Only in Paradise is there no scarcity: all goods are plentiful, and scarcity is an entirely unknown concept. That is precisely why there is no economy, division of labor, or trade.
Throughout history, and even today, we have repeatedly seen the resurgence of a particular idea: interest is theft and should therefore be prohibited. Indeed, why should anyone have to repay more than they borrowed? What its proponents fail to understand is the difference between having resources at one’s disposal today and deferring their use until some point in the future by lending them to others. Like all earthly goods, time is finite. We are not immortal, and our quality of life tends to decline as we age. Interest is merely the price of time.
The scarcity of goods, once regarded as an axiomatic foundation of economics, is increasingly being obscured. Some radical leftists even argue that scarcity itself is nothing more than a propaganda myth deliberately cultivated by the „capitalists” to justify the exploitation of the working class. According to this view, all goods would be abundant if only they were distributed judiciously.
States, on the other hand, behave as though scarcity were not an ontological fact, but merely an unfortunate consequence of misguided policies—as though the right policies could eliminate all shortages and usher in universal prosperity. This betrays a fundamental misunderstanding of what prosperity actually means. Prosperity does not consist in eliminating the inherent scarcity of goods, but in successfully adapting to it through economic activity.
One of the most insidious ways in which the state perpetuates the illusion of abundance is through monetary policy. Since money can be created at will, through relatively simple or more sophisticated mechanisms, we seem to have overcome the curse of scarcity. The monetary base can be expanded indefinitely, and with an infinite supply of means of exchange, the goods being exchanged must surely be infinite as well—or so the reasoning goes.
Budget deficits, then, are nothing more than accounting illusions. They can simply be erased by striking them off the books. Everyone is entitled to subsidies, from the largest banks and corporations, bailed out by the state because they are „too big to fail,” to the unemployed and those receiving welfare benefits. Are certain industries or investment projects unable to survive in the market? No problem—we subsidize them. Are wages too low? No problem—we keep raising the minimum wage. Are interest rates too high? No problem—we cap them by decree. And anyone who refuses to fall into line is subtly coerced through ever-expanding regulation.
All of this serves to obscure an elementary truth: we live in a world of scarcity, and the only way to adapt to it successfully is through free markets—that is, through voluntary exchanges between individuals, a division of labor, respect for property rights, and the honoring of contracts. These are the conditions necessary to maximize prosperity.
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