spending and borrowing again. But spending and borrowing were the problem in the first place.” This quote and identification make him sound like some typical money guy expressing the kind of fiscal prudence you expect from Hal Holbrooke in Wall Street.
But who is Schiff? His brother is Peter Schiff, the head of the firm, Euro Pacific Capital, and they are both advocates of what’s called Austrian economics, the hard-core laissez faire philosophy advocated by Freidrich August von Hayek, Ron Paul and others. Their father, Irwin, is doing time in federal prison as part of the tax honesty movement which believes that our tax laws are unconstitutional. Irwin was known for his crusades against taxes and has done other stints for failure to pay taxes.
Peter Schiff has said that he wished the Fed would be abolished and was a Ron Paul adviser in the last presidential race. Andrew Schiff is the firm’s spokesman; Peter is the president. There’s not really any daylight between them.
So when you’re dealing with people who don’t believe in the Federal Reserve and are libertarians of an extreme stripe wouldn’t it be good to label them as such?
Politico’s not alone though. Andrew Schiff can be found regularly on CNBC and other cable outlets.
Now, to be fair, the Schiffs have actually been prescient as hoardes of libertarian emails are prepared to note. They were extreme economic pessimists when the Dow was soaring. They predicted the market and the economy would tank.
But even a broken clock, so the saying goes, is right twice a day. Consider their argument for abolishing the Fed or restraining it. Imagine how much worse things would be if the Fed had not intervened this year. Of course, the Hayek-Schiff-Paul argument is that the loose money of the Fed, which Paul has called unconstitutional, is the cause of our woes in the first place. And while it’s true many economists think Alan Greenspan should have been tighter, the Schiff argument opposes the very creation of the Fed. I suppose if we’d stayed on a barter system we wouldn’t have our current housing woes either. We’d be in caves not condos. The Schiffs also had gold climbing to absurd levels as part of their scenario which it hasn’t.
All of which is to say, sometimes it pays to identify a source more thoroughly.