Entries Tagged 'Mises Economics' ↓

We put up The German Question by Wilhelm Ropke last month but I'm only now focusing on its importance in the history of liberty, thanks to the prompting of Samuel Gregg at the Acton Institute. He pointed out that it was this book that inspired the postwar economic reform in Germany -- which Ropke himself did not believe had gone nearly far enough.

But this is far from being merely a plea to get rid of price controls. It is a call for wholesale moral, political, and economic reform, for in his view it was not enough to get rid of corrupt leadership but to completely purge the principle that the central state is in charge of the whole of society. A thorough de-Hitlerization would require dismantling the central state and restore the old city states, completely ending the monopoly on industry and education and medical care, and a restoration of sound money, not to mention free trade with the world.

It came out in 1945 in Switzerland, one year after Mises's Omnipotent Government and Hayek's Road to Serfdom. It is more sweeping than the former (in a policy sense) and more radical than the latter (in a policy sense). In fact, I'm not entirely sure why it is that I had never heard of this book, except to say that it seems like most of Ropke's writings from this period haven't received the attention they deserve.

We'll have this available in paperback soon, but for now, have a look.

All these peculiarities of the structure of modern tyranny, whose ugliest and extremest form was Nazism, are marked by the entire dissolution of the values and standards without which our society, or any other, cannot exist in the long run: a pernicious anaemia of morality, a cynical unconcern in the choice of means, which in the absence of firm principles become ends in themselves; a nihilistic lack of principle, and, in a word, what may be described literally as Satanism and Nihilism. Everything rots away, and finally there remains only one fixed aim of the tyranny, to which all moral principles, all promises, treaties, guarantees, and ideologies are ruthlessly sacrificed --the naked lust for domination, for the preservation of the continually threatened power, a power held on to for no other purpose than the continued enjoyment of all its fruits. The immorality of such a regime needs no arguing.

There are some writers in politics whose prose seems to overcome the limits of the passage of time and the coldness of the printed word, writers whose thoughts are so scintillating that reading them causes you lose track of where you are and who you are and become part of their time very thought processes, and leave you changed. Your heart races as you read, you see things a new way, and your marvel at their capacity for framing the debate in a way that has eluded the whole of the mainstream political culture.

I have to count Garet Garrett among those writers. And I'm reminded of this after having read "Insatiable Government," the title essay of a new collection of some of Garrett's best writing, as edited by Bruce Ramsey. Actually I'm not entirely sure what it means to refer to his "best writing," since just about everything he wrote between The Driver in 1922 and The Wild Wheel in 1954. And yet this essay, which has been unnoticed for three quarters of a century, should somehow stand out.

It was written in 1932: as an attack on the Hoover administration. You know President Hoover, the guy about whom the textbooks say did nothing to stop the worsening depression. We are told that he didn't take the problem seriously and instead trusted market forces to work themselves out.

We are told that he let the banks fall, the unemployment lines lengthen, the business sector to collapse, and, stuck in his 19th century frame of mind, did nothing that he should have done. It took the white knight named FDR to show up and take charge, using emergency powers and Keynesian theory to save the day.

Ok, if so, consider this from Garrett in 1932. He presumes that Hoover is using every power available to him to do precisely what the historians claim that FDR started. More profoundly, Garrett observes that success in these endeavors would be far worse than failure, because it would establish the principle that government should grow without end.

I know that long quotes are not reader friendly but this is irresistible. Thank goodness for Bruce Ramsey for highlighting it and bringing it back to public attention.

Think of the last party you held. There are some people you did not invite simply because you can't stand those people, usually for many reasons. And there are some who just might not mix well with others. Some people you want to invite but cannot because you have to cut the list somewhere. Now imagine that the government appoints a party planner who says that you can invite or not invite whomever you want, provided that one consideration is not part of the mix: you must not decline to invite someone on grounds of hair color. Now, it may never have occurred to you to think along these lines. But now you have to. You notice that you have no redheads attending the party, much to your alarm. FULL ARTICLE

Bankrupt General Motors Corporation has begun its conversion into an arm of the government in advance of the subsidies it must receive in order to "survive" (for the present managers to keep their jobs). In yesterday's Wall Street Journal (subscription required), Holman Jenkins wrote an article in which he explains that the company lavishes hundreds of millions on development of the Volt, its electric car, so that it will have a basis for demanding subsidies both direct and to intrepid consumers who are willing to try driving a government car.

You can bet those folks never test-drove a(n East German) Trabant or Wartburg.

Jason Jewell of Faulkner University reviews Mises: The Last Knight of Liberalism in the Journal of Faith and the Academy, Summer 2008:

That it took nearly thirty-five years after Mises's death for the first full-length critical biography of him to be published is an indication of how desperately mainstream economics wishes to ignore his work. But it must be said that Guido Hülsmann's Mises: The Last Knight of Liberalism, an exhaustively researched treatment of Austria's greatest economist, was worth the wait. It is the product of a decade of combing through obscure archives in several countries and a thorough study of the thought of both Mises and his contemporaries. (It is worth noting that we might still be waiting for this book's appearance had not the Ludwig von Mises Institute, which funded Hülsmann's research, decided to publish it itself instead of turning it over to Columbia University Press or Oxford University Press, both of which wanted the title, but with substantial textual cuts, an astronomical retail price, and a turnaround time of over a year. The Mises Institute's ability to publish the work much more quickly and at a lower cost is indicative of technological changes in the printing world and the growing market share of small, independent publishers.)

Hülsmann divides his text of over 1,000 pages into six chronologically-arranged sections tracing the logical phases of Mises's life: his youth and education; his early work in the so-called Austrian school of economics, which culminated in his first great treatise, The Theory of Money and Credit (1912); his service as an artillery officer in World War I and involvement in the postwar Austrian recovery, including the publication of his second great treatise, Socialism (1922); his most influential years as a teacher and economist in Austria in the 1920s and early 1930s; his years in Switzerland (1934-1940); and, finally, his sojourn in the United States, which included the publication of his third and fourth major treatises, Human Action (1949) and Theory and History (1957). Each of these six sections is subdivided into several chapters, some of which still run to well over fifty pages. Fortunately, Hülsmann has taken pity on his readers and provided helpful subheadings within each chapter which break his content into more digestible units.

An outstanding feature of Mises is Hülsmann's placing of his subject into a well-developed context. For example, he digresses to explain the status of Jews (Mises was Jewish) in Vienna society and Austria-Hungary more generally in the fin de siècle; he also devotes upwards of seventy-five pages to establishing the context of the Austrian school and the important forerunners of Mises, such as Karl Menger and Eugen von Böhm-Bawerk. This survey will help particularly a general readership not already familiar with the methodological differences between Austrian and mainstream neoclassical economics. By the time Hülsmann arrives at a discussion of The Theory of Money and Credit, the reader knows exactly why the work was immediately hailed as a critical breakthrough for its integration of monetary theory into the system of marginalist value theory pioneered by Menger decades earlier.

Republicans used to talk about reducing the welfare state. I remember when candidate Ronald Reagan in 1980 promised to end the Energy and Education departments. Some Republicans, who themselves have caught the entitlement-spending/social-engineering bug, now propose the creation of a federal department of families.

Indeed many Republicans, who once said they were against the welfare state, now brag they are better at running the welfare state than the Democrats. FULL ARTICLE

Corn, wheat, sugar and a dozen other crops all got increased subsidies in the recent Farm Bill, signed with terrifying agreement. Ryan Krueger asks whether there an end in sight.

One overlooked clue while those crops are fetching sky-high prices in that other system known as the free market is data showing farms took acreage from pastureland, which livestock need to graze. So, ranchers have been liquidating herds and giving up in the battle against soaring feed costs.

"Various proponents of Free Trade Agreements (FTAs) posit that some trade is better than no trade. While that is arguably true in terms of marginal units, these politically crafted bilateral and multilateral agreements should really be called Some Trade, More Trade, or Kinda Free agreements, but certainly not Free Trade.

Better yet, to accurately reflect their true nature, all of them should be called Managed Trade because on each page within every agreement are quotas, stipulations, and byzantine clauses that rival the federal tax code. FULL ARTICLE

Probably not since Hazlitt wrote for Newsweek has its pages mentioned the Austrians so it is interesting to read this:

At Vienna University, the works of the great Austrian school of capitalist thinkers were all but ignored for more than half a century. In 2005, thanks to fund-raising by a local free-markets group, there is now a new professorship teaching such key theorists as Joseph Schumpeter (think "creative destruction") and Friedrich Hayek (famed for his impassioned critique of socialism).

A core problem with government is that its managers believe that all reality will conform to their wishes if they issue the right orders, pass the right laws, and put the right people in charge.

Reality resists this simple-minded approach; witness the debacle of the war on terror. Sadly, the same group that has managed that war is now managing another one: the war on recession.

These people ought to be given a video-game console to play with. The stakes are too high to permit them to play their games using real wealth and real lives.

FULL ARTICLE