How Would the Free Market Handle Money?

by | Jan 30, 2017

How Would the Free Market Handle Money?

by | Jan 30, 2017

One of the most destructive attributes of government is its routine practice of using force to create monopolies in the marketplace. This is the unfortunate reality each of us has encountered when trying to establish utility accounts for a new residence. Unlike other goods and services, where there are a plethora of service providers to choose from, utility companies enjoy a state-sanctioned monopoly where residents are forced to use only those companies which have been given a contract by a local government.

Unlike other services where consumers can simply opt out of purchasing, individuals rely heavily on access to water, gas, and electricity. Choosing not to purchase these necessities is not an option. However, when there is only one game in town providing services essential to daily life, there is no recourse or mechanism in place to ensure quality assurance.

Even if every resident were to complain about their electric company there would be no incentive for these companies to improve since there is nowhere else for the consumer to go. These companies do not have to rely on quality services when they receive the same compensation regardless of consumer satisfaction.

While the government monopoly over the utility industry is an experience to which almost all Americans can relate, few realize that the government also has a monopoly over our monetary system.

Currently, the federal government has sole control over the creation and distribution of the United States dollar. While many Americans view central control over currency as a legitimate government power, this is simply because most cannot fathom an alternative reality.

In the late 1970s, Friedrich A. Hayek posed a question that no other economist had thought to ask in the nearly two thousand years since the study of economics was established: what if private entities issued money instead of the state?

[Ed. note: this essay is a scholarship submission, so we encourage our readers to please read the rest of Brittany’s essay at Sound Money Defense League.]

About Brittany Hunter

Brittany Hunter is an associate editor at FEE. Brittany studied political science at Utah Valley University with a minor in Constitutional studies.

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