Deflation Made Simple (Part II)

A falsely vilified phenomenon (Entry 133)

What makes the criminal different from the average person is not the criminality of his thoughts, but the criminality of his actions. Indeed, knowing how to be criminal in our thoughts is surely a good, not necessarily the best, defense against the criminality of others’ actions. Cheating, for example, is great fun in play, but a grave matter of some consequence when one’s livelihood depends on it. In play cheating teaches us to appreciate the value of rules by testing the consequences of their absence (Image 3).

Old rules under new conditions, that appear at fist glance not to apply, are sometimes easily swept aside because we cannot clearly foresee the consequences of their absence. And, old rules under new conditions that are not clearly understood are more easily discarded, if new rules can be found that offer obvious benefits that the old rules do not.

Most human beings are positively inclined. Unfortunately, they too often willingly ignore the long term costs of bad action, when the short-term reward of such action is sufficiently large, immediate, and gratifying. As a result, short-term sacrifice to avoid long-term costs is too often abandoned — an important reason why we should not be quick to abandon tradition.

In a similar context, there is no end to the amount of rationalization and spurious blame that we can conjure to conceal our bad actions from others and ourselves. Indeed, such thinking can even help us to recover the reward that we derived and lost because of our bad action.

Then too, without experimentation, it is difficult to advance, and experimentation often requires the breaking of tradition.

So, where do we draw the line of experimentation?

What were the bankers of Seville to do, for example, when King Charles V insisted that they surrender the contents of their vaults in the name of the Faith and the Holy Roman Empire? And, what were the guildsmen-bankers of London and the managers of the Wisselbank to do, when William III of Orange became King of England and insisted on the defeat of Louis XIV? These are question that are difficult to answer without having lived in the moment when the King called called upon them.

Is necessity not the mother of invention? But alas, not all children are born of good parents.

This said, with historical hind-sight and a good understanding of human frailty we can reconstruct — at least, in part — a plausible explanation for bad action without condemning the future of humanity to oblivion.

So, let us return to the other side of the English Channel before we further consider the emergence of money-ex-nihilo. In the end, we have yet to complete our discussion of the last epoch (1689-1713) of the Long Century (Images 80, 85, 87, 100, as well as Entries 116 and 121). Alas, understanding the circumstances in which past bad action takes place, can help us to avoid current bad action.

Charles II died of natural causes in 1685, and James II, his younger brother, assumed the English throne. Unlike his older brother who wavered in his faith, James II was a devout Catholic. He had formally converted to Catholicism in 1669, but had pretty much been a Catholic since his service in the army of Louis XIV during his exile in France many years before. In 1671 James II’s first wife, Anne Hyde, who was not of royal birth died. She left James II with two surviving daughters: Mary (1662-1694) and Anne (1665-1714) — both future Queens of England. Mary became the wife of William III of Orange in 1677.

Marie Beatrice d’Este (1658-1718) was born in Modena, Italy and became James II’s second wife in 1673. She was a devout Catholic and the marriage was arranged through French channels. In 1688 she gave birth to James Francis Edward. Fearful that he would become James II’s successor, William III of Orange was invited to assume the English throne with his Anglican wife, Mary, and the Glorious Revolution began.

In liberty, or not at all,
Roddy A. Stegemann