Oct 17, 2011 (LBO) – Anti-capitalist protests have spread to several European capitals from the US, with protestors converging on financial districts, in a text book style consequence of excessive state interference, long predicted by Austrian economists.
The US in particular is suffering from the collapse of a massive credit expansion fired by easy money policies of the Federal Reserve which controlled interest rates with the use of the coercive power of the state.
At the time then President Bush increased military spending.
Both the US and European governments, then bailed out banks with public money and printed fresh money and continued to deficit spend to boost ‘growth’. Protestors are angry particularly about bailing out banks.
In the US in particular, calls for increasing protectionism – restricting the trade liberties of the people in favour of big domestic business – are rising.
The Austrian economics school, led by Nobel laureate Friedrich August von Hayek and Ludwig von Mises who watched the bubbles fired by central banking, state deficit spending in Europe have long warned of the consequences of state interference.
Misses has also warned of inevitable public reaction.