It Takes A Village
This article was written by Gary Christenson and originally published at The Deviant Investor
This is a short story. It has a purpose. Bear with me.
A long time ago and far, far away there was a village that was occasionally raided by outlaws who took food, jewels, and women. The villagers were understandably angry but could do little to protect themselves.
One day a large and fearsome dragon landed in the village square. After negotiating with the Mayor, the dragon agreed to protect the village in return for food.
A year passed and the town was raided no more. People felt safer and realized that everyone was afraid of the dragon, its sharp claws, and the fire it could breathe from its mouth to incinerate anyone who threatened the village or the dragon.
The people rejoiced in their new safety but noted that the dragon ate a lot of food.
After five years the village was still safe but problems had developed.
- The Village Council had borrowed an excessive amount of money to pay for dragon food. The Council raised taxes and angered the residents. They were told the dragon and the increased taxes made them safer. Not everyone believed the Council.
- Farmers had increased prices for the food they raised because of the added demand created by the dragon. Residents were angered by the higher food costs.
- The Village had hired many more employees to clean up after the dragon’s messy eating and waste habits. While the extra employment was good, the Village had to increase borrowing to pay the new employees and that caused many other problems.
- Because the Village borrowed so much money the cost of capital tripled which discouraged new business and new economic activity. Two markets closed.
- The Village grew poorer, deeper in debt, and even the farmers who had extra revenue from their crops noticed that all their costs had increased and they were no better off than before the dragon arrived.
- Most of the other Village residents had a lower standard of living.
- After a drought and partial crop failure, not only did prices for wheat triple, the dragon was underfed, cranky, and ate three of the Village residents. People complained but nobody wanted to anger the dragon.
Finally the people met in secret and eventually presented demands to the Village Council. They stated that the dragon ate more than it was worth for protection and the villagers wanted the dragon gone. They demanded the Mayor roust the dragon and send it on its way. The Mayor promptly resigned. The village remained without a functioning Mayor for several years.
The village became poorer each year, people left for other villages after realizing that the dragon would stay there permanently and the village deteriorated culturally and economically. It was no longer a growing and vital village where people lived in relative happiness and prosperity.
As village life declined and farmers grew less food, there was much less for both the people and the dragon. The dragon had to be fed so the village offered a few mal-contents and old people to the dragon as food.
Within two years almost everyone was afraid that the village council would enter their homes and offer them to the dragon as food. People fled the village and the only ones who remained were the members of the council, who were confident that the dragon would protect, but not eat, them.
They were mistaken. The village slowly died, the dragon ate Bar-B-Qed councilmen for dinner, burned the village to the ground, and flew away, searching for another village in need of protection.
The village was forgotten, all debts defaulted, and everyone died and/or lost all their money, except for the dragon which gained weight and had trouble flying after eating so much for so long.
I have not stated what individuals, businesses, governments, or cartels are represented by the dragon. I can think of several. You can also.
I didn’t mention that the Village Council could have purchased a printing press and printed extra money to pay for dragon food. The village would have been destroyed regardless, but the people would have revolted or left the village sooner due to higher prices and lack of confidence in the newly printed money.
I didn’t mention that the dragon developed a conscience, realized his detrimental influence upon the village, and reduced his food intake, because it did not happen. Dragons do not have a conscience and don’t care about villagers.
I did not mention that the Mayor gave reassuring speeches in the public square telling the villagers they were better off and that he had statistics from the village clerk that proved it. The Mayor knew the people were not better off but he was stupid so he lied to the people.
I did not mention that the village had survived for hundreds of years, even though it was occasionally raided, but it died in less than 40 years under the protection of the dragon.
But this village was a long, long way away and this story happened before the world developed High Frequency Trading, Derivatives, Quantitative Easing, PhD economists, central banking, paper money, and career politicians to manage the affairs of our nation, so this story may not be relevant to our modern and sophisticated world.
On the other hand, if it is relevant, I encourage you to avoid hungry dragons.