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Harry Browne: Why Libertarians Prospered in the Crisis

Posted on March 3, 2011 at 6:36 PM

LIO Senior Advisor Harry Browne passed away 5 years ago this week.

While newspapers and officials blamed the economic crisis on "too much" Libertarianism, claiming it proves freedom false, Libertarians were actually doing well following the "Libertarian Lifestyle" precepts of "people's philosopher and economist" Harry Browne, a US best-selling author who passed away 5 years ago this week.

Browne, who with other LIO advisors helped lead the USLP to its largest size in paying members and people in office to date by 2002--and was a twice Libertarian presidential US candidate helping smash down ballot access barriers--proposed a simple system of portfolio or investment class management for all economies.The public educator wrote many best-selling books on applying Libertarian concepts to better relationships, businesses, and public finances; and was consulted by many world leaders.

His system ( in his book Fail Safe Investing ) was based on the idea that one must not passively accept the market but 'manage upwards' with proactive thinking. Far from depending on government to regulate the economy coercively, one was best advised to realize that very regulation was the main danger and act both to defeat it, and be ready for inevitable economic changes for better or worse. The system was meant to be usable by the average person to safeguard key investments meant to produce basic income against 'officials misled by crackpot statist theories' tampering with free markets, which he held was the main reason for recurring and major economic crises.

He pointed out that by annually re-adjusting one's investments among cash, bonds, stocks, and metals such as gold each year, at least one of them grew in any economy and the re-adjustment served as a "circuit breaker" or bulwark against problems with the others. The portfolio should be the main focus of activity until it produced sufficient income. If one was willing to dedicate the time, he also recommended a second portfolio divided among home and real estate, home business, community help and disaster insurances. The disaster preparation ranged from additional cash and asset reserves to catastrophe insurance to some assets abroad to e.g. an extended supply of food, guns and medicine, and water for emergencies or major catastropes. Only with this basic security should the average person consider more speculative investments, he proposed, which would become better as the public became more informed; and nations naturally better civil and emergency defense.

Browne also felt the system would, as it spread, pressure errant officials towards reforms as they saw their policies outwitted. Widespread adoption would itself help stabilize economies while increasing investor education. Libertarians who used the system, for example, saw their portfolios rise with gold investments and automatic removal from deteriorating real estate, while automatically positioned for better investment at the lows due to more cash and survival stores for long term unemployment. In addition, he felt that the system helped critique public finance towards more stable and proactive policies and away from e.g. deficit financing and uncontrolled taxation. Similarly, he advised banks and business to use a similar philosophy with cautious reserves, which are still there while others sank or sought government bail-outs in the crisis, say fans of his approach.

Browne left a legacy of applied Libertarianism for improving households, relationships, workplaces, and citizen action in his many books; plus a project meant to help the public easily contact officials he hoped would be an example worldwide, www.DownsizeDC.org

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