Tuesday, April 14, 2020

Should Libertarians Cash Their Bailout Checks?

Viresh Amin emails:
If you get a stimulus check, do you cash the check? I know some people out of principle don't want a handout. 
RW response:

I don't consider the check a handout, I consider it a major effort to depreciate the currency and you need the "stimulus" money just to stay even.

I say this because the Federal Reserve will have to monetize the borrowing the Treasury will do to fund the checks it is sending out.

By monetize, I mean the Fed will print money out of thin air to buy Treasury securities. It is this monetization which results in the depreciation of the currency.

Consider it this way: Suppose the Treasury was sending out checks to everyone for a million dollars rather than $1,2000. If you did not cash your check, the money you would be holding would seriously deteriorate and you wouldn't have the buying power to buy normal goods and service because everyone else would have the million dollars to bid up goods and services. So in this case, the million dollars wouldn't be a handout, where the government is taking money from someone else and giving it to you, but rather a destruction of the value of the currency that they force you to use.

If you don't cash the million dollar check, you are basically depriving yourself the possibility of staying somewhat even in terms of purchasing power before the great money pump.

It is the exact same thing with the $1,200 checks, just on a smaller scale.


  1. Excellent analysis as always.

    Have you put any thought into how many people might get the nutty idea to use this answer to the recent toilet paper shortage to buy silver or maybe even a small quantity of gold?

    On a somewhat related note I'm wondering if you have any thoughts on a ban on those who are flush with cash but accept unemployment checks from traveling to foreign countries once they open up. Europe will probably be open for business sooner than the U.S., and spending a few weeks there crossed my mind since I know some people in various countries.

    I have the option to take a four month furlough while keeping my health insurance and collecting unemployment. There's no guarantee that I would get my job back, but odds are I would so it would be a small gamble. I'd also be fine for quite a while if I was shown the door, so anxiety is low.

    In principle the idea of accepting welfare makes my stomach turn, but on the other hand an overtly bankrupt country that was bound for that position anyhow strikes me as more willing but less capable of meddling in my affairs as a low profile citizen. That instinct falls in that grey area where I can't tell if I'm being too naive or optimistic.

    You, Doug Casey and Bob Moriarty are the most no-nonsense, seasoned front-liners I know of on matters like these.

  2. Here are 2 programs,  also part of the CARES ACT which are totally unrelated  & aside from the $1200 which each person will automatically get . 

    These apply to the self-employed & independent contractors.  Your tax preparer should be able to answer any questions. 


    Pandemic Unemployment Assistance (Above is the link for California, but go to Google & type in Pandemic Unemployment Assistance along with your state & you'll find the correct link which applies to you.)

    As part of the federal CARES Act, the new Pandemic Unemployment Assistance (PUA) program helps unemployed Californians who are business owners, self-employed, independent contractors, have limited work history, and others not usually eligible for regular state UI benefits who are out of business or services are significantly reduced as a direct result of the pandemic. 



    Paycheck Protection Program
    An SBA loan that helps businesses keep their workforce employed during the Coronavirus (COVID-19) crisis

    The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll. SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.
    ...Lenders may begin processing loan applications as soon as April 3, 2020. The Paycheck Protection Program will be available through June 30, 2020.

  3. If you are a net taxpayer, then if you receive a stimulus check, you are simply receiving back some of the money that was originally stolen from you. If a thief stole your television and brought it back to you the next day, then would you refuse to take it?

  4. Only some perverted libertarian cuck would refuse to cash their check. Pretty confused "principles" out there.

  5. It saddens me to see how quickly otherwise conscientious and conservative libertarians abandon their principles of government non-intervention in their lives during a crisis when money is involved. If the principles of liberty mean anything at all they have to hold true through all the dark days of life not just when "the sky is blue and the sun is shining." Of course that reality can only occur when one has a firm faith in the One True God instead of his competitor, the Leviathan State.
    The problem with the government as thief analogy is the government steals money from most everyone. Can you separate your monies from that stolen from others? I think not. And regardless how you see it, government sees it as, not you getting your own money back, but as government giving their money to you.
    It is sort of like the decision to borrow money or not; if one absolutely cuts off that option and leave yourself no recourse but to be creative, innovative and entrepreneurial ...guess what? You will be creative, innovative and entrepreneurial! Speaking as someone who has steadfastly refused any and all government "largess" in its many forms and avenues, there is a power of resolve that comes into your life if you refuse to receive that money.

    "Until one is committed, there is hesitancy, the chance to draw back, always ineffectiveness. Concerning all acts of initiative (and creation), there is one elementary truth, the ignorance of which kills countless ideas and splendid plans: The moment one definitely commits oneself, then Providence moves too. All sorts of things occur to help one that would never otherwise have occurred. A whole stream of events issues from the decision, raising in one’s favor all manner of unforeseen incidents and meetings and material assistance, which no man could have dreamed would have come his way.” ~ W. H. Murray

    1. You could always accept the check and donate it to your favorite charity.

    2. "Can you separate your monies from that stolen from others?"

      Nobody needs to do that. Money is fungible. That's one of a few characteristics that makes it money.

      "if one absolutely cuts off that option and leave yourself no recourse but to be creative, innovative and entrepreneurial"

      The implication of this argument of people doing more when it is more difficult for them is that the higher the taxes are, the more creative, innovative, and entrepreneurial people will be. Which we known to be false. Government's artificial roadblocks and subsidies cause declines in all three generally speaking across a population.

      So the effect will vary on people depending on where on the scale they already are and if this decreases the roadblocks or increases the subsidies for them. Plus their own personality. Since we are discussing those people who will see their net taxation reduced then their actions will promote all three.

    3. I refuse to be a victim of my circumstances. I am a product of my decisions and if I do not believe my God-given creativity with His help cannot run circles around the State, then your perspective would be correct.

      “Those who do not think outside the box are easily contained.” ~ Nicolas Manetta

  6. Should libertarians walk on government sidewalks?

  7. i will not let devaluation occur to my holdings due to ineptitude by money printers. This is just returned funds for immorally seized monies in the end if nothing else.

  8. It is not a "handout", it is some of your money that government stole in the first place. If you refuse any benefit from government you are failing to claim your stolen money. If there is a helicopter money giveaway, that will inflate the currency and if you refuse the giveaway, whatever money you do have goes down in value. A Libertarian resist taxation, but not recovering his taxes.

  9. Let's see $1,200 divided by (silver @x dollars/oz) so I'll order...

  10. yes. and then buy a gun with it.

  11. Not sure if the total printing spree is 2 trillion or 6 trillion but it will most likely grow. Dividing this by 128,000,000 households in the US equals between $16,000 and $47,000 in new debt PER HOUSEHOLD. If each household gets ~$1,800 this raises two questions:
    1) Why are we happy? We've been robbed of savings and future buying power as this 'new' money floods the market. So yes, take it. Nobody asked my permission to steel my savings or place my kids into debt servitude for life. I'm gonna use mine to pay taxes - give em their fake paper back.
    2) Where did the rest of it go? Oh yeah, to the cronies that created this scare, lobbied for the pre-written bills, ran the existing banking structure into the ground, etc. Just like 2008, the worst offenders get the dough and we get the shaft.
    We get the government we allow. Use this reset as an opportunity to reset your brain. Stop borrowing. Turn off the TV and read hard books. Study real history. Resist everything government tries to do - they DO NOT have your interests at heart.