Ed. Note: Earlier this month, the people behind something called the "Liberty Dollar" saw their offices raided by the FBI. The Liberty Dollar bills itself as a "private voluntary barter currency," which I assumed was code for a libertarian scheme designed to bring about the downfall of the Federal Reserve, in the spirit of the fiercely anti-Fed libertarian demigod Ron Paul. (The Liberty Dollar folks have a coin with Ron Paul on it.) I reached out to a libertarian friend who writes the blog The Agnoptimists to get some hard answers. His thoughts are below. —JS
As a libertarian, I like to argue with opponents of my free market views by focusing on outcomes: simply put, the central question is whether centralized government programs are really more attractive than market outcomes.
Anyone who seeks the best solutions to society's dilemmas should embrace experiments that allow direct comparison between government projects and private enterprise. The U.S. Post Office is constantly improving its service due to competition from companies like FedEx and UPS, for example.
The Federal Reserve is a favorite target for libertarian critique, and with good reason. There is no inherent value backing the U.S. dollar; instead, a small group of powerful individuals unilaterally and undemocratically controls our nation's money supply. They are free to redistribute wealth from savers to borrowers, which they do incrementally but consistently by creating new money, and their inability to manage interest rates perfectly is at least partially responsible for the economically destructive boom/bust business cycle and the current housing crisis. Worst of all, U.S. citizens are forced to accept the U.S. dollar—the term "legal tender" means that people cannot refuse the dollar even if inflation renders it worthless. Alan Greenspan was famously skeptical of this deeply flawed system, and Americans should not be content.