Inflation has been the big issue of 2022. For almost everyone, the problem has become increasingly impossible to ignore. Prices are continuing to rise, the value of our savings is in decline. Inflation is effectively stealing our future.
But as long as half of the country believes that it is caused by the war in Ukraine, COVID, corporate profits, or that inflation like this is new and temporary, there will never be proper solutions to inflation.
At best, it will be viewed as one of those random problems we must deal with when we have a crisis. At worst, policies like price controls and other government interventions will gain steam.
Moreover, we must move to cure inflation with more liberty.
Since libertarianism is first and foremost a humble ideology – it doesn’t seek to have all of the answers – this will not be an exhaustive list. However, there are three major ways we can address inflation and its effects with more liberty.
The first and most obvious are policy changes. As Federal Reserve policies are what led us to this pandemic, the first and most obvious solution is to permanently turn off the money printer, Remove the ability of the U.S. Federal Reserve to centrally control the entire U.S. economy and allow something resembling competition to take over.
Take the future of the economy out of the hands of seven bankers and put it back where it belongs – in the hands of American entrepreneurs, consumers, and citizens. End the Fed.
That’s a big pill to swallow, however. So another thing that can ease the pain of inflation today is to lower import-export restrictions.
When the U.S. economy is in trouble, one of the things it can do is import goods from other countries to help consumers avoid majorly inflated prices. For months, there was a nationwide baby formula shortage – not because there wasn’t enough formula in production, but because the Food and Drug Administration banned the importing of European formula, even though it met near the same standards as U.S. formula for safety. Now that that restriction has been lifted, the shortage is on its way to being solved.
Another, broader example is the Merchant Marine Act of 1920, or the Jones Act. This act requires all ships that bring cargo to the U.S. to be U.S. owned, crewed, registered, and built.
If you’re thinking that that must be a small number of ships, you’d be right. These restrictions mean that the cargo fleet supplying imported goods for the entire United States is just 99 ships. Repealing the Jones Act alone would, by some estimates, cut the inflated costs of shipping by up to 50% and provide some temporary relief for Americans.
However, any libertarian who can only come up with policy solutions to problems is not a very good one, and there are two other major ways we can help reduce the sting of, and even ultimately solve, inflation, without a single act of a politician.
The first category is private market solutions. These include driving cryptocurrency adoption. One of the most attractive features of electronic currencies like Bitcoin is the lack of centralized economic control. Instead of a central bank determining what the currency is worth, the users determine the worth of currency.
As a store of value, by February 2022, the U.S. dollar had lost 95 percent of its value compared to Bitcoin in the past five years. Moving people into decentralized currencies like Bitcoin can be the greatest defense against inflation we have.
The final category is voluntary solutions for those who have been impacted by the sting of inflation. Food banks have seen a significant increase in demand, but donations have significantly dropped off. Claire Babineaux-Fontenot, Executive Director of Feeding America, the largest food bank network in the U.S. said, “You’re in the middle of a battle, and people are leaving the field.”
There are far more ways we can help without giving to existing organizations as well. Host a thanksgiving meal giveaway. Bring a family into your home for Christmas. Pay for someone’s utilities this month. A libertarian response to inflation should include investments, in our time, and in our money into serving people most harmed by rising prices.
There is no single policy or program that has done more to steal the future of our generation than inflation. For all the importance they have, high taxes, strict regulations, and even social issue restrictions have not had the impact on the ability of my generation to live in our society like reducing the reward for our work by 97 percent.
For the first time in over 100 years, Americans are listening. Their ears are peaked for the I-word. Why does it exist? Who is at fault? What can we do about it?
We have answers to all of these questions. This is our best shot to stop the politicians from stealing our future. If we decide to take it.
Students for Liberty North America is launching a month-long campaign to educate Americans on the causes of inflation, the widespread impact of inflation, and the libertarian solutions to inflation – Stop Stealing our Future. If you’re a current student and would like to join the program, be sure to click on the button below to get involved.
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This piece solely expresses the opinion of the author and not necessarily the organization as a whole. Students For Liberty is committed to facilitating a broad dialogue for liberty, representing a variety of opinions.