Mises Memo Summer 2004

8/7/2019 Mises Memo Summer 2004

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Mises MemoNews f rom th e Ludwig v on M ises Ins t i tu te S umm e r 2004

Why Economic Educa t ion?This summer, students from

al l over th e United States andmany countries around die worldhave come to the campus of theMises Ins t i tute to learn about th eeconomics of human liberty. Theyhave been chosen from amongmany applicants to benefit from theunique economics education available from the faculty we have gathered.

In the Mises campus, with itslarge and specialized library, itsadvanced technology and an outstanding learning environment,these students have discovered anidealized setting that will leavetheir intellectual lives foreveraffected. Most in tend academiccareers of teaching and researching

in economics, history, philosophy,and law. Others will be in journalism or perhaps the ministry. Butwhatever path they choose, theywill be prepared to offer thestrongest possible defense of theidea o f freedom.

Among the great offerings thissummer are two complete sessionsof die Mises University widi itstamed faculty, a mil weekof lectureswidi Hans-Hermann Hoppe, a fullweek with ta x h is to ri an Cha rl esAdams, an ongoing student colloquium, evening seminars and films,and daily interaction on the Rillrange of topics within die social sciences.

Technical economics is anessential part of the program but

Faculty andstudents attending Mises University

so is the broader moral point. Asociety that respects propertvrights and is unmanaged by diecent ra l s t at e is the essential condition for the flourishing of humanity and civilization. It is this libertystemming from privateproperty and reliant on peacethat has brought such blessings tothe w orld . And vet it is endangered by states that interfere withthe operations of the market economy.That idea isdie central lessonof history, and the main messageo f economic science.

AntigapitalismEveryone, apart from a fewsocialist fanatics, believes in freeenterprise. Right? Surely there isno real need to give people spe

cialized training in a subject aboutwhich there is little dispute.Tha t's w h at w e are told. But ifyou look more closely, you find avery different picture. Politicalcampaigns have been reduced to acompetition over who can offerthe most prizes to special interestsat the expense of the taxpayer.Alternatively, it is a tight overwhich set of producers is going tobenefit at the expense of consumers and through what means.Whatever happens, the result is anattack on liberty and property.(This is explained beautifully inRalph Raico's taped courscwork:Histon: The Strugglefi r Liberty.)It sets worse. Thumbingthrough any day's stories from thebusiness press turns up fallacies

galore. Here we find calls fo r


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national planning, new health-caremandates, higher taxes to fundpublic schools (and private schoolsthrough vouchers), higher minimum wages, environmental planning, antitrust policy, interventionby the Federal Reserve, bailouts ofindustry, protectionism, zoningcontrols, price controls on products, government funding ofresearch, work-time regulations,forced assoc ia tion at the workplace, world central planning, andwaras development policy, amonga thousand other bad ideas. Th e Root of B a d I d e a sEach of these topics is dealtwidi in the coursework, publica

tions, and books of the MisesInstitute, not just as piecemealtopics but as part of an overallframework of economic theory.Even s tudents who come to usalready sympathetic toward capitalismfind themselves enlighte ne d a nd even ama ze d a t d ie ideasthey discover in our programs.

It is not by accident that thesame fallacies appear in collegetextbooks, not just from economics and bus in es s e th ic s classes but

The Mises Memo is published quarterlyby the Ludwig von Mises Insti tute . Volume 10, No. 2. Copyr ight 2004 by th eLudwig von Mises Institute, 518 WestMagnolia Ave., Auburn, Alabama 36832-4528; 334-321-2100; fax 334-321-2119;[email protected]; www.mises.org.

from all disciplines. It seems thateveryone has a bone to pick withthe market economy. These samepeople have an unlimited faidi inthe state (despite all experience) toperform better than the marketeconomy (despite all experience).We are talking about intractableerrorof the sort that requires deepstudy and understanding to dislodge.As much as people talk aboutdie triumph of capitalism, it isclear

that basic truths o f economics canno longerbe taken for granted. Forexample, the environmental movement and various religious movements deer)' the idea that economicgrowth should be celebrated. Theysay that this degrades people andharms non-human living things.Just as absurdly, unions around thecountry aremobilizing to keep businesses like Wal-Mart from locatingin poor areas, on the claim that thiswould destroy "community."Thusdowesec the relationship

between intellectual error andimpoverishment. What is taught inthe classrooms at colleges and universities eventually comes to havean effect on the lives of real people,for good or ill. On the bright side,there is also a relationship betweenthe ideas of freedom and prosperity. The goal of the Mises Institutein setting up a different sort oflearning is to have an impact onthe ideas o f t he future.

Man, Economy, and StateMa n y people have written toas k how sales and distribution of Man, Economy, and State

with Power and Market are going.This great treatise by Murray N.Rothbard has been given new lifein th e Mises Inst itu te edit ion thatcombines the two books into theone they were meant to be, andpresents them in an edition perfect

All books and tapesfeatured here can be orderedonline at mises.org, or w iththe enc losed order fo rm, orby calling 800-636-4737.

for students, complete with footnotes at the bottom of the pageand a long introduction based onthe archives.We have been extremelypleased with the reaction. As sev

eral Amazon reviewers have mentioned, this edition is worth owning even if you have the other twobooks. The added features ar eessential, and seeing them as awholetheory united with practiceprovides an entirely differentperspective on the meaning of theproject.

Those who have revisited th ebook in recent days have commented that it should bea priorityo f the A ustrian movement toencourage wide readership andstudy of this book. It is as clear inits exposition as it isrigorous in itstheory. It preparesstudents to dealwith the barrage of fallacies theyencounter in graduate school, andmakes it possible for professionaleconomists to spot errors easily.Nothing shapes the mind like anintegrated treatise, and Rothbard'saccomplishes this task brilliantly.

Man,Economy ,State

P ow e rAN D

M a r k et

News from th e Ludwig von Mises Inst i tu te SUMMl-.K 2 0 0 4


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Our goalis to makethe book'scontents aswidely available aspossible. To this end, we have put theent ire tex t online, in several formats. As with Mises's books, wehave found that doing thisincreases interest and encouragessales. Most important from thepoint of view of the Institute, itaccomplishes the goal of globale conomi c e du ca ti on t owa rd freedom and prosperity.

Inflationist IdeologyIt was no great shock that Bushappointed Alan Greenspan toanother term. What has provideda shock to many has been theresurgence of die old beastofpriceinflation. That's not to say it everwent away. Even at rates of 2-4percent, the dollar's value haseroded by half since Reagan's firstterm. The best way out is the goldstandard, which would prevent thecurrencv from being inflated tofund the government's pet projects. The great irony is that AlanGreenspan himselfwrote up a veryMisesian defense of the gold standard back in 1966. This is a goodreminder tha t mor e t ha n technicalknowledge isneeded to restore liberty; courage is alsoessential.

In support of the gold standard, we are preparing a new edit ion o f WJjat has Government Doneto Our Money? by Murray Roth-bard, and working constantly tomake all of his writings on thistopic available. The Mises Institute has been the leading supporter of the gold standard sinceour founding. People observe thatt he re s eems to be little chance o fseeing gold restored anytime soon.Perhaps so, but we would be muchworse off i f no o ne we re e ve n talking about the issue.

One great sign: the FinancialTimes recently ran a hyster ica l

attack on the idea of die gold standard. If the prospect were not athreat, why bother?

Incidentally, Murray Roth-bard's great book America's GreatDepression has just appeared inChinese, from the Century Publishing Group of Shanghai. It is avery beautiful edition. Meanwhile,Rothbard's neglected revisionistwork on E dm und Burke has beenpublished in Polish.

War andCentral Planning

T h e scope of economics is farvas te r than wha t is called"economic policy." It extends to all

Wha t HasGove rnmen tDon e to Ou rMoney?

Murray N. Rothbard

Summer 2 0 0 4 News f rom th e Ludwig v on M is es I n s t i t u t e

relations between peoples insofaras it impacts on dieir materialwell-being. This is why the MiscsInstitute has never shied awayfrom dealing with topics of warand peace. Immediately after theattacks on 9-11, we warnedagainst new and cosdy wars thatcr ea te n ew e nemie s and do nothing to bring about justice.

I t was Mises who first saw th econnec t ion between socialism andwarthey are mutually reinforcing in every respect. War ends upputting the central planners incharge, as Robert Higgs points outin a wonderfu l series o f lectures wehave made available in a tape setf or i nd iv id ua l or classroom use:Crisis and Liberty: The Expansion ofGovernment Power.

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Jus t as the welfare statists andregulators live with illusions aboutsociety and business, U.S. plannerswent into Iraq with incredible illusions about what war and occupation could accomplish for a country. To put the best spin on it, theidea was that replacing a despotwith a U.S.-led government wouldjumpstart the country towarddemocracy and freedom, and thisexample would spread throughoutthe region until all the Middle Eastand Gulf region embraced the U.S.model .


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Had they read what the Austrian School has writ ten aboutwar, they never would have fallenfor this nonsense, the Bush administration would have avoided aquagmire, tens of thousands oflives would have been saved, andthe world would be safer.

"War," wrote Mises in 1922,"is harmful, not only to the conquered but to the conqueror. Society has arisen ou t of the works ofpeace; the essence of society ispeacemaking. Peace and not war isthe father of all things. Only economic act ion has created thewealth around us; labor, no t theprofession of arms, brings happiness. Peace builds, war destroys."

The Mises Institute has beenon the forefront in the study ofgovernment, war, and peace. In1997, there was the pioneeringvolume The Costs ofWar, editedbyJohn V Denson, which drewattention to this much neglectedtopic. In 1998, there was Secession,State, andLiberty, edited by DavidGordon, which examined thealternative to the large nation-stateand th e v io le nt mean s o f conflictsuppression. In 2001, there wasextended analysis of the domesticconsequences of war: Reassessingthe Presidency, edited by Denson.

The newest book goes even further to examine private alternatives: The Myth of NationalDefense, edited bv Hans-HermannHoppe.

If liberty is to have a future, itwill come through die fundamental rethinking of die very idea ofthe welfare-warfare state. In th eend, it will be ideas that willencourage the flowering of a newpost-imperialAmerican freedom. Tin- : Austrian Scholars

ConferenceThe Austr ian Scholars Conference this year was the usualnightmare for socialist intellectuals. The forces of history were supposed to have flattened the Austr ian School and the free marketmore than a century ago. Sovietwriters were calling Mises adinosaur in the 1940s, whileRothbard was d ismissed as a has-been when his 1962 t reatiseappeared.

As this year showed, not onlyare the Austrians alive; they arethriving and growing and on thecutting edge of scholarship in aworld where the government andits minions, no matter hownumerous, are always behind the

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times. During the conference, ourcampus was packed with smart,productive, and confident professors a nd stu de nts who considerthemselves students ofLudwig vonMises and Murray N. Rothbard, allgathered in Auburn for three daysto present and hear a host of original papers, share new and oldideas, and plot a future of freedomfrom state planning.

Most o f our visitors wer e f romthe United States, but 20 othercountries were also represented.Though our visitors are studvingdifferent areas of economics, history, and philosophy, they areunited in a consis tent intellectualvision of free markets, peace, individual liberty, and decentralized,smaller government. Their goal isto teach and promote the caseagainst all forms of state control, toreconstruct the teaching of historyto reflect this vision, and to workto bring about a world withouttyranny.

Our named lecturers this yearincluded Sean Corrigan, JosephStromberg, Thomas Woods,Richard Ebeling, and Tobv Baxen-dale. All their ta lks became available for the wor ld online and inprint. Of the 80 or so presentations, many will appear in journals

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News from th e Ludwig von Misks Inst i tu te Summer 2004


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in being able to do this. Congratulations, for example, go to PaulCwik, whose d is se rt ati on oninterest rates and yield curves isnow available at www.mises.org/studvguide.asp.

Mises Fellow Paul Cwik

The JournalsThe scholarly journal, properly

conceived, serves an essentialpurpose in allowing new researchto be published and made known,and in building a community ofscholars. The journals of the eighteenth and nineteenth centuriesseem fearless by comparison tothe current crop. Far from currying favor with power, the best ofthem took it on , and dealt withfundamental questions, regardlessof official displeasure.

Where today can scholars consider such questions as the meaning of property rights, the correctrelationship between the individual and the state, the violentnatureof economic planning, andhow history is scarred by wars,taxes, and other government programs? Where are the articles thatcan completely overturn conventional wisdom, and exposereceived opinion as false? Whereare the truly scientific studies

showing that conventional economic models are theoreticallyunsound?

Thank goodness for the Journal of Libertarian Studies and theQuarterly Journal ofAustrian Economics. These journals stimulateresearch, recruit new young people, and intensify communicationand cooperation. Their ideas maketheir way into libraries and classrooms, and recruit a new generat ion o f s tudents .

Yes, both journals take risks.But this is necessary to break thestranglehold that the state exercises over academic opinion, andto attract the young. They providea rare zone o f freedom where ou tstanding scholars can publish realresearch and new ideas. No wonder their audience is so b ro ad a nddedica ted. We are dedicated tomaking sure there are scholarlyjournals to hold high the flame ofliberty in dark times.

T h e Med i a ServerWe were troubled for vears

about all the recordings ofgreat lectures we own but couldnot make available to people; itwas never reallv viable for a smallinstitute like ours to throw ourselves in to the riskv waters o f

THEQuarterlyJ o u r n a lofAus t r i ane conomi c s

After th e Ag e o f InflationBefore an d After th e EuroRe


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these people need to readLlewellyn Rockwell's Speaking ofLiberty, as published by the MisesInstitute. The reviews have beenfabulous so far, and the book isachieving excellent sales. Thankgoodness too that die Conservative Book Club ha s made SOL afeatured se lec t ion.

W o r k in g for LibertyThe intellectual guidance ofhumanity,"wrote Ludwig vonMises, "belongs to the very fewwho think fo r themselves. " This iswhy he, and his student MurrayRothbard, were hopeful about theprospects for liberty. Socialist andstatist ideologies dominated theirage and ours, and yet statism cannot triumph in the long run solong as independent thinkers whobelieve in liberty arc willing tothrow themselves in to the intellectual struggle.We are not talking about aniche idea that is important in one

area of life bu t no other, like asmall insight in the natural sciences, however impor tant tha tmay be. No, Mises and Rothbardwere thinking about something farlarger: diey saw that the idea ofhuman liberty itself is the motherof all progress that mankind hasever made, in science, health, andhuman well-being generally.

The Mises Ins t i tu te wasfounded as a research center basedon the classical l iberalism tha t hasalways been under fire: the ideaso f Mises and the t radi t ion o fthought he represents. The goal ofth e M is es Inst i tute is to facilitatethese revolutionary ideas throughevery form of education and publication. In the spirit ofMises, westrive to be the world's leadingproviderof scholarlysupport services fo r the Austrian School o feconomics, free-market theory,

Speakingof Liberty

and libertarian political philosophy. The Institute publishes journals and books, holds internationally renowned teaching conferences, assists faculty and studen ts with research services, andadministers one o f th e mos t heavily trafficked institutional websitesin the world (with voluminousresources used by millions),among a huge range of other proje c t s .

Supporting theM i se s InstituteWe do not seek nor would we

ever accept governmentsupport. We exist solely on thevoluntary contributions of the natural elites who unders tand andvalue th e work o f freedom. Wehave a small and dedicated s taff, avast network of students, faculty,and volunteers around the wor ld ,and depend entirely on the financial support of people who shareour ideals. Working with andthrough the Miscs Institute is awonderful way for people whobelieve in liberty to make a difference.

We have the testimony ofmany giants in our historyEA.Hayek, Ludwig vonMises, HenryHazlitt, Murray N. RothbardSummer 2004 News from th e Ludwig von Mises Inst i tu te

t ha t the b es t m ea ns to achieve thegoal of liberty is not workingwithin the structure of government or even seeking to educateexisting office holders and bureaucrats, but rather public educationgenerallyWe seek to use every medium

we can to advance ou r ideas, fromthe smallest newslet ter to thelargest website. Change never happens automatically. It requirestremendous effort and creativitytobring about change. The effect ofideas on a civilization is like waveson water. By the time they reachthe shore, no one remembers orknows for sure where they camefrom. Our job is to stick to dietask. Weshould use every means atour disposal to get die ideas outthere; what happens after that isasunpredictable as the future alwaysis .

The key to our success is thatthe Mises Ins t i tute is al l abou tbeing attached to principle andtruth before anything else. We'venever t raded shor t - term attentionfor building for the long term.Mises did not and he paid a personal price. But his ideas arechanging the world. We must allfollow his lead, never giving in,never giving up, fighting for truth

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unti l our last breath. We have d iepassion and energy Most importantly, we have truth on our side. T h e Work of Liberty

At the Mises Institute, we havedone the work of liberty for22 years in hundreds of seminarsand lectures. In fact, we do itaround the clock every day for aninternational audience. Hardly aday goes by when we do notreceive an email from some stud en t s om ewh er e who credits ourwork with changing the way helooks at the world.

Does it ma tte r th at one student's mind is changed? Yes, itmatters. I t matte rs fo r tha t oneperson and it matters for the history of liberty itself. If we workevery day to sponsor scholarshipand educat ion that backs th e ideaof freedom, and we work harderand smarter dian the other side,and we do no t b ec om e d is co uraged or allow ourselves to beintimidated, someday we will turnaround to discover diat we havemade a revolution. We may neverget credit, but that is not what weseek. We are in this businessbecause we believe. We have faith,which is the evidence of thingsunseen. What is unseen in ourcountry and world right now is afree society that we knowwould beproductive, peaceful, and moral.

What th e friends o f freedomneed more than anything elsetoday is die personal stamina thatconies with moral conviction. Thecause needs you more now thanever. A time for liberty will comewhen we realize that history isnothing more than the workingou t o f what we t hi nk and believe.By choosing to pursue educationas the means to revolution, youhave seized on the most workablemeans to save civilization itself. Itis an awesome responsibility

Recurring Don a t i o n sThe Mises Institute now makesit possible to give to the workof liberty every month, automatically, by setting up a recurringcredit card charge. It is a great wayto make sure that your support isongoing without having to set upcomplicated financial arrangements. As one donor told us: " thisis estate planning for the rest ofus." We hope you take advantageof the opportunity by authorizinga mondily donation. You can do itonline at mises.org, or call us at800-636-4737 and let us set it upfor you.

Requ i e s g a t in P a g ee mourn the deaths o f theseheroes o f f reedom:w ;

Mr. George Conncll of Parachute, Colorado, had been aMember o f d ie I ns ti tu te since 1987. APurdue University graduate whoworked asa civil engineer throughout the world, he established theMurray N. Rothbard Medal ofFreedom to be awarded annuallyfo r a lifetime o f dedication to li berty, which certainly describes Mr.Connell, who personally chose thefirst two recipients, Burton S.Blumert in 2003 and Gary Northin 2004.

Mr. Robert D. Love, a Membe r of t he Ins ti tu te since 1984,was board chai rman o f the LoveBox Company in Wichita, Kansas,and an advocate o f Christian business principles. He also foundedthe Wichita Collegiate School, abastion of classical education,Christianity, and libertarianism.

Dr. Eberhard F. Besemann o fSignal Mountain, Tennessee,was aCharter Member (1983) of theInstitute, and a faithful supporterof Mises University. Mr. MyronW Chamberlin of Portsmouth,Virginia, was a graduate of the

Massachusetts Maritime Academy-He was a retired executive o f th eU.S. Naval Oceanographic Office,and a Charter Membe r o f the Institute (1983). Dr. RobertM. Hansenof Palm Desert, California was aCharter Member (1983) and a generous Patron of Institute publicat ions.

We also mourn the passing ofInstitute benefactors: Mr. SidneyD. Bell of Albany, California,Member since 1988; Mr. Myron I.Dickey, Jr., of Mount Enterprise,Texas, Member since 1985; Mr.Raymond V Shawstad of Mar-shalltown, Iowa, a Member since2002; and Mr. Richard E. Six ofAlexandria, Virginia, a Membersince 1987.

May these great men rest inpeace. In their spirit and in theirmemory, we will work to protectand enhance d ie ideals in whichthey believed, and for which theysacrificed.

George Connell

Robert D. Love

News from th e Ludwig v ox M is es Ins t i tute Summer 2 0 0 4

Documents

Mises Memo Summer 2004